Jun 012019
 
 June 1, 2019  Posted by at 1:44 pm Primers Tagged with: , , , , , , , , , ,  


Pablo Picasso Rest (Marie-Thérèse Walter) 1932

With the news that Julian Assange is “wasting away” in Belmarsh prison hospital, and with UN rapporteur Professor Nils Melzer’s report detailing how this happens, I’m once again drawn towards the lawlessness that all “authorities” involved in his case have been displaying, and with impunity. They all apparently think they are literally above the law. Their own laws.

But they can’t be, nowhere, not above their respective national laws nor the international ones their countries have signed up to. They can’t, because that would instantly make any and all laws meaningless. So you tell me where we find ourselves today.

There’s this paragraph in an article by Jonathan Cook entitled Abuses Show Assange Case Was Never About Law, which lists “17 glaring anomalies in Assange’s legal troubles”, that sums it all up pretty perfectly:

Australia not only refused Assange, a citizen, any help during his long ordeal, but prime minister Julia Gillard even threatened to strip Assange of his citizenship, until it was pointed out that it would be illegal for Australia to do so.

See, Cook is already skipping a step there. Gillard didn’t take Assange’s citizenship away, because that is against Australian law, but it’s just as much against Australian law for a government to let one of its citizens rot in some kind of hell. Still, they did let him rot, but as an Australian citizen. At that point, what difference does anything make anymore?

This is a pattern that runs through the entire Assange “file”, and it does so to pretty astonishing levels. Where you’re forced to think that the countries involved effectively have no laws, and no courts, because if they did, the actions by their governments would surely be whistled back by parliaments or judges or someone, anyone. They’re all essentially lawless.

 

There are 5 principal countries involved in the case (that doesn’t absolve any other country from its own responsibility for speaking out when international laws are broken). In alphabetical order, they are Australia, Ecuador, Sweden, the UK and the US. We can go through them in that order.

Australia: The above already mostly sums up where Australia comes up short, i.e. fails miserably to such an extent that both its legal and its political system should long have sounded a five alarm -but didn’t-. A government cannot abandon its own citizens abroad, just because it doesn’t agree with what that citizen has done or said.

It can’t do that even if that citizen is a Hannibal Lecter or an Adolf Hitler, and Julian Assange is very far removed from either. Nor has anyone ever even claimed that Assange broke even one Australian law, let alone proven it. What it comes down to then is that it’s the government that has broken its own laws, not Assange. That, too, is a pattern, it holds for all 5 countries I mentioned above.

It’s not Assange who breaks laws and should be persecuted for that, it’s the politicians who form the governments of these countries. Plus of course the parliamentarians tasked with controlling them. And the legal systems as well as the press tasked with controlling the entire system.

UN rapporteur Nils Melzer says in his report: “Australia is a glaring absence in this case. They’re just not around, as if Assange was not an Australian citizen. That is not the correct way of dealing with that.”

 

Ecuador: This country’s former president, Rafael Correa, followed international law on asylum in the exact way it was framed and intentioned, by granting Julian Assange asylum in the summer of 2012. But his successor and former friend Lenin Moreno broke that law in the most flagrant ways imaginable.

Ecuador is a signatory country to both the United Nations Human Rights Council and the Inter-American Court of Human Rights. Moreno’s actions, which have led to UK police dragging Assange out of the Ecuador embassy in London, which international law says is Ecuadorian territory in which the UK has no jurisdiction, violate an entire litany of laws, rules and regulations phrased by both these international bodies, as well as Ecuador’s own laws (if only because they ARE a signatory member of both).

Asylum laws, necessarily international, have zero meaning if and when a country seeks to (re-)interpret them whenever the wind changes direction and/or a new government is installed. Asylum laws are there to last. You can’t throw out a person your country has previously granted asylum just because someone offers you a bag of money. That is the exact reason why there are such laws.

And every single country that is a signatory to these laws MUST protest what Moreno did to Assange, lest the laws covering asylum become invalid overnight. Well, that’s what they have become in April. For every single country, and for every single human being. That’s how far-reaching the events are.

Does phrasing it like that perhaps make it -a little bit- clearer how big an issue this is, that if it doesn’t apply to Assange, it by default doesn’t apply to anyone anymore? That his case wipes out many decades of jurisprudence, established after, and because of, two world wars and many other atrocities? That Assange’s treatment throws us back in time at least a full century?

Everyone NOT protesting what has been done to Assange had better think again. If you are a law student, lawyer, a judge in a democratic country, you have an obligation here, as much as all politicians have. It makes no difference what you think about Assange or what he’s done.

 

Sweden: The Swedes have sex crime laws that apparently are different from anyone else’s, more strict etc. Maybe they think they know better than everyone else?! In Assange’s story, this means they have closed the file on him on 2010, 2013 and 2017, but re-opened it again and again, for reasons that are not immediately clear -to me-.

This appears to indicate that once you’re suspected, let alone accused, of for instance rape, you may never be able to clear your name anymore. And don’t let’s forget that Assange was never charged with anything, not one single thing, all the way back to 2010.

From what we know, the two women mentioned in the case never wanted to file a complaint against him. But the police did. And then that complaint was thrown out. And revived. He was specifically allowed to leave the country after staying on for over a month, and then shortly after he did leave for London a Swedish prosecutor filed an Interpol Red Notice against him, something hitherto exclusively reserved for terrorists and war criminals.

Prosecutor Marianne Ny refused to interview Assange in London for years, though other such interviews – by Swedish prosecutors in Britain- took place 44 times during Assange’s stay in the Ecuador embassy. The UK even told Sweden not to close the case. And there’s still so much more that happened in Sweden. There is a term for a country that behaves like this: a rogue state.

 

The UK: Former UK ambassador and Assange adviser Craig Murray probably summarizes it best today when he says the UK has become a rogue state. This is true as well for Australia, Ecuador, Sweden and the US. It is the inevitable consequence of flouting the law.

Professor Melzer is the United Nations Special Rapporteur on Torture. Professor Melzer is Swiss. He is an extremely distinguished lawyer and Professor of International Law at the University of Glasgow in addition to Professor of International Humanitarian Law at the Geneva Academy. He served 12 years as a Red Cross Delegate. There is no doubting either Professor Melzer’s expertise or his independence in this matter. When Professor Melzer says that “UK courts have not shown the objectivity and impartiality required by law”, people should sit up and listen.

I have detailed judge Michael Snow calling Assange a “narcissistic personality” in a brief hearing in which Assange had said virtually nothing but “not guilty”, on the basis of prejudice Snow brought with him into the courtroom. Snow convicted him summarily of bail jumping and sentenced him to a virtually unprecedented 50 weeks.

I have detailed Judge Arbuthnot, wife of a former Tory Defence Minister who co-owns a company with a former Head of MI6, mocking Assange and saying he can get all the exercise his health required on a Juliet balcony, as she dismissed a motion to have the bail charges dropped. I have detailed Judge Phillips of the Supreme Court choosing to rely on the French text and discount the English text of a treaty in arguing extradition was in order.

The bias of the British courts has been palpable and stinking.[..] when the United Nations Working Group on Arbitrary and Illegal detention ruled that Julian was being held against his will in the Ecuadorean Embassy and should be permitted to leave to Ecuador, in repudiating the UN Working Group – whom the UK had supported in every single one of hundreds of previous cases – then Foreign Secretary Philip Hammond stood up in the Commons and denounced the UN Working Group as being “lay people not lawyers”, when in fact every single one of the panel is an extremely distinguished international lawyer.

Hammond’s lie to parliament did not surprise me; but I was genuinely astonished that the entire corporate and state media went along with this most blatant of lies and did not call it out. The BBC, Times, Financial Times, Guardian all reported Hammond’s comment that the UN panel were “not lawyers”. None of them would agree to publish a correction of this basic and easily verifiable fact.

Britain no longer makes a pretence of obeying the rule of international law. It simply refuses to acknowledge the concerns of the UN in the Assange case, happily dependent on the bubble of prejudice the political and media elite have manufactured. This is part of a general pattern of direspecting the UN. Theresa May as Home Secretary refused to let the UN Special Rapporteur on Violence Against Women inside Yarls Wood immigration detention centre to inspect conditions there. The Tory government reacted to the recent shocking UN report on poverty in the UK – none of the basic facts of which are challenged – by seeking to have the UN Rapporteur removed.

When you add this together with the UK’s refusal to accept the 13-1 Opinion of the International Court of Justice that the Chagos Islands belong to Mauritius, and the UK’s refusal to accept the ruling of the agreed International Chambers of Commerce Court of Arbitration that Britain must pay its debt to Iran, you get what is a very clear picture that the UK has gone full rogue state and has simply abandoned its support for the system of international law which was in very large part a UK creation.

UK Foreign Secretary Jeremy Hunt yesterday thought attack is the best defense and called out Professor Melzer for his criticism of the UK. Melzer responded by implying Hunt doesn’t know his own laws.

 

 

I was thinking when I saw the “conversation” that Hunt is basically implying Assange tortured himself. And that doesn’t just demonstrate poor knowledge of the law, that is full-blast BS. Because no matter what led to Assange seeking refuge in the Ecuador embassy, according to international law he always, under any and all circumstances, has (among other things) the right to proper medical care. The UK has refused him that.

It doesn’t even have anything to do with him being free to leave or not. Which he evidently was not. Moreover, other than skipping bail Assange didn’t do anything illegal, and under asylum laws, he had a right to skip bail. Once again, it’s not Assange who has broken laws, it’s everyone else involved in this tragic saga. And even if Assange had broken a law, he still would have had the right to proper medical care.

 

The US: Where to even start? The American hunt for Assange is a decade old and has recently escalated when they could get heir hands on the new Ecuador president. Then they invoked the much ridiculed 1917 Espionage Act to accuse a foreign national of spying. And whatever Assange has done, spying it is not.

But they obviously think they can get Eastern District of Virginia Judge Leonie Brinkema (aka the hanging judge) to pretend that it is, or at least that some of what he’s done falls under a law that almost everyone agrees should have been abolished long ago.

What Nils Melzer also mentioned in his report on Assange is that certain parts of the Espionage Act allow for the death penalty. Not those that he has been charged under so far, but they could attempt to stick them on. Which would make it illegal for the UK to extradite Julian Assange. But who still thinks these people give one flying hoot about the law?

For them, laws are things they use to further their means, nothing else. Other than that, they care nothing for the laws that govern their countries, even though they are the very same laws that allowed them to assume their power.

They think they’re going to get away with the murder of Julian Assange. Unhindered by any law. That means there no longer is a functioning -international- legal system. There are only rogue states left.

 

 

 

 

Jun 012019
 
 June 1, 2019  Posted by at 8:30 am Finance Tagged with: , , , , , , , , , ,  


 

Relentless and Unrestrained Public Mobbing, Intimidation and Defamation (CN)
UN Special Rapporteur Calls for Julian Assange to Be Freed (DN)
Assange ‘Psychologically Tortured To Breaking Point By Democratic States’ (RT)
Are US/UK Trying To Kill Assange? – Ron Paul (DM)
Assange May Have To Die Before Journalists Realize Implications – Galloway (RT)
36 Countries The US Has Bullied This Week (RT)
Prelude to a Fiasco (Jim Kunstler)
US Stock Market Forgoes $5 Trillion In Returns Due To Trade War – Deutsche (MW)
Dow 25,000! Oops…(WS)
Mexico Tariffs May Hurt $600 Billion In Cross-Border Trade, US Economy (MW)
Brazil Snubs Venezuelan Opposition Envoy As Doubts Rise On Guaido (R.)

 

 

NOTE: quite a few video’s today, which don’t always show if you receive this by mail. In that case, please refer to the Automatic Earth site.

 

 

“I’ve seen atrocities in war areas that were physically more horrible but I’ve never seen a single person pursued so relentlessly and with so little foundation.”

Relentless and Unrestrained Public Mobbing, Intimidation and Defamation (CN)

“It was obvious that Mr. Assange’s health has been seriously affected by the extremely hostile and arbitrary environment he has been exposed to for many years. Most importantly, in addition to physical ailments, Mr. Assange showed all symptoms typical for prolonged exposure to psychological torture, including extreme stress, chronic anxiety and intense psychological trauma.” “My most urgent concern is that, in the United States, Mr. Assange would be exposed to a real risk of serious violations of his human rights, including his freedom of expression, his right to a fair trial and the prohibition of torture and other cruel, inhuman or degrading treatment or punishment,” said Melzer.

He said he was “particularly alarmed” by the Espionage Act charges. “This may well result in a life sentence without parole, or possibly even the death penalty, if further charges were to be added in the future,” said Melzer. “[Assange] is really something I’ve never seen in 20 years,” Melzer said. “I’ve seen atrocities in war areas that were physically more horrible but I’ve never seen a single person pursued so relentlessly and with so little foundation. “[When I saw him] I immediately compared him to some of the graver cases in interrogation prisons in terms of his psychological reaction patterns. That’s what alarmed me so much.” He said Assange’s treatment was “very close to the intentional, purposeful infliction of coercive measures to try to break him”.

He appeared “extremely agitated and preoccupied,” Melzer said. “He asked a lot of questions and he would jump around, he was so preoccupied with everything he can’t even compute my answers any more. “There were episodes of this, then he was part of the conversation as normal, then again he would enter into this agitated state. I have seen with other victims of psychological torture that would happen.” Melzer also blasted the government of Assange’s native Australia. He told the newspaper, “Australia is a glaring absence in this case. They’re just not around, as if Assange was not an Australian citizen. That is not the correct way of dealing with that.”

 

Read more …

Interesting man for sure. This part of his report stands out:

“I believe we have to take a step back and look at all these proceedings, how they have been conducted, and come to our own conclusions whether these are fair. We also have to take a step back and look at this whole narrative of suspected rapist; narcissist; selfish, ungrateful person; hacker, and scratch the surface a little bit and see what’s below there.


When I was first approached by his defense team seeking protection from my mandate in December last year, I was reluctant to do so, because, me, too, I had been affected by this prejudice that I had absorbed through all these public, you know, narratives spread in the media over the years. And only when I scratched the surface a little bit, I saw how little foundation there was to back this up and how much fabrication and manipulation there is in this case. So I encourage everybody to really look below the surface in this case.”

UN Special Rapporteur Calls for Julian Assange to Be Freed (DN)

The United Nations special rapporteur on torture is warning that WikiLeaks founder Julian Assange is suffering from the effects of “psychological torture” due to his ongoing detention and threats of possible extradition to the United States. The U.N. expert, Nils Melzer, also warned that Assange would likely face a “politicized show trial” if he were to be extradited to the United States. Melzer writes, “In 20 years of work with victims of war, violence and political persecution, I have never seen a group of democratic states ganging up to deliberately isolate, demonize and abuse a single individual for such a long time.” Julian Assange is currently serving a 50-week sentence for skipping bail in 2012 at London’s Belmarsh Prison, after he was forcibly removed from the Ecuadorean Embassy by British police last month.


Last week, the U.S. Justice Department announced it was charging Assange with 17 counts of violating the Espionage Act for his role in publishing U.S. classified military and diplomatic documents exposing U.S. war crimes in Iraq and Afghanistan. Assange, who had already been charged on one count of hacking a government computer, now faces up to 170 additional years in prison under the new charges—10 years for each count of violating the Espionage Act. Assange was due to appear by video link before a magistrates’ court on Thursday but failed to appear, reportedly due to health problems. We speak with U.N. Special Rapporteur on Torture Nils Melzer.

Read more …

Nils Melzer did a whole range of interviews in one day.

Assange ‘Psychologically Tortured To Breaking Point By Democratic States’ (RT)

Jailed WikiLeaks co-founder Julian Assange shows clear signs of degrading and inhumane treatment which only adds to his deteriorating health, UN Special Rapporteur on Torture Nils Melzer told RT. Assange has “all the symptoms typical for a person who has been exposed to prolonged psychological torture,” Melzer told RT’s Afshin Rattansi. This adds to the toll of his deteriorating physical state caused by a lack of adequate medical care for several years, he said. Melzer said he was judging from two decades of experience in working with POWs and political prisoners, and only after applying “scientific” UN methods to assess Assange’s condition. But the journalist’s case still “shocked” him.


An individual has been isolated and singled out by several democratic states, and persecuted systematically… to the point of breaking him. Earlier this month, a UK court sentenced the WikiLeaks co-founder to nearly a year in jail for skipping bail in 2012. The courts are now deciding whether to extradite Assange to the US where he is wanted for 17 charges under the Espionage Act. He can end up serving up to 175 years in prison if proven guilty.

Read more …

Me too, I thought of Warmbier: “..how would we look a lot different to the North Koreans on the surface?’

Are US/UK Trying To Kill Assange? – Ron Paul (DM)

Former Congressman and presidential candidate Ron Paul says Julian Assange could die in prison and blames the apparent deterioration in the WikiLeaks founder’s heath on how he is being treated by the US and UK governments. Speaking on ‘Ron Paul Liberty Report, the 83-year-old accuses the US government of pursuing Assange and says they would like to either challenge him with a death penalty or a life time in prison ‘for being a journalist.’ The Libertarian calls Assange’s a ‘tragic story’ and describes his health as ‘very very bad,’ commenting that friends of the whistleblower are worried that his health may not hold up. [..] Paul also compares Assange’s plight to the case of Otto Frederick Warmbier, an American college student imprisoned in North Korea in 2016.


In June 2017, Warmbier was released by North Korea in a vegetative state and died soon afterward. Paul goes on to ask what the ramifications would be if Assange is much sicker than is being revealed and dies in prison as the result of how his case has been handled by Washington and London. ‘If he had a terminal disease or something happens to him, good, bad, or whatever and he dies in the prison, how would we look a lot different to the North Koreans on the surface?’ Paul questions. Paul goes on to slam the American media and journalists for their lack of reporting on Assange’s health problems, adding that news of his ill health came out via a Swedish newspaper. Paul adds there is ‘not much good journalism around any more’ and that by not doing more reporting on Assange, journalists ‘don’t want to protect their right to be a journalist.’

Read more …

They still wouldn’t realize a thing.

Assange May Have To Die Before Journalists Realize Implications – Galloway (RT)

“Julian Assange may have to die in the hospital wing of Belmarsh prison in order to bring it about” George Galloway believes it’s not long until ‘we could be in George Orwell’s 1984’ as he talks to In Question’s Manila Chan about the Wikileaks founder being too ill to appear at extradition hearing.

Read more …

The US will end up all alone.

36 Countries The US Has Bullied This Week (RT)


© Global Look Press / Uwe Skrzypczak

It’s been a busy few days for American diplomacy, with three dozen nations ending up at the receiving end of threats, ultimatums and sanctions this week alone. And it’s only Friday. Mexico is the latest target, slapped with 5 percent tariffs on each and every export, gradually increasing to 25 percent until it stops the flow of Latin American migrants into the US, thus fulfilling one of President Donald Trump’s election promises. Most of those migrants aren’t even from Mexico. On the other side of the world, India is reportedly about to be forced to face a choice: ditch the purchase of Russian S-400 air defense systems or face sanctions under the Countering America’s Adversaries Through Sanctions Act (CAATSA, Washington’s go-to cooperation enforcement instrument).

Turkey is facing a similar ultimatum: abandon S-400s (something Ankara has repeatedly refused to do) or lose access to the F-35 fighter jet program. This threat was repeated on Thursday by Kathryn Wheelbarger, US acting assistant secretary of defense for international security affairs. Ankara has already invested some $1.25 billion into the super-expensive American fighter, but with a lot of its parts being made in Turkey, it’s still an open question who would be the bigger loser. The entire European Union could be facing punishment if it tries to trade with Iran using its non-dollar humanitarian mechanism to bypass the American embargo. Having worked hard on the 2015 nuclear deal with Tehran, which has repeatedly been confirmed to be working, EU member states are not ready to ditch trade at Trump’s whim – and US Special Representative to Iran Brian Hook on Thursday reaffirmed the threat of CAATSA sanctions.

Read more …

”The object is solely to divert the nation’s attention with an impeachment circus, allowing Mr. Mueller to slip away harmlessly into history..”

Prelude to a Fiasco (Jim Kunstler)

You’d think that Robert Mueller might know what any licensed attorney-at-law in the land tells a client in a tight spot with a lame alibi: better keep you mouth shut. Instead, Mr. Mueller crept Sphinx-like out of the Deep State woodwork on little cat’s paws and in a brief nine minutes blabbed out a set of whopperish riddles much more likely to get himself in trouble than the target of his hinky inquisition. The key whopper was that he could not make “a determination” on an obstruction-of-justice charge against Mr. Trump because guidance policy from the DOJ’s Office of Legal Counsel had said some years ago that a sitting president can’t be indicted. That is not what he told his boss, Mr. Barr, the Attorney General (and a roomful of the AG’s staffers who heard it), in person when he delivered his final report a few weeks ago.

Upon receipt of that report, Mr. Barr asked the Special Counsel three times whether his inability to conclude anything on an obstruction charge was due to the OLC guidance, and three times Mr. Mueller answered “no.” Mr. Barr relayed this on-the-record in testimony before the House Judiciary Committee and, as averred above, he has plenty of witnesses. It should not be hard to reach a determination on who is telling truth here. In fact, Mr. Mueller could have declared that he found chargeable obstruction crimes were committed based on the evidence, and also demurred to press them at this time — leaving them available to federal prosecutors until after the president was out of office, one way or another.

The reason he didn’t is that Mr. Mueller does not want the case to come to trial, ever, because he would lose badly and his reputation would be destroyed. Consider that in any trial, the defendant gets to call witnesses and make his own case. The evidence for gross prosecutorial misconduct on the part of Mr. Mueller and his associates is mountainous compared to the molehill of Mr. Trump’s temper tantrums over the seditious hoax he was subject to. And that matter is now moving in the direction of adjudication. So instead, Mr. Mueller has set in motion a potential political crisis as momentous as the Civil War, but completely unlike it.

Knowing that congress can impeach the president on just about anything — especially this president, publicly reviled like no other before him — he served congress the platter of material to use in the form of his final report, and pretty much dared them to not go forward with it. Get this: it is a ruse. The object is solely to divert the nation’s attention with an impeachment circus, allowing Mr. Mueller to slip away harmlessly into history without sacrificing his own reputation in a courtroom.

Read more …

We like big numbers.

US Stock Market Forgoes $5 Trillion In Returns Due To Trade War – Deutsche (MW)

The U.S. stock market has left $5 trillion on the table as trade tensions over the past 17 months contributed to an effectively sideways trade, Deutsche Bank estimated on Friday. “While other factors also arguably played a role, the trade war has been key in preventing a recovery in global growth and keeping U.S. equities range bound. Foregone U.S. equity returns from price appreciation for 17 months are worth $5 trillion,” wrote Binky Chadha, the bank’s chief strategist, in a Friday note, based on an price appreciation at an annual rate 12.5% (see chart below).

Chadha’s calculation is based on the capitalization of the Russell 3000, a broad measure of equity markets, which had a capitalization of $28.7 trillion at the start of 2018. Foregone returns for the index over 17 months comes out to $5 trillion. The S&P 500 in the first four months of 2019 bounced back sharply from a steep fourth-quarter selloff nudging to an all-time closing high in April. But the index has retreated more than 6% in May, posting its first monthly decline since December and its worst May performance since 2010. The Dow Jones Industrial Average which failed to return to record territory before the May swoon, also fell more than 6% for the month.

Read more …

What $20 trillion in stimulus bought you.

Dow 25,000! Oops…(WS)

Stocks were already gunning for the worst May since 2010 when, on the evening before the last trading day, Trump tweeted that he would impose tariffs on imports from Mexico, if Mexico doesn’t crack down on migration flows coming through its southern border. Those tariffs would hit the automakers particularly hard because they imported 2.6 million vehicles from Mexico in 2018, up 10% from the prior year. Not even counting the component makers. But the Presidential tweet was just the icing on the cake. May had been crappy for stocks before the tweet went out.


The S&P 500 index, which earlier this week had fallen through 2,800, dropped another 1.3% today to 2,752, down 6.8% from its peak in early May that had exceeded by a hair the prior peak of September 2018. The index is now back where it had first been on January 9, 2018, having spent nearly 17 months going nowhere, despite intoxicating surges and nerve-wracking drops. And the chart is morphing from “not pretty” to something a little uglier (data via S&P Dow Jones Indices):

The Dow Jones Industrial Average fell 1.1% today, unceremoniously plopping through the 25,000 level and closed at 24,815. It’s now 7.9% below its October 2018 peak and right back where it had first been in December 2017, having spent 17 months gyrating to nowhere, including a 19% peak-to-trough plunge in four months followed by a blistering 22% rally in four months. The Nasdaq composite dropped 1.5% today, to 7,453, the level it first reached in January 2018, also going nowhere in nearly 17 months despite a huge bout of volatility. It fell 8.7% in May. The Russell 2000 index, which covers stocks with smaller market capitalization, fell 1.3% today, to 1,478. It’s down 9.2% in May alone, down 15.7% from its October 2018 peak, and right back where it had first been on September 26, 2017, a very volatile 20 months of going nowhere. Chart looking ugly (data via Investing.com):

Read more …

This just might go horribly wrong.

Mexico Tariffs May Hurt $600 Billion In Cross-Border Trade, US Economy (MW)

The U.S. economy could suffer a wrenching blow, business leaders and economists say, if President Trump follows through on his threat to slap tariffs on all imports from Mexico in a dispute over immigration controls. The president on Thursday said he would apply a 5% tariff on $350 billion in imports from Mexico unless the country reduces the flow of immigrants seeking to enter the United States. The surprise move slammed the stock market and prompted an immediate backlash from business. “These proposed tariffs would have devastating consequences,” said Jay Timmons, president of the National Association of Manufacturers. “Workers should not be forced to suffer because of the failure to fix our immigration system.”

Households could face higher prices for groceries and other key consumer staples, economists say. And businesses would have to pay more for key parts and materials, especially in the auto industry. “The duties represent a significant risk to business activity both north and south of the border,” said chief economist Gregory Daco of Oxford Economics. He said Mexico could be thrown into recession while U.S. growth could fall to 1% or less by 2020. The economies of the U.S. and Mexico have become inextricably intertwined in the quarter of a century since the North American Free Trade Agreement deal was signed in 1994. The two countries exchanged a whopping $612 billion in goods last year, making Mexico the third largest trading partner after Canada and China. More than $1.5 billion in products cross the border between the two countries every day.


Although Mexico is popularly known as the main U.S. source for avocados and tequila, the huge amount of products it sends to its northern neighbor each year touch almost every major segment of America’s economy. The U.S. imports enormous quantities of autos and parts, computer equipment, oil and gas, appliances and plastic and rubber products — not to mention fruits and vegetables such as tomatoes, berries and melons. Mexican imports in 2018 hit a record $347 billion.

Read more …

Geez, is that still on?

Brazil Snubs Venezuelan Opposition Envoy As Doubts Rise On Guaido (R.)

Brazil withdrew an invitation to the envoy for Venezuelan opposition leader Juan Guaido to present her diplomatic credentials, she said on Friday, and the government in Brasilia said it would decide later whether to accept them. Brazilian President Jair Bolsonaro still recognises Guaido as the legitimate president of Venezuela, his spokesman said. Guaido’s envoy, Maria Teresa Belandria, played down the idea that the snub reflected scepticism from Bolsonaro’s government. Diplomatic analysts said mounting evidence that a change of government in Venezuela is not imminent may have Bolsonaro and his aides wondering if they overplayed their support for Guaido.


