Turkey Archives - Page 3 of 16 - The Automatic Earth

“..you’d have basically Thanksgiving to Christmas — which would be wonderful because there’s no deadline in the world like the next break to motivate senators..”

• McConnell: Senate Impeachment Trial ‘As Soon As Thanksgiving’ (ZH)

Senate Majority Leader Mitch McConnell (R-KY) told Republican Senators on Wednesday to prepare for an impeachment trial of President Trump as soon as Thanksgiving, according to the Boston Globe. The announcement comes as House Democrats roll the dice on a second-hand claim from a CIA ‘whistleblower’ that President Trump pressured Ukraine’s president to investigate former VP Joe Biden – who the whistleblower worked for – and Biden’s son Hunter [..] .. while Trump will almost certainly be impeached by the Democrat-controlled House, the GOP-controlled Senate will be able to pick apart the entire affair.

“In their closed-door weekly luncheon, McConnell gave a presentation about the impeachment process and fielded questions alongside his staff and Senate Judiciary Committee Chairman Lindsey Graham, Republican of South Carolina, who was a manager for the 1998 impeachment of President Bill Clinton. “Impeachment is the first step to remove a president, with the House voting on formal charges and the Senate holding a trial in which it either convicts or acquits him. -Boston Globe “There’s sort of a planned expectation that it would be sometime around Thanksgiving, so you’d have basically Thanksgiving to Christmas — which would be wonderful because there’s no deadline in the world like the next break to motivate senators,” said Sen. Kevin Cramer (R-ND) following the meeting.

McConnell has previously said that if the House impeaches Trump, Senate rules would force him to begin a trial – one which could force the Bidens to testify. “Not only could Mr. Biden be forced to be in D.C. at a critical moment in the presidential campaign, but so could many of his chief rivals — the half-dozen senators also vying for Democrats’ presidential nomination, impeachment experts said. For that matter, if the House chooses to impeach Mr. Trump on charges stemming from the special counsel’s Russia investigation, aides said it could open the door to witnesses such as fired FBI Agent Peter Strzok or even major figures from the Obama administration. Mr. Trump could even be present for the entire spectacle. Experts said the Senate would have a hard time refusing him if he demanded to confront the witnesses against him.” -Washington Times

Uber trolling.

• Trump Florida Golf Course To Host G7 Summit (BBC)

One of President Donald Trump’s golf resorts in Florida will host the G7 summit next June, the White House says. White House chief of staff Mick Mulvaney denied President Trump would profit from the event. The aide said “Donald Trump’s brand is probably strong enough as it is”, so he did not need a branding boost. Mr Trump has previously said he is not involved with the daily operations of the Trump Organization and that his sons run the business. Mr Mulvaney told reporters on Thursday that an advance team of scouts had started with a list of possible locations for the summit in about a dozen states. The team, he said, went to visit the venues in California, Colorado, Hawaii, Florida, North Carolina, Michigan, Tennessee and Utah.

“And it became apparent at the end of that process that Doral was by far and away, far and away, the best physical facility for this meeting. “In fact I was talking to one of the advance teams when they came back and I said, ‘What was it like?’ And they said, ‘You’re not going to believe this but it’s almost like they built this facility to host this type of event.'” The chief of staff said the event would be made available “at cost” and that using the Doral would save millions of dollars and was cheaper than the other potential sites. Earlier this year the US president floated the idea of his Doral property hosting the G7. But Mr Mulvaney denied on Thursday that his boss was profiting from the presidency, pointing out that he donates his salary to charity.

“It’s the most recognisable name in the English language [Trump] and probably around the world right now, so no, that has nothing to do with that,” he said. Mr Mulvaney said he had initially been sceptical about the idea and “aware of the political sort of criticism that we’d come under for doing it at Doral”. He added: “I get the criticisms, so does he. Basically, he’d be criticised regardless of what he’d chose to do, but no there’s no issue here on him profiting from this any way, shape or form.”

120 hours. Followed by a ceasefire.

• Turkey To Suspend Syria Offensive, Mike Pence Announces (BBC)

Turkey has agreed to a ceasefire in northern Syria to let Kurdish-led forces withdraw, US Vice-President Mike Pence has announced. All military operations will be paused for five days, and the US will help facilitate an “orderly withdrawal” of Kurdish-led troops from what Turkey has termed a “safe zone” on the border. Turkey launched its assault last week. It aimed to repel a Kurdish militia that it views as a terrorist group, and resettle Syrian refugees in the area. Critics fear this could lead to ethnic cleansing of the local Kurdish population.

The cross-border offensive came after US President Donald Trump pulled US forces out of the border region. His decision prompted a raft of criticism at home and abroad, with some accusing him of giving Turkish President Recep Tayyip Erdogan a “green light” for the operation. Mr Trump tweeted about the ceasefire before Mr Pence announced it, writing that “millions of lives will be saved!” Mr Pence thanked Donald Trump’s “strong leadership” during the announcement. “He wanted a ceasefire. He wanted to stop the violence,” the vice-president said.

It’s obvious where Ron Paul stands, he always has: The best way to help the Kurds and everyone else in the region is to just come home.

• Washington is Wrong Once Again – Kurds Join Assad to Defend Syria (Ron Paul)

When President Trump Tweeted last week that “it is time for us to get out of these ridiculous endless wars,” adding that the US would be withdrawing from Syria, Washington went into a panic. Suddenly Republicans, Democrats, the media, the think tanks, and the war industry all discovered and quickly became experts on “the Kurds,” who we were told were an “ally” being sent to their slaughter by an ignorant President Trump. But it was all just another bipartisan ploy to keep the “forever war” gravy train rolling through the Beltway. Interventionists will do anything to prevent US troops from ever coming home, and their favorite tactic is promoting “mission creep.”

As President Trump Tweeted, we were told in 2014 by President Obama that the US military would go into Syria for just 30 days to save the Yazidi minority that they claimed were threatened. Then that mission crept into “we must fight ISIS” and so the US military continued to illegally occupy and bomb Syria for five more years. Even though it was the Syrian army with its Russian and Iranian allies that did the bulk of the fighting against al-Qaeda and ISIS in Syria, President Trump took credit and called for the troops to come home. But when the military comes home, the military-industrial-Congressional-media complex loses its cash cow, so a new rationale had to be invented.

The latest “mission creep” was that we had to stay in Syria to save our “allies” the Kurds. All of a sudden our military presence in Syria was not about fighting terrorism but rather about putting US troops between our NATO ally Turkey and our proxy fighting force, the Kurds. Do they really want us to believe that it is “pro-American” for our troops to fight and die refereeing a long-standing dispute between the Turks and Kurds?

Moon of Alabama is the first I’ve seen mention that the YPG “will be disbanded and integrated into the Syrian army.”

As I wrote a few days ago in Trump Talks To Putin. But How?, this whole thing has been planned and co-ordinated, much more than western media report.

• Media And Pundits Misread The ‘Everyone Wins’ Plan For Syria (MoA)

The U.S. media get yesterday’s talks between U.S. Vice President Mike Pence and the Turkish President Recep Tayyip Erdogan all wrong. Those talks were just a show to soothe the criticism against President Donald Trump’s decision to withdraw U.S. troops from northeast Syria. The fake negotiations did not change the larger win-win-win-win plan or the facts on the ground. The Syrian Arab Army is replacing the Kurdish PKK/YPG troops at the border with Turkey. The armed PKK/YPG forces, which had deceivingly renamed themselves (vid) “Syrian Democratic Forces” to win U.S. support, will be disbanded and integrated into the Syrian army. Those moves are sufficient to give Turkey the security guarantees it needs. They will prevent any further Turkish invasion.

[..] The U.S. can not “allow Turkey to annex a portion of Syria”. The U.S. does not own Syria. It is completely bollocks to think that it has the power to allow Turkey to annex parts of it. Turkey will not “gain territory”. There will be no Turkish “security corridor”. The Kurdish civilians in Kobani, Ras al Ain and Qamishli areas will not go anywhere. The Turks will not touch those Kurdish majority areas because they are, or soon will be, under control of the Syrian government and its army. [..] The Turkish Foreign Minister Cavusoglu confirmed that Turkey agrees with the Syrian government moves: “Russia “promised that the PKK or YPG will not be on the other side of the border,” Cavusoglu said in an interview with the BBC. “If Russia, accompanied by the Syrian army, removes YPG elements from the region, we will not oppose this.”

These moves have been planned all along. The Turkish invasion in northeast Syria was designed to give Trump a reason to withdraw U.S. troops. It was designed to push the Kurdish forces to finally submit to the Syrian government. Behind the scene Russia had already organized the replacement of the Kurdish forces with Syrian government troops. It has coordinated the Syrian army moves with the U.S. military. Turkey had agreed that Syrian government control would be sufficient to alleviate its concern about a Kurdish guerilla and a Kurdish proto-state at its border. Any further Turkish invasion of Syria is thereby unnecessary. The plan has everyone winning. Turkey will be free of a Kurdish threat. Syria regains its territory. The U.S. can leave without further trouble. Russia and Iran gain standing. The Kurds get taken care of.

“Boris Johnson has signed a deal he said he didn’t need, creating a border he didn’t want, under the authority of a Court he didn’t accept, to be submitted to a Parliament he doesn’t control. ”

• UK Agrees To Best Of Worst Possible Brexit Deals (MW)

Boris Johnson has signed a deal he said he didn’t need, creating a border he didn’t want, under the authority of a Court he didn’t accept, to be submitted to a Parliament he doesn’t control. The one “great” thing about the agreement with the European Union that the U.K. prime minister hailed Thursday is that it reduces – if slightly – the possibility of a hard Brexit, and the associated foreseeable economic crisis. But beyond the forex market’s obvious relief at the possible end of three years of uncertainty — the pound jumped almost 1% on the news, before reversing — this is still a deal that will hurt the British economy. On a scale of 1 to 10 — from no-pain, remain in the EU to maximum damage, no-deal Brexit — the agreement concluded just a few hours before an EU leaders summit in Brussels registers as an 8 or 9.

Its economic impact will be worse than the deal negotiated by Johnson’s predecessor Theresa May and rejected three times by the U.K. Parliament earlier this year. That is true both in the short term and in the long term. In the short term, it leaves the U.K. outside the customs union where it would have stayed under the infamous “backstop” negotiated by the previous government. But more uncertainty is also hanging over the near term economic future. The dearth of investment in the last three years has been the main drag on the U.K. economy, which explains why the country’s GDP is now 1-to-3% lower than it would have been if voters had opted for remain in 2016.

People are pressed to vote for a deal they don’t want. Is that really such a good idea?

• EU Leaves Door Open To Brexit Extension, In Blow To Boris Johnson (G.)

EU leaders have left open the option of extending Brexit beyond 31 October if the new deal is voted down by the Commons, in a blow to Boris Johnson’s strategy. The prime minister had been seeking to pitch Saturday’s vote in the Commons as a choice between deal or no deal after coming to an agreement with the EU. Johnson was helped by comments from Jean-Claude Juncker casting doubt on the possibility of a further Brexit delay, but the heads of state and government did not follow the European commission president’s lead. A summit communique issued after two hours of discussion tasked the commission and European parliament with taking “the necessary steps to ensure that the agreement can enter into force on November 1”.

But a senior EU official said that the leaders would follow events on Saturday, and reflect on the next steps if they were in a “different situation”. A second diplomatic source said they had chosen not to interfere in a “sensitive domestic debate … but they leave the door open to the possibility of an extension, to be discussed at a later stage – if required”. Johnson is facing an uphill battle to build a majority after the Northern Irish Democratic Unionist party rejected the revised deal, describing it as driving “a coach and horses through the professed sanctity of the Belfast agreement”. Juncker had tried to help sell the deal by pouring doubt on a further Brexit extension in the event of it being rejected.

So even if the deal is accepted, it may still not be?

• UK MPs Win Bid To Vote On 2nd Brexit Referendum In Saturday Showdown (Ind.)

MPs have won a key parliamentary vote paving the way for a Commons bid to secure a second referendum on Saturday. Ex-Tory backbencher Sir Oliver Letwin led a successful attempt to allow backbench MPs to amend Boris Johnson’s Brexit plans, in a knife-edge vote that passed by 287 votes to 275. MPs also approved a rare Saturday sitting to scrutinise Mr Johnson’s new plan – but the government’s proposal for a short debate on a motion to either “approve the deal or approve a no-deal Brexit” were derailed by the backbench victory. The move now clears the way for pro-EU MPs to force a vote on a second referendum, by tacking on an amendment calling for another public vote on the prime minister’s Brexit blueprint.

Sir Oliver said the plan would allow MPs to move any amendment to the government’s proposal and for them to be voted upon, if selected by Speaker John Bercow. He suggested that it could close a loophole in the so-called Benn Act – which requires the PM to seek a Brexit delay if he does not have a deal by 19 October. The law only compels the PM to seek an extension if MPs fail to pass a motion. Sir Oliver told MPs: “That will enable those of us, like me, who wish to support and carry through and eventually see the ratification of this deal, not to put us in the position of allowing the government off the Benn Act hook on Saturday, but only at a time when the bill has been taken through both Houses of Parliament and legislated on.”

A discussion you won’t be able to escape. It might be good to get the terminology straight. I think Tucker Carlson called Medicare for All pure socialism, but that would mean Canada, the UK, most of Europe and Asian countries like Thailand all pure socialist countries. Hard to maintain.

• How Slashing Pentagon Budget Could Pay for Medicare for All (Conley)

The Institute for Policy Studies on Thursday shared the results of extensive research into how the $750 billion U.S. military budget could be significantly slashed, freeing up annual funding to cover the cost of Medicare for All—calling into question the notion that the program needs to create any tax burden whatsoever for working families. Lindsay Koshgarian, director of the National Priorities Project at the Institute for Policy Studies (IPS), took aim in a New York Timesop-ed at a “chorus of scolds” from both sides of the aisle who say that raising middle class taxes is the only way to pay for Medicare for All. The pervasive claim was a primary focus of Tuesday night’s debate, while Medicare for All proponents Sens. Bernie Sanders (I-Vt.) and Elizabeth Warren (D-Mass.) attempted to focus on the dire need for a universal healthcare program.

At the Democratic presidential primary debate on CNN Tuesday night, Sen. Elizabeth Warren (D-Mass.) was criticized by some opponents for saying that “costs will go down for hardworking, middle-class families” under Medicare for All, without using the word “taxes.” Sen. Bernie Sanders (I-Vt.), on the other hand, clearly stated that taxes may go up for some middle class families but pointed out that the increase would be more than offset by the fact that they’ll no longer have to pay monthly premiums, deductibles, and other medical costs. “All these ambitious policies of course will come with a hefty price tag,” wrote Koshgarian. “Proposals to fund Medicare for All have focused on raising taxes. But what if we could imagine another way entirely?”

“Over 18 years, the United States has spent $4.9 trillion on wars, with only more intractable violence in the Middle East and beyond to show for it,” she added. “That’s nearly the $300 billion per year over the current system that is estimated to cover Medicare for All (though estimates vary).” “While we can’t un-spend that $4.9 trillion,” Koshgarian continued, “imagine if we could make different choices for the next 20 years.”

The state of denial. Pensions funds have all moved into risk assets, so if stocks start falling, it’s over and out. Moreover, there will be far more elderly people soon vs the young, which will reduce contributions enormously while increasing payouts. At least try some realism. Zero interest rates klill pensions. Period.

• Going Dutch? Low Interest Rates Rattle ‘World’s Best’ Pension System (R.)

The planned reductions, due to take effect from January 2020, have shaken a country renowned for having one of the world’s strongest pension systems, and are an early warning to others about the impact of record low interest rates. [..] The European Central Bank’s (ECB) stimulus policies, which have helped drive interest rates into negative territory, are blamed in part for the impending cuts in the Netherlands and have triggered a fierce debate over how the funding of pensions should be calculated. ECB President Mario Draghi said last month that the central bank was “very concerned” about the side effects of negative rates, but maintained they were required for economic growth.

At the heart of the Dutch debate is a technical question over how to calculate the cost of future pension payouts while the ECB helps keep rates low. Actuaries make assumptions about how long pensioners will live, count up the future payments that have been promised to them and then use an assumed interest rate to “discount” how much must be put away to pay them. The lower this interest rate, “rekenrente” in Dutch, the more conservative the accounting, and the more it costs to meet future liabilities. The rekenrente is derived from government bond yields — which have turned negative across Europe as interest rates steadily fell this summer.

Each 1% fall in interest rates has led to roughly a 12% fall in the coverage ratio between assets and liabilities in pension pots, the Dutch central bank says. As a January deadline approaches, cuts appear inevitable. That has led several funds and some experts to argue that the rekenrente, which is around 0.3%, should be raised instead. Many blame ECB policy and see its effects as temporary. Increasing the rekenrente to 2% or 3% would restore the funds to full solvency. Corien Wortmann-Kool, the chairwoman of the 456 billion euro ABP civil servants fund, told Reuters she opposes pension cuts as “unnecessary” for now.

Trump Talks To Putin. But How?

Oct 152019

October 15, 2019 Posted by Raúl Ilargi Meijer at 7:29 pm Primers Tagged with: communication, Erdogan, Kurds, Putin, refugees, Syria, Trump, Turkey 8 Responses »

Rembrandt van Rijn Self portrait with tousled hair 1629

If you ask me, this is brilliant, but I know you’re not asking me. Still, what I’m reading today is genius. That is, Donald Trump and his people have found a way to communicate with Vladimir Putin and his people while the entire crew that’s listening in to his talks with foreign leaders were doing something else, whatever that may be.

The overall impression of Trump’s order to redeploy an entire 50 US soldiers within Syria is that he opened the floodgates to mayhem and genocide, but perhaps that picture is not entirely accurate. Perhaps Trump did not act on some whiff of the moment instinct. Perhaps he’s not as shallow and stupid as the press makes him out to be. I know, big challenge and all, but let’s look at what actually happened.

Me, I’m sure Trump talked to Putin before he withdrew the 49 or 50 troops , just to make sure all-out disaster wouldn’t ensue. This is from Newsweek, not exactly a pro-Trump outlet:

US Cedes Syrian City To Russia In Battlefield ‘Handover’ As Turkey Tries To Take It

The U.S. was scheduled as of Monday to officially withdraw from Manbij within 24-hours, leaving the mostly Kurdish Syrian Democratic Forces behind as two rival factions—the Syrian government, backed by Russia and Iran, and the Turkey-backed Syrian insurgents opposed to it—sought to seize control of the strategic location. A senior Pentagon official told Newsweek that U.S. personnel, “having been in the area for longer, has been assisting the Russian forces to navigate through previously unsafe areas quickly.”

“It is essentially a handover,” the official said. “However, it’s a quick out, not something that will include walk-throughs, etc., everything is about making out with as much as possible of our things while destroying any sensitive equipment that cannot be moved.” Contacted by Newsweek on Monday, no reply was returned from the Pentagon before publication. Faced with a potentially imminent clash with Turkish forces and their Syrian rebel allies, the Syrian Democratic Forces have chosen to realign themselves with the central government and its Russian backer, a partnership that would soon be put to the test.

I don’t claim to know how the two presidents manage to communicate in the face of all the scrutiny (re: Trump’s call with Ukraine president Zelensky), but communicate they did. Or we would never have arrived at the outcome we have. Trump, I’m convinced, did not leave the Kurds to die at the hand of Erdogan. He got Putin involved. And yes, that means Russia strengthening its position in Syria.

But it also means Trump being able to fulfill his campaign promise to withdraw US troops from “endless wars”. And Russia may well be the best bet to prevent further mayhem and bloodshed in the region. See, Syria, as I’ve said a million times by now, is Russia’s only stronghold in the Middle East, and they will therefore never let go of it. Not a chance.

