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  • A New Financial System Is Being Born

    Authored by Mike Krieger via Liberty Blitzkrieg blog,

    If Bitcoin blew you away when you first discovered it, and continues to do so to this day, Spiral Dynamics can help explain why. Bitcoin was an expression in the physical world of the newly emergent leading-edge integral level consciousness. It drew lessons from history and attempted to take the best of orange and green worldviews and incorporate them into an entirely new form of money. We see the clear presence of free markets and individualism, as well as the intentional separation of the system from dominator hierarchies (bureaucratic government meddling), which had corrupted all money before it. Its greenness is evident in the fact that by design no individual or company controls the network. Global, decentralized, revolutionary technology. This is perhaps the perfect example of integral consciousness operating on our planet at this time from an economics standpoint, and why it has captured the imagination of so many, while at the same time being violently rejected by so many others.

     

    From February’s post: Why Increased Consciousness is the Only Path Forward

    Although I had heard about it much earlier, I didn’t truly start investigating Bitcoin until the summer of 2012. The more I learned the more my mind was blown away, and for a while I couldn’t think about anything else. What truly solidified its real world usefulness to me was when I discovered it had been used by Wikileaks to accept payments in the midst of a financial services blockade against the renegade publisher. This realization inspired my first Bitcoin related post in August 2012 titled, Bitcoin: A Way to Fight Back Against the Financial Terrorists? 

    In that piece, I linked to a Forbes article that detailed the revolutionary events taking place. We learned:

    Following a massive release of secret U.S. diplomatic cables in November 2010, donations to WikiLeaks were blocked by Bank of America, VISA, MasterCard, PayPal and Western Union on December 7th, 2010. Although private companies certainly have a right to select which transactions to process or not, the political environment produced less than a fair and objective decision. It was coordinated pressure exerted in a politicized climate by the U.S. government and it won’t be the last time that we see this type of pressure.

     

    Fortunately, there is way around this and other financial blockades with a global payment method immune to political pressure and monetary censorship.

     

    On its public bitcoin address, Wikileaks has taken in over $32,000 equivalent in more than 1,100 separate bitcoin donations throughout the blockade (1BTC = $10.00). But these amounts may be significantly higher, because it does not even include the individually-generated bitcoin addresses that WikiLeaks provides for donors upon request.

    I knew right then and there that Bitcoin had the potential to change the world. My passion for Bitcoin was always framed by my ten years working in the financial industry. Many of us who lived through the 2008 crisis knew the financial system was dead. We knew it was corrupt, archaic and terminal, so many of us began bracing for what might come next. We did what we thought made sense at the time, which included buying precious metals like gold and silver given their historic track record of protecting wealth in periods of paradigm-shifting financial disruption. Others took more extreme measures to protect themselves from the end of the financial system, but a small group forward thinking geeks decided to do something much better. They decided to build an alternative.

    Thus, Bitcoin was born and early adopters in the field of technology immediately began to build on top of it. As soon as I realized what was happening much of the “doom and gloom” that had enveloped my thinking began to lift. I now knew that even if the financial system crashed and burned tomorrow, the early stages of a new and far more honest financial system were already in place. The emergence of Bitcoin literally changed my life for the better as it allowed me to emerge from a cave of gloom and become optimistic about our long-term future. While I knew the path would be long and hard since the current entrenched interests wouldn’t give up without a fight, I could see a very bright light at the end of the tunnel, and the continued development in this space has been extraordinary to watch ever since.

    The global financial system as it stands completely archaic and corrupt. It enriches the wrong types of people for the wrong sort of behavior, and is entirely extractive and parasitic by design.  If there’s sector in the economy that needs a total redesign and reboot for the sake of humanity, it’s the financial system.

    Being involved in the crypto world for the past five years has been a breath of fresh air and a shot of adrenaline to my system. Traditional markets are a rigged snooze-fest by comparison, grotesque financial Potemkin villages designed to make overly indebted, predatory economies look good. What I find so fascinating about the current environment is that many of the dreams we all read about in the very early days of Bitcoin are starting to be implemented and designed, slowly but surely. For those of you who still have a difficult time conceptualizing exactly what’s happening in the space, I think the following tweet may help.

    //platform.twitter.com/widgets.js

    On that note, I want to talk about more than just Bitcoin, which I see as the reserve currency of the crypto world. Beyond Bitcoin, a lot of the buzz in the space right now revolves around a burgeoning phenomenon known as ICOs, or Initial Coin Offerings. So what are ICOs?

    Yesterday, TechCrunch published an interesting piece on the topic. Here are a few keys points:  

    Because this editor was still confused (I’m not proud), I talked yesterday with Stan Miroshnik, a UC Berkeley grad with an MBA from MIT who today runs L.A.-based Argon Group, one of the first digital finance-focused investment banks. Miroshnik nicely answered an array of questions about ICOs, including how these things get staged, how companies establish a value for their offerings, and more. If you’re still trying to get a handle of this latest investing trend, too, read on.

     

    TC: ICOs are everywhere suddenly.  When was the first ICO staged?

     

    SM:  You have to go back to around 2013, when Mastercoin, a protocol on top the bitcoin blockchain, raised $500,000. Then you had a number of other milestone token sales, such as Ethereum in 2014, then the DAO, or Decentralized Autonomous Organization, which was built on the Ethereum blockchain and that stored and transmitted Ether and Ethereum-based assets and that raised the equivalent of $150 million last year.

     

    Momentum began to build after that, as a smaller group of [these offerings] grew in size, and by last fall, some companies were raising millions of dollars in minutes. That really kind of made people stand up and wonder if this is a new funding mechanism.

    TC: How many ICOs have there been to date?

     

    SM: There were 64 last year that collectively raised $103 million, excluding the DAO. So far this year, we’ve seen 25 offerings raise a bit more than $163 million, and we’re on track to see more than $210 million raised by the end of June.

     

    TC: So how do these ICOs work, practically speaking?

     

    SM: There’s a cadence to these things. You do the prep-work and get your project to a natural technical milestone. Then you pre-announce when you’re planning to have a token sale, describing some of the terms, and telling a story of the project and its goals. You publish a white paper and disclosure and give people a chance to read it and comment. There are also usually threads that develop on Reddit, Bitcointalk, Slack, Telegram and elsewhere, where people actively debate the merits of the product. Then, on the landing page on the aforementioned date, there’s typically a tool that enables purchasers to acquire the tokens in exchange for bitcoin or ether.

     

    TC: Is there a concern that U.S. regulators will crack down on these ICOs?

     

    SM: Lawyers are relying on case law that defines what a security is. The most well-known case is the “Howey Test,” created by the Supreme Court for determining whether certain transactions qualify as investment contracts. If they do, then those transactions are considered securities and are subject to certain disclosure and registration requirements. When tokens are structured basically as the sale of a service or product, they’re designed to make sure the various prongs of the test are not triggered.

     

    TC: What types of companies are primarily using ICOs?

     

    SM: It’s still a financing mechanism that’s very organic to the blockchain community.

     

    It all started with protocols like Ethereum raising funding through this mechanism, and it has stayed close to related projects, like the distributed storage company Storj and Civic, a company that provides identify through the blockchain and is announcing its token sale this Thursday. A lot of these founders and token buyers are part of bitcoin forums and Reddit, and that’s why [certain companies] are able to raise these large sums fairly quickly; they’re reaching out to thought leaders and getting their support and generating buzz about their projects. It’s  basically the open source community, now with an open-source funding mechanism.

     

    TC: What happens when people want to sell the tokens they’ve bought?

     

    SM: Well, first, you can use them in a company’s ecosystem. With Storj, maybe you buy storage. You can also accumulate these tokens over time, as a bet that with more enterprise demand for storage capacity, the coins will become more valuable, after which you can sell your tokens to someone else who needs to purchase storage space.

    There are also a number of cryptocurrency exchanges where these tokens trade. In the case of Storj, you can sell or buy on Poloniex or Bittrex.

     

    TC: Should VCs be nervous about ICOs? You mention Civic, which is staging an ICO. Civic has also raised some venture capital previously. But plenty of other companies seem to be skipping the VC part.

     

    SM: To some degree they should, but we’ve also talked with a lot of very smart VCs who are looking at this space, including August Capital, Tim and Adam Draper, Blockchain Capital. Many are doing the work to understand how to be involved and active in the space and the fundamental value of these protocols. Union Square Ventures has said it now has a mandate from its LPs to hold these assets.

     

    For companies that raise funds through a token sale and that have had traditional angel or venture rounds previously, for example, their equity investors get to skip one or two rounds of dilution, which is great; it means their returns are hyper-levered.

    There are two points I want to emphasize from the above. First, just how early we are in the development of this area. The numbers are absolutely tiny at this point despite all the hype. Recall that in 2017, we’ve seen 25 offerings raise a bit more than $163 million. That’s an infinitesimally small number in the scheme of things, thus room for growth is massive. That being said, people considering getting involved in this space as a buyer of ICOs need to be extraordinarily careful.

    Investing in general is risky and challenging, but putting money into an ICO adds several other layers of complexity and risk. First, as noted above these things are not equity investments since they aren’t allowed to be under current regulations. Therefore, you’re not simply investing in a startup, which is always extremely risky, but you’re making a bet that the token itself is useful and will accrue in value over time. Therefore, not only do you need to be right about the success of the business or product itself, but the token also must have a real value-creating purpose to succeed in the long-run. Many people will not understand this and think they are buying into the equity of the underlying businesses, which sets up a perfect environment for fraudsters. You also need to bear in minds there’s a ton of Bitcoin liquidity that is flooding around the space given the massive run its had. Most early Bitcoin adopters and investors are very passionate and dedicated to this space. They don’t want to sell coin for dollars, but want to put it in new projects to keep the broader ecosystem growing. I think this is a fantastic thing, but it also means there’s a lot of crypto currency sloshing around trying to find a home.

    Despite the risks, I think the emergence of the burgeoning token market is a game-changing and extraordinarily empowering development. The only thing preventing the crypto-coin world from rapidly displacing the middlemen and bureaucrats of the traditional financial system are the barriers around the traditional financial world. While we’d like to think these barriers are there to protect the little people, we all know that the SEC and other such regulatory bodies largely exist to protect the rich and powerful and secure their moat.

    We saw this under Obama’s Mary Jo White, and we will surely see it under Trump’s pick Jay Clayton, who seems to have all sorts of conflicts, including a wife who works at Goldman Sachs. The SEC doesn’t protect the people, but as long as it pretends to, it can continue to function as a gatekeeper for financial oligarchs and slow down the pace of displacement of the dying financial system with the new parallel one currently being created.

    All of that is fine I suppose, and innovation in the crypto world will continue until one day we will actually see equity offerings in startups to regular people as opposed to just allocations to the wealthiest clients of brokerage firms. The innovation in this space has the potential to flatten the world of investing in a meaningful and powerful way, starting today with tokens, but ultimately in many other ways as well. It’s gonna take time, but it’ll happen.

    At this point, I just want to briefly address the common retort that “governments will never let this happen,” which I get all the time. Here’s what I had to say about it yesterday on Twitter, and I don’t really have much to say beyond this.

    To conclude, I’d like to dedicate this post to all the brilliant geeks and the dynamic entrepreneurs pushing hard every day to realize this incredible dream of a decentralized future. A future that breaks down barriers, removes middlemen and empowers humanity to take its next evolutionary leap forward. You are the ones creating this brand new world brimming with potential and optimism, and I want to thank for all you have done and continue to do.

  • Former Navy Seal To Katy Perry: 'Go To Hell… Hold One Of Your Concerts In Syria And See How It Goes'

    Katy Perry, a woman so crazy Russell Brand divorced her over text message, broke down in tears Saturday night at a concert and urged the crowd ‘not to let terrorists win’ in response to the Manchester bombing. Tuesday morning, she went on the radio to tell everyone all we need is open borders, hugs, and love in response to horrific terrorism. Basically this.

    Paul Joseph Watson can bring you fully up to speed:

      

    And today on Fox, former Navy Seal Carl Higbie who was responsible for triggering an entire CNN panel last week, had a few choice words for Ms. Perry – daring her to hold a concert in Syria if she thinks peace and love is all it’ll take to conquer ISIS:

    “We don’t have people who respect the culture of the United States of America. You have people like Katy Perry, for instance. I mean, this woman has said ‘oh we need to give them hugs, hug it out. Go to hell Katy Perry.

     

    “Hold one of your concerts in Syria and see how it goes.”

     

      

     

    What a strange, out of touch woman…

    Content originally generated at iBankCoin.com * Follow on Twitter @ZeroPointNow

  • Greg Gianforte Crushes Opponent in Congressional Run-Off, In Spite of Body Slamming Reporter

    The vapid taste of loss must get repetitive for Democrats in America. In spite of the scandals, the Russians, and John Podesta’s email box being the laughing stock of the entire world, they keep losing. The Republican candidate for Congress, Greg Gianforte, grabbed a reporter from The Guardian, Ben Jacobs, by his neck, body slammed him to the ground, and then pounded on him — Saul Rosenberging his glasses. Yet, on election night, despite the negative press, the good people from Montana voted in droves for Gianforte.

    With 84% of precincts reporting, Gianforte had 172,743 votes — or 50.4% of the vote, compared to Quist who has 150,007 votes, 43.8% of the vote, according to Edison Research.

    It’s embarrassing, really.

    Being the rugged gentlemen that he is, Rep. Gianforte apologized tonight, just before he graciously accepted his win.

    Here’s how the rural folk felt about the whole body-slamming ordeal.

    Via CNN:

    “We whole-heartedly support Greg. We love him,” said Karen Screnar, a Republican voter who had driven all the way from Helena to support Gianforte. Screnar said she and her husband have known Gianforte for the better part of a decade. After Gianforte was charged with misdemeanor assault, Screnar said she was only “more ready to support Greg.”

    “We’ve watched how the press is one-sided. Excuse me, that’s how I feel. (They’re) making him their whipping boy so to speak through this campaign,” Screaner said. “There comes a point where, stop it.”

    Her husband, Terry, chimed in that he believed Gianforte was “set up.”

    The left argues that the GOP is an out of control train-wreck, being led down wayward paths by Trump-Hannity and now Gianforte. Drama aside, even if that was true, what’s more alarming is the fact that people are so sick of establishment politics, they’d rather vote for a man who punches reporters in the face, rather than cordially declining his questions.
    Content originally published at iBankCoin.com

  • Has The Drug War Incentivized Police To Treat Citizens Like Terrorists?

    Authored by Duane Norman via Free Market Shooter blog,

    A video of a Florida Sheriff making a promo video to scare has been making the rounds recently.  Casey Research recently covered the affair, noting the following quote from Sheriff Grinnell:

    “Enjoy looking over your shoulder, constantly wondering if today’s the day we come for you. Enjoy trying to sleep tonight, wondering if tonight’s the night our SWAT team blows your front door off the hinges. We are coming for you.”

    The video (reproduced below, with commentary from Casey Research) is as surreal as the above picture implies…

    Sheriff Grinnell delivered this message last month while flanked by four combat-ready officers wearing ski masks. It looks like someone from ISIS directed it.

     

    Grinnell’s message was aimed at local drug dealers. You see, Lake County has a serious opioid problem. And like many other places in the US, it’s fighting its drug problem as if it were a war.

    …but this is hardly the first time a video like this has been produced, and it likely won’t be the last.  Last year, former Sheriff Clay Higgins, known as the “Cajun John Wayne” in Louisiana, released the below video calling out the “Gremlins” gang, and before his resignation, was known for making many similar videos:

    Some notable quotes from Sheriff Higgins:

    • You won’t walk away.  Look at you. Men like us, son, we do Dumbbell presses with weights bigger than you.
    • Young man, I’ll meet you on solid ground, anytime, anywhere. Light or heavy, it makes no difference to me.
    • You will be hunted, you will be tracked. And if you raise your weapon to a man like me, we’ll return fire with superior fire.
    • You don’t like the things I’ve told you tonight?  I’ve got one thing to say – I’m easy to find.

    This guy certainly has enough one-liners to be worthy of the “Cajun John Wayne” moniker, but it seems none of the police or community leaders behind him bothered to ask why criminals engage in such violent behavior; they are trying to profit from the obscenely high price of illegal drugs.  And when it comes to profit, the criminals are hardly alone.

    Free Market Shooter has covered the problems with Civil Asset Forfeiture in the past…

    Martin Armstrong of Armstrong Economics explains how police have every reason to seize assets, largely because these civil asset forfeitures are literally funding police departments:

     

    Between 1989 and 2010, U.S. attorneys seized an estimated $12.6 billion in asset forfeiture cases. The growth rate during that time averaged +19.4% annually. In 2010 alone, the value of assets seized grew by +52.8% from 2009 and was six times greater than the total for 1989. Then by 2014, that number had ballooned to roughly $4.5 billion for the year, making this 35% of the entire number of assets collected from 1989 to 2010 in a single year. According to the FBI, the total amount of goods stolen by criminals in 2014 burglary offenses suffered an estimated $3.9 billion in property losses. This means that the police are now taking more assets than the criminals.

    …but if you take a closer look at the forfeitures themselves, you’ll realize just how many of them are related to the war on drugs:

    “Thirty-six percent of all local police departments received money, property, or goods from a drug asset forfeiture program during 2002 (table 32). These departments employed 78% of all local police officers. At least 80% of the departments in each population category of 25,000 or more had drug asset forfeiture receipts.”

     

    “There can be few components of law enforcement programmes which actually cost nothing. The asset forfeiture provision of the federal law for crop suppression (relating mainly to cannabis in the State of Kentucky), proved to be such a case, costing the United States Government $13.7 million, but yielding a return of $53 million in 1991, or almost $4 in assets seized for every $1 invested by the Drug Enforcement Administration.”

     

    “The advent of a now common police tactic, called the “reverse sting,” illustrates the shift in priorities from crime control to funding raids. In a reverse sting, an officer attempts to sell drugs to an unsuspecting buyer. The method permits the police to seize the buyer’s cash rather than a seller’s drugs, which have no value to the agency.

     

    “During the past decade, law enforcement agencies increasingly have turned to asset seizures and drug enforcement grants to compensate for budgetary shortfalls, at the expense of other criminal justice goals. We believe the strange shape of the criminal justice system today—the law enforcement agenda that targets assets rather than crime, the 80 percent of seizures that are unaccompanied by any criminal prosecution, the plea bargains that favor drug kingpins and penalize the “mules” without assets to trade, the reverse stings that target drug buyers rather than drug sellers, the overkill in agencies involved even in minor arrests, the massive shift towards federal jurisdiction over local law enforcementis largely the unplanned by-product of this economic incentive structure.”

    So the drug war has created a massive financial incentive for police to seize property from individuals, one that many departments could require to stay afloat.  What do you think happens next?

    As Free Market Shooter has covered previously for Single Dude Travel, raids from SWAT teams have become commonplace, with police becoming better armed by the day:

    Our nation’s policing system has become profit-driven instead of crime-driven, largely due to the failure of the war on drugs, and the fact that cops have been given surplus military hardware from the armed forces at bargain basement prices. SWAT team raids have gone from a few hundred per year in the 1970s to 50,000 annually, largely because they call SWAT in when “Special Weapons And Tactics” aren’t really needed, such as when apprehending a credit card scammer or raiding an organic farm for the filmiest of reasons. When a SWAT team nearly kills a 19-month old baby with a flashbang grenade, in a raid without the suspect present, how are there no charges filed?

    And now that police are all armed to the teeth looking for property to seize, what happens next?  The practice is applied everywhere.  If you look at a report on the “most outlandish SWAT team raids” across the country, you’ll see just how common it is to have a SWAT team called in:

    • Armed agents raid animal shelter in search of baby deer—and kill it.
    • Girl’s home wrongfully raided with flashbangs despite door being open.
    • SWAT team raids DJ’s studio to enforce copyright law.
    • SWAT squad invades private poker game.
    • SWAT team raids man’s home in search of stolen koi fish.
    • Sex toys, condoms and pajamas seized in drug/prostitution SWAT team raid.
    • Peaceful monks arrested in SWAT team action.
    • Feds raid Amish dairy farm—twice—for selling unpasteurized milk.
    • Police unlawfully invade a series of barbershops without warrants.
    • Police forcibly search and detain 19 patrons in gay bar.
    • SWAT team confiscates wood used to make instruments during illegal raid.

    So, how do you stop police from treating civilians like they would treat terrorists?  The best place to start is removing the incentive structure that has been created by the war on drugs, which brings us back to Casey Research’s commentary:

    Illegalizing something does nothing but create a black market and give people a reason to induce other people to get high. I mean, people have been drinking alcohol for about the last 10,000 years. But it didn’t become a real problem until the Eighteenth Amendment and the Volstead Act passed in 1920. At that point, it financed the mafia.

     

    Laws turn simple bad habits into massive and profitable criminal enterprises.

     

    The government learned absolutely nothing from the failure of alcohol prohibition. What they’re doing with drugs makes an occasional, trivial problem into a national catastrophe…

    However, do not expect that to happen anytime soon; again, as Free Market Shooter has covered in the past, new Attorney General Jeff Sessions is adamant about expanding the war on drugs:

    And, in case you weren’t aware, this is the same Jeff Sessions who is on the record as being not only against medicinal marijuana, it is the same Jeff Sessions that has stated that marijuana is only slightly less awful than heroin:

     

         And I am astonished to hear people suggest that we can solve our heroin crisis by legalizing marijuana – so people can trade one life-wrecking dependency for another that’s only slightly less awful.

    Then again… it’s not like the prior ten attorney generals did anything but continue the war on drugs.  Remember what Casey said about “massive profitable criminal enterprises”?

  • Visualizing How The Big 5 Tech Giants Make Their Billions

    Hitting record high after record high, tech companies have displaced traditional blue chip companies like Exxon Mobil and Walmart as the most valuable companies in the world.

    Here are the latest market valuations for those same five companies:

    Together, they are worth $2.9 trillion in market capitalization – and they combined in FY2016 for revenues of $555 billion with a $94 billion bottom line.

    BRINGING HOME THE BACON?

    Despite all being at the top of the stock market food chain, Visual Capitalist's Jeff Desjardins points out that the companies are at very different stages.

    In 2016, Apple experienced its first annual revenue decline since 2001, but the company brought home a profit equal to that of all other four companies combined.

    On the other hand, Amazon is becoming a revenue machine with very little margin, while Facebook generates 5x more profit despite far smaller top line numbers.

    HOW THEY MAKE THEIR BILLIONS

    Each of these companies is pretty unique in how they generate revenue, though there is some overlap:

    • Facebook and Alphabet each make the vast majority of their revenues from advertising (97% and 88%, respectively)
    • Apple makes 63% of their revenue from the iPhone, and another 21% coming from the iPad and Mac lines
    • Amazon makes 90% from its “Product” and “Media” categories, and 9% from AWS
    • Microsoft is diverse: Office (28%), servers (22%), Xbox (11%), Windows (9%), ads (7%), Surface (5%), and other (18%)

    What does that look like?

     

    Courtesy of: Visual Capitalist

    Lastly, for fun, what if we added all these companies’ revenues together, and categorized them by source?

    Note: this isn’t perfect. As an example, Amazon’s fast-growing advertising business gets lumped into their “Other” category.

    Hardware, e-commerce, and and advertising make up 76% of all revenues.

    Meanwhile, software isn’t the cash cow it used to be, but it does help serve as a means to an end for some companies. For example, Android doesn’t generate any revenue directly, but it does allow more users to buy apps in the Play Store and to search Google via their mobile devices. Likewise, Apple bundles in operating systems with each hardware purchase.

  • Paul Craig Roberts On JFK At 100

    Authored by Paul Craig Roberts,

    This Memorial Day, Monday, May 29, 2017, is the 100th birthday of John Fitzgerald Kennedy, the 35th President of the United States.

    JFK was assassinated on November 22, 1963, as he approached the end of his third year in office. Researchers who spent years studying the evidence have concluded that President Kennedy was assassinated by a conspiracy between the CIA, Joint Chiefs of Staff, and Secret Service. (See, for example, JFK and the Unspeakable by James W. Douglass)

    Kennedy entered office as a cold warrior, but he learned from his interaction with the CIA and Joint Chiefs that the military/security complex had an agenda that was self-interested and a danger to humanity. He began working to defuse tensions with the Soviet Union.

    His rejections of plans to invade Cuba, of the Northwoods project, of a preemptive nuclear attack on the Soviet Union, and his intention to withdraw from Vietnam after his reelection, together with some of his speeches signaling a new approach to foreign policy in the nuclear age (see for example), convinced the military/security complex that he was a threat to their interests.

    Cold War conservatives regarded him as naive about the Soviet Threat and a liability to US national security. These were the reasons for his assassination. These views were set in stone when Kennedy announced on June 10, 1963, negotiations with the Soviets toward a nuclear test ban treaty and a halt to US atmospheric nuclear tests.

    The Oswald coverup story never made any sense and was contradicted by all evidence including tourist films of the assassination. President Johnson had ro cover up the assassination, not because he was part of it or because he willfully wanted to deceive the American people, but because to give Americans the true story would have shaken their confidence in their government at a critical time in US-Soviet relations. To make the coverup succeed, Johnson needed the credibility of the Chief Justice of the US Supreme Court, Earl Warren, to chair the commission that covered up the assassination. Warren understood the devastating impact the true story would have on the public and their confidence in the military and national security leadership and on America’s allies.

    As I previously reported, Lance deHaven-Smith in his book, Conspiracy Theory in America, shows that the CIA introduced “conspiracy theory” into the political lexicon as a technique to discredit skepticism of the Warren Commission’s coverup report. He provides the CIA document that describes how the agency used its media friends to control the explanation.

    The term “conspiracy theory” has been used ever since to validate false explanations by discrediting true explanations.

    President Kennedy was also determined to require the Israel Lobby to register as a foreign agent and to block Israel’s acquisition of nuclear weapons. His assassination removed the constraints on Israel’s illegal activities.

    Memorial Day is when Americans honor those in the armed services who died serving the country. JFK fell while serving the causes of peace and nuclear disarmament. In a 1961 address to the United Nations, President Kennedy said:

    “Today, every inhabitant of this planet must contemplate the day when this planet may no longer be habitable. Every man, woman and child lives under a nuclear sword of Damocles, hanging by the slenderest of threads, capable of being cut at any moment by accident or miscalculation or by madness. The weapons of war must be abolished before they abolish us. It is therefore our intention to challenge the Soviet Union, not to an arms race, but to a peace race – to advance together step by step, stage by stage, until general and complete disarmament has been achieved.”

    Kennedy’s address was well received at home and abroad and received a favorable and supportive response from Soviet leader Nikita Khrushchev, but it caused consternation among the warhawks in the Joint Chiefs of Staff. The US led in terms of the number of nuclear warheads and delivery systems, and this lead was the basis for US military plans for a surprise nuclear attack on the Soviet Union. Also, Many believed that nuclear disarmament would remove the obstacle to the Soviet Army overrunning Western Europe. Warhawks considered this a greater threat than nuclear armageddon. Many in high military circles regarded President Kennedy as weakening the US viv-a-vis the Soviet Union.

    The assassination of President Kennedy was an enormous cost to the world. Kennedy and Khrushchev would have followed up their collaboration in defusing the Cuban Missile Crisis by ending the Cold War long before the military/security complex achieved its iron grip on the US government. Israel would have been denied nuclear weapons, and the designation of the Israel Lobby as a foreign agent would have prevented Israel’s strong grip on the US government. In his second term, JFK would have broken the CIA into a thousand pieces, an intention he expressed to his brother, Robert, and the Deep State would have been terminated before it became more powerful than the President.

    But the military/security complex struck first, and pulled off a coup that voided all these promises and terminated American democracy.

    *  *  *

    Finally, in one of the most iconic political speeches of the 20th century, at his 1961 inauguration address, President Kennedy told his fellow Americans to "ask not what your country can do for you, ask what you can do for your country". To mark the 100 year anniversary of his birth on Monday, Statista's Martin Armstrong has taken a look at what Kennedy's country did for him after his untimely death.

    Infographic: What JFK's Country Did For Him | Statista

    You will find more statistics at Statista

  • Pennsylvania Coroner Says Dying Addicts Keep Morgue Full "Most Nights"

    The coroner’s office in Montgomery County, Pennsylvania is literally running out of room for all the bodies that are piling up because of America’s worsening synthetic opioid epidemic, according to Triblive.com.

    As the story notes, heroin isn’t responsible for these deaths; rather, Synthetic opioids like fentanyl, carfentanil and their many analogues are the chief culprit.

    As Triblive reports:

     

    “Lab-created, designer opioids have far outpaced heroin as a killer of addicts, and they've kept the coroner's office full on most nights.

     

    "If this pace continues, I'm not really sure what we're going to do," said Montgomery County, Ohio, coroner Dr. Kent Harshbarger. "We had 13 (bodies) yesterday, and 12 of them were overdoses."

     

    The county’s coroner had to expand his cooler last month because its 36-body capacity wasn’t enough. It now has room for 42 bodies, and the country still occasionally runs out of space.

    “It’s full every night.”

    Harshbarger even ran out of space one day earlier this year, again because of overdoses, and was forced to send some bodies to a local funeral home for storage. He also occasionally rents refrigerated trailers that can be brought in when deaths spike.

    In Allegheny County, health officials, instances of fentanyl-related overdoses surpassed those of heroin for the first time in 2016. Six hundred people overdosed and died in the county last year – most from opioids, said Dr. Karen Hacker, director of the Allegheny County Health Department.

    Having surpassed gun homicides for the first time in 2015, the epidemic of heroin and opioid related deaths in the US continues to grow, amid the dismal failure of the 'war on drugs.’ Lawmakers, who have only just begun to wake up to the crisis, have requested more data about the synthetic opioid fentanyl, including how it is trafficked and how many people it has killed.

    The ramifications of the crisis stretch far beyond hospitals and morgues: Ohio saw a 13% increase in children in foster care last year, which officials suspect is linked to the growing number of overdose deaths.
     

  • ESPN And The Bursting Of The Sports Bubble

    Authored by William Anderson via The Mises Institute,

    When the cable TV sports giant ESPN announced 100 layoffs recently, including letting go a number of high-profile broadcasters, a lot of people took notice, and well they should: things no longer are business as usual in sports broadcasting, and we are not even at the beginning of the end, and maybe not even the end of the beginning.

    Like the slow crashing of the retail sector as online purchase firms like Amazon begin their domination, we are seeing a sea change in sports broadcasting and that is going to mean big changes are down the road not only for ESPN, but for all of the sports entities that depend upon the huge payouts that ESPN provides. To put it mildly, a lot of people are about to see their lives change drastically as consumer choices drive sports broadcasting in a new direction.

    Enough with the superlatives. What is happening with ESPN, and why is it important? As Clay Travis of the sports website Outkick the Coverage has been writing for more than a year, the main ESPN business plan, the one that brings in the most revenues to the firm, is doomed to near-extinction, and there is nothing ESPN can do about it. Writes Travis:

    In the past five years ESPN has lost 11,346,000 subscribers according to Nielsen data.

     

    If you combine that with ESPN2 and ESPNU subscriber losses this means that ESPN has lost over a billion dollars in cable and satellite revenue just in the past five years, an average of $200 million each year. That total of a billion dollars hits ESPN in the pocketbook not just on a yearly basis, but for every year going forward.

     

    It's gone forever.

    Since it began to grow in popularity in the late 1970s, cable (and later, satellite) television has offered its customers coverage with “bundles,” that is different payments allow cable subscribers to expand their viewership as payments increase. For example, a “basic” cable subscription would allow the customers to view, say, 15 channels including the ABC-CBS-NBC-PBS lineup plus other channels such as CNN or Fox. A higher-tier subscription would add other channels, including ESPN and its associated channels and others such as The Food Channel or assorted movie channels.

    One problem with bundling, of course, is that subscribers will pay for channels that they rarely or do not watch. For example, I have a basic subscription with Direct TV, but maybe watch 10 channels at most, even though dozens are available. (I don’t include ESPN or any of the other sports channels in my monthly package.)

    As technology has improved in telecommunications, the ability of providers to further segment packages has meant that cable and satellite subscribers are able to eliminate the channels they don’t want to watch, and that means that many are unhooking from ESPN. Continues Travis:

    ESPN is losing 10,000 subscribers every day so far in 2017. In the past six years they have lost 13 million subscribers and that subscriber loss is escalating each year. That's billions of dollars in lost revenue.

     

    Every year for the next five years ESPN is spending more and bringing in less. You don't have to be Warren Buffett to see that's a business problem. 

    He goes on to the heart of the matter:

    ESPN is spending over eight billion dollars on sporting rights this year and by 2021 I believe they will be losing money regardless of how many people they fire. ESPN can't fire employees into profitability. It's just not possible. These firings are going to become a yearly thing and they still aren't going to prevent the business from dying. 

    True, ESPN, as well as all commercial broadcasters, receive advertising revenue, but advertising alone, along with subscriptions from people who choose to purchase ESPN in their cable/satellite packages, will not be enough for the network to meet its obligations to the various organizations it pays for the rights to broadcast their events. From the National Football League (NFL), to the National Hockey League (NHL), to the National Basketball Association (NBA) to the National Collegiate Athletic Association (NCAA), ESPN has paid billions of dollars, money that is funneled into high athlete salaries, not to mention salaries of coaches, university athletic directors, and, indirectly into the building and maintaining of magnificent sports facilities.

    The revenues lost to ESPN are lost forever, and even given the rise of smart phones and Internet streaming, the current state of affairs is unsustainable and the sports landscape is going to change, and the changes will be extensive. It is here that Austrian economics gives us insight into how at least some of the changes will proceed.

    Carl Menger, who we know as the “founder” of the Austrian school of economics, in his path-breaking book Principles of Economics in 1871 demonstrated conclusively that the value of the factors of production was based not on costs derived from other costs of production, but rather the value of the factors was imputed via the value consumers placed upon the final goods. This view contradicted the standard British classical view that the value of consumption goods was derived from the value of the factors of production, and it placed Menger in the Pantheon of the early Marginalists.

    In laying out his theory, Menger used tobacco and the factors used to produce it. If people suddenly stopped using tobacco, he reasoned, then the value of the factors would change quickly relative to their ability to be transferred to other uses. The more specialized the factor, the greater the change in its value. For example, the land on which tobacco is grown would then be used for other purposes, such as growing corn or wheat, or even pasture for cows or sheep. Highly-specialized tools used only for growing or harvesting tobacco, however, would see a steep drop in value and maybe would have to be abandoned altogether.

    What does this have to do with the demise of ESPN? As noted earlier, the network pays billions of dollars for rights to broadcast sports events, and it is unlikely that as ESPN loses the revenues that permit it to pay large sums, other networks will be able to take up that slack. That means the organizations that now receive this money are looking at “haircuts” down the road, which includes the NCAA and collegiate athletic teams.

    The ESPN funding allows for the network to broadcast a number of collegiate sports events that ordinarily would not rate enough of an audience, and its large payouts also allow for coaches to receive record-high salaries that would not be possible if these programs depended just on ticket sales and other donations. And while it is tempting to say that “ESPN pays for this,” in reality, it is the consumer of cable/satellite television that ultimately decides the size of the ESPN payouts, and consumers are stating their preferences with their checkbooks, and there is nothing ESPN can do about it.

    Without cable/satellite subscribers being willing to pay extra for the sports channels, and without the viewership that draws advertisers, ESPN revenues will fall, and that means that the factors that make up the “product” that appears on ESPN broadcasts also are going to lose value, as long as other networks don’t take up the slack (and it is doubtful they will). Thus, one is looking at a long, steady decline and the world of televised sports is going to have to adjust to the new reality.

    Unfortunately, as Travis has pointed out many times, ESPN during this ratings slide has taken a hard turn toward the political left, which has further alienated a lot of conservative viewers. Writes Travis:

    As ESPN has lost 10,000 cable and satellite subscribers every day in 2017, seen ratings collapse for all original programming, and recently embarked on the firing of 100 employees as part of a desperate cost cutting move to save its business. The network’s sports media defenders have desperately argued that the network’s embrace of far left wing politics has not had any impact on its collapsing viewership. That’s despite the fact that there have been two different studies that have demonstrated Republican voters have abandoned the network’s original programming in the past year.

    In that regard, one can argue that ESPN has done what numerous (and especially elite) colleges and universities have done the past several years: create a hostile atmosphere for white male students all the while wanting them to be paid customers. One cannot both seek to offend and attack the same people one wishes to purchase their services without courting disaster, yet higher education and ESPN are doing just that.

    To a certain extent, one can argue that both higher education and ESPN have benefited from “bubble” economies, and as consumer choice becomes directed elsewhere, the bubbles burst. As Carl Menger demonstrated, the bursting of the bubbles will mean that some factor owners will have to receive less pay in order to remain employed, while other factors will have to be transferred to other uses altogether or simply become unemployed. All soothing rhetoric aside, the world of sports broadcasting is going to see major changes in the next decade as consumers have their say.

  • FBI Refuses To Hand Over "Comey Memos" To Congress

    House Oversight Committee Chairman Jason Chaffetz said today that the FBI had decided to withhold documents, including memos, notes, summaries, and recordings, requested by his committee in regards to the ongoing Russia probe. This was revealed in a letter sent by Chaffetz to the FBI responding to the agency’s decision to withhold documents requested by the Committee on May 16, 2017.

    The FBI’s denial to cooperate is presented below:

    According to a statement by the Oversight Committee, “Chaffetz requested memos, notes, summaries, and recordings to assist in the Committee’s investigation of the FBI’s independence, and which are outside the scope of the Special Counsel’s investigation.”

    The documents are due June 8, 2017, but that may not happen as it appears the FBI is suddenly unwilling to cooperate.  

    As Chaffetz elaborates, after a New York Times report that former Federal Bureau of  Investigation Director James Corney memorialized the content of phone calls and meetings with the President in a series of memoranda, he requested those memoranda and any related notes, summaries, and recordings. The FBI is withholding those documents, citing to the appointment of Robert Mueller as Special Prosecutor. According to a letter from your staff: “In light of this development and other considerations [the Bureau] is undertaking appropriate consultation to ensure all relevant interest implicated by your request are properly evaluated.

    The letter states:

    “The Committee has its own, Constitutionally-based prerogative to conduct investigations. But the Committee in no way wants to impede or interfere with the Special Counsel’s ability to conduct his investigation.  In fact, the Committee’s investigation will complement the work of the Special Counsel. Whereas the Special Counsel is conducting a criminal or counterintelligence investigation that will occur largely behind closed doors, the Committee’s work will shed light on matters of high public interest, regardless of whether there is evidence of criminal conduct.

     

    “The focus of the Committee’s investigation is the independence of the FBI, including conversations between the President and Comey and the process by which Comey was removed from his role as director.  The records being withheld are central to those questions, even more so in light of Comey’s decision not to testify before the Committee at this time.”

     

    “I am seeking to better understand Comey’s communications with the White House and Attorney General in such a way that does not implicate the Special Counsel’s work.”

    As Chaffetz concludes, “Congress and the American public have a right and a duty to examine this issue independently of the Special Counsel’s investigation. I trust and hope you understand this and make the right decision-to produce these documents to the Committee immediately and on a voluntary basis.

    The American public is certainly looking forward to the FBI’s release of the full content of the Comey’s memos, not only those relating to his meetings with Trump, but just as importantly, with Loretta Lynch, as well as Barack Obama and/or Hillary Clinton.

    Full text of Chairman Chaffetz letter can be viewed here.
    Full text of FBI letter can be viewed here.

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  • Suspected Berkeley Antifa Bike Lock Attacker Eric Clanton Arrested For Assault

    Eric Clanton, 28, a former Diablo Valley and California State University philosophy professor suspected in the Antifa bike lock attacks was arrested for assault Wednesday afternoon in Oakland.

    Clanton is being held on $200,000 bail after being booked into Berkeley City Jail – though police have not said whether the arrest is connected to online investigative efforts which identified Clanton as a person of interest in bike lock attacks

    “[Clanton] was arrested on suspicion of use of a firearm during a felony with an enhancement clause and assault with a non-firearm deadly weapon. –East Bay Times

    //platform.twitter.com/widgets.js

     

    4chan unmasking

    Clanton is the suspected Antifa member going around with a bike lock assaulting Trump supporters. The weaponized autists over at 4chan ‘unmasked’ him based on photographic and video evidence along with publicly available information. 

    (Attack at 18 sec)

     

     

    How 4chan did it… 

     

    Content originally generated at iBankCoin.com * Follow on Twitter @ZeroPointNow

  • Snyder: Desperate Liberals Try To Blame The Manchester Terror Attack On Anyone Other Than Islamic Terrorists

    Authored by Michael Snyder via The End of The American Dream blog,

    The left just can’t seem to understand that Islamic terrorists are going to try to destroy our way of life no matter how nice we are to them. On Monday night, a bombing at Ariana Grande’s Manchester concert made headlines all over the globe. 22 people, including an 8-year-old girl, were killed and 59 were wounded. It is exactly the sort of “soft target” attack that I have been warning about, and ISIS quickly claimed responsibility. Within the last 30 days, there have been 169 Islamic terror attacks in a total of 24 different countries. Last year, the number of global terror attacks was up 25 percent from the year before, and this year we will almost certainly see another all-time record high. But many liberals never even want to use the phrase “Islamic terror” because it doesn’t fit their agenda.

    In fact, many liberals immediately jumped on Twitter after the terror attack in Manchester and started warning about the spread of “Islamophobia”.

    For example, Quen Took posted the following tweet…

    Don’t use incident as an excuse for Islamophobia. Stand with our beautiful Muslim siblings & don’t scapegoat innocent people.

    And TheBardAsPundit warned that engaging in “Islamophobia” may provoke more terror attacks…

    I have a good idea. Let’s piss off more Muslims with mindless Islamophobia. That should help.

    Of course the mainstream media here in the United States attempted to put their own politically-correct spin on things. On ABC, there was far more concern about “anti-Islamic backlash” than there was for the victims of the attack…

    Despite the horrific nature and impact, ABC was eager to downplay the motive behind the deadly attack. In fact, ABC was more worried about the perpetrators than the victims, warning that this could provoke an “anti-Islamic backlash” across Europe.

    And on the Today show on NBC, counter-terrorism “expert” Richard Clarke seemed to blame President Trump for the rise in terror attacks that we have been seeing…

    They have a good police and security service and so do we, but we have no ostracized, we’ve embraced our Muslim Americans. That’s why the talk against Muslims in the last year in the campaign and since has been very counterproductive. The only way to solve this problem is to have everyone think they’re on the same side.

    Yes, let’s follow Clarke’s advice and try to convince the Islamic terrorists that we are on their side.

    That should work.

    Until the entire western world is willing to embrace Islam and swear allegiance to Allah, the radical Islamists will never stop. Their faith tells them that it is their destiny to rule the world, and they will never rest until they have achieved that goal.

    Unfortunately, most people believe what they want to believe, and what most politically-correct pundits in the western world want to believe is that radical Islam is not the problem.

    On CNN, one “analyst” even suggested that the attack in Manchester may have been a “false flag” conducted by “right-wing” extremists…

    CNN “Terror Analyst” Paul Cruickshank said Monday night on Anderson Cooper’s AC360 that the bombing attack in Manchester could be a “right-wing” “false flag.”

     

    “It must also be noted that in recent months in Europe, there’s been a number of false flag plots where right-wing extremists have tried to frame Islamists for terrorism,” Cruickshank said. “We have seen that in Germany in recent weeks.”

    Of course that theory didn’t last long once the authorities identified the attacker as a Muslim.

    It is absolutely imperative that we understand the mindset of these Islamic radicals. If they could press a button that would annihilate all non-Muslims on the entire planet, many of them would do it.

    Some of the more “moderate” jihadists would prefer to give everyone a chance to convert to Islam first before killing them, but the end result would be the same.

    There is no possible way to compromise with people that are intent on exterminating you. And as they get their hands on more powerful weapons, the size and scale of these terror attacks is going to increase exponentially.

    We must make every effort to defeat terror groups such as ISIS militarily, but even more importantly we must seek to turn hearts and minds away from radical Islam all over the planet. It is a bankrupt worldview, and we need to show those that are following radical Islam that there is a much better way.

    Unfortunately, nations all over the western world are turning away from the values and the principles that they were founded upon, and so western leaders have very little to offer at this point.

    One recent report found that Islam is on track to surpass Christianity and will become the largest faith on the entire planet by the year 2070. Violence and bloodshed will continue to be used by jihadists to advance their faith, but another way that the goal of global domination is moved forward is by migration. Paul Nehlen, the author of an upcoming book entitled “Wage The Battle”, recently explained how this works

    “Hijrah means ‘migration in the name of Allah,’” said Nehlen, who explained that the ultimate goal is to populate non-Muslim nations to the extent needed to impose Shariah law.

     

    “The hijrah is one way of spreading the Shariah, spreading the law of Islam, this political doctrine, to land where Islam isn’t,” Nehlen said. “That’s what this documentary covers. It talks about the bigger picture here of what we saw here. It stems directly from their fundamental texts.”

     

    He said hijrah is another method by which Muslims can earn their salvation.

     

    “Quite unlike a Christian, who believes you can’t earn your way in and only by the grace of God are you granted access to heaven through Christ’s sacrifice on the cross, Muslims believe they can earn their way in,” Nehlen said. “They believe they have to earn their way in.”

    Radical Islam has declared war on us, but most liberals don’t even think that we are in a war.

    And in any war, if one side chooses not to fight the other side wins by default.

    The western world desperately needs to wake up, because we are in a life or death battle, and right now this fight is only in the early rounds.

  • Japan's "Womenomics" Is Working Just As Well As Abenomics… Terribly

    Via Japan Subculture Research Center,

    Japan is getting serious about gender equality – and there were absolutely no bribes paid by Japan to win the right to host the 2020 Olympics – and the nuclear disaster at Fukushima is under control. Decide for yourself which of these three statements is the most untrue.

    Womenomics was touted by Japan’s Prime Minister Shinzo Abe as his progressive policy to elevate the status of women in what is still a very sexist and unequal society, where women are far from being empowered. The Global Gender Gap report published last year noted that Mr. Abe and the LDP’s pledge to bridge the gender divide resulted in actually widening the gulf, with Nippon sliding down a few notches to 111th in terms of world gender equality. 

    It’s hard to see women in Japan being “empowered” when they can be sexually assaulted with near impunity. The odds that their assailant will be arrested, or prosecuted are low–less than a coin toss. And if he is actually prosecuted–he can sometimes walk free, with no jail time and no criminal record,  by paying damages and saying, “I’m sorry.” It’s a situation that the Abe administration could have changed but neglected to do so, tabling newly revised criminal codes to instead focus on passing a conspiracy bill that the United Nations warns could erode civil liberties.

    Of course, some would argue that “womenomics” have never been about elevating the status of women in Japan – it’s always been about keeping Japanese business thriving and hopefully encouraging woman to work – and breed. Of course, pregnancy in the workplace often is greeted with bullying from all sides. Abe’s vision of Womenomics has certainly never been about improving the lives of Japan’s single mothers, 50% of whom live in poverty. In fact, other than talking about “shining women–it’s not clear exactly what he wants for Japan’s future potential birthing machines.*

    The current Minister of Gender Equality and Women’s Empowerment, is of course, also a man, and also in charge of improving Japan’s birthrate. Do we need to say more?

    Yes, Japan’s Prime Minister Abe and the LDP are gungho about Gender Equality. Meet Katsunobu Kato, his home page will convince you.

