Today’s News 17th June 2016

Austerity Kills! Bank Of Greece Admits "Greeks' Health Deteriorating, Life Expectancy Shrinks"
Via KeepTalkingGreece.com,

The economic crisis and the strict austerity bound to the Greek bailout agreement kills. They kill Greeks. The Bank of Greece may not write it in such a melodramatic way on its Monetary Policy Report 2015-2016. However, the conclusions in the chapter about “<span title="??? ?????????? ???? ?????? ?? ?????? ???????? ??? ??????? ??? ??????????? ?????? ??? ???????? ??? ??????? ?? ????? “?????????????? ???? ????? ??? ??????, ?????????? ????? ??? ?????????? ???? ????? ??? ?????????¨.

“>Reforms in health, economic crisis and impact on the health of population” are shocking and confirm what we have been hearing and reading around from relatives and friends in the last years: that the physical and mental health of Greeks has been deteriorating – partly due to economic insecurity, high unemployment, job insecurity, income decrease and constant exposure to stress. Partly also due to economic problems that have patients cut their treatment, partly due to the incredible cuts and shortages in the public health system.

The Report notes that “while it takes longer to record the exact effect, trends show a deterioration of the health of Greeks in the years of loan agreements and austerity cuts.”

The BoG states:

– Suicides increased. “The risk of suicidal behavior increases when there are so-called primary risk factors (psychiatric-medical conditions), while the secondary factors (economic situation) and tertiary factors (age, gender) affects the risk of suicide, but only if primary risk factors pre-exist.

– Infant mortality increased by nearly 50%, mainly due to increase of deaths of infants younger than one year, and the decline of births by 22,1%. Infant mortality increase: 2.65% in 2008 and 3.75% in 2014

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“>– Increase of parts of population with mental illness, especially with depression. Increase: 3.,3% in 2008 to 6.8% in 2009, to 8.2% in 2011 and to 12.3% in 2013. In 2014, a 4.7% of the population above 15 years old declared it suffered form depression – that was 2.6% in 2009.

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“>-Increase of chronic diseases increased by approximately 24%.

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“>The BoG notes that “the large cuts in public expenditure have not been accompanied by changes and improvement of the health system in order to limit the consequences for the weakest citizens and vulnerable groups of the society.”

The report of the Governor of the Bank of Greece reckons surveys conducted by Greek Statistic Authorities (ELSTAT) and according to which:
1. a significant increase of 24.2% of people aged 15+ suffering from chronic health problem or chronic disease.
2. increase of more than 15% of people who limited their activities due to health problems in 2014.
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 “>percentage of low-weight (below 2.5 kg) births increased by 19% in 2008-2010, and that this is associated with long-term negative effects on the health and the development of children.
Citing OECD data of 2013, the BoG underlines that 79% of the population in Greece was not covered with insurance and therefore without medical and medicine due to long-term unemployment, while self-employed could not afford to pay their social contributions.

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“>A survey conducted in 2014 by ELSTAT showed that part of population above 15 years old was in need of medical help but did not receive it due to lack of financial means:

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“>13% of population did not receive medical care or treatment

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“>15.4% of population did not receive dental care of treatment

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“>4.3% of population did not receive mental health care services

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“>11.2% did not take the prescription medicine prescribed by doctors.

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“>The same survey shows a decrease in private hospital admissions and increase in public hospital with the effect that public hospitals are not able to cope with the increase demands due to austerity budget and personnel cuts. Public hospital admission in 2009 were 1.6 million, and 2.5 million in 2014.

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“>According to the survey, percentage of population that needed to receive medical-nursing care and received it in delay or not at all was:

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“>13.1% due to long waiting list

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“>6.1% due to long distance or transportation problems

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“>9.4% due to lack of specialized doctors and health personnel.

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“>The BoG report warns that the economic crisis and the devaluation of the health sector threaten to shrink the life-expectancy.

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“>Everyone who lives in Greece knows very well the drug with the long waiting lists in to get an appointment for an medical examination or a diagnostic checks in public hospitals. In some cases the next appoint for a simple check may take up to a year. Due to merging of hospitals and primary health centers, people may need to travel even 120 km to find the doctor they need. Just a couple of days ago, KTG posted about the dramatic situation in Ierapetra town in south Crete and the people in their despair would rather seek the help of a local veterinarian than a doctor for humans.

However, t<span title=") ???? µ?????? ?????? ???µ????, ?) ?? 6,1% ??? ??????µ?? ???? µ?????? ???- ?????? ? ??????µ???? ??? µ??????? ??? ?) ?? 9,4% ??? ??????µ?? ???? ???????? ??????????? ?????? ??? ???????µ????? ??????.

“>he crisis does not affect the patients only. It affects the health personnel as well. It was just two days ago, when a friend of mine, a doctor specialized in vascular diseases was telling me that while he was always keeping the necessary distance to patients he has started to be affected because people are really suffering due to the economic crisis. “There is a lot of drama out there, and I cannot close my eyes to it.” he said.

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“>One of the neighborhood pharmacists has been telling me on and off about the dramatic number of patients who cannot afford the self-participation in prescription medicine. Many of his clients cut their treatment into half – like 1 tablet for cholesterol not daily but every other day basis – and that some have given up the whole treatment. “For some people the choice is: either have treatment or food.”

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“>And this has been going on since 2012, when then Greek Health Minister adopted the German model of “self-participation in prescription medicine, laboratory tests” and cut some primary health services but forgot to adopt also that aspect of the German model that provides that patients would not spend more than 2% of their income for medical services and medication.

But I’ve written many times about this in the past, haven’t I? I thought to give a break to the “Greek drama” but reality is stronger than the blogger’s wishes and plans.