Former military officers making up about a third of Brazil’s cabinet have been wary of provoking Venezuelan President Nicolas Maduro, warning against moves that could tip an economic and political crisis into violence across Brazil’s northern border. Belandria had been invited to present her credentials at the presidential palace along with ambassadors from other countries next Tuesday, but the government changed its mind. “I was uninvited,” she told Reuters, but went on to dismiss any suggestion the snub reflected diminished support for Guaido. “There will be another opportunity,” she said. “Brazil’s support continues to be strong, solid and decisive. It’s merely a protocol matter.”

Read more …

 

Julian on Google

 

 

 

 

May 312019
 
 May 31, 2019  Posted by at 9:01 am Finance Tagged with: , , , , , , , , , , ,  


 

Julian Assange Shows Psychological Torture Symptoms – UN Expert (G.)
Julian Assange Must Never Be Extradited (Matt Taibbi)
The Unrelenting State (Craig Murray)
Trump Announces Tariffs On Mexico Until ‘Immigration Problem Remedied’ (G.)
Futures, Peso Tumble As Trump Unleashes Tariffs On Mexico (ZH)
GOP Senator Grassley Blasts Trump Over Mexico Tariff Threat (Hill)
Russiagate Is #1 Threat To US National Security – Stephen Cohen (RT)
Malaysia PM Wants Evidence To Show Russia Shot Down MH17 (FMT)
Boeing Admits It ‘Fell Short’ On Safety Alert For 737 (BBC)
Yield-Curve Spaghetti (WS)
Ted Cruz, AOC Agree To Ban Former Congress Members From Becoming Lobbyists (G.)

 

 

Time is ticking away.

Julian Assange Shows Psychological Torture Symptoms – UN Expert (G.)

Julian Assange is showing all the symptoms associated with prolonged exposure to psychological torture and should not be extradited to the US, according to a senior UN expert who visited him in prison. Nils Melzer, UN’s special rapporteur on torture, is expected to make his appeal to the UK government on Friday. It comes after Assange, the co-founder of WikiLeaks, was said by his lawyers to be too ill to appear by video link for the latest court hearing of the case on Thursday. Assange has been moved to the health ward of Belmarsh prison, London, where he has been serving a 50-week sentence for skipping bail while fighting extradition to the US.

He is accused of violating the Espionage Act by publishing secret documents containing the names of confidential US military and diplomatic sources. After meeting Assange earlier this month in the company of medical experts who examined him, Melzer will say on Friday that he fears the Australian’s human rights could be seriously violated if he is extradited to the US and will condemn what he describes as the “deliberate and concerted abuse inflicted for years” on him. “Physically there were ailments but that side of things are being addressed by the prison health service and there was nothing urgent or dangerous in that way,” Melzer said.

“What was worrying was the psychological side and his constant anxiety. It was perceptible that he had a sense of being under threat from everyone. He understood what my function was but it’s more that he was extremely agitated and busy with his own thoughts. It was difficult to have a very structured conversation with him.” [..] The lawyer [..] said that his office had been approached by Assange’s lawyers in December. But he said that he was initially reluctant to do so, admitting he was affected by what he called the “prejudice” around the case.However, he began looking into the case again in March and, earlier this week, wrote letters to the foreign ministers of the US, the UK and Sweden.

“In the course of the past nine years, Mr Assange has been exposed to persistent, progressively severe abuse ranging from systematic judicial persecution and arbitrary confinement in the Ecuadorian embassy, to his oppressive isolation, harassment and surveillance inside the embassy, and from deliberate collective ridicule, insults and humiliation, to open instigation of violence and even repeated calls for his assassination,” Melzer will say on Friday. He added the UK authorities had contacted his Geneva office to indicate that the British government would be issuing a point-by-point rebuttal of the assertions made in his letter. [..] “In 20 years of work with victims of war, violence and political persecution I have never seen a group of democratic states ganging up to deliberately isolate, demonise and abuse a single individual for such a long time and with so little regard for human dignity and the rule of law.”

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I doubt Orwell ever knew how right he was.

Julian Assange Must Never Be Extradited (Matt Taibbi)

WikiLeaks founder Julian Assange today sits in the Belmarsh High Security prison in southeast London. Not just for his sake but for everyone’s, we now have to hope he’s never moved from there to America. The United States filed charges against Assange early last month. The case seemed to have been designed to assuage fears that speech freedoms or the press were being targeted. That specific offense was “computer hacking conspiracy” from back in 2010. The “crime” was absurdly thin, a claim that Assange agreed (but failed, apparently) to try to help Chelsea Manning develop an administrative password that could have helped her conceal identity as she downloaded secrets. One typewritten phrase, “No luck so far,” was the damning piece of evidence.

The troubling parts of that case lurked in the rest of the indictment, which seemed to sell normal journalistic activity as part of the offense. The government complained that Assange “took measures to conceal Manning as the source of the disclosure.” Prosecutors likewise said, “Assange encouraged Manning to provide information and records from departments and agencies of the United States.” The indictment stressed Assange/Manning were seeking “national defense information” that could be “used to the injury of the United States.” The indictment likewise noted that the pair had been guilty of transmitting such information to “any person not entitled to receive it.” It was these passages that made me nervous a month and a half ago, because they seemed to speak to a larger ambition.

Use of phrases like “national defense information” given to persons “not entitled to receive it” gave off a strong whiff of Britain’s Official Secrets Acts, America’s Defense Secrets Act of 1911 (which prohibited “national defense” information going to “those not entitled to receive it”) and our Espionage Act of 1917, which retained many of the same concepts. All of these laws were written in a way that plainly contradicted basic free speech protections. The Espionage Act was revised in 1950 by the McCarran Internal Security Act, sponsored by Nevada Senator Pat McGarran (who incidentally was said to be the inspiration for the corrupt “Senator Pat Geary” character in The Godfather). The change potentially removed a requirement that the person obtaining classified information had to have intent to harm the country.

There was a way to read the new law that criminalized what the Columbia Law Review back in 1973 (during the Pentagon Papers controversy) called the “mere retention” of classified material. This provision buried in subsection 793 of the Espionage Law has, since passage, been a ticking time bomb for journalism. The law seems clearly to permit the government to prosecute anyone who simply obtains or receives “national defense” information. This would place not only sources who steal and deliver such information at risk of prosecution, but also the journalists who receive and publish it. If the government ever decided to start using this tool to successfully prosecute reporters and publishers, we’d pretty quickly have no reporters and publishers.

I’m not exaggerating when I say virtually every reporter who’s ever done national security reporting has at some time or another looked at, or been told, or actually received copies of, “national defense” information they were technically “not entitled to receive.

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Britain employs torture. What do its own laws say about that?

The Unrelenting State (Craig Murray)

We are seriously worried about the condition of Julian Assange. He was too unwell to appear in court yesterday, and his Swedish lawyer, Per Samuelson, found him in a state where he was unable to conduct a conversation and give instructions. There are very definite physical symptoms, particularly rapid weight loss, and we are not satisfied that genuine and sufficient diagnostic efforts are being made to determine the underlying cause. Julian had been held for the last year in poor, highly confining and increasingly oppressive conditions in the Ecuadorean Embassy and his health was already deteriorating alarmingly before his expulsion and arrest.

A number of conditions, including dental abcesses, can have very serious consequences if long term untreated, and the continual refusal by the British government and latterly the Ecuadoreans to permit him access to adequate healthcare while a political asylee was a callous denial of basic human rights. I confess to feeling an amount of personal relief after his arrest that at least he would now get proper medical treatment. However there now seems to be no intention to provide that and indeed since he has been in Belmarsh his health problems have accelerated. I witnessed enough of the British state’s complicity in torture to know that this may be more than just the consequence of unintended neglect. That the most lucid man I know is now not capable of having a rational conversation is extremely alarming.

There is no rational reason that Assange needs to be kept in a high security facility for terrorists and violent offenders. We are seeing the motive behind his unprecedented lengthy imprisonment for jumping police bail when he entered political asylum. As a convicted prisoner, Assange can be kept in a worse regime than if he were merely on remand for his extradition proceedings. In particular, his access to his lawyers is extremely restricted and for a man facing major legal proceedings in the UK, USA and Sweden it is impossible, even were he healthy, for his lawyers to have sufficient time with him adequately to prepare his cases while he is under the restrictions placed on a convict. Of course we know from the fact that, within three hours of being dragged from the Ecuadorean Embassy, he was already convicted and sentenced to a lengthy prison term, that the state has no intention that his lawyers should be able to prepare.

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It’s like hammering in a nail with a pair of scissors.

Trump Announces Tariffs On Mexico Until ‘Immigration Problem Remedied’ (G.)

In a surprise announcement that could compromise a major trade deal, Donald Trump announced on Thursday that he is slapping a 5% tariff on all Mexican imports to pressure the country to do more to crack down on the surge of Central American migrants trying to cross the border. He said the percentage would gradually increase “until the Illegal Immigration problem is remedied”. Trump made the announcement by tweet after telling reporters earlier Thursday that he was planning “a major statement” that would be his “biggest” so far on the border. “On June 10th, the United States will impose a 5% Tariff on all goods coming into our Country from Mexico, until such time as illegal migrants coming through Mexico, and into our Country, STOP. The Tariff will gradually increase until the Illegal Immigration problem is remedied,” he wrote, “at which time the Tariffs will be removed.”


Mexico’s president, Andrés Manuel López Obrador, responded with a two-page letter to Trump on Thursday night. “The Statue of Liberty is not an empty symbol,” he said. “With all due respect, even though you have the right to say it, ‘make America great again’ is a fallacy because, until the end of times, and beyond national borders, universal justice and fraternity should prevail,” he wrote. Amlo, as the president is commonly called, offered his US counterpart history lessons on past periods of cordial US-Mexico relations. He also included details of his plans to develop Central America to stop migration and warned: “I don’t lack courage, I’m not a coward nor timid, rather, I act on principles.”

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“The only way the S&P 500 doesn’t sink massively today is if Trump rows back on this.”

Futures, Peso Tumble As Trump Unleashes Tariffs On Mexico (ZH)

Update 2: some borderline apocalyptic observations from Bloomberg markets live managing editor, Mark Cudmore who writes the following: “This Mexico tariff news is far worse than even the initial market reaction makes it out to be. The timing is almost immediate. Chaos for both companies and bureaucrats. No time for anyone to prepare or make contingencies. The only way the S&P 500 doesn’t sink massively today is if Trump rows back on this. The U.S. imported almost $350b worth of goods from Mexico in 2018. What makes it even worse again, if possible, is that so many traders were hoping Trump would soon take a more conciliatory trade zone because U.S. stocks have weakened. This is a black swan event for markets and people aren’t even registering. Maybe traders are all hoping there’s some mistake or that this won’t be implemented.”


Update 1: it’s going from bad to worse, with the White House warning that it will hike Mexico tariffs to 25% by October 1, if the border crisis persists, as Trump is activating a scorched earth approach whereby he will “punish” any offshore nation that he believes is transgressing, by imposing tariffs. Meanwhile, moments after Trump’s shock tweet, the Mexican deputy foreign minister Seade said that if President’s threat to impose tariffs is carried out, “it would be disastrous”, and Mexico would “respond strongly”, adding that “we will not remain with out arms folded” before the tariff deadline “to see if it is serious.”

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“Trade policy and border security are separate issues.”

GOP Senator Grassley Blasts Trump Over Mexico Tariff Threat (Hill)

Senate Finance Committee Chairman Chuck Grassley (R-Iowa) condemned President Trump’s new tariffs on Mexico late Thursday, calling the move a “misuse” of presidential tariff authority and cautioning the levies could derail passage of the United States-Mexico-Canada Agreement (USMCA). “Trade policy and border security are separate issues. This is a misuse of presidential tariff authority and counter to congressional intent,” Grassley said in a statement. The lawmaker cautioned that following through on Trump’s tariff threat “would seriously jeopardize passage of USMCA,” a revision of the North American Free Trade Agreement (NAFTA).


“I support nearly every one of President Trump’s immigration policies, but this is not one of them,” he added. Trump announced he would impose the tariffs to pressure Mexico to stop the flow of migrants into the U.S. via the southern border. [..] Grassley had previously threatened to derail Trump’s central trade achievement over continued steel and aluminum tariffs. Last week, Trump hinted that he had reached a deal to drop those tariffs, paving the way for the USMCA in the Senate.

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“This is the worst scandal in American history. It’s the worst, at least, since the Civil War.”

Russiagate Is #1 Threat To US National Security – Stephen Cohen (RT)

The systemwide US Russophobia that reached its nadir with Russiagate has created a “catastrophe” for both domestic politics and foreign relations that threatens the future of the American system, professor Stephen Cohen tells RT. War with Russia could easily break out if the US insists on pursuing the policy of “demonization” that birthed Russiagate instead of returning to detente and cooperation, New York University professor emeritus of Russian history Stephen Cohen argues on Chris Hedges’ On Contact. While NATO deliberately antagonized post-Soviet Russia by expanding up to its borders, the US deployed missile defense systems along those borders after scrapping an arms treaty, leaving President Vladimir Putin devoid of “illusions” about the goodwill of the West – but armed with “nuclear missiles that can evade and elude any missile defense system.”


Cohen believes the conspiracy theory – which remains front-page news in US media despite being thoroughly discredited, both by independent investigators and last month by special counsel Robert Mueller’s report – is the work of the CIA and its former director, John Brennan, who are dead set against any kind of cooperation with Russia. Attorney General William Barr, who is investigating the FBI over how the 2016 counterintelligence probe began, should take a look at Brennan and his agency, Cohen says. “If our intelligence services are off the reservation to the point that they can first try to destroy a presidential candidate and then a president…we need to know it,” Cohen says. “This is the worst scandal in American history. It’s the worst, at least, since the Civil War.” And the damage wrought by this “catastrophe” hasn’t stopped at the US border.

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“We don’t know why we are excluded from the examination but from the very beginning, we see too much politics in it.”

Malaysia PM Wants Evidence To Show Russia Shot Down MH17 (FMT)

The Malaysian government wants strong evidence to show that Russia is responsible for the Malaysia Airlines flight MH17 tragedy in 2014, said Prime Minister Dr Mahathir Mohamad today. He said Malaysia accepted the investigation report of Holland but only up to the point where the plane was brought down by a missile made by Russia. Mahathir said while the government agreed that the plane was brought down by a Russian missile, it cannot be certain that the missile was launched by Russia. “They are accusing Russia but where is the evidence? We know the missile that brought down the plane is a Russian-type missile, but it could also be made in Ukraine. “You need strong evidence to show it was fired by the Russians.

“It could be by the rebels in Ukraine; it could be Ukrainian government because they too have the same missile,” he said during a dialogue and media conference with the Japanese Foreign Correspondents Club (FCCJ) here today. Mahathir said people of Russia are military people and they would know that MH17 is a passenger plane. “I don’t think a very highly disciplined party is responsible for launching the missile,” he said. The prime minister said Malaysia should also be involved in examining the black box as the plane belongs to Malaysia and there were Malaysian passengers. “We may not have the expertise but we can buy the expertise. For some reason, Malaysia was not allowed to check the black box to see what happened.

“We don’t know why we are excluded from the examination but from the very beginning, we see too much politics in it. “The idea was not to find out how this happened but seems to be concentrated on trying to pin it on the Russians. This is not a neutral kind of examination,” said Mahathir. “Had a neutral party examined and made the conclusion, Malaysia is willing to accept the findings but here we have parties with political interests in the matter,” he added.

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Why is the CEO still in office?

Boeing Admits It ‘Fell Short’ On Safety Alert For 737 (BBC)

Boeing has admitted it “fell short” when it failed to implement a safety alert system on the 737 Max. The aircraft was grounded globally in March after two crashes within months. Boeing boss Dennis Muilenburg said a mistake had been made in the software for a cockpit warning light called an “angle-of-attack (AOA) disagree alert”. He said: “We clearly fell short and the implementation of this angle-of-attack disagree alert was a mistake, right, we did not implement it properly.” In an interview with Norah O’Donnell of CBS News he said Boeing was now fixing the problem.


The alert could have notified pilots and maintenance crews that there was a problem early in the flight. One flight safety expert said if there had been an AOA disagree alert on board the Ethiopian airlines flight it “would have been the very first clue” for the pilots that something was wrong. Chris Brady, a pilot and author of The Boeing 737 Technical Guide said: “I’m fairly confident that the Ethiopian Airlines flight probably would not have crashed if they had had the AOA disagree alert” on the aircraft.

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“This is getting pretty nutty, when you think about it.”

Yield-Curve Spaghetti (WS)

On Thursday, the US Treasury yield curve sagged further in the middle, producing an ever more beautiful middle-age sag, so to speak, that first started taking shape late last year. The chart shows the yield curves on seven dates. Each line represents the yields from the 1-month yield on the left to the 30-year yield on the right, on that date. The steep green line coming up from the bottom represents the yields on December 14, 2016, when the Fed got serious about rate hikes — the steep slope, with short-term yields a lot lower than long-term yields, is what a yield curve in normal-ish times is supposed to look like. The beautifully sagging red line represents the yields today, May 30. The entire portion of the yield curve from the 3-year yield through the 10-year yield has now dropped by over 1 percentage point since the peak on November 8, 2018.

Some more standouts: The 3-year yield inched down to 2.00%, the lowest since January 2, 2018, forming the low point of the middle-age sag. On Nov 8, it was at 3.05%. The 10-year yield dipped to 2.22%, lowest since Sep 18, 2017, and below 1-year and shorter maturities; but it remains above the 2-year yield and in this cycle has not inverted with the 2-year yield yet. The 1-month yield ticked up to 2.37%, from 2.35% yesterday, which had been the bottom of its range, and as is to be expected, right in the middle of the Fed’s target range for the federal funds rate (2.25% -2.50%). The 6-month yield had been anchored since late October at round 2.5%, with only slight variations. It now too has dropped out of this range and hit 2.38% over the past two days but ticked up to 2.40% today. The 30-year yield dropped to 2.65%, the lowest since Nov 7, 2016. This is getting pretty nutty, when you think about it.

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AOC should be focusing all her energy on Assange.

Ted Cruz, AOC Agree To Ban Former Congress Members From Becoming Lobbyists (G.)

A conversation on Twitter has led to an unlikely collaboration between the Republican senator Ted Cruz and the Democratic representative Alexandria Ocasio-Cortez to pass legislation targeting lobbying by former members of Congress. The two lawmakers tweeted support of placing restrictions or a potential lifetime ban on former Congress members becoming lobbyists. The conversation began when Ocasio-Cortez tweeted a study from Public Citizen that found 60% of former Congress members had taken jobs influencing federal policy. “If you are a member of Congress and leave, you shouldn’t be allowed to turn right around and leverage your service for a lobbyist check,” she wrote.


Cruz retweeted Ocasio-Cortez, suggesting bipartisan legislation to fight the Washington political “swamp”. The Republican House representative Chip Roy tweeted that he would help Ocasio-Cortez spearhead the effort. She agreed to create a bipartisan team in the House while Cruz forms one in the Senate to write a ban. [..] Previous efforts to prevent lobbying from former congresspeople have been put forth but not passed, including a 2017 bill co-sponsored by the Republican senator Cory Gardner and the Democratic senators Michael Bennet and Al Franken. Also in 2017, Senator Jon Tester of Montana introduced legislation that would ban lawmakers from lobbying their former colleagues until five years after leaving office, but it failed to gain traction.

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Nov 212018
 
 November 21, 2018  Posted by at 10:07 am Finance Tagged with: , , , , , , , , , , , , ,  


Jack Delano Lower Manhattan 1941

 

Senate Calls On Trump For Saudi Answers (BBC)
Saudi Arabia Tortured Female Right-to-Drive Activists – Amnesty (AP)
Trump Submits Answers To Robert Mueller Questions In Russia Probe (Ind.)
Trump Wanted To Order Justice Dept To Prosecute Clinton, Comey – NYT (R.)
Dow Plunges More Than 500 Points, Erases Gain For 2018 (CNBC)
Stunned Investors Observe The Market Carnage In Shock (ZH)
A Death Cross Is Forming In US Oil (MW)
Bitcoin Plunges As Much As 16% To Below $4,100, A New Low For The Year (CNBC)
Misguided Share Buybacks Are Hollowing Out Companies’ Balance Sheets (MW)
Bank of England Backs Theresa May’s Brexit Deal, Warns Of No-Deal Dangers (G.)
May’s Brussels Trip Only Start Of ‘Endless’ EU Trade Talks (G.)
UK To Be ‘Frozen Out’ Of 182 EU Decisions During Brexit Transition (Ind.)
Interpol Elects South Korean As Its President In Blow To Russia (G.)
Tax ‘Virgin Packaging’ To Tackle Plastics Crisis – Report (G.)
Dead Whale Washes Ashore In Indonesia With 6 Kilos Of Plastic In Stomach (AP)
Julian Assange Deserves A Medal of Freedom, Not A Secret Indictment (USA Today)

 

 

The indignation over Trump’s comments on Saudi Arabia is shifting into overdrive. Perhaps that’s needed to expose the hypocrisy inherent in them. It’s not Trump, it’s America that has condoned torture and murder by the House of Saud for decades. That started actively assisting the Saudi’s in Yemen under Obama. Trump refuses to be set up by the media and Democrats as the fall guy for $150 oil prices. He’s thinking: let Congress do it, now that it’s blue. If that’s immoral, he’s not alone.

Senate Calls On Trump For Saudi Answers (BBC)

US President Donald Trump has been asked to ascertain whether Saudi Crown Prince Mohammed bin Salman played a role in the murder of Jamal Khashoggi. Republican and Democratic leaders of the US Senate Foreign Relations Committee on Tuesday sent a letter demanding a second investigation. Mr Trump earlier defended US ties with Saudi Arabia despite international condemnation over the incident. Khashoggi was killed on 2 October inside the Saudi consulate in Istanbul. In a statement on Tuesday, Mr Trump acknowledged that the crown prince “could very well” have known about Khashoggi’s brutal murder, adding: “Maybe he did and maybe he didn’t!”

He later stated that the CIA had not made a “100%” determination on the killing. Following the president’s comments, Republican Senator Bob Corker and Democrat Bob Menendez issued a statement on behalf of the Senate Foreign Relations Committee. In it they called on Mr Trump to focus a second investigation specifically on the crown prince so as to “determine whether a foreign person is responsible for an extrajudicial killing, torture or other gross violation” of human rights. The request, issued under the Global Magnitsky Human Rights Accountability Act, requires a response within 120 days.

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OK, CNN, do your job.

Saudi Arabia Tortured Female Right-to-Drive Activists – Amnesty (AP)

Several activists imprisoned in Saudi Arabia since May, including women who campaigned for the right to drive, have been beaten and tortured during interrogation, Amnesty International has said. Saudi Arabia has detained at least 10 women and seven men on vague national security allegations related to their human rights work, the organisation said on Tuesday. Those detained include Loujain al-Hathloul, Eman al-Nafjan and Aziza al-Yousef, who had campaigned for the right to drive before the decades-long ban was lifted in June. Amnesty said that according to three testimonies it obtained, some of the activists were repeatedly given electric shocks and flogged, leaving some unable to walk or stand properly. In one instance, an activist was hung from the ceiling.

Another testimony said one of the detained women was subjected to sexual harassment by interrogators wearing face masks. The kingdom is at the centre of an international firestorm after the killing of Saudi journalist Jamal Khashoggi, who had written critically about Crown Prince Mohammed bin Salman’s crackdown on dissent, including the arrests of the women activists. Khashoggi was killed and then dismembered by Saudi agents in the kingdom’s consulate in Istanbul on 2 October. Lynn Maalouf, Amnesty’s Middle East research director, said: “Only a few weeks after the ruthless killing of Jamal Khashoggi, these shocking reports of torture, sexual harassment and other forms of ill-treatment, if verified, expose further outrageous human rights violations by the Saudi authorities.”

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What a waste of resources.

Trump Submits Answers To Robert Mueller Questions In Russia Probe (Ind.)

Donald Trump has submitted written answers to questions from Special Counsel Robert Mueller as part of the probe into Russian meddling in the 2016 election and possible collusion with the Trump campaign. “We answered every question they asked that was legitimately pre-election and focused on Russia,” Trump lawyer Rudy Giuliani said in an interview. “Nothing post-election. And we’ve told them we’re not going to do that.” Mr Giuliani said Trump did not plan to answer any questions from Mr Mueller on whether he tried to obstruct the investigation once he won office, such as by firing former FBI Director James Comey last year. “It is time to bring this inquiry to a conclusion,” the lawyer said in an earlier statement on the probe, which Mr Trump has repeatedly called a “witch hunt.”

Mr Trump signed the submission on Tuesday before he left Washington to spend the Thanksgiving holiday in Florida, a person familiar with the matter said. Mr Mueller was tasked to probe “any matters that arose or may arise directly from the investigation” into possible collusion between Mr Trump’s campaign and Russia during the 2016 election. [..] Mr Giuliani said in his statement the president had provided “unprecedented cooperation” with the probe over the past year and a half, noting that more than 30 White House-related witnesses had been questioned and 1.4 million pages of material turned over before Mr Trump responded to the pre-election questions in writing. He added that “much of what has been asked raised serious constitutional issues and was beyond the scope of a legitimate inquiry.”

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Not exactly news, is it? Of course there will be an investigation of Hillary, Comey and a whole circus around them. It would be a serious perverson of justice if there isn’t.

Trump Wanted To Order Justice Dept To Prosecute Clinton, Comey – NYT (R.)

U.S. President Donald Trump wanted to order the Justice Department to prosecute two political foes, his one-time presidential opponent Hillary Clinton and former FBI director James Comey, in the spring, but his White House counsel rebuffed him, the New York Times reported on Tuesday. Don McGahn, the White House counsel at the time, wrote a memo to the president outlining consequences for Trump if he did order these prosecutions. The outcomes ranged from the traditionally independent Justice Department refusing to comply, to congressional probes and voter outcry, the Times reported.

The New York Times also reported Trump’s lawyers privately asked the Justice Department to investigate Comey for mishandling sensitive government information and his role investigating Clinton’s use of a private email account and server, but law enforcement officials declined. It was not clear if Trump read the memo or pursued the prosecutions further, the New York Times said. It was also not clear what specific charges Trump wanted the Justice Department to pursue against Comey and Clinton, the Times reported. Trump has publicly railed against Clinton’s private email use during her tenure as U.S. Secretary of State, as well as her role in the Obama administration’s decision to allow a Russian company to buy a uranium mining firm.

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Time to start writing about finance again?!

Dow Plunges More Than 500 Points, Erases Gain For 2018 (CNBC)

The Dow Jones Industrial Average and S&P 500 fell sharply on Tuesday and turned negative for the year as a decline in Target shares pressured retailers, while some of the most popular tech shares dropped again. The 30-stock Dow dropped 551.80 points to 24,465.64 and the S&P 500 plunged 1.8 percent to close at 2,641.89. The Dow and S&P 500 were up 1.2 percent and 0.6 percent, respectively, for 2018 entering Tuesday. Meanwhile, the Nasdaq Composite also dropped 1.7 percent to 6,908.82 but managed to hang on to a slight gain for 2018. Tuesday’s declines come after the Dow dropped 395 points on Monday.

Stocks hit their lows of the day after Doubleline Capital founder Jeffrey Gundlach said stocks are still too expensive, adding there has not been a “panic low” yet. The Dow was down nearly 650 points at its session low, while the S&P 500 and Nasdaq had both dropped more than 2 percent. Target fell 10.5 percent after reporting weaker-than-expected earnings for the previous quarter. The company also posted lighter-than-forecast same-store sales, which is a key metric for retailers.

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Nah, they’re not investors.