    Recently, Bloomberg published an interview with Democratic Party leader Renho, in which she pointed out the obvious, Womenomics is all talk and no walk.

    “They should be ashamed to use the word ‘Womenomics’,” Democratic Party leader Renho, the 49-year-old mother of twins, said in an interview in Tokyo late Thursday when asked about the term Abe often uses to describe his efforts. “It’s an embarrassment.”

    Abe had vowed to eliminate waiting lists for childcare in a bid to draw more women into the workforce to make up for Japan’s shrinking population. He also sought to have women take 30 percent of management positions in all fields by 2020.

    On both goals he’s falling well short: Japan was 111th in the World Economic Forum’s Gender Gap ranking for 2016, down 10 places on the previous year.

    “About 80 percent of those who take childcare leave are women, and if they’re forced to wait for daycare, that means unemployment,” Renho said.

     

    “You either get demoted or you give up on work. What’s womenomics about if women are being forced to make such sad choices?

    For the rest of the article, go to

    Abe’s Policies Failing Women, Japan Opposition Chief Says

    *Reference to women as “birthing machines” is sarcasm. We know that the LDP also thinks of women as much more than that–as potential nurses for the elderly, expert green tea brewers for the office, and caretakers of the children that they should be giving birth to right now for the greater prosperity of Japan."

  • San Francisco Launches Public Defender Office Dedicated To Illegal Immigrants

    To our complete ‘shock’, the liberal bastion of California’s northern shores has just announced that it will create a brand new branch of the Public Defender’s office to specifically defend illegal immigrants in deportation cases.  Adding insult to injury, taxpayers will have to pony up an additional $200,000 each year to cover the cost of 3 public defenders and a paralegal, all of whom will be dedicated to making sure that federal laws are ignored.

    As an NBC affiliate in the Bay Area notes, the new office is expected to handle just 50 clients per year of the 1,500 detained immigrants that currently have scheduled court dates.  All of which just means that taxpayers should expect that $200,000 price tag to grow exponentially over the coming years.  

    Unlike in criminal court, immigrants are not automatically entitled to legal representation in deportation proceedings. However, studies have shown that detained immigrants with attorneys are six times more likely to win their cases.

     

    While San Francisco also provides funding to nonprofits specializing in legal aid to immigrants, the public defender’s office is intended to serve those already in detention, a demographic the nonprofits generally don’t serve.

     

    The unit’s attorneys are each expected to handle around 50 clients per year — a small portion of the estimated 1,500 detained immigrants who currently have court dates in San Francisco, around 85 percent of whom do not have attorneys.

    Meanwhile, thanks to a press release issued by the San Francisco Public Defender’s office, we learn that the enforcement of federal laws is apparently “against our core values as Americans and San Franciscans”…who knew?

    Adachi noted that in the 100 days since President Donald Trump signed his executive order expanding immigration enforcement priorities, immigration arrests have risen 38 percent nationwide.

     

    “Mass deportation is against our core values as Americans and San Franciscans,” Adachi said. “Due process still means something in this country and we are not going to let the federal government ship off our friends and neighbors without a fight.”

     

    Unlike in criminal court, non-citizens in immigration detention do not have the right to court appointed counsel, explained Francisco Ugarte, managing attorney of the Public Defender’s Immigration Unit. Approximately half of the 1,500 detained immigrants with court dates in San Francisco have been in the U.S. for more than a decade. More than 50 percent have one or more close family members who are citizens.

     

    “These are longtime residents who work, attend school, and contribute to our city,” Ugarte said. “Without this program, most would be forced to defend themselves in court against trained government lawyers.”

    Can we also declare that ‘grand larceny’ is “against our core values as Americans” because we think it’s absolutely bogus that we can’t have a couple of Lamborghini’s just because we’re “economically challenged.”

    http://www.nbcbayarea.com/portableplayer/?cmsID=423977644&videoID=tEXs4tolM5J0&origin=nbcbayarea.com&sec=news&subsec=local&Width=600%20Height=337

  • Meet JK2 Westminster LLC – The Kushner Family Real Estate Subsidiary Preying On Poor People

    Authored by Mike Krieger via Liberty Blitzkrieg blog,

    Cox stopped cooking for herself and her son, not wanting food near the sink. A judge allowed her reduced rent for one month. When she moved out soon afterward, Westminster Management sent her a $600 invoice for a new carpet and other repairs. Cox, who is now working as a battery-test engineer and about to buy her first home, was unaware who was behind the company that had put her through such an ordeal. When I told her of Kushner’s involvement, there was a silence as she took it in.

     

    Very few of the complex residents I met, even ones who had been pursued at length in court by JK2 Westminster, had any idea that their rent and late fees were going to the family company of the president’s son-in-law. “That Jared Kushner?” Danny Jackson, a plumber in his 15th year living at Harbor Point Estates, exclaimed. “Oh, my God. And I thought he was the good one.”

     

    At the Carroll Park complex, I met Mike McHargue, a private investigator, and his girlfriend, Patricia Howell. “They’re nothing but slumlords,” Howell told me of Westminster Management. “They take everyone’s money.” When I asked if they knew who was behind the company, they said they did not. “Oh, really?” Howell said when I mentioned Kushner’s name. “Oh, really. And I’m a Trump supporter.”

     

    From The New York Times Magazine article: Jared Kushner’s Other Real Estate Empire

    Yesterday, The New York Times Magazine published a deeply disturbing story about a Kushner family real estate subsidiary with a consistent pattern of aggressive and questionable collection practices aimed at lower income people who can’t defend themselves properly.

    Excerpts from the piece are below, but it should really be read in full.

    Warren sent a letter reporting the problem to the complex’s property manager, a company called Sawyer Realty Holdings. When there was no response, she decided to move out. In January 2010, she submitted the requisite form giving two months’ notice that she was transferring her Section 8 voucher — the federal low-income subsidy that helped her pay the rent — elsewhere. The complex’s on-site manager signed the form a week later, checking the line that read “The tenant gave notice in accordance with the lease.”

     

     

    So Warren was startled in January 2013, three years later, when she received a summons from a private process server informing her that she was being sued for $3,014.08 by the owner of Cove Village. The lawsuit, filed in Maryland District Court, was doubly bewildering. It claimed she owed the money for having left in advance of her lease’s expiration, though she had received written permission to leave. And the company suing her was not Sawyer, but one whose name she didn’t recognize: JK2 Westminster L.L.C.

     

     

    Warren was raising three children alone while taking classes for a bachelor’s degree in health care administration, and she disregarded the summons at first. But JK2 Westminster’s lawyers persisted; two more summonses followed. In April 2014, she appeared without a lawyer at a district-court hearing. She told the judge about the approval for her move, but she did not have a copy of the form the manager had signed. The judge ruled against Warren, awarding JK2 Westminster the full sum it was seeking, plus court costs, attorney’s fees and interest that brought the judgment to nearly $5,000. There was no way Warren, who was working as a home health aide, was going to be able to pay such a sum. “I was so desperate,” she said.

     

     

     

    If the case was confounding to Warren, it was not unique. Hundreds like it have been filed over the last five years by JK2 Westminster and affiliated businesses in the state of Maryland alone, where the company owns some 8,000 apartments and townhouses. Nor was JK2 Westminster quite as anonymous as its opaque name suggested. It was a subsidiary of a large New York real estate firm called Kushner Companies, which was led by a young man whose initials happened to be J.K.: Jared Kushner.

     

     

    In August 2012, a Kushner-led investment group bought 5,500 multifamily units in the Baltimore area with $371 million in financing from Freddie Mac, the government-backed mortgage lender — another considerable bargain. Two years later, Kushner Companies picked up three more complexes in the Baltimore area for $37.9 million. Today, Westminster Management, Kushner Companies’ property-management arm, lists 34 complexes under its control in Maryland, Ohio and New Jersey, with a total of close to 20,000 units.

     

    Kushner’s largest concentration of multifamily units is in the Baltimore area, where the company controls 15 complexes in all — which, if you assume three residents per unit, could be home to more than 20,000 people. All but two of the complexes are in suburban Baltimore County, but they are only “suburban” in the most literal sense. They sit along arterial shopping strips or highways, yet they are easy to miss — the Highland Village complex, for example, is beside the Baltimore-Washington Parkway, but the tall sound barriers dividing it from the six-lane highway render its more than 1,000 units invisible to the thousands traveling that route every day.

     

    At the time of the 2012 Baltimore purchase, Kushner raved about the promise of the low-end multifamily market. “It’s proven over the last few years to be the most resilient asset class, and at the end of the day, it’s a very stable asset class,” he told Multifamily Executive. He said things were proceeding well in the Midwestern complexes he purchased a year earlier. “It was a lot of construction and a lot of evictions,” he said. “But the communities now look great, and the outcome has been phenomenal.”

    Awesome!

    Meanwhile, back to Warren…

    Kamiia Warren still had not paid the $4,984.37 judgment against her by late 2014. Three days before Christmas that year, JK2 Westminster filed a request to garnish her wages from her in-home elder-care job. Five days earlier, Warren had gone to court to fill out a handwritten motion saying she had proof that she was given permission to leave Cove Village in 2010 — she had finally managed to get a copy from the housing department. “Please give me the opportunity to plead my case,” she wrote. But she did not attach a copy of the form to her motion, not realizing it was necessary, so a judge denied it on Jan. 9, on the grounds that there was “no evidence submitted.”

     

    The garnishing started that month. Warren was in the midst of leaving her job, but JK2 Westminster garnished her bank account too. After her account was zeroed out, a loss of about $900, she borrowed money from her mother to buy food for her children and pay her bills. That February — five years after she left Cove Village — Warren returned to court, this time with the housing form in hand, asking the judge to halt garnishment. “I am a single mom of three and my bank account was wiped clean by the plaintiff,” she pleaded in another handwritten request. “I cannot take care of my kids when they snatch all of my money out of my account. I do not feel I owe this money. Please have mercy on my family and I.” She told me that when she called the law office representing JK2 Westminster that same day from the courthouse to discuss the case, one of the lawyers told her: “This is not going to go away. You will pay us.”

     

    The judge denied Warren’s request without explanation. And JK2 Westminster kept pressing for the rest of the money, sending out one process server after another to present Warren with legal papers. Finally, in January 2016, the court sent notice of a $4,615 lien against Warren — a legal claim against her for the remaining judgment. Warren began to cry as she recounted the episode to me. She said the lien has greatly complicated her hopes of taking out a loan to start her own small assisted-living center. She had gone a couple of years without a bank account, for fear of further garnishing. “It was just pure greed,” she said. “It was unnecessary.” I asked why she hadn’t pushed harder against the judgment once she had the necessary evidence in hand. “They know how to work this stuff,” she replied. “They know what to do, and here I am, I don’t know anything about the law. I would have to hire a lawyer or something, and I really can’t afford that. I really don’t know my rights. I don’t know all the court lingo. I knew that up against them I would lose.”

     

    A search for “JK2 Westminster” in the database of Maryland’s District Court system brings back 548 cases in which it is the plaintiff — and that does not include hundreds of other cases that have been filed in the name of the company’s individual complexes.

     

    In the cases that Tapper has brought to court on behalf of JK2 Westminster and individual Kushner-controlled companies, there is a clear pattern of Kushner Companies’ pursuing tenants over virtually any unpaid rent or broken lease — even in the numerous cases where the facts appear to be on the tenants’ side. Not only does the company file cases against them, it pursues the cases for as long as it takes to collect from the overmatched defendants — often several years. The court docket of JK2 Westminster’s case against Warren, for instance, spans more than three years and 112 actions — for a sum that amounts to maybe two days’ worth of billings for the average corporate-law-firm associate, from a woman who never even rented from JK2 Westminster. The pursuit is all the more remarkable given how transient the company’s prey tends to be. Hounding former tenants for money means paying to send out process servers who often report back that they were unable to locate the target. This does not deter Kushner Companies’ lawyers. They send the servers back out again a few months later.

     

    In March 2009, Joan Beverly, a probation agent, signed the lease for her daughter, Lennettea, for a unit at Dutch Village, a complex on the northern edge of Baltimore. Lennettea moved out a year later, several months before her lease was up. Kushner Companies bought Dutch Village more than two years later. In December 2012, JK2 Westminster filed suit in Baltimore County District Court against Beverly, seeking $3,810.16 — several months of rent it said it was owed, plus about $1,000 in repair costs, including $10 for “failure to return laundry room card.”

     

    That February, Lennettea filed a written court notice explaining that her mother, who was dying of pancreatic cancer, was “in terminal hospice care and is not eligible to work.” She added by way of supporting evidence a letter from the hospice provider to Joan Beverly’s bank, explaining her and her husband’s late mortgage payments on their home: “There has been added financial stress because Mrs. Beverly is very ill at this time.” But JK2 Westminster persisted in seeking a hearing on the suit. In March, a district court judge found in favor of the company — a total judgment against Joan of more than $5,500.

     

    Joan died two weeks later. Her husband, Tyrone Beverly, a retired longshoreman, requested that the judgment against his deceased wife be removed but was denied. The case remains open in the court database. Tyrone, who was married to Joan for 32 years, told me that he had assumed the judgment had been dismissed and was unaware that it was still listed as awaiting payment. “They just didn’t treat us fair,” he said.

     

    Over all, about nine out of every 10 cases brought by JK2 Westminster that I surveyed resulted in judgments against the defendants, who often did not appear in person for the hearings — and if they did, almost never had legal representation. How could it possibly be worth Kushner Companies’ while to pursue hundreds of people so aggressively over a few thousand dollars here and there? After all, the pursuit itself cost money. And it wasn’t happening just in Baltimore — Doug Wilkins, a lawyer in Toledo who has represented some of the complexes bought there by Kushner, told me the company is seeking far more monetary judgments than did previous owners.

     

    Matthew Hertz, whose Bethesda, Md., firm represents landlords and tenants in similar cases, explained to me that there is a logic behind such aggressive tactics. The costs of the pursuit are not as high as you might imagine, he said — people are not that hard to find in the age of cellphones and easily accessible databases. “If I give my process server a name and phone number, it’s generally enough to trace you,” he said. “If I have a date of birth and Social Security number, it’s even easier.” The legal costs can be billed to the defendant as attorney’s fees, if the terms of the lease allow. And garnishing wages is relatively easy to do by court order, assuming the defendant has wages to garnish.

     

    The Highland Village complex, along the Baltimore-Washington Parkway, is one of Kushner Companies’ largest, a vast maze of lanes and courts lined with rows of short brick-and-siding-fronted homes. Like the other Kushner complexes I visited in Baltimore’s southern and eastern suburbs, it is situated in what was once a predominantly white working-class community, within reasonable commuting distance of the harbor and industrial plants, now defunct, like Bethlehem Steel. In recent decades, many black transplants from the city and Hispanic immigrants have arrived as well, and Highland Village is an unusually integrated place.

     

    The complex, like the others I saw, seemed designed to preclude neighborliness — most of the townhouses lack even the barest stoop to sit out on, and at least one complex has signs forbidding ball-playing (“violators will be prosecuted”). At another complex, kids had drawn a rectangle on the side of a storage shed in lieu of a hoop for their basketball game. The only meeting points at many of the complexes are the metal mailbox stands, the Dumpsters and the laundry room. And the only thing that united many of the residents I spoke to, it seemed, was resentment of their landlord.

     

    They complained about Westminster Management’s aggressive rent-collection practices, which many told me exceeded what they had experienced under the previous owners. Rent is marked officially late, they said, if it arrives after 4:30 p.m. on the fifth day of the month. But Westminster recently made paying the rent much more of a challenge. Last fall, it sent notice to residents saying that they could no longer pay by money order (on which many residents, who lack checking accounts, had relied) at the complex’s rental office and would instead need to go to a Walmart or Ace Cash Express and use an assigned “WIPS card” — a plastic card linked to the resident’s account — to pay their rent there. That method carries a $3.50 fee for every payment, and getting to the Walmart or Ace is difficult for the many residents without cars.

     

    The worst troubles may have been those described in a 2013 court case involving Jasmine Cox’s unit at Cove Village. They began with the bedroom ceiling, which started leaking one day. Then maggots started coming out of the living-room carpet. Then raw sewage started flowing out of the kitchen sink. “It sounded like someone turned a pool upside down,” Cox told me. “I heard the water hitting the floor and I panicked. I got out of bed and the sink is black and gray, it’s pooling out of the sink and the house smells terrible.”

     

    Cox stopped cooking for herself and her son, not wanting food near the sink. A judge allowed her reduced rent for one month. When she moved out soon afterward, Westminster Management sent her a $600 invoice for a new carpet and other repairs. Cox, who is now working as a battery-test engineer and about to buy her first home, was unaware who was behind the company that had put her through such an ordeal. When I told her of Kushner’s involvement, there was a silence as she took it in.

     

    Very few of the complex residents I met, even ones who had been pursued at length in court by JK2 Westminster, had any idea that their rent and late fees were going to the family company of the president’s son-in-law. “That Jared Kushner?” Danny Jackson, a plumber in his 15th year living at Harbor Point Estates, exclaimed. “Oh, my God. And I thought he was the good one.”

     

    At the Carroll Park complex, I met Mike McHargue, a private investigator, and his girlfriend, Patricia Howell. “They’re nothing but slumlords,” Howell told me of Westminster Management. “They take everyone’s money.” When I asked if they knew who was behind the company, they said they did not. “Oh, really?” Howell said when I mentioned Kushner’s name. “Oh, really. And I’m a Trump supporter.”

     

    Jared Kushner stepped down as chief executive of Kushner Companies in January. But he remains a stakeholder in the company — his share of company-related trusts is estimated to be worth at least $600 million — and the company says it has no intention of selling off its multifamily holdings. (JK2 Westminster was formally dissolved in December, but Kushner Companies still owns the complexes through other entities; lawsuits against tenants are now typically filed in the names of the complexes themselves.) Because Kushner retains his interest in the complexes, the White House told The Baltimore Sun in February that he would recuse himself from any policy decisions about Section 8 funding, as many of his tenants rely on it for their rent. But even as Kushner now busies himself with his ever-expanding White House portfolio, his company is carrying on its vigorous efforts in court.

    On a related note, here’s an article I published earlier this month: Kushner Companies Seen Hawking Shady U.S. Visa Buying Residency Program to Wealthy Chinese

  • "Something's Breaking" – Yuan Suddenly Spikes To 2-Month Highs

    Traders in Asia are bemused as offshore Yuan suddenly spikes by the most in 2 months (following dollar’s post-Fed-Minutes breakdown) to 2-month highs…

    It seems The Fed’s potentially dovish realisation that data-dependence is going to hold them back from their plans to hike rates no matter what is rippling through the world’s risk markets as Yuan spikes suddenly and dramatically in Asia trading…

    Sending offshore Yuan to 2-month highs..

     

    As we warned earlier it seems The National Team are active in stocks…

     

    Rebounding once again even as Iron ore plumbs new depths.

    As one Hong Kopng based trader said “something’s breaking!”

  • Comey 'Friend' Warns Trump "If I Were You, I'd Be Scared"

    First it was anonymous colleagues, then his dad, and now it's a 'friend' of Jim Comey that CNN reports the fired FBI director has a story to tell, adding that he would be scared if he were President Trump.

    As The Hill reports, Benjamin Wittes, who describes himself as a Comey confidant, said on CNN when asked how Comey was doing.

    "He's going to be fine. He's not somebody who spends time feeling sorry for himself,"

     

    "I thought it was interesting and very telling that he declined an opportunity to tell his story in private. He clearly wants to do it in a public setting,"

     

    "I think that's a reflection of the fact that this is a guy with a story to tell. I think if I were Donald Trump that would scare me a lot."

    This comes days after a report said Comey is expected to testify that he believes Trump was deliberately trying to meddle in the FBI's investigation of Russian interference in the presidential election.

    One wonders how long until Ray Dalio, Comey's former boss, and until recently a fan of Donald Trump, is also asked to comment (off the record) on the upcoming Pay Per View show  of the century, as Comey finally sits down to "clear the air."

  • What Is Causing China's Yield Curves To Invert: UBS Answers

    Something strange is taking place in China, and we are not talking about the largely optical, mostly irrelevant first downgrade of China by Moody’s since 1989 (which still managed to unleash diplomatic hell in Beijing), and in which the rating agency simply admitted what everyone else already knew about the 300% debt/GDP economy.

    The bigger issue, as we noted previously, is that both the short-term

     

    and conventional Chinese funding market appears to be breaking…

    … because as of this week, not only has the one-year Shanghai Interbank Offered Rate, or SHIBOR, exceeded the Loan Prime Rate for the first time ever, meaning Chinese banks’ cost of borrowing is now above the rate they charge customers, but the Chinese government bond yield curve has inverted in not just one, but two places, with both the 3s5s and the 7s10s negative.

     

    The question everyone wants answered is why. One attempt at just that, came today from UBS which first give the blow by blow of how we got there:

    As market concerns about financial regulation continued in the first half of May, bond yields kept rising, with the 10-year CGB yield reaching 3.69% on 10 May. The People’s Bank of China (PBoC) renewed MLFs and increased net liquidity injection through OMOs. April economic data, such as FAI released by NBS, came in weaker than market expectations. More importantly, there were media reports that the China Banking Regulatory Commission (CBRC) showed a soft tone in requirements for banks to reach standards. Besides, the central bank’s statement on strengthening coordination in financial regulations eased market concerns about financial regulation.

    As a result of these factors, the back end of the yield curve declined while the front end to continued rising moderately. According to Chinabond yield curves, as of 19 May 2017, 1-year, 5-year and 10-year CGB yields were 3.48%, 3.68% and 3.63%, respectively, up 9bp, 20bp and 7bp compared with 5 May 2017. Yields of 1-year, 5-year and 10-year policy financial bonds (CFBs; we use the bonds issued by the Export and Import Bank of China as examples) were 4.11%, 4.45% and 4.51%, respectively, up 21bp, 10bp and 6bp compared with 5 May 2017.

    UBS notes that from the historical data of term spreads, we can see that inversion of 7-year and 10-year has happened more often, which could be attributed to better liquidity in the secondary market for 10-year bonds, but the recent greater than 10bp spread between 7-year and 10-year yields is still the first time that has happened over the past few years. The inverted 3s/10s and 5s/10s curve is also rare to see.

    And while liquidity may be a factor, UBS concedes that liquidity gaps have always existed and may not be the main reason for the recent curve inversion. As such, the Swiss bank admits that “we need to consider some other factors.

    Below are some of the incremental factors besides liquidity:

    • In terms of CGB issuance in the primary market, auction results in May showed that auction rates were all higher than market expectations, except for the 50-year CGB auction, which came in lower than the market’s expectation. Also, the spread between auction results and market expectations was larger for the less liquid tenors.
    • That indicates that during weak market sentiment, a negative feedback loop formed between the primary market and secondary market. Besides, from an allocation demand perspective, insurance companies have shown increased demand for CGBs in recent months, in addition to banks, the major buyers of CGBs, which may provide support to long-tenor bonds.

    More importantly, however, UBS notes that the inverted curve also reflects a contradiction between market expectations on policies and economic fundamentals.

     On one hand, the slowdown of economic growth may prevent the back end of the yield curve from further going up. On the other hand, financial institutions’ funding costs have kept rising but the financing costs for the real economy measured by loan rates have not risen that much. And investors can hardly expect the monetary policy to ease in the current circumstances.

    • We think the rise in financial institutions’ funding costs shows their intention to maintain the current asset/liability scale. From this perspective, the deleveraging process may continue for a longer period, while the change in economic fundamentals has not been enough to trigger a reversal of the monetary policy tone. We think in the short term, the yield curve is more likely to repair by having the back end go up again when the gap between market expectations and implementation of financial regulations appears again. Among long-tenor CGBs, the spread between 7-year and 10-year yields is quite large, which has made the relative value of 7-year CGBs rise much higher, in our view. We think when market sentiment calms temporarily, the yield of 7-year CGBs may adjust downward and provide a tactical trading opportunity. However, we expect the 10-year CGB yield to fluctuate at a high level, with a short-term cap around 3.7-3.8%. Although economic fundamentals may put some limit on the rise of the 10-year level, we don’t think there is much room for downside adjustment. Over a longer period, considering the progress of deleveraging, we think investors still need to pay attention to the renewal of banks’ funds that are under management of non-bank financial institutions in H2.
    • Regarding the front end of the yield curve, although we think room for money market rates to go lower is limited in the short term, market expectations about liquidity conditions could stabilize, given PBoC’s recent tone, and that may create room for the front end of the CGB curve to go a bit lower. Over a longer period, we think if a more apparent economic slowdown happens in H2 and forces monetary policy to adjust, a larger opportunity for the front end to move down may appear.

    The above not only why the CGB curve is inverted, but also why SHIBOR1Y is now above the LPR.

    And while that may answer why both the CGB and the short-term funding yield curves are inverted, another, just as pressing question emerges: assuming UBS is right, and these yield oddities are merely “contradictions” between market reality and hopes, what happens when this divergence between fundamentals and expectations converges, and more importantly, what will such a mean reversion look like for China’s already bizarrely trading financial assets.

  • Angry China Slams Moodys For Using "Inappropriate Methodology"

    The market may have long since moved on from Moody’s downgrade of China to A1 from Aa3 (by now even long-only funds have learned that in a world with $18 trillion in excess liquidity, the opinion of Moodys is even more irrelevant), but for Beijing the vendetta is only just starting, and in response to Tuesday’s downgrade, China’s finance ministry accused the rating agency of applying “inappropriate methodology” in downgrading China’s credit rating, saying the firm had overestimated the difficulties faced by the Chinese economy and underestimated the country’s ability to enhance supply-side reforms.

    In other words, Moody’s failed to understand that 300% debt/GDP is perfectly normal and that China has a very explicit exit strategy of how to deal with this unprecedented debt load which in every previous occasion in history has led to sovereign default.

    The Ministry of Finance reaction came after Moody’s first, and very, very long overdue, downgrade of China since 1989 citing concerns about risks from China’s relentlessly growing debt load as shown below.

    “China’s economy started off well this year, which shows that the reforms are working,” the ministry said in a statement on its website.  Actually, it only shows that China had injected a record amount of loans into the economy at the start of the year, and nothing else. And now that the credit impulse is fading, the hangover has arrived.

     

    Moody’s on Wednesday also downgraded the ratings of 26 Chinese government-related non-financial corporate and infrastructure issuers and rated subsidiaries by one notch. It also downgraded the ratings of several domestic banks, including the Agricultural Bank of China Limited’s long-term deposit rating from A1 to A2.  It also eventually downgraded Hong Kong and said credit trends in China will continue to have a significant impact on Hong Kong’s credit profile due to close economic, financial and political ties with the mainland.

    So how did China defend its position? The same way US companies fabricate their own numbers to confuse shareholders: with “pro forma” arguments.

    For example Moody’s noted that the importance Chinese authorities have attached to maintaining robust growth would result in sustained policy stimulus, and such government spending would contribute to rising debt across the economy. “We expect the government’s direct debt burden to rise gradually toward 40 percent of GDP by 2018 and closer to 45 percent by the end of the decade,” Moody’s noted.

    To this, the MOF responded that government bonds reached 27.33 trillion yuan ($3.97 trillion) at the end of 2016, or about 37% of the country’s GDP. The proportion is much lower than the 60% picket line delimited by the EU, the ministry said.  Liu Xuezhi, a senior analyst at the Bank of Communications, said that the proportion of government bonds to GDP has been continuously dropping since peaking in 2013, largely due to the government efforts to manage debt.

    “I think Moody’s reasons are debatable,” he said.

    Of course, what the MOF forgot to mention is the roughly 200% in corporate debt issued in large part by entities that are State-owned enterprises, and which the government for mostly refuses to go bankrupt over fears of mass riots, civil disobedience and even war.  As a result virtually all of China’s corporate debt is effectively sovereign.

    That did not prevent China from spinning more propaganda.

    Zheng Xinye, associate dean of the School of Economics at the Renmin University of China, also told the Global Times on Wednesday that the government has taken effective measures, such as bond swaps and perfecting the issuance and management system of local government debt, to rein in bond risks.  Liu added that China’s fiscal revenue has been rising since 2009. “Besides, the Chinese government has income channels which other countries don’t, such as land transfer money and State assets. Therefore, I don’t think China would be facing serious financial pressure, at least not in the next few years,” he told the Global Times on Wednesday.

    Zheng also said that the government wouldn’t need to use fiscal measures to stimulate growth, as the effects of supply-side reforms would sustain the economy’s momentum.  He may have even said it with a straight face.

    Additionally, China took offense at Moody’s forecast that China’s growth will slow to 5% in five years, because of a smaller working-age population and continuing production slowdown. 

    To this, Liu said the chances are very slim for China’s economy to slip to 5 percent in the next five years. “I believe China’s GDP growth will remain above 6.5 percent at the end of 2020, as China has abundant room for policy adjustments to support economic growth,” Liu said. It has even more abundant room to goalseek its data to whatever it wants, however, without the benefit of “creating” 40% of GDP in the form of new credit, China’s economy will implode.

    Zheng disagreed, and said the economy has not shown any signs of sliding.

    One place where China’s apparatchiks were right is that Moody’s downgrade would hurt overseas investor confidence in the Chinese market or collaborations with domestic companies.

    “It would also make it more difficult for domestic companies to seek financing in overseas markets,” Liu noted.  But Liu said domestic financial markets would not be affected as much, because they’re not entirely open. And for a good, if scary, explanation of what happens as China’s debt issuance shift domestically, read this morning Bloomberg piece “China’s Downgrade Could Lead to a Mountain of Debt.”

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  • If At First You Don't Succeed… A Timeline Of Elon Musk's Long List Of Failures

    At first glance, it’s easy to be impressed by Elon Musk’s impressive resume. He’s shooting for the stars with SpaceX, changing the future of transportation with Tesla, Hyperloop, and The Boring Company, and he’s already had a profound impact on the e-commerce and payments sectors through Paypal. It’s no coincidence that most of these are $1 billion+ companies. But, as Visual Capitalist's Jeff Desjardins notes, focusing only on his successes provides a superficial view of the man. To get the full perspective on his career, it is much more interesting to look at the failures and lows he has experienced. These are the moments when most people would have likely given up.

    FAILING OFTEN

    As every entrepreneur knows, any business venture can be upended by failures at any moment – and it is how one bounces back from those failures that counts. Today’s infographic from Kickresume shows Musk’s struggles and failures throughout his career, and how he persevered to become a modern business icon.

    Courtesy of: Visual Capitalist

    As the ever-quotable Winston Churchill once said:

    Success is not final, failure is not fatal: it is the courage to continue that counts. – Winston Churchill

    After being ousted out of his own company, having many rockets go bust, and fighting to keep Tesla and SpaceX from going bankrupt, Musk kept pushing forward with courage.

    WHAT WE CAN LEARN

    Entrepreneurs hold people like Steve Jobs, Elon Musk, and Richard Branson in high reverence. Sometimes, we even put them on a pedestal, thinking we could only dream of making such a profound impact on the world. However, this is obviously a one dimensional view. These figures are not superhuman, and the reality is that they’ve all experienced tragic failures throughout the course of their careers. They’ve been disheartened, but they bounced back. We have to recognize that success in business isn’t what it appears to be on magazine covers and headlines. Failure is an everyday part of doing business, and it plagues almost every entrepreneur in some shape or form. The difference is in how you react to it.

    …and of course, it helps to be on the right side of government handouts too…

  • Did Trump's Islam Speech In Saudi Arabia Pave The Way For America's Next Big War

    Authored by Darius Shahtahmasebi via TheAntiMedia.org,

    The American public is most likely unaware of the giant stranglehold Saudi Arabia has on the U.S. government. Saudi Arabia uses its vast riches to manipulate the U.N., which explains how a country that brutally oppresses its female population was recently gifted a seat on the organization’s women’s rights commission. The Islamic Kingdom also wields incredible control over international media and has arguably had an increasingly unwelcome position of power in America’s foreign policy decision-making. As such, Donald Trump’s political career, in part, rests on appeasing his Saudi Arabian counterparts.

    And appeasing the Saudis is exactly what Trump has done. Trump’s speech regarding Islam was delivered to the leaders of 55 Muslim-majority nations, including Saudi Arabia. However, he conveniently ignored the troves of evidence that show Saudi Arabia directly sponsors the terror groups al-Qaeda and ISIS – two groups the U.S. claims to be at war with — as well as the fact that Saudi Arabia has been directly implicated in the 9/11 terror attacks. Instead, Donald Trump framed the entire issue of radicalization as a problem that rests with Iran. As he stated in Riyadh:

    “But no discussion of stamping out this threat would be complete without mentioning the government that gives terrorists all three—safe harbor, financial backing, and the social standing needed for recruitment. It is a regime that is responsible for so much instability in the region. I am speaking of course of Iran. From Lebanon to Iraq to Yemen, Iran funds, arms, and trains terrorists, militias, and other extremist groups that spread destruction and chaos across the region. For decades, Iran has fueled the fires of sectarian conflict and terror.

     

    It is a government that speaks openly of mass murder, vowing the destruction of Israel, death to America, and ruin for many leaders and nations in this room.”

    Iran’s prime enemies are actually Sunni-dominated terror groups such as al-Qaeda and ISIS. The Islamic Republic and its proxies have been heavily engaged in fighting these terror groups in Syria. If eradicating terrorism was a priority for the United States and Saudi Arabia, Iran would be a natural ally considering Iran almost all but defeated ISIS in Iraq.

    Yet, Trump continued:

    "Among Iran’s most tragic and destabilizing interventions have been in Syria. Bolstered by Iran, Assad has committed unspeakable crimes, and the United States has taken firm action in response to the use of banned chemical weapons by the Assad regime—launching 59 tomahawk missiles at the Syrian air base from where that murderous attack originated.”

    While many analysts may focus on how Trump has gone from the most Islamophobic president ever elected to now omitting the words “radical Islamic terrorism” from his speech on Islam, these analysts continue to gloss over the fact that the entire speech appears to have been a geopolitical gesture to please Saudi Arabia and its allies. As the Iranian Foreign Ministry noted, Trump is no longer concerned with Islamophobia but what Iran has coined as “Iranophobia.”

    Iran is Saudi Arabia’s regional archrival. The two countries are fighting an enormous proxy war in Syria because Saudi Arabia views an Iranian-aligned government as a threat to its economic interests. Saudi Arabia is also currently bombing Yemen into oblivion as fears of a Shi’a led government capable of aligning itself with Tehran became a probable reality in 2015.

    Most hypocritical, however, was the following statement:

    Until the Iranian regime is willing to be a partner for peace, all nations of conscience must work together to isolate Iran, deny it funding for terrorism, and pray for the day when the Iranian people have the just and righteous government they deserve.

    Even establishment outlets such as the BBC could not allow this statement to go unchecked. The BBC stated:

    “And amongst several cynical reactions to the speech from around the region on social media, some have pointed out that here in Saudi Arabia women are forbidden to drive and there are no parliamentary elections. In Iran, the country accused by Mr Trump of being behind much of the current terrorism across the Middle East, they have just had a free election and women are free to drive. [emphasis added]

    Iran’s recent elections saw one of the heaviest turnouts in the country’s history, much higher than that of the United States. It is technically one of the most democratic countries in the region. While Iran would not be considered greatly democratic by Western standards, this is a testament to how undemocratic Iran’s rivals in the region are, including Saudi Arabia. Even prisoners were allowed to vote in Iran, something so-called democratic countries such as New Zealand disallow.

    Despite all of this “Iranophobic” sentiment, it is also worth noting that Iran’s alleged nuclear program is rarely discussed in the international arena anymore. This is because the Trump administration is well aware that the Iranian nuclear deal reached in 2015 is working – and there is no current nuclear threat from Iran. In this context, the U.S. government has to look for alternative modes of hyping up an Iranian threat to justify a massive arms deal.

    And yet, spearheaded by Trump, the Arab world has just announced a new military pact that will directly confront Iran. Called the “Riyadh Declaration,” the pact was signed by representatives from 55 Islamic nations that have vowed “to combat terrorism in all its forms, address its intellectual roots, dry up its sources of funding and to take all necessary measures to prevent and combat terrorist crimes in close cooperation among their states.”

    How can a coalition, led by Saudi Arabia, combat terrorism and extremism when Saudi Arabia’s Wahhabist philosophy is responsible for most of today’s terrorism-related problems? As noted by the Independent:

    “The state systematically transmits its sick form of Islam across the globe, instigates and funds hatreds, while crushing human freedoms and aspiration…The jaw simply drops. Saudi Arabia executes one person every two daysRaif Badawi, a blogger who dared to call for democracy, was sentenced to 10 years and 1,000 lashes. Last week, 769 faithful Muslim believers were killed in Mecca where they had gone on the Hajj. Initially, the rulers said it was ‘God’s will’ and then they blamed the dead.”

    The military pact will also include an “Islamic Military Coalition,” which will “provide a reserve force of 34,000 troops to support operations against terrorist organizations when needed.”

    The original text of the document was heavily infatuated with Iran but has since been amended. The original text also said these troops would be deployed to Syria and Iraq “when needed,” which is — again — clearly aimed at countering Iranian influence as Iran is heavily tied to both countries. Saudi Arabia has already expressed its intention to send troops into Syria multiple times before, with the exclusive goal of ensuring that “liberated areas [do] not fall under the control of Hizballah, Iran or the regime.”

    The United States, Britain, and associated forces are creeping into Syria as we speak, directly paving the way for an all-out confrontation with Syrian troops in al-Tanf. Just last week, the U.S. military bombed these troops, even though they are directly backed by Iran (and most likely Russia, too).

    This is no secret to the mainstream media. The Washington Post just released an article hours ago entitled “How Trump could deal a blow to Iran — and help save Syria,” with the conclusion that the battle for al-Tanf  is “a fight that the United States cannot and should not avoid.” Dealing a strategic blow to Iran and Syria will only empower ISIS given that they are the most heavily engaged entities fighting the terror groups in Syria.

    The Trump administration’s seeds are being sown in tandem with the corporate media. Trump’s speech had nothing to do with radical Islam. It was written by Stephen Miller, the “architect” of Donald Trump’s travel ban (a policy that also vehemently targeted Iran, among other countries).

    Selling a war with Iran to the American public may be difficult considering the Islamic nation twice elected a reformist who is open to making diplomatic deals with the United States. However, selling a war that will take place inside Syria is somewhat less problematic, even if that war is against the Syrian government, as the American public is easily manipulated by Assad’s alleged war crimes. As Iran is Syria’s closest ally, it will be easily drawn into a confrontation.

    If Saudi Arabia’s coalition of anti-Iranian Muslim nations illegally joins this battle arena, the resulting war will be catastrophic.

  • WannaCry Attackers Have Links To North Korea's Lazarus Group

    Cybersecurity researchers at Symantec say they've found linkes between the WannaCry Ransomware attackers was likely carried out by a hacking group with ties to North Korea.

    In a blog post, Symantec said the “Tools and infrastructure used in the WannaCry ransomware attacks have strong links to Lazarus, the group that was responsible for the destructive attacks on Sony Pictures and the theft of $81 million from the Bangladesh Central Bank.”

    Here's a summary of links provided by Symantec:

    • Following the first WannaCry attack in February, three pieces of malware linked to Lazarus were discovered on the victim’s network: Trojan.Volgmer and two variants of Backdoor.Destover, the disk-wiping tool used in the Sony Pictures attacks.
    • Trojan.Alphanc, which was used to spread WannaCry in the March and April attacks, is a modified version of Backdoor.Duuzer, which has previously been linked to Lazarus.
    • Trojan.Bravonc used the same IP addresses for command and control as Backdoor.Duuzer and Backdoor.Destover, both of which have been linked to Lazarus.
    • Backdoor.Bravonc has similar code obfuscation as WannaCry and Infostealer.Fakepude (which has been linked to Lazarus).
    • There is shared code between WannaCry and Backdoor.Contopee, which has previously been linked to Lazarus.

    Symantec discovered that the WannaCry attackers used some of the same hacking tools that were previousky used in other Lazarus Group attacks. There are also, the group reported, “a number of links between WannaCry itself and Lazarus.”

    The WannaCry ransomware, for example, shares some code with a piece of malware that has previously been linked to Lazarus.

    Symantec also found that the WannaCry attackers used some of the same network infrastructure as the Lazarus Group. “There are a number of crossovers seen in the C&C servers used in the WannaCry campaigns and by other known Lazarus tools.”

    Beginning a week ago Friday, the WannaCry virus infected thousands of computers around the world, threatening to destroy users' data unless a ransom was paid in bitcoin. Ultimately, the group received less than $100,000, and most of the data were destroyed.

  • The Republic Has Fallen: The Deep State's Plot To Take Over America Has Succeeded

    Submitted by John Whitehead via The Rutherford Institute,

    No doubt about it.

    The coup d’etat has been successful.

    The Deep State – a.k.a. the police state, a.k.a. the military industrial complex – has taken over.

    The American system of representative government has been overthrown by a profit-driven, militaristic corporate state bent on total control and global domination through the imposition of martial law here at home and by fomenting wars abroad.

    When in doubt, follow the money trail.

    It always points the way.

    Every successive president starting with Franklin D. Roosevelt has been bought—lock, stock and barrel—and made to dance to the tune of the Deep State.

    Enter Donald Trump, the candidate who swore to drain the swamp in Washington DC.

    Instead of putting an end to the corruption, however, Trump has paved the way for lobbyists, corporations, the military industrial complex, and the Deep State to feast on the carcass of the dying American republic.

    Just recently, for instance, Trump agreed to sell Saudi Arabia more than $110 billion in military weapons.

    Meanwhile, Trump—purportedly in an effort to balance the budget in 10 years—wants to slash government funding for programs for the poor, ranging from health care and food stamps to student loans and disability payments.

    The military doesn’t have to worry about tightening its belt, however. No, the military’s budget—with its trillion dollar wars, its $125 billion in administrative waste, and its contractor-driven price gouging that hits the American taxpayer where it hurts the most—will continue to grow, thanks to Trump.

    This is how you keep the Deep State in power.

    The rich will get richer, the poor will get poorer, the military will get more militaristic, America’s endless wars will get more endless, and the prospect of peace will grow ever dimmer.

    As for the terrorists, they will keep on being played for pawns as long as Saudi Arabia remains their breeding ground and America remains the source of their weapons, training and know-how.

    Follow the money.  It always points the way.

    As Bertram Gross noted in Friendly Fascism: The New Face of Power in America,evil now wears a friendlier face than ever before in American history.”

    Writing in 1980, Gross predicted a future in which he saw:

    …a new despotism creeping slowly across America. Faceless oligarchs sit at command posts of a corporate-government complex that has been slowly evolving over many decades. In efforts to enlarge their own powers and privileges, they are willing to have others suffer the intended or unintended consequences of their institutional or personal greed. For Americans, these consequences include chronic inflation, recurring recession, open and hidden unemployment, the poisoning of air, water, soil and bodies, and, more important, the subversion of our constitution. More broadly, consequences include widespread intervention in international politics through economic manipulation, covert action, or military invasion

    We’ve been losing our freedoms so incrementally for so long—sold to us in the name of national security and global peace, maintained by way of martial law disguised as law and order, and enforced by a standing army of militarized police and a political elite determined to maintain their powers at all costs—that it’s hard to pinpoint exactly when it all started going downhill, but we’re certainly on that downward trajectory now, and things are moving fast.

    The “government of the people, by the people, for the people” has perished.

    It will not be revived or restored without a true revolution of values and a people’s rebellion the likes of which we may not see for a very long time.

    America is a profitable business interest for a very select few, and war—wars waged abroad against shadowy enemies and wars waged at home against the American people—has become the Deep State’s primary means of income.

    After all, war is big business.

    In order to maintain a profit margin, one would either have to find new enemies abroad or focus on fighting a war at home, against the American people, and that’s exactly what we’re dealing with today.

    • Local police transformed into a standing army in the American homeland through millions of dollars’ worth of grants to local police agencies for military weapons, vehicles, training and assistance.
    • The citizenry taught to fear and distrust each other and to welcome the trappings of the police state.

    Had the government tried to ram such a state of affairs down our throats suddenly, it might have had a rebellion on its hands. Instead, the American people have been given the boiling frog treatment, immersed in water that slowly is heated up—degree by degree—so that they’ve fail to notice that they’re being trapped and cooked and killed.

    “We the people” are in hot water now.

    As I make clear in my book Battlefield America: The War on the American People, the Constitution doesn’t stand a chance against a federalized, globalized standing army protected by legislative, judicial and executive branches that are all on the same side, no matter what political views they subscribe to: suffice it to say, they are not on our side or the side of freedom.

    From Clinton to Bush, then Obama and now Trump, it’s as if we’ve been caught in a time loop, forced to re-live the same thing over and over again: the same assaults on our freedoms, the same disregard for the rule of law, the same subservience to the Deep State, and the same corrupt, self-serving government that exists only to amass power, enrich its shareholders and ensure its continued domination.

    The republic has fallen to fascism with a smile.

    Elections will not save us.

    Learn the treacherous lessons of 2008 and 2016:  presidential elections have made a mockery of our constitutional system of government, suggesting that our votes can make a difference when, in fact, they merely serve to maintain the status quo.

    Don’t delay.

    Start now—in your own communities, in your schools, at your city council meetings, in newspaper editorials, at protests—by pushing back against laws that are unjust, police departments that overreach, politicians that don’t listen to their constituents, and a system of government that grows more tyrannical by the day.

    If you wait until 2020 to rescue our republic from the clutches of the Deep State, it will be too late.

  • Here Are The 66 Programs That Trump's Budget Eliminates

    President Trump's fiscal 2018 budget proposal would completely eliminate 66 federal programs, for a savings of $26.7 billion. 

    As The Hill reports, some of the programs would receive funding for 2018 as part of a phasing-out plan.

    Here are the programs the administration wants on the chopping block…

    Agriculture Department — $855 million

    • McGovern-Dole International Food for Education
    • Business-Cooperative Service
    • Rural Water and Waste Disposal Program Account
    • Single Family Housing Direct Loans

    Commerce Department — $633 million

    • Economic Development Administration
    • Manufacturing Extension Partnership
    • Minority Business Development Agency
    • National Oceanic and Atmospheric Administration Grants and Education

    Education Department — $4.976 billion

    • 21st Century Community Learning Centers
    • Comprehensive Literacy Development Grants
    • Federal Supplemental Educational Opportunity Grants
    • Impact Aid Payments for Federal Property
    • International Education
    • Strengthening Institutions
    • Student Support and Academic Enrichment Grants
    • Supporting Effective Instruction State Grants
    • Teacher Quality Partnership

    Energy Department — $398 million

    • Advanced Research Projects Agency—Energy
    • Advanced Technology Vehicle Manufacturing Loan Program and Title 17 Innovative Technology Loan Guarantee Program
    • Mixed Oxide Fuel Fabrication Facility

    Health and Human Services — $4.834 billion

    • Agency for Healthcare Research and Quality
    • Community Services Block Grant
    • Health Professions and Nursing Training Programs
    • Low Income Home Energy Assistance Program

    Homeland Security — $235 million

    • Flood Hazard Mapping and Risk Analysis Program
    • Transportation Security Administration Law Enforcement Grants

    Housing and Urban Development — $4.123 billion

    • Choice Neighborhoods
    • Community Development Block
    • HOME Investment Partnerships Program
    • Self-Help and Assisted Homeownership Opportunity Program Account

    Interior Department — $122 million

    • Abandoned Mine Land Grants
    • Heritage Partnership Program
    • National Wildlife Refuge Fund

    Justice Department — $210 million

    • State Criminal Alien Assistance Program

    Labor Department — $527 million

    • Migrant and Seasonal Farmworker Training
    • OSHA Training Grants
    • Senior Community Service Employment Program

    State Department and USAID — $4.256 billion

    • Development Assistance

    Earmarked Appropriations for Non-Profit Organizations

    • The Asia Foundation
    • East-West Center
    • P.L. 480 Title II Food Aid

    State Department, USAID, and Treasury Department — $1.59 billion

    • Green Climate Fund and Global Climate Change Initiative

    Transportation Department — $499 million

    • National Infrastructure Investments (TIGER)

    Treasury Department — $43 million

    Global Agriculture and Food Security Program

    Environmental Protection Agency — $493 million

    • Energy Star and Voluntary Climate Programs
    • Geographic Programs

    National Aeronautics and Space Administration — $269 million

    • Five Earth Science Missions
    • Office of Education

    Other Independent Agencies — $2.683 billion

    • Chemical Safety Board
    • Corporation for National and Community Service
    • Corporation for Public Broadcasting
    • Institute of Museum and Library Services

    International Development Foundations

    • African Development Foundation
    • Inter-American Foundation
    • Legal Services Corporation
    • National Endowment for the Arts
    • National Endowment for the Humanities
    • Neighborhood Reinvestment Corporation
    • Overseas Private Investment Corporation

    Regional Commissions

    • Appalachian Regional Commission
    • Delta Regional Authority
    • Denali Commission
    • Northern Border Regional Commission
    • U.S. Institute of Peace
    • U.S. Trade and Development Agency
    • Woodrow Wilson International Center for Scholars

  • Ron Paul On The Drug War: Will The Trump Administration OD On Authoritarianism?

