Jun 05

Today’s News 5th June 2018

  • DARPA Rushes To Develop "Constellation Of Low-Earth Orbit Spy Satellites" Before Next Space Wars

    The Pentagon’s research arm, the Defense Advanced Research Projects Agency (DARPA), will start assessing bids this week from space industry vendors as it wants to disrupt the military space business.

    DARPA last week published a broad agency announcement (HR001118S0032) for the Blackjack program to develop and demonstrate a low earth orbit (LEO) constellation of spy satellites that provides persistent global coverage.

    DARPA recently launched the unclassified program known as Blackjack with the intent of developing low-cost space payloads and commoditized satellite buses with low size, weight, power, and cost.

    These new low-cost LEO satellites are expected to have much better capabilities compared with current spy satellites that operate at geosynchronous orbit (GEO).

    “We have pretty capable small satellites,” DARPA Director Steven Walker told reporters earlier this year. “We have been saying this for 10 years: We want to see a shift to LEO [and] get capabilities in larger constellations.”

    According to Military & Aerospace Electronics, the Blackjack program has three primary objectives:

    • “Develop payload and mission-level autonomy software with on-orbit distributed decision processors that can operate autonomously with on-orbit data processing, and perform shared tasks on-orbit;

    • Use advanced commercial manufacturing for military payloads and the spacecraft bus, including high-rate manufacturing, using commercial off-the-shelf (COTS)-like parts, reduced screening and acceptance testing for individual spacecraft, and reduced expectations for spacecraft life; and

    •  Demonstrating satellite payloads in LEO that operate on par with current GEO systems with the spacecraft at costs of less than $6 million per satellite.”

    SpaceNews said DARPA is attempting to make a smooth transition “from huge satellites in GEO to constellations of smaller and less expensive platforms in LEO.” The goal of this transition is to prepare for the coming space wars, as China and Russia have developed capabilities through direct energy weapons and missiles to destroy U.S. spy satellites.

    DARPA wants to develop military space capabilities in low-Earth orbit. (Source: SpaceNews) 

    DARPA explains how global surveillance and communications would be the primary mission for Blackjack-funded prototype constellations. The initial development and engineering work will shortly start after the winning bid is selected. In about three years time, DARPA could turn over prototype systems to the U.S. Air Force for further examination.

    The program aims to attach secret military sensors and unspecified payloads to the low-cost LEO satellite buses. Over the next three phases, DARPA plans to dish out $117.5 million in contracts to eight bus or payload suppliers.

    A DARPA spokesman told SpaceNews the agency at this stage of the program could not provide details on Blackjack.

    According to DARPA’s solicitation, space industry vendors can offer satellite buses from existing or in-development production lines as long as they can “accommodate a wide range of military payload types without redesign or retooling of the production line for each payload.”

    LEO constellation of spy satellites. (Source: SpaceNews)  

    Military & Aerospace Electronics said the goal of Blackjack is to develop a constellation of “60-to-200-satellite constellation operating at altitudes of between 310.7 miles and 807.8 miles above the Earth’s surface.”

    “One operations center will cover all government satellites and payloads, and the constellation will be able to operate without the operations center for 30 days. Blackjack payload data processing will be performed on-orbit without the assistance of ground data processing.

    The program has three phases: defining bus and payload requirements; developing bus and payloads for a two satellite on-orbit demonstration; and demonstrating a two-plane system in low-Earth orbit for six months. A future Blackjack demonstration constellation will involve 20 spacecraft in two planes with one or more payloads on each satellite.”

    At the helm of the Blackjack program is Fred Kennedy, director of DARPA’s Tactical Technology Office. Kennedy has been somewhat outspoken about the military space business and its lack of innovation. He has recently been vocal at defense conferences — criticizing the Pentagon “for embracing a culture of high performance and low risk that is now working against the military because it has given enemies ample time to develop counter-space weapons that could be used to disable or destroy U.S. satellites,” said SpaceNews.

    A space war is coming – watch President Trump has he recently pushes the idea of adding ‘Space Force’ to U.S. military. 

  • Joining Some Dots On The Skripal Case: Part 2 – Four "Invisible" Clues

    Authored by Rob Slane via TheBlogMire.com,

    Having stated in Part 1 why I believe the official story does not hold water, I want in this piece to take a look at four important aspects of the case. However, what is particularly remarkable about them is not so much the aspects themselves, but rather the fact that they seem to have been either:

    1. Ignored altogether or

    2. Quietly forgotten

    Yet in each instance they are clearly significant aspects, and so the fact that they are being ignored or forgotten, together with the official story being implausible, only goes to arouse suspicions that they may be crucial pointers to what really happened on 4th March.

    Below are four of what I would consider the most important aspects that fit into this category:

    The Invisible Mr Miller

    Three days after the Salisbury incident, the Daily Telegraph published an article which included the following details:

    “A security consultant who has worked for the company that compiled the controversial dossier on Donald Trump was close to the Russian double agent poisoned last weekend, it has been claimed. The consultant, who The Telegraph is declining to identify, lived close to Col Skripal and is understood to have known him for some time. Col Skripal, who is in intensive care and fighting for his life after an assassination attempt on Sunday, was recruited by MI6 when he worked for the British embassy in Estonia, according to the FSB, the Russian intelligence agency.”

    The security consultant, whom the Daily Telegraph declined to identify, was not only the man who recruited Mr Skripal for MI6 in 1995, but was also his “handler” in Salisbury (which was presumably the reason that Mr Skripal was settled there).

    We also know a number of other interesting facts: That the two men met regularly in a restaurant in the City; that Mr Skripal was still working for British Intelligence; and that the company that the handler was working for was Orbis Business Intelligence, the private firm owned by the ex-MI6 officer, Christopher Steele, who is said to have “authored” the so-called “Trump Dossier”.

    This is obviously all highly relevant to the case. And yet just a day after that piece appeared in The Daily Telegraph (and perhaps because of it), the British Government slapped a D-notice on all reporting in the British media of the handler and his connection to Mr Skripal. This included not naming him, but of course D-Notices only apply to domestic media, and in any case by that time CNN had in fact named him as Pablo Miller.

    All of the information above is out there in public. And yet the British Government has banned the media from discussing it further. That is indeed very odd, not least of which because the media could, if they so wished, easily use the connections between Mr Skripal, Mr Miller and Mr Steele as a reason to bolster the official narrative (I’m not saying that it would be credible, but it doesn’t take too much of a leap of the imagination to see the headlines appearing in the compliant media: “Did Putin want Skripal dead because he knew too much about the Trump/Russia collusion?”).

    Yet, the fact that there is radio silence on these connections is bound to raise questions as to their significance, and whether they point to another motive entirely behind this case.

    The Invisible People From the Market Walk

    In the first few days after the poisoning, much was made of two people who were seen walking through the Market Walk, in the direction of the bench where Sergei and Yulia Skripal were poisoned. According to the CCTV camera, this was at 15:47 on 4th March, which was approximately 16 minutes before one witness said she saw them collapsed on the park bench.

    Many reports at first claimed that this pair, seen on the image at the top of this piece, were the Skripals. Yet although the image and the brief footage is not particularly clear, what is clear is that this most certainly was not Sergei and Yulia Skripal. I am not 100% sure whether the person nearest the camera is a male or female. He/she looks very clearly female to me, but I know some people who have disagreed with this and are convinced by the way that he/she walks and his/her build, that it is a man. Yet one thing is for sure: whoever this person is, it is not Yulia Skripal.

    Of course, these two may not be important to the case at all. Yet given the next point below, I’d say that at the very least they are “persons of interest”. And yet, so far as I know, there was no ongoing call for information about who they might be, and certainly no national manhunt. If they have been found and eliminated from enquiries, the media, which had published pictures of them, had a duty to inform the public of this in a satisfactory way. Yet to my knowledge, they did not do so, but instead went very quiet about them. Indeed, if you type in some combination of CCTV, Skripals, Market Walk into a search engine, you are unlikely to find any references to them in the media after about 10th March. One might be tempted to think that their very existence has been quietly “forgotten”.

    The Invisible Red Bag

    In the CCTV footage mentioned above, the person nearest the camera, who is not Yulia Skripal, is seen carrying a red bag. This is very interesting for a couple of reasons:

    Firstly, one of the witnesses had this to say about the female she saw on the bench:

    “She was slumped over on the man’s shoulder. To be honest, I thought they might be homeless but they were perhaps better dressed. I just thought this is weird, especially as she was clearly quite a bit younger than him. She had a red bag at her feet.”

    Secondly, that witness testimony is confirmed by a rather long-range photograph which appeared in a number of places. In the Evening Standard, it is accompanied by the following caption:

    “Police put a red bag inside a police evidence bag immediately after the nerve agent attack on a Russian spy. Officers previously issued CCTV of a woman clutching a red bag.”

    The red bag is therefore a very significant piece of evidence. It was taken away by police, and the media have not mentioned it since. What was in it? Have we been told? Or has it been quietly incinerated?

    The Invisible Mr Bailey

    Another person who is a key part of the case, Detective Sergeant Nick Bailey, seems also to have disappeared. He was released from hospital on 22nd March, and a statement put out in his name included the following request:

    “I do understand and appreciate the attention on this incident, but I would ask people to put themselves in my shoes. I want to respectfully ask the media for privacy for me and my family at this time and for no intrusion into my private life, so that my family and I can try to come to terms with what has happened.”

    That seems entirely reasonable. Had I been in the same situation, I wouldn’t have wanted the media intruding.

    However, this was well over two months ago, and since then we have heard nothing from Mr Bailey. We’ve heard from Yulia Skripal, whose condition was clearly much worse than his, and who also requested that her privacy be respected in the statement released on her behalf. But we’ve heard nothing from Mr Bailey.

    Part of the reason that this is so curious is that there is one vital piece of the case that has never been properly explained. Where was he actually poisoned?

    All initial reports claimed that he was poisoned at the park bench in The Maltings. Then in a radio interview on 9th March, the former Metropolitan Police Commissioner, Lord Ian Blair, stated that he was actually poisoned at Mr Skripal’s house. That might have been the end of the matter, were it not for the fact that subsequent reports then swung backwards and forwards between the bench and the house as the place of poisoning.

    Why couldn’t they get the story straight? I mean, it must be one of the easiest parts of the whole case to establish. I’m sure that GPS tracking could throw up an answer. Or alternatively, couldn’t we just hear from Mr Bailey himself? How difficult would that be? Yet the that we haven’t heard, and that the issue has not been settled, is surely very odd indeed.

    Personally, I find it strange that he would have been called to the incident at The Maltings. He is a member of Wiltshire Police Criminal Investigation Department (CID), and for the first 24 hours there was no suspicion of a crime having taken place, it being thought that the pair on the bench had overdosed on Fentanyl. Then again, I find Lord Blair’s claim, that he was poisoned at the house, equally unconvincing. Again, why would a member of CID have gone to the house of someone who was suspected of having overdosed on a park bench on Fentanyl? A third scenario, that he was at both places, is of course even more unlikely.

    So how does one process this? Given that Detective Sergeant Bailey has not been interviewed by the media to confirm where, when and how he was poisoned; given the fact that the authorities and the media appear unable or unwilling to confirm this most straightforward of facts; and given that neither The Maltings or Mr Skripal’s house seem to be wholly plausible, both for the reason given above, but also because this raises the question of why others were not poisoned at those locations, I would submit that the most reasonable view to take – until evidence confirms otherwise – is that Detective Sergeant Bailey was poisoned neither at the bench nor the house, but somewhere else altogether.

    These are all important aspects of the case. Yet I am convinced that there is another even bigger aspect, which begins to join the dots together. I hope to discuss this in Part 3.

    *  *  *

    Some of my previous pieces on the Skripal Case:

    ♦  30 Questions That Journalists Should be Asking About the Skripal Case
    ♦  20 More Questions That Journalists Should be Asking About the Skripal Case
    ♦  The Skripal Case: 20 New Questions That Journalists Might Like to Start Asking
    ♦  The Lady and the Curiously Absent Suspect — Yet Another 20 Questions on the Skripal Case
    ♦  The Slowly Building Anger in the UK at the Government’s Handling of the Skripal Case
    ♦  The Three Most Important Aspects of the Skripal Case so Far … and Where They Might be Pointing
    ♦  A Bucketful of Novichok
    ♦  What Would Sherlock Holmes Have Made of the Government’s Explanation of the Case of Sergei and Yulia Skripal?

  • Whoever Controls The Narrative, Controls The World

    Authored by Caitlin Johnstone via Steemit.com,

    MSNBC host Joy Reid still has a job. Despite blatantly lying about time-traveling hackers bearing responsibility for bigoted posts a decade ago in her then-barely-known blog, despite her reportedly sparking an FBI investigation on false pretenses, despite her colleagues at MSNBC being completely fed up with how the network is handling the controversy surrounding her, her career just keeps trundling forward like a bullet-riddled zombie.

    To be clear, I do not particularly care that Joy Reid has done any of these things. I write about war, nuclear escalations and the sociopathy of US government agencies which kill millions of people; I don’t care that Joy Reid is or was a homophobe, and I don’t care that she lied to cover it up. The war agendas that MSNBC itself promotes on a daily basis are infinitely worse than either of these things, and if that isn’t obvious to you it’s because military propaganda has caused you to compartmentalizeyourself out of an intellectually honest understanding of what war is.

    What is interesting to me, however, is the fact that Reid’s bosses are protecting her career so adamantly. Both by refusing to fire her, and by steering the conversation into being about her controversial blog posts rather than the fact that she told a spectacular lie in an attempt to cover them up, Reid is being propped up despite this story constantly re-emerging and making new headlines with new embarrassing details, and despite her lack of any discernible talent or redeeming personal characteristics. This tells us something important about what is going on in the world.

    It is not difficult to find someone to read from a teleprompter for large amounts of money. What absolutely is difficult is finding someone who is willing to deceive and manipulate to advance the agendas of the privileged few day after day. Who else would be willing to spend all day on Twitter smearing everyone to the left of Hillary Clinton while still claiming to stand on the political left? Who else would advance the point-blank lieabout “17 intelligence agencies” having declared Russia guilty in US election meddling months after that claim had been famously and virally debunked? Who else would publicly claim that Edward Snowden’s NSA leaks did not benefit anyone besides Russia? Who else could oligarchs like Comcast CEO Brian L Roberts, whose company controls MSNBC, count on to consistently advance his agendas?

    While it’s easy to find someone you can count on to advance one particular lie at one particular time, it is difficult to find someone you can be absolutely certain will lie for you day after day, year after year, through election cycles and administration changes and new war agendas and changing political climates. A lot of the people who used to advance perspectives which ran against the grain of the political orthodoxy at MSNBC like Phil Donahue, Ed Schultz and Dylan Ratigan have vanished from the airwaves never to return, while reporters who consistently keep their heads down and toe the line for the Democratic establishment like Chris Hayes, Rachel Maddow and Joy Reid are richly rewarded and encouraged to remain.

    The disempowered want change; those in power want predictability and consistency. The more you can guarantee predictability and consistency to those in power, the more those in power will reward you.

    Those who report the news and shape public narratives are of particular interest to US oligarchs, who bought up the old media long ago and are doing everything in their power to secure influence over the new media as well. Pundits like Joy Reid are some of their most valuable assets, and they protect those assets accordingly. Because whoever controls the narrative controls the world.

    The Council on Foreign Relations is a massively influential think tank with members in the leadership of pretty much every significant media outlet in America. In late April it held a conference titled Political Disruptions: Combating Disinformation and Fake News in which a man named Richard Stengel told the audience that it is necessary for the US government to propagandize its citizens. Stengel is the former managing editor of Time Magazine, a position he vacated to go and work for the US State Department. Yes, really.

    “Basically, every country creates their own narrative story and, you know, my old job at the State Department was what people used to joke as the ‘chief propagandist’ job,” Stengel told the CFR audience.

    “We haven’t talked about propaganda… I’m not against propaganda. Every country does it, and they have to do it to their own population, and I don’t necessarily think it’s that awful.”

    You can cringe all you like, but he’s right. Not about propaganda being a legitimate weapon for an ostensibly free democracy to inflict upon its citizens of course; manipulating the way your citizenry thinks is manipulating the way they vote and organize and what they consent to, and is plainly sociopathic. But he is right that all the shrieking the US does about Russian propaganda applies fully to its own behavior.

    As we’ve discussed previously, the only real power in this world is the power to control the public narrative about what is going on. The only reason governments operate the way they operate, the only reason money works the way it works, the only reason power exists where it exists, is that we’ve all agreed to play along with some made-up mental stories about those things and pretend that they are true and real. The only thing stopping the populace from collectively deciding to change the way money works, from deciding that the assholes on Capitol Hill aren’t in charge anymore, or from deciding that every billionaire in America should be butchered like a hog and turned into Slim Jims is the fact that those ideas have not become the dominant narrative. If you can control the stories that the masses tell themselves about what is in their best interests, you control everything.

    This is why the alliance between Silicon Valley and US intelligence agencies is becoming more and more brazen. This is why Facebook and the NATO propaganda firm Atlantic Council announced that they’ve formed a partnership weeks after the Atlantic Council published an article explaining why westerners need to be propagandized for their own good. This is why social media corporations are being instructed on the Senate floor that they need to take action to silence sources of rebellion. This is why Julian Assange is being aggressively silenced by the western empire. And it is why Joy Reid still has a job.

    The good news about all this is that we know exactly where our shackles are. Our shackles are made of narrative, and the oligarchs’ ability to control it. A populist movement to disrupt establishment narratives and wake people up to what’s going on is all it will take to break our rulers’ ability to control the way the citizens of the world think and vote. From there we can make our own narratives and create a world which benefits us all and not just a few ruling elites. Right now there is a mad rush by those same elites to scale back our ability to network and share information via new media, so one of the most revolutionary things we can do at this time is prevent them from doing so and outpace them in that race.

    It isn’t the west versus Russia. It isn’t left versus right. At this time the real conflict in our society is a few ruling elites and their cronies versus humanity’s natural impulse to act in a way that is beneficial to humanity. All we need to do is help that impulse flourish, get out of our oligarchy-imposed brain boxes, and build a new world.

    *  *  *

    Internet censorship is getting pretty bad, so best way to keep seeing my daily articles is to get on the mailing list for my website, so you’ll get an email notification for everything I publish. My articles and podcasts are entirely reader and listener-funded, so if you enjoyed this piece please consider sharing it around, liking me on Facebook, following my antics on Twitter, checking out my podcast, throwing some money into my hat on Patreon or Paypal, or buying my book Woke: A Field Guide for Utopia Preppers.

  • FBI Agent In Charge Of "Russiagate" Operation And Clinton Email "Matter" To Testify Tuesday

    FBI Counterintelligence chief, Bill Priestap, will sit down for a closed-door session with lawmakers on Tuesday, according to John Solomon of The Hill.

    Priestap will be answering questions about the Hillary Clinton email case as well as the counterintelligence operation on the Trump campaign – both of which he oversaw. Priestap was the direct supervisor of Peter Strzok – the FBI agent whose anti-Trump / pro-Clinton bias was revealed after 50,000 text messages to his FBI-attorney mistress, Lisa Page, were discovered by the DOJ’s Inspector General, Michael Horowitz. 

    All accounts say that Priestap is a cooperating witness. In other words, if there’s one person who can confirm that the FBI counterintelligence operation on the Trump campaign was politically motivated – or that malfeasance occurred during the process, it’s Bill Priestap.

    Note how excited Solomon looks breaking the news of Priestap’s testimony…

    Solomon: “I think tomorrow is going to be a pivotal day. I think Congress is going to learn a lot of new information tomorrow during these interviews.” 

    Dobbs: He is going to be speaking candidly about his employer, the FBI, and those who were running the agency during that period.

    Solomon: He was very high up. Had a bird’s-eye view of everything that went on in both of these investigations. 

    While the session will be closed-door, we imagine leaks will be forthcoming as seems to be standard operating procedure these days. 

    Just who is Bill Priestap really? The Conservative Treehouse presented an in-depth analysis in February. We recommend reading this before deciding on what size popcorn to buy: 

    ***

    The game is over. The jig is up. Victory is certain… the trench was ignited… the enemy funneled themselves into the valley… all bait was taken… everything from here on out is simply mopping up the details.  All suspicions confirmed.

    Why has Devin Nunes been so confident?  Why did all GOP HPSCI members happily allow the Democrats to create a 10-page narrative?  All questions are answered.

    Fughettaboudit.

    House Permanent Select Committee on Intelligence member Chris Stewart appeared on Fox News with Judge Jeanine Pirro, and didn’t want to “make news” or spill the beans, but the unstated, between-the-lines, discussion was as subtle as a brick through a window.  Judge Jeannie has been on the cusp of this for a few weeks.

    Listen carefully around 2:30, Judge Jeanine hits the bulls-eye; and listen to how Chris Stewart talks about not wanting to make news and is unsure what he can say on this…

    https://platform.twitter.com/widgets.jshttps://platform.twitter.com/widgets.js

    …Bill Priestap is cooperating.

    When you understand how central E.W. “Bill” Priestap was to the entire 2016/2017 ‘Russian Conspiracy Operation‘, the absence of his name, amid all others, created a curiosity.  I wrote a twitter thread about him last year and wrote about him extensively, because it seemed unfathomable his name has not been a part of any of the recent story-lines.

    E.W. “Bill” Priestap is the head of the FBI Counterintelligence operation.  He was FBI Agent Peter Strozk’s direct boss.  If anyone in congress really wanted to know if the FBI paid for the Christopher Steele Dossier, Bill Priestap is the guy who would know everything about everything.

    FBI Asst. Director in charge of Counterintelligence Bill Priestap was the immediate supervisor of FBI Counterintelligence Deputy Peter Strzok.

    Bill Priestap is #1. Before getting demoted Peter Strzok was #2.

    The investigation into candidate Donald Trump was a counterintelligence operation. That operation began in July 2016. Bill Priestap would have been in charge of that, along with all other, FBI counterintelligence operations.

    FBI Deputy Peter Strzok was specifically in charge of the Trump counterintel op. However, Strzok would be reporting to Bill Priestap on every detail and couldn’t (according to structure anyway) make a move without Priestap approval.

    On March 20th 2017 congressional testimony, James Comey was asked why the FBI Director did not inform congressional oversight about the counterintelligence operation that began in July 2016.

    FBI Director Comey said he did not tell congressional oversight he was investigating presidential candidate Donald Trump because the Director of Counterintelligence suggested he not do so. *Very important detail.*

    I cannot emphasize this enough. *VERY* important detail. Again, notice how Comey doesn’t use Priestap’s actual name, but refers to his position and title. Again, watch [Prompted]

    FBI Director James Comey was caught entirely off guard by that first three minutes of that questioning. He simply didn’t anticipate it.

    Oversight protocol requires the FBI Director to tell the congressional intelligence “Gang of Eight” of any counterintelligence operations. The Go8 has oversight into these ops at the highest level of classification.  In July 2016 the time the operation began, oversight was the responsibility of this group, the Gang of Eight:

    Obviously, based on what we have learned since March 2017, and what has surfaced recently, we can all see why the FBI would want to keep it hidden that they were running a counterintelligence operation against a presidential candidate.   After all, as FBI Agent Peter Strzok said it in his text messages, it was an “insurance policy”.

    REMINDER – FBI Agent Strzok to FBI Attorney Page:

    “I want to believe the path you threw out for consideration in Andy’s office that there’s no way he gets elected – but I’m afraid we can’t take that risk. It’s like an insurance policy in the unlikely event you die before you’re 40.”

    So there we have FBI Director James Comey telling congress on March 20th, 2017, that the reason he didn’t inform the statutory oversight “Gang of Eight” was because Bill Priestap (Director of Counterintelligence) recommended he didn’t do it.

    Apparently, according to Comey, Bill Priestap carries a great deal of influence if he could get his boss to NOT perform a statutory obligation simply by recommending he doesn’t do it.

    Then again, Comey’s blame-casting there is really called creating a “fall guy”.  FBI Director James Comey was ducking responsibility in March 2017 by blaming FBI Director of Counterintelligence Bill Priestap for not informing congress of the operation that began in July 2016. (9 months prior).

    At that moment, that very specific moment during that March 20th hearing, anyone who watches these hearings closely could see FBI Director James Comey was attempting to create his own exit from being ensnared in the consequences from the wiretapping and surveillance operation of candidate Trump, President-elect Trump, and eventually President Donald Trump.

    In essence, Bill Priestap was James Comey’s fall guy.  We knew it at the time that Bill Priestap would likely see this the same way.  The guy would have too much to lose by allowing James Comey to set him up.

    Immediately there was motive for Bill Priestap to flip and become the primary source to reveal the hidden machinations.  Why should he take the fall for the operation when there were multiple people around the upper-levels of leadership who carried out the operation.

    Our suspicions were continually confirmed because there was NO MENTION of Bill Priestap in any future revelations of the scheme team, despite his centrality to all of it.

    Bill Priestap would have needed to authorize Peter Strzok to engage with Christopher Steele over the “Russian Dosssier”; Bill Priestap would have needed to approve of the underlying investigative process used for both FISA applications (June 2016, and Oct 21st 2016). Bill Priestap would be the person to approve of arranging, paying, or reimbursing, Christopher Steele for the Russian Dossier used in their counterintelligence operation and subsequent FISA application.

    Without Bill Priestap involved, approvals, etc. the entire Russian/Trump Counterintelligence operation just doesn’t happen. Heck, James Comey’s own March 20th testimony in that regard is concrete evidence of Priestap’s importance.

    Everyone around Bill Priestap, above and below, were caught inside the investigative net.

    Above him: James Comey, Andrew McCabe and James Baker. 

    Below him: Peter Strzok, Lisa Page, Jim Rybicki, Trisha Beth Anderson and Mike Kortan. 

    Parallel to Priestap in main justice his peer John P Carlin resigned, Sally Yates fired, Mary McCord quit, Bruce Ohr was busted twice, and most recently Dave Laufman resigned.  All of them caught in the investigative net…. Only Bill Priestap remained, quietly invisible – still in position.

    The reason was obvious.

    Likely Bill Priestap made the decision after James Comey’s testimony on March 20th, 2017, when he realized what was coming.  Priestap is well-off financially; he has too much to lose.  He and his wife, Sabina Menschel, live a comfortable life in a $3.8 million DC home; she comes from a family of money.

    While ideologically Bill and Sabina are aligned with Clinton support, and their circle of family and friends likely lean toward more liberal friends; no-one in his position would willingly allow themselves to be the scape-goat for the unlawful action that was happening around them.

    Bill Priestap had too much to lose… and for what?

    With all of that in mind, there is essentially no-way the participating members inside the small group can escape their accountability with Mr. Bill Priestap cooperating with the investigative authorities.

    Now it all makes sense.  Devin Nunes interviewed Bill Priestap and Jim Rybicki prior to putting the memo process into place.  Rybicki quit, Priestap went back to work.

    Bill Priestap remains the Asst. FBI Director in charge of counterintelligence operations.

    It’s over.

    I don’t want to see this guy, or his family, compromised.  This is probably the last I am ever going to write about him unless it’s in the media bloodstream. I can’t fathom the gauntlet of hatred and threats he is likely to face from the media and his former political social network if they recognize what’s going on.  BP is Deep-Throat x infinity… nuf said.

    The rest of this entire enterprise is just joyfully dragging out the timing of the investigative releases in order to inflict maximum political pain upon the party of those who will attempt to excuse the inexcusable.

    Then comes the OIG Horowitz report.

  • Dramatic Drone Footage Shows Massive Kilauea Crater Collapse, Miles Of Lava Devastation

    The number of homes destroyed in Hawaii’s Kilauea eruption has jumped to 117 from 87, according to Monday figures released by the Hawaii County Civil Defense. An estimated 20-40 homes were destroyed in Kapoho, while around a dozen people were trapped on the eastern tip of the island after fast-moving lava cut off all access to the rural community, according to spokeswoman Janet Snyder.

    Kapoho was destroyed in 1960 by a similar Kilauea eruption.

    The trapped residents ignored several days of warnings from authorities, but many have refused to abandon their homes. So far, 18 people have been arrested for trying to sneak past off-limits areas to catch a look at the oozing lava (or loot homes). 

    The Hawaii Volcano Observatory reported that Fissure 8 is continuing to feed “a large channelized flow” along Highway 132. Fissure 8 continues to be the most active, with fountains of lava shooting as high as 220 feet.

    Officials said Monday that volcanic gas emissions near Kilauea’s summit still remain high.

    Janet Babb, geologist with the U.S. Geological Survey told Fox News: “I don’t think any of us are thinking this is winding down.” -Fox News

    Sunday marks the one-month anniversary of Kilauea’s recent eruption, as ash shot 8,000 feet in the air.  USGS geophysicist Brian Shiro said that 500 earthquakes had struck near the summit over a 24-hour period. 

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    Sound warning

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    Drone footage captured at the mouth of the volcano reveals the extent of the damage caused by recent explosive eruptions: 

    Satellite data acquired by the Landsat 8 Operation Land Imager (OLI) captured the flow from the night of May 23 for this false-color image.

    Updates from Sunday:

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  • John McAfee Announces 2020 Presidential Bid "To Serve Crypto Community"

    Authored by Molly Jan Zuckerman via CoinTelegraph.com,

    John McAfee, founder of McAfee Antivirus Software and now prominent crypto enthusiast, announced his bid yesterday, June 3, to run for US president in 2020 as a way to serve the crypto community, according to his Twitter account:

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    This will be McAfee’s second run for president, after he lost his first bid in 2016 to former New Mexico governor Gary Johnson to be the candidate for the Libertarian Party.

    McAfee mentioned his past failed bid by noting yesterday that if he “been more connected with the community in 2016,” he would have been better able to publicize the idea of “currency independence,” which he notes is already on “every Anericans’ lips (sic).”

    image courtesy of CoinTelegraph

    McAfee’s tweet about his 2020 run has now garnered over 600 comments, with McAfee responding to most of them with either a “thank you” or a “:).” One token platform has apparently already donated the equivalent of $390.85 to the campaign:

    The future potential presidential candidate tweeted again today about the run, noting that although he doesn’t actually think he has a “chance of winning,” the bid will give him a platform to tell the “truth:”

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    McAfee had already made headlines last week by announcing the creation of his own crypto-backed fiat currency that is redeemable for up to 100 minutes of facetime with him, as well as in February for revealing he made $105,000 per tweet promoting crypto projects.

  • Ayatollah Calls Israel A "Cancerous Tumor"; Will Strike Back 10 Times Harder If Attacked

    Iran’s Supreme Leader Ayatollah Ali Khameni slammed Israel over Twitter on Sunday, referring to the Jewish state as a “cancerous tumor” in the West Asian region which must be “removed and eradicated.”

    “It is possible and it will happen” –Khameni

    Khamenei also said that the Palestinian cause is not “tactical” or “political” – rather it is “an issue of the heart… and faith.”

    On Saturday, the supreme leader warned “traitorous countries” refusing to confront Israel in order to appease the United States, and that “resistance is the only way to save #Palestine from oppression.”

    His tweets over the weekend came amid a tense few days along the Gaza border that saw multiple exchanges of mortar and rocket fire and violence along the security fence.

    On Friday, a 21-year-old volunteer Gazan paramedic was shot dead as she tried to help evacuate wounded protesters near Israel’s perimeter fence. UN officials condemned Razan Najjar’s killing, and thousands of Palestinians attended her funeral on Saturday. The IDF said it was investigating the incident.-Times of Israel

    Later Saturday night and early Sunday morning, Palestinian terrorist groups in Gaza resumed firing rockets over the border, shattering an official ceasefire agreement. In response, the IDF said Israeli jets carried out two rounds of airstrikes in the Gaza Strip. –Times of Israel

    Then, on Monday, Khamenei said that it would “attack 10 times more if attacked by enemies,” and that Western demands to limit its ballistic missile program are a “dream that will never come true.”

    “Tehran will attack 10 times more if attacked by enemies… The enemies don’t want an independent Iran in the region… We will continue our support for oppressed nations” -Iran’s Supreme Leader Ayatollah Ali Khamenei 

    “Young Arabs, you should take action and the initiative to control your own future … Some regional countries act like their own people’s enemies,” said Khamenei, alluding to US-allied Gulf Arab states who support the rebels trying to topple Syrian President Bashar al-Assad, a close ally of Tehran.

    Tensions are once again flaring up between Iran and the West since President Trump pulled out of the “deeply flawed” 2015 nuclear deal with Tehran. European signatories – along with Obama Secretary of State John Kerry, have been scrambling to save the accord which mandated that the Islamic Republic curb its disputed nuclear energy program in exchange for the lifting of harsh sanctions.

    One of Trump’s primary complaints about the deal was that Iran was not required to rein in its ballistic missile program, which Khamenei has repeatedly said is non-negotiable.

    “Some Europeans are talking about limiting our defensive missile program. I am telling the Europeans, ‘Limiting our missile work is a dream that will never come true.'”

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  • 4 Reasons Why The Market Is Completely Ignoring Escalating Trade Wars

    Back in March, JPM’s head quant Marko Kolanovic laid out the simplest case why despite all his bluster, angry tweets and constant puffing, Trump will not dare to engage in a full-blown global trade war which would impair the global economy and cripple capital markets. The reason: a plunge in the S&P would adversely affect the mid-term elections, potentially resulting in a big loss for the GOP and raising the threat of impeachment for Trump, should Republicans lose control of Congress. In Kolanovic’s own words:

    A significant trade war started by this administration would destabilize global equity markets. Should this happen ahead of the November election, it would impair the administration’s ‘market scorecard’ and likely lead to an election loss. Lost elections open a path to impeachment, and other complications. The game is also non-zero sum, as one can both use tough rhetoric and at the same time do little disruptive action (e.g., players as we defined them can ‘have their cake and eat it’). Setting up a diagram (similar to the well-known ‘prisoners’ dilemma’) points clearly that there will be strong rhetoric, but weak or no action that would destabilize equities.

    Then, over the weekend, Goldman took the opposite approach, inverting cause with effect, and stating that if Trump wants to win a trade war, the market has to tumble. By implication, if Trump is not willing to take said trade war to its bitter, market-adverse end, any Trumping threat will remain merely a negotiating tactic, one which America’s trade war adversaries will take increasingly less seriously, which is precisely why there is a risk that Trump may crash the market, just to prove to US trade partners that he is serious.

    The question is will Trump dare to go that far.

    The answer, according to DataTrek’s Nick Colas and increasingly, the market – is no… and is also one of the main reasons why US stocks remain resilient in the face of escalating trade tensions.

    In his latest note to clients, Colas lays out 4 specific explanations why equities remain resilient in the face of escalating trade tensions, and at the very top, just as Kolanovic said, is that the market believes there is an implicit “Trade policy put” given the president’s well-known affinity for rising equity prices.

    Other possible causes: continued strength in Tech shares, lower interest rates, and the relative strength of the US economy (and therefore stocks) versus the Eurozone and export-driven Asian countries.

    Below we represent an excerpt from Colas’ always informative and entertaining daily letter, giving 4 reasons why Trade Wars have so far been…. Meh, for the stock market.

    * * *

    The seemingly non-existent reaction of US stocks to mounting concerns of a global trade war remind me of an old Sherlock Holmes story, “The Adventure of the Silver Blaze”. That’s the one with the famous “Dog that did not bark” clue. A racehorse is stolen, his trainer murdered, all while a guard dog fails to raise an alarm. The reason: the dog knew the culprit (who was not the prime suspect) and therefore remained quiet.

    Whether legions of equity investors have a collective IQ that exceeds your typical canine is an interesting question, but too large in scope for these pages. We will therefore focus our attention on some reasons why stocks seem impervious to the “Smoot Hawley, Part 2” narrative. Here are 4 potential explanations:

    #1) President Trump is driving this process, and markets believe there is no way he consciously tanks the US equity market/economy ahead of midterm elections. Moreover, he is bucking both conventional economic wisdom and most of the Republican Party with his trade stance, leaving him fully exposed to any economic/market blowback.

    Conclusion: almost like the concept of a “Fed put”, there is an implicit “trade policy put” on current rhetoric, no matter how harsh. If all the jawboning starts to hurt US business/consumer confidence or equity prices, markets expect President Trump to back away in the proverbial “New York minute”.

    #2) Growth in US large cap Technology is powerful enough to swamp even trade fears. The S&P 500 is down 0.5% this year once you exclude the Technology sector (+11.2% YTD, and 25% of the S&P). This group moves to its own beat, and that tempo remains strong. All this comes even as Tech is the single most international group in the index in terms of offshore revenues (48%).

    Conclusion: Large Cap Tech is in a bubble, but not necessarily in terms of valuation. Rather, it is an insulating force field driven by its power to create innovative disruption and growth. Those fundamentals are now at such critical mass that even governments cannot derail them for long.

    #3) The uncertainty created by potential trade wars has been enough to halt the move to higher US interest rates, supporting equity valuations. Remember when the 10-year US Treasury seemed headed right to a 3.25% yield? That was all of 2 weeks ago. Now, problems in the Eurozone combined with trade policy concerns have pulled that yield solidly below 3%.

    Conclusion: sometimes you get a Goldilocks outcome only after you’ve eaten way too much porridge and need to take a nap. Such is the case with the trade concerns we’re talking about here. The headlines that have dampened yields aren’t what anyone would call positive for global growth or stability. But they have had the effect of stopping the selloff in US bonds, and that supports equity prices.

    #4) The economic effect of a global trade war may be worse on Europe, Japan and China than they are on the US, and global equity investors have to put their money somewhere. The recent troubles around the Italian election highlighted the still-fragile nature of the economic recovery in the Eurozone. Japanese Central Bank policy, easy as it is, has still failed to generate inflation. And China still needs US consumers to fund its expansion and continue to pull millions of its citizens out of poverty.

    Conclusion: assume we do get a full out global trade war but your investment mandate still forces you to choose between US, Japanese, European or Asian equities. Where would you go? To the export driven markets? (No.) To the regional economy still struggling with the aftermath of the Financial Crisis? (Also No.) Or to the economy running close to capacity with 2 more quarters of tax-cut fueled growth? (Yes, if reluctantly so…)

    * * *

    Summing up: US equities are threading a very fine needle with their current resilience. There’s just enough positive news (lower rates, Tech sector strength) to offset the headwinds of trade war worries. Friday’s jobs report buys some time as well, as it reinforces market confidence in the domestic economy. In the end, however, we think the “trade policy put” argument is the best explanation for recent US equity price action.

    That may be an unexpected conclusion, but to quote Sherlock Holmes, “When you have eliminated the impossible, whatever remains, however improbably, must be the truth.”

  • Manafort Tried To Tamper With Witnesses After Indictment, May Have To Return To Jail

    Paul Manafort, President Trump’s former campaign manager, has been accused of attempting to tamper with witnesses in his federal tax and lobbying case.

    Court documents reveal that Manafort tried to contact several associates after his indictment last year via phone and encrypted messaging program to get their stories straight over lobbying practices, which prosecutors say violates the terms of his release.

    They have asked a federal judge to “revoke or revise” the order governing the terms of his supervised release, which could send him to jail until his trial. Manafort is currently under 24-hour GPS monitored house arrest. 

    FBI agent Brock W. Domin wrote in court documents that one witness reported Manafort’s contact, and that he appeared to be trying to coach him on their story about where they lobbied. 

    The order reads:

    The day after the Superseding Indictment was made public, Manafort also sent Person D1 a text message on an encrypted application, stating “This is paul.” 

    Two days later, on February 26, 2018, Manafort used the same encrypted application to send Person D1 a news article describing the Superseding Indictment’s allegations concerning the Hapsburg group, which included the statement that “two European politicians were secretly paid around €2 million  by Manafort in order to ‘take positions favorable to Ukraine, including by lobbying in the United States.’” 

    One minute after sending the news article, Manafort wrote: “We should talk. I have made clear that they worked in Europe.” Toll records for one of Manafort’s  phones indicate that Manafort had a short call with Person D1 on February 24, 2018, and that Manafort attempted to call Person D1 again on February 25 and 27, 2018

    As noted in Special Agent Domin’s declaration, Person D1 has told the government that he understood Manafort’s outreach to be an effort to “suborn perjury,” because Person D1 knew that the Hapsburg group worked in the United States—not just Europe.

    Approximately five hours later, Person A switched to another encrypted application and sent a similar series of messages to Person D2, including a message relaying Manafort’s “summary” that the Hapsburg group never lobbied in the United States

    …

    Person A’s message is thus a “false story” conveyed “as if the story were true,” and an attempt “to persuade a witness to give a false account that tracked the defendant’s position.” 

    Read the entire filing below:

Digest powered by RSS Digest

Jun 04

Today’s News 4th June 2018

  • Don't Show The 'Hard-Working' Italians This Chart!!

    Rumor has it that Germans are the most disciplined workers in the world.

    The statistics, however, as Statista’s Patrick Wagner points out, give that accolade to the Indians – especially those living in Mumbai – who are apparently working much more than their German counterparts.

    To be exact almost double the time of a Frankfurtian as a study by UBS found.

    And even though people in Mumbai are working like machines, they only have an average of 10.4 days of paid vacation to enjoy.

    Infographic: Who Works the Hardest? | Statista

    You will find more infographics at Statista

    Well, at least one cliché seems to be true: Romans rather enjoy life than work extensive amounts of time over the year.

    Of course, the Italians, we suspect, will suggest they “work smart” but as a reminder, other than wartime, the last few years in Italy have been the worst for growth since Italian unification in 1861.

  • What Goes Around Comes Around In Spain

    Authored by Tom Luongo,

    Mariano Rajoy is gone from Spain’s political scene.  And good riddance.  Live by the sword die by the ballot box.  Catalan and Basque separatists took their revenge on Rajoy’s brutal crackdown on last year’s Catalan independence movement by voting with the Socialists and Podemos to oust Rajoy from power.

    The political situation in Spain has been complicated for nearly two years now as Rajoy governed with a very weak, cartel-style coalition.  It was cobbled together under duress and pressure from the European Union to not allow anti-austerity party, Podemos to take power and prevent Catalan independence.

    That was Friday.  Today the new government in Catalonia was sworn in and it looks to be just as set on seceding from Spain as the last one was.  The difference now is that EU-firster, Rajoy, is no longer in power.

    The leader of the Socialist party, Pedro Sanchez, has vowed to discuss Catalonia’s situation “government to government” which is a radical change from Rajoy’s refusal to even countenance a dialog with former Catalan leader Carles Puidgemont, who is in Germany out on bond after being arrested by German authorities at Rajoy’s request.

    Now, Spain’s political future is up in the air and at a time when hard-core populists in Italy are determined to either tear down its relationship with the EU or force it to reform bodily.

    Matteo Salvini is preparing to oust thousands of refugees.  Italian politicians are calling for Germany to leave the euro, going on the offensive against German rule over the rest of Europe.  And now, Spain’s Socialists are trying to put together a weak, minority government which thumbs its nose at Podemos after using its support to get rid of Rajoy and take power.

    Sanchez is trying to go it alone with support of around 20% of Spanish voters in putting together a cabinet.  He’s doing this to keep Brussels from lashing out at involving Podemos in the mix who will push to undo fiscal austerity policies demanded by the Troika — EU, ECB and IMF.

    But, it’s also obvious he’s willing to repay the separatists for their support.  And in this way keep everyone honest.  Brussels can’t push him too hard because he’ll simply allow the Catalans to go forth with their independence drive again this fall while also throwing domestic opponents a bone by loosening austerity policies.

    Debt Bomb, Debt Bomb

    As I’ve been saying for weeks now in relations to Italy, Brussels has almost zero leverage at this point in dealing with populist movements in Souther Europe.  None other than J. P. Morgan finally came out and admitted that this time, unlike with Greece in 2015, is truly different.

    Long story short, Italy has very few options for improving its situation by staying in the euro.  In fact, all of its incentives thanks to a strong current account surplus and discharging its obligations under TARGET 2, are to leave the euro-zone.

    This is why Paolo Savona’s saying it would be better if Germany left the euro, rather than Italy, because it highlights the underlying problem perfectly, that Germany has been sucking the continent dry through currency arbitrage.

    Germany leaving would be similar to issuing a new lira, as the euro would drop 20% overnight (at least) and that adjustment would turbo-charge the rest of Europe and begin re-balancing the scales.

    It would also assist Spain who wouldn’t benefit as much at this point from leaving the euro (see the Zerohedge article linked above) because of its less favorable foreign net investment position.

    The bottom line for both countries is simply the old adage when you owe the bank a thousand dollars it’s your problem and when you owe the bank a trillion it’s theirs.

    And the bank in question here is the ECB, and, by extension, the Bundesbanke.

    That Sanchez is trying to placate Brussels by rejecting Podemos as a coalition partner is savvy politics.  It’s saying he’s not ready to throw out the current fiscal controls, but that Rajoy’s rule was unacceptable any longer.

    It is also saying, quite explicitly, that Catalonia’s grievances with Madrid will finally get a sympathetic ear which is anathema to the EU given the potential collapse of Spain’s finances if Catalonia forms an independent state, leaving Madrid unable to meet its debt obligations.

    The Rain in Spain … Pours

    The bigger question is whether Sanchez can pull off this third way path he’s trying to choose.  He may not be able to.  Even if he cobbles together a cabinet there are real risks of his government not surviving very long.

    But, it is interesting that he’s trying to find the right balance here.  Either way, the markets are not going to look kindly on this.  Spain’s sovereign debt is going to be a problem here.

    If Sanchez forms a government he has an automatic ally in the new leadership in Italy.  And together they can truly put the screws to Brussels in a way that they haven’t been able to previously.

    It will take convincing Podemos’ leaders that the goal is to break Brussels’ hold on Spanish finances and to be patient.  I don’t know enough to know that this can work, but tactically, this is the right path.

    The new Catalan Prime Minister, Quim Torra, has already put an October 1st independence referendum on the table.  So the clock has begun ticking again.  Because if an independence-friendly government in Madrid holds serve over the next four months, the entire board state, as we gamers call it, changes completely.

    *  *  *

    To support more work like this and get access to exclusive commentary, stock picks and analysis tailored to your needs join my more than 120 Patrons on Patreon and see if I have what it takes to help you navigate a world going slowly mad. 

  • Politicizing The FBI: How James Comey Succeeded Where Richard Nixon Failed

    Authored by John D. O’Connor (the attorney who revealed Mark Felt as Watergate’s Deep Throat), op-ed via The Daily Caller,

    Comey involved the FBI in what appears to have been a plot to entrap a political opponent…

    A little over 40 years ago, Richard Nixon went from a landslide re-election winner to a president forced to resign in disgrace. Nixon’s downfall was the direct result of his unsuccessful attempts to politicize through patronage of an independent, straight-arrow FBI. The commonsense, ethical lesson from this for all government officials would be to avoid attempts to use our nation’s independent fact-finder as a partisan force.

    There is as well, of course, a more perverse lesson to be learned from Nixon’s downfall at the hands of an independent FBI, to wit: there is much power to gain by politicizing the Bureau, but only if its upper-leadership team is all on partisan board. Emerging evidence increasingly suggests, sadly, that this was former FBI Director James Comey’s leadership strategy in our country’s most sensitive investigations.

    In the years running up to the 1972 election, Deputy Associate FBI Director Mark Felt, serving under feisty bulldog J. Edgar Hoover, staunchly refused the entreaties of Nixon lieutenants to act politically, e.g., to whitewash an ITT/Republican bribery scheme and to lock up innocent war protestors. Felt, the natural successor to Hoover, fell out of White House favor as a result.

    Following the death of Hoover in May 1972, Nixon appointed in place of Felt the decent but politically malleable L. Patrick Gray. When six weeks later five burglars were arrested in the Washington, D.C. headquarters of the Democratic National Committee, Nixon’s Justice Department tried to limit, through Gray, the scope of the FBI’s investigation. Unfortunately for Nixon, regular Bureau agents, led quietly but spectacularly by Felt, fought these attempts, with a far worse result for Nixon than if the Bureau had been left alone to do its job.

    In the years running up to the 2016 presidential election, Comey made sure not to make the same “mistakes” of Felt that plagued Nixon. The IRS conservative harassment scandal was swept under the rug. The Clinton Foundation, seemingly overtly corrupt, was given a pass even after the Uranium One sale by a large Clinton Foundation donor was approved by the Clinton State Department. Comey even went so far as to take the unusual step of exonerating Hillary Clinton for her grossly negligent handling of classified materials, not a decision that was his to make. More shockingly, he permitted the destruction of 30,000 Clinton emails and relevant hard drives. It strains credulity to contend that Comey would have done the same for President Donald Trump if the occasion arose.

    Comey’s exoneration of Clinton clearly transgressed clear DOJ standards, although Comey makes a tenuous argument that this was made necessary by the clear bias of Attorney General Loretta Lynch. In so doing, though, he admits that the proper course would have been to recommend a Special Counsel. But, stunningly, he also admits in his recent book that he did not do so because the public might think she was guilty, a political calculation if there ever was one.

    Recent revelations show, chillingly, that he involved the FBI in what appears to have been a plot to entrap, and even frame, a political opponent and his campaign regarding Russian collusion. This radical politicization of the Bureau makes any Nixonian scheme seem like child’s play. Nixon shamefully tricked the FBI into doing a routine background check on his enemy, journalist Daniel Schorr. Comey outdid Nixon by a wide margin, using his FBI to construct a false case of possible treason against a political enemy.

    During the Watergate investigation, Felt sought not to frame anyone but merely to be allowed to fully pursue the bureau’s investigation, so that no one could accuse the FBI of conducting a “whitewash.” Felt and his bureau were resisting politicization, not pursuing it, even though helping the party in power, Nixon’s, would have brought accolades and perks to his leadership team.

    When, in 1972, Director Gray told Felt to “wrap up” the Watergate investigation in 72 hours, a Time magazine reporter, likely at Felt’s suggestion, called Gray inquiring about the order. Gray blew a fuse, but rescinded the order. Then when Gray and his DOJ superiors limited the Watergate prosecution to the seven originally-apprehended defendants, Felt pushed reporter Bob Woodward to explore what Felt knew to be a wider campaign of spying and sabotage. When Woodward failed to understand that to which Felt had pointed him, Felt helped the reporter understand the scheme in an all-night garage session. But raw FBI information was not leaked. Felt was not giving facts to Woodward, but teaching him how to gather facts and construct from them an overall narrative theme. The result was a series of brilliant reports which transfixed the nation.

    Felt only wanted the FBI to be free to do its job, and could not have predicted the extreme extent of the fallout from the resulting explosion. Many years later, this man of honor said he was “not out to get Nixon,” but, rather, “was only doing my job.” So to compare Felt to today’s weaving spiders in Comey’s FBI hierarchy does gross disservice to Felt and all who served with him, as well as the many honorable agents following.

    Felt lost his career – and his wife to suicide – in the tumultuous post-Watergate catharsis. Through it all, however, he retained his honor. And until the recent FBI regime of Comey, McCabe, Strzok, Page and others, there has been scant evidence of partisanship or dishonor in the FBI, as the scandal-free, effective leadership of Robert Mueller seems to corroborate. But now there has emerged simply too many highly questionable, partisan aspects of Comey’s “Russian Collusion” investigation to conclude similarly about his leadership team.

    Comey knew that the Steele dossier was opposition research trash, but premised an investigation on it. After originally failing, without the false dossier, to obtain a FISA warrant to surveil the Trump campaign, he used the Dossier to obtain FBI warrants to eavesdrop on an opponent he had admittedly loathed. Rather than separating his bureau from Steele, Comey agreed to hire him, pulling out of the deal only because Steele became vulnerable as a proven leaker and liar. Comey’s entire leadership team, including number-two man Andrew McCabe, counterintelligence chief Strzok and legal counsel Lisa Page, all seemed to have been involved in framing Trump, working with partisan CIA Director John Brennan. When Strzok was being candid with his lover Page, he later resisted joining the Special Counsel’s Russian probe because he knew “there was no there there.” Did Comey inform Rosenstein of the vacuity of the charges on which the appointment of Mueller was based? We doubt it.

    Baseless claims did not stop Comey. He tried to use the salacious allegations as leverage against Trump in his January 6, 2017 meeting with the president-elect, concealing their partisan provenance and lack of credibility. Part of the meeting’s purpose was to give DNI James Clapper a news “hook” to leak the dossier’s claims to CNN, which dutifully trashed Trump, and provided Buzzfeed an excuse to smear Trump by publishing the whole megillah. Comey then began making book on his new boss, writing four memos to use as ammunition against him in the future. But all of this, it now turns out, is not the entirety of the iceberg, as it seemed just days ago.