Stunned Investors Observe The Market Carnage In Shock (ZH)

After another abysmal day, in which every single sector in the market closed in the red as stocks tumbled 2%, capping a dreadful two-month stretch since the S&P hit its all time highs exactly two months ago, which has seen both the S&P and the Dow turn red for the year with the Nasdaq just barely holding onto green, while oil crashed 6% slumping to a one year low, junk bonds matched a record streak of losses, the overall market just suffered one of its worst sessions in the past three years. But what is most remarkable is the following chart from Bloomberg which shows the year-to-date return of the best performing asset between US and global equities, corporate bonds, Treasuries, gold and real cash, and according to which 2018 is shaping up as what may be the worst year on record for cross-asset investors. Indeed, nothing at all has worked this year!

The inability of any single asset class to escape the dismal black hole supergravity of devastating losses in a brutal post-BTFD catharsis that has mutated into an equal-opportunity rout, crushing returns across all assets, has left investors reeling, shellshocked and paralyzed, and dreading what may come tomorrow let alone next year when both the US economy and corporate earnings are expected to see their supercharged recent growth rates come crashing back down to earth. “While there’s still no ‘panic in the streets,’ most traders are unconvinced that the selling will slow down anytime soon,” said Instinent’s head of trading Larry Weiss. “The flight to quality is now a flight to cash. It’s tough to convince anyone that now is the time to put money to work.”

[..] Hedge funds, who hoped that “buy the dip” would work one last time and who rushed into the traditional “safety” of tech stocks at the end of October, were whipsawed, and turned net sellers this month, with the group accounting for the most selling among major industries according to Goldman Sachs. Meanwhile, as if sensing the coming storm, Goldman writes that hedge fund net exposures steadily declined throughout 2018, including during 2Q and 3Q while the broad equity market rallied, leaving most investors in the cold. Net long exposure calculated based on 13-F filings and publicly-available short interest data registered 49% at the start of 4Q, a decline from 56% at the start of 2018, and one of the lowest in years.

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Potential volatility in oil is huge. Any little shrapnel of news, Saudi, Iran, Russia, shale, can force prices up 50%.

A Death Cross Is Forming In US Oil (MW)

Oil is already in a bear market, but now a fresh, negative pattern is crystallizing in the commodity that has absolutely bludgeoned bulls over the past two months. January West Texas Intermediate crude on its first full session as the front-month contract, was down a whopping 7.5%, to $52.91 a barrel on the New York Mercantile Exchange and that downtrend has propelled the U.S. benchmark to the brink of forming a death cross—a chart formation in an asset that many market technicians believe marks the point that a short-term decline morphs into a longer-term downtrend (see chart below).

Based on the continuous chart for the most-active oil contract, the 50-day moving average at $67.58 a barrel is less than 0.5% shy of falling beneath the long-term 200-day moving average at $67.25, according to FactSet data. At the current rate of decline, a death cross could occur within a week or two. Both the U.S. contract and the global benchmark Brent oil are in bear market, usually characterized as a decline of at least 20% from a recent peak. In fact, U.S. oil is down 31% from its Oct. 3 peak at $76.41 a barrel.

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Miners are ditching their equipment.

Bitcoin Plunges As Much As 16% To Below $4,100, A New Low For The Year (CNBC)

Bitcoin is still struggling to find a bottom this week. The digital currency dropped as much as 16 percent on Tuesday to its lowest level since Sept. 30, 2017, according to data from CoinMarketCap.com. Bitcoin fell as low as $4,076.59, bringing its total losses in seven days to roughly 30 percent. The cryptocurrency briefly pared those losses and was down about 7 percent in afternoon trading. As U.S. stock markets closed though, bitcoin was still down 12 percent over 24 hours, trading near $4,299, according to data from CoinDesk.

The price plunge came after weeks of rare stability for the world’s largest and best-known cryptocurrency. While global markets churned in October, bitcoin traded comfortably in the $6,400 range — a break from volatility earlier this year. Its total losses this year are now more than 65 percent. ts epic rise last year started right after Thanksgiving as it began to gain status as a household name. Since then, the cryptocurrency has fallen more than 40 percent. Bitcoin first topped $10,000 at the end of November and made it to nearly $20,000 a week before Christmas as retail investors poured in and two regulated exchanges prepared to launch futures markets.

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“With share repurchases in these companies being almost three times their actual investment, one must wonder how much actual U.S. economic growth they are expecting.”

Misguided Share Buybacks Are Hollowing Out Companies’ Balance Sheets (MW)

GE was one of Wall Street’s major share buyback operators between 2015 and 2017; it repurchased $40 billion of shares at prices between $20 and $32. The share price is now $8.60, so the company has liquidated between $23 billion and $29 billion of its shareholders’ money on this utterly futile activity alone. Since the highest net income recorded by the company during those years was $8.8 billion in 2016, with 2015 and 2017 recording a loss, it has managed to lose more on its share repurchases during those three years than it made in operations, by a substantial margin. Even more important, GE has now left itself with minus $48 billion in tangible net worth at Sept. 30, with actual genuine tangible debt of close to $100 billion.

As the new CEO Larry Culp told CNBC last Monday: “We have no higher priority right now than bringing those leverage levels down.” The following day, GE announced the sale of 15% of its oil services arm Baker Hughes, for a round $4 billion. Of course, since that sale values Baker Hughes at $26 billion, and GE paid $32 billion for 62% of Baker Hughes as recently as last year, which looks to me like a valuation for the whole company of $52 billion, GE shareholders appears to have lost half the value of their investment in Baker Hughes in about 18 months. [..] A recent Financial Times article outlined how the five tech companies with the most cash (Apple, Alphabet, Cisco, Microsoft and Oracle) have repurchased an astounding $115 billion of stock in the first three quarters of 2018.

By contrast, the total capital spending of the five companies was only $42.6 billion during the same period. The story then congratulated investors for having done so well out of President Trump’s tax reform, which lowered the corporate tax rate, thus encouraging investment in the United States. With share repurchases in these companies being almost three times their actual investment, one must wonder how much actual U.S. economic growth they are expecting. [..] These share repurchases are misguided in so many ways. First, Apple, Alphabet and Microsoft are valued by the stock market at close to $1 trillion, levels no company has ever reached before. If you ignore the current stock price, a company repurchasing its shares is simply giving away its cash and reducing its share count; it creates no value.

Read more …

Dangerously close to a political statement.

Bank of England Backs Theresa May’s Brexit Deal, Warns Of No-Deal Dangers (G.)

Mark Carney has thrown his weight behind Theresa May’s Brexit deal, warning that a no-deal scenario would damage the economy, trigger job losses, lead to lower pay for workers and cause inflation to rise. The governor of the Bank of England said May’s draft EU withdrawal agreement would “support economic outcomes” that would be positive for the British economy, primarily because it would give Britain more time to prepare for whatever final Brexit deal is agreed between Westminster and Brussels. “We welcome the transition arrangements in the withdrawal agreement. It’s at the heart [of the deal],” he told MPs on the Treasury select committee, a week after the prime minister agreed the terms of the deal with the EU.

“[The deal] improves our ability to discharge our function relative to having no deal,” he added. The timing of the governor’s comments could help to support May as she faces tough opposition from across the political divide, following cabinet resignations and Labour’s promise to vote it down in parliament. Carney warned that failure to agree a Brexit deal with Brussels before the March 2019 deadline would deliver a “large negative shock” to the UK economy that would have a persistent effect, lowering growth and causing job losses. He said such an outcome would deliver an “unprecedented supply shock” to the UK economy with few historical or international comparisons. “It wouldn’t be a happy situation to be in,” he said.

Read more …

These talks should have started two years ago. And even then.

May’s Brussels Trip Only Start Of ‘Endless’ EU Trade Talks (G.)

When Theresa May goes to Brussels for tea with Jean Claude Juncker on Wednesday afternoon, the two leaders will have in front of them a metaphorical Christmas tree of a political declaration. “And every member state has put a bauble on it”, an EU diplomat said. A seven-page document published last week, offering some heads of terms on the future relationship, is set to more than double to some 20 pages. Calls for more ambitious language around the trade elements have been made. Demands for a Spanish veto over any deal covering Gibraltar have been tabled. And an array of asks on so called “level playing field” commitments in any future trade deal are in the mix.

There is even talk of side-declarations to the political declaration emerging at the special Brexit summit next Sunday to allow member states to feel that they have drawn a line in the sand about the real trade talks to come. “It’s all getting very confusing,” admitted a second EU diplomat. Not to Sir Andrew Cahn, the former chief executive of the government’s UK Trade & Investment (UKTI) department, who was also an aide to Neil Kinnock when vice president of the European commission in the late 1990s. This is, he said, likely to be a mere amuse-bouche to the “continuous endless” talks that will open on the UK’s trading relationship with Brussels after 29 March 2019 as the UK finds its way around the EU’s orbit.

“It is a classic EU negotiation and the member states are performing their normal way,” Cahn said. “The French always come in late to toughen their negotiating position towards the end, and that’s when they can get some additional things. “The Spanish are copying with Gibraltar – although that is partly a function of domestic Spanish politics with Pedro Sánchez [the Spanish prime minister] being vulnerable at home.”

Read more …

What, she didn’t tell you?

UK To Be ‘Frozen Out’ Of 182 EU Decisions During Brexit Transition (Ind.)

The UK will be “frozen out” of EU decisions on no fewer than 182 new rules in the months after Brexit, a new analysis says, including over budget spending, road signs and drinking water. The full scale of fresh regulations in the pipeline – during Theresa May’s planned 21-month transition period – exposes the blunder of making Britain “a rule-taker, not a rule-maker”, it warns. During that transition, the UK will be bound by Brussels’ decisions but without any ministers in the EU council, or MEPs in the European parliament, to influence them. Now the campaign for a People’s Vote on the Brexit outcome has examined the decisions expected before 2020, which also include alcohol-taxing and rules for UK investment funds.

“This analysis sets out for the first time the full scale of the UK’s capitulation under this so-called deal,” said Chris Bryant, a Labour supporter of People’s Vote. “The prime minister’s deal would weaken our ability to have a say in over 180 crucial decisions that are going to be made in Europe while the UK is in transition – meaning we have to abide by their rulings but have no say and no ability to protect Britain’s interests. “This dodgy deal will leave Britain frozen out of decision making and forced to pay billions of Euros for the privilege.” The argument goes to the heart of criticism – by both pro and anti-Brexit MPs – that the UK will be a “vassal state” during the transition phase.

Read more …

Russophobia continues unabated.

Interpol Elects South Korean As Its President In Blow To Russia (G.)

South Korea’s Kim Jong-yang has been elected as Interpol’s next president, edging out a longtime veteran of Russia’s security services who was strongly opposed by the US, Britain and other European nations. The White House and its European partners had lobbied against Alexander Prokopchuk’s attempts to be named the next president of the international police body, saying his election would lead to further Russian abuses of Interpol’s “red notice” system to go after political opponents. Prokopchuk is a general in the Russian interior ministry and serves as an Interpol vice-president. Kim was chosen by Interpol’s 94-member states at a meeting of its annual congress in Dubai.

He will serve until 2020, completing the four-year mandate of his predecessor, Meng Hongwei, who went missing in his native China in September. Beijing later said Meng resigned after being charged with accepting bribes. Critics say that Prokopchuk oversaw a policy of systematically targeting critics and dissidents during his time in charge of the Russian office of Interpol. On Tuesday, the US secretary of state, Mike Pompeo, threw his weight behind Kim, who is the acting president of the global police body. “We encourage all nations and organisations that are part of Interpol and that respect the rule of law to choose a leader with integrity. We believe Mr Kim will be just that,” Pompeo told reporters.

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If only we move to recycled plastic! Geez, Louise, how about no plastic at all? You can cut at least 50% without changing anything much at all. More recycling is a fake message.

Tax ‘Virgin Packaging’ To Tackle Plastics Crisis – Report (G.)

The government should introduce a new tax on virgin packaging to revolutionise the recycling system in the UK and tackle the plastics crisis, according to a new report. The study, presented to MPs and industry figures at Westminster on Tuesday evening, calls on ministers to impose a fee on packaging materials and offer a rebate for those products that use more recycled material. The WWF and the Resource Association, which commissioned environment consultancy Eunomia to produce the report, said the proposals would transform the UK’s broken recycling system – and drastically reduce the demand for raw materials, including fossil fuels. Dr Lyndsey Dodd, head of marine policy at WWF UK, said: “Our oceans are choking on plastic, 90% of the world’s sea birds have fragments of plastic in their stomach.

Despite the public outcry, more products are being made with virgin, or new, plastic than with recycled plastic.” Last year the Guardian revealed that plastic production is set to increase by 40% over the next 10 years as fossil fuel companies look to use raw materials produced by fracking in the US. The new report follows an announcement in October that the government is launching a consultation on the introduction of a tax on all plastic packaging with a recycled content of less than 30%. [..] Earlier this year the Guardian reported the plastics recycling industry was under investigation for suspected widespread abuse and fraud within the export system. Since China banned the import of plastic waste, the UK has been chasing other markets in Malaysia, Vietnam and Thailand, but these countries are also imposing restrictions due to the stockpiling of waste.

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“..115 plastic cups, four plastic bottles, 25 plastic bags, two flip-flops, a nylon sack and more than 1,000 other assorted pieces of plastic..”

Dead Whale Washes Ashore In Indonesia With 6 Kilos Of Plastic In Stomach (AP)

A dead whale that washed ashore in eastern Indonesia had a large lump of plastic waste in its stomach, including drinking cups and flip-flops – causing concern among environmentalists and government officials in one of the world’s largest plastic polluting countries. Rescuers from Wakatobi National Park found the 9.5-metre sperm whale late on Monday in waters near Kapota Island, southeast of Sulawesi, after receiving a report from environmentalists that villagers had surrounded the dead creature and were beginning to butcher its rotting carcass, park chief Heri Santoso said. Researchers from wildlife conservation group WWF and the park’s conservation academy found about 5.9 kilograms of plastic waste in the animal’s stomach – including 115 plastic cups, four plastic bottles, 25 plastic bags, two flip-flops, a nylon sack and more than 1,000 other assorted pieces of plastic.

“Although we have not been able to deduce the cause of death, the facts that we see are truly awful,” said Dwi Suprapti, a marine species conservation coordinator at WWF Indonesia. She said it was not possible to determine if the plastic had caused the whale’s death because of the animal’s advanced state of decay. Indonesia, an archipelago of 260 million people, is the world’s second-largest plastic polluter after China, according to a study published in the journal Science in January. It produces 3.2 million tonnes of mismanaged plastic waste a year, of which 1.29 million tonnes ends up in the ocean, the study said.

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Can we say the MSM wakes up with this USA Today piece?

Julian Assange Deserves A Medal of Freedom, Not A Secret Indictment (USA Today)

On the same day the Assange indictment scored headlines, Trump awarded seven Presidential Medals of Freedom. No controversy greeted posthumous awards to Babe Ruth and Elvis Presley — unlike the ruckus regarding Miriam Adelson, wife of Republican super-donor Sheldon Adelson. Public Citizen, a liberal nonprofit, howled that the Adelson award “is just the latest sign of [Trump’s] ability to corrupt and corrode all aspects of the government.” New York Times columnist Paul Krugman caterwauled that it was “ludicrous” and “and an insult to people who received the medal for genuine service.” In reality, Presidential Medals of Freedom have routinely been exploited to buttress the political establishment, with bevies of awards for political operators, members of Congress, and pliable foreign leaders.

President Lyndon Johnson distributed a bushel of Medals of Freedom to his Vietnam War architects and enablers, perhaps as consolation prizes for losing the war. (The medal awarded to Defense Secretary Robert McNamara, whose lies about the war making progress cost thousands of Americans and Vietnamese their lives, fetched $40,625 at an auction a few years ago.) President George W. Bush conferred Medals of Freedom on his Iraq war team, including CIA chief George “Slam Dunk” Tenet, Iraq viceroy Paul Bremer, and ambassador Ryan Crocker, whom Bush called “America’s Lawrence of Arabia.”

Some of the biggest fabulists of the modern era — including Henry Kissinger and Dick Cheney — also pocketed the award.The controversies over Assange and Adelson provide a serendipitous opportunity to update the freedom awards. Because few things are more perilous to democracy than permitting politicians to coverup crimes, there should be a new Medal of Freedom category commending individuals who have done the most to expose official lies. This particular award could be differentiated by including a little steam whistle atop the medal — vivifying how leaks can prevent a political system from overheating or exploding.

Assange would deserve such a medal — as would Thomas Drake and Edward Snowden (who revealed NSA’s abuses), John Kiriakou (who revealed CIA torture), and Daniel Ellsberg (who leaked the Pentagon Papers). Admittedly, there may be no way to stop presidents from giving steam whistle freedom awards to political donors’ wives. Organizations like Wikileaks are among the best hopes for rescuing democracy from Leviathan. Unless we presume politicians have a divine right to deceive the governed, America should honor individuals who expose federal crimes.

Read more …

Aug 092018
 


René Magritte The evening gown 1954

 

Julian Assange has received an letter from the US Senate asking him to testify in front of them. What to make of that is not entirely clear. Far as I know, Assange offered such testimony multiple times, under the ‘right standards’. The Senate ostensibly wants this to take place behind closed doors, and it’s hard to see how that would fit Assange’s standards. But who knows?

What struck me was that the letter was signed by Senators Richard Burr (R-NC) and Mark Warner (D-VA). and especially the latter runs like a red thread through everything that has to do with Assange and the US. It reminded me of what John Solomon said in his June 25 piece ‘How Comey Intervened To Kill Wikileaks’ Immunity Deal’ about Assange lawyer Adam Waldman, who according to Solomon has a ‘Forrest Gump-like penchant for showing up in major cases of intrigue’.

Mark Warner has that, too. What made me return to this is that in his piece yesterday on the Senate request, Tyler Durden, referring to Solomon’s article, wrote: After Assange’s request was run up the flag pole, Senator Warner was issued a “stand-down” order by Comey.. And I thought: I’m not sure that’s entirely correct, and not only because Comey cannot ‘order’ a US Senator to do anything.

The stand down order was not for Warner, he just passed it on to Waldman and his counterpart acting for the DOJ, David Laufman, head of Justice’s counterintelligence and export controls section. NOTE: we don’t even know if the stand down didn’t really come from Warner, or Comey AND Warner, or someone else altogether.

What we do know is that it was a very peculiar order at a very peculiar moment in time, because the intelligence community could have gotten something tangible and valuable out of the negotiations. Solomon: “..officials “understood any visibility into his thinking, any opportunity to negotiate any redactions, was in the national security interest and worth taking,” says a senior official involved at the time.

They were well on their way to -at least potentially- save the lives of CIA operatives and assets. Negotiations had been going on for at least 2 months, and probably more like three. But then Assange offered to provide evidence that he didn’t get the DNC files from Russia. And that seems to have changed the atmosphere. Tyler has some more about this, outside of the Solomon piece:

‘Last August, Congressman Dana Rohrabacher travelled to London with journalist Charles Johnson for a meeting with Assange, after which Rohrabacher said the WikiLeaks founder offered “firsthand” information proving that the Trump campaign did not collude with Russia, and which would refute the Russian hacking theory.’ After Trump denied knowledge of the potential deal, Rohrabacher raged at Trump’s Chief of Staff, John Kelly, for constructing a “wall” around President Trump by “people who do not want to expose this fraud.”

NOTE: that meeting took place 4-5 months AFTER the Comey (et al?) stand down order. So Assange was still reaching out and offering to spare individual CIA assets. He has released a lot of the CIA Vault 7 files, but not all. To my knowledge he has held back on that to this day.

 

I don’t know how much you still follow from the pro-Russiagate press, which is about the entire US MSM, but Rohrabacher is habitually called a traitor, a Putin puppet and worse for talking to Russians, just like he is for going to see Assange. Once you start trying to find a way out of the ever tighter woven Russia Russia web, you’re fair game. Even if that’s simply your job as a Congressman, or at least your interpretation of what the job entails.

Back to Solomon for a bit. What he describes is not some amnesty deal, but a “Queen for a Day” proffer. Which in this case was essentially a safe passage guarantee for Assange to leave the Ecuador embassy only to go talk to US government people. We don’t know all the prospective topics of the talks, and they don’t seem to have agreed on a location (London, Washington?!) before the Comey order. Solomon:

Not included in the written proffer was an additional offer from Assange: He was willing to discuss technical evidence ruling out certain parties in the controversial leak of Democratic Party emails to WikiLeaks during the 2016 election. The U.S. government believes those emails were hacked by Russia; Assange insists they did not come from Moscow.

“Mr. Assange offered to provide technical evidence and discussion regarding who did not engage in the DNC releases,” Waldman told me. “Finally, he offered his technical expertise to the U.S. government to help address what he perceived as clear flaws in security systems that led to the loss of the U.S. cyber weapons program.”

That is just funny: Assange offered to help the CIA on its security systems. That must have pissed them off mightily, because it can only mean they really needed to strengthen security (or he wouldn’t have brought it up). But then Waldman reaches out to Warner, in what may well have been a fatal mistake. The talks with the DOJ were going well, and might have been enough. Getting politics involved in it was one took over the line:

[..] Just a few days after the negotiations opened in mid-February, Waldman reached out to Sen. Warner; the lawyer wanted to see if Senate Intelligence Committee staff wanted any contact with Assange, to ask about Russia or other issues. Warner engaged with Waldman over encrypted text messages, then reached out to Comey. A few days later, Warner contacted Waldman with an unexpected plea.

“He told me he had just talked with Comey and that, while the government was appreciative of my efforts, my instructions were to stand down, to end the discussions with Assange,” Waldman told me. Waldman offered contemporaneous documents to show he memorialized Warner’s exact words.

Waldman couldn’t believe a U.S. senator and the FBI chief were sending a different signal, so he went back to Laufman, who assured him the negotiations were still on. “What Laufman said to me after he heard I was told to ‘stand down’ by Warner and Comey was, ‘That’s bullshit. You are not standing down and neither am I,’” Waldman recalled.

A source familiar with Warner’s interactions says the senator’s contact on the Assange matter was limited and was shared with Senate Intelligence chairman Sen. Richard Burr (R-N.C.). But the source acknowledges that Warner consulted Comey and passed along the “stand down” instructions to Waldman: “That did happen.”

Okay, so we have Warner very much in the thick of the DOJ negotiations with Assange. Fast forward to late June 2018, when his name pops up again in a list of 10 Democratic Senators who asked Vice President Mike Pence to, on a visit to Ecuador, ask new president Lenin Moreno, to revoke Assange’s asylum on the London embassy.

 

 

Warner is there, along with such fine human beings as Dianne Feinstein, and the two Dicks Durbin and Blumenthal. Wikileaks, which posted the list, suggested: “Remember them”. Looks like an idea. Why would the Democratic party want Assange delivered to the lions? Oh, right, Russia Russia, the entirely unproven allegations which they are so desperate to tie Assange into.

They can’t prove any of the many allegations of Russian meddling, let alone their role in Hillary’s election loss, and they can’t prove any allegation against Julian Assange, at least none that he could be charged for/with, but tie Russia and WikiLeaks together and they feel they no longer have to prove anything at all, that mere allegations are strong enough.

If there is no crime Assange can be accused of, you just label him a terrorist, and all your legal problems disappear. Because terrorism can be anything, and because of national security reasons, any evidence, whether it exists or not, must be treated in secret. What reason, what grounds, do these Senators have to ask Ecuador to revoke Assange’s asylum? What legal grounds could possibly exist? We have no way of knowing, and because they label Julian a terrorist, we have no right to, either. Or so they claim.

This is called abomination of justice. In the same way that America and Britain’s treatment of him is called torture. And no, that is not too strong a term. A man who has never been charged with a crime by anyone, in any country, is being tortured. Julian has severe, painful, dental problems, he has developed a condition that makes his legs swell, and his bone density is dropping fast due to extended lack of sunlight.

These people have simply decided to wait it out, so they don’t have to go through elaborate legal procedures that they may well lose, to wait until Assange has no choice but to walk out of the embassy, or be carried out on a stretcher or in a coffin. It’s not even possible to list all the British, American, Ecuadorian and international laws his treatment violates.

Someone should give it a try, though. Just like someone should investigate Mark Warner’s role in all of this. Warner was pivotal in killing off the Assange legal teams’ talks with the DOJ, he asked Ecuador to stop Assange’s asylum (which is so illegal you don’t even want to go there), and now he requests for Assange to appear before the US Senate.

Someone investigate that guy. If I can say one last thing, it would be that Warner exemplifies all that is wrong with the US Democratic Party. He’s the Forrest Gump of all their future election losses. The Democrats should be standing up to protect people like Assange, but instead they follow the example of Hillary, who said about Assange “can’t we drone this guy?”.

Yeah, the very guy who’s never been charged with a single crime. She undoubtedly said it in the same tone of voice as her insane cackle of “We came, we saw, he died” about Gaddafi. Looked at Libya lately?

The essence of this is that we will be better people, and better societies, with Julian Assange around to help us be better. Without him, things look a whole lot darker. We need to be able to hold politicians, corporations and secret services to account. And the more they resist this, often in illegal ways, the more we must insist.

The idea was never that we must answer to them. They must answer to us, and we must be able to throw them out when they cross legal and moral lines. It’s beyond the pale that that has to be explained once again. And trying to explain that, with examples, is all that Julian Assange has ever done.

 

 

Jun 232017
 
 June 23, 2017  Posted by at 9:55 am Finance Tagged with: , , , , , , , , ,  


Fred Lyon Embarcadero lunch San Francisco 1948

 

Americans Are Dying With An Average Of $61,500 In Debt (ZH)
34 Biggest Banks in US Clear First Hurdle In Fed’s Annual Stress Tests (R.)
Credit-Card Debt Slaves Move to Top of Fed’s Bank Worries (WS)
Citizens Will Soon Turn Their Rage Towards Central Bankers (Albert Edwards)
UK Homelessness Surges 34% Under Tories Since 2010 (Ind.)
UK High Court Judges Tory Policy Causes ‘Real Misery For No Purpose’ (Ind.) /span>
Buy-to-Let Uk Property Sales Fall By Almost 50% In A Year (G.)
Canada’s Private Sector Debt Growing Faster Than Any Advanced Economy (PA)
Warren Buffett Becomes Lender Of Last Resort For Canada’s Home Capital (BBG)
EU Political Class Rides Roughshod over Citizens’ Concerns & Frustrations (DQ)
Dear Oliver: About Those Putin Interviews (RM)
Arab States Send Qatar 13 Demands To End Crisis (R.)
In Yemen’s Secret Prisons, UAE Tortures and US Interrogates

 

 

Double or nothing?!

Americans Are Dying With An Average Of $61,500 In Debt (ZH)

According to a recent study, the average total household debt in America is just over $132,500, broken down as per the chart below… and thanks to the Fed’s recent and ongoing rate increases, the repayment of said debt will become increasingly more difficult. So difficult, in fact, that most Americans will be saddled with a sizable chunk of it at the time of their death. Actually, most already are. According to December 2016 data from credit bureau Experian provided to credit.com, 73% of American consumers had outstanding debt when they were reported as dead. Those consumers carried an average total balance of $61,554, including mortgage debt. Without home loans, the average balance was $12,875. As credit.com reports, the data is based on Experian’s FileOne database, which includes 220 million consumers.

To determine the average debt people have when they die, Experian looked at consumers who, as of October 2016, were not deceased, but then showed as deceased as of December 2016. Among the 73% of consumers who had debt when they died, about 68% had credit card balances. The next most common kind of debt was mortgage debt (37%), followed by auto loans (25%), personal loans (12%) and student loans (6%). The breakdown of unpaid balances was as follows: credit cards, $4,531; auto loans, $17,111; personal loans, $14,793; and student loans, $25,391. And, as a reminder, debt doesn’t just disappear when someone dies.