Source: Bank of Greece Report, other details here, here

P.S. life-expectancy will shrink? I suppose the creditors would be more than happy about it as people will die, pensions will not be paid and insurance funds will be saved.
Orlando Victims Died Because They Were Unarmed – Not Because They Were Gay

Submitted by Brandon Smith via Alt-Market.com,

Numerous liberty movement analysts and proponents, myself included, have been warning about 2016 and the heightened potential for multiple terrorist events. I have written extensively on the history of ISIS, its proven ties to western governments and the disturbing program to forcefully inject millions of Islamic refugees into western nations in the name of dubious “multiculturalism,” allowing thousands of potential terrorists into our borders without obstruction. The reality is that terrorist attacks of small and medium scale are likely to become a monthly or weekly occurrence in the U.S. and the EU as we close in on the end of the year. Get used to the idea, because this problem is not going to go away while our own governments are aiding and even funding the very psychopaths that they are supposed to be protecting people from.

The recent attack at at gay club in Orlando by a self-proclaimed ISIS advocate, killing at least 49 people and wounding at least 53 more, was not at all a surprise. The scale of the attack should have been expected. No one in the U.S. should have assumed anything less given the number of dead during events in Europe.

What is frustrating, however, is that even though these attacks are highly predictable, very few Americans seem to be preparing in any meaningful way to counter them. In fact, I happened across a clip of establishment mouthpiece Bill O’ Reilly the other day arguing that there “is nothing that we can do” to stop such "lone wolf attacks".

Ostensibly, this is an argument against the inevitable push for more gun control by Leftists in the wake of the Orlando massacre; but it also sets a dangerous and false precedent in the minds of the public. The fact of the matter is, the American people CAN stop the majority of terrorist attacks of this nature anytime they wish, without the aid of government or the implementation of unconstitutional gun control measures.

On the “progressive” side of the debate, of course, their only solution is to promote more gun control. They have a habit of exploiting every tragedy in order to defile the 2^nd Amendment and dance in the blood of mass shooting victims while furthering their agendas. They could not care less about the people who died, they only care about the political capital their deaths can buy.

In the wacky social justice camp, a “feel good” approach is being pursued. The argument among the cultural Marxists is that we must “turn hate into love,” whatever that means. But the basic strategy seems to be to ignore the glaring problems with Islamic fundamentalism (whether supported by government or not) and blame straight white people for their supposed "colonial privilege" instead.

All camps also seem to be overly focused on the sexual proclivities of the victims. The fact that a gay club was the target has LGBT organizations in a frenzied rush to capitalize on the hate crime train. Of course, the reality that the Left has consistently defended the integration of Islam and western culture is never brought up. I have not yet seen the social justice crowd explain how they can reconcile the jihadist contempt for homosexuals with their supposed concern for the safety of the gay community. I am certainly interested to watch the mental gymnastics in action, though.

Frankly, the sexual “identities” of those killed does not really matter much. Followers of ISIS have not necessarily shown any favoritism to any particular target group. They’ll kill just about anyone, including their own comrades in arms if there is something to be gained by it.

With all the sociopolitical blathering going on in the mainstream media, the core issue has been completely overlooked — why did those people die?

As stated in the title, they did not die because they were gay. ISIS agents kill all kinds of people under a spectrum of motives. They may or may not have been attacked because they were gay (according to former classmates and his ex-wife, Mateen may have even been gay himself), but they died for other reasons.

The victims also did not die because gun control measures are not in place; Omar Mateen passed background checks when purchasing his weapons. No amount of added measures would have flagged him because he had no criminal record to speak of. And, as the ISIS attacks in Paris proved, bad guys can get their hands on guns even in countries with the most stringent gun control laws.

Perhaps the federal government could have stopped Mateen; they had already been watching him for years. But, the feds either ignored the danger or were well aware of the danger and did nothing (this seems to be a constant trend in the history of terrorism in the U.S.). In either case, the government is not going to save you from terrorism, and if your only hope is that you expect the authorities to keep you from harm, you are probably going to die.

Leftists want to direct public interest towards the gay issue. They want to make the Orlando attack a martyr’s cry for the LGBT community and social justice warriors. But the cold truth is that most or all of the people killed in Orlando could have lived — if only they had a logical attitude of self defense.

I have enough tactical background to recognize a professional shooter. Anyone who can walk into the sheer wall of human chaos that erupts in a crowded building during an active shooter scenario and still be able to achieve the fire discipline necessary to achieve kill shots on 50 people and wound 53 more is highly trained. A random spraying of bullets into a crowd is not going to produce such results. This was the work of a collected and skilled person, or, there were other shooters present that we are not yet aware of.

The ONLY remedy to remove a skilled active shooter (or even most unskilled active shooters) is another skilled shooter. That night in Orlando ended in a bloodbath because there were no skilled civilian shooters, gay or straight, present in the building when the attack occurred.

Now, given, if a terrorist is searching for a soft target, you can’t get much softer than a gay night club. The lack of self defense instinct and a penchant for anti-gun politics make the gay community easy pickings. However, the potential for self defense is present in almost every person as long as proper training is applied.

As I have pointed out in the past, even the FBI admits that the vast majority of active shooter scenarios that are stopped are obstructed by civilians present at the event, NOT by law enforcement. The great lie being perpetuated in the mainstream is that you must have "government training" to handle an active shooter. In reality, civilians are the most common and effective stop measure. Many active shooters will even commit suicide immediately after they meet any resistance from intended victims in order to avoid prolonged pain or capture. You are the first and sometimes only responder when your own life is in danger.

In the end, the danger represented by “lone wolf” terrorism or organized terrorism is energized by the American public’s refusal (on both the Left and the Right) to accept that the only practical solution is an armed and trained citizenry. We can argue for an eternity about “hate crime,” Islamic integration, government vigilance, etc. None of it will amount to jack. Nothing will ever be accomplished. The real debate, the debate that the establishment does not want the American public to entertain, is the debate over our level of personal preparedness.

