Oct 242020
 


Henri Matisse Le Bonheur de Vivre 1906

 

Russian Data Reveals Diabetics Ten Times More Likely To Catch COVID19 (RT)
Kremlin Says US Elections Have Become “Competition In Russophobia” (ZH)
MSM Beat The Bidens To Declare Laptop Leak ‘Russian Disinformation’ (RT)
Millions Of Insurance Plans Were Cancelled Due To Obamacare (JTN)
FBI, GSA Undermined 2016 Transition By Sharing Private Trump Team Records (JTN)
Differences in How Democrats and Republicans Behave on Twitter (Pew)
If Trump Wins, My Profession Is Done: Pollster (RT)
Bleeding Out (Jim Kunstler)
AOC Blasts Republicans For Calling Her AOC (JTN)
YouTube Is Selling So Many Political Ads It Has Run Out Of Videos For Them (ZH)
European Data Considers Coronavirus Risk in Greece Mainly Low to Medium (GR)
Tesla, Ordered To Recall 30,000 Cars In China, Blames ‘Driver Abuse’ (LAT)

 

 

 

 

Tulsi Gabbard Daniel Ellsberg
“A whistleblower cannot get a fair trial”

 

 

What’s worse: ..coronavirus could be causing “an entirely new form of diabetes.”

Russian Data Reveals Diabetics Ten Times More Likely To Catch COVID19 (RT)

Diabetics are 10.3 times more likely to develop Covid-19, and their symptoms are more severe and life-threatening, with over a quarter of all infected patients already suffering from the illness as a pre-existing condition. That’s according to Russian Deputy Prime Minister Tatyana Golikova, who told officials that coronavirus is especially dangerous for those suffering with the common metabolic disorder. “In patients with diabetes, Covid-19 infection is 10.3 times more common,” Golikova explained. “Patients with diabetes experience the disease more severely, and more frequently develop acute respiratory distress syndrome, as well as respiratory failure, [requiring] artificial ventilation and, unfortunately, [experiencing] higher mortality.”


According to Golikova, 27 percent of all infected patients have diabetes among their comorbidities, and this is often complicated by increased glycemia. As of the start of 2020, 5.1 million people in Russia had a diabetes diagnosis. She noted that the risk is even higher in patients with high blood pressure. Curiously, earlier this week, American Covid-19 patient Mario Buelna experienced exactly the opposite situation – he developed diabetes for the first time, having contracted coronavirus. According to his doctors in Mesa, Arizona, Buelna’s diabetes was triggered by Covid-19. Speaking to London-based news agency Reuters, Dr. Robert Eckel, president of medicine and science at the American Diabetes Association, thinks that coronavirus could be causing “an entirely new form of diabetes.”

Read more …

“..competition in Russophobia has become a constant in all US electoral processes, regrettably.”

Kremlin Says US Elections Have Become “Competition In Russophobia” (ZH)

This week’s perhaps overly dramatic announcement Wednesday night by the heads of multiple federal agencies – foremost among them Director of National Intelligence John Ratcliffe – alleging new major efforts by Russia and Iran to interfere in the US presidential election formed a key question and talking point by debate moderator Kristen Welker Thursday night. Welker even referenced as somehow undisputed and settled “truth” the now debunked “Russian bounties” story. Over a month ago the Pentagon and other intelligence heads concluded after an exhaustive investigation that there’s simply no evidence to suggest Russian military intelligence paid Afghan fighters to target Americans.


Russia was certainly paying attention to the debate and was not amused. The Kremlin on Friday blasted what it said was “Russophobia” at the center of the debate. Kremlin Spokesman Dmitry Peskov told journalists Friday that “competition in Russophobia has become a constant in all US electoral processes, regrettably.” “We are fully aware of this and can only express regret,” he added as quoted in TASS. “After all, probably, it is the American electorate who is the target audience of these debates, that is, common Americans. It is up to them to decide who won the debate, not us,” the spokesman said. Indeed the American public is by and large likely growing tired of the endless Russia scapegoating too.

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“Joe Biden is supposed to deny and deflect attention from damaging information. He’s a politician, after all – it’s his job. The press is supposed to do the exact opposite.”

MSM Beat The Bidens To Declare Laptop Leak ‘Russian Disinformation’ (RT)

It’s not the media’s job to cover for Joe Biden. Yet the New York Times and its ilk have fallen over themselves to call the damaging leaks “Russian disinformation,” while also awkwardly publishing the FBI’s denial of the claim. As President Donald Trump and former Vice President Joe Biden geared up to debate on Thursday night, the cable TV commentariat wondered how Trump would bring up the “laptop from hell.” Recovered from a Delaware repair shop last year and handed to Trump’s attorney Rudy Giuliani, the laptop – which allegedly belonged to Joe’s son, Hunter – contained a tranche of emails that implicated the Biden family in numerous foreign graft schemes, all while Joe was in the White House.

Before the debate kicked off, the New York Times quoted the Director of National Intelligence (DNI) as saying: “No concrete evidence has emerged that the laptop contains Russian disinformation,” and the FBI as seconding this claim. For the Times, it was a dramatic turnaround. Just days earlier, before the FBI and DNI could weigh in, a headline in the nation’s paper of record read, “Is the Trump campaign colluding with Russia again?” Quoting only a Senate Democrat, the Times alleged that Giuliani had been cultivated as an “asset” by the Kremlin, and “any information proffered by Rudy Giuliani is likely compromised.” The Washington Post sang from the same hymn sheet, using the usual anonymous “former officials” to tie Giuliani to Russia.

Even before the media settled on Russia as the culprit, MSNBC’s Joe Scarborough called the scandal “made up” and a “hokey story,” while NBC’s Hallie Jackson described it as “dubious” and “questionably sourced.” As the Times and Post rang the Russia alarm last week, neither the FBI nor DNI had commented on the laptop. DNI John Ratcliffe would do so on Monday, and the FBI followed suit a day later. In fact, as these articles hit the presses, the only people who had fingered Russia for the stunt were a collection of Biden’s aides and advisors, who gave no evidence to support their claims. The Biden campaign itself didn’t embrace the Russia excuse until several days later. It’s one thing to cover a candidate sympathetically. It’s another to work as his preemptive press corps. Joe Biden is supposed to deny and deflect attention from damaging information. He’s a politician, after all – it’s his job. The press is supposed to do the exact opposite.

Read more …

But Biden can make the claim uncontested that number is zero.

Millions Of Insurance Plans Were Cancelled Due To Obamacare (JTN)

Democratic presidential nominee Joe Biden said during Thursday night’s debate that nobody lost their health insurance plans when Obamacare was fully implemented, but millions of individuals had their insurance policies cancelled at the time. A RAND Corporation study estimated that 5.9 million people lost their insurance plans due to Obamacare’s rules and regulations. Obamacare is the 2010 health care law crafted by former President Obama, for whom Biden served as vice president for both of his terms. Obama was heavily criticized at the time for telling Americans that if “you like your plan, you can keep your plan,” which turned out not to be the case. Politifact rated Obama’s promise the “lie of the year” in 2013.

Trump and Biden each were asked Thursday night how they would handle health care policy if the Supreme Court invalidates Obamacare’s individual mandate in the upcoming California v. Texas case. “What I’m going to do is pass Obamacare with a public option. It will become Bidencare. The public option says in fact if you do not have the wherewithal, if you qualify for Medicaid and you do not have the wherewithal in your state to get Medicaid, you’re automatically enrolled, providing competition for insurance companies,” Biden said. Biden rejected the idea that he wants to eliminate private insurance. “Not one single person with private insurance would lose their insurance under my plan, nor did they under Obamacare. They did not lose their insurance unless they chose they wanted to go to something else,” he said.

In response, Trump said Biden’s health care plan would amount to socialized medicine, given that the federal government would run the public option.

Bernie Biden

Read more …

This is the most severe of all. This is also why they complain in advance about Trump not doing a peaceful transition. Because they themselves did not.

FBI, GSA Undermined 2016 Transition By Sharing Private Trump Team Records (JTN)

A Senate report released today claims that the Federal Bureau of Investigation and the General Services Administration undermined the Trump transition team in 2016 by sharing private Trump team records in violation of an agreement between that team and the GSA. The majority staff report from both the Senate Committee on Finance and the Committee on Homeland Security and Governmental Affairs claims that officials from both the FBI and Mueller’s office “secretly sought and received access to the private records of Donald J. Trump’s presidential transition team, Trump for America, Inc.”

“They did so,” the report continues, “despite the terms of a memorandum of understanding between the Trump transition team and the General Services Administration…—the executive agency responsible for providing services to both candidates’ transition teams—that those records were the transition team’s private property that would not be retained at the conclusion of the transition.” The report states that officials at the GSA proactively called the FBI and offered to retain Trump transition team records following the controversy surrounding Michael Flynn’s resignation as national security adviser in early 2017. The agency informed neither the White House nor Trump for America of that decision. Those records would eventually make their way to Mueller’s office, the report says.

“At bottom,” the report continues, “the GSA and the FBI undermined the transition process by preserving Trump transition team records contrary to the terms of the memorandum of understanding, hiding that fact from the Trump transition team, and refusing to provide the team with copies of its own records.” “These actions have called into question the GSA’s role as a neutral service provider, and those doubts have consequences,” the report adds. “Future presidential transition teams must have confidence that their use of government resources and facilities for internal communications and deliberations—including key decisions such as nominations, staffing, and significant policy changes—will not expose them to exploitation by third parties, including political opponents.”

Amanda Milius The Plot Against the President

Read more …

And guess who gets censored?

Differences in How Democrats and Republicans Behave on Twitter (Pew)

Most U.S. adults on Twitter post only rarely. But a small share of highly active users, most of whom are Democrats, produce the vast majority of tweets. The Center’s analysis finds that just 10% of users produced 92% of all tweets from U.S. adults since last November, and that 69% of these highly prolific users identify as Democrats or Democratic-leaning independents. A number of factors contribute to this phenomenon. Previous Twitter analyses by the Center have found that the platform contains a larger share of Democrats than Republicans. And in addition to being more prevalent on the site in general, the 10% most active Democrats typically produce roughly twice as many tweets in a month (157) as the 10% most active Republicans (79).

Across both parties, those who use Twitter differ in several ways compared with non-users. For instance, Twitter-using Democrats and Republicans alike tend to be younger and have higher levels of educational attainment compared with members of each party who do not use the platform. Although nearly identical shares of Republican Twitter users (60%) and non-users (62%) describe themselves as very or somewhat conservative, Democrats who use Twitter tend to be more liberal than non-users. Some 60% of Democrats on Twitter describe their political leanings as liberal (with 24% saying they are “very” liberal), compared with 43% among those who are not Twitter users (only 12% of whom say they are very liberal).

