Jul 252019
 
 July 25, 2019  Posted by at 1:43 pm Finance Tagged with: , , , , , , , , ,  4 Responses »


Salvador Dali The knight of death 1934

 

 

Another article from Alexander Aston, from whom I published among other things the series Quantum, Dada and Jazz this past November.

 

 

“Dulce et Decorum est” is a poem written by Wilfred Owen during World War I, and published posthumously in 1920. The Latin title is taken from Ode 3.2 of the Roman poet Horace and means “it is sweet and fitting …”. It is followed there by “pro patria mori”, which means “to die for one’s country”.

 

 

“The muffled tongue of Big Ben tolled nine by the clock as the cortege left the palace, but on history’s clock it was sunset, and the sun of the old world was setting in a dying blaze of splendour never to be seen again.”

– Barbara W. Tuchman, The Guns of August

 

Alexander Aston: If you have not read Barbara Tuchman’s The Guns of August you should do so, it is one of the great, accessible works of history. Tuchman details with great clarity the diplomatic failures, miscalculations and political logics that ensnared the imperial powers of Europe into the cataclysm of the Great War. It was the book that Kennedy drew upon when navigating the Cuban missile crisis. Just over a century since the guns fell silent in Europe, and nearly fifty years since nuclear holocaust was averted, the world is teetering on what might very well be the largest regional, potentially global, conflict since the second world war.

The United States is a warfare economy, its primary export is violence and it is through violence that it creates the demand for its products. The markets of the Empire are the failed states, grinding civil conflicts, escalating regional tensions and human immiseration created by gun-boat diplomacy. In true entrepreneurial spirit, the United States has repeatedly overestimated its abilities to control the course of events and underestimated the complexities of a market predicated on violence. However, since the beginning of the twenty-first century the American Imperium has proven itself as incompetent as it is vicious. After nearly two decades of intensifying conflicts, a fundamentally broken global economy and a dysfunctional political system, Washington has turned feral, lashing out against decline.

The points of instability in the global system are various and growing, and the only geo-political logics that the Imperium appears to be operating under are threats, coercion, and violence. It is at this moment, with the most erratic president in the country’s history, surrounded by some of the most extreme neo-conservative voices, that the United States has been belligerently stumbling across the globe. In the past few months we have witnessed a surrealistic reimagining of the Latin American coup, the medieval melodrama of Canadian vassals taking a royal hostage from the Middle Kingdom and British buccaneers’ privateering off the coast of Gibraltar. The Imperial system is in a paroxysm of incoherent but sustained aggression.

 

It has long been clear that if another Great War were to emerge, it would likely begin in the Middle East. Just over a century later, we have found ourselves amidst another July crisis of escalating military and diplomatic confrontations. European modernity immolated itself in the Balkans though miscalculation, overconfidence and the prisoners dilemma of national prestige. The conditions of the contemporary Middle East are no less volatile than those of Europe when the Austro-Hungarian Empire decided to attack Serbia. If anything, conditions are far more complex in a region entangled with allegiances and enmities that transgress and supersede the national borders imposed in the wake of the first world war.

The United States’ withdrawal from the JCPOA and the stated aim of reducing Iranian oil exports to zero has enforced a zero-sum logic between the American Imperium and Persia. With each move and counter move the two countries are further entangled into the dynamics of a conflict. Much like the run up to July 28th 1914, tanker seizures, drone shoot downs, sanctions, military deployments and general bellicosity reinforce the rational of the opposing sides and make it harder to back down without losing face and appearing weak.

Due to the asymmetry of the two powers the Iranians have the fewest options for de-escalation while the American establishment perceives the least incentive. This dynamic is further exacerbated by major regional powers agitating for a conflict they believe they will benefit from. Indeed, the slide to war might be inexorable at this point, the momentum of historical causality may have already exceeded the abilities of those in power to control. Czar Nicholas and Kaiser Wilhelm were cousins that desperately wanted to avoid war and were nonetheless impotent to avert disaster. There is nowhere near such intimacy, communication and motivation in our current context.

If war with Iran erupts, the Pax Americana will come to an end and humanity will fully enter a new historical epoch. The most unlikely scenario is an easy victory for the United States, yet even this outcome will only exacerbate the decline of the Empire. The other great powers would expedite their exit from the dollar system and drastically increase investment into the means to counter American hegemony. Likewise, victory would further reinforce Washington’s hubris, generating more serious challenges to the Imperial order and making the US prone to take on even bigger fights. Ironically, easy military success would almost assure the outbreak of a third world war in the long-term.

 

War with Iran would likely ignite violence in Israel-Palestine, Lebanon and Iraq, re-energise and expand the ongoing wars in Syria and Yemen as well as generate sectarian violence and domestic insurgencies across the Middle East. Under such conditions regional actors would likely utilise a dramatically intensifying conflict as cover for their own agendas, for example with a renewed Turkish assault on the Syrian Kurds. The conditions for rapid escalation are extremely high in which non-linear dynamics could easily take hold and quickly outstrip any attempts to maintain control of the situation.

Pyrrhic victory for either side is the most likely outcome, making the parallels to the Great War all the more salient. Global conflagration is a possibility, but with “luck” the fighting could be contained to the region. Nonetheless, amplified refugee crises, supply chain disruptions and immense geopolitical realignments will cascade out of such an event. Undoubtedly, there would be concerted efforts to abandon the dollar system as quickly as possible. Furthermore, rapid increases in the price of oil would all but grind the global economy to a halt within a matter of months, tipping citizenries already saturated with private debt into financial crises.

Furthermore, the entanglement of the military-industrial complex, the petrodollar reserve currency system and the omni-bubble generated by quantitative easing has left the Empire systemically fragile. Particularly, the bubble in non-conventional fuels precipitated by QE, depressed oil prices with scaled down exploration, R&D and maintenance makes the possibility of a self-reinforcing collapse in the American energy and financial systems extremely plausible. It is a Gordian knot which war with Persia would leave in fetters.

The most likely long-term outcome of a war with Iran would be the economic isolation and political fragmentation of the United States. What is assured is that whatever world results it will not look anything like the world since 1945. The first world war collapsed the European world system, dynasties that had persisted for centuries were left in ruins and the surviving great powers crippled by the overwhelming expenditures of blood and treasure. We are on the precipice of another such moment. The American world system is fundamentally dependent upon the relationship between warfare, energy dominance and debt.

 

Conflict is required to maintain control of the energy markets which prop up a financialised economy. A dynamic that puts the nation deeper in hock while amplifying resistance to financial vassalage. Losing energy dominance undermines the country’s reserve currency status and weakens the Empires ability to generate the debt necessary to sustain the warfare economy. Likewise, the system of national and international debt peonage parasitizes global populations to work against their own best interests. This fuels resentment and resistance which further drives the warfare economy. It is, in the inimitably American expression, a “self-licking ice cream cone.”

On August 3rd 1914, one week into the war, the British Foreign Secretary Edward Grey famously remarked that “the lamps are going out across Europe and we shall not see them relit in our lifetime.” At the beginning of the twenty-first century, we face similar, terrifying prospects. Indeed, we could witness the collapse of democratic societies for a very long time to come. If we have any hope of averting calamity we need to generate loud opposition to imperialist warfare.

This does not mean some hackneyed anti-war movement based on past glories and the parochialism of domestic politics, but earnest effort to find common cause in resisting the insanity of those that seek profit in our collective suffering. This means working with people that we have very deep disagreements with by respecting our mutual opposition to the masters of war. It also means serious commitment to strategies such as tax and debt strikes as expressions of non-consent as well as other peaceful means of direct action. Indeed, it is from a place of agreement that we can potentially rebuild civil discourse and renew our trust in the ability of democratic institutions to mediate our quarrels. Perhaps it is too late to change course, but how sweet and fitting it is to face madness with dignity.

 

“What is the cause of historical events? Power. What is power? …power is a word the meaning of which we do not understand. ”

“Kings are the slaves of history.”

– Tolstoy, War and Peace

 

 

Just a thought from Beau of the Fifth Column:

 

 

Dulce et Decorum Est

by Wilfred Owen

Bent double, like old beggars under sacks,
Knock-kneed, coughing like hags, we cursed through sludge,
Till on the haunting flares we turned our backs,
And towards our distant rest began to trudge.
Men marched asleep. Many had lost their boots,
But limped on, blood-shod. All went lame; all blind;
Drunk with fatigue; deaf even to the hoots
Of gas-shells dropping softly behind.

Gas! GAS! Quick, boys!—An ecstasy of fumbling
Fitting the clumsy helmets just in time,
But someone still was yelling out and stumbling
And flound’ring like a man in fire or lime.—
Dim through the misty panes and thick green light,
As under a green sea, I saw him drowning.

In all my dreams before my helpless sight,
He plunges at me, guttering, choking, drowning.

If in some smothering dreams, you too could pace
Behind the wagon that we flung him in,
And watch the white eyes writhing in his face,
His hanging face, like a devil’s sick of sin;
If you could hear, at every jolt, the blood
Come gargling from the froth-corrupted lungs,
Obscene as cancer, bitter as the cud
Of vile, incurable sores on innocent tongues,—
My friend, you would not tell with such high zest
To children ardent for some desperate glory,
The old Lie: Dulce et decorum est
Pro patria mori.

 

 

Alexander Aston is a doctoral candidate in archaeology at the University of Oxford and is on the board of directors with the Centre for Cognitive Archaeology at the University of Colorado in Colorado Springs. He has prior degrees in philosophy and history. His work lays at the intersection of Cognitive Archaeology, Deep History and Natural Philosophy, examining the relationship between ecology, material culture and social cognition. Alexander grew up between Zimbabwe, Greece and the United States.

 

 

 

 

Jun 212019
 


Pablo Picasso La guerre 1951

 

Trump Approved Strikes On Iran But Cancelled Them: Reports (AlJ)
The Drone Iran Shot Down Was a $220 Million Surveillance Monster (W.)
The Real Meaning Of Trump’s Deplorable Aggression Against Iran (Stockman)
Senate Blocks Arms Sales To Saudi Arabia In Bipartisan Trump Rebuke (ZH)
More Spent On S&P 500 Buybacks Than All 2018 R&D (Axios)
China Concerned Over Possible US Dollar Shortage Risk (SCMP)
US Spend Ten Times More On Fossil Fuel Subsidies Than Education (F.)
Bring on Higher Oil Prices: They’ll Boost the US Economy (WS)
Defiant Italy Urges Changes To EU Rules (R.)
UK Will Be ‘Diminished’ After Brexit – Dutch PM Rutte (Pol.eu)
Ecuador Judge Frees Ola Bini, Swedish Programer Close To Assange (R.)
Ten Cities Ask EU For Help To Fight Airbnb Expansion (G.)
The Dangerous Methane Mystery (CP)

 

 

When something like this is leaked to multiple news outlets at the same time, isn’t it likely the White House itself does the leaking?

Kim Dotcom’s take:

Trump: Attack Iran now!
General: Iran can sink our Carrier strike group in the region.
Trump: What?
General: If we strike Iran now they can retaliate against thousands of US sailors.
Trump: WTF!
General: This isn’t Syria Sir.
Trump: Call it off.
THE END

Trump Approved Strikes On Iran But Cancelled Them: Reports (AlJ)

US President Donald Trump approved military strikes on Friday against Iran in retaliation for the downing of an unmanned surveillance drone, but pulled back from launching the attacks, the New York Times reported. A US official told Associated Press that the military made preparations on Thursday night for limited strikes on Iran in retaliation for drone shootdown, but approval was abruptly withdrawn. The official, who was not authorised to discuss the operation publicly and spoke on condition of anonymity, said the targets would have included radars and missile batteries.


Planes were in the air and ships were in position, but no missiles fired, when the order to stand down came, the Times cited one senior administration official as saying. The abrupt reversal put a halt to what would have been Trump’s third military action against targets in the Middle East, the paper added, saying Trump had struck twice at targets in Syria, in 2017 and 2018. However, it is not clear whether attacks on Iran might still go forward, the paper said, adding that it was not known if the cancellation of strikes had resulted from Trump changing his mind or administration concerns regarding logistics or strategy.

Read more …

This thing is huge: “..a wingspan of more than 130 feet and a maximum takeoff weight of more than 16 tons..”

Why would Iran want that in its airspace?

The Drone Iran Shot Down Was a $220 Million Surveillance Monster (W.)

Early Thursday morning, Iran shot down a United States unmanned aerial vehicle over the Strait of Hormuz, which runs between the Persian Gulf and the Gulf of Oman. Iran identified the drone as an RQ-4A Global Hawk, a $220 million UAV that acts as a massive surveillance platform in the sky. The attack marks an escalation with tensions already running high between the US and Iran—particularly because of the value and technical sensitivity of the downed drone. Iran’s Islamic Revolutionary Guard Corps said on Thursday that the Northrup Grumman-made Global Hawk—part of a multibillion-dollar program that dates back to 2001—had entered Iranian airspace and crashed in Iranian waters; US Central Command confirmed the time and general location of the attack, but insists that the drone was flying in international airspace.


Alamy

The incident comes on the heels of another situation last week in which the US accused Iran of attacking two fuel tankers in the Gulf of Oman. The US also said that Iran had attempted to shoot down a different UAV—an MQ-9 Reaper drone—but failed. The Pentagon also linked Iran to an attack on a Reaper drone in Yemen two weeks ago that caused the vehicle to crash. Thursday’s attack, though, targeted a massive and much more expensive surveillance drone, and likely represents a more definite escalation. “There’s a lot going on here, and we’re probably only seeing some of it,” says Thomas Karako, director of the Missile Defense Project at the Center for Strategic and International Studies.


“This is a more expensive, higher-altitude, more capable, long-range intelligence surveillance reconnaissance craft. If they’re shooting down aircraft in international airspace over international waters, that’s likely to elicit some kind of measured reprisal.” Global Hawks are massive surveillance platforms, in operation since 2001, with a wingspan of more than 130 feet and a maximum takeoff weight of more than 16 tons, equivalent to roughly seven shipping containers of cocaine. They have a range of more than 12,000 nautical miles, can fly at strikingly high altitudes of 60,000 feet, and can stay aloft for 34 hours straight.


U.S. military drone RQ-4A Global Hawk – Eric Harris/U.S. Air Force/Handout via REUTERS

Read more …

Iran has no army to speak of, and hardly an economy. But it does have friends.

The Real Meaning Of Trump’s Deplorable Aggression Against Iran (Stockman)

Iran has no blue water Navy that could even get to the Atlantic and only 18,000 sailors including everyone from admirals to medics; an aging, decrepit fleet of war planes with no long range flight or refueling capabilities; ballistic missiles that mainly have a range of under 800 miles; a very limited air defense based on a Russian supplied S-300 system (not the far more capable S-400); and a land Army of less than 350,000 or approximately the size of that of Myanmar. Indeed, Iran’s defense budget of less than $15 billion amounts to just 7 days of spending compared to the Pentagon’s $750 billion; and it is actually far less even in nominal terms than Iran’s military budget under the Shah way back in the late 1970’s. In inflation-adjusted dollars, Iran’s military expenditure today is less than 25% of the level prior to the Revolution.

Whatever the foibles of today’s Iranian theocratic state, a thriving military power it is not. In fact, that’s the real irony. Mostly what comprises the core of Iran air force is left over 40-50 year-old planes that had been purchased from the US under the Shah, and which have been Jerry-rigged with bailing wire and bubble gum to stay aloft and to accommodate some modest avionics and armaments modernizations. As one analyst further noted, some of its planes were actually gifts from Saddam Hussein! Much of the IRIAF’s equipment dates back to the Shah era, or is left over from Saddam Hussein’s Iraqi air force, which flew many of its planes to Iran during the 1991 Persian Gulf War to avoid destruction. American-made F-4, F-5 and F-14 fighters dating from the 1970s remain the backbone of the Iranian air force.

So military threat has absolutely nothing to do with it. Washington is knee deep in harms’ way and on the verge of starting a war with Iran solely on account of a misguided notion that the Persian Gulf is an American Lake that needs to be policed by the US Navy; and, more crucially, that Washington has the right to control Iran’s foreign policy and determine what alliances it may and may not have in the region – including whether or not they pass muster with Bibi Netanyahu. Stated differently, the missions of protecting the oil supply lines and regulating the foreign policy of what amounts to a two-bit economic power is straight out of the playbook of Empire First. As such, it amounts to a foolish policy of putting America’s actual security last.

Read more …

When your own party turns against you, it’s time to pay attention.

Senate Blocks Arms Sales To Saudi Arabia In Bipartisan Trump Rebuke (ZH)

The Senate voted on Thursday to block billions of dollars of armaments to Saudi Arabia in what the New York Times described as a “sharp and bipartisan rebuke of the Trump administration’s attempt to circumvent Congress” by declaring an emergency over Iran. “In the first of a series of three back-to-back votes, Republicans joined Democrats to register their growing anger with the administration’s use of emergency power to cut lawmakers out of national security decisions, as well as the White House’s unflagging support for the Saudis despite congressional pressure to punish Crown Prince Mohammed bin Salman after the killing last October of the journalist Jamal Khashoggi”. -NYT

The vote marks the sharpest division between the White House and lawmakers to date – and is the second time in recent months that the administration has faced bipartisan pushback against foreign policy. In April, both the House and Senate voted to cut off military assistance to Saudi Arabia for use in Yemen under the 1973 War Powers Act, only for Trump to veto the measure (the second of his presidency). And once again, Trump will use his veto power to override Congress: “While the Democratic-controlled House is also expected to block the sales, Mr. Trump has pledged to veto the legislation, and it is unlikely that either chamber could muster enough support to override the president’s veto”. -NYT

“This vote is a vote for the powers of this institution to be able to continue to have a say on one of the most critical elements of U.S. foreign policy and national security,” said New Jersey Democrat Sen. Bob Menendez, lead sponsor of the resolutions of disapproval. “To not let that be undermined by some false emergency and to preserve that institutional right, regardless of who sits in the White House.” 22 pending arms sales to three Arab nations were announced in late May utilizing an emergency provision contained in the Arms Export Control Act. In total, $8.1 billion in munitions are part of the sales.

Read more …

Call that an economy?

More Spent On S&P 500 Buybacks Than All 2018 R&D (Axios)

Total research and development spending in the U.S. last year totaled $608 billion, according to data from the Federal Reserve, while corporations in the S&P 500 spent $806 billion buying back their own stock. The total for all companies was well over $1 trillion. What it means: In 2018, the 500 biggest U.S. companies spent 33% more on their stock buyback programs than the country is investing in research and development. The trend looks to be continuing this year as the U.S. is on pace to spend $642 billion on R&D in 2019 and poised to surpass last year’s $1.085 trillion total in buyback spending.

Read more …

Starting to sound serious.

China Concerned Over Possible US Dollar Shortage Risk (SCMP)

Anbang Insurance Group’s plan to sell its condos at the Waldorf Astoria hotel in New York is the latest in the string of high-profile Chinese divestments that underscores China’s concern that the nation is running short of US dollars. The Chinese holding company bought the Waldorf for a record US$1.95 billion in 2014, but under pressure from the Chinese government, is reported to be seeking buyers for the 375 flats at the hotel despite a glut of unsold luxury flats in Manhattan. In total, it is aiming to shed a portfolio of assets that includes 15 hotels having, like other highly leveraged Chinese conglomerates with overseas investments, been placed under scrutiny by Beijing.

Chinese real estate mogul Wang Jianlin’s Dalian Wanda Group has dumped US$25 billion in assets since 2017, while troubled conglomerate HNA Group was forced to sell everything from Hong Kong land parcels, to its stakes in Deutsche Bank, Hilton Grand Vacations as well as its airlines. Chinese oil giant CEFC China Energy also wants to sell 100 properties worldwide. The government’s dramatic about-face from encouraging aggressive overseas acquisitions to cracking down on risky lending and overseas transfers underscores worries over the risk that the nation could run short of enough US dollars to make the interest and principal payments on its mounting debt at a time when the current account balance is coming under pressure.