    It is now coming to light that the FBI was setting up Trump ever since he became a likely presidential nominee. In late 2015, Brennan embraced a false tip from Estonia that Putin was seeking to support Trump financially, and brought Comey into an ‘intra-agency” group targeting Trump. On March 21, 2016, candidate Trump met with The Washington Post editorial board, which asked about his foreign policy credentials. To bolster his team’s strength, perhaps inflationarily, he named lowly, clueless hangers-on George Papadopoulos and Carter Page as part of his team with Russian experience — literally true, but nonetheless a strenuous stretch. It was then that the entrapping forces of Comey, Clapper, and Brennan, partisans all, went to work.

    Approaches were made by “confidential human source” intermediaries to Papadopoulos, Page, Trump aides Sam Clovis and Michael Caputo, and likely others, to induce interest in Russian-hacked emails. The DOJ Number Four, Bruce Ohr, whose wife Nellie Ohr was behind the Steele Dossier, himself met with Christopher Steele.

    A member of Comey’s team travelled to England around May 2016, well before the now-asserted start of the collusion investigation, presumably to speak with either or both Steele and confidential informants. It is impossible to believe that Comey was not behind all this and, indeed, he now defends “confidential human sources” as being both necessary and in grave danger, as if being run behind the former Iron Curtain and marked for execution.

    One question to be asked is why Comey felt the need to question Papadopoulos with an undisclosed spy, using entrapping questions, when an identified FBI agent could have done the same job, at least the parts that constituted legitimate inquiry about Russian activity. The answer is, of course, that an identified FBI agent would serve, appropriately so, as a warning, not as a trap. Indeed, Comey and the team twice decided not to provide the usual “defensive briefing” given to innocent compromattargets. Apparently these partisans were more interested in entrapment than in patriotic assistance.

    If there was any doubt about the political motivation of Comey, it was removed by his rhetoric following his ouster, clothed in talk of FBI independence and ethics, but revealing raging partisan animus toward Trump. Every American has a right to political beliefs, but it hardly behooves the dignity of a former FBI Director to speak as such a nakedly partisan actor.

    Thousands of loyal, straight, politically-independent FBI personnel understand the damage Comey has done to the Bureau to which they devoted their lives in service to their country. We should all sincerely hope and pray that new FBI Director Christopher Wray will right the ship, restoring its honor and, above all, its cherished, apolitical independence.

    *  *  *

    John D. O’Connor is the San Francisco attorney who represented W. Mark Felt during his revelation as Deep Throat in 2005. O’Connor is the co-author of “A G-Man’s Life: The FBI, Being ‘Deep Throat,’ and the Struggle for Honor in Washington” and is a producer of “Mark Felt: The Man Who Brought Down the White House” (2017), written and directed by Peter Landesman.

  • Drone Killer: Chevy Trucks Now Armed With Powerful Directed Energy Weapons

    Sierra Nevada Corp. and its defense partners, Ascent Vision and RADA Technologies, have developed a mobile counter-drone system for the protection of airports, high-value targets, and for the operational use within elite units of the United States Special Operations Command (USSOCOM) on the modern battlefield.

    Last week, Sierra Nevada brought its X-MADIS (eXpeditionary Mobile Aerial Defense Integrated System) mounted on a militarized, 2018 Chevrolet Colorado pickup truck to the Special Operations Forces Industry Conference (SOFIC), which stirred up massive interest within the special operations community, said Defense News.

    Sierra Nevada, Ascentvision and RADA Technologies Inc. brought its counter-drone system to SOFIC. (Source: Sierra Nevada Corp)

    For SOFIC, the company decided to integrate the X-MADIS into the bed of a light pickup truck. Why?… Well, on the modern battlefield, or what the Army likes to call “hybrid wars,” special forces are now using nondescript, armored light pickup trucks and Polaris dune buggies in Africa and the Middle East. It is a perfect civilian cover, as the enemy tends to have difficulties identifying the vehicle from friend or foe at long distances.

    The X-MADIS features a Rada RPS-42 pMHR radar detection system, the Ascent camera system CM-202U EO/IR multi-sensor gimbal for identification, and the Sierra Nevada SkyCap counter drone Mode E-jammer. The directed energy weapon has a range of about two miles and can detect, identify, and destroy enemy drone swarms while the vehicle is traveling at a high rate of speed.

    Sierra Nevada, Ascentvision and RADA Technologies Inc. brought its counter-drone system to SOFIC. (Source: Sierra Nevada Corp)

    Sierra Nevada Corp. has been working with its partner’s Ascent Vision and the Israeli company RADA Technologies Inc. to develop the X-MADIS for the U.S. Department of Defense’s (DoD) modernization efforts to prepare for the next two decades of hybrid wars.

    Defense News said special forces are currently using the X-MADIS mounted on a Polaris Defense MRZR in an unknown location, most likely somewhere in Africa or Syria.

    Polaris Defense MRZR. (Source: U.S. Department of Defense (DoD))

    Sierra Nevada Corp. selected its partners because of their “best of breed” in critical technologies that make the direct energy weapon so effective, according to Jerry Coburn, Sierra Nevada’s director of business development, who spoke to Defense News during the show.

    “The system can detect, identify and defeat threats through EW attack while on the move at up to 50 mph,” Coburn said. The X-MADIS weapon requires just two special force operators, one driving the vehicle and the other managing the system using a tablet from within the cab of the truck.

    Defense News said X-MADIS had been successfully tested on other military vehicles, including the Polaris MRZR dune buggy, a mine-resistant vehicle, and an ambush-protected vehicle.

    “We recognize the effectiveness of the system is only as good as our knowledge of the threats that exist out there around the globe,” Coburn said. “And currently those are largely commercial off-the-shelf. But we know that our adversaries will never rest as they continue to develop their tactics, techniques and procedures and incorporate new controller technologies.” The challenge is to maintain pace with the rapidly changing drone market, Coburn added.

    At the SOFIC, there was much interest from non-DoD clients, such as law enforcement, border patrol, and other organizations that secure high-value infrastructure assets within the U.S. Next month, Sierra Nevada Corp. will participate in the SOFWERX ThunderDrone Rapid Prototyping event at Nellis Air Force Base, Nevada. SOFWERX is another special operations conference designed to help private industry and DoD organizations form relationships to test and acquire new military capabilities.

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    As for now, it seems as Sierra Nevada Corp. is taking full advantage of President Donald Trump’s enormous military spending bill that was signed in March. The DoD and its armed forces are about to get a flood of new shiny toys to deploy in the hybrid wars around the world.

  • Pepe Escobar: Why India Is Ignoring US Sanctions And Sticking With Iran

    Authored by Pepe Escobar via The Asia Times,

    It’s not just about oil – there’s a complex interconnection of geopolitics and geoeconomics between the two countries…

    Pay very close attention to what India’s External Affairs Minister, Sushma Swaraj, said after meeting with Iranian Foreign Minister Mohammad Javad Zarif earlier this week in New Delhi:

    “Our foreign policy is not made under pressure from other countries … We recognize UN sanctions and not country-specific sanctions. We didn’t follow US sanctions on previous occasions either.”

    After fellow BRICS members China and Russia, India left no margin for doubt. And there’s more; India will continue to buy oil from Iran – its third top supplier – and is willing to pay in rupees via state bank UCO, which is not exposed to the US. India bought 114% more oil from Iran during the financial year up to March 2018 than in the previous term.

    India-US trade amounts to $115 billion a year. In comparison, India-Iran trade is only $13 billion a year. India may grow an impressive 7% in 2018 and has reached a GDP of $2.6 trillion, according to the IMF, ahead of France, Italy, Brazil and Russia. To keep growing, India badly needs energy.

    So for New Delhi, buying Iranian energy is a matter of national security. Couple it with the obsession in bypassing Pakistan, and it’s clear this is all about a complex interconnection of geopolitics and geoeconomics.

    The comprehensive India and Iran partnership revolves around energy, trade and investment connectivity corridors, banking, insurance, shipping and – crucially – the imminent possibility of doing everything using the rupee and the rial, bypassing the US dollar.

    India-Iran already trade in euros – so that is step one in bypassing the long arm of the US Department of the Treasury. Both nations are still using SWIFT. Assuming the EU does not give in to the unilateral US violation of the Iranian nuclear deal, known as the JCPOA, India’s oil imports won’t be sanctioned.

    If that’s the case, step two will be turbo-charging the already booming trade in rupees and rials to the energy front – facilitated by the fact Tehran has invested in upgrading and perfecting insurance for its fleet of tankers.

    Indian Prime Minister Narendra Modi’s Hindu nationalist Bharatiya Janata Party’s (BJP) energy strategy, unsurprisingly, needs to cover all fronts; solar, wind, oil and gas. Not only is Iran central to the strategy; Central Asia also features heavily, with New Delhi eagerly expecting to import oil and gas from Turkmenistan, certainly transiting via Iran and Kazakhstan.

    New Delhi, by all means, needs plenty of access to natural gas from South Pars, the largest gas fields on the planet; either via the still ongoing Pipelineistan soap opera IPI (the Iran-Pakistan-India pipeline) or, more plausibly, an underwater pipeline from the Persian Gulf to the Indian Ocean.

    Enter the Indo-Pacific Command

    Also not surprisingly, the Holy Grail for India is Iran-related: the so far $500 million investment in Chabahar port in the Indian Ocean, as well as completing the Chabahar-Zahedan railway.

    Chabahar is the starting point of the Indian version of the New Silk Roads, linking India to Afghanistan and Central Asia, bypassing Pakistan.

    For Indian trade, a straight sea lane to Iran and then overland to Central Asia, including direct access to the mineral wealth of Afghanistan, is absolutely invaluable. A trilateral memorandum of understanding signed two years ago committed $21 billion: $9 billion for the whole Chabahar project and the rest for developing Afghan iron ore.

    If Iran, for Beijing, is a solid hub in the New Silk Roads, or Belt and Road Initiative (BRI), and an essential plank in the Eurasia integration project, Tehran is simultaneously courted by New Delhi as a counterpunch to one of BRI’s standout projects, the China-Pakistan Economic Corridor (CPEC).

    So it’s no wonder that the External Affairs Ministry in New Delhi continuously raves about the India-Afghanistan-Iran connectivity corridor, “from culture to commerce, from traditions to technology, from investments to IT, from services to strategy and from people to politics,” in the words of Swaraj.

    Washington’s counterpunch so far has been to rename PACOM – the Pacific Command, which includes India, China, Mongolia, Southeast Asia, Australia, Antarctica, in fact, the entire Pacific Ocean – as the “Indo-Pacific Command,” thus flattering New Delhi. Most of all, the move aligns with the Indo-Pacific strategy deployed by the Quad – US, India, Japan, Australia – which is a barely disguised containment of the China follow-up mechanism to the Obama administration’s pivot to Asia.

    It’s still unclear how the Trump administration might “punish” New Delhi for non-stop trading with Tehran. In the case of Russia – also under sanctions – pressure is relentless. India has been encouraged not to buy S-400 air defense systems from Russia. The excuse is not exactly subtle; that would “complicate interoperability” with US forces and “limit … the degree with which the United States will feel comfortable in bringing additional technology” into India, according to House Armed Services Committee chairman Mac Thornberry (R-Texas). New Delhi will announce its decision in October.

    The Shanghai Cooperation Organization (SCO) summit in Qingdao, China, on June 9, will be the privileged arena to discuss all these issues. Russia, China, India and Pakistan, as full members, will be there, as well as Iran and Afghanistan as current observers and, inevitably, future members. It’s clear that fellow SCO/BRICS members China, Russia and India will refuse to isolate Iran. And there’s nothing the Indo-Pacific Command can do about it.

  • Russia Set To Double Gold Mining, Becoming World's 2nd Biggest Gold Producer

    While Moscow’s selling of US Treasurys over the past 6 years is hardly a surprise to anyone…

    … Putin’s far more aggressive purchases of gold in recent years, with Russian reserves now in their 39th consecutive month of additions, have certainly raised a few eyebrows: almost as if Russia is doing everything it can to prepare for the moment when the US dollar is no longer a reserve currency.

    What is perhaps even more surprising is that the pace of gold accumulation by the state is no longer satisfactory, and according to RT, major Russian gold mining companies are planning to double production; such an increase would make Russia the world’s second largest producer of the precious metal.

    While Russia is currently the world’s third biggest gold miner after Australia and China, that could change in less than a decade, according to Mikhail Leskov, deputy CEO at the Moscow-based Institute of Geotechnology, as quoted by Vedomosti.

    The boosting of mining output would also make Russia a gold export powerhouse. In 2017, Russia extracted 8.8 million ounces, accounting for 8.3% of total global production, according consultancy Metals Focus. The newly discovered gold deposits will reportedly allow miners to increase extraction by half in seven years, and by 2030, extraction is expected to grow by nearly eight million ounces.

    Earlier this year, state exploration company Rosgeo said that a new discovery, holding some 900 tons of silver and gold, was found in the Republic of Bashkortostan. According to initial estimates, there are some 87 tons-worth of gold in the area. Silver deposits, meanwhile, are estimated at 787 tons.

    The Russian gold mining industry has almost doubled its volume of extraction over the last two decades. Over the past decade, the country’s producers mined 2,189 tons of gold according to the Russian Union of Gold Producers.

    There’s a number of major gold mining regions in Russia, including the most prospective in the world. Krasnoyarsk region in central Russia has two of major operations – Olimpiada and Blagodatnoye. Chukotka region in Russia’s Far East is home to one of the biggest Russian miners, the Dvoinoye and the Kupol operations.  The regions of Amur and Magadan are Russia’s fastest growing gold hubs while the Siberian city of Irkutsk is also one of the most prominent mining areas in the country.

    In March, the region of Yakutsk made the front pages when a Russian AN-12 cargo plane lost over 3 tons of gold on takeoff.

  • The Modern Civil War Is Being Fought Without Guns… So Far!

    Via EconomicNoise.com,

    Does our country run the risk of a civil war? Is such a horrible event even possible today?

    The answers are “Yes” and “Yes.” Furthermore, a case can be made that we are already in such a civil war.

    I received the following via email. The main piece was written by Jack Minzey, a person  I was unfamiliar with.  His take on this issue seems unique and accurate! According to him, we are already in a Civil War whether we recognize it or not.

    Here is the email:

    Recently Jack Minzey sent what was to be the final chapter in the long line of books and treatises which he had written. Jack passed away Sunday, 8 April 2018. Professionally, Jack was head of the Department of Education at Eastern Michigan University as well as a prolific author of numerous books, most of which were on the topic of Education and the Government role therein. This is the last of his works:

    Civil War

    How do civil wars happen?

    Two or more sides disagree on who runs the country. And they can’t settle the question through elections because they don’t even agree that elections are how you decide who’s in charge.  That’s the basic issue here. Who decides who runs the country? When you hate each other but accept the election results, you have a country. When you stop accepting election results, you have a countdown to a civil war.

    The Mueller investigation is about removing President Trump from office and overturning the results of an election. We all know that. But it’s not the first time they’ve done this. The first time a Republican president was elected this century, they said he didn’t really win. The Supreme Court gave him the election. There’s a pattern here.

    What do sure odds of the Democrats rejecting the next Republican president really mean? It means they don’t accept the results of any election that they don’t win. It means they don’t believe that transfers of power in this country are determined by elections.

    That’s a civil war.

    There’s no shooting. At least not unless you count the attempt to kill a bunch of Republicans at a charity baseball game practice. But the Democrats have rejected our system of government.

    This isn’t dissent. It’s not disagreement. You can hate the other party. You can think they’re the worst thing that ever happened to the country. But then you work harder to win the next election. When you consistently reject the results of elections that you don’t win, what you want is a dictatorship.

    Your very own dictatorship.

    The only legitimate exercise of power in this country, according to Democrats, is its own. Whenever Republicans exercise power, it’s inherently illegitimate. The Democrats lost Congress. They lost the White House. So what did they do? They began trying to run the country through Federal judges and bureaucrats. Every time that a Federal judge issues an order saying that the President of the United States can’t scratch his own back without his say so, that’s the civil war.

    Our system of government is based on the constitution, but that’s not the system that runs this country. The Democrat’s system is that any part of government that it runs gets total and unlimited power over the country.

    If the Democrats are in the White House, then the president can do anything. And I mean anything. He can have his own amnesty for illegal aliens. He can fine you for not having health insurance. His power is unlimited. He’s a dictator.

    But when Republicans get into the White House, suddenly the President can’t do anything. He isn’t even allowed to undo the illegal alien amnesty that his predecessor illegally invented. A Democrat in the White House has ‘discretion’ to completely decide every aspect of immigration policy. A Republican doesn’t even have the ‘discretion’ to reverse him. That’s how the game is played That’s how our country is run. Sad but true, although the left hasn’t yet won that particular fight.

    When a Democrat is in the White House, states aren’t even allowed to enforce immigration law. But when a Republican is in the White House, states can create their own immigration laws. Under Obama, a state wasn’t allowed to go to the bathroom without asking permission. But under Trump, Jerry Brown can go around saying that California is an independent republic and sign treaties with other countries.

    The Constitution has something to say about that.

    Whether it’s Federal or State, Executive, Legislative or Judiciary, the left moves power around to run the country. If it controls an institution, then that institution is suddenly the supreme power in the land. This is what I call a moving dictatorship.

    Donald Trump has caused the Shadow Government to come out of hiding: Professional government is a guild. Like medieval guilds. You can’t serve in if you’re not a member. If you haven’t been indoctrinated into its arcane rituals. If you aren’t in the club. And Trump isn’t in the club. He brought in a bunch of people who aren’t in the club with him.

    Now we’re seeing what the pros do when amateurs try to walk in on them. They spy on them, they investigate them and they send them to jail. They use the tools of power to bring them down.

    That’s not a free country.

    It’s not a free country when FBI agents who support Hillary take out an ‘insurance policy’ against Trump winning the election. It’s not a free country when Obama officials engage in massive unmasking of the opposition. It’s not a free country when the media responds to the other guy winning by trying to ban the conservative media that supported him from social media. It’s not a free country when all of the above collude together to overturn an election because the guy who wasn’t supposed to win did.

    Have no doubt, we’re in a civil war between conservative volunteer government and a leftist Democrat professional government.

    If the late Mr. Minzey is correct, it is only a matter of time before current conditions turn violent or parts of the country attempt to secede.

    The divisions are so pronounced that it is difficult to see how they are solved within the current political framework and consistent with our Constitution.

  • Malaysia Tries Crowdfunding To Repay Soaring Public Debt

    In a world where bizarre crowdfunding campaigns have become all the rage, with good samaritans even venturing to raise $30,000 so that a cash-strapped Kim Jong-Un can stay in his Trump Summit hotel…

    … a politically turbulent Malaysia, whose currency and stock market recently plunged, then spiked after a shock political outcome in last month’s election, likened by many to Trump’s unexpected presidential victory, has decided to take crowdfunding to the next level, and as the BBC reports, last Wednesday the local finance ministry resorted to an unorthodox way of raising money to pay off their country’s debt: beginning online.

    Perhaps because they felt in a “historically” generous mood after the first change in government in over 60 years, Malaysians gave nearly $2 million in the 24 hours after authorities announced a fund would be set up to raise cash.

    Sadly, the amount raised was far too little to make even the tiniest dent on the country’s massive, multi-billion-dollar debt pile, which probably means that just like the 1MDB scandal, the money will be promptly pilfered by one or more corrupt government officials, never to be seen again; however, the fundraising process did spark a social media debate about whether other countries should follow.

    The government initiative came after a 27-year-old Malaysian, who is “very much in love and proud” of her country, set up private fundraising effort that attracted interest.

    “The rakyat (people) voluntarily want to share their earnings with the government to help ease the burden,” said Finance Minister Lim Guan Eng, as he announced the fund to provide a “systematic and transparent” platform for contribution. He gave bank details where Malaysians can deposit their donations.

    Surprisingly, the fund promptly raised 7 million Malaysian ringgit ($1.8MM) in just the first day of its existence, a spokesperson at the finance ministry told the BBC, but was not able to give the overall amount to date.

    Malaysia’s Prime Minister Mahathir Mohamad

    To be sure, it wasn’t quite clear where this selfless altruism comes from, especially considering that we live in a world in which investors will line up around the block to buy Malaysia’s debt (the 10Y closed Friday at 4.195%) in exchange for a modest yield; The move was reminiscent of the late 1990s when South Koreans queued to donate wedding rings and other valuables to help their struggling economy amid Asia’s financial crisis (we doubt they will donate their bitcoin to pay down the country’s record consumer debt).

    Perhaps the impetus to pay down the national debt finds its basis in some peculiar form of patriotic transferrence; recently Malaysia’s new government, led by Prime Minister Mahathir Mohamad, who achieved a shock victory last month, said it was committed to tackling the country’s debt burden. Alternatively, Mahathir could simply track down where his corrupt predecessor, Najib Razak, parked the billions in embezzled funds from 1MBD and use that to pay down the country’s debt.

    Even that, however, won’t do much in the grand scheme of things: the government said its current debt and liabilities stand at more than 1tr Malaysian ringgit ($251 billion), roughly 80% of GDP. Analysts also said the move was unlikely to have any impact: “It’s very unlikely given the scale of debt we are looking at in Malaysia,” said Krystal Tan, Asian economist at Capital Economics. “There is a very long way to go.”

    Amusingly, several US Twitter users were quick to draw parallels, with America’s own soaring debt pile

    “With the US deficit ballooning, I wonder how long before we try this.” commented one person.

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    Well, actually it’s been tried for a long time: the US Treasury has for years had a website allowing the public to make generous, or not so generous, contributions to reduce the public debt.

    The difference is that Americans know better, and that any debt repaid will promptly disappear into some politician’s pork bill.

  • "This Is Not Going To End Well" Peter Schiff Warns The US Banking System "Has A Huge Problem"

    Via Greg Hunter’s USAWatchdog.com,

    Money manager Peter Schiff says even though Deutsche Bank is the most systemically dangerous bank in the world (according to the IMF), that is just the tip of severe global financial problems.

    Schiff explains, “I think it’s a problem, and it’s not just Deutsche Bank.

    “Deutsche Bank could be the weak link of a chain. If you remember back to when we had the financial crisis (2008). First, you had the sub-prime mortgages blowing up, and everybody was like don’t worry about it. It’s contained. I said it’s not contained, it’s just showing up first in the sub-prime market because these are the weakest mortgages.

    The entire mortgage market has a problem.  I think the banking system has a huge problem because it’s lived off of the life support of artificially low interest rates. As that is removed, it’s like pulling the plug off of someone who has lived off life support. The irony is you have so many analysts that think higher rates are good for the banks…

    Low interest rates saved the banks, Schiff notes, but points out the hypocrisy of current market thinking:

    “You can’t have it both ways. It can’t be low interest rates helped the banks, and high interest rates will help the banks. It’s one or the other. I think higher interest rates are going to crush the banks. I think it’s going to destroy the value of their loans and their collateral. It’s going to lead to defaults…

    All those banks that were too big to fail in 2008 are much bigger now, and it’s going to be a lot more difficult to bail them out.”

    Schiff issues a stark warning,

    “This is not going to end well, and I don’t think the Fed is going to be able to save us again. If you get it wrong this time, you’re done. You are down for the count.

    You just can’t hold and hope. If the stock market gets cut in half again, the Fed is not going to bail you out with another round of quantitative easing.

    They’re not going to bail you out with rate cuts because the next time the Fed tries to do that, it will destroy the dollar. I am confident of that. The next time is the last time. We will have a dollar crisis and a sovereign debt crisis.

    Then the U.S. can’t bail anybody out because it’s the U.S. that is in trouble. It will be the U.S. debt that nobody will want to own. It’s the U.S. dollar that nobody wants to own. Whatever the paper profits that people have because they have been in this bull market the last number of years, none of it is going to matter. The profits are going to go up in smoke as the market implodes.”

    What about gold in a rising rate environment? Schiff says,

    “Gold can go up when rates are rising. In fact, gold will go up when rates are rising. Rates are generally rising because you have more inflation. More inflation is good for gold.”

    Join Greg Hunter as he goes One-on-One with Peter Schiff, founder of Euro Pacific Capital.

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Jun 03

Today’s News 3rd June 2018

  • Hawaii Volcano Update: Scientists Baffled Over Mysterious Cracks In Kilauea Crater

    Four weeks into its eruption, Hawaii’s Kilauea volcano continues to spew molten lava across The Big Island’s East side – cutting off access to more neighborhoods and destroying 87 homes, ten of which happened in the last two days. 

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    Scientists are also baffled after aerial drone footage showed concerning changes within Kilauea’s main summit crater – including unexplained cracks at the bottom which are spewing hot steam. Concerns have been raised that an “expanding collapsed crater” and debris blocking the vent could trigger a massive new explosion. 

    The Halema‘uma‘u crater has undergone a sudden transformation since the eruptions began in early May, including the surprising disappearance of a lava lake.

    The drone footage from the US Geological Survey (USGS) shows “yellow sulfur substance on the rubble-covered floor and a scattering of large ballistic blocks around the crater rim”.

    USGS officials revealed that the empty vent once housed a 12-acre lava lake up until a few weeks ago. –Express.co.uk

    What happens next is unknown:

    “It’s possible that new explosions will blast through the rubble at the bottom of the vent, and these may or may not be larger than previous explosions,” said USGS geophysicist Kyle Anderson. “It’s also possible that the vent could become permanently blocked, ending the explosions entirely.”

    The steady collapse of the crater’s internal walls due to draining magma has also enlarged the mouth of the vent considerably – which has grown from 12 acres to 120 acres. The summit itself has also sunken at least five feet in elevation while magma levels continue to drop. 

    Meanwhile, Hawaii’s Highway 137 has been blocked by lava, cutting off access to Kapoho, Vacationland, Hwy 132 and possibly the Puna Geothermal power plant. 

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    (via @MalikaDudley, HawaiiNewsNow)

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    Officials at the Puna Geothermal Ventrue (PVG) have confirmed that lava is covering the plant’s monitoring station, however the Department of Health is monitoring for unsafe levels of hydrogen sulfide with none detected thus far.

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    That said, plant employees may have just lost their access in and out of the facility, as a Friday Instagram update from PVG reads “if lava crosses Highway 137 then they could lose their only way in and out of the plant.“

    Puna Geothermal Venture officials confirm lava from the fountaining fissure 8 in Leilani Estates continues to flow across the property — cutting across the main driveway to the plant facility. Mike Kaleikini, the company spokesperson, confirms a substation and a warehouse that stored a drilling rig have burned. He also says two wells have been covered on Well Pad E and a lava made contact with another, Well Pad A, but never passed across it. He says all 9 quenched wells and the two plugged wells are “holding up without any issues” — and confirms there has been no detected release of hydrogen sulfide.

    According to Kaleikini, the monitoring station at PGV was covered by lava — so they are depending on the handheld machines their employees are using to check for hydrogen sulfide levels along with the monitors the Department of Health have installed around the area. Kaleikini says the plant is no longer being staffed 24/7, but personnel is on site every day. According to Kaleikini, even though the main driveway to the plant is blocked, there is still an alternate route available. However, if lava crosses Highway 137 (Government Beach Road) then they could lose their only way in and out of the plant. According to Ormat, which owns Puna Geothermal Venture, the company has insurance of up to $100 million in the case of eruptions and earthquakes — but it’s not clear if that will cover everything. Ormat says significant damage or an extended shut-down could have an adverse impact on business. Last year, Puna Geothermal brought in about $11 million in net income. –Instagram

    A Hawaii National Guard sergeant monitors air quality as lava crosses Pohiki Road on Thursday. (Anthony Quintano/Civil Beat)

    What’s it like to monitor the ongoing events surrounding the Kilauea eruption? USGS Geologist Matt Patrick explains in this video worth watching fullscreen. 

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    Meanwhile, video has emerged of Hawaiian hothead John Hubard, 61, pulling a gun at 32-year-old neighbor Ethan Edwards on Tuesday, firing a shot at the sky on before aiming his gun at the man. Hubbard has been arrested. 

    When the shot goes off, people can be heard yelling out and Edwards can be seen crouching and covering his head with his arms as Edwards aims the gun at him.

    “Are you kidding me? Stop!” people can be heard yelling in the background.

    Hubbard tells his neighbor to “Get the f–k out of here” as Edwards, who is walking away with his hands up, screams back “I live here!” repeatedly.

    “Happy to be alive,” Edwards wrote in the video’s caption. “Be careful out there folks. This situation is really beginning to take its toll psychologically and the bad weather is contributing to emotional tensions. Folks are breaking down.” –NY Post

    Many evacuees are now living in emergency tents as local residents provide food and supplies.

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  • "Real" Assassin Arrested In Staged Kiev Hit Linked To Ukrainian Intelligence As Official Story Unravels

    The Ukrainian government’s staged assassination of anti-Putin journalist Arkady Babachenko has taken an even stranger turn, as evidence has emerged that his would-be “Russia-ordered” assassin and the man who supposedly hired him, both say they worked for Ukrainian counterintelligence, casting serious doubt on the official story.

    To review, Ukrainian authorities announced last Tuesday that Babachenko had been assassinated after returning home from the store. On Wednesday, Babachenko appeared at a press conference with Ukrainian authorities who said that the faked assassination was an elaborate sting to bust an actual hit planned by Russia. 

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    Only now we find that the hitman, Oleksiy Tsimbalyuk, is an outspoken critic of Russia who says he worked for Ukrainian counterintelligence – a claim Ukraine initially denied but later admitted to be true. Meanwhile the guy who supposedly hired Tsimbalyuk, Boris L. German, 50, also says he worked for Ukrainian counter-intelligence, a claim Ukraine denies as its immediately destroys the carefully scripted, if rapidly imploding, Ukrainian narrative meant to scapegoat Russia for what has been a “fake news” story of epic proportions, emerging from the one nation that not only was the biggest foreign donor to the Clinton foundation, but has made fake news propaganda into an art form.

    Supposed “hitman” Oleksiy Tsimbalyuk

     

    Boris German, suspected of organizing an attempted hit on anti-Putin Russian journalist Arkady Babachenko sits in a cage during trial in Kiev, Ukraine

    The New York Times reports that Tsimbalyuk – a former Russia-hating priest was featured in a 10-minute documentary in January 2017 in which “he called killing members of the Russian-backed militias in eastern Ukraine “an act of mercy”, further calling into question why Russia would hire him for the supposed assassination in the first place. 

    Facebook pictures also reveal Tsimbalyuk wearing a Ukrainian ultranationalist uniform from “Right Sector,” a group deemed to be neo-Nazis.

    As even the Russophobic NY Times puts it: 

    Given such strong and publicly avowed enmity toward Russia, it is odd to say the least that Mr. Tsimbalyuk would be selected to carry out the contract killing of a prominent Kremlin critic.

    German claims he took orders from Moscow businessman Vyacheslav Pivovarnik – who he says works for one of Putin’s personal foundations. 

    Ukrainian officials also claim that German has a list of another 30 targets which Moscow wants to wipe out – something he claims he has since passed onto Kyiv.

    Prosecutors claimed German had been given a down payment of $15,000, half what he was promised for carrying out the hit.

    German said: ‘I got a call from a longtime acquaintance who lives in Moscow, and in the process of communicating with him it turned out that he works for a Putin foundation precisely to orchestrate destabilization in Ukraine.’ –Daily Mail

    “Six months ago, my old acquaintance contacted me, an ex-citizen of Ukraine, now living in Moscow,” German told a Ukrainian court, adding “He works in a personal foundation of Putin’s – and is in charge of organizing riots in Ukraine and planned acts of terror at the next presidential elections. He is called Vyacheslav Pivovarnik. This is not a fairy tale, there’s nothing mystical here, everything has been proved.”

    German’s lawyer Eugene Solodko wrote on Facebook that his client was an executive director of Ukrainian-German firm Schmeisser – the only non-state owned arms producer in the country. 

    Russia has denied German’s claim, with a Putin spokesman saying “No such foundation exists in Russia. Any allegations about Russia’s possible complicity in this staging is just mudslinging. They do not correspond to reality.”

    Meanwhile, senior Ukraine officials have been on the defensive since Wednesday, when the head of security services announced they had staged the death of Babchenko so they could track his would-be killers to Russian intelligence, a story the International Federation of Journalists slammed as idiotic, nonsensical and completely undermining Ukraine’s credibility.

  • Kim Jong-Un Can't Afford To Pay For His "Singapore Summit" Hotel Room

    Trump managed to do what no other US president has ever achieve, in getting North Korea’s president Kim Jong Un to sit down and negotiate the country’s denuclearization. And now comes the hard part: paying for Kim Jong Un’s hotel in Singapore, the location of the historic June 12 summit.

    Because while US event planners are working day and night with their North Korean counterparts to set up a summit designed to bring an end to Pyongyang’s nuclear weapons program at an island resort off the coast of Singapore, a rather “awkward” logistical issue has emerged: who’s going to pay for Kim Jong Un’s hotel stay?

    As the Washington Post reports, the “prideful but cash-poor pariah state” has demanded that a foreign country foot the bill at its preferred lodging: the Fullerton, “a magnificent neoclassical hotel near the mouth of the Singapore River, where just one presidential suite costs more than $6,000 per night.”

    While it’s not just the bill… 

    The mundane but diplomatically fraught billing issue is just one of numerous logistical concerns being hammered out between two teams led by White House Deputy Chief of Staff Joe Hagin and Kim’s de facto chief of staff, Kim Chang Son, as they strive toward a June 12 meeting.

    … who pays the room and board has emerged as the biggest point of contention ahead of the June 12 summit.

    In other words, North Korean dictators beggars can be choosers, and the one who is set to quietly foot the North Korean’s hotel bill is none other than the real estate mogul himself: Donald Trump.

    But it may not be so simple, as potential diplomatic complications have emerged associated with paying for Kim’s hotel room, and as the WaPo adds when it comes to paying for lodging at North Korea’s preferred five-star luxury hotel, the United States is open to covering the costs, but it’s mindful that Pyongyang may view a U.S. payment as insulting.

    So, in order to avoid offending the rotund dictator, U.S. organizers are considering asking Singapore, the host country, to pay for the North Korean delegation’s bill.

    “It is an ironic and telling deviation from North Korea’s insistence on being treated on an ‘equal footing,’ ” said Scott Snyder, a Korea expert at the Council on Foreign Relations.

    “These norms were laid in the early 2000s, when Seoul’s so-called sunshine policy took off,” said Sung-Yoon Lee, an expert on Korea at Tufts University, referring to a policy of rapprochement associated with former South Korean president Kim Dae-jung. “North Korea can build nukes and ICBMs, but claim they are too poor to pay for foreign travel costs.”

    This is not the first time the poor communist nation has made bold monetary demands: In 2014, when then-U. S. Director of National Intelligence James R. Clapper Jr. visited North Korea to retrieve two prisoners, his North Korean hosts served him an “elaborate 12-course Korean meal,” the veteran intelligence official said, but then insisted that he pay for it.

    Meanwhile, if the US ends up paying the bill it will only add to Trump’s already long list of questionably fund flows as any payment for North Korean’s accommodations would run afoul of Treasury Department sanctions, accoridng to Elizabeth Rosenberg, a former Treasury official. The transaction would require the Office of Foreign Assets Control to “temporarily suspend the applicability of sanctions” through a waiver, she told the WaPo.

    “There are legitimate mechanisms built in for exemptions depending on the circumstance, but this could run into public and political criticism and send the wrong message to North Korea,” said Duyeon Kim, a visiting fellow at the Korean Peninsula Future Forum, a nonpartisan think tank in Seoul.

    In the worst case, there is always reimbursement by bitcoin: after all this is precisely the contingency for which the cryptocurrency was created.

    * * *

    But wait, there’s more. It turns out that figuring out how to pay Pyongyang’s hotel tab could be just the beginning in dealing with the poor country’s logistical problems. Another problem is that the country’s outdated and underused Soviet-era aircraft could require a landing in China because of concerns it won’t make the 3,000-mile trip, “a visit that would probably require a plausible cover story to avoid embarrassment.”

    As for Trump’s own plans, he is expected to stay at the Shangri-La, a 747-room hotel that is accustomed to high-security events, and which hosts the annual Shangri-La Dialogue, a security conference that attracts dozens of ministers of defense and state.

    Finally, there is the question of what will actually be said at the summit itself.

    What we do know, is that the two sides have settled on the venue for the June 12 meeting: the Capella hotel on the resort island of Sentosa, is situated off Singapore’s southeast coast; it boasts a mix of colonial-style buildings and curvy modern edifices.

    What is less known is what will actually take place at said summit: White House and State Department officials repeatedly declined to comment on the advance team planning, keeping those discussions more opaque than the substance of the negotiations.

    Rexon Ryu, a former White House official who dealt with the North Korea nuclear issue, said the North Korean side in particular has an interest in keeping those discussions quiet.

    “These talks go to the question of security, and if anything, that’s probably most immediately paramount to Kim,” he said. “I think for many folks on the North Korean side, this is more important than the content of the negotiations.”

    * * *

    PS: it was inevitable.

  • JPMorgan's Stunning Conclusion: An Italian Exit May Be Rome's Best Option

    With Europe having a near heart attack last week, as Italian bond yields exploded amid deja vu fears that the new populist government would press the “Quitaly” button and threaten the EU with exiting the Eurozone in order to get budget spending concessions from Brussels, the discussion about Europe’s record Target2 imbalances quietly resurfaced after years of dormancy. And with €426BN, Italy has the highest Target2 deficit with the Eurosystem (Spain is a close second with €377BN) any discussion about an Italian euro exit raises concerns about costs.

    After all, as JPMorgan reminds us, it was only a year ago, in January 2017,  that in a letter to European Parliament MPs, ECB President Draghi made the stunning admission that a country can leave the Eurozone but only if it settles its bill first,  or as Draghi said “if a country were to leave the Eurosystem, its national central bank’s claims on  or liabilities to the ECB would need to be settled in full.”

    By linking the Eurozone exit cost to Target2 balances, where Germany is on the other end with a receivable balance of nearly €1 trillion, Draghi “reminded” populist politicians in Europe that a euro exit or divorce would be difficult and even more costly relative to the past because of the continued rise in Target2 balances following the ECB’s QE program.

    As the chart below shows, and as we and the BIS have discussed previously, due to QE induced cross border flows since 2015, Target2 balances have exploded since the launch of the ECB’s QE (and third Greek bailout in 2015), and surpassed the previous extremes from the depths of the euro debt crisis in the summer of 2012.

    Here, it is worth noting that as the BIS explained last year, the Target2 balance deterioration since 2015 is different in nature than that seen during 2010-2012, it is not a merely technical consequence of QE but a reflection of investors’ preferences. At the time, during the 2010-2012 euro debt crisis period, the Target2 balance deterioration was driven by a loss of access to funding markets, inducing banks in peripheral countries to replace private sources of funding with central bank liquidity. However, since 2015 the rise in Target2 balances is more the result of the cross-border flows induced by investors’ response to QE. As JPM explains, “for example when the Bank of Italy, via its QE program, buys bonds from a German bank or a UK bank with an account in Germany, this flow causes a rise in Bank of Italy’s Target2 deficit and an increase in Bundesbank’s surplus. Or when the Bank of Italy buys bonds from a domestic investor but this domestic investor uses the proceeds to buy a foreign asset, then the Bank of Italy also builds up its liability with the Eurosystem. In both cases, the liquidity created by the Bank of Italy’s QE program does not stay within Italy, but leaks out to Germany or other jurisdictions.“

    Additionally, according to the ECB, the vast majority of bonds purchased by national central banks under the QE were sold by counterparties that are not resident in the same country as the purchasing national central bank, and roughly half of the purchases were from counterparties located outside the euro area, most of which mainly access the Target2 payments system via the Deutsche Bundesbank. In other words, due to investors’ preferences, the excess liquidity created by the ECB’s QE program since 2015 did not stay in peripheral countries, but leaked out to creditor nations such as Germany, which got flooded with even more liquidity.

    Incidentally, this is precisely the opposite of what Mario Draghi described to policymakers and the general public was the stated intention of the ECB’s QE, which was meant to boost the periphery, not the core, as it was already benefiting thanks to the Euro’s fixed rate, effectively subsidizing core European exporters at the expense of peripheral nations desperate for external, or currency, devaluation.

    In any case, the different nature of the Target2 balance deterioration since 2015 does not change that the fact that Target2 liabilities still represent a cost for a country exiting the euro, assuming of course that country intends to satisfy its unwritten contractual obligations.

    In other words, Target 2 balances represent national central banks’ claims on or liabilities to the ECB that, according to Draghi, would need to be settled in full, and thus represented leverage that the Eurozone had over any potential quitters.

    But, as JPM notes, this is where the controversy arises, because what if a departing country – most likely about to default on its external liabilities and already set to redenominate its currency – reneges on its Target2 liability? After all, not only are those intra-Eurosystem Target2 claims and liabilities uncollateralized, but any exiting country would have little to lose by burning all bridges with Europe when it gives up on using the “common currency.”

    In this case, a euro exit by a debtor country would represent more of a cost to creditor countries such as Germany rather than to the exiting country itself. And, as shown in the chart above, Germany sure has a lot of implicit accumulated costs, roughly €1 trillion to be precise, as a result of preserving a currency union that allowed German exporters to benefit from a euro dragged lower by the periphery, relative to where the Deutsche Mark would be trading today.

    But here the analysis gets slightly more complex, as Target2 does not provide the full picture of potential costs (or benefits, assuming a scorched earth approach).

    As JPMorgan writes, the Target2 liabilities of a debtor country give only a partial picture of the cost to creditor  nations from that debtor country exiting. This is because Target2 balances represent only one component of the Net International Investment Position of a country, i.e. the difference between a country’s total external financial assets vs. liabilities.  The broader metric that one must use, is of the Net International Investment Position for euro area countries and is shown in the chart below. It shows that contrary to the Target2 imbalance, Italy leaving the euro would inflict a lot less damage to creditor nations than Spain leaving the euro.

    This is because Spain’s net international investment liabilities stood at close to €1tr as of the end of last year, almost three times as large as its Target2 liabilities. In contrast Italy’s net international investment liabilities were much smaller and stood at only €115bn at the end of last year, around a quarter of its €426bn Target2 liabilities. This, as JPM explains, is because Italy has accumulated over the years more external assets than Spain and should thus be overall more able to repay its external liabilities.

    In other words, while gross external liabilities are similar in Italy and Spain, from a net external liability point of view, an Italian euro exit should be a lot less threatening to creditor nations than a Spanish euro exit. That said, the assets and liabilities are not necessarily owned and owed by the same parties, meaning that one cannot ignore the nearly €3tr of gross liabilities of Italian residents to foreign residents.

    Ironically, the surprisingly low net international investment liabilities of Italy are the result of the persistent current account surpluses the country has been running since the euro debt crisis of 2012, and smaller current account deficits compared to Spain before the crisis. The flipside is that the current account surplus – in theory – also makes it easier for a country like Italy to exit the euro relative to a current account deficit country. This is because the higher the current account deficit of a debtor country, the higher the cost of an exit for this country as the current account deficit would have to be closed abruptly following an exit. Similarly, the higher the current account surplus of a creditor country, the higher the cost of an exit, due to a potentially higher currency appreciation. On this metric Italy sits roughly in the middle as shown below.

    Most importantly, this means that as a result of Italy’s decent current account surplus, from a narrow current account adjustment point of view, its own cost of a euro exit should be relatively small.

    And it’s not only Italy. What is remarkable in the chart above is that, with the exception of Greece, all peripheral countries were running current account balances last year, a huge change from the large current account deficits of 2009-2010 before the emergence of the euro debt crisis. This is also shown in the next chart, which depicts this significant adjustment in the savings position of peripheral countries which effectively converged to that of core countries.

    Besides Target2 and the current account, another important reflection of the improvement in the savings position of peripheral countries has been what JPMorgan calls the “domestication” of their government debt. On one hand, this represented by the sharp decline in foreign banks’ exposure to Italian debt.

    The offset, of course, is that as foreign banks dumped their Italian exposure, one particular hedge fund stepped up and bought it all: the European Central Bank, and in doing so, it presented Rome with even more leverage over the ECB, which ironically is headed by an Italian.

    1

    Furthermore, the next chart shows that the domestication of Euro area government bond markets has been even more acute for peripheral banks, whose share of non-domestic non-MFI bonds has been hovering close to 15% in recent years vs. a peak of close to 40% in 2006.

    Here, JPMorgan points out one curious implication from these government bond market ownership trends, which is often overlooked: debt relief via Private Sector Involvement (PSI) becomes a less attractive option for an indebted peripheral country when most of the bonds are held domestically.  In other words, it is less practical to default on your sovereign debt if you are screwing far fewer foreign creditors, and most impairing your own population.

    As JPMorgan puts it, “this narrows the options that a country has in terms of adjusting its economy within a monetary union.“

    Here some big picture observations: within a monetary union, where currency depreciation and debt monetization are not possible – unless of course, there is divorce with said union – a country has effectively two options: default and internal devaluation.

    Greece, for example,  has tried both: default via the Private Sector Involvement of 2012 and internal devaluation – i.e., collapsing wages, rising current account – via the Troika’s ongoing adjustment program.

    And here things get interesting, because according to JPM calculations, the various Greek defaults, also known technically as Private Sector Involvements, provided a net debt relief to Greece of around €67bn or 33% of GDP (even though Greek debt/GDP still remains stratospheric and, as the IMF will remind on regular occasions, is unsustainable.

    Applying the same haircut and PSI assumptions (i.e. only general government bonds are subjected to haircuts), the net debt relief to Italy from haircuts on non-domestic holders would be only €267bn or 15% of GDP. In other words, such a cost/benefit analysis of an effective default debt haircut suggests that a Greek-style PSI would be rather unattractive for Italy. Of course, one could imagine a wider restructuring than the Greek PSI, e.g. by including loans and regional or local government debt, but surely such an option would be more difficult to negotiate or keep voluntary and would present greater legal challenges. There are, of course, other far more structural challenges, namely that it is virtually impossible that what worked for Greece, will never work for Italy, where the associated numbers are orders of magnitude higher.

    So with little to gain from a default, as indicated in the above analysis, Italy is left with just one adjustment option: internal devaluation. Unfortunately, as JPM calculates, this internal devaluation is not tracking well in the case of Italy. This can be seen in the chart below, which shows the changes in unit labor costs, current account balances
    and unemployment rates since 2009.

    It also shows that Greece and Ireland have made the biggest adjustment so far, i.e. biggest decline in unit labour costs and current account deficits, while Italy has instead seen a rise in unit labour costs since 2009. In other words, ten years since the Lehman crisis and six years since the euro debt crisis and Italy’s labour cost adjustment has not even begun, and if it does, it is safe to say that Rome faces a political crisis the likes of which it has not seen in a long time.

    Putting this all together, the lack of any internal devaluation so far and the unattractiveness of a Greek style PSI leave limited options to Italy to adjust within the monetary union.

    This, coupled with Italy’s massive Target2 imbalance which becomes an instant asset the moment the country decides to exit the Eurozone and never repay it much to the chagrin of Mario Draghi, together with a decent current account surplus – one which would only soar should Italy revert to the lira supercharging the country’s exports, which as explained above reduces the own cost of exiting the euro from a narrow current account adjustment point of view, will likely continue to make the country vulnerable to populist pressures to exit the monetary union.

    That is the gloomy, if stunning, JPMorgan conclusion, although as a hedge, the bank also notes that the road to Quitaly, as the Greek fiasco in 2015 showed all too clearly, would be anything but easy and neither Brussles nor the ECB would go down without a fight. JPMorgan also notes that the above take also ignores other potential costs from an exit highlighted by the market reaction this week, such as the possibility that it could trigger a broader crisis and, if the Greek script is repeated, capital controls.

    Then again, if Italy ever got to the point where lines of panicked depositors form outside Italian banks a la Greek summer of 2015, one can wave goodbye to the euro and the European experiment.

  • Here's Where Californians Are Moving To Escape Skyrocketing Prices

    A new report using property searches and census data from realtor.com reveals which states Californians are moving to when they realize that a $1.4 million McMansion on 1/16th of an acre while staring into their fat neighbor’s bedroom window just isn’t all it’s cracked up to be. 

    Silicon Valley residents in particular are leaving in droves – more so than any other part of the state. Nearby San Mateo County which is home to Facebook came in Second, while Los Angeles County came in third.

    “They’re looking for affordability and not finding it in Santa Clara County,” said Danielle Hale, chief economist for realtor.com.

    A tight housing supply combined with nearly a decade of exploding home values have pushed housing prices and rents through the roof. Take, for example, this 848 square foot home on Plymouth Drive in Sunnyvale, CA (which in the 90’s was the “poor” part of town vs. nearby Mountain View and Los Altos). 

    After being listed in March for $1.45 million, it sold within 48 hours for $2 million, or $2,358 per square foot. With Sunnyvale’s 1.25% property tax, the new owners are paying $2,083 per month, or $250,000 every 10 years. 

    The housing crunch has inspired a flurry of state legislation designed to boost new home construction and eventually lower prices, “including a sweeping proposal to add millions of homes by public transit. It died in April, but its author, Sen. Scott Wiener, D-San Francisco, has vowed to try again next year,” writes Kathy Murphy in the Mercury News.

    As Michael Snyder of the Economic Collapse Blog pointed out in May…

    Reasons for the mass exodus include rising crime, the worst traffic in the western world, a growing homelessness epidemic, wildfires, earthquakes and crazy politicians that do some of the stupidest things imaginable.  But for most families, the decision to leave California comes down to one basic factor…

    Money.

    It’s not just housing prices driving the exodus, of course. Punitive taxes – more than twice as much as some other states, are eating away at disposable income. Nearby Arizona’s income tax rate is 4.54% vs. California’s 9.3%, while the new tax bill may accelerate the exodus.

    As Snyder notes:

    “But now the new tax bill has made some major changes, and some experts believe that this will actually accelerate the exodus out of the state of California.  The following comes from CNBC…”

    In an op-ed in the Wall Street Journal headlined “So Long, California. Sayonara, New York,” Laffer and Moore (who have both advised President Donald Trump) say the new tax bill will cause a net 800,000 people to move out of California and New York over the next three years.

    The tax changes limit the deduction of state and local taxes to $10,000, so many high-earning taxpayers in high-tax states will actually face a tax increase under the new tax code.

    So where are people going?

    The top destination for Bay Area residents is either a cheaper part of the state such as Alameda, Sacramento, San Juaquin or Placer counties, where homes can be found for $500K – $894K less than Santa Clara. Silicon Valley residents heading out of state are setting up camp in Arizona, Nevada, Idaho and Texas. 

    And as South Bay Silicon Valley residents in particular are flocking to nearby Alameda County – one of the top destinations for in-state moves, Alameda County residents are being pushed further east to lower-cost Contra Costa, San Juaquin, Sacramento and Placer counties. 

    Meanwhile, the median home price in Sacramento County — $357,000 — has risen each month for the past six years, the Sacramento Bee reported last week, jumping by 12 percent in the past year. –Mercury News

    Here are the top 10 California counties that people are leaving, and where they’re headed... (realtor.com via the Mercury News.)

    1. Santa Clara County

    Out of state destinations: Arizona, Nevada, Texas and Idaho

    In state destinations: Alameda, Sacramento, San Joaquin, Santa Cruz and Placer counties

    2. San Mateo County

    Out of state destinations: Arizona, Nevada, Texas and Washington

    In state destinations: Alameda, Contra Costa, Santa Clara, Sacramento, and San Francisco counties

    3. Los Angeles County

    Out of state destinations: Nevada, Arizona, and Idaho

    In state destinations: San Bernardino, Riverside, Ventura and Kern counties

    4. Napa County

    Out of state destinations: Arizona, Idaho, Nevada, Florida and Oregon

    In state destinations: Solano, Sonoma, Sacramento, Lake and El Dorado counties

    5. Monterey County

    Out of state destinations: Arizona, Nevada, and Idaho

    In state destinations: San Luis Obispo, Fresno, Santa Cruz, Sacramento and San Diego counties

    6. Alameda County

    Out of state destinations: Arizona, Nevada, Idaho, and Hawaii.

    In state destinations: Contra Costa, San Joaquin, Sacramento, Placer, and El Dorado counties

    7. Marin County

    Out of state destinations: Nevada, Arizona, Oregon and Idaho.

    In state destinations: Sonoma, Contra Costa, Solano and San Francisco counties

    8. Orange County

    Out of state destinations: Arizona, Nevada and Idaho

    In state destinations: Riverside, Los Angeles, San Bernardino, San Diego and San Luis Obispo

    9. Santa Barbara County

    Out of state destinations: Arizona, Nevada and Idaho.