    Authored by Ron Paul via The Ron Paul Institute for Peace & Proseprity,

    Last week Attorney General Jeff Sessions ordered federal prosecutors in drug cases to seek the maximum penalty authorized by federal mandatory minimum sentencing laws. Sessions’ order represents a setback to the progress made toward restoring compassion and common sense to the sentencing process over the past few years. Sessions’ action also guarantees that many nonviolent drug law offenders will continue spending more time in prison than murderers.

    Sessions’ support for mandatory minimums is no surprise, as he has a history of fanatical devotion to the drug war. Sessions’ pro-drug war stance is at odds with the reality of the drug war’s failure. Over forty years after President Nixon declared war on drugs, the government cannot even keep drugs out of prisons!

    As was the case with alcohol prohibition, the drug war has empowered criminal gangs and even terrorists to take advantage of the opportunity presented by prohibition to profit by meeting the continued demand for drugs. Drug prohibition enables these criminal enterprises to make profits far above the potential profits if drugs where legalized. Ironically, the so-called “law-and-order” politicians who support the drug war are helping enrich the very criminals they claim to oppose!

    The war on drugs also makes street drugs more lethal by incentivizing the creation of more potent and, thus, more dangerous drugs. Of course, even as Sessions himself admits, the war on drugs also leads to increased violence, as drug dealers cannot go to the courts to settle disputes among themselves or with their customers.

    Before 9/11, the war on drugs was the go-to excuse used to justify new infringements on liberty. For example, laws limiting our ability to withdraw, or even carry, large sums of cash and laws authorizing civil asset forfeiture were justified by the need to crack down on drug dealers and users. The war on drugs is also the root cause of the criminal justice system’s disparate treatment of minorities and the militarization of local police.

    The war on drugs is a war on the Constitution as well. The Constitution does not give the federal government authority to regulate, much less ban, drugs. People who doubt this should ask themselves why it was necessary to amend the Constitution to allow the federal government to criminalize drinking alcohol but not necessary to amend the Constitution to criminalize drug use.

    Today, a majority of states have legalized medical marijuana, and a growing number are legalizing recreational marijuana use. Enforcement of federal laws outlawing marijuana in those states is the type of federal interference with state laws that conservatives usually oppose. Hopefully, in this area the Trump administration will exercise restraint and respect state marijuana laws.

    Sessions’ announcement was not the only pro-drug war announcement made by the administration this week. President Trump himself, in a meeting with the president of Columbia, promised to continue US intervention in South and Central America to eliminate drug cartels. President Trump, like his attorney general, seems to not understand that the rise of foreign drug cartels, like the rise of domestic drug gangs, is a consequence of US drug policy.

    The use of government force to stop adults from putting certain substances into their bodies – whether marijuana, saturated fats, or raw milk – violates the nonaggression principle that is the bedrock of a free society. Therefore, all those who care about protecting individual liberty and limiting government power should support ending the drug war. Those with moral objections to drug use should realize that education and persuasion, carried out through voluntary institutions like churches and schools, is a more moral and effective way to discourage drug use than relying on government force.

  • Why China's Strategic Petroleum Reserve Is All That Matters For OPEC

    When OPEC sits down on Thursday, keeping the price of Brent above $50 (to avoid a budget catastrophe and social upheaval in Saudi Arabia) and below $60 (to prevent US production from going exponential), will be just one problem the cartel nations and various hangers-on will be desperate to solve. A much bigger one, literally, is the problem that led to this week’s OPEC meeting in the first place, and years of headache for OPEC and non-OPEC nations: a record global oil inventory glut.

    The supply glut that began in mid-2014 has dumped almost one billion barrels of petroleum into global inventories. However, of this only 35–45% has ended up in transparent OECD tanks. For OPEC, that is all the matters – in the past, OPEC oil ministers have repeatedly referenced the level of OECD petroleum inventories relative to their five-year average as a gauge of the rebalancing. And, as ScotiaBank notes, those inventories were more than 280 Mbbl above their five-year average as of January and, while European stocks have been falling into a healthier range, the same cannot be said of industry stocks in the US, which despite declining for several weeks, are just below all time highs.

    But forget OECD: an increasingly greater concern for OPEC is not the less than a third of above ground oil held in developed nations; it is the rest that is the big challenge. As ScotiaBank’s Rory Johnston points out in the following chart, the majority of the remainder was absorbed by China’s vast and growing strategic petroleum reserve (SPR), which means that “the lion’s share of functional—and thus needing to draw from an OPEC perspective—industry inventories remain in the OECD, and specifically in the US (chart 3).”

    As we have explained on several occasions over the past year, China’s SPR is far more important to the global oil (im)balance and inventory glut than the less than a third of total oil produced since the summer of 2014 and stored. This is due to one main reason: while ScotiaBank is correct that any draws will likely come from OECD storage, it forgets the demand side of the equation.

     


    Storage tanks in China’s strategic oil reserve complex in Zhoushan

    One year ago, JPMorgan estimated that the daily build of China’s SPR, had grown at a breakneck pace, from 491Kbpd average in 2015 to a record 1.191MMbpd in 2016 through May, equivalent to roughly 15% of the country’s total crude oil imports.

    More importantly, it was roughly a year ago when JPM calculated that China’s SPR was getting dangerously close to its estimated capacity, just over 500 million barrels.

    JPM also made a forecast that based on its assumptions, Chinese oil imports would slide by roughly the amount that would have been going into the SPR starting in late 2016 as the reserve hit capacity. When that did not happen, there was much confusion among the commodity space, until in late September 2011, satellite imagery from Orbital Insight revealed that the total size of China’s SPR was vastly greater than previously estimated.

    According to satellite images by  geospatial analytics startup Orbital Insight, China, has not only misrepresented how much oil it has stored, it has done so at a massive scale, with the real number dwarfing even JPM own estimate: the real amount of Chinese oil in storage, according to Orbital, was a whopping 600 million barrels as of May. Assuming JPM’s estimated rate of SPR accumulation of about 1mmbpd, the 600 million number as of May would have grown to well over 700 million barrels as of September. 

     

    Orbital’s figure as first reported by Bloomberg, is well over two times larger than China’s official estimates for strategic petroleum reserves and for commercial stocks, said Orbital Chief Executive Officer James Crawford.

    To be sure, in late 2016 other skeptics started warning that even with the revised size estimates, China’s SPR was likely approaching capacity. Last September, the IEA warned that “recent pillars of demand growth China and India are wobbling.” S&P Global Platts’ Ernsberger, cited by CNBC, said that the slowdown in Chinese demand was worrying for major oil producers.

    “The demand picture is very unsettling for OPEC and for all producers of crude and refined products (and this is seen most significantly in) the slowdown in growth in the Chinese market. China has returned more incremental demand for the oil market in the last five years than any other country in the world and more than almost any of the counties combine. But this year demand growth in China has stalled and that represents a significant change in the environment for producers both in OPEC and outside it.”

    Then 2016 came and went, and we find ourselves almost mid-way into 2017 and ask: has anything finally changed, and will all those predictions of an imminent Chinese SPR overflow finally prove accurate?

    We don’t know just yet, but according to data released by the General Administration of Customs data on Tuesday, China’s oil stockpiling pace finally tumbled to 1.36mbpd in April, from 1.6mbpd in March, the sharpest decline in reserve accumulation in years, and in line with the recent slowdown from record oil imports. If indeed China is finally at capacity for the SPR, the SPR stocpiling is about to fall off as cliff this month.

    In other words, all those forecasts that China’s SPR is almost full appear to be finally coming true, and at the worst possible time for OPEC, because if suddenly over 1 million in daily “demand” is pulled from the market, OPEC will suddenly find themselves with another huge glut now that Beijing is no longer waving it in. In fact, we contend that while OPEC’s decision on Thursday is fully priced in by the market, the only thing that matters for the future price of oil is how long until China halts SPR imports. Here, those who have faster access to commercial satellite imagery will be a distinct advantage over everybody else, even the momentum-chasing, headline scanning algos…

  • US Journalism's New "Golden Age"?

    The Washington Post and other big media are hailing a new journalistic “golden age” as they punish President Trump for disparaging them, but is this media bias a sign of good journalism or itself a scandal, asks Robert Parry, via ConsotriumNews.com…

    The mainstream U.S. media is congratulating itself on its courageous defiance of President Trump and its hard-hitting condemnations of Russia, but the press seems to have forgotten that its proper role within the U.S. democratic structure is not to slant stories one way or another but to provide objective information for the American people.

    The Washington Post building in downtown Washington, D.C. (Photo credit: Washington Post)

    By that standard – of respecting that the people are the nation’s true sovereigns – the mainstream media is failing again. Indeed, the chasm between what America’s elites are thinking these days and what many working-class Americans are feeling is underscored by the high-fiving that’s going on inside the elite mainstream news media, which is celebrating its Trump- and Russia-bashing as the “new golden age of American journalism.”

    The New York Times and The Washington Post, in particular, view themselves as embattled victims of a tyrannical abuser. The Times presents itself as the brave guardian of “truth” and the Post added a new slogan: “Democracy dies in darkness.” In doing so, they have moved beyond the normal constraints of professional, objective journalism into political advocacy – and they are deeply proud of themselves.

    In a Sunday column entitled “How Trump inspired a golden age,” Washington Post columnist Dana Milbank wrote that Trump “took on the institution of a free press – and it fought back. Trump came to office after intimidating publishers, barring journalists from covering him and threatening to rewrite press laws, and he has sought to discredit the ‘fake news’ media at every chance. Instead, he wound up inspiring a new golden age in American journalism.

    “Trump provoked the extraordinary work of reporters on the intelligence, justice and national security beats, who blew wide open the Russia election scandal, the contacts between Russia and top Trump officials, and interference by Trump in the FBI investigation. Last week’s appointment of a special prosecutor – a crucial check on a president who lacks self-restraint – is a direct result of their work.”

    Journalism or Hatchet Job?

    But has this journalism been professional or has it been a hatchet job? Are we seeing a new “golden age” of journalism or a McCarthyistic lynch mob operating on behalf of elites who disdain the U.S. constitutional process for electing American presidents?

    Director of National Intelligence James Clapper (right) talks with President Barack Obama in the Oval Office, with John Brennan and other national security aides present. (Photo credit: Office of Director of National Intelligence)

    For one thing, you might have thought that professional journalists would have demanded proof about the predicate for this burgeoning “scandal” – whether the Russians really did “hack” into emails of the Democratic National Committee and Hillary Clinton campaign chairman John Podesta and then slip the information to WikiLeaks to influence the outcome of the 2016 election.

    You have surely heard and read endlessly that this conclusion about Russia’s skulduggery was the “consensus view of the 17 U.S. intelligence agencies” and thus only some crazy conspiracy theorist would doubt its accuracy even if no specific evidence was evinced to support the accusation.

    But that repeated assertion is not true. There was no National Intelligence Estimate (or NIE) that would compile the views of the 17 intelligence agencies. Instead, as President Obama’s Director of National Intelligence James Clapper testified before a Senate Judiciary subcommittee on May 8, the Russia-hacking claim came from a “special intelligence community assessment” (or ICA) produced by selected analysts from the Central Intelligence Agency, National Security Agency and Federal Bureau of Investigation, or as Clapper put it, “a coordinated product from three agencies – CIA, NSA, and the FBI – not all 17 components of the intelligence community.”

    Further, as Clapper explained, the “ICA” was something of a rush job beginning on President Obama’s instructions “in early December” and completed by Jan. 6, in other words, a month or less.

    Clapper continued: “The two dozen or so analysts for this task were hand-picked, seasoned experts from each of the contributing agencies.” However, as any intelligence expert will tell you, if you “hand-pick” the analysts, you are really hand-picking the conclusion.

    You can say the analysts worked independently but their selection, as advocates for one position or another, could itself dictate the outcome. If the analysts were hardliners on Russia or hated Trump, they could be expected to deliver the conclusion that Obama and Clapper wanted, i.e., challenging the legitimacy of Trump’s election and blaming Russia.

    The point of having a more substantive NIE is that it taps into a much broader network of U.S. intelligence analysts who have the right to insert dissents to the dominant opinions. So, for instance, when President George W. Bush belatedly ordered an NIE regarding Iraq’s WMD in 2002, some analysts – especially at the State Department – inserted dissents (although they were expunged from the declassified version given to the American people to justify the 2003 invasion of Iraq).

    An Embarrassing Product

    Obama’s “ICA,” which was released on Jan. 6, was a piece of work that embarrassed many former U.S. intelligence analysts. It was a one-sided argument that lacked any specific evidence to support its findings. Its key point was that Russian President Vladimir Putin had a motive to authorize an information operation to help Hillary Clinton’s rival, Donald Trump, because Putin disdained her work as Secretary of State.

    Russian President Vladimir Putin addresses UN General Assembly on Sept. 28, 2015. (UN Photo)

    But the Jan. 6 report failed to include the counter-argument to that cui bono assertion, that it would be an extraordinary risk for Putin to release information to hurt Clinton when she was the overwhelming favorite to win the presidency. Given the NSA’s electronic-interception capabilities, Putin would have to assume that any such undertaking would be picked up by U.S. intelligence and that he would likely be facing a vengeful new U.S. president on Jan. 20.

    While it’s possible that Putin still took the risk – despite the daunting odds against a Trump victory – a balanced intelligence assessment would have included such contrary arguments. Instead, the report had the look of a prosecutor’s brief albeit without actual evidence pointing to the guilt of the accused.

    Further, the report repeatedly used the word “assesses” – rather than “proves” or “establishes” – and the terminology is important because, in intelligence-world-speak, “assesses” often means “guesses.” The report admits as much, saying, “Judgments are not intended to imply that we have proof that shows something to be a fact. Assessments are based on collected information, which is often incomplete or fragmentary, as well as logic, argumentation, and precedents.”

    In other words, the predicate for the entire Russia-gate scandal, which may now lead to the impeachment of a U.S. president and thus the negation of the Constitution’s electoral process, is based partly on a lie – i.e., the claim that the assessment comes from all 17 U.S. intelligence agencies – and partly on evidence-free speculation by a group of “hand-picked” analysts, chosen by Obama’s intelligence chiefs.

    Yet, the mainstream U.S. news media has neither corrected the false assertion about the 17 intelligence agencies nor demanded that actual evidence be made public to support the key allegation that Russia was the source of WikiLeaks’ email dumps.

    By the way, both Russia and WikiLeaks deny that Russia was the source, although it is certainly possible that the Russian government would lie and that WikiLeaks might not know where the two batches of Democratic emails originated.

    A True ‘Golden Age’?

    Yet, one might think that the new “golden age of American journalism” would want to establish a firm foundation for its self-admiring reporting on Russia-gate. You might think, too, that these esteemed MSM reporters would show some professional skepticism toward dubious claims being fed to them by the Obama administration’s intelligence appointees.

    President Donald Trump being sworn in on Jan. 20, 2017. (Screen shot from Whitehouse.gov)

    That is unless, of course, the major U.S. news organizations are not abiding by journalistic principles, but rather see themselves as combatants in the anti-Trump “resistance.” In other words, if they are behaving less as a Fourth Estate and more as a well-dressed mob determined to drag the interloper, Trump, from the White House.

    The mainstream U.S. media’s bias against Putin and Russia also oozes from every pore of the Times’ and Post’s reporting from Moscow. For instance, the Times’ article on Putin’s comments about supposed secrets that Trump shared with Russian Foreign Minister Sergey Lavrov at the White House had the headline in the print editions: “Putin Butts In to Claim There Were No Secrets…” The article by Andrew Higgins then describes Putin “asserting himself with his customary disruptive panache” and “seizing on foreign crises to make Russia’s voice heard.”

    Clearly, we are all supposed to hate and ridicule Vladimir Putin. He is being demonized as the new “enemy” in much the way that George Orwell foresaw in his dystopian novel, 1984. Yet, what is perhaps most troubling is that the major U.S. news outlets, which played instrumental roles in demonizing leaders of Iraq, Syria and Libya, believe they are engaged in some “golden age” journalism, rather than writing propaganda.

    Contempt for Trump

    Yes, I realize that many good people want to see Trump removed from office because of his destructive policies and his buffoonish behavior – and many are eager to use the new bête noire, Russia, as the excuse to do it. But that still does not make it right for the U.S. news media to abandon its professional responsibilities in favor of a political agenda.

    The run-down PIX Theatre sign reads “Vote Trump” on Main Street in Sleepy Eye, Minnesota. July 15, 2016. (Photo by Tony Webster Flickr)

    On a political level, it may not even be a good idea for Democrats and progressives who seem to be following the failed strategy of Hillary Clinton’s campaign in seeking to demonize Trump rather than figuring out how to speak to the white working-class people who voted for him, many out of fear over their economic vulnerability and others out of anger over how Clinton dismissed many of them as “deplorables.”

    And, by the way, if anyone thinks that whatever the Russians may have done damaged Clinton’s chances more than her colorful phrase disdaining millions of working-class people who understandably feel left behind by neo-liberal economics, you may want to enroll in a Politics 101 course. The last thing a competent politician does is utter a memorable insult that will rally the opposition.

    In conversations that I’ve had recently with Trump voters, they complain that Clinton and the Democrats weren’t even bothering to listen to them or to talk to them. These voters were less enamored of Trump than they were conceded to Trump by the Clinton campaign. These voters also are not impressed by the endless Trump- and Russia-bashing from The New York Times, The Washington Post, CNN and MSNBC, which they see as instruments of the elites.

    The political danger for national Democrats and many progressives is that mocking Trump and thus further insulting his supporters only extends the losing Clinton strategy and cements the image of Democrats as know-it-all elitists. Thus, the Democrats risk losing a key segment of the U.S. electorate for a generation.

    Not only could that deny the Democrats a congressional majority for the foreseeable future, but it might even get Trump a second term.

  • Legendary Investor Asher Edelman Says "I Have No Doubt" PPT Behind Market Rally

    Legendary vulture investor Asher Edelman, the 1980s model for Gordon Gekko, strayed into what must’ve been uncomfortable territory for CNBC during an appearance on “Smart Money” when he discussed his view that the government’s “plunge protection team” is the only thing propping up the current market rally, and said he suspects that it has again been recently een intervening in the market to keep stocks at record highs.

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    Edelman simply notes that he doesn’t want to be in the markets right now because “I don’t know when the plug is going to be pulled.”

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    Few can explain the market’s recent resilience, holding near record highs despite weak economic data and intensifying geopolitical tensions. The main benchmarks have risen for the fourth straight day following last week’s “Trump Dump” despite a terror attack in the U.K., the worst soft economic data since February 2016, and surprisingly low trading volume.

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    The “plunge protection team” was created by President Ronald Reagan one year after the stock market crash in 1987, when the president called for the creation of the “Working Group on Financial Markets.”

    It’s believed – as the name would suggest and as has been profiled on countless occasions on this website previously – that the group’s mandate is to maintain stability in the market and head off any severe crashes like what was seen in 1987. It’s believed the group reports only to the president, though the head of the Treasury, head of the Securities and Exchange Commission and Federal Reserve Chairman are also involved. The team, according to Asher, steps in to execute trades on all exchanges when the market isn’t behaving as it would like, working only with big banks like Goldman Sachs Group and Morgan Stanley. 

    “We have seen the most extraordinary lack of volatility in the VIX since Trump has been in office and it’s interesting the night he was elected you may recall the futures came down about 400 or 600 points.

     

    You may also recall that the next morning they were even again. Watching plunge protection for years, I had no doubt that’s what happened.

    That may have been the case in the 1980s, however in recent years the PPT is the collaboration of the NY Fed and Citadel, which are most aggressive during times of substantial market stress and selling, when intervention is needed to stop the downward momentum in prices.

    Edelman says he believes one sign of TPP intervention is when a smaller, less-liquid stock suddenly rises late in the trading day.

    We’ve noted in the past that there appears to be a rule against mentioning the team on CNBC – with guests routinely getting “Schiff’d” for doing so.

    And once again, this time, the “theory” was treated with derision by his fellow hosts.

    “I think we all have so many questions here I don’t think I know where to begin,” Fast Money host Melissa Lee said.

    Some audience members were more enthusiastic.

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  • Visualizing The Rise Of Young Asylum Seekers In Europe

    As highlighted in today's UNICEF report 'A Child is a Child', the number of young children applying for asylum in Europe has continued to rise, reaching a new peak last year.

    Infographic: The Rise of Young Asylum Seekers in Europe | Statista

    You will find more statistics at Statista

    As Statista's Martin Armstrong notes, according to figures from Eurostat, there were almost 290,000 first time applicants in 2016 that were under the age of 14.  Of all child asylum seekers in Europe, 170,000 were not accompanied by an adult in 2015-2016. In fact, 92 percent of all minors arriving in Italy by sea in 2016 and the first months of 2017 were unaccompanied. Globally, children account for around 28 percent of all trafficking victims.

    We are unsure how many of these children were in attendance at last night's Ariana Grande concert suicide bombing…

  • Shaping The Future: Moscow And Beijing's Multipolar World Order

    Authored by Federico Pieraccini via The Stratgic Culture Foundation,

    Once in a while, think tanks such as the Brookings Institute are able to deal with highly strategic and current issues. Often, the conferences held by such organizations are based on false pretences and copious banality, the sole intention being to undermine and downplay the efforts of strategic opponents of the US. Recently, the Brookings Institute's International Strategy and Strategy Project held a lecture on May 9, 2017 where it invited Bobo Lo, an analyst at Lowy Institute for International Policy, to speak. The topic of the subject, extremely interesting to the author and mentioned in the past, is the strategic partnership between China and Russia.

    The main assumption Bobo Lo starts with to define relations between Moscow and Beijing is that the two countries base their collaboration on convenience and a convergence of interests rather than on an alliance. He goes on to say that the major frictions in the relationship concern the fate that Putin and Xi hold for Europe, in particular for the European Union, in addition to differences of opinions surrounding the Chinese role in the Pacific. In the first case, Lo states that Russia wants to end the European project while China hopes for a strong and prosperous Europe. With regard to the situation in the Pacific, according to this report, Moscow wants a balance of power between powers without hegemonic domination being transferred from Washington to Beijing.

    The only merit in Lo’s analysis is his identification of the United States as the major cause of the strategic proximity between Moscow and Beijing, certainly a hypothesis that is little questioned by US policy makers. Lo believes Washington's obsession with China-Russia cooperation is counterproductive, though he also believes that the United States doesn’t actually possess capabilities to sabotage or delimit the many areas of cooperation between Beijing and Moscow.

    What is missing in Lo’s analysis are two essential factors governing how Moscow and Beijing have structured their relationship. China and Russia have different tasks in ushering in their world order, namely, by preserving global stability through military and economic means. Their overall relationship of mutual cooperation goes beyond the region of Eurasia and focuses on the whole process of a sustainable globalization as well as on how to create an environment where everyone can prosper in a viable and sustainable way. Doing this entails a departure from the current belligerent and chaotic unipolar world order.

    Moscow and Beijing: Security and Economy

    Beijing has been the world's economic engine for over two decades and shows no signs of slowing down, at least not too much. Moscow, contrary to western media propaganda, has returned to play a role not only on a regional scale but as a global power. Both of these paths of military and economic growth for China and Russia have set things on a collision course with the United States, the current global superpower that tends to dominate international relations with economic, political and military bullying thanks to a complicit media and corrupt politicians.

    In the case of Beijing, the process of globalization has immensely enhanced the country, allowing the Asian giant to become the world's factory, enabling Western countries to outsource to low-cost labor. In this process of economic growth, Beijing has over the years gone from being a simple paradise for low-cost outsourcing for private companies to being a global leader in investment and long-term projects. The dividends of years of wealth accumulation at the expense of Western nations has allowed Beijing to be more than just a strategic partner for other nations. China drives the process of globalization, as recently pointed out by Xi Jinping in Davos in a historic speech. China's transition from a harmless partner of the West to regional power with enormous foreign economic investments place the country on a collision course with Washington. Inevitably, Beijing will become the Asian hegemon, something US policymakers have always guaranteed will not be tolerated.

    The danger Washington sees is that of China emerging as a regional superpower that will call the shots in the Pacific, the most important region of the planet. The United States has many vested interests in the region and undeniably sees its future as the leader of the world order in jeopardy. Obama's pivot to Asia was precisely for the purposes of containing China and limiting its economic power so as to attenuate Beijing’s ambitions.

    Unsurprisingly, Washington's concerns with Moscow relate to its resurgence in military capabilities. Russia is able to oppose certain objectives of the United States (see Ukraine or Syria) by military means. The possibility of the Kremlin limiting American influence in Eastern Europe, the Middle East and Eurasia in general is cause for concern for American policy makers, who continue to fail to contain Russia and limit Moscow’s spheres of influence.

    In this context, the strategic division of labor between Russia and China comes into play to ensure the stability of the Eurasian region as a whole; in Asia, in the Middle East and in Europe. To succeed in this task, Moscow has mainly assumed the military burden, shared with other friendly nations belonging to the affected areas. In the Middle East, for example, Tehran's partnership with Moscow is viewed positively by Beijing, given its intention to stabilize the region and to eradicate the problem of terrorism, something about which nations like China and Russia are particularly concerned.

    The influence of Islamist extremists in the Caucasian regions in Russia or in the autonomous region of Xinjiang in China are something that both Putin and Xi are aware can be exploited by opposing Western countries. In North Africa, Egypt has signed several contracts for the purchase of military vehicles from Moscow, as well as having bought the two Mistral ships from France, thereby relying on military supplies from Moscow. It is therefore not surprising that Moscow and Egypt cooperated with the situation in Libya and in North Africa in general.

    In Southeast Asia, Moscow seeks to coordinate efforts to reach an agreement between Afghanistan, Pakistan and India. The entry into the Shanghai Cooperation Organization (SCO) of New Delhi and Islamabad (Tehran will be next), with the blessing of Beijing as the protagonist of the 2017 SCO meeting, is a keystone achievement and the right prism through which to observe the evolution of the region. Moscow is essentially acting as a mediator between the parties and is also able to engage with India in spite of the dominating presence of China. The ultimate goal of Moscow and Beijing is to eradicate the terrorist phenomenon in the Asian region with a view to what is happening in North Africa and the Middle East with Iran and Egypt.

    Heading to a Multipolar World Order

    The turning point in relations between Moscow and Beijing concerns the ability to engage third countries in military or economic ways, depending on these countries’ needs and objectives. Clearly in the military field it is Moscow that is leading, with arms sold to current and future partners and security cooperation (such as with ex-Soviet Central-Asian republics or in the Donbass) and targeted interventions if needed, as in Syria. Beijing, on the other hand, acts in a different way, focusing on the economic arena, in particular with the Asian Infrastructure Investment Bank (AIIB) at its center.

    Initiatives such as the One Belt One Road (OBOR) and the Maritime Silk Road have the same strategic aim of the Russian military initiative, namely, ensuring the independence of the region from a geo-economic perspective, reaching win-win arrangements for all partners involved. Naturally, the win-win agreement does not mean that China wins and then wins again; rather, a series of bilateral concessions can come to satisfy all actors involved. An important example in this regard that explains the Sino-Russian partnership concerns the integration of the Eurasian Union with the Chinese Silk Road. The Russian concerns over the predominant status of the Chinese colossus in Central Asia have been assuaged by a number of solutions, such as the support of the OBOR infrastructure program to that of the Eurasian Union. Beijing is not interested in replacing Moscow's leading role the post-Soviet nations in Central Asia but rather with providing significant energy and economic development to particularly underdeveloped nations that are in need of important economic investment, something only Beijing is able to guarantee.

    The linking of the Eurasian Economic Union (EEU) with the One Belt One Road initiative guarantees Moscow a primary role in the transit of goods from east to west, thereby becoming the connecting point between China and Europe while expanding the role and function of the EEU. All participants in these initiatives have a unique opportunity to expand their economic condition through this whole range of connections. Beijing guarantees the money for troubled countries, and Moscow the security. The SCO will play a major role in reducing and preventing terrorist influence in the region, a prerequisite for the success of any projects. Also, the AIIB, and to some extent the BRICS Development Bank, will also have to step in and offer alternative economic guarantees to countries potentially involved in these projects, in order to free them from the existing international financial institutions.

    One Belt One Road, and all the related projects, represent a unique occasion whereby all relevant players share common goals and benefits from such transformative geo-economic relationships. This security-economy relationship between Moscow and Beijing is  the heart of the evolution of the current world order, from the unipolar to the multipolar world. The US cannot oppose China on the economic front and Russia on the military front. It all comes down to how much China and Russia can continue to provide and guarantee economic and security umbrellas for the rest of the world.

  • "Let's Burn Down The Universities"

    Authored by JC Collins via Philosophy of Metrics blog,

    An Offensive Act of Self Defence to Save the Great School of Western Thought

    It should be clear to all reasoning people with the ability for critical thinking that a pattern of cultural warfare has been unfolding against the Western world since at least the end of World War Two. The contrast between what was then and what is now is stark and frightening. It should serve as all the evidence we require to make the final determination about what has been happening.

    The complete destruction of the traditional family unit has taken place through a process of indirect and direct attacks against the proven characteristics of Western civilization. It should be obvious that media and art have orchestrated a well-thought out strategy of cultural warfare against the masculine and feminine ideals and support columns of culture.

    This strategy has attacked the natural and instinctual strengths of both men and women while promoting the weakness from within each of us as individuals. The battles of this cultural attack have been orchestrated and waged from inside the once great structures of Western thought.

    Our educational buildings and curriculums have been used to erode and shatter all the ideals of natural and instinctual existence which have developed within the Western mind. The more we remember and rediscover, the more we realize that almost everything which is taught in our schools is either a corrupt twisted version of truth, or is an outright lie and fabrication.

    If our curriculums were based on truth they would not need the constant changing and tweaking which takes takes place. Nor would it require involvement of government controls. All are tell-tale signs that something smells rotten in Denmark.

    Over the years there have been various exposé and theories surrounding everything from the Frankfurt School, the Tavistock Institute, Lucis Trust, Freemasonic control of all things, Satanism, Bilderberg, Trilateral, Rhodes, and so on and so on. The plethora of culprits and evil organizations run the gambit of all human elitism and consolidation of wealth and power.

    Not withstanding some truth to this large list of nefarious actors, and not to mention that the stated longterm goals of these groups and organizations match with the results which have been achieved since the end of the war, there is much more to the expanding collapse of Western civilization which needs to be considered.

    In the posts The Wisdom of the Ancients – Part One and How Your Brain is Turned Against You, we reviewed our own accountabilities and responsibilities alongside some of the techniques which are used against us. It should be clear that we may have to listen to the sales pitch of a huckster but it doesn’t mean we have to believe that huckster. The theme from those posts is that if we don’t plan our own lives someone else will plan it for us. This is in essence what is happening.

    We have been conditioned to follow and plan our lives along a very specific path which forces us further down into the systemic control mechanisms which have taken hold of our culture. You are left to plan your life within this strategic grid. This grid contains multiple pathways which all lead through the false teachings and methodologies which have been manufactured by those who wish to devolve and re-engineer Western civilization. The trap ensures you continue bouncing around inside the construct with an ever growing sense of confusion and hopelessness.

    Those who do not agree with the teachings of the construct are made to feel regressive and are told they are the problem in society for which the construct exists in the first place. This script is supported by all forms of media, including movies, music, social media, both mainstream and alternative media, as well as school curriculums, from the early pre-school sessions to the “advanced” learnings which are communicated and rehearsed in colleges and universities.

    Please ask yourself a question. Does it feel like our culture has been progressive? Everything that has a seed in human weakness and depravity has been promoted and expanded across the decades. Our culture is over-sexualized. We thieve and betray one another over the smallest rewards. The murder of unborn children is accepted as righteous even though it ruins the emotional spirit of the mother. Racism against anything rooted in traditional Western culture is out of control. Our children are taught at an early age about the degenerate sex world. Massive migration has undermined the Western ideals and systems of belief which have been a part of its growth and greatness for thousands of years. Alcoholism is both openly promoted and applauded through the subtle insinuations in the media. The rampant fragmentation of the family unit and a corrupt and unreliable system of law which supports that fragmentation are the greatest loss we have experienced. This is all supported by an educational system which is reducing critical thinking and dumbing down generations.

    This does not feel progressive. When we consider the stark changes which have taken place over the last eight decades we should come to the conclusion that it is in fact regressive. All of the technological advancements would still have taken place without the corruption of Western civilization, so any form of counter-argument about science and the advancement of medicine and technology being possible because of this “progressive” culture stands in opposition and denial of the leaps made during the agricultural and industrial revolutions.

    Similar lines of thought regarding colonialism and the slave trade are often made by the regressive left educational institutions and supporting media. But these arguments also stand in opposition to the truthful history of the world where we find that all cultures had forms of colonialism and slave trades are wide and diverse, with there being more slavery in the world today than at any other time in world history.

    The disease has burrowed itself so deep into our institutions that it is hard to imagine how we would remove it without completely destroying the host. But what choice to we have at this late hour? Continuing as we have been is tantamount to surrender and shackling our descendants with an unthinkable ideology of absolute sameness and collectivism.

    It’s interesting that more and more students are coming out of the university system and understanding that they in fact understand nothing. The loss of critical thinking and a cultural anchor point, both of which have been a part of the collective-socialist strategy, are now beginning to awaken more of those who have been traversing through the system. It’s almost as if nature and instinct are re-emerging from within the individual minds of the construct and attempting to establish new anchor points.

    Now is the time to act and reverse the momentum which has thus far worked against us. We need to tear down the institutions and framework of the simulated world which has built up around us. The great school of the Western mind cannot be destroyed and it will never stop learning. In fact, this challenge, the one we have been faced with now for generations, could very well end up being one of our greatest lessons and opportunities for advancement.

  • "Arbitrage Is Dead" – Commodity Traders Lament A World "Where Everyone Knows Everything"

    For commodity traders operating in the Information Age, Bloomberg reports that just good old trading doesn’t cut it anymore… "Everything is transparent, everybody knows everything and has access to information."

    Unlike the stock market in which transactions are typically based on information that’s public, firms that buy and sell raw materials thrived for decades in an opaque world where their metier relied on knowledge privy only to a few. Now, technological development, expanding sources of data, more sophisticated producers and consumers as well as transparency surrounding deals are eroding their advantage.

    Just ask Noble Group…

    At a panel discussing ‘What’s Next for Commodity Trading: Drivers, Disruptors and Opportunities’, Bloomberg reports that Sunny Verghese, the chief executive officer of food trader Olam International Ltd., lamented declining margins.

    “The consumers and producers are trying to eat our lunch. So we got to be smart about differentiating ourselves,” he said.

    As market participants’ access to information increases, the traders highlighted the need to more than simply buy and sell commodities as profits from arbitrage — or gains made from a differential in prices — shrinks. That means getting involved in the supply chain by potentially buying into infrastructure that’s key to the production and distribution of raw materials, and also providing financing for the development of such assets.

    “The most valuable commodity out there is information, and the most useful information is the proprietary, critical information that you obtain from your own supply chain,” said John Driscoll, the chief strategist at JTD Energy Services Pte, who has spent more than 30 years in the petroleum trading industry in Singapore.

     

    “You have to have skin in the game. You have to have access to assets, whether it’s infrastructure, terminals, vessels or refineries.”

    It’s critical for commodity traders to evolve as margins have declined because of more transparency and “price arbitrage has disappeared,” said Olam’s Verghese. For example, the number of price quotes published by agencies such as S&P Global Platts and Argus, which assess the value of commodities globally, have increased about 15 times since 1990, according to Verghese.

    While “arbitrage is dead,” traders will “continue to have substantial opportunity and disruption but the way of capturing that opportunity becomes more sophisticated,” Mercuria’s Jaeggi said.

  • Nigel Farage Responds to Manchester Suicide Attack: 'This is a Direct Attack on Children'

    Nigel Farage was interviewed by Tucker Carlson this evening to discuss the suicide attack in Manchester that killed at least 19 and wounded dozens.

    Farage told Carlson, “we have been lulled into a slight sense of complacency,” refraining, however, from jumping to conclusions as to who was responsible for the attack.

    He noted that Britains shouldn’t put their guard down, post BREXIT, saying “we’ve convinced ourselves that we’re in a better place than the rest of Europe on this.”

    Farage pointed out that the bombing was a ‘direct attack on children… marks a new low in all forms of terrorism.”

    Watch.

    Content originally published at iBankCoin.com

     

  • How Russia Became "Our Adversary" Again

    Authored by Paul Street via The Strategic Culture Foundation,

    Americans are routinely told by politicians and corporate media pundits and talking heads that Russia is their enemy – an “adversary state.”  The assertion has been normalized.  It passes without challenge or justification.

    Forget for now the question of whether and how “our adversary Russia” intervened significantly on Donald Trump’s behalf in the 2016 U.S. presidential election.  Put aside the glaring absence of any smoking gun evidence to back that charge up and contemplate the fundamental matter of how and why Vladimir Putin’s Russia became “our enemy” in the first place.

    For those of us old enough to remember the long Cold War era, the designation of Russia as a leading global U.S. foe carries no small irony. From the Bolshevik Revolution of 1917 until the collapse of the officially Marxist-Leninist Soviet Union and its Eastern European satellites in the early 1990s, Russia was an ideological and political enemy of the Western capitalist “elite.”

    The USSR was no workers’ paradise.  For all its formal allegiance to Marx and Engels, it was a militantly hierarchical class society ruled by a tyrannical state. After World War Two, it held brutal military power over Eastern Europe and East Germany. Still, Soviet-era Russia created an urban and industrialized society with real civilizational accomplishments (including cradle-to-grave health-care, housing, and food security and an impressive educational system and cultural apparatus) outside capitalism.  It pursued an independent path to modernity without a capitalist class, devoid of a bourgeoisie, in the name of socialism. It therefore posed a political and ideological challenge to U.S-led Western capitalism – and to Washington’s related plans for the Third World periphery, which was supposed to subordinate its developmental path to the needs of the rich nations (the U.S., Western Europe, and honorarily white Japan) of the world-capitalist core.

    Honest U.S. Cold Warriors knew that it was the political threat of “communism” – its appeal to poor nations and people (including the lower and working classes within rich/core states) – and not any serious military danger that constituted the true “Soviet menace.”  Contrary to U.S. “containment” doctrine after World War II, the ruling Soviet bureaucracy was concerned above all with keeping an iron grip on its internal and regional empire, not global expansion and “world revolution.” It did, however “deter…the worst of Western violence” (Noam Chomsky) by providing military and other assistance to Third World targets of U.S. and Western attack (including China, Korea, Indonesia, Egypt, Syria, Cuba, Vietnam, and Laos).  Along the way, it provided an example of independent development outside and against the capitalist world system advanced by the superpower headquartered in Washington.

    To make matters worse from Washington’s “Open Door” perspective, the Soviet Empire kept a vast swath of the world’s natural and human resources walled off from profitable exploitation by global capital.

    All of this was more than enough to mark the Soviet Union as global public enemy number one for the post-WWII U.S. power elite, which had truly planet-wide imperial ambitions, unlike Moscow.

    The Soviet deterrent and alternative to U.S.-led capitalism-imperialism collapsed once and for all in the early 1990s.  Washington celebrated with unchallenged invasions of Panama and Iraq. The blood-drenched U.S. President George H.W. Bush exulted that “what we say goes” in a newly unipolar, post-Soviet world. Russia reverted to not-so “free market” capitalism under U.S.-led Western financial supervision and in accord with the savage austerity and inequality imposed by the neoliberal “Washington consensus.” Chomsky got it right in 1991.  “With the collapse of Soviet tyranny,” he wrote, “much of the region can be expected to return to its traditional [subordinate] status, with the former high echelons of the bureaucracy playing the role of the Third World elites that enrich themselves while serving the interests of foreign investors.” The consequences were disastrous for many millions of ordinary Russians.

    The West said, “welcome to the machine” and “enjoy your new freedom to starve and die young.” The Soviet tyranny was turned into an oligarchs’ wonderland, a neoliberal wasteland combining untold new opulence for the fortunate Few with a stark decline in social and living standards for the Many.  Russia remains a capitalist nightmare and plutocrats’ playground.

    So, what happened?  How did “our” Cold War super-enemy become “our” brand new top “adversary” all over again, more than a quarter century after the tearing down of the Berlin Wall? The bottom line is that proud, post-Cold War Russia finally experienced too much brazen humiliation and betrayal at the hands of the U.S.-led West. It got up off the canvas under national/nationalist strongman Putin (a former KGB Lieutenant-Colonel wise in the ways of the West) and marshalled enough of still-intact natural and military resources and patriotic to challenge the American Empire’s hubristic claim to the right to rule Eurasia with impunity. “What we say goes” hit a new wall of Russian dignity and power.

    One of the many dirty little secrets of the U.S. Cold War was that anti-communism functioned as a pretext and cover for Washington’s Wall Street-fueled ambition to force open and run the entire world system in accord with its multinational corporate elite’s globalist- “Open Door” political-economic needs.  From this imperial perspective, the real Cold War enemy was not so much “communism” as other peoples’ struggles for national, local, and regional autonomy and independence. The enemy remains long after the statues of Marx, Engels, Lenin, and Stalin have come down.

    It doesn’t matter than Russia is no longer “socialist.” Nationalist and regional push-back against Uncle “We Own the World” Sam has been more than sufficient to get Putin designated as the next official Hitler and Russia targeted as a malevolent opponent by the U.S. elite political class and media. Mike Whitney puts it very well in a recent CounterPunch essay:

    “What has Russia done to deserve all the negative press and unsupported claims of criminal meddling?…Just look at a map. For the last 16 years, the US has been rampaging across North Africa, the Middle East and Central Asia. Washington intends to control critical oil and natural gas reserves in the ME, establish military bases across Central Asia, and remain the dominant player in an area of that is set to become the most populous and prosperous region of the world…”

     

    “But one country has upset that plan, blocked that plan, derailed that plan. Russia. Russia has stopped Washington’s murderous marauding and genocidal depredations in Ukraine and Syria, which is why the US foreign policy establishment is so pissed-off.  US elites aren’t used to obstacles.”

     

    “For the last quarter of a century – since the fall of the Berlin Wall and the dissolution of the Soviet Union – the world had been Washington’s oyster. If the president of the United States wanted to invade a country in the Middle East, kill a million people, and leave the place in a smoldering pile of rubble, then who could stop him? …Nobody.  Because Washington owns this fu**ing planet and everyone else is just a visitor…Capisce?.”

     

    “But now all that’s changed. Now evil Putin has thrown up a roadblock to US hegemony in Syria and Ukraine. Now Washington’s land-bridge to Central Asia has been split in two, and its plan to control vital pipeline corridors from Qatar to the EU is no longer viable. Russia has stopped Washington dead-in-its tracks and Washington is furious.”

     

    “The anti-Russia hysteria in the western media is equal to the pain the US foreign policy establishment is currently experiencing. And the reason the foreign policy establishment is in so much pain, is because they are not getting their way.  It’s that simple. Their global strategy is in a shamble because Russia will not let them topple the Syrian government, install their own puppet regime, redraw the map of the Middle East, run roughshod over international law, and tighten their grip on another battered war-torn part of the world.”

     

    “So now… Putin must be demonized and derided. The American people must be taught to hate Russia and all-things Russian…Russia must be blamed for anything and everything under the sun…”

    Forget the charges of Trump-Russia collusion.  Trump’s main Russia problem is that he came into the White House from outside the elite Council on Foreign Relations (CFR) ruling class establishment Unlike the plugged-in U.S. power and imperial elite, the orange-haired brute never got the Zbigniew Brzezinski-crafted, David Rockefeller-endorsed CFR memo on the grave peril Moscow still poses to “the international system sponsored by the United States.”  (True, it’s unlikely that Trump could have followed the memo). Candidate Trump showed his lack of ruling class credentials by admiring Putin’s authoritarian manliness and calling for a stand-down from Obama and Hillary Clinton’s reckless, Brzezinski-esque provocation of the Kremlin in Eastern Europe and Syria. He foolishly called for normalized relations with the vodka-swilling Eurasian power that arose from the grave to once again become Washington’s “all-purpose [global] punching bag” (Whitney).

    After Herr Donald was ironically installed in the White House by leading Russophobe and  “lying neoliberal warmonger” (LNW) Hillary Clinton, Russia-hating took on a new and seductive political meaning for Democrats and their many U.S. media allies. The Russiagate narrative has proved irresistible to these actors for three basic reasons.

    First, they have naturally wanted to delegitimize the early Trump administration for standard partisan reasons. They’ve seen tarring Trump as a treasonous friend of a leading “foreign adversary” as useful for that purpose.

     

    Second, highly placed NATO-expansionist New Cold Warriors in both major parties (e.g., John McCain) and the media have wanted to keep the heat on Moscow. The baseless Russia election-hacking and collusion charges have been tools for the New Cold War camp to hedge in Trump’s promises of rapprochement with Russia. The Russiagate scam is part of why Clockwork Orangutan found it necessary to absurdly tell Russia to “give Crimea back” to Ukraine and why he theatrically launched 59 cruise missiles onto a Syrian airbase.

     

    Third, the Russian interference allegation has been made in part to help the DNC and the neoliberal Democratic Party establishment avoid responsibility for blowing the 2016 election. The Democrats ran a wooden, Wall Street-captive, and corruption-tainted candidate (the aforementioned LNW) and a vapid and elitist campaign that couldn’t mobilize enough working- and lower-class voters to defeat the epically noxious and unpopular Trump in key states like Pennsylvania, Wisconsin, Florida, Michigan and Ohio. The “Moscow stole it” narrative is a fancy version of “The dog [bear?] ate my homework” for a dismal dollar-drenched Democratic Party that abandoned the working class and the causes of peace, social justice and environmental sustainability long ago.