“These companies are selling their assets because they don’t have enough US dollars,” said Kevin Lai, chief economist for Asia excluding Japan at Daiwa Capital Markets. “China does not want to use its US$3 trillion foreign reserves for the debt repayments, so that is why these companies need to sell their assets.” On the surface, China should be the last country to worry about a US dollar shortage given that its US$3.1 trillion worth of foreign exchange reserves is the largest help by any nation.

But analysts believe China’s reserves may be insufficient to pay for its massive imports and debt payments in response to a worse-case scenario caused by the ongoing trade war with the United States, particularly since many of its assets cannot readily be turned into cash to help the central bank to save a crashing financial system or sharp devaluation of the yuan’s exchange rate. “In reality, they don’t have as much as US$3.1 trillion of liquid reserves,” said Rabobank analyst Michael Every. “I would estimate they probably only have a little bit more liquid reserves than what they hold in US Treasuries.”

Read more …

Fuel fools.

US Spend Ten Times More On Fossil Fuel Subsidies Than Education (F.)

A new International Monetary Fund (IMF) study shows that USD$5.2 trillion was spent globally on fossil fuel subsidies in 2017. The equivalent of over 6.5% of global GDP of that year, it also represented a half-trillion dollar increase since 2015 when China ($1.4 trillion), the United States ($649 billion) and Russia ($551 billion) were the largest subsidizers. Despite nations worldwide committing to a reduction in carbon emissions and implementing renewable energy through the Paris Agreement, the IMF’s findings expose how fossil fuels continue to receive huge amounts of taxpayer funding. The report explains that fossil fuels account for 85% of all global subsidies and that they remain largely attached to domestic policy.


Had nations reduced subsidies in a way to create efficient fossil fuel pricing in 2015, the International Monetary Fund believes that it “would have lowered global carbon emissions by 28 percent and fossil fuel air pollution deaths by 46 percent, and increased government revenue by 3.8 percent of GDP.” The study includes the negative externalities caused by fossil fuels that society has to pay for, not reflected in their actual costs. In addition to direct transfers of government money to fossil fuel companies, this includes the indirect costs of pollution, such as healthcare costs and climate change adaptation. By including these numbers, the true cost of fossil fuel use to society is reflected.

Read more …

Yeah, try and sell that to your voters.

Bring on Higher Oil Prices: They’ll Boost the US Economy (WS)

Powered by the iffy situation in the Persian Gulf, the Strait of Hormuz, and the Gulf of Oman, with attacks on tankers and now the downing of a US drone, the price of crude oil got a little nervous in recent days. WTI jumped about 6% today to over $57 a barrel. But this was just a minor uptick in the overall scheme of things: The US, which has become the largest oil producer in the world, is in the middle of its second oil bust in five years:

P These two oil busts are largely a consequence of surging US crude oil production. During the oil bust of 2014-2016, the price of WTI collapsed by over 75%, careening from $107 per barrel to a low of $27 per barrel in 18 months, before starting to rebound. In the process, a slew of oil-and-gas drillers filed for bankruptcy. For a while it looked like the shale boom, where all the growth in production had come from, was running out of money, and therefore out of fuel. Production fell sharply from early 2015 through much of 2016, but then new money from Wall Street appeared, and production began to soar again, hitting new records all along the way.


Shale wells produce a variety of liquid hydrocarbons (they also produce gaseous hydrocarbons which are not included here). This production of crude oil and petroleum products soared from just over 7 million barrels per day (bpd) in 2010 to 16.6 million bpd currently, according to EIA data:

P The US used to be the largest net importer of crude oil and petroleum products in the world. Between 2005 and 2008, “net imports” (imports minus exports) of crude oil and petroleum products exceeded 12 million bpd. But surging production in the US has slashed imports. And recently exports have surged, and the trade in crude oil and petroleum products is now nearly balanced between the US and the rest of the world. And the net imports are heading toward zero – the point where the US imports as much as it exports. In February, net imports were down to just 176,000 barrels a day, the lowest in the EIA data going back to 1971. In March, the most recent data available, net imports were 842,000 barrels a day:

Read more …

“We have a stability and growth pact that focuses on stability and not on growth. We want to invert this order..”

Defiant Italy Urges Changes To EU Rules (R.)

Italy’s prime minister defied European Union concern over its debt on Thursday, saying the bloc’s fiscal rules should focus on growth rather than stability, and blaming partners for unfair tax competition and excessive surpluses. Arriving at a meeting of European leaders in Brussels, Giuseppe Conte dismissed warnings over Rome’s growing debt and said Italy was complying with EU fiscal rules. “We have a stability and growth pact that focuses on stability and not on growth. We want to invert this order,” Conte told reporters. Under current rules, EU states with large public debts should gradually reduce them, but Rome’s debt increased last year and is forecast to expand further until 2020.


Conte said the Italian government will complete the assessment of its finances in a meeting on Wednesday after which he expects new estimates to point to a 2019 deficit of around 2.1% of output, below the EU commission’s expectations. It is unclear, however, whether this would be enough for the EU Commission to stop a disciplinary procedure against Italy, which Brussels has said would be warranted on the basis of 2018 data and EU forecasts. [..] At the summit where EU leaders are discussing the bloc’s top jobs for the coming years, Conte echoed belligerent tones used by Italy’s deputy prime minister and far-right leader Matteo Salvini in attacking other EU members for unfair competition. He said there was something wrong in the fact that Italian firms relocate to other EU states for tax reasons – a probable reference to low corporate levies and lenient regulatory approaches in places like Luxembourg, the Netherlands or Ireland.

Read more …

“..you are not big enough to have an important position, important enough on the world stage, on your own.”

UK Will Be ‘Diminished’ After Brexit – Dutch PM Rutte (Pol.eu)

No U.K. prime minister would be able to mitigate the economic impact of Brexit on Britain or sustain its global power outside of the EU, especially after a no-deal exit, Dutch Prime Minister Mark Rutte warned Conservative leadership candidates today. Speaking ahead of the European Council summit in Brussels, he told BBC Radio 4’s “Today” program this morning: “With a hard Brexit — even with a normal Brexit — the U.K. will be a different country. It will be a diminished country. “It is unavoidable. Because you are not any longer part of the European Union and you are not big enough to have an important position, important enough on the world stage, on your own.”

The leader of the Netherlands, who described himself as an “Anglophile,” also said the next occupant of Downing Street must be clear about what they want from the EU if they aim to modify the so-called Political Declaration on the future relationship between the two sides; however he ruled out any reopening of the Withdrawal Agreement struck by outgoing British premier Theresa May. He dismissed claims by leadership hopeful Boris Johnson that the U.K. could be granted a Brexit transition period after a no-deal departure. “As Boris Johnson would say, Brexit is Brexit, and a hard Brexit is a hard Brexit,” Rutte said. “I don’t see how you can sweeten that.”

Home Secretary and Johnson’s rival Sajid Javid’s claim that he could renegotiate the controversial backstop plan directly with Dublin also got short shrift from Rutte, who said Ireland is an integral part of the EU and “we cannot have a backdoor” to the single market. Both Johnson and Javid have vowed to take Britain out of the EU, deal or no deal, by the current deadline of October 31 if they fail to renegotiate the exit plan with Brussels before then. The Dutch leader warned that any no-deal departure would be “chaos.” He said if a new British PM wanted an extension to continue negotiating on Brexit, something Environment Secretary Michael Gove has proposed, they would have to be clear about “making changes to the red lines the U.K. is currently holding.”

Read more …

Will the courts dare turn against Lenin Moreno?

Ecuador Judge Frees Ola Bini, Swedish Programer Close To Assange (R.)

An Ecuadorean judge on Thursday ordered that a Swedish citizen and personal friend of WikiLeaks founder Julian Assange be freed, two months after he was detained for alleged participation in a hacking attempt on the government. But Ola Bini, a 36-year-old software developer who has lived in Ecuador for five years, remains under investigation in the case and will be barred from leaving the country, according to the court ruling. Bini was detained in April at the Quito airport before boarding a flight to Japan, hours after Ecuador withdrew asylum for Assange, who had lived at its London embassy for almost seven years while facing spying charges related to WikLeaks’ 2010 publication of secret U.S. diplomatic cables.


Ecuador’s Interior Minister Maria Paula Romo had accused him of seeking to destabilize the Andean country’s government and compromising its national security. Bini has denied those allegations, but has acknowledged being close to Assange. “His right to freedom was violated,” judge Patricio Vaca said, reading the Thursday court ruling. “We accept the habeas corpus action proposed by the Swedish citizen Ola Bini, who can be immediately freed.” Bini worked at the Quito-based Center for Digital Autonomy, an organization focusing on cybersecurity and data privacy. His lawyer, Carlos Soria, told journalists on Thursday that he would ask “international courts” to determine any “prejudice” to the case that may have resulted from his arrest. “We will take actions against everyone because the court has determined that his detention was arbitrary. Now they will have to pay,” Soria said. “We will demonstrate Ola Bini’s innocence.”

Read more …

Better do it fast.

Ten Cities Ask EU For Help To Fight Airbnb Expansion (G.)

Ten European cities have demanded more help from the EU in their battle against Airbnb and other holiday rental websites, which they argue are locking locals out of housing and changing the face of neighbourhoods. In a joint letter, Amsterdam, Barcelona, Berlin, Bordeaux, Brussels, Krakow, Munich, Paris, Valencia and Vienna said the explosive growth of global short-stay lettings platforms must be on the agenda of the next set of European commissioners. In April the advocate general of the European court of justice found in non-binding opinion that under EU law Airbnb should be considered a digital information provider rather than a traditional real estate agent.

That status, if confirmed by the court, would allow Airbnb and similar platforms to operate freely across the bloc and, crucially, relieve them of any responsibility to ensure that landlords comply with local rules aimed at regulating holiday lets. European cities believe homes should be used first and foremost for living in, the cities said in a statement released by Amsterdam city council. Many suffer from a serious housing shortage. Where homes can be rented out more lucratively to tourists, they vanish from the traditional housing market. The cities said local authorities must be able to counter the adverse effects of the boom in short-term holiday lets, such rising rents for full-time residents and the continuing touristification of neighbourhoods, by introducing their own regulations depending on the local situation .

“We believe cities are best placed to understand their residents needs”, they said. “They have always been allowed to regulate local activity through urban planning and housing rules. The advocate general seems to imply this will no longer be possible when it comes to internet giants”. After several years of strong growth, Airbnb currently has more than 18,000 listings in Amsterdam and Barcelona, 22,000 in Berlin and nearly 60,000 in Paris. Data from the campaign group InsideAirbnb last year suggested that more than half were whole apartments or houses, and that even in cities where short-term lets were restricted by local authorities, up to 30% were available for three or more months a year.

Many cities say the short-term holiday lettings boom is contributing to soaring long-term rents, although speculation and poor social housing provision are also factors. Last year Palma de Mallorca voted to ban almost all listings after a 50% increase in tourist lets was followed by a 40% rise in residential rents.

Read more …

The Big Burp.

The Dangerous Methane Mystery (CP)

The East Siberian Arctic Shelf (“ESAS”) is the epicenter of a methane-rich zone that could turn the world upside down. Still, the ESAS is not on the radar of mainstream science, and not included in calculations by the IPCC (Intergovernmental Panel on Climate Change), and generally not well understood. It is one of the biggest mysteries of the world’s climate puzzle, and it is highly controversial, which creates an enhanced level of uncertainty and casts shadows of doubt. The ESAS is the most extensive continental shelf in the world, inclusive of the Laptev Sea, the East Siberian Sea, and the Russian portion of the Chukchi Sea, all-in equivalent to the combined landmasses of Germany, France, Great Britain, Italy and Japan.

The region hosts massive quantities of methane (“CH4”) in frozen subsea permafrost in extremely shallow waters, enough CH4 to transform the “global warming” cycle into a “life-ending” cycle. As absurd as it sounds, it is not inconceivable. Ongoing research to unravel the ESAS mystery is found in very few studies, almost none, except by Natalia Shakhova (International Arctic Research Center, University of Alaska/Fairbanks) a leading authority, for example: “It has been suggested that destabilization of shelf Arctic hydrates could lead to large-scale enhancement of aqueous CH4, but this process was hypothesized to be negligible on a decadal–century time scale. Consequently, the continental shelf of the Arctic Ocean (AO) has not been considered as a possible source of CH4 to the atmosphere until very recently.”


[..] early-stage warning signals are clearly noticeable; ESAS is rumbling, increasingly emitting more and more CH4, possibly in anticipation of a “Big Burp,” which could put the world’s lights out, hopefully in another century, or beyond, but based upon a reading of her latest report in Geosciences, don’t count on it taking so long. Shakhova’s research is highlighted in a recent article in Arctic News: “When Will We Die?” d/d June 10, 2019, which states: “Imagine a burst of methane erupting from the seafloor of the Arctic Ocean that would add an amount of methane to the atmosphere equal to twice the methane that is already there.”

Read more …

 

 

 

 

May 262019
 


Joseph Mallord William Turner Teasing the Donkey 1827

 

So we’re going to do this all over again? Well, not if I can help it. Not that I have much hope that I can, mind you. As the bastions of war chime on, my voice, like so many others, will be drowned out. The military industrial complex knows how to do propaganda, better than anyone. But I’ll try.

Vietnam gave the US its biggest ever defeat, both militarily and morally, and yet mere years after its deeply humiliating withdrawal was put into action, the country was back at sending its promising young boys and girls not to its school systems, but to far away battle fields to be crippled, traumatized and slaughtered.

I know, I know, the UK and France do that too, but few other places do. Russia today uses its troops to defend its territory, China has yet to reveal its intentions. But the intentions of the US have been known ever since WWII ended.

In 1956, president Eisenhower, himself a longtime military man, warned the country upon taking leave of office, of the military-industrial complex that was threatening to take over its government. Less than 10 years later, that’s exactly what the complex did, and it’s never looked back.

And I’m thinking: you never learned anything at all? Not from Ike, not from Vietnam, not from the non-existent Iraqi WMD, and not from Libya or Syria? How is that even possible? Oh wait, I know, because the New York Times, Washington Post, CNN et al is where you get your so-called news. That’s why. Gotcha.

 

Today, May 26 2019, and I’m deeply ashamed to say it, I have two stories, one concerning a speech by VP Mike Pence at West Point, the other from Caitlin Johnstone about a Twitter thread initiated by the US military itself. Pence’s speech is heart breaking in its ignorance of US history, Caitlin’s is heart wrenching in its acknowledgment of that same history, and what it does to young Americans.

Now, I think this is not about Trump, as many will undoubtedly claim, it’s about Trump and Pelosi and Pence and McCain and Bolton and Hillary and Pompeo and Obama and all of the people hanging around both administrations. Let’s see what YOU think.

Pence To West Point Grads: You Will Fight On a Battlefield for America at Some Point in Your Life

Vice President Mike Pence told the graduating class of the West Point Military Academy on Saturday that the world is “a dangerous place” and they should expect to see combat. “Men and women of West Point, no matter where you’re deployed, you will be the vanguard of freedom, and you know that the “soldier does not bear the sword in vain.” The work you do has never been more important. America will always seek peace, but peace comes through strength. And you are now that strength. It is a virtual certainty that you will fight on a battlefield for America at some point in your life. You will lead soldiers in combat. It will happen.


Some of you will join the fight against radical Islamic terrorists in Afghanistan and Iraq. Some of you will join the fight on the Korean Peninsula and in the Indo-Pacific, where North Korea continues to threaten the peace, and an increasingly militarized China challenges our presence in the region. Some of you will join the fight in Europe, where an aggressive Russia seeks to redraw international boundaries by force. And some of you may even be called upon to serve in this hemisphere. And when that day comes, I know you will move to the sound of the guns and do your duty, and you will fight, and you will win. The American people expect nothing less.”

Mike Pence is a very dangerous person. He’s planning to send American children into endless wars once again, 45-odd years after Vietnam and 20-odd years after Iraq. And there’s no-one left to stop him, other than Trump, Not exactly a solid guarantee. The Democrats will cheer this on, and their media will too. They always have.

Now, I’m not old enough to remember the whole story of the US involvement in Vietnam, but I do recall this 1985 video from Paul Hardcastle, which stated that the average age of the US soldier in Vietnam -towards the end- was 19. I have also seen Coppola’s movie “Apocalypse Now”, and many others, and yes, I’m wondering where today’s versions of these movies are.

 

 

Because, you know, when I read the Twitter thread picked up by Caitlin Johnstone listing what was supposed to be a promo thing from the army, my heart sinks and hurts and in the end is downright defeated. It’s like reading the accounts from Vietnam, and nothing has changed in 50+ years. How can that be? Says innocent me.

But religious nut Mike Pence has the guts to present this as some sort of heroic thing. For young Americans to go die in a desert for nothing at all other than Exxon’s access to oil and the profits of Boeing and Raytheon. And of course they’ve been setting this up for decades, that young kids -certainly blacks- who have no shot at a proper education, can get one only if they agree to become cannon fodder.

That’s ‘Nam, guys, that’s the 1960’s, history. And just look at how terribly that failed. Well, Mike Pence would like to repeat that failure.

The US Army Asked Twitter How Service Has Impacted People. The Answers Were Gut-Wrenching.

After posting a video of a young recruit talking to the camera about how service allows him to better himself “as a man and a warrior”, the US Army tweeted, “How has serving impacted you?” As of this writing, the post has over 5,300 responses. Most of them are heartbreaking. “My daughter was raped while in the army,” said one responder. “They took her to the hospital where an all male staff tried to convince her to give the guy a break because it would ruin his life. She persisted. Wouldn’t back down. Did a tour in Iraq. Now suffers from PTSD.”

“I’ve had the same nightmare almost every night for the past 15 years,” said another. Tweet after tweet after tweet, people used the opportunity that the Army had inadvertently given them to describe how they or their loved one had been chewed up and spit out by a war machine that never cared about them. This article exists solely to document a few of the things that have been posted in that space, partly to help spread public awareness and partly in case the thread gets deleted in the interests of “national security”.

 

“my grandpa served in vietnam from when he was 18–25. he’s 70 now and every night he still has nightmares where he stands up tugging at the curtains or banging on the walls screaming at the top of his lungs for someone to help him. he refuses to talk about his time and when you mention anything about the war to him his face goes white and he has a panic attack. he cries almost every day and night and had to spend 10 years in a psychiatric facility for suicidal ideations from what he saw there.”

 

“My best friend joined the Army straight out of high school because his family was poor & he wanted a college education. He served his time & then some. Just as he was ready to retire he was sent to Iraq. You guys sent him back in a box. It destroyed his children.”

 

“My best friend from high school was denied his mental health treatment and forced to return to a third tour in Iraq, despite having such deep trauma that he could barely function. He took a handful of sleeping pills and shot himself in the head two weeks before deploying.”

If you got the stomach for it, guys, do read it. But I got to tell you, I find it hard.

The US killed millions of people and maimed ten times that in Vietnam, and that very much includes its own young and promising American citizens, and they did it again in Iraq. Mike Pence wants to repeat that in Iran and other theaters. Supported by Pelosi, Pompeo, Schumer, Bolton etc. Shame for them John McCain passed.

There’s only one US presidential candidate who’s explicitly spoken out against this mad repeat of Vietnam, and that’s Tulsi Gabbard, who actually “served” in Iraq. So she will be pushed aside by the DNC. Who are funded by the military industrial complex, don’t you know. Must serve the machine. We have a long way to go.