The mainstream narrative demands that we argue over gun control, multiculturalism, more government and better vetting of potential terrorists. While all these issues are vital for various reasons, none of them confront the greater problem. If Americans are not interested in methods to protect themselves, then all else is futile. Each individual must decide his or her potential safety margin.

The bottom line? If you want better odds of survival, you will arm yourself, you will train regularly to handle active shooter scenarios and you will carry your weapon avidly. If you do not, then YOU are responsible for every consequence that you, and those you care for, suffer down the road.
US Negative Interest Rate Bets Surge To Record Highs

As the "deflationary supernova" sweeps across the world, dragging bond yields to zero-and-beyond, even the almighty omniscent Federal Reserve has been forced to capitulate as the 'cheapness' of Treasury bonds lures the world's yield-hunters dragging it ever closer to the negative rate realities of Switzerland, Japan, and Germany. As rate-hike odds collapse, along with The Fed's credibility, so investors are increasingly betting on the chance that the inevitable negative interest rate washes ashore in a US money-market-crushing manner. While bets on 'NIRP' in 2016 have faded modestly, expectations for a 'below-zero' rate in 2017 (and implictly a stock market crash) have never been higher…

We suspect the words "it could never happen here" were uttered numerous times in Switzerland, Japanese, and German halls of officialdom over the past few years…

And with The Fed rapidly losing faith…

It appears not only are Treasury yields attractively 'cheap' (and "safe") to the rest of the world's bonds…

But their relative moves to stocks also suggest something is amiss in equity land around the world…

And so, traders are increasingly positioning for negative rates in 2017… or, as we explain below, positioning cheaply for a stock market crash…

[the chart shows the cumulative open interest in par calls on eurodollar futures contracts that expire in 2016 and 2017 – basically options on short-term interest rates with a strike price of zero, such that they pay out if the Fed takes rates negative]

As we explained previously, when queried whether this is indeed a trade to bet on a market drop, Michael Green responded as follows:

[A reader] thought this might be an attempt by hedge funds to hedge out their exposure to rising interest rates very cheaply.

My initial idea was that it actually could be a bet on negative rates (if for some reason the Fed had to come back into the picture with QE4).

The bottom line:

"Deep OTM puts on the S&P are very expensive while par ED calls are relatively cheap.

In my view, we are that inflection point where the Fed is going to start to waffle…the bear market beckons and they will not be able to stick with their interest rate guidance. Of course, markets tend to frown on Central Bankers revealed as less than omniscient…"

Loking at the chart above, one wonders if The Fed tries QE in 2016 first, and/or increases its war on cash before negative rates are forced upon Americans.
Terrorism As Pretext For Intervention In Middle East

Submitted by Nauman Sadiq via OrientalReview.org,

In order to understand the hype surrounding the phenomena of Islamic radicalism and terrorism, we need to understand the prevailing global economic order and its prognosis. What the pragmatic economists have forecast about the free market capitalism has turned out to be true; whether we like it or not. A kind of global economic entropy has set into motion. The money is flowing from the area of high monetary density to the area of low monetary density.

The rise of the BRICS countries in the 21st century is the proof of this tendency. BRICS are growing economically because the labor in developing economies is cheap; labor laws and rights are virtually nonexistent; expenses on creating a safe and healthy work environment are minimal; regulatory framework is lax; expenses on environmental protection are negligible; taxes are low; and in the nutshell, windfalls for the multinational corporations are huge.

Thus, BRICS are threatening the global economic monopoly of the Western capitalist bloc: that is, North America and Western Europe. Here we need to understand the difference between the manufacturing sector and the services sector. The manufacturing sector is the backbone of the economy; one cannot create a manufacturing base overnight. It is based on hard assets: we need raw materials; production equipment; transport and power infrastructure; and last but not the least, a technically-educated labor force. It takes decades to build and sustain a manufacturing base. But the services sector, like the Western financial institutions, can be built and dismantled in a relatively short period of time.

If we take a cursory look at the economy of the Western capitalist bloc, it has still retained some of its high-tech manufacturing base, but it is losing fast to the cheaper and equally robust manufacturing base of the developing BRICS nations. Everything is made in China these days, except for hi-tech microprocessors, softwares, a few Internet giants, some pharmaceutical products, the Big Oil and the all-important military hardware and the defense production industry.

Apart from that, the entire economy of the Western capitalist bloc is based on financial institutions: the behemoth investment banks, like JP Morgan chase, total assets $2359 billion (market capitalization: 187 billion); Citigroup, total assets $1865 billion (Market Capitalization: 141 billion); Bank of America, total assets $2210 billion (Market Capitalization: 133 billion); Wells Fargo, Goldman Sachs, BNP Paribas and Axa Group (France), Deutsche Bank and Allianz Group (Germany), Barclays and HSBC (UK).

After establishing the fact that the Western economy is mostly based on its financial services sector, we need to understand its implications. Like I said earlier, that it takes time to build a manufacturing base, but it is relatively easy to build and dismantle an economy based on financial services. What if Tamim bin Hammad Al Thani (the ruler of Qatar) decides tomorrow to withdraw his shares from Barclays and put them in some Organization of Islamic Conference-sponsored bank, in accordance with Sharia?

What if all the sheikhs of Gulf countries withdraw their petro-dollars from the Western financial institutions; can the fragile financial services based Western economies sustain such a loss of investments? In April this year the Saudi finance minister threatened that the Saudi kingdom would sell up to $750 billion in Treasury securities and other assets if Congress passed a bill that would allow the Saudi government to be held responsible for any role in the September 11, 2001 terror attacks. And $750 billion is only the Saudi investment in the US, if we add its investment in Western Europe, and the investments of UAE, Kuwait and Qatar in the Western economies, the sum total would amount to trillions of dollars of Gulf’s investment in the US and Western Europe.