What happens to that debt when you die, aside from it continuing to accrue interest until someone remembers to inform the creditors? “Debt belongs to the deceased person or that person’s estate,” said Darra L. Rayndon, an estate planning attorney with Clark Hill in Scottsdale, Arizona. If someone has enough assets to cover their debts, the creditors get paid, and beneficiaries receive whatever remains. But if there aren’t enough assets to satisfy debts, creditors lose out (they may get some, but not all, of what they’re owed). Family members do not then become responsible for the debt, as some people worry they might. That’s the general idea, but things are not always that straightforward. The type of debt you have, where you live and the value of your estate significantly affects the complexity of the situation. For example, federal student loan debt is eligible for cancellation upon a borrower’s death, but private student loan companies tend not to offer the same benefit. They can go after the borrower’s estate for payment.

Read more …

Let’s do a stress test that assumes the Fed is no longer around, see what happens.

34 Biggest Banks in US Clear First Hurdle In Fed’s Annual Stress Tests (R.)

The 34 largest U.S. banks have all cleared the first stage of an annual stress test, showing they would be able to maintain enough capital in an extreme recession to meet regulatory requirements, the Federal Reserve said on Thursday. Although the banks, including household names like JPMorgan Chase and Bank of America, would suffer $383 billion in loan losses in the Fed’s most severe scenario, their level of high-quality capital would be substantially higher than the threshold that regulators demand, and an improvement over last year’s level. “This year’s results show that, even during a severe recession, our large banks would remain well capitalized,” said Fed Governor Jerome Powell, who leads banking regulation for the central bank. “This would allow them to lend throughout the economic cycle, and support households and businesses when times are tough.”

The Fed introduced the stress tests in the wake of the financial crisis to ensure the health of the banking industry, whose ability to lend is considered crucial to the health of the economy. Since the first test was conducted in 2009, big banks have seen losses abate, loan portfolios improve and profits grow. The banks that now undergo the exam have also strengthened their balance sheets by adding more than $750 billion in top-notch capital, the Fed said. Banks and their investors have been hoping the improvements would prompt the Fed to allow them to use more capital for stock buybacks and dividends, especially as the Trump administration is seeking to relax financial regulations. Wall Street analysts and trade groups quickly cheered the results on Thursday, saying regulators should feel comfortable easing tough rules put in place since the financial crisis. “We see today’s…stress test results as a positive for Trump administration efforts to deregulate the banks,” said Jaret Seiberg, a policy analyst with Cowen & Co.

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The biggest debts are still in mortgages. Falling home prices will hurt most.

Credit-Card Debt Slaves Move to Top of Fed’s Bank Worries (WS)

The comforting news in the results from the Federal Reserve’s annual stress test is that the largest 34 bank holding companies would all survive a recession. Based on this glorious accomplishment, the clamoring has already started for regulators to allow these banks to pay bigger dividends and to blow more money on share buybacks, and for these regulators to slash regulation on these banks and make their life easier and riskier in general. We don’t want these banks to survive a recession in too good a condition apparently. And it would likely be better for Wall Street anyway if banks could lever up with risks so that a few of them would get bailed out during the next recession. Let’s remember, for the Fed’s no-holds-barred bailout-year 2009, Wall Street executives and employees were doused with record bonuses.

The Fed’s bailouts were good for them. And it has been good for them ever since. The less comforting news in the stress test is that credit card debt – generally the most expensive and risky debt for consumers – has now moved to the top of the Fed’s worry list in the “severely adverse scenario” of the stress test. The projected losses for the 34 largest banks – not counting the losses at the 4,997 smaller banks – are expected to hit $100 billion, up nearly 9% from the stress test a year ago. The projected losses rose for several reasons, including that credit card balances have grown by 5.6% from a year ago to over $1 trillion. The delinquency rate has risen to 2.4%. The Fed is also blaming looser lending standards. Sharing the top spot on the Fed’s worry list in the “severely adverse scenario” are Commercial & Industrial loans, whose balances are over twice as large, at $2.1 trillion, but whose projected losses are also pegged at $100 billion. In total, the “severely adverse scenario” sees $493 billion in losses for these 34 banks:

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“..investors, drunk with the liquor of loose money..”

Citizens Will Soon Turn Their Rage Towards Central Bankers (Albert Edwards)

Albert Edwards pwrites “Theft redux: the citizens will soon turn their rage towards Central Bankers.” The core of his argument is familiar: “While politics in the West reels from a decade of economic crisis and stagnation, asset prices continue to surge on the back of continued rapid growth in G3 QE. In an age of “radical uncertainty” how long will it be before angry citizens tire of blaming an impotent political system for their ills and turn on the main culprits for their poverty – unelected and virtually unaccountable central bankers? I expect central bank independence will be (and should be) the next casualty of the current political turmoil.” That’s just the beginning from Edwards, who appears to be getting increasingly angrier and more frustrated with a market that makes increasingly less sense: his fiery sermon continue with the following preview of the “inevitable catastrophe that lies ahead.”

“Evidence of the impact of monetary madness on assets prices is all around if we care to look. I read that a parking spot in Hong Kong was just sold for record HK$5.18 million ($664,200). What about the 3.5x oversubscribed 100 year Argentine government bond? Sure, everything has a market clearing price, even one of the most regular defaulters in history. But what concerned me most about the story was it was demand from investors (“reverse enquires”) that prompted the issue. Is it just me or can I hear echoes of the mechanics of the CDO crisis? But no one cares when the party is still raging and investors, drunk with the liquor of loose money, are blind to the inevitable catastrophe that lies ahead. There is a lot of anger out on the streets, as demonstrated most visibly in recent elections.

Even in France where investors feel comforted that a “moderate” has gained (absolute?) power, it is salutary to remember that the two establishment parties have just been decimated by a man who had never before stood for public office! This is perhaps even more radical than Trump’s anti-establishment victory under the Republican umbrella. The global political situation is incredibly fluid and unpredictable. While a furious electorate has turned its pent up anger on the establishment political parties, the target for their rage is misguided. I am not completely alone in thinking it is the unelected and virtually unaccountable central bankers who are primarily responsible for the poverty of working people and who will be ultimately held to account in the next crisis.

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In other news: ” Government-funded new social housing has fallen 97% since 2010″.

UK Homelessness Surges 34% Under Tories Since 2010 (Ind.)

The number of families being declared homeless has rocketed by more a third since the Conservatives took power in 2010, analysis of new official statistics by The Independent has revealed. Between April 2016 and March 2017, 59,100 families were declared homeless by local authorities in England – a rise of 34% on the same period in 2010-11. The statistics paint a bleak picture of the UK housing crisis and the impact a lack of decent, affordable homes is having on thousands of families. There has been a 60% increase in the number of families being housed in insecure temporary accommodation. In particular, bed and breakfast-type hotels are increasingly being used to house families for long periods of time as local councils struggle to find them proper homes to live in.

There are now 77,240 families in England currently living in temporary accommodation – up from 48,240 just six years ago. Of these, almost fourth-fifths (78%) are families with children, meaning there are currently 120,500 children living in insecure, temporary homes. Of those being housed temporarily, 6,590 households are living in B&Bs, including 3,010 families with children. Almost half have been living in this type of accommodation, which often sees families crammed into one room and forced to share limited bathroom and cooking facilities with strangers, for more than six weeks. This is illegal under the Homelessness (Suitability of Accommodation) Order 2003, which banned local authorities from housing families with children in B&Bs for more than a six-week period.

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The Tories are done. Someone should tell them.

UK High Court Judges Tory Policy Causes ‘Real Misery For No Purpose’ (Ind.)

Today, the High Court ruled that the benefits cap, one of the Tories’ flagship welfare policies, is unlawful, because it amounts to illegal discrimination against single parents with small children. It’s likely that the Government will be forced to alter or completely scrap their benefits cap, a policy that limits the total amount a household can receive in benefits to £23,000 in London and £20,000 elsewhere in the UK. High Court judge Justice Collins described the benefit cap as causing “real damage” to single parent families and said “real misery is being caused to no good purpose”. This is the fundamental truth at the heart of Tory welfare policy – misery without progress or reason.

Welfare reform as part of the coalition government’s austerity measures has driven thousands more people into poverty and in many tragic cases, some deaths occurred after individuals were declared fit to work. Austerity was not inevitable. It was an ideologically-motivated programme designed to force the poorest and most vulnerable in our society to shoulder the burden of a financial crisis that they had less than nothing to do with creating. Four claimants brought this case to court. Two of them had been made homeless as a result of domestic violence, and were trying to work as many hours as possible while taking care of children under the age of two. Imagine fleeing an abusive partner, seeking support from a domestic violence service that’s had its funding brutally slashed by the Tory government, trying to work and look after a small child, then having your benefits cut, again by the Tory government.

The claimants are not alone. The benefits cap has inflicted a massive amount of suffering, with 200,000 children from the very lowest income families affected, as their parents’ income has fallen drastically. In real terms, this means that these children’s lives have become even more difficult, and they weren’t easy to begin with. This means a colder house, less food to eat, more shame at school due to unwashed clothes, uniforms that are too small, worn-through shoes. It means stressed, unhappy and increasingly desperate parents, and in family, children can’t fail to pick up on this mood of misery. [..] In this wealthy, highly developed country, poverty is the single biggest threat to the wellbeing of children and families. Poverty affects a quarter of all children in Britain, a massive, disgraceful, inexcusable proportion. one in five parents are struggling to feed their children, and 50% of all parents living in food poverty have gone without meals in order to give their children more to eat.

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There goes the bubble. Look out below.

Buy-to-Let Uk Property Sales Fall By Almost 50% In A Year (G.)

The number of properties bought by landlords has almost halved in a year after a tax and regulatory clampdown, prompting a leading banking body to downgrade its forecasts for buy-to-let lending in 2017 and 2018. The Council of Mortgage Lenders said buy to let had had a weak start to 2017, with lending falling faster than expected as landlords withdrew from the market in response to major tax changes and tighter lending rules. The data follows a series of recent surveys and indices suggesting the housing market is running out of steam. However, the crackdown on buy to let may have helped young people trying to get a foot on the property ladder. CML said house purchase activity was being driven predominantly by first-time buyers, with their numbers up 8% in the 12 months to April.

Buy-to-let homebuying activity was “nearly half what it was a year ago” and had averaged around 6,000 purchases a month over the last 12 months, said the body, which represents banks and building societies. The number of landlord purchases involving a mortgage was 5,300 in April this year. This compared with 10,300 in February 2016 and 11,800 in July 2015. As a result, the CML has cut its forecast for buy-to-let lending from £38bn being lent in both 2017 and 2018 to £35bn in 2017 and £33bn in 2018. The organisation warned against hitting landlords with any further changes to taxation and lending rules, saying the figures “re-emphasise the case for avoiding further changes to the tax and regulatory framework until the effect of these already in train have been properly assessed”.

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Download report here: Addicted to Debt – Tracking Canada’s rapid accumulation of private sector debt .

Canada’s Private Sector Debt Growing Faster Than Any Advanced Economy (PA)

For the first time ever, Canada’s private sector is racking up debt faster than any other of the world’s 22 advanced economies, putting the country at risk of serious economic consequences, according to new research by the Canadian Centre for Policy Alternatives. A new report authored by CCPA Senior Economist David Macdonald reveals that Canada added $1 trillion in private sector debt over the past five years ($2016), with the corporate sector responsible for the majority of it. Economies can become dependent on debt in order to fuel economic and asset price growth. With both rapid private debt accumulation and a high private debt-to-GDP ratio, even a small change in debt growth rates, brought on by changes in interest rates for instance, could have a devastating impact on the larger economy.

“Private sector debt growth is one of the best predictors of economic crisis, and Canada is now the only advanced economy squarely in the debt ‘danger zone’ of having high private sector debt that continues to rise rapidly,” Macdonald says. The report identifies several areas of concern:
• Canada has never before led the advanced economies in private debt growth;
• The last time Canada was close to leading the world in private debt growth was the early 1990s, just as housing prices plummeted and then stagnated for a decade;
• The country’s private debt-to-GDP ratio has risen by a fifth since 2011, from 182% to 218%. The US ratio currently stands at 152%;
• The $315 billion increase in household debt since 2011 ($2016) is almost entirely attributable to the rise in mortgage debt related to rapid home prices increases;
• Corporate debt is less well studied, and rose $671 billion since 2011 ($2016), accounting for two thirds of private debt accumulation over that time;
• Corporate debt was largely spent on mergers and acquisitions as well as real estate purchases, neither of which make the country more productive.

“Canada’s economy has become addicted to binging on ever more private sector debt, and weaning us off it should be our primary public policy concern,” adds Macdonald, who recommends further study of corporate debt and consideration of a housing speculators’ tax to further reign in mortgage debt increases.

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Well, it can’t be because Buffett see a bright future in Canada’s housing market. So draw your own conclusion.

Warren Buffett Becomes Lender Of Last Resort For Canada’s Home Capital (BBG)

Warren Buffett has become the lender of last resort for Home Capital. The billionaire investor agreed to buy shares at a deep discount and provide a fresh credit line for the Canadian mortgage company, tapping a formula he used to prop up lenders from Goldman Sachs to Bank of America. Buffett’s Berkshire Hathaway Inc. will buy a 38% stake for about C$400 million ($300 million) and provide a C$2 billion credit line with an interest rate of 9% to backstop the embattled Toronto-based lender, Home Capital said late Wednesday in a statement. The interest on the one-year loan would net Berkshire at least C$180 million if it’s fully tapped.

“While the terms of the new credit line with Berkshire Hathaway remain harsh, we believe the purpose of this loan is to motivate Home Capital’s management to bolster their own funding sources,” said Hugo Chan at Kingsferry Capital in Shanghai, which owns shares in Home Capital. “This again shows Mr. Buffett’s masterful capital allocation skills,” said Chan, citing his investment motto: “be greedy when others are fearful.” The financial backing from Buffett sent the stock higher Thursday, though it comes at a cost, in keeping with his past bailouts of financial firms. Buffett has buoyed some of the biggest U.S. corporations in times of trouble, including a combined $8 billion injection to prop up Goldman Sachs and General Electric when credit markets froze during the 2008 financial crisis.

In the Home Capital deal, Buffett’s firm agreed to pay an average price of C$10 a share, a 33% discount to Wednesday’s closing price of C$14.94. Berkshire would become the largest shareholder in Home Capital, which has a market value of about C$1 billion. Home Capital surged 27% to C$19 in Toronto on Thursday. That gives Buffett a 90% return on paper for the equity investment, assuming the deal goes through.

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They always have, it’s an MO.

EU Political Class Rides Roughshod over Citizens’ Concerns & Frustrations (DQ)

Merkel has expressed a willingness to go along with two central French demands — the appointment of a Eurozone finance minister and the creation of a common budget — as long as certain conditions are met. “We can of course think about a Eurozone budget as long as it’s clear that this is really strengthening structures and achieving sensible results,” she said. [..] Back on the table is a proposal to upgrade the grossly unaccountable Luxembourg-based European Stability Mechanism (ESM) into a full-fledged European Monetary Fund. As we’ve noted before, creating a European Monetary Fund (EMF) would be an important statement of intent. If Europe’s core countries are truly set on taking the EU project to a whole new level, such as by pursuing the creation of an EU army, an EU border force (with full powers), fiscal union, and ultimately political union, some form of burden sharing will ultimately be necessary.

The establishment of a fully operational EMF could be an important move in that direction. The EMF would essentially act as a fiscal backdrop to the banking system, something the Eurozone has desperately needed ever since its creation. As Bruegel proposes, it would serve as a fiscal counterpart of the ECB to guarantee the financial stability of the euro area in the event of a sovereign or banking crisis, or a threat thereof — of which there are plenty these days, in particular emanating from Italy’s broken banking system. Naturally, the creation of an EMF would deal a further blow to the fading remnants of national sovereignty in Europe. But that’s a price that many (but certainly not all) of Europe’s elite is more than happy to pay; some would say that destroying national sovereignty was the ultimate goal of the EU all along.

In a survey of more than 10,000 EU citizens and 1,800 EU elites carried out by Chatham House, of the elites, 37% believe the EU should get more powers, 28% want to keep the status quo and 31% would prefer to return more powers to individual member countries. This enthusiasm for a more centralized, more powerful EU is not shared with equal enthusiasm by European citizens: 48% want powers returned to the individual member countries. Citizens, overall, do not feel they have benefited from European integration in the same way Europe’s elite does. Whereas 71% of elites report feeling they have gained something from the EU, the figure among the public is only 34%. Even more worrisome for national leaders, a clear majority of the public — 54% — feel that their country was a better place to live 20 years ago, before the euro existed.

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I’ve seen a few parts. Liked them quite a bit.

Dear Oliver: About Those Putin Interviews (RM)

Dear Mr. Stone: I have just finished watching all four episodes of The Putin Interviews. May I give you my critique? Overall, I felt that the series is Very Good but felt just short of Great. I will explain below what I feel could have made it Great. First, I want to tell you what I really loved about it. 1. You have an easy style. I felt as if Mr. Putin was at ease with you, and you with him. You have a warm command of the English language and can transmit your ideas into language in a very personable way — an art that is missing among so many American media people these days. I felt that you drew out a candid side of Putin, well, that is, as far as a man of his intellectual prowess and disciplined self-control will allow. 2. Best moment of the show: Sitting next to Vlad and watching Dr. Strangelove! Oh my goodness, most people would not even dream of adding such a thing to their bucket list.

3. I loved the walking tour of the President’s offices and the general background of the Kremlin architecture and decor. I pay attention to the daily, tweeted photos from the Kremlin’s official account. I have seen those desks and tables a million times in the photos. But now I have them all within a mental frame, thanks to your film. Question: I was burning to know why Vlad had a pair of scissors and multi-colored construction paper in the middle of his desk, did you happen to ask him, off-camera?

Where It Fell Short Mr. Stone, I hated that so much time was wasted talking about the contrived “Russia hacked the election” meme. Hillary might not know why she lost the election, but the rest of the nation does. When my father would get on a roll with his bad jokes, Mom would tell us kids: “Don’t encourage him.” Well, you too need to stop encouraging the MSM to keep breathing life into a dead meme.

You also wasted time re-hashing Crimea. “Read My Lips,” Vlad said, “the Crimeans ASKED, BEGGED, AND VOTED to rejoin Russia.” Good grief, when McCain’s and Nuland’s beloved neo-Nazi Svoboda party took illegal control of Ukraine, their first move was to try and make it illegal to speak Russian. Geez, half the people in Ukraine ARE Russian! Mr. Putin has exercised considerable restraint towards Ukraine.

Mr. Stone, I have been following the development of BRICS, the “Silk Road Project,” and the EEU (European Economic Union) for a half-decade now. I can’t have a conversation with my neighbors and friends about all of that here in America because not one of them has heard anything about it! You had a great opportunity to ask Mr. Putin to school us on the Sino-Russian version of a multi-polar world without war, but you totally blew it. I don’t think you ever asked Vlad about China, did you?

 

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Saudi Arabia accuses Qatar of supporting terrorism. Rich.

Arab States Send Qatar 13 Demands To End Crisis (R.)

Four Arab states boycotting Qatar over alleged support for terrorism have sent Doha a list of 13 demands including closing Al Jazeera television and reducing ties to their regional adversary Iran, an official of one of the four countries said. The demands aimed at ending the worst Gulf Arab crisis in years appear designed to quash a two decade-old foreign policy in which Qatar has punched well above its weight, striding the stage as a peace broker, often in conflicts in Muslim lands. Doha’s independent-minded approach, including a dovish line on Iran and support for Islamist groups, in particular the Muslim Brotherhood, has incensed some of its neighbors who see political Islamism as a threat to their dynastic rule.

The list, compiled by Saudi Arabia, the United Arab Emirates (UAE), Egypt and Bahrain, which cut economic, diplomatic and travel ties to Doha on June 5, also demands the closing of a Turkish military base in Qatar, the official told Reuters. Qatar must also announce it is severing ties with terrorist, ideological and sectarian organizations including the Muslim Brotherhood, Islamic State, al Qaeda, Hezbollah, and Jabhat Fateh al Sham, formerly al Qaeda’s branch in Syria, he said, and surrender all designated terrorists on its territory, The four Arab countries accuse Qatar of funding terrorism, fomenting regional instability and cozying up to revolutionary theocracy Iran. Qatar has denied the accusations.

[..] on Monday, Foreign Minister Sheikh Mohammed bin Abdulrahman al-Thani said Qatar would not negotiate with the four states unless they lifted their measures against Doha. The countries give Doha 10 days to comply, failing which the list becomes “void”, the official said without elaborating, suggesting the offer to end the dispute in return for the 13 steps would no longer be on the table.

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Bunch of sicko’s.

Edward Snowden on Twitter: “Biggest @AP scoop in a long time: US government behind UAE torture in Yemen, with some reportedly grilled alive.

In Yemen’s Secret Prisons, UAE Tortures and US Interrogates

Hundreds of men swept up in the hunt for al-Qaida militants have disappeared into a secret network of prisons in southern Yemen where abuse is routine and torture extreme — including the “grill,” in which the victim is tied to a spit like a roast and spun in a circle of fire, an Associated Press investigation has found. Senior American defense officials acknowledged Wednesday that U.S. forces have been involved in interrogations of detainees in Yemen but denied any participation in or knowledge of human rights abuses. Interrogating detainees who have been abused could violate international law, which prohibits complicity in torture. The AP documented at least 18 clandestine lockups across southern Yemen run by the United Arab Emirates or by Yemeni forces created and trained by the Gulf nation, drawing on accounts from former detainees, families of prisoners, civil rights lawyers and Yemeni military officials.

All are either hidden or off limits to Yemen’s government, which has been getting Emirati help in its civil war with rebels over the last two years. The secret prisons are inside military bases, ports, an airport, private villas and even a nightclub. Some detainees have been flown to an Emirati base across the Red Sea in Eritrea, according to Yemen Interior Minister Hussein Arab and others. Several U.S. defense officials, speaking on condition of anonymity to discuss the topic, told AP that American forces do participate in interrogations of detainees at locations in Yemen, provide questions for others to ask, and receive transcripts of interrogations from Emirati allies. They said U.S. senior military leaders were aware of allegations of torture at the prisons in Yemen, looked into them, but were satisfied that there had not been any abuse when U.S. forces were present.

“We always adhere to the highest standards of personal and professional conduct,” said chief Defense Department spokeswoman Dana White when presented with AP’s findings. “We would not turn a blind eye, because we are obligated to report any violations of human rights.” In a statement to the AP, the UAE’s government denied the allegations. “There are no secret detention centers and no torture of prisoners is done during interrogations.” Inside war-torn Yemen, however, lawyers and families say nearly 2,000 men have disappeared into the clandestine prisons, a number so high that it has triggered near-weekly protests among families seeking information about missing sons, brothers and fathers.

None of the dozens of people interviewed by AP contended that American interrogators were involved in the actual abuses. Nevertheless, obtaining intelligence that may have been extracted by torture inflicted by another party would violate the International Convention Against Torture and could qualify as war crimes, said Ryan Goodman, a law professor at New York University who served as special counsel to the Defense Department until last year

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May 272017
 
 May 27, 2017  Posted by at 5:41 pm Finance Tagged with: , , , , , , , , , , ,  


Herbert Draper Lament for Icarus 1898

 

There are times when you have to talk about things when it appears most inopportune to do so, because they’re the only times people might listen. Times when people will argue that ‘this is not the right moment’, while in reality it’s the only moment.

A solid 99% of people will have been filled, and rightly so of course, with a mixture of disgust, disbelief and infinite sadness when hearing of yet another attack on civilians in Europe, this one in Manchester. An equally solid 99% will have failed to recognize that while the event was unique for the city of Manchester, it was by no means unique for the world, not even at the time it happened.

Though the footage of parents desperately trying to find their children, and the news that one of the dead was just 8 years old, touches everyone in more or less the same place in our hearts, by far most of us miss out on the next logical step. In a wider perspective, it is easy to see that parents crying for missing children, and children killed in infancy, is what connects Manchester, and the UK, and Europe, to parents in Syria, Libya, Iraq.

What’s different between these places is not the suffering or the outrage, the mourning or the despair, what’s different is only the location on the map. That and the frequency with which terror is unleashed upon a given population. But just because it happens all the time in other places doesn’t make it more normal or acceptable.

It’s the exact same thing, the exact same experience, and still a vast majority of people don’t, choose not to, feel it as such. Which is curious when you think about it. In the aftermath of a terror attack, the mother of a missing, maimed or murdered child undergoes the same heartbreak no matter where they are in the world (“I hope the Russians love their children too”). But the empathy, the compassion, is hardly acknowledged in Britain at all, let alone shared.

Not that it couldn’t be. Imagine that our papers and TV channels would tell us, preferably repeatedly, in their reports in the wake of an attack like the one in Manchester how eerily similar the emotions must be to those felt in Aleppo, Homs and many other cities. That would change our perception enormously. But the media choose not to make the connection, and the people apparently are not capable of doing it themselves.

None of that changes the fact, however, that British lives are not more valuable than Syrian and Libyan ones. Not even when we’ve gotten used to ‘news’ about bombings and drone attacks executed for years now by US-led coalitions, or the images of children drowning when they flee the area because of these attacks.

The overall theme here is that 99.9% of people everywhere in the world are innocent, especially when they are children, but their governments and their societies are not. That doesn’t justify the Manchester attack in any shape or form, it simply lays equal blame and condemnation for western terror attacks in the Middle East and North Africa, perpetrated by the people we elect into power.

This is something people in the west pay no attention to. It’s easier that way, and besides our media with great enthusiasm pave the way for our collective ignorance, by calling some other group of people ‘terrorists’, which while they’re at it is supposed to justify killing some other mother’s child.

There’s another thing that is also different: they didn’t start. We did. The British and French terrorized the region for many decades, since the 19th century, even way before the Americans joined in. The presence of oil, and its rising role in our economies, caused them to double down on that terror.

Yes, it’s awkward to talk about this on the eve of a deadly attack, and it’s easy to find arguments and rhetoric that appear to deflect responsibility. But at the same time this truly is the only moment we can hope that anyone will listen. And lest we forget, the UK carries an outsized share of the responsibility in this tragedy, both historically and in the present.

You can say things about the city coming together, or the country coming together, or “not allowing terrorists to affect our way of life”, but perhaps it should instead really be all the mothers who have children missing or dying, wherever they live, coming together. They all see their ways of life affected, and many on a daily basis.

Those mothers in Syria and Libya, who have been through the same hellhole as those in Manchester, are a lot closer to you than the politicians who send out jet fighters to bomb cities in the desert, or sell arms to individuals and organizations to control these cities for their own narrow personal gain, such as the governments of Saudi Arabia and Turkey.

The traumatized mothers in the desert are not your enemies; your enemies are much closer to home. Still, most of you will tend to react to fear and panic by looking for protection in exactly those circles that are least likely to provide it. The UK government under Theresa May, like those of Tony Blair, Gordon Brown and David Cameron before, is as cynically eager as their predecessors to send bombers into the desert, and sell arms to those living there.

We can illustrate all this with a few bits of news. First, the US-led coalotion, of which the UK is a substantial part, killed more civilians in Syria than at any time since they started bombing the country almost 3 years ago. They keep saying they don’t target civilians, but to put it mildly they don’t appear to go out of their way not to hit them. For instance, a single attack on Mosul, Iraq in March killed over 105 civilians. ‘Collateral damage’ in these cases, and there are hundreds by now, is a very disrespectful term. Moreover, the files released by Chelsea Manning show US soldiers killing people ‘with impunity’.