    In state destinations: San Luis Obispo, Ventura, Los Angeles, Riverside and Kern counties

    10. San Diego County

    Out of state destinations: Arizona and Nevada

    In state destinations: Riverside, San Bernardino, Imperial, Orange County and Los Angeles

  • The American Empire & Its Media

    Via Swiss Propaganda Research,

    Largely unbeknownst to the general public, executives and top journalists of almost all major US news outlets have long been members of the influential Council on Foreign Relations (CFR). 

    Established in 1921 as a private, bipartisan organization to “awaken America to its worldwide responsibilities”, the CFR and its close to 5000 elite members have for decades shaped U.S. foreign policy and public discourse about it. As a well-known Council member once explained, the goal has indeed been to establish a global Empire, albeit a “benevolent” one.

    Based on official membership rosters, the following illustration for the first time depicts the extensive media network of the CFR and its two main international affiliate organizations: the Bilderberg Group(covering mainly the U.S. and Europe) and the Trilateral Commission (covering North America, Europe and East Asia), both established by Council leaders to foster elite cooperation at the international level.

    In a column entitled “Ruling Class Journalists”, former Washington Post senior editor and ombudsman Richard Harwood once described the Council and its members approvingly as “the nearest thing we have to a ruling establishment in the United States”.

    Harwood continued:

    “The membership of these journalists in the Council, however they may think of themselves, is an acknowledgment of their active and important role in public affairs and of their ascension into the American ruling class. They do not merely analyze and interpret foreign policy for the United States; they help make it. 

    They are part of that establishment whether they like it or not, sharing most of its values and world views.”

    However, media personalities constitute only about five percent of the overall CFR network. As the following illustration shows, key members of the private Council on Foreign Relations have included:

    • several U.S. Presidents and Vice Presidents of both parties;

    • almost all Secretaries of State, Defense, and the Treasury;

    • many high-ranking commanders of the U.S. military and NATO;

    • almost all National Security Advisors, CIA Directors, Ambassadors to the U.N., Chairs of the Federal Reserve, Presidents of the World Bank, and Directors of the National Economic Council;

    • some of the most influential Members of Congress (notably in foreign & security policy matters);

    • many top jounalists, media executives, and entertainment industry directors;

    • many prominent academics, especially in key fields such as Economics, International Relations, Political Science, History, and Journalism;

    • many top executives of Wall Street, policy think tanks, universities, and NGOs;

    • as well as the key members of both the 9/11 Commission and the Warren Commission (JFK)

    Eminent economist and Kennedy supporter, John K. Galbraith, confirmed the Council’s influence: “Those of us who had worked for the Kennedy election were tolerated in the government for that reason and had a say, but foreign policy was still with the Council on Foreign Relations people.”

    And no less than John J. McCloy, the longtime chairman of the Council and advisor to nine U.S. presidents, told the New York Times about his time in Washington: “Whenever we needed a man we thumbed through the roll of the Council members and put through a call to New York.”

    German news magazine Der Spiegel once described the CFR as the “most influential private institution of the United States and the Western world“ and a “politburo of capitalism”. Both the Roman-inspired logo of the Council (top right in the illustration above) as well as its slogan (ubique – omnipresent) appear to emphasize that ambition.

    In his famous article about “The American Establishment”, political columnist Richard H. Rovere noted:

    “The directors of the CFR make up a sort of Presidium for that part of the Establishment that guides our destiny as a nation.

    [I]t rarely fails to get one of its members, or at least one of its allies, into the White House. In fact, it generally is able to see to it that both nominees are men acceptable to it.”

    Until recently, this assessment had indeed been justified. Thus, in 1993 former CFR director George H.W. Bush was followed by CFR member Bill Clinton, who in turn was followed by CFR “family member” George W. Bush. In 2008, CFR member John McCain lost against CFR candidate of choice, Barack Obama, who received the names of his entire Cabinet already one month prior to his election by CFR Senior Fellow (and Citigroup banker) Michael Froman. Froman later negotiated the TTP and TTIP free trade agreements, before returning to the CFR as a Distinguished Fellow.

    It was not until the 2016 election that the Council couldn’t, apparently, prevail. At any rate, not yet.

  • Trump Auto Tariffs Would Be "Net Negative" – Destroy 157,000 American Jobs

    New tariffs on imported automobiles and parts under consideration by President Trump could threaten more than 157,000 American jobs, according to a recent policy briefing published by the Trade Partnership WorldWide, an international trade and economic consulting firm.

    President Donald Trump talks with auto industry leaders, including General Motors CEO Mary Barra (4th L) and United Auto Workers (UAW) President Dennis Williams (4th R) at the American Center for Mobility in Michigan in March 2017. (Source: Reuters) 

    The six-page policy report said automobile tariffs introduced by President Trump would ultimately be detrimental to American workers. The organization analyzed the potential net impacts on American jobs and the economy from a 25 percent tariffs imposed on U.S. imports from all trading partners of automobiles, lightweight trucks, other vehicles, and parts.

    “We find that the tariffs would have a very small positive impact on high-skilled workers in the motor vehicle and parts sectors, but very large negative impacts on workers – both high- and lower-skilled – in other sectors of the economy. Overall, U.S. economic output would decline,” the report warned.

    The organization’s models indicate that Trump’s auto tariffs would boost employment in the auto sector by about 92,000, however, then eliminate 250,000 jobs across many industries throughout the broad economy. On top of that, American consumers will dish out about $6,400 more for an imported automobile that would cost around $30,000, which accounts for nearly a 21 percent increase in overall price. All in all, the report stated the economy would lose about .01 percent of its value if the auto tariffs were enacted. The study found:

    • The tariffs would result in a net loss of 157,000 U.S. jobs. A net loss of 250,000 jobs in the rest of the economy would more than offset an increase in U.S. motor vehicle and parts sector employment of 92,000 jobs.

    • About three jobs would be lost for every job gained in the motor vehicle and parts sector.

    • GDP would decline by 0.1 percent as higher costs, net job losses, and declines in producer and consumer spending power work their ways through the economy

    • Tariffs would add about $6,400 to the price of an imported $30,000 car.

    The briefing notes that its trade analysts did not take into account any potential retaliation measures by American trade partners for the tariffs.

    Table 1. U.S. Macroeconomic Effects of 25% Tariffs on Motor Vehicles and Parts

    “Table 1 shows that the tariffs are estimated to cause a net decline in the output of the U.S. economy of 0.1 percent in the time frame considered here. The decline results from higher costs that ripple through the economy, making U.S. exports less competitive, and new car purchases more expensive, for example.”

     (Source: Trade Partnership WorldWide)

    “Tariffs would reduce GDP by $18 billion and overall U.S. exports by nearly 2 percent annually,” the report stated.

    Tariffs will increase prices for both imported vehicles and the U.S.- made cars with foreign components.

     (Source: Trade Partnership WorldWide)

    Table 2. Net Number of U.S. Jobs Impacted by 25% Tariffs on Motor Vehicles and Parts (Number). 

    “Table 2 summarizes the estimated net job impacts. Overall, 157,291 net jobs would be lost, including 45,450 jobs in nonmotor vehicle manufacturing sectors. Most job losses would come from services sectors that feel the impacts of the tariffs as the U.S. economy slows. Many of those services jobs are tied to production in manufacturing sectors that are negatively impacted by higher costs for motor vehicles and parts – trade and distribution, construction, and high-skilled business and professional services. Within the motor vehicle and parts increase, just 17,676 of them – or 19 percent – are the higher-skilled jobs the Administration cited in launching the review.”

    The report concludes that President Trump’s automobile tariffs would be an overall “net negative” for American jobs and the economy.

    “Motor vehicle and parts tariffs of 25 percent would have serious net negative impacts on the U.S. economy overall. They would adversely impact many workers in manufacturing sectors, and hundreds of thousands of workers in services sectors that depend on the health of manufacturing. The tariffs would boost automobile prices, both domestic and imported. If supporting jobs and strengthening the economy are the motivations for invoking national security reasons for imposing protection, such tariffs would have the opposite impact from that intended.”

    President Trump’s threat of stoking a trade war between its trading partners is unsettling. The administration has threatened 25 percent tariffs on Chinese products, steel and aluminum tariffs on Europe, and has attempted to renegotiate the North American Free Trade Agreement (NAFTA) with Canada and Mexico.

    Trade organization and politicians who back free trade have been radically opposed to the administration’s trade tariff proposals.

    “Extending the reach of these tariffs and quotas to additional countries is certain to provoke widespread retaliation from abroad and would put at risk the economic momentum achieved through the administration’s tax and regulatory reforms. We urge the administration to take this risk seriously,” U.S. Chamber of Commerce Executive Vice President Myron Brilliant said Wednesday.

    The cautionary tale of the Smoot–Hawley Tariff Act of 1930 exacerbated the Great Depression as retaliatory tariffs by America’s trading partners reduced global growth. In a Central Bank induced economic expansion that is now entering the second longest cycle — and nearing the latter innings of the credit cycle. President Trump’s proposed trade war with trading partners might not be the best solution this late in the game if history means anything.

  • Amid "Russiagate" Hysteria, What Are The Facts?

    Authored by Jack Matlock via The Nation,

    We must end this Russophobic insanity…

    “Whom the gods would destroy, they first make mad.”

    That saying – often misattributed to Euripides – comes to mind most mornings when I pick up The New York Times and read the latest “Russiagate” headlines, which are frequently featured across two or three columns on the front page above the fold. This is an almost daily reminder of the hysteria that dominates our Congress and much of our media.

    A glaring example, just one of many from recent months, arrived at my door on February 17. My outrage spiked when I opened to the Times’ lead editorial: “Stop Letting the Russians Get Away With It, Mr. Trump.” I had to ask myself:

    “Did the Times’ editors perform even the rudiments of due diligence before they climbed on their high horse in this long editorial, which excoriated ‘Russia’ (not individual Russians) for ‘interference’ in the election and demanded increased sanctions against Russia ‘to protect American democracy’?”

    It had never occurred to me that our admittedly dysfunctional political system is so weak, undeveloped, or diseased that inept internet trolls could damage it. If that is the case, we better look at a lot of other countries as well, not just Russia!

    The New York Times, of course, is not the only offender. Their editorial attitude has been duplicated or exaggerated by most other media outlets in the United States, electronic and print. Unless there is a mass shooting in progress, it can be hard to find a discussion of anything else on CNN. Increasingly, both in Congress and in our media, it has been accepted as a fact that “Russia” interfered in the 2016 election.

    So what are the facts?

    1. It is a fact that some Russians paid people to act as online trolls and bought advertisements on Facebook during and after the 2016 presidential campaign. Most of these were taken from elsewhere, and they comprised a tiny fraction of all the advertisements purchased on Facebook during this period. This continued after the election and included organizing a demonstration against President-elect Trump.

    2. It is a fact that e-mails in the memory of the Democratic National Committee’s computer were furnished to Wikileaks. The US intelligence agencies that issued the January 2017 report were confident that Russians hacked the e-mails and supplied them to Wikileaks, but offered no evidence to substantiate their claim. Even if one accepts that Russians were the perpetrators, however, the e-mails were genuine, as the US intelligence report certified. I have always thought that the truth was supposed to make us free, not degrade our democracy.

    3. It is a fact that the Russian government established a sophisticated television service (RT) that purveyed entertainment, news, and—yes—propaganda to foreign audiences, including those in the United States. Its audience is several magnitudes smaller than that of Fox News. Basically, its task is to picture Russia in more favorable light than has been available in Western media. There has been no analysis of its effect, if any, on voting in the United States. The January 2017 US intelligence report states at the outset, “We did not make an assessment of the impact that Russian activities had on the outcome of the 2016 election.” Nevertheless, that report has been cited repeatedly by politicians and the media as having done so.

    4. It is a fact that many senior Russian officials (though not all, by any means) expressed a preference for Trump’s candidacy. After all, Secretary of State Hillary Clinton had compared President Putin to Hitler and had urged more active US military intervention abroad, while Trump had said it would be better to cooperate with Russia than to treat it as an enemy. It should not require the judgment of professional analysts to understand why many Russians would find Trump’s statements more congenial than Clinton’s. On a personal level, most of my Russian friends and contacts were dubious of Trump, but all resented the Clinton’s Russophobic tone, as well as those made by Obama from 2014 onward. They considered Obama’s public comment that “Russia doesn’t make anything” a gratuitous insult (which it was), and were alarmed by Clinton’s expressed desire to provide additional military support to the “moderates” in Syria. But the average Russian, and certainly the typical Putin administration official, understood Trump’s comments as favoring improved relations, which they definitely favored.

    5. There is no evidence that Russian leaders thought Trump would win or that they could have a direct influence on the outcome. This is an allegation that has not been substantiated. The January 2017 report from the intelligence community actually states that Russian leaders, like most others, thought Clinton would be elected.

    6. There is no evidence that Russian activities had any tangible impact on the outcome of the election. Nobody seems to have done even a superficial study of the effect Russian actions actually had on the vote. The intelligence-community report, however, states explicitly, “the types of systems we observed Russian actors targeting or compromising are not involved in vote tallying.” Also both former FBI director James Comey and NSA director Mike Rogers have testified that there is no proof Russian activities had an effect on the vote count.

    7. There is also no evidence that there was direct coordination between the Trump campaign (hardly a well-organized effort) and Russian officials. The indictments brought by the special prosecutor so far are either for lying to the FBI or for offenses unrelated to the campaign such as money laundering or not registering as a foreign agent.

    So, what is the most important fact regarding the 2016 US presidential election?

    The most important fact, obscured in Russiagate hysteria, is that Americans elected Trump under the terms set forth in the Constitution. Americans created the Electoral College, which allows a candidate with the minority of popular votes to become president. Americans were those who gerrymandered electoral districts to rig them in favor of a given political party. The Supreme Court issued the infamous Citizens United decision that allows corporate financing of candidates for political office. (Hey, money talks and exercises freedom of speech; corporations are people!) Americans created a Senate that is anything but democratic since it gives disproportionate representation to states with relatively small populations. It was American senators who established non-democratic procedures that allow minorities, even sometimes single senators, to block legislation or confirmation of appointments.

    Now, that does not mean that Trump’s presidency is good for the country just because Americans elected him. In my opinion, the 2016 presidential and congressional elections pose an imminent danger to the republic. They have created potential disasters that will severely try the checks and balances built into our Constitution. This is especially true since both houses of Congress are controlled by the Republican Party, which itself represents fewer voters than the opposition party.

    I did not personally vote for Trump, but I consider the charges that Russian actions interfered in the election, or – for that matter – damaged the quality of our democracy ludicrous, pathetic, and shameful.

    “Ludicrous” because there is no logical reason to think that anything that the Russians did affected how people voted. In the past, when Soviet leaders tried to influence American elections, it backfired—as foreign interference usually does everywhere. In 1984, Yuri Andropov, the then Soviet leader made preventing Ronald Reagan’s reelection the second-most-important task of the KGB. (The first was to detect US plans for a nuclear strike on the Soviet Union.) Everything the Soviets did—in painting Reagan out to be a warmonger while Andropov refused to negotiate on nuclear weapons—helped Reagan win 49 out of 50 states.

    “Pathetic” because it is clear that the Democratic Party lost the election. Yes, it won the popular vote, but presidents are not elected by popular vote. To blame someone else for one’s own mistakes is a pathetic case of self-deception.

    “Shameful” because it is an evasion of responsibility. It prevents the Democrats, and those Republicans who want responsible, fact-based government in Washington, from concentrating on practical ways to reduce the threat the Trump presidency poses to our political values and even to our future existence. After all, Trump would not be president if the Republican Party had not nominated him. He also is most unlikely to have won the Electoral College if the Democrats had nominated someone—almost anyone—other than the candidate they chose, or if that candidate had run a more competent campaign. I don’t argue that any of this was fair, or rational, but then who is so naive as to assume that American politics are either fair or rational?

    Instead of facing the facts and coping with the current reality, the Russiagate promoters in both the government and the media, are diverting our attention from the real threats.

    I should add “dangerous” to those three adjectives. “Dangerous” because making an enemy of Russia, the other nuclear superpower—yes, there are still two—comes as close to political insanity as anything I can think of. Denying global warming may rank up there too in the long run, but only nuclear weapons pose, by their very existence in the quantities that are on station in Russia and the United States, an immediate threat to mankind—not just to the United States and Russia and not just to “civilization.” The sad, frequently forgotten fact is that since the creation of nuclear weapons, mankind has the capacity to destroy itself and join other extinct species.

    In their first meeting, President Ronald Reagan and then General Secretary Mikhail Gorbachev agreed that “a nuclear war cannot be won and must never be fought.” Both believed that simple and obvious truth and their conviction enabled them to set both countries on a course that ended the Cold War. We should think hard to determine how and why that simple and obvious truth has been ignored of late by the governments of both countries.

    We must desist from our current Russophobic insanity and encourage Presidents Trump and Putin to restore cooperation in issues of nuclear safety, non-proliferation, control of nuclear materials, and nuclear-arms reduction. This is in the vital interest of both the United States and Russia. That is the central issue on which sane governments, and sane publics, would focus their attention.

  • "Uncomfortable" Starbucks Employees Respond To Becoming "World's Biggest Public Toilet"

    Starbucks employees are bristling after being forced to sit through an entire day of training on racial bias on Tuesday, following an April incident in which a Philadelphia manager called the police on a pair of black men who were sitting in the store without having purchased anything, which sparked a nationwide protest and culminated with Starbucks becoming “America’s largest public toilet.”

    In order to atone for the now-fired manager’s poor judgement, Starbucks rolled out a new “inclusiveness” policy – shuttering 8,000 locations for a day of “Color Brave” training which included several documentary videos, notebooks for employees to record their “private thoughts,” and a 68-page employee guidebook which teaches employees about topics such as institutional racism and the history of prejudice. 

    According to the WSJ, “they also listened to a series of audio recordings of Starbucks employees describing interactions they have had with customers in which their own biases became apparent.”

    The whole thing made many employees, especially African Americans, highly uncomfortable.

    “I don’t think Starbucks realized how uncomfortable it would be for people of color to have to watch these videos and talk about this,” said biracial shift supervisor Jamie Prater to the Journal, adding “But sometimes we need to be uncomfortable.”

    “Cordell Lewis, manager of the Ferguson, Mo., Starbucks, was among the employees who said the training seemed to make some African-Americans uncomfortable. He said he could see employees’ shoulders tighten as they leaned forward in their chairs.”

    The company’s new inclusiveness training also warned employees not to accidentally mistake scruffy looking husbands for homeless men.

    In one, an employee recalled seeing a scruffy-looking man approach a woman in line and hold out his hand to her, after which the woman got money out of her purse. The employee said she went up to the man and told him panhandling isn’t allowed in the store. The woman informed her the man was her husband.

    As we noted yesterday, Starbucks rolled back a key provision in their new “inclusiveness” policy which would allow vagrants to use the coffee chain as a homeless shelter. 

    On occasion, the circumstances of a customer’s disruptive behavior may make it necessary to prohibit that customer from returning to our stores.

    And while the “inclusiveness” training taught employees about institutional racism and not to discriminate against the homeless, others – predictably – felt Starbucks wasn’t inclusive enough.

    Mr. Lewis, who is biracial, also said the emphasis on relations between black and white people left some employees feeling excluded, something he raised with company leaders. “I have trans partners and Philippine partners, and they were like, ‘What about me?’”

    Yet other employees were turned off by the whole thing.

    One black barista in Connecticut told The Journal “it’s just to save face. It doesn’t mean anything.” Another barista from Ohio who is white said that he found the training “wishy-washy,” and that “I went in with an open mind. I was hoping we’d go through scenarios of how customers might feel in certain scenario and how to make them not feel that way.” 

    Still, some white employees found the training eye-opening.

    Krystie Ward, a barista in Patchogue, N.Y., said Tuesday’s training was enlightening, particularly a short documentary produced for Starbucks by filmmaker Stanley Nelson Jr. that detailed the history of access to public spaces for African-Americans. It featured a black man describing how he is often followed around stores by employees who suspect he is going to steal something. He said he has to be aware of the way he acts every time he leaves his house, like making sure to keep his hands visible in certain places.

    “That was really powerful to me, because I couldn’t imagine living my life like that,” said Ward, who is white.

    * * *

    Starbucks said there will be continuing education around diversity and bias, but the company hasn’t shared details of what that will entail. in doing so, it risks alienating the silent majority of employees who are already on the fence about the company’s virtue signalling policies:

    “The baristas are already doing five or 10 things, including taking out the garbage and cleaning the bathrooms,” said Prater. “We’re already struggling to provide the bare minimum of customer service, so when you throw in this, how do we even do this? This is a lot.”

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Jun 02

Today’s News 2nd June 2018

  • Retired Green Beret: 7 Ways To Stay Alive In A Post-Collapse Society

    Authored by Jeremiah Johnson (Nom de plume of a retired Green Beret of the United States Army Special Forces) via ReadyNutrition.com,

    There have always been times where we inadvertently put ourselves in precarious situations. In this case, your best bet is to trust your gut. If you don’t feel the situation is right, find the nearest exit and leave the area. We covered some of these times in our most recent article regarding attackers and how to handle them individually or en-masse.  In the article, we covered a lot of ground for scenarios that may occur during these “Good Times” prior to a societal collapse or nuclear war.  This article is taking those suggestions and applying them in a collapse environment. Before we begin, you must understand that the biggest difference is that in a post-SHTF scenario there are no rules.

    In a SHTF world, it’s a different story.

    The sad thing with laws and rules is that they only help protect the citizen from the law-abiding citizen: the system focuses on self-discipline and restraint.

    7 Ways To Stay Alive in a Post-Collapse Society

    As is extensively detailed in The Prepper’s Blueprint: How To Survive Any Disaster, life will definitely be different when the SHTF. You will not be able to rely on the law to protect you; however, you will also not be prosecuted under the law for some superficial or superfluous reason: your life and your family’s lives take precedence.  That being said, what do you do?  How do you handle these attackers…people that are intent on taking you down and taking what you have?  Let’s outline some basics that you can use post-SHTF.

    1. Never travel anywhere alone: always go in pairs with one to guard and watch over the other one.

    2. Never go anywhere unarmed: preferably with a rifle or shotgun, a main sidearm (pistol), a backup sidearm/piece, plenty of ammo for all of them, a fixed-blade knife, and a folding (lock-blade) knife at a minimum. Read more about SHTF firearms in this article. Yes, that is a lot of stuff.  Let’s make some further suggestions on these.  Mossberg 500 series 12 gauge shotgun.  .45 ACP main pistol.  .22 cal lr revolver or pistol…suppressor is optional but highly recommended.  Gerber Mark II fixed-blade knife.  Spyderco police model folding knife.

    3. Never travel anywhere without the rest of the family/group knowing where you’re heading: Don’t mess around with this one. If trouble arises, you cannot go off wandering on your own and expect anyone to come to your aid.

    4. Consider all strangers armed and potentially dangerous: If you wish to be the “Good Samaritan/Mister Rogers,” this is your choice. After the SHTF, however, the rules are off, and it is (paraphrasing Jack London) back to the Law of Club and Fang.

    5. Keep your distance when talking to strangers: As President Reagan phrased it so eloquently, “Peace through superior firepower.” Watch their eyes, watch their hands, and conclude your discussion in a businesslike manner.  Don’t waste time: get to the point and then get going. Along those lines, pay attention to the way you carry yourself in public. Your body language can be very telling. Predators normally watch their victims before they strike and look for key indicators.

    6. Meeting strangers: You may wish to have a couple extra people roaming around at a distance to watch for the approach of an ambushing force. Many attacks begin by placing people at ease and using a larger force held in reserve to swoop in when the parlay has begun, and everyone’s guard is down.

    7. Territory: You need to stake it out, post it (warn others), and enforce the fact that it is your territory. Many times, attackers will be “persuaded” to find a softer target: one that is less organized with people not in a readiness stance at all times.

    Related: 10 Ways To Avoid Marauders and Looters After the Collapse

    These Post-Collapse Rules Will Keep You Alive

    There are some rules to follow that are hard rules, but will serve you in good stead.  They apply in a wartime situation, and they will apply equally in a disaster such as an apocalyptic event with societal collapse.

    1. Everybody Wants Something: they aren’t traveling toward your home turf for nothing.  They want something: food, water, clothing, shelter, tools, or interest in the opposite sex.  This last we’ll cover as an “individual item.”  You need to find out what they want, and if they’re willing to trade something for it or if they’re just out scouting to raid (the more likely of the two choices).

    2. Discretion is the Better Part of Valor: Keep a cool head, a steady hand, an unflinching eye, and the ability to go into fighting mode in an instant.  An aggressor will notice these things.  He will want to assess your abilities.  This also means keeping your cool.  It doesn’t mean shutting up and allowing yourself to be verbally bullied into a corner.  The enemy can sense weakness, as well.  Mr. and Mrs. Hallmark?  You’re going to have to step up and do your own dirty work…your own fighting for once.  Better be smart and don’t bite off something that is bigger than you can chew.

    3. Interest in the Opposite Sex:  This is a fact of life.  The primary groups will be groups of men that are correlated directly with ancient hunting parties of old.  These groups of men will no longer have rules they have to follow and they will want your wife, your daughter, or your sister.  They will adhere to no rules or propriety.  They will want children as well: girls or young boys.  Let me be perfectly clear: you will have to kill them when they come for such.

    4. Cannibalism: Yes, cannibalism is always something you may have labeled as a “fluke” event, such as “Alive: The Story of the Andes Survivors,” but it is not.  There was an Army study years back that found that 1 human out of 1,000 will actively hunt other humans for food.  I’m here to tell you, that number is grossly underestimated.  Cannibalism begins almost immediately, at least within the first 1 to 2 weeks following a disaster.  There is plenty of history out there to document it, such as the Donner Party, as well as a presentation done by the Discovery Channel.  Be aware of it: they’ll be out there, and you need to be ready for them.

    You need to continuously assess your fighting skills and training.  Assess these realistically, and take into account your shortcomings.  Learn to “pair” your preference with what is most effective.  Although I can more than handle myself in a knife fight, I prefer to meet an attacker carrying a blade with a nice 24” Aluminum T-Ball bat.  I’m here to tell you, when the bat is swinging?  The bat is singing, and the song it’s playing is all mine.  You have to find your own personal weapon of choice for “close encounters” where a firearm may not be able to be used.

    In the end, taking care of yourself is a stance, and when the “S” hits the fan, the rules will disappear: they are as fragile as society itself, as fragile as cobwebs drenched with dew in the summer sun.  A strong wind will blow them away, just as an event will blow down the Hallmark houses made of straw and blow away the thin veneer of civilization masking the underlying, atavistic barbarism along with it.  Now is the time to assess yourself, make your plans, and execute those plans to strengthen your body, mind, and spirit to prepare for the times to come.  JJ out!

  • California Is To The UK, As Montana Is To Uzbekistan…

    The United States is the world’s largest economy, but, as Visual Capitalist’s Jeff Desjardins notes, sometimes it’s easy to forget just how massive a $19 trillion economy actually is.

    The only comparable economy in size would be China, but unfortunately the incredible scope of China’s economic boom is something that is also difficult for foreigners to wrap their heads around. We’ve tried to do this in the past by showing you the massive cities that no one knows about, ambitious megaprojects that are underway in the region, and the country’s staggering demand for commodities.

    But still, comparing the U.S. to China can be overwhelming – and that’s why it can be more effective to show the U.S. economy as the sum of its parts.

    STATES AS COUNTRIES

    Today’s infographic comes to us from the Carpe Diem blog done by Mark Perry at the American Enterprise Institute.

    Courtesy of: Visual Capitalist

    It matches the size of U.S. state economies, based on nominal GDP numbers, with comparable countries around the world. For example, the state of Texas ($1.7 trillion) is roughly the equivalent of Canada ($1.65 trillion), while Maine ($61.4 billion) is closer to Panama ($61.8 billion) in terms of economic output.

    Here’s the full table – courtesy of Carpe Diem – on how each state breaks down:

    SUM OF THE PARTS

    By looking at the United States in this unique way, we really get a better sense of the scale of the country’s economy as a whole.

    Add together just the states of California, Texas, and New York, and you’ve got an economy the size of the United Kingdom, Canada, and South Korea put together. And with each additional state, you’re adding significant economies like Indonesia, Netherlands, Saudi Arabia, or Singapore to that mix.

    Impressively, even the more sparsely populated states have country-sized economies. Montana compares to Uzbekistan, North Dakota is similar to Croatia, and so on.

    If you’re interested in seeing other ways to visualize America’s economy, see a previous post using some other Carpe Diem maps here.

  • The Cognitive Dissonance Surrounding Donald Trump

    Authored by Brandon Smith via Alt-Market.com,

    In general, it has always been dangerous to put blind faith in human icons of any kind; not to mention, entirely unnecessary. The maxim that one “should never meet their heroes” is something far more people should take to heart when applying elevated status to political leaders in particular. Hero worship of a celebrity is unhealthy, but hero worship of a president can be truly dangerous.

    Why? Because political power relies mostly on “human capital” — the number of people within a society that are willing to support or even fight for a particular change. Swaths of citizenry can be wielded by politicians with ill intent like a weapon to create the illusion of consensus and dramatic reversals in cultural principles. These changes usually tend to involve more control for government and less freedom for the public and can last for generations.

    The cult of celebrity has never been more prominent in politics than it has the past decade. Starting with Barack Obama, something changed in the American view of presidential leadership. With Obama, there was an element of naive adoration that leftists largely embraced. Obama was more than a president — he was an idol.

    Unfortunately, I am also seeing some of the same behavior in elements of the conservative population when it comes to Donald Trump. There are many reasons for this.

    First, Trump is one of the few presidents that was already a celebrity before running for office. His notoriety went far beyond that of someone like Ronald Reagan, who did rank as a kind of known cultural element, but certainly not an icon or idol before becoming president.

    Second, Trump rode the wave of a backlash movement against the far left, which is now by every definition fully invested in cultural Marxism if not economic Marxism. For many people, Trump represents the moment America was “saved” from imminent destruction by an insane ideology. In fact, I would say Trump’s popularity was directly proportional to the moderate public’s disgust with social justice fanatics; people who believe that sabotaging a culture from the inside, breaking it down through deliberate crisis and then replacing its core principles with their own, is an acceptable strategy.

    Third, the election of 2016 was not about Donald Trump versus Hillary Clinton – it was about traditional American values versus moral relativism. At least that was how many conservatives viewed it.

    Some people may argue that Trump earned his election win by bravely taking on the establishment and the hard left when no other candidate would. This rebellion remains to be seen, but the notion is powerful and people take it personally. Trump cheerleaders react with disdain when any critical tone is applied to his behavior. In their mind, only evil leftists are critical of Trump, and if you are on the political right, then you better be toeing the line. If you are not with them, you are against them.

    It’s funny; when I was writing analysis on the disturbing nature of the Bush administration, I was called a leftist. When I went after Barack Obama, I was called a “far-right extremist” and a potential racist. Now, when investigating Trump’s odd activities, I’m back to being accused of leftist antics again. I’ve magically come full circle.  When it comes to political bias, reason takes a back seat to team-based psychology.

    Trump’s win, of course, had nothing to do with his validity as a candidate nor did he create his own following. His following was prepackaged. The rage against social justice and leftist absurdity was already vast. Trump was simply used as a focal point for that rage and his rhetoric tapped into the conservative psyche. He said most of the right things during his campaign; whether he actually believes in those things is another matter…

    So far, his track record is not so great. One of his most vital campaign promises which appealed to the largest portion of conservatives was the idea of “draining the swamp.” What is the swamp? Trump defined it himself by going after Hillary Clinton’s contingent of elitist allies from think tank cronies to Goldman Sachs banking ghouls. This is a perfect example where Trump rhetoric does not match reality.

    By Trump’s own definition, he has actually added to “the swamp” rather than draining it. Trump’s cabinet is loaded with an ensemble of elitist freaks that should have been relegated to a carnival side show.

    Goldman Sachs goons like Steve Mnuchin and James Donovan lurk the halls of the White House while other Goldman alumni like Gary Cohn seem to cycle through and are replaced with other equally unsettling characters like Larry Kudlow, a former adviser to the Clintons and John Podesta as well as an economist for the Federal Reserve bank. You have Mike Pompeo, Secretary of State and a rabid supporter of mass surveillance of the American people. There’s Gina Haspel, a CIA director wrapped up in numerous torture scandals. And let’s not forget about John Bolton, National Security Adviser, Council on Foreign Relation member and one of the chief architects behind the aggressive U.S. war policy in the Middle East since George W. Bush’s administration.

    I could go on and on…

    Obviously, the swamp will not be drained anytime soon, if ever. But cognitive dissonance on this issue reigns supreme. Even in the liberty movement there are those that argue that Trump is merely “playing 4-D chess,” and that his introduction of even more elites into his cabinet is somehow part of a grand scheme to “keep his enemies close.” The laughable nature of this delusion aside, the fact that some people are willing to stretch that far in their mental gymnastics to justify continued faith in Trump is a bit frightening.

    I have also witnessed a growing and disturbing trend of leader worship when it comes to Trump’s pursuit of the international trade war.  As I mentioned in my article ‘Trump Trade Wars A Perfect Smokescreen For A Market Crash’, tariffs are not inherently destructive and can actually be very effective in undercutting the imbalances created by globalism; they are a natural part of the conservative methodology.  However, if implemented poorly, and without correct preparations, tariffs can destroy a nation’s economy.

    With all the rah-rah and pom poms from the Trump devout, you would think that America’s economy is virtually invincible under his watch.  I’m sorry to say that this is not the case.  The fiscal instability of the US is still very much a “thing”, and nothing has improved under Trump.  Given, he has not been in office very long, but most of our economic problems cannot be solved by any one president regardless of their time in office. Those problems stem from the power of the Federal Reserve to prop up or sabotage our system at will, and the ongoing presence of elitists within our government.  Trump appears to have no intention of ever going after the Federal Reserve, and as mentioned earlier, he has invited a gang of elitists into the White House.  Fiscal improvement is now impossible

    Beyond the root cancer affecting our nation, Trump has not even taken the more rudimentary steps of giving corporations incentives to bring production back to America BEFORE attempting to enforce trade tariffs.  With America’s dependency on foreign production as well as the elephant in the room – America’s dependency on foreign investment in our debt and the dollar as a world reserve currency, a drawn out trade war will eventually result in severe retaliation.  This means extreme price inflation on most goods due to import dependency or possible scarcity, not to mention the dumping of US Treasury bonds, the end of the petrodollar and the dumping of the dollar in bilateral trade creating even more price inflation.

    America looks rather hypocritical crying foul on unbalanced trade while we benefit from the greatest trade imbalance of all time – the world reserve currency.  If you think that the dollar will not be a target in the trade war, then you are gravely mistaken.

    I’ve heard all the naive arguments before as to why a negative trade war outcome is supposedly impossible and countered each of them in the article linked above.  But, the pressure to support Trump without taking a skeptical position is high.

    I would attribute this to what I consider a psychological game being played by the establishment. As stated earlier, Trump’s political success relies entirely on the existence of continued foreign and domestic threats. As long as foreign economies are seen as receiving unfair trade advantages, and as long as the left keeps acting insane, Trump will receive blind support from many conservatives. Rather than making his administration weaker, the “Russian collusion mania,” for example, only continues to strengthen Trump’s position.

    The idea that the “Deep State” is after Trump is an illusion. On the contrary, without the perception that Trump is under constant attack, Trump becomes superfluous as a leader and conservatives will begin to question his decisions. The establishment actually helps Trump’s image by continuing the Russian farce, just as the constant (but weak) attacks by establishment controlled media made Trump a 24 hour news phenomena and propelled him into a new level of celebrity status during the election.

    One could argue that perhaps the establishment is unaware of this dynamic. I think not. The manner in which they track social trends through web analytics is rather precise. Though I know it will twist the panties of quite a few people, I would suggest that the establishment PREFERS to have a Trump administration in place.

    Look at it this way: Conservatives will cry foul for the remainder of Trump’s first term all based on the false premise that Trump is going to be “impeached” or sabotaged at any given moment. I remember all the claims before the election when I predicted a Trump win that the establishment would never allow him to enter the Oval Office. After his election, the same people argued that he would never make it to the inauguration. Now, they argue that the so-called deep state is going to try to bring Trump down before he reaches the end of his first term. And as long as Trump continues to stick around, there are those that argue that he is “defeating the deep state” with his magnificent strategic prowess. You see, the cognitive dissonance circle is infinite.

    Few people appear to be considering the possibility that Trump is exactly where the establishment wants him to be; that the Trump administration is loaded with the very same swamp creatures he railed against during his campaign and that these elitists are the true power in the White House, not Trump.

    Let me say this as clearly as possible — presidents do not matter. They do not matter in terms of any important change in American society. Those great changes are always made either by a contingent of free people fighting relentlessly for good, or by a contingent of power mongers manipulating the halls of government from behind the scenes. In the end, like most other presidents, Trump is irrelevant, unless you view him as a pied piper leading conservatives down a terrible path.

    The danger of Trump, if followed blindly, is threefold.

    First, the more conservatives tie themselves to his administration, the more they leave themselves vulnerable if and when his administration sinks into infamy. For example, the Federal Reserve has been avidly pulling the plug on its decade long artificial support of stocks and bond markets. Continued interest rate hikes and balance sheet cuts will ultimately crash those markets, and this will happen before the end of Trump’s first term if the Fed continues at its current pace.

    Trump may very well be the next Hoover, as I have warned time and time again since his election. A conservative president presiding over an economic catastrophe that developed long before he ever entered office, but still blamed for the consequences. In the case of Trump, it will be conservative ideals and policies that are demonized most of all, leading to renewed public support for another FDR (i.e., another hardcore communist president).

    Second, Trump’s trade war activities continue to provide perfect cover and distraction on a monthly basis for the Fed’s balance sheet dumps and interest rate hikes.  Every time stocks drop dramatically, very few people blame the fed’s activities and all attention shifts to Trump.  I see a narrative building already, one that hides all central bank guilt in the degradation of the economy.  The more conservatives support a badly planned trade war, the more they will be seen as complicit in an economic crash that actually started over a decade ago.

    Third, if Trump is meant to become a war hawk president as the introduction of John Bolton to his cabinet suggests, then conservatives may very well repeat the mistakes they made years ago when they fervently supported the Bush administration and the Iraq War. This time, though, America will not economically or philosophically survive another unjustified or ill-considered war. Not with Iran, North Korea or any other nation for that matter. Once again, true conservatives could have the tragedies produced by war wrapped around their necks if they do not apply critical thought to Trump as they do with most other issues.

    And this is the solution to the problem. It is very simple; just treat Trump as you would any other politician, remove all bias and examine him under a microscope in the light of day. The more conservatives openly criticize Trump where it is warranted, the less the establishment is able to chain us to any disasters that happen under his watch. With the cabinet of grim elitist figures surrounding him from day to day, it is the only logical recourse.

    *  *  *

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  • New Retirement Survey Reveals People Globally Don't Understand Investment Or Inflation

    A new test given as part of the Aegon Retirement Readiness Survey, about the financial literacy of people worldwide, has produced some alarming, yet not that surprising, results. It should be of no surprise that people globally don’t really understand some of the central tenants to global monetary policy, nor do they understand some of the key concepts about retirement. This was revealed in a recent Bloomberg article published today, which states that “Many of the participants failed the quiz, with big potential consequences for their future security.”

    Here’s the quiz in its entirety.

    The first alarming problem is that the average every day investor doesn’t seem to understand the difference between a stock and a mutual fund. When asked which of the two were the riskier financial instrument, only 45% of people around the world knew the answer – that’s less than half. Bloomberg wrote:

    But before we get to that, take a look at this question—only 45 percent of people around the world got right:

    Q. Do you think the following statement is true or false? “Buying a single company stock usually provides a safer return than a stock mutual fund.” 

    The possible answers? True, false, do not know and refuse to answer. 

    Sixteen percent of people got it wrong. “Do not know” was chosen by 38 percent. In the U.S., 46 percent of workers got it right. Good for you, America. (The answer, in case you were wondering, is false.) 

    Also, it is a little to no surprise that the average middle-class worker doesn’t seem to understand how inflation works or how it affects their ability to purchase goods. This may explain Central Banks’ obsession with manipulating it and using it as a tool to further their spending agendas. The article continued:

    It was an inflation question that had the highest percentage of wrong answers, however. More than 20 percent of workers didn’t grasp how higher inflation hurts their buying power. Given that declining health was the most-cited retirement worry, at 49 percent, and healthcare is an area (in the U.S., especially) with high cost-inflation, well, that makes the subject something older folks should have down cold.

    Despite the lack of understanding, making fiscal sense remains a major concern for people heading toward retirement. The survey also queried participants regarding what their biggest concerns were as they approached retirement. “Running out of money” came in second, only to “declining physical health”. 

    Despite not understanding the core principles of the government’s monetary policy, participants in the survey seemed to be sure that the government benefits offered for retirement were crucial to a comfortable retirement. As the government takes with the hand of inflation, it gave survey participants a warm and comfortable feeling with the other hand that spends on their retirement benefits. 

    The survey asked workers—about 1,000 per country—what global trends would affect their retirement plans. “Reduction in government retirement benefits” was the most popular answer worldwide, chosen by 38 percent globally; in America, it was 26 percent. The countries most worried about cuts to government benefits? Brazil and Hungary, at about 53 percent.

    The reality of trends that will actually impact retirees seemed to go unnoticed, however, according to the survey.

    Across the board, though, workers didn’t seem to recognize the huge impact that basic changes in the labor force, technology and the climate will probably have on their retirement plans, said Catherine Collinson, president of the nonprofit Transamerica Center for Retirement Studies and executive director of The Aegon Center for Longevity and Retirement. 

    Survey participants also seemed to be a little detached from when they would actually stop working, on average. The survey found an alarming number of people who wanted to work to 65 but had to retire early, generally for reasons of declining health or simply “job loss”. The article continued:

    “It makes me wonder about the extent to which people are naive about the magnitude of the disruption in our world, and the level of change that has not only occurred, but is imminent,” said Collinson. “Is it that people don’t see it coming, or is it so overwhelming that people are in denial?”

    Many workers may well be in denial about how long they can actually work. The survey found workers generally plan to retire around age 65. “The sobering reality is that 39 percent of retirees globally retired sooner than planned,” according to the report. “Of those, 30 percent stopped working earlier than they had planned for reasons of ill health, and 26 percent due to unemployment/job loss.”

    As for being kept company during retirement, 20% of Chinese workers believed that robots will be doing the job by the time they retire. 

    The survey asked about “aging friendly modifications or devices” people envisioned having in their homes. Thirty-five percent of workers in India, 34 percent of workers in Turkey and 18 percent in the U.S. figured aging could include video monitoring devices. Then there are the robots, which 20 percent of Chinese workers see coming in retirement, compared with 6 percent of American workers. 

    This comes just a couple months after we released this report detailing the real retirement crisis: elderly people are simply broke. 

    A study released by GoBankingRates reveals that older people planning their retirement have cause for concern. Forty-two percent of Americans are facing their golden years with less than $10,000 in savings. A lack of savings and planning has reduced what should be an enjoyable time in seniors’ lives to a period of stress and worries for many.

    Out-of-pocket expenses for health care is spiraling. The Bureau of Labor Statistics indicates that Americans 65 years of age and older may spend up to $46,000 annually on healthcare. This is not good news for those with only $10,000 on which to fall back on.

    For adults over 50, this should be a call to act now, while there is still time. Only one-third of adults in that age group have savings greater than $10,000. Retirement planning needs to become a priority, as there is little time to waste. Pensions are becoming rarer, and Social Security is becoming less secure than it used to be. Many health needs of seniors are not covered by Medicare. Some experts believe the Social Security system will be depleted by 2030. Adults over the age of 50 need to consider making contributions into 401(k) accounts or similar retirement plans.

    Social Security was never intended to be the sole income of retiring seniors. It was meant to supplement approximately only 40% ofpost-retirement spending. Social security was supposed to enhance seniors’ lives, not support it entirely. However, according to Investopedia.com, 43 percent of unmarried seniors rely on Social Security to cover 90 percent of their basic needs. Almost a quarter of married couples depend on Social Security to meet most of their expenses.

    Some seniors struggling with poverty are able to receive supplemental income (“SPM”), such as food stamps for a bit of additional help. The need is especially high for seniors who are women, African Americans, and Hispanics, and those with ongoing health issues.

    6,400,000 million American seniors are living at poverty level, struggling to meet fundamental needs such as rent and food. 

    So if you are confused as to why more people are not appalled about the state of global economic policy, maybe it’s because they simply don’t understand it. It is only those that know how policy works behind the scenes and can see through the “tricks of the trade” that find themselves speaking out against the way global economic policy is managed.

  • "I Arrived In Brazil In The Middle Of The Zombie Apocalypse…"

    Brain Winter, Editor-in-Chief of Americas Quarterly, has just returned from a week in Brazil, and what he describes is incredible…

    https://platform.twitter.com/widgets.js

    The once unthinkable is now becoming normal…

    SÃO PAULO – I arrived here on Sunday in the middle of the zombie apocalypse. Or so it seemed. A nationwide truckers’ strike was in its seventh day and 99 percent of São Paulo’s service stations had run out of gasoline. The roads of South America’s biggest city were deserted of cars and people, and the skies were a murky gray. The normally hellish drive from the airport, which often lasts two hours or more, took a disconcerting 23 minutes.

    Up on Avenida Paulista, the city’s closest thing to a public square, things seemed more normal – at first. Huge crowds milled about, vendors were grilling beef and sausage, and girls in hot pink roller skates clomped by. A quadruple amputee was belting out the falsetto ending of Pearl Jam’s “Black” to an enthralled crowd. The sun was out now, and families sat at wooden tables with sweaty buckets of beer, laughing. Of course, I mused, Brazilians are going to make a party out of a bad situation. I bought a can of Skol and decided to join the fun.

    Then I saw it. A huge banner, spanning the entire avenue, carried by a group of protesters:

    “SUPPORT FOR THE TRUCK DRIVERS. MILITARY INTERVENTION! ARMED FORCES, URGENT!”

    And that was the start of a week where I saw and heard things I never believed I would in Brazil.

    The Brazil of mid-2018 is a frightened, leaderless, shockingly pessimistic country. It is a country where four years of scandal, violence and economic destruction have obliterated faith in not just President Michel Temer, not just the political class, but in democracy itself. It is a country where there will be elections in October, but most voters profess little faith in any of the candidates. Given that vacuum, many Brazilians – perhaps 40 percent of them, according to a new private poll circulating among worried politicians – believe the military should somehow act to restore order. Amid this week’s strike, the clamor became so loud that both Temer and a senior military official had to publicly deny the possibility of an imminent coup.

    This was all unquestionably good news for the presidential candidate most identified with the armed forces, retired Army captain Jair Bolsonaro, who was already running first in polls. Many analysts expect him to rise further after this week’s events.

    It’s a red alert for anyone else – foreign investors and ordinary Brazilians alike – with the old-fashioned belief that healthy civilian institutions are the key to long-term prosperity, or who still hold out hope that Brazil’s economy and political outlook might finally stabilize this year.

    When I lived in Brazil as a reporter from 2010 to 2015, I heard hardly anyone defend military rule – at least out loud.

    The last dictatorship, which ran from 1964-85, left behind a legacy of debt, hyperinflation, falling wages and human rights abuses. Yet unlike Chile and Argentina, Brazilian soldiers were never judged for their crimes – and never fell into abject disgrace. So today, with Brazil at the forefront of a global backlash against “elites” and institutions, the military is increasingly perceived as the only credible vehicle for change. Polls show the armed forces are by far the country’s most respected institution (the press is a distant second). A year ago, 38 percent of Brazilians told the Pew Research Center that military rule would be “good for the country.” That number is surely higher now.  

    The truckers’ strike started on May 21 after a government-sanctioned hike in diesel prices, but quickly grew into something much bigger. On WhatsApp groups and elsewhere, striking truckers shared videos and other messages calling for an end to Temer’s government. One cited by Estado de S.Paulo read: “Victory is near! Truckers + the people x legality x legitimacy = the fall of the Brazilian Bastille! Let’s not weaken. Come on, National Security Forces!” On Wednesday, the phrase intervenção militar was being mentioned on Twitter at a pace of 515 times per minute, according to one study. Smelling blood, many truckers continued to block roads even after a deal was truck with Temer to bring diesel prices back down. By this point, supermarkets around the country were running out of basic goods, and half of Brazilians had to change their daily routines because of lack of fuel, according to a Datafolha poll. Yet that same poll showed the strikers had the support of a whopping 87 percent of the population. 

    Why? I spoke to many protesters on Avenida Paulista, and others over the course of the week. Many drew a direct link between the diesel price hike and corruption at Petrobras, the state-owned oil company at the heart of Brazil’s “Car Wash” corruption scandal. “Of course the politicians raise prices so they can steal more money!” one middle-aged woman told me. Virtually everyone thought that anything bad for Temer – the first Brazilian president ever to be charged with a crime while in office, and who has an approval rating of 5 percent – must be good for the country. Still others insisted democracy had proven an ineffective tool to fight street crime, corruption and general disorder. I found myself arguing about this with a salesman in his sixties who had lived through the last military regime.

    “I didn’t like the dictatorship,” he replied, “but right now, come on, não é muita democracia? Don’t we have too much democracy?”     

    Polite society, especially in the big cities, continues to insist such voices are a minority. But I also spent part of the week among politicians, and just beneath their sunny bravado was a dark sentiment I could only describe as “end of days.” One group was discussing how the military commanders weren’t interested in taking power, but the rank-and-file was obviously restless. I heard of one recent instance in which a general approached a well-known politician to urge him to run for president and “save the country.”

    “I don’t think a majority of Brazilians want a coup,” a prominent political analyst told me, “but if it did happen, the people would probably support it.”    

    In truth, a traditional coup with tanks in the streets is almost unthinkable – a “relic of the 20th century,” as one military leader put it this week. In the 21st century, when democracy erodes, it almost always happens via the ballot box. Bolsonaro has vowed if elected to appoint military officials to key cabinet positions, roll back human rights provisions and give security forces “carte blanche” to kill suspected criminals, among other measures. Gen. Joaquim Silva e Luna, whom Temer appointed as Brazil’s first non-civilian defense minister in February, told Bloomberg News last week that he welcomed Bolsonaro’s candidacy. “Brazil is looking for someone with values … and they consider that the armed forces have these attributes,” he said. Why bother with a coup, when there are easier ways to gain power? 

    This week also brought a counterreaction of sorts from elsewhere in Brazilian society: There were signs of the left and some interesting pro-business bedfellows coalescing around Ciro Gomes, a former finance minister and governor. Elsewhere, leaders from the beleaguered center-right Brazilian Social Democracy Party (PSDB) were looking carefully at polls to decide whether to abandon Geraldo Alckmin as their presidential candidate and go with an “outsider” figure like João Doria instead. But overall, there was little sign of any political consensus that could bring the difficult reforms and bold investments that Brazil needs to recapture the promise it showed last decade. Instead, society seems entirely focused on tearing down existing structures, without much thought to what comes next. Perhaps surprisingly, the most lucid comment to that effect came from President Temer, at a press conference for foreign journalists.

    “Every 20 or 30 years in Brazil, there’s an attempt to reinvent things … to destroy what is there and build a new order,” he said.

    He’s right. And for that, Brazilian politicians can largely blame themselves. 

  • Calling All Broke Millennials: Vermont Will Give You $10,000 To Move There And Work From Home

    The Governor of Vermont has introduced an unusual law that will pay people who move into the state and work remotely for an out-of-state company – $10,000 over a two year period to cover relocation costs, office equipment, internet, and other work-related expenses.

    Governor Phil Scott approved the legislation on Wednesday (May 30) in hopes to bottom out the rapidly shrinking tax base, and, of course, sucker in those heavily indebted millennials from large cities.

    According to the Vermont House of Representatives, the “Remote Worker Grant Program” will start on January 01, 2019, and will cover a variety of business-related expenses of a worker’s transition to the state, including relocation services, computer software and hardware, broadband access or upgrade, and membership in a co-working or similar space expenses.

    Vermont has found the funds to budget roughly 100 grants for the first three years of the program, and after that, 20 additional workers per year for an unspecified amount of time. An eligible “remote worker” under the program could receive not more than $5,000.00 per year, not to exceed a total of $10,000.00 per individual over two years.

    CNBC said the program operates on a first-come, first-served basis and is only available to new residents who relocate on or after January 01, 2019.