Beyond posting volume, Democrats and Republicans also differ from each other in their actual behaviors on the platform. For instance, the two accounts followed by the largest share of U.S. adults are much more likely to be followed by users from one party than the other. Former President Barack Obama (@BarackObama) is followed by 42% of Democrats but just 12% of Republicans, while President Donald Trump (@realDonaldTrump) is followed by 35% of Republicans and just 13% of Democrats. Many other popular accounts are followed primarily by those who identify as either Democrat or Republican. However, a small number of the most-followed accounts on Twitter (mostly popular celebrities or entertainers) are followed by similar shares of U.S. adults belonging to each party.

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I don’t think so. If it didn’t happen in 2016, why would it now?

If Trump Wins, My Profession Is Done: Pollster (RT)

Polling guru Frank Luntz has admitted that if Donald Trump wins re-election, his “profession is done.” Though polls show Joe Biden in the lead, Luntz and his colleagues are hedging their bets and preparing to be shocked… again Democratic candidate Joe Biden is leading President Donald Trump by up to 10 points nationwide. Yet polls can be wrong, and for all the talk of a Biden “landslide” in the media, Trump’s supporters likely remember 2016, when their candidate pulled off a shock victory against Hillary Clinton, despite being given only a seven percent chance of winning by the New York Times two weeks before election day. Should Trump once again dispatch his Democratic challenger, the polling industry is finished, Republican pollster Frank Luntz told Fox News on Thursday.

“Well, I hate to acknowledge it, because that’s my industry,” he told Fox anchor Bret Baier. “But the public will have no faith. No confidence. If Donald Trump surprises people… my profession is done.” Luntz insists that his polling is accurate this time, and that Biden will win. However, undecided voters may be leaning toward Trump. As the two men faced off in the final presidential debate in Tennessee on Thursday night, Luntz organized a focus group of undecided voters. After the showdown, a majority of these voters were leaning toward backing Trump. They described him as “controlled,” “poised,” and “surprisingly presidential,” while Biden was thought of as “vague,” “elusive,” and “defensive.”

Luntz is a longtime critic of Trump, and a recently released email – found on Hunter Biden’s now-infamous laptop – apparently showed him massaging his predictions in favor of Biden back in 2012, when the then-VP was debating Mitt Romney’s running mate, Paul Ryan. Luntz appeared to confirm the email’s authenticity in a tweet, but denied it was any kind of bombshell, saying he’s known the Biden family since the 1990s. However, if a Biden-friendly pollster, backed by his latest focus group, is publicly opening the door to a potential Trump victory, the election gurus may not be as confident in their figures as they let on.

Read more …

“Is Hillary ironing her purple pantsuit up in Chappaqua, awaiting the emergency call from her DNC?”

Bleeding Out (Jim Kunstler)

“The difference between you and me,” Mr. Trump said to the ever more ghostly Joe Biden, fading mentally late in the action on the debate stage, “is that I’m not a politician and you are, and you’re a crooked politician.” Millions watching this spectacle might not have noticed, due to the media’s near-complete blackout of news detailing the Biden family’s adventures in systematic global moneygrubbing, but the Democratic candidate for president has political Ebola, a hemorrhagic fever of credibility, now gushing out of every pore and orifice.

Twitter and Facebook may try to squelch the story, but the evidence is all over the Internet now, like blood on a crime scene, in verifiable emails, texts, Snapchats, memoranda, and bank records that Ol’ White Joe Biden is at the center of a decades-long influence-peddling spree, selling his personal services to China, Russia, Ukraine, and any other country seeking favors in US government policy, and that this slime-trail of grift disqualifies him from holding high office as much as the irreversible rot of his cognitive abilities.

The “Laptop from Hell” affair has twelve more days to play out before the November 3 vote and the Democratic Party is in a terrible jam. Do they ask Mr. Biden to step aside, or do they keep running with him while the barrage of allegations and hard evidence pours down on them like so many mortar rounds on a besieged bunker? It’s obvious now that one way or another, voters are actually being asked to elect Kamala Harris president — but who asked for her? Only the disgraced and disabled head of the ticket, Joe Biden, desperate for a non-white running mate. Elsewise, she was so disliked by voters that she skulked out of the Iowa caucuses, ending her own run. Is Hillary ironing her purple pantsuit up in Chappaqua, awaiting the emergency call from her DNC?

The early 2020 impeachment gambit has finally blown up in the Democrats’ faces, too, as it’s now obvious the phony furor over Mr. Trump’s phone call to Ukraine President Zelensky was ginned up to smother any inquiry into Hunter Biden’s $83,000-a-month services to the Burisma gas company and its crooked chief, Mykola Zlochevsky, with help from then US Ambassador to Ukraine Marie Yovanovitch and several of her staff, as well as then Secretary of State John Kerry.

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On to more important matters.

AOC Blasts Republicans For Calling Her AOC (JTN)

Her name is a mouthful, so Alexandria Ocasio-Cortez became AOC. In fact, she calls herself AOC. “Team AOC is hiring!” she wrote on Twitter in August, for instance. But the first-term Democratic Socialist from New York bristles when Republicans call her AOC, as President Trump did during Thursday night’s debate with Joe Biden. “I wonder if Republicans understand how much they advertise their disrespect of women in debates when they consistently call women members of Congress by nicknames or first names while using titles & last names when referring to men of = stature. Women notice. It conveys a lot,” she wrote on Twitter.

“AOC is a name given to me by community & the people. Y’all can call me AOC. Government colleagues referring to each other in a public or professional context (aka who don’t know me like that) should refer to their peers as ‘Congresswoman,’ ‘Representative,’ etc. Basic respect 101,” she added. Twitterers pointed out that President Trump calls nearly all of his opponents, regardless of gender, by nicknames — some not so nice. Trump calls Sen. Elizabeth Warren (D-Mass.) “Pocahontas” for her false claims that’s she’s Native American. He calls Sen. Richard Blumenthal, the Connecticut Democrat who falsely claimed to have fought in the Vietnam War, “Da Nang Dick.” Jeb Bush was, of course, “Low Energy Jeb.” Then there’s “Crooked Hillary,” “Lyin’ Leakin’James Comey,” “Jeff Flakey,” “Head Clown Chuck Schumer,” and “Mad Maxine Waters.”

So AOC isn’t all that bad, is it? “You do this all the time, referring to ‘Trump’ or ‘Pence,'” Fee Online contributor Brad Polumbo wrote on Twitter. “Just *stop* with the endless self-victimization. It’s pathetic and tiring.” “Yes, names like Crying Chuck Schumer and Crazy Bernie are super sexist,” wrote another. In fact, AOC has another nickname for her and three colleagues — “The Squad,” which includes Reps. Ayanna Pressley (D-Mass.), Ilhan Omar, (D-Minn.) and Rashida Tlaib (D-Mich.). That’s who Trump referred to in Thursday’s debate. “They know nothing about the climate,” Trump said, referring to AOC’s “New Green Deal” environmental plan. “I mean, she’s got a good line of stuff, but she knows nothing about the climate. And they’re all hopping through hoops for AOC plus three. Look, their real plan costs $100 trillion.”

And one Twitterer pointed out that AOC isn’t even a nickname: “AOC is not a nickname, they’re your initials. JFK is also not a nickname. The FBI, again, is not a nickname. You can maybe say that Trump should’ve still used your official title, but Obama was also referenced sans title, and you don’t see him whining about it on Twitter …”

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“..commercial ads have been “anemic”..”

YouTube Is Selling So Many Political Ads It Has Run Out Of Videos For Them (ZH)

While social media makes its best attempt at trying to get Joe Biden elected by censoring stories about his son, YouTube is facing another dilemma: the platform is so inundated with political ads it has nowhere to put them. As advertising campaigns flood the platform, YouTube has “struggled” to place the ads in front of the desired audience for each, according to Bloomberg. Interestingly enough, YouTube is experiencing the shortage most in “critical swing states”, where ad prices have doubled as a result. This, obviously, makes political advertising far more lucrative for Google, who saw ad revenue fall this year and will announcing its earnings next week.

Cat Stern, media director for Lockwood Strategy Lab, a digital campaign agency focused on Democratic candidates and progressive advocacy organizations, told Bloomberg: “There’s a crunch. All political advertisers are buying in the same states, to similar audiences.” YouTube viewers have risen during the pandemic and while commercial ads have been “anemic”, political ads have spiked heading into November 3. In highest demand are the ads that users aren’t allowed to skip through. There are also ad “reservations” for YouTube’s most popular videos that are in high demand. Reid Vineis, vice president of digital at Majority Strategies, a Republican political ad firm, said: “The reserves tend to be gobbled up by well-funded campaigns.”

While this occurs, other less-well-funded campaigns have turned to platforms like Hulu and Roku to run their ads. Some states, like Iowa, are usually entirely sold out on YouTube. Tim Cameron, co-founder of FlexPoint Media, said: “A lot of late money that’s coming on board — it’s difficult to find anywhere to put it.” At some points, YouTube has been unable to place up to 75% of the amounts that people are willing to spend. YouTube didn’t comment for Bloomberg’s article, but the article notes that a “code yellow” was assigned to Google’s staff regarding the inability to place ads, meaning Google was increasing the resources it was deploying to try and solve the issue.

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We have a mask mandate now. And a curfew.

European Data Considers Coronavirus Risk in Greece Mainly Low to Medium (GR)

According to data released by the European Centre for Disease Prevention and Control (ECDC) on Friday, much of Greece is at a “low” or “medium” risk level for Covid-19. The ECDC records the epidemiological burden across Europe, and classifies either entire countries or regions, depending on their coronavirus risk level. Unlike much of Europe, excluding areas of Central and Northern Europe, which is considered high-risk, much of Greece is at low or medium risk. The regions of Attica, Central Greece, Macedonia, Epirus, are at medium risk, and areas of Central Macedonia belong to the high-risk category. Southern Greece, Eastern Macedonia, and Thrace are all considered very low risk areas.


All European countries, except for Greece, Cyprus, Finland, Estonia, Liechtenstein and Norway, which are considered “stable” by the ECDC, are in a situation of “great epidemiological concern” in terms of the virus. Although the stable countries may report an increase in cases, like Greece, they are still considered to have a relatively low risk level for young and healthy citizens. Older people and those who belong to vulnerable groups in these stable countries are still considered to be of high risk, however. Despite their stable designations, the situation regarding Covid-19 in the six countries should be carefully monitored, as the virus can spread quickly, increasing the countries’ risk level, according to the authorities.

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Best business model: always blame your customers.

Tesla, Ordered To Recall 30,000 Cars In China, Blames ‘Driver Abuse’ (LAT)

Tesla Model S and Model X owners have complained about potentially dangerous flaws with suspension systems at least since 2015. On Friday, the Chinese government took action — and the company responded by blaming the country’s drivers. China’s State Administration for Market Regulation ordered a recall for about 30,000 Model S and Model X vehicles manufactured at Tesla’s Fremont, Calif., plant and exported to China. The affected cars were built from 2013 to 2017. Model S and Model X vehicles sold in the U.S. and Europe were built at the same factory using the same suspension systems. More than 250,000 were sold worldwide. The traffic safety regulator for the United States, the National Highway Traffic Safety Administration, said Friday afternoon it is “aware of the Tesla recall due to suspension problems in China.