That is the reason why the insane US policy of regime change in Iraq, Libya, etc., was never going to work in Syria. Syria = Russia. Not because Putin is a big admirer of Assad, but because without Syria Russia is gone from the Middle East. So, zero chance. A bit more from the BBC:

Russia Vows To Prevent Turkey-Syria Clashes

Russia has said it will not allow clashes between Turkish and Syrian forces, as Turkey’s military offensive in northern Syria continues. “This would simply be unacceptable… and therefore we will not allow it, of course,” said Moscow’s special envoy for Syria, Alexander Lavrentyev. The withdrawal of US troops from the region, announced last week, gave Turkey a “green light”, critics say. Russia is a key military ally of Syrian leader Bashar al-Assad. Russia’s defence ministry said its forces, which have been deployed in Syria since 2015, were patrolling along the “line of contact” between Syrian and Turkish forces.

During a visit to the United Arab Emirates, Mr Lavrentyev described Turkey’s offensive as “unacceptable”. He said that under previous agreements Turkey can only go 5-10km (3-6 miles) into Syria – far less than the 30km “safe zone” Ankara is proposing – and that Turkey has no right to permanently deploy its troops in the country. Syria is in contact with Turkey to avoid a conflict, he said. Mr Lavrentyev also confirmed that Russia had helped to broker a deal between Kurds and Damascus that saw Kurdish-led forces cede territory to Syrian government troops in return for military support.

All the talk about Erdogan genociding the Kurds is, well, greatly exaggerated. His hands are tied. By Trump, who has warned him with a threat of obliterating his economy, and far more by Putin who simply states some things are not acceptable.

The outcome of all this is going to be that Turkey will have its safe zone on the Syrian border, just smaller than Erdogan wants. The Kurds will have their territory just behind that safe zone. Millions of Syrian refugees will be able to resettle in these two territories. It is a pretty genius solution to the whole issue. US troops, gone, Russia and Assad keeping the peace, no 3.6 million refugees coming to Europe.

And you were saying Trump is an idiot who leaves the Kurds to be slaughtered? You see, I’m never sure about anything, but I’m having to doubt that judgment. That’s not what I’m seeing.

But, you know, I am big time wondering what channels Trump and Putin have found to talk to each other. It’s not phone calls, given how the Zelensky call led to an alleged impeachment inquiry, but how have they managed to do it? Shouldn’t be all that hard, perhaps, just a friend talking to a friend under the radar. But still.

Debt Rattle October 15 2019

Oct 152019

October 15, 2019 Posted by Raúl Ilargi Meijer at 9:43 am Finance Tagged with: Bernie, Comey, Fauxbel, Ghislaine, Hong Kong, Huawei, NYT, poverty, sanctions, Shell, Syria, Turkey 11 Responses »

Paul Gauguin A seashore 1887

• Trump Tells Turkey To Stop Its Syria Invasion (R.)

• ‘You’ve Been Duped By Spooks & Terrorists’ (RT)

• Bernie Wants You to Own More of the Means of Production (Jac.)

• No Choice But To Invest In Oil, Shell CEO Says (R.)

• New German Rules Leave 5G Telecoms Door Open To Huawei (R.)

• James Comey Is Swimming In Cash (BI)

• Ghislaine Maxwell’s Open Secret (Webb)

• Behind Hong Kong’s Black Terror (Escobar)

• Trio Wins Economics Nobel For Science-Based Poverty Fight (R.)

Did they plan this in advance?

• Trump Tells Turkey To Stop Its Syria Invasion (R.)

U.S. President Donald Trump on Monday demanded Turkey stop its military incursion in Syria and imposed new sanctions on the NATO ally as Trump scrambled to limit the damage from his much-criticized decision to clear U.S. troops from Turkey’s path. Vice President Mike Pence said Trump had told Turkish President Tayyip Erdogan in a phone call on Monday to agree to an immediate ceasefire. He also said he would travel to the region soon to try to mediate the crisis. Pence said Trump had been firm with Erdogan on the phone. “The United States of America simply is not going to tolerate Turkey’s invasion in Syria any further. We are calling on Turkey to stand down, end the violence and come to the negotiating table,” Pence told reporters.

Turkey launched a cross-border operation into northern Syria on Wednesday just days after Erdogan told Trump in a phone call that he planned to move ahead with a long-planned move against America’s Kurdish allies in the region. Trump abruptly announced a redeployment of 50 American troops from the conflict zone to get them out of harm’s way, dismissing criticism that this would leave the Kurds open to attack. This was widely seen as giving Erdogan a green light for his operation. With lawmakers in the U.S. Congress moving to impose sanctions of their own, Trump issued an executive order authorizing sanctions against current and former officials of the Turkish government for contributing to Turkey’s military operation in northern Syria.

In a statement, Trump said he had increased tariffs on imports of Turkish steel back up to 50 percent, six months after they were reduced, and would immediately stop negotiations on what he called a $100 billion trade deal with Turkey. “Unfortunately, Turkey does not appear to be mitigating the humanitarian effects of its invasion,” said Trump.

The New York Times had no credibility left anyway.

• ‘You’ve Been Duped By Spooks & Terrorists’ (RT)

A damning report by the New York Times, which accused Russia of bombing four UN-protected hospitals in Syria, is a product of misinformation by Western intelligence services and jihadists, the Russian military said. On Sunday, the leading US newspaper said it had irrefutable proof that Russian warplanes had bombed four sites in Syria, which it knew to be locations of civilian hospitals. The accusation stems from analysis of social media, interviews with witnesses, data provided by local plane spotters and records of communications of the Russian military deployed in Syria. The bombings, which happened on May 5 and 6, are just a faction of attacks on civilian infrastructure, for which Moscow carries responsibility, the newspaper alleged.

Responding to the accusation on Monday, the Russian military said Times report was flawed for several reasons, including failure to explain that Idlib Governorate, where the four alleged bombings took place, lives under rule of brutal jihadists. That detail affects the entire narrative, indicating its flawed sourcing. “Gadgets, modern radio scanners, protected notebooks, internet connection are all things that the local civilian population simply cannot afford. They are more interested in daily surviving under the yoke of the terrorists,” said Defense Ministry spokesman Maj. Gen. Igor Konashenkov. He was referring to the equipment used by “plane spotters”, who provided their data to Times.

The newspaper said those observers “insisted on anonymity for their safety”, but the Russian military says they shouldn’t have bothered and identified them as the people behind a “combat intelligence system” based on equipment developed by a US company called Hala Systems. The system known as Sentry is a collection of suitcase-sized sensors connected into a network plus an AI-based algorithm, which uses signals from those sensors as well as social media data to analyze and predict airstrikes in Idlib. Hala Systems says it’s a for-profit company that develops and operates the system on grants from governments of Canada, the United Kingdom, the Netherlands, Denmark the United States, and Germany.

Electable?

• Bernie Wants You to Own More of the Means of Production (Jac.)

Bernie Sanders released a proposal today that would gradually shift 20 percent of corporate equity into funds owned and controlled by the workers in each company. The plan, which would apply to all publicly-traded companies and large closely-held companies, would move 2 percent of corporate stock into worker funds each year for a decade. Once the shares are transferred into the funds, workers would begin receiving dividends and have the ability to exercise the voting rights of the shares, including the right to vote on corporate board elections and on shareholder resolutions. Sanders’s plan is by far the most radical worker ownership proposal put forward by a presidential candidate in recent memory.

By last count, the market value of publicly-traded domestic companies stood at $35.6 trillion. This means that the Sanders plan would shift at least $7.1 trillion of corporate equity into worker funds by gradually diluting the value of previously-issued corporate stock. Those who stand to “lose” from the proposal are the incumbent owners of corporate equity, which are overwhelmingly affluent people. At present, the top 10 percent of families own around 86.4 percent of corporate equities and mutual fund shares, with the top one percent owning 52 percent by themselves.

Closely-held businesses, which will also be affected by the scheme if they are large enough, have similarly concentrated ownership, with the top 10 percent of families owning 87.5 percent of private business equity and the top one percent of families owning 57.5 percent of it. Of course, these incumbent owners will not actually lose anything in an absolute sense. The average historical return of the US stock market has been 9.8 percent per year, while the average return of the last 10 years has been just over 13 percent. The effect of the two percent share issuances is to knock the total rate of return down by two percentage points, meaning that incumbent owners still get richer year-over-year, just less so than they would absent the Sanders plan.

Well, they’re on oil company. What did you expect?

• No Choice But To Invest In Oil, Shell CEO Says (R.)

Royal Dutch Shell still sees abundant opportunity to make money from oil and gas in coming decades even as investors and governments increase pressure on energy companies over climate change, its chief executive said. But in an interview with Reuters, Ben van Beurden expressed concern that some shareholders could abandon the world’s second-largest listed energy company due partly to what he called the “demonisation” of oil and gas and “unjustified” worries that its business model was unsustainable. The 61-year-old Dutch executive in recent years became one of the sector’s most prominent voices advocating action over global warming in the wake of the 2015 Paris climate agreement.

Shell, which supplies around 3% of the world’s energy, set out in 2017 a plan to halve the intensity of its greenhouse emissions by the middle of the century, based in large part on building one of the world’s biggest power businesses. Still, the amount of carbon dioxide emitted from Shell’s operations and the products it sells rose by 2.5% between 2017 and 2018. A defiant van Beurden rejected a rising chorus from climate activists and parts of the investor community to transform radically the 112-year-old Anglo-Dutch company’s traditional business model. “Despite what a lot of activists say, it is entirely legitimate to invest in oil and gas because the world demands it,” van Beurden said. “We have no choice” but to invest in long-life projects, he added.

[..][ “We can sustain an upstream portfolio all the way into the 2030s if there is an economic rationale for doing that and a societal rationale for doing that,” van Beurden said. “Fortunately enough, we have more of those than we have money to spend on them.” Van Beurden rejected as a “red herring” arguments that Shell’s oil and gas reserves, which can sustain its current production for around eight years, would be economically unviable, or stranded, in the future. A lack of investment in oil and gas projects could lead to a supply shortage and result in price spikes, he said. “One of the bigger risks is not so much that we will become dinosaurs because we are still investing in oil and gas when there is no need for it anymore. A bigger risk is prematurely turning your back on oil and gas.”

Shell plans to increase its annual spending to around $32 billion by 2025 from the current $25 billion, with up to one tenth allocated to renewables and the power business. The company, the world’s largest dividend payer, plans to return $125 billion to shareholders in the five years to 2025.

“..banning the Chinese vendor would add years of delays and billions of dollars in costs to launching 5G networks.”

• New German Rules Leave 5G Telecoms Door Open To Huawei (R.)

Germany has finalised rules for the build-out of 5G mobile networks that, in a snub to the United States, will not exclude China’s Huawei Technologies. Government officials confirmed that Germany’s so-called security catalogue foresaw an evaluation of technical and other criteria, but that no single vendor would be barred in order to create a level playing field for equipment vendors. “We are not taking a pre-emptive decision to ban any actor, or any company,” German government spokesman Steffen Seibert told a news conference in Berlin on Monday. The United States has piled pressure on its allies to shut out Huawei, the leading telecoms equipment vendor with a global market share of 28%, saying its gear contained ‘back doors’ that would enable China to spy on other countries.

German operators are all customers of Huawei and have warned that banning the Chinese vendor would add years of delays and billions of dollars in costs to launching 5G networks. The Shenzhen-based company has denied the allegations by Washington, which imposed export controls on Huawei in May, hobbling its smartphone business and raising questions over whether the Chinese company can maintain its market lead. U.S. officials have also argued that, under China’s national intelligence law, all citizens and companies are required to collaborate in espionage efforts.

No kidding: “It’s a lot!” Comey told the Times. “Seriously, it’s crazy.”

• James Comey Is Swimming In Cash (BI)

Losing a job and having your career go up in flames can be scarring. But the smoldering embers sometimes give forth to fertile new soil from which to start anew. Few have had a more public and dramatic firing than former-FBI director James Comey, who President Donald Trump infamously and suddenly ousted in 2017 amid inquiries into Russian meddling and suspicions that he did not have Comey’s loyalty. That fateful decision sent Comey’s law-enforcement career up in smoke — and precipitated the special-counsel investigation by Robert Mueller — but also laid the groundwork to launch a lucrative second-act in media, including six-figure speaking fees, prestigious writing contracts, a TV series, and a multimillion dollar book deal.

In a profile of his post-FBI life by Matt Flegenheimer in The New York Times, Comey asserts his primary preoccupation now, as a self-described “unemployed celebrity,” is stopping Trump. This vocation, while lacking the official powers of his former post in the FBI, appears well-suited for raking in piles of cash. Comey may have lost a roughly $170,000 annual salary as FBI director, but now he earns as much in a single speaking engagement. He’s been traveling the country giving six-figure paid speeches on leadership, as well as gratis appearances at universities, according to the NYT. “It’s a lot!” Comey told the Times. “Seriously, it’s crazy.”

Comey recently gave talks at Yale, the University of Nevada-Las Vegas, and the Sacramento Speaker Series, and he’s due to speak at “Politicon” in Nashville later this month. He also has a contract to write opinion columns for The Washington Post, according to the NYT. And then there’s the forthcoming CBS Studios miniseries, in which he’ll be portrayed by actor Jeff Daniels. The series is based on Comey’s bestselling 2018 book, “A Higher Loyalty: Truth, Lies and Leadership,” which reportedly netted him millions as well. Of course, Comey was already a multimillionaire before accepting the job in 2013 as FBI director under President Barack Obama. In financial filings, he reported a net worth of $11 million, not including an anticipated $3 million payout from hedge-fund giant Bridgewater Associates, where Comey spent a couple years as general counsel.

Whitney Webb continues her series.

• Ghislaine Maxwell’s Open Secret (Webb)

Media reports cite Prince Andrew and Ghislaine Maxwell as having developed a close relationship at least by February 2000, when Andrew had spent a week at Epstein’s controversial New York penthouse at 9 East 71st Street. One report published in 2000 by London’s Sunday Times claimed that the two were introduced by Andrew’s ex-wife Sarah Ferguson, often referred to as “Fergie” in the press, and further claims that this introduction had taken place several years prior. Epstein is alleged to have first been introduced to Andrew via Maxwell in 1999. Years after this introduction was made, Jeffrey Epstein would provide financial assistance to Ferguson at Prince Andrew’s behest by paying Ferguson’s former personal assistant £15,000, allegedly in order to allow for “a wider restructuring of Sarah’s £5 million debts to take place,” according to The Telegraph.

Oddly, by April of that year, Maxwell and Prince Andrew were spotted by their fellow diners at a posh New York restaurant holding hands, prompting both the Prince and Maxwell to claim that their relationship was merely “platonic.” However, a separate report from 2007 in the Evening Standard refers to Maxwell as one of Prince Andrew’s former girlfriends. Within a year of their close relationship having become public, Andrew and Ghislaine were reported to have gone on eight different vacations together, of which Epstein accompanied them for five. Andrew also brought Maxwell and Epstein to celebrate the Queen’s birthday in 2000 as his personal guests.

Several reports from this period also provide interesting insight into Maxwell’s business activities and private life. One article from 2000, published in London’s Sunday Times, states that “for all her high-profile appearances on Manhattan’s A-List merry-go-round, she [Maxwell] is secretive to the point of paranoia and her business affairs are deeply mysterious.” It goes on to say that Maxwell “has been building a business empire as opaque as father’s” — referencing Robert Maxwell’s business empire, which included multiple front companies for Israeli intelligence — and adds that “her office in Manhattan refuses to confirm even the nature or the name of her business.”

A slightly different take.

• Behind Hong Kong’s Black Terror (Escobar)

The new slogans of Hong Kong’s black bloc – a mob on a rampage connected to the black shirt protestors – made their first appearance on a rainy Sunday afternoon, scrawled on walls in Kowloon. Decoding the slogans is essential to understand the mindless street violence that was unleashed even before the anti-mask law passed by the government of the Special Administrative Region (SAR) went into effect at midnight on Friday, October 4. By the way, the anti-mask law is the sort of measure that was authorized by the 1922 British colonial Emergency Regulations Ordnance, which granted the city government the authority to “make any regulations whatsoever which he [or she] may consider desirable in the public interest” in case of “emergency or public danger”.

Perhaps the Honorable Nancy Pelosi, Speaker of the US House of Representatives, was unaware of this fine lineage when she commented that the law “only intensifies concern over freedom of expression.” And it is probably safe to assume that neither she nor other virulent opponents of the law know that a very similar anti-mask law was enacted in Canada on June 19, 2013. More likely to be informed is Hong Kong garment and media tycoon Jimmy Lai, billionaire publisher of the pro-democracy Apple Daily, the city’s Chinese Communist Party critic-in-chief and highly visible interlocutor of official Washington, DC, notables such as US Vice President Mike Pence, Secretary of State Mike Pompeo, and ex-National Security Council head John Bolton.

On September 6, before the onset of the deranged vandalism and violence that have defined Hong Kong “pro-democracy protests” over the past several weeks, Lai spoke with Bloomberg TV’s Stephen Engle from his Kowloon home. He pronounced himself convinced that – if protests turned violent China would have no choice but to send People’s Armed Police units from Shenzen into Hong Kong to put down unrest. “That,” he said on Bloomberg TV, “will be a repeat of the Tiananmen Square massacre and that will bring in the whole world against China….. Hong Kong will be done, and … China will be done, too.”

Science fights poverty?! Sounds like absolute BS to me. I asked Steve Keen if he knows the winners. He replied:

“No. Experimental economics is the latest fad, though it’s not supposed to encompass real world experiments like the IMF’s program for Argentina.”

• Trio Wins Economics Nobel For Science-Based Poverty Fight (R.)

U.S.-based economists Abhijit Banerjee, Esther Duflo and Michael Kremer won the 2019 Nobel Economics Prize on Monday for work fighting poverty that has helped millions of children by favoring practical steps over theory. French-American Duflo becomes only the second woman to win the economics prize in its 50-year history, as well as the youngest at 46. She shared the award equally with Indian-born American Banerjee and Kremer, also of the United States. The Royal Swedish Academy of Sciences said their work had shown how poverty could be addressed by breaking it down into smaller and more precise questions in areas such as education and healthcare, and then testing solutions in the field.

It said the results of their studies and field experiments had ranged from helping millions of Indian schoolchildren with remedial tutoring to encouraging governments around the world to increase funding for preventative medicine. “It starts from the idea that the poor are often reduced to caricatures and even the people that try to help them do not actually understand what are the deep roots of (their) problems,” Duflo told reporters in Stockholm by telephone. “What we try to do in our approach is to say, ‘Look, let’s try to unpack the problems one-by-one and address them as rigorously and scientifically as possible’,” she added.

The team pioneered “randomized controlled trials”, or RCTs, in economics. Long used in fields such as medicine, an RCT could for example take two groups of people and study what difference a treatment makes on one group while the other group is only given a placebo. Applied to development economics, such field experiments found for example that providing more textbooks and free school meals had only small effects, while targeting help for weak students made a big difference to overall educational levels. “It’s a prize not just for us but for the whole movement,” Banerjee later told a joint news conference at the Massachusetts Institute of Technology (MIT), where they both work. Kremer is a researcher at Harvard University.