I always thought that Springsteen talking about Vietnam from Born In The USA is sort of like a haiku, encompassing the essence in just a few words, even if he doesn’t catch all the misery and bloodshed and mental anguish and broken lives and all of it (but how could you?):

 

I had a brother at Khe San;

Fighting off the Viet Cong

They’re still there, he’s all gone

He had a woman he loved in Saigon

I got a picture of him in her arms now

 

I know people older than me have many more examples of this and from the time when the ‘war’ was actually ongoing. Eve of Destruction? Creedence? Please send suggestions.

But also, please recognize the similarities in the madness then and now.

And let’s try and make it stop.

Let’s try and stop history from even rhyming, let alone repeating.

Nassim Taleb likes to point out that in olden days those who declared wars would also be first in line to fight them. By design. The fair thing to do.

Let’s send Mike Pence and Nancy Pelosi and Donald Trump and Chuck Schumer and Mike Pompeo and John Bolton and all of their families into Iran first. And then we can talk.

 

 

 

 

 

May 142018
 


Brassaï Cat 1945

 

What’s happening to John McCain is tragic. It’s not something one should ever wish upon another human being. Nor is it decent, let alone useful, to wish that he would die. Wishing bad things upon someone because they did bad things is too close for comfort to what he himself did. But it’s good to remember that his brain tumor is not the most tragic part of McCain’s life on earth. And no, neither is his time as prisoner of war in Vietnam.

McCain’s main tragedy is that he didn’t learn the one lesson he should have learned about his time in Vietnam, and didn’t turn his back on warfare. Instead, he turned into the biggest and loudest pro-war campaigner in Washington for decades. Talk about a missed opportunity, a life wasted. If there was one person who was presented with the first-hand experience needed to turn against bloodshed, it was John McCain.

What’s more, during his time in the House and later the Senate, McCain completely missed out on a development that might yet have changed his mind. That is, wars became unwinnable. Something even that the US losing their war in Vietnam might have taught him. It entirely passed him by. McCain still never saw an opportunity to wage battle somewhere, anywhere on the planet, that he didn’t like.

That makes him a dinosaur and a fossil who should never have been allowed to remain in the Senate for as long as he did. At the age of 81, and after ‘serving’ for 35 years in Washington, it apparently becomes too difficult to see how the world outside changes, let alone to adapt to those changes. If you limit the time a president can serve, why not do the same for senators? Is it because those same senators would have to vote on that?

Moreover, if wars are unwinnable, but you incessantly call for new wars anyway, then regardless of moral issues about going to war in the first place, you have de facto become a threat to your own people and your own country that you purport to serve. Especially, and first of all, to the American soldiers you desire to send out there to fight those wars. But also a threat to the image of America around the globe.

 

When wars are unwinnable, there is no reason to fight them. Again, even apart from morals and ethics. You will have to find other ways to deal with ‘elements’ that feel and act less than friendly towards you. To find out what, it helps to realize that they understand it’s just as futile for them to attack you militarily as it is for you to attack them. It also helps to figure out why they are unfriendly.

What doesn’t help is to take yet another stab at Putin and say “Vladimir Putin is an evil man, and he is intent on evil deeds”, as McCain does in a forthcoming book. If that’s the best you can do, your best-by date has long since passed. That’s language fit for a 4-year old. And George W.

McCain’s father and grandfather were both 4-star US Navy admirals. Perhaps that partly explains his blindness to the evils of war, and the role the US has played in many conflicts, including -but certainly not limited to- Vietnam. It’s hard to imagine Apocalypse Now, Platoon or Full Metal Jacket being McCain’s favorite Hollywood classics.

And that is a bigger problem than it may seem. Because America has indeed been able to paint a vivid portrait for itself of why Vietnam was such an insane venture that should never have happened, and certainly not repeated. If your culture has the ability to put that in words and images, and as a nation you still don’t learn the lesson embedded in them, you’re pretty much lost.

Oh, and besides, you lost too, remember? You lost the war and the lives and limbs of tens of thousands of young Americans and over a million Vietnamese. To have been part of that and then turn around and strive to be Washington’s premier warmonger, that’s just totally bonkers. Or worse. Has McCain been promoting war all this time because he subconsciously wanted to redo Vietnam but this time not lose?

 

Unwinnable wars are bad news for the weapons industry. They will deny the existence of even such a concept as long and as strongly as they can. Because if you can’t win a war, why wage them? There will continue to be technological developments, but there’s no “throughput”. You can fire some missiles into some desert somewhere from time to time, and that’s it.

The military-industrial complex is happy only -because most profitable- if and when guns and missiles and jets constantly need to be replaced because they’ve been lost in a theater of war, along with young Americans. McCain knows this better than most. And he knows the captains of this complex, both the military side and the weapons producers. Far too well.

Being as beholden as it is to the arms makers and dealers, has made America lose whatever edge it once had militarily. In the US weapons are developed and sold to generate the largest profits possible; in Russia, they are developed to protect the country. This is largely why the American defense budget is 10 times larger than its Russian counterpart. All this happened on John McCain’s watch.

The entire narrative of “protecting and sharing our values” has become hollow propaganda. Because the US has engaged its military in more theaters of war and invasion than we can even keep track of anymore. The US armed forces don’t protect democracy or human rights around the world, they protect the financial interests of America’s elites, including the military-industrial complex. Does anyone believe John McCain doesn’t know this?

 

Unbeknownst to John McCain, the world has entered a whole new era. And this didn’t happen yesterday. Russia and China may have only recently announced new hypersonic missile technology, but it didn’t fall out of the sky. It does profoundly change things though. It ends all notions and dreams of American exceptionalism and unilateralism.

And America needs to learn that lesson. It will have to do it without John McCain. And it might as well, because McCain was incapable of changing, and of seeing the changes around him. But the American view of the world will have to change, because the world itself has.

Still, you’re right: the real tragedy is not that John McCain wasted his own life. It’s that he helped destroy so many others.

 

 

Apr 142018
 
 April 14, 2018  Posted by at 9:54 am Finance Tagged with: , , , , , , , , , ,  8 Responses »


Robert Capa Anti-fascist militia women defending a street barricade, Barcelona 1936

 

US Media Love War More Than They Hate Trump (Khalek)
US Defence Secretary Mattis Says ‘This Was A One-Time Shot’ – For Now (Ind.)
Why Is ‘Bad Guy’ Putin So Popular At Home? (Steve Keen)
Trump’s Actions in Syria Violate US Constitution (Kucinich)
Long Wars (Claire Connelly)
The Deep State Takes A Hostage (Stockman)
Irish High Court Sets Out 11 Questions For ECJ on EU-US Data Transfers (IT)
Mark Zuckerberg’s Testimony Lurched From Easy Ride To Headache (G.)
Making America More Indebted (Roberts)
JPMorgan Profits Soar 35% Thanks To Donald Trump’s Tax Cuts (Ind.)

 

 

How many people actually believe the Skripal and Douma stories they are being fed?

US Media Love War More Than They Hate Trump (Khalek)

American media outlets can’t help themselves. They love war. They love war more than they hate Trump. They love war so much, they are cheering on the president they hate to militarily escalate in Syria. And if he doesn’t escalate in Syria, it proves he is controlled by the Kremlin, they tell us. If he wants to demonstrate that Russia isn’t calling the shots, he must bomb Syria. And he must bomb Syria to punish Assad for an alleged chemical attack that has yet to be properly investigated to determine whether it took place and who is responsible. The US media isn’t interested in evidence, they have been repeating that Assad was behind this alleged attack from the beginning and through repetition it has become a truth.

NBC recently published claims fed to them by anonymous US intelligence officials claiming to have proof that the attack did indeed take place and that Assad is responsible. It’s not as if US officials have ever lied about weapons of mass destruction in the past to justify war, so why should NBC be skeptical of this? Meanwhile, CNN—when it isn’t busy obsessing over Stormy Daniels—has hosted a parade of war hawks agitating for military escalation against Syria, against Iran, even against Russia. For example US Republican Senator Lindsey Graham, who has never seen a country he doesn’t want to bomb, was allowed to go on air and call Assad a legitimate military target, saying Trump should take him out to “send a strong message other bad actors like North Korea and Iran.”

He went largely unchallenged by the CNN host whose only qualm was where the US could bomb in Syria to properly punish the Assad government. “It’s tough to decide what option to hit. What is a good option? You’d be forced to take out the air force but it doesn’t sound like taking out the air force will stop if it’s chemical attacks coming out of a helicopter,” she said to Graham. The editorial board at the Washington Post, a newspaper that is owned by Amazon billionaire Jeff Bezos who has a $600 million contract with the CIA that is never disclosed by the paper on stories related to the intelligence agency despite the clear conflict of interest, agitated for Trump to go further than just bombing Syria once.

The Post wants to see a longer term plan for regime change and US military domination over Syria. “The reality Mr. Trump has not yet faced is that as long as the dictator he called “Animal Assad” remains in place, Syria’s wars will continue, breeding Islamist terrorists and propelling refugees toward Europe,” said the Post. But the reality is the opposite: it is the US’ war of regime change in Syria that has prolonged the war, bred Islamist terrorists, and propelled refugees toward Europe, and the Post is calling for continuing that regime change operation.

Read more …

The story is they struck chemical weapons facilities. That means the OPCW has zero credibility from now on; they stated just a few years ago that Syria had none anymore.

US Defence Secretary Mattis Says ‘This Was A One-Time Shot’ – For Now (Ind.)

The US military has revealed the three-nation stake on Syria targeting alleged chemicals assets is over for now – declaring “right now this is a one-time shot”. Defence Secretary James Mattis said the US, UK and France had acted together, having determined that Syrian leader Bashar al-Assad had used chemical weapons against civilians a week ago. He said it would depend on Mr Assad if there were further strikes. “Right now this is a one-time shot,” he told a briefing on Friday night at the Pentagon. The Chairman of the Joint Chiefs of Staff General Joseph Dunford, said the targets included a Syrian research facility, a chemical weapons storage facility and a command post. The first of these was located in Damascus, the first time that the US had struck close to the capital.

Asked whether the US and its allies was planning further attacks, Mr Mattis said: “That depends open Assad.” The Defence Secretary said he was “certain” the Syrian regime had used chemical weapons in an attack on civilians, something that Mr Assad and its Russian allies have denied. He said the US was still investigating what sort of chemical weapons had been used. “We are aware of one of the chemical agents” that was used, but further assessments were continuing. While it was reported that Russian forces were not warned in advance of the strike, he said that usual deescalation communications did go ahead, the process Moscow and Washington use to avoid unintentional attacks on each other’s forces, or accidental clashes or their aircraft.

Read more …

“..an extra 2.5-3 million Russian adults died in middle age in the period 1992-2001 than would have been expected based on 1991 mortality..”

Why Is ‘Bad Guy’ Putin So Popular At Home? (Steve Keen)

The destructive impact of the far-too-rapid transition was an increase in the mortality rate, which medical researchers concluded meant that “an extra 2.5-3 million Russian adults died in middle age in the period 1992-2001 than would have been expected based on 1991 mortality. ” In strict economic terms, the transition was an abject failure – that is, if you think it was intended to improve Russian living standards. GDP virtually halved between 1990 and 1998, living standards plummeted, crime proliferated, and Russian society almost collapsed. Even today, output is barely above pre-transition levels.n

The failure of the rapid transition policies forced on Russia by the US is even more apparent when Russia’s transition performance is compared with China’s, where the communists remained firmly in control, and where the transition was deliberately undertaken at a measured pace. Russia’s per capita GDP today is only slightly above its level at the end of the Soviet period. China’s per capita GDP is ten times what it was in 1990. However, viewed from the very bottom of this brutal process in 1998, Russia has made remarkable progress: from 1998 until now, GDP has more than doubled, in both total and per capita terms. For almost all of this time, Russia’s president or prime minister has been Vladimir Putin.

Prior to his election in 2000, Putin rose to prominence in part because of his successful repression of the Chechen revolt. This hardly endeared Putin to the Chechens. But it gave him the aura of a strongman at the time most Russians believed their country desperately needed one, to eliminate the low-level mafia who tormented the public directly, to subdue the Oligarchs who exploited them, and to stand up to the West when his predecessor Yeltsin had effectively been a puppet. Putin can’t be solely credited with starting the economic turnaround, but his strongman approach to running Russia was welcomed, and is still welcomed, by the majority of his countrymen.

Russia is far from perfect under Putin, and Putin is far from perfect himself. But its economy and its national pride have been restored under his rule, and the Russian public cannot be faulted for feeling substantial antipathy towards the West, and the US in particular. Given that Russia has legitimate grievances about how the West treated it after it decided to join the capitalist camp, and the disastrous outcomes of all previous Western attempts at regime change, I’d rather our so-called leaders aimed for rapprochement with Russia, and yes, with Putin, instead of heightened animosity.

Read more …

So what is Congress going to do?

Trump’s Actions in Syria Violate US Constitution (Kucinich)

President Trump acted without congressional authorization in ordering a military attack against Syria tonight. This is a clear violation of the United States Constitution, Article 1, Section 8 which makes it clear that only Congress has the power to declare war. The President’s Article II authority as “Commander in Chief” does not give him the authority to act independent of Congress on matters of war. This is not a mere technicality. The doctrine of separation of powers is the only thing which protects the US from becoming a dictatorship. The President is subject to the law. The gas attack on Douma must be dealt with in an international court of law. If the US does not stand for the rule of law, how can we demand other countries to do so?

The attack on Syria will embolden ISIS. Our military power should not be used to help, directly or indirectly, ISIS and those elements whose philosophy is inimical to the United States of America. The President has violated the Constitution, usurping the power of Congress. This is not about whether or not the President hates Syria’s leaders. It is about whether or not he loves the US Constitution, which he took an oath to defend. The President chose to order a military attack almost a week after the gas attack on Douma. He had plenty of time to seek congressional approval, but he chose not to do so, even though he himself specifically said “The President must get congressional approval before attacking Syria – big mistake if he does not.” (Twitter, August 30th, 2013).

Read more …

“.. the Arab world under the control of those who live and work in the Arab world.”

Long Wars (Claire Connelly)

From Syria, to Iraq, Iran to Libya, our understandings of the long-wars in the Middle-East as moral, humanitarian interventions designed to democratise and civilise are the result of a carefully crafted propaganda campaign waged by the US and its allies. Each of these uprisings were launched by US proxies, designed to destabilize the regions, justifying regime change that suit the economic interests of its investors, banks and corporations, captured comprehensively in a new book by Canadian author and analyst, Stephen Gowans, Washington’s Long War on Syria. You might be surprised to know that both the Libyan, Syrian and Iraqi government, led by Muammar Gaddafi, Hafez Al Assad, (succeeded by Bashaar Al Assaad) and Sadaam Hussein respectively, were socialist governments.

Or Ba’ath Arab Socialist governments, to be precise. Ba’ath Arab Socialism can be summed up in their constitutions supporting the values of: ‘freedom of the Arab world, freedom from foreign powers and freedom of socialism’. Its doctrine was supported in Libya, as it was in Iraq and Syria. Of course, particularly in Hussein’s case, we cannot claim that these governments were without their problems. Ethnic cleansing is not to be overlooked, but condemned on the strongest grounds. But of course these were not the reasons the US and its allies decided to get into it. “For the last quarter of a century, the US and its allies have waged highly destructive campaigns of economic warfare against Syria and Iraq, the economic equivalent of nuclear war,” writes Gowans,

“and have done so because they are opposed to Ba’ath Arab Socialist efforts to bring politics and the economics of the Arab world under the control of those who live and work in the Arab world.” In the case of Iraq, it had combined its oil wealth with public ownership of the economy, leading to what is known as ‘The Golden Age’, where, according to a State Department Official: “Schools, universities, hospitals, factories, museums and theatres proliferated employment so universal, a labour shortage developed.” When the Ba’ath Arab Socialists were driven from power in Iraq, the US installed military dictator, Paul El Briener who set about a ‘de-Ba’athification’ of the government, expelling every member of the Ba’ath Arab Socialist party and imposed a constitution forbidding any secular Arab leader from ever holding office in Iraq again.

Read more …

It ain’t over.

The Deep State Takes A Hostage (Stockman)

The Donald seems to be taking a Deep Breath on his Syria bombfest, but the Deep State has him by the orange hairs. So we doubt the delay will last much longer. That’s because our Art of the Deal genius is getting bamboozled yet again. They are telling him that wiping out up to a dozen Syrian airfields, military installations and a dog-eared factory or two that can be identified as chemical weapons sites will amount to some pretty serious Shock & Awe where it counts: That is, the mere witnessing of it will cause the Fat Boy of Pyongyang to brown his ample trousers, thereby getting his “mind right” for the upcoming summit. That’s exactly the kind of macho-bargainer stuff that the Donald thrives on, and is further proof that the Deep State has figured out exactly how to press his buttons.

To be sure, Trump is no innocent victim. He voluntarily made himself hostage to the War Party by surrounding himself with failed generals and the most rabid war-mongers to be found in the Imperial City—-John Bolton, Mike Pompeo and Gina Haspel. Indeed, you have to wonder. How could anyone with even a half-baked notion of America First think that a hard core interventionist like John Bolton should be brought up right close and personal to the POTUS ear lobes, Walrus mustache and all? But whatever the Donald was thinking when he made such horrendous choices for his top national security posts, these denizens of the War Party have wasted no time shoving their own agenda right down his throat.

And at the top of that agenda is systematic, relentless escalation of provocations against Russia and Iran. That’s because confrontation with these demonized states is the best way to keep Imperial Washington (and therefore the entire country) on a war-footing and the national security gravy train overflowing with fiscal largesse. As we indicated in Part 1, the impending attack on Syria is actually a shot across the bow aimed at Tehran and Moscow. The cover story is simply a humanitarian sounding ruse. Ostensibly, Bashar Assad is being administered a good hard spanking via a barrage of cruise missile birch switches.

That begs the question, of course, of how homeland security is actually enhanced by selectively spanking some malefactors and not others. In this case, even the surely bogus claim that 40 civilians were gassed in Douma hardly compares to the 10,000 civilians that have been slaughtered by American bombs delivered by the Saudi air force in Yemen; or the thousands of anti-government prisoners that have been summarily executed by General al-Sisi in Egypt under this stewardship of Washington’s $1.2 billion annual stipend; or the thousands of civilians that Israel has killed during its periodic “lawn-mowing” exercises on the Gaza Strip.

Read more …

Huge challenge to Facebook and the CIA. How come only the Irish Times reports on it? The EU top courts is about to ban transfer on personal data from Europe to the US.

Irish High Court Sets Out 11 Questions For ECJ on EU-US Data Transfers (IT)

Legal uncertainty surrounds the capacity of companies such as Facebook to transfer European users’ data to the US after a High Court judge asked the most senior EU court to consider 11 questions on the issue. The referral stems from a case taken by Austrian privacy activist Max Schrems. The questions raise significant issues of EU law with huge implications, including whether the High Court has correctly found there is “mass indiscriminate processing” of data by US government agencies under the PRISM and Upstream programmes authorised there. The questions also ask whether EU law applies to the processing of personal data for national security purposes regardless of whether that data processing takes place in the EU or US or other third country.

Other questions concern whether the Privacy Shield Decision and other measures in the US afford adequate protection for EU citizens whose data is transferred there. The ECJ is also asked to decide the extent of a data protection authority’s (DAA) power to suspend data flows if it considers a third country is subject to surveillance laws which conflict with EU law. After Ms Justice Caroline Costello set out the questions on Thursday in a formal request to the ECJ for a preliminary ruling, Paul Gallagher SC, for Facebook, asked for time to consider that in the context of possibly seeking an appeal against the judge’s decision to make a reference to the CJEU in the first place.