Notwithstanding, we need to look for comparative advantages and disadvantages here. If the vulnerable economy is their biggest weakness, what are the biggest strengths of the Western powers? The biggest strength of the Western capitalist bloc is its military might. We have to give credit to the Western hawks they did which nobody else in the world had the courage to do: that is, they privatized their defense production industry. And as we know, that privately-owned enterprises are more innovative, efficient and in this particular case, lethal. But having power is one thing, and using that power to achieve certain desirable goals is another.

The Western liberal democracies are not autocracies; they are answerable to their electorates for their deeds and misdeeds. And much to the dismay of pragmatic, Machiavellian ruling elites, the ordinary citizens just can’t get over their antediluvian moral prejudices. In order to overcome this ethical dilemma, the Western political establishments wanted a moral pretext to do what they wanted to do on pragmatic, economic grounds. That’s when 9/11 took place: a blessing in disguise for the Western political establishments, because the pretext of “war on terror” gave them carte blanche powers to invade and occupy any oil-rich country in the Middle East and North Africa region.

No wonder then that the first casualty of “war on terror” after Afghanistan had been Iraq; and what did the corporate media tell us about invading Iraq back in 2003? Saddam’s weapons of mass “deception” and his purported links with al Qaeda? It is only a coincidence that Iraq holds 140 billion barrels of proven crude oil reserves and produces more than 3 million barrels per day of crude oil.

Then again what did the Western mainstream media tell us about the Libyan so-called “humanitarian intervention” in 2011? Peaceful and democratic protests by the supposedly “moderate and secular” Libyans against the Qaddafi regime and the Western responsibility to protect the supposedly democratic revolutions and civilian lives? Once again it is only a coincidence that Libya holds 48 billion barrels of proven oil reserves and produces 1.6 million barrels per day of most easily extractable crude.

Fact of the matter is that monopoly capitalism and global neo-colonial economic and political order are the real issues, while Islamic radicalism and terrorism are the secondary issues and itself a byproduct of the former. That’s how the mainstream media constructs artificial narratives and dupes its audience into believing them: during the Cold War it created “the Red Scare” and told its audience that communism is an existential threat to the free world and the Western way of life; the mainstream media’s naïve audience bought this narrative.

Then the Western powers and their Saudi and Pakistani collaborators financed, trained, armed and internationally legitimized the Afghan “freedom fighters” and used them as proxies against the Soviet Union.

After the dissolution of the Soviet Union they declared the former “freedom fighters” to be terrorists and another existential threat to the free world and the Western way of life. The audience of the corporate media again bought this narrative.

Then again, during the Libyan and Syrian civil wars the former “terrorists” once again became freedom fighters – albeit in a more nuanced manner, this time around the corporate media sells them as “moderate rebels.” How on earth could you label a militant holding a gun in his hands as “moderate and peaceful?”

The way I see it, Islamic State, like its predecessor, al Qaeda, is also a hobgoblin to create an atmosphere of fear in order to justify an interventionist policy in the energy-rich Middle East. Islamic State in Iraq and Syria is quite different from its so-called affiliates in remote and disparate regions such as Libya and Sinai.

Only thing that differentiates Islamic State from other ragtag jihadist outfits is its sophisticated weapons arsenal that has been provided to it by NATO and bankrolled by the Gulf Arab states during the Syrian proxy war; another factor that gives a comparative advantage to Islamic State over other jihadist outfits is its top and mid-tier command structure, which is comprised of professional, ex-Baathist military and intelligence officers from Saddam era.

Any militant outfit that lacks Islamic State’s weapons arsenal and its professional command structure cannot claim to be affiliated with it merely on the basis of ideological affinity without any organizational and operational link. Moreover, Islamic State is not a terror outfit like al Qaeda; it has overrun one-third of Syria and Iraq, therefore, it’s an insurgent organization.

In order to sustain their crumbling “war on terror” narrative, the Western powers now make a distinction between “the green, yellow and red terrorists” – green militants, like the Free Syria Army, whom the NATO overtly supports; yellow jihadists, such as the Army of Conquest that includes the Saudi-supported, hardline Islamists like Ahrar al-Sham and the al-Qaeda-affiliate al-Nusra Front, whom the NATO covertly supports; and the red terrorists like the Islamic State which is a by-product of the hypocritical Western policy in Syria and Iraq.

Photo taken in Benghazi, Libya, in February 2016

In the last 15 years of the so-called “war on terror” the Western powers have toppled only a single Islamist regime of Taliban in Afghanistan and three Arab nationalist regimes — Saddam’s Baathist regime in Iraq, Qaddafi’s Afro-Arab nationalist regime in Libya and they are now desperately trying to oust another anti-Zionist, Baathist regime of Bashar al-Assad in Syria.

Some of the high-ranking American and British security officials, like Dennis Blair of NSA, Eliza Manningham-Buller of MI-5 and Alastair Crooke of MI-6, have conceded on the record that bringing down the possibility of incidents of terrorism to a zero-level in a highly militarized world is simply not an option.

Terrorism is only a crime, a heinous crime but a crime, nevertheless; it is not an act of war. Those who treat it like an act of war have ulterior motives. It is the job of the law enforcement and intelligence agencies to prevent and minimize such incidents from taking place, however, as the above mentioned security specialists have stated in their reports that just like any other crime the incidents of terrorism can be brought down significantly by implementing prudent and long-term security and foreign policies, but complete elimination of terrorism is simply not a possibility.

Crimes like murders, thefts, robberies and rapes do occur in all societies; in the ideal, prosperous and peaceful societies the rate of such crimes is low, while in the impoverished and conflict-ridden societies the rate of such crimes is high. But there will always be criminals like Anders Breivik and Seung-Hui Cho of Virginia Tech massacre-fame who would unleash a reign of terror in any given society.

Notwithstanding, the phenomena of militancy and insurgency has less to do with religious extremism, as such, and more with the weak writ of the state in the rural and tribal areas of the developing countries, which has further been exacerbated by the deliberate weaponization of certain militant groups by the regional and global players.