When small men begin to cast big shadows, it means that the sun is about to set

Lin Yutang

Debt Rattle October 14 2019

Oct 142019

October 14, 2019 Posted by Raúl Ilargi Meijer at 8:55 am Finance Tagged with: Boeing, Brexit, Catalonia, China, Ecuador, gold, Kurds, Lisa Page, Putin, quid pro quo, Syria, Trump, Turkey 7 Responses »

Martin Johnson Heade Thunderstorm on Narragansett Bay 1868

• Syrian Army Deployed To Country’s Northeast To Counter ‘Turkish Aggression’ (RT)

• Putin Says Trump Not To Blame For Lack Of Improvement In Russia-US Ties (R.)

• “If The Entire System Collapses, Gold Will Be Needed To Start Over” (ZH)

• Lisa Page’s ‘Quid Pro Quo’ With State Department Over Hillary Email (DM)

• Johnson To Set Out Post-Brexit Law And Order Drive In Queen’s Speech (R.)

• China 9-Month Exports To US Down 10.7%, Imports Fall 26.4% (R.)

• Emirates President Does Not Expect To Take Any Boeing 777x In 2020 (R.)

• Ecuador Repeals Law Ending Fuel Subsidies In Deal To Stop Protests (BBC)

• Catalonia Leaders Jailed For Between 9 And 13 Years By Spanish Court (BBC)

Now we can wait for US media suggesting Trump left Syria so Putin could move in.

• Syrian Army Deployed To Country’s Northeast To Counter ‘Turkish Aggression’ (RT)

Syrian government troops have reportedly entered Tell Tamer, a town in the middle of Kurdish-controlled part of the country, amid a continued Turkish offensive against Kurdish militias. Troops of the Syrian Arab Army have entered the town on Monday, according to the news agency SANA. Tell Tamer is a relatively small town, but it’s located on an intersection of several major roads and has strategic importance. Earlier the government troops were reported entering Al-Thawrah, a city in the Raqqa governorate located on the Euphrates River and famous for its proximity to a major dam. The relocation of Syrian troops comes as Kurdish militias in northeastern Syria face an incursion from neighboring Turkey.

See? He’s Putin’s lapdog.

• Putin Says Trump Not To Blame For Lack Of Improvement In Russia-US Ties (R.)

Moscow is not blaming U.S. President Donald Trump for failing to improve U.S.-Russian relations, a pledge he had made during his election campaign, Russian President Vladimir Putin said in an interview with Arab broadcasters. “We know that, including during his previous election campaign, he spoke in favor of a normalization (of U.S.-Russia relations), but unfortunately it has not happened yet,” Putin told Al Arabiya, Sky News Arabia and RT Arabic. “But we have no claims because we see what’s going on in U.S. domestic politics,” he said, according to a transcript published on the Kremlin’s website on Sunday.

Putin said the “internal political agenda” was not allowing Trump to take steps aimed at a drastic improvement of bilateral relations, adding Moscow would in any case work with any U.S. administration to the extent that Washington itself wants. Putin also said Russia had weapons that neutralize any threat from NATO’s missile deployments in Poland and Romania. “This obviously poses a threat to us because it’s an attempt to level out our strategic nuclear potential. It’s bound to fail, this attempt, it’s already obvious,” he said.

A: There’s only one central bank in Europe. B: A lot of Dutch gold is in London and the US.

• “If The Entire System Collapses, Gold Will Be Needed To Start Over” (ZH)

An article published by the De Nederlandsche Bank (DNB), or Dutch Central Bank, has shocked many with its claim that “if the system collapses, the gold stock can serve as a basis to build it up again. Gold bolsters confidence in the stability of the central bank’s balance sheet and creates a sense of security.” [..] The article, titled “DNB’s Gold Stock” states: “A bar of gold retains its value, even in times of crisis. This makes it the opposite of “shares, bonds and other securities” all of which have inherent risk and prices can go down. According to the IMF’s latest data, the DNB holds 615 tons (15,000 bars) of gold mainly in Amsterdam, with other stores in the U.K. and North America; the value of this gold reserve is over €6 billion ($6.62 billion).

Calling gold the “trust anchor,” the article details briefly why the hard asset is so important to wealth building and the global economy, claiming: “Gold is… the trust anchor for the financial system. If the whole system collapses, the gold stock provides a collateral to start over. Gold gives confidence in the power of the central bank’s balance sheet.” Why this sudden admission of what goldbugs have been saying for years? Perhaps it has to do with the fact that on October 7, the bank announced it would soon be moving a large part of its gold reserves to “the new DNB Cash Center at military premises in Zeist.” Almost as if the Netherlands is preparing for the grand reset, and is moving its most valuable asset to a “military” installation just for that purpose.

These people really thought they were running the country.

• Lisa Page’s ‘Quid Pro Quo’ With State Department Over Hillary Email (DM)

An FBI employee who texted with her in-house lover about blocking Donald Trump’s presidential ambitions wrote in 2016 of a ‘quid pro quo’ with the State Department to hide the fact that an email found on Hillary Clinton’s home-brew email server was considered classified. Lisa Page fretted in the closing days of the presidential campaign about a pending Freedom of Information Act disclosure of a discussion between top State and Justice Department officials about the potential trade. Under the arrangement, the State Department would have given the FBI more legal attachés for its overseas division in exchange for altering the basis for keeping one of the Clinton emails from the public.

At the time, the email in question was exempt from FOIA requests because it was classified – a fact that was ultimately made public. The FBI had asked the State Department to ‘change the basis of the FOIA withhold [decision] … from classified to something else.’ The plot was never consummated. But Page, an FBI lawyer, was worried enough about it at the time to alert her colleagues that other employees had told investigators about it. One of those colleagues was Peter Strzok, the married FBI agent she was having an affair with.

The email came to light on Monday as part of a raft of material released by Judicial Watch, a conservative government transparency group whose standard practice is to sue government agencies that slow-walk the disclosure of public records. Page and Strzok became poster children in 2017 for conservatives’ claims that the Burean was biased against Trump and took actions to tilt the election in Clinton’s favor despite the national security threats posed by classified material found on her unsecured private email server.

“What we’ve got in effect is a party political broadcast from the steps of the throne.”

• Johnson To Set Out Post-Brexit Law And Order Drive In Queen’s Speech (R.)

Queen Elizabeth will on Monday announce several new pieces of legislation to reform Britain’s justice system, in a ceremonial speech setting out Prime Minister Boris Johnson’s post-Brexit plans. The so-called Queen’s Speech is the highlight of a day of elaborate pageantry in Westminster and is used to detail all the bills the government wants to enact in the coming year. It is written for the 93-year old monarch by the government. But, with Brexit unresolved, and any plans beyond even the next seven days likely subject to an unpredictable election, rival parties said Johnson was misusing the politically-neutral Queen for political gain.

The speech will lay out 22 new bills – pieces of proposed legislation – including several covering tougher treatment for foreign criminals and sex offenders, and new protection for victims of domestic abuse. “Keeping people safe is the most important role of any government, and as the party of law and order it is the Conservatives who are cracking down on crime and better protecting society,” a statement from Johnson’s office setting out some details of the speech said. It will almost certainly include a section on a law to enact a Brexit deal. But, while any deal is still in the balance, new details are unlikely. The speech will also touch on election campaign issues like the health service and living standards.

“Having the Queen’s Speech and the State Opening of Parliament tomorrow is ludicrous, utterly ludicrous,” Corbyn said in a Sky News interview broadcast on Sunday. “What we’ve got in effect is a party political broadcast from the steps of the throne.”

Think it’s all the trade war?

• China 9-Month Exports To US Down 10.7%, Imports Fall 26.4% (R.)

China’s exports to the United States fell 10.7% from a year earlier in dollar terms in January-September, while U.S. imports dropped 26.4% during that period, a Chinese customs spokesman said on Monday. Trade frictions with the United States have led to some pressure on Chinese trade, although the latest Sino-U.S. trade talks have yielded favorable outcomes in some areas, customs spokesman Li Kuiwen told reporters.

Boeing has a lot of problems.

• Emirates President Does Not Expect To Take Any Boeing 777x In 2020 (R.)

Emirates doubts it will receive any of the 115 Boeing 777-9s it has ordered next year, its president said on Monday, as the U.S. planemaker grapples with challenges in building the jet. Emirates, a launch customer of the world’s biggest twin engined jet, was to receive its first 777-9 in 2020 but the manufacturer has suspended load testing of the plane. “… By the end of next year we were to have eight of them. Now it doesn’t look like we will have any,” Tim Clark said at a conference in Dubai. Boeing suspended load testing of the new widebody in September when media reports said a cargo door failed a ground stress test.

There have also been issues with General Electric’s new GE9X turbine engine that will power the jet. Boeing has said it expects to hold the initial flight test in 2020 and is aiming for the 777X to enter commercial service in the same year. Clark said he had told Boeing he insists on a 13 to 16 month test period for the new jet. Emirates ordered 150 777X jets, including 777-8 variants, in 2013. It later placed a preliminary order for 40 Boeing 787 Dreamliner jets in 2017, which Clark said he still saw a place for in the airline’s fleet plans. Boeing has also been unable to deliver any of its 737 MAX aircraft since the single-aisle plane was grounded worldwide in March…

Are they going to let Moreno stay in power?

• Ecuador Repeals Law Ending Fuel Subsidies In Deal To Stop Protests (BBC)

Ecuador’s government has agreed to restore fuel subsidies in a deal with indigenous leaders to end mass protests that have brought the capital, Quito, to a standstill, the UN says. It came after the two sides held talks brokered by the UN and the Roman Catholic Church. The talks, which were broadcast live on state television, came after nearly two weeks of violent demonstrations. President Lenín Moreno had imposed a curfew enforced by the military. The announcement after Sunday’s meeting sparked late night celebrations in Quito. Fireworks were set off and car drivers honked their horns. A joint statement said the government had withdrawn an order removing the fuel subsidies. “With this agreement, the mobilisations… across Ecuador are terminated and we commit ourselves to restoring peace in the country,” it said.

Europe, 2019.

• Catalonia Leaders Jailed For Between 9 And 13 Years By Spanish Court (BBC)

Spain’s Supreme Court has sentenced nine Catalan separatist leaders to between nine and 13 years in prison for sedition over their role in an independence referendum in 2017. Three other defendants were found guilty of disobedience but will not serve prison sentences. The 12 politicians and activists had all denied the charges. Separatists in Catalonia were planning mass civil disobedience ahead of the verdict. The prosecution had sought up to 25 years in prison for Oriol Junqueras, the former vice-president of Catalonia and the highest-ranking pro-independence leader on trial.

It’s time for much larger crowds.

Debt Rattle October 13 2019

Oct 132019

October 13, 2019 Posted by Raúl Ilargi Meijer at 9:25 am Finance Tagged with: Brexit, Ecuador, Fed, Kurds, Putin, Syria, Turkey, Versailles, violence 5 Responses »

Paul Gauguin Huts under trees 1887

• All Foreign Forces Should Leave Syria, Including Russia – Putin (RT)

• Domestic Politics, Idlib Sway Timing Of Turkey’s Syrian Operation (AlM)

• Army Deployed In Ecuador As Protests Descend Into Violence (G.)

• Ecuador Indigenous Group Says Will Continue Protests After Curfew Imposed (R.)

• Johnson Will Speak To EU Leaders On Brexit Deal By End Of Monday (R>)

• Labour Will Stop No-Deal Brexit ‘Whatever It Takes’ – Starmer (G.)

• The Beginning of the End (Sven Henrich)

• White House Accidentally Sends Ukraine Talking Points To Democrats Again (Hill)

Number of things on Turkey’s attack on Syria. First, Putin is right. Let Syrians return and let them be safe at home. Would solve many problems in one go.

• All Foreign Forces Should Leave Syria, Including Russia – Putin (RT)

The territorial integrity of Syria must be fully restored and all foreign forces should withdraw, including Russia if Damascus decides it doesn’t need Moscow’s help anymore, according to President Vladimir Putin. “All the forces deployed illegitimately inside any sovereign state – in this case Syria – must leave,” Putin said in a joint interview with RT Arabic, UAE-based Sky News Arabia, and Saudi Arabia’s Al-Arabiya broadcasters. This is true for everyone. If Syria’s new legitimate government chooses to say that they have no more need for Russia’s military presence, this will be just as true for Russia. Meanwhile, Moscow’s stance on the settlement in Syria remains unchanged and was already relayed to its partners Iran, Turkey and the US, the president noted.

“Syria must be free from other states’ military presence. And the territorial integrity of the Syrian Arab Republic must be completely restored.” Earlier this month, US President Donald Trump announced the withdrawal of US troops from border areas in northeastern Syria, saying it was time to “get out of ridiculous endless wars.” Unlike the Russian military, which arrived in the country at an invitation of the government in Damascus, US forces have been in Syria illegally since 2016. The Syrian government has repeatedly blasted the American military presence as a violation of its sovereignty. Putin was also asked about Moscow’s attitude towards NATO’s eastward expansion and buildup near Russian borders. “We are not happy about it… and voiced our concerns,” he replied.

Then some background from Al Monitor on 3.6 million Syrian refugees in Turkey. The west doesn’t do anything to solve the situation, apart from some money now and then. But it was the west that caused the problems with its attacks on Syria, Lybia etc.

• Domestic Politics, Idlib Sway Timing Of Turkey’s Syrian Operation (AlM)

Ankara is greatly concerned over the prospect of a new refugee influx from Idlib that would further entangle Turkey’s Syrian refugee problem. President Recep Tayyip Erdogan had warned in September that Turkey cannot tolerate another refugee wave atop the 3.6 million Syrians it is already hosting. Besides putting strains on Turkey’s financial resources and social stamina, the Syrian refugee problem has proved increasingly costly for the AKP in terms of domestic politics. It is no coincidence that since the party’s rout in the June 23 rerun in Istanbul, government spokesmen have constantly touted the safe zone plan inside Syria as a way to expedite the return of Syrian refugees.

Across Turkey and in big cities in particular, most of the Syrian refugees live in close proximity to AKP voters, either in the same neighborhoods or adjoining ones. Under the impact of the economic crisis, tensions between locals and refugees have grown, contributing to a gradual disenchantment with the government among AKP voters. In Istanbul — the heartbeat, the spirit and the mirror of the country — 73% of some 479,000 registered Syrians live in districts where local administrations are controlled by the AKP. Out of the 10 districts with the largest refugee numbers, seven are held by the AKP. Similarly, eight of the 10 districts with the biggest refugee populations in proportion to the locals are run by the AKP.

While announcing the launch of Operation Peace Spring, Erdogan said the campaign would “lead to the establishment of a safe zone, facilitating the return of Syrian refugees to their homes.” The political motive underlying this pledge rests on the fact that the Syrian refugee problem is becoming unbearable for the government. If the campaign progresses as planned, leading the Turkish military and its Syrian allies to take control of a border stretch running 30 kilometers (19 miles) deep to the east of the Euphrates, the Syrians who could be forced to flee Idlib in the near future could perhaps be placed in tent cities in this “security belt” without being let into Turkey at all and instead transferred via Afrin and al-Bab, which are already under Turkish control.

However, when it comes to Ecuador, the Guardian has an entirely different point of view. Not surprising, since they sided with Moreno against Assange. But my Twitter feed is full of videos of extreme Ecuador police and army violence against their own people, snipers on rooftops, the works. Looks just like the Turkish-led assault on Kurds. The Guardian, though, suggests in this case the protesters are violent.

• Army Deployed In Ecuador As Protests Descend Into Violence (G.)

President Lenín Moreno ordered the army on to the streets of Ecuador’s capital Quito after a week and a half of protests over fuel prices devolved into violent incidents, with masked protesters attacking a television station, newspaper and the national auditor’s office. Moreno said the military enforced curfew would begin at 3pm local time in response to violence in areas previously untouched by the protests. Masked protesters broke into the national auditor’s office and set it ablaze, sending black smoke billowing across the central Quito park and cultural complex that have been the epicentre of the protests.

Later, several dozen masked men swarmed the offices of the private Teleamazonas television station, set fires on the grounds and tried to break into the building where about 20 employees were trapped. “They’re trying to enter the station, trying to break down the doors, we’re asking for help but the police aren’t coming,” one employee told the Associated Press. A journalist with the newspaper El Comercio told the AP that the paper’s offices were also under attack. The building’s security guards were seized and tied up and attackers were trying to break into offices where journalists were hiding.

Moreno appeared on national television alongside his vice-president and defence minister to announce that he was ordering people indoors and sending the army on to the streets. He blamed the violence on drug traffickers, organised crime and followers of former president Rafael Correa, who has denied allegations that he is trying to topple Moreno’s government.

Moreno has turned into a right-wing US backed dictator, that much is clear. Guess we’ll never know what they have on him that made him turn 180º.

• Ecuador Indigenous Group Says Will Continue Protests After Curfew Imposed (R.)

Ecuadorean indigenous group Conaie said late on Saturday that it would continue anti-austerity protests after President Lenin Moreno imposed a military-enforced curfew in the capital Quito and the armed forces said they would restrict movement across the country. The group suggested that its decision earlier in the day to hold direct talks with Moreno about a decree that cut fuel subsidies might be at risk by the military crackdown. Conaie has led protests against the law but has rejected vandalism that swept Quito on Saturday. “There’s no real dialogue without guarantees for the safety of indigenous leaders,” Conaie said in a statement on Twitter.

“We’ll carry out approaches to try to repeal the decree,” it added, “but we will hold protest actions nationally..exhorting the government to provide necessary guarantees.” It did not specify when it would hold protests or if it would do so in defiance of the curfew. Moreno did not say when the curfew in Quito would end.

Was Boris only now advised about violence?

• Johnson Will Speak To EU Leaders On Brexit Deal By End Of Monday (R>)

British Prime Minister Boris Johnson will speak to German Chancellor Angela Merkel, French President Emmanuel Macron and European Commission President Jean-Claude Juncker by the end of Monday to urge the leaders to support his Brexit deal, the Sunday Times reported. Johnson will offer the three leaders the option to either help him deliver a new deal this week, or to agree on a friendly version of a no-deal Brexit by Oct. 31, the newspaper said, citing a source familiar with the conversations. “He’ll be talking to Merkel, Macron and Juncker by the end of Monday to see if there’s agreement on a ‘landing zone’ for Northern Ireland and customs,” the source was quoted as telling the newspaper.

“The alternative is to agree a friendly version of no deal and finish it that way.” Security chiefs have convinced Johnson that a no-deal Brexit will heighten the danger of extremist attacks in Northern Ireland and on the mainland, along with sectarian violence in cities such as Glasgow, according to the report. As a result, the British prime minister desperately wants a Brexit deal, the Sunday Times reported. “Any one of these risks we could cope with, but taken collectively they would be a massive challenge to the UK state and no one would choose to go down that route,” Johnson told a senior Conservative in a private conversation, according to the newspaper.

is it election time already?

• Labour Will Stop No-Deal Brexit ‘Whatever It Takes’ – Starmer (G.)

Labour will take action in the courts to prevent Boris Johnson from pushing through a no-deal Brexit against the will of parliament, Keir Starmer has pledged. The shadow Brexit secretary said that if the prime minister is unable to reach an agreement with Brussels by 31 October, he must comply with the Benn act and seek a further delay. In a speech at the Co-operative party conference in Glasgow, Starmer said: “If he can’t – or I should say won’t – get a deal we will take whatever steps are necessary to prevent our country crashing out of the EU without a deal. “If no deal is secured by this time next week, Boris Johnson must seek and accept an extension. That’s the law. No ifs, no buts. And if he doesn’t, we’ll enforce the law – in the courts and in parliament. Whatever it takes, we will prevent a no-deal Brexit.”