Michael Collins SC, for the Data Protection Commissioner (DPC), queried whether there was any entitlement to appeal a High Court decision to direct a reference but did not object to Facebook being given a short time to consider its approach. The judge, noting she had given judgment last October sanctioning a reference, said she was anxious to make the referral but would allow Facebook time to April 30th. Among the questions for reference include whether, when deciding if data privacy rights of an EU citizen are breached, the issue must be examined against the EU Charter and EU law or the national law of one or more EU states, or an amalgam of the laws of all member states. The High Court had found the appropriate comparator was EU law despite Facebook disputing that.

Read more …

The challenege is in Europe, not the US.

Mark Zuckerberg’s Testimony Lurched From Easy Ride To Headache (G.)

As Mark Zuckerberg left Congress on Tuesday after testifying to the Senate, he may have felt relieved. The four-hour Q&A session had been largely dominated by mundane questions of fact about how Facebook works, requests for apologies and updates he had already given and was happy to repeat, and shameless begs for the social network’s cash pile to be used to expand broadband access in senators’ home states. Less than 24 hours later, however, a very different pattern of questioning in front of 54 members of the House of Representatives suggested a much more worrying outcome for Facebook – that this could be the week its crisis moves from being about mistakes in the past to inherent problems in the present.

Perhaps, the representatives implied, Facebook doesn’t just have a problem. What if it is the problem? Questions were still asked about Cambridge Analytica, the 9m other apps the company has to investigate for historical data sharing, and the revelation that more than a billion users had their data scraped by third parties abusing a phone or email lookup feature. But just as many were asked about problems that revolved less around mistakes and more around fundamental facets of Facebook’s business. Unsurprisingly, Zuckerberg appeared less inclined to answer those. “Will you make the commitment to change … all the user default settings to minimise, to the greatest extent possible, the collection and use of users’ data,” asked Frank Pallone, the panel’s top Democrat.

Zuckerberg, declining to give a yes or no, eventually agreed to follow up with an answer after the hearing. “Are you willing to change your business model in the interest of protecting individual privacy,” asked the Democratic congresswoman Anna Eshoo. “I’m not sure what that means,” was Zuckerberg’s reply. Europe’s general data protection regulation, Democrat Gene Green noted, gives EU citizens the right to opt out of the processing of their personal data for marketing purposes. “Will the same right … be available to Facebook users in the United States?” Zuckerberg: “Let me follow up with you on that.”

Read more …

“..an additional dollar of deficit spending will reduce private GDP by $1.01, resulting in a one-cent decline in real GDP..”

Making America More Indebted (Roberts)

In December of last year, as Congress voted to pass the “Tax Cut & Jobs Act,” I wrote that without “real and substantive cuts to spending,” the debt and deficits will begin to balloon. At that time, I mapped out the trajectory of the deficit based on the cuts to revenue from lower tax rates and sustained levels of government spending.

Since that writing, the government has now lifted the “debt ceiling” for two years and passed a $1.3 Trillion “omnibus spending bill” to operate the government through the end of September, 2018. Of course, since the government has foregone the required Constitutional process of operating on a budget for the last decade, “continuing resolutions,” or “C.R.s,” will remain the standard operating procedure of managing the country’s finances. This means that spending will continue to grow unchecked into the foreseeable future as C.R.’s increase the previously budgeted spending levels automatically by 8% annually. (Rule of 72 says spending doubles every 9-years) The chart below tracks the cumulative increase in “excess” Government spending above revenue collections. Notice the point at which nominal GDP growth stopped rising.

Trillion dollar deficits, of course, are nothing to be excited about as rising debts, and surging deficits, as shown, impede economic growth longer-term as money is diverted from productive investments to debt-service. While many suggest that “all government spending is good spending,” the reality is that “recycled tax dollars” have a very low, if not negative, “multiplier effect” in the economy. As Dr. Lacy Hunt states: “The government expenditure multiplier is negative. Based on academic research, the best evidence suggests the multiplier is -0.01, which means that an additional dollar of deficit spending will reduce private GDP by $1.01, resulting in a one-cent decline in real GDP. The deficit spending provides a transitory boost to economic activity, but the initial effect is more than reversed in time. Within no more than three years the economy is worse off on a net basis, with the lagged effects outweighing the initial positive benefit.“

Read more …

Oh boy, are we doing great.

JPMorgan Profits Soar 35% Thanks To Donald Trump’s Tax Cuts (Ind.)

JPMorgan’s profits jumped 35 percent in the last quarter, compared to a year ago, partly thanks to a huge tax cut. Congress slashed the corporate tax rate from 35 per cent to 21 per cent in December as part of a major overhaul pushed for by President Donald Trump that also cut taxes for wealthy individuals. Higher interest rates also helped to boost profits, JPMorgan said. The bank earned $8.7bn (£6.1bn) in the first quarter, or $2.37 a share, up from $6.45bn, in the same period a year earlier. Analysts had predicted JPMorgan would earn $2.28 a share.

Pre-tax income rose by $2.6bn to $28.52bn in the quarter, the company paid $240 million less in taxes compared to a year earlier. “2018 is off to a good start with our businesses performing well across the board, driving strong top-line growth and building on the momentum from last year,“ chief executive Jamie Dimon said. “The global economy continues to do well, and we remain optimistic about the positive impact of tax reform in the US as business sentiment remains upbeat, and consumers benefit from job and wage growth.”

Read more …

Apr 112018
 


Jan van Eyck The Last Judgement (detail) 1430

 

Hussman’s Script For A 60% Tumble In The Stock Market (MW)
World Trade System In Danger Of Being Torn Apart – Lagarde (G.)
Eurocontrol Warns Airlines Of Possible Missile Strikes Into Syria (R.)
Russian Envoy: Any US Missiles Fired At Syria Will Be Shot Down (R.)
We All Need To Unite Against War In Syria (CJ)
Zuckerberg Deflects Senators’ Questions, Gets $3 Billion For The Effort (MW)
Ban Targeted Advertising (Dayen)
EU Top Court Backs France Ban Of Uber (AFP)
Barclays Says Bitcoin Behaves Like An Infectious Disease (BBG)
The Failures of Anti-Trumpism (NYT)
Save the Children Faces Formal Investigation Over Staff Misconduct (G.)
Greece at Bottom of Eurozone Growth Rate (GR)
More Than Half Your Body Is Not Human (BBC)

 

 

“Investment is about valuation. Speculation is about psychology,” Hussman said. “Both factors are unfavorable here.”

Hussman’s Script For A 60% Tumble In The Stock Market (MW)

Enjoy days like this while they last, warns longtime bear John Hussman, because the volatility we’re seeing on the Dow and the S&P 500 only serves to reinforce his pessimistic view that the stock market is careening toward a painful drop of at least 60% and a decade or more of zero to negative returns. “We’re observing the very early effects of risk-aversion in a hypervalued market,” the Hussman Trust president wrote in his latest missive. “To some extent, the actual news events are irrelevant. I certainly wouldn’t gauge market risk by monitoring the day-to-day news on potential tariffs or even prospects for rate changes by the Fed.”

For those of you feeling a bit queasy because of what Hussman describes as the “rather minimal level of volatility” we’ve seen lately, it’s time to make some changes and rebalance your portfolio with some hedges, or at least lighten up by adding cash. “But do so knowing one thing in advance: you will experience regret,” he says. “If the market advances after you rebalance, you’ll regret having sold anything. If the market declines after you rebalance, you’ll regret not having sold more.”

The driving factor he frequently cites for the top-heavy market is that the Fed’s quantitative easing has inflated valuations to unsustainable levels, and as the free money goes away, the bottom will fall out, leaving a trail of blown-up investors in its wake. “Investment is about valuation. Speculation is about psychology,” Hussman said. “Both factors are unfavorable here.” He used this chart or the median price/revenue ratio of S&P components to show just how overvalued stocks are at this point, even after the recent tumble:

Read more …

Because the trade system benefits everyone, right?

World Trade System In Danger Of Being Torn Apart – Lagarde (G.)

The head of the IMF has warned of “darker clouds looming” for the global economy amid simmering trade tensions between the US and China, urging governments around the world to steer clear of protectionism or face negative consequences. Christine Lagarde said the current system for world trade was “in danger of being torn apart”, with the potential to upset the present global economic upswing and make consumers poorer. Speaking in Hong Kong amid signs the standoff could be abating, Lagarde said it would be an “inexcusable, collective policy failure” for world trade to break down with nations erecting punitive tariff systems against their rivals. “Let us redouble our efforts to reduce trade barriers and resolve disagreements without using exceptional measures,” she said.

[..] Using language that could be interpreted as a veiled attack on Trump in the speech ahead of the meeting, Lagarde said nations could make domestic policy changes to address trade imbalances and use international forums to settle disputes. “We can all do more – but we cannot do it alone,” she said. “Unfair trade practices have little impact on a country’s overall trade deficit with the rest of the world. That imbalance is driven by the fact that a country spends above its income.” Identifying the US as an example of a nation that could benefit from reforms, she said Washington could help tackle its trade imbalances by gradually curbing public spending and by increasing revenue, which she said would help reduce future fiscal deficits.

Read more …

Jamming.

Eurocontrol Warns Airlines Of Possible Missile Strikes Into Syria (R.)

Pan-European air traffic control agency Eurocontrol on Tuesday warned airlines to exercise caution in the eastern Mediterranean due to the possible launch of air strikes into Syria in next 72 hours. Eurocontrol said that air-to-ground and/or cruise missiles could be used within that period and there was a possibility of intermittent disruption of radio navigation equipment. U.S. President Donald Trump and Western allies are discussing possible military action to punish Syria’s President Bashar Assad for a suspected poison gas attack on Saturday on a rebel-held town that long had held out against government forces.

Trump on Tuesday canceled a planned trip to Latin America later this week to focus instead on responding to the Syria incident, the White House said. Trump had on Monday warned of a quick, forceful response once responsibility for the Syria attack was established. The Eurocontrol warning on its website did not specify the origin of any potential missile threat. “Due to the possible launch of air strikes into Syria with air-to-ground and/or cruise missiles within the next 72 hours, and the possibility of intermittent disruption of radio navigation equipment, due consideration needs to be taken when planning flight operations in the Eastern Mediterranean/Nicosia FIR area,” it said, referring to the designated airspace.

Read more …

Clear as that.

Russian Envoy: Any US Missiles Fired At Syria Will Be Shot Down (R.)

Russia’s ambassador to Lebanon said any U.S. missiles fired at Syria would be shot down and the launch sites targeted, a step that could trigger a major escalation in the Syrian war. Russian Ambassador Alexander Zasypkin, in comments broadcast on Tuesday evening, said he was referring to a statement by Russian President Vladimir Putin and the Russian armed forces chief of staff. The Russian military said on March 13 that it would respond to any U.S. strike on Syria, targeting any missiles and launchers involved in such an attack. Russia is Syrian President Bashar al-Assad’s most powerful ally.

The United States and its allies are considering whether to hit Syria over a suspected poison gas attack that medical relief organizations say killed dozens of people in the rebel-held town of Douma near Damascus on Saturday. “If there is a strike by the Americans, then…the missiles will be downed and even the sources from which the missiles were fired,” Zasypkin told Hezbollah’s al-Manar TV, speaking in Arabic. He also said a clash “should be ruled out and therefore we are ready to hold negotiations”.

Read more …

Yes, we do. But it’s very late in the game.

We All Need To Unite Against War In Syria (CJ)

Last night Fox’s Tucker Carlson did what may have been the most amazing thing that has ever happened on American television. As the drums of war beat louder than they have in years, Carlson stared right into the camera and did the exact opposite of what every mainstream US pundit is doing right now: he told the truth. He told the truth about Syria. He told the truth about Yemen. He told the truth about the alleged chemical weapons attack in Douma. He told the truth about the bipartisan war machine which drops all pretense of opposition the instant it’s time for bloodshed. He told the truth about what war is, what it costs, and what it does to our world.

He stood in stark, unequivocal opposition to the trajectory the Trump administration appears to be moving along. And he did it on Fox News. I have a deep and abiding hatred in my heart for Fox News and all things Murdoch. I will never forget nor forgive the key role the Murdoch press played in deceiving our world into the unimaginable evil that was the Iraq invasion. But if I’d held a reflexive rejection of anything with the Fox News logo in the corner, I never would have seen Carlson’s epic monologue, never would have shared it with my social media following, never would have embedded it in this article, and this bright flash of truth would have been diminished by that much in the impact it was able to have on public consciousness.

And I know that there are many leftists who declined to help spread awareness of that Carlson monologue based solely on the fact that he’s a conservative pundit on a conservative network who has said things they disagree with in the past. This is stupid. We should be able to throw any weapon at all at the war machine, not fight with one hand tied behind our backs just because we don’t like conservatives.

Read more …

It was even worse than imagined.

Zuckerberg Deflects Senators’ Questions, Gets $3 Billion For The Effort (MW)

Mark Zuckerberg has come far since the early days of Facebook, and that growth was extremely apparent in how deftly the chief executive dealt with several hours of inscrutable questioning by U.S. senators Tuesday over the social network’s role in presidential election-meddling and the Cambridge Analytica data scandal. Wearing a conservative suit and light blue tie, an outfit he would rarely wear in Silicon Valley, Zuckerberg sat ramrod straight in his witness chair for most of the many hours of questions. He responded to each questioner by first addressing them as senator or chair. He looked earnest and serious for almost every question, even during some of the laughable questions from some of the less tech-savvy members of the Senate, such as the one by Sen. Orrin Hatch, who asked how Facebook makes money if it doesn’t charge users anything.

“Senator, we run ads,” Zuckerberg said with a smile. That calm response was in marked contrast to when Zuckerberg faced another type of grilling, at the All Things D conference in 2010, when he gave vague and rambling answers about Facebook’s changes to its privacy controls at the time, and had to take off his famous hoodie while wiping sweat from his face under the lights on stage. Part of his preparedness for the Senate hearing, where he managed to repeat several core phrases that the company has been perpetuating in the media, came as a result of Facebook’s information bombardment over the past month.

Some of the company’s obvious talking points have been repeated throughout the past weeks, such as how sorry Zuckerberg is, how much control Facebook users actually do have over their own data, how Facebook is trying to build a positive community and constant reminders of how the company started in a Harvard University dorm when he was 19. According to the New York Times, Facebook hired a team of experts to give Zuckerberg — who can be combative and defensive — a crash course in humility and charm ahead of the hearing in sessions that included mock hearings with its communications team and outside advisers. That preparation paid off: After the first two hours of questions were nearing an end and there was a call for a potential break, Zuckerberg took a sip of water and said he could keep going for a bit longer.

Read more …

Exactly. Stop that and all the Facebok nonsense stops. But those in power don’t want it to stop.

Ban Targeted Advertising (Dayen)

For the first 35 years of my life, like most Americans, I was exposed to lots of advertising. I absorbed billboards and print ads and direct mailers and television commercials and radio jingles. I learned about available products and services, and chose which ones I wanted. Some businesses I patronized survived and others didn’t. The economy mostly proceeded apace. Then, over the last decade, this form of marketing became seen as insufficient—or rather, the rise of digital media made a more invasive form of marketing too irresistible. Instead of having to cast a wide net in searching for potential customers, advertisers now could know every intimate detail about those customers beforehand.

They began targeting people geographically and behaviorally, based on common interests or things they liked in social media or what they wrote in emails to friends. The surveillance economy was born. The surveillance economy should die. This manner of advertising doesn’t serve the public and it’s not even clear it serves advertisers. It facilitates monopoly, as those with the biggest data troves receive all the ad dollars. That centralizes the potential for and magnitude of abuse, with Big Data used to discriminate against groups, steer vulnerable people to financial scams, and meddle in U.S. elections.

Cambridge Analytica’s scraping of 87 million user profiles through a simple personality quiz, and then weaponizing that information on behalf of Donald Trump’s presidential campaign, revealed how information on social media is inherently insecure. Now Facebook CEO Mark Zuckerberg is appearing before Congress on Tuesday to explain how this won’t happen again. But instead of leaving regulation to Facebook, or devising one Rube Goldberg scenario after another to try to protect consumer data, the U.S. can take one simple, legal step to roll back this dystopian nightmare: ban targeted advertising.

Read more …

App or transport?

EU Top Court Backs France Ban Of Uber (AFP)

The EU’s top court on Tuesday backed the right of member states like France to ban a service by ridesharing firm Uber without notifying Brussels, in a fresh setback to the US giant. The European Court of Justice ruled in favour of France’s ban of the UberPop service, which links amateur drivers with customers, comparing it to a December decision backing traditional taxi firms in the Spanish city of Barcelona. “Member States may prohibit and punish, as a matter of criminal law, the illegal exercise of transport activities in the context of the UberPop service, without notifying the Commission in advance,” the European Court of Justice ruled. [..]

Uber France is facing criminal proceedings in a court in the northern French city of Lille for its UberPop service. It argues that member states like France were required to notify the European Commission about the criminal legislation under which the case was brought because it concerned a technical regulation of an information society service. But the court of justice said the French case resembled one it ruled on in December when it classified Uber as an ordinary transportation company instead of an app and should be regulated as such. “In the Court’s view, the UberPop service offered in France is essentially identical to the service provided in Spain,” the court of justice statement said.

Read more …

True or not, a nice angle.

Barclays Says Bitcoin Behaves Like An Infectious Disease (BBG)

Is the rise of Bitcoin analogous to the spread of an infectious disease? Analysts at Barclays saw enough similarities to develop a pricing model for the cryptocurrency that takes its cues from the world of epidemiology. Their diagnosis: Bitcoin has probably peaked. The Barclays model divides the pool of potential Bitcoin investors into three groups: susceptible, infected and immune. It assumes that as prices rise, “infections” spread by word-of-mouth (nobody likes missing out when their friends and colleagues are getting rich). Barclays analysts led by Joseph Abate in New York explained the rest in a note to clients on Tuesday:

“As more of the population become asset holders, the share of the population available to become new buyers – the potential ‘host’ population – falls, while the share of the population that are potential sellers (‘recoveries’) increases. Eventually, this leads to a plateauing of prices, and progressively, as random shocks to the larger supply population push up the ratio of sellers to buyers, prices begin to fall. That induces speculative selling pressure as price declines are projected forward exponentially.” A similar dynamic plays out with infectious diseases when the so-called immunity threshold is reached, “the point at which a sufficient portion of the population becomes immune such that there are no more secondary infections,” the analysts wrote.

Read more …

Does David Brooks realize that anti-Trumpism, of which he’s a proud supporter, is what won Da Doland da election?

The Failures of Anti-Trumpism (NYT)

Over the past year, those of us in the anti-Trump camp have churned out billions of words critiquing the president. The point of this work is to expose the harm President Trump is doing, weaken his support and prevent him from doing worse. And by that standard, the anti-Trump movement is a failure. We have persuaded no one. Trump’s approval rating is around 40%, which is basically unchanged from where it’s been all along. We have not hindered him. Trump has more power than he did a year ago, not less. With more mainstream figures like H. R. McMaster, Rex Tillerson and Gary Cohn gone, the administration is growing more nationalist, not less. We have not dislodged him.

For all the hype, the Mueller investigation looks less and less likely to fundamentally alter the course of the administration. We have not contained him. Trump’s takeover of the Republican Party is complete. 89% of Republicans now have a positive impression of the man. According to an NBC News/Wall Street Journal poll, 59% of Republicans consider themselves more a supporter of Trump than of the Republican Party. On trade, immigration, entitlement reform, spending, foreign policy, race relations and personal morality, this is Trump’s party, not Reagan’s or anyone else’s. A lot of us never-Trumpers assumed momentum would be on our side as his scandals and incompetences mounted. It hasn’t turned out that way.

I almost never meet a Trump supporter who has become disillusioned. I often meet Republicans who were once ambivalent but who have now joined the Trump train. National Review was once staunchly anti-Trump, and many of its writers remain so, but, tellingly, N.R. editor Rich Lowry just had a column in Politico called “The Never Trump Delusion” arguing that Trump is not that big a departure from the Republican mainstream. The surest evidence of Trump’s dominance is on the campaign trail. As The Times’s Jonathan Martin reported, many Republicans, including Ted Cruz, are making the argument that if Democrats take over Congress, they will impeach the president. In other words, far from ignoring Trump, these Republicans are making defending him the center of their campaigns.