The Maoist insurgency in India, for instance, has claimed 2,866 fatalities since 2010; and they are Hindus, not Muslims. Whether it’s Islamist or Maoist radicals, such insurgencies are only the reactions to wealth disparity and uneven development that has mostly been limited to the urban centers while the rural hinterland languishes in abject poverty, and the law enforcement and the state’s security apparatus does not has a presence in the insurgency-prone areas.

The root factors that have primarily been responsible for spawning militancy and insurgency anywhere in the world is not religion but socio-economics, ethnic diversity, marginalization of the disenfranchised ethno-linguistic and ethno-religious groups and the ensuing conflicts; socio-cultural backwardness of the affected regions, and the weak central control of the impoverished developing states over their territory.

After invading and occupying Afghanistan and Iraq, and when the American “nation-building” projects failed in those hapless countries, the US’ policy-makers immediately realized that they were facing large-scale and popularly-rooted insurgencies against the foreign occupation, consequently, the occupying military altered its CT (counter-terrorism) doctrines in the favor of a COIN (counter-insurgency) strategy. A COIN strategy is essentially different from a CT approach and it also involves dialogue, negotiations and political settlements, alongside the coercive tactics of law enforcement and military and paramilitary operations on a limited scale.

All the regional militant groups like the Taliban, Islamic State, al Shabaab in Somalia and Boko Haram in Nigeria; and even some of the ideological affiliates of al Qaeda and Islamic State, like AQAP, AQIM, Islamic State in Afghanistan, Yemen and Libya, which have no organizational and operational association with al Qaeda Central or the Islamic State of Iraq and Syria, respectively, are not terror groups, as such, but Islamist insurgents whose cherished goal is the enforcement of Shari’a in the areas of their influence, like their progenitor, the Salafist State of Saudi Arabia.

Saudi Arabia’s risky oil game

Finally, I fail to see the reason why the Western powers have been blowing the Islamist insurgencies in the Middle East out of proportions, which have been but the consequence of their own ill-conceived wars in Afghanistan, Iraq, Libya, Yemen, Somalia and Syria? What is it that the insurgents want and the so-called “liberal interventionists” cannot accept as a matter of principle? Is it the enforcement of Shari’a, or the barbaric Hudood-style executions that have earned the Taliban, Islamic State, al Shabaab and Boko Haram the odium of the international community? If that is the case, then why do the Western powers overlook the excesses committed by Saudi Arabia where Shari’a is the law of the land and Hudood-style executions are an everyday occurrence?

This contradiction speaks volumes about the sheer hypocrisy and double standards of the Western powers: that, when it comes to securing 265 billion barrels of Saudi oil reserves and 100 billion barrels, each, of UAE and Kuwait that together constitutes 465 billion barrels, i.e. one-third of the world’s proven crude oil reserves, they are willing to overlook the excesses that have been committed by such Medieval regimes but when it comes to negotiating with the Islamist insurgents to reach political settlements and to let up on all the violence and spilling of blood in the region, they stand firm against the so-called “terrorists” as a matter of principle.
GAO Report Reveals The FBI Has Built A Massive Facial Recognition Database

In what should come as a surprise to absolutely nobody (as we previewed it here years ago), a new report by the Government Accountability Office (GAO) reveals that the FBI has compiled a massive facial recognition database without any oversight.

The FBI has accessed driver's license photo databases from 16 states, as well as passport and visa photo databases from the State Department which were used to compile a facial recognition database of millions of Americans and foreigners who have never been accused of a crime TechCrunch reports.

The FBI has access to a stunning 411.9 million images for use in its facial recognition program, and while that should be enough to disturb everyone, the fact that the FBI ignored the Privacy Act which requires government agencies to disclose how they harvest and use personal information such as ID photos should ratchet that anxiety up a bit more. Oh, and one more thing, it's working with 16 more states to provide even further database access as well.

According to the report, the DOJ has an oversight structure in place to help ensure privacy protections, but didn't approve the program until well over three years since the pilot began.

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Speaking of privacy protections, the report found that the FBI has never done a true audit of the system to test its accuracy, so it doesn't even know if it's reliable or not.

"There appears to be no internal oversight on this system and that's remarkable. Today we found out that they have no idea if they're misusing it or not, they've [FBI] literally never done an audit." said Alvaro Bedoya, executive director of the Center on Privacy and Technology at Georgetown Law. "They might not be storing these photos at Quantico but it has built, in effect, a nationwide biometric database using driver's license photos. It's breathtaking" Bedoya added.

"I have always maintained that Americans have a fundamental right to privacy, and I believe that in order to protect this right, our citizens must have a basic understanding the tools law enforcement uses to keep them safe. This GAO report raises some very serious concerns, and reveals that the FBI's use of facial recognition technology is far greater than had previously been understood. This is especially concerning because the report shows that the FBI hasn't done enough to audit its own use of facial recognition technology or that of other law enforcement agencies that partner with the FBI, nor has it taken adequate steps to ensure the technology's accuracy." Senator Al Franken said in a statement on the report.

One final point that should keep everyone up at night (but won't) is the fact that the FBI has proposed that the database be exempt from the provisions in the Privacy Act completely. Said otherwise, the FBI wants to (continue to) collect data on people and never have to disclose how it's collected, and what it's used for. Then again by doing whatever it wants anyway, we're already at that point.

Land of the free, and such.
The Fed Has Brought Back "Taxation Without Representation"

Submitted by Simon Black via SovereignMan.com,

In February 1768, a revolutionary article entitled “No taxation without representation” was published London Magazine.

The article was a re-print of an impassioned speech made by Lord Camden arguing in parliament against Britain’s oppressive tax policies in the American colonies.

Britain had been milking the colonists like medieval serfs. And the idea of ‘no taxation without representation’ was revolutionary, of course, because it became a rallying cry for the American Revolution.