Deadliest Month For Syria Civilians In US-Led Strikes

US-led air strikes on Syria killed a total of 225 civilians over the past month, a monitor said on Tuesday, the highest 30-day toll since the campaign began in 2014. The Syrian Observatory for Human Rights said the civilian dead between April 23 and May 23 included 44 children and 36 women. The US-led air campaign against the Islamic State jihadist group in Syria began on September 23, 2014. “The past month of operations is the highest civilian toll since the coalition began bombing Syria,” Observatory head Rami Abdel Rahman told AFP. “There has been a very big escalation.” The previous deadliest 30-day period was between February 23 and March 23 this year, when 220 civilians were killed, Abdel Rahman said.

And it’s not as if the British didn’t or couldn’t know what was going on. That was clear as early as 2003, when Tony Blair couldn’t wait to join the Bush coalition to invade Iraq on the false premise of weapons of mass destruction. Before Libya was invaded, which led to Hillary’s disgusting ‘we came we saw he died’, Gaddafi, the one who did die, warned Blair about what would happen. It indeed did, which makes Blair a guilty man.

Gaddafi Warned Blair His Ousting Would ‘Open Door’ To Jihadis

Muammar Gaddafi warned Tony Blair in two fraught phone conversations in 2011 that his removal from the Libyan leadership would open a space for al-Qaida to seize control of the country and even launch an invasion of Europe. The transcripts of the conversations have been published with Blair’s agreement by the UK foreign affairs select committee, which is conducting an inquiry into the western air campaign that led to the ousting and killing of Gaddafi in October 2011. In the two calls the former British prime minister pleaded with Gaddafi to stand aside or end the violence. The transcripts reveal the gulf in understanding between Gaddafi and the west over what was occurring in his country and the nature of the threat he was facing.

In the first call, at 11.15am on 25 February 2011, Gaddafi gave a warning in part borne out by future events: “They [jihadis] want to control the Mediterranean and then they will attack Europe.” In the second call, at 3.25pm the same day, the Libyan leader said: “We are not fighting them, they are attacking us. I want to tell you the truth. It is not a difficult situation at all. The story is simply this: an organisation has laid down sleeping cells in north Africa. Called the al-Qaida organisation in north Africa … The sleeping cells in Libya are similar to dormant cells in America before 9/11.”

Gaddafi added: “I will have to arm the people and get ready for a fight. Libyan people will die, damage will be on the Med, Europe and the whole world. These armed groups are using the situation [in Libya] as a justification – and we shall fight them.” Three weeks after the calls, a Nato-led coalition that included Britain began bombing raids that led to the overthrow of Gaddafi. He was finally deposed in August and murdered by opponents of his regime in October.

What they are guilty of is no more and no less than Manchester. No hyperbole, but a warning from Blair’s own intelligence services back in 2003. The real weapons of mass destruction were not in Iraq, but in the White House and Downing Street no. 10. The CIA issued warnings similar to this.

British Intelligence Warned Tony Blair Of Manchester-Like Terrorism If The West Invaded Iraq

Before the 2003 invasion of Iraq led by the U.S. and U.K., he was forcefully and repeatedly warned by Britain’s intelligence services that it would lead to exactly this type of terrorist attack — and he concealed these warnings from the British people, instead claiming the war would reduce the risk of terrorism. We know this because of the Chilcot Report, the seven-year-long British investigation of the Iraq War released in 2016. The report declassifies numerous internal government documents that illustrate the yawning chasm between what Blair was being told in private and his claims in public as he pushed for war.

On February 10, 2003, one month before the war began, the U.K.’s Joint Intelligence Committee — the key advisory body for the British Prime Minister on intelligence matters — issued a white paper titled “International Terrorism: War With Iraq.” It began: “The threat from Al Qaida will increase at the onset of any military action against Iraq. They will target Coalition forces and other Western interests in the Middle East. Attacks against Western interests elsewhere are also likely, especially in the US and UK, for maximum impact. The worldwide threat from other Islamist terrorist groups and individuals will increase significantly.”

And it concluded much the same way: “Al Qaida and associated groups will continue to represent by far the greatest terrorist threat to Western interests, and that threat will be heightened by military action against Iraq. The broader threat from Islamist terrorists will also increase in the event of war, reflecting intensified anti-US/anti-Western sentiment in the Muslim world, including among Muslim communities in the West.”

Not long behind Blair came David Cameron, a man after Tony’s heart:

Cameron Brags Of ‘Brilliant’ UK Arms Trade As EU Embargoes Saudi Arabia

European ministers have embarrassed David Cameron by voting to impose an arms embargo on Saudi Arabia on the same day the British prime minister praised the UK for selling “brilliant” arms to the country. Speaking at a BAE Systems factory in Preston, the prime minister said the UK had pushed the sale of Eurofighter Typhoons to countries in the Middle East, including Oman and Saudi Arabia. [..] Cameron’s speech in Preston came at the same time the European Parliament voted to impose an EU-wide ban on arms exports to Saudi Arabia, citing criticism from the UN of its bombing in Yemen.

Asked at the talks how he was helping to export the planes, Cameron said: “With the Typhoon there is an alliance of countries: the Italians, Germans and ourselves. We spend a lot of time trying to work out who is best placed to win these export orders. We’ve got hopefully good news coming from Kuwait. The Italians have been doing a lot of work there. The British have been working very hard in Oman.” The vote will not force EU members to comply with the ban, but will force the government to examine its relationship with Saudi Arabia.

In the last year the British government has sold £3 billion (US$4.18 billion) worth of arms and military kit to the Gulf state, as well as providing training to Saudi forces. A report released by Amnesty International on Friday called the ongoing trade with Saudi Arabia “truly sickening,” and urged governments to attend meetings in Geneva on Monday to discuss the implementation of the Arms Trade Treaty (ATT). The report names the UK, France, Germany, Italy, Montenegro, the Netherlands, Spain, Sweden, Switzerland, Turkey and the US as having issued licenses for arms to Saudi Arabia worth more than £18 billion in 2015.

The arms sold include drones, bombs, torpedoes, rockets and missiles, which have been used by Saudi Arabia and its allies for gross violations of human rights and possible war crimes during aerial and ground attacks in Yemen, the campaign group said. Control Arms Director Anna Macdonald said: “Governments such as the UK and France were leaders in seeking to secure an ATT – and now they are undermining the commitments they made to reduce human suffering by supplying Saudi Arabia with some of the deadliest weapons in the world. It’s truly sickening.”

British MPs from Cameron’s own party didn’t like it either, but what meaning does that have if it takes 5 years to issue a report, and moreover he can simply refuse to give evidence?

MPs Deliver Damning Verdict On David Cameron’s Libya Intervention

David Cameron’s intervention in Libya was carried out with no proper intelligence analysis, drifted into an unannounced goal of regime change and shirked its moral responsibility to help reconstruct the country following the fall of Muammar Gaddafi, according to a scathing report by the foreign affairs select committee. The failures led to the country becoming a failed a state on the verge of all-out civil war, the report adds. The report, the product of a parliamentary equivalent of the Chilcot inquiry into the Iraq war, closely echoes the criticisms widely made of Tony Blair’s intervention in Iraq, and may yet come to be as damaging to Cameron’s foreign policy legacy.

It concurs with Barack Obama’s assessment that the intervention was “a shitshow”, and repeats the US president’s claim that France and Britain lost interest in Libya after Gaddafi was overthrown. Cameron has refused to give evidence to the select committee. In one of his few reflections on his major military intervention, he blamed the Libyan people for failing to take their chance of democracy.

The committee, which has a majority of Conservative members, did not have Chilcot-style access to internal papers, but took voluminous evidence from senior ministers at the time, and other key players such as Blair, the chief of the defence staff, Lord Richards, and leading diplomats. The result of the French, British and US intervention, the report finds, “was political and economic collapse, inter-militia and inter-tribal warfare, humanitarian and migrant crises, widespread human rights violations, the spread of Gaddafi regime weapons across the region and the growth of Isil [Islamic State] in north Africa”.

It seems obvious that if there were an impartial international body with the power to prosecute, Bush, Cheney, Blair, Cameron, Hillary etc. etc. (don’t forget France) would be charged with war crimes. And Obama too: his ‘shitshow’ comment must be seen in light of the ‘we came we saw he died’ comment by Hillary Clinton, his Secretary of State. Think he didn’t know what was happening?

Another person who should be charged is Theresa May, Cameron’s Home Secretary from May 2010 till July 2016, and of course Britain’s present PM, who sells as much weaponry to Saudi Arabia as she possibly can while the Saudi’s are shoving the few Yemeni’s they leave alive back beyond the Stone Age. And then May has the gall to talk about humanitarian aid.

Theresa May Defends UK Ties With Saudi Arabia

Theresa May has defended her trip to Saudi Arabia, saying its ties with the UK are important for security and prosperity. The prime minister is facing questions about the UK’s support for the Saudi-led coalition which is fighting rebels in neighbouring Yemen. Labour Party leader Jeremy Corbyn said UK-made weapons were contributing to a “humanitarian catastrophe”. [..] Mrs May said humanitarian aid was one of the issues she would be discussing on her trip. “We are concerned about the humanitarian situation – that’s why the UK last year was the fourth largest donor to the Yemen in terms of humanitarian aid – £103m. We will be continuing with that,” she told the BBC.

[..] Mr Corbyn called for the immediate suspension of UK arms exports to Saudi Arabia. He criticised the “dictatorial Saudi monarchy’s shocking human rights record” and said the PM should focus on human rights and international law at the centre of her talks. “The Saudi-led coalition bombing in Yemen, backed by the British government, has left thousands dead, 21 million people in need of humanitarian assistance and three million refugees uprooted from their homes,” he said. “Yemen urgently needs a ceasefire, a political settlement, and food aid, not more bombing. “British-made weapons are being used in a war which has caused a humanitarian catastrophe.”

The one person who would probably not be in front of such a court is Jeremy Corbyn, opponent of May’s in the June 8 elections. Though there is the issue that he never protested in much stronger terms as an MP. Still, if you have to pick one of the two, what is not obvious?

Theresa May Claims Selling Arms To Saudi Arabia Helps ‘Keep People On The Streets Of Britain Safe’

Theresa May has staunchly defended selling arms to Saudi Arabia despite the country facing accusations of war crimes, insisting close ties “keep people on the streets of Britain safe”. Jeremy Corbyn called on the Prime Minister to halt those sales because of the “humanitarian devastation” caused by a Saudi-led coalition waging war against rebels in Yemen. The Labour leader spoke out after the Parliamentary committee charged with scrutinising arms exports said it was likely that British weapons had been used to violate international law.

The Saudis stand accused of bombing multiple international hospitals run by the charity Médecins Sans Frontières, as well as schools, wedding parties and food factories. In the Commons, Mr Corbyn linked weapons sales to the ongoing refugee crisis, which he said should be Britain’s “number one concern and our number one humanitarian response”. He added: “That is why I remain concerned that at the heart of this Government’s security strategy is apparently increased arms exports to the very part of the world that most immediately threatens our security.

The British Government continue to sell arms to Saudi Arabia that are being used to commit crimes against humanity in Yemen , as has been clearly detailed by the UN and other independent agencies.”

But, in response, Ms May pointed out she had called on Saudi Arabia to investigate the allegations about Yemen when she met with the kingdom’s deputy crown prince at the recent G20 summit in China. The Prime Minister dismissed Mr Corbyn’s suggestion that “what happened in Saudi Arabia was a threat to the safety of people here in the UK”. Instead, she said: “Actually, what matters is the strength of our relationship with Saudi Arabia. When it comes to counter-terrorism and dealing with terrorism, it is that relationship that has helped to keep people on the streets of Britain safe.”

May’s, and Britain’s, utterly mad stance in this is perhaps best exemplified, in one sentence, by her comments during the speedy trip she made to Turkey, again to sell more arms to an at best highly questionable regime. Why do it, why drag your entire nation through the moral gutter for $100 million or a few billion? The military industrial complex.

Theresa May Signs £100m Fighter Jet Deal With Turkey’s Erdogan

Theresa May issued a stern warning to Turkish president Recep Tayyip Erdogan about respecting human rights yesterday as she prepared to sign a £100m fighter jet deal that Downing Street hopes will lead to Britain becoming Turkey’s main defence partner.

And once again, no, none of this justifies the Manchester bombing. Neither a government nor an extremist movement has any right to kill innocent people. But let’s make sure we know that neither does.

There’s another aspect to the story. MI6 had close links to the Libyan community in Manchester.

‘Sorted’ by MI5: How UK Government Sent British-Libyans To Fight Gaddafi

The British government operated an “open door” policy that allowed Libyan exiles and British-Libyan citizens to join the 2011 uprising that toppled Muammar Gaddafi even though some had been subject to counter-terrorism control orders, Middle East Eye can reveal. Several former rebel fighters now back in the UK told MEE that they had been able to travel to Libya with “no questions asked” as authorities continued to investigate the background of a British-Libyan suicide bomber who killed 22 people in Monday’s attack in Manchester.

Salman Abedi, 22, the British-born son of exiled dissidents who returned to Libya as the revolution against Gaddafi gathered momentum, is also understood to have spent time in the North African country in 2011 and to have returned there on several subsequent occasions. Sources spoken to by MEE suggest that the government facilitated the travel of Libyan exiles and British-Libyan residents and citizens keen to fight against Gaddafi including some who it deemed to pose a potential security threat.

One British citizen with a Libyan background who was placed on a control order – effectively house arrest – because of fears that he would join militant groups in Iraq said he was “shocked” that he was able to travel to Libya in 2011 shortly after his control order was lifted. “I was allowed to go, no questions asked,” said the source. He said he had met several other British-Libyans in London who also had control orders lifted in 2011 as the war against Gaddafi intensified, with the UK, France and the US carrying out air strikes and deploying special forces soldiers in support of the rebels.

“They didn’t have passports, they were looking for fakes or a way to smuggle themselves across,” said the source. But within days of their control orders being lifted, British authorities returned their passports, he said. Many Libyan exiles in the UK with links to the LIFG [Libyan Islamic Fighting Group ] were placed on control orders and subjected to surveillance and monitoring following the rapprochement between the British and Libyan governments sealed by the so-called “Deal in the Desert” between then-British Prime Minister Tony Blair and Gaddafi in 2004.

According to documents retrieved from the ransacked offices of the Libyan intelligence agency following Gaddafi’s fall from power in 2011, British security services cracked down on Libyan dissidents in the UK as part of the deal, as well as assisting in the rendition of two senior LIFG leaders, Abdel Hakim Belhaj and Sami al-Saadi, to Tripoli where they allege they were tortured.

Torture one day, passports the other. Lovely. And it still gets better: MI6 didn’t just have close contacts with Libyans in Manchester, it knew the alleged perpetrator’s family, and used his father multiple times as on operative:

Manchester Attack as MI6 Blowback

According to Scotland Yard, the attack on the crowd leaving the Ariana Grande concert at Manchester Arena, 22 May, has been perpetrated by Salman Abedi. A bankcard has been conveniently found in the pocket of the mutilated corpse of the ‘terrorist’. This attack is generally interpreted as proof that the United Kingdom is not implicated in international terrorism and that, on the contrary, it is a victim of it.

[..] In 1992, Ramadan Abedi [Salman’s father] was sent back to Libya by Britain’s MI6 and was involved in a British-devised plot to assassinate Muammar Gaddafi. The operation having been readily exposed, he was exfiltrated by MI6 and transferred back to the UK where he obtained political asylum. He moved in 1999 to Whalley Range (south of Manchester) where there was already resident a small Libyan Islamist community. In 1994, Ramadan Abedi returned again to Libya under MI6’s direction. In late 1995 he is involved in the creation of the Libyan Islamic Fighting Group (LIFG), a local branch of Al-Qaeda, in conjunction with Abdelhakim Belhadj.

The LIFG was then employed by MI6 again to assassinate Gaddafi, for a payoff of £100,000. This operation, which also failed, provoked heated exchanges within British Intelligence, leading to the resignation of one David Shayler. Other former members of the LIFG have also lived at Whalley Range, including Abedi’s friend Abd al-Baset-Azzouz. In 2009, this last joined Al-Qaeda in Pakistan and became a close associate of its chief, Ayman al-Zawahiri. In 2011, al-Baset-Azzouz is active on the ground with the NATO operation against Libya.

On 11 September 2012, he directs the operation against the US Ambassador in Libya, Christopher Stevens, assassinated at Benghazi. He is arrested in Turkey and extradited to the US in December 2014, his trial still pending. Nobody pays attention to the fact that Ramadan Abedi has linked LIFG members to the formation of Al-Qaeda in Iraq and, in 2011, he takes part in MI6’s ‘Arab Spring’ operations, and in LIFG’s role on the ground in support of NATO. In any event, Abedi returned to Libya after the fall of Gaddafi and moves his family there, leaving his older children in the family home at Whalley Range.

According to the former Spanish Prime Minister José Maria Aznar, Abdelhakim Belhadj was involved in the assassinations in Madrid of 11 March 2004. Later, he is secretly arrested in Malaysia by the CIA and transferred to Libya where he is tortured not by Libyan or American functionaries but by MI6 agents. He is finally freed after the accord between Saif al-Islam Gaddafi [Gaddafi’s son] and the jihadists.

Luckily, perhaps the Brits are not that stupid:

Half of Britons Blame UK’s Foreign Wars for Terror Attacks at Home

Slightly over a half of people in the UK agree that the nation’s involvement in wars abroad has increased the terror threat to the country, a poll out Friday has showed. The survey found that 53% of 7,134 UK adults sampled by YouGov said they believed wars the UK supported or fought were in part responsible for terror attacks at home. [..] Labour leader Jeremy Corbyn, who made a speech earlier in the day to mark his return to general election campaigning, said UK’s war on terror had not worked. He cited intelligence experts who said foreign wars, including in Libya, threatened the country’s security.

If that is true, Theresa May obviously should have no chance of winning. May can and will try to use the horror of Manchester, and the subsequent pause in the campaign, to strengthen her position in the upcoming election, by playing on people’s fear and making them believe she’s in control. Even if the very attack itself makes clear that she’s not. The Tories have already attacked Corbyn for saying their policies have failed; it was the wrong time to say that, according to them.

But it’s not. It’s the very best time. This is when people pay attention. And having this discussion doesn’t disrespect the victims of Manchester. If anything, it shows more respect than not having the discussion. Because you want to make sure this doesn’t happen again, neither here nor there. And to achieve that, you have to look at why these things happen.

An 8-year old child in Manchester, just like one in Mosul or Aleppo, is innocent. Yourself, perhaps not so much. The politicians you vote into power, and the media you read and watch to inform you, not a chance. Guilty as hell.

 

 

Jul 022016
 
 July 2, 2016  Posted by at 8:18 am Finance Tagged with: , , , , , , , , ,  


Walker Evans Vicksburg, Mississippi. “Vicksburg Negroes and shop front.” 1936

Everyone’s a Winner in Brexit Aftermath as Doves Rescue Market (BBG)
The European Union Is ‘Doomed To Fail’ : Taleb (CNBC)
Hungary’s Migrant Referendum Shows Europe’s Post-Brexit Challenge (R.)
Kyle Bass Says China’s Corporate Bond Market Is ‘Freezing Up’ (BBG)
QE Only Works When You’re The Only Country Doing It: Kyle Bass (ZH)
Bad-Loan Ultimatum in India Sees Default Risk Climb Most in Asia (BBG)
World Biggest Pension Fund Seen Losing $43 Billion Last Quarter (BBG)
We May Have Reached Peak Pensioner (G.)
Hacked Emails Reveal US NATO General Plotting Against Obama (Intercept)
Australia Accused Of Torturing, Waterboarding Refugees (Ind.)

 

 

Bad news is good news again. No more uncertainty.

Everyone’s a Winner in Brexit Aftermath as Doves Rescue Market (BBG)

One week after Brexit, the lesson investors are taking away is that there’s no problem central banks can’t fix. Just days after the U.K.’s vote to leave the European Union roiled financial markets around the world, stocks and bonds surged in tandem this week as policy makers once again rode to the rescue, dropping hints of further stimulus and suggesting they’ll keep interest rates lower for longer. Traditionally, what’s good for one asset class has not been good for the other, and stocks and bonds more often move in opposite directions on the same information. Yet with unprecedented monetary easing showing no signs of slowing, that relationship continues to break down.

With almost $12 trillion of government bonds globally paying less than zero, a rush into Treasuries Friday pushed yields to record lows, even as encouraging economic data helped propel U.S. stocks toward all-time highs. “This may be the new normal,” said Aaron Kohli, a fixed-income strategist in New York at BMO Capital Markets, one of 23 primary dealers that trade with Fed. “If you flood the markets with liquidity, and you have the anticipation that the central banks are going to be dovish — either adding to quantitative easing or becoming less hawkish, as the case may be for the U.S. Fed — any assets that aren’t impaired or encumbered are going to do very well.”

Read more …

“This is 2016. They are still thinking 1950 economics..”

The European Union Is ‘Doomed To Fail’ : Taleb (CNBC)

The European Union is doomed to fail, “Black Swan” author Nassim Nicholas Taleb said Thursday. He told CNBC’s “Power Lunch” the EU has become a “metastatic and rather incompetent bureaucracy” that is too intrusive. “The way they’ve been building it top down from Brussels is doomed to fail. This is 2016. They are still thinking 1950 economics,” said Taleb, who is also the author of “Antifragile” and is an advisor to Universa Investments. Taleb has warned about an EU breakup for some time, calling it a horrible, stupid project back in 2012. In fact, the U.K.’s vote to exit the EU last week didn’t turn out to be the catastrophe that was expected, he said. While Brexit fears initially rattled global markets, stocks have been climbing back up over the last few days.

While he’s against the current bureaucracy in place in the Europe, he still believes countries can work together, forming free trade agreements and joint military and economic policies. He envisions an Anglo-Saxon economic zone that encompasses the U.S., Ireland, Scotland and Britain. Taleb also doesn’t see Brexit as an isolated event. “People just realize that these elites don’t know what they’re talking about. It’s nice to have elites..you don’t want them to tell you what to do,” he said. “So they are tired of that and it’s a rebellion.” “You have waves and of course we have a wave and I think that .. it’s spreading.” That can be seen in the popularity of Donald Trump, he added. “He’s a brilliant salesperson. He knows how to sell you real estate.. He knows what people want. And he detected exactly that point. And he’s delivering but through trial and error.

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Note: On July 1, Slovakia took over from Holland as chair of the EU. Slovakia is very much opposed to the migrant quota plans.

And Orban is a dick, but he poses a basic question on sovereignty. Which the EU should not just try to sweep under the carpet, because it represents the very core of all the issues. It’s worrisome to me that the right seems to be the only side asking the right questions these days.

Hungary’s Migrant Referendum Shows Europe’s Post-Brexit Challenge (R.)

Emboldened by Britain’s shock vote to quit the EU, Hungary’s leader Viktor Orban is forging ahead with his own referendum on migration, in what European diplomats see as a sign of battles to come with anti-Brussels populists across the continent. The 53-year-old Orban, in power since 2010, has clashed several times with the EU on issues ranging from independence of the courts and the central bank to his handling of the migrant crisis, which has included a fence on Hungary’s southern border. His next clash pits him against an EU Commission plan to resettle refugees across member states based on quotas, which Orban sees as an act of out-of-touch Brussels bureaucrats usurping national authority.

“We need to fight to prove to people that it is possible to form an EU migration policy that is in line with the Hungarian national interest,” Orban said days after the Brexit vote. “This is going to be a long struggle for which I will need a strong mandate, which cannot be ensured without a referendum,” said Orban, who is in favor of remaining in the EU but wants more powers for member states. Orban has enlisted allies, such as neighboring Slovakia, which also opposes the quotas and this week joined a chorus of eastern EU states calling for the powers of the EU Commission to be reined in after Britain’s vote to leave.

“We have a big problem with the proposed reform of the Dublin system,” Slovak Prime Minister Robert Fico said. “We think it’s stupid, because this is exactly what will keep dividing Europe if (countries) will be asked to pay €250,000 for each migrant they refuse to take.” [..] Orban has said the migration crisis could drive more countries out of the EU. His government will ask Hungarians: “Do you agree that the European Union should be able to prescribe the mandatory settlement of non-Hungarian citizens in Hungary without the consent of parliament?”

Read more …

“..the largest macro imbalance in world history..” People who’ve been reading me for a while will know I fully agree with Bass. Except perhaps for his optimism about China as a buying opportunity. You must take into account, in my view, the inevitable massive losses for Chinese citizens, and their potential reaction to them.

Kyle Bass Says China’s Corporate Bond Market Is ‘Freezing Up’ (BBG)

Kyle Bass, the hedge-fund manager who’s wagering on a devaluation in China, said the country’s $3 trillion corporate bond market is “freezing up” amid rising defaults and canceled debt sales. “We’re starting to see the beginning of the Chinese machine literally break down,” Bass, the founder Hayman Capital Management, said in an interview on Real Vision. China’s corporate bond market contracted by a record in May as tepid economic growth and a raft of missed payments spooked investors. Seventeen publicly-traded Chinese bonds have defaulted so far this year, up from six in 2015, and at least 188 firms have scrapped or delayed debt sales since the end of March, according to data compiled by Bloomberg.

Bass, who rose to fame after prescient bets against U.S. subprime mortgages, has so far had less success with his China wagers, saying they’ve contributed to his “terrible” performance over the past two years. While his corporate bond warning follows signs of market stress, there’s no evidence yet of a collapse. Yields on junk-rated Chinese debt fell the most this year in June, while companies were able to sell 1.85 trillion yuan ($278 billion) of onshore notes in the second quarter. Defaults have ramifications beyond the corporate debt market, according to Bass. It also threatens to undermine the $3.5 trillion market for wealth management products, which raise money from Chinese individuals to invest in bonds, stocks and derivatives, he said.

The products receive less regulatory oversight than banks and often have mismatches between their maturities and underlying assets. Bass said in February that China’s lenders may suffer losses more than four times those at American banks during the 2008 credit crisis. He also predicted the yuan will fall in excess of 30%. In the Real Vision interview, Bass reiterated that China’s lending binge in recent years has created “the largest macro imbalance in world history.” He expects bank losses of $3 trillion to trigger a bailout, with the central bank slashing reserve requirements, cutting the deposit rate to zero and expanding its balance sheet – all of which will weigh on the yuan.

Read more …

Great interview with Bass.

QE Only Works When You’re The Only Country Doing It: Kyle Bass (ZH)

Grant : this idea of helicopter money, and the idea of banning cash, and all these things that, when you sit here in the cold like that, you can see exactly why they need to do these things. You watch the narrative unfold in the media, and then the trial balloons get floated. But you’re right, they have to go to helicopter money, they’re really not going to have a choice. And it seems to me that they are going to have to try to ban cash. Because, as you say, the U.S. savings rate has tripled since 2007, and that’s literally the last thing they want or need. So is there any way out for these guys? Because that’s the thesis that I keep checking. I can’t see a way out, absent cold fusion.

Kyle : Look, I had a fascinating out of body experience meeting with one of the world’s top central bankers in a private meeting about three years ago. And he said, “You know Kyle, quantitative easing only works when you’re the only country doing it.” He would never say that publicly. And I’ll protect his name, because it was a private meeting. But it was one of those moments where I…it was one of those epiphanies almost, where it’s something you and I knew, but hearing him say it, call it one of the four top central bankers in the world, it was a jarring experience for me, because when I look around the world today, everyone’s in the same boat. So we’re all trying…we’re attempting through our treasury and our Fed to get the rest of the world to not devalue against us, while we quietly attempt to devalue ourselves against them, and it’s all this…it is the race to the bottom, it is the beggar thy neighbor policies that we all talk about. And I believe that there is no way out.