Read more …

Et tu, Brute?

Save the Children Faces Formal Investigation Over Staff Misconduct (G.)

Save the Children, the global charity mired in allegations that it failed to investigate sexual abuse and inappropriate behaviour by staff, is to be formally investigated by the Charity Commission. In a statement announcing a statutory inquiry, the commission said it had been prompted by “concerns about the charity’s handling, reporting and response to serious allegations of misconduct and harassment against senior staff members in 2012 and 2015”. The commission describes a statutory inquiry as its “most serious form of engagement” with a charity.

The news, announced on Tuesday night, will be another blow for the charity two months after it emerged that both Justin Forsyth, its former chief executive, and Brendan Cox, the former policy director and widower of the MP Jo Cox, left the charity in 2015 following allegations of misconduct. The two men knew each other from their years working for Gordon Brown and the Labour party. After he left Save the Children, Forsyth went on to a senior role at Unicef. He resigned in February after the reports of inappropriate behaviour emerged. Cox also resigned from the charities More in Common and the Jo Cox Foundation, set up in the aftermath of his wife’s murder.

The commission, which itself has been criticised for failing to follow up allegations involving the charities it polices, has been working with Save the Children since the facts about Forsyth and Cox emerged in the wake of the scandal involving Oxfam workers in Haiti. Save the Children is already reviewing its workplace culture and the implementation of recommendations made by a previous review. But the Charity Commission said its recent work with it, and new information from other sources that has recently come into the regulator’s possession, meant that the commission wanted to make further inquiries.

Read more …

It’s crazy to think the Greek economy is growing.

Greece at Bottom of Eurozone Growth Rate (GR)

Greece’s growth was the lowest among eurozone countries for 2017, with a GDP rise of just 1.4% while the eurozone average was 2.3%, according to European Central Bank figures. The ECB annual report released on Monday showed Ireland at the top of the growth chart among eurozone member states with a 5% GDP increase. Overall, 2017 was a year of growth for the whole of the single-currency bloc. According to the report, the main reason Greece fared so low in 2017 was that it showed only 0.1% growth in private consumption, compared to an average 1.6% increase in the rest of eurozone states.

At the same time, Greece showed a 1.1% decline in government spending, while the average in the euro area was a 1.2% increase. In terms of per capita GDP at current prices and adjusted for the cost of living, Greeks have an average annual income of €19,900 ($24,527) compared to €54,600 for each Irish citizen. In Portugal, average income amounted to €23,100, compared to €18,100 before the economic crisis. In Cyprus, the average income was €24,600 compared to €29,900 before the crisis. The “before the economic crisis” figures refer to the 1999-2008 period. On average in the euro area, per capita GDP stood at €31,700 according to the latest figures (2016), compared to €24,400 before the crisis.

Read more …

Bugs as drugs. “Originally it was thought our cells were outnumbered 10 to one.”

Well, our genes are outnumbered 1000 to 1.

More Than Half Your Body Is Not Human (BBC)

More than half of your body is not human, say scientists. Human cells make up only 43% of the body’s total cell count. The rest are microscopic colonists. Understanding this hidden half of ourselves – our microbiome – is rapidly transforming understanding of diseases from allergy to Parkinson’s. The field is even asking questions of what it means to be “human” and is leading to new innovative treatments as a result. “They are essential to your health,” says Prof Ruth Ley, the director of the department of microbiome science at the Max Planck Institute, “your body isn’t just you”. No matter how well you wash, nearly every nook and cranny of your body is covered in microscopic creatures.

This includes bacteria, viruses, fungi and archaea (organisms originally misclassified as bacteria). The greatest concentration of this microscopic life is in the dark murky depths of our oxygen-deprived bowels. Prof Rob Knight, from University of California San Diego, told the BBC: “You’re more microbe than you are human.” Originally it was thought our cells were outnumbered 10 to one. “That’s been refined much closer to one-to-one, so the current estimate is you’re about 43% human if you’re counting up all the cells,” he says. But genetically we’re even more outgunned. The human genome – the full set of genetic instructions for a human being – is made up of 20,000 instructions called genes. But add all the genes in our microbiome together and the figure comes out between two and 20 million microbial genes.

[..] Antibiotics and vaccines have been the weapons unleashed against the likes of smallpox, Mycobacterium tuberculosis or MRSA. That’s been a good thing and has saved large numbers of lives. But some researchers are concerned that our assault on the bad guys has done untold damage to our “good bacteria”. Prof Ley told me: “We have over the past 50 years done a terrific job of eliminating infectious disease. “But we have seen an enormous and terrifying increase in autoimmune disease and in allergy. “Where work on the microbiome comes in is seeing how changes in the microbiome, that happened as a result of the success we’ve had fighting pathogens, have now contributed to a whole new set of diseases that we have to deal with.”

Read more …

Mar 042018
 


James McNeill Whistler Nocturne: Blue and Silver – Chelsea 1871

 

Global Bond Markets Have Become Grotesquely Distorted – Jim Grant (ZH)
From Currency War To Trade War To Shooting War (Rickards)
Central Banks Are The Agents Of Baby Boomers (G.)
Osborne’s Austerity Has Left UK Social Fabric In Tatters (Pettifor)
How America’s Clean Coal Dream Unravelled (G.)
Putin’s Megyn Kelly Interview (ZH)
Germany’s SPD Votes For Coalition Handing Merkel Fourth Term (G.)
Europe’s Band-Aid Ensures Greece’s Debt Bondage (Varoufakis)
Modern Food Farming Puts UK Wildlife Species At Risk Of Extinction (Ind.)
Three Billboards In Hollywood, California (TAM)

 

 

It’s all just one giant distortion.

Global Bond Markets Have Become Grotesquely Distorted – Jim Grant (ZH)

Jim Grant, the world’s most famous interest rate observer, ventured on CNBC this week to expose and explain the utterly farcical world of financial markets (and in particular, risk assets) and how grotesquely distorted global bond markets have become. He began with an example… “As an example of where the world is mispricing interest rates… look to Italy, which is having a big [potentially disruptive] election on Sunday… …there is a speculative grade Italian security, Telecom Italia, the 5 1/4’s of 2022 are trading at 0.61 percent, that is a junk bond with a zero handle.” This bond traded with almost a 6 handle just 5 years ago… Thank you Mr Draghi. But it doesn’t stop there, Grant warns…

“…and since interest rates are critical in the pricing of financial instruments, these distortions preceded the uplift in all asset values.. and the manifestation of this manipulation is in many ways responsible for what we are now seeing in the markets.” These distortions and the chaotic aftermath of their withdrawal are exactly what current Fed Chair Powell warned of in 2013… “[W]hen it is time for us to sell, or even to stop buying, the response could be quite strong; there is every reason to expect a strong response. So there are a couple of ways to look at it. It is about $1.2 trillion in sales; you take 60 months, you get about $20 billion a month. That is a very doable thing, it sounds like, in a market where the norm by the middle of next year is $80 billion a month. Another way to look at it, though, is that it’s not so much the sale, the duration; it’s also unloading our short volatility position.

“I think we are actually at a point of encouraging risk-taking, and that should give us pause. Investors really do understand now that we will be there to prevent serious losses. It is not that it is easy for them to make money but that they have every incentive to take more risk, and they are doing so. Meanwhile, we look like we are blowing a fixed-income duration bubble right across the credit spectrum that will result in big losses when rates come up down the road. You can almost say that that is our strategy.”

Read more …

But history merely rhymes.

From Currency War To Trade War To Shooting War (Rickards)

Currency wars do not exist all the time; they arise under certain conditions and persist until there is either systemic reform or systemic collapse. The conditions that give rise to currency wars are too much debt and too little growth. In those circumstances, countries try to steal growth from trading partners by cheapening their currencies to promote exports and create export-related jobs. The problem with currency wars is that they are zero-sum or negative-sum games. It is true that countries can obtain short-term relief by cheapening their currencies, but sooner than later, their trading partners also cheapen their currencies to regain the export advantage. This process of tit-for-tat devaluations feeds on itself with the pendulum of short-term trade advantage swinging back and forth and no one getting any further ahead.

After a few years, the futility of currency wars becomes apparent, and countries resort to trade wars. This consists of punitive tariffs, export subsidies and nontariff barriers to trade. The dynamic is the same as in a currency war. The first country to impose tariffs gets a short-term advantage, but retaliation is not long in coming and the initial advantage is eliminated as trading partners impose tariffs in response. Despite the illusion of short-term advantage, in the long-run everyone is worse off. The original condition of too much debt and too little growth never goes away. Finally, tensions rise, rival blocs are formed and a shooting war begins. The shooting wars often have a not-so-hidden economic grievance or rationale behind them.

The sequence in the early 20th century began with a currency war that started in Weimar Germany with a hyperinflation (1921–23) and then extended through a French devaluation (1925), a U.K. devaluation (1931), a U.S. devaluation (1933) and another French/U.K. devaluation (1936). Meanwhile, a global trade war emerged after the Smoot-Hawley tariffs (1930) and comparable tariffs of trading partners of the U.S. Finally, a shooting war progressed with the Japanese invasion of Manchuria (1931), the Japanese invasion of Beijing and China (1937), the German invasion of Poland (1939) and the Japanese attack on Pearl Harbor (1941). Eventually, the world was engulfed in the flames of World War II, and the international monetary system came to a complete collapse until the Bretton Woods Conference in 1944.

Read more …

We’re going to be watching this unfold until it’s too late.

Central Banks Are The Agents Of Baby Boomers (G.)

The greatest threat to our economy comes from its ageing population. With the baby-boomer generation making up a large proportion of society, we find ourselves in a situation where public policy is mostly geared towards shoring up the gains made by boomers over the past 40 years, and industrial disputes are driven by an ageing union membership most worried about its pension entitlements. It is a problem that Britain shares with its continental cousins, the US and Japan, now that all are struggling with a situation where a fifth of their populations is aged over 65 and the proportion is rising fast. Ageing populations have many effects on an economy, not least the desire among those nearing retirement age to save excessively.

Each country’s baby boomers pursue the holy grail of wealth slightly differently, but in the main, property and pensions are the twin pillars supporting decades of retirement. When wealth is your goal, there is one evil monster that needs slaying, and that is inflation. This is one of the main reasons that since the 1990s the Bank of England is under instruction to keep inflation anchored around 2%. A recent blog by economists at the Bank has caused a stir by arguing that far from the baby-boomer savings glut being a passing phase – or at least a situation that will fade as the boomers die off – it will be with us for decades to come.

They argue that boomers have shown that they want to keep saving even as they move into their 80s and 90s, to fund possible extra health and care costs, and to pass on the maximum amount of wealth they can to their heirs. Some academics have argued that boomers will be forced to spend more than they save in later life to pay for health and long-term care, but that doesn’t appear to be happening. The $100 trillion of savings sloshing round the global financial system just keeps growing. This is not just because people in young nations such as Indonesia and India are starting to build up savings, but because older Brits, Germans and Swedes are doing the same when there had been an expectation that they would switch to spending.

[..] The Bank of England blog argues that the persistent glut of savings in stocks, bonds and property will maintain the trend of the past 30 years – of an excess of money chasing too few investment opportunities. And if older savers resist spending some of their pension, demand for goods is lower than expected, and inflation stays low. Central banks, in seeking to maintain a 2% inflation target, are the agents of baby boomers. It is their savings and wealth that are protected, not those of the young, who have much less, if any.

Read more …

This is not typical for Osborne or the UK. ‘Saving’ the economy by making the poor, poorer, is widely accepted.

Osborne’s Austerity Has Left UK Social Fabric In Tatters (Pettifor)

There is growing consensus among economists that Osborne’s post-crisis austerity programme deepened and lengthened Britain’s post-crisis recession, causing public and private investment to fall further and real wages to decline. Making large reductions to government spending is itself a major reason why the economy has been so slow in recovering. (Consider the multiplier effect where an injection of public money helps generate income and tax revenues.) In his first budget (June 2010) Osborne told parliament: “We are on track to have debt falling and a balanced structural current budget by the end of this parliament” (ie March 2015).

He slashed welfare as promised, but the economy slowed further. While employment revived, jobs have been recast as part-time, temporary and insecure. As a result, productivity stalled. These declines will cause permanent damage to the British economy. Convinced that a chancellor should “never let a crisis go to waste”, Osborne used the opportunity to shrink the state, as cuts to government spending tore into welfare provision and public services. Real spend per head of population fell, and the real spend per head was particularly felt by the vulnerable citizen, as the population grew older and more fragile. Under his watch, total managed expenditure was cut in real terms by £14bn (2016-17 prices).

These cuts were made worse by a 3-4% rise in population, and by the increasing needs of an ageing population. Public sector net investment was allowed to fall from £60bn in 2010 to £35bn in 2016. It caused intense suffering to small and large firms and suppliers, many of which went and are going bust, laying off staff. The insistence on balancing the current budget also hurt millions of individuals innocent of the causes of the crisis.

Read more …

Oxymoron self-immolation.

How America’s Clean Coal Dream Unravelled (G.)

High above the red dirt and evergreen trees of Kemper County, Mississippi, gleams a 15-story monolith of pipes surrounded by a town-sized array of steel towers and white buildings. The hi-tech industrial site juts out of the surrounding forest, its sharp silhouette out of place amid the gray crumbling roads, catfish stands and trailer homes of nearby De Kalb, population: 1,164. The $7.5bn Kemper power plant once drew officials from as far as Saudi Arabia, Japan and Norway to marvel at a 21st-century power project so technologically complex its builder compared it to the moonshot of the 1960s. It’s promise? Energy from “clean coal”. “I’m impressed,” said Jukka Uosukainen, UN director for the Climate Technology Centre and Network, after a 2014 tour: “maybe using coal in the future is possible”.

Kemper, its managers claimed, would harness dirt-cheap lignite coal – the world’s least efficient and most abundant form of coal – to power homes and businesses in America’s lowest-income state while causing the least climate-changing pollution of any fossil fuel. It was a promise they wouldn’t keep. Last summer the plant’s owner, Southern Company, America’s second-largest utility company, announced it was abandoning construction after years of blown-out budgets and missed construction deadlines. “It hit us hard,” said Craig Hitt, executive director of the Kemper County Economic Development Authority. Some 75 miners, roughly half living inside Kemper County, have already been affected in a region where unemployment is 7.1% compared to a national average of just 4.1%. “It was going to be the biggest project in the history of the county, possibly in the state of Mississippi,” Hitt said.

Instead, this year, Kemper County was home to one of the first large coalmining layoffs of the Trump era. It’s failure is also likely to have a profound impact on the future of “clean coal”. “This was the flagship project that was going to lead the way for a whole new generation of coal power plants,” said Richard Heinberg, senior fellow at the Post Carbon Institute. “If the initial project doesn’t work then who’s going to invest in any more like it?” [..] a review by the Guardian of more than 5,000 pages of confidential company documents, internal emails, white papers, and other materials provided anonymously by several former Southern Co insiders, plus on- and off-record interviews with other former Kemper engineers and managers, found evidence that top executives covered up construction problems and fundamental design flaws at the plant and knew, years before they admitted it publicly, that their plans had gone awry.

Read more …

“If you were to speak about an arms race, then an arms race began exactly at the time and moment the U.S. opted out of the Anti-Ballistic Missile Treaty..”

Putin’s Megyn Kelly Interview (ZH)

NBC’s Megyn Kelly has tried to establish herself as the US media’s preeminent “Putin whisperer” since confronting the Russian president last year over allegations he sanctioned interference by hacking groups in the 2016 US presidential election. In a formal interview with the Russian president, Kelly asked the Russian leader about the latest development in the ongoing controversy, Mueller’s indictment of 13 Russians and 3 Russian entities for election meddling. Ignoring that the indictment stated that the alleged activities of the trolls at the Internet Research Agency had no impact on the outcome of the election, Kelly insisted on pressing the Russian president about why Russia hadn’t acted to prosecute the men – including Yevgeniy Prigozhin, a wealthy Russian businessman.

Putin pointed out that no formal requests had been made by the US government, and no effort to share the incriminating information had been made. “I have to see first what they’ve done. Give us a document, give us an official request” Putin said in the NBC interview adding that “We can not respond to that if they do not violate Russian laws.” Kelly responded by listing some of the allegations, before Putin insisted that they shouldn’t be presented to him personally – but to Russia’s general prosecutor. “This has to go through official channels, not through the press, or yelling and hollering in the United States Congress,” Putin said. The broadcast aired a day after Putin grabbed headlines in Western media by revealing that Russia had recently finished testing a range of nuclear weapons that were capable of evading US anti-ballistic missile batteries, showing animated footage and digital representations of the missiles’ capabilities striking Florida which prompted an uproar at the US State Department.

Meanwhile, even though Russia has repeatedly criticized the US and NATO for installing anti-ballistic missile shields in Eastern Europe that Russia says more closely resemble offensive missile batteries, Putin pushed back against questions about whether the US and Russia were entering a new Cold War. The Russian leader said anybody spreading these accusations are more concerned with propaganda than accurate representations of the relationships between the two countries. “My point of view is that the individuals that have said that a new Cold War has started are not analysts. They do propaganda.” Repeating a claim that has been made by many Russian officials, Putin said the arms race between the US and Russia began when George W Bush withdrew from the anti-ballistic missile treaty in 2002. “If you were to speak about an arms race, then an arms race began exactly at the time and moment the U.S. opted out of the Anti-Ballistic Missile Treaty,” he said.

Read more …

Never a good idea for a party that losses big in elections to be in government; what are elections for? The SPD is so divided now it could turn its back on Merkel at literally any moment over the nexy 4-5 years.

Germany’s SPD Votes For Coalition Handing Merkel Fourth Term (G.)

Germany’s Social Democratic party has agreed to form another “grand coalition” government with the conservative CDU, ending months of political uncertainty in Europe and guaranteeing Chancellor Angela Merkel a fourth term in office. Sunday’s announcement by the party’s leadership ends almost six months of uncertainty in German politics, the longest the country has been without a government in its postwar history. A majority of 66.02% members of 463,723 eligible SPD members voted in favour of renewing the constellation that has governed Germany for the last four years, its treasurer, Dietmar Nietan, confirmed at the party’s headquarters in Berlin.

“We now have some clarity”, said the Social Democrats’ caretaker leader, Olaf Scholz, a contender for the role of finance minister, speaking at the Willy Brandt House. “The SPD will enter into government”. The leadership of the SPD had initially ruled out joining Merkel in government in the wake of historically disappointing results at federal elections in September last year. But the collapse of talks to form an unorthodox “Jamaica” coalition between Merkel’s conservatives, the pro-business Free Democrats and the Green party forced the German centre-left back to the negotiating table, where it managed to secure a surprising victory in getting the chancellor to cede control of the influential finance ministry.

Read more …

“..to borrow that €3 billion on behalf of its creditors, the Greek state added €816 million in interest payments to its debt repayments for 2025. Germany’s cost for rolling over the same sum, on the same day, was a mere €63 million…”

Europe’s Band-Aid Ensures Greece’s Debt Bondage (Varoufakis)

The big moment, it is said, will come in August, when Greece will be pronounced a “normal” European country again. Recently, in preparation for the government’s return to the money markets – from which it has been effectively excluded since 2010 – Greece’s public-debt authority has been testing the waters with a long-term bond issue. Unfortunately, all the happy talk about impending “debt relief” and a “clean exit” from Greece’s third “bailout” obscures an uglier truth: the country’s debt bondage is being extended to 2060. And, by ossifying Greece’s insolvency, while pretending to have overcome it, Europe’s establishment is demonstrating its dogged refusal to address the eurozone’s underlying fault lines. This augurs ill for ALL Europeans.