    The “inauthentic opposition” party (as the late Sheldon Wolin aptly described the neoliberal Democratic Party) would rather not take a long, hard and honest look at what it has become. It does not want to concede anything to those who dream (naively) of turning it into an authentic peoples’ and opposition party with a bold progressive vision and agenda. The “Russia did it” charge works for establishment Democrats hoping to stave off demands from leftish-progressive-populist types in their own party.

    This perverse political logic works to sustain the strange new neo-McCarthyite anti-Russian madness, which is rooted in the U.S. imperial agenda, not any relevant Russian influence on U.S. life and politics.

  • Enron 2.0? Asia's Largest Commodity Trader Halted After Crashing To 16 Year Lows On S&P Downgrade

    Once Asia's largest commodity trader, Noble Group has been halted after crashing almost 30% this morning following S&P lowering its corporate credit rist rating to CCC+, citing continuing weak cash flows and profitability…

    "We downgraded Noble because we believe the company's capital structure is not sustainable,"

     

    "The negative outlook on Noble reflects the potential that the company will face distress and a non-payment of its debt obligations over the next 12 months,"

    This is the lowest prices for the Singapore-based firm since 2001…

     

    This has been coming for a while, as we warned a year ago… Noble's "Margin Call" Part II – The Enron Moment

    By Simon Jacques

    "Our balance sheet – the strongest in recent history – represents a significant advantage as we continue to identify high value growth opportunities across the products and geographies we operate in. Maintaining our investment grade rating with the international rating agencies is a vital part of this strategy."     

    Noble Group 2014 Annual Report, p. 27

          * * * * *

    "Moody's Investors Service has downgraded Noble Group Limited's senior unsecured bond ratings to Ba1 from Baa3 and the provisional rating on its senior unsecured MTN program to (P)Ba1 from (P)Baa3."

          – Moody's, December 29, 2015

          * * * * *

    "Noble Group Downgraded To 'BB+' On Weakened Liquidity; Notes Lowered To 'BB'; Ratings Still On CreditWatch Negative"

         – Standard & Poors, January 7, 2016

    The story of Noble is worth writing a book, mostly of how not to run your business. 

    If they are in this mess, it is in large part because the management was comprised predominantly of traders who were predisposed to defend their books.

    Noble has been desperately trying to revive their image by hiring former Goldman, JP. Morgan, Trafigura executives etc. By doing so they were looking for a form of credibility collateral.

    It didn’t work well for the new employees as they rapidly found out that they inherited from the liabilities of one decade of Noble’s poor decision making of the hard-core asset guys like William J. Randall and ex-Goldman Sach banker Yusuf Alireza.

    In the part II of this analysis we will review the gap between the liquidity headroom and the debt maturity profile of the trader and explain how Noble Group will have its Enron moment.

    The fatal mistake that Noble Group did was apparently to mislead the market about their financial performance "presumably" by using accounting devices.

    During last November, Noble Group's chief financial officer Robert van der Zalm has stepped down from his position after taking a leave of absence for “health reasons”.

    Two months later,  Moody’s downgraded Noble Group.

    In a very awaited decision, Standard & Poor’s has finally lowered Noble Group’s to junk, placing Asia’s largest commodity trader on watch for further possible as the rating agency remains skeptical about the liquidity headroom of the trader.

    According to Noble Group, on September 30th 2015, the company had  $15.5bn banking facilities and $1.669B in RMI (ready marketable inventories).

    • $11.1bn of these $15.5bn banking facilities is uncommitted and are contingent on ability of maintaining investment-grade rating in the future.
    • Noble claims to have $900M of cash and 1.669B$ in RMI (ready and marketable inventories).
    • Their 1.669B$ in RMI have claims on related- party notes that are under collateralized by their commodity merchant activity and therefore should be excluded from their liquidity headroom.
    • Noble Group currently uses $3.4B of borrowing facilities that are uncommitted.

    Noble Group is left with only 1B$ of unutilized committed borrowing facilities and $900M of cash ready available to meet $2.966B of debt scheduled in the next 12 months.

    Source: Noble Group MD&A Q-3 2015

    Moreover, Noble Group counts on the completion of the Noble Agri stake divesture to reap $750M, a transaction which may not be completed by February 2016.

    Adding the 1B$ of unused uncommitted borrowing facilities plus the $750M of Noble Agri and the $900M of cash that Noble claims to have, Noble is still short by $316M.

    With the S&P downgrade, the total collateral margin call on Noble Group could be as much as $3.4B, banking facilities that are uncommitted and contingent on the ability of maintaining their investment-grade rating.

    Noble will have its Enron Moment.

    Enron's bankruptcy occurred on November 2001 and was triggered by S&P's downgrade of its debt below investment grade, activating a call provision in some loan indentures with principal amounts totaling $4 billion, cash and liquidity that suddenly Enron didn’t have.

    After the quick sale of Noble Agri, Noble’s core business remains its coal & energy – two very depressed commodities for the foreseeable future, and with no cash-flows to pay its debt and a sudden tightening of the credit, the trader is a cancer patient on the forward curve.

  • China's Bond Market Chaos Continues – Yield Curve Double-Inverts

    China's $1.7 trillion government-bond market is turning curiouser and curiouser

    In a fresh sign of the nerves among investors caused by Beijing's campaign this spring to make Chinese markets less risky, the yield on seven-year government bonds rose to 3.79% on Monday, above the yield on both five-year and 10-year bonds.

    The highly unusual move means that China's government-bond yield curve now resembles a triangle, with the seven-year yield at its highest since October 2014. Furthermore, the Chinese curve has a double-inversion 3s to 5s and 7s to 10.

    In fact the 3s10s spread is the most negative ever…

    The shift comes less than two weeks after the government-bond yield curve became inverted for the first time on record, with 10-year yields–now at 3.65%–lower than those for five-year bonds, currently at 3.68%. Normally investors demand higher yields on bonds that have longer to go until maturity.

    Intriguingly, 30Y US Treasuries and 3Y China Treasuries have traded very tightly coupled at the same level for 6 years…

    "We are seeing a butterfly on our screen that we have never seen before, " said a Shanghai-based senior bond trader at a local mutual fund.

    The continued pressure on Chinese bonds (and stocks) is driven by both technical flows (China's ongoing crackdown on leverage in the financial system spewing out into the shadow banking system and hitting retail), and expectations for growth in a lower credit growth world (which has crushed the yield curve).

    Just last night brokerage shares slumped as Chinese authorities blocked off-'channel' operations, barring securities firms from helping banks take loans off balance sheets…

    As The Nikkei Asian Review reported, Chinese authorities have begun cracking down on brokerages engaged in the profitable business of helping banks keep inconvenient loans or assets off the books, sparking a broad slide among Shanghai-listed securities firms Monday.

    The China Securities Regulatory Commission on Friday banned so-called channel business helping banks convert on-the-books loans and notes into off-balance-sheet financial instruments, announcing the audit of an investment fund facilitating such transactions. The activities enable lenders to circumvent caps on loan-deposit ratios, for example.

    Channel business is a significant source of fee revenue for brokerages but amounts to a firm abandoning its responsibility as an asset manager, the securities commission said.

    The resulting murky wealth management products form a cornerstone of China's shadow banking system, offering investors high returns in exchange for significant risk. The country's banks handle some 29 trillion yuan ($4.21 trillion) in such products. Regulators fearing such risk factors as defaults have stepped up a crackdown on shadow banking since April.

  • Buy The F**king Brazilian Political Crisis Dip

    Nothing says "go all in" on Brazilian stocks like the one of the biggest equity market drops on record following yet another political crisis… and that's just what investors did.

    Second only to the collapse surrounding Lehman's branruptcy, EWZ (the Brazil ETF) crashed over 16% last week (before rebounding)…

    But it appears, the political crisis around President Michel Temer couldn’t have come at a better time for the U.S. exchange-traded fund that invests in Brazilian stocks. The ETF had gone more than seven weeks without any deposits as investors questioned whether the equity rally had gone too far. But the 16 percent plunge on Thursday eased those concerns, and investors added $345 million to the fund, the biggest single-day inflow since Jan. 6, 2011…

    Pent up demand?

    It seems not, as while the Real is bid, Brazilian stocks are still languishing…

    Despite headlines that Temer's court hearing had been delayed today… stocks saw no love to end down 1.5%.

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  • North Korea's Latest Missile Test Brings Us One Step Closer To WWIII (Here's How We Got Here)

    As time goes on, North Korea’s nuclear program is making war with the United States more and more likely. As SHTFplan.com's Daniel Lang details, we’re on a terrible path that no one knows how to escape from.

    On the one hand, North Korea is clearly led by an unhinged and tyrannical government that can’t be trusted with nuclear weapons. So you can understand why the US is so determined to stop their progress with these weapons. But at the same time, those nuclear weapons could one day guarantee that the leaders of North Korea will remain in power for a long time. Those weapons would make any potential aggressor think twice about trying to invade the bellicose nation, so there’s no way that North Korea is going to abandon its nuclear program.

    Perhaps the only thing that’s preventing a war from breaking out right now, is the fact that North Korea doesn’t have an effective way to deliver a nuke, nor have they been making much progress in that arena. It seems like every time they test a long range missile, it fails spectacularly. So long as that state of affairs continues, war can be averted.

    Unfortunately, North Korea’s missile program has just made a huge leap. On Sunday they tested a new missile that was arguably far more effective than anything they’ve ever launched before.

    A Hwasong-12, a new medium long-range surface-to-surface missile, was launched from Kusong early Sunday morning. The missile flew roughly 430 miles, but the weapon was intentionally lofted. Analysts suspect the missile could potentially hit targets 2,800 miles away if fired along a standard trajectory.

    In other words, the missile was launched with a steep arc, as a opposed to a relatively flat trajectory. This was done so that the missile could be tested without launching it over any neighboring countries. Most experts believe that if the missile had been given a flatter trajectory, it could have reached American military assets throughout much of the Pacific.

    The North “appears to have not only demonstrated an intermediate-range ballistic missile (IRBM) that might enable them to reliably strike the U.S. base at Guam, but more importantly, may represent a substantial advance to developing an intercontinental ballistic missile (ICBM),” John Schilling, a respected aerospace engineer who specializes in rockets, explained.

     

    With the ability to strike Guam, the North may now have the means to strike most major U.S. strategic assets in East Asia and the western Pacific. While this would be an impressive achievement, North Korea is determined to master ICBM technology. The missile tested Sunday may be the predecessor to a future ICBM.

    Is it any wonder why  North Korea is the perfect trigger for World War 3? This unstable nation is rapidly increasing its nuclear capabilities, and it’s a nation that China and Russia have a vested interest in keeping alive. They want a buffer state between their borders and South Korea, which is allied with the United States. So any conflict with North Korea (a conflict that is looking more likely every day) could easily drag more nuclear armed nations into the fray.

    Unless one side of this fight backs down, World War 3 is inevitable. And so far it doesn’t look like either side is willing to compromise on North Korea’s missile program.

    And here is how we got here, courtesy of Goldman Sachs – The Timeline of North Korea Developments

     

    Finally, Goldman's Jeff Currie and Mikhail Sprogis discuss gold as a hedge against geopolitical events

    …we find that gold can effectively hedge against geopolitical risk if the geopolitical event is extreme enough that it leads to some sort of currency debasement, and especially if the gold price move is much sharper than the move in real rates or the dollar. For these events, gold essentially serves as a call option and can therefore be thought of as a “geopolitical hedge of last resort.”

    …This analysis, however, doesn’t take into consideration gold market liquidity itself, which can be crucial when deciding to hedge via physical gold in a vault versus COMEX gold futures.

    Using a gold futures contract as the basis of the hedge makes the implicit assumption that market liquidity will not be a problem in the realization of a geopolitical event. The importance of liquidity was tested during the collapse of Lehman Brothers in September 2008. Gold prices declined sharply as both traded volumes and open interest on the exchange plummeted. After this liquidity event, investors became more conscious of the physical vs. futures market distinction and began to demand more physical gold or physically-backed ETFs as a hedge against black-swan events.

    The lesson learned was that if gold liquidity dries up along with the broader market’s, so does your hedge – unless it is physical gold in a vault, the true “hedge of last resort.”

  • Gnome Underpants Gold Model, Report 21 May, 2017

    There is a often-promoted plan to grow your wealth. Here’s the background. The dollar is going to be worthless. Soon! The reason is because [their peeps in high places tell them / the Chinese / end of the petrodollar / historical fiat currencies / Rothschild Jekyll Island Master Plan Private Fed / Fed printing] will cause the dollar to collapse and gold will rocket to $50,000. In fact, it’s a miracle that the price is a mere $1,253 and it hasn’t already. It will, once people discover this One Weird Secret that They Don’t Want You to Know that we have been reiterating every day for decades.

    (By the way, Monetary Metals is about to publish the data to finally shine the full sunlight of disinfectant on this—stay tuned)

    The plan has three phases.

    Phase 1: You gotta buy gold. Now. In fact, call 1-800-BUY-GOLD now! That number, again, is one eight hundred bee yoo wye gee oh ell dee.

    Phase 2: Price goes up

    Phase 3: Profit!

    This is a bit reminiscent of the underpants business model on South Park. South Park of course showed phase 2 as “???” but the analogy holds.

    Pay particular attention to the context switch. The story switches midway from the-dollar-will-collapse to gold-will-go-up.

    In fact, these are the same thing. It is important to realize because a higher price of gold does not make you richer. Sure, you have more dollars but each of them is worth proportionally less. And why would you want to exchange your gold for collapsing Rothschild private bank petrodollar printing press Monopoly money? On top of this, the tax man will take a big chunk of any price appreciation. So, if you sell you have less wealth.

    Aside from being wrong as a matter of fact, it is an example of dollar thinking. It comes from the belief that gold is to be sold. That is not historically how people thought about it. Gold is money and those who have it should seek to earn a return on it, not sell it.

    This week, the prices of the metals went up. Perhaps that rubber stopper under the silver elevator is durable.

    However, as always we are interested in the supply and demand fundamental of the metals. We will show graphs, but first, the price and ratio charts.

    The Prices of Gold and Silver
    The Prices of Gold and Silver

    Next, this is a graph of the gold price measured in silver, otherwise known as the gold to silver ratio. It moved lower this week.

    The Ratio of the Gold Price to the Silver Price
    The Ratio of the Gold Price to the Silver Price

    For each metal, we will look at a graph of the basis and cobasis overlaid with the price of the dollar in terms of the respective metal. It will make it easier to provide brief commentary. The dollar will be represented in green, the basis in blue and cobasis in red.

    Here is the gold graph.

    The Gold Basis and Cobasis and the Dollar Price
    The Gold Basis and Cobasis and the Dollar Price

    We changed to the August contract.

    August is far from expiration, and we see no sign of temporary backwardation (another phenomenon that disproves the naked short manipulation theory). And we see something clear and revealing. There is a steadily rising scarcity (i.e. the cobasis, the red line) and falling abundance (the basis, the blue line). The trend has been ongoing for many months, with not a lot of jitter. The scarcity of gold, as indicated by the August gold spreads, has been on the rise.

    For somewhat less time, the price of gold has been rising.

    Our calculated fundamental closed the week up another $21, to $1,275. That’s hardly “call 1-800-BUY-GOLD now before it hits $10,000” territory, but noteworthy nonetheless.

    Now let’s look at silver.

    The Silver Basis and Cobasis and the Dollar Price
    The Silver Basis and Cobasis and the Dollar Price

    Last week, we said that “silver does not yet show any backwardation, though it’s close at -0.03%.” This week, it’s +0.1%. However, this is definitely temporary backwardation. The near contract in silver tends to fall earlier than the near contract in gold.

    Obviously, past a certain date, speculators looking to bet on silver would not buy the July contract but instead the September. Everyone may have his own boundary, in part depending on how long they want to hold the position. But clearly, for the marginal silver speculator, we are past that point in the July contract.

    So there is an imbalance, less and less buying. The selling (to roll July) may not be urgent yet, but silver is less liquid than gold. So a small imbalance will show up as a change in basis.

    Our calculated fundamental price of silver was down a few pennies.

    We will end on an amusing note. The previous week, we said:

    “We saw a technical analysis trader write a note this weekend. He said he plans to short silver on Monday. When the technicals and then fundamentals align, that can make for an interesting week.”

    Assuming he shorted it early on Monday morning, he might have top-ticked it at $16.40. On Tuesday, he could have closed at $16.05, for a gain of 2.1%. There has to be an easier way to earn a few bucks (and we never recommend naked-shorting gold or silver).

    Well, as of Friday silver is $16.84. Depending on how much leverage he used, that could be a big owwie.

    Keith will be speaking at the Mining Investment Europe event in Frankfurt in mid-June. He will be in London the week of June 19, and in New York the week of June 26. If you’re interested in attending a Monetary Metals seminar on GOFO and transparency in the gold market in either city, or to meet with Keith to discuss gold investment, please click here.

    © 2017 Monetary Metals

  • World Leaders Gather In Beijing While The US Sinks Into Irrelevancy

    Authored by Wayne Madsen via The Strategic Culture Foundation,

    While vaudevillian comedy-like shouting matches broke out in the West Wing of the White House between President Donald Trump and his senior advisers and between the White House press secretary and various presidential aides, world leaders gathered in Beijing to discuss the creation of modern-day land and maritime «silk roads» to improve the economic conditions of nations around the world. Nothing more could have illustrated the massive divide between the concerns of many of the nations of the world and those of the United States, which is rapidly descending into second-rate power status, along with its NATO allies Britain, France, and Germany.

    While Mr. Trump was threatening to fire his senior White House staff, reprising his one-time role in his reality television show «The Apprentice», China’s President Xi Jinping, Russian President Vladimir Putin, and presidents and prime ministers from around the world sat down to discuss the creation of new international and intercontinental highways, railways, and maritime routes under China’s proposed Silk Road Economic Belt and the 21st Century Maritime Silk Road.

    Even countries that are cool on the Chinese initiative, including India and Japan, sent representatives to the summit that carried a bit more clout than the pathetic representation of the United States, Matt Pottinger, a little-known special assistant to Trump and the senior director for East Asia of National Security Council. In fact, the only reason Trump sent anyone to represent the United States at the Beijing gathering was because of a special request made by President Xi during his recent meeting with Trump at the president’s private Mar-a-Lago Club resort in Palm Beach, Florida.

    South Korea, which saw relations with China sour over America’s placement of Terminal High Altitude Area Defense (THAAD) missile system in South Korea, sent a delegation to Beijing after a phone call between South Korea’s new liberal president, Moon Jae-in, and President Xi. Moon responded to the phone call by sending a delegation led by his Democratic Party’s veteran legislator to Beijing.

    Even North Korea, which rankled South Korea, Japan, and the United States by firing a ballistic missile into waters near Russia, sent a delegation to the Beijing meeting headed by Kim Yong Jae, the North’s Minister of External Economic Relations. The Trump administration, which sent a virtual unknown to Beijing, complained loudly about North Korea’s representation at the Silk Road summit. But Washington’s complaint was conveyed by someone as unknown as Mr. Pottinger, Anna Richey-Allen, a low-level spokesperson for the U.S. State Department's East Asia Bureau. The reason why the United States is being spoken for by middle-grade bureaucrats is that the nation that still believes it is the world’s only remaining «superpower» is now governed by an administration rife with top-level vacancies, inter-agency squabbling, and amateur league players.

    Even though major European Union member states were not represented in Beijing by their heads of government, Germany sent its Economy Minister, Brigitte Zypries. She warned, however, that the EU would not sign a Silk Road agreement with China unless certain EU demands on free trade and labor conditions were guaranteed. Germany’s reticence did not seem to faze other EU nations, which were represented in Beijing by their heads of government and appeared to be more avid in their support of the Chinese initiative. These EU member state leaders included Italian Prime Minister Paolo Gentiloni, Spanish Prime Minister Mariano Rajoy, Polish Prime Minister Beata Szydlo, Greek Prime Minister Alexis Tsipras, Czech President Milos Zeman, and Hungarian Prime Minister Viktor Orban. Moreover, had British Prime Minister Theresa May not been in the middle of a general election campaign, she would have been in Beijing. Nevertheless, she sent British Chancellor of the Exchequer Philip Hammond in her place.

    If the Trump administration hoped to convince world leaders to stay away from Beijing, it was sorely disappointed. The United Nations Secretary General, Antonio Guterres, was there, along with the President of the World Bank Jim Yong Kim and International Monetary Fund Managing Director Christine Lagarde. Also present in Beijing were the presidents of Turkey, Philippines, Argentina, Chile, Indonesia, Kyrgyzstan, Belarus, Kazakhstan, Switzerland, Kenya, Uzbekistan, and Laos, as well as the prime ministers of Vietnam, Pakistan, Sri Lanka, Serbia, Malaysia, Mongolia, Fiji, Ethiopia, Cambodia, and Myanmar.

    Ministerial delegations from Afghanistan, Australia, Azerbaijan, Bangladesh, Brazil, Egypt, Finland, Iran, Kuwait, Lebanon, Maldives, Romania, Nepal, New Zealand, Saudi Arabia, Singapore, South Sudan, Sudan, Syria, Tanzania, Thailand, Tunisia, Uganda, and the United Arab Emirates were at the Beijing summit. Japan was represented by the senior adviser to Prime Minister Shinzo Abe and Secretary General of the Liberal Democratic Party, Toshihiro Nikai. France, which was experiencing a change of presidents, sent former Prime Minister Jean-Pierre Raffarin.

    The Silk Road initiative has projects planned in all the nations whose governments were represented in Beijing, except for the United States and Israel. In addition to the nations represented by their government heads of state and ministers, Silk Road agreements were signed between China and Palestine, Georgia, Armenia, Bosnia and Herzegovina, Montenegro, Albania, Tajikistan, Brunei, Croatia, and East Timor.

    The one clear message the Beijing meeting sent out to the world is that America’s «unipolar» vision of the world was dead and buried. Even among Washington’s longtime friends and allies, one will not hear Donald Trump referred to as the «leader of the Free World.» That phrase has been discarded into the waste bin of history along with America’s insistence that it is the world’s only «superpower.» The United States is a power, a second-rate one that happens to possess a first-rate nuclear arsenal. But nuclear weapons were not being discussed in Beijing. Major projects were on the agenda, projects that when completed will leave the United States at sea in the propeller wash.

    President Xi, in his keynote address to the conference, said that the «One Belt and One Road» initiative is «a project of the century» and that will benefit everybody across the world. And to put his money where his mouth is, Xi said China will contribute 80 billion yuan (US$113 billion) as added financial impetus to create a global network of highway, railway, and maritime links in a recreation of the ancient Silk Road that linked China to the West. Meanwhile, in Washington, Trump spoke of having recorded «taped» conversations with his fired director of the FBI James Comey, setting off a political firestorm. A new global infrastructure being spoken about in Beijing and political hijinks the major topic of conversation in Washington. The United States has fallen into second-rate global status and is seriously ill as a cohesive nation-state but does not even realize it.

    China and Russia used the Beijing summit to showcase several Eurasian initiatives, including the Russia-inspired Eurasian Economic Union (EEU) and the China-initiated Asian Infrastructure Investment Bank (AIIB). Both the Chinese and Russian heads of state let it be known that the BRICS alliance of Brazil, Russia, India, China, and South Africa was still a potent world entity, even though South Africa was not represented in Beijing by its president and India chose not to send any representative to Beijing.

    President Putin’s words to the conference about the new geopolitical status in the world were noteworthy: «the greater Eurasia is not an abstract geopolitical arrangement but, without exaggeration, a truly civilization-wide project looking toward the future.» In other words, the European Union, which is losing the United Kingdom as a member and will never see membership for Turkey, is a dying international organism. Other international initiatives, like the EEU, BRICS, AIIB, and the One Belt, One Road (OBOR), are leaving the EU and the United States in the dust. That was evident by the fact that the United States was represented in Beijing by an overrated desk clerk and the EU by a Brussels «Eurocrat,» the European Commission vice president Jyrki Katainen.

  • Shocking Admission From NY Bankruptcy Judge: "Chapter 11, 15 Filings Have Exploded"

    A stunning soundbite was captured by a Bloomberg reporter during last week’s event at the American Bankruptcy Institute. According to judges speaking at an ABI conference Thursday in Manhattan, the U.S. Bankruptcy Court for the Southern District of New York is seeing a sharp rise in cases this year, with Chapter 11 and Chapter 15 filings outpacing national averages.

    “Chapter 11s and Chapter 15s have exploded” said U.S. Bankruptcy Judge Shelley Chapman, speaking at American Bankruptcy Institute event, cited by Bloomberg reporter Tiffany Kary.

    The numbers for the bankruptcy court which serves Manhattan are, frankly, horrifying: Chapter 11s have tripled in the first quarter of the year, while Chapter 15s for companies seeking U.S. aid for a reorganization in a foreign court have increased sevenfold, Chapman added.

    What makes New York data so dramatic is that the region’s bankruptcy filings contrast with national data, that show Chapter 11 filings are down slightly, Judge Carla Craig from Eastern District of New York said.

    New York is not alone it seems: As Bloomberg adds, Judge Brendan Shannon from Delaware said he has also seen an uptick in Chapter 11s and Chapter 15s, though not as marked as in New York. Shannon also sees trend in retail and energy sector bankruptcies continuing, based on current cases .

    The culprit? Take one guess:

    “The report is that for at least a lot of retailers, it is certainly a difficult, if not flat out impossible environment to operate in,” Shannon said. “We do see more of those cases likely on the horizon.”

    And while we appreciate the transfer of business from bricks and mortar retail to online, it is simply impossible that the millions of soon to be laid off legacy retail, minimum-wage workers will find suitable employment in the coming retail bankruptcy tsunami (which will claim the following 11 names next according to Fitch), and which will unleash a tidal wave of bankruptcies first across New York, and soon after, across the entire US. How far this particular destructive tsunami of default will reach, and how fast, will determine just how acute the next recession will be.

  • Softbank Chairman Making Good On Promise To Invest Billions In the US

    Looks like Softbank Group Chairman Masayoshi Son is making good on his promise to invest billions and create tens of thousands of jobs in the U.S.

    The Softbank Vision Fund, now the world’s largest private-equity fund, announced on Saturday that it has raised over $93 billion to invest in technology like artificial intelligence and robotics, Reuters reported.

    Trump tweeted back in December that Masayoshi Son had promised to invest $50 billion in the U.S. – something that, according to Trump, wouldn’t have happened if Hillary Clinton had won the election.

    The announcement coincided with President Donald Trump’s visit to Saudi Arabia – his first trip abroad as president – and the signing of billions of dollars’ of deals between the two countries, including a $350 billion arms deal that’s been tagged as the largest ever. Softbank Group and Saudi Arabia's Public Investment Fund, the kingdom's sovereign-wealth fund, have partnered the create the fund, which also has received contributions from deep-pocketed investors including Abu Dhabi's Mubadala Investment, which has committed $15 billion, Apple Inc, Qualcomm, Taiwan's Foxconn Technology and Japan's Sharp Corp.

    The fund is still hoping to reach $100 billion and expects to complete its money-raising in six months, according to Reuters.

    We're looking forward to the flood of leveraged buyouts that will likely follow.

  • "Baizuo" Is The New Derogatory Term Millions Of Chinese Are Using To Describe America's "White Left" Regressive Liberals

    Authored by Daniel Lang via SHTFplan.com,

    After the last election, the far-left in our society became a laughing stock. The social justice warriors, the progressives, the regressive left; whatever you want to call them, they became a joke after Trump was elected. And it wasn’t because they lost the election. It was because of how they reacted to losing. We all witnessed what amounted to a nationwide temper tantrum on November 9th. And in the weeks that followed, it became apparent that these people aren’t just childish. They are freaking insane.

    However, it may surprise you to learn that these people aren’t just a joke in America. They are the laughing stock of the world. They are looked down upon, even in countries where they don’t have a significant presence.

    In China for instance, they have a word for these people. They are called “baizuo” or the “white left” on social media. Which is interesting, because even though China has its fair share of socialists and communists, they don’t have a direct equivalent to our liberal snowflakes. Most of the Chinese are still fiercely nationalistic and anti-immigrant, regardless of political affiliation. That country just doesn’t have a large population of politically correct, affluent liberals (presumably, they were all killed off during the Great Leap Forward). So what does this term mean to the average Chinese citizen?

    It might not be an easy task to define the term, for as a social media buzzword and very often an instrument for ad hominem attack, it could mean different things for different people. A thread on “why well-educated elites in the west are seen as naïve “white left” in China” on Zhihu, a question-and-answer website said to have a high percentage of active users who are professionals and intellectuals, might serve as a starting point.

     

    The question has received more than 400 answers from Zhihu users, which include some of the most representative perceptions of the ‘white left’. Although the emphasis varies, baizuo is used generally to describe those who “only care about topics such as immigration, minorities, LGBT and the environment” and “have no sense of real problems in the real world”; they are hypocritical humanitarians who advocate for peace and equality only to “satisfy their own feeling of moral superiority”; they are “obsessed with political correctness” to the extent that they “tolerate backwards Islamic values for the sake of multiculturalism”; they believe in the welfare state that “benefits only the idle and the free riders”; they are the “ignorant and arrogant westerners” who “pity the rest of the world and think they are saviours”.

    Baizuo has basically become the go to word for Chinese social media users, who want to trash other people in online debates. It’s also frequently used to make light of what is viewed in China, as the inherent weakness of western democracies. So not only has the far-left made themselves into a joke, they’re making everyone else who supports Western civilization look bad all around the world.

    It just goes to show, the people who speak the loudest in society often become the face of that society, even if most sane people aren’t taking them seriously anymore.

  • Timeshare Fraud – the hot new securities fraud

    Every now and again we at Elite E Services stumble upon business models in the course of our operation that are sometimes interesting but alarming at the same time – in this case, timeshare fraud.  After having our head held under water by combination of ugly circumstances (tough regulation making business impossible but at the same time losing millions to Forex fraudsters which ironically the regulations failed to stop); we are sensitive on fraud – especially that which does not appear to be on the surface!  And as markets evolve, so do fraud models.. 

    With the conviction of stock lending fraud master and citizen of Boca Raton Florida Jeffrey Spanier, stock lending fraud is on the way out:

    SAN DIEGO – Jeffrey Spanier, a 51-year-old former owner of Amerifund Capital Finance, LLC located in Boca Raton, Florida, was convicted by a federal jury today for his role in an elaborate stock-loan fraud scheme in which executives and shareholders of publicly traded corporations collectively lost over $100 million when the stock they pledged as collateral for loans was immediately sold in order to fund the loans.

    Why this is a good example though – this fraud was perpetrated at the highest levels.  Victims of this fraud included the who’s who of Wall St., corporate executivies, ultra high net worth individuals, and even Bono (

    This may have to be a multi-part series as we uncover this new type of fraud which may be the next big ‘securities fraud’ as what we are looking at – appears to be unregistered securities.  Let’s start with a short history of what a timeshare is and how we got where we are.  

    Long ago, before the dinosaurs, the Johnson family wanted to share their lake cottage with the Smith family for the summer, and asked them to kick in for the repairs of the old dock.  Or something like that.  And then it became a business – of course starting from the infamous Fort Frauderdale, Florida (during this time Boca Raton was still a swamp, inhabitied only by IBM and some Japanese..)

    The first timeshare in the United States was started in 1974 by Caribbean International Corporation (CIC), based in Fort Lauderdale, Florida. It offered what it called a 25-year vacation license rather than ownership. The company owned two other resorts the vacation license holder could alternate their vacation weeks with: one in St. Croix and one in St. Thomas; both in the U.S. Virgin Islands. The Virgin Islands properties began their timeshare sales in 1973 with owners Hillie Meyers, Don Saunders, and Arthur Zimand.

    How we got to where we are today follows the same path of all industries; fuelled by Fed policy of cheap money, an expanding real estate market, retiring rich baby boomers, and all the other favorable demographics.  But what insiders in this industry learned quickly was that, they were really selling the dream.  It was possible to sell the nothing, the artificiality.  “Real” estate is just that – it’s real.  Timeshare owners don’t really ‘own’ anything, if you read the agreements – it’s a contract to pay, an obligation – in perpetuity.  Every time share contract is different but in no case is there actual ownership of ‘real estate’ – you may own the ‘rights’ to a ‘membership’ but if it cannot be ‘sold’ then what kind of ownership is that really?  What they learned was that the profit here was all in the sizzle, not in the steak – and if they could enhance the sizzle to be 99% and serve Grade B flank steak, they’d have a winning model to become very rich, which was borderline legal.  While the timeshare industry itself is ‘legal’ and in some states there are ‘regulations’ – many of the tactics they use, contracts they offer, are illegal.  Many of the ‘salespeople’ they hire, have criminal records for financial fraud.  In fact, the FTC currently has hundreds of criminal investigations against timeshare companies, timeshare resale scams, timeshare fraud, and related illegal activities.  Similar to how the Forex fraud we saw had nothing to do with Forex, many of these frauds have nothing to do with timeshares.  People are so desperate to sell their obligations, when a scammer calling from Mexico says he can ‘resell’ your timeshare (which is practically impossible) hopeful victims wire thousands of dollars to the foreign bank account with little respute.  Doesn’t sound like a lot of money for a scam, but – multiplied by the 10 Million timeshare owners out there, this can add up to millions of dollars for the fraudsters.

    When you ‘buy’ a timeshare ‘contract’ it’s sort of like a debt, you are obligated to pay and if you die, your children will inherit the payments.  Sounds a lot like a bond!  Yes, these are unregistered securities.  The ‘exchange’ as they call it, RCI, is an unregistered exchange.  There are issues with the SEC, the CFTC, the states, and possibly even anti-trust issues.  Some of these issues are starting to be talked about in the financial media:

    Summary

    • Analysts upgrading HGV are not considering the ‘dark side’ of this industry.
    • Potential liabilities can spring up anytime that can change this tune.
    • Angry customers complain, which can soon become lawsuits, with deleterious consequences.

    About half of the big timeshare companies are public companies, so here’s where the biggest issues lie.  Because public companies are required to follow rules such as disclosure rules that don’t apply to private companies.  So this may be where we see the first complaints.

    Really what it comes down to, is a broken model.  Not all timeshares are frauds – but in an inflationary environment, is such a model – fraud removed – profitable anymore?  It’s like the Series 7 stockbroker, who used to charge a percent of the trade – now anyone can place their own trade for $9.99 or less whilst sitting in their bathrobe petting their cat.  The timeshare model is a broken bricks and mortar model from the past, it’s dead like the shopping mall is dead, just like Amazon is killing retail stores, new upstarts that remain to be seen (still do not exist) will cannabalize this rotten model.  In the meantime, there’s a lot to be decided in court.

    Even according to industry ‘official’ statistics, about 17% of timeshare owners are not happy.  Although Diamond is now private and bigger companies have ‘cleaned up’ their act, reports of false imprisonment, fraud by trickery, misleading sales statements, and outright refusals to comply with customers requests, and just a few of the things still going on.. just read sites like this Consumer Reports (RCI): 

    We see no reason to sign up for RCI except to give the company money. We are new members who tried to use RCI for the first time. We wanted to visit El Dorado Suites, Riviera Maya, using our exchange. Through RCI, we have to pay a $399 fee for a mandatory 7-day visit. RCI requires we also pay a $2500 “Mandatory all inclusive” fee for the El Dorado. So that’s the cost of our RCI membership, plus a $399 fee, plus a $2500 all-inclusive fee. Curious, we logged into El Dorado’s home page and found we could sign up for the exact same vacation, not using RCI, for a total cost of $2200, also all-inclusive. So the all-inclusive fee alone is more than the actual cost of staying at the El Dorado Suites, without having ever met an RCI salesperson.

     

     

    I have been with RCI approx 12yrs. My previous issues have been the fact that they charge for unused points… Live and learn. My complaint is that I had to cancel a reservation. It’s unfortunate but situations do arise and plans have to get changed. I cancelled 5-days prior to my check-in date. RCI WILL NEITHER REFUND NOR CREDIT my charge of $99.00! They say they have a 24-hour ‘grace period’. I feel this is a major RIP-OFF to consumers and extremely bad business practice. I have contacted them by email, customer service and ‘blabbering’ supervisor. I was told “they have to keep the lights on” in order to provide their service. Well, RCI, my lights need to be on as well!! BUYER BEWARE.

    You get the idea.  One can spend a weekend reading these, it does make more interesting reading than outright financial fraud, but eventually it will make you want to vomit.  You can’t call this a business model – you have to call it ‘fraud’ or ‘scam’ because it’s like that.  If normal companies operated like this, they’d be shut down.  Imagine walking into Wal Mart and instead of their ‘no questions asked’ return policy they argued with you and told you there was a ‘grace period’ or some such nonsense, there would be riots, boycotts – Wal Mart would be no more.  90% of business operates like that.  The only exception is software sales because practically, once you ‘download’ the software you can copy it and there’s no way to prove that you didn’t.  Other than that – and some other rare exceptions, you can’t lock people in a room for 8 hours without their permission.  Readers – this is a time-bomb waiting to explode!  How can we profit from it?  Short the stocks; (HGV) (WYN) (VAC) et al   

    If you own a timeshare and want out, there are only a few lawfirms who are actually law firms who can do this for you, like this one Fortis Law Group PLC.  There are also hundreds of scam companies claiming to be ‘timeshare resale experts’ who even have ‘licenses’ to do this – but beware – this is a scam too!  This industry is filled with fraud from one end of the business cycle to the other.  It can only be explained by George Carlin, with this clip:

    We know what we have to do.  Let’s get working!

    For a detailed breakdown of how the financial system works (in reality – not how it is supposed to work) – checkout Splitting Pennies Understanding Forex.

    Visit our sponsor Please Order It.com

  • 'Tolerant'? Cali Democratic Chair Urges Crowd "All Together Now, F**k Donald Trump"

    Once again the left exposes itself as the "do as we say, not as we do" party of tolerance, non-violent protest, and free speech…

    As Gateway Pundit's Cristina Laila reports, the classless Democrats gathered in Sacramento for a state convention on Saturday. They had some harsh words for the President as they chanted, ‘F*** Donald Trump!’.

    AP reports:

    California’s elected Democrats had tough words for President Donald Trump and the GOP Congress on Saturday, urging their party’s fired-up activists to work against the 14 Republicans in the state’s congressional delegation.

     

    The party’s leaders blasted Trump’s alleged ties to Russia and presented California as the epicenter of liberal resistance to the president.

     

    “The world, literally the world, is counting on all of you, counting on California to reject Trump’s deception and destructiveness,” said Lt. Gov. Gavin Newsom, who is among a crowded field of Democrats running for governor next year.

     

    U.S. Sen. Kamala Harris, often mentioned as a potential candidate for president in 2020, accused Trump of putting “Russia first, America second.”

     

    In a sign of the vigor of the party’s distaste for the president, outgoing party Chair John Burton, a longtime Democratic lawmaker and powerbroker known for his blunt and profane manner, extended two middle fingers in the air as the crowd cheered and joined him.

     

    “F— Donald Trump,” he said.

    Video of crowd with middle fingers in the air after outgoing CA Dem Chair, John Burton screamed, ‘F*ck Donald Trump!’

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    Video of Ca Dem Chair, John Burton telling protesters to ‘shut the f*** up!

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    This is the Democrat party, folks…what a bunch of classless lowlifes…

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    More F-bombs from John Burton…(language warning)

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  • It Takes A Bullshitter To Know A Bullshitter

    Authored by Duane Norman via Free Market Shooter blog,

     

    On Wednesday, PEOPLE Magazine released a preview of an upcoming issue, titled “The Obamas; Their Lives Now”, which includes commentary on Obama’s “relationship” with President Trump:

    “He’s nothing but a bullsh–ter.”

    Tell us how you really feel, Obama, because after your oval office meeting with Trump, we never would have guessed that you two hated each other.

    But isn’t this a major case of hypocrisy on Obama’s part, with a track record of lies and “bullshit” miles long?

    So let’s take a minute and recap all of the bullshit former President Obama told the American public during his tenure.  It’s the only fitting rebuttal, isn’t it?

    But first, let’s start with the biggest hunk of bullshit out there – the fact that Barack and Michelle, after eight years as President and First Lady, actually did a photo shoot and cover spread for PEOPLE magazine.  It isn’t difficult to believe they did it, but seeing it is another thing altogether:

    After eight years, George W. Bush remained completely quiet through the entire Obama presidency; in fact, he spent a great deal of his time painting, of all things.  Bill Clinton racked up millions of dollars of speaking fees and got his wife a Senate seat, but never criticized or mentioned Bush at all during his term.

    Meanwhile, it appears Obama misses being the celebrity-in-chief, as this magazine spread indicates, but how about PEOPLE’s claim and citation of David Axelrod in regards to the unspoken rule that ex-Presidents don’t criticize the current commander in chief?

    But the former president has been meticulous since the election about not publicly violating that unwritten code of conduct among ex-presidents that bars criticizing whoever’s currently in the Oval Office.

     

    “He’s very respectful of the appropriate role of a former president and that ex-presidents should not be looking over the shoulder of their successors and commenting on every decision,” says Obama’s long-time friend and political strategist David Axelrod, now director of the University of Chicago’s Institute of Politics, noting how George W. Bush refrained from criticizing Obama.

    In what world is Axelrod (and conversely PEOPLE magazine, for publishing his commentary) living in, in which Obama has not criticized President Trump?  Less than ten days after Trump took office, Obama did just that:

    Through his spokesman, Mr. Obama said he was “heartened” by all of the anti-Trump protests that have erupted throughout the nation.

    If you think Barack was the only Obama who criticized Trump, you’d be wrong as well:

    Michelle Obama on Friday criticized a Trump administration decision to delay federal rules aimed at making school lunch healthier, saying kids will end up “eating crap” instead.

     

    “You have to stop and think, ‘Why don’t you want our kids to have good food at school? What is wrong with you and why is that a partisan issue?” Mrs. Obama said. “Why would that be political?”

    So much for that “unwritten code” Axelrod said Obama was upholding.

    Of course, it hardly tops Obama’s biggest bullshit quote(s) of all:

    “That means that no matter how we reform health care, we will keep this promise to the American people: If you like your doctor, you will be able to keep your doctor, period. If you like your health-care plan, you’ll be able to keep your health-care plan, period. No one will take it away, no matter what.”

     

    “And if you like your insurance plan, you will keep it.  No one will be able to take that away from you.  It hasn’t happened yet.  It won’t happen in the future.”

    Even The Washington Post, of all places, was completely unable to defend Obama’s multiple quoted assurances; as The Daily Caller indicated on Jan 1, 2014, when the law took effect, 4.7 million Americans lost their health insurance because of Obamacare, with reports of far more cancellations at later dates.

    Of course, as Free Market Shooter previously covered, Obama’s bullshit initially blamed insurers, not his healthcare monstrosity, for the cancellations:

    “One of the things health reform was designed to do was to help not only the uninsured but also the underinsured. And there are a number of Americans, fewer than 5 percent of Americans, who’ve got cut-rate plans that don’t offer real financial protection in the event of a serious illness or an accident.

     

    Remember, before the Affordable Care Act, these bad apple insurers had free rein every single year to limit the care that you received or used minor pre-existing conditions to jack up your premiums or bill you into bankruptcy. So a lot of people thought they were buying coverage, and it turned out not to be so good.”

    As one of the lucky ones who managed to purchase coverage after the law was signed but before the exchanges took effect, I can unequivocally state that my policy would be at least double were I to repurchase similar coverage in the exchange today… and could be as high as triple.  How many of those cancelled policies faced monster health insurance hikes?  Was Obama’s greatest bullshit claim, the blame that he assigned to “bad apple” insurers before he was forced to backtrack?

    How about another Obama quote, regarding “scandal” in his administration?

    “We have not had a major scandal in my administration.”

    As The Blaze pointed out, Obama’s administration could be just as easily defined by the word “scandal” as it is by the word “bullshit”:

    Obama sidestepped the comprehensive list of scandals that plagued his tenure as president. These scandals include but are not limited to: the Operation Fast and Furious gun walking scandal, the IRS scandal involving IRS workers intentionally targeting Tea Party organizations, and his own Secretary of State Hillary Clinton using a private email server.

    The Blaze also pointed out another fiction of Obama’s, which again reference the same Washington Post that goes out of its way to defend him:

    “The day after Benghazi happened, I acknowledged that this was an act of terrorism”

     

    Obama did refer to an “act of terror” in the immediate aftermath of the 2012 Benghazi attacks, but in vague terms, wrapped in a patriotic fervor. He never affirmatively stated that the American ambassador died because of an “act of terror.” Then, over a period of two weeks, given three opportunities in interviews to affirmatively agree that the Benghazi attack was a terrorist attack, the president obfuscated or ducked the question. So this was a case of taking revisionist history too far for political reasons.

    When it comes to Obama’s Presidency, and the comparison to bullshit, nobody summed it up better than Constitution.com:

    The two constants of the Obama era has been the president’s willingness to lie to the American people, and the media’s willingness to allow the president’s lies to slide by uncondemned. The Obama years have been nothing more than a series of thinly veiled (and sometimes blatantly naked) lies, uttered to placate the citizens of the United States while the federal government ballooned beyond meaningful control. Barack Obama’s legacy is one of unadulterated hubris, his efforts all focused on rending power from the people and handing it to bureaucrats, and America is fortunate to have survived this historically catastrophic presidency.

    Just take Obama’s (and PEOPLE Magazine’s) word for it though:

    “He’s nothing but a bullsh–ter.”

    But first ask yourself; is Obama referring to Trump, or just describing himself?

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  • Trump Inks Largest Arms Deal in U.S. History with Country He Said Funded ISIS

    There was a lot of pomp and circumstance upon Trump’s arrival in Saudi Arabia. It’s important to note, after 8 years of Iranian friendly Obama, the Saudis have strong motives to curry the favor of the new American President.

    The visit to Saudi Arabia is historic. It marks the first time in American history a President had chosen to make Saudi Arabia his first international visit. Upon landing in the oil rich gulf state, the President signed a massive arms deal — which could swell to more than $350b over the next decade. The deal includes blackhawk helicopters, a modified version of the Freedom-variant Littoral Combat Ship, thousands of precision guided weaponry, cargo helicopters, transport helicopters, 115 M1A2s tanks, anti-ballistic missile systems (THAAD), and ‘maritime assets.’

    The theory behind arming Saudi Arabia is that it would permit them to handle Iran in the Persian Gulf, granting us license to throw a few logs on the fire and doze off a bit while they do all the work for a change. All that sounds well and good, especially since the money will be spent with our weapons manufacturers, who employ thousands of Americans. But what about all of the stuff Trump said about Saudi Arabia during the campaign? Does that count for anything, or was it just election time shit talking?

    Here’s Trump chastising Clinton for accepting Saudi money, a country that ‘kills women’ and ‘treat women horribly.’

    Or what about the time Trump told The Morning Shill that Saudi Arabia was arming ISIS?

    This is the “if, then” logic I want to put on the table for you to think about. If Saudi Arabia funds radical Islam and ISIS, like Trump said, then should we be selling them advanced weaponry?

    One minor detail that is vexing me today. All of the conservatards are out in force, praising Melania Trump for not wearing a headscarf, which she’s 100% right for doing.

    But Michelle Obama didn’t wear one either. I don’t know why people are saying she did wear one.

    As a matter of fact, President Trump actually had the stones to criticize Michelle for doing so back then, calling it an insult.