Read more …

Another economic miracle showing rot.

Bad-Loan Ultimatum in India Sees Default Risk Climb Most in Asia (BBG)

Investors are starting to show nerves over the Reserve Bank of India’s ultimatum for state lenders to clean up their rising pile of bad loans this fiscal year. Bank of India’s credit-default swaps jumped 31 basis points in the past month, the most among Asian banks, after it was one of three lenders downgraded by S&P Global Ratings on May 30. Yield premiums on dollar bonds of the Mumbai-based company, Indian Overseas Bank and Syndicate Bank climbed to the highest in at least four months after the action. “It’s one of the most trying times for the public sector banks and how they handle this will be crucial for their future survival,” said Rajesh Mokashi at CARE Ratings. “I see a substantial jump in non-performing loans for most banks for the year to March 31, 2017.”

RBI Governor Raghuram Rajan, who will hand over the reins to an as-yet-undecided successor in September, has given lenders until March 31 to clean up stressed loans that surged to 11.5% of their assets last fiscal year. The rating downgrades will make it harder to raise capital for India’s state-owned commercial lenders, which issued no dollar bonds this year, versus $895 million in the first half of last year.

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From AAA to stocks. It took only a few years. And there goes your pension.

World Biggest Pension Fund Seen Losing $43 Billion Last Quarter (BBG)

Losses for the world’s biggest pension fund likely deepened in the quarter just ended, extending what may be its worst annual loss since the global financial crisis, brokerage estimates showed. Japan’s Government Pension Investment Fund will probably post a 4.4 trillion yen ($43 billion) loss in the April-June quarter, according to calculations by Yohei Iwao, executive director of the institutional equities division at Morgan Stanley MUFG Securities. That follows what he estimates was a 5 trillion yen decline in the fiscal year ended March 31, which would amount to the worst performance since fiscal 2009 when the fund lost 9.7 trillion yen.

The calculations come amid criticism the government has put the public’s pension money at risk after the fund known as the whale for the size of its assets increased its equity allocations in 2014. That’s prompted the main opposition party to pledge GPIF will move investments back into safer ones in its manifesto ahead of elections this month. “Looks like the scrutiny on GPIF will continue,” Morgan Stanley MUFG’s Iwao said. GPIF has been hurt after global stock routs in mid-2015 and early this year helped wipe about $7.4 trillion off world equities in the past 12 months. Japan’s Topix index has tumbled 19% in 2016 to be the second-worst performing developed stock market as the yen strengthened, reducing returns from overseas holdings.

Read more …

No politician wants to touch this. Not in their timeframe.

We May Have Reached Peak Pensioner (G.)

Since 2004-05 the average income of all pensioners has jumped from £250 a week to £297. For pensioner couples the average income is £444, or £23,000 a year. During the same period, incomes for working people have stagnated or fallen; even today, average net disposable income is below where it was in 2007-08. Two factors have driven pensioner incomes up: first, the “triple lock” for state pensions, which has guaranteed that it rises every year by the highest of price inflation, earnings growth or 2.5%. During the global financial crash the triple lock meant pensioners received income rises even when pay for working people was falling. Income from welfare benefits has increased for pensioners since 1994-95, but fallen for working people.

[..] generous final salary pension schemes are in catastrophic decline, now confined almost entirely to the public sector. In the private sector their replacements will only pay a fraction of the amount enjoyed by the generation before them. While many previously picked up two-thirds of their final salary, today’s workers will be lucky to pick up 25%-30% of their former salary. Today’s well-off pensioners are, literally, a dying breed. This is not an argument to say that today’s pensioners should in any way be stripped of their incomes. There is huge inequality among pensioners themselves.

You know all those stories about pensioners saying their incomes have been destroyed by a decade of super-low interest rates? The truth is that the median weekly income from savings in retirement is just £6 a week. The average, though, is £64 a week. That tells you that a small number of pensioners have a large investment income, but the majority have almost nothing. There is a debate to be had about generational fairness. Britain, like all developed nations, is an ageing country. How do we arrange our national finances so that the elderly are protected, while at the same time the young are not overly burdened paying for it?

The problem is that the reforms suggested so far fall on today’s working generation. For example, the age at which you will qualify for the state pension is rising steeply. That’s an inevitable consequence of improved longevity, but one that will hit people in their late 50s, especially women, hard, not the existing retired. Another widely mooted reform is to slash pension tax relief, but the losers there are again the existing working population. Should better-off pensioners be expected to pay more as well? Maybe. But as we know from the referendum result, the old vote and the young don’t.

Read more …

Breedlove is a nasty piece of work. So is NATO.

Hacked Emails Reveal US NATO General Plotting Against Obama (Intercept)

Retired U.S. Air Force Gen. Philip Breedlove, until recently the supreme commander of NATO forces in Europe, plotted in private to overcome President Barack Obama’s reluctance to escalate military tensions with Russia over the war in Ukraine in 2014, according to apparently hacked emails from Breedlove’s Gmail account that were posted on a new website called DC Leaks. Obama defied political pressure from hawks in Congress and the military to provide lethal assistance to the Ukrainian government, fearing that doing so would increase the bloodshed and provide Russian President Vladimir Putin with the justification for deeper incursions into the country.

Breedlove, during briefings to Congress, notably contradicted the Obama administration regarding the situation in Ukraine, leading to news stories about conflict between the general and Obama. But the leaked emails provide an even more dramatic picture of the intense back-channel lobbying for the Obama administration to begin a proxy war with Russia in Ukraine. In a series of messages in 2014, Breedlove sought meetings with former Secretary of State Colin Powell, asking for advice on how to pressure the Obama administration to take a more aggressive posture towards Russia.

“I may be wrong, … but I do not see this WH really ‘engaged’ by working with Europe/NATO. Frankly I think we are a ‘worry,’ … ie a threat to get the nation drug into a conflict,” Breedlove wrote in an email to Powell, who responded by accepting an invitation to meet and discuss the dilemma. “I seek your counsel on two fronts,” Breedlove continued, “… how to frame this opportunity in a time where all eyes [sic] on ISIL all the time, … and two,… how to work this personally with the POTUS.”

Read more …

Unbelievable. Australians themselves need to address their government’s despicable behavior.

Australia Accused Of Torturing, Waterboarding Refugees (Ind.)

[..] in a devastating critique of Australia’s methods, medical ethicists have warned there is “increasing evidence that Australia is engaged in torturing asylum seekers” with refugees imprisoned for more than a year without trial. There are allegations of waterboarding, another method of torture called “zipping” in which people are tied to a bed that is then thrown into the air, sexual assault and exploitation, and child abuse. And the inmates of detention centres created outside of Australia to avoid its laws are held in conditions of secrecy that prevent scrutiny of their treatment while laws prevent doctors speaking out about mistreatment.

Last year, a United Nations report accused Australia of breaking the Convention Against Torture over its treatment of migrants. The then Prime Minister, Tony Abbott, responded that “Australians are sick of being lectured to by the United Nations”, saying their policies had stopped refugee boats from trying to make the perilous sea journey to Australia and “ended the deaths at sea”. In a paper in the Journal of Medical Ethics, the ethicists, Dr John-Paul Sanggaran, of the University of New South Wales, and Professor Deborah Zion, of Victoria University, wrote that there was “increasing evidence that Australia is engaged in torturing asylum seekers”.

“There are allegations of situations, circumstances and actions that also constitute cruel and unusual punishment throughout Australian immigration detention,” they wrote. They pointed to allegations by guards at a detention centre on the island of Nauru “of waterboarding, familiar to most as a torture technique that simulates drowning used by the CIA in places like Guantanamo bay”. “‘Zipping’ is also alleged. It is described as tying an individual to a metal bed frame with cable ties, the bed is then thrown into the air causing injury to the bound individual when the frame crashes to the ground,” they added.

Read more …

Jan 182015
 
 January 18, 2015  Posted by at 11:27 am Finance Tagged with: , , , , , , , , , ,  


DPC Main Street north from Sixth, Little Rock, Arkansas 1911

How The US Dollar Stacks Up Against Major World Currencies (AP)
This Is The Case For A ‘Large, Sharp Correction’ (CNBC)
Copper’s Rout May Be A Red Flag (MarketWatch)
Swiss Central Bank’s Shock Therapy Leaves Policy Vacuum (Reuters)
Swiss Franc Trade Is Said to Wipe Out Everest’s Main Fund (Bloomberg)
Making Sense Of The Swiss Shock (Project Syndicate)
Beware Of Politicians Bearing Household Analogies (Steve Keen)
Draghi Primes His Rocket, Could End Up Shooting Europe In The Foot (Observer)
Market to European Central Bank: Size of QE Matters! (CNBC)
A New Idea Steals Across Europe – Should Greece Debt Be Forgiven? (Observer)
Ireland ‘Not Dismissive’ Of EU Debt Conference SYRIZA Wants (Kathimirini)
Aberdeen: In Scotland’s Oil Capital The Party’s Not Yet Over (Observer)
Buying A Home In Britain Should Not Be An Impossible Dream (Observer)
Obama’s State Of The Union To Call For Closing Tax Loopholes (Reuters)
Russia May Lift Food Import Ban From Greece If It Quits EU (TASS)
Donetsk Shelled As Kiev ‘Orders Massive Fire’ On East Ukraine (RT)
New Snowden Docs Reveal Scope Of NSA Preparations For Cyber War (Spiegel)
Guantánamo Diary Exposes Brutality Of US Rendition And Torture (Guardian)
Price Tag Of Saving The World From A Pandemic: $344 Billion (CNBC)
Is Lancashire Ready For Its Fracking Revolution? (Observer)
Pope Francis: Listen To Women, Men Are Too Machista (RT)

“The dollar has soared a staggering 96% against the Russian ruble since June 30.”

How The US Dollar Stacks Up Against Major World Currencies (AP)

The U.S. dollar has been rolling. Since June 30, its value has jumped 16% against a collection of world currencies. Investors are embracing the dollar because the U.S. economy is strong, especially compared with most other nations. U.S. economic growth clocked in at a 5% annual rate from July through September, the fastest quarterly pace in more than a decade. During 2014, American employers added nearly 3 million jobs, the most in any year since 1999. Investors also like the safety of U.S. Treasurys, which pay a higher yield than government bonds in Japan and most big European countries do. Another lure: The Federal Reserve is expected to raise short-term interest rates this summer or fall, making U.S. rates even more attractive for investors. But the dollar’s strength also reflects weakness elsewhere:

• JAPAN: The dollar is up 16% against the Japanese yen since mid-2014. Japan slid into recession last quarter after the government imposed an ill-timed sales tax increase. The Bank of Japan has tried to revive the economy by buying bonds to lower rates, boost inflation and drive down the value of the yen to aid Japanese exporters.

• EURO: The dollar has surged 18% against the euro since June 30. Economic growth among the 19 countries that use the euro has flat-lined. Last year, the European Central Bank slashed rates and sought to stimulate lending by promising to buy bundles of bank loans. Next week, the ECB is expected to announce a program to buy bonds — a version of what the Fed did three times since 2008 — to lower long-term rates and stimulate the eurozone economy.

• BRAZIL: The dollar has gained nearly 20% against the Brazilian real since the middle of last year. The Brazilian economy is beset by a combination of slow growth and high inflation. The Brazilian Central Bank will likely raise rates next week to try to fight inflation and rally the real, economists at Barclays predict.

• RUSSIA: The dollar has soared a staggering 96% against the Russian ruble since June 30. Plummeting oil prices and economic sanctions have devastated the Russian economy, which is likely headed toward recession. Money is fleeing the country. In mid-December, the Russian central bank raised rates to try to salvage the currency. The move has at least slowed the free-fall.

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“People are underestimating what a strong U.S. dollar can do and oil is just one of those things.”

This Is The Case For A ‘Large, Sharp Correction’ (CNBC)

Pain in the market may just be getting started, according to Raoul Pal of the Global Macro Investor. “The chance of a large sharp correction? Absolutely, because volatility is there and people will be forced to reduce risk, ” Pal said on CNBC’s “Fast Money.” “I would put that as a reasonably high probability that the S&P falls possibly from here down to the 1,800 level.” Pal thinks there will be a lot of volatility in the market this year and currency volatility will be the driving force. He expects the sharp currency moves that have happened globally to hit the U.S. equity markets. A violent move in the Swiss franc on Thursday shook investors as the Switzerland National Bank removed its cap on its currency relative to the euro.

The cap was in place to prevent the franc from gaining ground against the euro while Europe remained in recovery mode. Switzerland has been a beacon of financial stability throughout the euro zone’s recession. Brokerage and financial firms reported millions of dollars of losses from the sudden gains in the Swiss franc on Thursday and that may not be the end of it. Currency swings are an issue at home with the U.S. dollar on a tear over the past year. “The biggest risk to U.S. equities is if the long dollar trades unwind. If that happens, then you may see people unwinding their stock positions as well,” said “Fast Money” trader Brian Kelly.

Pal also believes a strengthening dollar will be part of the U.S. market downfall this year, “People are underestimating what a strong U.S. dollar can do and oil is just one of those things.” Oil is down nearly 10% so far this year and that’s after a 45% drop in 2014. Pal isn’t alone in pointing to hard times ahead in the market. On Wednesday, Dennis Gartman told Fast Money he was now net short of stocks. “As of this afternoon, I am slightly, very slightly net short.” As the markets sold off, Gartman did say that he was long the tanker stocks, which had managed to rise on the back of falling oil prices.

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Chinese data coming this week.

Copper’s Rout May Be A Red Flag (MarketWatch)

Economists are bullish on growth, but copper’s big plunge on Wednesday appeared to be suggesting that +they’re wrong. For investors, the crucial question is ‘Who is right?’ An ugly 24-hour period drove copper to mid-2009 lows on Wednesday—it fell 5% to $2.1590 a pound. In New York on Tuesday, copper fell 8 cents, but the big crack came later in that day when it crashed through key support at $6,000 a tonne on the London Metal Exchange. That drop was followed by heavy falls in Shanghai on Wednesday, said Ole Hansen, Saxo Bank’s head of commodity strategy.

Known as Dr Copper, the commodity is a chief building and manufacturing material and to some a harbinger of the global economy. So when investors start to bail on it, some say that is a sign of the proverbial canary in the coal mine is starting to keel over. Some blamed copper’s losses on the World Bank, which cut its global-growth outlook, including for China, a country that is a big global buyer of copper. Investors inured to oil serving as the whipping boy for the market’s global-growth worries, were taken aback by yet another commodity caving. Copper falling alone would be less of a worry for Adam Sarhan, chief executive officer of Sarhan Capital. A range of commodities, hard and soft, have joined oil lower: gasoline, corn, sugar, to name a few, Sarhan said.

A combination of this pressure “supports that notion that deflation is getting stronger not weaker and if that is the case then that bodes poorly for both main street and Wall Street,” he said. For its part, oil has lost nearly 60% of its value since peaking in June. Equally concerned was Keith McCullough, CEO of Hedgeye Risk Management, who says he has been telling his clients to short copper for months. “Oil, copper, etc.—they are all legacy carry trades associated with the simple expectation that the Fed could perpetually inflate asset prices,” he said. “Now deflation is dominating expectations, and all of those who underestimated how nasty the deleveraging associated with deflation can be,” said McCullough.

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“.. a serious threat for tens of thousands of Swiss jobs.”

Swiss Central Bank’s Shock Therapy Leaves Policy Vacuum (Reuters)

The Swiss National Bank had little choice but to abandon its three-year-old cap on the franc but its execution of the move left a vacuum of policy uncertainty where a pillar of stability stood before. With the euro diving against the dollar as the European Central Bank gears up for fresh stimulus as early as next week, the SNB felt the 1.20-francs-per-euro cap was not sustainable and chose to give it up rather than accumulate further risk. Yet in pulling off the move, the SNB – a conservative institution in a safe-haven state – failed to tip off its peers and shocked investors, who were left wondering whether central banks are now less a source of stability and more one of a risk. “The bottom line: central banks are a lot less predictable than in the past few years,” said Christian Gattiker, chief strategist at Swiss bank Julius Baer. The SNB, whose three board members make their decisions behind closed doors, acted in isolation.

IMF Managing Director Christine Lagarde lamented the lack of a warning from SNB Chairman Thomas Jordan. “I find it a bit surprising that he did not contact me,” she said. For ECB policymaker Ewald Nowotny, the move was “a surprising decision”. In contrast with the ECB, which has 25 policymakers from across the continent who debate major decisions, just three men call the shots at the SNB, albeit in consultation with staff advisers. Details of ECB policy debates often leak because of the large numbers of officials also involved; if President Mario Draghi announces next week that the ECB is to launch quantitative easing, he will surprise no one. Draghi has made no secret of the fact that such a programme is under discussion on the ECB Governing Council.

While officials at central banks generally play down the idea that they offer each other advance notice, they almost always prepare financial markets, businesses and each other for important policy shifts by openly discussing their thinking in the run up to any move. But Adam Posen, a former Bank of England official who heads the Peterson Institute for Economics in Washington, said transparency at times needed to be sacrificed. “Central bank communication is overrated,” Posen said at an event in Washington when asked about the SNB’s move. It’s more important to get a policy right than to stick to a “foolish consistency” of communicating everything, he said. For exporters and the tourism industry in Switzerland, the move that has led to a near 18% rise in the franc against the euro is far from understandable. Christian Levrat, president of the left-wing Social Democrat party, called the move “a serious threat for tens of thousands of Swiss jobs”.

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And many more.

Swiss Franc Trade Is Said to Wipe Out Everest’s Main Fund (Bloomberg)

Marko Dimitrijevic, the hedge fund manager who survived at least five emerging market debt crises, is closing his largest hedge fund after losing virtually all its money this week when the Swiss National Bank unexpectedly let the franc trade freely against the euro, according to a person familiar with the firm. Everest Capital’s Global Fund had about $830 million in assets as of the end of December, according to a client report. The Miami-based firm, which specializes in emerging markets, still manages seven funds with about $2.2 billion in assets. The global fund, the firm’s oldest, was betting the Swiss franc would decline. The SNB’s decision to end its three-year policy of capping the franc at 1.20 a euro triggered losses at Citigroup, Deutsche Bank and Barclays as well as hedge funds and mutual funds.

The franc surged as much as 41% versus the euro on Jan. 15, the biggest gain on record, and climbed more than 15% against all of the more than 150 currencies tracked by Bloomberg. Everest grew to $2.7 billion by the start of 1998 after navigating crises in Mexico and Southeast Asia. Russia’s default and currency devaluation proved trickier and assets fell by half amid losses. He revived the firm and a decade later Everest managed $3 billion. Then the global financial crisis hit, and assets shrunk by $1 billion. Last year, the main fund rose 14.1%, driven by Chinese equities and bets against currencies, including a wager that the Swiss franc would fall after citizens rejected a referendum that would require the central bank to hold at least 20% of its assets in gold, the investor report said.

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“The negative effects for the Swiss economy – through the decreased competiveness of its export industries (including tourism and medicine) – may already be showing that abandoning the euro peg was not a good idea.”

Making Sense Of The Swiss Shock (Project Syndicate)

There is historical precedent for the victory of political pressure, and for the recent Swiss action. In the late 1960s, the Bundesbank had to buy dollar assets in order to stop the Deutsche mark from rising, and to preserve the integrity of its fixed exchange rate. The discussion in Germany focused on the risks to the Bundesbank’s balance sheet, as well as on the inflationary pressures that came from the currency peg. Some German conservatives at the time would have liked to buy gold, but the Bundesbank had promised the Fed that it would not put the dollar under downward pressure by selling its reserves for gold. In 1969, Germany unilaterally revalued the Deutsche mark. But that was not enough to stop inflows of foreign currency, and the Bundesbank was obliged to continue to intervene. It continued to reduce its interest rate, but the inflows persisted. In May 1971, the German government – against the wishes of the Bundesbank – abandoned the dollar peg altogether and floated the currency.

Politics had prevailed over central-bank commitments. Within three months, the fallout destroyed the entire international monetary system, and US President Richard Nixon took the dollar off the gold standard. The credibility of the entire system of central bank commitments had collapsed, and international monetary policy became extremely unstable. The Deutsche mark appreciated, and life became very hard for German exporters. Today, the global ramifications of a major central bank’s actions are much more pronounced than in 1971. When the Bundesbank acted unilaterally, German banks were not very international. But now finance is global, implying large balance-sheet exposures to currency swings. Big Swiss banks fund themselves in Swiss francs, because so many people everywhere want the security of franc assets. They then acquire assets worldwide, in other currencies. When the exchange rate changes abruptly, the banks face large losses – a large-scale version of naive Hungarian homeowners’ strategy of borrowing in Swiss francs to finance their mortgages.

Though the SNB had given many warnings that the euro peg was not permanent, and though it had imposed a higher capital ratio on banks, the uncoupling from the euro came as a huge shock. Swiss bank shares fell faster than the general Swiss index. The risks created by the SNB’s decision – as transmitted through the financial system – have a fat tail. The negative effects for the Swiss economy – through the decreased competiveness of its export industries (including tourism and medicine) – may already be showing that abandoning the euro peg was not a good idea. But the consequences will not be limited to Switzerland. After years of wondering whether the exit of a small, fiscally weak country like Greece could undermine the euro, policymakers will have to deal with an even bigger shock stemming from the exit of a small, fiscally strong country that is not even a member of the European Union.

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Steve’s first piece for Forbes.

Beware Of Politicians Bearing Household Analogies (Steve Keen)

The British election campaign has begun, and Prime Minister David Cameron is running with the slogan that his Conservative Party will deliver “A Britain living within its means” by running a surplus on day-to-day government spending by 2017/18. It is, as the UK Telegraph noted, hardly an inspiring slogan. But it is one that resonates with voters, because it sounds like the way they would like to manage their own households. And a household budget—whether you balance yours or not—is something we can all understand. If a household spends less than it earns, it can save money, or pay down its debt, or both. So it has to be good if a country does the same thing, right? If only it worked that way. In fact, a government surplus has the opposite effect on Joe Public: a government surplus means that the public has to either run down its savings, or increase its debt.

And if the government runs a sustained surplus, then—unless the country in question has a huge export surplus, like Japan or Germany—a financial crisis is inevitable. That’s the opposite of what both politicians and most of the public think that running a government surplus will achieve—and yet it’s easy to prove that that is the outcome a sustained surplus will lead to. Firstly, a government surplus means that, in a given year, the taxes the government imposes on the public exceed the money it spends (and gives) to the public. There is therefore a net flow of money from the public to the government. As a once-off, that doesn’t have to be a problem. But if it’s sustained for many years, then the public has to provide a continuous flow of money to the government. Let’s call this flow NetGov: a sustained surplus requires the situation shown in Figure 1 (where a deficit is shown in red and a surplus in black).


Figure 1: A sustained government surplus requires the private sector to supply the government with a continuous flow of money

One way that the public can do this is to run down its own money stock—to reduce its savings. But that’s the opposite of what the policy is intended to achieve: the expectation of enthusiasts for government surpluses is that it will enable the public to save more, not less. But as a simple matter of accounting, increased public savings—increased balances in the public’s bank accounts—are only compatible with a government surplus if the public can produce more money than it pays to the government to maintain its surplus. This raises the question “how does the public produce money?”. Anyone in the private sector can produce goods and services for sale, but the production of money is a very different thing to production of goods. The public in general can’t “produce money”—but the banks can.

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Draghi should leave, and Weidmann be appointed head of the ECB.

Draghi Primes His Rocket, Could End Up Shooting Europe In The Foot (Observer)

Mario Draghi, the urbane boss of the European Central Bank, is about to print hundreds of billions of euros to rescue the faltering continental economy. The City expects him to launch his financial bazooka, otherwise known as quantitative easing (QE), on Thursday after the central bank governing council’s monthly meeting. His hand was forced last week by events in Zurich, where his Swiss counterpart said the policy of pegging the franc to the euro was no longer tenable. The markets were impatient for QE, the Swiss central bank chief said – they have already waited months for a decision. The ECB funds will begin to flow six years after the world’s other major economies adopted QE. The US has spent around $4 trillion, the UK £375bn, and last year the Japanese promised to spend almost $700bn a year, up from $560bn in 2013.

If Draghi goes ahead, the Super-Mario headlines will proliferate across Europe and gigabytes of the web will be devoted to analysing the consequences of the move for the 19-member currency zone – and for its trading partners, such as the UK. The ECB’s aim is to flood the eurozone banking system with money to boost lending after a collapse in the value of consumer and business borrowing. Draghi’s supporters say the very fact of taking action will increase confidence and invigorate a stuttering economic bloc. According to this argument, Brussels has done little apart from impose austerity. Now, with the ECB throwing its weight behind a strategy for growth, confidence and spending will begin to rise.

QE has clearly played a big part in rescuing the global economic system after the crash. But its usefulness as a spur for growth is less clear. As Labour’s Ed Balls has said, governments need to step in with their own funds – albeit borrowed – for investment that ensures growth is sustainable. QE is like an adrenalin shot to revive a stricken patient. It is useless when the patient is in recovery and crying out for something more substantial. But persistently printing vast quantities of a currency has one major effect. It drives down its value against other currencies. Since Christmas, the yen has been trading 50% below where it was in October 2012 against the dollar. That means Japanese exports of cars, TVs and kimonos cost 50% less in the US and, just as importantly, in China, which has pegged the renminbi to the dollar.

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No, it doesn’t. Well, other than for bringing down the euro. All else has long been priced in.

Market to European Central Bank: Size of QE Matters! (CNBC)

Earnings and economic reports all take a back seat to the European Central Bank in the holiday-shortened trading week ahead. Investors are looking to the ECB to on Thursday announce a program of government bond purchases, or quantitative easing. “The only thing that is important next week is the ECB meeting,” Mark Luschini, chief investment strategist at Janney Montgomery Scott, said. “The ECB is going to be the biggest driver next week, what they decide to do as far as rates and their QE should have a big impact on global markets,” said Paul Nolte at Kingsview Asset Management.

“The markets are expecting a very impressive QE, a la United States, a la Japan. Some investors may be playing both sides, and by that I mean playing for a big move. If they do come down with a big package, global markets will rally strongly, if they don’t do much of anything, you could see markets fall apart,” Nolte said. “There’s a huge amount of anticipation, and a lot of volatility around this ECB decision on Thursday. It’ll be a combination of what they say they’re going to do, and their intentions after that,” Scott Wren, senior equity strategist at Wells Fargo Investment Institute, said.

“I think the ECB will act next week, and make some type of announcement. But the market is likely to be disappointed by the magnitude that the ECB initially says they’re going to do, as the market would like to see a trillion. Let’s say they come out with €500 billion, and some sort of statement of more”. Switzerland’s central bank upended markets Thursday by removing its cap on the Swiss franc versus the euro, with the action viewed as a preemptive one to shield its currency from pressure should the ECB make a move. “I suspect (ECB President Mario) Draghi gave a wink to the Swiss National Bank and allowed them to get in front of that, the question mark at this juncture is the order of magnitude. The market is vulnerable to an underwhelming response. The key, basically, is trying to restore the balance sheet to 2012 levels, so we’d have to at least have to see €1.3 trillion,” Luschini said.

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“The country’s overall debt burden has actually increased in the almost five years since it was first “rescued..”