At this time, the agency has not received significant complaints related to these issues in the United States. The agency is in contact with Tesla and monitoring the situation closely, and will not hesitate to take action to protect the public against unreasonable risks to safety.” A spokesman declined to say what marks a complaint as significant. [..] in a letter sent by a Tesla attorney to NHTSA on Sept. 4, the company blamed Chinese drivers for the problem, said there was no safety issue, and said it didn’t plan to issue a recall outside China.Tesla owners at the Tesla Motors Club forum have been complaining about suspension issues since at least 2015, complaints that continue to this day. Many report that a ball joint connected to a control arm comes loose.

Read more …

 

 

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“Fall in love with some activity, and do it! Nobody ever figures out what life is all about, and it doesn’t matter.”

Richard Feynman

 

 

Emotions Trump

 

 

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Aug 162020
 


Michael Andrews Lights VII: A Shadow 1974

 

Clinesmith Was Working For Mueller When He Forged That Email (RS)
Democrats Still Denounce This ‘Investigation Of Investigators’ (Turley)
FBI Misled Congress on Reliability of Steele Dossier (SAC)
CIA Behind Guccifer & Russiagate – Binney (SCF)
Biden Campaign Not Putting Any Surrogates On Sunday Shows Pre-Convention (Fox)
Finance Execs Cheer Selection of Kamala Harris as Dem VP (LI)
Hillary Clinton ‘Ready To Help’ In Biden Administration If Asked (NYP)
Biden Accuser Tara Reade Slams Dems For Bill Clinton Convention Speech (NYP)
Info On Wikileaks, “Hacked Information” Banned Under New YouTube Rules (MPN)
PBOC: China’s Yuan Continues To Grow As An International Currency (SCMP)

 

 

US politics has definitely become the new main topic, replacing COVID. The big picture as we now get it from Durham and various declassified docs is that the biggest scandal in America over the past 4-5 years was not alleged Russian support for Trump that allegedly skewed the 2016 election.

Instead, it is that all of that story, not just some or most of it, but all of it, was fabricated from whole cloth by Trump’s opponents in intelligence, media and the Democratic party. With all of Trump’s all too obvious flaws, they elected to go with a fantasy story. It will all make the coming (or ongoing) election season a hot stew of boiling over spices.

Meanwhile, Biden’s people refuse to let anyone go on the habitual Sunday talk shows, Joe remains in the basement, Kamala will be kept far apart from any journalist who might ask an actual question, and Hillary’s ready to “help”.

Which means that if Biden is withdrawn at some point, as seems likely, the US could be governed by two women so unpopular in their own party they both lost seemingly easy votes. Nobody on that side of the divide appears to care. But in the end it’s not the corporate sponsors or the party bigwigs who do the voting, it’s the people; they just hope they’ve spread enough hatred of Trump to get the votes.

 

 

The usual weekend stumble along numbers. US deaths down to 1,071, good enough to ditch the graph.

 

 

 

 

 

 

 

 

 

 

Trump Durham

 

 

It’s in the little details…

Clinesmith Was Working For Mueller When He Forged That Email (RS)

One important fact getting overlooked in all the discussion of whether FBI Attorney Kevin Clinesmith’s guilty plea represents the sacrifice of a minor criminal so the ringleaders can escape justice or the beginning of the end for those who were running the show is exactly whose show Clinesmith was a part of when the crime he’s admitted committing occurred. You see, Clinesmith wasn’t working for James Comey on June 19, 2017, the date he altered that CIA email inconveniently identifying Trump’s onetime foreign policy advisor Carter Page as a trusted source. By that point in time, Clinesmith was part of Robert Mueller’s Independent Counsel investigation. And it was Mueller’s crew who made use of the renewed FISA warrant to spy on Page that Clinesmith’s willingness to commit forgery had enabled.

On the recommendation of acting Attorney General, Rod Rosenstein, Trump had fired Comey on May 9, 2017. As a consequence, Comey’s second-in-command, Andrew McCabe automatically took over as acting FBI Director till June 7, when Trump appointed Christopher Wray. (Wray was interim director until his Senate confirmation on July 20.) McCabe was in charge for less than a month. But within just 8 days he’d started a second investigation of Trump in addition to the still ongoing Crossfire Hurricane probe of his campaign’s ties to Russia. Despite Trump’s having fired Comey at Rosenstein’s urging and the president’s authority to terminate the director of the FBI for any reason he pleases, McCabe wasted no time in using his boss’s dismissal as a pretext to investigate Trump for obstructing Crossfire Hurricane.

Given the enormity of his new responsibilities after suddenly becoming the head of the FBI and how quickly McCabe rushed to add a second investigation of the President of the United States to them, you’d almost think he must have been planning it before Comey was even fired. Interestingly, McCabe had also helped tip over the very first domino that ultimately led to Robert Mueller’s appointment as independent counsel. Though it hasn’t received nearly enough attention, he played a substantial role in ginning up the phony controversy over whether Jeff Sessions lied to Congress about his contacts with Russian ambassador Sergey Kislyak during his confirmation hearing.

Sessions takes a lot of heat for enabling the Mueller probe by recusing himself. But though there’s no question he made a disastrous error, most people aren’t aware of the stuff going on in the background that almost seems like it could have been designed to make Sessions step aside and put Rosenstein in control. A few months before starting that second investigation into whether Trump obstructed justice by taking Rosenstein’s advice, Andrew “Itchy Finger” McCabe had triggered another criminal investigation of Sessions for lying about his contacts with Kislyak at the request of Democratic Sens. Patrick Leahy and Al Franken. The fuss quickly died down and Mueller closed the investigation in January 2018. But the ginned-up controversy did force Sessions to recuse himself; which put Rosenstein in a position to urge Trump to fire Comey; which then put McCabe in the position to start a second investigation of Trump for obstruction of justice for taking Rosenstein’s advice.

Read more …

Tick. Tock. Tick. Tock.

Democrats Still Denounce This ‘Investigation Of Investigators’ (Turley)

“Gosh almighty.” Those words from former Vice President Joe Biden sum up plenty about the announced criminal plea by former FBI lawyer Kevin Clinesmith. Of course, Biden was not referring to the implications of the FBI lawyer who lied to the Foreign Intelligence Surveillance Act court for the efforts to continue the surveillance of an adviser to the campaign of Donald Trump. Nor was he referring to growing evidence that the Russia investigation was launched based on false and flawed evidence. Biden was referring to the federal investigation by United States Attorney John Durham that led to the criminal plea by Clinesmith. Like most other Democrats, Biden previously denounced the investigation and the effort to look into criminality. Now that criminality has been found, Democrats and commentators still insist there are no reasons to continue it.

From the start, Democrats overwhelmingly condemned the investigation despite admitting Durham is a respected prosecutor. Leaders like House Intelligence Committee Chairman Adam Schiff deemed the investigation “tainted” and “political.” Biden mocked the very idea of an “investigation of the investigators” and added, “Give me a break. Gosh almighty.” These are the same figures who repeatedly cited plea agreements in the special counsel investigation by Robert Mueller as proof that real crimes were waiting to be found. When the plea by former White House national security adviser Michael Flynn was announced, it was cited as the critical development even though FBI agents said they did not believe Flynn had intentionally lied about his conversations with Russian diplomats.

Many in the media cited the plea by Flynn to disprove the insistence by Trump that the Mueller investigation was a hoax. But they are not citing the plea by Clinesmith to disprove the statement by Biden. Indeed, they have barely covered it. It does not appear to matter that Clinesmith said “viva la resistance” after the 2016 election or that, after claiming he was devastated by the victory of Trump, he lamented that “my god damned name was all over those legal documents investigating his staff.” But several Democrats and commentators maintained there was never a targeting of the campaign before the special counsel appointment. That was untrue. Declassified documents show that an agent was used with a national security briefing of Trump and his aides during the campaign to gather information for the Russia investigation.

Who did the agent report to? Clinesmith and Peter Strzok at the FBI, who infamously referred to his own “insurance” with the chance that Trump might be elected.

Read more …

The courts AND Congress.

FBI Misled Congress on Reliability of Steele Dossier (SAC)

Documents recently released by the Senate Intelligence Committee indicate that there were strong doubts about the reliability of the Steele Dossier as early as December 2016. As the FBI and CIA worked together to create an Intelligence Community Assessment (ICA) to present to President Barack Obama, those in the CIA camp, according to the now-declassified interviews conducted by the Senate Intelligence Committee, worried that the FBI was playing up the Steele Dossier too much. Sen. Lindsey Graham released a statement on the Senate Judiciary Committee website in which he addressed the newly declassified documents: “This document clearly shows that the FBI was continuing to mislead regarding the reliability of the Steele dossier. The FBI did to the Senate Intelligence Committee what the Department of Justice and FBI had previously done to the FISA Court: mischaracterize, mislead and lie.


The characterizations regarding the dossier were completely out of touch with reality in terms of what the Russian sub-source actually said to the FBI. “What does this mean? That Congress, as well as the FISA Court, was lied to about the reliability of the Russian sub-source. I will be asking FBI Director Wray to provide me all the details possible about how the briefing was arranged and who provided it. “Inspector General Horowitz’s team found this briefing document. Inspector General Horowitz and his team deserve great credit for uncovering systematic fraud at the Department of Justice surrounding the Carter Page FISA warrant. I’m also very appreciative of the Department of Justice’s release of the FBI document used to brief the Senate Intelligence Committee.”

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We’ve known this for a long time. But nobody wants to report on it.

CIA Behind Guccifer & Russiagate – Binney (SCF)

William Binney and other independent former U.S. intelligence experts say they can prove the Russiagate narrative is bogus. The proof relies on their forensic analysis of the data released by Guccifer. The analysis of timestamps demonstrates that the download of voluminous data could not have been physically possible based on known standard internet speeds. These independent experts conclude that the data from the Democrat party could not have been hacked, as Guccifer and Russiagaters claim. It could only have been obtained by a leak from inside the party, perhaps by a disgruntled staffer who downloaded the information on to a disc. That is the only feasible way such a huge amount of data could have been released. That means the “Russian hacker” claims are baseless.

Wikileaks, whose founder Julian Assange is currently imprisoned in Britain pending an extradition trial to the U.S. to face espionage charges, has consistently maintained that their source of files was not a hacker, nor did they collude with Russian intelligence. As a matter of principle, Wikileaks does not disclose the identity of its sources, but the organization has indicated it was an insider leak which provided the information on senior Democrat party corruption. William Binney says forensic analysis of the files released by Guccifer shows that the mystery hacker deliberately inserted digital “fingerprints” in order to give the impression that the files came from Russian sources.