Starmer dismissed suggestions that the prime minister could circumvent the law by accompanying a request for an extension with a second letter to the EU saying he did not want one. “That’s the equivalent of attaching a Post-it note to divorce papers saying ‘only kidding’ – It’s a ridiculous idea,” he said. Officials are continuing talks in Brussels over the weekend after the EU’s chief negotiator, Michel Barnier, gave the go-ahead on Friday for intensive negotiations to start. Starmer said that if the prime minister succeeded in getting an agreement, Labour would demand it was put to the public in a referendum.

“And really Fed? You are throwing this $60B a month announcement out on a Friday with the $DJIA already up 350 points?”

• The Beginning of the End (Sven Henrich)

They sure are trying their best. To do what? To goose markets higher. It’s been quite the spectacle all year, but this Friday sure took the cake. The entire week had been a giant jerk fest of sudden rips and dips as headline chasing algos were ripping through support and resistance levels unleashed like fat kids at the candy shop. But this Friday was something else, almost designed to have markets overdose on an insulin spike. Ever more hyped up on an impending China deal, every meeting, and movement of negotiators caused market spikes, a Trump tweet about “warm feelings”, a $82.7B repo operation by the Fed to keep things tidy, a sudden out of the blue $60B/month Treasury buying operation announced by the Fed, multiple Fed speakers to boot, what a scene.

And really Fed? You are throwing this $60B a month announcement out on a Friday with the $DJIA already up 350 points? What are you thinking here? The Fed knows this kind of announcement juices up markets. The Fed sheepishly claims it’s not QE. Oh piss off already. Expanding the balance sheet by $60B a month is a massive intervention any way you cut it or slice it. How big? Do the math. $60B per month is a run rate of $720B a year. And while they claim they’ll stop it in Q2 next year who really believe anything they say? Did you believe QT was on autopilot last year? Lol. Fool me once.

You know what else is $720B a year or $60B a month? The ENTIRE US MILITARY BUDGET. The largest military budget on the planet. Millions under arms, submarines, aircraft carriers, nuclear arsenal, bombers, fighter jets, military bases across the globe, satellites, drones, laser guided missiles, you name it. All of it runs at $60B per month. So lest everyone is blind to numbers these days as everything is so monstrous our eyes glaze over I trust this comparison highlights how massive the Fed’s announcement was on Friday. But not QE. Right. Believe it if you so choose.

Accidental? You sure?

• White House Accidentally Sends Ukraine Talking Points To Democrats Again (Hill)

The White House accidentally sent Democrats a list of talking points related to ex-Ukraine Ambassador Marie Yovanovitch’s Friday House deposition, two sources with knowledge of the email told The Hill, the second time in a month the administration has sent its Ukraine talking points to Democrats. The email included guidance for Republicans seeking to defend the president from potentially damaging witness testimony from an ambassador who was removed from her post in May under controversial circumstances. In copies of the guidance shared with The Hill, the White House encouraged Republicans to adopt a series of messages designed to turn the tables back on Democrats, including attacks on House Intelligence Committee Chairman Adam Schiff’s (D-Calif.) handling of the investigation.

Yovanovitch told House lawmakers that she was removed after “a concerted campaign” against her from President Trump and his allies. She also said in her opening statement that the State Department had “been under pressure from the president to remove me since the summer of 2018.” Yovanovitch’s ouster came two months before Trump’s July 25 phone call with the Ukrainian president — now at the center of Democrats’ impeachment inquiry — in which Trump asked Kiev to open an investigation into former Vice President Joe Biden, a leading 2020 presidential candidate. “We are not concerned with any information Yovanovitch might share, because the President did nothing wrong,” the White House email meant for Republicans said.

“But we are concerned that Schiff is putting her in a precarious position by having her testify in secret without State Department lawyers be present.” “It raises serious questions about why Schiff is willing to put career officials in such risky situations while bullying them with legally unfounded threats of obstruction charges,” the email continued. It added that Schiff “is willing to ride roughshod over fair process and to use career officials to further a baseless political objective.” The email marks the second time the White House has unintentionally sent talking points to Democrats in recent weeks, after an administration official inadvertently emailed them suggested rhetoric defending the July 25 phone call.

Debt Rattle October 12 2019

Oct 122019

October 12, 2019 Posted by Raúl Ilargi Meijer at 9:19 am Finance Tagged with: Assange, Boeing, Brexit, China, crypto, Kurds, Libra, Syria, Trump, Turkey, used cars 9 Responses »

Balthus Girl at the window 1955

• US Delays China Tariff Increase As Trump Claims ‘Substantial’ Deal (G.)

• Boris Johnson’s Major U-Turn Sets Up 48 Hours To Clinch Brexit Deal (G.)

• Turkey Attacks US Special Forces In Syria (NW)

• US Lawmakers Press Again For Stronger Trump Action On Turkey (R.)

• In Memoriam: Reality (Kunstler)

• Boeing Board Strips CEO Of Chairman Title Amid 737 MAX Crisis (R.)

• Facebook’s Libra Currency Abandoned By Major Financial Companies (R.)

• US SEC Halts Telegram’s $1.7 Billion Digital Token Offering (R.)

• Rising Used Car Prices Help Push Poor Americans Over The Edge (R.)

• Saudi Naval Blockade Sparks Fresh Humanitarian Crisis in Yemen (MPN)

• Human, Organ Trafficking Booming in Yemen as War Enters its Fifth Year (MPN)

• Julian Assange To Remain Locked Up In UK Prison (RT)

Not much of a deal, but lots of talk, from what I understand. Still, 1.3 billion Chinese need food.

• US Delays China Tariff Increase As Trump Claims ‘Substantial’ Deal (G.)

Donald Trump announced a “very substantial phase one deal” to solve the long-running trade dispute with China. After a two-day meeting in Washington between US and Chinese officials on Friday Trump announced a delay on plans to raise tariffs on $250bn worth of goods to 30% on 15 October. A further 15% tariff on almost all remaining Chinese imports including laptops, smartphone, footwear and clothing is still set to be imposed on 15 December unless a deal can be reached with Beijing. Trump said progress had been made on allegations of currency manipulation, intellectual property theft and other issues.

China also agreed to increase its purchases of US agricultural goods and further open up its market to foreign financial services companies. The deal has not been written yet and may take weeks to finalize. Speaking in the White House Trump said: “I think we have a lot of good faith right now.” He said the agreement was bigger than a trade deal. “There was a lot of friction between the US and China and now it’s a lovefest,” said Trump. Earlier Trump had tweeted there were “warmer feelings” in US-China trade talks. The news helped boost stock prices with the Dow Jones Industrial Average closing up 319 points and the S&P 500 snapping a three-week losing streak.

Will Northern Ireland remain in the customs union forever?

• Boris Johnson’s Major U-Turn Sets Up 48 Hours To Clinch Brexit Deal (G.)

Boris Johnson has signalled that he will make a last-ditch U-turn on his plans for the Irish border, setting up 48 hours of intense negotiations that will make or break a Brexit deal. On a day of rapid movement in talks, EU sources said the prime minister had conceded that there could not be a customs border on the island of Ireland – a critical step away from his previous position. That came after European ambassadors prompted tentative hope of a deal by giving the green light for what some diplomats described as a “tunnel” discussion in which a small team of negotiators meet for intensive talks to find a break-through moment.

The Democratic Unionist party and European Research Group (ERG), a group of rightwing Conservatives, later issued statements promising flexibility, keeping hope alive that Johnson could find support for a new offer in the House of Commons. But amid ongoing scepticism that a deal could be forced through in the short time left and with Angela Merkel due to hold talks with Emmanuel Macron on Sunday night, the prime minister faces a frantic race to push through his fresh proposals with Brussels or at home. “The UK has accepted that there is not a deal that involves a border on the island of Ireland – that is a big break from what they were saying,” one EU source said. “Now the key is for them to lay out how their new position over the weekend.”

Tweet: “Coalition official tells me after Turkish bombing near US base Mashtenour hill: “They know we are there, we told them our position. There’s no other target in the area. They’re trying to drive us out. If Turkey can get us to leave so they can siege Kobane, it’s all over.”

• Turkey Attacks US Special Forces In Syria (NW)

A contingent of U.S. Special Forces was caught up in Turkish shelling against U.S.-backed Kurdish positions in northern Syria, days after President Donald Trump told his Turkish counterpart he would withdraw U.S. troops from certain positions in the area. A senior Pentagon official said shelling by the Turkish forces was so heavy that the U.S. personnel considered firing back in self-defense. Newsweek has learned through both an Iraqi Kurdish intelligence official and the senior Pentagon official that Special Forces operating on Mashtenour hill in the majority-Kurdish city of Kobani fell under artillery fire from Turkish forces conducting their so-called “Operation Peace Spring” against Kurdish fighters backed by the U.S. but considered terrorist organizations by Turkey. No injuries have been reported.

Instead of returning fire, the Special Forces withdrew once the shelling had ceased. Newsweek previously reported Wednesday that the current rules of engagement for U.S. forces continue to be centered around self-defense and that no order has been issued by the Pentagon for a complete withdrawal from Syria. The Pentagon official said that Turkish forces should be aware of U.S. positions “down to the grid.” The official could not specify the exact number of personnel present, but indicated they were “small numbers below company level,” so somewhere between 15 and 100 troops. Newsweek has reached out to the Pentagon for comment on the situation.

This will build.

• US Lawmakers Press Again For Stronger Trump Action On Turkey (R.)

U.S. lawmakers introduced more legislation on Friday seeking to slap stiff sanctions on Turkey over its offensive against Kurdish fighters in Syria, underscoring unhappiness from both Democrats and President Donald Trump’s fellow Republicans in Congress over his Syria policy. Representatives Eliot Engel, the Democratic chairman of the U.S. House of Representatives Foreign Affairs Committee, and Mike McCaul, the committee’s ranking Republican, introduced a bill that would sanction Turkish officials involved in the Syria operation and banks involved with Turkey’s defense sector until Turkey ends military operations in Syria. It also would stop arms from going to Turkish forces in Syria, and require the administration to impose existing sanctions on Turkey for its purchase of a Russian S-400 missile-defense system.

On Sunday, Trump abruptly shifted policy and said he was withdrawing U.S. forces from northeastern Syria, clearing the way for Turkey to launch an assault across the border. Turkey began the offensive quickly, pounding Kurdish militias, who had spent many months fighting alongside U.S. forces against Islamic State militants. Earlier, Engel and McCaul had introduced a resolution expressing strong support for Kurdish forces in Syria and recognizing their contribution to the fight against Islamic State. It also called on Turkey to immediately stop military action in northeast Syria and called on the United States to stand with Syrian Kurdish communities affected by violence.

“The nation has been too preoccupied with political mud-wrestling to notice that the US debt has gone hockey-stick parabolic..”

• In Memoriam: Reality (Kunstler)

The Golden Golem of Greatness shifted into mad bull overdrive for last night’s Minneapolis fan rally, cussing and bellowing at the picadors of the Left who have been sticking lances in his neck for three years. Decorum is not Mr. Trump’s strong suit, but then the bull is not sent into the ring to negotiate politely for his life. The narrative of the bullring is certain death. The bull must do what he can within his nature to dispute it. It’s in Mr. Trump’s nature to act the part of a reality TV star, and, of course, it is the nature of reality TV shows to be unreal. That is perhaps the ruling paradox of life in the USA these days.

Saturated in unreality, the spectators (also called “voters”) flounder through a relentless barrage of narratives aimed at confounding them, with the unreal expectation that they can make sense of unreal things. In a place like Minneapolis of an October evening, you can go see the Joker movie or take in the President’s rally — and come away with the same sense of hyper-unreality. We’re no longer the nation we pretend to be and we don’t know it. Jokers are wild and the joke’s on us. So it goes in these dangerous autumn days of The Fourth Turning. Something’s got to give, and all indications are it will happen where few are looking at the moment: the sideshow of money and banking.

When things start slip-sliding away over in that alternative universe, Mr. Trump will be propelled into the role he was cast for in 2016: bag-holder for economic collapse. The global slowdown of productive activity and commerce is undermining a vast network of dubious financial obligations ruled by an overgrowth of loans that will never be paid back. Unlike New York real estate moguls, the whole world can’t just go into bankruptcy court and apply for a fresh start. The “workout” is brutal and produces epoch-defining trauma. The nation has been too preoccupied with political mud-wrestling to notice that the US debt has gone hockey-stick parabolic, racking up $814 billion just since August. Math majors may see that’s close to a trillion dollars, or 4 percent of the total $22,837 trillion, just in a few months.

“..to strengthen the company’s governance and safety management processes,” the company said.”

• Boeing Board Strips CEO Of Chairman Title Amid 737 MAX Crisis (R.)

Boeing Co’s board has stripped chief executive Dennis Muilenburg of his chairmanship title, in an unexpected strategy shift announced by the U.S. planemaker on Friday only hours after a global aviation panel criticized development of the troubled 737 MAX. Separating the roles, which will enable Muilenburg to have “maximum focus” on steering daily operations, was the latest step the board has taken in recent weeks to improve executive oversight of its engineering ranks and industrial operations. Lead Director David Calhoun, a senior managing director at Blackstone Group, will takeover as non-executive chairman, Boeing said in its announcement, which came late on Friday afternoon without warning.

It added that the board had “full confidence” in Muilenburg, who will retain the top job and remain on the board. The decision came as Boeing struggles to get its best-selling 737 MAX back into service following a worldwide safety ban in March triggered by two crashes that killed a total of 346 people in Ethiopia and Indonesia. It also comes some six months after Muilenburg survived a shareholder motion to split his chairman and CEO roles, part of the intense pressure he has faced during the worst crisis of his four years at the helm of the world’s largest planemaker. “This decision is the latest of several actions by the board of directors and Boeing senior leadership to strengthen the company’s governance and safety management processes,” the company said.

I said last week that Paypal wouldn’t be the only one.

• Facebook’s Libra Currency Abandoned By Major Financial Companies (R.)

Facebook Inc’s ambitious efforts to establish a global digital currency called Libra suffered severe setbacks on Friday, as major payment companies including Mastercard and Visa Inc quit the group behind the project. The two companies announced they would leave the association Friday afternoon, as did EBay Inc, Stripe Inc. and Latin American payments company Mercado Pago. They join PayPal Holdings Inc which exited the group a week ago, as global regulators continue to air concerns about the project. The latest exodus leaves the Libra Association without any remaining major payments companies as members, meaning it can no longer count on a global player to help consumers turn their currency into Libra and facilitate transactions.

The remaining association members, including Lyft and Vodafone, consist mainly of venture capital, telecommunications, blockchain and technology companies, as well as nonprofit groups. “Visa has decided not to join the Libra Association at this time,” the company said in a statement. “We will continue to evaluate and our ultimate decision will be determined by a number of factors, including the Association’s ability to fully satisfy all requisite regulatory expectations.” Facebook’s head of the project, former PayPal executive David Marcus, cautioned on Twitter against “reading the fate of Libra into this update,” although he acknowledged “it’s not great news in the short term.”

Libra, Grams, who’s next?

• US SEC Halts Telegram’s $1.7 Billion Digital Token Offering (R.)

U.S. authorities said on Friday they have halted a $1.7 billion unregistered digital token offering by the messaging service Telegram Group Inc and its TON Issuer subsidiary. The Securities and Exchange Commission said it had received a temporary restraining order against the two offshore entities, which the regulator said had failed to register to sell 2.9 billion digital tokens called “Grams” to initial investors globally, including 1 billion to U.S. buyers. The move marks the latest effort by the agency to crack down on the fledgling cryptocurrency industry.

The SEC has taken the position that initial coin offerings are securities offerings and therefore subject to SEC offering rules, which require firms to file registration and disclosure documents. “Our emergency action today is intended to prevent Telegram from flooding the U.S. markets with digital tokens that we allege were unlawfully sold,” Stephanie Avakian, co-director of the SEC’s Division of Enforcement, said in a statement.

You’re going to wish your cities weren’t designed to make cars a necessity.

• Rising Used Car Prices Help Push Poor Americans Over The Edge (R.)

For America’s working poor, an often essential ingredient for getting and keeping a job – having a car – has rarely been more costly, and millions of people are finding it impossible to keep up with payments despite prolonged economic growth and low unemployment. More than 7 million Americans are already 90 or more days behind on their car loans, according to the New York Federal Reserve, and serious delinquency rates among borrowers with the lowest credit scores have by far seen the fastest acceleration. The seeds of the problem are buried deep in the financial crisis, when in the midst of the worst economic downturn since the Great Depression, automakers slashed production.

A decade later, that has made a relative rarity of used 10-year-old vehicles that are typically more affordable for low-wage earners. According to data provided to Reuters by industry consultant and car shopping website Edmunds, the average price of that vintage of vehicle is $8,657, still nearly 75% higher than in 2010 despite some softening in prices over the last year. The average new car, in contrast, has seen a price rise of 25% in that same time period. “This is pinching people at the worst point possible,” said Ivan Drury, Edmunds’ senior manager of industry analysis. “If you need basic A to B transportation, you have to get an older car that needs more repairs and has more wear-and-tear issues.”

War crimes.

• Saudi Naval Blockade Sparks Fresh Humanitarian Crisis in Yemen (MPN)

Recent political developments have offered a glimmer of hope to some that the end of the humanitarian crisis in Yemen may be near. But a new report by the United Nations Development Programme shows that a recent tightening of the Saudi-led Coalition’s blockade against the country, and the fuel shortages it has sparked, not only are exacerbating Yemen’s humanitarian crisis but also are slated to make Yemen the world’s poorest country by 2022. In the nursery at the Maternity and Childhood Hospital in Amran, doctors and families alike fear that fuel shortages will lead to power cuts, plunging the ward into darkness and rendering its life-saving machines inoperable.

One mother in the ward diligently watches a heater placed near her infant, knowing that it the electricity-powered medical device stops, her child will die. Dr. Hadi Al-Hamzi, the director-general of the hospital, said that 30 infants could die if their incubators stop for just two hours. He added, “We have a severe shortage of generator fuel, and we have no prospect of getting more in the coming days.” Mohammed Mujahed, the director of Amran Governorate’s Health Office, warned that intensive care for pregnant mothers and nurseries in the province could be stopped in a matter of hours if no generator fuel is secured.

The Saudi-led Coalition has stepped up its seizure and detention of ships carrying food and fuel into Yemen and the effects of those seizures are already being felt by ordinary people. Thousands of Yemenis already facing acute food shortages could die, as stocks of stored food dwindle and cannot be replenished. Sultana Begum, a representative of the Norwegian Refugee Council humanitarian organization, told Reuters that “fuel shortages in Yemen exacerbate the already dire humanitarian situation in the country and lead to unacceptable levels of suffering.”

“..nearly 4 million Yemenis are currently stranded abroad..”

• Human, Organ Trafficking Booming in Yemen as War Enters its Fifth Year (MPN)

In addition to poverty and the absence of law enforcement, there are other reasons why human trafficking flourishes in Yemen, perhaps the most prominent being the blockade levied against the country by the Saudi Coalition since 2015. Before the war, Yemenis would regularly leave the country to seek better health care, employment opportunities and safety abroad — including, somewhat ironically, in neighboring Saudi Arabia. Now — with seaports, airports, highways and especially the once-bustling Sana`a International Airport effectively shuttered by the Saudi Coalition — Yemenis are no longer able to flee the violence in their country or travel to neighboring wealthy Gulf countries for stints of work to earn some cash, leaving many with few options but to resort to selling their organs out of desperation to make ends meet.