The idea was simple: colonists had no elected officials representing their interests in the British government, therefore they were being taxed without their consent.

To the colonists, this was tantamount to robbery.

Thomas Jefferson even included “imposing taxes without our consent” on the long list of grievances claimed against Great Britain in the Declaration of Independence.

It was enough of a reason to go to war.

These days we’re taught in our government-controlled schools that taxation without representation is a thing of the past, because, of course, we can vote for (or against) the politicians who create tax policy.

But this is a complete charade. Here’s an example:

Just yesterday, the Federal Reserve announced that it would keep interest rates at 0.25%.

Now, this is all part of a ridiculous monetary system in which unelected Fed officials raise and lower rates to induce people to adjust their spending habits.

If they want us little people to spend more money, they cut rates. If they want us to spend less, they raise rates.

It’s incredibly offensive when you think about it– the entire financial system is underpinned by a belief that a committee of bureaucrats knows better than us about what we should be doing with our own money.

So this time around the grand committee decided to keep interest rates steady at 0.25%.

Depending on where you sit, this has tremendous implications.

If you’re in debt up to your eyeballs (like the US government), low interest rates are great.

It means the government can continue to borrow even more money and go even deeper into debt.

Low interest rates are also good for banks, because they can borrow for nothing from the Fed, then earn a handsome profit on that free money.

But if you’re a responsible saver, low interest rates are debilitating.

Banks only pay their depositors about 0.1% interest. Yet according to the US Labor Department, inflation is at least 1.1%, and has averaged 2.23% since 2000.

This means that when adjusted for inflation, anyone who bothers saving money is losing at least 1% every single year.

That might not sound like much. But compounded over a longer period, it can lead to a substantial difference in your standard of living.

Maybe that’s why the government’s own numbers show that wages, when adjusted for inflation, are far lower than they were even 15 years ago.

Or why wealth inequality is now at a level not seen since the Great Depression.

Or why alarming data from Pew Research last year show that the middle class is now no longer the dominant socioeconomic stratum in the United States.

Back during his days as a presidential candidate, Ron Paul used to frequently remark that inflation is an invisible tax on the middle class.

And he’s right.

The combination of inflation and low interest rates benefits certain people, while it causes middle class people’s savings to lose purchasing power.

This constitutes a transfer of wealth from savers to debtors.

In other words, it’s a tax.

Yet unlike a normal tax which is passed by Congress, this inflation/interest rate tax is created by the central bank.

You and I don’t get to vote for the twelve members of the Federal Reserve Open Market Committee (FOMC) who dictate interest policy.

In fact, based on the way the Federal Reserve works, the majority of the committee members are actually appointed by commercial banks.

Here’s the quick version: there are twelve Federal Reserve banks in the US banking system.

They’re located in major cities like New York, San Francisco, St. Louis, Dallas, etc. And each Federal Reserve bank has its own separate Board of Directors.

Yet two-thirds of the board members for each Federal Reserve bank are appointed by big Wall Street banks like JP Morgan and Goldman Sachs.

And oh, hey, what a surprise, the last three major appointments to the Federal Reserve were all former high-level Goldman Sachs employees.

These guys aren’t even trying to hide the fact that Wall Street banks control the Fed.

So, Wall Street banks control the boards of directors at the Fed banks. The Fed bank boards of directors appoint the committee members who set monetary policy.

And the monetary policy they set ends up being a gigantic tax… a transfer of wealth from the middle class to a tiny group of beneficiaries, including the US government and the banks themselves.

This is an unbelievable scam… and it truly is taxation without representation.

Unelected bureaucrats impose their will over the entire financial system in a way that benefits a handful of people at the expense of everyone else.

And we have absolutely no say in the matter.

Well, actually we do.

Even though we can’t vote for the boards of directors at the various Federal Reserve banks like Citigroup and Goldman Sachs can do, we are able to vote with our dollars.

Think about it: every single dollar that you keep in this poor excuse for a financial system is a tacit vote in favor of the corruption.

Every dollar you take out of the system is a vote against it.

And as we’ve explored before, there are substantial options for your savings– precious metals, cryptocurrencies, productive real estate, safe P2P arrangements with strong yields, and well-capitalized banks abroad that actually pay sufficient interest to keep up with inflation.
"It's Only A Matter Of Time Before Many Of Them Blow Up" – The Default Cycle Has Begun

It's been a tough year for traders and bankers alike, as layoffs have gripped firms due to difficult trading environments and an overall sluggish economy.

However, there is one area that is starting to actually pick up. As the number of bankruptcies begin to increase, firms are expanding their turnaround teams in order to handle all of the work headed their way – bankers with experience in turnarounds and restructuring are now in high demand.

"Firms are hungry for experienced restructuring professionals, who are increasingly in short supply. You need to reach deep into your Rolodex to find people you know who are capable, and you need to move fast." said Richard Shinder, hired by Piper Jaffray in March to help build out its restructuring team.

Both the number of bankruptcies and the amount of liabilities associated with them have picked up significantly, as Bloomberg points out.

With the amount of companies in distress, firms such as Lazard, Guggenheim Partners, Perella Weinberg Partners and AlixPartners are all hiring in anticipation of even more bankruptcies.

"Cycles come and go, but when a wave hits, you want to make sure you are in the right seat with the right group of people. We are putting the band back together." said Ronen Bojmel, who is helping to build the restructuring team at Guggenheim.

Moody's is forecasting high default rates in sectors that are largely expected given commodity prices, such as Metals & Mining and Oil & Gas, however trouble looks to be spilling over into other sectors such as Construction, Media, Durable Consumer Goods, and even Retail. As we have discussed for quite some time, central banks in their infinite wisdom have made the cost of money so cheap that it has created an environment that forces a complete misallocation of capital in the market as the search for yield continues down every rabbit hole it can find. This will (and already is) inevitably catch up to the economy in the form of defaults and bankruptcies.