It is known from information later disclosed by former NSA whistleblower Edward Snowden that the CIA has a secretive program – Vault 7 – which is dedicated to false incrimination of cyber attacks to other actors. It seems that the purpose of Guccifer was to create the perception of a connection between Wikileaks and Russian intelligence in order to beef up the Russiagate narrative. “So that suggested [to] us all the evidence was pointing back to CIA as the originator [of] Guccifer 2.0. And that Guccifer 2.0 was inside CIA… I’m pointing to that group as the group that was probably the originator of Guccifer 2.0 and also this fabrication of the entire story of Russiagate,” concludes Binney in his interview with Sputnik news outlet.

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“I don’t understand what’s going on here. This is the damnedest thing I’ve ever seen that you would you know, you’re basically giving a campaign…”

Biden Campaign Not Putting Any Surrogates On Sunday Shows Pre-Convention (Fox)

Chris Wallace – Host of Fox News Sunday & Author of “Countdown 1945: The Extraordinary Story of the Atomic Bomb and the 116 Days that Changed the World ” spoke with Fox News Radio’s Guy Benson about the upcoming DNC convention. Wallace spoke to why the Biden campaign isn’t putting any campaign surrogates on any of the Sunday shows the weekend before the DNC convention. Saying,

“So I’ve been doing Sunday shows with conventions. I started on Meet the Press in 1988. I’ve been doing it on and off. For what? What is that? Thirty two years. And and it always happens that the Sunday before the convention. The campaign puts out top officials to preview the convention and to say this is what we’re gonna try to get accomplished. So, you know, we put counting all week on, you know, having a top official from the Biden campaign, the campaign manager, the top pollster, the chief strategist, to talk about what they’re going to talk about during this next week. They are not putting anybody out. And at first I thought, well, maybe it’s because it’s Fox News and they’re boycotting us. No, they’re not putting anybody out on any of the Sunday shows point.

I don’t understand what’s going on here. This is the damnedest thing I’ve ever seen that you would you know, you’re basically giving a campaign. And as I say, it’s a traditional thing. We’re gonna do it for the Republicans a week from Sunday. What are you trying to accomplish this week? And they the Biden campaign isn’t putting anybody out. And this just is of a piece with the the vice president not not doing really any serious interviews, not answering any questions since the rollout. I don’t you know, you can you can try and I understand and has worked pretty well. And he continues to lead with what I’ll call the basement strategy. I don’t think you can hide from now until Election Day. I just I just don’t think it’s possible.”

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This should cause many on the left to not vote for her and Joe. “She’s a great fundraiser”…

Finance Execs Cheer Selection of Kamala Harris as Dem VP (LI)

With the prospect of longtime bank critic and progressive Sen. Elizabeth Warren being chosen as Joe Biden’s running mate now officially dead, Wall Street executives are openly applauding the presumptive Democratic nominee’s selection of California Sen. Kamala Harris as a signal that the top of the party’s ticket in November will be sufficiently “moderate” for their liking. Charles Myers, the founder of financial advisory firm Signum, told CNBC after Biden announced the California Democrat as his vice presidential pick that his “clients really wanted to know if Biden was going to stay in the center, and his pick of Harris reinforces that.” “While certain to generate excitement and to invite additional scrutiny of Harris’ record, we see this choice as a net positive for the Biden ticket,” Myers wrote in a note to clients late Tuesday.

“Harris, who generally could be called a centrist, will not push Biden to the left or the right on major policy issues. She will be supportive of Biden and the Democratic Party’s policy platform.” Other Wall Street executives echoed Myers’ assessment in interviews with CNBC, pointing to Harris’ experience as a senator and California Attorney General as well as her fundraising abilities. “I think it’s great,” said Marc Lasry, the CEO of investment firm Avenue Capital Group. “She’s going to help Joe immensely. He picked the perfect partner.” Ray McGuire of Citigroup and Blair Effron of investment firm Centerview Partners also hailed Biden’s choice of Harris as “great.” “She has a strong and active fundraising organization,” said Mike Kempner, founder of corporate public relations firm MWWPR.

“She will be an important and immediate addition to the Biden fundraising effort. She is a fundraising star. Her experience as a prosecutor makes her uniquely qualified to deliver the case against Trump.” Biden’s selection of Harris as his running mate comes months after Wall Street executives and other corporate donors warned the former vice president against picking Warren, a frequent and fierce critic of big banks and advocate for the interests of consumers. “She would be horrible,” one anonymous Wall Street executive and Democratic donor told CNBC in April. A longtime Biden fundraiser said “a lot of the donor base, on board and coming, would prefer almost anyone but Elizabeth.”= Veteran progressive organizer and radio host Jim Hightower suggested nothing about the choice of Harris should be surprising, but said the selection only makes more clear the road ahead for those wanting much bolder social change:

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A country ruled by two highly unpopular women among their own party, Kamala and Hillary. Why do it?

Hillary Clinton ‘Ready To Help’ In Biden Administration If Asked (NYP)

Hillary Clinton could be headed back to D.C. The former 2016 Democratic presidential candidate said she is “ready to help in any way I can” when asked if she would take a job in a Biden administration. “I’m ready to help in any way I can,” Clinton said at the 19th Represents Summit on Thursday. “Because I think this will be a moment where every American — I don’t care what party you are, I don’t care what age, race, gender, I don’t care — every American should want to fix our country … So if you’re asked to serve, you should certainly consider that.” Clinton previously served as Secretary of State under the Obama administration alongside Joe Biden, whom she formally endorsed for president in late April.


Clinton also spoke at the summit, which references the 19th Amendment granting women the right to vote, in defense of voting by mail for the November election. She criticized President Trump for implementing what she called a “hostile takeover” of the US Postal Service. Clinton added she fears Trump will use the mail service as part of a bid to cast doubt on election results should he lose. “I have every reason to believe that Trump is not going to go silently into the night if he loses,” Clinton said. “He’s going to try to confuse us. He’s going to try to bring all kinds of lawsuits.”

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The Dems live in their own little world.

Biden Accuser Tara Reade Slams Dems For Bill Clinton Convention Speech (NYP)

Why him? That’s what Tara Reade is demanding to know after learning Bill Clinton snagged a prime speaker’s slot at this week’s Democratic National Convention, calling the move “unconscionable.” Reade, who made headlines this year when she accused Joe Biden of shoving her against a wall and forcibly penetrating her with his fingers at a Capitol Hill office building in 1993, slammed party bigwigs for bringing in Bubba. “The Democratic National Committee has made it clear to survivors that they enable and they uphold institutionalized rape culture by allowing Bill Clinton to be a main speaker,” Reade told The Post. She added: “He has a history of sexual misconduct.”

So she wondered why DNC brass would put him on the big stage. “It is unconscionable that Bill Clinton is a main speaker, and this is coming from someone who voted for him. This is coming from a multi-generational Democrat.” Reade said she believes Clinton is a sexual predator. “This is based on talking to two of the survivors and also the court documents that have now been released because of Ghislaine Maxwell.” Clinton infamously palled around with Maxwell’s boss, Jeffrey Epstein. Giving Clinton a forum at the convention will set a “dangerous precedent,” Reade said. “They are holding up the MeToo movement as a shield for the sexual predators they are allowing in the Democratic establishment.”

She added: “I feel that hypocrisy, like sexual assault and sexual harassment, is an equal opportunity offender and it’s a nonpartisan issue. So I think the hypocrisy of the Democratic party is on full display by their speaker line-up for the Democratic national convention.” Biden has repeatedly said women who come forward with allegations of sexual assault should be believed, but he’s vehemently denied Reade’s accusation and said he doesn’t remember her working for him. The fallout from the scandal has left Reade “destitute,” she said. “After I came forward about Joe Biden, I lost everything, my work, my housing everything,” Reade said. “The weaponization of fear and shame to silence survivors has to stop.”

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“Many go to the platform precisely because it offers alternative and more diverse opinions to corporate-dominated radio, print and television. But YouTube is now funneling them back towards those same sources.”

“The emails, Clinton contends, swung the election from her to Trump. If this is the case, the decision to ban all discussion of them would have fundamentally altered the democratic process.”

Info On Wikileaks, “Hacked Information” Banned Under New YouTube Rules (MPN)

Social media giant YouTube announced yesterday a host of new measures it says are aimed at preventing any interference in the upcoming presidential elections. Chief among the list it wrote on its blog, is “removing content that contains hacked information, the disclosure of which may interfere with democratic processes, such as elections and censuses.” An example it gives, would be deleting “videos that contain hacked information about a political candidate.” It also promised to “raise up authoritative voices” when it comes to current events and politics by changing its algorithm to show users more credible channels and “reduce the spread of harmful misinformation and borderline content.” Example channels that produce authoritative content, it tells readers, includes Fox News and CNN. It also noted it would expand information panels underneath videos.

There are a number of reasons this new policy could concern users of its platform. Firstly, the great majority of leaked information — the lifeblood of investigative journalism — is anonymous. Often, like in the cases of Edward Snowden, Chelsea Manning or Reality Winner, whistleblowers face serious consequences if their names become attached to documents exposing government or corporate malfeasance. But without a name to go with a document, the difference between leaked data and hacked data is impossible to define. Thus, powerful people and organizations could claim data was hacked, rather than leaked, and simply block all discussion of the matter on the platform. Hearing the news, some feared already existing content from investigative journalists would be subject to removal under the new guidelines.

YouTube’s choice of Fox News and CNN as reliable sources might also raise eyebrows in some quarters. According to the latest Reuters Institute Digital News Report, fewer than half of all Americans trust the two networks (Fox at 42 percent and CNN at 47 percent). And a new study from Gallup/Knight Foundation finds that fewer than a third of the country has a favorable view of the media more generally, including only 19 percent of those under thirty (YouTube’s prime demographic). Many go to the platform precisely because it offers alternative and more diverse opinions to corporate-dominated radio, print and television. But YouTube is now funneling them back towards those same sources.

The 2016 presidential election was colored by Wikileaks’ release of the Podesta emails, discussion of which would be banned under YouTube’s new rules. The Hillary Clinton campaign alleges the emails were hacked from Podesta’s computer. The published communications, the authenticity of which is not in doubt, informed the country of the machinations of the Democratic Party, how it tipped the electoral scales in favor of Clinton and against Bernie Sanders in the primary, how Clinton stated to Wall Street that she had a “public” and a “private” position on regulation, insinuating she was lying to the nation, how representatives of Qatar wanted to meet with her husband Bill for “five minutes” to present him with a $1 million check for his birthday, and how her own staff held her in contempt. The emails, Clinton contends, swung the election from her to Trump. If this is the case, the decision to ban all discussion of them would have fundamentally altered the democratic process.

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Dream on.