    The new law is designed to catch the falling knife of a rapidly shrinking tax base, along with thwarting an economic crisis that has been sparked by Vermont’s aging population.

    “Vermont continues to age, and age faster than the nation as a whole,” writes Art Woolf for the Burlington Free Press. “Over the past quarter of a century, the median age nationally has increased by almost five years to 37.8 while Vermont’s has increased by 10 years.

    “The most common age in Vermont is 19 years. But that’s because Vermont brings in a lot of college-age students from other states. Ignoring the 18 to 22 year-old college student cohort, the most common age is 55, which is people at the tail end of the baby boom generation. Vermont has a lot more baby boomers, people between 53 and 71, relative to other ages, than the U.S. There are a lot of baby boomers nationally, but the age with the largest number of people nationally is 25 years old, part of the millennial generation.”

    Woolf also said, “our largest age cohort is the baby boomers, not the millennials if you ignore the large number college students – even those who come from out of state – who are counted as Vermont residents.” This trend has made Vermont one of the oldest states in the country, in regards to age.

    “We have about 16,000 fewer workers than we did in 2009. That’s why expanding our workforce is one of the top priorities of my administration,” Governor Scott said in a statement while addressing the need to attract younger working families to the state.

    “We must think outside the box to help more Vermonters enter the labor force and attract more working families and young professionals to Vermont. That’s exactly what the Department of Tourism and Marketing did with this program for out-of-state visitors who may be interested in living full-time in Vermont, and I’m excited to see it move forward.”

    CNBC explains the program will be spread across “four weekends and will be piloted in three communities.” One of those locations will be Brattleboro, Vermont.

    “The one thing we need more of in Vermont is people,” says Adam Grinold, executive director of the Brattleboro Development Credit Corporation. “We need more visitors, we need more employees, we need more business owners. We need more people.”

    While a demographic time bomb is looming for Vermont, the recent reactionary efforts by officials to divert taxpayer dollars for programs to attract millennials from other states is merely a short-term solution and will not solve the old age crisis. Expect this trend to increase with other states, as the good ole’ days of easy money, are over.

  • What's A Life Worth In America? Four Bucks? Nope… Four Cents!

    Authored by Abby Zimet via CommonDreams.org,

    In what’s been called “the most racist jury ‘award’ in history,” a Florida jury has decided there was really no problem with cops shooting and killing Gregory Vaughn Hill Jr., 30, in 2014 because he was playing music too loudly in his own garage while drunk. (Need we add, Hill was black?)

    The civil verdict marked the dismal end to a longstanding wrongful death suit filed by Hill’s family in 2016, two years after St. Lucie County sheriff deputies turned up at Hill’s house in Fort Pierce following complaints he’d been playing loud “F.U. music” in his garage as a nearby middle school was letting out for the day.

    When Hill heard the cops knock, he opened the garage door, saw them, and began closing it again, at which point deputy Christopher Newman shot him three times – once in the head, twice in the abdomen – through the door, because everyone knows that according to the impeccable standards of American jurisprudence, getting drunk, playing music and closing a garage door are punishable by death without a trial.

     Police later claimed he’d had a gun they told him to drop – a claim never proved – and then said they’d found a gun (unloaded) in Hill’s back pocket; they also determined his blood alcohol level was almost five times the legal limit for driving, though probably pretty close to that of many people getting drunk in their garage while listening to music.

    Nonetheless, jurors found Newman, who had already cleared by a grand jury of criminal conduct, not guilty of  “unreasonable, negligent and excessive” force under Florida’s black-guys-are-scary law.

    Jurors were also asked to determine the amount of compensation to award Hill’s three children for their loss; the family was seeking $500,000, but jurors instead opted to give them $4 total – $1 to his mother for his funeral expenses, and $1 to each of his children.

    The grievous punchline: The jury unfathomably found Hill 99% liable for his own murder because “under the influence of alcoholic beverages to the extent that his normal faculties were impaired” – that death penalty offense again – thus reducing the family’s award, and law enforcement’s liability, to pennies.

    The family’s attorney called the ruling “punitive”; Hill’s family wants a new trial; his fiancée vowed to “keep fighting until I get some justice.”

    On Facebook, the sheriff’s office declared, “We are pleased to see this difficult and tragic incident come to a conclusion” and wished “everyone involved in the case the best.”

    One concise comment summed up the general response: “Murderers.”

  • Portland Punishes Pay-Gap Extremes: Imposes 25% Tax On Firms With High Relative CEO Pay

    Soaring income inequality – among all the ‘inequalities’ – has become the bete noire of many in America as the financialization of society has led to the rich getting richer at the expense of the masses.

    And now, for the first time, micro details about income inequality are being disclosed, as The Economist reports, according to new filings submitted to the Securities and Exchange Commission (SEC), America’s largest publicly listed firms (those worth at least $1bn) on average paid their chief executives 130 times more than their typical workers in 2017.

    The figures are being disclosed for the first time as a result of the Dodd-Frank act, a financial-reform law with a provision requiring listed firms to report the annual compensation of their chief executives, that of their median employees, and the ratio of the two.

    So far, interest in the pay ratios among investors has been fairly limited… 

    However, liberal politicians have proved more enthusiastic, and so following Seattle’s decision to “take their fair share” with a ‘head tax’ in an effort to redistribute corporate wealth to the homeless (to ‘solve’ the housing affordability crisis), lawmakers in Portland, Oregon have decided to take on the income inequality miasma – by charging a business-tax on firms with extreme CEO-to-worker pay ratios:

    • 10% Tax on firms with a CEO-to-Worker ratio over 100-to-1; and a

    • 25% Tax on firms with a CEO-to-Worker ratio over 250-to-1.

    As The Economist notes, lawmakers in at least six states, including California, Illinois and Massachusetts, have considered policies of this sort, too.

    But, it appears, the 0.01% have a plan already in place…

    A law such as this would be impossible to implement if the pay-ratio rule is scrapped.

    In October, in response to an executive order from President Donald Trump to review America’s financial regulation, the Treasury called on Congress to do just that, writing that the information is “not material to the reasonable investor for making investment decisions”.

    Of course, as with the recent exodus from many high-tax states, implementation of this kind of relative success punitive taxation will do nothing but reduce overall tax revenues as firms (and CEOs) leave en masse.

     

  • What's With All The False Alarm Warnings From The Emergency Alert System Lately?

    Authored by Daisy Luther via The Organic Prepper blog,

    In 2018, there have been at least 4 false alarms that have drummed up panic for no reason at all.

    It makes you wonder, what’s with all these false alarms? And how can we actually trust an alert that comes to our phone from the Emergency Alert System at all?

    Hawaii – Nukes

    The first, of course, was Hawaii, on January 13th. That one scared me personally since one of my dearest friends lives there and I knew it was a time when she wouldn’t be up yet in the morning. I frantically tried to reach her and finally woke her up to tell her the news. A missile was on the way to Hawaii and it was NOT a drill.

    The message was sent to cell phones and broadcast on TV and radio stations with the chilling message that residents were to take shelter immediately. Warning sirens went off at resorts and hotels.

    It was bedlam in many parts of the island state. Parents were shoving their children into storm drains. After 47 minutes of terror, another alert told the panicked islanders that this had been a false alarm.

    It turns out that an employee “hit the wrong button” and sent out the alert. However, people affected were reasonably furious that it took so long to correct the error.

    Maine – Tsunami

    The false alarm in Hawaii was barely out of the headlines when another inaccurate alert was sent to residents of Maine. The alert warned people in the coastal city of Portland that a tsunami was incoming.

    (source)

    While it’s not impossible for a coastal town to be threatened by a tsunami, it’s incredibly rare on the East Coast and Maine has suffered only minor events historically. The biggest tsunami wave ever recorded there was 10 feet high in 1926. It flooded the harbor but there were no deaths.

    Despite this, residents near the water were quite rightfully alarmed. It turned out that this was a test message that somehow was accidentally sent as a push notification. AccuWeather and the National Weather Service have both pointed the finger for the error to the other agency.

    “Tsunami warnings are handled with the utmost concern by AccuWeather and it has sophisticated algorithms to scan the entire message, not just header words, as from the time of a warning to the actual event can be mere minutes,” the statement said. “AccuWeather was correct in reading the mistaken NWS codes embedded in the warning. The responsibility is on the NWS to properly and consistently code the messages, for only they know if the message is correct or not.”

    …The National Tsunami Warning Center said it did not issue a tsunami warning, watch or advisory for any part of the United States or Canada Tuesday morning. The center, based in Palmer, Alaska, issues monthly tests to regional weather offices.

    Officials said it appeared to be an issue only with the Accuweather app. (source)

    Alaska – Tsunami

    The tsunami warning a few months later in Alaska held a lot more weight since the area is prone to seismic activity and in an area where tsunamis are a more realistic threat.

    In May, a truncated version of a test message was sent in error and broadcast by local radio and TV stations. This one did not go to the phones of local residents but was picked up by the media. Because it was abbreviated, the words “this is a test” did not show up and therefore were not broadcast.

    What makes matters worse is that earlier in the year, when there was actually a threat after a 7.9 earthquake hit the Gulf of Alaska, the tsunami warning that should have gone out to coastal residents was not received by some Alaskan broadcasters and wireless companies.

    Oregon – Civil Emergency

    Then a couple of days ago, the system in Oregon sent out a mysterious message to Salem residents that had them puzzled and alarmed.

    And that was it – no further information was included. Just that there was an emergency and that they should “prepare for action.”

    Andrew Phelps, the head of Oregon’s emergency management agency, apologized for the “glitch.” It turns out that this time there actually was a critical situation of which people needed to be aware.

    Phelps said late Tuesday that a technical glitch had cut off crucial information: that the alert concerned elevated levels of a natural toxin in a local reservoir. Children and people with compromised immune systems have been told not to drink tap water in the Salem, Oregon, area after an algae bloom caused the spike.

    “The integrated public alert warning system inadvertently defaulted to a generic message,” Phelps said in a video posted on the social media by the Office of Emergency Management. “I apologize for the confusion and the anxiety this incomplete message has caused.” (source)

    Of course, this message left people’s minds racing about the nature of the emergency. Some people were afraid to go outside, fearing an active shooter, while others feared a terror attack. And it turns out, even the agency that sent the alert was baffled, taking 31 minutes to follow up with a message that provided some clarity as to the nature of the emergency.

    Confusion surrounded the initial alert even within the emergency management agency, with a spokesperson telling reporters the message had caught them unawares and state police asking residents via a Facebook post not to call 911 about the alert. (source)

    At that point, people were in panic mode. Stores were quickly emptied of their water supplies and chaos was left in shoppers’ wakes. A reader local to the area sent me a message telling of what had ensued.

    I live in Salem Oregon. This evening at 8:30 pm phones across my state went nuts. We received a vague emergency message. A civil emergency is what they called it. You read that and I don’t care who you are, your attention has been grasped.

    With power still running I took to social media. My feed was hot. People were freaking out. No one knew what was going on. Finally, word spread and we discovered our tap water is tainted. With toxic algae! They say safe for adults. (Ummm, no thanks). You can’t boil it away. It’s a firm “don’t give kids under 6, elderly, pets, medically compromised, pregnant, and nursing women any tap water.” Period.

    At 9 pm we received a far more clear emergency text. And the police took to Facebook as evidently 911 was swamped. Its all over the news. Shelves are empty. People are frightened and panicking and it has only been an hour.

    The Emergency Alert System is not working very well.

    The Emergency Alert System (EAS) is overseen by the FCC and can be dispatched locally or even at the national level.

    The Emergency Alert System (EAS) is a national public warning system that requires broadcasters, cable television systems, wireless cable systems, satellite digital audio radio service (SDARS) providers, and direct broadcast satellite (DBS) providers to provide the communications capability to the President to address the American public during a national emergency. The system also may be used by state and local authorities to deliver important emergency information, such as AMBER alerts and weather information targeted to specific areas.

    The FCC, in conjunction with Federal Emergency Management Agency (FEMA) and the National Oceanic and Atmospheric Administration’s National Weather Service (NWS), implements the EAS at the federal level. The President has sole responsibility for determining when the EAS will be activated at the national level, and has delegated this authority to the director of FEMA. FEMA is responsible for implementation of the national-level activation of the EAS, tests, and exercises. The NWS develops emergency weather information to alert the public about imminent dangerous weather conditions. (source)

    The EAS, while a great idea, is sending out so many false alarm warnings that one has to wonder if people will even pay attention in an actual emergency. Theories abound as to why the false alarms are happening, with people pointing fingers toward a wide variety of possibilities:

    • Human error

    • Deliberate manipulation to panic people into being better prepared

    • A cover-up for a system that was hacked

    • In the case of Hawaii, an actual emergency that was quietly diverted

    • Systems errors

    My advice? It’s the same advice I’d give in any situation. If you think there could be a threat, don’t panic, take the appropriate action, and wait to see how things play out.

    But one thing is sure. There are only so many false alarms that can be sent out before the EAS loses all effectiveness. Pretty soon, if not already, people will just roll their eyes and carry on with their days instead of taking action. And if that’s the case, our apathetic society will become even less interested in being prepared for emergencies. There are only so many times you can be spurred to panic for no reason until you’re immune to that particular voice crying “wolf.”

    One day when a real disaster is inbound, nobody will pay attention to what is “probably” just another false alarm.

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Jun 01

Today’s News 1st June 2018

  • Facebook Use Among Teens Plummets 30% In Three Years

    Facebook, which has until recently dominated the social media landscape among America’s youth, is now just the fourth most popular online platform among teens between ages 13 and 17, with just 51% saying they use it, according to a new survey from the Pew Research Center. Facebook use among teens pales in comparison to YouTube (85%), Instagram (72%) and Snapchat (69%). Twitter is fifth with just 32% of teens reporting using the platform. 

    The decline in Facebook use is stunning compared to Pew’s 2014-2015 study, in which 71% of teens reported being Facebook users, and other platforms such as Instagram and Snapchat were nowhere near today’s figures, at 52% and 41% respectively.

    Meanwhile 95% of teens now have a smartphone or access to one, while 45% of teens say they are online on a near-constant basis, fueling ever-growing online activities.

    This shift in teens’ social media use is just one example of how the technology landscape for young people has evolved since the Center’s last survey of teens and technology use in 2014-2015. Most notably, smartphone ownership has become a nearly ubiquitous element of teen life: 95% of teens now report they have a smartphone or access to one. These mobile connections are in turn fueling more-persistent online activities: 45% of teens now say they are online on a near-constant basis. –Pew

    Breaking down teen use of Facebook by household income, 70% of teens from households making under $30,000 per year report using Facebook, while just 36% of teens from households making $75,000 or more are on the platform. 

    Notably, lower-income teens are more likely to gravitate toward Facebook than those from higher-income households – a trend consistent with previous Center surveys. Seven-in-ten teens living in households earning less than $30,000 a year say they use Facebook, compared with 36% whose annual family income is $75,000 or more. -Pew

    How teens view the impact of social media

    Pew also asked the teenagers how they thought the use of social media affected their lives – and found no clear consensus. 

    A plurality of teens (45%) believe social media has a neither positive nor negative effect on people their age. Meanwhile, roughly three-in-ten teens (31%) say social media has had a mostly positive impact, while 24% describe its effect as mostly negative.

    Given the opportunity to explain their views in their own words, teens who say social media has had a mostly positive effect tended to stress issues related to connectivity and connection with others. Some 40% of these respondents said that social media has had a positive impact because it helps them keep in touch and interact with others. Many of these responses emphasize how social media has made it easier to communicate with family and friends and to connect with new people: -Pew

    “I think social media have a positive effect because it lets you talk to family members far away.” (Girl, age 14)

    “I feel that social media can make people my age feel less lonely or alone. It creates a space where you can interact with people.” (Girl, age 15)

    Others in this group cite the greater access to news and information that social media facilitates (16%), or being able to connect with people who share similar interests (15%):

    “My mom had to get a ride to the library to get what I have in my hand all the time. She reminds me of that a lot.” (Girl, age 14)

    “It has given many kids my age an outlet to express their opinions and emotions, and connect with people who feel the same way.” (Girl, age 15)

    Smaller shares argue that social media is a good venue for entertainment (9%), that it offers a space for self-expression (7%) or that it allows teens to get support from others (5%) or to learn new things in general (4%).

    “[Social media] allows us to communicate freely and see what everyone else is doing. [It] gives us a voice that can reach many people.” (Boy, age 15)

    There is slightly less consensus among teens who say social media has had a mostly negative effect on people their age. The top response (mentioned by 27% of these teens) is that social media has led to more bullying and the overall spread of rumors.

    “People can say whatever they want with anonymity and I think that has a negative impact.” (Boy, age 15)

    “Because teens are killing people all because of the things they see on social media or because of the things that happened on social media.” (Girl, age 14)

    Video Games

    84% of teens say they own or have access to a game console at home, and 90% say they play video games of any kind (whether on a computer, game console or cell phone). 

    While a substantial majority of girls report having access to a game console at home (75%) or playing video games in general (83%), those shares are even higher among boys. Roughly nine-in-ten boys (92%) have or have access to a game console at home, and 97% say they play video games in some form or fashion.

    There has been growth in game console ownership among Hispanic teens and teens from lower-income families since the Center’s previous study of the teen technology landscape in 2014-2015. The share of Hispanics who say they have access to a game console at home grew by 10 percentage points during this time period. And 85% of teens from households earning less than $30,000 a year now say they have a game console at home, up from 67% in 2014-2015. -Pew

    Read the report here: 

  • The Sinister Choreography Of The MH17 Probe To Smear Russia

    Authored by Finian Cunningham via The Strategic Culture Foundation,

    The Dutch-led probe into the 2014 Malaysian airliner disaster has the hallmarks of a psychological operation to frame-up Russia and to justify further sanctions and aggression from the NATO powers.

    The so-called Joint Investigation Team (JIT) released an update last Thursday on its ongoing probe into the MH17 air disaster over Eastern Ukraine, in which all 298 people onboard were killed. The JIT’s latest release moves the accusation of culpability closer to Russia, with the team claiming that an anti-aircraft Buk missile, which allegedly shot down the plane, was brought into Ukraine by Russia’s 53rd Brigade based in Kursk, southwest Russia.

    Then on Friday, the day after the high-profile JIT presentation, a news report compiled by US-based McClatchy News and UK-based self-styled online investigative website Bellingcat was published claiming to have identified a senior Russian military intelligence (GRU) officer as being involved in the transport of the missile system.

    The Russian GRU officer is named as Oleg Vladimirovich Ivannikov. The report includes a photograph of the named man, who is said to have at least one residential address in Moscow and who used the call sign “Orion”. Tellingly, the McClatchy report claims that news of identifying the Russian military officer was not known by the JIT when it made its presentation the day before. But McClatchy reported that the Dutch-led investigators now want to arraign “Orion”.

    Over the weekend, the Dutch, Australian and British governments upped the ante by formally accusing Russia, and demanding that Moscow pay financial compensation to families of the crash victims.

    Most of those onboard the doomed MH17 were Dutch, Malaysian and Australian nationals.

    What we are seeing here is a choreographed sequence trying to give the public impression that developments in the probe are taking a natural course based on “evidence” imputing blame to Russia. The same technique of media psychological operation can be seen in the Skripal poisoning affair in which Moscow is blamed for trying to assassinate a former spy in England. Allegations, purported evidence, and then sanctions (expulsion of Russian diplomats) all follow a choreographed sequence.

    On the MH17 incident, Russia has vehemently denied any involvement in the passenger plane’s downing. Moscow says its own investigation into the incident points to the Kiev regime’s armed forces as being responsible, possibly using their stock of Soviet-era Buk anti-aircraft missiles. Significantly, Russia’s investigative results have been spurned by the JIT, while Moscow’s offers of contributing to the probe have been rebuffed. As in the Skripal affair, where the British authorities have also refused Russia’s offers of joint investigation, or Russia’s ability to independently verify the supposedly incriminating data.

    In a dramatic twist, Russia’s Ministry of Defense said that the missile casing displayed by the Dutch investigators bore features dating the weapon to 1986 when Ukraine was a Soviet Republic. The Russian military said that all such Buk models were replaced by its forces in 2011. Therefore, the alleged offensive weapon presented by the JIT last week could not have come from Russian forces. Besides, Moscow denies that any of its brigades crossed into Ukrainian territory.

    The JIT, which includes investigators from Holland, Belgium, Australia, Malaysia and – invidiously – Ukrainian secret services, openly acknowledged in its presentation last week that it is cooperating with the Britain-based Bellingcat website. The latter is cited for its analysis of videos purporting to show the transport of a Russian military Buk convoy through Eastern Ukraine at around the time of the airliner being shot down. Those videos have already been exposed as fabrications.

    Now it seems rather strange that the JIT was reported by McClatchy as not knowing of Bellingcat’s next “scoop” published the following day in which it claims to identify a Russian military officer, named as Oleg Ivannikov or Orion, for being involved in coordinating the transport of the Buk convoy, which the JIT says came from the 53rd Brigade in Russia’s Kursk.

    The JIT and Bellingcat have collaborated in a previous update to its MH17 probe, in 2016, when the dubious videos were presented as purportedly showing the Buk convoy traversing Eastern Ukraine back to Russia. Bellingcat was cited again in the JIT’s update last Thursday.

    That raises the question of why the information claiming to identify the Russian military officer was not available to JIT, even though the latter has worked closely with Bellingcat before? It was the next day when the McClatchy-Bellingcat news report came out, seemingly separate to the JIT presentation.

    The sequence suggests a concerted effort to “build” a public perception that “clues” into the cause of the air crash and the incrimination of Russia are being assembled in an independent manner. When, in reality, the sequence is actually a deliberately orchestrated media campaign, to more effectively smear Russia.

    Bellingcat’s media activities indicate that it is not the supposed “independent online investigative website” it claims to be. During the Syrian war, it has helped to peddle claims that videos sourced from the White Helmets are “authentic” when in fact there is strong evidence that the White Helmets have been fabricating videos of atrocities on behalf of NATO-sponsored terrorists in order to smear the Syrian government and its Russian ally.

    For the Dutch-led JIT to associate with Bellingcat as a source of “evidence” is a matter of grave concern as to the probe’s professional credibility.

    Moreover, what is also fatally damaging to the MH17 probe is that the Ukrainian secret services (SBU) under the control of the Western-backed Kiev regime, which came to power in the NATO-backed February 2014 coup d’état, is the source for much of the so-called evidence implicating Russia or the pro-Russian separatists in Eastern Ukraine for shooting down the MH17 airliner.

    The dubious videos cited by the JIT and Bellingcat were sourced from the SBU. Those videos were purportedly posted on social media at the time of the plane crash by anonymous members of the public. The Russian government has dismissed those videos as fake.

    The latest claims by McClatchy and Bellingcat of identifying a Russian military officer are based on allegations that mobile phone intercepts are attributable to the man named as Orion. Bellingcat appears to have expended a lot of effort trawling through digital phone books to identify the individual. The report also relies on embellishment of Orion’s alleged secret military career in Ukraine and South Ossetia by way of lending a sense of credibility and sinister innuendo.

    However, the bottomline is that McClatchy and Bellingcat both admit that they are relying on the Ukrainian secret services for their phone intercepts, as they had previously for the videos of the alleged Russian Buk convoy.

    The SBU and its Kiev masters have an obvious axe to grind against Moscow. Their partisan position, not to say potential liability for the air crash, thus makes the JIT and subsequent Western media reporting highly suspect.

    Such close involvement of a Western media outlet (McClatchy) with a fake news engine (Bellingcat) and Ukrainian state intelligence is indicative of coordinated public psychological operation to smear Russia.

    The prompt responses from Western governments calling for criminal proceedings against Moscow are further indication that the whole effort is an orchestrated campaign to frame-up Russia.

  • Death Of American Exceptionalism – China Overtakes America In "Healthy Life Expectancy"

    For the first time ever, China has overtaken America in healthy life expectancy at birth, according to a new report. “Healthy life expectancy” is defined by years lived in good health or without significant illness.

    The report, from the World Health Organization (WHO), reveals Chinese newborns could experince 68.7-years of healthy life ahead of them, compared to just 68.5-years for American babies. While the margin between healthy life for both countries is minuscule, the crossover represents the understanding that America is in decline.

    Though Americans born in 2018 can still expect a longer life — 78.5-years to be exact, compared to China’s 76.4-years; however, the last ten years of an American’s life is usually plagued with significant health-related problems.

    “The lost years of good health that are a factor in calculating healthy life expectancy at birth are lower for China, Japan, Korea and some other high-income Asian countries than for high income ‘Western’ countries,” said WHO spokeswoman Alison Clements-Hunt.

    The data also shows that America is one of the only five countries, along with Afghanistan, Georgia, Grenadines, Saint Vincent, and Somalia, where healthy life expectancy at birth is reversing.

    Since 2005, the outlook for Singaporean babies has never been better, who can live free of significant health-related issues until 76.2-years, followed by Japan, Spain, and Switzerland.

    In overall global life expectancy rankings, America places 40th among all other countries, while China ranks 37th.

    China has seen a dramatic improvement in overall life expectancy in recent years. Meanwhile, overall life expectancy in the United States peaked in 2014 at 79-years, which Reuters calculates that China could overtake the United States around 2027.

    “Chinese life expectancy has increased substantially and is now higher than for some high-income countries,” said Clements-Hunt.

    The WHO’s numbers reflect that something is not quite right in America. The Centers for Disease Control (CDC) confirmed in December that the average American life expectancy at birth declined in 2016 for the second consecutive year – the first multiyear decline since 1963, when a flu epidemic led to a rash of deaths as hundreds of thousands of elderly Americans succumbed to the virus.

    Clements-Hunt believes drug overdoses and worsening wealth inequality could be some of the trends responsible for declining American life expectancy.

    “The increasing rates of drug overdose deaths, mainly from opioids, suicides, and some other major causes among younger middle-aged Americans, particularly in less affluent area,” she said.

    While it is no mystery that American Exceptionalism is declining, China, on the other hand, is gradually accelerating with a healthier workforce that will be the needed energy in its economy to dethrone the American Empire in the next decade. Significant changes are coming to the global economy and while today’s data from the WHO does not seem substantial, remember, a critical component of any economy besides robots is the human factor.

  • Lawsuit Exposes How The Government's "Justice" System Keeps The Poor, Poor

    Authored by Mac Slavo via SHTFplan.com,

    It’s not a secret that government’s want to seize as much from the producers as possible to bloat their power-hungry heads.  But a new lawsuit is actually giving the details on just how the government uses the “justice” system to keep the poor in dire states of poverty.

    The ACLU of North Carolina, the Southern Poverty Law Center, and the Southern Coalition for Social Justice have slapped the state of North Carolina with a federal lawsuit over the state’s practice of suspending drivers’ licenses over unpaid tickets.

    According to Splinter News, in North Carolina, the DMV (Department of Motor Vehicles) is required by state law to automatically revoke a license after it receives notice from the court that a person has failed to pay their fines or penalties or associated costs. The lawsuit alleges that this state law violates the Fourteenth Amendment.

    The Fourteenth Amendment reads:

    All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the state wherein they reside. No state shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any state deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.

    The two plaintiffs in the case are 27-year old Seti Johnson and 31-year old Sharee Smoot. According to the lawsuit, Johnson is unemployed and can’t afford to pay off a traffic ticket as well as support his three children. He was able to save up $700 to get his license back last year, but before he was able to finally pay it off, he was hit with another ticket for $100 plus $208 in court costs. He covered the $100 ticket, but still owes $228 in court costs, and will lose his license sometime around the end of July. Although Johnson just got a new job, the lawsuit says, “he will have to either forego the job and figure out a different way to get his children to school, daycare, and the doctor’s office, or he will have to illegally drive.”

    “I’d previously fallen behind on my rent and sacrificed the needs of my children just to keep my license,” Johnson said in a statement provided by the ACLU of North Carolina. “I cannot afford to do that again. This has to stop.”

    Smoot, a single mother who works at a call center 45 minutes away from her home to help support her grandmother as well as her nine-year-old daughter said:

    “I just want a fair chance to take care of my family. I can’t afford to pay the tickets right now, but that shouldn’t prevent me from having a driver’s license.”

    However, this is a national problem not limited to North Carolina and stems from law enforcement looking to extort money for victimless crimes, and having the state in charge of driver’s licenses. In fact, a Washington Post report from earlier this month found that over 7 million people around the country may have had their licenses revoked for traffic debt-related reasons, although that number could be much higher. It’s just another way that both law enforcement and the justice department, as a whole, kneecaps the poor.

    To read about how it all began, see here.

    Extorting money from people for victimless crimes (most traffic violations are victimless) does not function to prevent any violent crime or crime with victims. The drug war does not help anyone, and the era of time in which the people of the US were most free, proves that this is the formula for prosperity. Even given the vastly different technology and capabilities of today, it would seem that this formula of freedom for prosperity would add up.

    The problem is, we aren’t free and haven’t been for quite some time.  And no matter who gets elected, we get more police, more violence, more “criminals”, and higher taxes. 

    But, it is time we began opening our eyes to the issue instead of repeating the “we’re free” lie. The best way to end poverty is not to throw money at it but to increase the rights and freedoms of everyone.

    And in case you were wondering just how much all this newly militarized policing costs the average joe taxpayer, Statista’s Niall McCarthy notes that approximately $6 billion of excess Department of Defense property has been transferred to U.S. law enforcement agencies since 1990. Under the 1033 Program, all sorts of items from laptops to assault rifles have been passed from the military to the police. These fall into two categories – controlled items (like drones or helicopters) and uncontrolled items (like office furniture and tools).

    Even though police militarization has become increasingly controversial, particularly in the wake of Ferguson when mine-resistant vehicles and heavily armed officers appeared on the streets, the flow of weaponry has continued without interruption. A recent RAND analysis of the situation found that in fiscal years 2015 to 2017, the value of uncontrolled transfers came to $1.2 billion while controlled items had a value of $775 million.

    Infographic: How Much Is The Police's Military Equipment Worth? | Statista

    You will find more infographics at Statista

    RAND found that the current value of all excess Department of Defense items held by law enforcement agencies across the U.S. today stands at $1,888,559,339.

    The infographic above takes a closer look at a selection of equipment from the analysis and how much it’s currently worth. There are 849 mine-resistant vehicles in operation at U.S. police departments and they have a value of just under $583 million. Elsewhere on the list, 64,689 5.56 millimeter rifles have been transferred to law enforcement and they are worth $27.83 million while the grand total for all aircraft in the program comes to around $433 million.

  • Wicked Weather: Midwest Jumps From Coldest April To Hottest May On Record

    “After an incredibly chilly April, May rebounded significantly, featuring record heat late in the month across the Midwest and while not official yet, May could go down as the warmest May on record nationally thanks to this late-month heat surge.

    A plethora or heat records were broken this past weekend, including Minneapolis, MN soaring to 100°F. This broke the record daily record for May 28 and reaching 100°F for only the second time in recorded history. This intense heat has since abated, but more above normal temperatures are expected into early June across a majority of the Plains and Midwest,” explained Ed Vallee, head meteorologist at Vallee Weather Consulting.

    “April featured record-breaking cold, particularly across the Upper Midwest, compared to normal. May has rebounded significantly with record heat this past weekend in the Midwest, and above normal temperatures across a majority of the country,” Vallee added.

    According to the weather desk of Radiant Solutions, “Memorial Day weekend felt more like the peak of summer for many in the Central US.” Here are some peak highs from earlier this week:

    • Chicago set record highs of 97 and 95 degrees Sunday and Monday, only the second time it has endured back-to-back 95 degree days in May on record.

    • Milwaukee and Toledo established record highs for May of 95 degrees (Sunday) and 98 degrees (Monday), respectively.

    • Omaha and Green Bay, Wis., set record highs on four straight days Friday to Monday.

    • Des Moines set record highs on three straight days Saturday to Monday, including its earliest 99-degree reading on record Sunday.

    • Muskegon, Mich., hit 96 degrees Tuesday, a monthly record.

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    Jonathan Erdman, a Weather Channel Meteorologist, said over 1,900 daily heat records were tied or broken across the United States in late May.

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    During the course of May, above average temperatures covered almost the entire Continental United States.

    Last week, a preliminary analysis showed that a drought developing in the Southwest could be on par with the Dust Bowl era of the 1930s.

    “The epicenter of this drought is where the states of Utah, Colorado, Arizona and New Mexico all come together, but it is also devastating areas of north Texas, Oklahoma and Kansas as well. Portions of seven states are already at the highest level of drought on the scale that scientists use, and summer won’t even start for about another two months.

    If we don’t start seeing some significant rainfall, it won’t be too long before massive dust storms start devastating the entire region. The mainstream media is finally beginning to wake up and start reporting on this crisis, and some reporters are choosing to make a direct comparison between this drought and the Dust Bowl conditions during the Great Depression.”

    Victor Murphy, a National Weather Service Climate Service Program Manager, said, “the avg. monthly temp for the CONUS for May is 64.6F, thru 5/28. NCEI shows the all-time CONUS record being 64.71F in May 1934. With blast furnace temps across much of CONUS next 2 days, the Dust Bowl era record should fall.”

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  • China Holds The Cards In Trump's Trade War

    Authored by Tom Luongo,

    The Trump administration continues to play hardball games with China on trade.  The latest news has China angry over Trump going forward with 25% tariffs on an array of Chinese goods after having reached a deal earlier over phone-maker ZTE.

    As Bloomberg notes, the announcement by Trump, which seemed to tear up an agreement reached only 10 days ago in Washington, is the latest twist in a trade dispute between the U.S. and China that has rattled financial markets for months and could threaten the broadest global upswing in years, according to the International Monetary Fund.

    That said, if Bloomberg is upset about this policy from Trump I’m inclined to be sympathetic.  But, that’s just me being churlish.  Reality is that this kind of behavior only adds fuel to the building devaluation fire building in Beijing.

    I discuss why China can and should aggressively devalue the Yuan over the next few months to assist its central Asian partners, namely Iran and Turkey, resist aggressive U.S. sanctions policy over at Strategic Culture Foundation:

    Secondly, China devalues the Yuan alongside these struggling emerging market countries’ currencies, not to the same degree but enough to still encourage capital inflow into China, to soften the blow and make the Yuan more attractive to procure needed goods in international markets.

    And, since Trump doesn’t dare sanction Chinese banks without destroying the U.S. economy, this is just one of the paths available for countries like Turkey, Iran and the EU-27 to circumvent Trump’s aggressive trade war.

    China’s moves are bigger than simply the petroyuan.

    As I pointed out last week, China is preparing a broad swath of new metals futures contracts through the London Metals Exchange.  This is in addition to the gold futures contract launched last year.

    The more alternatives that countries like Turkey, Venezuela and Iran have to keep their supply chains full  the better they can resist the obvious push towards regime change which is what the sanctions are trying to achieve.

    These moves are subtle.  They operate below the headlines in the practical world of actual markets, not the avaricious dreams of Certified Crazy People like John Bolton, Mike Pompeo and Nikki Haley.

    China’s central bank and its finance ministry are staffed with people who cut their teeth in Western bond and commmodity pits not M.B.A. programs at Ivy League schools.

    It’s one of Trump’s real advantages as a President, his real world experience.  But, it’s also one of his failings as well.  He’s never really run a successful deal on people like the Russians and the Persians.  The former see through his nonsense and the latter he hasn’t been allowed to negotiate with because of U.S. policy.

    It’s a weakness in that he doesn’t get the cultural imperatives and their sense of history.  They are looking at remaking the world for the next century.  Trump is trying to get through the next election.

    *  *  *

    Please support the production of independent and alternative political and financial commentary by joining my Patreon and subscribing to the Gold Goats ‘n Guns Investment Newsletter for just $12/month.

  • Why Turkey And Argentina Are Doomed, In One JPMorgan Chart

    It was all the rage in 2017.

    Not long after contrarians like Jeff Gundlach and Russell Clark said to go long Emerging Markets, suddenly everyone was doing it, either as a standalone trade or as part of a pair trade shorting one or more DMs. Of course, maybe all they were doing was indirectly shorting the USD, which was arguably the biggest driver behind EM outperformance. But, in no small part due to the recent surge in the dollar, after outperforming developed equity markets by 20% in 2016-2017, EM is underperforming by 2.5% so far this year.

    Of course, it’s not just the dollar, but also interest rates, which until the recent Italian fiasco, were at 4 year, or greater, highs.

    And, as JPM’s Michael Cembalest writes in his latest “Eye on the market” note, investor fears are predictably focused on the impact of rising US interest rates and the rising US dollar on EM external debt, and on rising oil prices.

    And yet, despite the occasional scream of terror from EM longs who refuse to throw in the towel, a closer look shows that the market reaction has been orderly so far, with two exceptions: Argentina and Turkey, which are leading the way down. However, as the JPM Asset Management CIO shows below, the collapse in these two countries has been largely a function of state-specific/idiosyncratic reasons.

    The chart below, courtesy of Cembalest, shows each country’s current account (x-axis), the recent change in its external borrowing (y-axis) and the return on a blended portfolio of its equity and fixed income markets (the larger the red bubble, the worse the returns have been). This outcome looks sensible given weaker Argentine and Turkish fundamentals. And while Cembalest admits that the rising dollar and rising US rates will be a challenge for the broader EM space, most will probably not face balance of payments crises similar to what is taking place in Turkey and Argentina, of which the latter is already getting an IMF bailout and the former, well… it’s only a matter of time.

    Below, Cembalest lays out his concise justification why while both Turkey and Argentina appear to be doomed, one should not extrapolate their unique problems to the rest of the EM complex:

    • On Turkey (0.9% of the MSCI EM Index), President Erdogan lost a battle with markets when he finally agreed to  higher interest rates to defend the lira. The big risk, (as we noted earlier in the wee)k, is the inadequacy of Turkish international reserves to cover its short term external debt, particularly since some reserves could evaporate if it looks like capital controls will be imposed. There’s also $80 bn in Spanish bank exposure to Turkish borrowers. Turkey looks like an unstable EM economy of the 1980’s and 1990’s, and is a country whose problems should not be over-generalized. This goes double for Argentina.
    • With Argentina dominating EM headlines again, let’s remember what country we are talking about here and not overgeneralize its problems. As shown above, Argentina spent the last 3 years borrowing an enormous amount of money; it has defaulted on its international debt 7 times since its independence in 1816; and spent most of the last decade in investment purgatory (it was jettisoned from the MSCI EM Equity index into the MSCI Frontier Equity Index alongside countries like Lebanon and Kenya).

    Putting Argentina in context, JPMorgan’s cluster model illustrates how risky the Latin American country has been for investors. In the chart below, the closer countries are to each other, the more similar they are with respect to competitiveness, regulation, investor protections, labor markets and ease of doing business. Like Bangladesh and Zimbabwe, Argentina lies at the outer edge of this known universe, far from other EM countries like China, Peru, Indonesia and Mexico and Vietnam, and lightyears away from the developed world. Only in a world of financial repression by central banks could a country like this issue an oversubscribed 100-year bond.

    And speaking of Argentina’s ill-fated 100-year bond issued less than a year ago, it is already down 20% from its December peak with what JPM says are “are echoes here from 2001, when Argentina issued new debt just a few months before defaulting on it.”

  • Malaysia's Mahathir's Reforms Could Put Saudi, UAE On The Spot

    Authored by James Dorsey via The Turbulent World of Middle East Soccer blog,

    Newly elected Malaysian Prime Minister Mohammed Mahathir is adopting policies that could reshape the Southeast nation’s relations with powerful Gulf states.

    A series of anti-corruption measures as well as statements by Mr. Mahathir and his defense minister, Mohamad (Mat) Sabu, since this month’s upset in elections that ousted Prime Minister Najib Razak from office, are sparking concern in both Saudi Arabia and the United Arab Emirates.

    Mr. Mahathir, who has cautioned in recent years against widespread anti-Shiite sectarianism in Malaysia, has questioned together with Mr. Sabu Malaysia’s counterterrorism cooperation with Saudi Arabia.

    Mr. Mahathir has also reinvigorated anti-corruption investigations of Mr. Razak,  whom Qatari media have described as “Saudi-backed.”

    Mr. Razak is suspected of having syphoned off billions of dollars from state-owned strategic development fund 1Malaysia Development Berhad (1MDB). The fund as well as Saudi and UAE entities allegedly connected to the affair are under investigation in at least six countries, including the United States, Switzerland and Singapore.

    Apparently anticipating a possible change in relations, political scientist Abdulkhaleq Abdulla, whose views are often seen as reflecting UAE government thinking, disparaged Mr. Mahathir and the Malaysian vote days after the results were announced.

    Mr. Abdullah focused on Mr. Mahathir’s age. At 92, Mr. Mahathir is the world’s oldest elected leader.

    Mr Abdulla also harped on the fact that Mr. Mahathir had been Mr. Razak’s mentor before defecting to the opposition and forging an alliance with Anwar Ibrahim, Mr. Mahathir’s former deputy prime minister and an Islamist believed to be close to the Muslim Brotherhood, whom he helped put behind bars.

    UAE Crown Prince Mohammed bin Zayed is known for his intense opposition to political Islam, including the Brotherhood.

    “Malaysia seems to lack wise men, leaders, statesmen and youth to elect a 92-year-old who suddenly turned against his own party and his own allies and made a suspicious deal with his own political opponent whom he previously imprisoned after fabricating the most heinous of charges against him. This is politics as a curse and democracy as wrath,” Mr. Abdulla said on Twitter, two days after the election.

    Similarly, Malaysian officials have signalled changing attitudes towards the Gulf. Seri Mohd Shukri Abdull, Mr. Mahathir’s newly appointed anti-corruption czar, who resigned from the Malaysian Anti-Corruption Commission (MACC) in 2016 as a result of pressure to drop plans to indict Mr. Razak, noted that “we have had difficulties dealing with Arab countries (such as) Qatar, Saudi Arabia, (and the) UAE.”

    Those difficulties are likely to recur.

    Mr. Sabu, the new defense minister, noted in a commentary late last year that Saudi (and UAE) wrath was directed “oddly, (at) Turkey, Qatar, and Iran…three countries that have undertaken some modicum of political and economic reforms. Instead of encouraging all sides to work together, Saudi Arabia has gone on an offensive in Yemen, too. Therein the danger posed to Malaysia: if Malaysia is too close to Saudi Arabia, Putrajaya would be asked to choose a side.”

    Putrajaya, a city south of Kuala Lumpur, is home to the prime minister’s residence and a bridge with four minaret-type piers that is inspired by Iranian architecture.

    Mr. Sabu went on to say that “Malaysia should not be too close to a country whose internal politics are getting toxic… For the lack of a better word, Saudi Arabia is a cesspool of constant rivalry among the princes. By this token, it is also a vortex that could suck any country into its black hole if one is not careful. Indeed, Saudi Arabia is governed by hyper-orthodox Salafi or Wahhabi ideology, where Islam is taken in a literal form. Yet true Islam requires understanding Islam, not merely in its Quranic form, but Quranic spirit.”

    Since coming to office, Mr. Sabu has said that he was reviewing plans for a Saudi-funded anti-terrorism centre, the King Salman Centre for International Peace (KSCIP), which was allocated 16 hectares of land in Putrajaya by the Razak government. Mr. Sabu was echoing statements by Mr. Mahathir before the election.

    The opening of the centre was twice postponed because Saudi Crown Prince Mohammed bin Salman cancelled his planned attendance. Malaysian officials said the kingdom had yet to contribute promised funds for the centre.

    Shahriman Lockman, an analyst with the Kuala Lumpur-based Institute of Strategic and International Studies cautioned that Malaysia would have manoeuvre carefully.

    “Whether we like it or not, whatever we think of them, Saudi Arabia is a major player in the Muslim world and in the Middle East. Their administration of the haj makes it crucial for Muslim-majority countries to get along with them,” Mr. Lockman said.

    The fact that Mr. Mahathir’s election has sparked hopes that he will move Malaysia away from Mr. Razak’s embrace of Saudi-inspired ultra-conservative Islam as a political tool, despite the prime minister’s history of prejudice towards Jews and past anti-Shiite record, is likely to reinforce Saudi and UAE concern that his moves could favour Iran.

    Mr. Mahathir has vacillated in his statements between banning Shiism to avert sectarianism and calling on Sunni Muslims in Malaysia to accept the country’s miniscule Shiite minority as a way of avoiding domestic strife.

    What is likely to concern the Saudis most is the fact that Mr. Mahathir has said that  accepting Shiites as fellow Muslims was necessary because of the growth of the Iranian expatriate community in Malaysia. Analysts say the presence has sparked a greater awareness of Shiism and Sunni animosity because of Mr. Razak’s divisive policies.

    Saudi and UAE worries about the reinvigorated anti-corruption investigation are rooted in the potential implication in the scandal of a Saudi commercial company, members of the Saudi ruling family, and UAE state-owned entities and officials.

    The investigation is likely to revisit 1MDB relationship’s with Saudi energy company PetroSaudi International Ltd, owned by Saudi businessman Tarek Essam Ahmad Obaid as well as prominent members of the kingdom’s ruling family who allegedly funded Mr. Razak.

    It will not have been lost on Saudi Arabia and the UAE that Mr. Mahathir met with former PetroSaudi executive and whistle blower Xavier Andre Justo less than two weeks after his election victory.

    A three-part BBC documentary, The House of Saud: A Family at War, suggested that Mr. Razak had worked with Prince Turki bin Abdullah, the son of former Saudi King Abdullah, to syphon off funds from 1MDB.

    UAE-owned, Swiss-based Falcon Bank has also been linked to the scandal while leaked emails documented a close relationship between Yousef al-Otaiba, the UAE’s high-profile ambassador to the United States and confidante of Prince Mohammed bin Zayed, and controversial Malaysian financier Jho Low, a 27-year-old Wharton graduate who helped Mr. Razak run 1MDB.

    The Wall Street Journal, citing not only emails, but also US court and investigative documents, reported last year that companies connected to Mr. Otaiba had received $66 million from entities investigators say acted as conduits for money allegedly stolen from 1MDB.

    The UAE embassy in Washington declined to comment at the time but admitted that Mr. Oteiba had private business interests unrelated to his diplomatic role. The embassy charged that the leaked emails were part of an effort to tarnish his reputation.

    Khaldoon Al Mubarak, an adviser to the government in Abu Dhabi who has also been implicated in the scandal, was reportedly detained in 2016 without charges and has been held in jail since.

    Bank statements and financial documents reviewed by The Wall Street Journal suggest that Mr. Al Mubarak facilitated the purchase by UAE deputy prime minister Sheikh Mansour Bin Zayed Al Nahyan’s brother of a $500 million yacht with 1MDB funds.

    “The impact of this election will reverberate far beyond Malaysia’s borders,” said Asia director of the Centre for Humanitarian Dialogue Michael Vatikiotis.

    Mr. Vatikiotis was looking primarily at the fallout of Mr. Mahathir’s victory in Southeast Asia and China. His analysis is however equally valid for Saudi Arabia and the United Arab Emirates, where it could also prove to be embarrassing.

  • Comey Grilled As Feds "Seriously" Consider Charging McCabe In Criminal Referral

    Federal investigators from the D.C. U.S. Attorney’s office recently interviewed former FBI director James Comey as part of an ongoing probe into whether former FBI #2 Andrew McCabe broke the law when he lied to federal agents, reports the Washington Post.

    Investigators from the D.C. U.S. Attorney’s Office recently interviewed former FBI director James B. Comey as part of a probe into whether his deputy, Andrew McCabe, broke the law by lying to federal agents — an indication the office is seriously considering whether McCabe should be charged with a crime, a person familiar with the matter said. –Washington Post

    What makes the interview particularly interesting is that Comey and McCabe have given conflicting reports over the events leading up to McCabe’s firing, with Comey calling his former deputy a liar in an April appearance on The View. 

    Justice Department Inspector General Michael Horowitz issued a criminal referral for McCabe following a months-long probe which found that the former acting FBI Director leaked a self-serving story to the press and then lied about it under oath. McCabe was fired on March 16 after Horowitz found that he “had made an unauthorized disclosure to the news media and lacked candor – including under oath – on multiple occasions.” 

    Specifically, McCabe was fired for lying about authorizing an F.B.I. spokesman and attorney to tell Devlin Barrett of the Wall St. Journal – just days before the 2016 election, that the FBI had not put the brakes on a separate investigation into the Clinton Foundation, at a time in which McCabe was coming under fire for his wife taking a $467,500 campaign contribution from Clinton proxy pal, Terry McAuliffe. 

    The WSJ article  reads:

    New details show that senior law-enforcement officials repeatedly voiced skepticism of the strength of the evidence in a bureau investigation of the Clinton Foundation, sought to condense what was at times a sprawling cross-country effort, and, according to some people familiar with the matter, told agents to limit their pursuit of the case. The probe of the foundation began more than a year ago to determine whether financial crimes or influence peddling occurred related to the charity.

    …

    Some investigators grew frustrated, viewing FBI leadership as uninterested in probing the charity, these people said. Others involved disagreed sharply, defending FBI bosses and saying Mr. McCabe in particular was caught between an increasingly acrimonious fight for control between the Justice Department and FBI agents pursuing the Clinton Foundation case.

    So McCabe was found to have leaked information to the WSJ in order to combat rumors that Clinton had indirectly bribed him to back off the Clinton Foundation investigation, and then lied about it four times to the DOJ and FBI, including twice under oath. 

    McCabe vs. Comey

    Investigators from the D.C. U.S. Attorney’s office were likely to be keenly interested in Comey’s version of whether or not he knew about McCabe’s disclosure. 

    Comey and McCabe offered varying accounts of who authorized the disclosure for the article. They discussed the story the day after it was published, and Comey, according to the inspector general’s report, told investigators McCabe “definitely did not tell me that he authorized” the disclosure. -WaPo

    “I have a strong impression he conveyed to me ‘it wasn’t me boss.’ And I don’t think that was by saying those words, I think it was most likely by saying ‘I don’t know how this s— gets in the media or why would people talk about this kind of thing,’ words that I would fairly take as ‘I, Andy, didn’t do it,’ ” Comey said, according to the inspector general.

    During an April appearance on ABC’s The View to peddle his new book, A Higher Royalty Loyalty, where he called McCabe a liar, and said he actually “ordered the [IG] report” which found McCabe guilty of leaking to the press and then lying under oath about it, several times. 

    Comey was asked by host Megan McCain how he thought the public was supposed to have “confidence” in the FBI amid revelations that McCabe lied about the leak. 

    “It’s not okay. The McCabe case illustrates what an organization committed to the truth looks like,” Comey said. “I ordered that investigation.” 

    Comey then appeared to try and frame McCabe as a “good person” despite all the lying. 

    “Good people lie. I think I’m a good person, where I have lied,” Comey said. “I still believe Andrew McCabe is a good person but the inspector general found he lied,” noting that there are “severe consequences” within the DOJ for doing so.

    https://platform.twitter.com/widgets.js

    Following McCabe’s firing, his attorney Michael R. Bromwich (flush with cash from the disgraced Deputy Director’s half-million dollar legal defense GoFundMe campaign), fired back – claiming that Comey was well aware of the leaks. 

    “In his comments this week about the McCabe matter, former FBI Director James Comey has relied on the Inspector Genera’s (OIG) conclusions in their report on Mr. McCabe. In fact, the report fails to adequately address the evidence (including sworn testimony) and documents that prove that Mr. McCabe advised Director Comey repeatedly that he was working with the Wall Street Journal on the stories in question…” reads the statement in part. 

    McCabe vs. the DOJ

    McCabe may also find himself at odds with the Department of Justice, as notes he kept allegedly detailing an interaction with Deputy Attorney General Rod Rosenstein raise questions about a memo Rosenstein wrote justifying Comey’s firing. While Rosenstein’s memo took aim at Comey for his mishandling of the Clinton email investigation, McCabe’s notes suggest that Trump told Rosenstein to point to the Russia investigation. Rosenstein’s recommendation ultimately did not mention Russia. 

    McCabe’s interactions with Rosenstein could complicate any potential prosecution of McCabe because Rosenstein would likely be involved in a final decision on filing charges. McCabe has argued that the Justice Department’s actions against him, including his firing, are retaliatory for his work on the Russia investigation. -WaPo

    As the Washington Post notes, lying to federal investigators can carry a five-year prison sentence – however McCabe says he did not intentionally mislead anyone. The Post also notes that while Comey’s interview is significant, it does not indicated that prosecutors have reached any conclusions. 

    Lying to Comey might not itself be a crime. But the inspector general alleged McCabe misled investigators three other times.