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    If we’re gonna talk about this ‘historic trip’, let’s be honest about it then.
    Content originally published at iBankCoin.com

     

  • 10 Crazy Conspiracy Theories That Became Conspiracy Facts

    Authored by Jake Anderson via TheAntiMedia.org,

    Generally speaking, conspiracy theories form where there is a vacuum of verifiable facts associated with a controversial, usually tragic event. The concept has evolved over the years and is a part of our popular culture. There are legions of conspiracy theorists and “truthers” who have devoted their lives to certain theories, and there are legions of skeptics who have devoted their lives to debunking those theories. All the while, conspiracy theories of every stripe and variety festoon the footnotes of history. Even the origin of the phrase itself is subject to conspiracy theory, as some researchers have argued that the CIA invented and promulgated the term in order to marginalize fringe thinkers and neutralize investigations.

    The internet has obviously had a profound effect on conspiracy theories, simultaneously helping and hurting the cause. While a world of information is at people’s fingertips, so too are alternate worlds of manufactured propaganda. While the Internet may appear to be a democratized, unfiltered path toward facts and truth, it is easily manipulated. Powerful corporations pay a lot of money to have their dirty laundry buried in the search results underneath contrived puff pieces.

    With nearly the entire mainstream media apparatus at their disposal, the government is a maestro at this practice. As we learned from so-called Operation Mockingbird — a conspiracy theory fact discussed in my first post on the subject, “Conspiracy Theories That Turned Out to Be True,” — hundreds, if not thousands of news organizations have been conscripted into working with the CIA to support pro-government narratives. That was in the 1960s. One can only imagine how vast the network is now. Not to mention the fact that a single proprietary algorithm owned by Google dictates the vast majority of the population’s exposure to a subject.

    In Part 1, I noted that the list had been meticulously whittled down to focus only on conspiracies that have been irrefutably proven to be fact. There are hundreds of conspiracy theories I think are likely to be true that are not on this list because there simply isn’t enough hard evidence yet to confirm it 100%. I also aimed for a good mixture of old conspiracies and new conspiracies. With groups like Wikileaks and Anonymous out there, the last decade has witnessed a dam burst of new data and documents. Thanks to intrepid journalists, whistleblowers, hacktivists, and leakers, the human race continues to tear down the wall of lies erected by the corporatocracy.

    Without further ado, let’s get to it….ten more conspiracy theories we can start calling conspiracy facts.

    1. Operation Ajax, the CIA’s Iranian Coup

    In Iran it was called 28 Mordad coup; the United Kingdom contributed under the name Operation Boot. However you refer to it, Operation Ajax was an Iranian coup that in 1953 deposed the democratically elected Muhammad Mossadeq and reinstalled the monarchical power of Shah Mohammed Reza Pahlavi. The primary cause of the coup was Mossadeq’s attempt to nationalize the Iran’s oil fields, which threatened the oil profits of Britain’s Anglo-Persian Oil Company (AIOC). The U.S. — in addition to protecting its ally’s petroleum monopoly — viewed Mossadeq’s move as communist aggression and therefore helped plan the return to power of one the world’s more insidious dictators, the shah. Operation Ajax resulted almost directly in 1979 Iranian revolution that created an anti-West Islamic republic led by the Ayatollah Khomeini.

    Though it was long considered an open secret, the U.S. government kept the truth behind Operation Ajax concealed from the American people until very recently. The CIA declassified various documents on the 60th anniversary of the coup.

    Because of the recent declassification, much information relevant to this CIA-sponsored coup is now available in the CIA’s archives.

    In describing Operation Ajax, the CIA itself has become rather oddly self-reflective:

    “The world has paid a heavy price for the lack of democracy in most of the Middle East. Operation Ajax taught tyrants and aspiring tyrants that the world’s most powerful governments were willing to tolerate limitless oppression as long as oppressive regimes were friendly to the West and to Western oil companies. That helped tilt the political balance in a vast region away from freedom and toward dictatorship.”

    In a recent interview on Democracy Now, Bernie Sanders remarked to Amy Goodman that this seminal chapter in the history of U.S./Middle East relations is almost entirely ignored by mainstream media. “Have you seen many shows about that on NBC?” he asked the crowd.

    2. “Nayirah,” the False Pretext for the first Gulf War

    It’s now commonly believed that the second Iraq War was sold to the American people — and their congressional representatives — based on an elaborate web of lies and manipulated intelligence. What is less commonly known is that the first Iraq War came about in a very similar fashion. While, surprisingly, there is broad agreement that “Operation Desert Storm” was a worthwhile war, many people overlook the role of a fifteen-year-old girl named “Nayirah,” whose 1990 testimony to the Congressional Human Rights Caucus is credited with cementing the idea of Iraqi war crimes in the American popular consciousness. Nayirah testified to having witnessed Iraqi troops tearing babies from their incubators in Kuwaiti hospitals and leaving them to die on the floor. It’s a profoundly disturbing image….and one that was entirely fictitious.

    After a lengthy investigation, Amnesty International and other independent watchdog groups discovered that the situation described by Nayirah was fabricated by a PR firm named Hill & Knowlton (the largest in the world at this time), which was hired by the group Citizens for a Free Kuwait in order to create propaganda that would galvanize pro-war sentiment. The man overseeing the campaign was Bush political confidante Craig Fuller. This was a massive project utilizing 119 H&K executives in 12 offices across the United States and even involved casting Nayirah, who turned out to be Nayirah al-Sabah, daughter of Saud bin Nasir Al-Sabah, Kuwaiti ambassador to the United States. The Justice Department, which could have investigated the entire effort under the Foreign Agents Registration Act, turned a blind eye, allowing the Bush administration to pull off a massive “Wag the Dog”-style ideological false flag. Others call it “atrocity propaganda,” a form of psyop (psychological operation).

    The “Nayirah” story is just another example of the government falsifying a narrative in order to manipulate the public into supporting war. This kind of psychological propaganda continued all through the second Iraq War and the War on Terror. Just recently, it was revealed that the Pentagon paid PR firm Bell Pottinger $540 million to create fake terrorist videos in Iraq.

    3. Operation Paperclip

    Originally called Operation Overcast, Operation Paperclip was the codename of the secret American plan to conscript Nazi scientists into U.S. intelligence services at the end of World War II. This ushered in and shielded about 1,500 Germans, including some engineers and technicians. Ostensibly, the purpose of this redeployment by the Joint Intelligence Objectives Agency (JIOA) was to prevent Nazi scientific intelligence from helping reconstitute a new German government; it was also a tactic meant to ensure the Soviet Union didn’t acquire any new technology.

    Whatever strategic mindset might have lived inside Operation Paperclip, at its core, the project gave American identities to some of the most ruthless war criminals the world has ever seen.

    According to Ynet, the new Nazi CIA scientists helped develop chemical weapons for the U.S. and worked alongside American scientists to develop LSD, which the CIA viewed as a ‘truth serum.’

    4. Operation Gladio: Anti-Communist False Flags in Italy

    Operation Gladio was the post-World War II love-child of a CIA/NATO/M16 plot to battle communism in Italy. The operation lasted two decades and used CIA-created “stay behind” networks as part of a “Strategy of Tension” that coordinated multiple terrorist attacks from the late 1960s to the early 1980s. Authorities blamed these attacks on Marxists and other left-wing political opponents in order to stigmatize and condemn communism. The operation involved multiple bombings that killed hundreds of innocent people, including children. The most notable attack was the August 2, 1980, bombing of the Bologna train station, which killed 85 people.

    In an Anti-Media piece written about five confirmed false flag operations (which includes Operation Gladio, I wrote:

    How do we know about Operation Gladio in spite of its incredibly clandestine nature? There are two principle sources. One, the investigations of Italian judge Felice Casson, whose presentation was so compelling it forced Italian Prime Minister Giulio Andreotti to confirm Gladio’s existence. The second source is testimony from an actual Gladio operative, Vincenzo Vinciguerra, who is serving a life sentence for murder. In a 1990 interview with the Guardian, Vincenzo stated that Gladio was designed to psychologically coerce the Italian public to rely on the state for security.”

    Operation Gladio is a textbook modern “false flag.” It used terror and violence to discredit an ideology (communism). And to think, this came at a time before the internet when the CIA didn’t have a fully entrenched mainstream media to trumpet, echo, and build consensus around every little nuance (though they were working on it with COINTELPRO and Operation Mockingbird). Nowadays, the CIA has multinational propaganda machines — the news networks — to make sure all terrorist attacks fit into the carefully scripted narrative that manufactures consent around our wars for oil, natural gas, and other resources.

    5. Government uses insect and rodent drones to spy

    It’s somewhat of a cliche to jokingly refer to a surrounding insect or bird as a clandestine spy deployed by the government to watch you. While we lack certain specifics on the ubiquity of the technology, we know definitively that the government has the technology to surveil citizens using insects and other small animals, and they use this technology in military applications.

    There is some evidence to suggest that insect drones are used domestically to spy on citizens. In 2007, this theory conspiracy theory took shape when anti-war protesters reported strange buzzing insects. Written off as tin foil material, officials dismissed the suggestion that the government used insect drones to spy. Multiple witnesses reported erratic dragonfly-type objects hovering in the sky. The very next year, the U.S. Air Force announced their intended use of insect-sized spies ‘as tiny as bumblebees’ to infiltrate buildings in order to ‘photograph, record, and even attack insurgents and terrorists.‘ The government has come clean about its use of drones to spy on American citizens, so it’s difficult to believe they wouldn’t have at least tried insect drones.

    While we can’t say with 100% certainty that there are insect drones spying on American citizens, though it’s exceedingly likely, what is irrefutable is the use of micro air vehicles (MAVs) and “spy animals” as war-time tools. DARPA launched its Stealthy Insect Sensor Project in 1999 as an effort to deputize bees as bomb locators in war zones. This was just the first phase in an ongoing project. In her book The Pentagon’s Brain: An Uncensored History of DARPA, America’s Top Secret Military Research Agency, journalist Annie Jacobsen revealed that the agency’s near-future trajectory is to introduce “biohybrids” — part animal, part machine cyborgs — into the United States’ military arsenal.

    In an interview with Coast to Coast AM, Jacobsen said:

    DARPA has already succeeded in creating a rat that will be steered by remote control by implanting an electrode in its brain.

    “And it’s done the same thing with a moth which is really remarkable because the scientists implanted the electrodes in the pupa stage of the moth when it was still a worm! And then it transformed into having wings, and those tiny little micro-sensors transformed with the moth and the DARPA scientists were able to steer that moth.”

    This section references information from The Pentagon’s Brain: An Uncensored History of DARPA, America’s Top Secret Military Research Agency by Annie Jacobsen. Details not linked to external sources are cited in this book.

    6. CIA assassinations and coups in foreign countries

    When operatives for the Democratic Party claim the 2016 United States presidential election was tampered with by a foreign entity, it’s hard not to cringe at the irony. Firstly, they’ve presented no evidence, except to claim that government intelligence agencies believe it to be true. Sorry, that’s not actually evidence. That’s like the police saying they have DNA evidence but never actually scientifically presenting it in court. It’s kind of unnerving that we even have to point that out. Secondly, our own government and intelligence agencies, namely the CIA, have actively and aggressively subverted countless foreign elections over the last century and, in some cases, have outright funded the assassinations of candidates.

    This subject could easily fill a multi-volume book, and countless authors have worked over the years to uncover the role of the CIA in foreign coups. Using every tool in their arsenal — including white, grey, and black psychological operations, counterinsurgencies, and brutal coups aimed at repressing and destroying radically democratic candidates — the CIA has subverted the “will of the people” across the world.

    The most commonly noted instances of the CIA meddling in foreign elections and governments include the following: South Korea (late-1940s); Italy (1948-mid-1970s); Guatemala (1954); Congo (1960), Dominican Republic (1961), South Vietnam (1963), Brazil (1964); Uruguay (1969); Bolivia (1971); Chile (1970-1973); Argentina (1976); Australia (1975); El Salvador (1980); Iran (late-1970s); Grenada (1983) Haiti (1986); Panama (1990) Nicaragua (1990); Czechoslovakia (1990); Peru (1990-2000) Yugoslavia (2000). This is but a small sampling of countries where even mainstream news outlets and, in many cases, the CIA itself, admits calamitous U.S. involvement. There are literally dozens more and, of course, this is restricting the conversation to soft coups — otherwise, we could certainly include the complete military decimation of Iraq, Afghanistan, Libya, and other Middle Eastern countries during the War on Terror, as well as the myriad imperial wars against perceived communist threats.

    ‘A foreign government hacked and subverted our election!’

    The irony is thick with this one. Payback’s a bitch…..which, of course, isn’t giving our intelligence agencies, who have proven themselves to be pathological liars, the benefit of the doubt regarding their claims of Russian collusion during the 2016 presidential election. It’s just to kind of say…..you reap the harvest you have sown. When you look at the track record of the United States government, it’s a wonder the average citizen is safe traveling abroad.

    7. Mainstream media is the propaganda branch of the State Department

    People have long accused the media of being a proxy branch of the State Department, a highly sophisticated and well-produced form of manufactured consensus and controlled opposition all rolled into one. In ostensibly democratic nations, a free and independent press is of paramount importance. But in the U.S., we find a cohesion of the state and corporate news networks that do not constitute ‘state-run media’ in the traditional sense — but it’s close.

    Our first solid documentation that the media is an echo chamber for the government came with the disclosure of what has come to be called Operation Mockingbird. This nefarious and far-reaching conspiracy was documented in Part 1 and involved the CIA essentially conscripting journalists, American news agencies, and major broadcasters to become domestic propagandists and spies. Eventually, this CIA/media symbiosis included journalists from all the top news organizations. Literally, thousands of people were involved.

    This infiltration of the American media and press took place during the 1950s, at the start of the Cold War, and was carried out under the auspices of fighting communism. The CIA began to restrict its use of journalists in the Operation Mockingbird program in 1976, but many people believe it has since transmogrified into something far more powerful, nefarious, and ubiquitous today. We’re still in the early stages of proving to the masses that mainstream media is little more than a mouthpiece and propaganda machine for the government and its various agencies, but the evidence is accumulating.

    During the 2016 presidential election, Wikileaks exposed a number of disturbing revelations showing collusion between the media and political operatives. This included collusion between the media, the Democratic National Committee, and the Hillary Clinton campaign. But it wasn’t just about swaying the election. New revelations showed that the government actively infiltrates powerful media corporations in order to shape their content and narratives. One of the best examples of this was the State Department’s role in affecting a CBS 60 Minutes interview with Julian Assange.

    A more comprehensive list of examples of the Orwellian symbiotic relationship between the press and the government can be found here.

    Perhaps the most disturbing recent addition to this chapter was the “Countering Disinformation Act” that President Obama slipped into the National Defense Authorization Act (NDAA) on Christmas Eve of last year. In the context of the still-festering narrative of foreign interference in the 2016 presidential election, the act’s putative goal was to fight “fake news,” which many believe is actually a campaign to silence and dismantle alternative media on the Internet.

    In order to accomplish this, the government is establishing a Global Engagement Center for managing disinformation and propaganda. Since we already know our government routinely performs psychological operations (psyops, or as they’ve been recently rebranded, Military Information Support Operations [MISO]), it should come as no surprise that manipulating the civilian population is a permanent goal. In fact, in the 2013 National Defense Authorization Act, the government formally legalized the use of psyops on U.S. citizens. So how does this Global Engagement Center factor in?

    The new law states:

    “The Center is authorized to provide grants or contracts of financial support to civil society groups, media content providers, nongovernmental organizations, federally funded research and development centers, private companies, or academic institutions for the following purposes:

    • To support local independent media who are best placed to refute foreign disinformation and manipulation in their own communities.
    • To collect and store examples in print, online, and social media, disinformation, misinformation, and propaganda directed at the United States and its allies and partners.
    • To analyze and report on tactics, techniques, and procedures of foreign information warfare with respect to disinformation, misinformation, and propaganda.
    • To support efforts by the Center to counter efforts by foreign entities to use disinformation, misinformation, and propaganda to influence the policies and social and political stability of the United States and United States allies and partner nations.”

    While it may not immediately strike one as sinister, this codification of repressing journalists and voices the government deems to be disinformation while creating an even more centralized infrastructure to control “fact-based narratives” in the media should be highly alarming to anyone who cares about a free press. It would seem that while the State already has a steel grip on corporate news networks, they are struggling to control the influence of online independent media. This new law may be the start of this century’s Operation Mockingbird — a new full-scale infiltration of the local news and a war against anti-establishment narratives on the Internet. This is already taking the form of algorithmic censorship through Facebook and Google, as well as a weaponization of the “fake news” narrative.

    8. The Deep State (or the conspiracy theory formerly known as The New World Order)

    I describe the Deep State in depth in an article entitled “Forget the New World Order — Here’s Who Really Runs the World.” In it I wrote:

    “For decades, extreme ideologies on both the left and the right have clashed over the conspiratorial concept of a shadowy secret government often called the New World Order pulling the strings on the world’s heads of state and captains of industry.

    “The phrase New World Order is largely derided as a sophomoric conspiracy theory entertained by minds that lack the sophistication necessary to understand the nuances of geopolitics. But it turns out the core idea — one of deep and overarching collusion between Wall Street and government with a globalist agenda — is operational in what a number of insiders call the “Deep State.”

    In the wake of the 2016 election, the concept of the Deep State has grown into somewhat of a common phrase in the lexicon of alternative media theorists, crossing political boundaries and resonating across the ideological spectrum. Everyone from alt-left socialists to alt-righters now agrees there is an unelected cabal of elite neo-conservative corporatists and crony lawmakers running the geopolitical show.

    Because it’s such a complex subject and permeates so many different academic, economic, and state apparatuses, it’s virtually impossible to issue a single, simple definition of the Deep State. If I were to hazard one, I would call it “the nexus of Wall Street and the national security state — a relationship where elected and unelected figures join forces to consolidate power and serve vested interests.” But even that is vague. We could also call it “the failure of our visible constitutional government and the cross-fertilization of corporatism with the globalist war on terror.”

    Former Republican congressional aide Mike Lofgren gets more specific with who is involved:

    “It is a hybrid of national security and law enforcement agencies: the Department of Defense, the Department of State, the Department of Homeland Security, the Central Intelligence Agency and the Justice Department. I also include the Department of the Treasury because of its jurisdiction over financial flows, its enforcement of international sanctions and its organic symbiosis with Wall Street.”

    In his writing, Lofgren emphasized the role of FISA international surveillance courts. This was confirmed in a very interesting way when President Donald Trump accused former President Obama of tapping his phones, a charge Obama aides deflected by saying that if such a warrant had been issued, it would have been done through a FISA court. This shows how presidents are able to skirt the constitution by outsourcing surveillance requests. It also shows the interconnectedness of these agencies.

    However you want to describe it, it’s the natural conclusion of Operation Mockingbird and most certainly a reality that the elites would have rather kept under the radar. Fortunately for the people of the Earth, revelations from Wikileaks and other whistleblowers have, over the last couple decades, made it abundantly clear that the Deep State (the New World Order) not only exists, but also that it’s far more sinister and powerful than early conspiracy theorists could have ever imagined.

    9. CIA used psychics to infiltrate the Soviet Union during Cold War

    It’s a plot in a science fiction movie or TV show we’ve all seen: a psychic being leveraged by a law enforcement agency to track down a criminal. The concept of a government psychic program was popularized by the film The Men Who Stare at Goats, which lampooned the mythical STARGATE program supposedly run by the CIA. Most people scoffed at the reality of this and considered it a wacky conspiracy theory, but a recently declassified trove of hundreds of thousands of CIA files finally confirmed not only that psychics are regularly used by police and other law enforcement agencies, but also that the government actually weaponized psychics during the Cold War to try to infiltrate the Soviet Union and gain information.

    The documents, made publicly available thanks to the activist group Muckrock, confirm there were top-secret CIA and Defense Department programs to use remote viewing to infiltrate Soviet military installments. There were also programs developing ways to engage in “psychic warfare,” including the development of a “psychic shield” to block Soviet psychics.

    10. CIA monitors U.S. citizens via their smart devices

    Early in 2017, the organization Wikileaks began releasing their first post-2016 election cables with a series of explosive data dumps regarding the CIA’s cyber hacking abilities and exploits. It is called Vault 7. Updated serially in “Year Zero,” “Dark Matter,” “Marble,” “Grasshopper,” “HIVE,” “Weeping Angel,” and “Scribbles,” the documents show the unprecedented collection of cyber vulnerabilities, exploits, and hacking abilities consolidated within the agency that many believe constitute wide-ranging breaches of civil liberties.

    Chief among these breaches is domestic surveillance and extrajudicial cyberhacking, which the Wikileaks documents confirm are taking place in an abundance of forms. The Vault 7 documents confirm that: The CIA can break into Android and iPhone handsets and all kinds of computers; the agency has the ability to hack into Apple iPhones and Android smartphones and actually assume full remote control of the device; the CIA can access consumer smart TVs to listen in on surrounding conversations; the agency looked into ways to hack into cars and crash them, allowing ‘nearly undetectable assassinations’ (an assertion that may be relevant to the Michael Hastings case); the CIA concealed vulnerabilities that could be exploited by hackers from other countries or governments.

    This is just the beginning. Early in the release, Julian Assange said the documents released represented only a tiny fraction of the total data that was forthcoming. Wikileaks’ episodic data dumps on the CIA’s cyber hacking programs are nothing less than stunning. The establishment’s reaction to the ongoing releases verifies how big of a deal they are. One congressman went so far as to refer to Julian Assange and his whistleblowing outfit as a “foreign terrorist organization.” This isn’t new or unexpected, as the group’s slow but inexorable drips of revelations about government malfeasance continue to confound and disturb private citizens, consumer rights activists, tech companies, and international leaders alike.

    Conclusion

    Of course, not all conspiracy theories are true. In fact, there are hundreds, even thousands, that have been roundly debunked. Unfortunately, there are those who seek to lie and invent fictions for monetary gain and fame. Disinformation, propaganda, and dishonesty exist at all levels of society.

    However, sometimes conspiracy theories turn out to be true. Therefore, it’s worth assessing them, even if their claims appear wholly outlandish. Especially if their claims appear wholly outlandish.

    The conspiracy theory is a tool in a larger tool kit used by those who wish to decode the grossly imperfect and fluid narrative describing our world. When investigated responsibly, conspiracy theories function as part of a conceptual spectrum of analysis with which we can investigate government and corporate abuses of power and the manufacturing of ‘consensus reality.’ In the 21st century, when the very transmission of information can be considered criminal, being a responsible conspiracy theorist just means you practice due diligence and hunger for the truth.

  • The Arctic Doomsday Seed Vault To Save The World… Has Flooded Thanks To Global Warming

    Having first been used in 2015 to save Syrian biodiversity, the Arctic stronghold for the world’s seeds – designed to rescue humanity in case of doomsday – has flooded after permafrost melts due to global warming. While no seeds were lost, The Guardian writes that the ability of the rock vault to provide failsafe protection against all disasters is now threatened by climate change.

    As a reminder, on a remote island that is just 800 miles (1,300 km) from the North Pole, the Norwegian government has built a failsafe in the freezing cold that protects thousands of the most vital crops from extinction.

    Officially called the Svalbard Global Seed Vault, it already holds close to a million samples of crops around the world, with each sample holding about 500 seeds. The following infographic, from Futurism, has more on this Doomsday Vault that could one day help to save civilization:

    Courtesy of: Visual Capitalist

    However, as The Guardian reports, while it was designed as an impregnable deep-freeze to protect the world’s most precious seeds from any global disaster and ensure humanity’s food supply forever, the Global Seed Vault has been breached after global warming produced extraordinary temperatures over the winter, sending meltwater gushing into the entrance tunnel.

    When it was opened in 2008, the deep permafrost through which the vault was sunk was expected to provide “failsafe” protection against “the challenge of natural or man-made disasters”.

    But soaring temperatures in the Arctic at the end of the world’s hottest ever recorded year led to melting and heavy rain, when light snow should have been falling. “It was not in our plans to think that the permafrost would not be there and that it would experience extreme weather like that,” said Hege Njaa Aschim, from the Norwegian government, which owns the vault.

    “A lot of water went into the start of the tunnel and then it froze to ice, so it was like a glacier when you went in,” she told the Guardian. Fortunately, the meltwater did not reach the vault itself, the ice has been hacked out, and the precious seeds remain safe for now at the required storage temperature of -18C.

    But the breach has questioned the ability of the vault to survive as a lifeline for humanity if catastrophe strikes. “It was supposed to [operate] without the help of humans, but now we are watching the seed vault 24 hours a day,” Aschim said. “We must see what we can do to minimise all the risks and make sure the seed bank can take care of itself.”The vault’s managers are now waiting to see if the extreme heat of this winter was a one-off or will be repeated or even exceeded as climate change heats the planet. The end of 2016 saw average temperatures over 7C above normal on Spitsbergen, pushing the permafrost above melting point.

    “The question is whether this is just happening now, or will it escalate?” said Aschim. The Svalbard archipelago, of which Spitsbergen is part, has warmed rapidly in recent decades, according to Ketil Isaksen, from Norway’s Meteorological Institute.

    Aschim said there was no option but to find solutions to ensure the enduring safety of the vault: “We have to find solutions. It is a big responsibility and we take it very seriously. We are doing this for the world.”

    “This is supposed to last for eternity,” said Åsmund Asdal at the Nordic Genetic Resource Centre, which operates the seed vault.

     

  • Kim Dotcom Goes All In: 'I Knew Seth Rich… I Was Involved'

    Kim Dotcom; hacker, serial entrepreneur – and for a while the #1 ranked Call of Duty: Modern Warfare 3 player in the world – may be the key to the entire Seth Rich saga. From testimony in the Wikileaks investigation to Rich’s still unsolved murder – and facing extradition – Dotcom is ready to go nuclear…

    To bring you up to speed

    Last week, Private Investigator Rich Wheeler appeared on Fox5 news in DC with an update in the unsolved murder of DNC IT expert Seth Rich, claiming proof exists on Rich’s laptop proving he was Julian Assange’s source for leaked DNC emails during the 2016 election – an account in direct conflict to the Russian hacking narrative based on a discredited IT firm’s report.

    Wheeler walked back his statements the next day, however the fuse was already lit… Weaponized autists on Reddit and 4chan began furiously digging back into the Seth Rich case for clues in the still unsolved murder – and they went deep.

    Among the findings were Seth Rich’s Reddit account, email addresses, and Twitter accounts – one of which was in support of candidate Bernie Sanders. As an aside – before joining the DNC, Rich moved to Washington DC to take a job with polling and research firm Greenberg Quinlan Rosner – whose founder Stanley Greenberg was a senior advisor to President Bill Clinton.

    Reddit’s the_donald goes dark

    As Seth Rich posts reached a crescendo Friday night – dominating the front page of /r/The_Donald, the Conde Nast-linked website shut the ‘subreddit’ down for around 12 hours following a moderator’s unrelated declaration of war on the rest of Reddit over censorship – completely killing the Seth Rich momentum. When The_Donald was reopened, ‘officially’ to aid the Seth Rich effort – the offending moderator had been banned and two other mods were removed from their positions. Seth Rich posts, however, are notably sparse. Oh, and Reddit edited Seth Rich’s account during the lockout.

    Meanwhile in New Zealand

    Kim Dotcom is pissed – and has been plotting revenge against Hillary Clinton, Obama, and Hollywood after being targeted in the biggest copyright infringement case in history – which included a massive illegal (and then legal) raid on his New Zealand mansion by 76 armed officers and two helicopters.

    Also seized were giant screen TVs and works of art, US$175m (NZ$218m) in cash, the contents of 64 bank accounts world-wide, including BNZ and Kiwibank accounts in New Zealand, Government bonds and money from numerous PayPal accounts.

    Police said last night up to $11m in cash was restrained in various accounts. stuff.co.nz

    Dotcom was arrested and thrown in prison for almost two months, and has been fighting ongoing court battles and pressure to extradite him to the USA ever since. In December of 2016, New Zealand’s district court announced Mr. Dotcom was eligible for extradition – a decision upheld on appeal by NZ’s High Court.

    The Mega founder has stepped forward to offer proof that Seth Rich was one of Wikileaks’ sources during the 2016 presidential election.

    //platform.twitter.com/widgets.js

    //platform.twitter.com/widgets.js

    Sean Hannity has offered Dotcom a national platform (which Kim retweeted)

    //platform.twitter.com/widgets.js

    Dotcom’s offer to Congress

    //platform.twitter.com/widgets.js

    And he’s crystal clear on why he’s doing this

    //platform.twitter.com/widgets.js

    Turning back the clock – hinting at hacks

    In December of 2014, Dotcom kicked off a series of tweets foreshadowing events to come – beginning with the claim that he was going to be “Hillary’s worst nightmare in 2016.” In a subsequent Bloomberg article from May of 2015 which used Kim’s threat in the headline, Dotcom revealed that Julian Assange was about to unleash hell on Hillary Clinton – with Dotcom clearly involved;

    “I have to say it’s probably more Julian,” who threatens Hillary, Dotcom said. “But I’m aware of some of the things that are going to be roadblocks for her.”.

    Assange has access to information, Dotcom said –Bloomberg, May 2015



    Now take a look at a few of Dotcom’s tweets from December 2014 on…

    //platform.twitter.com/widgets.js

    (p.s. for all the anons looking for digits, the above tweet’s ID is: 539567677732171777)

    Kim was confident Hillary was going to lose back in May of 2015

    (dubs in twitter ID)

    Around two months later, Kim asks a provocative question

    //platform.twitter.com/widgets.js

    Dotcom responds to an article from July of 2016 about classified info found on her server – directly hinting at upcoming leaks.

    First, let’s review part of the timeline:

    July 4th, 2016: Wikileaks tweets a link to a bunch of Hillary emails obtained legally under the Freedom of Information Act (FOIA).

    July 22nd, Wikileaks releases around 20,000 emails related to the DNC.

    October 7th, The Podesta emails begin to leak, which included emails to and from Hillary Clinton and associates.

    October 17th, Wikileaks announced a ‘state party’ had severed Julian Assange’s internet connection at the Ecuadorian embassy.

    The day after Wikileaks released the 20,000 DNC emails, Dotcom referred it as “Episode 1”

    //platform.twitter.com/widgets.js

    Kim goes into his beef with Hillary…

    //platform.twitter.com/widgets.js

    Kim reaches out to Google employees

    In light of this week’s Reddit / 4chan investigation turning up Rich’s email addresses (which Reddit scrubbed during the blackout), Dotcom is urging Google employees to submit Rich’s email contents to Wikileaks.

    //platform.twitter.com/widgets.js

    Questions remain

    Why did Seth Rich do it?

    11 days after Seth Rich’s death, his girlfriend made a Facebook post in which she said Seth found out that Hillary Clinton was rigging the election through fake polling stations whereby Bernie Sanders ballots were shredded and replaced with Hillary ballots.

    Others think Rich became enraged after learning how Hillary and the DNC stole the election from Bernie Sanders – who Rich supported. Furthermore, Rich worked closely with to the players involved in a suspected setup to make it appear that Bernie Sanders had ‘hacked’ Hillary Clinton.

    How long was Rich working against Hillary Clinton?

    Kim Dotcom began alluding to Hillary’s downfall in December of 2014, six months after Seth Rich joined the DNC. Was Rich feeding Wikileaks information since then – or did Julian Assange have other sources? What made Kim Dotcom so confident? Recall that prior to working for the DNC, Seth Rich worked for Bill Clinton advisor Stanley Greenberg’s polling firm Greenberg Quinlan Rosner. Is it possible Rich discovered things about the Clintons and/or Clinton Foundation which turned him off?

    Seth Rich only accounts for the DNC emails, not John Podesta’s

    Ex-Kissinger official and CIA operator Dr. Steve Pieczenik went on record in November of 2016 to assert that rogue elements within US Intelligence agencies – not Russians – passed the information to Julian Assange.

    Now consider the official story that the Podesta emails were obtained via phishing email scam, in which John Podesta fell victim to a fake email claiming to be a Google password reset.

    Did that even happen? Or were Podesta’s emails in fact obtained by ‘rogue elements’ within US Intelligence who passed them to WikiLeaks in conjunction with Seth Rich’s email dump from the DNC?

    I am hopeful the truth will emerge in the fullness of time.

    Content originally generated at iBankCoin.com * Follow on Twitter @ZeroPointNow

  • Schlichter Warns "This Is A Coup Against Our Right To Govern Ourselves"

    Authored by Kurt Schlichter via Townhall.com,

    The blizzard of lies and distraction blowing through Washington is not just any routine stuffstorm, but a calculated attempt to bring down a president – our president, not the establishment’s president. And more than that, it’s an attempt to ensure that we never again have the ability to disrupt the bipartisan D.C. cabal’s permanent supremacy by inserting a chief executive who refuses to kiss their collective Reid.

    This is a coup against us. It’s a coordinated campaign by liberals and their allies in the bureaucracy and media to once and for all ensure their perpetual rule over us. We need to fight it, here and now, so we don’t have to fight it down at the bottom of this slippery slope.

    It’s brazen. It’s bold. It’s insulting to our intelligence. They aren’t even trying to hide their lies anymore. Truth is irrelevant; this is a choreographed dance routine and everyone has his moves. Call it Breakin’ 2: Electric Leakaroo, except instead of trying to save the community center they’re trying to save their power and prestige.

    To buy the media narrative on this latest Russian nonsense, you must believe:

    1. That whatever was revealed was super-secret, though we don’t know exactly what it was. When in doubt, assume it’s on par with the nuclear codes!

     

    2. That there was no good reason to share this info with Russia, like coordinating our fight against our joint enemy or to prevent another Russian airliner massacre. Because why would we want another power fighting ISIS or civilians not to be blown out of the sky?

     

    3. That LTG McMaster, who literally wrote the book on soldiers standing up to misbehaving civilian leaders and displayed immense personal courage in battle, turned chicken and sat there silently as Trump monologued about this unknown mystery info of doomsday-level import.

     

    4. That LTG McMaster lied on camera. Twice. And that Secretary of State Tillerson lied too.

     

    5. That random anonymous sources in an intelligence community that hates Trump with a burning passion must be believed without question, though we don’t know their identities or their motives.

     

    6. That these anonymous randos must be believed, even though they were not actually in the room to, you know, actually hear what happened. The traditional bar on hearsay is apparently now just a bourgeois conceit.

     

    7. That when the Washington Post and the rest of the media publishes classified stuff (including intelligence provided by allies) leaked by anyone not named “Donald Trump,” it’s awesome.

     

    8. That the Washington Post and the rest of the media, which has been wrong over and over again in their reporting, are not wrong again.

     

    9. That the Washington Post and the rest of the media are objective and have no anti-Trump bias, even though they are literally cheering the hits on the president.

     

    10. That there are unicorns.

    The latest pseudo-scandal is that Trump doesn’t think Mike Flynn did anything wrong, and told James Comey so back in February. So basically, Trump expressed the same view he had of the whole Flynn nonsense to Comey as he has expressed to every interviewer. Comey did nothing, and said nothing (even when testifying to Congress) for nearly three months, because it was nothing. The Russian snipe hunt continued throughout unabated. That off-hand comment was a pretty poor attempt at obstruction of justice since it didn’t obstruct anything – to the limited extent these Russian witch hunts can be confused with “justice” at all.

    So the Menschian thinkers who usually scream “Treason!” are now screaming “Obstruction of Justice!” It’s adorable when they learn new terms and try to use them correctly; they’re so proud of themselves and their vocabulary building that you almost feel bad having to point out that they sound like idiots.

    It is nice, though, to have liberals finally come out against the abuse of executive power, misuse of classified material, and Russians. Welcome to the party, except we know you’re full of Schumer.

    It’s all lies, and they know it and we know it. Normal people just shake their heads and wonder why Washington is so consumed with political nonsense instead of solving problems. But then, Washington does not produce solutions. It produces only political nonsense.

    This is a concentrated, coordinated effort by elite insiders to take down not this president – Trump’s not the point here – but to take down us, the normal American they seek to rule. Someone came to Washington who wasn’t part of the club, and that’s intolerable. So they are desperate to expel him, and by extension, us.

    Every day will be a crisis, every action he takes will be the worst thing that has ever happened, and every step towards keeping his promises a crime.

    Repeal Obamacare? TRUMP’S SENTENCING MILLIONS TO DEATH!

    Talk to Russians? IT’S TREASON!

    Telling Comey he wishes this nonsense would stop? OBSTRUTION OF JUSTICE EVEN THOUGH NOTHING WAS OBSTRUCTED!

    Now, this campaign isn’t aimed at us. Normal people, people who don’t live in DC or NYC or LA, just tune it out. After all these years, and with the help of the web, we normals know the game. We’re woke, as the dorky leftists say.

    The target of this constant barrage is the soft and the stupid, the smug and the sanctimonious, the wusses and the surrender flunkies. That’s why you get the girlish-handed likes of David Brooks writing dainty columns that give Trump such a pinch! That’s why David Frum starts using words like “courage” to impugn actual men who have done actual man-things, like LTG McMaster. That’s why Kasich spews his bilious funk of sanctimony and submission, among other funks. It’s all to appeal to the Fredocons, the soft-headed RINOs who are smart, not dumb like everyone says, who just want something for themselves – attention, approval, and media pats on their pointy little heads.

    So these fussy ninnies, fresh from having some v-capped crone screeching at them that they will vote to take away her right to have taxpayers fork cash over to kill the baby no man will ever give her, wander outside into a wall of mics and cameras and pause. Then they talk, and when what they say trashes Trump sufficiently, the smiles from the press come, and the nods, and then the faux respect. Now they are no longer mean old Rethuglicans but dauntless heroes, at least in Georgetown, because they are willing to dance and caper to the tune of the establishment.

    This tsunami of baloney isn’t aimed at us. It’s aimed at them, the Republicans who are foolish enough to believe their new friends when they whisper words like “honor” and “patriotism.” Some of the marks are real patriots who fall prey to these liars when they couch their bogus narrative in national defense terms. But the majority of the marks are just morons.

    When targeting the dummies, the goal is simple. Draw off enough weak, attention-addicted RINOs to make it impossible for the President to govern. Then, hopefully, us normals will shrug, and slink away, having relearned our place. After all, we’re deplorable.

    And when the liberal establishment retakes power, and the mavericks and goody-goodies get tossed aside, the bureaucracy, media and the Democrats will conspire to ensure that no one can ever take their power from them again. But they haven’t considered the consequences. We’ll object.

    So we have to fight against this cable network coup. Because, if we don’t fight now, we all may end up fighting later.

  • Is Trump About To Flip-Flop On "Radical Islamic Terrorism"?

    With the President's base already turning against him (after appearing to flip-flop on five core campaign promises), Trump may be able to do the biggest reversal yet as The Hill reports that White House national security adviser H.R. McMaster suggested that President Trump may abandon the phrase "radical Islamic terrorism" in a scheduled speech in Saudi Arabia on Sunday.

    As The Hill points out, Trump frequently used the phrase "radical Islamic terror" on the campaign trail to describe Islamist extremists and militant groups, but the term has historically been avoided by presidents, including George W. Bush and Barack Obama.  In fact, McMaster himself has urged the president to refrain from using the phrase, arguing that violent extremists, such as ISIS militants, push a perverse view of Islam and that the phrase "radical Islamic terror" ultimately hinders U.S. goals, according to CNN.

    McMaster said on ABC's "This Week"…

    "The president will call it whatever he wants to call it. But I think it's important that, whatever we call it, we recognize that [extremists] are not religious people. And, in fact, these enemies of all civilizations, what they want to do is to cloak their criminal behavior under this false idea of some kind of religious war."

     

    "But I think what the president will point out is the vast majority  – the vast majority of victims from these people are Muslims. And of course the Muslim world is very cognizant of that, having born witness to and experienced directly this humanitarian catastrophe that's going on across the greater Middle East and beyond."

     

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    In his speech on Sunday, Trump is expected to cast the fight against extremism as a "battle between good and evil," rather than a religious war, while calling for unity with allies in the Islamic world.

  • "An Empty Lot, An Idle Backhoe And Pieces of Rubble": NYC Real-Estate Market Is Imploding

    The stringent capital controls adopted by Chinese authorities on Jan. 1, some of which were specifically designed to curb foreign real-estate purchases, appear to have had their desired effect. To wit: First-quarter property sales plummeted 58% to $4.3 billion, compared with a year earlier, Bloomberg reported, citing data from real-estate brokerage Cushman & Wakefield Inc.

    And nationwide, the picture wasn’t much better: Sales dropped 18 percent, research firm Real Capital Analytics Inc. found.

    Here's a rundown of the new capital controls, as reported by Bloomberg:

    • Customers must pledge money won’t be used for overseas purchases of property, securities, life insurance or investment-type insurance. While such rules aren’t new, citizens previously didn’t have to sign such a pledge
    • Customers must give a more detailed account of the planned use of funds, such as business travel, overseas study, family visits, medical treatment, merchandise trade or purchases of non-investment insurance policies, including the timing, by year and month
    • Violators of foreign-exchange rules will be be added to the currency regulator’s watch list, denied foreign-exchange quota for three years and subjected to anti-money-laundering investigations
    • Customers must confirm compliance with restrictions on money laundering, tax evasion and underground bank dealings
    • Customers must now confirm they aren’t lending or borrowing quotas to or from other citizens

    But the capital controls were just the spark: For months we've been warning that real estate markets in NYC and San Francisco, among others, are getting ready to rollover as the market is squeezed by already-high valuations and a flood of new luxury apartments (see here and here).

    As we reported back in December: With a substantial amount of capacity expected to come online over the next several quarters and a growth cycle that is entering its 8th year, one Chinese real estate investor admits "you get a sense now that it’s peaking."

    Of course, the mainstream media would be remiss if it didn't find some way to blame it all on Trump:

    As Bloomberg reports:

    Much of the slowdown has nothing to do with Trump. Concern is mounting that real estate prices have peaked following six years of record-shattering growth, and there are signs of overbuilding in large cities such as New York and San Francisco—the biggest beneficiaries of the recent boom.

    Some of this hesitancy, however, can be traced to Trump’s gilded door. Real estate investors worry that Trump’s industry-friendly tax cuts will fail to pass. At the same time, others figure that lower taxes and higher spending could spark inflation and rising interest rates—a liability in the debt-driven business.

    In fact, "uncertainty about the fate of Trump’s entire economic agenda is holding up deals across the country. Buyers and sellers “need to have shared expectations” before signing on the dotted line, said Jeff Friedman, a principal at Mesa West Capital, a Los Angeles-based real estate investment firm," Bloomberg reported.

    If investors are worried about rising interest rates, they should stop paying attention to the Federal Reserve's dubious projections. Remember, Trump wants to keep interest rates low; the dot are just a distraction.

    But that doesn't change the fact that the New York market is sagging as developers struggle with a glut of hotels, condos and apartment complexes following a multiyear construction boom. Now, landlords are slashing rents, and lenders are tightening loand requirements.

    Bloomberg uses Louis Ceruzzi, a developer who, like Trump, got his start outside Manhattan, as an example of how major projects have ground to a halt in the city. Two years ago, Ceruzzi and a Chinese partner bought a plot at 520 5th Avenue, paying $275 million – doubled the price paid for it in 2011. In late 2015, Ceruzzi told the Commerial Observer that construction would begin the following Spring.

    But more than a year later, theere's only "an empty lot, an idle backhoe and scattered piles of rubble," Bloomberg notes.

    Ceruzzi, for his part, didn't respond for comment. A picture of his land can be seen below.

     

  • And The Winner Of The 2017 Pulitzer Prize For Journalism Goes To…

    “unknown”

     

    Source: Townhall.com

  • Why Is The Trump Administration Rewarding Saudi War Crimes With More Weapons?

    Authored by Kristine Beckerle op-ed via The Hill,

    Last October the Saudi Arabia-led coalition bombed a funeral hall in Yemen’s capital, Sanaa, killing and wounding hundreds of people.

    “The scene was catastrophic,” one survivor told me.  “Beyond what I can explain to you or describe … There were burned bodies and dead bodies all over the hall.”

    Soon after that unlawful bombing, the Obama administration suspended the sale of nearly $400 million in weapons to Saudi Arabia.

    It was a recognition, a long time in coming, that the coalition’s military campaign in Yemen had devastated the country, killed thousands of civilians, and brought it to the brink of famine.

    After the funeral bombing, unlawful airstrikes continued, but the decision to suspend arms sales sent an important message to the Saudis. President Donald Trump, in his first trip abroad as president, is going to send an alternative, deeply troublesome message.

    While in Riyadh this weekend, Trump reportedly plans to announce more than $100 billion in arms deals to Saudi Arabia – nearly as much as Barack Obama authorized during his eight years in office.

    The deals  include Raytheon bombs, Lockheed Martin missile defense systems and BAE combat vehicles, and some  of the weapons whose sales had been suspended.

    The scars of unlawful airstrikes can be found across Yemen, where the Saudi-led coalition has carried out scores of attacks that hit homes, schools, markets, and hospitals since March 2015, when it began its military campaign against the Houthi armed group and forces loyal to the former longtime president Ali Abdullah Saleh. 

    Human Rights Watch has documented 81 apparently unlawful coalition attacks over the last two years, many possible war crimes. In almost two dozen of these cases, including the attack on the funeral hall, we were able to identify the US weapons that were used. 

    According to the United Nations, at least 4,773 civilians have been killed and 8,272 wounded since this conflict began, the majority by coalition airstrikes. The war has driven Yemen, already the poorest nation in the Middle East, toward humanitarian catastrophe. 

    Both the coalition and Houthi-Saleh forces have blocked or restricted critical relief supplies from reaching civilians. Seven million people face starvation, and cholera ravages parts of the country.

    Trump should be urging the Saudis to shift course by abiding by the laws of war and holding those responsible for past abuses to account. Instead he will effectively be telling them to continue as before and not to worry – the flow of US weapons will not stop.

    Trump will also be putting Americans at risk. Continued U.S. arms sales to a country that has repeatedly violated the laws of war exposes US officials to legal liability for aiding and abetting coalition war crimes.

    Some lawmakers in the U.S. are pushing back, introducing a bill intended to limit US arms transfers to Saudi Arabia. It would require the White House to certify that Saudi Arabia is taking all feasible precautions to minimize civilian casualties in Yemen, and stipulate that the White House must brief Congress on whether Saudi Arabia has used US weapons in previous unlawful attacks in Yemen. Other lawmakers have pledged to try to prevent future US arms sales to Saudi Arabia.

    Earlier this month, Secretary of State Rex Tillerson said: “If we condition too heavily that others must adopt [our] value[s]… it really creates obstacles to our ability to advance, our national security interests, our economic interests.” The Trump administration needs to recognize instead that protecting civilians in armed conflict is part and parcel of enhancing US national security.

    The U.S. cannot quietly hope that the coalition will take the blame for past and future atrocities like the funeral hall bombing. Yemeni civilians suffering from unlawful airstrikes know the US supports the coalition and that U.S. weapons have been used against them. This is the national security problem the administration should be paying more attention to.

    If the Trump administration won’t try to curtail war crimes by Saudi Arabia and the rest of the coalition, Congress should step in and make clear – by using its own power to stop weapons sales – that the lives of Yemeni civilian can no longer be disregarded.

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  • Friday Night "Intelligence Community" Leak: Russia Bragged About Flynn Connections in Private

    This has now reached TMZ styled gossip. Now the ‘intelligence community’, aka the CIA, are leaking private conversations between unnamed Russian officials who bragged about how they could influence Trump via Flynn? Who actually believes this malarkey?

    Let’s think this through for a minute.