PBOC: China’s Yuan Continues To Grow As An International Currency (SCMP)

China’s central bank said it expects more countries to accept the yuan for cross-border payments and settlements amid growing concerns about the country’s high exposure to the US dollar. In its annual report on the internationalisation of the yuan, which was released on Friday, the People’s Bank of China estimated “rapid and robust growth” this year despite the impact of the coronavirus pandemic. Such expansion would help to consolidate the growth momentum seen since the yuan was added to the IMF’s currency basket in 2015. “We expect more market participants will accept yuan as settlement and payment currency,” it said.

China is heavily exposed to the US-led Clearing House Interbank Payment System (CHIPS) and the Belgium-based Society for Worldwide Interbank Financial Telecommunication (SWIFT), which means it is vulnerable to US sanctions, such as those imposed on Iran and Russia. A total of 11 officials from mainland China and Hong Kong were put on a US sanctions list last week, as the rivalry between the world’s two largest economies continues to escalate. China’s state-owned banks with overseas operations could be the next targets if they are found to have business links to the sanctioned officials. The central bank report indicated rapid growth in the internationalisation of the yuan in recent years.

The total value of cross-border yuan payments and receipts by banks on behalf of clients rose 24.1 per cent year on year in 2019 to 19.67 trillion yuan (US$2.83 trillion). The value of global reserves of the yuan rose 1.95 per cent in the year to become the world’s fifth largest, while its share of the foreign exchange trading market was 4.3 per cent. The report also cited a survey conducted by Bank of China that said 69 per cent of the 3,300 foreign industrial and commercial companies polled planned to use or increase their use of the yuan. The yuan internationalisation index, released by Renmin University of China last month, rose 13 per cent last year to 3.03 and is forecast to rise to 5 in the first half of this year. But the currency still trails the US dollar at 50.85 and euro at 26.28.

The central bank said it would continue to remove barriers to cross-border use of the yuan, open up financial markets wider to foreign investors and promote the development of offshore yuan markets. The report highlighted countries involved in China’s Belt and Road Initiative, domestic free-trade zones and the Guangdong-Hong Kong-Macau Greater Bay Area as having the most potential for growth. It also forecast the rapid expansion of China’s Cross-border Interbank Payment System, which was launched in 2015 and is now used in nearly 100 countries. In 2019, it handled 1.9 million cross-border yuan transactions – an increase of 31 per cent from 2018 – while the total amount involved rose 28 per cent to 33.9 trillion yuan.

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Andreas Feininger Production B-17 heavy bomber 1942

 

Syria and Russia Accuse Israel Of Missile Attack On Syrian Regime Airbase (G.)
Stocks To Retest Correction Lows As Easy Money Disappears – Boockvar (CNBC)
Albert Edwards On The Next Recession: S&P Below 666 (ZH)
Bad Omen for Markets From First Signs of Yield Curve Inversion
Trump’s Trade War Threatens Central Bank ‘Put’ – Deutsche (BBG)
China Is Studying Yuan Devaluation as a Tool in Trade Spat (BBG)
YouTube Illegally Collects Data On Children – Child Protection Groups (G.)
Number Of UK Buy-to-Let Landlords Reaches Record High (Ind.)
Public Backs Fresh Referendum On ‘Final Say’ On Terms Of Brexit Deal (Ind.)
Murderers & Thieves Sold Out America – Gerald Celente (USAW)
Shell Predicted Dangers Of Fossil Fuels And Climate Change In 1980s (Ind.)
Indigenous People Are Being Displaced Again – By Gentrification (Latimore)
Fish Populations In Great Barrier Reef Collapse After Bleaching Events (Ind.)

 

 

I don’t want TAE to be about warfare, but this situation is getting so absurd it’s starting to feel dangerous. Don’t believe the narrative.

Syria and Russia Accuse Israel Of Missile Attack On Syrian Regime Airbase (G.)

Israeli war planes have bombed a Syrian regime airbase east of the city of Homs, the Russian and Syrian military have said. The Russian military said that two Israeli F-15 war planes carried out the strikes from Lebanese air space, and that Syrian air defence systems shot down five of eight missiles fired. Asked about the Russian statement, an Israeli military spokesman said he had no immediate comment. Syrian state TV reported loud explosions near the T-4 airfield in the desert east of Homs in the early hours of Monday. State TV initially reported that the attack was “most likely” American, a claim the Pentagon has denied.

Video footage on social media in Lebanon showed aircraft or missiles flying low over the country, apparently heading east towards Syria. At least 14 people, mostly Iranians or members of Iran-backed groups, were killed, the UK-based Syrian Observatory for Human Rights monitoring group said. Donald Trump warned on Sunday that the regime and its backers would pay a “high price” for the use of chemical weapons in the attack on rebel-held Douma that killed 42 people, but the Pentagon denied US forces were involved in Monday’s strikes. “However, we continue to closely watch the situation and support the ongoing diplomatic efforts to hold those who use chemical weapons, in Syria and otherwise, accountable,” a Pentagon spokesman said.

Separately, the White House put out an account of a telephone conversation between Trump and Emmanuel Macron, in which the US and French presidents “agreed to exchange information on the nature of the attacks and coordinate a strong, joint response”. Macron has said chemical weapons attacks in Syria would cross a “red line” for France and that French forces would strike if the regime was proven to have been involved. However, the French army denied responsibility for Monday’s attack.

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When the easy money goes, everything follows.

Stocks To Retest Correction Lows As Easy Money Disappears – Boockvar (CNBC)

He’s a Wall Street bear who sees more monster market moves coming — with the majority of them leaving stocks deep in the red. The Bleakley Advisory Group’s Peter Boockvar warns there’s more trouble brewing, because the era of easy money is ending, thanks to global central banks hiking borrowing costs. And as fears intensify over a trade war, Boockvar expects a solution to the tariff issue will eventually come at the expense of rising rates. “We could get that resumption of higher interest rates which would then concern the markets, and then retest the [S&P 500 Index] 2500-ish type lows,” the firm’s chief investment officer told CNBC’s “Futures Now” last week.

“We’re late cycle in the market. We’re late cycle in the economy, and you have an intensification in a tightening of monetary policy,” he said. Boockvar, a CNBC contributor, blamed the end of quantitative easing in the United States and Europe for increasing sell-off risks. “We’re a step closer to them wanting to take away negative interest rates. But there are still trillions of dollars of global bonds that have negative yielding rates,” he added. “So, it’s this rate environment that I think is becoming more of a headwind. That really is my main concern.” He doesn’t believe the situation will abate any time soon. Boockvar contended the 10-Year Treasury yield will push back toward 3 percent — preventing the S&P 500 from cracking above its Jan. 26 record high anytime soon.

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Barron’s interview with Albert Edwards via ZH, who add a little David Rosenberg intro:

Albert Edwards On The Next Recession: S&P Below 666 (ZH)

The Fed generally tightens rates until something breaks. David Rosenberg points out that since 1950 there have been 13 Fed tightening cycles, and 10 of them ended in recession (while the others have often ended in emerging market blow-ups, like the 1994 Mexican peso crisis). Surging delinquency and charge-off rates for smaller banks suggest the breaking point for the economy may come sooner than the Fed and bulls expect.

What happens to stocks during the next recession? The Federal Reserve managed to short-circuit this derating process. In 2011, when quantitative easing, or QE, really kicked in, equity re-engaged with bond yields and P/Es expanded. Like an artificial stimulant, QE inflated all asset prices away from fundamental value and from where they would otherwise have gone. We haven’t seen the lows in bond yields. In the next recession, bond yields in the U.S. will go negative and converge with those in Germany and Japan. The forward U.S. P/E bottomed at about 10.5 times in March 2009 on trough earnings. That was lower than the previous recession.

In the next recession, I would expect the P/E to bottom at about seven times, a lower low with earnings about 30% lower because of the recession. That would put the S&P lower than the 666 low of the previous crash, versus 2671 Thursday afternoon. If a recession unfolds, easy monetary policy won’t stop the market from collapsing. It will play itself out.

When will the recession hit: The Conference Board’s leading indicators look OK for now. What’s different is that problems in the real economy aren’t being reflected in the stock and bond markets. What we may see is the reverse: The stock market and parts of the credit markets collapse and cause problems in the real economy. If confidence collapses because the equity market collapses, then a recession unfolds.

Will the US be hit harder than Japan and Europe in the next bear market? It should be. Traditionally, if the U.S. goes down 20%, the German Dax, though it is cheaper, would tend to go down a little more. Maybe this time it won’t. Japan is the one market we do like now on a long-term basis, and one of the reasons is the buildup of U.S. corporate debt during these past few years. The big bubble is U.S. corporate debt. In contrast, Japan’s corporate debt is collapsing. Over half of its companies have more cash than debt. When the Fed buys U.S. Treasuries, it pulls down all yields. There has been demand for yield, so investors look at corporate bonds as an alternative. Companies have been very keen to issue them, and they have used the money to buy back stock or as a way to enrich management. This is the way QE has washed through the system here.

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“..rising expectations of a Fed policy mistake.. We could argue that mistake is 10 years old by now.

Bad Omen for Markets From First Signs of Yield Curve Inversion

The forward curve of a closely watched proxy for the Federal Reserve’s policy rate has slightly inverted, signaling investors are either pricing in a mistake from central bankers or end-of-cycle dynamics, according to JPMorgan Chase. The inversion of the one-month U.S. overnight indexed swap rate implies some expectation of a lower Fed policy rate after the first quarter of 2020, the bank’s strategists including Nikolaos Panigirtzoglou, wrote in a note Friday. “An inversion at the front end of the U.S. curve is a significant market development, not least because it occurs rather rarely,” they said. “It is also generally perceived as a bad omen for risky markets.”

The negative market signal comes as investors grapple with higher short term borrowing costs, which have risen in the U.S. to levels unseen since the financial crisis. While the strategists admit it is difficult to discern which of the two explanations for the curve inversion carries more weight, flow data suggests it is more likely to be rising expectations of a Fed policy mistake.

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No, Bloomberg, we know that China can’t dump Treasuries. The “end of Chimerica” sounds poetic though.

Trump’s Trade War Threatens Central Bank ‘Put’ – Deutsche (BBG)

A breakdown in the relationship between dollar weakness and Asian central bank intervention poses a risk to Treasuries, stocks and all risky assets, according to Deutsche Bank. Attempts by the Trump administration to clamp down on currency manipulation have limited the ability of central banks across the region to buy U.S. assets when the dollar weakens, and dampen the appreciation of their currencies, strategist Alan Ruskin write in a note Friday. These purchases have historically limited the greenback’s downside and acted as a “put” on Treasury market weakness, he wrote. Such central bank puts are usually associated with successive Federal Reserve chairs willing to support the wider market with loose monetary policy.