    He told agents from the FBI inspection division on May 9, 2017, that he had not authorized the disclosure and did not know who had, the inspector general alleged. McCabe similarly told inspector general investigators on July 28 that he was not aware of one of the FBI officials, lawyer Lisa Page, having been authorized to speak to reporters, and because he was not in Washington on the days she did so, he could not say what she was doing. McCabe later admitted he authorized Page to talk to reporters.

    The inspector general also alleged that McCabe lied in a final conversation in November, claiming that he had told Comey he had authorized the disclosure and that he had not claimed otherwise to inspection division agents in May.

    Michael Bromwich replied in a statement: “A little more than a month ago, we confirmed that we had been advised that a criminal referral to the U.S. Attorney’s Office had been made regarding Mr. McCabe. We said at that time that we were confident that, unless there is inappropriate pressure from high levels of the Administration, the U.S. Attorney’s Office would conclude that it should decline to prosecute. Our view has not changed.

    He added that “leaks concerning specific investigative steps the US Attorney’s Office has allegedly taken are extremely disturbing.”

    Whatever Comey told federal investigators, we suspect it eventually boiled down to “McCabe didn’t tell me,” squarely placing responsibility for the leaks – and the lies, on McCabe’s shoulders. 

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May 31

Today’s News 31st May 2018

  • US, Turkey Said To Reach Deal For Withdrawal Of Kurdish Forces From Key Syrian Town

    Turkey has announced a new agreement with the US which will involve the pullout of all Kurdish forces from the contested northern Syrian city of Manbij — something which the US State Department disputed as recently as Tuesday.  

    The newly built US forces base in Manbij, Syria. Image source: TRT World via Reuters

    But Reuters now reports, based on Turkey’s state-run Anadolu agency:

    Turkey and the United States have reached an agreement on a plan for the withdrawal of the Syrian Kurdish YPG militia from Syria’s Manbij, Turkey’s state-run Anadolu news agency said on Wednesday.

    Under the terms of the three-step plan, which will become finalized during a visit by Foreign Minister Mevlut Cavusoglu to Washington on June 4, the YPG will withdraw from Manbij 30 days after the deal is signed, Anadolu said.

    Turkish and US military forces will start joint supervision in Manbij 45 days after the agreement is signed and a local administration will be formed 60 days after June 4, Anadolu said.

    Turkish Foreign Minister Mevlüt Çavuşoğlu previously indicated, “A roadmap for the Syrian city of Manbij may be implemented before the end of this summer if a deal is reached between Turkey and the US”, according to statements reported by Middle East based Al Masdar News. “Taking over the city will last until a new administration is formed as per an agreement with the United States,” he commented.

    However, as of Tuesday the State Department denied reaching an agreement with Turkey on the issue, indicating that talks were still ongoing.

    When asked about Turkish press claims of the deal from earlier this week, State Department spokeswoman Heather Nauert responded, “[the US doesn’t] have any agreements yet with the Government of Turkey. We announced previously that the United States and the Turkish working group met in… Ankara on [May 25]. We’re continuing to have ongoing conversations regarding Syria and other issues of mutual concern.”

    “The two sides then had outlined the contours of a road-map for further cooperation, and that includes on Manbij. I know that the Secretary looks forward to hosting Foreign Minister Cavusoglu on June 4th here in Washington for those conversations to continue,” she added.

    Syrian Kurdish media groups, most notably the Manbij Military Council, have disparaged claims of a US-Turkish deal for the withdrawal of the YPG (or Kurdish “People’s Protection Units”) as ‘fake’, denying any Kurdish withdrawal. The US-backed and largely Kurdish Syrian Democratic Forces captured the city from ISIS in August 2016 after hard fought 2-month battle and with heavy support from US coalition aircraft.

    Sharfan Darwish, spokesman for the Manbij Military Council, called Wednesday’s reports of the US-Turkish deal “premature” and that news of the deal “lacks credibility,” and said further, “The Turkish statements are a way of exerting pressure and creating confusion in Manbij, impacting its stability.”

    The Manbij Military Council is an extension of the US-backed Syrian Democratic Forces (SDF), and US advisers have long been present in the Syrian Kurdish dominated town, with new images emerging in early May depicting ongoing construction on a US forward operating base. 

    NATO member Turkey has twice threatened to attack US-occupied Manbij following Turkey’s annexation of Syria’s Kurdish dominated town of Afrin early this year. Turkey has long accused Washington of effectively aiding the outlawed “terrorist” Kurdish PKK due to its policies in Syria. 

    Meanwhile Turkish Foreign Minister Mevlut Cavusoglu is set to travel to Washington D.C. where he will meet with Secretary of State Mike Pompeo on June 4th. The two are expected to tackle the thorny issue of US support for Syrian Kurdish groups which Ankara sees as identical with the PKK, but which the US sees as a distinct Syrian ally against both ISIS and Assad. 

  • British Judge Says Kitchen Knives Are Too Sharp: Filing Them Down Will Stop Stabbing Epidemic

    Authored by Mac Slavo via SHTFplan.com,

    This is a look into the future of the United States.  Although the anti-gun nuts in the US are focusing on ‘assault weapons’ those in the United Kingdom want to curb knife violence in their anti-gun utopia by ‘filing down’ the knives that are too sharp.

    A judge in the UK has proposed a nationwide program to file down the points of kitchen knives as a solution to the country’s soaring knife crime epidemic. Because filing down the knives people use to cut their vegetables will stop criminals from stabbing others with those now duller knives.

    According to The Telegraph UK, in his valedictory address last week, retiring Luton Crown Court Judge Nic Madge spoke of his concern that carrying a knife had become routine in some circles and called on the government to ban the sale of large pointed kitchen knives.  In the gun free zone that is the United Kingdom, the latest figures show stabbing deaths among teenagers and young adults have reached the highest level for eight years, and knife crime overall rose 22 percent in 2017. If you’ve ever wondered just how tyrannical things have gotten across the pond.

    In the past two months, he said, there have been 77 knife-related incidents in Bedfordshire, including three killings.  So a ban on guns turned violent homicidal maniacs into knife-wielding, stab-hungry sociopaths.  On top of the increased bans and laws on knives, the UK is actually punishing its own people for having the nerve to defend themselves or their property from grave bodily harm. 

    Judge Madge told the assembled  judges, barristers, and court staff:

    “These offenses often seem motiveless – one boy was stabbed because he had an argument a couple of years before at his junior school.”

    He also said the laws which were designed to reduce the availability of weapons to young would-be offenders had had “almost no effect” on stabbing violence since the vast majority of had merely taken the knives from a cutlery drawer. 

    “A few of the blades carried by youths are so-called ‘Rambo knives’ or samurai swords. They though are a very small minority. The reason why these measures have little effect is that the vast majority of knives carried by youths are ordinary kitchen knives. Every kitchen contains lethal knives which are potential murder weapons.”

    Even better, the judge used the same argument we get from anti-gun activists in the United States. “Why do you need that?” Judge Madge said: “Accordingly, it is very easy for any youth who wants to obtain a knife to take it from the kitchen drawer in his home or in the home of one of his friends.” As a result, according to the judge, the most common knife a youth will take out is eight to ten inches, long and pointed, from his mother’s cutlery tray.

    “But why we do need eight-inch or ten-inch kitchen knives with points? Butchers and fishmongers do, but how often, if at all, does a domestic chef use the point of an eight-inch or ten-inch knife? Rarely, if at all.”  

    Sound familiar?

  • After Years Of US-Led "Nation-Building", Afghanistan Faces A Human Rights Disaster

    Authored by Brian Cloughley via The Strategic Culture Foundation,

    After over sixteen years of foreign military occupation, Afghanistan, the fourth most corrupt country in the world, continues to be battered and blasted by war. Its citizens are victims of suicide attacks by insane savages and, according to the magazine Stars and Stripes, the number of US bombs dropped on Afghanistan in March 2018 “was the highest for that month in five years. While ISIS is being pushed underground in Iraq and Syria, the number of fighters pledging loyalty to the group appears to be growing in Afghanistan.”

    But it isn’t only the ravages of war that are destroying the country. The social fabric is being terminally torn asunder by human rights violations that are either ignored or condoned by both the government and the US-NATO  military alliance amongst whose “key functions” is “Supporting the adherence to the principles of rule of law and good governance.”

    The US Special Inspector General for Afghanistan Reconstruction (SIGAR), Mr John Sopko, has for eight years carried out his duties in an exemplary fashion, being responsible for “independent and objective oversight of the $117.26 billion the US has provided to implement reconstruction programs in Afghanistan,” but has been frequently deflected and misled by the US Department of Defence and the Afghan government.

    SIGAR’s Report of July 2017 recorded that “Afghan officials remain complicit… in the sexual exploitation of children by Afghan security forces,” but as noted by the Washington Post, “the Pentagon tried to block an independent assessment of child sex abuse crimes committed by Afghan soldiers and police, instead insisting on the creation of its own report offering a far less authoritative review of human rights violations perpetrated by US allies.”

    It is now public knowledge that there is a culture of sodomy in Afghanistan and that Afghan men in positions of power at all levels enjoy immunity from prosecution for abusing young boys.  The practice of bacha bazi, or “boy play” is revolting, and the word “play” is entirely inappropriate. Foreign Policy magazine states that “Demeaning and damaging, the widespread subculture of paedophilia in Afghanistan constitutes one of the most egregious ongoing violations of human rights in the world. The adolescent boys who are groomed for sexual relationships with older men are bought — or, in some instances, kidnapped — from their families and thrust into a world which strips them of their masculine identity. These boys are often made to dress as females, wear makeup, and dance for parties of men. They are expected to engage in sexual acts with much older suitors, often remaining a man’s or group’s sexual underling for a protracted period.”

    But the Pentagon doesn’t want us to know anything about this, and has in the past actually punished US soldiers for taking action against bullying perverts.  The New York Times reported in 2015 that after special forces Captain Dan Quinn “beat up an American-backed militia commander for keeping a boy chained to his bed as a sex slave” he was relieved of his command.  He said later that “We were putting people into power who would do things that were worse than the Taliban did,” which is absolutely correct, because even the barbaric Taliban did not permit such criminal obscenity to go unpunished.  

    Sexual abuse of boys in Afghanistan continues unchecked in spite of the SIGAR’s criticisms and regardless of the international “Convention on the Rights of the Child” which requires nations who ratify the agreement to “undertake to protect children from all forms of sexual exploitation and sexual abuse.”

    The United States, however, has not ratified the Convention, which means that it is not legally bound by any of its requirements.  As The Economist observes, the US lawmakers who oppose the treaty “say it would usurp American sovereignty, a long-standing fear about the UN among some conservative Republicans. There is a fear that the social and economic rights established by the treaty could provoke lawsuits demanding that the government pay for these things.”   It is not surprising that the Pentagon has done nothing at all to oppose gross abuse of children in Afghanistan.

    Then there is the scandalous treatment of women in that corrupt and shattered country, where in 2009 a law was passed permitting men to starve their wives to death if they deny them sex. In 2014, after another five years of US-NATO support of “adherence to the principles of rule of law and good governance” the Kabul parliament approved a law which allows men “to attack their wives, children and sisters without fear of judicial punishment, undoing years of slow progress in tackling violence in a country blighted by so-called ‘honour’ killings, forced marriage and vicious domestic abuse.” 

    Amnesty International’s 2017-2018 Report informs us that “In the first half of [2017] the Afghanistan Independent Human Rights Commission reported thousands of cases of violence against women and girls across the country, including beatings, killings and acid attacks. Against the backdrop of impunity for such crimes and a failure to investigate, cases of violence against women remained grossly under-reported due to traditional practices, stigmatization and fear of the consequences for the victims.” 

    There is no sign whatever that women in Afghanistan are being treated better than before the US invaded in late 2001. In all its years of operations and “Supporting the adherence to the principles of rule of law and good governance” in Afghanistan the US-NATO military alliance has not made the slightest difference to the appalling way in which Afghan males conduct themselves towards females.

    Since 1979 there has been an international ‘Convention on the Elimination of All Forms of Discrimination Against Women,’ which has been ratified by 187 of the UN’s 194 nations (including Afghanistan). It specifies that “States Parties shall take all appropriate measures to eliminate discrimination against women in all matters relating to marriage and family relations” and the countries refusing to agree to its enforcement are Iran, Palau, Somalia, South Sudan, Sudan, Tonga — and the United States of America.

    Afghanistan’s Law on Elimination of Violence Against Women (EVAW) was passed by presidential decree in 2009. It laid down “criminal penalties for various abuses including rape, child marriage, forced marriage, domestic violence, sale of women and girls, and baad, the giving of girls to resolve disputes between families,” and seemed to be a major step forward in attempts to improve the way in which women are treated. 

    Human Rights Watch notes that in March 2017 a revised penal code was adopted by presidential decree. “It incorporated all the provisions of the EVAW law, while strengthening the definition of rape. However, because a number of conservative members of parliament have opposed the EVAW law, some activists campaigned to preserve the law in its stand-alone form decreed in 2009. In response to their efforts, in August President Ghani ordered the Ministry of Justice to remove the EVAW chapter from the new penal code. The controversial reversal has left the status of the law in limbo.”  In other words, women in Afghanistan are back where they started: without rights, without protection, without hope.

    The Afghan government and the US-NATO military alliance disregard or even condone some of the most horrendous human rights’ violations in the world.  The people of Afghanistan are suffering from a combination of the civil war’s devastation and the mediaeval mindset of many of its primitive legislators and officials. Yet foreign money continues to pour in, while the suicide detonations are echoed by B-52 bombs all over the country.

    The human rights calamity in Afghanistan will not be alleviated while the US-NATO “adviser” nations continue their present policy. 

    They shouldn’t have been in Afghanistan in the first place, but it is now time that the foreigners who have contributed to the catastrophe in Afghanistan brought pressure to bear on the Kabul government to pass and enforce legislature that enforces penalties for abuse of human rights, especially those of women and children. That would be one modest step towards bring the place into the 21st Century. 

  • The Journalists Killed In Russia (Before & After Putin)

    Russian journalist Arkady Babchenko was reported to have been killed in the Ukrainian capital Kiev on Tuesday.

    Just a day later, on Wednesday, he held a news conference.

    Apparently, the Ukrainian security services had feigned his death to get hold of those who had really wanted to kill Babchenko. The Journalist had immigrated to Ukraine after multiple threats against him and his family. 

    In Russia itself, 58 journalists were killed since 1993, according to the Committee to Protect Journalists. 38 were targeted for murder and in 33 cases the murderers went unpunished.

    You will find more infographics at Statista

    But  who can forget Fox’s O’Reilly pressing Trump on his statement in Feb 2017, saying,

    “But he’s a killer though. Putin’s a killer.”

    Trump shrugged the comment off, saying:

    “There are a lot of killers. We’ve got a lot of killers. What, do you think our country is so innocent?”

    Well from the chart above we can see that in the years since Putin was elected. 28 journalists have been killed – an average of 1.5 per year; but in the six years before he was elected 30 journalists were killed – an average of 5 per year.

    The chart above only counts journalists killed in Russia itself, not Russian journalists killed in other countries.

  • Fine-Tuning The Surveillance State

    Authored by Jeremiah Johnson (Nom de plume of a retired Green Beret of the United States Army Special Forces) via SHTFplan.com,

    We have been watching the shift of society and all of its components to collectivist thought and action in preparation for the step into a full-blown totalitarian state.

    Already the Constitution and our rights enumerated within it have been relegated to impotency and practically abrogated.

    The key to this has not been the use of force, but the molding of thought and behavior over the decades within the schools, within the fostered predictive programming of pop culture and television, and within the lying, Marxist, mainstream media.

    Currently there are 22 states that have made a crime of what is referred to as “disturbing the school,” and this has led to thousands of arrests of students for such things as interrupting a teacher, or even belching in class.

    Schools have an increased police presence; however, as we have seen with the school shootings this year, they certainly aren’t there to protect the students.

    Police are in schools to enforce conformity and submissive behavior: they’re managing the “troupe” of juveniles, driving the herd.

    Collective, community thought is the mantra. Advertisements on the radio for high-school sports list all of the acceptable skills that sports convey: leadership, teamwork, cooperation, etc. Gone is personal development, let alone “fun,” the latter being archaic and non-utilitarian. In the past 3 to 4 decades, this collective “consciousness” has become the norm. Creative thought is discouraged unless it is directed… directed by authorities or “approved” controllers/managers. Such thought is supplemented by the actions of those authorities, mislabeled as “government” when the appropriate term is rule.

    An article ran out of News 4, posted on NBC Washington on 5/17/18 entitled Potential Spy Devices Which Track Cellphones, Intercept Calls Found All Over D.C., Md., Va. It is worth reading, as it details the Stingray technology (carried in a briefcase) that capture cellular telephones by tricking them into believing the devices are cell phone towers. This means the phones are tracked, and the government is taking information on them surreptitiously.

    Joe Pinkstone wrote another article for Daily Mail entitled Google’s disturbing vision of TOTAL data collection, released on 5/18/18. The article is very informative, and it presents all of the information (in list form) collected both by Google and Facebook for their data files.

    China has recently rolled out a new camera facial recognition system that can sift through a billion people in a matter of seconds. As written in previous articles, Bill Gates and other corporate investors plan to place 500 satellites into orbit and provide total global coverage in real-time with high-resolution cameras. Cameras and devices have been incorporated into appliances within people’s homes, with links to both law enforcement and private sector corporate monitors with ties to the government.

    One of the greatest problems with all of this is the fostered dependency on these electronic gadgets where many (if not most) people believe they cannot do without them: cell phones, computers, and social media outlets. Every week a new report or story surfaces that shows just how far the government and the corporate interests are pushing this electronic dependency, while the schools are shaping the consciousness of the public and making it ever more malleable. Toward what end? Toward the one that recurs throughout history. We have been warned by Orwell, by Solzhenitsyn, and many others.

    Whether we will heed those warnings and take preventative measures remains to be seen. The definition of tyranny can be measured and defined within the words of the Declaration of Independence.

    We are seeing such a state metastasizing by the day, as the surveillance state is fine-tuned for the final act…a performance that has not happened but is entirely predictable by any who examine the course of history and our past.

  • Mystery Booms Heard Across Pennsylvania Continue To Baffle FBI, Local Authorities

    Authorities in Pennsylvania along with the FBI have been scratching their heads over multiple reports of loud booming sounds in the middle of the night by residents of Bucks and Lehigh Counties. 

    Following a joint investigation with the FBI, the best authorities have been able to come up with for the ominous booms which began on April 2 is that they were caused by an individual setting off “explosions.” 

    A statement from local authorities reads: 

    Since April 2, 2018 over twenty (20) explosions have occurred in the early morning hours (between hours of 0100-0430) in the Upper Bucks County area. Our local, state, and federal Law Enforcement agencies all take these events very seriously and are working dilligently to protect the citizens of our community. Keeping everyone safe is our shared number one priority. Fortunately to date no one has been injured; however, we are attempting to prevent someone from accidentally getting injured by these explosions, including the individual responsible.

    Case closed, pack it up Sherlock.

    One resident’s account of what happened seems to back up the explosions theory after a boom was heard in Nockamixon Township by resident Nick Zangly, who told the Bucks County Herald “it was one hell of an explosion,” who lives down the street from a 4-foot wide by 1-foot deep cavity, which he alleges opened up after the blast.

    Zangli said there was “nothing in the hole, which was filled with water because of heavy rain over the weekend.” Law enforcement came out Monday to investigate the sinkhole but did not respond to any media requests.

    Residents have described the noises as something falling out of the sky or an earthquake. 

    “I thought that somebody was making a tunnel or space junk fell out of the sky,” said Susan Crompton, who lives in Haycock Township.

    “From poachers, gunfire, to explosions to a sonic boom,” said Jerry Hertz of the mysterious sound.

    KYW-TV said there had been no shortage of theories among residents, but still, no clear answer of the cause.

    “It’s a rumble, it actually like rumbles the ground like an earthquake would happen but with a loud like boom,” Crompton added.

    “I’ve been in the military, I’ve got experience with explosives, I was a Navy diver and was definitely not a gunshot,” Hertz said.

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    Meanwhile, Mysterious booms are not just limited to Pennsylvania, as there have been local reports from across the country of booms rocking towns from coast to coast. Likewise, officials have zero answers to provide their citizens, it is hard to prepare for an event if it is not yet identifiable.

  • CIA Undermines North Korea Summit By Leaking Report To Media Asset

    Authored by Elizabeth Lea Vos via Disobedient Media,

    Just as it was reported that the summit between the United States and North Korea was back on and that Kim Young Chol, the Vice Chairman of North Korea was on his way to New York to meet with officials in preparation for the June 12 summit, the CIA leaked an intelligence assessment concluding that “North Korea does not intend to give up its nuclear weapons any time soon.” The timing of this leak is striking, as it seems to be an effort to undermine negotiations between the two nations and comes just days after ranking members of the Democratic Party and Republican hardliners attacked President Donald Trump over his efforts to meet with North Korean leader Kim Jong Un.

    The identity of the reporter who helped break the story also raises serious questions about whether or not a faction within the CIA deliberately attempted to undermine diplomatic efforts to ease tensions on the Korean Peninsula. According to NBC News, the report was leaked to none other than NBC national security reporter Ken Dilanian, known as “The CIA’s Mop-Up Man.”

    In 2014, The Intercept reported on Ken Dilanian’s correspondence and relationship with the CIA while Dilanian was a reporter for the Los Angeles Times.

    According to The Intercept, “Email exchanges between CIA public affairs officers and Ken Dilanian, now an Associated Press intelligence reporter who previously covered the CIA for the Times, show that Dilanian enjoyed a close collaborative relationship with the agency, explicitly promising positive news coverage and sometimes sending the press office entire story drafts for review prior to publication. In at least one instance, the CIA’s reaction appears to have led to significant changes in the story that was eventually published in the Times.”

    According to the Huffington Post, while writing for the Los Angeles Times, Dilanian also reported a CIA claim as fact by stating that “there was no collateral murder in a 2012 drone strike on Al Qaeda leader Abu Yahya al-Libi.” Dilanian’s article was directly disputed in an Amnesty International report.

    In the aftermath of the revelations about Dilanian’s ties to the CIA, he was disavowed by the Los Angeles Times. The disclosure of Dilanian’s collaboration with the CIA also led his former employer, David Lauter of the Tribune Washington to believe Dilanian could have violated Tribune news policy. Lauter acknowledged that Tribune policy dictates that reporters “not share copies of stories outside the newsroom.” Lauter further stated that he was “disappointed that the emails indicate that Ken may have violated that rule.”

    Dilanian has not shied away from pushing articles written by former CIA officials who continue to perpetuate the “Trump-Russia” collusion narrative without any regard to facts, such as Steven Hall’s Washington Post article titled: “I was in the CIA. We wouldn’t trust a country whose leader did what Trump did.”

    Wikileaks has also pointed out Dilanian’s agency connection and his pushing of the “Trump-Russia” collusion narrative, tweeting: “CIA’s ‘mop up man’ Ken Dilanian is the NBC ‘reporter’ used to channel claim about president Putin + US election.”

    In the aftermath of recent revelations concerning the CIA’s collaboration with foreign intelligence agencies to spy on Donald Trump’s campaign during the 2016 US Presidential Election the fresh leaks continue to show a pattern of rebellion that has long run rampant in the US intelligence community. While the CIA’s apparent violations of ethical considerations concerning surveillance of candidates running for public office was serious enough, their interference drags the reputation of the agency to a new (and in the case of Korean peace negotiations, more dangerous) low amid their conflict with the sitting President of the United States.

    However, despite these attacks, preparations between the two countries have continued for the upcoming June 12 summit. President Trump announced earlier today via Twitter that: “We have put a great team together for our talks with North Korea. Meetings are currently taking place concerning Summit, and more. Kim Young Chol, the Vice Chairman of North Korea, heading now to New York. Solid response to my letter, thank you!”

  • Tesla Forced To Explain $34,347 Payment To Board Member's Company

    As the drumbeat for accountability for Tesla’s Board of Directors continues to get louder, more and more scrutiny is being placed on the details surrounding the Board’s relationship with the company. The latest detail which is under scrutiny, a $34,347 payment to a company founded by Tesla’s lead independent director Antonio Gracias, must have raised enough of a concern for the company to feel that it needed to explain itself.

    Bloomberg reported this morning that Tesla paid this money to Valor Management, Gracias’ company, for spending more than 100 days at Tesla’s factory and for “numerous improvements that led to increased Model 3 production rates”.

    A private equity firm linked to a Tesla Inc. director spent more than 100 days at the carmaker’s battery factory late last year to help increase Model 3 sedan production, according to a filing vouching for its beleaguered board.

    Valor Management Corp., whose founder and chief executive is Tesla’s lead independent director Antonio Gracias, contributed to “numerous improvements that led to increased Model 3 production rates,” Tesla said in the filing Tuesday. The carmaker said it paid Valor $34,347 to reimburse for travel, equipment and “budget lodging” near the Nevada factory.

    Tesla had previously said in its proxy statement that this money had been paid for “consulting services related to ‘operational optimization'”. Obviously, with the increased scrutiny on Tesla’s board and people combing through the proxy statement for every last detail, this explanation wasn’t satisfactory enough as written in the initial proxy. This prompted Tesla to file a Form DEF14A, an amendment to the proxy, to offer more detail. Despite Tesla stating it was an arm’s length transaction, the same filing also notes that board member Gracias was “personally involved” in having his companies team help.

    The filing elaborates on what was a vague disclosure in Tesla’s proxy statement released April 26, which described the payment to Valor as being for consulting services related to “operational optimization.” Tesla said then that $34,347 was an immaterial cost and that the services were “provided on an arm’s length basis to Tesla.” The board concluded that it didn’t impede Gracias from making independent judgments as a director.

    The Tuesday filing said that Gracias supported and was personally involved in having Valor’s senior operations team help Tesla at the gigafactory near Reno, Nevada.

    Obviously, not enough operational efficiencies were found to make Tesla hit its production target of 5000 vehicles per week.

    While the sum of money is relatively small, this goes to show that the temperature on the Tesla pressure cooker has risen significantly. This detail would have likely been glazed over or outright ignored in proxies of past years – this year, it doesn’t look like anything is going to get past the scrutiny of those challenging Tesla’s existing board.

    A couple weeks ago, we reported about CtW waging a proxy fight to oust most of Tesla’s board.

    CtW Investment Group, which is working with $250 billion in pension funds, many of which are Tesla investors, has pushed for a long overdue ousting of some of Tesla’s most unqualified and possibly conflicted board members. A  Bloomberg article out on Wednesday morning wrote:

    An activist firm representing Tesla Inc. shareholders has excoriated the electric-car maker, claiming that it’s veered off the path to profit and urging a major overhaul of the Elon Musk-led board.

    CtW Investment Group, working with union pension funds that are Tesla investors managing more than $250 billion, opposes the re-election of three board members who are up for votes during Tesla’s June 5 annual meeting. The firm calls for shareholders to cast ballots against Antonio Gracias, a private-equity investor and Tesla’s lead independent director; Kimbal Musk, Elon’s brother; and James Murdoch, CEO of Twenty-First Century Fox Inc.

    Poor accountability and lack of governance at Tesla have been issues raised by us throughout the past year: there was this Harvard Law blog about whether Musk “dominates” his Board, analysts calling for accountability for Musk’s recent statements and promises of no need for capital and cash flow positive that have been looked upon with increasing skepticism. CtW further goes on to point out many “obvious” critiques of the Board that have long since been pointed out by skeptics of the company, including the board potentially being “beholden” to CEO Musk.

    “Tesla has failed to hit critical production milestones and has consequently seen its past progress toward profitability sharply reverse,” Dieter Waizenegger, CtW’s executive director, writes in a letter the firm plans to file Wednesday with the Securities and Exchange Commission. “But instead of recognizing the need for independent and effective board leadership, Tesla has re-nominated three directors who exemplify the company’s failure to evolve.”

    The letter escalates long-held criticisms of a board that CtW and several investors have faulted for being beholden to Musk, Tesla’s chief executive officer. The company has burned through almost $4 billion during the past year while scaling up operations for the Model 3, intended to be its first mass-manufactured car. The sedan has missed several production targets and stoked concerns about whether the company has enough cash.

    Among the critiques remains the odious Solar City acquisition – currently the subject of a lawsuit and Harvard Law Blog that both draw the same conclusion: Elon Musk may have had full control over his Board and his company when Tesla agreed to acquire Solar City.

    One thing seems to be for sure. It doesn’t look as though anything that gets tucked into SEC filings is going to get through unnoticed at this point. Where formerly the only people reading the filings with fervor and scrutiny may have been shorts sellers, now CtW and other shareholders who want the Board out have motivation to do the same. The pressure continues to rise on Tesla.

  • May You Live In Stupid, Corrupt, And Yet Fascinating Times…

    Authored by Mike Krieger via Liberty Blitzkrieg blog,

    In the old days, America’s top spies would complete their tenures at the CIA or one of the other Washington puzzle palaces and segue to more ordinary pursuits. Some wrote their memoirs. One ran for president. Another died a few months after surrendering his post. But today’s national-security establishment retiree has a different game plan. After so many years of brawling in the shadows, he yearns for a second, lucrative career in the public eye. He takes a crash course in speaking in soundbites, refreshes his wardrobe and signs a TV news contract. Then, several times a week, waits for a network limousine to shuttle him to the broadcast news studios where, after a light dusting of foundation and a spritz of hairspray, he takes a supporting role in the anchors’ nighttime shows.

    – Politico: The Spies Who Came in to the TV Studio

    May you live in stupid, corrupt and yet fascinating times.

    – Me, paraphrasing a Chinese curse

    I’ve been away the past couple of weeks taking a break with my family. I paid attention to the news, but from a distance. As usual, there’s plenty to talk about.

    In the last 24 hours alone, we’ve seen political chaos erupt in Italy and hordes of pundits simultaneously lose their minds over the murder of a prominent Russian journalist that never happened. Such is the world we live in. Stupid, corrupt, yet fascinating.

    Of all the things I could’ve written about, you may be surprised by today’s selection. It’s a clip many of you probably saw where Richard Stengel (who was Time Magazine’s managing editor from 2006-2013) admits he approves of government propagandizing its own citizens during a Council on Foreign Relations forum. Here’s the clip.

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    It remains amusing how mainstream journalists continue to blame the public for not believing them, rather than admitting they themselves created this environment of deep distrust by acting as salespeople for the status quo versus challenging the powerful like they’re supposed to.

    The fact someone who spent pretty much his entire career in journalism, including a lengthy period at the top of Time magazine, is a public advocate of government propaganda tells you all you need to know about the debased state of the so-called “trustworthy” media in modern America.

    Moreover, Mr. Stengel doesn’t just theoretically believe state propaganda’s a good idea, he’s so completely devoted to the concept he took a job with the U.S. State Department which he admits was nicknamed the “chief propagandist job.” If our nation’s esteemed media properties are being run by men and women with this sort of a mindset (they are), what does it say about the overall state of the press today?

    Someone who genuinely accepts and performs the role of speaking truth to power would never want to serve as chief propagandist for the government, nor would a government ever want to hire such a person. The fact Mr. Stengel so seamlessly slithers through the revolving door between government and media says so much about how things work today.

    Of course, Stengel’s not the only one. David Frum started out in journalism and later transitioned to government to become primary cheerleader for the Iraq war as George W. Bush’s chief speechwriter. Naturally, being so spectacularly wrong about one of the biggest foreign policy disasters in U.S. history didn’t impede the man’s career one bit. He easily transitioned back to media, currently finding himself senior editor of The Atlantic magazine. Failing your way to the top is a very real thing in this country.

    But that’s ancient history. One might assume the press’ embarrassing performance in covering and forecasting the 2016 election would’ve led to introspection from the masters of the media universe, but one would be wrong. In fact, NBC recently went ahead and hired ex-CIA head John Brennan as a “senior national security and intelligence analyst,” while CNN scooped up former NSA and CIA chief Michael Hayden in addition to ex-Director of National Intelligence James Clapper. Unfortunately, that’s just the tip of the government-media-complex iceberg.

    As was noted in a February article by Jack Shafer published in Politico:

    Former CIA Director John Brennan (2013-17) is the latest superspook to be reborn as a TV newsie. He just cashed in at NBC News as a “senior national security and intelligence analyst” and served his first expert views on last Sunday’s edition of Meet the Press. The Brennan acquisition seeks to elevate NBC to spook parity with CNN, which employs former Director of National Intelligence James Clapper and former CIA Director Michael Hayden in a similar capacity. Other, lesser-known national security veterans thrive under TV’s grow lights. Almost too numerous to list, they include Chuck Rosenberg, former acting DEA administrator, chief of staff for FBI Director James B. Comey, and counselor to former FBI Director Robert S. Mueller III; Frank Figliuzzi, former chief of FBI counterintelligence; Juan Zarate, deputy national security adviser under Bush, at NBC; and Fran Townsend, homeland security adviser under Bush, at CBS News. CNN’s bulging roster also includes former FBI agent Asha Rangappa; former FBI agent James Gagliano; Obama’s former deputy national security adviser Tony Blinken; former House Intelligence Committee Chairman Mike Rogers; senior adviser to the National Security Council during the Obama administration Samantha Vinograd; retired CIA operations officer Steven L. Hall; and Philip Mudd, also retired from the CIA.

    And CNN is still adding to its bench. Last Saturday, former Comey aide Josh Campbell wrote a New York Times op-ed on why he was leaving the FBI on principle. By Monday, the network was announcing his new position as a “law enforcement analyst.”

    They don’t even hide this stuff and refer to it by secret spook names like Operation Mockingbird anymore. They do it right in your face.

    If anything, the media’s gotten worse since its total failure during the 2016 election and shows no sign of even wanting to improve. Much like the status quo in general, the mass media is fully committed to propagating a culture of stupidity and corruption.

    And these are the people who lecture us about fake news.

    *  *  *

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May 30

Today’s News 30th May 2018

  • Mapping The 'Real' Europe – From 'Swedone' To 'Quitaly'

    First Brexit, now Quitaly… who’s next?

     

    Source: Maps On The Web

  • Italy & The Euro Cannot Be Saved By Mass-Immigration

    Via GEFIRA,

    The ongoing euro crisis has never been and will never be solved. The native European populations are shrinking and this will have a consequence for the economy, production and public finance. 

    The demographic decline is the single most important economic phenomenon. We do not doubt that the annual visitors to the Global Economic Forum in Davos are fully aware of it: they know that the European and East Asian populations are decreasing and that 18 of the 20 top economies will never experience sustainable growth again. The economic press and mainstream analysts somehow do not get it and still believe that countries that will see their native population shrinking by 30% in the next thirty years can increase their GDP.

    Italy is the next epicenter of the demographic crisis. The ongoing euro problems and the orchestrated mass migration into Italy are closely related. Italian population began to dwindle last year, a situation that has never happened in modern history. Without immigration, the Italian working-age population will drop by at least 30% before the middle of the century. If the productivity does not change and even if the Italians are able to balance their budget, the consequences are unsolvable.

    The Italian GDP will be smaller and smaller in proportion to the fall in the number of the working-age population. Every working-age person in Italy is burdened with a sixty-thousand-euro debt and that amount will grow on average by nearly a thousand euros a year because more people are leaving the working force than entering. The debt ratio will be 200 percent by mid-century. We did not factor in the outflow of young people that are looking for employment in other European countries.

    This scenario gives a good indication of the problem Italy faces. In the coming years it is expected that the productivity will go up, but the same holds good for the national debt which will increase by 15 percent since 2012. All Western economies have arrived at the point where productivity has to compensate for the decline in their populations. Italy is the world’s ninth economy and is on a trajectory that in the long run will end in an economic implosion comparable to the 1998 financial crisis in Argentina, number 21 on the world GDP list.

    Financial speculators as George Soros, central bankers and part of the political establishment are fully aware of the long-term perspective of the country and the consequences for Europe. If Italy ditches the euro, the situation will be much worse than the 2008 financial crisis. Not only will the value of the euro collapse but investors, business people and the general public will begin to doubt the viability of the euro currency or fiat currency in general.

    Politicians within the European Union try to throw the hot potato to the next generation because they know that they will not be able to contain the mayhem if push comes to shove. To deal with the consequence of the ultimate euro crisis is not within their competence.

    Italy does not have its own Central Bank and the country cannot unilaterally suppress interest rates or buy its own debt. Creating money out of thin air as the Japanese do is impossible for the Italian political and monetary establishment.

    Most politicians are not part of the wealthy elite, so they do not run a risk of winning or losing any assets. They serve their term (and the particular political purpose) and then they are rewarded with a position at one of the irrelevant international organisations. It is the financial and economic elites that will be crushed and lose their assets during such a crisis, so In order to turn the tide they are desperately trying to increase the working-age population in Europe by promoting and organising a relentless stream of immigrants into the old continent. The mass migration into Europe and the US and the financial state of affairs are not unrelated incidents and it is no surprise that such speculators as Soros are facilitating and promoting the re-population of Italy. Soros asserts that Europe should accept half a million refugees annually on top of the regular migration. Over years such an annual number of people will create a community of refugees with the size of the German population.

    There is no reason to believe migration from Central Asia and Africa will compensate for the loss of native Europeans. Most of these immigrants come from areas where people have other work ethic than their European counterparts, they lack education and skills to be employable in the Western economies. Unemployment among sub-Sahara Africans in Western Europe is high while there is a high demand for low qualified uneducated East and Central Europeans. For now, some Africans in Italy will provide southern Italy with cheap slave labour in agriculture and the UN and European assistance budget will even bless the region with the influx of money for the charity industry. For the Italian society at large, the massive influx of immigrants from Africa will be a disaster. It will destroy social cohesion, increase government expenditure and fuel general discontent.

    The Italians voted for a new policy that would stop fraudulent NGOs that are shipping another hundred thousand migrants this year to Italy. The two big winners of the last election wanted to send undocumented migrants back home and introduce a parallel currency.

    The Italian President Sergio Mattarella blocked the creation of a new government to protect the investors outside Italy and give them the opportunity to proceed another year with the shipping of Africans into Italy. It will not change the long-term perspective and while the economic community still believes it is all about economics and competitiveness, we’d rather say “It is the demographics, stupid”.

  • US Sanctions On Iran: The Unraveling Of Pax Americana

    Authored by Christopher Wood via Grizzle.com,

    Amid current news headlines about North Korea and related nuclear issues, it is important not to ignore the potential schism that could occur in the G7 world as a consequence of the practical fallout from Donald Trump’s decision on May 8 to exit the 2015 Iran nuclear deal.

    WHAT WILL HAPPEN TO EUROPEAN INVESTMENTS IN IRAN?

    One practical issue is what is going to happen to European investments in Iran. The most high profile example is French energy company Total’s investment in a giant Iran gasfield. Total said this month it would pull out of Iran and its development of the giant South Pars gasfield unless it is specifically protected from US penalties and related sanctions (see Financial Times article “Total threat to pull out of Iran dents EU hopes of saving accord”, May 17, 2018).

    Obviously, some form of compromise may be negotiated. But if Washington takes a hard line, such as claiming US jurisdiction as regards dollar transfers between two sovereign countries as was the case in 2014 with the US$9 billion fine levied on French bank BNP, then a confrontation is seemingly inevitable and, as a result, a growing questioning of the US hegemony implied by the US dollar paper standard, a concern which has long been shared by both China and Russia.

    QUESTIONING THE US’ ROLE AS THE “ECONOMIC POLICEMAN OF THE PLANET”

    In this respect, the most interesting reaction to the Iran issue since Donald Trump made his announcement on May 8 was that of the French finance minister Bruno Le Maire when he said on May 9 that it was not acceptable for the US to be the “economic policeman of the planet”.

    In this respect, France is the European country to watch since it has a history of being willing to stand up to Washington in the post-1945 world. That cannot really be said of Germany and certainly not of Britain.

    POMPEO WARNS IRAN OF ESCALATING SANCTIONS

    Staying on the subject of Iran, US Secretary of State and former CIA boss Mike Pompeo made an ultra-aggressive speech on Monday threatening Iran with escalating sanctions. In his first major foreign policy address as Secretary of State, Pompeo stated:

    Sanctions are going back in full effect and new ones are coming… This sting of sanctions will be painful if the regime does not change its course… These will indeed end up being the strongest sanctions in history when we are complete.

    The above rhetoric hardly suggests a willingness to compromise with the European position. The significance of all of the above is that Europe and the US remain on a collision course.

    IRAN’S EXPORTS BOOMING SINCE SANCTIONS ENDED

    The importance of Europe for Iran can be seen in the fact that Iran’s exports to Europe have surged almost ninefold since the end of sanctions in January 2016.

    Thus, Iran’s exports to the EU have risen from US$1.3 billion in 2015 to US$11.4 billion in the 12 months to January, according to the IMF Direction of Trade Statistics (see following chart).

    There is also of course the growing trade between Iran and China. Iran’s total trade with China rose by 18%YoY to US$27.5 billion in the 12 months to January (see following chart). All this makes Iran a good example of the increasingly multipolar world where American influence or interests appear to be fading.

    IRAN ANNUALIZED EXPORTS TO EU

    Source: IMF – Direction of Trade Statistics

    IRAN ANNUALIZED TOTAL TRADE WITH CHINA

    Source: IMF – Direction of Trade Statistics

    IRAN’S CURRENCY TAKES A HIT

    Meanwhile, Iran’s currency has been hit hard in recent months as a result of the uncertainty created by Trump’s previous repeated earlier threats to pull out of the nuclear deal and now subsequent follow-through decision.

    The rial has depreciated in the black market by 33% against the US dollar year-to-date (see following chart). This followed a period of comparative stability where the currency traded in a 13% range for two years, helped by the optimism created by the nuclear deal as well as by very high real interest rates. Iranian treasury bill yields peaked at 27% in early 2017 and bottomed at 16% late last year. They are now back at 19% as a result of the market pressure created by the threat of renewed American sanctions.

    IRANIAN RIAL/US$ (INVERTED SCALE)

    Note: Based on black market rate after Iran unified its dual exchange rates on 9 April. Source: Ministry of Economic Affairs and Finance, Bonbast.com

    SUBSTANTIAL FOREIGN INVESTMENT IN IRAN

    With a classic bullish emerging market demographic profile, in terms of a population of 80 million, 60% of whom are under the age of 35, Iran has, naturally, attracted a lot of foreign direct investment in recent years, most particularly following the 2015 nuclear deal.

    The biggest of late was the previously mentioned Total’s US$4.8 billion investment signed in July 2017. But Total says it has only invested under €40 million so far, according to the above mentioned FT article, which is precisely why the French company wants to know if it can get a specific waiver from the sanctions.

    In terms of the aggregate data, Iran’s actual FDI inflows surged by 64%YoY to US$3.37 biilion in 2016, according to United Nations data. While an Iranian government report published last year disclosed that Iran has approved US$11.8 billion in FDI during the 12 months to December 2016, with Spain and Germany accounting for US$3.2 billion and US$2.9 billion of that total respectively.

    IRAN FDI INFLOWS

    Source: UNCTAD World Investment Report 2017

    WILL WE SEE A RETREAT FROM PAX AMERICANA?

    The point, therefore, remains that a confrontation between the US and the Eurozone on this issue is potentially a landmark development in the retreat from Pax Americana.

    But for now it is probably the case that most of Europe, in the spirit of appeasement, will be content to fudge the issue in the hope that Donald Trump may not be re-elected to the US presidency for a second term and life will return to “normal”.

    IRAN’S ECONOMY

    Turning away from geopolitical issues, Iran’s economy and financial markets spring some positive surprises. The country has an open capital account, while there is no tax on capital gains or dividends. The Tehran Stock Exchange celebrated its 50th anniversary last year.

    But if FDI has been coming into the country in recent years, foreign portfolio investment activity has been much more limited, with estimates of only US$100 million invested in aggregate. This is the consequence in terms of equities of both a lack of inclusion in benchmark MSCI indices and, of course, of sanctions.

    NO FOREIGN BANKS IN IRAN

    There is still no foreign bank in Iran and therefore a lack of familiar custodians acceptable to international portfolio investors. Indeed, despite the 2015 nuclear deal, it is still not possible to use foreign credit cards to pay for hotel bills or any other transaction.

    Foreign credit rating agencies are also absent which may not surprise given the three biggest are owned by the Americans. This is a pity for the Iranian Government given that, with minimal foreign currency debt and total government debt to GDP of only 35% of GDP, it would make a lot of sense to do a landmark sovereign bond issue. Total external debt is now only US$10.8 billion or just 2.5% of GDP, according to the Central Bank of Iran (see following chart).

    IRAN EXTERNAL DEBT AS % OF GDP

    Source: Central Bank of Iran, IMF

  • Visualizing The Imperial Logic Of US Foreign Policy

    David Sylvan and Stephen Majeski  reveal the imperial logic behind US diplomatic and military interventions around the globe…

     

    Source: Swiss Propaganda Research

    Simple really!

  • "I Am Numb" – John Whitehead Rages "Whose Country Is This Anyway?"

    Authored by John Whitehead via The Rutherford Institute,

    “The first time it was reported that our friends were being butchered there was a cry of horror. Then a hundred were butchered. But when a thousand were butchered and there was no end to the butchery, a blanket of silence spread. When evil-doing comes like falling rain, nobody calls out ‘stop!’ When crimes begin to pile up they become invisible. When sufferings become unendurable the cries are no longer heard. The cries, too, fall like rain in summer.” ― Bertolt Brecht, Selected Poems

    There are days I wake up, and I’m not sure what country I live in anymore.

    There are days I wake up and want to go right back to sleep in the hopes that this surreal landscape of government-sanctioned injustice, corruption and brutality is just a really bad dream.

    There are days I am so battered by the never-ending wave of bad news that I have little outrage left in me: I am numb.

    And then I get hold of myself, shake myself out of the doldrums, and remind myself that it’s not yet time to give up: America needs our outrage and our alertness and our tenacity and our fierce determination to remain a free people in a land where justice matters.

    This is still our country. 

    Don’t just sit there.

    Do something.

    When you hear that the U.S. government “lost” 1,475 migrant children within its care over a three-month period, in some cases handing them off to human traffickers, don’t just chalk it up to incompetent bureaucrats. The Trump Administration’s plan to separate immigrant children from their parents at the border should outrage anyone with a moral conscience, especially in light of the government’s latest revelation that it is unable to account for the whereabouts of 1500 of those children.

    Mind you, this is not just a Trump problem. A recent report indicates that under President Obama’s watch, migrant children were allegedly beaten, threatened with sexual violence and repeatedly assaulted while under the care of Customs and Border Protection (CBP) officials. According to Newsweek, “Border authorities were accused of kicking a child in the ribs and forcing a 16-year-old girl to ‘spread her legs’ for an aggressive body search. Other children accused officers of punching a child in the head three times, running over a 17-year-old boy and denying medical care to a pregnant teen, who later had a stillbirth.”

    ACT. It doesn’t matter what your politics are or where you stand on immigration issues. There are some lines that should never be crossed—some government actions that should never be tolerated or justified—no matter what the end goal might be, and this is one of them. Demand that Congress stop playing politics and endangering children’s lives.

    When you read that Attorney General Jeff Sessions wants police to use stop and frisk tactics randomly against Americans without even the need for reasonable suspicion, don’t just shake your head disapprovingly.

    ACT: Call the Justice Department (202-353-1555) and read them the Fourth Amendment: “The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.”

    After you watch the video of how the Transportation Security Administration, unfailingly tone deaf to the spirit of the Fourth Amendment, subjected a 96-year-old World War II veteran in a wheelchair to a patdown that left no part of her body untouched, don’t just seethe in silence.

    ACT: Contact your representative in Congress and file a complaint on the TSA’s egregious practices. When old women and little children are being groped by government agents, things have gone too far. In light of revelations that the TSA “has created a new secret watch list to monitor people who may be targeted as potential threats at airport checkpoints simply because they have swatted away security screeners’ hands or otherwise appeared unruly,” you can expect even more headache-inducing behavior in the near future.

    When you find out that Amazon is selling police real time facial recognition software that can scan hundreds of thousands of faces, identify them, track them, and then report them to police, don’t just shrug helplessly.

    ACT: Harness the power of your wallet to urge Amazon to favor freedom principles over profit motives. It’s only a matter of time before these programs are used widely here in the U.S. They are already being used and abused abroad. For instance, Amazon’s Rekognition software was used by broadcasters to identify attendees at the royal wedding of Prince Harry and Meghan Markle. Chinese police have used similar facial recognition tools to scan crowds at rock concerts, malls and gas stations in order to catch alleged lawbreakers. Just recently, Chinese police used the technology to capture a suspect who had been living under a pseudonym after he failed to pay for $17,000 worth of potatoes. Chinese schools are even employing the facial recognition cameras in classrooms to alert teachers to students who aren’t paying attention.

    When you hear Sessions bragging about how much he loves civil asset forfeiture, which allows the government to seize Americans’ personal property—money, cars, homes and other valuables—without having to first prove that any criminal conduct has taken place, don’t just take his word for it.

    ACT: Do your own research. You’ll soon discover that because of the corruption that surrounds this abusive program, countless innocent Americans have been robbed blind by government agents out to get rich at their expense. Billions of dollars have been taken without probable cause. Anthonia Nwaorie, a Texas nurse who had saved up $41,377 to start a medical clinic for women and children in Nigeria, had her life savings seized by Customs Agents who refused to return the money unless she agreed to pay their “expenses.” Six months later, even though Nwaorie was never charged with a crime, she’s still waiting to get her money back.

    When you hear about armed Denver police pulling a gun on a school official and conducting a classroom-to-classroom search for a missing student at an area high school, don’t just thank your lucky stars your childhood was more idyllic. Likewise, when you hear that the lieutenant governor of Texas thinks the solution to school shootings is fewer school doors (entrances and exits), don’t just marvel at the short-sightedness of government officials.

    ACT: Say “enough is enough” to government-sponsored violence. The systemic violence being perpetrated by agents of the government has done more collective harm to the American people and our liberties than any single act of terror or mass shooting. Violence has become the government’s calling card, starting at the top and trickling down, from the more than 80,000 SWAT team raids carried out every year on unsuspecting Americans by heavily armed, black-garbed commandos and the increasingly rapid militarization of local police forces across the country to the surveillance drones that are already crisscrossing American skies.

    When you read about how 28-year-old Andrew Finch of Kansas answered a 5 pm knock on his front door only to be shot in the head and killed ten seconds later by a police sniper because a SWAT team responded to a prank “swatting” phone call with full force, don’t just tsk-tsk over the senseless tragedies arising from militarized and police and overzealous SWAT teams. Not only did police refuse to identify the officer who pulled the trigger, but he was also never charged with Andrew’s death.

    ACT: Demand accountability. If any hope for police reform is to be realized, especially as it relates to how SWAT teams are deployed locally and holding police accountable for their actions, it must begin at the community level, with local police departments and governing bodies, where citizens can still, with sufficient reinforcements, make their voices heard.

    The rise of SWAT teams and militarization of American police—blowback effects of the military empire—have unfortunately become entrenched parts of American life. SWAT teams originated as specialized units dedicated to defusing extremely sensitive, dangerous situations. As the role of paramilitary forces has expanded, however, to include involvement in nondescript police work targeting nonviolent suspects, the mere presence of SWAT units has actually injected a level of danger and violence into police-citizen interactions that was not present as long as these interactions were handled by traditional civilian officers. Nationwide, SWAT teams have been employed to address an astonishingly trivial array of criminal activity or mere community nuisances: angry dogs, domestic disputes, improper paperwork filed by an orchid farmer, and misdemeanor marijuana possession, to give a brief sampling. In some instances, SWAT teams are even employed, in full armament, to perform routine patrols. All too often, botched SWAT team raids have resulted in one tragedy after another for American citizens with little consequences for law enforcement.

    When you find out that police and other law enforcement agencies are accessing the DNA shared with genealogical websites and using it to identify possible suspects, don’t offer up your DNA without some assurance of privacy protections.

    ACT: Protect your privacy. It’s not just yourself you have to worry about, either. It’s also anyone related to you who can be connected by DNA. These genetic fingerprints, as they’re called, do more than just single out a person. They also show who you’re related to and how. As the Associated Press reports, “DNA samples that can help solve robberies and murders could also, in theory, be used to track down our relatives, scan us for susceptibility to disease, or monitor our movements.”

    By accessing your DNA, the government will soon know everything else about you that they don’t already know: your family chart, your ancestry, what you look like, your health history, your inclination to follow orders or chart your own course, etc. Capitalizing on this, police in California, Colorado, Virginia and Texas use DNA found at crime scenes to identify and target family members for possible clues to a suspect’s whereabouts. Who will protect your family from being singled out for “special treatment” simply because they’re related to you? As biomedical researcher Yaniv Erlichwarns, “If it’s not regulated and the police can do whatever they want … they can use your DNA to infer things about your health, your ancestry, whether your kids are your kids.”