    It’s fairly obvious the CIA/NSA/FBI loathe President Trump and have decided they want to remove him, or at least greatly diminish his power. These are the sort of leaks, however, that make them look desperate. How are we to believe an unnamed source intercepted the conversations of unnamed Russian officials who discussed how they could control Trump via their influence over Flynn?

    More importantly, I’ve never seen a man, who has otherwise served his nation with great distinction (Flynn), get ripped apart like this on a daily basis. It’s important to remember that Flynn’s son was a big pedogate/pizzagate theorist and had drawn the venomous ire of the left after John Podesta’s emails were obtained by the public.


    Content originally published at iBankCoin.com

     

  • Paul Craig Roberts Laments "The Assault On Trump"

    Authored by Paul Craig Roberts,

    We are witnessing an assault by the national security state and its liberal media on a President of the United States that is unprecedented.

    Wild and unsupported accusations of treasonous or illegal Russian connections have been the mainstay of the news since Trump’s campaign for president. These accusations have reached the point that there is an impeachment movement driven by the national security state and its liberal media and endorsed by Democrats, the American leftwing which has turned against the working class as “Trump deplorables,” and luminaries such as Harvard Law Professor Larry Tribe. The Washington Post, which was not present at the meeting of President Trump with Russian Foreign Minister Lavrov, purports to know that Trump gave Lavrov US national security information.

    The Russian government has offered the presstitute media a transcript of the meeting, but, of course, the pressitutes are not interested.

    The latest story is that Trump tried to bribe FBI Director Comey, before he fired him, not to investigate Trump as part of the “Russian investigation.” Clearly there is no intelligence left in the American media. The President doesn’t need to bribe someone he can fire.

    What we are witnessing is the determination of the national security state to keep their prized “Russian Threat” in its assigned role as the Number One Threat to the US. The liberal media, owned by the CIA since the 1950s is in accord with this goal.

    The American media is so accustomed to its enslavement by the national security state that it does not think of the consequences. But Professor Stephen Cohen does. I agree with him that the greatest threat to national security “is this assault on President Trump.” 

    Cohen said that there is a 4th branch of government, the intelligence community, which obstruts the management of American foreign affairs by the executive branch and Congress.

    As an example, he reminded us that “In 2016, President Obama worked out a deal with Russian President Putin for military cooperation in Syria. He said he was going to share intelligence with Russia, just like Trump and the Russians were supposed to do the other day. Our department of defense said it wouldn’t share intelligence. And a few days later, they killed Syrian soldiers, violating the agreement, and that was the end of that. So, we can ask, who is making our foreign policy in Washington today?”

    In the 1960s, President John F. Kennedy thought he was in charge, and he was assassinated for his belief. JFK blocked an invasion of Cuba, the Northwoods project, a preemptive nuclear strike on the Soviet Union, and spoke of ending the Cold War.

    In the 1970s President Nixon was driven from office, because he thought he was in charge of foreign policy. Like Kennedy, Nixon was a threat to the national security state. Nixon pushed through SALT 1 and the anti-ABM Treaty, and he opened to China, defusing those tensions as well. The military/security complex saw its budget dwindling as the threat dwindled. Nixon also determined to withdraw from Vietnam, but was constrained by the national security state. Nixon, the most knowledgeable president about foreign affairs, was forced from office, because his efforts in behalf of peace constituted a threat to the power and profit of the military/security complex.

    It is important to understand that there is no evidence whatsoever against Nixon in the Washington Post “investigation.” The Post’s reporters simply put together a collection of inuendoes that cast aspersion on Nixon, whose “crime” was to say that he learned of the Watergate buglary at a later date than he actually did. Nixon kept the burglary quiet until after his reelection, because he knew that the CIA’s Washington Post would use it in an effort to prevent his reelection.

    The “crime” for which Nixon was really removed was his success in establishing more peaceful and stable relations with Russia and China.

    Trump, being in real estate and entertainment, was unaware of the landmines on which he was stepping when he said it was time to normalize relations with Russia and to rethink the purpose of NATO.

    The US military/security complex sits on a budget extracted from very hard-pressed American taxpayers of $1,000 billion dollars annually. By threatening to normalize relations with the enemy which was created in order to justify this vast budget, Trump presented as the major threat to the American National Security State’s power and profit.

    This is why Trump will be broken and/or removed as President of the United States.

    Once again democracy in American is proving to be powerless. There is no one in Washington who can help Trump. Those who could help him, such as myself, cannot be confirmed by the US Senate, which is owned lock, stock, and barrel by the military/security complex, Wall Street, and the Israel Lobby.

    Trump tried to connect the suffering American people to their government, an act of treason against the oligarchy, who are now making an example of Trump that will dissuade politicians in the future from making populist appeals to the people.

  • "ShadowBrokers" Hacking Group Launches Subscription Service Selling Nuclear Secrets

    The hacking group known as 'The Shadow Brokers' is pushing a monthly subscription service offering members top secret information including "compromised network data" from the nuclear and ballistic missile programs of Russia, China, North Korea and Iran.

    As a reminder, we have noted in the past, many security experts believe the Equation Group is the National Security Agency, and that the Shadow Brokers may be part of a psychological operations campaign run by Russian intelligence.

    Shadow Brokers first emerged last August, offering to auction hacking exploits it said were used by the NSA’s elite hacking team known as Equation Group (officially named Tailored Access Operations). NSA whistleblower Edward Snowden and others confirmed the leak was authentic.

     

    In December, Shadow Brokers cancelled its auction and offered to sell the exploits.

     

    In April, the group released passwords to the rest of the hacking exploits in a move described as a protest against President Donald Trump for abandoning his base.

     

    The release included a Windows SMB [Server Message Block] exploit, EternalBlue, which was leveraged in the recent WannaCry global ransomware attack.

     

    In its Tuesday blog post, the group expressed its surprise that governments or tech companies didn’t bid in its past auctions.

    It said is has always been about “the shadowbrokers vs theequation group,” and implied the NSA is a cohort of tech companies like Microsoft.

    And now, as RT reports, the group’s monthly data dump could also include hacking exploits for web browsers, routers, and operating systems including Windows 10.

    "TheShadowBrokers Data Dump of the Month" is a new monthly subscription model, the group said.

     

    Payment will likely be made in the cryptocurrency Bitcoin given the group’s ransom demands in previous cyber attacks.

     

    The group also promised to include compromised financial data from the SWIFT international payment order system, used by banks to transfer trillions of dollars each day, as well as confidential data from several central banks.

    In a blog post published Tuesday, titled, ‘Oh Lordy! Comey Wanna Cry Edition’ the group accused the NSA of paying Microsoft to keep vulnerabilities in its software (and did not hold back in its accusations)

    If theshadowbrokers is telling the peoples theequationgroup is paying U.S technology companies NOT TO PATCH vulnerabilities until public discovery, is this being Fake News or Conspiracy Theory?

     

    Why Microsoft patching SMB vulnerabilities in secret? Microsoft is being embarrassed because theequationgroup is lying to Microsoft. TheEquationGroup is not telling Microsoft about SMB vulnerabilities, so Microsoft not preparing with quick fix patch. More important theequationgroup not paying Microsoft for holding vulnerability. Microsoft is thinking it knowing all the vulnerabilities theEquationGroup is using and paying for holding patch.

     

    Douche bag, dumbass, libtard, rich prick Head Microsoft Lawyer is running his cock holster because he is having ruff weekend doing real work. Head Microsoft Lawyer being angry because he is missing leisurely weekend playing the skin flute behind the country club.

     

    Real work is not being for executives. Real work is being for dirty foreign H1B workforce, happily working for less than stupid lazy American workers.

    Shadow Brokers finished its post saying if a responsible party were to buy “all lost data before it is being sold to the peoples” then the group would have no more financial incentives and would “go dark permanently.”

  • UK Government Moves Aggressively To Censor & Control The Internet

    Authored by Mike Krieger via Liberty Blitzkrieg blog,

    The following dystopian excerpts come from today’s UK Independent article titled, Theresa May to Create New Internet that Would Be Controlled and Regulated by Government:

    Theresa May is planning to introduce huge regulations on the way the internet works, allowing the government to decide what is said online.

     

    Particular focus has been drawn to the end of the manifesto, which makes clear that the Tories want to introduce huge changes to the way the internet works.

     

    “Some people say that it is not for government to regulate when it comes to technology and the internet,” it states. “We disagree.”

    Thanks for clearing that up.

    Senior Tories confirmed to BuzzFeed News that the phrasing indicates that the government intends to introduce huge restrictions on what people can post, share and publish online.

     

    The plans will allow Britain to become “the global leader in the regulation of the use of personal data and the internet”, the manifesto claims.

     

    It comes just soon after the Investigatory Powers Act came into law. That legislation allowed the government to force internet companies to keep records on their customers’ browsing histories, as well as giving ministers the power to break apps like WhatsApp so that messages can be read.

     

    The government now appears to be launching a similarly radical change in the way that social networks and internet companies work. While much of the internet is currently controlled by private businesses like Google and Facebook, Theresa May intends to allow government to decide what is and isn’t published, the manifesto suggests.

     

    The manifesto even suggests that the government might stop search engines like Google from directing people to pornographic websites. “We will put a responsibility on industry not to direct users – even unintentionally – to hate speech, pornography, or other sources of harm,” the Conservatives write.

    “Other sources of harm.” Can’t wait to see the ever-expanding government definition of that.

    Perhaps most unusually they would be forced to help controversial government schemes like its Prevent strategy, by promoting counter-extremist narratives.

     

    The manifesto also proposes that internet companies will have to pay a levy, like the one currently paid by gambling firms. Just like with gambling, that money will be used to pay for advertising schemes to tell people about the dangers of the internet, in particular being used to “support awareness and preventative activity to counter internet harms”, according to the manifesto.

     

    The Conservatives will also seek to regulate the kind of news that is posted online and how companies are paid for it. If elected, Theresa May will “take steps to protect the reliability and objectivity of information that is essential to our democracy” – and crack down on Facebook and Google to ensure that news companies get enough advertising money.

     

    If internet companies refuse to comply with the rulings – a suggestion that some have already made about the powers in the Investigatory Powers Act – then there will be a strict and strong set of ways to punish them.

    Given how willing tech companies have been to comply with government spying in the past, it’ll be interesting to see how they respond to this dangerous, authoritarian power grab.

  • Rising Occupancy In China's Fake Manhattan Is "Mostly Government Driven"

    China's copy of Manhattan is no longer a ghost town, Bloomberg reports. But that doesn't mean it has forever forestalled a "day of reckoning" for its debt-fueled growth.

    The northern city of Tianjin drew negative press coverage a few years ago because of a newly built replica of Manhattan complete with a mock Rockefeller Center that was created as part of a massive government infrastructure project but for years was little more than a ghost town.  But the city is now occupants are finally clocking to the city: Bloomberg reports that once empty skyscrapers, vacant office towers and unfinished hotels and apartments are gradually filling up amid the central government’s renewed push to refashion the city into a crucial gateway for a revitalized Northern China.

    As Bloomberg reports:

    There still may still be a financial reckoning for Tianjin looming in the future, but right now there are green shoots of economic life in the urban districts at the center of the city’s unprecedented construction boom.

    But there's a catch, of course: As is true for the broader Chinese economy, the growth in Tianjin "is mostly government driven, though there are signs private industry is coming."

    Here's more from Bloomberg:

    In the Binhai district, empty offices are filling up with staff from private companies as well as employees of some of the biggest state-owned enterprises, such as China National Chemical Corp., railcar manufacturer CRRC Corp., and China Poly Group Corp., a conglomerate with businesses ranging from explosives manufacturing to real estate." While many local governments across the country are struggling with heavy dependence on debt-fueled growth, Tianjin benefits more than almost any city from its position at the vanguard of two of the country’s biggest national projects.

    *  *  *

    Bloomberg saves one notable detail for the last paragraph of the story, citing an official who offers some local perspective: The city is supposed to play in important role in China's "one belt, one road" initiave, another massive debt-fueled trade and transport infrastructure project meant to replicate the ancient Silk Road trade routes that connected Europe and Asia. The government-funded expansion aims to join Beijing with the surrounding Hebei Province to create a mega city of 100 million people.

    It should come as no surprise that Tianjin has…backing from heavy hitters in the party.

    "We want the city to become one of the world’s largest ports like Singapore or Hong Kong," said Xiao Sheng, vice director of the free trade zone in Tianjin. "We want to develop a new business and development model that could be promoted to other regions in China."

    But even as China signs up foreign partners for its latest scheme, offering financial inducements like a $50 billion infrastructure investment in Pakistan, a key U.S. ally, some at least are showing unease at the massive debt-fueled spending necessary to bring the project into reality. 

    In a diplomatic showcase years in the making, Chinese President Xi Jinping invited leaders from 29 countries to hear his pitch about the "one belt, one road." But what's notable is that India, the worlds fastest growing and second-most populous country, didn't even bother to send a delegation, warning that the "unsustainable debt burden" required to launch the project would be a disaster for the countries involved.

    The story notes that though Tianjin's growth rate slipped to 8% last year – down from 9% the year before – it still outpaced 6.8% YoY rate for the broader Chinese economy in 2016. But that's a pretty low bar: China's economy grew in 2016 at its slowest pace in 26 years.

  • Venezuela: Forty Years Of Economic Decline, Part 2

    Authored by Jose Nino via The Mises Institute,

    This is Part Two of a two-part series. Part One is here.

    The brunt of the blame for Venezuela’s current economic catastrophe should fall on Hugo Chávez and his successor Nicolás Maduro. However, this does not mean that all was well in Venezuela before Chávez arrived on the scene. The ideological and institutional seeds of the current crises were sown decades earlier. A rising tide of government interventions in the marketplace during the 1960s and 1970s would soon lead to a host of new problems for Venezuela.

    The Oil Boom Party Ends

    The 1970s looked like a never-ending boom period for Venezuela thanks to high oil prices. The then-President Carlos Andrés Pérez took full advantage of this boom to implement his lavish social spending program. Eventually, the boom period came to a crashing halt by the early 80s, and Venezuela had to face a harsh economic downturn.

    Luis Herrera Campins would succeed Carlos Andrés Pérez’s government. From the start, he came to the realization that Pérez’s spending bonanza was unsustainable. In fact, Herrera had choice words for Pérez's policies, claiming that Pérez left him a "mortgaged" country.

    Although Herrera was correct in his assessment of the Pérez administration’s fiscal irresponsibility, he would ironically continue more of the same cronyist policies as his predecessor. The chickens eventually came to roost as Venezuela experienced its very own “Black Friday.”

    What once was one of the world’s most stable currencies, the Bolívar, experienced it’s most significant devaluation to date. Unfortunately, Herrera’s administration responded with heavy-handed exchange controls to stem capital flight. These controls would be administered by an agency called the “Differential Exchange Rate Regime” (RECADI), effectively creating a multi-tiered system of exchange rates.

    Considerable corruption scandals emerged during the succeeding government of Jaime Lusinchi, as countless members of the political class would exploit the multi-tiered exchange rate system for their own gain.

    Despite its abolition in 1989, RECADI would serve as a precursor to the byzantine exchange rate systems that the Commission for the Administration of Currency Exchange (CADIVI) and its successor, the National Center for Foreign Commerce (CENCOEX), would later preside over during the United Socialist Party of Venezuela’s period of dominance throughout the 2000s.

    All in all, Venezuela’s Black Friday devaluation marked the beginning of a lost decade of sorts for Venezuela throughout the 1980s that set the stage for subsequent devaluations, currency controls, and irresponsible fiscal policy further down the line.

    IMF to the Rescue?

    Rising poverty rates, increased foreign and public debt, corrupt state enterprises, and burdensome regulations contributed to an environment of growing social tension and economic malaise throughout the 1980s. Venezuela’s previous growth miracle became an afterthought at this point. And it’s golden goose, oil, could not bail it out thanks to the low oil prices of the 1980s.

    For Venezuela to right its ship, it would have to undergo painful fiscal reforms.

    Ironically, it was Carlos Andrés Pérez that was entrusted with reigning in the excessive government largesse; the very same leader that established Venezuela’s profligate welfare state and laid the foundations for its collapse in the 1980s.

    In 1988, Pérez campaigned on a platform that promised to bring back the splendor and prosperity of the 1970s. But once he assumed the presidency, Pérez realized that the Venezuela before him was on the verge of bankruptcy and crippled by excessive state intervention in the economy.

    Under the auspices of the IMF, Pérez made a half-hearted attempt in reforming Venezuela’s broken petrostate. When broken down and analyzed, these reforms consisted of tariff reductions, tax hikes, flawed privatizations, and marginal spending cuts that ultimately did not address the underlying problems with the Venezuelan political economy — its flawed monetary policy, burdensome regulatory framework, and entrenched crony capitalist policies.

    However, these reforms were too much for Pérez’s very own party, Acción Democrática (AD). AD was incensed by these reforms that hacked away at certain facets of the cronyist petrostate that it depended on to maintain its political power.

    Of note, the phasing out of gas subsidies by the Pérez government — a popular social program that artificially kept gas prices low for the impoverished sectors of Venezuelan society — was used by the AD to channel discontent among the general populace.

    Enter Hugo Chávez

    Countless individuals would then take to the streets and protest the so-called “austerity” policies of the Pérez government. This eventually led to the infamous “Caracazo” incident in 1989, where the capital city of Caracas was engulfed in a series of protests, lootings, and riots. The government responded in a heavy-handed manner, leaving hundreds dead.

    In the midst of the political chaos, radical groups took advantage of Venezuela’s political turmoil to advance their agenda. One of the most famous was then Lieutenant Colonel Hugo Chávez´s group, Revolutionary Bolivarian Movement-200 (MBR-200).

    Chávez took advantage of the political disarray by consolidating an anti-government movement within the ranks of the Venezuelan military. This culminated in the failed coup attempts of 1992.

    Even though Chávez was imprisoned for his coup attempt, Chavez’s agitation was enough to put the whole bipartisan Punto Fijo model into question. Eventually, corruption scandals and rising degrees of social unrest would whittle away at the Pérez administration’s legitimacy. The final nail in the coffin came when Pérez was impeached for corruption charges in 1992, thus putting the Punto Fjio model on the ropes.

    Collapse of the Punto Fijo Model

    Two coup attempts and the impeachment of Carl Andrés Pérez, marked the beginning of a tumultuous 1990s for Venezuela. The Venezuela of the 50s to 70s — characterized by its unprecedented economic prosperity and political stability — was starting to become a distant memory.

    By 1994, the Punto Fijo model was in shambles as Rafael Caldera assumed the presidency under a new coalition, Convergencia (Convergence), of disaffected political parties.

    Policywise, Rafael Caldera did not rock the boat. He pursued several of the IMF’s half measures, while not addressing structural problems such as the privatization of the oil industry, Venezuela’s downward spiraling monetary policy, and big business’s cozy relationship with the state. In addition, Caldera pardoned Hugo Chávez in 1994, rehabilitating him politically.

    Thanks to the failed land reforms and housing subsidization polices pursued by the two major social democrat parties (AD and COPEI) during previous decades, major metropolitan areas like Caracas, Maracaibo, Maracay, and Valencia began to be populated by a growing subsect of impoverished Venezuelans. Chávez would tap into this low stratum of Venezuelan society and effectively turn them into shock troops for his campaign to radically transform Venezuela into a full-blown socialist state.

    The Failure of the Social Democratic Era

    It is undeniable that Venezuela’s social democratic consensus delivered sub-optimal results. From 1958 to 1998, Venezuela’s per capita GDP growth was a paltry -0.13 % indicating that the Venezuelan populace grew faster than the wealth produced in that time frame. In his book, Introduction to Economic Growth, Charles I. Jones classified the Venezuelan case as an example of a “growth disaster.” Venezuela was one of two countries in Latin America that suffered negative growth during this 40-year period, the other being Nicaragua, a country that suffered a costly civil war and was under the rule of a socialist government.

    Chávez capitalized on this stagnation by launching a campaign against the bipartisan political consensus that ruled Venezuela at the time. Branding himself as a “Third Way” candidate, Chávez sought to provide an alternative to the perceived corruption of the Punto Fijo political order.

    Despite the rosy rhetoric, Chávez was surrounding himself with hardened Marxists and other collectivist figures that were hell-bent on subverting Venezuela’s already fragile political order. Little did the disillusioned voters that cast a ballot for Chávez know what they were about to get themselves into.

    Chavismo: Interventionism on Steroids

    While Chávez may have been correct in pointing out the corruption of the old Punto Fijo order, he would ironically continue many of its failed policies throughout his regime, amplifying their disastrous effects and implementing them in a tyrannical fashion.

    Currency controls, expropriations, price controls, and the use of the state-owned oil company, PDVSA, to finance lavish social spending programs were fixtures of Hugo Chávez’s socialist economic policy.

    In addition, Venezuelan political institutions were completely eviscerated, media outlets were suppressed, and political activists were subject to numerous human rights violations under Chávez’s heavy-handed rule.

    Chávez had the luxury of high oil prices from 2003 to 2010 to finance his socialist schemes and channel the petroleum rents to consolidate political support in the short term. But once oil prices plummeted, the laws of economics reared their ugly head and the system began to unravel in no time.

    Even with Chávez’s death in 2013, his brand of tyrannical socialism has continued unabated under the rule of his successor, Nicolás Maduro.

    The Venezuela that stands before us is a failed state. In an atavistic sense, Venezuela has returned to its 19th century state as an increasingly fragmented, political backwater.

    Time will tell if the Venezuelan nation will continue to exist as a cohesive whole, or if certain sectors of Venezuelan society decide to blaze their own trail and start to break up the country.

    Lessons Learned

    If Venezuelans want to restore Venezuela to its once prosperous state, they must look back and understand the genesis of Venezuela’s current crisis.

    It is myopic to pit the blame solely on demagogues and believe that things will be perfectly fine once the “right people” are put in charge. Political events like the rise of Hugo Chávez do not occur in a vacuum. Astute observers of political economy must analyze the overarching institutions and policies that create the type of political environment that enables authoritarians like Hugo Chávez to come into power.

    The Venezuelan case serves as a strong warning to many a European country with crumbling welfare states and growing social discontent. Sooner or later, unsustainable transfer systems are bound to collapse and social disorder ensues.

    Left unchecked, socialism only creates a vicious cycle of interventionism that leads to more chaos and misery. To reach the light at the end of the tunnel, Venezuela must completely abandon socialism and embrace the capitalist path to prosperity.

  • Structured Credit Bubble 2.0: Asian Investors Binge On "Boom-And-Bust" CLOs; Issuance Up 97% YoY

    Back in 2006, some of the wall street banks (ahem, Goldman) managed to layoff quite a bit of their mortgage risk to unwitting European and Asian investors who, in their desperate ‘search for yield’, had no idea they had just been conned into stepping in front of a freight train.  Now, it seems that the same thing may be happening yet again with another favorite wall street structured product, Collateralized Loan Obligations (CLOs).

    According to Bloomberg, money managers in Korea, Japan and China are piling into CLOs, and often into the most junior tranches no less, at an alarming rate which has resulted in a staggering 97% increase in YoY new issuance volume.

    Faced with near record-low interest rates at home, money managers in Korea, Japan and China have been piling into complex and increasingly risky structured loan products in America. Their investments in collateralized loan obligations — including the high-yield “equity’’ tranches most exposed to defaults — have helped drive a doubling of issuance in 2017.

     

    The bets have performed well so far. But some observers worry that Asian buyers are overlooking risks. Headwinds in the retail and energy sectors have raised the specter of defaults, while Moody’s Investors Service has stopped evaluating one type of CLO product amid concern that buyers will end up holding less creditworthy positions than they anticipated.

     

    “CLOs are a difficult investment universe, and CLO equity is a boom-and-bust product,’’ said Mike Terwilliger, a New York-based portfolio manager at Resource America Inc., which oversees more than $9 billion and invests in CLOs. “Investors need to make sure they’re being adequately compensated.’’

     

    “U.S. CLO equity is starting to look a little less attractive,” Tyler said. “Investors may want to lighten up on this space before there’s a turn in the credit cycle given the illiquid nature of CLO structures.”

    Meanwhile, non-U.S. money managers’ share of American CLO tranches with single-A credit ratings more than tripled to 21% last year, mostly due to surging demand from Asia, according to Citigroup Inc.

    Korea Post, which manages about $102 billion of savings and insurance products, said in March it had been adding to CLO holdings. Japan Post Bank Co. has made plans to boost exposure to the safest tranches, people familiar with the matter said in January. Gopher Asset Management, a Chinese investment firm that oversees $17.5 billion, is currently raising money for a second global credit fund that may invest in CLOs, said Chief Investment Officer PV Wang.

     

    Some “super-aggressive’’ Korean funds are buying equity tranches, according to Eugene Chun, who helps manage about $100 million of CLOs as a Seoul-based executive managing director at HDC Asset Management. Others are purchasing what’s known as combination notes, Chun said. The products blend investment grade and equity tranches to deliver higher yields while still maintaining adequate credit ratings.

    Helped by strong Asian demand, CLO issuance has totaled about $32 billion so far this year, up 97% from the same period in 2016, according to data compiled by Bloomberg.

    Of course, the reasoning is fairly simple and quite familiar for those of us who lived through the ‘great recession’.  With all-in yields on even the riskiest U.S. debt hovering at just over 5.5%, much lower than even the 2006/2007 bubble levels…

    HY

     

    wall street has a convenient product that takes ‘safe’ levered loans, packages them up in a nice little bundle and then sells them to folks all over the world with juicy yields and an investment grade rating.  It’s a win-win-win…lower risk, higher yield and IG rating…

    CLO

     

    Haven’t we seen this movie before?

  • Chinese Media Warns US Social Division Shows "Western Democracy Is Crumbling"

    Well known government mouthpiece, The China Global Times, published an op-ed overnight that was shockingly frank about the state of America (in their eyes) and did little to confirm President Trump's opinion that he and Premier Xi are best-buddies…

    President Trump's Troubles Are Not Going Away

    US President Donald Trump appears to be in big trouble. A memo by former FBI director James Comey exposed by The New York Times shows Trump had asked Comey to end an investigation into former national security adviser Michael Flynn in a meeting on February 14. US mainstream media and the Democratic Party accused Trump of obstruction of justice.

     

    Earlier, US media had reported that Trump leaked highly classified intelligence on the Islamic State to visiting Russian foreign minister Sergey Lavrov, yet Washington failed to share the same information with its allies to protect the source.

     

    As the attacks on Trump ramp up, many are now calling for him to be impeached. According to one poll, 48 percent supported impeachment, while 41 percent opposed. The numbers don't bode well for Trump.

     

    The American elite still refuse to accept Trump after his 100 days in the Oval Office. He is at odds with the mainstream media; insiders have constantly leaked information to the media. Now some commentators have compared the exposure of the Comey memo to the Watergate scandal. As Congress is under Republican control, few believe there will be a move to impeach the president, but these latest revelations will certainly further erode Trump's presidential authority.

     

    At the beginning of the corruption scandal, few believed that South Korean president Park Geun-hye would be impeached either. Could this be a reference for Trump's case? But evidence of Park's illegal activities was solid, while it will be more complicated to make determinations over whether Trump obstructed justice and leaked classified intelligence. 

     

    To impeach Trump will need more evidence from further investigation. To completely discredit Trump among voters, the present scandal is not enough as it does not add to the negative image of Trump. Many just think Trump often speaks off the cuff, which ends up in silly blunders. 

     

    If there is a major substantive scandal over and above him speaking out of turn then that will be another thing. But this is not the case at the moment.

     

    Every country has its own troubles. The US model represents Western democracy, but it is crumbling, and the resulting social division has become more and more serious. The US Deputy Attorney General Rod J. Rosenstein appointed a special counsel to oversee the investigation into link between Russia and the 2016 US presidential election and related matters on Wednesday. More juicy details will continue to appear and the rifts may become wider. Trump will become one of the most frequently accused Americans.

     

    The US won't be engulfed by chaos if its president is caught in a lawsuit. Someone has pointed out that no matter how chaotic the White House and Capitol Hill are, the overall operation of the US will not be a major problem as long as the enterprises and social organizations in the country are stable. This is seen as an advantage of the American system.

     

    Although American society is relatively stable, the political tumult can't be taken as an advantage of the US system. The fact is that US politics is in trouble, and the benefits brought by its system are being squandered.

    With friends like that, who needs North Korean enemies?

  • Journalists Drink Too Much, Are Dumber Than Average, Study Finds

    A recent scientific study just proved something that viewers of CNN have probably suspected for years: Journalists' brains function at a lower level than the rest of the population. 

    A study conducted by neuroscientist Tara Swift and the London Press Club determined that "the highest functions of journalists brains were operating at a lower level than the average population, due to dehydration, self-medicating, and fueling their brains with caffeine and high-sugar foods"

    "However, the pressures of the job are not affecting journalists ability to endure and bounce back from adversity in the long term, due to a belief that their work has meaning," according to a press release from the London Press Club.

    Journalists' brains show a lower level of executive function – that is, the ability of the brain to regulate emotions, suppress biases, switch between tasks, solve complex problems and think flexibly and creatively –  than the average person because to their heavy drinking, and caffeine consumption. They also eat too many high-sugar foods, and don't devote enough time to mindfulness.  

    Dr Swart recruited 31 journalists from across the industry to participate in the study. Participants were required to record their eating and drinking habits, answer a brain profile questionaire, take blood tests, and wear heart-rate variability monitors. 

    The study was initially launched to examine how journalists manage to "survive and thrive" while managing such high levels of occupational stress. "Journalism," the press release notes, "is one of many industries under an increasing amount of pressure in the digital age. Low pay, frequent deadlines, and high levels of accountability all contribute to high reported stress levels."

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  • AND NoW FoR IMPoRTaNT MeSSaGE FRoM THe DeeP STaTe…
  • Venezuela: Forty Years Of Economic Decline, Part 1

    Authored by Jose Nino via The Mises Institute,

    Venezuela Before Chavez: A Prelude To Soclialist Failure

    Venezuela’s current economic catastrophe is well documented. Conventional narratives point to Hugo Chávez’s regime as the primary architect behind Venezuela’s economic tragedy. While Chávez and his successor Nicolás Maduro deserve the brunt of the blame for Venezuela’s current economic calamity, the underlying flaws of Venezuela’s political economy point to much more systemic problems.

    Observers must look beyond stage one, and understand Venezuela’s overall history over the past 50 years in order to get a more thorough understanding of how the country has currently fallen to such lows.

    Socialism Before Chávez

    Analysts like to point to rosier pictures of Pre-Chávez Venezuela, but what these “experts” conveniently ignore is that the seeds of Venezuela’s destruction were sowed during those “glory years.” Years of gradual economic interventionism took what was once a country bound to join the ranks of the First World to a middle-tier developing country. This steady decline eventually created an environment where a demagogue like Chávez would completely exploit for his political gain.

    The Once-Prosperous Venezuela

    To comprehend Venezuela’s long-term decline, one must look back at what made it so prosperous in the first place. Before the completion of its first oil field on April 15, 1914, Venezuela was essentially a Banana Republic marked by political instability. This was largely a consequence of its colonial past and the period following its independence from Spain. Despite gaining independence from Spain, Venezuela maintained many of its primitive political and economic practices, above all, its exclusionary mercantilist and regulatory policies that kept it in an impoverished state.

    However, the discovery of oil in the early twentieth century completely changed the entire ballgame. The powerful agricultural aristocracy would be supplanted by an industrialist class that sought to open its oil markets to multinational exploitation and foreign investment. For the first time in its history, Venezuela had a relatively liberal, free market economy and it would reap countless benefits in the decades to come.

    From the 1910s to the 1930s, the much-maligned dictator Juan Vicente Gómez helped consolidate the Venezuelan state and modernized an otherwise neocolonial backwater by allowing market actors, domestic and foreign, to freely exploit newly discovered oil deposits. Venezuela would experience substantial economic growth and quickly establish itself as one of Latin America’s most prosperous countries by the 1950s.

    In the 1950s, General Marcos Pérez Jiménez would continue Gómez’s legacy. At this juncture, Venezuela was at its peak, with a fourth place ranking in terms of per capita GDP worldwide.

    More Than Just Oil

    While oil exploitation did play a considerable role in Venezuela’s meteoric ascent from the 1920s to 1970s, this only scratches the surface in explaining how Venezuela became so prosperous during this period. A combination of a relatively free economy, an immigration system that attracted and assimilated laborers from Italy, Portugal, and Spain, and a system of strong property rights, allowed Venezuela to experience unprecedented levels of economic development from the 1940s up until the 1970s.

    As mentioned earlier, Venezuela was at the height of its prosperity during the military dictator Marcos Pérez Jiménez’s regime. Like Juan Vicente Gómez’s regime, Pérez Jiménez’s stewardship of Venezuela was characterized by heavy political repression.

    Venezuela’s capitalist structure remained largely intact during Pérez Jiménez’s tenure, albeit with creeping degrees of state involvement. Pérez Jiménez did introduce some elements of crony capitalism, pharaonic public works projects, and increased state involvement in “strategic industries” like the steel industry. Nevertheless, the Pérez Jiménez regime was open to foreign investment, let the price system function normally in most sectors of the economy, and did not embark on creating a profligate welfare state.

    The Road to Social Democracy

    Despite the prosperity brought about by Venezuela’s booming economy in the 1950s, Marcos Pérez Jiménez’s government drew the ire of many left-leaning activists due its heavy-handed measures. The tipping point came in 1958, when these leftist activists, working in tandem with a sympathetic military, successfully overthrew Pérez Jiménez in a coup. Pérez Jiménez would live the rest of his life in exile and would be a figure of derision among Venezuelan intellectual and political elites, despite the unprecedented economic and social development under his watch.

    Following the 1958 coup, naval officer Wolfgang Larrázabal occupied the presidency briefly until general elections were held later that year. Notable social democrat political leader Rómulo Betancourt would come out on top in these elections and assume the presidency from 1959 to 1964. The Fourth Republic of Venezuela — Venezuela’s longest lasting period of democratic rule, was established under Betancourt’s administration. In 1961, a constitution was introduced, dividing the government into 3 branches — executive, legislative, and judicial — and establishing an activist role for the Venezuelan state in economic affairs.

    This political order was further consolidated by the establishment of the Punto Fijo Pact. The Punto Fijo Pact consisted of a bipartisan agreement between two political parties — Acción Democratica (Democratic Action) and COPEI (Christian Democrats) — that laid the foundation for a social democratic political order and alternation of power between the two parties.

    What seemed like a genuine move toward democratic stability, Venezuela’s Fourth Republic marked the beginning of a process of creeping socialism that gradually whittled away at Venezuela’s economic and institutional foundations.

    The Socialist Origins of Venezuela’s Pro-Democracy Advocates

    Venezuela’s current collapse did not happen overnight. It was part of a drawn out process of economic and institutional decay that began decades before.

    When Venezuela returned to democracy in 1958, it looked like it was poised to begin an era of unprecedented prosperity and political stability.

    However, Venezuela’s democratic experiment was doomed from the start, and one needn’t look any further at the political background of its very own founder, Rómulo Betancourt, to understand why it’s entire political system was built on a house of cards.

    Rómulo Betancourt was an ex-communist who renounced his Marxist ways in favor of a more gradualist approach of establishing socialism. Despite evolving into more of a social democrat, Betancourt still believed in a very activist role for the State in economic matters.

    Betancourt was part of a generation of intellectuals and student activists that aimed to fully nationalize Venezuela’s petroleum sector and use petroleum rents to establish a welfare state of sorts. These political figures firmly believed that for Venezuela to become a truly independent country and free itself from the influence of foreign interests, the government must have complete dominion over the oil sector.

    Under this premise, a nationalized oil industry would finance cheap gasoline, “free” education at all levels, healthcare, and a wide array of other public services.

    This rhetoric strongly resonated among the lower and middle classes, which would form the bulwark of Betancourt’s party, Acción Democrática, voter base for years to come.

    At its core, this vision of economic organization assumed that the government must manage the economy through central planning. Oil would be produced, managed, and administered by the state, while the government would try to phase out the private sector.

    Interventionism from the Start

    Betancourt’s administration, while not as interventionist as succeeding 4th Republic governments, capped off several worrisome policies, which included:

    1. Devaluation of the Venezuelan currency, the Bolívar.
    2. Failed land reform that encouraged squatting and undermined the property rights of landowners.
    3. The establishment of a Constitutional order based on positive rights and an active role for the Venezuelan state in economic affairs

    Betancourt’s government followed-up with considerable tax hikes that saw income tax rates triple to 36%. In typical fashion, spending increases would be accompanied with these increases, as the Venezuelan government started to generate fiscal deficits because of its out of control social programs. These growing deficits would become a fixture in Venezuelan public finance during the pre-Chávez era.

    The Nationalization of the Oil Industry

    While Betancourt did not achieve his end goal of nationalizing the Venezuelan oil industry, his government laid the foundation for subsequent interventions in that sector.

    Thanks to the large oil boom of the 1970s, the government of Carlos Andrés Pérez capitalized on the unprecedented flow of petroleum rents brought about by the 1970s energy crisis where oil-producing countries like Venezuela benefited handsomely from high oil prices.

    Betancourt’s vision was finally achieved in 1975, when Carlos Andrés Pérez’s government nationalized the petroleum sector. The nationalization of Venezuela’s oil industry fundamentally altered the nature of the Venezuelan state. Venezuela morphed into a petrostate, in which the concept of the consent of the governed was effectively turned on its head.

    Instead of Venezuelans paying taxes to the government in exchange for the protection of property and similar freedoms, the Venezuelan state would play a patrimonial role by bribing its citizens with all sorts of handouts to maintain its dominion over them. 

    On the other hand, countries based on more liberal frameworks of governance have citizens paying taxes, and in return, these governments provide services that nominally protect the life, liberty, and property of its citizens. The state is not the owner, thus giving the citizens a strong check against the Leviathan should the government overstep its boundaries.

    Oil Nationalization: A Pig Trough for Politicians

    Pérez would take advantage of this state power-grab to finance a profligate welfare state and a cornucopia of social welfare programs that resonated strongly with the populace. As a result, deficit spending became embraced by the political class and increasing levels of foreign and public debt would become the norm in Venezuelan fiscal affairs.

    At this juncture, Venezuela’s economy became overwhelmingly politicized. Oil boom periods were characterized by an inflow of petrodollars that the state used for pharaonic public works and social projects as a means to pacify the populace.

    In reality, no real wealth creation took place during these boom periods, as the state redistributed the rents according to political whims and usurped functions traditionally held by civil society and private economic actors. When politicians and bureaucrats oversee businesses, decision-making is based on partisan and state interests rather than efficiency and consumer preferences.

    Although the nationalization of the petroleum industry did not result in an immediate economic downturn, it laid the groundwork for institutional decay that would clearly manifest itself during the 80s and 90s.

  • Close Friend of Comey, Ben Wittes, Makes Up Absurd Story About Comey Being 'Disgusted' by Trump Hug

    If Comey admits to being ‘disgusted’ by ‘hugging’ Trump, I fucking promise to eat a shoe on my inactive periscope account. When I clicked on this stupid story from The Shill, I figured I’d just watch it and move on. So I got to watching it and as it went on, it became more absurd, almost perverse, in the blatancy of the lies being purported by this former Washpo editor and Brookings Institue faggot.

    If you’re a democrat and believe this is a person of repute, feel free to fuck yourself. Look at this submental, literally making the story up as he went along the faggot rode paved for him by the PBS eunuch.

    ‘He really wanted to blend in and not be singled out. He’s wearing, if you watch the video, he’s wearing a blue blazer. And he stands in the room that is as far from Trump that is physically possible to be and also against blue drapes that are the same color as his –‘

    ‘He chose that spot?’

    ‘He chose that spot because it was almost like a chameleon or camouflaged against the wall.’

    Fuck yourself Ben Wittes.

    It’s worth noting, Wittes has a black belt in Taekwondo. I still like my chances in beating him senseless, if afforded the chance, however.

    Content originally published at iBankCoin.com

     

  • The Russian Obsession Goes Back Decades

    Authored by Jacob Hornberger via The Future of Freedom Foundation,

    Just consider the accusations that have been leveled at the president:

    1. He has betrayed the Constitution, which he swore to uphold.
    2. He has committed treason by befriending Russia and other enemies of America.
    3. He has subjugated America’s interests to Moscow.
    4. He has been caught in fantastic lies to the American people, including personal ones, like his previous marriage and divorce.

    President Donald Trump?

    No, President John F. Kennedy.

    What lots of Americans don’t realize, because it was kept secret from them for so long, is that what Trump has been enduring from the national-security establishment, the mainstream press, and the American right-wing for his outreach to, or “collusion with,” Russia pales in comparison to what Kennedy had to endure for committing the heinous “crime” of reaching out to Russia and the rest of the Soviet Union in a spirit of peace and friendship.

    They hated him for it. They abused him. They insulted him. They belittled him. They called him naïve. They said he was a traitor.

    All of the nasties listed above, plus more, were contained in an advertisement and a flier that appeared in Dallas on the morning of November 22, 1963, the day that Kennedy was assassinated. They can be read here and here.

    Ever since then, some people have tried to make it seem like the advertisement and flier expressed only the feelings of extreme right-wingers in Dallas. That’s nonsense. They expressed the deeply held convictions of the Joint Chiefs of Staff, the CIA, the conservative movement, and many people within the mainstream media and Washington establishment.

    In June 1963, Kennedy threw down the gauntlet in a speech he delivered at American University, now entitled the “Peace Speech.” It was one of the most remarkable speeches ever delivered by an American president. It was broadcast all across the communist Soviet Union, the first time that had ever been done.

    In the speech, Kennedy announced that he was bringing an end to the Cold War and the mindset of hostility toward Russia and the rest of the Soviet Union that the U.S. national-security establishment had inculcated in the minds of the American people ever since the end of World War II.

    It was a radical notion and, as Kennedy well understood, a very dangerous one insofar as he was concerned. The Cold War against America’s World War II partner and ally had been used to convert the United States from a limited-government republic to a national-security state, one consisting of a vast, permanent military establishment, the CIA, and the NSA, along with their broad array of totalitarian-like powers, such as assassination, regime change, coups, invasions, torture, surveillance, and the like. Everyone was convinced that the Cold War — and the so-called threat from the international communist conspiracy that was supposedly based in Russia — would last forever, which would naturally mean permanent and ever-increasing largess for what Kennedy’s predecessor, President Dwight Eisenhower, had  called the “military-industrial complex.”

    Suddenly, Kennedy was upending the Cold War apple cart by threatening to establish a relationship of friendship and peaceful coexistence with Russia, the rest of the Soviet Union, and Cuba.

    Kennedy knew full well that his actions were considered by some to be a grave threat to “national security.” After all, don’t forget that it was Guatemalan President Jacobo Arbenz’s outreach to the Soviets in a spirit of friendship that got him ousted from power by the CIA and presumably targeted for assassination as part of that regime-change operation. It was Cuban leader Fidel Castro’s outreach to the Soviets in a spirit of friendship that made him the target of Pentagon and CIA regime-change operations, including through invasion, assassination, and sanctions. It was Congo leader’s Patrice Lamumba’s outreach to the Soviets in a spirit of friendship that got him targeted for assassination by the CIA. It would be Chilean President Salvador Allende’s outreach to the Soviets in a spirit of friendship that got him targeted in a CIA-instigated coup in Chile that resulted in Allende’s death.

    Kennedy wasn’t dumb. He knew what he was up against. He had heard Eisenhower warn the American people in his Farewell Address about the dangers to their freedom and democratic way of life posed by the military establishment. After Kennedy had read the novel Seven Days in May, which posited the danger of a military coup in America, he asked friends in Hollywood to make it into a movie to serve as a warning to the American people. In the midst of the Cuban Missile Crisis, when the Pentagon and the CIA were exerting extreme pressure on Kennedy to bomb and invade Cuba, his brother Bobby told a Soviet official with whom he was negotiating that the president was under a severe threat of being ousted in a coup. And, of course, Kennedy was fully mindful of what had happened to Arbenz, Lamumba, and Castro for doing what Kennedy was now doing — reaching out to the Soviets in a spirit of friendship.

    In the eyes of the national-security establishment, one simply did not reach out to Russia, Cuba, or any other “enemy” of America. Doing so, in their eyes, made Kennedy an appeaser, betrayer, traitor, and a threat to “national security.”

    Kennedy didn’t stop with his Peace Speech. He also began negotiating a treaty with the Soviets to end above-ground nuclear testing, an action that incurred even more anger and ire within the Pentagon and the CIA. Yes, that’s right — they said that “national security” depended on the U.S. government’s continuing to do what they object to North Korea doing today — conducting nuclear tests, both above ground and below ground.

    Kennedy mobilized public opinion to overcome fierce opposition in the military, CIA, Congress, and the Washington establishment to secure passage of his Nuclear Test Ban Treaty.

    He then ordered a partial withdrawal of troops from Vietnam, and told close aides that he would order a complete pull-out after winning the 1964 election. In the eyes of the U.S. national-security establishment, leaving Vietnam subject to a communist takeover would pose a grave threat to national security here in the United States.

    Worst of all, from the standpoint of the national-security establishment, Kennedy began secret personal negotiations with Soviet Premier Nikita Khrushchev and Cuban leader Fidel Castro to bring an end to America’s Cold War against them. That was considered to be a grave threat to “national security” as well as a grave threat to all the military and intelligence largess that depended on the Cold War.

    By this time, Kennedy’s war with the national-security establishment was in full swing. He had already vowed to tear the CIA into a thousand pieces and scatter it to the winds after its perfidious conduct in the Bay of Pigs fiasco. By this time, he had also lost all confidence in the military after it proposed an all-out surprise nuclear attack on the Soviet Union, much as Japan had done at Pearl Harbor, after the infamous plan known as Operation Northwoods, which proposed terrorist attacks and plane hijackings carried out by U.S. agents posing as Cuban communists, so as to provide a pretext for invading Cuba, and after the Cuban Missile Crisis, when the military establishment accused him of appeasement and treason for agreeing not to ever invade Cuba again.

    What Kennedy didn’t know was that his “secret” negotiations with the Soviet and Cuban communists weren’t so secret after all. As it turns out, it was a virtual certainty that the CIA (or NSA) was listening in on telephone conversations of Cuban officials at the UN in New York City, much as the CIA and NSA still do today, during which they would have learned what the president was secretly doing behind their backs.

    Kennedy’s feelings toward the people who were calling him a traitor for befriending Moscow and other “enemies” of America? In response to the things that were said in that advertisement and flier about him being a traitor for befriending Russia, he told his wife Jackie on the morning he was assassinated: “We are heading into nut country today.” Of course, as he well knew, the nuts weren’t located only in Dallas. They were also situated throughout the U.S. national-security establishment.

  • 31 Fascinating Facts On The Early History Of The US Dollar

    Today, we all know the U.S. dollar as an iconic currency that is recognizable to people around the world.

    And while Visual Capitalist's Jeff Desjardin has previously looked at the buying power of the U.S. dollar over time, as well as important events like the Great Depression, we have not looked at the history of the dollar itself.

    How and why was it conceived, and why do we call it a “dollar” or a “buck”? How did the dollar’s early history help to shape today’s world?

    Courtesy of: The Money Project

    Before the Dollar

    For the early colonists, currency was a bit of a free-for-all.

    Officially, cash was denominated in pounds, shillings, and pence, but in reality things were a different story. Cash was often scarce, and colonists needed to be innovative to fulfill transactions. At various points in time, they used tobacco, beaver skins, and wampum in the place of money. Some colonies even tried to issue their own fiat currencies – many of which went bust.