While such puts have been a continuous focus for investors, markets now risk overlooking other sources of central bank support that may be slipping as the U.S.’s “synergistic relationship with China,” comes to an end, according to Ruskin. “It is not a coincidence that in this recent period of dollar weakness, Treasury bonds were also soft,” he said. “Historically, foreign central banks of sizable current account surplus countries like China, Taiwan, Korea and Thailand would have been intervening.” According to the strategist, the “end of Chimerica” means American current account deficits are no longer financed to the same degree by Asian central bank reserve recycling of corresponding trade surpluses. That reduction in demand for Treasuries from foreign reserves is coming at a time when U.S. fiscal supply is set to increase dramatically, putting extra pressure on the country’s bond market.

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This is more likely. Risky for China though, but there must be plans to shore up domestic firms.

China Is Studying Yuan Devaluation as a Tool in Trade Spat (BBG)

China is evaluating the potential impact of a gradual yuan depreciation, people familiar with the matter said, as the country’s leaders weigh their options in a trade spat with U.S. President Donald Trump that has roiled financial markets worldwide. Senior Chinese officials are studying a two-pronged analysis of the yuan that was prepared by the government, the people said. One part of the analysis looks at the effect of using the currency as a tool in trade negotiations with the U.S., while a second part examines what would happen if China depreciates the yuan to offset the impact of any trade deal that curbs exports. The analysis doesn’t mean officials will carry out a devaluation, which would require approval from top leaders, the people said.

The yuan erased early gains on Monday, weakening 0.1 percent to 6.3110 per dollar in onshore trading at 3:32 p.m. local time. While Trump regularly bashed China on the campaign trail for keeping its currency artificially weak, the yuan has gained about 9 percent against the greenback since he took office as China’s economic growth stabilized, the government clamped down on capital outflows and fears of a credit crisis receded. The Chinese currency touched the strongest level since August 2015 last month and has remained steady in recent weeks despite an escalation of trade tensions between the world’s two largest economies.

While a weaker yuan could help President Xi Jinping shore up China’s export industries in the event of widespread tariffs in the U.S., a devaluation comes with plenty of risks. It would make it easier for Trump to follow through on his threat to brand China a currency manipulator, make it more difficult for Chinese companies to service their mountain of offshore debt, and undermine recent efforts by the government to move toward a more market-oriented exchange rate system. It would also expose China to the risk of local financial-market volatility, something authorities have worked hard to subdue in recent years.

When China unexpectedly devalued the yuan by about 2 percent in August 2015, the move sent shock-waves through global markets. “Is it in their interest to devalue yuan? It’s probably unwise,” said Kevin Lai, chief economist for Asia ex-Japan at Daiwa Capital Markets Hong Kong Ltd. “Because if they use devaluation as a weapon, it could hurt China more than the U.S. The currency stability has helped to create a macro stability. If that’s gone, it could destabilize markets, and things would look like 2015 again.”

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No really, it’s everywhere. What they can do, they will.

YouTube Illegally Collects Data On Children – Child Protection Groups (G.)

A coalition of 23 child advocacy, consumer and privacy groups have filed a complaint with the US Federal Trade Commission alleging that Google is violating child protection laws by collecting personal data of and advertising to those aged under 13. The group, which includes the Campaign for a Commercial-Free Childhood (CCFC), the Center for Digital Democracy and 21 other organisations, alleges that despite Google claiming that YouTube is only for those aged 13 and above, it knows that children under that age use the site. The group states that Google collects personal information on children under 13 such as location, device identifiers and phone numbers and tracks them across different websites and services without first gaining parental consent as required by the US Children’s Online Privacy Protection Act (Coppa).

The coalition urges the FTC to investigate and sanction Google for its alleged violations. “For years, Google has abdicated its responsibility to kids and families by disingenuously claiming YouTube — a site rife with popular cartoons, nursery rhymes, and toy ads — is not for children under 13,” said Josh Golin, executive director of the CCFC. “Google profits immensely by delivering ads to kids and must comply with Coppa. It’s time for the FTC to hold Google accountable for its illegal data collection and advertising practices.”

The group claims that YouTube is the most popular online platform for children in the US, used by about 80% of children aged six to 12 years old. Google has a dedicated app for children called YouTube Kids that was released in 2015 and is designed to show appropriate content and ads to children. It also recently took action to hire thousands of moderators to review content on the wider YouTube after widespread criticism that it allows violent and offensive content to flourish, including disturrbing children’s content and child abuse videos.

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Bizarro housing.

Number Of UK Buy-to-Let Landlords Reaches Record High (Ind.)

The number of buy-to-let investors in the UK rose to a record high of 2.5 million in the latest tax year, new research shows. The increase of 5% on the previous year comes despite the introduction of a host of extra taxes and regulations on the sector. In recent years, the government has brought in a 3% Stamp Duty levy, new stress tests for home loans, and ended mortgage interest tax relief. The number of landlords has increased 27% in the past five years, up from 1.97 million in 2011-12, research by London-focused estate agent Ludlow Thompson found.

Landlords now own an average of 1.8 buy-to-let properties each – a figure that has risen for the fifth consecutive year. The data suggests that landlords continue to see residential property, especially in London, as a strong investment, despite signs that house price growth has stalled or even gone into reverse in some areas in the last year. Investors have seen annual returns of almost 10% since 2000, Ludlow Thompson said. Chairman Stephen Ludlow said the rising number of landlords shows the enduring appeal of investing in buy-to-let. “The long-term picture for the buy-to-let market remains strong,” he said.

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No chance of a second vote for now. But that may change yet.

Public Backs Fresh Referendum On ‘Final Say’ On Terms Of Brexit Deal (Ind.)

Support is growing for a fresh referendum on the final Brexit deal, according to a new poll showing the public back the idea for the first time. The survey found that 44% of people want a vote on the exit terms secured by Theresa May, amid continued uncertainty over the withdrawal agreement. That is a clear eight points ahead of the 36% who reject a further referendum, the research conducted for the anti-Brexit Best for Britain group showed. The group pointed to evidence that “Brexit is sharpening the British public’s minds” and called for MPs to respond to the people’s growing desire for a “final say”.

The referendum would be held on the details of the deal the prime minister must strike by the autumn – on both the planned transition period and a “framework” for a permanent trade and security relationship. Eloise Todd, Best for Britain’s chief executive, said voters should be allowed to choose between the details of the future on offer outside the EU, or staying inside the bloc. “Now there is a decisive majority in favour of a final say for the people of our country on the terms of Brexit. This poll is a turning point moment,” she said. “The only democratic way to finish this process is to make sure the people of this country – not MPs across Europe – have the final say, giving them an informed choice on the two options available to them: the deal the government brings back and our current terms.

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Celente rants are always good.

Murderers & Thieves Sold Out America – Gerald Celente (USAW)

Renowned trends researcher Gerald Celente says the trade war President Trump is starting against China must be fought for America to survive. Celente explains, “We have lost 3.5 million jobs (to China). Some 70,000 manufacturing plants have closed. Why would anybody be fighting Trump to do a reversal of us being in a merchandise trade deficit of $365 billion? Tell me any two people that would do business with each other and one side takes a huge loss and keeps taking it. . . So, why would people argue and fight and bring down the markets because Trump wants to bring back jobs and readjust a trade deficit that, by any standard, is destroying the nation?” Who’s to blame for the lopsided trade deficits destroying the middle class of America?

Look no further than the politicians and corporations buying them off. Celente charges, “They sold us out. The European companies and the American companies sold us out, and the people fighting Trump are also the big retailers because they’ve got their slave labor making their stuff over there. They bring it back here and mark up the price, and they make more money. If they have to pay our people to do that work, they have to pay them a living wage and they can’t make enough profit. That’s who is fighting us. . You go back to our top trend in 2017, and it was China was going to be the leader in AI (artificial intelligence) now and beyond, and that is exactly what happened. All the corporations have sold us out. . . .The murderers and the thieves sold out America.”

Celente thinks the odds are there will not be a financial crash in 2018 “because they are repatriating all that dough from overseas at a very low tax rate and because of the tax cuts from 35% to 21%. These are the facts. In the first three months of this year, there have been more stock buybacks and mergers and acquisitions activity than ever before in this short period of time because of all that cheap money going back into the corporations. That’s what’s keeping the markets up.”

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Shell’s political power will shield it.

Shell Predicted Dangers Of Fossil Fuels And Climate Change In 1980s (Ind.)

Oil giant Shell was aware of the consequences of climate change, and the role fossil fuels were playing in it, as far back as 1988, documents unearthed by a Dutch news organisation have revealed. They include a calculation that the oil company’s products alone were responsible for 4% of total global carbon emissions in 1984. They also predict that changes to sea levels and weather would be “larger than any that have occurred over the past 12,000 years”. As a result, the documents foresee impacts on living standards, food supplies and other major social, political and economic consequences.

In The Greenhouse Effect, a 1988 internal report by Shell scientists, the authors warned that “by the time the global warming becomes detectable it could be too late to take effective countermeasures to reduce the effects or even to stabilise the situation”. They also acknowledged that many experts predicted an increase in global temperature would be detectable by the end of the century. They went on to state that a “forward-looking approach by the energy industry is clearly desirable”, adding: “With the very long time scales involved, it would be tempting for society to wait until then before doing anything. “The potential implications for the world are, however, so large that policy options need to be considered much earlier. And the energy industry needs to consider how it should play its part.”

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Money trumps history.

Indigenous People Are Being Displaced Again – By Gentrification (Latimore)

It is symptomatic of the colonial-settler prerogative that has sought to eliminate the offensive presence of the natives from any profitable territory. In 21st-century Australia, the “dispersal” that began with European invasion continues through the gentrification of city suburbs where Indigenous identities persist. In the colonial argot of the 19th century, dispersal euphemistically described a bloody practice of massacre and forced dispossession of First Nations peoples, often performed as punishment for perceived theft, or any other form of resistance to the colonisers more generally. In the early and mid-20th century, blackfullas were forcibly coerced into government reserves most commonly known as “missions”.

The overarching intent of these “protection” policies was to ensure the dissolution of First Nations culture and traditional governance structures, pushing mob to develop from “their former primitive state to the standards of the white man”, as the Aboriginal Protection Board said in 1935. When the missions began to be disbanded after the second world war, it forced significant Indigenous migration from the bush to towns and cities, where we repopulated places like Fitzroy, Brisbane’s West End and particularly Redfern in great numbers. This 1950s policy of “assimilation” was essentially a state-sanctioned experiment to force Indigenous people to give up their beliefs and traditions as they adapted to urban life.

[..] Yet the place of blackfullas in Australia’s cities is under threat. Faced with rapid gentrification and associated rental and ownership price hikes, urban Indigenous populations continue to relocate to the outer suburbs, where cheaper housing is usually located. The trend could be viewed as a contemporary iteration of the dispersals of the past – decidedly less bloody, though equally impelled by capitalistic imperatives.

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Logic.

Fish Populations In Great Barrier Reef Collapse After Bleaching Events (Ind.)