    In the face of DNA evidence that places us at the scene of a crime, behavior sensing technology that interprets our body temperature and facial tics as suspicious, and government surveillance devices that cross-check our biometrics, license plates and DNA against a growing database of unsolved crimes and potential criminals, we are no longer “innocent until proven guilty.”

    Finally, when you hear someone talking about how two American citizens in Montana were detained by a Border Patrol agent because he overheard them speaking Spanish at a gas station, don’t just shake your head in disgust.

    ACT: Remind yourself (and those around you) that despite the polarizing, racially-charged rhetoric being tossed about by President Trump, this is still a nation whose strength derives from the diversity of its people and from the immigrants who have been seeking shelter on our shores since the earliest days of our Republic. As President Ronald Reagan recognized in one of his last speeches before leaving office:

    “We lead the world because, unique among nations, we draw our people—our strength—from every country and every corner of the world. And by doing so we continuously renew and enrich our nation… Thanks to each wave of new arrivals to this land of opportunity, we’re a nation forever young, forever bursting with energy and new ideas, and always on the cutting edge, always leading the world to the next frontier. This quality is vital to our future as a nation. If we ever closed the door to new Americans, our leadership in the world would soon be lost… Those who become American citizens love this country even more. And that’s why the Statue of Liberty lifts her lamp to welcome them to the golden door. It is bold men and women, yearning for freedom and opportunity, who leave their homelands and come to a new country to start their lives over. They believe in the American dream. And over and over, they make it come true for themselves, for their children, and for others. They give more than they receive. They labor and succeed. And often they are entrepreneurs. But their greatest contribution is more than economic, because they understand in a special way how glorious it is to be an American. They renew our pride and gratitude in the United States of America, the greatest, freest nation in the world—the last, best hope of man on Earth.”

    As I  make clear in my book Battlefield America: The War on the American People, if the freedoms enshrined in the Bill of Rights, the first ten amendments to the U.S. Constitution, are to mean anything anymore—if they are to stand for anything ever again—then “we the people” have to stand up for them.

    We cannot allow ourselves to be divided and distracted and turned into warring factions.

    We cannot sell out our birthright for empty promises of false security.

    We cannot remain silent in the face of ugliness, pettiness, meanness, brutality, corruption and injustice.

    We cannot allow politicians, corporations, profiteers and war hawks to whittle our freedoms away until they are little more than empty campaign slogans.

    We must stand strong for freedom.

    We must give voice to moral outrage.

    We must do something—anything—everything in our power to make America free again.

    As Reagan recognized, “If we lose this way of freedom, history will record with the great astonishment that those who had the most to lose did the least to prevent its happening.”

  • Artist's Impression Of Maduro's Victory Tour

    How do you say Pyrrhic victory in Venezuelan?

    #Winning?

    Source: MichaelPRamirez.com

  • Are Tesla's Self-Proclaimed 'World's Safest Cars' Actually Among The World’s Deadliest?

    Submitted by @ElonBachman

    If there’s one thing that Elon Musk likes more than pseudoprofundity, it’s superlatives. Small wonder, then, that the company that brought us the Gigafactory, Superchargers, and Ludicrous Mode has had an easy time convincing its fan base that Tesla makes the “safest car on the road”:

    Lurkers on Tesla forums can confirm that these safety superlatives are articles of faith among Tesla’s flock, and apparently this faith is shared by Wall Street: Morgan Stanley’s Adam Jonas recently predicted that Tesla’s Model 3 will be “an order of magnitude” safer than the average car. On May 18, Jonas went even further, claiming that after 7.2 billion miles, Teslas have only been “involved” in five U.S. fatalities.

    Wait, what? Observant Twitter users were quick to dispute both Musk and Jonas. Following Jonas’ initial note, pseudonymous poster @ElonBachman crowd-sourced a list over a dozen US fatalities. Jonas was out shortly after with a new note admitting to 15 deaths globally. But the internet doesn’t sleep: as of today, @ElonBachman’s list has grown to include 40 Tesla fatalities globally, including 14 U.S. deaths of Tesla drivers and occupants and a Wile E. Coyote-esque smattering of deaths-by-cliff and deaths-by-swimming-pool. A link to that list, and the sources behind it, is included below the following table:

    [link to Google docs here]

    What do these numbers mean?

    First: they mean that you should not rely on the sell-side for either accuracy or insight. Second: they mean that Musk’s “safest car” claim is bunk. The Insurance Institute for Highway Safety lists numerous luxury cars in Tesla’s class that have zero recorded fatalities (link here: http://www.iihs.org/iihs/topics/driver-death-rates), which would seem to disqualify the Model S and Model X (we’ll come back to the Model 3 in a minute).

    What of Musk’s “4x safer than average” claim? This is tricky because in road safety statistics, as in Princess Bride, there are different kinds of “death.” Luckily, another Musk tweet gives us clues as to how Tesla calculates its deaths:

    The NHTSA “fatality” measure that Musk references includes motorcyclists, cyclists, and pedestrians, as well as drivers and occupants. If we exclude occupants of other cars from the table above, then there have been 28 Tesla fatalities globally—that Twitter knows of, anyway. Dividing 7.2 billion miles by 28 deaths gives 257 million miles per death, notably worse than Musk’s claim of 320 million. Perhaps you are inclined to cut Musk some slack; after all, this is still safer than the average car. But the average car is 11 years old, is small, is driven by a younger and less affluent demographic, and lacks the safety features that come on a $100,000 vehicle. Midsize luxury sedans and SUVs in Tesla’s class have death rates far lower than Tesla’s.

    Which brings us to the Model 3, Tesla’s “mass market” car offering Kia-level styling starting at $50,000. Although no Model 3 deaths have yet been reported, multiple crashes have (including this one), and of course as of the end of Q1 2018 Tesla had only shipped around 10,000 of them (just somewhat fewer than the 200,000 or so that Musk originally  predicted would be on the road by then).

    If a recent Consumer Reports article is any indication (“The Tesla’s stopping distance of 152 feet from 60 mph was far worse than any contemporary car we’ve tested and about 7 feet longer than the stopping distance of a Ford F-150 full-sized pickup”), Morgan Stanley may have to update its Tesla fatality figures again soon.

  • Guccifer 2.0's American Fingerprints Reveal An Operation Made In The USA

    Authored by Elizabeth Lea Vos via Disobedient Media,

    In his final report in a three-part series, Guccifer 2’s West Coast Fingerprint, the Forensicator discovers evidence that at least one operator behind the Guccifer 2.0 persona worked from the West Coast of the United States.

    The Forensicator’s earlier findings stated that Guccifer 2.0’s NGP-VAN files were accessed locally on the East Coast, and in another analysis they suggested that a file published by Guccifer 2.0 was created in the Central time zone of the United States. Most recently, a former DNC official refuted the DNC’s initial allegations that Trump opposition files had been ex-filtrated from the DNC by Russian state-sponsored operatives.

    So, if Guccifer 2.0’s role was negated by the statements of the DNC’s own former “official” in a 2017 report by the Associated Press, why do we now return our attention to the Guccifer 2.0 persona, as we reflect on the last section of new findings from the Forensicator?

    The answer: Despite almost two years having passed since the appearance of the Guccifer 2.0 persona, legacy media is still trotting out the shambling corpse of Guccifer 2.0 to revive the legitimacy of the Russian hacking narrative. In other words, it is necessary to hammer the final nail into the coffin of the Guccifer 2.0 persona.

    As previously noted, In his final report in a three-part series, the Forensicator discusses concrete evidence that at least one operator behind the Guccifer 2.0 persona worked from the West Coast of the United States. He writes:

    “Finally, we look at one particular Word document that Guccifer 2 uploaded, which had “track changes” enabled. From the tracking metadata we deduce the timezone offset in effect when Guccifer 2 made that change — we reach a surprising conclusion: The document was likely saved by Guccifer 2 on the West Coast, US.”

    The Forensicator spends the first part of his report evaluating indications that Guccifer 2.0 may have operated out of Russia. Ultimately, the Forensicator discards those tentative results. He emphatically notes:

    “The PDT finding draws into question the premise that Guccifer 2 was operating out of Russia, or any other region that would have had GMT+3 timezone offsets in force. Essentially, the Pacific Timezone finding invalidates the GMT+3 timezone findings previously described.”

    The Forensicator’s new West Coast finding is not the first evidence to indicate that operators behind the Guccifer 2.0 persona were based in the US. Nine months ago, Disobedient Media, reported on the Forensicator’s analysis, which showed (among other things) that Guccifer 2.0’s “ngpvan” archive was created on the East Coast. While that report received the vast majority of attention from the public and legacy media, Disobedient Media later reported on another analysis done by the Forensicator, which found that a file published by Guccifer 2.0 (on a different occasion) was probably created in the Central Timezone of the US.

    Adding to all of this, UK based analyst and independent journalist Adam Carter presented his own analysis which also showed that the Guccifer 2.0 Twitter persona interacted on a schedule which was best explained by having been based within the United States.

    The chart above shows a box which spans regular working hours. It indicates that unless Guccifer 2.0 worked the night shift, they were likely working out of the US. Though this last data point is circumstantial, it is corroborated by the previously discussed pieces of independently verifiable hard evidence described by the Forensicator.

    When taking all of these separate pieces into account, one observes a convergence of evidence that multiple US-based operators were behind the Guccifer 2.0 persona and its publications. This is incredibly significant because it is based on multiple pieces of concrete data; it does not rely on “anonymous sources within the government,” nor contractors hired by the DNC. As a result, much of the prior legacy press coverage of Guccifer 2.0 as a Russia-based agent can be readily debunked.

    Such tangible evidence stands in contrast to the claims made in a recently published Daily Beast article, which reads more like a gossip column than serious journalism. In the Daily Beast’s recital, the outlet cites an anonymous source who claims that a Moscow-based GRU agent was behind the Guccifer 2.0 operation, writing:

    “Guccifer 2.0, the “lone hacker” who took credit for providing WikiLeaks with stolen emails from the Democratic National Committee, was in fact an officer of Russia’s military intelligence directorate (GRU), The Daily Beast has learned. It’s an attribution that resulted from a fleeting but critical slip-up in GRU tradecraft.

    … But on one occasion, The Daily Beast has learned, Guccifer failed to activate the VPN client before logging on. As a result, he left a real, Moscow-based Internet Protocol address in the server logs of an American social media company, according to a source familiar with the government’s Guccifer investigation.

    … Working off the IP address, U.S. investigators identified Guccifer 2.0 as a particular GRU officer working out of the agency’s headquarters on Grizodubovoy Street in Moscow.”

    [The Daily Beast, March 22, 2018]

    Clearly, the claim made in the Daily Beast’s report is in direct contradiction with the growing mound of evidence suggesting that Guccifer 2.0 operated out of the United States. A detailed technical breakdown of the evidence confirming a West-Coast “last saved” time and how this counters the claims of the Daily Beast can be found in the Forensicator’s work.

    The Forensicator explained to Disobedient Media that their discovery process was initiated by the following Tweet by Matt Tait (@pwnallthings), a security blogger and journalist. Tait noticed a change revision entry in one of the Word documents published in Guccifer 2.0’s second batch of documents, (uploaded 3 days after Guccifer 2.0 first appeared on the scene).

    The Forensicator corrects Tait, stating that the timestamp is in “wall time,” (local time) not UTC. The Forensicator explains that Tait’s mistake is understandable because the “Z” suffix usually implies “Zulu” (GMT) time, but that isn’t the case for “track changes” timestamps. The Forensicator writes that the document Tait refers to in his Tweet is named Hillary-for-America-fundraising-guidelines-from-agent-letter.docx; it has Word’s “track changes” feature enabled. Guccifer 2.0 made a trivial change to the document, using the pseudonym, “Ernesto Che,” portrayed below:

    The Forensicator correlated that timestamp (“12:56:00 AM”) with the document’s “last saved” timestamp expressed in GMT, as shown below courtesy of the Forensicator’s study:

    Based on the evidence discussed above, the Forensicator concludes that Guccifer 2.0 saved this file on a system that had a timezone offset of -7 hours (the difference between 0:56 AM and 7:56 AM GMT). Thus, the system where this document was last changed used Pacific Timezone settings.

    The logical conclusion drawn from the preceding analysis is that Guccifer 2.0 was operating somewhere on the West Coast of the United States when they made their change to that document. This single finding throws into shambles any other conclusions that might indicate that Guccifer 2.0 was operating out of Russia. This latest finding also adds to the previously cited evidence that the persona was probably operated by multiple individuals located in the United States.

    Taken all together, the factual basis of the Russian hacking story totally collapses. We are left instead with multiple  traces of a US-based operation that created the appearance of evidence that Kremlin-allied hackers had breached the DNC network. Publicly available data suggests that Guccifer 2.0 is a US-based operation. To this, we add:

    • The Forensicator’s recent findings that Guccifer 2.0 deliberately planted “Russian fingerprints” into his first document, as reported by Disobedient Media.

    • A former DNC official’s statement that a document with so-called “Russian fingerprints” was not in fact taken from the DNC, as reported by Disobedient Media.

    • The media’s role in propagating the connection between early Russian hacking allegations and the Guccifer 2.0 persona, as reported by Disobedient Media.

    In the course of the last nine months this outlet has documented the work of the Forensicator, which has indicated that not only were Guccifer 2.0’s “ngp-van” files accessed locally on the East Coast of the US, but also that several files published by the Guccifer 2.0 persona were altered and saved within the United States. The “Russian fingerprints” left on Guccifer 2.0’s first document have been debunked, as has the claim that the file itself was extracted from the DNC network in the first place. On top of all this, a former DNC official withdrew the DNC’s initial allegations that supported the “Russian hack” claim in the first place.

    One hopes that with all of this information in mind, the long-suffering Guccifer 2.0 saga can be laid to rest once and for all, at least for unbiased and critically thinking observers.

  • Pepe Escobar: Iran Is Bracing For All-Out Economic War

    Authored by Pepe Escobar via The Asia Times,

    While the dogs of war bark, the Ancient – and New – Silk Road goes on forever and a civilization with a long and proud history gets on with life…

    The minute you set foot in the streets of Mashhad, the air smelling of saffron, a fine breeze oozing from the mountains, it hits you; you’re in the heart of the Ancient Silk Road and the New Belt and Road Initiative (BRI).

    To the east, the Afghan border is only three hours away on an excellent highway. To the north, the Turkmenistan border is less than four hours away. To the northwest is the Caspian Sea. To the south is the Indian Ocean and the port of Chabahar, the entry point for the Indian version of the Silk Roads. The Tehran-Mashhad railway is being built by the Chinese.

    A group of us – including American friends, whose visas were approved at the highest levels of the Iranian government – have gathered in Mashhad for the New Horizon Conference of independent thinkers. Right after a storm, I’m in a van on the way to the spectacular Imam Reza shrine with Alexander Dugin, which the usual suspects love to describe as “the world’s most dangerous philosopher,” or Putin’s Rasputin.

    Debating and discussion time

    We’re deep in debate not over geopolitics but … bossa nova. Exit Sun Tzu and Machiavelli, enter Tom Jobim and Joao Gilberto.

    Persia traditionally has been a land of serious intellectual discussion. At the conference, after a lunch break, a few of us decide to start our own geopolitical debate, no cameras rolling, no microphones on. Dugin expands on what multipolarity could be; no universality; pluriversal; a realm of pluralistic anthropology; all poles sovereign. We discuss the pitfalls of Eurasian identity, Islamic identity, sub-poles, India, Europe and Africa.

    A few minutes later Iranian scholar Blake Archer Williams – his nom de plume – is delving into “The sacred community of Shi’ite Islam and its covenantal dispensation.”

    Karaj is a bustling three million-strong city one hour away from Tehran by freeway. Early one morning I enter a room in a hawza – an Islamic seminary. In my previous travels I have visited hawzas in Qom, but never a female-only school. This one harbors 2,275 active students from all over Alborz province up to PhD level. They study philosophy, psychology, economics and politics. After graduation, some will go abroad, to teach in Islamic and non-Islamic nations.

    Our Q&A is exhilarating. Many of my interlocutors are already teachers, and most will become scholars. Their questions are sharp; some are extremely well informed. There’s so much eagerness to know detail after detail about life in the West.

    High academic standards

    The next day I visit the Islamic Azad University; more than four million alumni, 1.4 million current students, 29,000 faculty members, 472 campuses and research centers and 617 affiliated high schools. The Karaj campus is the second in importance in Iran.

    This is an extraordinary experience. The hillside campus may not be a UCLA, but puts to shame many prestigious universities across Europe. Not to mention the annual tuition fees; only US$1,000 on average. Sanctions? What sanctions? Most of the equipment may yield from the 1980s, but they have everything they need. As attested by jovial master architect Ali Kazemi, who spent 16 years in Paris after graduating from Nanterre, the academic standards are very high.

    Rector Mohammad Hasan Borhanifar – formerly at the University of Kyrgyzstan in Bishkek – opens all the doors at the campus. I’m shepherded by Mohammad Hashamdar, from the Faculty of Languages. I talk to the deans of all faculties and have a Q&A with students, mostly in international relations.

    Even before the proclamation of the “strongest sanctions in history,” everyone wants details on the US Treasury’s new form of financial war, even more deadly than a hot war. In slightly more than two months, the purchase of US dollars, steel, coal and precious metals will be banned; there will be no more Iranian imports to the US and aviation and the car industry will be under sanctions.

    Airbus may have to cancel multi-billion dollar orders from Iran. An IT professor tells me Iran can buy excellent Sukhoi passenger jets instead. No Peugeots? “We buy Hyundai.”

    My interlocutors update me on investments by Total, Airbus, BASF, Siemens, Eni – its branch Saipem signed a $5 billion deal with the National Iranian Oil Company, NIOC, to develop oil and gas fields and ultimately supply energy to Europe. They confirm that if Total pulls out of the development of the 11th phase of the South Pars gas field, the Chinese CNPC will take over.

    Almost 70% of Iran’s oil exports go to China and Asia, 20% go to Europe. Almost 90% of what the EU buys from Iran is oil, going mostly to Spain, France, Italy, Greece, Germany and the Netherlands. Iran remains THE Big Prize, as Dick Cheney well knew; an astonishing $45 trillion in oil and gas reserves.

    A wide gene pool

    I’m slightly alarmed when, talking to the Friday prayer imam – who is the actual representative of Ayatollah Khamenei in Karaj – he’s clueless about the New Silk Roads. Just as the Ancient Silk Road allowed Buddhism to fertilize Chinese culture, Iran, India and China are bound to cross-fertilize again; imagine a trans-Eurasia lab equipped with a wide gene pool and well-educated young armada searching for creative solutions.

    The LA freeway hell pales in comparison with being stuck in a monster three-hour traffic jam from Tehran to Karaj, only 25 kilometers. I duly incorporate a Persian imprecation to my vocabulary; kharab beshe, which in polite translation means “going to nowhere.” I miss my requisite geopolitical dinner with Professor Marandi of the University of Tehran; we do it later on Whatsapp – like MBS and Jared Kushner.

    What daily life in 17 million-strong, congested to death Tehran reveals is the standard of living essentially of a mid-level emerging nation. Everyone has a car, and smartphones and wi-fi are ubiquitous. In parallel, everywhere we feel intimations of a Persian civilization boasting at least a millennium of fabulous history even before Islam was born. And when we talk to the secularized intellectual elite, it’s clear that for them, in comparison, Arabs are nothing but trouble.

    Everywhere I go I’m back in the ’70s; the whole infrastructure seems decades old, but everything works. Except for timing; Iran might as well be the land of magical realism 2.0, where the unexpected happens when all hope has been forsaken.

    A smart, young generation

    In Mashhad, I’m the guest in a political talk show on Khorasan TV – in a studio immaculately preserved from the ’70s. Yes, this is the heart of the fabled Khorasan – “where the sun arrives from” – that transfixed Alexander The Great. I spend half an hour dissecting the JCPOA; my translator is an over-qualified import-export expert. Khorasan TV’s blockbuster is an American-style cop show essentially covering road accidents in real time; after all, the crime rate is negligible.

    Real inflation is at 16% a year – so far. Foreign exchange inflation is much higher. Real youth unemployment is at a steep 30%, in a country of 80 million where the median age is 29 and 40% of the population is under 24. One of my translators in Karaj, Ali, is 24; he’s unemployed, learned English by watching DVDs and cannot afford to rent his own place.

    Under the new rial devaluation, the median regional salary plunged to about US$250 per month. One cannot rent a 40 square meter apartment near Azad University for less than $200 per month.

    I stop for a late night pizza in Mashhad. The bill reads a whopping 200,000 rials; that’s a little more than $3. The euro in the black market spikes to nearly 80,000 rials.

    Social media

    Telegram has been blocked – but still, everyone uses both Telegram and WhatsApp. Some VPNs work, some don’t. The block was not necessarily linked to the spread of anti-government rumors during the January street protests – which actually started in Mashhad.

    Elaheh, who did her language master in France; Bojan, who has a PhD in economics from San Diego State; or Ayoub Farkhondeh, who works on terrorism studies at the Habilian research institute, are all amused by the “bizarre” coverage by Western media of all things Iran.

    The analysis of well-educated people in both Mashhad and Tehran tends to qualify the protests as essentially IMF riots – which happen when the Washington Consensus forces governments to reduce subsidies. Real revolutions, in Iran, involve clerics, middle-class intellectuals and the bazaaris.

    This time the focus was the grassroots; the working class in small provincial cities. Millions in Iran, after all, depend on government salaries and subsidies. In contrast, Team Rouhani is essentially neoliberal.

    Of course, there’s government criticism – more towards the clerics than neoliberal Team Rouhani. Businessmen told me of untold ministerial-level corruption – but it’s virtually impossible to verify the numbers. The Pasdaran, as the IRGC is referred to, continue to control a great deal of the economy and to manage a welfare system and client system that distributes favors to millions of people, but also imposes rigid social control.

    At the same time, not looking at Iran via a windowless cubicle in Washington but actually on the ground, it’s clear that NSC Adviser John Bolton’s plan to revive the Mujahedin-e Khalq, known as MEK, to attempt a color revolution will fail miserably. MEK is universally despised. The whole of Iranian society won’t blame either Khamenei or Rouhani for the incoming economic war.

    Europe on the spot

    Persian politeness, hospitality and graciousness always strike a visitor as deeply touching. All that combined with an obsession with the image that the West has of Iran. Iran does not seek “isolation”; it’s Washington politics that wants it isolated.

    So no wonder Europe is on the spot. The EU will activate a 1996 lawwhich forbids European companies to comply with US sanctions, protecting them “against the effects of the extra-territorial application of legislation adopted by a third country.” Still, the question is ubiquitous; “The Europeans will side with us or the Americans?”

    In parallel, Iranians don’t want to be like the West. And the best way to understand it is by visiting the Imam Reza shrine over and over again – I went early in the morning, after an afternoon storm, and at night.

    Night activities at Imam Reza shrine in Mashhad. Photo: Asia Times/Pepe Escobar

    The Imam Reza shrine, known as Astan Qods-e Razavi, is a marvel enveloped in golden and turquoise domes, lavish minarets and 12 courtyards spread over one million square meters. It hosts the largest Iranian NGO; a centuries-old administrative structure encompassing eight general directorates, more than 50 industrial, agricultural and service companies, over 15 cultural and research institutions and more than 12,000 students.

    The 12th-century library at the shrine is one of the world’s oldest, along with Alexandria, the Vatican and Topkaki. Ayatollah Khomeini ordered its preservation. The public library holds four million books in more than 90 languages. There’s even a lab to “cure book diseases.” Mashhad runs a library in India plus a documentation center with more than 18 million items, including a 1,300-year-old document linked to Imam Ali.

    Before leaving on a night flight to Doha, I visit the shrine one last time with two fine, steeped in history, Italian observers, ace journalist Giulietto Chiesa and writer Roberto Quaglia. It’s the first day of Ramadan. We’re speechless facing the crossover of aesthetic beauty, spiritual illumination and plain old fun.

    Whole families gather, improvise a picnic, chat, take selfies, kids roam around playing. Instead of being glued to some dodgy version of Big Brother, like most across the West, they prefer to live life in a shrine. It is indeed an organic “third day,” like a government insider told me in Tehran.

    Meanwhile, a Chinese train is snaking along from Mongolia to Tehran carrying sunflower seeds. While the dogs of war bark, the Ancient – and New – Silk Road goes on forever.

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May 29

Today’s News 29th May 2018

  • Turkey May Purchase Russian Stealth Fighters, If Delivery Of US F-35s Is Halted

    A U.S. Senate committee swiftly passed the latest version of a $716 billion defense bill last week, including a hard-hitting measure to block Turkey from acquiring Lockheed Martin F-35 Lightning II fighter jets.

    Democratic Senator Jeanne Shaheen and Republican Senator Thom Tillis are responsible for the new amendment to the National Defense Authorization Act that would eliminate Turkey from the F-35 program over its recent purchase of Russian S-400 anti-missile system.

    In response, Turkey pivoted towards Russia, and is expected to acquire Sukhoi SU-57 fifth-generation fighter jets, if Washington chooses to suspend Ankara from the F-35 program.

    “Turkey’s manufacturing partner in the US Senate that the F-35 to even want to put embargoes can change the defensive equation. Ankara will not give up its right on the plane it expects to deliver in June. But the option for Russian-made SU has begun to be discussed,” according to the Yeni Safak Turkish newspaper.

    If not sure in Plan A, you better prepare for a Plan B. At least, Turkey reportedly considers turning to Russian-made fifth-generation Su-57 fighter jets in case its F-35 deal with the US fails. (Source: Sputnik) 

    Nevertheless, according to the Turkish newspaper, Ankara is not abandoning its claim to the expensive American fifth-generation fighter jet, with the first of 21 F-35 planes expected to arrive in June. Turkey has merely initiated new discussions as an alternative to the expensive F-35 program if Washington terminates the contract. That alternative, well, is the low-cost Russian-made Su-57 jets, which are nearly halved in price compared to the F-35s.

    As of Monday, Ankara has made no official statements on that matter.

    While the news reports have yet to be acknowledged by Turkish officials, a source in the Turkish defense industry told Sputnikthat current media reports are based on experts’ opinion and do not reflect the official position of Ankara.

    Professor Dr. Beril Dedeoğlu told the Yeni Safak Turkish newspaper:

    “If the decision is confirmed by Trump, this may mean that other agreements are also broken. So if you do not sell them to us, we go to other security systems. We have other agreements with Russia, we get it from China. This is not for the benefit of America, it is not meaningful for its interests. Turkey will remind them of this situation.”

    Professor Dr. Beril Dedeoğlu. (Source: Yeni Safak)

    Military Aviation researcher Hakan Kilic said:

    “Military Aviation researcher Hakan Kilic: “Trump if he signed the decision of the US Senate, will turn Turkey into Europe. Turkey does not receive the F 35 type aircraft, as an alternative to Europe with the UK Eurofighter 2000 have. There is no special feature on radar, but it is a much better plane than the F-16, even an F-35. Because their maneuverability is very strong. ”

    Military Aviation researcher Hakan Kilic. (Source: Yeni Safak)

    Military strategist Abdullah Agar said:

     “F-35 type aircraft deal is a deal with mutual obligations. One side has no way to cancel the agreement by itself. But the US has previously shown a similar picture in Iran’s nuclear deal. Now he can do something similar. If it does, it will have many consequences in a strategic sense. Trump (F-35 on the embargo) If the Senate approves the decision of Turkey-US relations will be further stretched. Turkey needed to achieve naturally warfare tools and instruments will enter those other engagements. “

    Security Expert Abdullah Agar. (Source: Yeni Safak)

    As it turns out, Washington’s politicians could unknowingly be Moscow’s greatest defense salesperson, as Turkey, a member of NATO, is now pivoting towards Russian military hardware, including S-400 missile systems, and now, the possible sale of Russian fifth-generation fighter jets… Well, that was not supposed to happen.

  • How GDPR Kills The Innovation Economy

    Via John Battle’s Searchblog,

    It’s somehow fitting that today, May 25th, marks my return to writing here on Searchblog, after a long absence driven in large part by the launch of NewCo Shift as a publication on Medium more than two years ago. Since then Medium has deprecated its support for publications (and abandoned its original advertising model), and I’ve soured even more than usual on “platforms,” whether they be well intentioned (as I believe Medium is) or indifferent and fundamentally bad for publishing (as I believe Facebook to be).

    So when I finally sat down to write something today, an ingrained but rusty habit re-emerged. For the past two years I’ve opened a clean, white page in Medium to write an essay, but today I find myself once again coding sentences into the backend of my WordPress site.

    Searchblog has been active for 15 years – nearly forever in Internet time. It looks weary and crusty and overgrown, but it still stands upright, and soon it’ll be getting a total rebuild, thanks to the folks at WordPress. I’ll also be moving NewCo Shift to a WordPress site – we’ll keep our presence on Medium mainly as a distribution point, which is pretty much all “platforms” are good for as it relates to publishers, in my opinion.

    So why is today a fitting day to return to the open web as my main writing outlet?

    Well, May 25th is the day the European Union’s General Data Protection Regulation (GDPR) goes into effect.

    It’s more likely than not that any reader of mine already knows all about GDPR, but for those who don’t, it’s the most significant new framework for data regulation in recent history. Not only does every company that does business with an EU citizen have to comply with GDPR, but most major Internet companies (like Google, Facebook, etc) have already announced they intend to export the “spirit” of GDPR to all of their customers, regardless of their physical location. Given that most governments still don’t know how to think about data as a social or legal asset, GDPR is likely the most important new social contract between consumers, business, and government in the Internet’s history. And to avoid burying the lead, I think it stinks for nearly all Internet companies, save the biggest ones.

    That’s a pretty sweeping statement, and I’m not prepared to entirely defend it today, but I do want to explain why I’ve come to this conclusion. Before I do, however, it’s worth laying out the fundamental principles driving GDPR.

    First and foremost, the legislation is a response to what many call “surveillance capitalism,” a business model driven in large part (but not entirely) by the rise of digital marketing. The grievance is familiar: Corporations and governments are collecting too much data about consumers and citizens, often without our express consent.  Our privacy and our “right to be left alone” are in peril. While we’ve collectively wrung our hands about this for years (I started thinking about “the Database of Intentions” back in 2001, and I offered a “Data Bill of Rights” back in 2007), it was Europe, with its particular history and sensitivities, which finally took significant and definitive action.

    While surveillance capitalism is best understood as a living system – an ecosystem made up of many different actors – there are essentially three main players when it comes to collecting and leveraging personal data.

    First are the Internet giants – companies like Amazon, Google, Netflix and Facebook. These companies are beloved by most consumers, and are driven almost entirely by their ability to turn the actions of their customers into data that they leverage at scale to feed their business models. These companies are best understood as “At Scale First Parties” – they have a direct relationship with their customers, and because we depend on their services, they can easily acquire consent from us to exploit our data. Ben Thompson calls these players “aggregators” – they’ve aggregated powerful first-party relationships with hundreds of millions or even billions of consumers.

    The second group are the thousands of adtech players, most notably visualized in the various Lumascapes. These are companies that have grown up in the tangled, mostly open mess of the World Wide Web, mainly in the service of the digital advertising business. They collect data on consumers’ behaviors across the Internet and sell that data to marketers in an astonishingly varied and complex ways. Most of these companies have no “first party” relationship to consumers, instead they are “third parties” – they collect their data by securing relationships with sub-scale first parties like publishers and app makers. This entire ecosystem lives in an uneasy and increasingly weak position relative to the At Scale First Parties like Google and Facebook, who have inarguably consolidated power over the digital advertising marketplace.

    Now, some say that companies such as Netflix, Amazon and Apple are not driven by an advertising model, and therefore are free of the negative externalities incumbent to players like Facebook and Google. To this argument I gently remind the reader: All at scale “first party” companies leverage personal data to drive their business, regardless of whether they have “advertising” as their core revenue stream. And there are plenty of externalities, whether positive or negative, that arise when companies use data, processing power, and algorithms to determine what you might and might not experience through their services.

    The third major player in all of this, of course, are governments. Governments collect a shit ton of data about their citizens, but despite our fantasies about the US intelligence apparatus, they’re not nearly as good at exploiting that data as are the first and third party corporate players. In fact, most governments rely heavily on corporate players to make sense of the data they control. That interplay is a story into itself, and I’m sure I’ll get into it at a later date. Suffice to say that governments, particularly democratic governments, operate in a highly regulated environment when it comes to how they can use their citizens’ data.

    But until recently, first and third party corporate entities have had pretty much free reign to do whatever they want with our data. Driven in large part by the United States’ philosophy of “hands off the Internet” – a philosophy I wholeheartedly agreed with prior to the consolidation of the Internet by massive oligarchs – corporations have been regulated mainly by Terms of Services and End User License Agreements, rarely read legal contracts which give corporations sweeping control over how customer data is used.

    This all changed with GDPR, which went into effect today.

    There are seven principles as laid out by the regulatory body responsible for enforcement, covering fairness, usage, storage, accuracy, accountability, and so on. All of these are important, but I’m not going to get into the details in this post (it’s already getting long, after all).

    What really matters is this: The intent of GDPR is to protect the privacy and rights of consumers against Surveillance Capitalism.

    But the reality of GDPR, as with nearly all sweeping regulation, is that it favors the At Scale First Parties, who can easily gain ‘consent’ from the billions of consumers who use their services, and it significantly threatens the sub-scale first and third party ecosystem, who have tenuous or fleeting relationships with the consumers they indirectly serve.

    Put another way: You’re quite likely to click “I Consent” or “Yes” when a GDPR form is put in between you and your next hit of Facebook dopamine. You’re utterly unlikely to do the same when a small publisher asks for your consent via what feels like a spammy email.

    An excellent example of this power imbalance in action: Facebook kicking third-party data providers off its platform in the wake of the Cambridge Analytica scandal, conveniently using GDPR as an excuse to consolidate its power as an At Scale First Party (I wrote about this at length here). 

    In short: because they have the scale, resources, and first party relationships in place, At Scale First Party companies can leverage GDPR to increase their power and further protect their businesses from smaller competitors. The innovation ecosystem loses, and the tech oligarchy is strengthened.

    I’ve long held that closed, walled-garden aggregators are terrible for innovation. They starve the open web of the currencies most crucial to growth: data, attention, and revenue. In fact, nearly all “innovators” on the open web are in thrall to Amazon, Facebook, Apple, and/or Google in some way or another – they depend on them for advertising services, for ecommerce, for data processing, for distribution, and/or for actual revenue.

    In another series of posts I intend to dig into what we might do about it. But now that the early returns are in, it’s clear that GDPR, while well intentioned, has already delivered a massive and unexpected externality: Instead of limiting the reach of the most powerful players operating in the world of data, it has in fact achieved the opposite effect.

  • China Accelerates Next-Gen Nuclear Weapons Development To Compete With US, Russia

    As we have been documenting over the last year and beyond, China is rapidly modernizing its military; unveiling a new stealth bomber, an array of guided-weapons, and deploying further from home. Their most recent focus has been on next generation nuclear weapons – as Beijing ramps up blast experiments for nukes comprised of smaller, smarter warheads designed to limit damage by targeting specific targets, according to the South China Morning Post. 

    Between September 2014 and last December, China carried out around 200 laboratory experiments to simulate the extreme physics of a nuclear blast, the China Academy of Engineering Physics reported in a document released by the government earlier this year and reviewed by the South China Morning Post this month.

    In comparison, the US carried out only 50 such tests between 2012 and 2017 – or about 10 a year – according to the Lawrence Livermore National Laboratory. –SCMP

    China’s development of next gen nukes will put them in direct competition with the United States and Russia, sparking concerns by experts over the prospect of a new cold war arms race that has the potential of boiling over into thermonuclear war. 

    Of primary concern is the notion that nations possessing smaller, targeted nukes might be more inclined to use them vs. larger and more devastating munitions – which could easily lead down the slippery slope of larger nuclear exchanges. 

    These new weapons are considered more “usable” for tactical tasks such as destroying an underground bunker while generating little radioactive fallout.

    Pentagon officials have said the US wants its enemies to believe it might actually use its new-generation weapons, such as smaller, smarter tactical warheads designed to limit damage by destroying only specific targets.

    But with these relatively safer and less destructive weapons in hand, governments may end up losing the inhibition to use them. -SCMP

    “The use of small warheads will lead to the use of bigger ones,” Beijing-based naval expert Li Jie told the Post. “If other countries use nuclear weapons on us, we have to retaliate. This is probably why there is research to develop new weapons.”

    While an international ban prohibits China from testing actual nuclear weapons (a ban North Korea has laughed at for years), major nuclear powers continue to conduct testing via high-powered gas guns that fire high speed projectiles at weapons-grade laboratory materials.

    The tests are conducted using a large, sophisticated facility known as a multi-stage gas gun, which simulates the extreme heat, pressure and shock waves produced in a real nuclear blast.

    The experiments with the gas gun provide scientists with the data they need to develop more advanced nuclear weapons.

    In the past, researchers used supercomputers to draw on historic data derived from live nuclear tests performed before the international ban was imposed in the 1990s.

    But new technology that emerged in recent years, such as hypersonic vehicles and artificial intelligence, opened the door for the development of new nuclear weapons that could be smaller in size and more precise.

    The gas gun works by using special explosives to force a piston along a hydrogen-filled metal tube. Once the hydrogen gas reaches a certain temperature and pressure, an “impactor” is released which travels at incredibly high speeds of at least 18,640 MPH towards a target. 

    Smaller than a saucer, the impactor is comprised of the same materials used in a nuclear warhead such as plutonium, metal, plastic or foam of different densities – resulting in a chemical reaction similar to that of a nuclear detonation. 

    [insert: gas gun.JPG, f29bb5ca-5f25-11e8-a4de-9f5e0e4dd719_972x_130850.jpg , f2cf81f2-5f25-11e8-a4de-9f5e0e4dd719_972x_130850.jpg ]

    US gas gun at Jasper facility in Nevada

    The impactors are quite difficult to produce, as even the slightest structural defect at the microscopic level of just a few nanometers can ruin the experiment, according to Luo Guoqiang of China’s Minyang research center. 

    “The making of the impactor involves the cream of precision manufacturing. Thanks to numerous breakthroughs in recent years we are now beating our counterparts in the US with a series of impactors with superior performance,” he said.

    Well made impactors, allow experiments to proceed faster at lower cost, while obtaining higher quality data. 

    Over the past three years, Chinese scientists have carried out more such gas gun tests than the United States has in 15 years. 

    In tunnels deep under mountains in Mianyang, southwestern Sichuan province, where China’s main nuclear design facilities are based, loud blasts from these experiments can be heard more than once a week.

    In comparison, between 2003 and 2017, the US fired a total of 150 simulated shots at its Joint Actinide Shock Physics Experimental Research (Jasper) facility at the Nevada National Security Site. -SCMP

    That said, China can’t hold a candle to the United States when it comes to advanced nuclear technology, according to Professor Wang Chuanbin, from the State Key Laboratory of Advanced Technology for Materials Synthesis and Processing at the Wuhan University of Technology.

    Wang says that the number of live tests conducted by China pales in comparison with the U.S., which has set off over 1,000 nuclear warheads since 1945 beginning with the Manhattan Project. China, meanwhile, has only carried out 45 live tests. 

    “It is possible we are in a hurry to catch up,” Wang said.

    James Lewis, senior vice-president at the Centre for Strategic and International Studies, a Washington-based think tank, said a new round of the nuclear arms race had already begun, though public opinion had yet to catch up with the grim reality.

    The White House is considering a US$1.2 trillion plan to upgrade its nuclear stockpile. Earlier this year, the Pentagon announced it would develop new low-yield nuclear weapons that could be mounted on conventional cruise missiles and launched by submarines.

    The White House’s developments are in response to Russia’s recent actions, according to Lewis, who notes that Russian President Vladimir Putin has revealed a series of new nuclear weapon designs – including smaller, tactical nukes – as well as a “super torpedo” capable of wiping out coastal cities. 

    “It’s not clear to me how successful the Russian programme will be, but it has stirred everyone up on the subject,” Lewis said. “After some debate, the US decided it needed to think about warheads, without the need for actual tests. It wouldn’t surprise me if China saw all this and decided that it had better get in the game.”

    Following a February announcement by US officials of a new nuclear weapons policy, an editorial was published in Chinese state-run tabloid Global Times which said that China would seriously consider going public with its tactical, low-yield nuclear weapons program in response. 

    “China is a nation capable of massively increasing the size and improving the technology of its nuclear stockpiles,” stated the newspaper, adding “China needs a new policy to deal with a new situation.”

    And as we mentioned last week, Bank of America’s Mike Hartnett writes that the “trade war” of 2018 should be recognized for what it really is: the first stage of a new arms race between the US & China to reach national superiority in technology over the longer-term via Quantum Computing, Artificial  Intelligence, Hypersonic Warplanes, Electronic Vehicles, Robotics, and Cyber-Security.

    At the end of the day, the China First strategy will be met head-on by an America First strategy.  Hence the “arms race” in tech spending which in both countries is intimately linked with defense spending. Note military spending by the US and China is forecast by the IMF to rise substantially in coming decades, but the stunner is that by 2050, China is set to overtake the US, spending $4tn on its military while the US is $1 trillion less, or $3tn.

    This means that some time around 2038, roughly two decades from now, China will surpass the US in military spending, and become the world’s dominant superpower not only in population and economic growth – China is set to overtake the US economy by no later than 2032  – but in military strength and global influence as well.

    And, as Thucydides Trap clearly lays out, that kind of unprecedented superpower transition – one in which the world’s reserve currency moves from state A to state B – always takes place in the context of a war.

    Which explains BofA’s long-term strategic recommendation: “We believe investors should thus own global defense, tech & cybersecurity stocks, particularly companies seen as “national security champions” over the next 10-years.“

  • Sanctioning The World, The US Inadvertently "Locks & Launches" Multipolarism

    Authored by Alistair Crooke via The Strategic Culture Foundation,

    The commemorative medal had already been cast and published. It depicts profiles of Trump and Jong Un, facing each other, at the 12th June historic meeting – at which Jong Un was supposed to disavow and discard his nuclear armament, irreversibly, and then to accept Trump’s gracious benediction. The meeting now is moot (and, since drafting, has been cancelled, blindsiding both Moon and Abe, and now back on), leaving in its wake, a frustrated and angry Trump. And, as we prefigured earlier, instead of realising that Team Trump had not been listening adequately to what Jong Un was signalling, Trump now blames Xi for upsetting ‘the deal’ from being struck.

    China’s Global Times makes the point:

    “The US unilaterally demands prompt peninsular denuclearization before it provides compensation to Pyongyang. China will not oppose such a deal between the US and North Korea. However, can Washington achieve it? Pyongyang has just given an answer … It would be OK if Washington pressures Pyongyang to gain an edge in negotiations, but Washington should think twice about the possibility of pushing the Korean Peninsula back to fierce antagonism.

    It is clear from China’s perspective that the US has overestimated its weight in forcing North Korea to accept its demands. The US has forgotten the awkward situation it was in last year when it could not stop North Korea’s nuclear and missile tests, and the difficulty of taking military action against North Korea.

    The US has always believed it was duped by North Korea, which is, in fact, far from correct. The US was responsible for the aborted peninsula resolutions, multiple times.”

    Irritated too, by harsh comments made by ‘trade hawks’ on the lack of tangible result in trade negotiations with China (Steve Bannon, for example, told Bloomberg that Trump “changed the dynamic regarding China – but in one weekend, Secretary Mnuchin has given it away”), Trump now seems to be set to pivot towards a tougher China trade stance, saying that the talks had not achieved much, and that a new framework might be needed.

    The Singapore summit cancellation (blamed in part, on Xi), and the disappointment with trade talks, arrives on the heels of the Pentagon revoking China’s invitation to participate in RIMPAC, ‘the world’s largest naval exercise’, because of Beijing’s “aggressive actions in the South China Sea, which have recently included reports that it quietly installed ‘defensive’ missiles in the Spratly Islands – capable of striking US territory. Undeterred however by Pentagon threats, China responded by warning that its new J-20, fifth generation, stealth fighter, will henceforth be flying patrols in Taiwan’s airspace – a clear signal that Xi wants ‘his island’ back, and plans to get it.

    In short, US friction with China is on an upwards trajectory, and may spike further, were Washington now to threaten the Korean peninsula with military action of some nature.

    Friction is not confined to the US relationship with China however. Trump’s conversion to full-court ‘neo-Americanism’ (see here), it seems, has put Washington at odds with the World at large: Trade wars (China, Russia, EU & Japan), sanctions (Russia, Iran, et al), currency wars (Turkey, Iran Russia), etcetera, etcetera. This level and breadth of friction is not sustainable. The psychic tension must lead either to something somehow snapping (explosively) to break the tension, or to a marked U-turn in language and behaviour that relieves pressures more gently. At the moment we are still in the updraft. Trump has provoked literally everyone (even the usually compliant Europeans), as never before. And, consequently (and inadvertently), has accelerated markedly, the arrival of the incoming new global order – and, by heightening geo-political tension nearly everywhere, has accelerated further steps towards global de-dollarisation. 

    Again, even the Europeans are rueing that they chose not to configure the Eurozone, as distinct and separate to the dollar hegemony – when they had the chance. Now they pay the price of their impotence in their – now ‘outlawed’ – trade with Iran. Rather too late in the day, the EU proposes to abandon the petrodollar for Euros in respect to their purchases of Iranian oil; but in all probability, it will be to no avail. EU leaders stand shocked and angered by the ruthlessness by which the US intends to strangle all EU commerce with Iran.

    What is interesting here, is how China views the nature of the friction with the US, and its root cause: It – via a Global Times op-ed – starts with a clear warning: “When the second round of trade talks finished last week, a number of [US] media reports were hailing the end of the trade war threat. Some even said that China had won the first round of the negotiations with the US: This conclusion is totally wrong, and the idea that the trade friction has been resolved, is groundless. There hasn’t been a trade war yet, just a series of warnings…” (Emphasis added). 

    The author then goes on to say that US trade deficits are not at the root of the friction between the two states: “The real culprit is the monopoly of the US dollar in the global market”, and the enforced use of the dollar to settle payments. The US must “avoid over-supply of the dollar, and allow greater use of other currencies such as the yuan and the euro to promote more balanced currency supply … [and] the US must amend its currency policy”.

    President Putin is saying the same: Addressing the Russian parliament, he said that “the whole world sees the dollar monopoly is unreliable: It is dangerous for many, not only for us”. He added that sanctions, and trade actions via the WTO, are increasingly being improperly used by the US primordially, to secure competitive advantage, or to hold back competitors’ economic development (a principal Chinese complaint). 

    In other words, they want the ‘US-led global order’ swamp drained, just as much as Trump desires to see the Washington swamp drained.

    Trump seems happy however, to use ’swamp’ tactics toward the external world in order to make America Great again (even as he decries the Establishment ’swamp’ at home), but the non-West is as thoroughly disenchanted by the ‘global order swamp’ tactics as is Trump’s base: They want the dollar hegemony gone, their own sovereignties restored – and are re-grouping politically to achieve it. Its parts, though distinct, seem to be coming together.

    The mafia-like, Trump ‘shakedown’ of Chancellor Merkel (‘give up Nord Stream II, or we’ll shake you Germans down, in terms of Steel and Aluminum), firstly, is catalyzing the possibility of a major re-orientation of European policy.

    The European resolve on Russia sanctions long has been shaky: German and Italian businesses have been hard hit financially, and it has been essentially Merkel who held the European ‘line’. These European sanctions are solely Ukraine-related, and the Chancellor has been talking with Putin in Sochi about Ukraine. There, in Sochi, Putin offered two ideas: a UN peace-keeping force for Ukraine, and continued transit of Russian gas through the Ukraine corridor (a major European point) – if that were to prove commercially viable.

    If these thoughts prove to be fecund, it would allow Merkel to front-run ‘the inevitability of an Italian ‘no’ to renewal of Russia sanctions in September’. She could be ‘leading again’: taking forward an initiative of her own – balm to the European ego after the disappointing experience of JCPOA. Soothing the Ukraine irritant, in this way, would also allow a Germany – now, in this new US tariff era, even less open to taking a ‘hit’ on European delinquent debt, or to re–financing French infrastructure – to view Russia as a natural partner. It might also allow her to defuse somewhat the immigration ‘bomb’ by agreeing with Putin a mechanism by which the some of the one million Syrian refugees in Germany, return home. Next week, Merkel goes to China, to see how to finesse US pressure on Europe to side with America – against China. We may find, contrarily, that Germany ends up closer to China, which has been investing heavily in Germany, rather than closer to the US (though Germany cannot easily avoid being pig-in-the middle in this trade fight).

    Of course, the Anglo ‘Establishment’ will do almost anything to stop the political centre of gravity shifting from the shores of the Atlantic, eastwards. The head of the British Security Service (MI5) has already been sent on a mission by Washington to hype the Russian ‘threat’ to a gathering of thirty European states; and the US envoy in Kiev, Kurt Volker, declared American military support for retaking the breakaway self-proclaimed republics of Donetsk and Lugansk.

    At the same time, for Japan, the Korean peninsula has been long viewed as a buffer between it and the mainland. Its division however, and the American presence in the south, had seemed the guarantor of the buffer. But then the South gave Moon a mandate for re-unification – and Jong Un in response, dramatically began his charm offensive. The status quo of the ‘buffer’ that had been a given, evidently was no longer ‘a given’. There might be an agreement and, even potentially, over time, increased Chinese influence there. Professor Victor Teo noted that “Trump’s agreement to meet the North Korean leader Kim Jong-un, had sidestepped Abe and “cut him off at his knees”.

    Even as a possibility, this was a serious problem for Japan, who would lose its buffer with China – and depending on the extent of any putative US withdrawal from the region – lose its defence umbrella too. Equally unnerving, Politico notes, was “Trump’s apparent U-turn on the Trans-Pacific Partnership. In January 2017, three days into his presidency, Trump reneged on Barack Obama’s China-containing, 12-nation trade deal.” “It humiliated Abe, who 67 days earlier hustled to Trump Tower to head off Washington’s TPP exit. Twelve months later, Trump added salt to those wounds by adopting a weak dollar policy and slapping duties on steel and aluminum — 25 percent and 10 percent, respectively. He doled out exemptions to Canada, Mexico and others, but none for best friend Abe. Then came Trump’s proposed $150 billion worth of taxes on goods from China, Japan’s main export market.”

    So, not surprisingly then, Abe has reached out to China, both to hedge against the US on tariff worries, and to insert Japan into the strategic discussions on Korea’s future (the Chinese premier Li Keqiang made an official visit to Tokyo on 9 May to participate in trilateral talks with the Japanese and South Korean leaders).

    The point here is that this trilateral re-set of relations followed high-level economic talks between China and Japan last month, and recalling China’s clear warning about the dollar problem, and the need to widen the use of the Yuan and other currencies in trade, it is not hard to guess that Chinese-Japanese trade will gradually be de-dollarised, if these talks succeed.

    In the same vein, Lawrence Sellin of The Daily Caller reports that:

    “Chinese efforts towards Iran-Pakistan cooperation have also borne fruit. In recent months, there has been a flurry of agreements in trade, defense, weapons development, counter-terrorism, banking, train service, parliamentary cooperation and — most recently — art and literature.

    Secret security-related discussions among the Chinese, Pakistanis and Iranians military officials have been ongoing for at least a year. A major stimulus for those discussions has been the planned construction of a Chinese naval base on Pakistan’s Jiwani peninsula, immediately west of Gwadar near the Iranian border…

    A China-Iran-Pakistan alliance would have sweeping ramifications for U.S. foreign policy. For starters, it would render our current efforts in Afghanistan untenable, most likely provoking an American exit under conditions dictated by the Chinese and Pakistanis. It would initiate the beginning of an anti-access, area denial strategy against the U.S. Fifth Fleet in the Persian Gulf and Arabian Sea region, similar to what the Chinese have attempted to implement against the U.S. Pacific Fleet in the South China Sea. Even the mere contemplation of such an alliance could give the Iranians considerable leverage in the face of American sanctions.”

    Iran has already joined the East Asian Economic free trade area – and on 9th June, will also be attending the Shanghai Co-operation Council 2018 summit, in China. (It seems that Iran is not exactly being ostracised post-JCPOA.)