    As it turned out, the Spanish dollar was often the most abundant form of cash – and this is what led to U.S. currency eventually being denominated in dollars.

    The Revolution

    During the American Revolution in 1775, the Continental Congress issued a money known as the Continental Currency to try and fund the war. The government printed too many, and the value of a Continental diminished rapidly.

    Just five years later, after runaway inflation, the Continental was worth 2.5% of its face value. Benjamin Franklin rightly noted that the depreciation of the Continental had, in fact, acted as a tax to pay for the war. Holders of the currency – everyday people – were punished by losing massive amounts of buying power. Interestingly, this is where we get the phrase “Not worth a Continental”.

    Birth of the Dollar

    The failure of the Continental Currency must have been top of mind during the writing of the Constitution. A clause was even added, under Article 1, Section 10, to make sure such a failure would never happen again. It was written that states were not permitted to “coin Money; emit Bills of Credit; [or] make any Thing but gold and silver Coin a Tender in Payment of Debts.”

    And so, the Coinage Act of 1792 created the U.S. dollar as a standard unit of currency. The U.S. Mint was authorized to oversee coinage, and the Act also established a penalty of death for debasing coinage issued by the Mint.

    The Almighty Buck

    In the 19th Century, a new slang term emerged for the dollar.

    Especially in the Great Lakes area, different amounts of money were equated with animal skins. One particular reference showed that in Ohio in 1851, the skin of a muskrat was worth $0.25, and that of a doe was worth $0.50. Meanwhile, the skin of a buck was equal to the “almighty dollar” – and hence, the word “buck” became synonymous with the U.S. dollar.

    The Civil War

    Leading up to the Civil War, private banks around the country issued their own paper currencies.

    With 10,000 or so of these currencies in circulation as the war broke out, governments soon found it very cumbersome to try and pay debts with many different types of notes. As a result, the $10 Demand Note was the first official paper currency issued in 1861 by the government to help finance the war.

    The North began paying debts with a fiat currency called the “greenback”, while Confederate states issued their own paper currency as well. The latter was worthless by the time the Confederacy lost the war.

    The Counterfeiting Problem

    Around this time, counterfeiting was a widespread problem with greenbacks and all the private notes that were circulating. More than 1/3 of bills were fake at this time.

    Sophisticated counterfeit operations were happening in British Canada, and some bank engravers would even moonlight as counterfeiters, using the same plates and dyes they had from their day job.

    To deal with the problem, the Secret Service was formed in 1865.

    The Modern Dollar

    Counterfeiting measures have come a long way since the late 19th century. Today, it’s estimated that less than 0.01% of notes are fake.

    Learn more about the modern U.S. dollar in the next part of this series.

    *  *  *

    The Money Project is an ongoing collaboration between Visual Capitalist and Texas Precious Metals that seeks to use intuitive visualizations to explore the origins, nature, and use of money.

  • Inside The US Government's Plan To Survive Nuclear War (While The Rest Of Us Die)

    Authored by Sadie Dingfelder, originally posted at The Washington Post,

    In 2011, a staffer at Washingtonian found a government ID in a Metro parking garage and gave it to Garrett M. Graff (the magazine’s editor-in-chief at the time) to track down its owner. “Since I reported about that world, he figured I’d know what to do with it,” Graff says.

    Graff immediately noticed something strange.

    “The back of the ID had these evacuation instructions on it. And so I got on Google Maps and followed the instructions and they led to a road that very clearly went into the side of a mountain, and you can see on the Google satellite view big concrete bunker doors.”

    Raven Rock, a hollowed out mountain near the Maryland-Pennsylvania border, is reportedly one of the undisclosed locations Dick Cheney worked from after 9/11.

    That discovery inspired Graff to comb through newly declassified documents to learn more about the U.S. government’s plans in the event of a nuclear war or other catastrophe. His research culminated in the new book “Raven Rock: The Story of the U.S. Government’s Secret Plan to Save Itself — While the Rest of Us Die.”

    At first, the government didn’t plan to let “the rest of us die.”

    “In the early 1950s, the government really hoped and believed it would be able to save most Americans,” Graff says.

     

    As bombs became more destructive, “plans and ambitions gradually shrunk until, realistically, the best they could hope to do is save the senior leadership.”

    Drills and disasters have shown that the federal government is too complex and unwieldy to pluck out of D.C. by helicopter and set up in an underground bunker — though that was, and still is, the basic plan, Graff says.

    One such shelter is the mountain fortress Graff tracked down: Raven Rock. Here’s more on it, plus other tidbits from doomsday scenarios past and present.

    Raven Rock

    This compound, carved out of a mountain near the Pennsylvania-Maryland border, contains several freestanding, multistory buildings (on giant, shock-absorbing springs) for a total of 900,000 square feet of office space. It has its own subterranean water supply, too. Raven Rock is where top government and military officials would hide out in the event of a major attack on Washington, D.C.; it was reportedly one of the “undisclosed locations” former Vice President Dick Cheney worked from in the aftermath of the Sept. 11 attacks.

    Mount Weather

    Another major underground government complex, Mount Weather has been in use since the 1950s. Located at the border of Loudoun and Clarke counties in Virginia, the 600,000-square-foot bunker inside the mountain was once (and still may be) the official evacuation site for Supreme Court justices, documents such as the U.S. Constitution and the Declaration of Independence, and the National Gallery of Art’s most valuable paintings.

    E-4B ‘doomsday planes’

    These custom-built 747s, also known as “Air Force One When It Counts,” are flying war rooms that follow the president when he travels internationally.

    When POTUS is stateside, one plane sits ready on a runway at a Nebraska military base, “fully staffed with battle planners and war planners and meteorologists and anything else you might need to run a nuclear war,” Graff says. The planes are protected from electromagnetic pulse attacks with a fine wire mesh, and they can unfurl a 5-mile-long wire that allows communication with nuclear submarines.

    Survival crackers

    In the 1960s, the U.S. government distributed 150 million pounds of wheat crackers and biscuits to fallout shelters across America. Packages are still routinely found unopened in civic building basements, and apparently they don’t taste great. “I did actually find on eBay a box of them, but I haven’t been brave enough to try them in part because I have watched enough YouTube videos of other people trying them to know how disgusting they actually are,” Graff says.

    Button #13

    In the late 1970s, the D.C. mayor’s emergency control center at 300 Indiana Ave. NW had a Plexiglas-shielded button that, when pressed, triggered “Emer-zak,” the broadcast of emergency messages to lobbies, elevators and anywhere else served by the Muzak system.

    *  *  *

    While much of this is known, given the recent "Gotham Shield" nuclear attack drill and Washington D.C.'s recent "terror attack drill", one can't help but wonder if these old bunkers and emergency systems are getting dusted off… just as Hawaiian officials have already demanded.

  • Chinese Phone Giant Admits To "Unprecedented Degree" Of Falsified Revenue

    Fabricating data in China, it turns out, is not only a favorite government pastime. Publicly traded, if state-owned, phone giant Unicom Group fabricated financials relating to 1.8 billion yuan ($261 billion) in revenue over a five-year period from 2012 to 2016 – or as the company admitted, it engaged in an "unprecedented degree of falsified revenue."  This is China we are talking about, where the definition of "unprecedented" is very different from the US.

    Lest there be any confusion, Bloomberg further elucidated that Unicom "engaged in organized, cross-departmental faking of financial figures" – according to an internal document leaked to Bloomberg. The disclosure is just another reminder of just how endemic fraud is at both government agencies and various enterprises in China. Recall that back in January, People’s Daily confirmed what everyone had known: the government was officially making up numbers in the rust-belt province of Liaoning, and fabricated fiscal numbers after the local economy was crippled by the commodity crunch. 

    In a statement provided to Bloomberg, company officials claimed the fraud had a “relatively small impact” on the company and that figures had already been corrected in its financial statements. To assure investors, the company claims it has now strengthened oversight, having sacked 70 managers who were allegedly responsible for the fraud. It has also strengthened its monitoring efforts. Of course, with non-existant government oversight, corrupt auditors and "pay me as you go along" internal supervision, the numbers will remain as cooked as ever.

    What was interesting was the timing of the leak: the report appeared as the Unicom Group is preparing to raise billions in capital from private investors after the firm was one of six state-owned enterprises selected for a pilot program in mixed ownership. Some have speculated that the leaker is either a disgruntled insider, or a case of industrial sabbotage with the document being passed to Bloomberg by a bidder hoping to buy at a more attractive price.

    Hong-Kong based analyst Steven Liu of China Securities International also downplayed the significance of the disclosure, arguing the “irregularities” wouldn’t materially impact the company's bottom line. What was to be expected: after all Liu has a buy rating on the stock.

    Here are a few more selections from the leaked document, courtesy of Bloomberg:

    • About 17% of the total falsified revenue came from Shaanxi’s Tongchuan and Yulin cities, while the Hanzhong branch falsified more than a third of its revenue
    • Penalties ranged from dismissals to administrative warnings, suspended party membership and salary deductions
    • Managers were punished according to the Communist Party disciplinary guidelines
    • The nature and repercussions of the fraud are "unprecedented" in Unicom’s history, according to the document

    The news rocked shares of Unicom on Thursday; they closed at HK$10.24 after falling 3.2%, the largest drop in a month. Shares of China United Network Communications, its Shanghai-listed arm, have been suspended since late March, pending further disclosure of its mixed-ownership plan. Who knows what fraud is hiding there.

    Despite authorities’ claims to the contrary, the fraud is, of course, representative of how managers at large Chinese corporates react when the numbers don't match their expectations. The Hong-Kong listed arm of the company has seen revenue fall during each of the last three years, together with profits for the last two as competition in the space has intensified. The leak offers a glimpse into how Chinese firms react when business starts to slow: managers hoping to preserve their reputations, not to mention their jobs, and keep the government-funded money spigot flowing have every incentive to falsify revenues and profit figures.

    Incidentally, US companies do the same thing, only there it's called non-GAAP EPS (and revenue) and adjusted effective tax rate and remains perfectly legal.

  • Is There A Coup Attempt Underway In America?

    Authored by Mike Krieger via Liberty Blitzkrieg blog,

    Personally, I’m horrified by the fact that Goldman Sachs goons are in total control of the Trump administration’s economic policy. I’m also horrified that our new President’s first overseas trip will be to the terrorist state of Saudi Arabia, a autocratic, brutal monarchy with undeniable ties to 9/11. I’m likewise disgusted by Attorney General Jefferson Sessions’ oppressive and uncivilized relaunch of the misguided and disastrous “war on drugs.” Finally, I’m very troubled by the fact Mike Flynn attempted to disrupt a military operation using Syrian Kurds to rout ISIS in Raqqa because Turkey didn’t like it, given he was working as a paid agent of Turkey months earlier and never disclosed it.

    There are a plethora of things to be deeply concerned about when it comes to Trump, yet the coup attempt against him being launched by elements of the deep state, corporate media and Hillary dead-ender Democrats is more concerning still. It’s obvious what’s happening right now is not a sincere attempt to hold a President accountable, or fight him on policy or personnel choices. Rather, this all seems to be a very deliberate and premeditated attempt to remove him from office.  

    What’s so troubling about what I just wrote is not so much that I think it, but that it’s becoming accepted truth by a growing number of mainstream Americans. For example, can you believe CNBC actually published a post with the following title?

    Here are a few excerpts from the piece:

    There is, indeed, a bombshell of a story coming out of the news that President Donald Trump revealed sensitive information during his White House meeting with Russian officials last week. But it’s not that President Trump committed any crime. The really alarming news is that the duly-elected President of the United States appears to be the target of a political coup.

     

    First, let’s be clear: President Trump has been sloppy, arrogant, and just plain misguided plenty of times during his short tenure in office — including the way he handled the firing of FBI Director James Comey and the hiring and firing of National Security Adviser Michael Flynn. And if he did unnecessarily compromise the source of the sensitive information he shared with the Russians, shame on him.

     

    But a president cannot be removed from office for arrogance and sloppiness…

     

    Here’s the kicker: None of this is actually working where it counts. Again, we have not one piece of evidence of any impeachable act. And it’s not even truly working in the polls. President Trump’s approval ratings may be lower than any modern president this early in his tenure, but they’re still higher than they were throughout the election. If anything, these constant attacks coming from this obviously angry and potentially illegal place are only strengthening the resolve of Trump’s base of supporters. They elected a guy they believed was truly the enemy of the established political class. And right on cue, the established political class is stopping at nothing to prove them right.

     

    For all the things President Trump has said that have dragged down the level of our American political discourse, this sustained takedown effort is worse. And it’s not clear how this is going to end. Unlike President Trump, the leakers remain anonymous and thus unaccountable. They can presumably go on forever.

     

    And President Trump doesn’t seem like he’s going to stop fighting back or irritating and threatening his political opponents.

     

    But don’t fool yourself into thinking this is OK or even tolerable. The bottom line is that we have some very powerful people in Washington who really don’t like how democracy played out this time around and what they do to attack it next isn’t going to be any better than what they’re doing now.

     

    Luckily the American people remain wisely circumspect about all of this. President Trump’s polls aside, the voters are still giving him a decent shot to govern. And unaccountable people in Washington shouldn’t be trying to make that decision for us.

    Once again, I want to remind you the above was published at CNBC. Sure it’s a vapid Wall Street oligarch-worshipping rag, but it’s still pretty mainstream.

    Moreover, it’s not just CNBC writers and obscure bloggers such as myself who are coming to these sorts of conclusions.

    For example, listen closely to what Dennis Kucinich had to say on the topic in a recent interview.

    I agree with Dennis completely, and another troubling aspect of all this is that the hysteria incessantly being driven by the corporate press in its attempt to destroy Trump is distracting attention away from genuine scandals. For example, yesterday’s McClatchy story on Mike Flynn’s undisclosed work as a agent of Turkey, and how that may have influenced his foreign policy recommendations appears to be a very real and extremely concerning scandal. Yet it gets buried in the hyperbole and hysteria, and millions of people end up tuning everything out.

    The road we’re headed down is unhealthy, counterproductive and extremely dangerous. As is typically the case, you can thank the corporate press.

  • Chinese Fighter Jets Conduct "Unprofessional" Inverted Intercept Of US Radiation Detector Over Yellow Sea

    In the second incident between US and Chinese planes this year, two Chinese Su-30 fighter jets came within 150 feet of a U.S. Air Force WC-135 radiation detection plane while it was flying over the Yellow Sea in international airspace on Wednesday, CNN reports, citing an unidentified U.S. official.

    The Chinese jets came within 150 feet of the US plane, with one of the Su-30s flying inverted, or upside down, directly above the American plane, the official said. 

    As CNN reports, the US plane involved was an Air Force WC-135 jet.

    Dubbed the "Constant Phoenix," the four-engine WC-135 jet looks for distinctive elements a nuclear test of any type would emit into the air. The collected samples can be analyzed to determine exactly what occurred.

    The WC-135 has been regularly deployed on routine missions in Northeast Asia, according to the US official. The planes have been used in the past to gather evidence of possible nuclear tests by North Korea.

    There was a modest reaction in USDJPY on the headline…

    This is the second 'intercept' this year. In February, US defense officials said there was an "unsafe" close encounter between a US Navy P-3 Orion aircraft and a Chinese surveillance aircraft over the South China Sea. In that incident, a US official told CNN the US Navy plane had to alter course to ensure there wasn't a collision with what one official said was a People's Liberation Army Air Force KJ-200. The planes came within 1,000 feet of each other, US officials said.

    And with a second carrier heading towards the Korean Peninsula, we suspect more are inevitable (despite US officials saying close encounters between US and Chinese forces are extremely rare).

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  • World Money: Five Hidden Signals From The IMF

    Authored by Craig Wilson via The Daily Reckoning blog,

    Less than a month ago a handful of the world’s policy makers gathered in Washington at the International Monetary Fund (IMF), no surprising headlines were run – but an obscure meeting and a discreet report launched exclusive signals for the next global economic crisis.

    The panel, which included five of the most elite global bankers, was held during the IMF’s spring meetings to discuss the special drawing rights (SDR) 50th anniversary.  On the surface the panel was a snoozefest, but reading beyond the jargon offers critical takeaways.

    The discussion revealed what global central banks are planning for a future crisis and how the IMF is orchestrating policy for financial bubbles, currency shocks and institutional failures.

    Why the urgency from the financial elites?

    In theApril 2017 “Global Financial Stability Report,” IMF researchers targeted the U.S corporate debt market and how extreme changes in its equity market has left the global economy at risk. While the report may have been missed by major financial news outlets, it was enough to give major concern to those paying attention.The IMF research report noted:

    “The [U.S.] corporate sector has tended to favor debt financing, with $7.8 trillion in debt and other liabilities added since 2010…”

    In another segment the IMF report said:

    “Corporate credit fundamentals have started to weaken, creating conditions that have historically preceded a credit cycle downturn. Asset quality—measured, for example, by the share of deals with weaker covenants—has deteriorated.”

    “At the same time, a rising share of rating downgrades suggests rising credit risks in a number of industries, including energy and related firms in the context of oil price adjustments and also in capital goods and health care. Also consistent with this late stage in the credit cycle, corporate sector leverage has risen to elevated levels.”

    This report  together with the panel discussion highlights a very concerning trend. Jim Rickards, a currency wars expert and macroeconomic specialist, has identified the special drawing rights (SDR) as a class of world money that is a tool used to bailout central banks during crisis.

    World Money, The IMF and Signals for Economic Crisis

    World money was praised for its ability to be a catalyst for international loans during the IMF spring panel discussion.

    The panel discussion was moderated by Maurice Obstfeld, an established academic who serves as a Director of Research at the IMF. Obstfeld is connected, knows the right people, and can see the macroeconomic implications of SDRs.

    World Money SDR

    In his opening remarks Obstfeld identified, “There has been increasing debate over the role of the SDR since the global financial crisis. We in the Fund have been looking more intensively at the issue over whether an enhanced role for the SDR could improve the functioning of the international monetary system.”

    “The official SDR is something we are familiar with but is there a role for the SDR in the market or a market SDR? What is the SDR’s role for the unit of account?”

    Here’s the five most important signals from the world money panel, what they could mean for the international monetary system and the future of the dollar.

    1. China Spars for the SDR Market

    Yi Gang, the Deputy Governor of the People’s Bank of China disclosed to the IMF panel that, “China has started reporting our foreign official reserves, balance of payment reports, and the international investment position reports.”

    “All of these reports, now, in China are published in U.S dollars, SDR and Renminbi rates… I think that has the advantage of reducing the negative impact of negative liquidity on your assets.”

    What that means in real terms is that China views the opportunity of being a part of the exclusive world money club as an opportunity to diversify away from the U.S dollar.

    The Bank of China official took that message even further saying that he hopes that China could lead in world money operations by integrating it into the private sector.

    Yi Gang

    “If more and more people, companies and the market use SDR as unit of accounts – that would generate more activity in the market with focus on the MSDR. [The hope would be] that they could create more products and market infrastructures that would be available for trade products to be denominated in SDR.”

    The People’s Bank of China official referenced how this trend was already underway. Just last year Standard Chartered bank began to maintain accounts in SDR’s. “In terms of the first and secondary markets they will develop fairly well.”

    Perhaps the most important segment that the Chinese official signaled was his reference that, “The Official Reserve SDR (OSDR) that allocation from the IMF is very important. [This allows] Central Banks to make the SDR an official asset, and easier for them to convert that asset into the reserve currency they need.”

    What that means is that China will become an even greater player in the world money market.

    Nomi Prins, an economist and historian stated when analyzing China’s economic positioning, “The expanding SDR basket is as much a political power play as it is about increasing the number of reserve currencies for central banks for financial purposes.”

    2. Special Drawing Rights: The Case for Liquidity and Central Banks

    Jose Antonio Ocampo, one of the foremost scholars on international economics and a board member of the Central Bank of Colombia noted, “The main objective of SDR reform is actually… for it to be a major reserve asset for the international monetary system.”

    “First of all, it is a truly global asset. It is backed by all of the members of the IMF and it doesn’t have the problems that come with using a national currency as international currency. Second, it has a much better form of distribution of the creation of liquidity. Because it is shared by all members of the IMF… in that regard, it does serve as unconditional liquidity.”

    That means that IMF and institutional economists view the SDR as a potential way of financing not only national government loans, but markets.

    The most fascinating point that Ocampo made about the SDR was about the position of conditional reserves and what it could mean for more SDR reform. Conditional reserves reference the ability of central banks to borrow and repay loans in a timely manner with conditionality.

    “Countries that hold excess SDR’s should deposit them in the IMF. The IMF then could use those SDR’s to finance its lending. [This will reduce] the need to have quotas, borrowing arrangements and methods to finance IMF programs. Like any decent central bank in the world they could use their own creation of liquidity as a sort of financing of that central bank.”

    While the IMF has been a “central bank for central banks” this proposal would see the international monetary system shift entirely.

    Jim Rickards takes his analysis a step further showing that the liquidity and lending offer the IMF the ability to act during a crisis, as it did during the most recent global financial crisis.

    Rickards, The New York Times best-selling author, reveals, “The 2009 issuance was a case of the IMF ‘testing the plumbing’ of the system to make sure it worked properly. With no issuance of SDRs for 28 years, from 1981–2009, the IMF wanted to rehearse the governance, computational and legal processes for issuing SDRs.”

    “The purpose was partly to alleviate liquidity concerns at the time, but also partly to make sure the system works in case a large new issuance was needed on short notice.”

    3. Elites Signaling the Blueprint Plan for World Money

    Mohamed El-Erian a former Deputy Director of the IMF and the Chief Economic Adviser at Allianz (affiliated with PIMCO) was the premier panelist to discuss the future blueprint plan of world money.

    El-Erian started out his discussion, “If the SDR is to play a really important role you cannot go through the official sector only today.”

    He outlined the current political landscape for world money saying, “The politics today do not favor delegating economic governance from national to multilateral levels. Yet the case for the SDR is very strong.”

    “It is not only about the Triffin Dilemma and [acting as] the official reserve, it’s because if you ask anybody do you want to reduce the cost of self-insurance, they’ll say yes. Do you want to facilitate diversification? They’ll say yes. If you ask anybody, do you want to make liquidity less reciprocal, they’ll say yes.”

    “The SDR helps address every one of these issues. So, it solves problems not just at the official level but it solves problems in the private sector.”

    To break that jargon down Jim Rickards offers, “In other words, the latest plan is for the IMF to combine forces with mega-banks, and big investors like BlackRock and PIMCO to implement the world money plan.”

    “El-Erian is ‘signaling’ other global elites about the SDR plan so they can prepare accordingly.”

    4. The SDR Signals Death of the Dollar

    Catherine Schenk, a professor of International Economic History at the University of Glasgow, is one of the top scholars of economic relations. While speaking she took up the case of what the special drawing rights meant for the U.S dollar.

    Dr. Schenk when asked whether the international market could proceed without a “lender of last resort” she pressed, “Why would you use a relatively illiquid element when you have the U.S dollar?”

    “The U.S dollar has a lot of problems, some of it is unstable but the depth and liquidity of it in financial markets are unrivaled. The history of trying to create bond markets for other currencies or other instruments shows that it takes a long time.”

    She then elaborated later in the conversation the premise that, “What we are talking about with the market SDR is trying to turn it and add more facilities to turn it into money. That will take time. Having reluctant issuing, I am worried about how that market it going to be created.”

    As the dollar continues to have its issues what central banks like the Federal Reserve select to do matters significantly.

    Christopher Whalen pens, “Whether you look at US stocks, residential housing markets or the dollar, the picture that emerges is a market that has risen sharply, far more than the underlying rate of economic growth. This is due to a constraint in the supply of assets and a relative torrent of cash chasing the available opportunities.”

    Whalen then asks the bigger question and one that could specifically matter for the SDR when he notes, “What happens when this latest dollar super cycle ends?”

    How the competition for the top world reserve position unfolds between the SDR and U.S dollar will be answered in time.

    5. World Money Becomes Central Bank Money

    During the final Q&A for the panel on the SDR’s, they were asked what the political climate looks like facing the issues of world money and the direction of political headwinds?

    In response Jose Antonio Ocampo said, “In the issue of liquidity, we still have a basic problem during a crisis – which is, how do you provide liquidity during crisis?”

    Ocampo, the Colombian central bank official disclosed, “My view is that it is a function for the SDR as central bank money, let’s say.”

    The SDR specialist took it further, “The real question is whether any of the major actors… and whether the U.S, either from the previous administration or the current administration, was willing [to politically act]?”

    He offered, “From the point of view of the U.S the use of SDR’s as a market instrument should be more problematic than the reforms of the SDR to be used as central bank money.”

    Under such circumstances the demand and confidence for the U.S dollar as a global reserve would be diminished.

    Jim Rickards summarizes, “By the time the final loss of confidence arrives, much of the damage will already have been done. The analytic key is to look for those minor events pointing in the direction of lost confidence in the dollar.”

    “With that information investors can take defensive measures before it’s too late.”

    As was confirmed by both the IMF report and the elite panel on special drawing rights, the U.S dollar is facing severe competition while undergoing a fiscal crisis.

    Rickards leaves a stark warning, “The U.S. is playing into the hands of these rivals by running trade deficits, budget deficits and a huge external debt.”

  • Cyber Attacks Are The Perfect Trigger For A Stock Market Crash

    Authored by Brandon Smith via Alt-Market.com,

    The world has been stunned over the past few days by the advent of “Ransomware;” the use of sophisticated cyber attacks on vital systems in order to (supposedly) extort capital from target businesses and institutions. I am always highly suspicious whenever a large scale cyber incident occurs, primarily because the manner in which these events are explained to the public does not begin to cover certain important realities. For example, the mainstream media rarely if ever discusses the fact that many digital systems are deliberately designed to be vulnerable.

    Software and internet corporate monoliths have long been cooperating with the NSA through programs like PRISM to provide government agencies backdoor access to computer systems worldwide. Edward Snowden vindicated numerous “conspiracy theorists” in 2013 with his comprehensive data dumps, exposing collusion between corporations and the NSA including Microsoft, Skype, Apple, Google, Facebook and Yahoo. And make no mistake, nothing has changed since then.

    The level of collusion between major software developers and the establishment might be shocking to some, but it was rather well known to alternative analysts and researchers. The use of legislation like the Foreign Intelligence Surveillance Act (FISA) to skirt Constitutional protections within the 4th Amendment has been open policy for quite some time. It only made sense that government agencies and their corporate partners would use it as a rationale to develop vast protocols for invading people’s privacy, including American citizens.

    The issue is, in the process of engineering software and networks with Swiss cheese-like defenses in the name of “national security,” such exploits make vast spreads of infrastructure vulnerable to attack. I think it likely this was the intention all along. That is to say, the NSA and other agencies have created a rather perfect breeding ground for false flag attacks, real attacks and general crisis.

    It should be noted that the Ransomware attacks which struck systems around the world used “Wannacrypt,” derived from an NSA exploit called “Eternalblue.” This program was designed to specifically target Microsoft Windows machines, no doubt using vulnerabilities which Microsoft ENGINEERED into their own software. Now, interestingly, a batch of NSA exploits was published online by a hacker group called “the shadow brokers” only last month. From the information I have gathered so far, it seems that “Eternalblue” was part of that data dump and that the Ransomware incident is directly connected.

    Something else that is very interesting about Eternalblue — as CNN notes, similar exploits were used not long ago by the NSA to get backdoor access to financial data within the SWIFT banking system. This was rather odd because through international agreements the NSA already had front door access to such data. However, front door access can be tracked and traced and any illicit activity can be exposed. Therefore, the NSA must have had something more nefarious in mind than simply looking for terrorist activity, such as testing the effectiveness of their own exploits for future use in attacks.

    I mention the incident with SWIFT because it brings up a potential danger that I don’t think many people have considered.

    First, let’s assume for a moment that groups like the “shadow brokers” actually exist and aren’t some kind of NSA created front. These groups are using the considerable weaknesses that corporations like Microsoft put in place for the NSA in order to reap profits through criminal enterprise or to commit terrorist acts. The NSA and its Silicon Valley partners literally created this monster; a monster which has the capacity to attack otherwise secure banking networks like SWIFT.

    This begs the question – how much of the global banking system and global stock exchanges are open to attack with these same NSA exploits. I would suggest that ALL of them are.

    Second, let’s consider for a moment the possibility that groups like the “shadow brokers” are mostly fraudulent fronts for establishment agencies and elitists. Consider that maybe, just maybe, the NSA is releasing some of these exploits on purpose to the public. Why? Well, one might consider that issue complicated, but to summarize, it may be very advantageous for international banks and governments to deliberately place financial systems at risk.

    In my article The Economic End Game Explained, I outline in detail with evidence why the establishment is seeking a major economic crisis within the near term. Organizations like the IMF have been talking excitedly for the past few years about something they call “the great global economic reset.” The details behind this “reset” are rather vague, but the general notion is that the economic systems of today are going to evolve in a painful way and that certain elements of our fiscal structure could be wiped clean altogether. In order for such a “reset” to take place, some kind of crisis event would be needed or would happen inevitably as a consequence.

    In order for a new economic system to be entrenched, the old system has to be dismantled; but how can banking moguls and globalist interests succeed in doing this without taking the blame for the ultimate social and geopolitical suffering and carnage that would result? Well, they would need scapegoats.

    Some of these scapegoats will be political in origin. For example, the mainstream media has been pumping out non-stop rhetoric suggesting that the next global crisis will be a direct result of the “rise of populism and nationalism” within Western societies. Meaning conservatives, classical liberals and sovereignty champions are the new patsies for economic instabilities that the globalists built into the system long ago.

    Some of these scapegoats, though, will be far more illusory and intangible.

    It is my belief that agencies like the NSA are unleashing some of their own exploits to the public on purpose. But what does this accomplish?  For one, it makes the use of false flag attacks more viable. If attacks like Ransomware continue to escalate, the public may in a sense become normalized to them. What if one of these attacks targets major financial elements? Say the large networks of algorithmic computers that dominate stock transactions today come under threat; what would be the result? Most likely complete market disaster. And, almost everyone in the world will believe the culprit was some kind of terrorist hacking group, rather than the establishment itself, which has the most to gain from this brand of catastrophe.

    Also, the establishment may simply be hoping that if they release enough of these exploits which they have been devising for years, someone will use them to attack the financial system autonomously. That is to say, the establishment does not necessarily need to use false flag attacks to bring down stock markets or banking networks. All they need to do is put the weapons out in the open and wait for someone to fall to temptation and do their dirty work for them.

    I would compare this to the act of forcefully injecting millions of Muslim immigrants into western nations without a rational vetting process. If the elites want more terrorism in Europe, for instance, they don’t have to do all the work of forming domestic cells and training the members as they have done in the Middle East with ISIS. All they have to do is leave the front door wide open in the name of “humanitarianism” and allow the enemy to waltz right in.

    This strategy gives the establishment plausible deniability while also giving them the crisis environment they secretly desire.

    Our economy and the economies of most nations today stand upon a razor’s edge. Historically negative data is now reported weekly. Hard and “soft” data indicates a massive downturn is lurking under the surface. In fact, the ONLY elements of the economy which remain “positive” are stocks and some currencies. This is what we call a bubble scenario. The globalists have managed to stretch equities markets for years on the back of untold stimulus measures, but this illusion is quickly coming to an end.

    Central banks are backing away from quantitative easing and steadily increasing interest rates, removing cheap debt as a tool to prop up stocks. The era of easy money is almost over. It seems to me that this is a perfect time for a trigger event that is completely unrelated to the financial elites, an event that will distract the public away from their culpability. This is not to say that a cyber attack on our market networks will be the only trigger event or distraction, but I am starting to think it will be a primary measure, no doubt while the world is mesmerized by James Comey "memos" and other such nonsense.

    The NSA and other organizations have handcrafted global networks to fail, and not just fail, but fail spectacularly leaving maximum destruction in their wake. I do not think this was done without foresight. Events like Ransomware might only be the beginning. Watch this trend carefully, and be extra vigilant if cyber attacks begin to target financial institutions and systems. If this does happen, the “great economic reset” may not be far away.

  • Brazil Plunges Into Fresh Political Crisis After Temer "Hush Money" Recordings Emerge; Market Crashes

    The presidency of Brazil’s Michel Temer, who replaced disgraced and impeached predecessor Dilma Rouseff last summer, lasted about one year without a major corruption scandal.

    That changed tonight, when Brazil’s O Globo newspaper which was instrumental in exposing the Carwash scandal which ultimately led to Rouseff’s downfall and the arrest and incarceration of countless politicians, reported that the chairman of meatpacking giant JBS secretly recorded his discussion with Temer about “hush money” payments to jailed former House Speaker Eduardo Cunha in return for his silence.


    Brazil’s President Michel Temer

    The allegations are the latest development in Operation Carwash, a sprawling corruption probe that has implicated many of Brazil’s business and political elite, including some in the president’s own party. Temer has repeatedly denied any wrongdoing.

    Readers may recall that in a delightfully ironic case study of political irony and power vacuum, Eduardo Cunha, the conservative Brazilian political leader who led the push in 2016 to oust Dilma Rousseff, was sentenced in March to more than 15 years in prison himself, when a Brazil judge found him guilty of corruption, money laundering and illegally sending money abroad, all in connection with the sprawling graft investigation involving the state-run oil company Petrobras, and which Cunha himself used as a pretext to dispose of Rouseff.

    The tragically ironic Cunha was the highest-profile politician to be sentenced as a result of the Operation Car Wash investigation into corruption at Petrobras, which has shaken Brazil’s political and business establishments to their core. Ultimately, he was convicted of charges that included receiving bribes during Petrobras’ acquisition of a Benin oil field for $35.5 million in 2011, and of money laundering crimes between 2011 and 2014. Yet somehow he was the man tasked with bringing justice to Rouseff.

    Furthermore, Cunha, once a powerful member of Temer’s ruling party, has previously said he had compromising information about a host of senior politicians linked to a vast political bribery scandal at state oil firm Petrobras. And yet he never spokeup.

    Now, not only do we know why Cunha kept silent, but there is finally proof of a corruption link between Cunha and Temer himself.

    According to the O Globo report, JBS Chairman Joseley Batista recorded the discussion with Temer about hush money the executive paid to Cunha, according to the newspaper. The report did not say what Cunha was asked to keep quiet about. When Batista told Temer he was paying Cunha to remain silent, the president was recorded saying, “You need to keep that up, okay?”


    Batista and Temer

    Temer on Wednesday acknowledged he had met with the JBS Chairman in March but denied any part in alleged efforts to keep jailed former House Speaker Eduardo Cunha from testifying.

    According to O Globo, executives from JBS submitted a tape to the Supreme Court of a secret recording of Temer approving a payment to the abovementioned Cunha. Batista and his brother, JBS Chief Executive Wesley Batista, presented the recording to prosecutors as part of plea bargain negotiations underway since March.

    Reuters adds that  JBS also hired a law firm to discuss a leniency deal with the U.S. Department of Justice. JBS declined to comment immediately.

    To be sure, the presidential press office immediately issued a statement vehemently denying the allegations. “President Michel Temer never requested payments to obtain the silence of ex-deputy Eduardo Cunha,” it said. “The president defends a deep and wide investigation to get to the bottom of the claims put forward in the media.”

    Unfortunately for Temer, Brazil appears to no longer believe politician lies, especially of Temer, whose approval rating is in the single digits. As a result, as Bloomberg writes, “Brazil has plunged back into political crisis, reminiscent of the chaos surrounding last year’s impeachment process.”

    Bloomberg adds that O Globo’s report caused an immediate stir in Congress, where opposition congressmen started to shout anti-government slogans. The session was subsequently suspended. Legislators from five opposition parties called for Temer’s resignation and early elections, according to a statement sent by the opposition leader in the lower house. Temer went to his official residence after an emergency meeting with some of his closest aides.

    According to further press reports, legislators from 5 opposition parties have demanded Temer’s resignation and call for new elections, according to statement from lower house opposition leader’s press office. And while the US spent much of the day talking about impeachment, in Brazil they actually did it: Rede party deputy Alessandro Molon filed an impeachment request against Temer, according to his press office.

    The local authorities already know what’s coming: amid growing protests in Brasilia on Wednesday evening, military police have moved into position around the presidential palace and one of the judges on Brazil’s Supreme Court has called for calm. “It’s a moment for calm, moderation and watching the institutions work,” said Marco Aurelio Mello.

    “We still need more information, but on the face of it there’s enough to say that it weakens substantially the government,” said Andre Cesar, an independent political analyst. “I see a huge increase in the difficulties in approving reforms. Pension reform could take a step back.”

    The head of the Brazilian Bar Association, Claudio Lamachia, said in a statement that society needs immediate answers and that the alleged recordings need to be made public as soon as possible. “Brazilians can no longer live with doubts regarding their representatives,” Lamachia said.

    On Wednesday evening, people were already lining up on the streets of Sao Paolo, preparing to protest against Temer:

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    Meanwhile, the same market which soared last year after the Rouseff impeachment, for some still unknown reason, is now plunging on the news. A Brazilian ETF trading in Tokyo, tumbled more than 8% on the O Globo news, its biggest drop since September 2015.


    At this point it is unclear if there is any politician left in Brazil who has not been tainted by the Carwash scandal; it is also not clear who could possibly replace Temer when he too is kicked out of office, in light of the unprecedented power vacuum on all sides that currently exists in the Latin American country.

  • Are Auto-Makers Bailing On Their Job-Creation Pledges?

    Carmakers quickly kowtowed to Trump after his upset victory over Hilary Clinton on Nov. 8, allowing the then-president-elect to take credit for their pledges to hire thousands of workers and keep U.S. factories open. 

    At the time, fears of a 35% import tariff were enough to keep them in line. But while Trump still has the support of his voter base, the administration is having a hard time whipping up votes in Congress. Trump has struggled to pass a plan to repeal and replace Obamacare – a law that almost nobody in the Republican party wants to keep. So it's difficult to imagine the administration passing something as controversial as the import tax any time soon. 

    But, now that its become apparent that Trump doesn't wield absolute authority over Republicans in Congress, The Wall Street Journal is asking: When will the corporate sector jump ship?

    From WSJ:

    Detroit has been an engine of growth for U.S. employment since the financial crisis, with General Motors Co. , Ford Motor Co. and Fiat Chrysler Automobiles NV adding tens of thousands of jobs to keep pace with growing demand and fund autonomous-car engineering and other moonshot programs. Total auto employment manufacturing, including parts suppliers, hit 945,000 in April, 50% higher than industry employment in 2009 when GM, Chrysler and several auto suppliers were undergoing bankruptcy restructuring.

     

    Earlier this year, company executives promised to add head count at certain factories in response to criticism from President Donald Trump.

     

    Now, those executives are quickly retreating.

     

    GM and Ford are making cuts to their U.S. workforces that could far outpace the job commitments made in recent months amid political pressure. Amid softening U.S. car sales and mounting investor skepticism about Detroit's ability to weather the industry's first downturn in nearly a decade, auto executives are facing a tough choice in whom to please: Wall Street or the White House.

     

    Auto sales have fallen for four straight months. Inventory is near record highs. Used-care sales prices are falling. R&D budgets have become bloated. And interest rates are half a percentage point higher than they were five months ago.

    Unless the Trump administration can swiftly furnish the 4% economic growth, these companies have every incentive to pull back. And judging by Ford's decision earlier this week to slash 10% of its workforce, they're not willing to wait.

    Auto stocks have largely missed out on the broad market rally; At $33, shares of GM are trading at their November 2010 IPO price. Ford shares are down 12% YTD at $10.94, while Fiat-Chrysler has seen modest gains.

    Meanwhile, Tesla shares are soaring even as Elon Musk and his merry band of futurists have yet to turn a profit. And that alone should be enough to make auto execs like Mary Barra, who receive an increasing percentage of their compensation in stock, forget all those promises made during the heady days leading up to the inauguration.

  • The Most Important Question That No One Is Asking…

    With every mainstream media orifice chock full of prognosticators speculating on what Trump must have done given the anonymously-sourced reports about Comey, Russia, and Cock-holsters; there appears to be one question that very few dare ask…

    If Trump indeed asked Comey to end the Flynn probe, why was Comey so silent about the meeting for two months?

    One such American who dared to ask the question is infamous neocon Rep. Peter King (R-NY), who told Fox News tonight that he has “real questions” for Comey…

    “If Director Comey in any way thought that he was being intimidated or the president was trying to interfere with an investigation, I believe that Director Comey had an obligation to report that, report it to the Justice Department, to tell those around him,” King said.

     

    “Because that could be considered a crime, and as director of the FBI, he had an obligation to make that known.”

    He added that Comey also had an obligation to share that information with the House and Senate intelligence committees when he testified before them.

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    Watch the latest video at video.foxnews.com

    King said he is not aware of Comey speaking to anyone in Congress about any interference in any ongoing investigations into Flynn, Russia or the Trump campaign.

    “If this was as serious as it’s now being made out to be, why has Director Comey been so silent for the last two months?” King said.

    Next week’s Comey hearing could be more exciting than we thought as the answer to those questions is unlikley to be covered by the standard “that’s classified” response.

    We note that King’s comments – somewhat defending President Trump – come shortly after Senator McCain’s Trump-defending comments… did Trump ‘cross the aisle’ to the neocons?

  • McMaken: Dismantle The FBI, And Give Its Money Back To The States

    Authored by Ryuan McMaken via The Mises Institute,

    With James Comey's firing, we're told the FBI is in turmoil, and Washington DC cocktail parties are all atwitter over the excitement of the scandal. But don't worry about the FBI. If history has proved anything, the Bureau, no matter how much chaos it may endure, can always rely on a fat check from Congress — funded by the American taxpayers. 

    But why does the US need a huge national police force at all? Can't state police forces do just as well? The FBI continues to assert never-proven claims that bigger governments are better at law enforcement than smaller onces. This myth is not only untrue, but very expensive for taxpayers. 

    The FBI's Gravy Train

    The FBI is very well paid. The 2017 budget request for the FBI, for instance, is for $8.7 billion. That's up from 2014's budget of $8.4 billion. That may not seem like a lot compared to say, the Defense Department's typical haul of $500 to $600 billion. But as far as law enforcement agencies in the United States go, the FBI is awash in money.  

    It's so much money, in fact, that if the FBI were abolished, and the sum were divided up into 50 even portions for the states, each state would receive $174 million dollars.

    That's not chump change. The entire public safety budget for the Illinois State Police in 2016, for example, was $242 million. Even if every state got an equal share of the FBI's budget back, the Illinois state Police could increase their public safety budget by 71 percent. 

    Illinois, though, is the sixth largest state (by population) in the Union. Just imagine what smaller states could do with a similar amount were those monies not used to pay for the FBI's latest efforts to raid peaceful political gatherings in Texas, or provide private luxury jets for politicians.  The total budget of the Colorado State Patrol, for instance — including everything from salaries to public relations — is $144 million.

    But what a great racket the FBI has going. As an arm of a federal government that prints its own money, the FBI need never worry about any meaningful budget cut. Moreover, it keeps getting bigger budgets regardless of its ineptitude. And ineptitude is easy to find. As James Bovard reported this week in USAToday:

    Before the 9/11 attacks, the FBI dismally failed to connect the dots on suspicious foreigners engaged in domestic aviation training. Though Congress had deluged the FBI with $1.7 billion to upgrade its computers, many FBI agents

     

    ad old machines incapable of searching the Web or emailing photos. One FBI agent observed that the bureau ethos is that "real men don’t type. … The computer revolution just passed us by."

     

    The FBI’s pre-9/11 blunders "contributed to the United States becoming, in effect, a sanctuary for radical terrorists," according to a 2002 congressional investigation. (The FBI also lost track of a key informant at the heart of the cabal that detonated a truck bomb beneath the World Trade Center in 1993.)

     

    In the late 1990s, the FBI Academy taught agents that subjects of investigations "have forfeited their right to the truth." This doctrine helped fuel pervasive entrapment operations after 9/11. Trevor Aaronson, author of The Terror Factory: Inside the FBI’s Manufactured War on Terrorism, estimated that only about 1% of the 500 people charged with international terrorism offenses in the decade after 9/11 were bona fide threats. Thirty times as many were induced by the FBI to behave in ways that prompted their arrest. The bureau’s informant program extends far beyond Muslims.

     

    It bankrolled an extremist right-wing New Jersey blogger and radio host for five years before his 2009 arrest for threatening federal judges.

     

    And then there are the other scandals — the perpetual false testimony from the FBI crime lab, its use of National Security Letters and other surveillance tools to illegally vacuum up Americans’ personal info, its whitewashing of every shooting by an FBI agent between 1993 and 2011, and its operation of dozens of child porn websites (another entrapment operation gone awry).

    But don't worry, the FBI still has plenty of time to spy on ordinary peaceful Americans and antagonize them. Bovard continues:

    From 1956 through 1971, the FBI’s COINTELPRO (counterintelligence programs) conducted thousands of covert operations to incite street warfare between violent groups, to get people fired, to smear innocent people by portraying them as government informants, and to cripple or destroy left-wing, black, communist, white racist and anti-war organizations. FBI agents also busied themselves forging "poison pen" letters to wreck activists’ marriages. COINTELPRO was exposed only after a handful of activists burglarized an FBI office in a Philadelphia suburb, seized FBI files, and leaked the damning documents to journalists.

    But, the FBI's defenders will surely tell you that every penny of that 8.7 billion is there to keep you "safe." This naive position relies on the decades-old mythology behind a government agency that has long been, as Bovard has called it, a "stasi for America." Last year, I noted

    Of all federal police forces, the FBI is the most romanticized, and every FBI agent is assumed to be the modern embodiment of a fictionalized version of Eliot Ness: incorruptible, professional, and efficient. Decades of pop culture has driven this home with TV series and movies such as The UntouchablesThe FBI Story, and This Is Your FBI have long perpetuated the idea that when local police fail, the FBI will step in to be more effective and simply better than every other law enforcement agency. Corruption cannot touch the FBI, we are told, and they apply the law equally to everyone. 

    This mythology was necessary to overcome decades-long opposition to a federal police force which was long properly viewed an an unconstitutional usurpation of state and local prerogatives. 

    We Don't Need Vast Government Agencies for Quality Policing

    The advocates for national police also often claim that without a national police force, the individual states of the US would be overrun by criminals. The US states are too small and weak, we are told, to mount any effective opposition to sophisticated crime operations. 

    So, by this reasoning, small countries should have more criminal activity than larger, more powerful countries. 

    But where's the evidence for this? Is Switzerland crime infested while much-larger Mexico is crime free? Nope. Does Poland have sky-high homicide rates while much-more-powerful Russia is serenely peaceful? Wrong again. Indeed, no relationship whatsoever has been demonstrated between the size and scope of a country's regime, and the amount of crime it has. Brazil, after all, is an immense state both in geography and in regulatory vigor. Yet crime there is a major problem. 

    Moreover, even if there were some optimum minimum size for countries (which there is not) many US states have more than enough wealth, population, and power to fund immense police operations. 

    Texas, for instance, has approximately the same GDP and population size as Australia. If Australia is not ruled by drug runners and terrorists — as we're supposed to believe would happen to Texas without the FBI — why is Texas too small to obtain the same level and quality of law enforcement? With more than 20 million inhabitants, Florida and New York have GDPs similar to those of a mid-sized European country. Pennsylvania has a GDP equal to that of Switzerland. California has both a population and a GDP larger than that of Canada. 