The blockade has also left a large number of Yemenis stranded abroad, including some students and others who have managed to find a way out in hopes of receiving medical treatment. It is estimated, according to data provided by the Sana`a International Airport Media Center, that nearly 4 million Yemenis are currently stranded abroad. Many of the stranded are left in a state of legal limbo, unable to secure citizenship in neighboring countries and therefore unable to work, leaving them with no way to earn money short of begging on the street or agreeing to sell their organs. The Yemen Organisation for Combating Human Trafficking told MintPress that many Yemenis who fled when the war broke out are now stuck abroad and that the organization has recorded as many as 300 cases of Yemenis stranded abroad selling their kidneys out of desperation.

Emmy B on Twitter: “At Westminster Magistrates Court today we saw Julian #Assange via video link. We saw his further physical deterioration. He only said his name and DOB responding at the request of the Magistrate and remained speechless and motionless to the end. Hearing did not last more than 10’”

• Julian Assange To Remain Locked Up In UK Prison (RT)

WikiLeaks co-founder Julian Assange has been ordered to stay in a British prison ahead of a hearing on his possible extradition to the United States, despite reaching the end of his custody period. Assange was due to be released on September 22 after serving a sentence for breaching bail conditions by seeking refuge in the Ecuadorian Embassy in London in 2012. The 48-year-old was told at a court hearing last month that he would be kept in Belmarsh prison because of “substantial grounds” for believing he would abscond. At a brief hearing at Westminster Magistrates’ Court on Friday, deputy senior district judge Tan Ikram said that Assange would remain in custody “for the same reasons as before.”

Assange spoke only to confirm his name and age before he was remanded in prison. He is due to appear in court in person at his next hearing on October 21. “I very much hope we can make some progress on this case,” Judge Ikram told him at the end of the five-minute hearing, Reuters reports. In the US, Assange is charged with possession and dissemination of classified information. If found guilty, he could receive up to 175 years in prison. The activist has long feared that the US would attempt to extradite him after WikiLeaks published the leaked ‘Collateral Murder’ video, which shows the US military attacking journalists and civilians in Iraq in July 2007.

Autumn pedestrian crossing in Yekaterinburg, Russia.

Debt Rattle October 11 2019

Oct 112019

October 11, 2019 Posted by Raúl Ilargi Meijer at 9:57 am Finance Tagged with: Bezos, Deutsche, Facebook, Fed, GM, impeachment, implosion, ISIS, Kurds, QE, tanker, Turkey 10 Responses »

Balthus Girl at a window 1957

• How the Crybabies on Wall Street Try to Force the Fed into QE-4 (WS)

• After Unveiling ‘NotQE’, Fed Eases Liquidity Rules For Foreign Banks (ZH)

• America’s Political Implosion (SCF)

• Dems Weigh Knee-Capping A Republican Impeachment Criticism (Pol.)

• US House Republicans To Seek Sanctions On Turkey Over Kurd Offensive (R.)

• Syrian Kurdish Leaders Urge EU To Pull Envoys Over Turkey Offensive (RT)

• Explosions Rock Iranian Tanker Near Saudi Port City Of Jeddah (RT)

• GM’s Third-Quarter China Vehicle Sales Down 17.5% (R.)

• What Jeff Bezos Wants (Atl.)

• Facebook Paid Just £28m Tax On Record £1.6bn Earnings In UK (G.)

2 stories I couldn’t find decent pieces on: new hopes for a Brexit deal, and Giuliani’s ‘associates’ arrested. I was wondering why they were labeled his ‘associates’, but all I could find is they were ’associated’ with him. Right. Now, I always found Rudy a weird character, but these stories simply become part of the entire load of anti-Trump tales we’re doused in every day. It becomes impossible to judge what is real or not.

Meanwhile, while you weren’t looking, the Fed is busy saving Wall Street again. Got to rescue them bonuses.

• How the Crybabies on Wall Street Try to Force the Fed into QE-4 (WS)

Fed Chair Jerome Powell’s explanation on Tuesday and the FOMC minutes released yesterday were a bitter disappointment for the Crybabies on Wall Street – the broker-dealers and banks: They’d expected a massive bout of QE, and perhaps some of the players had gleefully contributed to, or even instigated the turmoil in the repo market to make sure they would get that massive bout of QE as the Fed would be forced to calm the waters with QE, the theory went. This QE would include big purchases of long-term securities to push down long-term yields, and drive up the prices of those bonds these Crybabies are holding or have bet on with derivatives.

This is particularly crucial to the “primary dealers” – the 24 US and foreign broker-dealers and banks that are authorized to deal directly with the US Treasury and the New York Fed. They’ve been hoarding Treasury securities with longer maturities. As of October 2, according to the most recent data from the New York Fed, they hoarded $161 billion, double the $81 billion a year ago – though that has come down from the peak in July of $219 billion. Note the top two lines (black): Less than two-year maturities amounting to $74 billion; and 11-year and over maturities amounting to $37 billion. Not included on this chart are the primary dealers’ holdings of Treasury bills, TIPS, Agency securities, and Floating Rate Notes.

Primary dealers are funding their hoard in the repo market. These funding needs were putting pressures on the repo market, the Fed already said in its minutes for the July meeting, before repo rates totally blew out in mid-September. But primary dealers could have sold a large part of those securities, if they’d wanted to. Prices were high and yields were low, a sign that there was heavy demand. But the dealers were holding out for even higher prices and even lower yields. And any heavy selling could have pushed up those yields and steepened the yield curve, very unpalatable for folks clamoring for rate cuts. So these dealers are sitting on a pile of Treasury notes and bonds whose prices they want to rise, and therefore their yields would have to fall. Massive QE, where the Fed buys these types of Treasury securities, would accomplish that.

Why would the banks not risk going broke? They’ll be saved no matter what.

• After Unveiling ‘NotQE’, Fed Eases Liquidity Rules For Foreign Banks (ZH)

Having cracked down on Deutsche Bank in the past, The Fed appears to be playing good-regulator/bad-regulator as The FT reports that Deutsche is expected to benefit most from an imminent change in The Fed’s liquidity rules. Specifically, US banking regulators have dropped an idea to subject local branches of foreign banks to tough new liquidity rules (forcing US branches of foreign banks to hold a minimum level of liquid assets to protect them from a cash crunch). As The FT further details, people familiar with his thinking say Randal Quarles, the vice-chair for banking supervision at the Fed, accepts the banks’ argument that any liquidity rules on bank branches should only be imposed in conjunction with foreign regulators.

“Without some international agreement, we could have the situation where each country is trying to grab whatever isn’t nailed down if there is another scare.” And Deutsche Bank benefits most (or rescued from major liquidity needs) since it has by far the largest assets in US branches… Why would The Fed do this? Simple, it cannot afford another Lehman-like move (or even the fear of one)…

The whole enchilada is under threat. Time to leave the partisan trenches.

• America’s Political Implosion (SCF)

The polarization in American politics has become so extreme there seems no longer to be any center ground. The political establishment is consequently imploding into an abyss of its own making. President Trump is being driven into an impeachment process by Democrats and their media supporters who accuse him of being “unpatriotic” and a danger to national security. Trump and Republicans hit back at Democrats and the “deep state” whom they condemn for conspiring to overthrow the presidency in a coup dressed up as “impeachment”. The White House is being subpoenaed, the Democrat-controlled House of Representatives wants to access transcripts to all of Trump’s phone calls to foreign leaders; Secretary of State Mike Pompeo has blasted congressmen for “harassing the State Department” in their search of evidence to indict Trump.

Trump calls the impeachment bid a “witch-hunt”. Republican Representatives protest that the US is facing a dark day of constitutional crisis, whereby opposing Democratic party leaders are abusing their office by accusing Trump of “high crimes” without ever presenting evidence. It’s an Alice in Wonderland scenario writ large, where the gravest verdict is being cast before evidence is presented, never mind proven; the president is guilty until proven innocent. Trump, in his turn, has berated senior Democrat Adam Schiff, the chair of the House Intelligence Committee, for “treason” – a capital offense. Are federal police obliged to arrest him? Schiff is accused of colluding with a supposed CIA whistleblower in concocting the complaint that Trump tried to extort Ukrainian President Volodymyr Zelensky to dig dirt on Democratic presidential candidate Joe Biden.

There seems no end to this political civil war in the US. The American political class is literally tearing itself apart, destroying its ability to govern with any normal function. So-called liberal media outlets, in lockstep with the Democrats, inculpate Trump for wrongdoing, while they staunchly assert that credible reports of Joe Biden abusing his former vice presidential office to enrich his son over Ukraine gas business are false. Many Americans don’t see it that way. They see Biden as being up to his neck in past corruption; they also see a flagrant double-standard of the establishment protecting Biden from investigation while hounding Trump at every possible opportunity, even when evidence against Trump is scant.

Curious way to phrase holding a simple vote.

• Dems Weigh Knee-Capping A Republican Impeachment Criticism (Pol.)

House Democrats are grappling with whether to take more steps to formalize their impeachment inquiry and silence a chief Republican criticism of their efforts, with competing factions beginning to emerge. President Donald Trump and his allies on Capitol Hill have hammered Speaker Nancy Pelosi for not holding a vote authorizing the House’s impeachment proceedings — arguing that without a vote, the entire process is illegitimate. Pelosi has refused to cave, dismissing Trump’s demand last week and insisting it is not required under the Constitution or House rules. And allies close to the speaker say her position hasn’t changed, describing the idea as the latest “Republican canard” in a series of stall tactics the GOP will employ to protect Trump.

“It is one act after another of obstruction of justice by the White House, by the State Department, and by the attorney general. And I say, give them more rope to hang themselves,” Rep. Harley Rouda (D-Calif.), who flipped his conservative Orange County district in 2018, said in an interview. Yet some Democratic lawmakers and aides have begun to say privately — and, to a lesser extent, publicly — that the House should just vote to formalize the inquiry, robbing the GOP of its main talking point. The debate is threatening to cleave Democrats’ unified front as the White House makes the arcane procedural arguments the centerpiece of its impeachment defense. “If Nancy asked me, I would say sure, let’s have a vote. Everybody’s on record, so they’re not going to vote any differently. What’s the danger in having a vote to formalize it?” said Rep. John Yarmuth (D-Ky.), an early impeachment backer.

But the suggestion has provoked strong objections from some of their colleagues who say they would be abdicating their authority if lawmakers permit other branches of government to dictate their procedures. “If we allow that to happen, Congress would be completely dysfunctional,” Rep. Sean Casten (D-Ill.) said at a recent town hall event in Glen Ellyn, Ill. “If we have to take a complete show vote, we’ll get the vote. But I find it offensive that they are basically telling us how to do our job with a misreading of the Constitution. Read the freakin’ Constitution. And then let’s honor our oath to it.”

Will the Democrats support this?

• US House Republicans To Seek Sanctions On Turkey Over Kurd Offensive (R.)

Twenty-nine of President Donald Trump’s fellow Republicans in the U.S. House of Representatives announced on Thursday they would introduce legislation to impose sanctions against Turkey, underscoring lawmakers unhappiness about its assault on Kurdish forces in Syria. A day after Republicans and Democrats announced similar legislation in the Senate, the lawmakers – including Republican Leader Kevin McCarthy, Republican Whip Steve Scalise and other party leaders – said they wanted a strong response to Ankara’s aggression. “President (Recep Tayyip) Erdogan and his regime must face serious consequences for mercilessly attacking our Kurdish allies in northern Syria,” Republican Representative Liz Cheney, chairwoman of the House Republican Conference, said in a statement.

It was not immediately clear how the legislation would fare in the House of Representatives, which is controlled by Democrats. On Sunday, Trump abruptly shifted policy and said he was withdrawing U.S. forces from northeastern Syria, clearing the way for Turkey to launch an assault across the border. Turkey began the offensive quickly, pounding Kurdish militias, who recently were fighting alongside U.S. forces against Islamic State militants, on Wednesday and Thursday, killing dozens and forcing many thousands of people to flee.

Erdogan has threatend to release 3.6 million refugees into Europe, so don’t hold your breath for this one.

• Syrian Kurdish Leaders Urge EU To Pull Envoys Over Turkey Offensive (RT)

Kurdish leaders have called on European countries to withdraw their ambassadors from Turkey in protest at Ankara’s military operation against their forces in northern Syria. A delegation from the Syrian Democratic Council (SDC) – the political wing of the Syrian Democratic Forces (SDF) – traveled to Brussels on Thursday to urge the EU to take concrete measures to punish Turkey, AFP reports. “We want an urgent intervention on this crisis, and these attacks should be stopped quickly. Air space should be closed for Turkish flights so that air attacks can be stopped,” senior SDC figure Ilham Ahmed said in Brussels. “All European states should freeze their relations by withdrawing their ambassadors from Turkey immediately.” The EU has urged Turkey to halt the assault but has not taken any action. The bloc’s foreign ministers will discuss the crisis at a regular meeting on Monday.

Oh, lovely.

• Explosions Rock Iranian Tanker Near Saudi Port City Of Jeddah (RT)

A tanker belonging to Iran’s government-owned oil corporation has been hit by two missiles and caught fire in the Red Sea, 60 miles from Saudi shores. The incident is being treated as a terrorist attack, local media says.
The tanker Sinopa, operated by the National Iranian Oil Company (NIOC), was sailing through the Red Sea when the explosion occurred. The blast was powerful enough to damage two of its reservoirs, leading to an oil spill in the area. Local media cited unnamed Iranian “technical experts” who believe that the incident could have been caused by a “terrorist attack,” but didn’t provide any evidence to back the claim.

The tanker’s crew wasn’t hurt in the incident, which took place near Jeddah, the largest port in the Red Sea and maritime gateway to Saudi Arabia. NIOC, which once ranked second after Saudi Aramco in terms of crude oil extraction, told state-run IRNA news agency that the vessel was hit by what appears to be two missiles. That report did not expand on where the attack came from.

Small is beautiful.

• GM’s Third-Quarter China Vehicle Sales Down 17.5% (R.)

General Motors Co’s July to September vehicle sales in China fell 17.5%, as the U.S. automaker was hurt by a slowing economy amid the Sino-U.S. trade war and by heightened competition in its key mid-priced SUV segment. GM delivered 689,531 vehicles in China in the third quarter this year, according to a company statement. The drop for the quarter ended September 30 marks the fifth straight quarterly sales decline for GM in China, the world’s biggest auto market. It delivered 2.26 million vehicles in the first nine months this year, according to Reuters calculation.

As GM and Ford Motor Co’s China sales extend declines, U.S. car companies’ share of total China passenger vehicles sales fell to 9.5% in the first eight months of this year from 10.7% in the year-ago period, according to the China Association of Automobile Manufacturers (CAAM). Over the same period, German car makers’ share has risen to 23.8% from 21.6% and Japanese auto makers’ to 21.7% from 18.3%.

Wasn’t he the guy who wants to live on the moon?

• What Jeff Bezos Wants (Atl.)

Where in the pantheon of American commercial titans does Jeffrey Bezos belong? Andrew Carnegie’s hearths forged the steel that became the skeleton of the railroad and the city. John D. Rockefeller refined 90 percent of American oil, which supplied the pre-electric nation with light. Bill Gates created a program that was considered a prerequisite for turning on a computer. At 55, Bezos has never dominated a major market as thoroughly as any of these forebears, and while he is presently the richest man on the planet, he has less wealth than Gates did at his zenith. Yet Rockefeller largely contented himself with oil wells, pump stations, and railcars; Gates’s fortune depended on an operating system. The scope of the empire the founder and CEO of Amazon has built is wider. Indeed, it is without precedent in the long history of American capitalism.

Today, Bezos controls nearly 40 percent of all e-commerce in the United States. More product searches are conducted on Amazon than on Google, which has allowed Bezos to build an advertising business as valuable as the entirety of IBM. One estimate has Amazon Web Services controlling almost half of the cloud-computing industry—institutions as varied as General Electric, Unilever, and even the CIA rely on its servers. Forty-two percent of paper book sales and a third of the market for streaming video are controlled by the company; Twitch, its video platform popular among gamers, attracts 15 million users a day. Add The Washington Post to this portfolio and Bezos is, at a minimum, a rival to the likes of Disney’s Bob Iger or the suits at AT&T, and arguably the most powerful man in American culture.

“Profits on social media app surged by more than 50% to £797m in latest tax year..”

• Facebook Paid Just £28m Tax On Record £1.6bn Earnings In UK (G.)

Facebook’s UK operations paid £28m in tax last year despite attracting a record £1.6bn in British sales. The social media company’s latest UK accounts show that gross income from advertisers rose almost 30% last year to £1.65bn, and pretax profits surged by more than 50% from £63m to £97m. Facebook UK said the net revenues it made from advertisers rose 50% last year to £797m, meaning 12% of its sales were converted to profits. This falls far short of the company’s overall performance – last year Facebook made $25bn (£19.7bn) of profit on total sales of $55.8bn – meaning it converted 44% of its sales into profits.

Facebook’s UK operation expanded rapidly last year with staff numbers rising by more than 50%, from 1,290 to 1,965 year on year, with a total staff wages and pension bill of £431m. The company’s UK office provides marketing services and sales and engineering support to other parts of the company. Facebook said it spent £356m on research, development and engineering in the UK last year. Last month, online retail giant Amazon came under fire for paying just £14.7m in UK corporation tax last year, despite reporting sales of £2.3bn. Earlier this month, Netflix UK’s accounts showed that the streaming giant received a €57,000 (£51,000) tax rebate from the UK government last year, despite making an estimated £700m from British subscribers bingeing on fare from The Crown to Stranger Things.

A baby Grauer’s gorilla, a critically endangered species, in the forest of Kahuzi-Biega National Park in the Democratic Republic of Congo. In 2018, logging began in the protected area, threatening the habitat of the gorillas.

Debt Rattle July 19 2019

Jul 192019

July 19, 2019 Posted by Raúl Ilargi Meijer at 9:21 am Finance Tagged with: Boeing, China, drone, Epstein, Iran, Omar, Puerto Rico, Red List, SWIFT, Trump, Turkey 10 Responses »

Pablo Picasso Marie-Thérèse Walter 1937

• Trump Denounces ‘Send Her Back’ Chant About Rep. Ilhan Omar (BI)

• US Navy Ship ‘Destroyed’ An Iranian Drone – Trump (CNN)

• Iran Deputy Foreign Minister Says Tehran Has Not Lost Any Drones (R.)

• Rand Paul Angles To Become Trump’s Emissary To Iran (Pol.)

• Manhattan and DC Brace For Epstein Impact (VF)

• Beijing’s Credibility and the Baoshang Bank Dilemma (RG)

• Obscure Data Suggests China Housing Bubble Has Burst (ZH)

• Boeing Takes $4.9 Billion Charge As 737 Max Fiasco Drags On (ZH)

• Congress Must Not Cede Its Authority To Raise Debt (Hill)

• Russia Offers To Join European SWIFT-Bypass (ZH)

• More Puerto Rico Protests Planned As Governor Resists Calls To Resign (R.)

• US Lawmakers Urge Trump To Sanction Turkey (R.)

• Cyprus: American Promises, Turkish Arms, Russian Money And Missiles (Helmer)

• Merger Mania: the Military-Industrial Complex on Steroids (Hartung)

• IUCN Red List Reveals Wildlife Destruction From Treetop To Ocean Floor (G.)

Of course people will see he didn’t really denounce it, or not fast enough or strong enough, but he did say it. Whatever you think of this, Trump got what he wanted: the Dems have moved hugely to the left. And he thinks they’re much easier to defeat in elections now. They can pick Biden or Kamala, but from now on in, it’ll be: yes but what do AOC and Omar think?