For an EU country to be considered “normal,” it should be subject to the scrutiny facing countries that were never bailed out. That means the standard twice-yearly checks of compliance with the EU’s Stability and Growth Pact, as performed by the European Commission under the so-called European Semester procedure. Nevertheless, for countries like Ireland or Portugal, a tougher “post-program surveillance” procedure was designed following their bailouts: quarterly checks conducted not only by the European Commission but also by the European Central Bank.

It is plain to see why Greece’s road will be much bumpier than Ireland’s or Portugal’s. The ECB had already begun purchasing Irish and Portuguese debt in the secondary markets well before these countries’ bailout exit, as part of its “quantitative easing” program. This enabled the Irish and Portuguese governments to issue large quantities of new debt at low interest rates. Greece was never included the ECB’s quantitative easing program, for two reasons: its debt burden was too large to service in the long term, even with the help of ECB-sponsored low interest rates, and the ECB was under pressure, mainly from Germany, to wind down the program. Moreover, the post-program surveillance procedure does not give the “troika” of official creditors the leverage over Greece that they desire.

In celebrating Greece’s “clean exit,” while retaining its iron grip on the Greek government and withholding debt restructuring, Europe’s establishment is once again displaying its skill at inventing neologisms. Until 75% of Greece’s public debt is repaid – in 2060, at the earliest – the country, we are told, will be subject to “enhanced surveillance” (a term with unfortunate echoes of “enhanced interrogation”). In practice, this means 42 years of quarterly reviews, during which the European Commission and the ECB “in collaboration with the IMF” may impose new “measures” on Greece (such as austerity, fire sales of public property, and restrictions on organized labor). In short, the next two generations of Greeks will grow up with the troika and its “process” (perhaps under a different name) as a permanent fixture of life.

The celebration of Greece’s return to normality began a few weeks ago with the government’s oversubscribed €3 billion issue of its first seven-year bond in years. What the revelers failed to note, however, was that, to borrow that €3 billion on behalf of its creditors, the Greek state added €816 million in interest payments to its debt repayments for 2025. Germany’s cost for rolling over the same sum, on the same day, was a mere €63 million. Will Greece’s income rise by a similar amount between now and 2025 to make this sustainable?

Read more …

“The agricultural feed companies, the chemical companies, the pharmaceutical companies that provide the antibiotics fed en masse to factory-farmed animals, the equipment manufacturers that sell cages and tractors – they all benefit.”

Modern Food Farming Puts UK Wildlife Species At Risk Of Extinction (Ind.)

Some of Britain’s favourite wildlife is at risk of becoming extinct unless there is a new, 21st-century agricultural revolution, experts are warning. Species from hedgehogs to skylarks and birds of prey are being wiped out – in part by companies with vested interests in “destructive” factory farming, it was claimed on World Wildlife Day, which takes place today. The “alarming” declines in wildlife will threaten not just the richness of the planet but also our ability to grow food, according to the RSPB. After scientists warned last year that the world is facing a sixth mass extinction, turtle doves are on the brink of being wiped out, the latest survey figures show. Numbers of grey partridges, corn buntings and tree sparrows have dropped by at least 90 per cent in 40 years, leaving them all at risk of vanishing from Britain.

Earlier this month, a new report revealed that the number of hedgehogs in the countryside had more than halved since 2000. Nearly two-thirds of Britain’s skylarks and lapwings have disappeared, the European bird census showed, while Birdlife International says 95 per cent of turtle doves have vanished in 20 years. Just days after Environment Secretary Michael Gove unveiled plans to reward farmers who care for the environment, ornithologist Philip Lymbery warned of a culture among government policymakers and scientists of blaming biodiversity declines on climate change – instead of tackling those with “vested interests” in “disastrous” modern farming practices – because it was easier to avoid blaming anyone.

Mr Lymbery, head of charity Compassion in World Farming (CiWF), said changes in farming in the past half-century to drastically and artificially push up quantities of food produced were destroying species from nightingales to butterflies and peregrines. “I’m worried that policymakers and some scientists duck the issue by blaming all the things damaging nature on climate change,” he told The Independent. [..] “The agricultural feed companies, the chemical companies, the pharmaceutical companies that provide the antibiotics fed en masse to factory-farmed animals, the equipment manufacturers that sell cages and tractors – they all benefit. “It’s not the average farmer who benefits from industrial agriculture. And it needs to change.”

Read more …

Hollywood mirrors international charities like Oxfam. Pedophilia rules both.

Three Billboards In Hollywood, California (TAM)

Just days before the first Academy Awards ceremony since Hollywood was hit with allegations of rampant sexual harassment, assault, and pedophilia, a Los Angeles street artist made a bold statement just a few miles from the Dolby Theater where the Oscars will be held. Sabo, a conservative-leaning artist who has previously tagged the city with art referencing former President Obama’s drones, purchased three billboards, echoing the sentiment of a Academy Award-nominated film, Three Billboards Outside Ebbing, Missouri, which tells the story of a mother who seeks accountability for her daughter’s rape and murder, which police in her small town have failed to solve. In the film, the mother purchases three billboards that read:

“RAPED WHILE DYING”

“AND STILL NO ARRESTS?”

“HOW COME CHIEF WILLOUGHBY?”

In Sabo’s version, the billboards plastered in Hollywood read:

“AND THE OSCAR FOR BIGGEST PEDOPHILE GOES TO…”

“WE ALL KNEW AND STILL NO ARRESTS”

“NAME NAMES ON STAGE OR SHUT THE HELL UP!”

Kevin Spacey’s career went down in flames last year amid the fallout of widespread allegations of abuse by now-scorned producer Harvey Weinstein. Anthony Rapp accused the actor of making advances on him in 1986, when Rapp was only 14. Other accusations against Spacey followed, including some others that alleged Spacey attempted to take advantage of the victims when they were under the age of 18. Further, Corey Feldman, who has long warned of predatory, pedophilic behavior in Hollywood, revealed several of his accused abusers last year, citing John Grissom, former talent manager Marty Weiss, and Alphy Hoffman, who was the son of a high-power producer and ran the trendy Soda Pop Club, where Feldman claims widespread harassment took place in the 1980s.

Feldman claimed there were six abusers total, saying one is an A-list actor who might kill him. He has previously said his fellow child star, Corey Haim, now deceased, received worse abuse than he did. In a 2011 appearance on Nightline, Feldman said: “[T]he No. 1 problem in Hollywood was and is and always will be pedophilia…that’s the biggest problem for children in this industry… It’s the big secret.”

Read more …

Nov 082017
 
 November 8, 2017  Posted by at 1:47 pm Finance Tagged with: , , , , , , , , , , ,  12 Responses »


Salvador Dalí The oecumenial council 1960

 

Trying to figure out what on earth is happening in the Middle East appears to have gotten a lot harder. Perhaps (because) it’s become more dangerous too. There are so many players, and connections between players, involved now that even making one of those schematic representations would never get it right. Too many unknown unknowns.

A short and incomplete list of the actors: Sunni, Shiite, Saudi Arabia, US, Russia, Turkey, ISIS, Syria, Iran, Iraq, Libya, Kurds, Lebanon, Hezbollah, Hamas, Qatar, Israel, United Arab Emirates (UAE), Houthis, perhaps even Chechnya, Afghanistan, Pakistan. I know I know, add your favorites. So what have we got, or what do we know we’ve got? We seem to have the US lining up with Israel, the UAE and Saudi Arabia against Russia, Iran, Syria, Hezbollah. Broadly. But that’s just a -pun intended- crude start.

Putin has been getting closer to the Saudis because of the OPEC production cuts, trying to jack up the price of oil. Which ironically has now been achieved on the heels of the arrests of 11 princes and scores of other wealthy and powerful in the kingdom. But Putin also recently signed a $30 billion oil -infrastructure- deal with Iran. And he’s been cuddling up to Israel as well.

In fact, Putin may well be the most powerful force in the Middle East today. Well played?! He prevented the demise of Assad in Syria, which however you look at it at least saved the country from becoming another Iraq and Libya style failed state. If there’s one thing you can say about the Middle East/North Africa it’s that the US succeeded in creating chaos there to such an extent that it has zero control left over any of it. Well played?!

 

One thing seems obvious: the House of Saud needs money. The cash flowing out to the princes is simply not available anymore. The oil price is a major factor in that. Miraculously, the weekend crackdown on dozens of princes et al, managed to do what all the OPEC meetings could not for the price of oil: push it up. But the shrinkage of foreign reserves shows a long term problem, not some momentary blip:

 

 

Another sign that money has become a real problem in Riyadh is the ever-postponed IPO of Saudi Aramco, the flagship oil company supposedly worth $2 trillion. Trump this week called on the Saudi’s to list it in New York, but despite the upsurge in oil prices you still have to wonder which part of that $2 trillion is real, and which is just fantasy.

But yeah, I know, there’s a million different stocks you can ask the same question about. Then again, seeing the wealth of some of the kingdom’s richest parties confiscated overnight can’t be a buy buy buy signal, can it? Looks like the IPO delay tells us something.

And then you have the 15,000 princes and princesses who all live off of the Kingdom’s supposed riches (‘only 2,000’ profit directly). All of them live in -relative- wealth. Some more than others, but there’s no hunger in the royal family. Thing is, overall population growth outdoes even that in the royal family. Which means, since the country produces nothing except for oil, that there are 1000s upon 1000s of young people with nothing to do but spend money that’s no longer there. Cue mayhem.

 

 

And things are not getting better, Saudi Arabia loses money on every barrel it produces. There are stories about them lowering their break-even price, but let’s take that with a few spoonfuls of salt. A 25% drop in break-even prices in just one year sounds a bit too good. Moreover, main competitors like Iran would still have a much lower break-even price. So even if prices would rise further, the Saudi’s might only break even while Iran gets much richer. Running vs standing still.

 

Saudi Arabia Leads Gulf Nations in Cutting Break-Even Oil Price

Saudi Arabia, OPEC’s biggest oil producer, is also a leader when it comes to slashing the crude price the country needs to balance its budget. The kingdom will need oil to trade at $70 a barrel next year to break even, the IMF said Tuesday in its Regional Economic Outlook for the Middle East and Central Asia. That’s down from a break-even of $96.60 a barrel in 2016, the biggest drop of eight crude producers in the Persian Gulf. The break-even is a measure of the crude price needed to meet spending plans and balance the budget.

 

 

Gulf oil producers are cutting spending and eliminating subsidies after crude plunged from more than $100 a barrel in 2014 to average just over half that this year. The need to curb spending is more urgent with the Organization of Petroleum Exporting Countries cutting output to reduce a global glut. Oil will trade at $50 to $60 a barrel for the “medium term,” the IMF said.

 

 

So a thorough cleansing job of the royal family is perhaps inevitable, albeit very risky. King Salman and crown prince Mohammed bin Salman are up against a very large group of rich people. But there’s no way back now.

 

Saudi Banks Freeze More Than 1,200 Bank Accounts in Anti-Corruption Purge

Saudi Arabian banks have frozen more than 1,200 accounts belonging to individuals and companies in the kingdom as part of the government’s anti-corruption purge, bankers and lawyers said on Tuesday. They added that the number is continuing to rise. Dozens of royal family members, officials and business executives have been detained in the crackdown and are facing allegations of money laundering, bribery, extorting officials and taking advantage of public office for personal gain. Since Sunday, the central bank has been expanding the list of accounts it is requiring lenders to freeze on an almost hourly basis…

Much more will have to follow that. Doing a half way job is far too risky once the job has started. Not even $800 billion sounds like all that much. Separate families and factions within the royal family have had decades to accumulate wealth.

 

Saudi Crackdown Targets Up to $800 Billion in Assets

The Saudi government is aiming to confiscate cash and other assets worth as much as $800 billion in its broadening crackdown on alleged corruption among the kingdom’s elite, according to people familiar with the matter. Several prominent businessmen are among those who have been arrested in the days since Saudi authorities launched the crackdown on Saturday, by detaining more than 60 princes, officials and other prominent Saudis, according to those people and others. The country’s central bank, the Saudi Arabian Monetary Authority, said late Tuesday that it has frozen the bank accounts of “persons of interest” and said the move is “in response to the Attorney General’s request pending the legal cases against them.”

The most visible – and perhaps richest- of all those arrested -in western eyes- is Al-Waleed. The Bloomberg estimate of his wealth that came out this week is $19 billion. But their own article seems to indicate a much higher number. He owns 5% of Apple -says Bloomberg-, and that share alone would be worth $45 billion.

 

Alwaleed, Caught in Saudi Purge, Has Assets Across the World

Apple – Alwaleed bought 6.23 million shares, or 5 percent, of the computer and mobile-device maker for $115.4 million in 1997. He made these purchases between mid-March and April of that year while the company was still struggling to turn itself around. He has since continued to hold the stake while Apple’s valuation has soared to as high as $900 billion.

 

Going through all these numbers, you can imagine why the ruling family, or rather the rulers within that family, are getting nervous. And that’s where we get to an interesting piece by Ryan Grim at the Intercept, who says it’s not even 32-year-old crown prince Mohammed bin Salman, known as MBS, or King Salman, 81, who control the kingdom these days, it’s the United Arab Emirates (UAE) -and maybe Washington-.

The coup has already been perpetrated.

 

Saudi Arabia’s Government Purge – And How Washington Corruption Enabled It

The move marks a moment of reckoning for Washington’s foreign policy establishment, which struck a bargain of sorts with Mohammed bin Salman, known as MBS, and Yousef Al Otaiba, the United Arab Emirates ambassador to the U.S. who has been MBS’s leading advocate in Washington. The unspoken arrangement was clear: The UAE and Saudi Arabia would pump millions into Washington’s political ecosystem while mouthing a belief in “reform,” and Washington would pretend to believe that they meant it.

MBS has won praise for some policies, like an openness to reconsidering Saudi Arabia’s ban on women drivers. Meanwhile, however, the 32-year-old MBS has been pursuing a dangerously impulsive and aggressive regional policy, which has included a heightening of tensions with Iran, a catastrophic war on Yemen, and a blockade of ostensible ally Qatar. Those regional policies have been disasters for the millions who have suffered the consequences, including the starving people of Yemen, as well as for Saudi Arabia, but MBS has dug in harder and harder. And his supporters in Washington have not blinked.

The platitudes about reform were also challenged by recent mass arrests of religious figures and repression of anything that has remotely approached less than full support of MBS. The latest purge comes just days after White House adviser Jared Kushner, a close ally of Otaiba, visited Riyadh, and just hours after a bizarre-even-for-Trump tweet. Whatever legitimate debate there was about MBS ended Saturday — his drive to consolidate power is now too obvious to ignore. And that puts denizens of Washington’s think tank world in a difficult spot, as they have come to rely heavily on the Saudi and UAE end of the bargain.

As The Intercept reported earlier, one think tank alone, the Middle East Institute, got a massive $20 million commitment from the UAE. And make no mistake, MBS is a project of the UAE — an odd turn of events given the relative sizes of the two countries. “Our relationship with them is based on strategic depth, shared interests, and most importantly the hope that we could influence them. Not the other way around,” Otaiba has said privately.

The kingdom’s broke. Not today, or tomorrow morning, but crown prince MBS is able to look at the numbers and go: Oh Shit! And if he doesn’t see it, he has Kushner (re: Israel) and Al-Otaiba to fill him in. All three relative youngsters -MBS is 32, Kushner is 36, Otaiba is 43- are exceedingly nervous by now.

And then you get war, or the threat of war. War in Yemen, a blockade of Qatar, and now ‘mingling’ in Lebanon with the somewhat mysterious removal of billionaire PM Hariri -allegedly on an Iran/Hezbollah assassination plot-, and outright threats against Iran and Hezbollah:

 

Lebanon’s Hariri Visits UAE As Home Crisis Escalates

Lebanon’s outgoing prime minister, Saad al-Hariri, made a brief visit to the United Arab Emirates from Saudi Arabia on Tuesday despite a deepening crisis back home and a rise in regional tensions triggered by his surprise resignation. Hariri announced his resignation on Saturday during a visit to his ally Saudi Arabia and has not yet returned to Lebanon. He said he believed there was an assassination plot against him and accused Iran, Saudi Arabia’s arch-rival, and its Lebanese ally Hezbollah of sowing strife in the Arab world.

His resignation has thrust Lebanon back into the frontline of the regional rivalry that pits a mostly Sunni bloc led by Saudi Arabia and allied Gulf monarchies against Shi‘ite Iran and its allies. Hariri’s office said he had flown to Abu Dhabi on Tuesday and then returned to Riyadh, but it gave no reason for the trip. It also did not say when he would return home. Hariri’s Future TV channel said he would also visit Bahrain but gave no reason.

In short: billionaire PM Hariri is a puppet. Just perhaps not of Saudi Arabia, but of Abu Dhabi. Whether he’s under house arrest in Riyadh, as has been suggested, is still unclear. But it’s a safe bet that he didn’t fly to Abu Dhabi -and back- alone, or of his own accord. He went to receive instructions.

 

Saudi Arabia Accuses Iran Of ‘Direct Military Aggression’ Over Yemen Missile

Saudi Arabia’s crown prince has accused Iran of “direct military aggression” by supplying missiles to Houthi rebels in Yemen, raising the stakes in an already tense standoff between the two regional rivals. Mohammed bin Salman linked Tehran to the launch of a ballistic missile fired from Yemen towards the international airport in the Saudi capital of Riyadh on Saturday. The missile was intercepted and destroyed.

“The involvement of the Iranian regime in supplying its Houthi militias with missiles is considered a direct military aggression by the Iranian regime,” the prince said on Tuesday during a phone conversation with the UK foreign secretary, Boris Johnson, according to the state-run Saudi Press Agency. He added that the move “may be considered an act of war against the kingdom”. Iran has called Riyadh’s accusations as baseless and provocative.

We have way of knowing what is true or not about this. We do know that Saudi Arabia have been executing a barbaric war in Yemen. With weapons from the US, UK, et al. So someone firing back wouldn’t be that far-fetched.

 

Regardless, Pepe Escobar, a journalist who knows much more than his peers, or at least doesn’t hold back as much as them, doesn’t see this end well for MBS, UAE, Israel, US, and whoever else is in their corner. Another losing war for the US in the Middle East? We’re losing count.

 

The Inside Story Of The Saudi Night Of Long Knives

A top Middle East business/investment source who has been doing deals for decades with the opaque House of Saud offers much-needed perspective: “This is more serious than it appears. The arrest of the two sons of previous King Abdullah, Princes Miteb and Turki, was a fatal mistake. This now endangers the King himself. It was only the regard for the King that protected MBS. There are many left in the army against MBS and they are enraged at the arrest of their commanders.” To say the Saudi Arabian Army is in uproar is an understatement. “He’d have to arrest the whole army before he could feel secure.”

[..] The story starts with secret deliberations in 2014 about a possible “removal” of then King Abdullah. But “the dissolution of the royal family would lead to the breaking apart of tribal loyalties and the country splitting into three parts. It would be more difficult to secure the oil, and the broken institutions whatever they were should be maintained to avoid chaos.” Instead, a decision was reached to get rid of Prince Bandar bin Sultan – then actively coddling Salafi-jihadis in Syria – and replace the control of the security apparatus with Mohammed bin Nayef. The succession of Abdullah proceeded smoothly.