A New Idea Steals Across Europe – Should Greece Debt Be Forgiven? (Observer)

Forgiveness: it’s a rare enough quality in family life, let alone international policymaking. But if, as the polls suggest, the populist Syriza party wins next weekend’s Greek election, Athens will be asking its European brothers and sisters to forgive and forget some of the €317bn (£240bn) it still owes, so that its economy – and society – can recover from more than six years of austerity and recession. Instead of the defiant tone that once saw Syriza’s leader, Alexis Tsipras, threatening to ditch the euro altogether, the party now hopes to negotiate an agreement with Germany and other creditors that could allow Greece to remain in the single currency – but set it on the path to recovery.

London-based pressure group Jubilee Debt Campaign, which has studied the fate of heavily indebted countries around the world, says Greece is right to demand a more generous approach from its creditors, because although it has received an extraordinary €252bn in bailouts since 2010, just 10% of that has found its way into public spending. Much of the rest poured straight back out of the country: in debt repayments and interest to its creditors, many of them banks and hedge funds in the core eurozone countries, including Germany and France; and in sweeteners to persuade lenders to sign up to the 2012 bond restructuring that helped prevent the country crashing out of the euro. In effect, the “troika” of the European Central Bank, the International Monetary Fund and the European commission has simply replaced the banks and the hedge funds as Greece’s paymasters.

The country’s overall debt burden has actually increased in the almost five years since it was first “rescued”, and of the amount still outstanding, 78% is now owed to public sector institutions, primarily the EU. Stephany Griffith-Jones, an economist who is an expert on debt crises in developing countries, says: “They have got quite a lot of relief already; but a lot of that money that came to the government has gone to servicing the debt, including to the private banks. It wasn’t really money to help the Greeks. This is exactly like when I used to study Latin America in the 1980s: then, it was American and British banks, now it’s German and French banks.”

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Of coursethere should be such a conference. A fully public one.

Ireland ‘Not Dismissive’ Of EU Debt Conference SYRIZA Wants (Kathimirini)

SYRIZA leader Alexis Tsipras has seized on comments by Irish Finance Minister Michael Noonan as evidence that not just “progressive economists and the European Left” are coming round to his party’s argument that the European Union needs to hold a meeting to discuss how to reduce the debt of some of its members, including Greece. “In all of Europe, only Mr Samaras called this nonsene,” wrote Tsipras in Sunday’s Kathimerini. The Irish Times reported on Wednesday that Noonan told Irish ambassadors and civil servants he “would not be dismissive” of a European debt conference being held as long as the issue of Irish, Spanish and Portuguese debt could be discussed.

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“.. nobody believes the party’s over. That’s probably because most employees are older than 40 and have golden handshakes on a Midas scale.”

Aberdeen: In Scotland’s Oil Capital The Party’s Not Yet Over (Observer)

It has been a strange old week in the self-proclaimed oil capital of Europe. According to some members of Aberdeen’s energy sector, a group with a code of silence that would trump any Trappist throng, the North Sea is a busted flush, a dead zone of drilled-out fields with a long-term future to match. There will certainly be some transient pain in the industry; BP has confirmed 300 job losses and other subsidiaries will view the plummeting price of oil as a wonderful opportunity to trim any perceived excess fat. But if there is any panic in Aberdeen over the end of the gravy train, it is being well concealed. One executive told me on Friday: “Times are tough. And they might get tougher.” But nobody believes the party’s over. That’s probably because most employees are older than 40 and have golden handshakes on a Midas scale.

I walked along Aberdeen’s Union Street last week and one particular image struck me. It’s a once-glorious, now-dowdy thoroughfare with a few refulgent granite buildings surrounded by an excess of eyesores. On one side of the street, the Pound Shop announced that it was closing; on the other, the staff at the recently opened Eclectic Fizz champagne bar were preparing to welcome their steady stream of customers. At another location just outside the city on Thursday evening, a few hours after the BP news had broken, a group of four senior oil officials awaited their trip to the airport in Dyce. After a few minutes, four separate cabs arrived to pick them up: it didn’t matter the quartet were all travelling to the same destination. It may be a recession, Jim. But in Aberdeen, not as we usually know it.

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‘To make the impossible possible. To rise, and rise”

Buying A Home In Britain Should Not Be An Impossible Dream (Observer)

‘To make the impossible possible. To rise, and rise”. Uttered in a movie-trailer tone, it sounds like the mission statement for a Mars probe – but, set against the backdrop of the twinkling lights of night-time London, it’s actually the voiceover for a particularly obnoxious Redrow ad for flats in one of the capital’s now-ubiquitous glass and steel skyscrapers, launched and hastily withdrawn earlier this month after a furious outburst on social media. Its sharply suited, go-getting protagonist is whisked through the streets in a cab, reminiscing about all the hours he had to put in (“the mornings … that felt like night”); the calls from mates he was forced to ignore; and the terrible soul-searching he had to endure to succeed (apparently he felt the urge to “be more than individual”).

Without encountering another soul, our hero strides into an anonymous lobby and is whisked up to a vast, sparkling eyrie, worthy of a Bond villain’s hideout. An outraged viewer captured the ad for posterity; rival builder Berkeley Homes pulled its own equally nauseating effort (this one involving a private jet) a few days later. Prices for apartments at One Blackfriars, the tower block being marketed by Berkeley, range up to £23m. And judging by the ad, its lucky inhabitants in their hermetically sealed penthouses will never have to rub shoulders with hoi polloi down at ground level. It’s hard to think of a more powerful symbol of Britain’s divisive, winner-takes-all property market. Of course, the rich have always been with us, and to some extent have always cut themselves off. Strolling through the Geffrye Museum in east London recently, I was intrigued by a painting from 1936.

An elegant, bejewelled woman in a shimmering gown peers languorously out on to a crowded London thoroughfare, perhaps Regent Street or Piccadilly, from a plush, warmly lit salon, while a man faces away from the window with studied nonchalance, blowing smoke rings. Only on reading the inscription does it become clear that the lively scene outside the window is not a celebration or a festival, but the arrival of the Jarrow marchers. Britain in the 21st century is a very long way from the Great Depression; yet that well-heeled couple’s cosy imperviousness to their fellow humans’ suffering is all there in the “because I’m worth it” high-rise property porn churned out by Redrow, Berkeley and the rest (“They said nothing comes easy; but if it was easy, then it wouldn’t feel as good,” goes the voiceover).

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Yada yada.

Obama Speech To Call For Closing Tax Loopholes (Reuters)

– President Barack Obama’s State of the Union address will propose closing multibillion-dollar tax loopholes used by the wealthiest Americans, imposing a fee on big financial firms and then using the revenue to benefit the middle class, senior administration officials said on Saturday. Obama’s annual address to a joint session of Congress on Tuesday night will continue his theme of income equality, and the administration is optimistic it will find some bipartisan support in the Republican-dominated House of Representatives and Senate. The proposals administration officials listed on Saturday may still generate significant opposition from the Republicans because they would increase taxes.

In a conference call with reporters to preview the taxation aspect of Obama’s address, one official said some of the ideas the president is outlining already have “clear congressional bipartisan support or are ideas that are actually bipartisan in their nature.” Obama’s proposals call for reforming tax rules on trust funds, which the administration called “the single largest capital gains tax loophole” because it allows assets to be passed down untaxed to heirs of the richest Americans. They also would raise the capital gains and dividends rates to 28 percent, the level during the 1980s Republican presidency of Ronald Reagan. As a way of managing financial risk that could threaten the U.S. economy, Obama also wants to impose a fee of seven basis points on the liabilities of U.S. financial firms with assets of more than $50 billion, making it more costly for them to borrow heavily.

The changes on trust funds and capital gains, along with the fee on financial firms, would generate about $320 billion over 10 years, which would more than pay for benefits Obama wants to provide for the middle class, the official said. The benefits mentioned on Saturday would include a $500 credit for families with two working spouses, tripling the tax credit for child care to $3,000 per child, consolidating education tax incentives and making it easier for workers to save automatically for retirement if their employer does not offer a plan. The price tag on those benefits, plus a plan for free tuition at community colleges that Obama announced last week, would be about $235 billion, the official said. Specifics on the figures will be included in the budget Obama will send to Congress on Feb. 2. “We’re proposing more than enough to offset the new incremental costs of our proposals without increasing the deficit,” the administration official said.

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Greece has historically had close ties to Russia.

Russia May Lift Food Import Ban From Greece If It Quits EU (TASS)

Russia may lift its ban on food imports from Greece in the event it quits the European Union, Russian Minister of Agriculture Nikolai Fyodorov told a news conference in Berlin on Friday. Fyodorov is leading an official Russian delegation to the International Green Week public exhibition for the food, agriculture, and gardening industry. If Greece has to leave the European Union, we will build our own relations with it, the food ban will not be applicable to it, he said. He said that European Union countries, which felt discomfort from the slump in proceeds from exports of foods to Russia, were asking Russia to cushion the impacts of the Russian food import ban by expanding other types of imports.

We are looking at such possibility, he said, adding that these countries offer new formats of cooperation in those areas that are not covered by the Russian food sanctions. Meanwhile he stressed that Russia did not plan to toughen its sanctions. As concerns possible new sanctions, we are not looking at any such proposals from any structures, he added. Earlier on Friday, Fyodorov met with his German counterpart, Christian Schmidt, to discuss possible expansion of cooperation and mutual trade in agricultural products. The two ministers agreed that Russia and Germany may expand mutual trade in food products in the framework of the current laws.

“We cannot solve pressing political problems, but we can maintain dialogue in the current conditions, the German minister said. We can make trade between our countries more intensive. The Russian minister shared this opinion saying, the Berlin exhibitions was a non-political event working on problems of food security. We discussed possible expansion of cooperation and mutual trade in agricultural products and agreed to work in the new conditions strictly within the frameworks of the current legislation of Russia, the Customs Union, Germany and the European Union, Fyodorov said.

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This is effectively the US and EU killing women and children.

Donetsk Shelled As Kiev ‘Orders Massive Fire’ On East Ukraine (RT)

Violence escalated in eastern Ukraine as Kiev’s troops launched a massive assault on militia-held areas Sunday morning. The army was ordered to start massive shelling of all rebel positions, a presidential aide said. The order to launch the offensive was issued early approximately at 6:00 am, according to Yury Biryukov, an aide to President Petro Poroshenko. “Today we will show HOW good we are at jabbing in the teeth,” he wrote on his Facebook page, a mode of conveying information favored by many Ukrainian officials. In a later post he said: “They are now striking a dot. Uuu…” in a reference to Tochka-U (‘tochka’ means ‘dot’ in Russian), a tactical ballistic missile, one of the most powerful weapons Ukraine so far deployed against rebel forces. “That wasn’t a dot but ellipsis. Strong booms,” he added.

Reports from the ground confirmed a sharp escalation of clashes across the front line, with particularly heavy artillery fire reported at Gorlovka. “Locals in Donetsk said they haven’t heard such intensive shelling since summer,” Valentin Motuzenko, a military official in the self-proclaimed Donetsk People’s Republic, told Interfax news agency. “The Ukrainian military are using all kinds of weapons, Grad multiple rocket launchers, mortars…” Motuzenko said. Several residential buildings, a shop and a bus station have been seriously damaged by artillery fire in the city, RIA Novosti reported. There were also reports of attacks on the town of Makeevka and several nearby villages. The militia added that at least one shell hit a residential area in central Donetsk rather than the outskirts of the city. There were no immediate reports of how many casualties resulted from the offensive.

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“Canadian media theorist Marshall McLuhan foresaw these developments decades ago. In 1970, he wrote, “World War III is a guerrilla information war with no division between military and civilian participation.”

New Snowden Docs Reveal Scope Of NSA Preparations For Cyber War (Spiegel)

[..] the intelligence service isn’t just trying to achieve mass surveillance of Internet communication, either. The digital spies of the Five Eyes alliance – comprised of the United States, Britain, Canada, Australia and New Zealand – want more. According to top secret documents from the archive of NSA whistleblower Edward Snowden seen exclusively by SPIEGEL, they are planning for wars of the future in which the Internet will play a critical role, with the aim of being able to use the net to paralyze computer networks and, by doing so, potentially all the infrastructure they control, including power and water supplies, factories, airports or the flow of money. During the 20th century, scientists developed so-called ABC weapons – atomic, biological and chemical. It took decades before their deployment could be regulated and, at least partly, outlawed.

New digital weapons have now been developed for the war on the Internet. But there are almost no international conventions or supervisory authorities for these D weapons, and the only law that applies is the survival of the fittest. Canadian media theorist Marshall McLuhan foresaw these developments decades ago. In 1970, he wrote, “World War III is a guerrilla information war with no division between military and civilian participation.” That’s precisely the reality that spies are preparing for today. The US Army, Navy, Marines and Air Force have already established their own cyber forces, but it is the NSA, also officially a military agency, that is taking the lead. It’s no coincidence that the director of the NSA also serves as the head of the US Cyber Command. The country’s leading data spy, Admiral Michael Rogers, is also its chief cyber warrior and his close to 40,000 employees are responsible for both digital spying and destructive network attacks.

From a military perspective, surveillance of the Internet is merely “Phase 0” in the US digital war strategy. Internal NSA documents indicate that it is the prerequisite for everything that follows. They show that the aim of the surveillance is to detect vulnerabilities in enemy systems. Once “stealthy implants” have been placed to infiltrate enemy systems, thus allowing “permanent accesses,” then Phase Three has been achieved – a phase headed by the word “dominate” in the documents. This enables them to “control/destroy critical systems & networks at will through pre-positioned accesses (laid in Phase 0).” Critical infrastructure is considered by the agency to be anything that is important in keeping a society running: energy, communications and transportation. The internal documents state that the ultimate goal is “real time controlled escalation”.

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Chilling.

Guantánamo Diary Exposes Brutality Of US Rendition And Torture (Guardian)

The groundbreaking memoir of a current Guantánamo inmate that lays bare the harrowing details of the US rendition and torture programme from the perspective of one of its victims is to be published next week after a six-year battle for the manuscript to be declassified. Guantánamo Diary, the first book written by a still imprisoned detainee, is being published in 20 countries and has been serialised by the Guardian amid renewed calls by civil liberty campaigners for its author’s release. Mohamedou Ould Slahi describes a world tour of torture and humiliation that began in his native Mauritania more than 13 years ago and progressed through Jordan and Afghanistan before he was consigned to US detention in Guantánamo, Cuba, in August 2002 as prisoner number 760. US military officials told the Guardian this week that despite never being prosecuted and being cleared for release by a judge in 2010, he is unlikely to be released in the next year.

The journal, which Slahi handwrote in English, details how he was subjected to sleep deprivation, death threats, sexual humiliation and intimations that his torturers would go after his mother. After enduring this, he was subjected to “additional interrogation techniques” personally approved by the then US defence secretary, Donald Rumsfeld. He was blindfolded, forced to drink salt water, and then taken out to sea on a high-speed boat where he was beaten for three hours while immersed in ice. The end product of the torture, he writes, was lies. Slahi made a number of false confessions in an attempt to end the torment, telling interrogators he planned to blow up the CN Tower in Toronto. Asked if he was telling the truth, he replied: “I don’t care as long as you are pleased. So if you want to buy, I am selling.”

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“.. a massive flu outbreak could cost anywhere between $71 billion to $166.5 billion.”

Price Tag Of Saving The World From A Pandemic: $344 Billion (CNBC)

Infectious diseases are incubating everywhere across the world—ranging from the deadly Ebola virus to the more common yet debilitating influenza—to often devastating effect. It raises the question of how large a premium should world governments pay to insulate their economies from global pandemics. Would you believe $343.7 billion? That eye-popping figure is one of several takeaways of a group of scholars calling for a “global strategy” to mitigate the impact of threats to public health. In a recent paper published in the Proceedings of the National Academy of Sciences (PNAS) journal, economists and public health experts said emerging pandemics were increasing in their virulence and frequency.

The grim circumstances, which include the Ebola outbreak ravaging parts of Africa and an increasingly tough flu season in the U.S., calls for “globally coordinated strategies to combat” the hydra-headed threats posed by widespread disease—which the scientists say have their origins in animals. By pooling resources and implementing a host of programs and policies, governments could curtail the spread of infectious viruses by 50% if the measures were implemented within a 27-year span, the paper said. Of course, there’s the matter of the price tag, which is more than South Africa’s nominal GDP and is nearly as large as the U.S. Defense Department’s fiscal year 2015 budget. In response to questions, co-author Peter Daszak said the money would be funneled into “mitigation programs” that isolate the first cluster of cases at their source. The funds would also be spent on hospitals and diagnostic labs in West Africa, and creating a web of information to identify and track diseases. [..]

The study arrives at a time when public health officials are struggling to contain a blitz of mysterious outbreaks. In recent months, isolated cases of Ebola, Legionnnaire’s disease, enterovirus and Chikungunya—all sicknesses most common in developing economies—have all appeared in the U.S. In the larger scheme, the nearly $344 billion call to arms may be a reasonable price to pay to prevent yet another shock to global growth, one that’s already taking a heavy toll on African economies. In a December study, the World Bank said West Africa’s Ebola pandemic had shaved off about two-thirds of Liberia’s and Sierra Leone’s growth. For those who think the flu isn’t that pernicious, think again: A Centers for Disease Control study once estimated that a massive flu outbreak could cost anywhere between $71 billion to $166.5 billion.

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Absolute madness.

Is Lancashire Ready For Its Fracking Revolution? (Observer)

The Fylde, the flat, rich pasture land and villages stretching from Preston and the M6 to the Blackpool coast, is set to host the UK’s first full-scale fracking exploration, if Lancashire county council gives planning permission at the end of January. Nationally David Cameron and the government have declared they are “going all out” for fracking, hoping to emulate the shale gas revolution in the US. But on the frontline the mood is more equivocal. Fears of the effects on health and plummeting house prices compete with the promise of jobs and money for communities, accompanied by accusations of misinformation and hysteria from both sides.

The site owned by Sanderson’s uncle and aunt is near Roseacre, and as you wind down the pot-holed lanes towards it, past the huge communication masts of the Royal Navy’s Inskip site, placards of opposition appear: “Don’t frack with Fylde”, “Health not wealth” and “What price fracking? Clean air? Clean water?” At the site, an unspectacular stretch of grassland whose only current features are a black water butt and a dull rumble from the M55, Cuadrilla’s head of well development, Eric Vaughan, explains the company’s plans for up to four wells, each of which would see dozens of fracking blasts to release gas. “I am excited we may finally get going again,” he says. “You have to be optimistic. We have tried to answer every question. Hopefully the planning permission will go through, so we can show people what it really looks like.”

A single frack at Cuadrilla’s Preese Hall site on the Fylde in 2011 produced good flow results, says Vaughan, but it also produced two small earthquakes, a government investigation and a false start for the company. “Because we had the earthquake, we decided to abandon that well,” says Vaughan, who is originally from Kentucky and for the past 30 years has been fracking all over the world, from the US to Thailand to Turkmenistan. Fracking at Roseacre, and at a second proposed site at nearby Preston New Road, will be under way by Christmas, if all goes Cuadrilla’s way. On Friday, the Environment Agency granted the environmental permits Cuadrilla needs for Preston New Road, and has already said it is minded to grant the permits for Roseacre as well.

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So true.

Pope Francis: Listen To Women, Men Are Too Machista (RT)

Pope Francis has called on men to listen to women as they have “much to tell us.” Women are able to ask questions that men can’t grasp, the pontiff told an audience in the Philippines, where his comments drew instant applause. “Women have much to tell us in today’s society,” Francis told a mostly male audience at the Catholic University of Santo Tomas in Manila, on the last day of a weeklong visit to Philippines and Sri Lanka. His impromptu comments were welcomed with applause from the audience, which according to organizers’ estimates was 30,000 people. “At times we men are too ‘machista’, the Argentinian pontiff said using word for the term for extreme male chauvinism in his native Spanish. According to the 78-year-old Catholic leader, we “don’t allow room for women but women are capable of seeing things with a different angle from us, with a different eye.”

His comments come after he noted that four out of five people who asked him questions on the stage were male. “There is only a small representation of females here, too little,” he said, to laughter. He added that it was a 12-year-old girl who posed the toughest question to him. Glyzelle Palomar, who was living on the streets before being taken in by a church charity, broke into tears when she was posing her question. “Many children are abandoned by their parents. Many children get involved in drugs and prostitution. Why does God allow these things to happen to us? The children are not guilty of anything,” Palomar said. Francis took her into his arms and hugged her for a few seconds. “She is the only one who has put a question for which there is no answer and she wasn’t even able to express it in words, but in tears,” he said.

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Dec 192014
 
 December 19, 2014  Posted by at 11:21 am Finance Tagged with: , , , , , , , ,  


John Vachon Trucks loaded with mattresses at San Angelo, Texas Nov 1939

Oil Crash Exposes New Risks for U.S. Shale Drillers (Bloomberg)
North Sea Oil Industry ‘Close To Collapse’ (BBC)
North Sea Oilfields ‘Near Collapse’ After Price Nosedive (Telegraph)
Exxon Mobil Shows Why U.S. Oil Output Rises as Prices Plunge (Bloomberg)
Central Banks Are Now Uncorking The Delirium Phase (David Stockman)
Dow’s 421-Point Leap Is Biggest Gain In 3 Years (MarketWatch)
Already Crummy US Economy Takes a Sudden Hit (WolfStreet)
The Fed Delivers the Message that Our Economy is Dead (Beversdorf)
Emerging Markets In Danger (Erico Matias Tavares)
China’s Short-Term Borrowing Costs Surge as Demand for Money Grows (WSJ)
PBOC Offers Loans to Banks as Money Rate Jumps Most in 11 Months (Bloomberg)
Russia May Seek China Help To Deal With Crisis (SCMP)
Draghi Counts Cost of Outflanking Germany in Stimulus Battle (Bloomberg)
Federal Reserve Delays Parts Of Volcker Rule Until 2017 (BBC)
“Neoconica” – America For The New Millennium (Thad Beversdorf)
Bombs Away! Obama Signs Bill For Lethal Aid To Ukraine (Daniel McAdams)
US TV Shows American Torturers, But Not Their Victims (Glenn Greenwald)
Pope Francis Scores on Diplomatic Stage With U.S.-Cuba Agreement (Bloomberg)
Can You Live A Normal Life With Half A Brain? (BBC)

“It’s just the nature of the business. You’re not going to go drill holes in the ground if you think prices are going down.”

Oil Crash Exposes New Risks for U.S. Shale Drillers (Bloomberg)

Tumbling oil prices have exposed a weakness in the insurance that some U.S. shale drillers bought to protect themselves against a crash. At least six companies, including Pioneer Natural Resources and Noble Energy, used a strategy known as a three-way collar that doesn’t guarantee a minimum price if crude falls below a certain level, according to company filings. While three-ways can be cheaper than other hedges, they can leave drillers exposed to steep declines. “Producers are inherently bullish,” said Mike Corley, the founder of Mercatus Energy Advisors, a Houston-based firm that advises companies on hedging strategies. “It’s just the nature of the business. You’re not going to go drill holes in the ground if you think prices are going down.”

The three-way hedges risk exacerbating a cash squeeze for companies trying to cope with the biggest plunge in oil prices this decade. West Texas Intermediate crude, the U.S. benchmark, dropped 50% since June amid a worldwide glut. The Organization of Petroleum Exporting Countries decided Nov. 27 to hold production steady as the 12-member group competes for market share against U.S. shale drillers that have pushed domestic output to the highest since at least 1983. Shares of oil companies are also dropping, with a 49% decline in the 76-member Bloomberg Intelligence North America E&P Valuation Peers index from this year’s peak in June. The drilling had been driven by high oil prices and low-cost financing. Companies spent $1.30 for every dollar earned selling oil and gas in the third quarter, according to data compiled by Bloomberg on 56 of the U.S.-listed companies in the E&P index.

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450,000 people work in Britain’s oil industry.

North Sea Oil Industry ‘Close To Collapse’ (BBC)

The UK’s oil industry is in “crisis” as prices drop, a senior industry leader has told the BBC. Oil companies and service providers are cutting staff and investment to save money. Robin Allan, chairman of the independent explorers’ association Brindex, told the BBC that the industry was “close to collapse”. Almost no new projects in the North Sea are profitable with oil below $60 a barrel, he claims. “It’s almost impossible to make money at these oil prices”, Mr Allan, who is a director of Premier Oil in addition to chairing Brindex, told the BBC. “It’s a huge crisis.” “This has happened before, and the industry adapts, but the adaptation is one of slashing people, slashing projects and reducing costs wherever possible, and that’s painful for our staff, painful for companies and painful for the country. “It’s close to collapse. In terms of new investments – there will be none, everyone is retreating, people are being laid off at most companies this week and in the coming weeks. Budgets for 2015 are being cut by everyone.”

Mr Allan said many of the job cuts across the industry would not have been publicly announced. Oil workers are often employed as contractors, which are easier for employers to cut. His remarks echo comments made by the veteran oil man and government adviser Sir Ian Wood, who last week predicted a wave of job losses in the North Sea over the next 18 months. The US-based oil giant ConocoPhillips is cutting 230 out of 1,650 jobs in the UK. This month it announced a 20% reduction in its worldwide capital expenditure budget, in response to falling oil prices. Other big oil firms are expected to make similar cuts to their drilling and exploration budgets. Research from the investment bank Goldman Sachs predicted that they would need to cut capital expenditure by 30% to restore their profitability at current prices. Service providers to the industry have also been hit. Texas-based oilfield services company Schlumberger cut back its UK-based fleet of geological survey ships in December, taking an $800m loss and cutting an unspecified number of jobs.

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“The prolongation of the downward trend of the oil price in world markets is a political conspiracy going to extremes.”

North Sea Oilfields ‘Near Collapse’ After Price Nosedive (Telegraph)

The North Sea oil industry is “close to collapse”, an expert has warned, as a slump in prices piles pressure on drillers to cut back investing in the region. Robin Allan, chairman of the independent explorers’ association Brindex, told the BBC that it is “almost impossible to make money” with the oil price below $60 per barrel. “It’s a huge crisis. This has happened before, and the industry adapts, but the adaptation is one of slashing people, slashing projects and reducing costs,” he said. Mr Allan’s glum outlook for oil production and exploration in the UK Continental Shelf came on a volatile day of trading for crude. Brent – a global pricing benchmark comprising crude from 15 North Sea fields – ended trading in London down 1% at around $60 per barrel after trading up by as much as 3% earlier in the session. Mr Allan’s warning comes after The Telegraph reported that £55bn worth of oil projects in the North Sea and Europe could be cancelled due to the current slide in prices, according to consultancy Wood Mackenzie.

Concern over the ability of the North Sea to endure the current downturn has increased since OPEC decided to keep pumping at its current rate of 30m barrels per day (bpd) in late November. Opec kingpins Saudi Arabia and Iran were at odds on Thursday over the reason behind falling prices in an indication of the pain being caused to many of the cartel’s 12 members. Iran’s oil minister has said that a “political conspiracy” is to blame for the dramatic slump in remarks which could signal that the Islamic Republic will try to exert pressure on Opec to again consider cutting output. Bijan Zanganeh told the country’s state petroleum news agency: “The prolongation of the downward trend of the oil price in world markets is a political conspiracy going to extremes.”

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“Companies that are already producing oil will continue to operate those wells because the cost of drilling them is already sunk into the ground ..”