    Moreover, without the FBI not even very small US states would be on their own since no FBI is necessary to coordinate information-sharing between states. INTERPOL, of course, has been around for decades as a body that helps police organizations share information and apprehend suspects. INTERPOL itself, however, has no agents who make arrests, and INTERPOL's budget is much, much smaller than that of the FBI.

    Not even the European Union has gone so far as to create a police force that resembles the FBI in its vast power. Europol, like INTERPOL, assists in coordination among police agencies, but Europol officers do not conduct independent investigations in member countries as the FBI does in American states. Europol's budget is only a small fraction of the FBI's. 

    So why is the FBI necessary? If you're a DC politician, the FBI may be quite useful in terms of settling scores, finding cushy jobs for your friends, and for living out one's control-freak fantasies as appears to be the case with Jeff Sessions' revived drug war. 

    For ordinary Americans, though, the FBI doesn't do anything that smaller and more responsive governments can't do on their own.

  • 'The Everything Bubble': Why The Coming Collapse Will Be Even Worse Than The Last

    The next crash is coming, and the decision by central banks to paper over their economy's troubles with a massive injection of debt likely means that the next crash is already overdue.

    Soon, investors will be forced to reconcile a massive expansion of debt and falling productivity and growth with a host of potentially disruptive crises: The advent of government-sponsored cyberwarfare, followed by the collapse of the global dollar-based monetary system. Whereas the last crisis trigger massive devaluations in the real estate and stock markets, the next crash will be the result of a triple bubble in stocks, real estate and bonds as investors bail out of traditional assets in favor of the safety of gold, silver and – perhaps – cryptocurrencies like bitcoin.

    Gold analyst Mike Maloney believes that traditional assets will plunge, and gold, silver and cryptocurrencies like bitcoin will outperform, as investors seek protection from the coming collapse of the global dollar system. Maloney explains his thinking in a new YouTube video "The Everything Bubble."

    In the U.S., housing prices have experienced a halting recovery since the subprime crisis. But in other markets, like New Zealand, Canada, a frenzy of buying by wealthy Chinese hoping to stash their money abroad kept prices afloat, driving the ratio of home prices to incomes to all time highs. In Canada, the affordability index – the ratio of housing prices to incomes – has risen to an all-time high of 1.4.

     

    In the stock market, a few vulnerabilities have emerged; the ratio of debt borrowed against investors' brokerage account balances has reached all-time highs, which tells you that recent gains are vulnerable to a short-squeeze – which is when brokerages close clients out of their positions.

    Worth noting: the rise in margin debt has traced the run-up in the S&P 500.

    The VIX – a gauge of expected volatility – has fallen to multi-decade lows, suggesting that markets have grown complacent in the face of the coming crash. Earnings-per-share ratios are looking precariously stretched to dot-com-era levels.

    And, finally, a look at intraday trading patterns also reveals signs of strain: Maloney, borrowing from the research of John Hussman of Hussman Funds, the former University of Michigan finance professor who famously predicted the 2008 crisis, explains that lately he's seen what he calls "exhaustion gaps" appearing with increasing frequency. Hussman defines an "exhaustion gap" as any time the S&P 500 opens 0.5% above its previous close while its within 2% of its all-time high. These gaps show that the supply of capital pouring into the market is thinning, or " that there are no more suckers willing to buy at the top."

    Bonds have been in a "perfect bull market" for 36 years, Maloney says. But historical patters suggest that the coming shock will likely trigger its demise: Over a span of decades, interest rates have tended to spend about equal time on either side of a peak. If this pattern holds, it would mean that the decadeslong bond-market rally only has two or three years left to run, which brings us to another important question: when the crash comes, what's it going to look like?

    Maloney believes it will unfold in two stages:

    In the first, investors will flood into the perceived safety of bond markets, causing a temporary spike, as stocks and real estate markets collapse.

     

    Then all three markets will plummet as the collapse of a catastrophic pile of debt brings about the end of the global dollar-based monetary system.

    In the 20th Century, shifts in the global monetary paradigm have occurred about every 30-50 years.

    And shifts in secular bond-market trends have tended to mirror them. Maloney, who has long advocated owning gold and silver, also revealed that he has purchased a small share of bitcoin and other cryptocurrencies, though he cautions against owning an outside position. Rising demand in the East has been offsetting falling demand in the U.S. So far, excess capacity in the U.S. market has helped compensate for this as the East has attracted Western gold.

    But soon this imbalance will be ameliorated, and the price of gold – which has already risen modestly year-to-date – will see a large, sustained rise.

  • Trump Responds To Appointment Of Special Counsel

    President Trump has just issued the following statement in response to the news that former FBI Director Robert Mueller has been appointed as Special Counsel in an investigation looking into his campaign’s alleged collusion with Russia intended to throw the 2016 campaign.  Taken at face value, it seems to confirm what the administration has said several times, namely that, like many of us, the White House is eager to proceed with, and conclude, an investigation as quickly as possible. 

    “As I have stated many times, a thorough investigation will confirm what we already know – there was no collusion between my campaign and any foreign entity.  I look forward to this matter concluding quickly.  In the meantime, I will never stop fighting for the people and the issue that matter most to the future of our country.”

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    Per our earlier post, in an effort to avoid any conflicts, the Department of Justice has confirmed that the White House was only informed of Acting Attorney General Rosenstein’s decision to appoint a Special Counsel in the Russia probe after the order was already signed.

    Of course, we’re all waiting with bated breath to see whether Trump will offer any other, less-scripted thoughts via Twitter.

    Courtesy of Bloomberg’s Jennifer Jacobs, here is a full breakdown of today’s sequence of events:

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  • Trump Safe? McCain Rejects Call To Impeach Trump

    And just like that, Trump may have avoided near certain political doom.

    As news was breaking that the DOJ had named a Special Counsel for the Russia probe, a move that will substantially ease political tensions on the Hill (and is a move which the administration would almost certainly not have allowed if it had anything material to hide), another major hurdle for Trump dissolved this afternoon, when one of the biggest “risk-factors” behind a potential Trump impeachment was removed.

    Recall that in its initial analysis of the biggest risk factor facing Trump, Height Securities’ Peter Cohn said to keep a close eye on just one republican: John McCain.

    Cutting to the chase, Cohn writes that ending Trump’s viability as president “depends on Republicans turning against him”, as impeachment proceedings can only begin with the majority party, and the 25th Amendment (allowing for president’s removal when unable to discharge powers/duties of his office) can only be invoked by Congress and/or vice president, majority of Cabinet.

     

    What will Height be closely watching to see if the Trump drama enters a potentially terminal phase: the main catalyst is whether Sen. John McCain, chairman of Armed Services Committee, begins calling for Trump’s resignation, as U.S. national security issues may increase concern among Republican voters.

    And while earlier today, one GOP Rep. Justin Amash already suggested that if the FBI memo story is true, impeachment would be appropriate, in the clearest sign yet that Trump may be safe after all, the Washington Examiner reported that John McCain said that calls from congressional Democrats to impeach President Trump are not “rational” adding that “I don’t think very many people take that very seriously,” he said Wednesday.

    “All I can do is judge the situation as it is. Every day, we are surprised by some other twist and turn of this issue so I can only respond now and now I do not think that is a rational approach.”

    Earlier in the day, Democratic representative Al Green called for Trump’s impeachment on the House floor Wednesday, accusing the president of obstruction of justice.

    “I rise today, Mr. Speaker, to call for the impeachment of the President of the United States of America for obstruction of justice,” he said. “There is a belief in this country that no one is above the law. And that includes the President of the United States of America.”

    While Democrats urging Trump’s impeachment had new energy following a bombshell report about Trump on Tuesday, ultimately it was all up to getting Republicans behind the push, and it was in this context that JPM said “a Trump impeachment was very, very unlikely.”

    Trump – impeachment very, very unlikely and regardless it wouldn’t be positive. There is a lot of talk about Trump impeachment and how a President Pence could be a positive. It is way, way too early to begin having the impeachment conversation. Impeachment is much more a political (instead of a legal) process and w/the GOP controlling both chambers and Trump’s popularity in the party being (relatively) healthy the political dynamics don’t signal impeachment. That could change in Jan ’19 assuming Republicans lose either the House or Senate in Nov ’18 but if that happens the whole pro-growth agenda would grind to a halt. The impeachment bar is very, very high (no president ever has been removed from office as a result of impeachment; two had articles of impeachment brought up in the House before being acquitted in the Senate; one resigned before going through the process). The daily scandals obviously don’t help Trump’s political capital but market expectations for legislative action are already very low.

    JPM said this before McCain had made his position clear. Now that the Arizona Senator has also voiced his support of Trump (we ignore Putin’s offer to present a transcript of the conversation with Lavrov, exonerating Trump) any likelihood of a Trump impeachment, absent some stunning finding by the Special Counsel, is materially lower (if not gone altogether), for the foreseeable future.

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  • Turkish-American Relations At Crossroads

    Authored by M.K.Bhadrakumar via The Strategic Culture Foundation,

    When President Donald Trump received President Recep Erdogan on Tuesday at the White House, his legendary deal-making prowess was be on trial.

    Trump has not been in a tearing hurry to receive Erdogan. During the first 100 days of his presidency, Trump received the leaders of Israel, Egypt, Saudi Arabia, UAE, Jordan (twice), Iraq and Palestine. Yet, none of them belongs to a Nato member country and or is a crucial “swing” state in Trump’s messianic war against ISIS, as Turkey is.

    Could it be Erdogan’s dalliance with ISIS in the past that put a dampened Trump’s enthusiasm for this “strongman”? But then, Saudi Arabia too was promoting al-Qaeda groups in Syria.

    Or, was it Erdogan’s growing friendship with Russian President Vladimir Putin that discouraged Trump? But then, Trump greeted Egypt’s President Abdel Fattah el-Sisi in the White House as an old ally.

    Clearly, the only good reason could be that Trump deliberately decided that there is a time for everything – even for meeting Erdogan. Trump thoughtfully let the Turkish referendum on constitutional reform run its course first. Trump now has the answer.

    Erdogan extracted a “yes” vote in the referendum alright, and is set to concentrate executive power in his hands, but, paradoxically, he is a wounded man, having lost the referendum vote in all major cities, especially Istanbul, which has been his citadel. Erdogan barely scraped through.

    On the other hand, an invigorated German-French axis following the resounding election victory of Emmanuel Macron means that a consolidated EU pressure is building on Erdogan to curb his authoritarian drift. Erdogan knows that a rupture of Turkey’s ties to the West would have grave economic and political consequences.

    Meanwhile, if Erdogan had calculated that he could play off the US and Russia, that is also not to be. Trump simply outflanked him by opening a line to Putin regarding Syria before he met Erdogan.

    Erdogan has been naïve. The Kremlin won’t risk annoying Trump. Détente with the US is an overriding concern for Russia.

    All things taken into account, therefore, Trump did the right thing to meet Erdogan in the fullness of time. Trump’s decision to sign the executive order allowing the Pentagon to transfer heavy weapons to the Kurdish militia on the eve of Erdogan’s visit underscores it.

    Trump is looking for a quick victory in Raqqa. The liberation of Raqqa will be prime time news in America. Who’d pay attention anymore to “a showboat” such as James Comey when the pictures are beamed from Raqqa into the living rooms of America?

    The Pentagon commanders estimate that the Kurdish militia with US air support will liberate Raqqa successfully and swiftly. Indeed, latest reports suggest that the Kurdish militia has reached within two kilometers of Raqqa city limits.

    Simply put, Erdogan who was hoping to dissuade Trump from aligning with the Kurds will now have to discuss concerns over post-liberation Raqqa. The ground beneath Erdogan’s feet has dramatically shifted.

    He still can resort to strategic defiance by resorting to air strikes against the Kurdish militia, similar to the attacks staged by the Turkish air force on April 25 on the town of Sinjar (Iraqi Kurdistan) and on targets in the Karachok Mountains (northeastern Syria).

    However, the US and Russian deployments to the Kurdish cantons in northern Syrian show that both Washington and Moscow have factored in such a possibility and have a tacit understanding that only their physical presence might act as a deterrent against Erdogan’s adventurism.

    This opens up a tantalizing prospect – US and Russia having an unwritten division of labor to “tame” Erdogan. The Russian diplomacy has shown masterly skill in shepherding Turkish policies away from covert backing for extremist groups toward new directions that help to end the fighting in Syria. The Russia-US cooperation in Syria drastically curbs Erdogan’s elbow room.

    What are Erdogan’s options? Trump has put him out of business since the US is no longer using Turkish proxies to push the “regime change” agenda in Syria. American retrenchment affects Saudi and Qatari policies, too.

    Besides, Erdogan will be wary of provoking Trump. Apart from the discord over the extradition of Islamist preacher Fetullah Gulen, the US is keeping under detention the top executive of Halkbank Mehmet Hakan Attila whom it implicates in the sensational criminal case (which is also linked to Erdogan’s immediate family members) regarding abuse of the US financial system to conduct fraudulent transactions on behalf of Iranian entities.

    Will Erdogan retaliate by shutting down Incirlik air base? Such a possibility exists, but remains unlikely. At any rate, Washington is focused on the liberation of Raqqa, and access to Incirlik is a secondary issue at the moment.

    The bottom line is that Erdogan is running out of options and may be coming under pressure, finally, to (re)open his own channels to the Kurdish groups. Indeed, Turkey got along well with the leadership of Iraqi Kurdistan and a similar deal can be worked out with Syrian Kurds.

    Being the consummate pragmatist that he is, Erdogan may well decide to pick up the threads of the peace process with the Kurds from where he summarily left them in 2015 due to compulsions over forthcoming electoral battles culminating in the March referendum to transform Turkey into a presidential system.

    Significantly, Erdogan has reacted with extraordinary restraint to the Pentagon move to arm Kurds in Syria. He is mulling over his options. Trump can encourage him to seek a deal with Kurds. It may not be the mother of all deals, but a historic deal nonetheless, which will go a long way to stabilizing Syria and the wider Middle East.

  • Retired Green Beret Warns A Successful Derailment Of Trump's Efforts Is Well Under Way; War Is Inevitable

    Authored by Jeremiah Johnson, nom de plume of a retired Green Beret of the United States Army Special Forces, via SHTFplan.com,

    In previous articles, I mentioned the importance of the midterm elections, and how (to run the country effectively and to be reelected) the President needs success within his first six months in office.  Although he is more than willing to make changes and has demonstrated his good intentions, the battle with the ensconced Marxists labeling themselves as either “progressives” or “centrists” is being lost.  Why is it being lost?  It is because these prior Obama appointees in the Circuit courts and the Supreme Court, along with the innumerable holdovers within the administration’s machinery effectively amount to a “fifth column,” bent on sabotaging the President’s efforts.

    The successful derailment is well under way.  As I wrote in other articles, all that is needed for the Democrats to take the Senate and the House of Representatives in the upcoming Midterm elections is for the President to not make visible and productive changes within the first six months of his term.  The stultified public will perceive it as a failure, and with the RINO (Republicans In Name Only) Republican party to help with a “shove” here and there, the President will fall right into the pool.

    The planned border fence will not be built, the repeal of Obamacare will not take place, the flood of illegals will neither be stopped or reversed, and financial measures to stimulate the domestic economy are being implemented at glacial speed.  All the President’s executive orders are being struck down by the Obama-appointed judges in the courts.  There is not much time remaining before the Midterm congressional elections. We are a year out, and even before the campaigning has begun, it appears it will be up for grabs.

    Obamacare is the best example of what has been outlined.  Aetna recently bowed out and pulled out of the machinery as far as private insurance companies run.  They stated that the arena was “untenable” and that the firm could no longer underwrite with the budgetary shortfalls and the nebulosity that lacked a demarcation of where government responsibility was to pick up what the company did not underwrite.  From an economic perspective, everyone with a brain knew that Obamacare would not function properly and would be a financial and administrative disaster.

    That is why Obamacare is a success: it was meant to collapse the system and the insurance companies, forcing into existence a single-payer system and a government “exchange” that intruded on the lives of every citizen…pure “Cloward and Piven” at its finest.

    The Republican Party is responsible for the continuance of Obamacare.  Nobody is focusing upon this fact.  Right now, everyone is focused upon Comey and a potential tie-in with Flynn and any connection to Russia regarding pre-election campaign communiques between then-candidate Donald Trump and the Russian leadership.  Obamacare is all but forgotten.

    With the Republicans in control of both the Senate and the House of Representatives, at this point, the bill to repeal Obamacare should have already passed both houses of Congress and been on the President’s desk to sign: this was not done, and the Republican Party is to blame.

    If the President is unable to make a change while he has both houses of Congress under Republican control, what will happen after the Midterm election changes the complexion of Congress and makes it Democrat?  How will he be reelected, and if so, to what end?  He waited too long to fire Comey…a name that will torment us in the news even more than that of Natalie Holloway…and now it is turning around to bite him.  What is the solution?

    War.  War is the means an administration uses to sway public opinion and garner the Congress and the other nabobs into lockstep under the guise/choice of “you’re either patriotic or unpatriotic,” forced upon all of them in the court of public opinion and on the media’s stage.  War is supported by the Congress, who is bought by the MIC (Military Industrial Complex) and the oligarchy and their army of lobbyists.

    The administration is not accomplishing anything effectively, but a war can “rescue” it from its difficulties and divert the public’s attention.  There are several theaters that can easily metastasize into a full-blown conflict and then draw in other nations for an all-out war.  To catalyze such actions would be a simple feat for any administration with the resources of the United States backing it.  The question remains to be answered whether the administration will take such a step to save itself.

    History proves out a high probability that an administration will do such

    Carter with Desert One (the failed Iranian hostage rescue attempt),

     

    Reagan with Grenada,

     

    Margaret Thatcher of Great Britain with the Falkland Islands,

     

    Bush Sr. with Iraq (I),

     

    Clinton with the bombing of Serbia and the war in Bosnia,

     

    and Bush Jr. with Iraq (II). 

    Will this administration take similar measures in any of the “powder keg” theaters of Ukraine, North Korea, or Syria?  The question remains to be answered, and the probability is high that the answer will be “yes.”

  • Professor Cohen Says Assault on Trump Presidency is Our Greatest National Security Threat: Is There A 4th Branch of Government?

    Steven Cohen, Professor of Russian studies at Princeton and NYU (an obvious Russian spy) was besides himself tonight, in sheer disbelief over the with hunt of gigantic nothing-burgers that are being used to assault the Presidency of Donald Trump.

    He declared, “today, I would say (the greatest threat to national security) is this assault on President Trump. Let’s be clear what he’s being accused of is treason. This has never happened in America, that we had a Russian agent in the White House. Cohen believes Flynn did nothing wrong by talking to the Russian ambassador, describing it as ‘his job’ to do so.

    He then illuminated the indelible fact that there is a 4th branch of government, the intelligence community, who have been meddling in American foreign affairs, obstructing the other 3 branches of government.

    “In 2016, President Obama worked out a deal with Russian President Putin for military cooperation in Syria. He said he was gonna share intelligence with Russia, just like Trump and the Russians were supposed to do the other day. Our department of defense said it wouldn’t share intelligence. And a few days later, they killed Syrian soldiers, violating the agreement, and that was the end of that. So, we can ask, who is making our foreign policy in Washington today?”

    Professor Cohen added, “you and I have to ask a subversive question, are there really three branches of government, or is there a 4th branch of government? These intel services. What we know, as a fact, is that Obama tried, not very hard but he tried for a military alliance with Putin, in Syria, against terrorism and it was sabotaged by the department of defense and its allies in the intelligence services.”

    Watch.

    Content originally published at iBankCoin.com

  • Why Was Comey Fired?

    Last week, President Trump justified his decision to fire James Comey by citing a letter from Deputy Attorney General Rod Rosenstein accusing Comey of serious mistakes in the investigation into Hillary Clinton’s private email server. However, as Statista’s Niall McCarthy details, according to a new Reuters/Ipsos poll, however, Americans largely disagree with that rationale.

    Infographic: Why Was Comey Fired?  | Statista

    You will find more statistics at Statista

    Only 15 percent of the U.S. public think Trump fired Comey due to his unhappiness with the email server investigation compared to 34 percent who think he acted due to Comey’s investigation into his administration’s ties with Russia.

    The largest share of Americans, 36 percent, blame the Comey firing on a combination of reasons.

  • America's Reign Of Terror: A Nation Reaps What It Sows

    Authored by John Whitehead via The Rutherford Institute,

    “The means of defense against foreign danger have been always the instruments of tyranny at home.” ? James Madison

    Who designed the malware worm that is now wreaking havoc on tens of thousands of computers internationally by hackers demanding a king’s ransom? The U.S. government.

    Who is the biggest black market buyer and stockpiler of cyberweapons (weaponized malware that can be used to hack into computer systems, spy on citizens, and destabilize vast computer networks)? The U.S. government.

    What country has one the deadliest arsenals of weapons of mass destruction? The U.S. government.

    Who is the largest weapons manufacturer and exporter in the world, such that they are literally arming the world? The U.S. government.

    Which is the only country to ever use a nuclear weapon in wartime? The United States.

    How did Saddam Hussein build Iraq’s massive arsenal of tanks, planes, missiles, and chemical weapons during the 1980s? With help from the U.S. government.

    Who gave Osama bin Laden and al-Qaida “access to a fortune in covert funding and top-level combat weaponry”? The U.S. government.

    What country has a pattern and practice of entrapment that involves targeting vulnerable individuals, feeding them with the propaganda, know-how and weapons intended to turn them into terrorists, and then arresting them as part of an elaborately orchestrated counterterrorism sting? The U.S. government.

    Where did ISIS get many of their deadliest weapons, including assault rifles and tanks to anti-missile defenses? The U.S. government.

    Which country has a history of secretly testing out dangerous weapons and technologies on its own citizens? The U.S. government.

    Are you getting the picture yet?

    The U.S. government isn’t protecting us from terrorism.

    The U.S. government is creating the terror. It is, in fact, the source of the terror.

    Just think about it for a minute: almost every tyranny being perpetrated against the citizenry—purportedly to keep us safe and the nation secure—has come about as a result of some threat manufactured in one way or another by our own government.

    Cyberwarfare. Terrorism.

    Bio-chemical attacks. The nuclear arms race.

    Surveillance. The drug wars.

    In almost every instance, the U.S. government has in its typical Machiavellian fashion sown the seeds of terror domestically and internationally in order to expand its own totalitarian powers.

    It’s time to wake up and stop being deceived by government propaganda.

    We’re not dealing with a government that exists to serve its people, protect their liberties and ensure their happiness. Rather, these are the diabolical machinations of a make-works program carried out on an epic scale whose only purpose is to keep the powers-that-be permanently (and profitably) employed.

    Case in point: For years now, the U.S. government has been creating what one intelligence insider referred to as a cyber-army capable of offensive attacks.

    As Reuters reported back in 2013:

    Even as the U.S. government confronts rival powers over widespread Internet espionage, it has become the biggest buyer in a burgeoning gray market where hackers and security firms sell tools for breaking into computers. The strategy is spurring concern in the technology industry and intelligence community that Washington is in effect encouraging hacking and failing to disclose to software companies and customers the vulnerabilities exploited by the purchased hacks. That's because U.S. intelligence and military agencies aren't buying the tools primarily to fend off attacks. Rather, they are using the tools to infiltrate computer networks overseas, leaving behind spy programs and cyber-weapons that can disrupt data or damage systems.

    As part of this cyberweapons programs, government agencies such as the NSA have been stockpiling all kinds of nasty malware, viruses and hacking tools that can “steal financial account passwords, turn an iPhone into a listening device, or, in the case of Stuxnet, sabotage a nuclear facility.”

    And now we learn that the NSA is responsible for the latest threat posed by the “WannaCry” or “Wanna Decryptor” malware worm which—as a result of hackers accessing the government’s arsenal—has hijacked more than 57,000 computers and crippled health care, communications infrastructure, logistics, and government entities in more than 70 countries already.

    All the while the government was repeatedly warned about the dangers of using criminal tactics to wage its own cyberwars.

    It was warned about the consequences of blowback should its cyberweapons get into the wrong hands.

    The government chose to ignore the warnings.

    That’s exactly how the 9/11 attacks unfolded.

    First, the government helped to create the menace that was al-Qaida and then, when bin Laden had left the nation reeling in shock (despite countless warnings that fell on tone-deaf ears), it demanded—and was given—immense new powers in the form of the USA Patriot Act in order to fight the very danger it had created.

    This has become the shadow government’s modus operandi regardless of which party controls the White House: the government creates a menace—knowing full well the ramifications such a danger might pose to the public—then without ever owning up to the part it played in unleashing that particular menace on an unsuspecting populace, it demands additional powers in order to protect “we the people” from the threat.

    Yet the powers-that-be don’t really want us to feel safe.

    They want us cowering and afraid and willing to relinquish every last one of our freedoms in exchange for their phantom promises of security.

    As a result, it’s the American people who pay the price for the government’s insatiable greed and quest for power.

    We’re the ones to suffer the blowback.

    Blowback: a term originating from within the American Intelligence community, denoting the unintended consequences, unwanted side-effects, or suffered repercussions of a covert operation that fall back on those responsible for the aforementioned operations.

    As historian Chalmers Johnson explains, “blowback is another way of saying that a nation reaps what it sows.”

    Unfortunately, “we the people” are the ones who keep reaping what the government sows.

    We’re the ones who suffer every time, directly and indirectly, from the blowback.

    We’re made to pay trillions of dollars in blood money to a military industrial complex that kills without conscience. We’ve been saddled with a crumbling infrastructure, impoverished cities and a faltering economy while our tax dollars are squandered on lavish military installations and used to prop up foreign economies. We’ve been stripped of our freedoms. We’re treated like suspects and enemy combatants. We’re spied on by government agents: our communications read, our movements tracked, our faces mapped, our biometrics entered into a government database. We’re terrorized by militarized police who roam our communities and SWAT teams that break into our homes. We’re subjected to invasive patdowns in airports, roadside strip searches and cavity probes, forced blood draws.

    This is how tyranny rises and freedom falls.

    We can persuade ourselves that life is still good, that America is still beautiful, and that “we the people” are still free.

    However, as I make clear in my book Battlefield America: The War on the American People, the moment you tune out the carefully constructed distractions—the year-round sports entertainment, the political theatrics, the military’s war cries, the president’s chest-thumping, and the techno-gadgets and social media that keep us oblivious to what’s really going on in the world around us—you quickly find that the only credible threat to our safety and national security is in fact the government itself.

    As science fiction writer Philip K. Dick warned, “Don’t believe what you see; it’s an enthralling—[and] destructive, evil snare. Under it is a totally different world, even placed differently along the linear axis.”

    In other words, all is not as it seems.

    The powers-that-be are not acting in our best interests.

    “We the people” are not free.

    The government is not our friend.

    And America will never be safe or secure as long as our government continues to pillage and plunder and bomb and bulldoze and kill and create instability and fund insurgencies and police the globe.

    So what can we do to stop the blowback, liberate the country from the iron-clad grip of the military industrial complex, and get back to a point where freedom actually means something?

    For starters, get your priorities in order. As long as Americans are more inclined to be offended over the fate of a Confederate statue rather than the government’s blatant disregard for the Constitution and human rights, then the status quo will remain.

    Stop playing politics with your principles. As long as Americans persist in thinking like Republicans and Democrats—refusing to recognize that every administration in recent years has embraced and advanced the government’s authoritarian tactics—then the status quo will remain.

    Value all human life as worthy of protection. As long as Americans, including those who claim to value the sanctity of human life, not only turn a blind eye to the government’s indiscriminate killings of innocent civilians but champion them, then the status quo will remain.

    Recognize that in the eyes of the government, we’re all expendable. As long as we allow the government to play this dangerous game in which “we the people” are little more than pawns to be used, abused, easily manipulated and just as easily discarded—whether it’s under the guise of national security, the war on terror, the war on drugs, or any other manufactured bogeyman it can dream up—then the status quo will remain.

    Demand that the government stop creating, stockpiling and deploying weapons of mass destruction: nuclear, chemical, biological, cyber, etc. As long as the government continues to use our tax dollars to create, stockpile and deploy weapons of mass destruction—whether those weapons are meant to kill, maim or disable (as in the case of the WannaCry computer virus)—we will be vulnerable to anyone who attempts to use those weapons against us and the status quo will remain.

    Finally, stop supporting the war machine and, as Chalmers Johnson suggests, “bring our rampant militarism under control”:

    From George Washington’s “farewell address” to Dwight Eisenhower’s invention of the phrase “military-industrial complex,” American leaders have warned about the dangers of a bloated, permanent, expensive military establishment that has lost its relationship to the country because service in it is no longer an obligation of citizenship. Our military operates the biggest arms sales operation on earth; it rapes girls, women and schoolchildren in Okinawa; it cuts ski-lift cables in Italy, killing twenty vacationers, and dismisses what its insubordinate pilots have done as a “training accident”; it allows its nuclear attack submarines to be used for joy rides for wealthy civilian supporters and then covers up the negligence that caused the sinking of a Japanese high school training ship; it propagandizes the nation with Hollywood films glorifying military service (Pearl Harbor); and it manipulates the political process to get more carrier task forces, antimissile missiles, nuclear weapons, stealth bombers and other expensive gadgets for which we have no conceivable use. Two of the most influential federal institutions are not in Washington but on the south side of the Potomac River–the Defense Department and the Central Intelligence Agency. Given their influence today, one must conclude that the government outlined in the Constitution of 1787 no longer bears much relationship to the government that actually rules from Washington. Until that is corrected, we should probably stop talking about “democracy” and “human rights.”

  • 48% Of Americans Want To Impeach Trump

    Update: We can only imagine what the poll says after tonight's debacle from The New York Times.

    *  *  *

    According to a new survey by the Democratic polling firm Public Policy Polling (PPP), 48% of Americans want Trump impeached.  Of course, while it makes for a provocative headline, the poll does little more than prove that (i) pollsters are still using generous Democrat "oversamples" and (ii) Trump's favorability is heavily dependent on ones party affiliation with 81% of Hillary voters supporting impeachment and 83% of Trump voters opposing it.

    And while 81% of Hillary voters can't wait for impeachment proceedings, we can't help but wonder whether any of them could point to a single "fact", as opposed to an anonymously sourced fake news story from the New York Times and/or Washington Post, that would merit such a punishment. 

    As far as we know, the only thing that Democrats have managed to "prove" so far is that a couple of Russian-based media outlets ran some negative articles about Hillary during the 2016 election cycle…which pales in comparison to the amount of negative press that Republicans get from the combination of CNN, NYT, Wapo and the rest during every single election cycle…does this mean that CNN has tried to hack every election for the past 35 years?

    And, just as a matter of housekeeping because it's pretty much taken as a given at this point, here is proof of PPP's 9-point Democrat oversample.

     

    That said, all of Trump's latest controversies, starting with Comey's firing last week and culminating with Wapo's latest 'bombshell' that he shared "highly classified intelligence" with the Russian ambassador in the Oval Office, seem to be taking a toll on his overall public perception and increasing the market odds of his impeachment.

    Impeach

     

    And further still since The New York Times reported the Comey Memo..

     

    In other news, the PPP poll found that ~90% of Hillary voters 'disapprove' of Trump…shocking, we know.

     

    Moreover, nearly 90% of Hillary voters do not think the Russian story is 'fake news'.

     

    Anyone else noticing a trend here?  We're almost certain that Trump could announce that he'd found a cure for cancer and 90% of Hillary voters would be opposed to using it.

    Finally, the only issue where Hillary voters seemed to be somewhat confused was whether or not they support former FBI director James Comey…on Comey's favorability Hillary voters were roughly equally split between 'favorable', 'unfavorable' and 'we have no freaking clue how to respond because we're not sure which answer means that we hate Trump more.'

     

    But, while Hillary voters have no idea how they should feel about Comey, once again ~90% are certain that Trump shouldn't have fired him….Hillary maybe…but definitely not Trump.

  • Oregon Officials Threaten To Seize 2,000 Acre Organic Farm, Spray It With Roundup

    Authored by Mike Shedlock via MishTalk.com,

    Sherman County Oregon believes the 2,000 acre Azure Farms is not doing enough to control Canada Thistle, a noxious weed. In this case, not doing enough means not spraying weeds with herbicides.

    To remedy the alleged problem, the county proposes seizing the farm and spraying everything with Roundup and other herbicides. Azure Farms is certified organic. Of course, organic farms cannot by definition use herbicides, so the farm would be forced out of business by the county government.

    Adding insult to injury, the county would place a lien on the property forcing it to pay for the herbicides.

    Details of the proposed takeover can be found at Keep Azure Farm Organic

    An Organic Farm Under Threat

    Azure Farms is a working, Certified Organic farm located in Moro, Central Oregon, in Sherman County. It has been Certified Organic for about 18 years. The farm produces almost all the organic wheat, field peas, barley, Einkorn, and beef for Azure Standard.

     

    Sherman County is changing the interpretation of its statutory code from controlling noxious weeds to eradicating noxious weeds. These weeds include Morning Glory, Canada Thistle, and Whitetop, all of which have been on the farm for many years, but that only toxic chemicals will eradicate.

     

    Organic farming methods – at least as far as we know today – can only control noxious weeds—it is very difficult to eradicate them.

     

    What’s Happening?

    Sherman County may be issuing a Court Order on May 22, 2017, to quarantine Azure Farms and possibly to spray the whole farm with poisonous herbicides, contaminating them with Milestone, Escort and Roundup herbicides.

     

    This will destroy all the efforts Azure Farms has made for years to produce the very cleanest and healthiest food humanly possible. About 2,000 organic acres would be impacted; that is about 2.8 times the size of the City of London, England, and 1.5 times the size of the city center of Philadelphia that could be sprayed with noxious, toxic, polluting herbicides.

     

    The county would then put a lien on the farm to pay for the expense of the labor and chemicals used.

     

    Take Action Now

    If you are concerned about where your food comes from, enjoy Organic and non-GMO food grown in the United States, and support organic farmers, contact Sherman County Court before May 22, 2017 (and preferably before May 17 when the next court discussion will be held).

     

    Contact info:

    1. Via email at lhernandez@co.sherman.or.us or…
    2. Call Lauren at 541-565-3416.

     

    Raise your voice and speak up for you and your families and communities.

     

    This proposed action is completely unreasonable and would destroy an organic farm and pollute a massive area. If enough voices that benefit from organic produce speak up, the county will understand that there are people that care about their food NOT containing toxic chemicals. And if the supporters of healthy food can have a louder voice than the supporters of toxic chemicals, every politician will listen. PLEASE take action today and share this message. Overwhelm the Sherman County representatives with your voice.

     

    Sincerely,

    Nathan Stelzer
    Azure Farm Manager

    Agricultural Scientist Responds

    Alos consider Will There be Mandatory Herbicide Spraying on Organic Farms in Sherman County, Oregon? by Charles Benbrook, PhD.

    He sent a letter to Lauren Hernandez (email above).

    Dear Ms. Hernandez et al:

     

    I live in Wallowa County. I learned today of the recent, dramatic change in the Sherman County noxious weed control program and the plan to forcibly spray a 2,000-acre organic farm in the county.

     

    Over a long career, I have studied herbicide use and efficacy, public and private weed control efforts, the linkages between herbicide use and the emergence and spread of resistant weeds, and the public health and environmental impacts of herbicide use and other weed management strategies.

     

    I served for six years, along with fellow Oregonian Barry Bushue, past-president of the Oregon Farm Bureau, on the USDA’s AC 21 Agricultural Biotechnology Advisory Committee. Issues arising from herbicide use were a frequent topic of discussion during our Committee’s deliberations.

     

    I have published multiple scientific papers in peer-reviewed journals on glyphosate, its human health risks, and the impact of genetically engineered crops on overall herbicide use and the spread of resistant weeds. In a separate email, I will forward you copies of my published research relevant to the use of herbicides, and glyphosate in particular.

     

    The notion that Sherman County can eradicate noxious weeds by blanket herbicide spraying is deeply misguided. I cannot imagine a single, reputable university weed scientist in the State supporting the idea that an herbicide-based noxious weed eradication program would work (i.e., eradicate the target weeds) in Oregon, or any other state.

     

    There is near-universal agreement in the weed science community nationwide, and surely as well in the PNW, that over-reliance on glyphosate (Roundup) over the last two decades has created multiple, new noxious weeds posing serious economic, environmental, and public health threats.

     

    In fact, over 120 million acres of cultivated cropland in the U.S. is now infested with one or more glyphosate-resistant weed (for details, see http://cehn-healthykids.org/herbicide-use/resistant-weeds/).

     

    The majority of glyphosate-resistant weeds are in the Southeast and Midwest, where routine, year-after-year planting of Roundup Ready crops has led to heavy and continuous selection pressure on weed populations, pressure that over three-to-six years typically leads to the evolution of genetically resistant weed phenotypes, that can then take off, spreading across tens of millions of acres in just a few years.

     

    Ask any farmer in Georgia, or Iowa, or Arkansas whether they would call “noxious” the glyphosate-resistant kochia, Palmer amaranth, Johnson grass, marestail, or any of a dozen other glyphosate-resistant weeds in their fields.

     

    It is virtually certain that an herbicide-based attempt to eradicate noxious weeds in Sherman County would fail. It would also be extremely costly, and would pose hard-to-predict collateral damage on non-target plants from drift, and on human health and the environment. But even worse, it would also, almost certainly, accelerate the emergence and spread of a host of weeds resistant to the herbicides used in the program. …

     

    if Sherman County is serious about weed eradication, it will have to mandate widespread spraying countywide, and not just on organic farms, and not just for one year. The public reaction will be swift, strong, and build in ferocity. It will likely lead to civil actions of the sort that can trigger substantial, unforeseen costs and consequences. I am surely not the only citizen of the State that recalls the tragic events last year in Malheur County.

     

    Plus, I guarantee you that the County, the herbicide applicators, and the manufacturers of the herbicides applied, under force of law on organic or other farms, will face a torrent of litigation seeking compensatory damages for loss of reputation, health risks, and the loss of premium markets and prices.

     

    I have followed litigation of this sort for decades, and have served as an expert witness in several herbicide-related cases. While it is obviously premature to start contemplating the precise legal theories and statutes that will form the crux of future litigation, the County should develop a realistic estimate of the legal costs likely to arise in the wake of this strategy, if acted upon, so that the County Commissioners can alert the public upfront regarding how they will raise the funds needed to deal with the costs of near-inevitable litigation.

     

    If you have any questions, please do not hesitate to call me.

     

    Sincerely,

    Charles Benbrook, PhD

    Troy, Oregon

    Canada Thistles in Sherman County

    Ther above image from Eddmaps.

    Even if someone thought this action would eradicate the weeds, it would have to be applied to the entire county if not the entire state. Then what? The nation?

    Farmer vs Farmer

    I always want to know the other side of the story.

    In this case, the story is farmer vs farmer. Neighboring wheat growers say weeds spreading from Azure Farms threaten their crops.

    Capital Press reports County May Press for Quarantine of an Organic Farm.

    Local wheat farmers say weeds spreading from Azure Farms, on the outskirts of Moro in north central Oregon, cost them money in the form of additional herbicide control. Most critically, growers of certified wheat seed say their crops will be worthless if contaminated by Rush Skeleton Weed, Canada Thistle, Morning Glory and White Top spreading from the farm.

     

    Spraying the weeds with Milestone or other herbicides, however, would cause the farm to lose organic certification for three years. Azure Standard, which operates Azure Farms, is a major distributor of organic products.

     

    Sherman County gave the farm until May 22 to respond with a weed management plan. If not, the county will ask the Oregon Department of Agriculture to quarantine the farm.

     

    The issue has blown up on social media.

     

    The manager of Azure Farms, Nathan Stelzer, urged supporters to “Overwhelm the Sherman County representatives with your voice.” A video posted on the farm website called for people to express their outrage reportedly has resulted in hundreds of phone calls and thousands of emails to county officials.

     

    The issue may come to a head Wednesday when the county’s Board of Commissioners takes up the issue. The county is expecting such a crowd that it moved the session from the courthouse to the Sherman County School gym, 65912 High School Loop, Moro, at 4 p.m.

     

    “The school gym is the only site in Sherman County big enough to hold the expected crowd and we received permission to use the gym only if we delayed our meeting until after the students are dismissed,” Commissioner Tom McCoy said in an email.

     

    Wheat farmer Bryan Cranston, who grows certified seed next to Azure Farms, said its weed problems have gotten progressively worse over the years. Cranston said he spoke to Selzer and told him, “I don’t drift chemicals on you, I’d appreciate it if weeds don’t drift on me.”

     

    Cranston said he told Selzer, “I grow seed wheat to garner more out of the market, you grow organic to garner more out of the market — we have a lot in common here.”

     

    But he added, “You’re messing me up.”

     

    The county warned that it would spray if the farm didn’t, and the cost for multiple surveys throughout the growing season would be billed to the farm as a lien on its property taxes.

     

    Asher said the county could help identify weed, recommend control methods and herbicide products, and had a spray crew for hire if necessary.

     

    David Stelzer said Azure is attempting to improve its ground through crop rotation and “companion planting” of various crops.

     

    “Bio-diversity, a few weeds in the field, does not make a bad farmer,” he said.

     

    Responding to comments he said have been made about the farm, he said it is not affiliated with a religion although they are a “family a faith.” He said Azure properly pays its taxes and provides a $6 million payroll. He said the farm’s wheat yields nearly meet the county average and is of high quality. Eventually, organic farming methods will be “dominant,” he said.

    Both Sides

    That’s both sides of the farming story.

    But there is a medical issue as well. Some patients claim Roundup gave us cancer as EPA official helped the company.

    Questions

    1. Are the increased used of herbicides on neighboring farms caused by Roundup resistant plants or seeds from the organic farm?
    2. Is Azure Farms responsible for blown seeds?
    3. Realistically, how far do these seeds blow? Miles? Thousands of acres?
    4. Is the remedy a lawsuit against Azure Farms by other farmers or action by the County?
    5. Is it possible to create a buffer zone of some sort?
    6. Is Roundup a carcinogen?

    Whether or not you buy and eat organic foods, the proposed action (property seizure)  is extremely controversial, and it likely will not do much about the weeds either.

    Widespread overuse of herbicides (I admit I use them on my lawn and garden), has created Roundup resistant weeds that are near impossible to get rid of.

    Thistle is one weed I have a very difficult time with myself.  Some plants turn brown in a day or two, but thistles stay green for quite a long time even if they wilt and look sick.

    I sprayed thistles four times over the course of a week this year hoping to get rid of them.

    Action

    If you care to voice an opinion, you can do it here: lhernandez@co.sherman.or.us

    I recommend being polite.

    My opinion: Spraying will not work. More importantly, the proposed county action of property seizure steps well over the bounds of reasonableness.

  • New Theory Behind Stalled Economy: Retirees Are Hoarding Too Much Cash

    For years we’ve written about the fact that Americans, young to old, are lousy savers (see “Retirement Crisis Looms As Average U.S. Household Has Saved $2,500 For Retirement“). Of course, they have to be because how else can a mature economy continue to grow unless every single person levers every asset they own to the maximum extent possible and then spends all of that money?  Anything less would mean that all of Janet Yellen’s efforts have been a colossal waste. Meanwhile, this inherent inability to save is awful news for a nation that faces a massive wave of baby boomer retirements over the next 20 years. 

    All that said, we were somewhat shocked to come across a report from money manager United Income which effectively argues that American retirees are saving too much money rather than too little.  To summarize the thesis, United Income argues that retirees become more conservative as they grow older which causes them to save more and allocate less to equities…which is, of course, a somewhat self-serving conclusion but never mind that.

    Innovations in medicine and technology have extended human life by over 30 years since 1900. This has helped to double the amount of time the average adult now spends in retirement compared to several decades ago. But, the benefits of longer lives and retirement may be limited if older households curb their consumption or investment in preventive health measures because they are overly pessimistic about their future financial health. Overly negative viewpoints toward the future may also create self-fulfilling economic problems if it leads to an overly aggressive fixed-income portfolio. To assess these possibilities, we analyze consumer sentiment and spending data from the University of Michigan that was commissioned by the Social Security Administration and U.S. Commerce Department, among other federal agencies.

    The only problem with the theory is that, intentional or otherwise, it’s based on a complete misinterpretation of data.  Per the chart below, United Income referenced the growth in “Mean Net Wealth” as evidence that retirees are hoarding too much cash. 

    Unfortunately, when combined with the fact that “Median Net Wealth” is actually shrinking, it’s easy to deduce that while the majority of American retirees are actually spending their retirement income (and then some), there is a group of super wealthy old folks who simply can’t spend enough money to offset annual investment income growth….which speaks more to the growing wealth gap than to some economic fear that is causing retirees to hoard cash.

     

    In this context, it’s not too difficult to understand why aggregate YoY spending trends collapse as old folks get older.  The most wealthy retirees can only find so many ways to burn their massive nest eggs which means that, at least for these folks, YoY spending doesn’t grow but retirement balances do

     

    …while the overwhelming majority of people simply run out of cash and have to cut every corner possible to survive….

     

    But we’re sure the report from United Income, as misleading as it may be, will undoubtedly convince more retirees to allocate more money to equities…all of which will inflate this ETF-induced equity bubble even more, all while adding to United’s fee income…It’s one of those ‘win-win’ deals.

  • Chaffetz Demands FBI Hand Over All Comey's Notes, Memos, & Recordings Related To Trump

    Update: Jason Chaffetz office just released the letter sent to the FBI’s Andrew McCabe demanding all Comey-Trump related memos…

    Today, the New York Times reported former Federal Bureau of Investigation Director James Comey memorialized the content of phone calls and meetings with the President in a series of internal memoranda. At least one such memorandum reportedly describes a conversation in which the President referenced the FBI investigation of former National Security Advisor Lt. Gen. Michael Flynn and said to Comey, “I hope you can let this go.”

     

    According to the report, “Mr. Comey created similar memos — including some that are classified — about every phone call and meeting he had with the president.” If true, these memoranda raise questions as to whether the President attempted to influence or impede the FBI’s investigation as it relates to Lt. Gen. Flynn. So the Committee can consider that question, and others, provide, no later than May 24, 2017, all memoranda, notes, summaries, and recordings referring or relating to any communications between Comey and the President.

     

    The Committee on Oversight and Government Reform is the principal oversight committee of the House of Representatives and may at “any time” investigate “any matter” as set forth in House Rule X. An attachment to this letter provides additional information about responding to the Committee’s request. Thank you for your attention to this matter.

    Original…

    Trump and/or Comey are getting increasingly boxed in here – one or other is going to be proved a liar soon enough.

    *  *  *

    As we detailed earlier, following the New York Times latest Trump bombshell (see “Comey’s Revenge: Leaks Memo To NYT Saying Trump Asked Him To End Flynn Investigation“), the impeachment word seems to be getting tossed around a little more loosely this evening.  And, given the serious accusations levied by former FBI Director James Comey, the Chairman of the House Oversight Committee, Jason Chaffetz, has  just promised that he will “get the Comey memo, if it exists,” which was backed up by the not so thinly veiled threat: “I have my subpoena pen ready.”

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    Meanwhile, in the following Q&A with NBC, Chaffetz says his committee has already started “drafting the necessary paperwork” to get Comey’s memo to the extent it is not handed over voluntarily.

    “If the memo exists, I need to see it and I need to see it right away.  We are drafting the necessary paperwork to get the mom so we will find out in a hurry if its out there.”

     

    “I want to read the memo first but on the surface that seems like an extraordinary use of influence to try to shutdown an investigation being done by the FBI.  I don’t know if it’s true yet but I want to find out if that’s actually out there.”

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