"The wave is already here. Many risky debt deals have been done as people chased yield, and it's a matter of time before many of them blow up." said Tim Coleman, head of PJT Partners.

Business is booming for firms such as Guggenheim and Lazard, which implicitly means very bad news for the rest of the economy.

From BBG

Guggenheim has one of the fastest-growing turnaround teams, with 11 senior advisers brought on in less than three years. Projects include advising satellite operator Intelsat SA, which has more than $15 billion of debt. For Lazard, the largest independent merger adviser, restructuring advisory revenue jumped 84 percent to $42.6 million in the first three months of this year from the same period last year, according to filings. Its work included negotiating turnaround plans for Vantage Drilling, an oil-and-gas company that sought bankruptcy protection in December, and Walter Energy Inc., a coal producer that filed last summer.

"Restructuring advisers have been busy moving to different firms lately. That shows a growing conviction that the next cycle is upon us and there is a desire to be in the right seat when the music stops. And if you're really lucky, among friends you know and trust." Said Guggenheim's Durc Savini.

The right seat when the music stops, that sounds like something tin foil hat wearing irrelevant bloggers would say. At any rate, with the corporate bankruptcy index surging, and firms scrambling to bolster restructuring teams, we recommend that everyone remain acutely aware of these developments.
Here's What You Need To Know About The Cold War 2.0 (Because It's Already Here)

Submitted by Claire Bernish via TheAntiMedia.org,

As mainstream media attention largely focuses on complex entanglements destabilizing the Middle East, the United States continues to advance a rather aggressive agenda against Russia through its NATO allies in the Balkans and beyond. While an amassing of NATO troops in states bordering the U.S.’ Cold War foe might be troubling news in itself, an examination of several factors provides ample reason for vigilance.

Source: RiskAdvisory

On Tuesday, NATO Secretary-General Jens Stoltenberg announced the alliance would be sending 4,000 troops to the Baltic states and Poland after nervous nations called for increased NATO presence following Russia’s annexation of Crimea. Germany, the U.S., the U.K., and an as-yet unnamed fourth nation will deploy troops to Estonia, Lithuania, Latvia, and Poland at some point in 2017. But the build-up won’t be limited to those areas.

“We are looking into how we can increase our presence in the Black Sea region,” Stoltenberg explained to reporters prior to Tuesday’s meeting of the defense ministers. “We have already increased our presence with more air-policing, with assurance measures, with more naval presence and with more exercises.

“But we are also looking into what more we can do. And we are discussing and addressing an offer from Romania that they can provide the framework, the headquarters for a brigade that can then organize and facilitate NATO activities in the region, including exercises and also assurance measures.”

Following the meeting, the Secretary-General told the press, “I welcome the commitments made by many allies today to contribute.”

Russia, however, understandably sees the bolstering of troops — particularly in the Black Sea region — in a different light.

“This is not NATO’s maritime space and it has no relation to the alliance,” Russia’s director on European affairs, Andrey Kelin, told Interfax.

At a meeting of the Atlantic Council last month, Stoltenberg asserted the U.S. and E.U., as Zero Hedge paraphrased, “have the right in the form of NATO to defend its territories on foreign soil” in regard to Russia. This muddied stance — positing offense behind the thin veil of taking defensive measures — has generated concerns among policy critics who see such moves as poking the Cold War hornet’s nest and capable of provoking military conflict. And for good reason.

While geopolitical wrangling through NATO continues, the U.S. has initiated a sweeping secret project called The Russia New Generation Warfare — an “analysis of how Russia is reinventing land warfare in the mud of eastern Ukraine,” as DefenseOne described — or, a study tasked with modernizing ground capabilities to counter perceived superiority of Russian forces. Director of the U.S. Army’s Capabilities Integration Center, Lt. Gen. H. R. McMaster describes the impetus for the project — lack of preparedness — as if ground conflict with Russia in this new Cold War is a virtual foregone conclusion.

“We spend a long time talking about winning long-range missile duels,” McMaster explained, noting such strategy doesn’t account for what happens after such a bombardment. What the U.S. needs, he said, is an increase in, as well as better, artillery.

“We’re outranged by a lot of these systems and they employ improved conventional munitions, which we are going away from,” he said. “There will be a 40- to 60-percent reduction in lethality in the systems that we have. Remember that we already have fewer artillery systems. Now those fewer artillery systems will be less effective relative to the enemy. So we need to do something on that now.”

McMaster’s concerns surround updating capabilities of ground operations to align and preferably surpass those of Russia; but the greatest threat — the one that has frozen the Doomsday Clock at three minutes to midnight — is the potential for escalation to nuclear war. And as hyperbolic as that may sound, either U.S.- or Russian-instigated nuclear war isn’t at all the outside possibility it had been for years following the first Cold War.

Though a nuclear attack as a first-strike act of aggression might not happen anytime soon, as Seth Baum, executive director of the Global Catastrophic Risk Institute, explains the situation, aggression should be the least of our concerns.

“The fact that no nuclear war has ever happened does not prove that deterrence works, but rather that we have been lucky,” Baum warned.

Inadvertent nuclear war actually presents a far greater threat than a basic act of aggression with nuclear missiles. In fact, accidents in judgment around the world put us all at risk a startling number of times each year. U.S. and NATO tacitly provoking Russia through the installation of bases and troop buildup flanking Russian borders, in the context of accidental nuclear war, constituted a major factor in the decision by the Bulletin of the Atomic Scientists to move the Doomsday Clock to the brink of midnight.

According to the latest available data, Baum explained, between 1977 and 1983, false alarms — moments when one nation or another had nearly launched nuclear warheads in response to faulty information another had already done so — occurred between 43 and 255 times each year. While statistics more current than 1983 remain classified, the posturing between NATO and Russia makes the sheer number of false alarms a pertinent cause for vigilance.