Power was shared between three main clans: King Salman (and his beloved son Prince Mohammed); the son of Prince Nayef (the other Prince Mohammed), and finally the son of the dead king (Prince Miteb, commander of the National Guard). In practice, Salman let MBS run the show. And, in practice, blunders also followed. The House of Saud lost its lethal regime-change drive in Syria and is bogged down in an unwinnable war on Yemen, which on top of it prevents MBS from exploiting the Empty Quarter – the desert straddling both nations. The Saudi Treasury was forced to borrow on the international markets. Austerity ruled …

[..] aversion to MBS never ceased to grow; “There are three major royal family groups aligning against the present rulers: the family of former King Abdullah, the family of former King Fahd, and the family of former Crown Prince Nayef.” Nayef – who replaced Bandar – is close to Washington and extremely popular in Langley due to his counter-terrorism activities. His arrest earlier this year angered the CIA and quite a few factions of the House of Saud – as it was interpreted as MBS forcing his hand in the power struggle. According to the source, “he might have gotten away with the arrest of CIA favorite Mohammed bin Nayef if he smoothed it over but MBS has now crossed the Rubicon though he is no Caesar. The CIA regards him as totally worthless.”

[..] The source, though, is adamant; “There will be regime change in the near future, and the only reason that it has not happened already is because the old King is liked among his family. It is possible that there may be a struggle emanating from the military as during the days of King Farouk, and we may have a ruler arise that is not friendly to the United States.”

In the end, it all comes down to a familiar theme: follow the money. And we need to seriously question the economic reality of Saudi Arabia. That graph above of their foreign reserves looks downright grim.

With money comes power. Who loses money loses power. Saudi Arabia is bleeding money. The population surge is uncanny, and there are no jobs for all these young people. Perhaps the best they can do is be a US/Israel puppet in an attempt to ‘redo’ the map of the Middle East, but that has not been a very successful project off late -like the past 100 years-.

Then again, when you’re desperate you do desperate things. And when you’re a 32-year-old crown prince with more enemies than you can keep track of, you use what money is left to 1) keep up appearances, 2) steal what others have gathered, 3) buy weapons up the wazoo, and 4) go to war.

It all paints a very dark picture for the world. Russia won’t stand for attacks on Iran. And Iran won’t let attacks on Lebanon/Hezbollah go unanswered. All that is set to push up oil prices further, and all parties involved are just fine with that. Because they can buy more weapons with the additional profits.

I’ll leave you with Nassim Taleb’s comments on the situation. After all, Nassim’s from Lebanon, and knows that part of the world like the back of his hand:

 

 

 

Aug 272017
 
 August 27, 2017  Posted by at 9:00 am Finance Tagged with: , , , , , , , , , ,  5 Responses »


Elliott Erwitt Downtown Hat Shop Window, Pittsburgh 1950

 

Phillips Curve Doesn’t Help Forecast Inflation, Fed Study Finds (BBG)
Where Do Consumers Spend The Most Money? (Mish)
Should California Spend $3 Billion To Help People Buy Electric Cars? (LAT)
Tesla: A Canary in the Wall Street Coal Mine (Barron’s)
UK Labour Party Makes Dramatic Shift On Brexit And Single Market (G.)
Controlled Demolition (Jim Kunstler)
The War That Time Forgot (CP)
It’s Time To Accept Carbon Capture Has Failed (Conv.)
Industrial Farming Is Driving The Sixth Mass Extinction Of Life On Earth (Ind.)

 

 

The incompetence is deafening. Trillions have been washed away on the theory.

Phillips Curve Doesn’t Help Forecast Inflation, Fed Study Finds (BBG)

A fundamental relationship of mainstream economic theory at the heart of the Federal Reserve’s strategy for setting interest rates has been a poor guide for policy makers for at least three decades, according to a study by the Philadelphia Fed’s top-ranking economist. The paper, co-authored by Philadelphia Fed Director of Research Michael Dotsey, shows that forecasting models based on the so-called Phillips curve, which asserts a link between unemployment and inflation, don’t actually help predict inflation. “Our results indicate that monetary policymakers should at best be very cautious in their reliance on the Phillips curve when gauging inflationary pressures,” Dotsey and Philadelphia Fed economists Shigeru Fujita and Tom Stark wrote.

Their study is timely. Fed officials have been surprised by a deceleration in U.S. inflation over the past several months despite a continued decline in unemployment, the opposite of what the Phillips curve relationship would predict. Minutes of the last meeting of the central bank’s rate-setting Federal Open Market Committee in July revealed that “a few participants cited evidence suggesting that this framework was not particularly useful in forecasting inflation,” while “most participants thought that the framework remained valid.” If the majority view on the FOMC is that the Phillips curve framework is still valid, it implies that central bankers should continue raising interest rates with unemployment at a 16-year low, because they expect inflation will rise in the medium term even though prices pressures have been disappointingly soft.

Kansas City Fed President Esther George, who has been more forceful than many of her colleagues in recent years about the need to raise rates, lent support to that view on the sidelines of this week’s annual gathering of central bankers from around the world in Jackson Hole, Wyoming. “There may in fact be something wrong with the models, I don’t know, I think that continues to be a question that many economists are asking,” George said during a TV interview with Bloomberg’s Michael McKee that aired Thursday. Even so, she favors another rate increase this year.

Read more …

Cars + gasoline account for almost 30% of all spending. Crazy.

Where Do Consumers Spend The Most Money? (Mish)

In Dealers “Wildly Overweight” SUVs as Sales Slow, I commented “Vehicles account for 20% of retail spending. A crash or even a significant slowdown will impact retail sales and thus GDP.” A reader asked me how I calculated that. Let’s take a look. My number came from the latest Census Department Advance Retail Sales Report. Here are some charts I created from 7-month totals (January-July) 2017.

Key Points
• Motor vehicles and parts account for 21.18% of retail sales. Gasoline stations account for 7.94%. Together that adds up to 29.12%.
• Food and beverage stores (grocery and liquor stores) account for 12.62 percent of retail sales. Food services and drinking places (restaurants and bars) account for 12.14. The food and drink total is 24.76%.
• Nonstore retailers (think Amazon) account 10.39% of retail sales.

Read more …

Yeah, let’s subsidize the car culture.

Should California Spend $3 Billion To Help People Buy Electric Cars? (LAT)

Over seven years, the state of California has spent $449 million on consumer rebates to boost sales of zero-emission vehicles. So far, the subsidies haven’t moved the needle much. In 2016, of the just over 2 million cars sold in the state, only 75,000 were pure-electric and plug-in hybrid cars. To date, out of 26 million cars and light trucks registered in California, just 315,000 are electric or plug-in hybrids. The California Legislature is pushing forward a bill that would double down on the rebate program. Sextuple down, in fact. If $449 million can’t do it, the thinking goes, maybe $3 billion will. That’s the essence of the plan that could lift state rebates from $2,500 to $10,000 or more for a compact electric car, making, for example, a Chevrolet Bolt EV electric car cost the same as a gasoline-driven Honda Civic.

Already approved by several Senate and Assembly committees, the bill will go to Gov. Jerry Brown for his approval or veto if the full Legislature approves it by the end of its current session on Sept. 15. California aims to reduce greenhouse gas emissions by 2030 to a level 40% below what they were in 1990. “If we want to hit our goals, we’re going to have to do something about transportation,” said Assemblyman Phil Ting (D-San Francisco), sponsor of Assembly Bill 1184. Without a dramatic boost in subsidies, Ting said, the state risks falling short of Gov. Brown’s goal of 1.5 million zero-emission vehicles on California highways by 2025, and the California Air Resources Board’s goal of 4 million such cars by 2030. The bill is opposed by Republicans averse to taxpayer subsidies and even the Legislature’s own analysts have called it “duplicative,” “unclear” and “problematic.”

Read more …

“Once again, history and reality are replaced by dreams with little substance.”

Tesla: A Canary in the Wall Street Coal Mine (Barron’s)

Those who think today’s stock market is unlike that of 2000, when baseless enthusiasm pushed stocks up to wild valuations, only to collapse in subsequent years, should take another look. Do they remember counting eyeballs as a basis for value? Once again, history and reality are replaced by dreams with little substance. Tesla, in which I have a short position, is becoming the loudest canary in Wall Street’s coal mine. Tesla requires repetitive capital raises to fund persistent operating losses. This requires bullish analysts and holders to keep the stock aloft with projections of imagined earnings from future products, while they overlook existing businesses, which continue to lose vast sums of money. Morgan Stanley, one of Tesla’s major underwriters, has an analyst covering Tesla named Adam Jonas. Astonishingly, he raised his price target for the stock, despite recognizing the need to slash his earnings forecast.

In May, Jonas had estimated per-share losses (excluding stock-option expense) of $3.53 in 2017 and $1.14 in 2018, and a profit of $2.43 in 2019. His latest estimates: losses of $7.60 and $3.66, and a 2019 profit of $2.01. Raising the target price while more than doubling the company’s projected loss indicates the craziness of the times. Price targets are fantasies, discounting distant earnings estimates by analysts who show little accuracy in estimating only a year ahead. For most companies, profit is the major objective. Tesla is different because its founder is different. Elon Musk is driven by a mission to replace fossil fuels with renewable energy. Unlike companies seeking profit maximization by using patents to establish exclusive rights to products, Musk encourages competitors and has made virtually all of his patents available. Almost all auto companies have imminent plans to compete.

Tesla has been first-to-market in electric cars, but this in no way guarantees success, as competition and technological change are major challenges. Remember Atari, Blackberry, AOL, Napster, Netscape, and Palm? Musk is smart and imaginative, but none of his major companies are profitable. Tesla has been around for 14 years and has cumulatively lost more than $3.7 billion, despite the massive subsidies that it and its customers have received. SolarCity, also a beneficiary of alternative-energy subsidies, lost hundreds of millions of dollars before being bailed out by Tesla. As subsidies diminish, and competition emerges, profits will be even more elusive. Tesla tries to convey the illusion of inexhaustible demand for its cars, yet sales of the Model S and Model X have been flat for four quarters. Tesla’s rising inventory and shrinking deposits suggest declining demand.

Tesla claims to have more than 400,000 deposits for the Model 3, but these aren’t orders. They reflect a decision by potential buyers to get in line for a $7,500 tax credit at virtually no cost. Shifting $1,000 from a savings account into a refundable Tesla deposit costs only about $1 per year in lost interest. Fewer than 100,000 of these depositors will actually get full tax credits before Tesla consumes its allowable allotment of them. Its competitors will be able to offer such credits to prospective buyers, just as Tesla’s expire.

Read more …

Jockeying for votes?

UK Labour Party Makes Dramatic Shift On Brexit And Single Market (G.)

Labour is to announce a dramatic policy shift by backing continued membership of the EU single market beyond March 2019, when Britain leaves the EU, establishing a clear dividing line with the Tories on Brexit for the first time. In a move that positions it decisively as the party of “soft Brexit”, Labour will support full participation in the single market and customs union during a lengthy “transitional period” that it believes could last between two and four years after the day of departure, it is to announce on Sunday. This will mean that under a Labour government the UK would continue to abide by the EU’s free movement rules, accept the jurisdiction of the European court of justice on trade and economic issues, and pay into the EU budget for a period of years after Brexit, in the hope of lessening the shock of leaving to the UK economy.

In a further move that will delight many pro-EU Labour backers, Jeremy Corbyn’s party will also leave open the option of the UK remaining a member of the customs union and single market for good, beyond the end of the transitional period. Permanent long-term membership would only be considered if a Labour government could by then have persuaded the rest of the EU to agree to a special deal on immigration and changes to freedom of movement rules. The announcement, revealed in the Observer by the shadow Brexit secretary, Keir Starmer, means voters will have a clear choice between the two main parties on the UK’s future relations with the EU after a year in which Labour’s approach has been criticised for lacking definition and appeared at times hard to distinguish from that of the Tories.

The decision to stay inside the single market and abide by all EU rules during the transitional period, and possibly beyond, was agreed after a week of intense discussion at the top of the party. It was signed off by the leadership and key members of the shadow cabinet on Thursday, according to Starmer’s office.

Read more …

“..to reassure the masses that effective spells for favor of the Gods have been cast — except that in our civilization money is God.”

Controlled Demolition (Jim Kunstler)

This is the week-of-weeks when the official grand viziers of finance gather at Jackson Hole, Wyoming, to confab and interpret the lay of animal neck-bones and other auguries scattered in the sand, with the hope of steering the awesome powers of the universe this was or that as they affect the operations of money. The exercise is hardly different in function from the sort of rude ceremonials that took place on top of Sumerian ziggurats and Aztec temples — to reassure the masses that effective spells for favor of the Gods have been cast — except that in our civilization money is God. Or “money,” we should say, because the old definitions don’t fit so well anymore. It used to have a straightforward relationship with the work required to produce actual things of value, but those days are gone.

“Money” nowadays is a byproduct of wishful analytics and computer legerdemain seasoned with generous measures of fraud and larceny. This is a big problem when everything is measured in money and it becomes quite impossible to state with assurance what the value of money actually is. Obviously, you end up not knowing the value of anything. That’s the perilous situation the world faces. And since the USA is the straw the stirs the world’s drink — at least for now — the utterances emanating from Jackson Hole may determine which way that situation turns. We should suppose that the officers of the Federal Reserve are upright, well-intentioned, patriotic people. No doubt they think they are. But the perilous situation is largely one of their own making, and seems to be veering out of their control, and reputations are at stake.

Their task at this year’s Jackson Hole confab is to maintain the appearance of confidence in their own rituals. But with a kicker. That kicker is named T-r-u-m-p. This modern Balaam, riding the ass of the Deep State into wickedness, must be stopped, perhaps at all costs. On his way to the oval office last fall, Trump prophesied that the stock markets represented “one big, fat, ugly bubble.” That was an offense to the grand viziers, for whom the elevated stock market valuations stood as the main testament to their power and wisdom. In fact, it was the only testament, and a rather flimsy one. More recently, though, the wicked Trump changed his tune and declared that the tower of stock market exaltation was his own doing, setting himself up for the revenge of the grand viziers.

Since nothing else has worked so far to dislodge Trump from the White House, a tumbling tower of stocks might seal his fate. The tower has to fall anyway, lest the moiling masses of flyover America think about besetting Wall Street with pitchforks and torches. A controlled demolition might be just the thing to appease these suffering holders of three part-time jobs (if they are so lucky) who have stood by in wonder and nausea while a tiny fraction of the elite gather unto themselves all the dwindling riches of the realm — at least in paper securities denominated in US dollars — while the wicked Trump will be left to the jackals of the Deep State, to be torn apart with the 25th Amenedment.

Read more …

Elizabeth War(ren).

The War That Time Forgot (CP)

If it’s Independence Day, then you can count on John McCain to be bunkered down in a remote outpost of the Empire growling for the Pentagon to unleash airstrikes on some unruly nation, tribe or gang. This July the Fourth found McCain making a return engagement to Kabul, an arrival that must have prompted many Afghans to scramble for the nearest air raid shelter. From the press room at NATO command, McCain announced that “none of us could say we are on a course to success here in Afghanistan.” The senator should have paused for a reflective moment and then called for an end to the war. Instead, McCain demanded that Trump send more US troops, more bombers and more drones to terrorize a population that has been riven by near constant war since the late 1970s.

McCain’s martial drool is now as familiar as the opening notes to the “Law & Order” theme song. What may surprise some, however, is the composition of the delegation that signed up to travel on his frequent flier program, notably the presence of two Democratic Senators with soaring profiles: Sheldon Whitehouse and Elizabeth Warren. Whitehouse, the former prosecutor (aren’t they all?) from Rhode Island, has lately taken a star turn in the role of chief inquisitor of suspected Russian witches in the Senate intelligence committee hearings. Perhaps he finally located one selling AK-47s to the Taliban to replace the guns they’d gotten from the CIA. (We now know that it’s the Saudis–not the Russians–who have been covertly funneling money to the Taliban, though don’t expect the Trump to impose any sanctions on the Kingdom of the Head-choppers.)

For her part, Warren largely echoed McCain’s bellicose banter that Trump needs to double down militarily to finish off the Taliban, the impossible dream. No real surprise here. To the extent that she’s advanced any foreign policy positions during her stint in the senate, Warren has been a dutiful supplicant to the demands of AIPAC and the Council on Foreign Relations, rarely diverging from the neocon playbook for the global war on Islam. Warren’s Afghan junket is a sure sign of her swelling presidential ambitions. These days “national security” experience is measured almost exclusively by how much blood you are willing to spill in countries you know almost nothing about. It didn’t take long for Warren to matriculate to the company position.

[..] Nothing better illustrates the eclipse of US global power than the fact that Afghanistan refuses to be subjugated or even managed, despite 16 years of hard-core carnage. Since the first US airstrikes hit Kandahar in October 2001, more than 150,000 Afghan civilians have been killed. Still Afghanistan resists imperial dictates. Even after Obama’s shameful troop surge in 2010, an escalation that went almost unopposed by the US antiwar movement, the Taliban now retains almost as much control of the country as it did in 2001. And for that Afghanistan must be punished. Eternally, it seems.

Read more …

There’s always a new theory. Don’t let’s stop using as much of the stuff as we can.

It’s Time To Accept Carbon Capture Has Failed (Conv.)

For years, optimists have talked up carbon capture and storage (CCS) as an essential part of taking emissions out of electricity generation. Yes, build wind and solar farms, they have said, but they can t be relied on to produce enough power all the time. So we ll still need our fleet of fossil-fuel-burning power stations; we just need to stop them pumping carbon dioxide (CO2) into the atmosphere. Most of their emphasis has been on post-combustion capture. This involves removing CO2 from power station flue gases by absorbing them into an aqueous solution containing chemicals known as amines. You then extract the CO2 , compress it into a liquid and pump it into a storage facility the vision in the UK being to use depleted offshore oil and gas fields. One of the big attractions with such a system is it could be retrofitted to existing power stations.

But ten years after the UK government first announced a £1 billion competition to design CCS, we re not much further forward. The reason is summed up by the geologist Lord Oxburgh in his contribution to the government-commissioned report on CCS published last year: “There is no serious commercial incentive and it will stay that way unless the state demonstrates there is a business there.” The problem is that the process is costly and energy intensive. For a gas-fired power station, you typically have to burn 16% more gas to provide the capture power. Not only this, you end up with a 16% increase in emissions of other serious air pollutants like sulphur dioxide, nitrogen oxides and particulate matter. Concerns have also been expressed about the potential health effects of the amine solvent used in the carbon capture.

You then have to contend with the extra emissions from processing and transporting 16% more gas. And all this before you factor in the pipeline costs of the CO2 storage and the uncertainties around whether it might escape once you ve got it in the ground. Around the world, the only places CCS looks viable are where there are heavy state subsidies or substantial additional revenue streams, such as from enhanced oil recovery from oilfields where the COC is being pumped in. Well, say the carbon capture advocates, maybe another technology is the answer. They point to oxy-combustion, a system which is close to reaching fruition at a plant in Texas.

First proposed many years ago by British engineer Rodney Allam, this involves separating oxygen from air, burning the oxygen with the fossil fuel, and using the combustion products -water and CO2- to drive a high-pressure turbine and produce electricity. The hot CO2 is pressurised and recycled back into the burners, which improves thermal efficiency. It has the additional advantage that CO12 is also available at pressures suitable for pipeline transportation.

Read more …

Small is beautiful.

Industrial Farming Is Driving The Sixth Mass Extinction Of Life On Earth (Ind.)

Industrial agriculture is bringing about the mass extinction of life on Earth, according to a leading academic. Professor Raj Patel said mass deforestation to clear the ground for single crops like palm oil and soy, the creation of vast dead zones in the sea by fertiliser and other chemicals, and the pillaging of fishing grounds to make feed for livestock show giant corporations can not be trusted to produce food for the world. The author of bestselling book The Value of Nothing: How to Reshape Market Society and Redefine Democracy will be one of the keynote speakers at the Extinction and Livestock Conference in London in October. Organised by campaign groups Compassion in World Farming and WWF, it is being held amid rising concern that the rapid rate of species loss could ultimately result in the sixth mass extinction of life.