    What links these many parts to the jigsaw however, is the Chinese (and Russian and Iranian view) that the Yuan and the Euro need to be more readily available as currencies in which trade is conducted – and “that the US must amend its currency policy” (that is to end its oscillation between strong and weak dollar cycles, which has been so profitable for US financial institutions, but lethal to Emerging Markets). Virtually everyone agrees on this now.

    For this to happen, China needs to widen and deepen the Yuan base, and to provide a liquid market in Chinese sovereign debt. The Shanghai oil futures market is already making its impact on deepening China’s sovereign bond market (as traders park their Yuan proceeds in it, knowing that ultimately the Yuan may be redeemed for gold). US sanctions on Iran will give this further impetus, as Iranian oil becomes sold in Shanghai. The Chinese-owned London Metal Exchange has lately announced that it will begin trading Yuan currency commodity options, too. Soon we will have Yuan-based commodity benchmarks. All in all, the use of the dollar in non-US trade, is being, step by step, progressively shrunk.

    But the second Chinese requirement for resetting the trading world by the US ‘amending its currency policy’, serendipitously seems to be occurring as a result of autonomous domestic financial dynamics: Trump’s ‘weak dollar’ has been giving way to elevated dollar values (for a variety of reasons). It provides the perfect conditions for China gently to devalue the Yuan (which has been appreciating against the dollar over recent months), and for Europe to do the same, in a co-ordinated downward float against a spiking dollar. The lower exchange value of Yuan and Euro simply will partly, or wholly, reverse the impact of US sanctions on exports to the US. Might this currency co-ordination too be on the agenda for Merkel next week in China?

    If these US policies are not sustainable, what then? The primal flaw to the neo-con maximum leverage doctrine is its lack of any easy ladder down which to climb that does not appear to be a national US humiliation. Usually, if pressure doesn’t work, it is assumed that it was because there was not enough of it – for example, Trump attributes the weaknesses to the JCPOA to Obama failing to let the Iranians stew in sanctions for long enough. Obama cut the pressures too early in Trump’s view – and hence got a ‘flawed agreement.’

    A deeper point – and one made by the Chinese in respect to North Korea – is that others do not think in the way of President Trump. The radical utilitarianism evident when Trump says that Jong Un will be “safer, happier and richer” if he accepts Trump’s ultimatum reflects precisely the shallow materialism, on which the global political tide has turned. The so-called ‘populist’ call for a return to traditional national values precisely is a rejection of JS Mills type of utilitarian politics. It is, as it were, the wish to return to being human, in a rounder way.

  • Watch: Israeli Autonomous Drone Evacuates Wounded, Delivers Cargo In IDF Demonstration

    Tactical Robotics (a subsidiary of Urban Aeronautics Ltd.), based in Yavne, Israel, recently debuted its autonomous drone named Cormorant, a single-engine Vertical Take Off and Landing (VTOL) aircraft with internal lift rotors enabling it to land and take off almost anywhere. The drone’s radical new design offers life-saving technologies onto the modern battlefield and emergency disaster situations.

    Tactical Robotics (a subsidiary of Urban Aeronautics Ltd) has taken the lead in the development of the Cormorant. (Source: Tactical Robotics)

    Earlier this month, the Israel-based robotics company successfully completed its first “mission representative” demonstration for its primary customer, the Israel Defence Forces (IDF). The demonstration was conducted at Megiddo Airfield in the Galilee, according to the Tactical Robotics press release. The Cormorant drone performed a series of pre-planned flights to a specified point of delivery, offloading specialized cargo, and loading of a manikin that simulated a wounded soldier on the battlefield, which was then returned to the point of origin.

    “The demonstration, a combination of cargo delivery and casualty evacuation, reflects Cormorant’s unique dual-role capability as the only UAS recognized by NATO to fulfill both cargo delivery and CasEvac missions. As such, the aircraft is designed to exceed the standard reliability and handling qualities required of a typical, tactical UAS in order to meet the requirements to safely ferry human “cargo” back from the battlefield,” Tactical Robotics said.

    Cormorant IDF Mission Demo May 2018

    Cormorant’s rotor arrangement minimizes its footprint. Internal lift rotors embedded underneath the aircraft within the airframe — allows it access to obstructed areas with wires, buildings, forests, jungles, and even challenging terrain, where helicopters could never attempt a touchdown.

    The aircraft’s single turbocharged engine powers the two lift rotors and two smaller rotors mounted vertically on either side of the drone’s tail.

    According to Tactical Robotics’s website, the engine gives the Cormorant the ability to lift over 1,000 pounds of cargo — or about two wounded soldiers.

    Cormorant CasEvac Loading at IDF demo. (Source: Tactical Robotics’s YouTube) 

    The mission range of the drone is about 30 miles at over 100 mph. The drone’s design followed the most stringent FAA design requirements for rotorcrafts, which could boost its chances for broad adoption in military, civilian, and even industrial applications.

    The Cormorant for casualty evacuation and cargo demonstration for the IDF

    In 2017, Cormorant completed its first flight over low terrain, and, in 2018, the aircraft was recently tested for military applications by the IDF. The company expects the drone to be in full operational use by 2020, which could complement IDF soldiers in a war with Syria and or Iran.

  • London-to-Langley Spy Ring; The Roots Of Obamagate Become Clearer

    A recent article by George Neumayr in The American Spectator provides an excellent forensic dig into the earliest stages of the US Intelligence Community’s surveillance of people in Trump’s orbit – and makes clear something that many pointing to a politicized “witch hunt” have long suspected; the Obama DOJ/FBI began looking into “Trumpworld” and the Russians long before the official timeline would suggest. 

    Moreover, the operation was conducted in close coordination with foreign counterparts, primarily the United Kingdom and Australia, but primarily the former. 

    All of this raises plenty of questions, but one conclusion about this epic fiasco requires no spying: the fingerprints of the British are all over it. –American Spectator 

    Here is George Neumayer explaining, how the “roots of Obamagate become clearer” originally published in The American Spectator.

    * * *

    Even before the first Republican primary, a London-to-Langley spy ring had begun to form against Donald Trump. British spies sent to CIA director John Brennan in late 2015 alleged intelligence on contacts between Trumpworld and the Russians, according to the Guardian.

    Here’s the crucial paragraph in the story:

    GCHQ first became aware in late 2015 of suspicious “interactions” between figures connected to Trump and known or suspected Russian agents, a source close to UK intelligence said. This intelligence was passed to the US as part of a routine exchange of information, they added.

    Notice it doesn’t say the “Trump campaign” but “figures connected to Trump.” One of those figures was Michael Flynn, who didn’t join the campaign until February 2016. But Brennan and British intelligence had already started spying on him, drawing upon sham intelligence from Stefan Halper, a long-in-the-tooth CIA asset teaching at Cambridge University whom Brennan and Jim Comey would later send to infiltrate the Trump campaign’s ranks.

    It appears that Halper had won Brennan’s confidence with a false report about Flynn in 2014 — a reported sighting of Flynn at Cambridge University talking too cozily with a Russian historian. Halper had passed this absurdly simpleminded tattle to a British spy who in turn gave it to Brennan, as one can deduce from this euphemistic account in the New York Times about Halper as the “informant”:

    The informant also had contacts with Mr. Flynn, the retired Army general who was Mr. Trump’s first national security adviser. The two met in February 2014, when Mr. Flynn was running the Defense Intelligence Agency and attended the Cambridge Intelligence Seminar, an academic forum for former spies and researchers that meets a few times a year.

    According to people familiar with Mr. Flynn’s visit to the intelligence seminar, the source was alarmed by the general’s apparent closeness with a Russian woman who was also in attendance. The concern was strong enough that it prompted another person to pass on a warning to the American authorities that Mr. Flynn could be compromised by Russian intelligence, according to two people familiar with the matter [italics added].

    Again, that’s early 2014 and a file on Flynn is already sitting on Brennan’s desk. In 2015, as word of Flynn’s interest in the Trump campaign spreads, the London-to-Langley spy ring fattens the file with more alarmist dreck — that Flynn had gone to a Russian Television gala and so forth. By February 2016, when it is reported that he has joined the Trump campaign as an adviser, the spy ring moves into more concerted action.

    It had also extended its radar to Carter Page, George Papadopoulos, and Paul Manafort. Peter Strzok, the FBI’s liaison to Brennan, could have already clued Brennan in to Page and Manafort (both were already known to the FBI from previous cases), but Brennan needed British intelligence for Papadopoulos and it delivered. Either through human or electronic intelligence (or both), it reported back to Brennan the young campaign volunteer’s meetings in Italy and London with Professor Joseph Mifsud, whose simultaneous ties to British intelligence and Russia are well known.

    The stench of entrapment that hangs over this part of the story is unmistakable, and the spy ring’s treatment of Papadopoulos looks flat out cruel. Every figure who plays a key role in tripping him up — Mifsud, the Australian diplomat Alexander Downer, and Stefan Halper — has ties to British intelligence.

    David Ignatius, who is the Washington Post’s stenographer for John Brennan, dropped a wonderful crumb in his passive-aggressive column about Stefan Halper this week — “Stefan Halper is just another middleman.” A middleman between whom? The answer is British intelligence and Brennan/Comey. As if to punctuate this point, Ignatius — after belittling Halper as a gossipy academic who is no “James Bond,” a sign that his handlers will burn him and profess ignorance of his entrapping methods (when this happens, remember Comey’s “tightly regulated” tweet) — turns to a “former British intelligence officer” to vouch for Halper’s credibility. This unnamed former British intelligence officer adopts a very knowing, almost proprietary, tone, as if to acknowledge that the spying on the Trump campaign was a British-American venture from the start. Ignatius writes, “A former British intelligence officer who knows Halper well describes him as ‘an intensely loyal and trusted U.S. citizen [who was] asked by the Bureau to look into some disconcerting contacts’ between Russians and Americans.”

    “Intensely loyal and trusted,” “asked by the Bureau” — how would he know? These are the insiderish phrases of a handler or fellow member of the ring.

    The size of the London-Langley spy ring isn’t known but its existence is no longer in doubt. In light of it, Obama State Department official Evelyn Farkas’s bragging bears reexamination. It is obvious that gossip about the transatlantic ring had spilled out to State Department circles and other Obama orbits, generating chatter even from a relatively minor figure like Farkas (who may have just been repeating what she had heard at a cocktail party after she left the administration):

    I had a fear that somehow that information would disappear with the senior people who left. So it would be hidden away in the bureaucracy, and that the Trump folks if they found out how we knew what we knew about the Trump folks, the Trump staff’s dealings with Russians, that they would try to compromise those sources and methods, meaning we would no longer have access to that intelligence. So I became very worried because not enough was coming out into the open and I knew there was more.

    Whispers of the ring’s work had picked up by the time Brennan had formed his “inter-agency taskforce” at Langley and Comey’s official probe began. Brennan was presiding over a “turf-crossing operation that could feed the White House information,” as revealingly put by Michael Isikoff and David Corn in Russian Roulette. The operation also crossed an ocean, placing a central scene of the spying in London as the ring oafishly built its file.

    What started in late 2015 with promise ended in panic, with British sources for the alleged Trump-Russia collusion going silent or mysteriously disappearing. A few days after Trump’s inauguration, the director of GCHQ, Robert Hannigan, abruptly resigned, prompting the Guardian to wonder if the sudden resignation was related to “British concerns over shared intelligence with the US.” All of this raises plenty of questions, but one conclusion about this epic fiasco requires no spying: the fingerprints of the British are all over it.

  • Inside Hong Kong's Massive Mail-Order Date-Rape Drug Problem

    In the first four months of 2018, Hong Kong authorities have already seized more GBL, a common date-rape drug, than they did during all of 2017 according to the South China Morning Post, citing a senior Chinese customs agent. 

    Between January and the end of April, authorities recovered 131kg of gamma-Butyrolactone (GBL), a cleaning chemical frequently used in date rapes. To put that in perspective, 124kg of the chemical was seized last year, carrying a street value of nearly HK$4 million (US$512,820). There were no seizures in the first four months of 2017. 

    Colorless and odorless, GBL was listed by Hong Kong as dangerous in 2012 – while trafficking it carries a maximum penalty of life imprisonment and a HK$5 million fine (US$637,393). Users of the common party drug experience feelings of reduced inhibitions and euphoria, while stronger doses can cause sleepiness, confusion and dizziness. 

    Warning bells sounded after a local male model and an Australian man were arrested earlier this month at a flat in Central, where customs officers seized 13 litres of GBL. The drug was believed to be intended for use in Hong Kong’s Lan Kwai Fong nightlife district.

    The arrests were prompted by the discovery at Hong Kong International Airport’s cargo terminal of 10 litres of GBL, with a street value of HK$200,000, in a parcel sent from Lithuania. –SCMP

    After customs officers found 10 liters of GBL hidden in a parcel from Lithuania in mid-May, police posing as couriers carried out a controlled delivery of the shipment to a Hong Kong apartment, where the male model, 53, and a Hong Kong man, 30, were arrested. 

    “Inside the flat, 3kg of the drug Ice, three litres of GBL and 2kg of various illegal drugs such as cocaine, cannabis buds and resin, and Ecstasy were seized along with some tablets of suspected stimulants and packaging equipment,” a customs officer said, adding “We are still investigating how long it had been used as a drug distribution and packaging centre, and we are also looking into the source of the drugs.”

    “We recently noticed some date rape drug in parcels arriving from Lithuania destined for Hong Kong. The parcels stated boldly that the contents were chemicals for industrial use, the customs source said. “The liquid is commonly used as an industrial cleaner in some countries and is perfectly legal. It is widely available on the internet.”

    One online shop based in Lithuania said on its website that GBL could be used as a solvent to remove paint, oil, ink and graffiti. A 350ml bottle costs as little as 16.49 euros (US$19.20).

    “We send orders through DHL across the entire world,” it said.

    In late April, a 25-litre bottle of GBL was found in a parcel from Lithuania when customs conducted a check on an express parcel company in Cheung Sha Wan. On the same day officers arrested two men in an industrial unit in Kowloon Bay, where one more litre of GBL was seized. -SCMP

    The Hong Kong Security Bureau’s Narcotics Division states on its website that GBL can result in drowsiness even at low doses, while leading to unconsciousness or death in higher quantities.

    “This clear, odourless liquid is often used as a date rape drug and is added to flavoured drinks to mask its salty taste,” it stated. “It can be put into a person’s drink when they are not aware, making them vulnerable to sexual assault or rape.”

  • US Army Major Reflects On The Tragic Record Of American Regime Change

    Authored by Major Danny Sjursen via TruthDig.com,

    We used to call him “Mookie.” God, we hated him.

    Back in 2006-07, while patrolling the streets of east Baghdad, Muqtada al-Sadr’s Mahdi Army militia was our sworn enemy.

    These impoverished, slum-dwelling Shiite youths hit us with sniper fire and deadly improvised explosive devices day after day. They killed and maimed American troops daily, including my boys – Alex Fuller and Mike Balsley – who died Jan. 25, 2007. We’d patch up our wounded, call in a medevac helicopter, then roll back into those city streets the very next day. As we patrolled, Sadr’s ubiquitous face would taunt us, plastered as it was on billboards, posters and flags throughout the neighborhood.

    Now, in a truth stranger than fiction, Sadr’s political party has won the recent Iraqi elections. The former warlord and killer of Americans may now play kingmaker in Iraq. Of course, mine is only one – highly biased – side of the story. From Sadr’s perspective, we were occupiers, a foreign military force with no legitimacy in his country. Perhaps he had a point. Still, Sadr’s victory demonstrates just how far off the rails America’s project in Iraq has gone, and it epitomizes the unintended consequences of offensive war and regime change.

    When the United States uses its impressive military machine to topple a tyrant – in this case, Saddam Hussein – it’s impossible to predict the course of the chaos that follows. Fracture a society, it seems, and the most nefarious (and well-armed) actors often rise to the top: militiamen, criminal elements, Islamists and sociopaths of various stripes. Sadr is just one example.

    Still, Washington never seems to learn. Since October 2001, our military has been ordered to topple at least three sovereign governments—those of Afghanistan, Iraq and Libya—and is theoretically seeking to overthrow another regime in Syria. Republican and Democratic presidents alike have ordered these ill-advised operations, demonstrating the striking bipartisanship of American militarism.

    Let us, then, take a tour of the tragic outcomes unfolding today in each of these victims of U.S.-imposed regime change.

    Afghanistan was the “good war,” according to former President Barack Obama—the one we had to fight. After all, Osama bin Laden and al-Qaida central were there. So, less than a month after the 9/11 attacks, American bombs and paratroopers started falling on the Taliban regime throughout Afghanistan. It was all over pretty quick. The Taliban surrendered or fled, bin Laden escaped to Pakistan, and that was that. Only the U.S. military never left. What began as a kill-or-capture mission quickly morphed into a lengthy military occupation and an ill-fated attempt to remake Afghan society in America’s own image.

    How’s that turned out? Well, the Taliban and anti-American insurgency never really ended. In fact, it’s worse than ever. Washington backed a highly corrupt, venal, Afghan government that lacked legitimacy and was chock full of former warlords. Peace is no closer today than it was in 2001.

    Here matters stand in 2018, 17 years into America’s longest war. Consider the biggest story that no one is talking about in today’s Trump-obsessed mainstream media: the recently released report by the Special Inspector General for Afghan Reconstruction. According to this official watchdog agency:

    • Afghan troop numbers are decreasing while casualties are increasing.

    • More Afghan districts are contested by the Taliban than at any time in recent memory.

    • Civilian casualties are increasing.

    • Afghanistan’s Taliban-funding opium crop just reached record levels.

    • Worst of all, Afghanistan’s gross domestic product is so reliant on foreign aid that it cannot sustain itself independently.

    In Afghanistan, the United States turns out to have brought only chaos; to have worsened an already awful social situation. Rather than lessening extremism, U.S. occupation has only emboldened the Taliban and led to the creation of a local Islamic State franchise in Afghanistan’s mountainous east.

    Iraq was a war of choice. Based on flawed—if not deceptive—intelligence, the invasion succeeded in toppling Saddam but ushered in looting, criminality, insurgency and a brutal civil war that has never really ended. By backing the once-oppressed Shiites, the U.S. empowered a chauvinist tyranny of the majority and alienated the country’s Kurdish and Sunni minorities. By 2004, both Sunni and Shiite insurgents (including Sadr’s gang) were attacking U.S. troops and murdering civilians in the streets.

    Matters temporarily improved in 2009-12, when Washington made a desperate play—paying off former insurgents to turn on the most radical Islamists in their midst. Unfortunately, this was but a Band-Aid on a gaping wound, one that couldn’t staunch the chaos over the long term. When conventional U.S. forces left Iraq in December 2011, they left behind a Shiite autocrat who massacred protesters and oppressed minorities. The civil war again ran hot, Islamic State arose and captured one-third of the country, and the northern Kurds essentially declared de-facto independence. Iraq was fractured, divided and blood-soaked—again.

    So it was that U.S. soldiers again re-entered the country. They are still there; fighting and sometimes dying on behalf of a government in Baghdad that will soon be led by one its sworn enemies—Muqtada al-Sadr.

    In Libya, “no-drama” Obama assured us, the U.S. could “lead from behind” and let the mostly European international community do much of the heavy lifting in the takedown of yet another dictator, Moammar Gadhafi. It didn’t turn out that way. U.S. airstrikes devastated the regime’s military and an assortment of tribal militias overturned the Libyan government. Gadhafi? Well, he never saw the inside of an international tribunal; instead he was captured and lynched, beaten, sodomized with a bayonet and shot to death. Secretary of State Hillary Clinton glowed in the aftermath of his murder, boasting that “we came, we saw, he died.”

    Unfortunately, and ever so predictably, Libya never became the liberal, democratic paradise the Obama administration dreamed of. Instead, seven years of factional warfare have followed. Libya is now fractured, divided between the forces of an autocratic general in the east, a tumultuous “official” government in the west, and sprinkled with fiefdoms of numerous Islamist factions, including a new franchise of Islamic State. Unlike George W. Bush, Obama at least seemed to realize his mistake and the mission’s failure, calling the operation a “shit show” and the “worst mistake” of his presidency.

    Libya remains a shit show.

    So that’s the tortured record of American regime toppling and regime “building” in the post-9/11 era. Three unabashed failures; the cost: nearly 7,000 American troops killed, hundreds of thousands of civilians dead, millions of refugees, and trillions of dollar spent.

    The United States, and the world, is no safer now than it was in 2001. Given the counterproductive and horrific results of the “war on terror,” Washington would have been better served had it dug a massive hole in the Mojave Desert, bulldozed in those trillions of dollars and buried them.

    Nonetheless, here we stand, with war hawks atop the Trump administration – led by national security adviser John Bolton and Secretary of State Mike Pompeo – who have repeatedly called for regime change in Iran and North Korea. It’s frightening.

    Here’s a thought: When the war drums start beating again – and they will – let us remember the tragic record of the last three failed regime changes perpetrated by Washington and think long and hard before sleepwalking into the next catastrophe.

    But don’t hold your breath.

  • "We Are Due For A Very Rude Wake Up Call": These Are The Biggest Short-Sellers Of Italian Bonds

    In the aftermath of today’s political shock in Rome in which the populist coalition of the League and 5-Star launched an open rebellion against the president and Brussles, leaving the country facing a referendum on its Euro membership. and resulting in a furious crash in Italian bonds and bank stocks, which on Monday entered a bear market from their April highs…

    … coupled with the sharp, sudden blowout in Bund-BTP spreads to levels suggestive of a news sovereign debt crisis in the Eurozone…

    … and confirmed by the soaring redenomination risk not only in Italy, but also Portugal as contagion begins to spread…

    … left only one question unanswered: why did it take the market so long to react to what many warned was coming as long ago as lat 2017?

    After all, it was in December when we first pointed out a dramatic observation by Citi, which noted that over the past several years, the only buyer of Italian government bonds was the ECB, and that even the smallest political stress threatened a repeat of the 2011 “Berlusconi” scenario, when the freshly minted new ECB head Mario Draghi sent Italian yields soaring to prevent populist forces from seizing power in Italy.

    1

    Or maybe it didn’t, and it only took the bulls far longer than the bear to admit that nothing in Europe had been fixed, even as the bears were already rampaging insider Europe’s third largest economy.

    Consider that according to the latest IHS Markit data, demand to borrow Italian government bonds — an indicator of of short selling — was up 33% to $33.3 billion worth of debt this year to Tuesday while demand to borrow bonds from other EU countries excluding Italy has risen only 5% this year.

    That said, things certainly accelerated over the last week, when demand to borrow Italian bonds soared by $1.2 billion, which according to WSJ calculations, takes demand, i.e. short selling, close to its highest level since the financial crisis in 2008 (while demand to borrow bonds from EU countries excluding Italy has fallen by $800 million over the past week).

    Said otherwise, while the events over the past week may have come as a surprise to many, to the growing crowd of Italian bond shorts today’s plunge and the blowout in Italian-German spreads was not only expected, but quite predictable and extremely lucrative… which is also a major problem as Brussels is well-known to take it very personally when a hedge fund profits from the ongoing collapse of Europe’s failing experiment in common everything, and tends to create huge short squeezes in the process, no matter how obvious the (doomed) final outcome is.

    So who are these hedge funds who better watch their back?

    According to the WSJ, the most prominent Italian short is also the least surprising:

    Among big-name managers profiting from the selloff in Italian bonds is Alan Howard, the secretive billionaire co-founder of hedge fund firm Brevan Howard. A little-known hedge fund run personally by Mr. Howard has been betting that Italy’s borrowing costs will rise relative to Germany’s, said two people familiar with the fund’s positioning.

    And considering the furious spike in the Italian-German spread, one can safe say that Howard is looking at a paper (for now) profit in the hundreds of millions if not more.

    Profits from Mr. Howard’s position in Italy are among bets that have his helped the fund gain 7.5% this month and 13% this year, said one of the people. That makes it one of the top-performing funds to be betting on global bonds and currencies this year.

    Another name making it rain as Italy goes down the drain is Robert Citrone’s Discovery Capital Management. According to the WSJ, Citrone, an alumnus of Julian Robertson’s U.S. hedge fund giant Tiger Management, “has also been betting on Italian bond spreads widening, said a person familiar with the matter.”

    Of course, it is unclear just how long these funds’ winning ways will continue. As the WSJ accurately notes, betting against BTPs has been next to impossible in recent years, because despite the country’s 130% debt-to-GDP ratio and abysmal economic growth, the ECB’s relentless bond-buying has suppressed yields and made shorting the bonds extremely unprofitable.

    Now, however, things are changing, and it is all due to the ECB (again, as we laid out in our December note): “traders say that has changed as the ECB slowly unwinds its stimulus package and political risk rises in Italy.”

    “QE has destroyed any sense of risk in the sovereign bond market and we may be due for a very rude wake-up call once the dust settles,” said Joseph Oughourlian, founder of London-based hedge fund Amber Capital.

    According to the WSJ, Amber has hedged its positions in Italian banks by betting that the spread between Italian and German government bonds will widen and shorting Italian corporate bonds, and for good reason: as BofA recently showed, in Italy there is “close to a staggering 90% of corporate credits” that now yield less than BTPs.

    Yes, this means that according to the market, Italian corporate bonds are safer than the underlying sovereign, in this case Italy, itself, which is virtually impossible in reality, but is all too real thanks to the perverse action of the ECB which continues to buy Italian corporate bonds in the open market week after week, skewing the market beyond comprehension.

    Meanwhile, Oughourlian and other shorters say the new government’s spending plans could push the country’s deficit up by €150 billion ($128 billion) while Rome could try to renegotiate its relationship with Europe; there is also the growing threat of a parallel currency which could effectively lead to a “fork” in the euro and the collapse of the common currency, something which Europe thought it had managed to prevent with the 3rd bailout of Greece in 2015.

    “What’s most troubling is that markets haven’t yet woken up to this major political risk,” Oughourlian said.

    And now that the period of denial is over, everyone else is starting to rush in:

    “We’ve seen increased interest in owning volatility, particularly in European banks—not just Italy but other peripheral names,” said James Conway, EMEA head of equity trading strategy at Citigroup. “The theme [we’re seeing] is owning protection on the periphery.”

    Needless to say, piling on into what is effectively a trade betting on the dissolution of the Eurozone right now is the worst possible outcome, and assures that it is only a matter of time before the ruthless despotic autocrats in Brussels change the rules once again, banning shorting of Italian bonds altogether, or even forcing shorts to immediately cover their positions, leading to another historic, if brief, short squeeze.

    We now eagerly await to see just how long it will take the ECB and Europe’s unelected bureaucrats to put this specific plan into action, crushing countless hedge funds – who still believe in fair and efficient capital markets – in the process.

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May 28

Today’s News 28th May 2018

  • First Greece, Now Italy, Portugal Next?

    While most investors are focused on Italian politics – the parallel currency ‘mini-BoT’ fears and potential for a constitutional crisis – Spain is now facing its own political crisis amid calls for a no-confidence vote against Rajoy. However, ‘Spaxit’ remains a distant concern for investors as another member of the PIIGS peripheral problems is starting to signal concerns about ‘Portugone’?

    And the fundamental data confirms Portugal is next in line for a debt crisis…

    As Statista’s Brigitte van de Pas notes, on average, European Union countries had a gross government debt of roughly 81 percent of GDP in 2018.

    This average disguises real differences between EU countries. Whereas Greece had a government debt of 177.8 percent in 2018, Estonia had a debt of only 8.8 percent – the lowest in the entire EU zone.

    Infographic: Who Has The Highest Debt? | Statista

    You will find more infographics at Statista

    While, the high Greek debt is well-known, a number of other countries however also have a debt that is higher than their own GDP. The Italian debt, for example, is lower than the Greek but still significant, at over 130 percent of GDP. 

    Portugal, in third place, had a debt of 122.5 percent.

    One small positive note though: all three countries had even higher debts in 2017, and the European Commission forecasted a slow, but further decrease of their government debt in 2019. Whether this holds true for Italy, with their newly-elected government of Movimento 5 Stelle and Lega remains to be seen.

  • Russian Navy Tests Four Bulava SLBMs In Salvo

    Authored by Arkady Savitsky via The Strategic Culture Foundation,

    On May 22, the Yuri Dolgoruky Project 955 Borei-class  strategic nuclear ballistic missile submarine (SSBN) – a.k.a. “boomer” -  launched four Bulava RSM-56 missiles from the White Sea within seconds of each other. The destination of the submarine-launched ballistic missiles (SLBM) was the Kura shooting range in the far eastern Kamchatka Peninsula. The test was a success. It was the first time four SLBMs were fired during a naval exercise and the first Bulava trial since June last year. All in all, about 30 tests have taken place since 2004.

    The Borei-class boats will gradually replace Project 941 Akula-class and Project 667 BDRM Delfin class SSBNs to become the core of Russia’s sea strategic component of the nuclear triad at least till 2040. Today, there are three Borei-class submarines in active service. Five more are being built.

    The Yury Dolgoruky is the lead ship. It joined the Navy in 2013. The SSBN carries 16 ballistic missiles. The forth submarine of the Borei class is to meet the 955A standard, with the number of missiles increased to 20 along with many other upgrades.

    Anechoic coating to reduce its acoustic signature covers the boat’s hull. All the equipment is mounted on shock absorbers. It’s widely believed that Russia’s Navy is the only one in the world to have submarines capable of evading US detection.

    All the submarine’s sonars are integrated into a single automated digital system, which both locates targets and fulfills other functions, such as the search for ice openings and the measurement of its thickness. It can detect targets at a distance 50 percent greater than that of US Virginia-class vessels.

    The SSBN has the following specifications: length: 170m, beam: 13,5m, draught: 10m, displacement: surfaced: 14,720t, submerged: 24,000t, depth: 450m, endurance: 100 days, crew: 107. A rescue chamber can accommodate all men aboard. The submarine is propelled by pump-jet propulsion. It is powered by the single water-cooled OK-650 nuclear reactor with a thermal capacity of 190 MW, providing a submerged speed of 29kt and a surfaced speed of 15kt.

    In addition to 16 SLBMs, the Dolgoruky’s armament includes six RPK-2 Viyuga nuclear-tipped anti-submarine missiles launched through 533mm torpedo tubes and capable of striking enemy submarines at a distance of 45km. The vessel can be armed with cruise missiles.

    The Bulava is a derivative of the ground-based Topol (SS-27) ICBM. Its cycle of development was not a bed of roses. There were difficulties on the way. Not all tests were a success but the May 22 training event showed the obstacles have been overcome by Russia’s shipbuilding industry and Navy.

    The SLBM is a three-stage missile to use solid fuel for the first two stages and liquid fuel for the third one to make the missile more agile during warhead separation. The SLBM can be fired on the move or from under the Arctic ice. The trajectory is low enough to make the Bulava classify as a quasi-ballistic missile because it can perform maneuvers in flight or make unexpected changes in direction and range. Along with evasive maneuvers, the Bulava can deploy a variety of countermeasures and decoys making it resistant to missile-defense systems. The independently targetable re-entry vehicles are protected against both physical and electromagnetic-pulse damage.

    The RSM-56 can withstand a nuclear blast at a range of 500m. An operational rage: up to 9,300 kilometers (about 5,770 miles). Circular error probable: 250-300 m. The missile has a length of 12.1m and diameter of 2.1m, launch weight: 36.8 t, throw-weight: 1,150 kg, length (in container): 12.1m.

    The Borei-class SSBN with new Bulava missiles on board was listed by Business Insider UK as an “incredible” Russian weapon system. Its arrival makes possible  the resumption of strategic patrols in southern latitudes after the interval of more than 20 years. The Bulava missiles were fired from a submerged submarine known as a very silent vessel. It could be on patrol anywhere in the World Ocean with potential adversary having no idea where it is. This element of Russia’s nuclear triad offers the best of modern technology to guarantee the inevitability of retaliation in case of attack as it’s impossible to destroy it in a first strike. Retribution is unavoidable with Bulava SLBMs immune to any imaginable missile defense. The May 22 salvo test demonstrated another technological breakthrough to greatly enhance Russia’s strategic nuclear deterrent.

  • Blowing Up The Iran Deal Brings Eurasia Closer To Integration

    Authored by Federico Pieraccini via The Strategic Culture Foundation,

    The annulment of the Iran nuclear deal framework could not be fended off by the visits or entreaties of Merkel, Macron or May. Donald Trump has refused to renew the agreement formally known as the Joint Comprehensive Plan of Action (JCPOA), removing the United States from the deal. In reality, it changes little for Washington, as the US never really removed any sanctions against Iran in 2015, and mutual trust has never risen above minimal levels.

    The American move, which was never surprising, arises from four fundamental factors, namely: the link (especially vis-à-vis electoral financing) between the Trump administration and the Israeli government of Netanyahu; the agreement between Mohammad bin Salman (MbS) and Donald Trump to acquire hundreds of billions of dollars worth of arms as well as investments in the United States; directly targeting European allies like Germany, France and England; and, finally, the wish to please the anti-Iranian hawks Trump surrounded himself with in his administration.

    Israeli Prime Minister Netanyahu and Saudi Prince Mohammad bin Salman are united against Iran and are now publicly cementing their alliance that has hitherto been shrouded in secrecy. The political rapprochement between Saudi Arabia and Israel has been constant over the last 12 months, converging over anti-Iranian interests. Trump’s anti-Iran tilt enjoys support from the Netanyahu and bin Salman clans, representing a 180-degree change in US policy direction away from the one forged through the nuclear agreements reached by the previous administration.

    Saudi money and Israel’s political support (and neoconservative pressure within the United States) are factors important to the Trump administration, particularly as it is besieged by domestic politics and has to deal with the Mueller investigation that buzzes annoyingly around the president of the United States.

    Trump’s need to surround himself with the likes of Pompeo, Haspel and Bolton betrays an acquiescing desire to appease the deep state rather than fight it. Whatever fight might have been present in Donald Trump upon assuming his office has given way to a fruitful collaboration with the deep state. Donald Trump seems to have concluded that it is better to negotiate and find agreements with the deep state than to try, as he promised during his election campaign, to drain the swamp.

    The decision on the JCPOA follows in the wake of other incendiary policies that can be labeled anti-Obama or pro-Israeli and pro-Saudi Arabia, and even anti-European. Washington has been struggling over several years with its medium-term strategic thinking, with decisions often being made suddenly on the basis of emotions or against the backdrop of a constant internal struggle between more or less conflicting elites.

    The most recent example concerns the JCPOA, which seems to confirm a fairly evident trend over the last two years. Washington is starting to think first and foremost about America, focusing more on domestic matters rather than worrying about maintaining the liberal world order and sustaining the global status quo. Trump seems not to operate according to any particular logic or strategy — here renewing sanctions on Russia, there imposing trade tariffs on China, now breaking the agreement on the JCPOA, then bombing Syria, or even seeking an unprecedented rapprochement with North Korea. It is useless to search for any logical train of thought in all this, even less a grand strategy explaining Washington’s ultimate objectives. Policymakers in the US capital act on the basis of very short-term objective, namely: seeking to please Netanyahu and the moneybags that is MBS; punishing Russia; waving the specter of a trade war; asking allies to pay more for defense (NATO); or preventing European companies from working with important partners in Iran and even Russia (Nord Stream 2).

    All this leads to a rifts even amongst European allies themselves, with France and England ready to bomb Syria and threaten Iran, while Germany and Italy oppose such moves on the basis of international law and the need for diplomacy.

    With the undoing of the JCPOA and renewed sanctions on Russia, it seems that European countries finally intend to assert their own sovereignty by legislating against these harmful American actions. The European Parliament intends to adopt a new law that blocks the payment of fines to US authorities by any European company sanctioned for its relations with Tehran. Washington wants to force its European allies to choose between working with Tehran or Washington. It is mafia-like blackmail which even Brussels seems to have had a gutful of and intends to push back against with concrete actions. A similar situation in 1996 involving Brussels led Bill Clinton to suspend such destructive actions among allies in favor of diplomacy.

    Trump seems to worry little about the medium- and long-term effects of his actions, seeming not to have any interest in harmonizing relations with allies, especially Merkel’s Germany, against which Washington has a negative trade balance only exceeded by Beijing. The only point of continuity between Obama and Trump concerns the objection to sabotaging Nord Stream 2 (the pipeline connecting Russia and Germany).

    If the strategic thinking on Trump’s part is non-existent and concerns only very short-term objectives linked to the image that he likes to project of himself (of a tough guy who keeps his electoral promises, such as that regarding the Iranian agreement), the practical effect is that of a strategy that makes little sense from an American point of view. Policy-makers in American think-tanks have seeded many of Trump’s resulting actions, and the blame for the last fifteen years of failed policies can be laid at their feet. They are the true, if unintended, architects of the emerging multipolar world, and have inadvertently served to accelerate the ending of the American unipolar moment.

    Once again, these policy-makers delude themselves into thinking that Trump’s moves — placing sanctions on Russia, a reanimated and bellicose presence and attitude in the Middle East, and the breaking up of the JCPOA – are a great opportunity to achieve some strategic objectives that have been lost over the last few years.

    The calculation of these strategists is wrong and the consequences are quite the opposite to those intended, yet these self-proclaimed experts, blinded by money from dozens of lobbies (the Israel-based lobbyists, for example), become the victims of their own propaganda, insisting on many strategies that directly harm US interests globally and in the Middle Eastern region in particular.

    The policy-makers belonging to such think-tanks as the Brookings Institute or the Center for Strategic and International Studies (CSIS) are more than convinced that strong pressure placed on Iran will arrest the expansion of the Shia Crescent over the Middle East and Iran’s general influence over the region (from Tehran to Beirut via Baghdad and Damascus). The sanctions on Russia and Iran serve, in their mind, to block European energy independence that would otherwise be achieved through cooperating with both countries. The rediscovered bellicosity in the region tends to counter the Russian presence, even if only psychologically, and reaffirms Washington’s willingness to remain committed to the region and defend its interests there (the Saudi dictatorship, above all, thanks to its pricing of oil in US dollars).

    This last point is of enormous importance in terms of global strategy, and Saudi Arabia is a key partner in this regard, the American presence in the region, together with anti-Iranian policies, also serving to reassure the valuable Saudi ally, increasingly courted by Beijing through its petro-yuan convertible into gold.

    Washington finds itself increasingly isolated in its economic and military policies. Merkel’s visit to Russia reaffirms the desire to create an alternative axis to the one between Brussels and Washington. The victory in Italy of two parties strongly opposed to new wars and the annulment of the JCPOA, and especially the sanctions against Russia, serves to form a new alliance, accentuating internal divisions within Europe. Macron, Merkel and May are all grappling with a strong crisis of popularity at home, which does not aid them in their decision-making.

    Exactly the same problems affect MbS, Trump, and Netanyahu in their respective countries. These leaders find themselves adopting aggressive policies in order to alleviate internal problems. They also struggle to find a common strategy, often displaying schizophrenic behavior that belies the fact that they are meant to be on the same side of the barricades in terms of the desired world order.

    In direct contrast, China, Russia, Iran, and now India, are trying to respond to Western madness in a rational, moderate, and mutually beneficial way. And as a result, Europeans may perhaps begin to understand that the future lies not in piggybacking on Israel, Saudi Arabia and the United States. Trump seems to have offered the perfect occasion for European leaders to assert their sovereignty and start to move away from their traditional servility shown towards Washington.

    While it is difficult to imagine a schism taking place overnight, the chances that Europe’s capitals will clash with Washington are no longer so remote, much to the pleasure of Moscow and Beijing, who aim to incorporate Europe into their mega-Eurasian project as the fourth major component after Asia, the Eurasian Union and the Middle East/Persian Gulf.

  • Former President Barack Obama Warns – America "May Not Survive"

    Former President Barack Obama and former first lady Michelle Obama are broadening out these days. They have recently signed a multiyear deal to create their own production company, called Higher Ground Productions, to produce content for Netflix. The pair has recently been spotted on the road, delivering keynote speeches at corporate events and large conferences.

    Mr. Obama delivered a powerful but apocalyptic message about America’s future Wedsenday at a technology conference in Las Vegas hosted by identity security company Okta — where he warned the audience of an uncertain future for America.

    Mr. Obama used his time on stage at Okta Oktane 2018 conference to explain what ventures he is pursuing in his post-presidential years, and further warned about division in America. “We live in a culture today where everybody feels the crush of information and the collision of worlds,” Mr. Obama explained.

    Okta CEO and co-founder Todd McKinnon chats with former president Obama on stage atOkta Oktane 2018 conference. (Source: Okta) 

    At the heart of the issue, the world is more interconnected than ever before, and technology is fundamentally reshaping relationships, as the access to information is rapidly fragmenting society.

    Obama said, “the great thing about the United States is that we have had a head start over the rest of the world in trying to figure this all out.”

    “We are a people that came from everywhere else, so we had to figure out how to join together and work together, not based on race, or religious faith or even, initially, language, but based on creed and a sense of principals,” the former president said

    “All of us are trying to shape and absorb information in ways that can be confusing. If you ask people in Washington DC what identity means, they may well first describe their racial identity.

    By definition, we [Americans] are a nation of people that came from everywhere else.

    I think the big challenge we have today is how do we maintain a sense of common purpose rather than splinter or divide.

    We are seeing this debated on social media every day, but if we don’t figure it out then our society and democracy may not survive.”

    Obama expressed several important ways of how Americans can sustain and develop a national identity, where citizens view themselves as Americans first, rather than being members of a political party, or gender, or race, is by communicating with each other through stories. He said the more we can share stories with one another, the more we can view each other as fellow humans, rather than enemies.

    Obama makes an interesting point, he suggests — Americans should expand their media sources. So no more CNN?

    “Right now part of our polarization is that if you watch Fox News all day, or you read the New York Times, you are occupying two different realities. We have to be able to figure out, in this multiplicity of platforms, to have some common baseline of facts that allow us to meet and solve problems.”

    While Obama cautions the audience about division in America and how it could lead to a collapse, the whole keynote speech seems to be a ploy to subliminally drum up support for his next venture of films and TV shows on Netflix.

    Here is part of Obama’s keynote speech at Oktane 18

    * * *

    After about a year and a half, it seems as the Obamas/Clintons have finally emerged from their Washington war room, and are ready to launch the next phase of an infowar against President Trump. Do not believe us? Well, on Friday, Hillary Clinton announced she wants to be the CEO of Facebook. Can you imagine that? Now that is some next-level shit…Couple it with the Obamas on Netflix pumping out content, and you start to get the picture of an imminent infowar.

  • Crude Capitulation Continues: WTI Hits 6-Week Lows After Russia, Saudi Comments

    WTI Crude futures plunged in early Asia trading – touching a $65 handle for the first time in over a month – after Saudi Arabia and Russia proposed easing output curbs.

    As Bloomberg notes, oil earlier this month rose to the highest level in more than three years after President Donald Trump’s decision to reimpose sanctions on Iran and plunging Venezuelan output fueled supply concerns. With OPEC and allies achieving a key goal of eliminating the global surplus despite record production in the U.S., traders now are weighing whether Saudi Arabia and Russia will go ahead with their plan to revive output without reaching consensus with allies. The group are set to meet in June to decide its next steps.

    The drop was accompanied by relatively heavy volume suggesting some capitulation from the extreme long crude speculative positioning. July WTI futures volume already tops 70,000 contracts — more than 420% of the 10-day average for this time of day — a feat even more impressive given that it’s a public holiday in both London and New York.

    “The latest signal from OPEC and Russia cooled down expectations for the group’s cuts, which have been a major factor boosting crude price since late last year,” Satoru Yoshida, a commodity analyst at Rakuten Securities Inc., said by phone from Tokyo.

    “If OPEC and allies decide at the June meeting to maintain their production cuts through December and ease anxiety among investors, crude prices may rebound.”

    What is perhaps even more impressive is the spread between Brent (geopolitical risk premia) and WTI (domestic ‘over’-supply) is now well over $9 – the highest since March 2015…

  • Why You Should Never Use Wikipedia

    Authored by Eric Zuesse via The Strategic Culture Foundation,

    The latest report about Wikipedia’s corruption comes from the great investigative journalist Craig Murray, who had been in the UK’s Foreign Service from 1984-2004 and who was forced out in 2004 because, having been since 2002 UK’s Ambassador to Uzbekistan, he decided to whistleblow instead of to accept the corruption by his own and Uzbekistan’s Governments.

    Wikipedia’s article about him says that his immediately prior posting had involved participating in enforcement of the prior economic sanctions against Iraq, and “His group gave daily reports to Margaret Thatcher and John Major. In Murder in Samarkand, he describes how this experience led him to disbelieve the claims of the UK and US governments in 2002 about Iraqi WMDs.” So, his disenchantment with UK’s foreign policies seems to have grown over the years, instead of suddenly to have appeared only during the two years in which he was an Ambassador.

    On May 18th, he headlined at his much-followed blog, “The Philip Cross Affair”, and reported: “133,612 edits to Wikipedia have been made in the name of ‘Philip Cross’ over 14 years. That’s over 30 edits per day, seven days a week. And I do not use that figuratively: Wikipedia edits are timed, and if you plot them, the timecard for ‘Philip Cross’s’ Wikipedia activity is astonishing … if it is one individual.”

    He presents reasons to question that it’s a one-person operation, then states that,

    the purpose of the “Philip Cross” operation is systematically to attack and undermine the reputations of those who are prominent in challenging the dominant corporate and state media narrative. particularly in foreign affairs. “Philip Cross” also systematically seeks to burnish the reputations of mainstream media journalists and other figures who are particularly prominent in pushing neo-con propaganda and in promoting the interests of Israel…

    “Philip Cross”‘s views happen to be precisely the same political views as those of Jimmy Wales, the founder of Wikipedia. Jimmy Wales has been on twitter the last three days being actively rude and unpleasant to anybody questioning the activities of Philip Cross. His commitment to Cross’s freedom to operate on Wikipedia would be rather more impressive if the Cross operation were not promoting Wales’ own opinions. Jimmy Wales has actively spoken against Jeremy Corbyn, supports the bombing of Syria, supports Israel, is so much of a Blairite he married Blair’s secretary, and sits on the board of [the neoconservative and neoliberal] Guardian Media Group Ltd alongside Katherine Viner.

    The extreme defensiveness and surliness of Wales’ twitter responses on the “Philip Cross” operation is very revealing. Why do you think he reacts like this? Interestingly enough. Wikipedia’s UK begging arm, Wikimedia UK, joined in with equal hostile responses to anyone questioning Cross.

    In response, many people sent Jimmy Wales evidence, which he ignored, while his “charity” got very upset with those questioning the Philip Cross operation.

    Wikimedia had arrived uninvited into a twitter thread discussing the “Philip Cross” operation and had immediately started attacking people questioning Cross’s legitimacy. Can anybody else see anything “insulting” in my tweet?

    I repeat, the coincidence of Philip Cross’s political views with those of Jimmy Wales, allied to Wales’ and Wikimedia’s immediate hostility to anybody questioning the Cross operation – without needing to look at any evidence – raises a large number of questions.

    “Philip Cross” does not attempt to hide his motive or his hatred of those whose Wikipedia entries he attacks. He openly taunts them on twitter. The obvious unbalance of his edits is plain for anybody to see.

    Among the hundreds of reader-comments to that article, one seems to have come from a Wikipedia-insider, and is abbreviated here:

    Andrew H

    May 18, 2018 at 18:49

    … Wikipedia is a source of information, and so cannot peddle alternative theories of any kind. …[and] no doubt there is some political bias that comes into this process. If you look at the article on the Skripal’s – it is not unreasonable – almost all statements are supported by references to main stream media articles or statements from official organisations such as the Russian government, OPCW or UK authorities. This is what it has to be. (you wouldn’t seriously be suggesting that Wikipedia should have links to craigmurrary or info from RT?).

    I haven’t done any scientific study of the sources that are cited in Wikipedia’s many footnotes and whether sites such as Murray’s and RT are banned from them, but this article by Murray does suggest that the bias in favor of mainstream, and against small, ‘news’media, does adhere to the pattern that’s succinctly stated by “Andrew H.” Murray presents remarkable documentary evidence that this is Wikipedia’s pattern. “Andrew H” seems to believe that it’s the right pattern to adhere to. 

    The present writer also has personal experience with Wikipedia that confirms the existence of this pattern. Among my several articles on that, was “How Wikipedia Lies”, in which I reported that “Smallwood,” the Wikipedia overseer on Wikipedia’s article “United Airlines Flight 93” about the 9/11 plane that came down in Pennsylvania, blocked stating in the text of the article an important fact that was documented even buried within some of the article’s own footnote sources – all coming from mainstream media – that Vice President Dick Cheney had ordered that plane to be shot down and that, therefore, the article’s (and the ’news’media’s and ‘history’ books’) common allegations that resistance on the part of heroic passengers on that plane had had something to do with the plane’s coming down when and how it did, are all false. “Smallwood” blocked me from adding to the text a mention that Cheney on the very day of 9/11 admitted that he had ordered that plane to be shot down and stated his reasons for having done so, and that the order was promptly fulfilled; and “Smallwood” refused to say why my addition of Cheney’s role was blocked, other than that to say that that fact “did not appear constructive.” (He refused to say how, or why.)

    Back on 8 July 2015, I had headlined, “Wikipedia As Propaganda Not History — MH17 As An Example”, and reported and documented regarding the MH17 Malaysian airliner shot down over Ukraine, that “Wikipedia articles are more propaganda than they are historical accounts. And, often, their cited sources are misleading, or even false.” The Wikipedia article on that was anti-Russian propaganda, not a historical account.

    As I mentioned in those articles, even Britain’s own BBC had previously headlined, “Wikipedia ‘shows CIA page edits’.” What both Murray, and I, in my latest article about Wikipedia, add to that information regarding some of the people who “edit” Wikipedia, is that Wikipedia itself, in the individuals whom it hires to nix or else to accept each editorial change that is being made to a given article, actually also, in effect, writes Wikipedia articles – and that it does so consistently filtering out facts – no matter how conclusively proven to be true – that contradict the ‘news’media’s (and CIA’s) boilerplate ‘history’ of the given matter. In other words: Wikipedia is a perfect embodiment of the type of society that was described in the fictional 1949 allegorical novel, 1984.

    This is the reason why I never link to a Wikipedia article unless I have independently confirmed that, regarding the fact for which I cite the given article, that article is honestly and truly representing that matter, or that given detail of it. I do not exclude truths that happen to be included in the standard account; but neither do I (as Wikipedia does] exclude facts which contradict the standard account.

  • On Memorial Day, A Marine Remembers Syria Before The War

    During a recent White House meeting between President Trump and NATO Secretary General Jens Stoltenberg, Trump had some surprising commentary on the war in Syria, and specifically the way life was for Syrians before 2011: “It was a great culture before it was so horribly blown apart. A place where people would go…” he said in the televised meeting.

    What did the president mean by this? He explained that Syria was highly stable before the war, and even an attractive place to travel: “Syria will start to stabilize. You see what’s happening, it’s been a horror show. I have great respect for Syria and the people of Syria – these are great people… .. it was the place to go and you look at what’s happened it’s so sad. But I’d like to see Syria come back.“

    https://platform.twitter.com/widgets.js

    While we don’t quite now if Trump would like to see Syria “come back” on the Syrian people’s own terms, or if he has more of the usual Washington regime change playbook in mind, his somewhat off the cuff remarks present an important point question: why does no one ever talk about what Syria or any other society that’s suffered under the disastrous hand of US intervention was like before the war? 

    The below is authored by US Marine veteran Brad Hoff, and is used by Zero Hedge with permission:

    * * *

    “He who has not lived in the years before the revolution cannot know what the sweetness of living is.”

    — Talleyrand, via Bertolucci, from the 1964 film Prima della Rivoluzione

    IRAQ, LIBYA, SYRIA… Countries ripped apart through sectarian and political violence in the aftermath of cataclysmic external interventions: American invasion and occupation in Iraq, NATO intervention in Libya, and international proxy war in Syria. Mere mention of these countries conjures images of sectarian driven atrocities and societal collapse into the abyss of a Hobbesian jungle. And now it is commonplace to just assume it’s always been so. Increasingly, one hears from all corners of public discourse the lazily constructed logic, “but they’ve always hated each other”… or “violence and conflict are endemic to the region.” But it was not always so — I found a place of beauty, peace, and coexistence in a Syria that is now almost never acknowledged, and which risks being forgotten about.

    But Syrians themselves will never forget.