Exxon Mobil Shows Why U.S. Oil Output Rises as Prices Plunge (Bloomberg)

Crude oil production from U.S. wells is poised to approach a 42-year record next year as drillers ignore the recent decline in price pointing them in the opposite direction. U.S. energy producers plan to pump more crude in 2015 as declining equipment costs and enhanced drilling techniques more than offset the collapse in oil markets, said Troy Eckard, whose Eckard Global owns stakes in more than 260 North Dakota shale wells. Oil companies, while trimming 2015 budgets to cope with the lowest crude prices in five years, are also shifting their focus to their most-prolific, lowest-cost fields, which means extracting more oil with fewer drilling rigs, said Goldman Sachs. Global giant Exxon Mobil, the largest U.S. energy company, will increase oil production next year by the biggest margin since 2010.

So far, OPEC’s month-old bet that American drillers would be crushed by cratering prices has been a bust. “Companies that are already producing oil will continue to operate those wells because the cost of drilling them is already sunk into the ground,” said Timothy Rudderow, who manages $1.5 billion as chief investment officer at Mount Lucas Management. “But I wouldn’t want to have to be making long-term production decisions with this kind of volatility.” A U.S. crude bonanza that has handed consumers the cheapest gasoline since 2009 has left oil exporters like Russia and Venezuela flirting with economic chaos. The ruble sank as much as 19% on Dec. 16 to a record low of 80 per dollar before recovering to close at 68; Russian bond and equity markets also crumbled.

In Venezuela, the oil rout is spurring concern the country is running out of dollars needed to pay debt and swaps traders are almost certain default is imminent. U.S. oil production is set to reach 9.42 million barrels a day in May, which would be the highest monthly average since November 1972, according to the Energy Department’s statistical arm. Output from shale formations, deep-water fields, the Alaskan wilderness and land-based wells in pockets of Oklahoma and Pennsylvania that have been trickling out crude for decades already have pushed demand for imported oil to the lowest since at least 1995, according to data compiled by Bloomberg.

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“The essence of its action was that your money is not welcome in Switzerland ..”

Central Banks Are Now Uncorking The Delirium Phase (David Stockman)

Virtually every day there is an eruption of lunacy from one central bank or another somewhere in the world. Today it was the Swiss central bank’s turn, and it didn’t pull any punches with regard to Russian billionaires seeking a safe haven from the ruble-rubble in Moscow or investors from all around its borders fleeing Mario Draghi’s impending euro-trashing campaign. The essence of its action was that your money is not welcome in Switzerland; and if you do bring it, we will extract a rental payment from your deposits. For the time being, that levy amounts to a negative 25 bps on deposits with the Swiss Central bank – a maneuver that is designed to drive Swiss Libor into the realm of negative interest rates as well. But the more significant implication is that the Swiss are prepared to print endless amounts of their own currency to enforce this utterly unnatural edict on savers and depositors within its borders.

Yes, the once and former pillar of monetary rectitude, the SNB, has gone all-in for money printing. Indeed, it now aims to become the BOJ on steroids – a monetary Godzilla. So its current plunge into the netherworld of negative interest rates is nothing new. It’s just the next step in its long-standing campaign to put a floor under the Swiss Franc at 120. That means effectively that it stands ready to print enough francs to purchase any and all euros (and other currencies) on offer without limit. And print it has. During the last 80 months, the SNB’s balance sheet has soared from 100B CHF to 530B CHF – a 5X explosion that would make Bernanke envious. Better still, a balance sheet which stood at 20% of Swiss GDP in early 2008 – now towers at a world record 80% of the alpine nation’s total output. Kuroda-san, with a balance sheet at 50% of Japan’s GDP, can only pine for the efficiency of the SNB’s printing presses.

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Are they all going to sell in January?

Dow’s 421-Point Leap Is Biggest Gain In 3 Years (MarketWatch)

A surging U.S. stock market rallied to its best two-day gains in three years Thursday. The monster rally, which kicked off Wednesday after Federal Reserve Chairwoman Janet Yellen assured the markets that the central bank would be patient about lifting interest rate, burst into an all-out bull run late in Thursday trading. The move caps a two-day charge higher, bringing the Dow back to within shouting distance of 18,0000, after rocky trading days. The Dow Jones Industrial Average soared 421 points, or 2.4%, to 17,778.15, its biggest one-day gain in three years, a day after the Federal Reserve said it “can be patient” about the timing of its first rate hike, signalling increases will be slow and steady. It was the first time in more than six years since the Dow recorded back-to-back days of gains exceeding 200 points.

The S&P 500 jumped 48.34 points, or 2.4%, to 2,061.23, it’s biggest one-day gain in nearly two years. It is also the first time since Aug 2002 that the benchmark index posted two consecutive days of gains greater than 2%, according to Howard Silverblatt, senior index analyst at S&P Dow Jones Indices. The Nasdaq Composite jumped 104 points, or 2.2%, to 4,748, as technology companies recorded big gains. Jonathan Golub, chief U.S. market strategist at RBC Capital Markets, attributed today’s rally to halo effect from the Fed’s announcement on Wednesday. “The Fed told equity investors what we already assumed and believed,” Golub said. “There was fear that if there was going to be any change in the stance, it would be towards hawkishness, but the statement dispelled that, so stock markets rallied,” the RBC strategist added.

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Can we have some polar vortex please?

Already Crummy US Economy Takes a Sudden Hit (WolfStreet)

The Fed yesterday, in a fit of its typical though inexplicable optimism, raised its projection for economic growth. In September, it had projected that the US economy would grow between 2.0% and 2.2% in 2014. Now it raised its “central tendency” to a growth of 2.3% to 2.4%. That type of measly economic growth is far below the ever elusive escape velocity that Wall Street keeps promising without fail every year to justify sky-high stock valuations. But now reality is once again mucking up our already not very rosy scenarios. The service sector, the dominant force in the US economy, has taken another hit. Markit’s Services PMI Business Activity index slumped in December to 53.6, down from 56.2 in November. It’s now nearly 3 percentage points below the average over the last two years (56.4). And it is barely above the terrible growth rate in February (53.3), for which the polar vortex that had covered much of the nation was amply blamed.

Here is a chart of the shrinking services PMI. The peak was in June. From that point of maximum exuberance, it has been one heck of a downhill ride. Note the sudden no-polar-vortex plunge from November to December.

This time, there were no polar vortices to blame. But there were plenty of business reasons. Incoming new work was the lowest in nine months, with some survey respondents indicating that “the economic outlook had weighted on client demand at the end of the year.” The rate of job creation dropped to the lowest since April, with some respondents citing softer new business as reason. The Composite PMI, which combines the Services PMI and the Manufacturing PMI, dropped sharply from 56.1 in November to 53.8 in December. It has been on the same trajectory as the Services PMI, with the peak in June, followed by a downhill ride that culminated in a sudden plunge in December that left it below February’s polar-vortex low!

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“.. if you read some of Stanley Fischer’s early work on the rational expectation model you find that the key to fixing the lack of long term effectiveness to monetary policy is by confusing the working man. The idea being, people will act rationally with the information they are provided and so what typically happens is that people change their behaviour which counters the impact of the policy being implemented.

The Fed Delivers the Message that Our Economy is Dead (Beversdorf)

I used to get a kick out of the cute little children waiting for the Fed Chair to come and deliver presents or coal. So giddy and excited from the anticipation of not knowing who Janet thinks were good boys and girls. Who’s going to be rewarded and who disappointed? And I don’t know how many people asked me today what the Fed will do. My answer was “The same [email protected]#*ing thing they always do, nothing. So stop asking”. You see, if you read some of Stanley Fischer’s early work on the rational expectation model you find that the key to fixing the lack of long term effectiveness to monetary policy is by confusing the working man. The idea being, people will act rationally with the information they are provided and so what typically happens is that people change their behaviour which counters the impact of the policy being implemented.

The solution is to keep us guessing. And so what they have done for essentially every meeting is nothing. However, they use the media to talk about all the things they just might do. And the pundits on television go on and on about all the things that might happen and what the follow on implications will be given those alternatives and then the moment comes and ahhh nothing, damn they fooled me again! I really thought this time was it gosh golly dang it!. I guess it was just that this or that was just slightly out of place otherwise they said they were totally gonna do this or that. So close, but ultimately they are right. Yep they made the right choice based on all the variables. They are just swell. At this point, I just get annoyed with the ridiculous foolishness of people. We’ve got to start using our own brains. The Fed stopped using any benchmarks because while the benchmarks were improving, the economy wasn’t and isn’t.

And so they were being railroaded by the transparency that benchmarks provide. And now it is just a black box of various indicators that will be analyzed in real time to form justifiable actions, far too complex for you and I but trust them that there is a definite method and it’s very quantifiable at that, they just can’t tell us what it is because it would just confuse everyone. Does anyone really not get it?? I mean I was under the impression that the pundits on television were just acting for the sake of good drama. Is that not the case? Are people really still confused by what’s happening in the market and broader economy? It’s been 6 years of the absolute same bullshit. How could anyone not clearly understand exactly what is behind the action or non action of the Fed??? Come on people wake up. Take a deep breath, grab some coffee, do whatever you need to do but please wake the hell up.

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They’re all addicted to Fed QE. But that’s gone, and there’s no alternative available.

Emerging Markets In Danger (Erico Matias Tavares)

There are some signs of trouble in emerging markets. And the money at risk now is bigger than ever. The yield spread between high grade emerging markets and US AAA-rated corporate debt has jumped, almost doubling in less than three weeks to the highest level since mid-2012.


MSCI Emerging Markets Index and Yield Spread between High Grade Emerging Markets and US AAA Corporates: 14 March 2003 – Today. Source: US Federal Reserve.

This means that the best credit names in emerging markets have to pay a bigger premium over their US counterparts to get funding. When this spread spikes up and continues above its 200-day moving average for a sustained period of time, it is typically a bad sign for equity valuations in emerging markets, as shown in the graph above. One swallow does not a summer make, but it is worthwhile keeping an eye on this indicator.

As yields go up the value of these emerging market bonds goes down, resulting in losses for the investors holding them. The surge of the US dollar in recent months could magnify these losses: if the bonds are denominated in local currency they will be worth a lot less to US investors; otherwise, the borrowers will now have to work a lot harder to repay those US dollar debts, increasing their credit risk. Any losses could end up being very significant this time around, as demand for emerging markets bonds has literally exploded in recent years.


Average Annual Gross Debt Issuance ($ billions, percent): 2000 – Today. Source: Dealogic, US Treasury. Note: Data include private placements and publicly-issued bonds. 2014 data are through August 2014 and annualized.

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The craze in China stocks makes money scarce…

China’s Short-Term Borrowing Costs Surge as Demand for Money Grows (WSJ)

Short-term borrowing costs in China soared Thursday as demand for cash surged due to a number of new stock offerings and the year-end shopping spree. A recent ruling that bans the use of lower-grade corporate bonds as collateral for loans, once a key source of funding for many institutional investors, has also intensified the scramble for funds. The cash squeeze is putting the country’s financial system under renewed stress, though so far it hasn’t spread to other sectors such as stocks or the bond markets. The money markets in China have grown dramatically in recent years, with smaller banks especially vulnerable to the higher borrowing costs as they’re most reliant on the interbank market for cash.

The weighted average of seven-day repurchase agreements, or repo, a benchmark for short-term funding costs in China’s money market, rose to 5.27% from 3.89% Wednesday and 3.53% at the beginning of this week. However, the level remains well below the 12% peak that it touched at the height of the unprecedented cash crunch that China suffered in the summer of 2013. “The u%oming IPOs is the most important reason behind today’s funding squeeze. The usual year-end thirst for cash also is also playing a part,” said Wang Ming, a partner at Shanghai Yaozhi Asset Management Co. A dozen companies, including broker Guosen Securities and budget carrier Spring Airlines, are raising a total of $2.2 billion over the next few weeks from domestic stock listings. They are set to take orders for their offerings between Dec. 18 and Dec. 23.

Investors’ enthusiasm about the new IPOs was even more evident in the smaller funding market on the Shanghai Stock Exchange, the bigger of China’s two exchanges. The weighted average of the seven-day repo on the Shanghai market, where investors use exchange-listed bonds as collateral for short-term borrowing, soared to 12.20% from 10.60% Wednesday. It stood at 6.80% Monday. Such one-off factors aside, the recent strong rally in China’s stock market and a fresh move by Beijing to rein in growing risk in the corporate bond market are having a more lasting impact on the supply of funds, Mr. Wang said. China’s securities clearing house last week banned the use of lower-grade bonds, mostly issued by cash-strapped local governments and small firms, as collateral for short-term borrowing between investors.

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And banks feel the pinch.

PBOC Offers Loans to Banks as Money Rate Jumps Most in 11 Months (Bloomberg)

China’s central bank offered short-term loans to commercial lenders as the benchmark money-market rate jumped the most in 11 months. The amount of money made available by the People’s Bank of China wasn’t clear, according to people familiar with the matter. Policy makers are adding funds to the financial system to address a cash crunch as subscriptions for the biggest new share sales of the year lock up funds. Twelve initial public offerings from today through Dec. 25 will draw orders of as much as 3 trillion yuan ($483 billion), Shenyin & Wanguo Securities Co. estimated. The seven-day repurchase rate, a gauge of interbank funding availability in the banking system, surged 139 basis points, or 1.39%age points, to a 10-month high of 5.28% as of 4:39 p.m. in Shanghai, according to a weighted average compiled by the National Interbank Funding Center. The increase was the biggest since Jan. 20.

“The IPOs are affecting the market, leading to cautious sentiment with fewer institutions willing to lend,” said Li Haitao, a Shanghai-based analyst at China Guangfa Bank Co. “Quite a few traders found it very difficult to meet their funding needs yesterday.” Lenders paid 4.65% for 60 billion yuan of three-month treasury deposits auctioned today by the PBOC, the most they’ve paid since January for such funds. The central bank also rolled over this week at least some of the 500 billion yuan of three-month loans granted to lenders in September, a government official said yesterday, declining to be identified as the details haven’t been made public. “Banks have to prepare for quarter-end regulatory checks, including loan-to-deposit requirements, and hoard cash to meet year-end demand,” said Wang Ming, chief operations officer at Shanghai Yaozhi Asset Management LLP, which oversees 2 billion yuan of fixed-income investments. “With all these factors affecting the market, it’s no surprise it’s suffering more than during previous IPOs.”

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Eastern links will get much stronger as a result of western policies vs Russia.

Russia May Seek China Help To Deal With Crisis (SCMP)

Russia could fall back on its 150 billion yuan (HK$189.8 billion) currency swap agreement with China if the rouble continues to plunge. If the swap deal is activated for this purpose, it would mark the first time China is called upon to use its currency to bail out another currency in crisis. The deal was signed by the two central banks in October, when Premier Li Keqiang visited Russia. “Russia badly needs liquidity support and the swap line could be an ideal tool,” said Bank of Communications chief economist Lian Ping. The swap allows the central banks to directly buy yuan and rouble in the two currencies, rather than via the US dollar. Two bankers close to the People’s Bank of China said it was meant to reduce the role of the US dollar if China and Russia need to help each other overcome a liquidity squeeze.

China has currency swap deals with more than 20 monetary authorities around the world. Swaps are generally used to settle trade. “The yuan-rouble swap deal was not just a financial matter,” said Wang Feng, chairman of Shanghai-based private equity group Yinshu Capital. “It has political implications as it is a sign of mutual trust.” The rouble has lost more than 50% against the US dollar this year, pushing Russia to the brink of a currency crisis, though measures announced by the central bank helped it recover some ground yesterday. Li Lifan, a researcher at the Shanghai Academy of Social Sciences, said the swap would not be enough for Russia even if it is used in its entirety. “The PBOC might agree to extend something like 15 billion yuan initially as a way of showing China’s commitment to Russia.”

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How to blow up the EU.

Draghi Counts Cost of Outflanking Germany in Stimulus Battle (Bloomberg)

As Mario Draghi prepares to push the European Central Bank into quantitative easing, he’s counting the cost of alienating its home nation. With the ECB president signaling that he’ll override German-led concerns on government bond purchases if needed, his institution is under attack in the country whose DNA inspired it. The outrage reflects concern that the Frankfurt-based central bank, which is modeled on the Bundesbank, is taking risks that its forerunner would never tolerate. The Italian is now pursuing a charm offensive in the euro area’s biggest and most populous economy before the Governing Council’s Jan. 22 meeting to soften the blow as he presses on with stimulus. His challenge is to outflank the Bundesbank without risking a spillover into national politics serious enough to threaten German support for the single currency.

“The ECB has built up enough credibility on its own,” said Holger Schmieding, chief economist at Berenberg Bank in London. “That the Bundesbank may object to sovereign-bond purchases is largely taken for granted by markets. Tacit support from Berlin would neutralize Bundesbank objections in the German public debate.” The momentum toward QE is building, with more than 90% of economists in Bloomberg’s monthly survey predicting it’ll start in 2015. Euro-area inflation was 0.3% in November, compared with the ECB’s goal of just under 2%, and is poised to turn negative because of a slump in oil prices.

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“The rule prevents federally-insured banks from using their own money when investing in certain risky assets.”

Federal Reserve Delays Parts Of Volcker Rule Until 2017 (BBC)

The US Federal Reserve has given Wall Street banks even more time to comply with parts of the Volcker Rule, a key provision of the 2010 Dodd-Frank financial reform bill. The rule prevents federally-insured banks from using their own money when investing in certain risky assets. The Fed had already announced banks would have until 2017 to deal with one type of trading product. It will now grant an extension to other types of funds. Initially, the Fed had said banks would have until 21 July 2017 to stop trading in collateralised loan obligations, which essentially move the risk of investments in loans off their balance sheet. The new extension applies to other types of “legacy covered funds”, according to a release on the Fed’s website, which include “having certain relationships with a hedge fund or private equity fund”.

The Volcker rule is named after former Federal Reserve chair Paul Volcker and it limits the ownership stake banks can have in risky funds to a maximum of 3%. Part of the rule, which bans proprietary trading, is still scheduled to go into effect on 1 July 2015. This is the second big victory for banks, who have spent nearly four years arguing that the regulations stipulated in the 1,600-page Dodd-Frank bill are too onerous. Last week, a coalition of big banks, led by Citigroup, succeeding in convincing Congress to repeal a provision that required banks to put their riskier investments into separate holding companies that would not be insured by the US government.

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An exhaustive overview, with tons of graphs, of all aspects of the true state of the union, from obesity to poverty to incarceration rates. Don’t miss it.

“Neoconica” – America For The New Millennium (Thad Beversdorf)

I recently wrote an piece on the comprehensive breakdown of America. In it I laid out, from an analytical perspective, the things that are leading America to an economic collapse. But it might be interesting to take a look at a broader view of American life today. Policy and economic discussions are useful but in them we can lose the tangibility of what it all comes back to, which is the well being of Americans. Whether or not the national budget is 190% of GDP and whether interest rates will rise or not are important issues but only so far as they will impact the quality of life of the people. And so let s have a look at the lives of the American people. Have the policies over the past 15 to 50 years led to substantial improvements in the day to day real lives of Americans? Let’s have a look. And while we ve seen a couple of these more economic charts think about them in context of the other charts or other sides of life.

The above charts inform us that the bottom 80% of income households are making less than they did in the early 1980s, and remember the number of two income households today is far greater than it was in 1980 making this a staggering reality. However the top 20% and especially the top 1% have seen incredible income gains since the early 1980s. Total net worth for the bottom 80% of Americans has also been crushed. Since 2001 median net worth for the bottom 80% is down some 30% and this is during a period where stocks have reached all time highs. How could this be you ask?? Well this is not happenstance or simple unexplainable market forces. Those things do not exist in today s world. These results are by design.

I get frustrated hearing, even from the most intelligent of people that the Fed is doing its best and that given enough time this will work out for everyone. And that everyone is better off today than they used to be because this is America and that s just the way America works. But when we let the empirical data drive our perspective rather than our blind loyalty we see a very different story. The data tells a story of a political class that has been implementing programs and policies that are making the working class sick. We are given all sorts of medicines in the form of social programs and infinite debt to mask the symptoms but when we look at the actual medical test results we are not getting any better. In fact, our condition continues to worsen. Yet so many of us continue to listen to our political and economic shamans. We have such faith. And it is that faith that people like Ayn Rand recognized would be the death of America. So let’s continue on our journey through the life of the working class American today.

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“The solution for these three Members was to ensure that no other Members were present. It would have been difficult for other Members to object anyway, as no one else in the House had even seen the bill!”

Bombs Away! Obama Signs Bill For Lethal Aid To Ukraine (Daniel McAdams)

President Obama made good today on his promise to sign the Ukraine Freedom Support Act of 2014, which had passed Congress last week. Dubbed by former Rep. Dennis Kucinich the bill that “reignited the Cold War while no one was looking,” the Act imposes new sanctions on the Russian defense and energy industries, authorizes $350 million in lethal military assistance to the US-backed government in Kiev, urges that government to resume its deadly military operations against the Russian-speaking areas of east Ukraine seeking to break away from Kiev’s rule, and authorizes millions of dollars to fund increased US government propaganda broadcasts to the countries of the former Soviet Union.

Just days before Christmas, this bill is a massive gift to the US defense industry from which Ukraine will be required to purchase its lethal wish list. Perhaps as disturbing as the bill itself is the shocking process by which it passed the US House of Representatives. Three Members of the House, Foreign Affairs Committee Chairman Ed Royce (R-CA), Eliot Engel (D-NY), and Marcy Kaptur (D-OH), planned to be on the House Floor after the business of the day (passage of the massive omnibus spending bill) was completed and Members had left the Floor. Under a parliamentary move called “unanimous consent” the normal rules of the House can be suspended provided not a single other Member objects. The solution for these three Members was to ensure that no other Members were present. It would have been difficult for other Members to object anyway, as no one else in the House had even seen the bill!

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“Even in the worst of times, ‘we are always Americans, and different, stronger, and better than those who would destroy us.’”

US TV Shows American Torturers, But Not Their Victims (Glenn Greenwald)

Ever since the torture report was released last week, U.S. television outlets have endlessly featured American torturers and torture proponents. But there was one group that was almost never heard from: the victims of their torture, not even the ones recognized by the U.S. Government itself as innocent, not even the family members of the ones they tortured to death. Whether by design (most likely) or effect, this inexcusable omission radically distorts coverage. Whenever America is forced to confront its heinous acts, the central strategy is to disappear the victims, render them invisible. That’s what robs them of their humanity: it’s the process of dehumanization.

That, in turn, is what enables American elites first to support atrocities, and then, when forced to reckon with them, tell themselves that – despite some isolated and well-intentioned bad acts – they are still really good, elevated, noble, admirable people. It’s hardly surprising, then, that a Washington Post/ABC News poll released this morning found that a large majority of Americans believe torture is justified even when you call it “torture.” Not having to think about actual human victims makes it easy to justify any sort of crime. That’s the process by which the reliably repellent Tom Friedman seized on the torture report to celebrate America’s unique greatness.

“We are a beacon of opportunity and freedom, and also [..] these foreigners know in their bones that we do things differently from other big powers in history,” the beloved-by-DC columnist wrote after reading about forced rectal feeding and freezing detainees to death. For the opinion-making class, even America’s savage torture is proof of its superiority and inherent Goodness: “this act of self-examination is not only what keeps our society as a whole healthy, it’s what keeps us a model that others want to emulate, partner with and immigrate to.” Friedman, who himself unleashed one of the most (literally) psychotic defenses of the Iraq War, ended his torture discussion by approvingly quoting John McCain on America’s enduring moral superiority: “Even in the worst of times, ‘we are always Americans, and different, stronger, and better than those who would destroy us.’”

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“The Vatican is historically a place of politics and not just religion and has been for hundreds of years, with many popes starting their careers as diplomats for the Holy See ..”

Pope Francis Scores on Diplomatic Stage With U.S.-Cuba Agreement (Bloomberg)

After misfires in the Middle East and South Korea, Pope Francis is finding his place on the stage of world diplomacy — by taking the initiative. The pontiff who has made his name mostly by opening up debate in the Catholic Church about divorce and homosexuality yesterday achieved his first geopolitical success: The Argentine-born pope played a key role in brokering the accord between the U.S. and Cuba to move toward normal relations. After Pope Francis and President Barack Obama discussed Cuba during a Vatican meeting in March, the pontiff wrote directly to Obama and Cuban President Raul Castro urging them to conclude a prisoner exchange, according to an Obama administration official. It was the first such letter the president had received from the pope, the official said.

“The role of Pope Francis has been decisive,” said Vatican Secretary of State Pietro Parolin on Vatican Radio today. “He was the one who took the initiative of writing to the two presidents to invite them to overcome the problems between the two countries and find an agreement.” Francis, 78, had greater success with Cuba than in his other political ventures because it was an obsolescent standoff waiting for a solution and because of his Latin American roots, said Philippe Moreau-Defarges, a researcher at the French Institute of International Relations in Paris. “The Cuba situation simply made no sense to anyone anymore,” said Moreau-Defarges.

While the Vatican diplomatic corps exchanges representatives with 179 countries and popes have been sending emissaries since the 4th century, modern-day pontiffs haven’t always been politically involved. Benedict XVI, Francis’ German predecessor, focused more on doctrinal issues. His predecessor, John Paul II, pope from 1978 to 2005, spoke out frequently against military force and dictatorship and is credited with hastening the collapse of communism in his native Poland. “The Vatican is historically a place of politics and not just religion and has been for hundreds of years, with many popes starting their careers as diplomats for the Holy See,” said Federico Niglia, a history professor at Luiss University in Rome. “What’s somewhat unusual is Francis acting in person beyond diplomatic circles, which has close parallels to the style of predecessor John Paul II.”

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Brain structures are fascinating, with built-in resilience, redundancy.

Can You Live A Normal Life With Half A Brain? (BBC)

How much of our brain do we actually need? A number of stories have appeared in the news in recent months about people with chunks of their brains missing or damaged. These cases tell a story about the mind that goes deeper than their initial shock factor. It isn’t just that we don’t understand how the brain works, but that we may be thinking about it in the entirely wrong way. Earlier this year, a case was reported of a woman who is missing her cerebellum, a distinct structure found at the back of the brain. By some estimates the human cerebellum contains half the brain cells you have. This isn’t just brain damage – the whole structure is absent. Yet this woman lives a normal life; she graduated from school, got married and had a kid following an uneventful pregnancy and birth. A pretty standard biography for a 24-year-old. The woman wasn’t completely unaffected – she had suffered from uncertain, clumsy, movements her whole life.

But the surprise is how she moves at all, missing a part of the brain that is so fundamental it evolved with the first vertebrates. The sharks that swam when dinosaurs walked the Earth had cerebellums. This case points to a sad fact about brain science. We don’t often shout about it, but there are large gaps in even our basic understanding of the brain. We can’t agree on the function of even some of the most important brain regions, such as the cerebellum. Rare cases such as this show up that ignorance. Every so often someone walks into a hospital and their brain scan reveals the startling differences we can have inside our heads. Startling differences which may have only small observable effects on our behaviour. This case points to a sad fact about brain science. We don’t often shout about it, but there are large gaps in even our basic understanding of the brain. We can’t agree on the function of even some of the most important brain regions, such as the cerebellum.

Rare cases such as this show up that ignorance. Every so often someone walks into a hospital and their brain scan reveals the startling differences we can have inside our heads. Startling differences which may have only small observable effects on our behaviour. Part of the problem may be our way of thinking. It is natural to see the brain as a piece of naturally selected technology, and in human technology there is often a one-to-one mapping between structure and function. If I have a toaster, the heat is provided by the heating element, the time is controlled by the timer and the popping up is driven by a spring. The case of the missing cerebellum reveals there is no such simple scheme for the brain. Although we love to talk about the brain region for vision, for hunger or for love, there are no such brain regions, because the brain isn’t technology where any function is governed by just one part.

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