• Trump Denounces ‘Send Her Back’ Chant About Rep. Ilhan Omar (BI)

President Donald Trump is distancing himself from attendees at his North Carolina rally on Wednesday who chanted about “send her back” Rep. Ilhan Omar, a US citizen who has been a strident Trump critic. In the Oval Office on Thursday, Trump said he “disagreed” with the chants, was “very unhappy” with them, and would try to stop them in the future. Omar came to America as a refugee from Somalia in the 1990s, and is a US citizen. At the rally, Trump went on an extended monologue criticizing Omar and falsely linking her to terrorism and accusing her of supporting al-Qaeda, drawing loud boos from the audience. The crowd broke into “send her back” chants after Trump accused her of “launching vicious, anti-Semitic screeds.” But if Trump was unhappy with the chants, he didn’t show it.

But have they?

• US Navy Ship ‘Destroyed’ An Iranian Drone – Trump (CNN)

President Donald Trump said Thursday that the USS Boxer downed an Iranian drone that came within 1,000 yards of the Navy ship and ignored “multiple calls to stand down” — marking yet another escalation in the already tense situation playing out between Washington and Tehran. Speaking at the White House, Trump said the drone was “threatening the safety of the ship and the ship’s crew” in the Strait of Hormuz and was “immediately destroyed.” The drone was destroyed using electronic jamming, according to a US defense official. The crew of the Boxer took defensive action after the drone came within a threatening distance of the US ship, the official said.

“This is the latest of many provocative and hostile actions by Iran against vessels operating in international waters,” Trump added. “The United States reserves the right to defend our personnel, our facilities and interest and calls upon all nations to condemn Iran’s attempts to disrupt freedom of navigation and global commerce.” He called on other countries to condemn Iran’s action and protect their own vessels.

“I am worried that USS Boxer has shot down their own UAS [Unmanned Aerial System] by mistake!..”

• Iran Deputy Foreign Minister Says Tehran Has Not Lost Any Drones (R.)

Iranian Deputy Foreign Minister Abbas Araqchi denied on Friday that Iran had lost a drone in the Strait of Hormuz after the United States said that a U.S. Navy ship had “destroyed” an Iranian drone. “We have not lost any drone in the Strait of Hormuz nor anywhere else. I am worried that USS Boxer has shot down their own UAS [Unmanned Aerial System] by mistake!,” Araqchi said on Twitter, referring to a U.S. warship in the strategic waterway. U.S. President Donald Trump said on Thursday that the drone had flown to within 1,000 yards (meters) of the USS Boxer and had ignored “multiple calls to stand down” in the latest episode to stir tensions in the Gulf.

Much better than Bolton or Pompeo.

• Rand Paul Angles To Become Trump’s Emissary To Iran (Pol.)

Over a round of golf this past weekend, Sen. Rand Paul asked President Donald Trump’s blessing for a sensitive diplomatic mission. Paul proposed sitting down with Iranian Foreign Minister Javad Zarif to extend a fresh olive branch on the president’s behalf, according to four U.S. officials. The aim: to reduce tensions between the two countries. Trump signed off on the idea. With Zarif in New York City this week for U.N. meetings and private sitdowns with journalists and think-tank experts, the prospect of the dovish Kentucky senator serving as the administration’s chief diplomatic emissary has rankled many administration officials, who are expressing concern that Paul’s intervention threatens to scuttle the president’s “maximum pressure” campaign against Tehran.

It is unclear whether the senator will meet with Zarif. He and his office declined multiple requests for comment. But the president’s willingness to tap Paul as the go-between with a top Iranian official is a demonstration both of his unorthodox approach to foreign affairs and his continuing desire, even as his aides threaten to squeeze Iran until it capitulates to U.S. demands, to entice the Islamic Republic’s leaders to the negotiating table. Trump has been attempting to start negotiations with Iran for months, a campaign that has included letters to Supreme Leader Ayatollah Ali Khamenei, an attempt to use Japanese Prime Minister Shinzo Abe as an emissary to Tehran, and public comments expressing his desire to talk. Some Iranian officials have said that they are open to negotiations, but only after the administration removes sanctions. Khamenei, however, has likened talking with the U.S. to drinking “poison.”

Paul, along with Sens. Lindsey Graham (R-S.C.) and David Perdue (R-Ga.), played a round of golf with the president on Saturday at his club in Sterling, Va. The libertarian-leaning Paul has long been wary of U.S. foreign intervention, and he’s clashed with Trump administration officials over the possibility of a military conflict with Iran. When Trump last month called off retaliatory military strikes against Iran after an Iranian military official downed a U.S. drone over international waters, Paul went on the president’s favorite television network to offer unqualified praise. “It really takes a statesman to show restraint amidst a chorus of voices for war,” Paul told Fox News’ Martha MacCallum.

How wise is Epstein’s web?

• Manhattan and DC Brace For Epstein Impact (VF)

The Jeffrey Epstein case is an asteroid poised to strike the elite world in which he moved. No one can yet say precisely how large it is. But as the number of women who’ve accused the financier (at least, that’s what he claimed to be) of sexual assault grows to grotesque levels—there are said to be more than 50 women who are potential victims—a wave of panic is rippling through Manhattan, DC, and Palm Beach, as Epstein’s former friends and associates rush to distance themselves, while gossiping about who might be ensnared. Donald Trump’s labor secretary, Alexander Acosta, architect of the original 2007 non-prosecution agreement that let Epstein off with a wrist slap, has already been forced to resign.

The questions about Epstein are metastasizing much faster than they can be answered: Who knew what about Epstein’s alleged abuse? How, and from whom, did Epstein get his supposed $500 million fortune? Why did Acosta grant Epstein an outrageously lenient non-prosecution agreement? (And what does it mean that Acosta was reportedly told Epstein “belonged to intelligence”?) But among the most pressing queries is which other famous people might be exposed for committing sex crimes. “There were other business associates of Mr. Epstein’s who engaged in improper sexual misconduct at one or more of his homes. We do know that,” said Brad Edwards, a lawyer for Courtney Wild, one of the Epstein accusers who gave emotional testimony at Epstein’s bail hearing. “In due time the names are going to start coming out.”

Likely within days, the U.S. Court of Appeals for the Second Circuit will release almost 2,000 pages of documents that could reveal sexual abuse by “numerous prominent American politicians, powerful business executives, foreign presidents, a well-known prime minister, and other world leaders,” according to the three-judge panel’s ruling. The documents were filed during a civil defamation lawsuit brought by Epstein accuser Virginia Roberts Giuffre, a former Mar-a-Lago locker-room attendant, against Epstein’s former girlfriend and alleged madam, Ghislaine Maxwell. “Nobody who was around Epstein a lot is going to have an easy time now. It’s all going to come out,” said Giuffre’s lawyer David Boies. Another person involved with litigation against Epstein told me: “It’s going to be staggering, the amount of names. It’s going to be contagion numbers.”

Free markets? Nah…

• Beijing’s Credibility and the Baoshang Bank Dilemma (RG)

Baoshang Bank’s seizure by regulators on May 24 has created structural liquidity distribution problems in China’s interbank money market, which is vital to the financial system’s overall function. The market’s liquidity chain, with money lent from policy banks and large banks to small banks and then to non-bank financial institutions (NBFIs), remains ruptured, even as the central bank tries to piece it back together. However, authorities did not act capriciously, even if the Baoshang failure seems to have been foisted upon Chinese regulators at an awkward time.

The central bank chose explicitly to impose haircuts or discounts on corporate and interbank Baoshang depositors even while guaranteeing household and small deposits: they did not choose to fully support all depositors. By addressing some systemic risks officials necessarily create new counterparty credit risks: breaking moral hazard is difficult to do. Beijing cannot drive the probability of bank defaults back to zero, nor do they want to. Additional bank defaults have to be possible if system-wide risk taking is to be managed. The dilemma is fundamental: Does Beijing want the market to price the risk of potential bank failures, or do authorities want “stable” production of riskier and riskier forms of credit? Beijing can have one or the other, not both.

Intriguing.

• Obscure Data Suggests China Housing Bubble Has Burst (ZH)

[..] there was a delightful surprise to appease those who are wondering whether record credit injections and more easing measures than during the financial crisis had any effect at all. To wit, China retail sales and industrial production rebounded handsomely with the former spiking 9.8% YoY – the most since March 2018. There’s just one thing though – the entire surge in retail sales (and industrial production) seems to have been triggered by an almost unprecedented sudden surge in auto sales to – who else – the government itself, in the form large, state-owned enterprises. Think Cash for Clunkers on steroids – if the clunkers belonged to the Federal Government, and the new cars purchased were made by the Government.

Yet there was one critical data set in China’s manipulated economic data spreadsheet, which failed to get the royal goalseek treatment, one with dramatic implications for the broader market. According to Commodore Research, Chinese June data showed that furniture sales in China totaled only 18.4 billion yuan last month. This marks a year-on-year decline of 14% from the 21.3 billion yuan in sales that was reported last year for June 2018’s furniture sales. This is puzzling in light of the official Chinese data according to which the local housing market continues to hum along, firing on all cylinders, with the average, 70-city primary market property price rising 10.5% Y/Y in May.

Alas, that does not seem feasible when one considers that furniture sales in China have now contracted on a year-on-year basis for eighteen straight months. What does this mean? As Commodore Research concludes, “we continue to believe that there is a good chance that the ongoing plummet in furniture sales in China is pointing to much greater weakness existing in the Chinese housing market than is generally being recognized.”

So: $100 million for the victims and $5 billion for the airlines. Yeah, makes perfect sense.

• Boeing Takes $4.9 Billion Charge As 737 Max Fiasco Drags On (ZH)

In a long-overdue step that suggests Boeing is eager to put the 737 MAX debacle behind it, the Seattle airplane company announced it would take a $4.9 billion charge in Q2 related to the grounding of the 737 Max aircraft, which represents that troubled aircraft maker’s first estimate of the cost of compensating airlines for schedule disruptions and delays in aircraft deliveries. The charge will result in a $5.6 billion hit to pre-tax earnings when the company reports earnings on July 24, the company said in a statement issued on Thursday. There is just one problem: there is no assurance Boeing’s 737 MAX woes will end in Q2, with media reports suggesting the grounding of the jet may last into 2020.

That scenario is not being contemplated by the world’s largest commercial aircraft manufacturer, which said it assumes regulatory approval will be granted for the Max to return to global skies in the fourth quarter of this year. “This assumption reflects the company’s best estimate at this time, but actual timing of return to service could differ from this estimate,” the company said. To address the possibility of an extended grounding, Boeing said that although the charge equal to $8.74 per share, would be taken in the second quarter, the company said it expects “potential concessions or other considerations” would come “over a number of years”. As the FT notes, “concessions in such circumstances often take the form of price cuts on aircraft orders rather than cash payments.”

History lessons.

• Congress Must Not Cede Its Authority To Raise Debt (Hill)

Last Friday Treasury Secretary Steven Mnuchin asked Congress to increase the debt limit. And so begins another contentious debate. Throughout our nation’s history, Americans have had a love-hate relationship with the national debt. Alexander Hamilton insisted that debt was the price of liberty. Without it, the young country would be unable to protect itself from foreign threats. Yet, throughout much of U.S. history, many Americans regarded debt itself as a threat, to individual freedoms. The ability to raise debt was linked directly to power, and debt issued to finance the nation’s defense was viewed as particularly dangerous—a way to enrich “monied interests” and increase the power of government at the expense of everyone else.

To impede this potential for abuse, the Constitution vested the power to take on debt and regulate currency with the people—through Congress. As a Congressman during the 1790s, James Madison argued that debt and spending were equally important issues and should be debated separately, rather than rolled together in a single bill. Moreover, he felt that to not manage debt would have be an abdication of Congress’s role representing the people. During our nation’s first 130 years, Congress authorized debt as needed to meet the challenges of the day. Government debt financed revenue shortfalls derived from wars, economic recessions or even infrastructure investments. The big difference from modern times is that, back then, once the challenge precipitating the debt was resolved, Congress turned its attention to debt eradication.

President Andrew Jackson believed that repaying debt was a symbol that the nation could sustain independence. After the Civil War, Congress turned to paying off the national debt, which eventually fell from 32 percent of GDP in 1869 to 5 percent in 1916. But America’s aversion to government debt changed throughout the 20th Century. At the forefront of this change were three major developments: the enactment of the first permanent income tax; the creation of the Federal Reserve and the onset of World War I.

As I wrote a few weeks ago, can’t use a reserve currency as a military tool.

• Russia Offers To Join European SWIFT-Bypass (ZH)

Three weeks after a meeting between the countries who singed the Iran nuclear deal, also known as the Joint Comprehensive Plan of Action (JCPOA), which was ditched by US, French, British and German officials said the trade mechanism which was proposed last summer – designed to circumvent both SWIFT as well as US sanctions banning trade with Iran – called Instex, is now operational. And while we await for the White House to threaten Europe with even greater tariffs unless it ends this special purpose vehicle – it already did once back in May when it warned that anyone associated with the SPV could be barred from the U.S. financial system if it goes into effect – a response from the US is now assured, because in the biggest attack on the dollar as a reserve currency to date, on Thursday, Russia signaled its willingness to join the controversial payments channel, and has called on Brussels to expand the new mechanism to cover oil exports, the FT reported.

Moscow’s involvement in the Instex channel would mark a significant step forward in attempts by the EU and Russia to rescue a 2015 Iran nuclear deal that has been unravelling since the Trump administration abandoned it last year. ““Russia is interested in close co-ordination with the European Union on Instex,” the Russian foreign ministry told the Financial Times. “The more countries and continents involved, the more effective will the mechanism be as a whole.” … and the more isolated the US will be as a currency union meant to evade SWIFT and bypass the dollar’s reserve currency status will soon include virtually all relevant and important countries. Only China would be left outstanding; after the rest of the world’s would promptly join.

Wednesday’s protest, the biggest so far, included singer and actor Ricky Martin and reggaeton artist Bad Bunny.

• More Puerto Rico Protests Planned As Governor Resists Calls To Resign (R.)

Massive and at times violent protests in Puerto Rico showed no sign of stopping as labor unions on Thursday organized a Friday march to keep up pressure on the governor to resign, while dozens of guns were stolen in a raid on police firearms center. Thousands of protesters have jammed streets in San Juan since Saturday, calling on Governor Ricardo Rossello to step down after the leak of a raft of controversial and vulgar text messages between him and his closest allies. The scandal comes on the heels of a federal probe into government corruption on the bankrupt island. The guns were stolen from a police station in the coastal city of Guayama, which was vandalized with graffiti calling for the governor to resign or face bullets, according to a Thursday police statement. The FBI was investigating, it said.

The political turmoil comes at a critical stage in the U.S. territory’s bankruptcy. It has also raised concerns with U.S. lawmakers who are weighing the island’s requests for billions of federal dollars for healthcare and for recovery efforts following devastating hurricanes in 2017. “Like never before, all factions of the country agree that Ricardo Rossello has to go,” Juan Cortés, president of the Central Federation of Workers, a public- and private-sector union, said in a statement. Rossello said on Thursday he continued to ask for forgiveness for what he has called “improper” but not illegal acts on his part, while affirming his commitment to remain in office.

He’ll wait.

• US Lawmakers Urge Trump To Sanction Turkey (R.)

Republican and Democratic U.S. lawmakers pressed President Donald Trump on Thursday to impose sanctions on Turkey over its purchase of a Russian missile defence system, saying he should follow a law mandating penalties for doing business with Russia’s military. Republican Senators Rick Scott and Todd Young introduced a resolution calling for sanctions after Ankara began accepting delivery of an advanced Russian missile defence system last week, prompting the White House to announce it was removing Turkey from the F-35 fighter jet programme.

Separately, Senator Bob Menendez, the top Democrat on the Senate Foreign Relations Committee, said removing Turkey from the jet programme was not enough. “The law clearly mandates sanctions penalties for ‘significant transactions’ with the Russian Federation’s defence and intelligence sectors, which would clearly include the delivery of an S-400 system,” he said in an emailed statement. But Trump’s administration has stopped short of imposing sanctions on Turkey, despite the sweeping 2017 sanctions law, known as CAATSA. Trump has not been clear on whether his administration is considering doing so.

And here’s why he’ll wait…

• Cyprus: American Promises, Turkish Arms, Russian Money And Missiles (Helmer)

This week a group of US senators has proposed to leave Turkey in control of the northern part of Cyprus, and force the Greek Cypriots to choose between the US and Russia for the economic and political future of the south of the island. The Senate Foreign Relations Committee agreed by a large bipartisan majority on June 25 to put into law a new Eastern Mediterranean strategy. If the bill is enacted, Cyprus will be required to decide that in exchange for American protection from Turkish military threats, including Russian-made S-400 missiles to be based in southwestern Turkey, the Cyprus Government must not allow Russian naval vessels to dock at Cypriot ports, and should block all Russian money and investments on the island.

At the same time, Greece has been told the US military intends to expand its occupation of Crete around the Souda Bay base; at Larissa Air Force Base, midway between Athens and Thessaloniki; and at other Greek locations. The proposed new law is the most comprehensive plan for American military occupation of Cyprus and Greece since the Greek civil war of the 1950s. The US plan also establishes State Department censorship of the Greek-language media in Cyprus and Greece, and threatens US sanctions against the Orthodox Church bishops of the two countries. Senator Bob Menendez, Democrat of New Jersey, initiated the new policy as an amendment to Senate Bill No. 1102, “to promote security and energy partnerships in the Eastern Mediterranean, and for other purposes.”

Menendez chaired the Foreign Relations Committee until the Republicans won control of the Senate last November. He has made a long record of legislating sanctions against Russia, while he himself has been under FBI investigation for corruption. [..] US policy in the region should be aimed, the Bill declares, at backing the development of the Cyprus offshore gas deposits, as well as future regional pipelines and liquefaction plants, in order to compete against Russian gas supplies to southern Europe. Without naming Turkey, which is currently threatening Cypriot gas exploration at sea with drilling vessels of its own, the Bill claims that Cypriot seabed exploration “must be safeguarded against threats posed by terrorist and extremist groups, including Hezbollah and any other actor in the region.”

The real giant squid.

• Merger Mania: the Military-Industrial Complex on Steroids (Hartung)

Raytheon, already one of the top five U.S. defense contractors, is planning to merge with United Technologies. That company is a major contractor in its own right, producing, among other things, the engine for the F-35 combat aircraft, the most expensive Pentagon weapons program ever. The new firmwill be second only to Lockheed Martin when it comes to consuming your tax dollars — and it may end up even more powerful politically, thanks to President Trump’s fondness for hiring arms industry executives to run the national security state.

Just as Boeing benefited from its former Senior Vice President Patrick Shanahan’s stint as acting secretary of defense, so Raytheon is likely to cash in on the nomination of its former top lobbyist, Mike Esper, as his successor. Esper’s elevation comes shortly after another former Raytheon lobbyist, Charles Faulkner, left the State Department amid charges that he had improperly influenced decisions to sell Raytheon-produced guided bombs to Saudi Arabia for its brutal air war in Yemen. John Rood, third-in-charge at the Pentagon, has worked for both Lockheed Martin and Raytheon, while Ryan McCarthy, Mike Esper’s replacement as secretary of the Army, worked for Lockheed on the F-35, which the Project on Government Oversight (POGO) has determined may never be ready for combat.

[..] Fifty years ago, Wisconsin Senator William Proxmire identified the problem when he noted that: “the movement of high ranking military officers into jobs with defense contractors and the reverse movement of top executives in major defense contractors into high Pentagon jobs is solid evidence of the military-industrial complex in operation. It is a real threat to the public interest because it increases the chances of abuse… How hard a bargain will officers involved in procurement planning or specifications drive when they are one or two years away from retirement and have the example to look at of over 2,000 fellow officers doing well on the outside after retirement?”