This is just one reason why geologists are considering declaring a new epoch of the Earth, called the Anthropocene, as the fossils of soon-to-be extinct animals will form a line in the rocks of the future. The last mass extinction, which finished off the dinosaurs and more than three-quarters of all life about 65 million years ago, was caused by an asteroid strike that sent clouds of smoke all around the world, blocking out the sun for about 18 months. Prof Patel, of the University of Texas at Austin, said: “The footprint of global agriculture is vast. Industrial agriculture is absolutely responsible for driving deforestation, absolutely responsible for pushing industrial monoculture, and that means it is responsible for species loss. “We’re losing species we have never heard of, those we’ve yet to put a name to and industrial agriculture is very much at the spear-tip of that.”

Speaking to The Independent, he pointed to a “dead zone” – an area of water where there is too little oxygen for most marine life – in the Gulf of Mexico that has grown to the same size as Wales because of vast amounts of fertiliser that has washed from farms in mainland US, into the Mississippi River and then into the ocean. “That dead zone isn’t an accident. It’s a requirement of industrial agriculture to get rid of the sh*t and the run-off elsewhere because you cannot make industrial agriculture workable unless you kick the costs somewhere else,” he said. “The story of industrial agriculture is all about externalising costs and exploiting nature.” “Extinction is about the elimination of diversity. What happens in Brazil and other places is you get green deserts — monocultures of soy and nothing else. “Various kinds of chemistry is deployed to make sure it is only soy that’s grown on these mega-farms. “That’s what extinction looks like. If you ever go to a soy plantation, animal life is incredibly rare. It’s only soy, there’s nothing there for anything to feed on.”

Read more …

Aug 162017
 
 August 16, 2017  Posted by at 8:57 am Finance Tagged with: , , , , , , , , , ,  2 Responses »


Fred Stein Hydrant, New York 1947

 

The Greatest Crisis In World History Is About To Be Unleashed (von Greyerz)
After 100 Months of Buying The Dips – Peak Crazy (Stockman)
China Has Got To Fix Its Debt Problem, IMF Says (CNBC)
China Money Supply Growth Slips Again as Leverage Crunch Goes On (BBG)
UK Risks ‘Losing Its Place As Property-Owning Democracy’
The New American Dream: Rent Your Home From A Hedge Fund (Black)
Trump Signs Order to Speed Up Public-Works Permits (BBG)
German Challenge To ECB QE Asset Buys Sent To European Court (R.)
Washington’s Long War on Syria (Ren.)
Fish Confusing Plastic Debris In Ocean For Food (G.)

 

 

Debt leads to war.

The Greatest Crisis In World History Is About To Be Unleashed (von Greyerz)

Totally irresponsible policies by governments and central banks have created the most dangerous crisis that the world has ever experienced. Risk doesn’t arise quickly as the result of a single action or event. No, risk of the magnitude that the world is experiencing today is the result of many years or decades of economic mismanagement. Cycles are normal in nature and in the world economy. And cycles that are the result of the laws of nature normally play out in an orderly fashion without extreme tops or bottoms. “Just take the seasons. They go from summer to autumn, winter and spring, with soft transitions that seldom involve drama or catastrophe. Economic cycles would be the same if they were allowed to happen naturally without the interference of governments.

But power corrupts and throughout history leaders have always hung on to power by interfering with the normal business cycle. This involves anything from reducing the precious metals content of money from 100% to nothing, printing money, leveraging credit, manipulating interest rates, taking total taxes from at least 50% + today from nothing 100 years ago etc, etc. Governments will always fail when they believe that they are gods. But not only governments believe they perform godly tasks but also hubristic investment bankers like the ex-CEO of Goldman Sachs who proclaimed that the bank was doing God’s work. It must be remembered that Goldman, like most other banks, would have gone under if they and JP Morgan hadn’t instructed the Fed to save them by printing and guaranteeing $25 trillion. Or maybe that was God’s hand too?

We now have unmanageable risks at many levels – politically, geopolitically, economically and financially. This is a RISK ON situation that is extremely dangerous and will have very grave consequences. There are numerous risks that can all cause the collapse of the world economy and they all have equal relevance. However, the political situation in the USA is very dangerous for the world. This the biggest economy in the world, albeit bankrupt with debt growing exponentially and real deficits every year since 1960. Before the dollar has collapsed, the US will still be seen as a powerful nation, although a massive economic decline will soon weaken the country burdened by debt at all levels, government, state, and private.

Read more …

“There is absolutely no reason for the stock markets to be at current levels, let alone melting-up day after day.”

After 100 Months of Buying The Dips – Peak Crazy (Stockman)

Just call it Peak Crazy and move on. There is absolutely no reason for the stock markets to be at current levels, let alone melting-up day after day. The fact that this is happening is a measure of how impaired capital markets have become as a result of massive central bank intrusion. The robo-machines and day traders keep buying the dips because that has “worked” for the last 100 months. There is nothing more to it than residual momentum. Under a regime of honest money and price discovery, the stock market discounts the future. There is no plausible future from here that’s worth 24 times S&P 500 value or 96 times the Russell 2000. Surely the year-ahead earnings boom that Wall Street’s artists have penciled in is not in the slightest bit plausible. With 84% of the S&P 500 reporting Q2 results, LTM earnings are still 1.3% below where they were in September 2014.

Nothing has happened to corporate earnings in the last three years except deflation in the energy, materials and industrial sectors. After hitting $106 per share in September 2014, the global deflation cycle brought them to a low point of $86.44 per share in March 2016 in response to low $30s oil prices. The latter has since recovered to the $50 dollar zone – bringing S&P 500 earnings back to $104.61 during the current quarter. The question remains: How does an aging business cycle and immense global headwinds justify the expectation of a red hot earnings breakout during the next 18 months? Yet that’s what’s happening on Wall Street. We’ve hit nearly $133 per share of GAAP earnings (and $145 of the ex-items variety) for the LTM period ending in December 2018, meaning a prospective surge of 27%.

[..] In this machine driven market, any of these indices could resume their mad momentum based climb. But negative divergences are breaking out everywhere, and that’s usually a sign that the end is near. Margins on debt has again reached an all-time high of $550 billion. The chart below leaves little doubt as to what comes next. After the 2000 peak, margin debt collapsed by 50% as stocks were violently liquidated to meet margin calls. All this while in 2008 the shrinkage of margin debt was even larger – nearly 60%. This time, however, a similar shrinkage would cause a $325 billion decline in margin balances. That’s a lot of stocks on a fire sale.

Read more …

“..outstanding bank loans and total social financing, both of which rose roughly 13% in July versus the same period last year..”

China Has Got To Fix Its Debt Problem, IMF Says (CNBC)

China’s economy is looking good enough that the IMF is raising its outlook, but the organization is doing so with a strong warning over growing debt in the world’s second-largest economy. The IMF issued its annual review of China on Tuesday, and has revised its growth forecast to 6.7% for 2017, which was up from 6.2%. The organization also said it expects China to average 6.4% growth between now and 2021, versus its previous estimate of 6%. Still, the organization warned that things were far from peachy. “The growth outlook has been revised up reflecting strong momentum, a commitment to growth targets, and a recovering global economy,” the IMF said. “But this comes at the cost of further large and continuous increases in private and public debt, and thus increasing downside risks in the medium term.”

What Beijing needs to do is to seize its current strong growth momentum “to accelerate needed reforms and focus more on the quality and sustainability of growth,” said the report. At the top of that list is working to tackle the debt issue: Going forward, the IMF sees China’s non-financial sector debt to hit nearly 300% of GDP by 2022, up from around 240% last year. Debt-fueled growth, the IMF warned, is a short-term solution that isn’t sustainable in the long run unless China tackles deeper structural issues. Experts have been sounding the alarm bell over this issue for years, urging China to rein in its old model of opening credit lines to fuel investment and spending and to find a better balance between supporting growth and controlling risks to the economy.

Chinese banks extended 825.5 billion yuan (about $123.44 billion) in new loans in July, down from 1.54 trillion yuan in June. Outstanding total social financing — a broad measure of credit and liquidity — came in at 1.22 trillion yuan last month versus 1.78 trillion yuan in June. Part of the drop is seasonal, and it’s “masking an uptick in underlying credit growth,” wrote China economist Julian Evans-Pritchard at Capital Economics. A better way to look at credit creation is to gauge growth in outstanding bank loans and total social financing, both of which rose roughly 13% in July versus the same period last year.

Read more …

As long as things look good for the Party Congress, who cares?

China Money Supply Growth Slips Again as Leverage Crunch Goes On (BBG)

Growth in China’s broad money supply slipped to a fresh record low, signaling authorities aren’t letting up in their drive to curb excess borrowing and safeguard the financial system. Aggregate financing stood at 1.22 trillion yuan ($182.7 billion) in July, the People’s Bank of China said on Tuesday, compared with an estimated 1 trillion yuan in a Bloomberg survey. New yuan loans stood at 825.5 billion yuan, versus an projected 800 billion yuan. Broad M2 money supply increased 9.2%, while economists forecast a 9.5% increase . Authorities pushing to cut excess leverage have squeezed the massive shadow bank sector, which shrank for the first time in nine months. Yet with aggregate financing remaining robust and bond issuance rebounding, the central bank is still providing ample support for businesses to avoid derailing growth ahead of a key Communist Party congress this fall.

Slower M2 growth will become a “new normal,” the PBOC said Friday in its quarterly monetary policy report. “The relevance of M2 growth to the economy and its predictability has reduced, and its changes should not be over-interpreted.” “The deleveraging campaign is still focused on the financial sector, which leads to the slowdown in M2 growth,” said Yao Shaohua at ABCI Securities in Hong Kong. “Bank support for the real economy remains solid.” “The easing in credit conditions in July was probably part of the concerted stability play ahead of the Party Congress, thus more likely to be temporary,” said Yao Wei, chief China economist at Societe Generale in Paris. “We’re still looking for more deleveraging measures and tougher regulations afterwards.”

“The divergence between M2 growth and aggregate financing reflects that the PBOC is trying to balance cutting leverage while ensuring enough funds to support the real economy,” said Wen Bin at China Minsheng Banking in Beijing. “Single-digit M2 growth is likely to stretch until year-end. And with ample support from the central bank’s credit supply, the drag effect of financial deleveraging on the economic expansion will be limited.” “Banks are still creating credit, and this credit is important to support economic growth,” said Iris Pang, an analyst at ING in Hong Kong. “If liquidity is too tight, or credit growth shrinks, the whole deleveraging reform will run into the risk that there will be too many defaults and the whole banking system will be shaken up.”

Read more …

“..first-time buyer registrations drop by almost 20% on the year..”

UK Risks ‘Losing Its Place As Property-Owning Democracy’

The UK risks losing its place as a property-owning democracy if house prices continue to rise, according to the boss of the UK’s largest independent estate agent. Paul Smith, chief executive of haart, said that “unaffordability is reaching crisis point” and urged the Government to stop “excessive profiteering” at the expense of aspiring home owners. The call comes as official figures showed that the price of the average house in the UK increased by £10,000 last year to £223,000. Property values increased by 0.8% between May and June according to joint figures from the Office for National Statistics, Land Registry and other bodies. In the year to June average prices were up 4.9%, down marginally from 5% growth in the year to May.

The report released on Tuesday said the annual growth rate had slowed since mid-2016 but has remained steady at about 5% this year so far. “House prices continued to rally with unflinching determination once again in June despite the ongoing economic uncertainty,” Mr Smith said. “However this means that the average UK buyer now has to fork out an extra £10,000 more to own a home than the same time last year. “Along with consumer price hikes and falling wage growth, unaffordability is reaching a crisis point. This is creating real impact on the ground as we see first-time buyer registrations drop by almost 20% on the year across our branches.”

Read more …

“..if you’re lucky enough to not be living in your parents’ basement, you’ll be relegated to renting your house from Blackstone.”

The New American Dream: Rent Your Home From A Hedge Fund (Black)

About a month ago I joined the Board of Directors of a publicly-traded company that invests in US real estate. The position brings a lot of insight into what’s happening in the US housing market. And from what I’m seeing, the transformation that’s taking place today is extraordinary. Buying and renting out single-family homes has long been the mainstay investment of small, independent, individual investors. The big banks and hedge funds pretty much monopolize everything else. They own the stock market. They own the bond market. They own all the commercial real estate. They even own the farmland. Single-family homes were one of the last bastions of investment freedom for the little guy. (Real estate is how I got my own start in business and investing so many years ago; I was a 21-year-old Army lieutenant fresh out of the academy when I bought my first rental property.)

But all that’s changing now. Last week a huge merger was announced between Invitation Homes (owned by private equity giant Blackstone Group) and Starwood Waypoint Homes (owned by real estate giant Starwood Capital). If the deal goes through, the combined entity would be the largest owner of single-family homes in the United States with a portfolio worth over $20 billion. And this is only the latest merger in an ongoing trend. Three years ago, for example, American Homes 4 Rent bought Beazer Pre-Owned Rental Homes, creating another enormous player. A few months later, Starwood Waypoint bought Colony American Homes. And of course, Blackstone was one of the first institutional investors to start buying distressed homes, forking over around $10 billion on houses since the Great Financial Crisis.

[..] medium-sized funds are buying up all the little guys. And mega-funds like Blackstone are buying up all the medium-sized funds. This means there’s essentially an ‘arms race’ building among the world’s biggest funds to control the market, squeezing small, individual investors out of the housing market. [..] the average guy isn’t making any more money, or able to save anything… all while home prices soar to record levels as major funds gobble up the supply. This means that the new reality in America, especially for young people, is that if you’re lucky enough to not be living in your parents’ basement, you’ll be relegated to renting your house from Blackstone.

Read more …

Prolonging the emergency with America’s own bridges to nowhere.

Trump Signs Order to Speed Up Public-Works Permits (BBG)

President Donald Trump signed an executive order Tuesday that’s designed to streamline the approval process for building roads, bridges and other infrastructure by establishing “one federal decision’’ for major projects and setting an average two-year goal for permitting. “This over-regulated permitting process is a massive self-inflicted wound on our country,” Trump said in a press conference at Trump Tower in New York. “It’s disgraceful.” Among other things, the president’s order will rescind a previous decree signed by former President Barack Obama that required federal agencies to account for flood risk and climate change when paying for roads, bridges or other structures.

It also allows the Office of Management and Budget to establish goals for environmental reviews and permitting of infrastructure projects and then track their progress – with automatic elevation to senior agency officials when deadlines are missed or extended, according to the order. The order calls for tracking the time and costs of conducting environmental reviews and making permitting decisions, and it allows the budget office to consider penalties for agencies that fail to meet established milestones. Critics say there’s danger in streamlining the reviews. “This is yet another outrageous example of Trump’s insistence on putting corporate interests ahead of people’s health and safety,” said Alex Taurel, deputy legislative director with the League of Conservation Voters, a political advocacy group.

Read more …

Way too late.

German Challenge To ECB QE Asset Buys Sent To European Court (R.)

The European Central Bank may be violating laws on monetary financing in its €2.3 trillion ($2.7 trillion) asset purchase programme, Germany’s constitutional court said on Tuesday, and it asked Europe’s top court to make a ruling. In the biggest challenge yet to the ECB’s unprecedented effort to revive growth, the court said bond buys under the scheme may go beyond the bank’s mandate and inhibit euro zone members’ activities. “Significant reasons indicate that the ECB decisions governing the asset purchase programme violate the prohibition of monetary financing and exceed the monetary policy mandate of the European Central Bank, thus encroaching upon the competences of the Member States,” the court said. It said it would ask the European Court of Justice to review the programme.

The ECB acted swiftly to defend the scheme. “The extended asset purchase programme is in our opinion fully within our mandate,” it said in a statement. “That is ultimately for the European Court of Justice to assess.” It said the €60 billion per month asset buys would continue as normal. The European court has already backed the ECB’s more contentious emergency bond purchase scheme known as Outright Monetary Transactions or OMT with only relatively minor limitations, suggesting that the challenge – lodged by several academics and politicians – may face an uphill battle. The decision to pass the issue over to the ECJ means any final ruling will come either after the bond purchases end or near the end of the scheme, which has already been running for over two years and is expected to be wound down next year.

Read more …

“The same State Department Official had written of Gadaffi in Libya that combining its oil wealth with public ownership of the economy “enabled Libyans to live beyond the wildest dreams of their fathers, and grandfathers.”

Washington’s Long War on Syria (Ren.)

From Syria, to Iraq, Iran to Libya, our understandings of the long-wars in the Middle-East as moral, humanitarian interventions designed to democratise and civilise are the result of a carefully crafted propaganda campaign waged by the US and its allies. Each of these uprisings were launched by US proxies, designed to destabilize the regions, justifying regime change that suit the economic interests of its investors, banks and corporations, captured comprehensively in a new book by Canadian author and analyst, Stephen Gowans, Washington’s Long War on Syria. You might be surprised to know that both the Libyan, Syrian and Iraqi government, led by Muammar Gaddafi, Hafez Al Assad, (succeeded by Bashaar Al Assaad) and Sadaam Hussein respectively, were socialist governments. Or Ba’ath Arab Socialist governments, to be precise.

Ba’ath Arab Socialism can be summed up in their constitutions supporting the values of: ‘freedom of the Arab world, freedom from foreign powers and freedom of socialism’. Its doctrine was supported in Libya, as it was in Iraq and Syria. Of course, particularly in Hussein’s case, we cannot claim that these governments were without their problems. Ethnic cleansing is not to be overlooked, but condemned on the strongest grounds. But of course these were not the reasons the US and its allies decided to get into it. In the case of Iraq, it had combined its oil wealth with public ownership of the economy, leading to what is known as ‘The Golden Age’, where, according to a State Department Official: “Schools, universities, hospitals, factories, museums and theatres proliferated employment so universal, a labour shortage developed.”

When the Ba’ath Arab Socialists were driven from power in Iraq, the US installed military dictator, Paul El Briener who set about a ‘de-Ba’athification’ of the government, expelling every member of the Ba’ath Arab Socialist party and imposed a constitution forbidding any secular Arab leader from ever holding office in Iraq again. The same State Department Official had written of Gadaffi in Libya that combining its oil wealth with public ownership of the economy “enabled Libyans to live beyond the wildest dreams of their fathers, and grandfathers.” Gadaffi would soon be removed by Islamists, backed by NATO forces after Western oil companies agitated for his removal because he was “driving a hard bargain”. Canadian paramilitary forces even quipped that they were “al-Qaeda’s air-force”.

Read more …

And then we eat it. Carbon will kill us yet.

Fish Confusing Plastic Debris In Ocean For Food (G.)

Fish may be actively seeking out plastic debris in the oceans as the tiny pieces appear to smell similar to their natural prey, new research suggests. The fish confuse plastic for an edible substance because microplastics in the oceans pick up a covering of biological material, such as algae, that mimics the smell of food, according to the study published on Wednesday in the journal Proceedings of the Royal Society B. Scientists presented schools of wild-caught anchovies with plastic debris taken from the oceans, and with clean pieces of plastic that had never been in the ocean. The anchovies responded to the odours of the ocean debris in the same way as they do to the odours of the food they seek. The scientists said this was the first behavioural evidence that the chemical signature of plastic debris was attractive to a marine organism, and reinforces other work suggesting the odour could be significant.

The finding demonstrates an additional danger of plastic in the oceans, as it suggests that fish are not just ingesting the tiny pieces by accident, but actively seeking them out. Matthew Savoca, of the National Oceanic and Atmospheric Administration and lead author of the study, told the Guardian: “When plastic floats at sea its surface gets colonised by algae within days or weeks, a process known as biofouling. Previous research has shown that this algae produces and emits DMS, an algal based compound that certain marine animals use to find food. [The research shows] plastic may be more deceptive to fish than previously thought. If plastic both looks and smells like food, it is more difficult for animals like fish to distinguish it as not food.”

Read more …