The coral bleaching events that have devastated the Great Barrier Reef in recent years have also taken their toll on the region’s fish population, according to a new study. While rising temperatures on the reef killed nearly all the coral in some sections, the effects on the wider marine community have been less clear. Now, scientists have begun to establish the long-term effects of bleaching events on the Great Barrier Reef’s fish population. This work is essential for researchers trying to understand what will happen to coral reef ecosystems as global warming makes mass bleaching events more frequent. “The widespread impacts of heat stress on corals have been the subject of much discussion both within and outside the research community,” said PhD student Laura Richardson of the ARC Centre of Excellence for Coral Reef Studies.

“We are learning that some corals are more sensitive to heat stress than others, but reef fishes also vary in their response to these disturbances.” Ms Richardson and her collaborators studied reefs in the northern section of the Great Barrier Reef, where around two-thirds of corals were killed in the 2016 bleaching event that followed a global heatwave. The researchers found there were “winners” and “losers” among the fish species on the reef, but overall there was a significant decline in the variety of species following bleaching. Their results were published in the journal Global Change Biology. “Prior to the 2016 mass bleaching event, we observed significant variation in the number of fish species, total fish abundance and functional diversity among different fish communities,” said co-author Dr Andrew Hoey.

“Six months after the bleaching event, however, this variation was almost entirely lost.” Predictably, the scientists noted that fish with intimate associations with corals suffered severe losses. Butterflyfish, which feed on corals, faced the steepest declines. In response to the looming threat of coral bleaching, scientists have called for “radical interventions” to save the world’s reefs. Some have suggested that more than 90% of corals could die by 2050 at the current rate of global warming.

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Aug 282017
 
 August 28, 2017  Posted by at 9:01 am Finance Tagged with: , , , , , , , , ,  5 Responses »


Lou Reed New York City 1966

 

Harvey’s Cost Reaches Catastrophe: Only 15% Of Homes Have Flood Insurance (BBG)
Gasoline Surges, Oil Holds Near $48 as Harvey Shuts Refineries (BBG)
Mammoth Flood Disaster in Houston: More Rain Yet to Come (WU)
The Coming Collapse Of China’s Ponzi Scheme Economy (SCMP)
What’s Driving The Growth In US ‘Shadow Banking’ (CBR)
Volatility Makes a Comeback (Rickards)
YouTube “Economically Censors” Ron Paul (ZH)
Should The Rich Be Taxed More? (G.)
The West’s Wealth Is Based On Slavery. Reparations Should Be Paid (G.)
Danone Sends 5,000 Cows to Siberia in Quest for Cheaper Milk (BBG)

 

 

The real tragedy takes place below the surface. Sort of literally. Much more rain to come.

Harvey’s Cost Reaches Catastrophe: Only 15% Of Homes Have Flood Insurance (BBG)

Hurricane Harvey’s second act across southern Texas is turning into an economic catastrophe – with damages likely to stretch into tens of billions of dollars and an unusually large share of victims lacking adequate insurance, according to early estimates. Harvey’s cost could mount to $24 billion when including the impact of relentless flooding on the labor force, power grid, transportation and other elements that support the region’s energy sector, Chuck Watson, a disaster modeler with Enki Research, said by phone on Sunday. That would place it among the top eight hurricanes to ever strike the U.S. “A historic event is currently unfolding in Texas,” Aon wrote in an alert to clients. “It will take weeks until the full scope and magnitude of the damage is realized,” and already it’s clear that “an abnormally high portion of economic damage caused by flooding will not be covered,” the insurance broker said.

[..] Most people with flood insurance buy policies backed by the federal government’s National Flood Insurance Program. As of April, less than one-sixth of homes in Houston’s Harris County had federal coverage, according to Aon. That would leave more than 1 million homes unprotected in the county. Coverage rates are similar in neighboring areas. Many cars also will be totaled. “A lot of these people are going to be in very serious financial situations,” said Loretta Worters, a spokeswoman for the Insurance Information Institute. “Most people who are living in these areas do not have flood insurance. They may be able to collect some grants from the government, but there are not a lot, usually they’re very limited. There are no-interest to low-interest loans, but you have to pay them back.”

The federal program itself is already struggling with $25 billion of debt. The existing program is set to expire on Sept. 30 and is up for review in Congress, which ends its recess Sept. 5. Costs still will likely soar for insurance companies and their reinsurers, biting into earnings. As Harvey bore down on the coastline Friday, William Blair, a securities firm that tracks the industry, said the storm could theoretically inflict $25 billion of insured losses if it landed as a “large category 3 hurricane.” Policyholder-owned State Farm Mutual Automobile Insurance has the largest share in the market for home coverage in Texas, followed by Allstate, which is publicly traded. William Blair estimated that, in that scenario, Allstate could incur $500 million of pretax catastrophe losses, shaving 89 cents off of earnings per share.

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Most shutdowns so far are precautionary. But…

Gasoline Surges, Oil Holds Near $48 as Harvey Shuts Refineries (BBG)

Gasoline surged to the highest in two years and oil was steady as flooding from Tropical Storm Harvey inundated refining centers along the Texas coast, shutting more than 10% of U.S. fuel-making capacity. Motor fuel prices rose as much as 6.8%, while oil held gains near $48 a barrel. Harvey, the strongest storm to hit the U.S. since 2004, made landfall as a hurricane Friday, flooding cities and shutting plants able to process some 2.26 million barrels of oil a day. Pipelines were closed, potentially stranding some crude in West Texas and starving New York Harbor of gasoline. Gasoline prices are going to continue to rise this week as we expect another three days of rain in the Houston area,” Andy Lipow, president of consultant Lipow Oil in Houston, said by phone.

“With pipeline operators beginning to shut down their crude oil and refined product infrastructure, I expect to see further curtailment of refinery operations. A spike in gasoline and diesel prices will drag up crude oil prices.” Oil has traded this month in the tightest range since February as investors weigh rising global supply against output cuts by members of OPEC and its allies. As Harvey led to widespread flooding, Shell shut its Deer Park plant, while Magellan Midstream suspended its inbound and outbound refined products and crude pipeline transportation services in the Houston area. Gasoline for September delivery climbed as much as 11.33 cents to $1.7799 a gallon on the New York Mercantile Exchange, the highest intraday price for a front-month contract since July 2015.

It traded at $1.7621 at 12:36 p.m. in Hong Kong. West Texas Intermediate oil for October delivery fell 16 cents to $47.71 a barrel after advancing 0.9% on Friday. Brent crude’s premium to WTI widened to the largest in two years with the global benchmark trading at as much as $4.96 above the U.S. marker. Brent for October settlement gained 18 cents, or 0.3%, to $52.59 a barrel on the London-based ICE Futures Europe exchange.

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Waether Underground is probably the best source.

Mammoth Flood Disaster in Houston: More Rain Yet to Come (WU)

Harvey’s winds are expected to remain modest, and it could become a tropical depression at any point, but winds are not the problem here. The NOAA/NWS National Hurricane Center now predicts that Harvey will inch its way into the Gulf of Mexico—though just barely—by Monday night, then arc northeast and make a second landfall just west of Houston on Wednesday. The 12Z GFS and 00Z European model runs agree on a general northward motion for Harvey across eastern Texas, beginning around midweek. At this point it may make little difference whether Harvey stays just inland or moves just offshore, since rainbands would continue to be funneled toward Houston either way. The fine-scale particulars of this outlook may shift over time, but the overall message is consistent: Harvey will be a devastating rainmaking presence in southeast Texas for days to come.

Harvey’s circulation is located in a near-ideal spot for funneling vast amounts of moisture from the Gulf of Mexico toward the upper Texas coast. Here, converging winds at low levels have been concentrating the moisture into north-south-oriented bands of intense thunderstorms with torrential rain. Since Harvey is barely moving, these bands are creeping only slowly eastward as individual cells race north along them—a “training” set-up that is common in major flood events. Mesoscale models, our best guidance for short-term, small-scale behavior of thunderstorms, show little sign of relief for southeast Texas anytime soon. Convection-resolving mesoscale models, which have a tight enough resolution to depict individual thunderstorms, are an invaluable tool in situations like this. The mesoscale nested NAM model predicts that 20” – 30” of additional rainfall is likely through Tuesday across the Houston metro area, with even larger totals at some points.

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Hmm. But what if China manages to unload all its overcapacity on the Belt Road, and makes other countries pay?

The Coming Collapse Of China’s Ponzi Scheme Economy (SCMP)

Friends who have a greater interest than I do in reading the tea leaves in Beijing tell me that the emphasis in relations with Hong Kong from now on will be on one country rather than two systems. I think this phrases things the wrong way. The one country bit was never in issue. What they actually mean to say is that Beijing’s system of state command of the economy will become dominant and Hong Kong’s more freewheeling system will fade away. I don’t think it will happen. In my view human society is so dynamic that no command system can last long in charge of an economy. Attempts at this particular form of hubris inevitably end in either war or financial crisis. For the Soviet Union it was financial crisis. I think the same fate awaits Beijing.

Consider crude steel production, a test-tube example of how command economies get it wrong. In the mainland this stood in June at an all time monthly record of 73 million tonnes, five times the total production in all of Europe. Steel was recently targeted for a reduction in capacity but then a regime of easy money intended to help the industry overcome a difficult period of contraction instead stimulated production. It has happened across the mainland’s rust belt industries. Why is so much steel needed? Simple. It is needed to build more steel mills so as to build more shipyards, ports, railways and bridges so that more ships can be built to carry more iron ore to more ports and thence along more rails and bridges to more steel mills so as to build more shipyards, ports, railways …

What we have here, in short, is a giant Ponzi scheme. In a Ponzi scheme you pay out the winnings of the first entrants with what others later pay into it. As long as it keeps growing everything is fine. When it stops growing it collapses. In this case you justify production with demand based purely on more production. As long as you keep pushing production up everything looks fine. At its peak in 2014 China turned out 30 times more cement than the United States, and the latest production figures are only a smidgen less than 2014’s.

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What do you think? A good sign? It isn’t in China….

What’s Driving The Growth In US ‘Shadow Banking’ (CBR)

In the wake of the 2007–10 financial crisis, there’s been sizeable growth of “shadow banking”— companies without banking charters entering lines of business traditionally associated with deposit-taking banks. Hedge funds that make direct loans to midsize businesses, online mortgage originators, peer-to-peer lending platforms, and payday lenders have all been on the rise. What’s behind this? According to Chicago Booth’s Gregor Matvos, Booth PhD candidate Greg Buchak, Columbia’s Tomasz Piskorski, and Stanford’s Amit Seru, much of the growth is due to regulations that have pushed banks out of traditional lending businesses. The researchers also attribute some growth to online technology that has lowered the barrier to entry in markets where lenders once needed networks of physical branches to have any hope of building business.