You are part of a death cult.

• IUCN Red List Reveals Wildlife Destruction From Treetop To Ocean Floor (G.)

From the tops of trees to the depths of the oceans, humanity’s destruction of wildlife is continuing to drive many species towards extinction, with the latest “red list” showing that a third of all species assessed are under threat. The razing of habitats and hunting for bushmeat has now driven seven primates into decline, while overfishing has pushed two families of extraordinary rays to the brink. Pollution, dams and over-abstraction of freshwater are responsible for serious declines in river wildlife from Mexico to Japan, while illegal logging is ravaging Madagascar’s rosewoods, and disease is decimating the American elm.

The red list, produced by the International Union for Conservation of Nature (IUCN), is the most authoritative assessment of the status of species. The list published on Thursday adds almost 9,000 new species, bringing the total to 105,732, though this is a fraction of the millions of species thought to live on Earth. Not a single species was recorded as having improved in status. A landmark planetary health check published in May concluded that human civilisation was in jeopardy from the accelerating decline of the Earth’s natural life-support systems. Wildlife populations have plunged by 60% since 1970 and plant extinctions are running at a “frightening” rate, according to scientists.

[..] Humanity’s thirst for fresh water, particularly for farming, is having an especially big impact on river and lake wildlife. The red list update reveals that more than half of the freshwater fish in Japan and over a third in Mexico are now threatened with extinction. Recent research found two-thirds of the world’s great rivers no longer flow freely. “The loss of these freshwater fish species would deprive billions of people of a critical source of food and income, and could have knock-on effects on entire ecosystems,” said William Darwall, head of the IUCN freshwater biodiversity unit.

Twitter had restored the Unity4J account that supports Assange. How Pyrrhic is that victory?

Debt Rattle July 18 2019

Jul 182019

July 18, 2019 Posted by Raúl Ilargi Meijer at 9:45 am Finance Tagged with: bubbles, Chelsea Manning, China, Dalio, F35, housing, hush money, impeachment, Minsky, NATO, outflow, paradigm shift, S400, Trump, Turkey 7 Responses »

Mathew Brady Abe Lincoln 1864

• Showdown With Trump Looms As House Votes To Block Arms Sale To Saudi Arabia (AP)

• House Votes Down Democrat’s Bid To Impeach Trump Over Recent Tweets (AP)

• Feds End Investigation Into Trump Org And Hush Money Payments (CNN)

• Foreign Purchases Of US Homes Plunge 36%, Chinese Flee The Market (CNBC)

• New Zealand’s Armour-Plated Housing Bubble (Hickey)

• Extraordinary Collapse In Home Ownership In Sydney And Melbourne (SMH)

• Paradigm Shifts (Ray Dalio)

• Ray Dalio Says Gold Top Investment During Upcoming ‘Paradigm Shift’ (CNBC)

• US Removes Turkey From F-35 Program After S-400 Purchase From Russia (R.)

• Chelsea Manning’s Daily Fines for Grand Jury Resistance Increase to $1000 (SP)

It’s showdowns all the way down. It would be good if they can do this one with a bit more smart. But they’re losing everything so far, so no high hopes. Of course it’s beyond gross to be chanting “send her home” at a rally. But he’s winning it all and they are not. The Democrats need a plan, they need brains, they need to organize.

• Showdown With Trump Looms As House Votes To Block Arms Sale To Saudi Arabia (AP)

Congress is heading for a showdown with President Donald Trump after the House voted to block his administration from selling weapons and aircraft maintenance support to Saudi Arabia. The Democratic-led House on Wednesday passed the first of three resolutions of disapproval, 238-190, with votes on the others to immediately follow. Trump has actively courted an alliance with Riyadh and has pledged to veto the resolutions. The Senate cleared the measures last month, although by margins well short of making them veto proof. Overturning a president’s veto requires a two-thirds majority. The arms package is worth an estimated $8.1 billion and includes precision guided munitions, other bombs, ammunition, and aircraft maintenance support.

Very predictable and therefore very stupid. It’s no time to start fights you can’t possibly win.

• House Votes Down Democrat’s Bid To Impeach Trump Over Recent Tweets (AP)

The House easily killed a maverick Democrat’s effort Wednesday to impeach President Donald Trump for his recent racial insults against lawmakers of color, in a vote that provided an early snapshot of just how divided Democrats are over trying to oust him in the shadow of the 2020 elections. Democrats leaned against the resolution by Texas Rep. Al Green by about a 3-2 margin as the chamber killed the measure 332-95. The vote showed that so far, House Speaker Nancy Pelosi has been successful in her effort to prevent a Democratic stampede toward impeachment before additional evidence is developed that could win over a public that has so far been skeptical about ousting Trump.

Even so, the numbers also showed that the number of Democrats open to impeachment remains substantial. About two dozen more conversions would split the party’s caucus in half over an issue that could potentially dominate next year’s presidential and congressional campaigns. “There’s a lot of grief, from a lot of different quarters,” Green, speaking to reporters after the vote, said of the reaction he’s received from colleagues. “But sometimes you just have to take a stand.” Every voting Republican favored derailing Green’s measure.

Pelosi and other party leaders considered his resolution a premature exercise that needlessly forced vulnerable swing-district lawmakers to cast a perilous and divisive vote. It also risked deepening Democrats’ already raw rift over impeachment, dozens of the party’s most liberal lawmakers itching to oust Trump. Recent polling has shown solid majorities oppose impeachment. Even if the Democratic-run House would vote to impeach Trump, the equivalent of filing formal charges, a trial by the Republican-led Senate would all but certainly acquit him, keeping him in office.

And here’s another loss. It doesn’t stop.

• Feds End Investigation Into Trump Org And Hush Money Payments (CNN)

Federal prosecutors in New York have ended their investigation into the Trump Organization’s role in hush money payments made to women who alleged affairs with President Donald Trump and have been ordered by a judge to release additional information connected to their related probe of former Trump lawyer Michael Cohen, according to court documents filed Wednesday. CNN reported Friday that the Manhattan US Attorney’s office had approached the end of its investigation of the Trump Organization and wasn’t poised to charge any executives involved in the company’s effort to reimburse Cohen for money he paid to silence one of the women. That payment constituted an illegal campaign contribution, according to prosecutors. Trump has denied the affair allegations.

“The campaign finance violations discussed in the Materials are a matter of national importance,” US District Court Judge William Pauley wrote in his decision. “Now that the Government’s investigation into those violations has concluded, it is time that every American has an opportunity to scrutinize the Materials.” Pauley ordered a copy of the government’s July status report and copies of search warrant materials from the Cohen case to be filed publicly with very limited redactions by Thursday at 11 a.m. ET. The conclusion of federal prosecutors’ investigation of the Trump company’s role in the Cohen matter marks a significant victory for the President’s family business, although it likely doesn’t come as a complete surprise.

There had been no contact between the Manhattan US Attorney’s office and officials at the Trump Organization in more than five months, CNN reported Friday. A lawyer for Trump, Jay Sekulow, said: “We are pleased that the investigation surrounding these ridiculous campaign finance allegations is now closed. We have maintained from the outset that the President never engaged in any campaign finance violation.”

I see many Chinese tourists here in Athens. And often think Beijing can’t let that trend continue, because these people can’t pay for their trips in yuan. But yes, it’s easier to start with halting the outflow of larger amounts.

• Foreign Purchases Of US Homes Plunge 36%, Chinese Flee The Market (CNBC)

Challenging conditions in the U.S. housing market, along with tighter currency controls by the Chinese government, caused a stunning drop in foreign demand for American homes. The dollar volume of homes purchased by foreign buyers from April 2018 through March 2019 dropped 36% from the previous year, according to the National Association of Realtors. The decline was due to a drop in the number and average price of purchases. Foreigners bought 183,100 properties with a total value of about $77.9 billion, down from 266,800 valued at $121 billion in the previous period. They paid a median price of $280,600, which is higher than the median for all existing homebuyers ($259,600), but it was down from $290,400 the previous year.

“A confluence of many factors — slower economic growth abroad, tighter capital controls in China, a stronger U.S. dollar and a low inventory of homes for sale — contributed to the pullback of foreign buyers,” said Lawrence Yun, NAR’s chief economist. “However, the magnitude of the decline is quite striking, implying less confidence in owning a property in the U.S.” The Chinese were the leading buyers for the seventh consecutive year, purchasing an estimated $13.4 billion worth of residential property. Yet that was a 56% decline from the previous 12 months and comparatively the biggest percentage drop of all foreign buyers. Chinese economic growth slowed to 6.3% in 2019 compared with 6.9% in 2017, when the previous buyer survey began. The Chinese government also tightened its grip on the outflow of cash to purchase foreign property.

New Zealand housing, like Australia and Vancouver, depends on the Chinese too.

• New Zealand’s Armour-Plated Housing Bubble (Hickey)

New Zealanders usually welcome the praise when overseas authorities describe us as the best in the world. This time, not so much. In the past fortnight, global economic news authorities The Economist and Bloomberg Economics have both declared New Zealand houses to be vastly over-valued relative to both rents and incomes. They describe New Zealand as in bubble territory similar to those seen in other countries before the Global Financial Crisis and vulnerable to the sort of 30-40 percent price crash seen in the likes of Ireland and parts of the US through 2007 to 2010. The Economist’s long-running Global House Price Index was refreshed on June 27 with March quarter data for most countries and showed New Zealand top of the pops when it came to over-valuation relative to incomes and second most over-valued relative to rents behind Canada.

It found New Zealand prices in the December quarter of 2018 to be 57 percent over-valued relative to rents, just above Australia’s 42 percent overvalued in the March quarter. New Zealand was 113 percent over-valued relative to rents, just behind Canada’s 120 percent, The Economist found. New Zealand prices have more than trebled since 1990, while British and American prices are still less than double what they were 30 years ago. “On this basis, house prices appear to be on an unsustainable path in Australia, Canada and New Zealand,” The Economist wrote. “Ten years ago they reached similarly dizzying heights against rents and incomes in Spain, Ireland and some American cities, only to endure a brutal collapse,” it concluded.

[..] New Zealand’s housing market is now worth NZ$1.13 trillion, which is up by more than $1 trillion from NZ$123 billion in 1990. The increase is more than triple because there are more houses with more extras (decks/garages/rooms) added on. That’s $1 trillion in untaxed capital gains, which at the top marginal rate would have generated extra tax revenues of $330 billion, or enough to build nearly 700,000 new state houses or fund the next 14 years of New Zealand Superannuation payments. Our housing market is worth 3.9 times our GDP and more than 7.2 times the value of our stock market. For comparison sake, Australia’s housing market is worth A$6.6 trillion or 3.5 times Australia’s GDP and 3.3 times the value of its stock market. America’s housing market is worth US$33.3 trillion or 1.6 times US GDP and 1.5 times the value of the US stock market.

Governments like bubbles.

• Extraordinary Collapse In Home Ownership In Sydney And Melbourne (SMH)

The number of people owning their home outright has collapsed by a third as house prices have soared four-fold over the past two decades, leaving a growing number of older Australians shackled to mortgages as they head into retirement. In the mid-1990s, almost 44 per cent of people in NSW owned their home outright, but according to the Australian Bureau of Statistics this has now fallen to just 29.7 per cent. At the same time, the proportion of people in NSW with a mortgage has jumped by more than 30 per cent, with many of those heading towards their retirement years. The swing from ownership to mortgage has occurred over the past 20 years as the median house price in Sydney lifted by 460 per cent, even taking into account the recent market softening.

It’s a similar story in Victoria, where in the mid-1990s more than 45 per cent of people were mortgage-free, but now that figure has fallen to just 31 per cent. Victorians are among the most exposed to changing interest rates, with more than 37 per cent of people holding a mortgage. Two decades ago less than 30 per cent held a housing debt with their bank. Over the same period, the median house price in Melbourne has soared from $126,131 to $806,000. The Northern Territory has the smallest proportion of people who own their home outright, at just 17 per cent. Among the states, just 27 per cent of residents in Queensland and Western Australia enjoy life without a mortgage or rental payments.

Dalio channels Minsky: stability leads to instability. He must be aware of that.

• Paradigm Shifts (Ray Dalio)

There are always big unsustainable forces that drive the paradigm. They go on long enough for people to believe that they will never end even though they obviously must end. A classic one of those is an unsustainable rate of debt growth that supports the buying of investment assets; it drives asset prices up, which leads people to believe that borrowing and buying those investment assets is a good thing to do. But it can’t go on forever because the entities borrowing and buying those assets will run out of borrowing capacity while the debt service costs rise relative to their incomes by amounts that squeeze their cash flows. When these things happen, there is a paradigm shift.

Debtors get squeezed and credit problems emerge, so there is a retrenchment of lending and spending on goods, services, and investment assets so they go down in a self-reinforcing dynamic that looks more opposite than similar to the prior paradigm. This continues until it’s also overdone, which reverses in a certain way that I won’t digress into but is explained in my book Principles for Navigating Big Debt Crises [..] Another classic example that comes to mind is that extended periods of low volatility tend to lead to high volatility because people adapt to that low volatility, which leads them to do things (like borrow more money than they would borrow if volatility was greater) that expose them to more volatility, which prompts a self-reinforcing pickup in volatility.

There are many classic examples like this that repeat over time that I won’t get into now. Still, I want to emphasize that understanding which types of paradigms exist and how they might shift is required to consistently invest well. That is because any single approach to investing—e.g., investing in any asset class, investing via any investment style (such as value, growth, distressed), investing in anything—will experience a time when it performs so terribly that it can ruin you.

Think he means that for pension funds as well?

• Ray Dalio Says Gold Top Investment During Upcoming ‘Paradigm Shift’ (CNBC)

Hedge fund kingpin Ray Dalio is seeing a case for gold as central banks get more aggressive with policies that devalue currencies and are about to cause a “paradigm shift” in investing. Dalio, founder of the world’s largest hedge fund, wrote in a LinkedIn post that investors have been pushed into stocks and other assets that have equity-like returns. As a result, too many people are holding these types of securities and likely to face diminishing returns. “I think these are unlikely to be good real returning investments and that those that will most likely do best will be those that do well when the value of money is being depreciated and domestic and international conflicts are significant, such as gold,” the Bridgewater Associates leader said.

“Additionally, for reasons I will explain in the near future, most investors are underweighted in such assets, meaning that if they just wanted to have a better balanced portfolio to reduce risk, they would have more of this sort of asset. For this reason, I believe that it would be both risk-reducing and return-enhancing to consider adding gold to one’s portfolio. I will soon send out an explanation of why I believe that gold is an effective portfolio diversifier.” [..] Dalio’s call comes two weeks before the Federal Reserve is expected to cut its benchmark interest rate by at least a quarter point. That move comes after a three-year cycle of raising rates from the historically accommodative near-zero levels implemented during the financial crisis.

The fresh trends are part of what he labeled a new “paradigm shift” that comes after the last one during the crisis. Investors, Dalio said, are going to need to change their mindset about what will work after the longest bull market run in Wall Street history. “In paradigm shifts, most people get caught overextended doing something overly popular and get really hurt,” he wrote. “On the other hand, if you’re astute enough to understand these shifts, you can navigate them well or at least protect yourself against them.”

“Turkey makes more than 900 parts of the F-35..”

• US Removes Turkey From F-35 Program After S-400 Purchase From Russia (R.)

The United States said on Wednesday that it was removing Turkey from the F-35 fighter jet program, a move long threatened and expected after Ankara began accepting delivery of an advanced Russian missile defense system last week. The first parts of the S-400 air defense system were flown to the Murted military air base northwest of Ankara on Friday, sealing NATO ally Turkey’s deal with Russia, which Washington had struggled for months to prevent. “The U.S. and other F-35 partners are aligned in this decision to suspend Turkey from the program and initiate the process to formally remove Turkey from the program,” Ellen Lord, the undersecretary of defense for acquisition and sustainment, told a briefing.

Turkey’s foreign ministry said the move was unfair and could affect relations between the two countries. Lord said moving the supply chain for the advanced fighter jet would cost the United States between $500 million and $600 million in non-recurring engineering costs. Turkey makes more than 900 parts of the F-35, she said, adding the supply chain would transition from Turkish to mainly U.S. factories as Turkish suppliers are removed. “Turkey will certainly and regrettably lose jobs and future economic opportunities from this decision,” Lord said. “It will no longer receive more than $9 billion in projected work share related to the F-35 over the life of the program.”

The F-35 stealth fighter jet, the most advanced aircraft in the U.S. arsenal, is used by NATO and other U.S. allies. Washington is concerned that deploying the S-400 with the F-35 would allow Russia to gain too much inside information about the aircraft’s stealth system. “The F-35 cannot coexist with a Russian intelligence collection platform that will be used to learn about its advanced capabilities,” the White House said in a statement earlier on Wednesday.

One of my greatest heroes. She does what Muhammad Ali did.

• Chelsea Manning’s Daily Fines for Grand Jury Resistance Increase to $1000 (SP)

Daily fines against Chelsea Manning for resisting a grand jury investigating WikiLeaks increased to $1000 on July 16. On May 16, Judge Anthony Trenga held Manning in civil contempt and ordered her to be sent back to the William G. Truesdale Adult Detention Center in Alexandria. The court also imposed a fine of $500 per day after 30 days, and then a fine of $1000 per day after 60 days. From June 16 to July 15, the court fined her $500/day. Those fines total $15,000. If Manning “persists in her refusal” for the next 15 months or until the grand jury’s term ends, her legal team says she will face a total amount of fines that is over $440,000. This excessive amount may violate her Eighth Amendment rights under the Constitution.

In May, Manning’s attorneys filed a motion challenging the harshness of the fines. The federal court has yet to rule on the motion or hold a hearing. The motion asserted there is no “appropriate coercive sanction” because Manning will never testify. She should be released from jail and relieved of all fines. “Ms. Manning has publicly articulated the moral basis for her refusal to comply with the grand jury subpoena, in statements to the press, in open court, and most recently, in a letter addressed to this court,” her attorneys stated. “She is suffering physically and psychologically, and is at the time of this writing in the process of losing her home as a result of her present confinement.”

Debt Rattle July 10 2019

Jul 102019

July 10, 2019 Posted by Raúl Ilargi Meijer at 9:47 am Finance Tagged with: Antarctica, AOC, Attenborough, Cyprus, Deutsche, drilling, Epstein, Facebook, honeybees, Syria, Trump, Turkey, Twitter, Yemen 11 Responses »

Pablo Picasso Guernica [Study] V 1937

• Jeffrey Epstein Shipped Himself A 53-Pound Shredder (Grim)

• Doubts Over Deutsche Bank Turnaround Plan Dent Shaky Shares (R.)

• Trump’s Twitter Blocking Violates Constitution – Appeals Court (CNN)

• Ocasio-Cortez Sued Over Twitter Blocks (Hill)

• Facebook’s New Policy Says It’s OK to Post Death Threats Against Me (PJW)

• EU Subsidy Loss ‘Could Wipe Out UK Farms’ Like The Coal Industry (BBC)

• UK, France To Send Forces To Syria … But Americans Will Pay (RT)

• U.S Wants Military Coalition To Safeguard Waters Off Iran, Yemen (R.)

• US Urges Turkey To Halt Drilling Operations Off Cyprus Coast (R.)

• EU To Cut Contacts, Aid To Turkey Over Cyprus Drilling Violations (K.)

• Turkey Rejects Greek, EU Claims That Drilling Off Cyprus Illegitimate (R.)

• Holland Covers Hundreds Of Bus Stops With Plants As Gift To Honeybees (Ind.)

• David Attenborough: Polluting Planet May Become As Reviled As Slavery (G.)