“Russia understands as well as China (and U.S. strategists, for that matter) that the U.S. missile defense systems near Russia’s borders are, in effect, a first-strike weapon, aimed to establish strategic primacy — immunity from retaliation,” Professor Noam Chomsky explains in his latest book, Who Rules the World? “Perhaps their mission is utterly unfeasible, as some specialists argue. But the targets can never be confident of that. And Russia’s militant reactions are quite naturally interpreted by NATO as a threat to the West.

“One prominent British Ukraine scholar poses what he calls a ‘fateful geographic paradox’: that NATO ‘exists to manage the risks created by its existence.’”

Chomsky somewhat ominously adds, “The threats are very real right now.”

With President Obama’s nuclear weapons modernization budget topping the $1 trillion mark, critics question the needless stoking of Cold War rivalries through a de facto renewed arms race.

“Both Russia and the United States are now officially and publicly using the other side as a justification for nuclear weapons modernization programs,” Hans Kristensen, director of the Nuclear Information Project, told the Intercept in an email.

This sentiment echoed that of David Culp, a legislative representative with the Quaker-affiliated Friends Committee on National Legislation, whom the Intercept cited:

“The increased spending on U.S. nuclear weapons is already provoking similar responses from Russia and China. We are slowly slipping back into another Cold War, but this time on two fronts.”

Geostrategic wrangling along Russia’s borders isn’t cause for panic, by far. But with attentions trained on the caustic imbroglio on numerous Middle East fronts, it remains imperative to understand that a less immediate — but no less crucial — additional arena is ramping up. Particularly as repercussions from the latter could most directly impact us all.
"Loan Stacking" – The Blind Spot That Could Blow Up The P2P Model

Back in February we noted that there were cracks starting to show in the world of P2P lending, and more specifically, with LendingClub's inability to assess credit risk of its borrowers that were causing the company to experience higher write-off rates than forecast.

From that February post, here is a chart that was used in a LendingClub presentation showing just how far off the company was in predicting write-off rates – it was evident then that their algorithms weren't working very well.

Here is what we said at the time:

What the slide above shows is that LendingClub is terrible at assessing credit risk. A write-off rate of 7-8% may not sound that bad (well, actually it does, but because P2P is relatively new, we don't really have a benchmark), it's double the low-end internal estimate.

That's bad. In other words, we said, the algorithms LendingClub uses to assess credit risk aren't working. Plain and simple.

And now courtesy of Reuters, we learn of a critical blind spot in the world of online lending. The risk to these online P2P companies such as LendingClub, is that as shown above, robust enough credit checks have not been developed to gauge true credit risk of borrowers. If said borrowers had what are referred to as "stacked" loans, meaning they have taken out one loan in order to pay for a prior loan, sometimes the algorithm won't be able to pick up all of those obligations in a timely enough fashion, and the borrowers credit risk is significantly understated.

As Reuters explains:

Many online lenders have failed to detect the “stacking” of multiple loans by borrowers who slip through their automated underwriting systems, lending company executives and investors told Reuters.

The practice is proliferating in the sector – led by LendingClub, OnDeck and Prosper Marketplace – because of many lenders’ hurried, algorithmic underwriting, use of “soft” credit inquiries, and patchy reporting of the resulting loans to credit bureaus, according to online lending and consumer credit experts.

Such loopholes, they said, can result in multiple lenders making loans to the same borrowers, often within a short period, without the full picture of their rising obligations and deteriorating ability to pay.

Stacking is “causing problems with the whole industry," said Brian Biglin, chief risk officer of LoanDepot, a five-year-old mortgage lender that last year started making personal loans online.

However, even if lenders are aware of the issue, and run further credit checks, the reporting can still be sketchy enough where the risk still is not picked up properly.

In their haste to give applicants quick loan decisions – sometimes within 24 hours – some marketplace lenders do not conduct thorough credit checks, known as "hard inquiries," according to industry executives.

Such checks create an updated log of credit and loan applications, and they can lower a borrower's credit score. Soft inquiries don’t require the borrower’s consent and don't usually show up on credit reports.

OnDeck said it runs only soft checks. LendingClub and Prosper said they initially run soft checks but run hard checks later in the process, just before funding loans.

Running hard checks only at the last minute, however, can also leave other lenders in the dark, said Gilles Gade, president and CEO of Cross River Bank, which invests in many online lending platforms. At that point, the borrower may have already obtained other loans, he said, because hard checks can take about 30 days to show up on a credit report.

Another problem: Loans that never show up on credit reports at all, because of uneven reporting by online lenders.

“Not all lenders in our industry report to bureaus," said Leslie Payne, a spokeswoman for LendUp, which makes high-interest installment loans. In a February blog post, Experian, the credit bureau, said a “significant number” of marketplace lenders do not report their loans.

Prosper, Avant and LendingClub told Reuters that they report their loans to all three major credit bureaus at least monthly. OnDeck said it reports to several leading commercial credit bureaus, including Experian and PayNet.

These new revelations could scare off investors who are already concerned about the loose underwriting standards and rising default risk. As Reuters notes, some major backers such as BlackRock and Citigroup have already retreated from the space.

Firms such as Blue Elephant Capital Management stopped buying loans from Prosper for several months over concerns about weak underwriting and profitability. Brian Weinstein, CIO at Blue Elephant said that marketplace lenders need to slow their lending processes and improve sharing of credit information, adding "stacking was one of the reasons why we think we saw credit deteriorate last summer when we stopped our marketplace lending program."

Industry leaders LendingClub and Avant said they are aware of stacking and its dangers, but they downplayed the risks Reuters notes.

With the turmoil that LendingClub has been involved in as of late, namely the prompt resignation of CEO Renaud Laplanche as a result of knowingly selling $22 million in loans to Jefferies that didn't meet the agreed specifications, the last thing the firm needs is to blow up (further) because it was too nonchalant about ensuring it had a robust credit approval process.