The researchers focus on the US residential lending market, the largest consumer loan market in the country—and the market that drew the most attention from regulators after 2008. Between 2007 and 2015, shadow banks nearly tripled their market share, from 14% to 38%. They gained the most in the Federal Housing Administration (FHA) mortgage market, which serves lower-quality borrowers and is where shadow banks’ share rose from 20% to 75%. Traditional banks retreated from sectors of the mortgage market where the regulatory burden grew the most, the researchers note. Traditional banks have been particularly hindered by rules that increased monitoring of balance-sheet holdings and constrained what banks could hold in their own accounts.

Their retreat helped shadow banking succeed in the riskier FHA market and in more-traditional, conforming mortgages. The researchers also separated shadow banks into those that did and didn’t originate loans online. During the study period, lenders that originated loans online (fintech lenders) saw market share rise from 4% to 13%—but that remains less than half of the shadow-banking sector.

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Super spikes.

Volatility Makes a Comeback (Rickards)

Volatility has languished near all-time lows for months on end. That’s about to change. For almost a year, one of the most profitable trading strategies has been to sell volatility. Since the election of Donald Trump stocks have been a one-way bet. They almost always go up, and have hit record highs day after day. The strategy of selling volatility has been so profitable that promoters tout it to investors as a source of “steady, low-risk income.” Nothing could be further from the truth. Yes, sellers of volatility have made steady profits the past year. But the strategy is extremely risky and you could lose all of your profits in a single bad day. Think of this strategy as betting your life’s savings on red at a roulette table. If the wheel comes up red, you double your money. But if you keep playing eventually the wheel will come up black and you’ll lose everything.

That’s what it’s like to sell volatility. It feels good for a while, but eventually a black swan appears like the black number on the roulette wheel, and the sellers get wiped out. I focus on the shocks and unexpected events that others don’t see. Right now looks like one of those highly favorable windows when the purchase of volatility is the right move. You could collect huge winnings as the short sellers scramble to cover their bets before they are wiped out completely. The chart below shows a 20-year history of volatility spikes. You can observe long periods of relatively low volatility such as 2004 to 2007, and 2013 to mid-2015, but these are inevitably followed by volatility super-spikes. During these super-spikes the sellers of volatility are crushed, sometimes to the point of bankruptcy because they can’t cover their bets.

The period from mid-2015 to late 2016 saw some brief volatility spikes associated with the Chinese devaluation (August and December 2015), Brexit (June 23, 2016) and the election of Donald Trump (Nov. 8, 2016). But, none of these spikes reached the super-spike levels of 2008 – 2012. In short, we have been on a volatility holiday. Volatility is historically low and has remained so for an unusually long period of time. The sellers of volatility have been collecting “steady income,” yet this is really just a winning streak at the volatility casino. The wheel of fortune is about to turn and luck is about to run out for the sellers. It will soon be time for the buyers of volatility to collect their winnings, big time.

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Sliding scales. One step before large tech is declared utility?!

YouTube “Economically Censors” Ron Paul (ZH)

Former US Congressman Ron Paul has joined a growing list of independent political journalists and commentators who’re being economically punished by YouTube despite producing videos that routinely receive hundreds of thousands of views. In a tweet published Saturday, Wikileaks founder Julian Assange tweeted a screenshot of Paul’s “Liberty Report” page showing that his videos had been labeled “not suitable” for all advertisers by YouTube’s content arbiters. Assange claims that Paul was being punished for speaking out about President Donald Trump’s decision to increase the number of US troops in Afghanistan, after Paul published a video on the subject earlier this week. The notion that YouTube would want to economically punish a former US Congressman for sharing his views on US foreign policy – a topic that he is unequivocally qualified to speak about – is absurd.

Furthermore, the “review requested” marking on one of Paul’s videos reveals that they were initially flagged by users before YouTube’s moderators confirmed that the videos were unsuitable for a broad audience. Other political commentators who’ve been censored by YouTube include Paul Joseph Watson and Tim Black – both ostensibly for sharing political views that differ from the mainstream neo-liberal ideology favored by the Silicon Valley elite. Last week, Google – another Alphabet Inc. company – briefly banned Salil Mehta, an adjunct professor at Columbia and Georgetown who teaches probability and data science, from using its service, freezing his accounts without providing an explanation. He was later allowed to return to the service. Conservative journalist Lauren Southern spoke out about YouTube’s drive to stifle politically divergent journalists and commentators during an interview with the Daily Caller.

“I think it would be insane to suggest there’s not an active effort to censor conservative and independent views,” said Southern. “Considering most of Silicon Valley participate in the censorship of alleged ‘hate speech,’ diversity hiring and inclusivity committees. Their entire model is based around a far left outline. There’s no merit hiring, there’s no support of free speech and there certainly is not an equal representation of political views at these companies.” Of course, Google isn’t the only Silicon Valley company that’s enamored with censorship. Facebook has promised to eradicate “fake news,” which, by its definition, includes political content that falls outside of the mainstream. Still, economically punishing a former US Congressman and medical doctor is a new low in Silicon Valley’s campaign to stamp out dissent.

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The most prosperous times of our societies coincide with the highest tax levels for the rich.

Should The Rich Be Taxed More? (G.)

The past four decades have been extremely kind to those at the top. They have seen their incomes grow faster than the rest of the population and hold a far bigger share of wealth in the form of property and financial investments than the rest of the population. Over the years a bigger slice of national income has gone to capital at the expense of labour, and the rich have been the beneficiaries of that, because they are more likely to own shares and expensive houses. The trend has been particularly strong in the US, where labour’s share of income has fallen from a recent peak of 57% at the end of Bill Clinton’s presidency to 53% by 2015. The Gini coefficient – a measure of inequality – has been steadily rising since 1970 and is now at levels normally seen in developing rather than advanced economies.

Hatgioannides, Karanassou and Sala seek to take account of these profound changes in the distribution of income and wealth. They do so by dividing the average income tax rate of a particular slice of the US population by the%age of national income commanded by that same group and by their share of wealth. They then look at whether by this measure – the fiscal inequality coefficient – the US tax system has become more or less progressive over time. The findings show quite clearly that it has become less progressive. In terms of income, the poorest 99% of the US population paid nine times as much income tax as the richest 1%, both when John F Kennedy was president in the early 1960s and when Ronald Reagan beat Jimmy Carter in the 1980 race for the White House. By 2014, they paid 21 times as much.

Similarly, the bottom 99.9% in the US paid 28 times as much tax as the elite 0.1% in the early 1960s and the early 1980s, but by 2014 they were paying 76 times as much. The same trend applies – although it is not pronounced – when income tax is divided by the share of wealth. The bottom 99% paid 22 times as much income tax as the wealthiest 1% in 1980 but were paying 47 times as much in 2014. The bottom 99.9% paid 58 times as much income tax as the top 0.1% before the onset of Reaganomics; by 2014 they were paying 175 times as much. [..] As the authors note, since 1980, economic policy making has been dominated by the idea that deregulation, less generous welfare and tax cuts will stimulate higher investment, higher productivity, higher growth and higher living standards for all. None of this has occurred and, what’s more, the social mobility in the decades after the second world war has been thrown into reverse. The great American dream – the notion that anybody can strike it rich – is dead.

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They won’t be.

The West’s Wealth Is Based On Slavery. Reparations Should Be Paid (G.)

Malcolm X explained that “if you stick a knife in my back nine inches and pull it out six inches, that’s not progress. If you pull it all the way out, that’s not progress. The progress comes from healing the wound that the blow made”. Instead of attempting to fix the damage, we are completely unable to progress on issues of equality because countries such as Britain “won’t even admit the knife is there”. It is the height of delusion to think that the impact of slavery ended with emancipation, or that empire was absolved by the charade of independence being bestowed on the former colonies.

[..]It is not just governments that owe a debt; some of the biggest institutions and corporations built their wealth on slavery. Lloyds of London is one of Britain’s most successful companies and its roots lie in insuring the merchant trade in the 17th century. The fact that this was the slave trade has already led to civil action being taken by African Americans in New York. The church, many of the biggest banks, much of the ironworks industry and port cities gorged themselves on the profits from human flesh. It is clear that it would be just to pay reparations, and it is also possible to calculate the amount that Britain and other nations owe. A lot of work has been done in the United States to determine the damages owed to African Americans. The figure owed comes to far more than the “forty acres and a mule” that were promised to some African Americans who fought in the civil war.

The latest calculations from researchers estimates that for unpaid labour, taking into account interest and inflation, African Americans are owed anywhere between $5.9tn and $14.2tn. It would not be prohibitively complicated to work out the debts owed by the western powers, or the companies that enriched themselves off exploitation. The obviousness of the issue is such that a federation of Caribbean countries (Caricom) is now demanding reparations, as is the Movement for Black Lives in America and Pan-Afrikan Reparations Coalition in Europe. In many ways the calls for reparatory justice do not take go far enough. Caricom includes a demand to cancel third world debt, and the Movement for Black Lives for free tuition for African Americans.

Both of these are examples of removing the knife from our backs, rather than healing the wound. Third world debt was an unjust mechanism for maintaining colonial economic control and; allowing free access to a deeply problematic school system will not eradicate the impacts of centuries of oppression. In order to have racial justice we need to hit the reset button and have the west account for the wealth stolen and devastation caused. Nothing short of a massive transfer of wealth from the developed to the underdeveloped world, and to the descendants of slavery and colonialism in the west, can heal the deep wounds inflicted.

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Cows to Qatar, cown to SIberia: the new backpackers?!

Danone Sends 5,000 Cows to Siberia in Quest for Cheaper Milk (BBG)

President Vladimir Putin’s ban on European Union cheese imports has driven up milk prices in Russia by so much that French yogurt maker Danone is transporting almost 5,000 cows to a farm in Siberia to ensure it has an affordable supply. The Holstein cows are traveling as many as 2,800 miles (4,500 kilometers) in trucks from the Netherlands and Germany, boosting the herd on a farm near the city of Tyumen, according to Charlie Cappetti, head of Danone’s Russian unit. That should protect the company from the increase in raw milk prices, which are up 14% this year, he said. “Milk prices have been going up steadily,” Cappetti said in an interview in Moscow. “That puts products such as yogurt under pressure.” While the French dairy company doesn’t normally invest in agriculture, it made an exception for Russia.

After Putin’s ban on dairy imports took hold in 2014, demand for milk surged as local cheesemakers rushed to replace French camembert and Italian pecorino. That has exacerbated the inflationary effects of the ruble’s weakness. Danone invested in the 60-hectare (150-acre) farm with local producer Damate, Cappetti said. The first cows started to provide milk for Danone in May, and a final shipment of cattle is due to arrive in September. “We hope that Russian milk inflation will slow down next year,” the executive said. The difference between supply and demand is narrowing as new milk is coming to the market, including from the Siberian farm. While easing milk inflation may help the Russian dairy market rebound in volume terms, Danone isn’t expecting a fast economic recovery in the country, according to Cappetti. Sales in Russia have been growing in line with inflation in the first half and should rise in 2018, he said.

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