• Glacial Melting In Antarctica May Become Irreversible (G.)

The news will be all over Epstein for a long time to come. This overview from Ryan Grim is as good as the next one. We must wait till details start leaking out. Trump Labor Sec. Acosta will be gone, but who else pops up?

• Jeffrey Epstein Shipped Himself A 53-Pound Shredder (Grim)

Jeffrey Epstein shipped a shredder from the U.S. Virgin Islands to his Palm Beach home in July 2008, shortly after reaching a non-prosecution agreement with then-U.S. Attorney Alex Acosta, maritime records show. Then, in March of this year, shortly after a Florida federal judge invalidated that agreement, Epstein shipped a tile and carpet extractor from the Virgin Islands to his Manhattan townhouse, the records show. Epstein, a billionaire financier, was arrested in New Jersey last Saturday on charges of running a sex trafficking ring that involved luring underage girls to his New York and Florida residences, and taking them on global flights on his airplane, dubbed the “Lolita Express.”

Epstein was first accused of abusing underage girls, some of them as young as 14, more than a decade ago, and he evaded prosecution potentially due to his high-profile connections. A key challenge investigators faced when first targeting Epstein in the mid-2000s was an inability to obtain evidence through subpoena. A 2005 search of Epstein’s Palm Beach home came up empty in its quest for computers that investigators suspected contained critical evidence connected to his alleged sexual abuse of young girls. In 2007, a federal grand jury subpoenaed the computers. That August, Acosta, who is now Donald Trump’s labor secretary, entered into plea agreement discussions with Epstein.

Because of those talks, a motion to compel production of Epstein’s computers was delayed, according to the Miami Herald. Epstein held out, however, resisting the deal because it would require him to register as a sex offender. The FBI continued investigating and in March 2008, according to the Miami Herald, preparations were being made to take the case to a new federal grand jury. That would prove unnecessary, as Epstein agreed to a deal with Acosta. Without notifying the 32 identified victims, the federal government reached a non-prosecution agreement with Epstein in exchange for his guilty plea in state court to a minor offense. He pleaded guilty on June 30.

On July 7, 2008, federal prosecutors told Epstein’s attorneys via email that they intended to notify the 32 victims about the agreement. Epstein’s lawyers and the prosecutors debated how much of the agreement to reveal, settling on a less than full accounting. A week later, on July 15, Epstein received a shipment at his Palm Beach home from the port in the U.S. Virgin Islands closest to his home there, according to maritime shipping records compiled by ImportGenius and provided to The Intercept. The shipment was a 53-pound shredder.

For the next decade, Epstein’s legal troubles appeared to be behind him. Then, in November 2018, the Miami Herald published a new investigation into Epstein’s alleged child sex trafficking ring, which prompted federal investigators to take a new look at the case. However, the agreement not to prosecute first had to be invalidated. That came on February 21, when a Florida federal judge ruled that Acosta’s office had violated the Crime Victims’ Rights Act by keeping the women in the dark.

Best-selling author James Patterson on the Jeffrey Epstein case as it relates to President Donald Trump: “There were some complaints about Epstein at Mar-a-Lago. I spoke to the head of the spa there. … She said she went to Trump and he threw [Epstein] out of the club.” pic.twitter.com/kNDK4MdrEd

— Ryan Saavedra (@RealSaavedra) July 9, 2019

They’re on “on a week-long roadshow to explain the restructuring”?! What century is this?

• Doubts Over Deutsche Bank Turnaround Plan Dent Shaky Shares (R.)

Deutsche Bank shares extended losses on Tuesday on investor doubts that its chief executive can revive the lender by shrinking the investment bank and returning to its roots as banker to corporate Germany. Christian Sewing, CEO for just over a year, and his finance chief are on a week-long roadshow to explain the restructuring. To underline his commitment, Sewing plans to invest a quarter of his fixed salary — around 820,000 euros — in Deutsche shares, a person with knowledge of the matter said. Deutsche’s stock price has fallen 10 percent since Sunday’s restructuring announcement to cut 18,000 jobs in a 7.4 billion euro ($8.3 billion) “reinvention”. It is the biggest two-day decline in almost three years.

By 1312 GMT, shares were down 3.8% on the day, after sliding as much as 6.5% earlier. The bank’s bonds also fell. Analysts and investors say Sewing, who joined Deutsche Bank in 1989, is right to cut back its trading desks but question if he can make his plan work when interest rates are still low and U.S. banks have expanded their share of the German market. “There seems to be some concerns around the plan details, particularly the ability for the bank to retain revenues while cutting costs,” one of the bank’s top 25 shareholders told Reuters, citing worries the bank would need fresh equity to execute Sewing’s plan.

But if this applies to Trump, who’s next?

• Trump’s Twitter Blocking Violates Constitution – Appeals Court (CNN)

An appeals court said Tuesday that President Donald Trump violated the First Amendment by blocking users on Twitter. The 2nd US Circuit Court of Appeals upheld a New York judge’s ruling and found that Trump “engaged in unconstitutional viewpoint discrimination by utilizing Twitter’s ‘blocking’ function to limit certain users’ access to his social media account, which is otherwise open to the public at large, because he disagrees with their speech.” “We hold that he engaged in such discrimination,” the ruling adds. The judges on the appeals court concluded that “the First Amendment does not permit a public official who utilizes a social media account for all manner of official purposes to exclude persons from an otherwise-open online dialogue because they expressed views with which the official disagrees.”

The challenge to Trump’s unprecedented use of Twitter in office came from seven individuals he blocked, as well as the Knight First Amendment Institute, which argued that the President’s personal account is an extension of his office. The Justice Department argued in March that the President wasn’t “wielding the power” of the federal government when he blocked certain individuals from his personal Twitter account, @realDonaldTrump, because while the President sends tweets in his official capacity, he blocks users as a personal matter. But the appeals court disagreed with that view.

The goose and the gander.

• Ocasio-Cortez Sued Over Twitter Blocks (Hill)

One former Democratic state lawmaker and one Republican congressional hopeful announced this week that they are suing Rep. Alexandria Ocasio-Cortez (D-N.Y.) over being blocked from her personal Twitter account. Former state assemblyman Dov Hikind (D) and congressional candidate Joseph Saladino, who is running in a Republican primary for the chance to battle Rep. Max Rose (D-N.Y.), announced lawsuits this week against the freshman Democratic congresswoman, seeking injunctive relief in the form of a court order demanding they be unblocked. Saladino announced in a press release that he had filed suit in the Southern District of New York, while Hikind told Fox News that he had filed his claim in the state’s Eastern District.

“I have officially filed my lawsuit against AOC for blocking me on twitter,” Saladino tweeted. “Trump is not allowed to block people, will the standards apply equally? Stay tuned to find out!” “If we can’t talk to one another, the whole system breaks down,” Saladino added in his press release. “Look what is happening in my district when entrenched NeverTrumpers are confronted by America First ideas. Like it or not we live in the same city and we need to be professional.” In an interview with Fox News, Hikind pointed to a recent court ruling declaring that President Trump is not allowed to block critics from his official Twitter account because of his status as a public official as legal precedent for his claim.

“Just today the 2nd Circuit Court of Appeals affirmed a ruling that elected officials cannot block individuals from their Twitter accounts, thereby setting a precedent that Ocasio-Cortez must follow,” Hikind told the network. “Twitter is a public space, and all should have access to the government officials on it.”

Think of Paul Joseph Watson what you like, but this is insane. Time to tackle Zuck.

• Facebook’s New Policy Says It’s OK to Post Death Threats Against Me (PJW)

Facebook has issued a new policy update saying it’s acceptable to post death threats and incite violence against me, despite this being a crime in the United Kingdom. No, I’m not joking. A Community Standards update published by Facebook states (emphasis mine); “Do not post: Threats that could lead to death (and other forms of high-severity violence) of any target(s) where threat is defined as any of the following: “Statements of intent to commit high-severity violence; or Calls for high-severity violence (unless the target is an organization or individual covered in the Dangerous Individuals and Organizations policy)….”

Back in May, Facebook and Instagram banned me under the justification that I was a “dangerous individual”. They provided no evidence whatsoever that I had behaved in a “dangerous” manner or violated any of their policies. Facebook has designated me a “dangerous individual” and now says it’s acceptable for its users to issue death threats against me. This is a crime in the United Kingdom under the 1988 Malicious Communications Act which states, “Any person who sends to another person a letter, electronic communication or article of any description which conveys….a threat….is guilty of an offence.” The largest social media company in the world with over 2 billion users literally says its fine to incite violence against me, despite this being illegal. They are painting a target on my back.

[..] Two months ago, via my lawyers, I filed a Subject Access Request demanding Facebook turn over all information relating to me. Facebook has yet to respond to this request, despite it being a legal requirement to respond within 30 days. If and when Facebook ever responds to this legal demand, the next step will be to begin litigation proceedings. The fact that Facebook has literally said it’s OK to incite violence against me is going to be a very interesting potential addition to those proceedings.

Maybe the coal industry is not the best example in the time of climate crisis.

• EU Subsidy Loss ‘Could Wipe Out UK Farms’ Like The Coal Industry (BBC)

With three months to go before the UK could leave the European Union (EU), farmers say they still face uncertainty about future subsidy levels. Last year farmers received £3.5bn in financial support through the EU’s Common Agricultural Policy (CAP). One farmer from York said he feared farms could soon be “wiped out like the coal industry”. The government said farmers had been told subsidy levels would be maintained until the next general election. But the National Audit Office said farmers had been left unable to plan for the future and the main farming union called for “cast-iron commitments” from the government. CAP funding is one of the EU’s biggest policies with a Europe-wide budget worth more than £50bn a year.

The subsidies are designed to support the farming industry and help farmers and landowners maintain their land. Some farmers have said without long-term guarantees about future subsidy levels, farms could disappear from the landscape. “We could be wiped out like the coal industry,” said Roger Hobson, whose 4,500-acre farm near York qualifies for a subsidy worth £100,000 a year. “This is not just about growing food, these subsidies help us improve the landscape and protect endangered species. “What we fear is that in the future the farm industry will have to go to the government and compete for funding alongside the NHS and other public services. “In that situation the government is always going to pick the NHS over farmers.”

Don’t.

• UK, France To Send Forces To Syria … But Americans Will Pay (RT)

With US President Donald Trump hungry for a withdrawal from Syria, a new report claims Britain and France will send their own forces to pick up the slack, along with other allies. But the swap will cost Washington. Between 1,000 and 2,000 American troops are presently stationed in northeastern Syria, supporting anti-government Kurdish fighters. However, as the US looks to wind down its presence in Syria, the Trump administration has looked to its allies to pick up the slack. Germany rebuffed a request for ground troops on Monday, citing “well known” German policy. Britain and France, on the other hand, are willing to heed Washignton’s call, according to a new report from Foreign Policy.

Both countries have a limited number of special forces on the ground in Syria, and will commit to a troop increase of between 10 and 15 percent to allow the US to withdraw. President Trump is no fan of outsourcing American jobs to foreigners, so why have Britain and France to do America’s dirty work? Well, for one thing, it’ll silence saber-rattlers like John Bolton. Trump announced the US’ complete withdrawal from Syria in December, a country that he said at the time was “sand and death.” The move was seen as a return to the non-interventionist platform he touted during his election campaign, when he mused “why aren’t we letting ISIS go and fight Assad and then we pick up the remnants?”

Yeah, we really need Europeans involved in the Saudi war on Yemen.

• U.S Wants Military Coalition To Safeguard Waters Off Iran, Yemen (R.)

The United States hopes to enlist allies over the next two weeks or so in a military coalition to safeguard strategic waters off Iran and Yemen, where Washington blames Iran and Iran-aligned fighters for attacks, the top U.S. general said on Tuesday. Under the plan, which has only been finalized in recent days, the United States would provide command ships and lead surveillance efforts for the military coalition. Allies would patrol waters near those U.S. command ships and escort commercial vessels with their nation’s flags. Marine General Joseph Dunford, the chairman of the Joint Chiefs of Staff, articulated those details to reporters following meetings on Tuesday about it with acting U.S. Defense Secretary Mark Esper and Secretary of State Mike Pompeo.

“We’re engaging now with a number of countries to see if we can put together a coalition that would ensure freedom of navigation both in the Straits of Hormuz and the Bab al-Mandab,” Dunford said. “And so I think probably over the next couple of weeks we’ll identify which nations have the political will to support that initiative and then we’ll work directly with the militaries to identify the specific capabilities that’ll support that.” Iran has long threatened to close the Strait of Hormuz, through which almost a fifth of the world’s oil passes, if it was unable to export its oil, something U.S. President Donald Trump’s administration has sought as a way to pressure Tehran to renegotiate a deal on its nuclear program.

Or what? Sanctions? Erdogan is a wounded animal, beware.

• US Urges Turkey To Halt Drilling Operations Off Cyprus Coast (R.)

The US State Department on Tuesday urged Turkish authorities to halt energy drilling operations off the Cypriot coast in the Mediterranean, a day after Cyprus protested a Turkish ship dropping anchor there. “This provocative step raises tensions in the region. We urge Turkish authorities to halt these operations and encourage all parties to act with restraint and refrain from actions that increase tensions in the region,” a US State Department spokeswoman said in a statement. Turkey and the internationally recognized government of Cyprus have overlapping claims in that part of the Mediterranean, an area thought to be rich in natural gas.

Cyprus, a member of the European Union, has discovered natural gas in areas off the southern coast of the disputed island, though nothing has been extracted. Turkey contests the rights of Cyprus to explore for gas, sending its own drilling ships to stake claims around the island. Refinitiv Eikon shipping data showed a Turkish ship arrived off the east coast of Cyprus earlier this week. Another Turkish vessel has been spotted off the west of Cyprus since early May. The Cypriot presidency on Monday accused Turkey of a “grave violation,” and an EU statement also rebuked the Turkish action.

“Such action could target companies, individuals, and Turkey’s deep-sea hydrocarbon exploration and production sectors..”

• EU To Cut Contacts, Aid To Turkey Over Cyprus Drilling Violations (K.)

The European Union is considering suspending most high-level contacts with Turkey and cut the flow of funds in protest of the Turkish drilling activities in the Cyprus EEZ, Bloomberg reports. A range of measures will reportedly be discussed by EU ministers on Wednesday in Brussels. One measure could limit the European Investment Bank’s sovereign-backed lending in Turkey and confirm a cut of some 146 million euros ($163 million) in aid for next year. The options proposed by the European Commission also include suspending all ministerial and leaders’ meetings, as well as ongoing talks between the two sides on an aviation agreement.

The European External Action Service would also advise member states to refrain from high-level contacts with Turkey. Bloomberg reports that EU leaders have sided with Cyprus in the dispute, declaring last month that they are ready to consider sanctions if Turkey continues drilling. Such action could target companies, individuals, and Turkey’s deep-sea hydrocarbon exploration and production sectors, though they aren’t currently on the menu of the commission’s proposals. The measures will likely be agreed Wednesday and approved by EU foreign ministers when they meet in Brussels next week.

Turkey claims northern Cyprus is Turkish land.

• Turkey Rejects Greek, EU Claims That Drilling Off Cyprus Illegitimate (R.)

Turkey’s foreign ministry said on Wednesday it rejected statements by Greek and European Union officials that Turkish drilling for gas and oil off Cyprus was illegitimate and said the EU could not be an impartial mediator on the Cyprus problem. The ministry said in a statement that Turkey’s Fatih ship had started drilling activities to the west of the Mediterranean island at the start of May and its Yavuz ship had recently arrived to the east of Cyprus and would conduct drilling activities.

Sometimes it’s the simplest things. But when they start blabbing about “completely clean public transport”, you know they don’t really have a clue. A long struggle lies ahead.

• Holland Covers Hundreds Of Bus Stops With Plants As Gift To Honeybees (Ind.)

The roofs of hundreds of bus stops have been covered in plants as a gift to honeybee, by a city in the Netherlands. Mainly made up of sedum plants, a total of 316 have been covered in greenery in Utrecht. The shelters not only support the city’s biodiversity, such as honey bees and bumblebees, but they also help capture fine dust and store rainwater. The roofs are looked after by workers who drive around in electric vehicles, and the bus stops have all been fitted with energy-efficient LED lights and bamboo benches.

The city aims to introduce 55 new electric buses by the end of the year and have “completely clean public transport” by 2028. The electricity used to power the buses will come directly from Dutch windmills. Utrecht also runs a scheme which allows residents to apply for funding to transform their own roofs into green roofs.

He woke up late, but he did.

• David Attenborough: Polluting Planet May Become As Reviled As Slavery (G.)

The attitude of young people towards tackling the environmental crisis is “a source of great hope”, David Attenborough has told MPs, as he predicted that polluting the planet would soon provoke as much abhorrence as slavery. Giving evidence to the business, energy and industrial strategy committee on how to tackle the climate emergency, the naturalist and TV presenter said radical action was required. Asked by the Tory MP Patrick McLoughlin, a committee member, whether the government’s new commitment of net zero carbon emissions for the UK by 2050 was rapid enough, Attenborough said such targets were not necessarily the best approach. “In a way I would think that is not the way of focusing on the problem,” he said.

“We cannot be radical enough in dealing with the issues that face us at the moment. The question is: what is practically possible? How can we take the electorate with us in dealing with these things?” He said: “The most encouraging thing that I see, of course, is that the electors of tomorrow are already making themselves and their voices very, very clear. And that is a source of great comfort in a way, but also the justification, the reality, that these young people are recognising that their world is the future. “I’m OK, and all of us here are OK, because we don’t face the problems that are coming. But the problems in the next 30 years are really major problems that are going to cause social unrest, and great changes in the way that we live, and what we eat. It’s going to happen.”

Asked by the Labour MP Vernon Coaker to expand on how public attitudes were shifting, Attenborough replied: “There was a time in the 19th century when it was perfectly acceptable for civilised human beings to think that it was morally acceptable to actually own another human being for a slave. And somehow or other, in the space of 20 or 30 years, the public perception of that totally transformed.” He said: “I suspect that we are right now in the beginning of a big change. Young people in particular are the stimulus that’s bringing it about.

Not surte that talking about things that MIGHT happen in 600 years is very useful…

• Glacial Melting In Antarctica May Become Irreversible (G.)

Antarctica faces a tipping point where glacial melting will accelerate and become irreversible even if global heating eases, research suggests. A Nasa-funded study found instability in the Thwaites glacier meant there would probably come a point when it was impossible to stop it flowing into the sea and triggering a 50cm sea level rise. Other Antarctic glaciers were likely to be similarly unstable. Recent research found the rate of ice loss from five Antarctic glaciers had doubled in six years and was five times faster than in the 1990s. Ice loss is spreading from the coast into the continent’s interior, with a reduction of more than 100 metres in thickness at some sites.

The Thwaites glacier, part of the West Antarctic ice sheet, is believed to pose the greatest risk for rapid future sea level rise. Research recently published in the Proceedings of the National Academy of Sciences journal found it was likely to succumb to instability linked to the retreat of its grounding line on the seabed that would lead to it shedding ice faster than previously expected. Alex Robel, an assistant professor at the US Georgia Institute of Technology and the study’s leader, said if instability was triggered, the ice sheet could be lost in the space of 150 years, even if temperatures stopped rising. “It will keep going by itself and that’s the worry,” he said.

Modelling simulations suggested extensive ice loss would start in 600 years but the researchers said it could occur sooner depending on the pace of global heating and nature of the instability. Hélène Seroussi, a jet propulsion laboratory scientist at Nasa, said: “It could happen in the next 200 to 600 years. It depends on the bedrock topography under the ice, and we don’t know it in great detail yet.”

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