    I served in the Marine Corps during the first years of the Iraq War and was activated as post-9/11 emergency security personnel to headquarters assets in the D.C. area while stationed at Headquarters Battalion Quantico. I thought I knew something about Iraq upon the start of our new “war on terror”: Arab culture, with its intrinsic primal religious passions and resulting sectarian divisions, must be brought to heel under Western values of pluralism, secularism, and equality if peace and stability are to ever have a chance. This was a guiding assumption among the many Marine officers, active and retired, that I conversed with during my years at Quantico. Iraqis and Middle Easterners were, for us, abstractions that fit neatly into categories learned about by viewing a C-SPAN lecture, or perhaps in a college class or two: there are Sunnis, Shia, some dissident sects, they all mistrust each other, and they all want theocratic states with their group in charge.

    Author (left) in a Syrian village in Homs countryside. This quiet Christian village would later be attacked by anti-government fighters.

    My first visit to the region while desiring to study Arabic in 2004, just after completion of active duty service, and while still on the inactive reserve list, began a process of undoing every assumption I’d ever imbibed concerning Middle East culture, politics, and conflict. An initial visit to Syria from Lebanon was the start of something that my Marine buddies could hardly conceive of: Damascus became my second home through frequent travel and lengthy stays from 2004 to 2010, and was my place of true education on the real life and people of the region. While fellow service members were just across Syria’s border settling in to the impossible task of occupying a country they had no understanding of, I was able view a semblance of Iraq as it once was through the prism of highly stable Ba’athist Syria.

    The other dominating interest that drew me to Syria was the country’s ancient churches and Christian communities. Discovery of the much neglected truth that the region has always been much more diverse than tends to be acknowledged did much to undo the false assumptions of my Texas Baptist childhood. I must admit that I grew up with the usual American stereotypes of the Middle East. To most Americans, the notion of Middle Eastern Christianity sounds like an oxymoron — or is at the very least highly suspect. Many Arab and Eastern Christians are asked, upon arriving in the U.S. for visit, work, or immigration, “when did you convert from Islam?” During the post 9/11 Bush years, when Syria as part of the “Axis of Evil” became a central formulation of U.S. foreign policy, such common cultural assumptions became even more deeply ingrained. How could one be a Christian and a citizen of a “rogue” Middle East state? And yet, Christians have called Syria their home for many hundreds of years prior to the foundation of the modern nation-state of Syria.

    As I began to learn more about the multi-ethnic and religiously mixed kaleidoscope that is modern Syria, I marveled at how such a country could live in relative peace and stability in a region commonly perceived to be one of the most historically tumultuous and war racked on Earth, and I had to go and see for myself.

    * * *

    During my first weeks in Damascus, I was pleasantly shocked. My preconceived notions were shattered: I expected to find a society full of veiled women, mosques on every street corner, religious police looking over shoulders, rabid anti-American sentiment preached to angry crowds, persecuted Christians and crumbling hidden churches, prudish separation of the sexes, and so on. I quickly realized during my first few days and nights in Damascus, that Syria was a far cry from my previous imaginings, which were probably more reflective of Saudi Arabian life and culture. What I actually encountered were mostly unveiled women wearing European fashions and sporting bright makeup — many of them wearing blue jeans and tight fitting clothes that would be commonplace in American shopping malls on a summer day. I saw groups of teenage boys and girls mingling in trendy cafes late into the night, displaying expensive cell phones. There were plenty of mosques, but almost every neighborhood had a large church or two with crosses figured prominently in the Damascus skyline. As I walked near the walled “old city” section, I was surprised to find entire streets lined with large stone and marble churches. At night, all of the crosses atop these churches were lit up — outlined with blue fluorescent lighting, visible for miles; and in some parts of the Damascus skyline these blue crosses even outnumbered the green-lit minarets of mosques.

    Just as unexpected as the presence of prominent brightly lit churches, were the number of restaurant bars and alcohol kiosks clustered around the many city squares. One could get two varieties of Syrian-made beer, or a few international selections like Heineken or Amstel, with relative ease. The older central neighborhoods, as well as the more upscale modern suburbs had a common theme: endless numbers of restaurants filled with carefree Syrians, partying late into the night with poker cards, boisterous discussion, alcohol, hookah smoke, and elaborate oriental pastries and desserts. I got to know local Syrians while frequenting random restaurants during my first few weeks in Damascus. I came into contact with people representative of Syria’s ethnically and religiously diverse urban centers: Christians, Sunni Muslims, Alawites, Druze, Kurds, Armenians, Palestinians, and even a few self-declared Arab atheists. The characterization of Syrian city life that increasingly came to my mind during my first, and many subsequent visits and extended stays, was of Syria a consciously secular society when compared to other countries in the region.

    Nights full of parties and dancing in Syrian homes. Author is behind the camera quickly overcoming his prior false orientalist stereotypes.

    In the more traditional countryside, life moved at a slower pace. From my experience in villages from the Hauran region in the South, to Homs countryside in central Syria, there arose a common theme: a duality of work (typically agriculture) and family oriented leisure — with the year regulated by a pattern of village celebrations for weddings, baptisms, graduations, birthdays, and religious festivals. Movement of time in the village seemed to bring with it a palpable “lightness of being” — especially in the more picturesque mountain villages in places like the Valley of the Christians (Wadi al-Nasara) near Homs. The typical Fridays, Saturdays, or Sundays in most any Syrian village were spent with extended family and village friends gathered on a patio around a slow burning coal barbeque pit. This is not unlike an American style barbeque, but the Syrian version tended to last for eight or more hours, and was sometimes a village-wide affair that easily extended to an evening party with live music. Women socialized while making kibbe and tabbouleh by hand (an hours-long affair) — so that food preparation itself became a kind of natural social ritual. Men exchanged news and speculated about village rumors, fanned the slow burning coal and endlessly sipped tea, strong Arabic coffee, and smoked cigarettes or hookah pipe.

    Though much is now said of Syria’s sectarian divisions, religiously mixed villages were everywhere, and operated not much differently from religiously or ethnically homogeneous villages. If there was a party on the occasion of a Muslim holiday, Christians and Alawites came out and joined in on the feasting and traditional dancing. During Christmas and Easter parties, or for the Feast of St. George, Muslims were heard giving a “Merry Christmas” and other greetings of respect to Christians, and joined in on the festivities. In the multiple mixed Druze and Christian villages of the ancient Hauran region, there were common-use village party grounds situated near the main entrances to villages, which were used to celebrate weddings and national holidays. If a wedding took place, it was expected that all families of the village would come out — whether the wedding was Muslim, Druze, or Christian. The village patriarchs, including the local Orthodox priest, the Catholic priest, and Druze cleric, would attend the joint celebration.

    Qraya is an example of one such diverse village set amidst the black volcanic crusted plains of the Hauran region (from the Aramaic word which means “cave land”). A somewhat recently erected gray and white concrete mosque memorial commemorating the “Great Syrian Revolution” — the 1925–1927 revolt that solidified Syrian national feelings during the French Mandate period, towers over the sleepy village. In 2009 the Syrian government, in an official ceremony, interred the remains of celebrated Druze patriarch Sultan Hilal al-Atrash there. He led what was initially a mass Druze revolt against the French, which had been ruling Syria since the close of World War I. What began as a Druze revolt primarily focused in southern Syria’s Jabal al-Druze(literally “Druze Mountain”) was soon joined by Sunnis, Christians, and Alawites. This represented Syria’s first popular movement toward nationalism which reached “street level” across the different segments of French-ruled Syria. Reflecting the far reaching impact and diverse appeal of the anti-colonial revolt, al-Atrash famously said, “Religion is for God, the fatherland is for all.”

    With similar sentiment, Syrians that reject the notion of the contemporary conflict as a mere sectarian driven crises are now often heard to reply with a simple “I am Syrian” when asked about their religious identity.

    * * *

    I certainly witnessed plenty of examples of Islamic conservatism in Syrian public life, but it was the secular and pluralistic (represented in the diverse population living side by side) aspect that always seemed to dominate, whether I was in Damascus, Homs, Aleppo, or coastal areas like Tartus. Syria’s committed secular identify was confirmed to me more than ever when I first traveled the freeway that wraps around Mt. Qasyoon — the small mountain against which the Damascus urban center is nestled. My speeding taxi passed a couple of expansive foreign car dealerships, but most prominent were a seeming myriad number of windowless entertainment venues, structured like residential mansions, lining both sides of the road. My taxi driver laughed at my perplexed expression and informed me that this was “brothel row” (my translation) — a red light district of sorts. When I later got to know a group of Syrian guys — enough to where I could ask potentially awkward or embarrassing questions — they confirmed, with some degree of shame, that all big cities in Syria have their seedy underbellies (“like your Nevada,” my friend Michel said). Places like brothels and “pick-up bars” were allowed to operate in public, but didn’t necessarily advertise what they were about. My Syrian friends looked upon this “dark side” of Syrian society with no less moral revulsion than the local conservative Muslims. Yet, it was explained to me that while the Syrian government was deeply authoritarian in some respects, it generally allowed (and enforced) openness in social and religious areas unparalleled anywhere in the Middle East. Most Americans would be very surprised to learn of such elements in Syrian society that are not much different from what one would find in Europe or the U.S.

    This social openness was most clearly to the advantage of Christians and other religious minorities living in a country numerically dominated by the about 70% Sunni Muslim majority. The secular face of the government and civic life allowed Christians to worship freely, and to even display their Christianity very publicly. My first experience of this came one particular winter evening in the Qassa neighborhood near Bab Touma — the expansive and most well-known among the Christian neighborhoods of Damascus. A special dignitary, the Orthodox Archbishop of Finland, was visiting a local church. He was greeted with a parade that took over an entire city street. He processed down the street and into the church with a uniformed marching band leading the way, made up of a local Christian scouting organization.

    I witnessed similar displays especially at Christmas and Easter in all different parts of Syria: public processions, church bells ringing loudly, Christmas trees and lights, images of Jesus displayed prominently, church music blaring over loud speakers, and exuberant wedding parties. One small city, Maaloula — an hour northwest of Damascus, even had its annual local public holiday in celebration of the cross which Syrian news depicted as attracting tens of thousands of people.

    The cross and the crescent side by side in the historic walled “old city” of Damascus.

    Prior to visiting Syria, I would have never conceived of the possibility of state TV in a Middle Eastern country actually airing coverage of a Christian festival. My Syrian friend, upon seeing my incredulous gaze as churches were being shown on the main government channel, shrugged and told me, “but this is Syria.” To him, Syria was stood alone in the region as an example of Christians and Muslims living together in peace and as equals. A Syrian could look for confirmation of this to his western border, where Lebanon was still attempting to come to grips with its two decades long sectarian civil war; or he could look immediately east, where Iraq’s ethnic and religious divisions were blowing up under U.S. and Coalition occupation; or north to Turkey, where it was illegal to discuss the Greek and Armenian genocide in public; as well as to the Arabian peninsula — where a culture of Sharia courts and religious police made church only a thing for Western expat workers living their lives within walled ARAMCO communities. But the cross and the crescent appeared side by side in every major Syrian city. Such public pluralism, where Christianity received constant public acknowledgement side by side with Islam, was the greatest surprise upon my initial visit to Syria.

    All in all, what I unexpectedly observed in Syria was a high degree of personal freedom not found in other countries of the Middle East. This personal freedom was exercised in all areas of life except for politics — a strange paradox. The government seemed to leave people alone in areas of religion, social behavior, family life, and work pursuits; but political dissent was not tolerated, and Syrians seemed to accept this as a difficult fact of life. The average working class Syrian was resigned to accept the government promise of security and stability in exchange for limitations upon personal political freedoms. With multiple religions and ethnic groups living side by side in a volatile region full of historic and hidden animosities, as well as ceaseless external geopolitical pressures, it seemed a sensibly practical, even if unjust, solution. There was a palpable feeling of an “enforced secularism” binding Syrian society together.

    The kind of religious and cultural pluralism represented in the liberal democracies of the West was present in Syria, ironically, through a government mandated “go along, get along” type policy backed by an authoritarian police state. One can even find Syrian Jews living in the historic Jewish quarter of Damascus’ walled old city to this day. I was told, upon visiting their synagogue, that most had gone to Brooklyn, though there were perhaps a dozen families left.

    Hauntingly beauty in the midst of war: the sleepy village of Saidnaya sits at the edge of the conflict-ridden Qalaman mountains.

    Just prior to early 2011, as the so-called “Arab Spring” movement which had enveloped Tunisia, Egypt, and Libya, seemed to be potentially losing steam, I was at first deeply skeptical that a mass uprising would gain traction in Syria. Syria had plenty of deep seated problems as a nation run by an old school Arab socialist ruling clique; but too much of the population, especially in the major cities, seemed heavily invested in the status quo ensured by a stable regime, however less than ideal the status quo might have been.

    When Assad unexpectedly came to power in 2000 after the deaths of his father and brother, he promised to take Syria into a new, modern age of reform. These were the days of “early Assad,” when many in Washington declared “Assad is a reformer” (Hilary Clinton was declaring this even as late as the early part of 2011). But the Syrian government has always been much more than a dictator, or even a ruling family. Even should President Assad desire reform, the old elites which form the outer circles of Ba’ath influence provide a strong “check” on what even he might hope to enact. The economic fortunes of these institutional elites were dependent on the Assad status quo, and this made the type of drastic change that leaders in Western capitals suddenly demanded practically impossible. In addition, the middle class families of the most populace cities, especially Damascus and Aleppo, were not discontent enough to go to the streets. This, not too much unlike middle-class Americans who merely shrugged when mass government abuses like domestic spying and pervasive government breaking of Constitutional rights were definitively revealed in 2013.

    Most Syrians I knew were deeply fearful of a sudden cataclysm that might send Syria the way of sectarian Iraq, especially a program that took decision making away from actual Syrians. News savvy Syrians even had Western sponsored “democracy experiments” more recent in time than Iraq to consider: Post-Gaddafi Libya began to unravel from the moment of its “liberation” by NATO. As international press generally fell silent on new Libya’s slow descent into chaos at the hands of accountable-to-no-one armed militias, it focused its eye on unreformed Syria. A few attempts at Facebook sponsored “days of rage” protests failed to gain any traction inside Syria, to the great disappointment of self anointed “democracy promoters” in the West. I was personally relieved during this brief period of Arab Spring “inactivity” — the examples of Egypt and Libya (and to some extent Tunisia) were making it abundantly clear that the main beneficiaries of this “springtime” were political Islamists from the the Muslim Brotherhood, to Ennahda Party (the Salafist Tunisian party), to the Libyan Islamic Fighting Group (an Al-Qaeda linked terror organization). The losers were increasingly the Arab Left, the secularists, and the religious and ethnic minorities.

    * * *

    It is simply a self evident premise that the so-called “Arab Spring” has resulted not in greater democracy and individual liberties across the Middle East, but in the political and military ascendancy of radical Islamist groups from North Africa to the Levant. Most Americans are still unaware of the shocking extent to which Washington has aided, and is currently aiding, radical Islamic groups that are indistinguishable from Al-Qaeda throughout the course of these revolutions. This occurred openly and most directly in Libya through American-led NATO bombing (after which the first flag to fly over the main Benghazi courthouse was that of Al-Qaeda), and has now long been occurring clandestinely in Syria, though certainly an open and increasingly acknowledged “secret”. The most radical insurgent groups the world has ever seen have popped up all over Syria as the Washington and Gulf allies’ Frankenstein creation fought for years aiming at regime change in Damascus. It should come as no surprise that Syria’s vulnerable religious minority communities were the first to feel the wrath of these groups.

    A destroyed icon from the village of Maaloula, after it was taken over by Western and Gulf backed rebel forces in 2013. Source: Syrian Orthodox Patriarchate of Antioch

    Disturbingly, Syria continues to be liquidated of its Christians and other religious and ethnic minorities (or really anyone desiring a pluralistic and relatively secular nationalistic public order) — a reality that was set in motion near the very beginning of armed uprising in Syria. America, NATO, and Arab Gulf countries continue to give political and material support to a Syrian “rebel” movement that is bent on exterminating Christians, Alawites, Shiites, Druze, and Muslims that don’t share the same radical ideology. One popular chant which throughout the war has been routinely echoed in rebel-dominated areas of Syria is “Christians to Beirut and Alawites to the grave… .” Sadly, the seemingly endless number of takfiri insurgent groups unleashed on Syria have tried to make good on that promise.

    Pre-war Syria was certainly not ideal; but the fruit of revolution — a country thrown into a state of utter chaos and destruction, cyclic violence, and economic ruin for at least years to come — has revealed itself to be, for most common sense people, the greatest of all possible evils.

    * * *

    Brad Hoff served as a Marine from 2000–2004 at Headquarters Battalion, Quantico. After military service he lived, studied, and traveled throughout Syria off and on from 2004–2010. 

  • Hong Kong Women Left Unsatisfied By "Grass-Eating" Sexless Nerds

    Last month we told you about China’s record-low fertility rate and social stigma around having a large family. Today, we bring you another aspect of that equation; lame, feminized Chinese men who refuse to step up their game and get laid. 

    Yes, Hong Kong is suffering from an army of loners – estimated at 20,000 to 40,000 strong – usually in their 20’s and 30’s, who are choosing video games, anime and internet porn over wives, sex and the inevitable children that follow.

    We can blame the prevalence of smartphones, laptops, computers, tablets and other electronic devices. We can even blame it on e-sports, a new pseudo sport that is sweeping the city with government backing. It can also be interpreted as another excuse for people to submerge themselves in the digital world rather than experience the real word. –SCMP

    These sexless men are known as “otaku,” – a Japanese term for socially awkward gents who have isolated themselves from their families and romantic prospects alike. “[T]hese “geeks” tend to be diehard anime and manga fans who have little interest in dating,” writes Luisa Tam in the South China Morning Post. 

    Taking it one step further are the “soshoku danshi,” which translates to “grass-eating men” or “herbivore men” – a term coined by Japanese columnist Maki Fukasawa who describes these particular isolationists as having a “monk-like approach to life and relationships,” which of course includes no sex. 

    Studies in Japan estimate that this class of men, normally in their 20s and 30s, account for around 60 per cent to 70 per cent of the male population. Obviously, their reluctance to procreate is a major cause for concern. Japan has had one of lowest birth rates in the world for nearly a decade now. –SCMP

    Hong Kong has seen a sharp rise in the number of “grass-eating men,” according to Dr. Paul Wong Wai-ching, associate professor of the Department of Social Work and Social Administration at hte University of Hong Kong. 

    According to Dr Paul Wong Wai-ching, associate professor of the Department of Social Work and Social Administration at the University of Hong Kong, the city has seen a rise in the number of “grass-eating men”.

    “These herbivore men don’t connect with others, they don’t establish their own families or have children and don’t really contribute anything meaningful to society, either tangibly or intangibly,” says Wong. “They are like parasites who often live with their parents. So you can imagine how it’s going to affect society in the long run, socially and economically.”

    Wai-ching notes that similar to Japan, China’s society is aging. “These ‘grass-eating men’ are not capable of taking care of their ageing parents and neither are they capable of taking care of themselves when they become old, they are childless so they will have no family support,” he says.

    Another type of man you won’t be finding on any dating apps are the “modern-day hermits”. They seek extreme disconnection and isolation from the rest of society, they become practically invisible. This phenomenon is triggered by an overburdened sense of responsibility, and when the pressure becomes too unbearable it causes the person to pull away and unplug from society in a kind of self-imposed exile. 

    What’s worse, after a long period of social detachment, these men lose their social skills – affecting their ability to find employment. This, as Tam writes, has a domino effect of creating youths who are financially dependent on family and friends – jobless and lacking in drive. This vicious cycle leads to a failure to launch – leaving many of these “otaku” without long term relationships, romantic or friend-based. 

    A recent study found that cows form relationships and even have best friends. When separated from their best friend, their milk production was affected and they showed a change in personality.

    Think about it, if these bovine grass-eaters showed signs of emotional distress because of a lack of emotional contact, how will human “grass eaters” fare if they shut themselves off from human contact?

    Forget the nerds, China’s already in big trouble…

    According to the Wall Street Journal, “China’s clinging to birth restrictions defies a clear demographic trend: Its workforce is shrinking and the population is rapidly aging. By 2050, there will be 1.3 workers for each retiree, according to official estimates, compared with 2.8 now,” adding “No matter what the government does now, it is too late to significantly change the overall trend because of social attitudes”

    President Xi Jinping has acknowledged the need to breed – stating in 2015 that China needs more births.

    Meanwhile, China’s one-child policy, and now two-child policy, has conditioned the population to shun large families. 

    In a generation that grew up without siblings, a one-child mind-set is deeply entrenched. Maternity-leave policies have been expanded but some women say taking leave twice is a career impediment. An All-China Women’s Federation survey found 53% of respondents with one child didn’t want a second.

    Even without birth limits, China’s economic development would have reduced fertility rates, says Martin Whyte, a Harvard University Chinese-studies expert. That has been the pattern elsewhere in the world: When incomes rise, the sizes of families tend to go down. –WSJ

    If the nation drops birth policies now, says Whyte, “China will learn what many other countries have learned—that it is much more difficult to get people to have more babies” than to force them to stop having them.

    “I think Xi’s views about demography are clear: He considers population more as a resource than a burden,” said Huang Wenzheng, a researcher at the Center for China and Globalization, a Beijing-based independent think tank, and a co-founder of a hedge-fund firm that invests globally. “But of course he cannot easily abandon the family-planning policy because that would be a sharp turn away from his predecessors’ policies.”

    How is this happening?

  • Why America Is Heading Straight Toward The Worst Debt Crisis In History

    Authored by Michael Snyder via The Economic Collapse blog,

    Today, America is nearly 70 trillion dollars in debt, and that debt is shooting higher at an exponential rate.

    Usually most of the focus in on the national debt, which is now 21 trillion dollars and rising, but when you total all forms of debt in our society together it comes to a grand total just short of 70 trillion dollars.  Many people seem to believe that the debt imbalances that existed prior to the great financial crisis of 2008 have been solved, but that is not the case at all.  We are living in the terminal phase of the greatest debt bubble in history, and with each passing day that mountain of debt just keeps on getting bigger and bigger. 

    It simply is not mathematically possible for debt to keep on growing at a pace that is many times greater than GDP growth, and at some point this absurd bubble will come to an abrupt end.  So those that are forecasting many years of prosperity to come are simply being delusional.  Our current standard of living is very heavily fueled by debt, and at some point we are going to hit a wall.

    Let’s talk about consumer debt first.  Excluding mortgage debt, consumer debt is projected to hit the 4 trillion dollar mark by the end of the year…

    Americans are in a borrowing mood, and their total tab for consumer debt could reach a record $4 trillion by the end of 2018.

    That’s according to LendingTree, a loan comparison website, which analyzed data from the Federal Reserve on nonmortgage debts including credit cards, and auto, personal and student loans.

    Americans owe more than 26 percent of their annual income to this debt. That’s up from 22 percent in 2010. It’s also higher than debt levels during the mid-2000s when credit availability soared.

    We have never seen this level of consumer debt before in all of U.S. history.  Just a few days ago I wrote about how tens of millions of Americans are living on the edge financially, and this is yet more evidence to back up that claim.

    Right now, Americans owe more than a trillion dollars on auto loans, and we are clearly in the greatest auto loan debt bubble that we have ever seen.

    Americans also owe more than a trillion dollars on their credit cards, and credit card delinquency rates are rising.  In fact, in some ways what we witnessed during the first quarter of 2018 was quite reminiscent of the peak of the last financial crisis…

    In the first quarter, the delinquency rate on credit-card loan balances at commercial banks other than the largest 100 – so at the 4,788 smaller banks in the US – spiked in to 5.9%. This exceeds the peak during the Financial Crisis. The credit-card charge-off rate at these banks spiked to 8%. This is approaching the peak during the Financial Crisis.

    The student loan debt bubble has also surpassed a trillion dollars, and the average young adult with student loan debt has a negative net worth…

    Despite economic and stock market gains over the past nine years, many young adults are still struggling to get ahead in their financial lives and, in some ways, things may have actually gotten worse.

    Americans age 25 to 34 with college degrees and student debt have a median net wealth of negative $1,900, according to a report analyzing 2016 Federal Reserve data released Thursday by Young Invincibles, a young adult advocacy group. That’s a drop of $9,000 from 2013, YI’s analysis found.

    Meanwhile, corporate debt has doubled since the last financial crisis.  Thousands of companies are so highly leveraged that even a slight economic downturn could completely wipe them out.

    State and local government debt levels are also at record highs, but nobody seems to care.  And if we never have another recession everything might work out okay.

    The biggest offender of all, of course, is the United States federal government.  We have been adding about a trillion dollars a year to the national debt since Barack Obama first entered the White House, and Goldman Sachs is projecting that number will surpass 2 trillion dollars by 2028…

    The fiscal outlook for the United States “is not good,” according to Goldman Sachs, and could pose a threat to the country’s economic security during the next recession.

    According to forecasts from the bank’s chief economist, the federal deficit will increase from $825 billion (or 4.1 percent of gross domestic product) to $1.25 trillion (5.5 percent of GDP) by 2021. And by 2028, the bank expects the number to balloon to $2.05 trillion (7 percent of GDP).

    Our national debt has been growing at an exponential rate for decades, and because total disaster has not struck yet many people seem to believe that we can keep on doing this.

    But the truth is that it simply is not possible.  There is only so much debt that a society can take on before the entire system implodes.

    So how close are we to that point?

    The following chart comes from Charles Hugh Smith, and it shows the exponential rise in overall debt levels that has taken us to the brink of nearly 70 trillion dollars in debt…

    And this next chart from the SRSrocco Report shows how our rate of overall debt growth has compared to our rate of GDP growth…

    We are literally on a path to national suicide.

    Whether it happens next month, next year or five years from now, it is inevitable that we are going to slam into a brick wall of financial reality.

    For the moment, the only way that we can continue to enjoy our current debt-fueled standard of living is to continue increasing our debt bubble at an exponential rate.

    But that can only go on for so long, and when the party ends we are going to experience the greatest debt crisis in history.

    Today, the average American household is nearly $140,000 in debt, and that is more than double median household income.  And if we were to include each household’s share of corporate debt, local government debt, state government debt and federal government debt, that number would be many times higher.

    All of this debt will never be repaid.  Ultimately there will come a day when the system will completely collapse under the weight of so much debt, and most Americans are completely unaware that such a day of reckoning is rapidly approaching.

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May 27

Today’s News 27th May 2018

  • Brazilian Military Deployed To Break Up Trucking Strike As State Of Emergency Worsens

    A nationwide trucking strike in Brazil entered day six on Saturday, as blocked roads have prevented critical food and supplies from reaching their destinations.

    The protests, triggered by a 50% spike in fuel prices over the last year, have resulted in the declaration of a state of emergency across most major cities as shelves run bare and fuel supplies dwindle. Airports have reported running out of fuel, hospitals are running out of supplies, and public transport and trash collection have been reduced or halted across the country. Some food prices have also spiked as supplies dwindle. As we noted on Friday, a lack of livestock feed threatens a billion chickens and 20 million pigs who may starve to death.

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    Brazilian export group ABPA said that over 150 poultry and pork processing plants had indefinitely suspended production, while Brazil’s sugar industry – the world’s largest – is slowly halting cane harvest operations as their machines run out of fuel.

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    Despite a Thursday agreement with the truckers and the Friday deployment of the military to physically unblock roads, the government has only reported a few blockades being lifted on major highways. 

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    In an attempt to end the dispute, oil company Petrobas cut the price of diesel by 10% for two weeks – however all that did was scare investors. The truckers were not impressed, considering that they’ve been subject to fuel price increases of around 50% over the last year.

    Petrobras shares plunged after the announcement and are down at least 20 percent this week, leading losses in the Ibovespa index, which has lost 4.3 percent in the period. That pushed the stock market’s monthly drop to 7.7 percent, one of the worst performers among major global benchmarks. –Bloomberg

    The main entity representing truckers, ABCAM, said they haven’t changed their stance – and that they will call off protests only after federal diesel taxes are scrapped. 

    truckers say they want a definitive solution, saying they will end the protest only when a decision to eliminate federal diesel taxes is published in the official gazette.

    Local TV showed footage of federal forces being deployed over the night to some critical areas to help police remove trucks from highways.

    There were no reports of violence, but main roads remained blocked in the morning, including a key transport ring around Sao Paulo, the country’s largest city. –Yahoo

    Brazil’s auto production, which constitutes around 25% of industrial output, also ground to a halt on Friday. Authorities say that even after the strike ends, it will take several days to replenish vital supplies. 

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  • The Dummies Guide To The Russia Collusion Hoax: Who, What, Where, When, & Why

    Authored by Roger Kimball via Spectator USA,

    For your eyes only: A short history of Democrat-spy collusion

    How highly placed members of one administration mobilised the intelligence services to undermine their successors…

    Who, what, where, when, why? The desiderata school teachers drill into their charges trying to master effective writing skills apply also in the effort to understand that byzantine drama known to the world as the Trump-Russia-collusion investigation.

    Let’s start with “when.” When did it start? We know that the FBI opened its official investigation on 31 July 2016. An obscure, low-level volunteer to the Trump campaign called Carter Page was front and centre then. He’d been the FBI’s radar for a long time. Years before, it was known, the Russians had made some overtures to him but 1) they concluded that he was an “idiot” not worth recruiting and 2) he had actually aided the FBI in prosecuting at least two Russian spies.

    But we now know that the Trump-Russia investigation began before Carter Page. In December 2017, The New York Times excitedly reported in an article called “How the Russia Inquiry Began” that, contrary to their reporting during the previous year, it wasn’t Carter Page who precipitated the inquiry. It was someone called George Papadopoulous, an even more obscure and lower-level factotum than Carter Page. Back in May 2016, the twenty-something Papadopoulous had gotten outside a number of drinks with one Alexander Downer, an Australian diplomat in London and had let slip that “the Russians” had compromising information about Hillary Clinton. When Wikileaks began releasing emails hacked from the Democratic National Committee in June and July, news of the conversation between Downer and Papadopoulos was communicated to the FBI. Thus, according to the Times, the investigation was born.

    There were, however, a couple of tiny details that the Times omitted. One was that Downer, an avid Clinton supporter, had arranged for a $25 million donation from the Australian government to the Clinton Foundation. Twenty-five million of the crispest, Kemo Sabe. They also neglected say exactly how Papadopoulos met Alexander Downer.

    As it turns out, George Papadopoulos made several new friends in London. There was Joseph Mifsud, a Maltese professor living in London who has ties to British intelligence. It was Mifsud – who has since disappeared – who told Papadopoulos in March 2016 that the Kremlin had “dirt” on Hillary Clinton.

    Then there is Stefan Halper, an American-born Cambridge prof and Hillary supporter. Out of the blue, Halper reached out to Papadopoulos in September 2016. He invited him to meet in London and then offered Papadopoulos $3,000 to write a paper on an unrelated topic. He also pumped him about “Russian hacking.” “George, you know about hacking the emails from Russia, right?” Halper is said to have asked him. He also made sure Papadopoulos met for drinks with his assistant, a woman called Azra Turk, who flirted with him over the Chardonnay while pumping him about Russia.

    Halper also contacted Carter Page and Sam Clovis, Trump’s campaign co-chair. Is Stefan Halper, the “spy” on the Trump campaign, at the origin of the Trump-Russia meme?

    Not really. The real fons et origo is John Brennan, Director of the CIA under Obama. As Trump’s victories in the primaries piled up, Brennan convened a “working group” at CIA headquarters that included Peter Strzok, the disgraced FBI agent, and James Clapper, then Director of National Intelligence, in order to stymie Trump’s campaign.

    So much of this story still dwells in the tenebrous realm of redaction. But little by little the truth is emerging, a mosaic whose story is gradually taking shape as one piece after the next completes now this face, now another.

    There are details yet to come, but here is the bottom line, the irreducible minimum…

    A cabal of CIA and FBI operatives, including the Director of the CIA, John Brennan, along with other members of the intelligence “community,” prominently including James Clapper, Director of National Intelligence, and various members of the Obama administration, colluded to undermine Donald Trump’s campaign.

    Like almost everyone else, they assumed that Hillary Clinton was a shoo-in, so they were careless about covering their tracks.

    If Hillary had won, the department of Justice would have been her Department of Justice, John Brennan would still be head of the CIA, and the public would never have known about the spies, the set-ups, the skulduggery.

    But Hillary did not win. For the last 16 months, we’ve watched as that exiled cabal shifted its efforts from stopping Trump from winning to a desperate effort to destroy his Presidency. Thanks to the patient work of Devin Nunes, Chairman of the House Intelligence Committee, and a handful of GOP Senators, that effort is now disintegrating.

    What is being exposed is the biggest political scandal in the history of the United States: the effort by highly placed – exactly how highly placed we still do not know – members of one administration to mobilise the intelligence services and police power of the state to spy upon and destroy first the candidacy and then, when that didn’t work, the administration of a political rival.

    It is banana republic behaviour, but it looks now as if those responsible for this effort to undermine American democracy and repeal the results of a free, open, and democratic election will be exposed. Let’s hope that they are also held to account.

  • The Story Behind $17 Billion Booty Found In 300-Year-Old "Holy Grail Of Shipwrecks"

    Details have finally emerged surround a 2015 discovery of a 300-year-old Spanish galleon which went down after a battle with British ships off the coast of Cartagena, Columbia – considered the “holy grail of shipwrecks.” 

    Using an unmanned underwater vehicle called the REMUS 6000 – funded by the Dalio Foundation and operated by Woods Hole Oceanographic Institution (WHOI), researchers discovered the 62-gun, three-masted San José containing chests of gold, silver and emeralds minted in Peru – estimated to be worth up to $17 billion. 

    “The REMUS 6000 was the ideal tool for the job, since it’s capable of conducting long-duration missions over wide areas,” said WHOI engineer and expedition leader Mike Purcell.

    To confirm the identity of the San José, REMUS, celebrated for its ability to conduct long-duration missions over wide areas, descended near the suspected wreck, found about 2,000 feet underwater, capturing photos of a key distinguishing feature of the San José: bronze cannons engraved with dolphins, the WHOI said in its release. WHOI said it obtained authorization by Maritime Archaeology Consultants Switzerland AG and the government in Bogotá to release new details. –Marketwatch

    Discovered on Nov. 27, 2015, a raging debate ensued over the legal ownership of the Caribbean bounty. Because of this, details of the discovery was shrouded in secrecy until this week. Spain defended their ownership in the vessel, arguing that it is a warship with a State flag that carries sovereign immunity under the UN Convention on the Rights of the Sea – to which Columbia is not a party. 

    Spain also argues that the shipwreck is a maritime tomb to 570 Spanish nationals.

     

    Columbia, however, says that the San José belongs to them because it’s on their seabed. They plan to build a museum and conservation laboratory to preserve and publicly display the wreck’s contents, including cannons, ceramics, and other artifacts.

    The Colombian government has a long-standing disagreement with US-based salvage company Sea Search Armada (SSA) over who has the rightful claim over the treasure. A group now owned by SSA claims it located the wreck back in 1981. 

    According to the BBC, the SSA has been claiming billions for breach of contract from Colombia, but four years ago a US court decided that the galleon was the property of the Colombian state. Further, the wreck is reported to fall within the UN’s definition of an underwater cultural heritage site. Nonetheless, a CNN report suggests that the SSA may demand half of the value of the ship’s sunken treasure. –Gizmodo

    Upon its discovery, Columbian President Juan Manuel Santos tweeted “Great news! We have found the San Jose Galleon!” followerd by a press conference in which he said that the find “constitutes one of the greatest—if not the biggest, as some say—discoveries of submerged patrimony in the history of mankind.”

    The rescue operation to raise the booty, announced in March, will cost around $71 million USD. 

  • Tommy Robinson Arrested Outside UK Court, Jailed For 13 Months As Judge Orders Orwellian Media Blackout

    UK activist and English Defence Leage founder Tommy Robinson was arrested on Friday outside of Leeds Crown Court for reporting on a pedophile grooming trial. Within six hours of his arrest, Robinson was handed a 13 month prison term for violating a prior suspended sentence for a similar offense, while media outlets were banned from covering the incident by the court – with several removing reports which had already been published. 

    Footage shows Robinson, 35, being arrested while livestreaming to his Facebook page outside the courthouse. He can be heard shouting to a friend “Please, George, get me a solicitor, I’m on a suspended sentence, you see.”

    “A big police van with about seven police officers pulled up and arrested [Robinson] and told him to stop live streaming,” Robinson’s producer told RT (before their article (archived) was scrubbed from the internet). “They said it was incitement and a breach of the peace.

    “No peace has been breached – there were two other people there and he’s been perfectly quiet talking into his phone. [The police] said nothing about the court proceedings. It’s very strange.” 

    Disturbingly, the judge who sentenced Robinson, Geoffrey Marson QC, ordered an Orwellian media blackout – which resulted in several publications deleting their articles from the web covering Robinson’s arrest.  

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    Robinson was admonished last year by Judge Heather Norton for filming outside a gang rape case in Canterbury, who slapped him with a three month suspended sentence on the condition that he cease his coverage of the trials. 

    you should be under no illusions that if you commit any further offence of any kind, and that would include, I would have thought a further contempt of court by similar actions, then that sentence of three months would be activated -Judge Heather Norton

    “This is not about free speech, not about the freedom of the press, nor about legitimate journalism, and not about political correctness,” the judge told Robinson at the time.

    #FreeTommy

    In response to Robinson’s arrest, a large group of protesters gathered outside Downing Street – while the hashtag #FreeTommy has been used to coordinate a response, express outrage and share information about the situation. 

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    Robinson’s arrest has also sparked a free speech debate over social media, with  supporters and detractors alike standing up for the controversial activist’s right (or lack thereof) to express his opinion.

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    Pedophile grooming gangs

    A group of 29 defendants are being tried  for historical sex offences against children, split into three trials. Robinson was arrested at the second trial, while the first is ongoing.

    For more on the grooming gangs which have abused over 700 women and girls, click here.

    Meanwhile, enraged Britons have been harassing the defendants as they make their way to court in the ongoing trials. 

    Here is the full list of defendants via The Sun. 

    First Trial

    Amere Singh Dhaliwal, 34, from Huddersfield, West Yorks., is accused of 54 charges, including 21 charges of rape and 14 charges of trafficking with a view of sexual exploitation. Dhaliwal is accused of charges against eleven different girls from 2004 to 2011.

    Irfan Ahmed, 32, from Huddersfield, West Yorks., was charged with nine offences including making an indecent image of a child.

    Zahid Hassan, 28, from Huddersfield, West Yorks., was charged with 20 offences including six charges of raping a girl aged 13 or under.

    Mohammed Kammer, 32, from Huddersfield, West Yorks., was charged with two offences including rape of a girl under 15.

    Mohammed Aslam, 29, from Huddersfield, West Yorks., was charged with two offences including rape of a girl under 15.

    Abdul Rehman, 30, from Sheffield, South Yorks., was charged with seven offences including raping a girl under 15.

    Raj Singh Barsran, 32, from Huddersfield, West Yorks., was charged with three offences including sexual touching of a girl over 13.

    Nahman Mohammed, 31 from Huddersfield, West Yorks., was charged with three counts including trafficking a person for sexual exploitation.

    Zubair Ahmed, 30, from Huddersfield, West Yorks., was charged with two offences including raping a girl under the age 15.

    Hamzha Saleem, 37, from Old traddford, Gtr Mancs., was charged with three counts including human trafficking.

    Second Trial (Robinson’s arrest)

    Mansoor Akhtar, 25, from Huddersfield, West Yorks., was charged with three offences including attempted rape of a girl under the age of 13.

    Mohammed Asaf Akram, 31, from Huddersfield, West Yorks., was charged with 14 offences including four charges of raping a girl of thirteen or under and one charge of threatening to kill.

    Wiqas Mahmud, 36 from Huddersfield, West Yorks.., was charged with three offences of rape of a girl under 15.

    Nasarat Hussain, 28, from Huddersfield, West Yorks., was charged with five offences including rape of a girl under 15.

    Sajid Hussain, 32, from Huddersfield, West Yorks., was charged with five offences including rape of a girl under 15.

    Mohammed Irfraz, 28, from Huddersfield, West Yorks.., was charged with eight offences including false imprisonment.

    Faisal Nadeem, 30 from Huddersfield, West Yorks., was charged with three counts including raping a woman 16 or over.

    Mohammed Azeem, 31, from Bradford, West Yorks., was charged with three offences including rape of a girl under 15.

    Zulquarnian Dogar, 29, from Huddersfield, West Yorks., was charged with two offences including sexual touching of a female aged 13 or over.

    Manzoor Hassan, 37, from Huddersfield, West Yorks., was charged with four offences including inciting the sexual exploitation of a child aged between 13-17.

    Third trial set to last for six weeks.

    Niaz Ahmed, 53, from Huddersfield, West Yorks., was charged with three offences including sexual assault on a female.

    Mohammed Imran Ibrar, 32, from Huddersfield, West Yorks., was charged with four offences including arranging the commission of a child sex offence.

    Asif Bashir, 32, from Huddersfield, West Yorks., was charged with five offences, including three counts of raping a woman 16 or over.

    Everton la Bastide, 50, from Huddersfield, West Yorks., was charged with two offences including sexual touching a girl of 13 or over.

    Saqib Raheel, 30, from Dudley was charged with two offences including trafficking for sexual exploitation.

    Usman Khalid, 29, from Huddersfield, West Yorks., was charged with three offences including assaulting a girl under 13.

    Aleem Javaid, 27, from Huddersfield, West Yorks., was charged with two offences including supply of a class B drug.

    Mrs Naveeda Habib, 38, from Huddersfield, West Yorks., was charged on one count of neglect of a child.

    Mrs Shahnaz Malik, 55 from Huddersfield, West Yorks., was charged with one count of neglecting a child.

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  • Californians Are Willing To Repeal The Gas Tax, But…

    Authored by Jazz Shaw via HotAir.com,

    A massive new gas tax passed by the California state legislature appeared to finally be a bridge too far for most residents of the state.

    A movement began to repeal the tax by referendum and a petition to do so quickly amassed far more than the needed number of signatures. Now, a new poll indicates that support for the repeal measure has reached majority numbers. But there’s more going on here than just the removal of a set of taxes and fees.

    As a new poll found a majority of California voters want to repeal increases to the state’s gas tax and vehicle fees, Gov. Jerry Brown has begun campaigning to preserve them, arguing the sacrifice is needed to fix long-neglected roads and bridges and improve mass transit.

    Repeal of the higher taxes and fees was supported by 51% of registered voters in the state, according to a new USC Dornsife/Los Angeles Times statewide poll.

    The survey found 38% of registered voters supported keeping the higher taxes, 9% hadn’t heard enough to say either way and 2% said they wouldn’t vote on the measure.

    The tax package looks like it’s about to be taken off life support, but Republicans in the state hope that the referendum delivers for them in another way. With some marginal House seats being considered in play this November, campaigning on support for the repeal measure should, in theory, boost GOP voter turnout, possibly turning back some of the “blue wave” that Democrats are looking for.

    It’s also left the Governor in the unenviable position of having to defend taxing his constituents more. He fumbled the first attempt at that when he resorted to name calling in an apparent fit of pique. At one news conference, he was quoted as saying,

    “The test of America’s strength is whether we defeat this stupid repeal measure, which is nothing more than a Republican stunt to get a few of their losers returned to Congress.”

    “Stupid repeal measure?” Does the governor read the news anymore? He just called more than half the people in his state “stupid.” Let’s see how well that plays five months from now.

    Some of my hopes for California were dashed, however, when another set of poll numbers came out. For a time, I’d actually begun to think that Californians were waking up and realizing that the Democrats they keep electing were taxing them to death and perhaps a new course needed to be followed. Sadly, while they oppose the gas tax, those same voters seem to be fine with jacking up taxes on the businesses who employ them.

    A majority of California voters back a potential 2020 ballot measure that would increase property taxes on businesses, according to a new USC Dornsife/Los Angeles Times poll.

    Of the 691 registered voters surveyed, 54% said they supported a measure that would ease property tax protections established by the landmark 1978 ballot measure Proposition 13. Under the proposed 2020 initiative, local governments and schools could tax larger commercial and industrial properties based on their market values rather than the values based on when the properties were purchased, resulting in as much as $10 billion annually in new revenue.

    The economy in California works out fabulously for celebrities and the mega-wealthy. But for most rank and file workers, it’s virtually impossible to afford a house anywhere in the state that’s even marginally habitable. Businesses and workers are already fleeing the state in the more expensive areas, yet residents still seem to be fine with the idea of taxing “somebody else” as long as their gas prices don’t go up further.

    There’s an old saying credited to Russel B. Long, which goes, “Don’t tax you, don’t tax me, tax that fellow behind the tree!” There’s some wisdom there which Californians should look into.

  • Top Restructuring Banker: "We're All Feeling Like Where We Were Back In 2007"

    There is a group of bankers for whom “better” means “worse” for everyone else: we are talking, of course, about restructuring bankers who advising companies with massive debt veering toward bankruptcy, or once in it, how to exit from the clutches of Chapter 11, and who – like the IMF, whose chief Christine Lagarde recently said “When The World Goes Downhill, We Thrive” – flourish during financial chaos and mass defaults.

    Which is to say that the past decade has not been exactly friendly to the world’s restructuring bankers, who with the exception of two bursts of activity, the oil collapse-driven E&P bust in 2015 and the bursting of the retail “bricks and mortar” bubble in 2017, have been generally far less busy than usual, largely as a result of abnormally low rates which have allowed most companies to survive as “zombies”, thriving on the ultra low interest expense.

    However, as Moody’s warned yesterday, and as the IMF cautioned a year ago, this period of artificial peace and stability is ending, as rates rise and as a avalanche of junk bond debt defaults. And judging by their recent public comments, restructuring bankers have rarely been more exited about the future.

    Take Ken Moelis, who last month was pressed about his rosy outlook for his firm’s restructuring business, describing “meaningful activity” for the bank’s restructuring group.

    “Your comments were surprisingly positive,” said JPMorgan’s Ken Worthington, quoted by Business Insider. “Is this sort of steady state for you in a lousy environment? Can things only get better from here?”

    Moelis’ response: “Look, it could get worse. I guess nobody could default. But I think between 1% and 0% defaults and 1% and 5% defaults, I would bet we hit 5% before we hit 0%.”

    He is right, because as we showed yesterday in this chart from Credit Suisse, after languishing around 1%-2% for years, default rates have jumped the most in 5 years, and are now “ticking higher”

    Moelis wasn’t alone in his pessimism: in March, JPMorgan investment-banking head Daniel Pinto said that a 40% correction, triggered by inflation and rising interest rates, could be looming on the horizon.

    These are not isolated cases where a gloomy Cassandra has escaped from the asylum: already the biggest money managers are positioning for a major economic downturn according to recent research from Bank of America. And while nobody can predict the timing of the next collapse, Wall Street’s top restructuring bankers have one message: it’s coming, and it’s not too far off.

    However, the most dire warning to date came from Bill Derrough, the former head of restructuring at Jefferies and the current co-head of recap and restructuring at Moelis: “I do think we’re all feeling like where we were back in 2007,” he told Business Insider: “There was sort of a smell in the air; there were some crazy deals getting done. You just knew it was a matter of time.”

    What he is referring to is not just the overall level of exuberance, but the lunacy taking place in the bond market, where CLOs are being created at a record pace, where CCC-rated junk bonds can’t be sold fast enough, and where the a yield-starved generation of investors who have never seen a fair and efficient market without Fed backstops, means that the coming bond-driven crash wil be spectacular.

    “Even if there is not a recession or credit correction, with the sheer volume of issuance there are going to be defaults that take place,” said Neil Augustine, cohead of the restructuring practice at Greenhill & Co.

    The dynamic is familiar: since 2009, the level of global nonfinancial junk-rated companies has soared by 58% representing $3.7 trillion in outstanding debt, the highest ever, with 40%, or $2 trillion, rated B1 or lower. Putting this in contest, since 2009, US corporate debt has increased by 49%, hitting a record total of $8.8 trillion, much of that debt used to fund stock repurchases.  As a percentage of GDP, corporate debt is at a level which on ever prior occasion, a financial crisis has followed.

    The recent glut of debt is almost entirely attributable to the artificially low interest-rate environment imposed by the Federal Reserve and its central bank peers following the crisis. Many companies took advantage and refinanced their debt before 2015 when a large swath was set to mature, kicking the can several years down the road. 

    But going forward “there’s going to be refinancing at significantly higher rates,” said Steve Zelin, head of the restructuring in the Americas at PJT Partners.

    And as the IMF first warned last April, refinancing at higher rates will further shrink the margin of error for troubled companies, as they’ll have to dedicate additional cash flow to cover more expensive interest payments.

    “When you have highly leveraged companies and even a modest rise in interest rates, that can result in an increase in restructuring activity,” said Irwin Gold, executive chairman at Houlihan Lokey and cofounder of the firm’s restructuring group.

    So with a perfect debt storm coming our way, many restructuring firms have been quietly hiring new employees to be ready when, not if, the economy takes a turn for the worse.

    “The restructuring business is a good business during normal times and an excellent business during a recessionary environment,” Augustine said. “Ultimately, when a recession or credit correction does happen, there will be a massive amount of work to do on the restructuring side.” Here are some additional details on recent banker moves from Business Insider:

    Greenhill hired Augustine from Rothschild in March to cohead its restructuring practice. The firm also hired George Mack from Barclays last summer to cohead restructuring. The duo, along with Greenhill vet and fellow cohead Eric Mendelsohn, are building out the firm’s team from a six-person operation to 25 bankers.

    Evercore Partners in May hired Gregory Berube, formerly the head of Americas restructuring at Goldman Sachs, as a senior managing director. The firm also poached Roopesh Shah, formerly the chief of Goldman Sachs’ restructuring business, to join its restructuring business in early 2017.

    “It feels awfully toppy, so people are looking around and saying, ‘If I need to build a business, we need to go out and hire some talent,'” one headhunter with restructuring expertise told Business Insider.

    “In our world, people are just anticipating that it’s coming. People are trying to position their teams to be ready for it,” Derrough said. “That was the lesson from last cycle: Better to invest early and have a cohesive team that can do the work right away and maybe be a little bit overstaffed early, so that you can execute for your clients when the music ultimately stops.”

    Of course, if the IMF is right (for once), Derrough and his peers will soon see a windfall unlike anything before: last April, the International Monetary Fund predicted that some 20%, or $3.9 trillion, of the total global corporate debt is in danger of defaulting once rates rise.

    Although if and when that day comes, perhaps a better question is whether companies will be doing debt-for-equity swaps, or fast forward straight to debt-for-lead-gold-and canned food…

  • As Russia's Gold Hoard Soars, Putin Warns "US Sanctions Hurt Trust In Dollar As Reserve Currency"

    Despite his absence from Vladimir Putin’s annual economic showcase – which included such US allied luminaries as Japanese Prime Minister Shinzo Abe, French President Emmanuel Macron, China’s Vice President Wang Qishan and IMF chief Christine Lagarde – the conversation kept coming back to President Trump.

    Led by an unusually outspoken Putin, Macron – who seemed more enamored with Putin than the rest, agreed with the Russian president’s concerns over the erosion of trust and the specter of a global crisis brought on by Washington’s disruptions.

    “The free market and fair competition are being squeezed by confiscations, restrictions, sanctions,” Putin said.

    “There are various terms but the meaning is the same — they’ve become an official part of the trade policy of certain countries.”

    The “spiral” of U.S. penalties is targeting “an ever larger number of countries and companies,” undermining “the current world order,” he said.

    Macron replied: “I fully share your point of view.”

    Such warnings only confirm Mr Putin’s world view. Without mentioning the US, he complained that the multilateral economic world order was being “crushed” by a proliferation of exceptions, restrictions and sanctions.

    The “darkest cloud” on the economic horizon is the “determination of some to actually rock the system,” Lagarde said, prompting Wang, a new point-man for Chinese foreign policy, to agree.

    “Politicizing economic and trade issues, and brandishing economic sanctions, are bound to damage the trust of others,” he said.

    Putin also expressed frustration at having little contact with Trump and faulted the investigation into whether there was collusion between Trump’s campaign and Russia and whether Russia tried to interfere with the 2016 U.S. election.

    “We are hostages to this internal strife in the United States,” Putin said. “I hope that it will end some day and the objective need for the development of Russian-American relationships will prevail.”

    As Bloomberg reports, the panel had its prickly moments. After Putin suggested that Europe depended on the U.S. for its security, and told Macron there was “no need to worry” because Russia would help, the French president shot back:

    “I’m not afraid, because France has an army that knows how to protect itself.”

    However, the most ominous and direct messages were from Putin himself about changes to the unipolar order.

    In his opening statement at the plenary session, Putin says the global economic order is being undermined and that breaking the rules is becoming the rule of the game.

    Coming a day after Russia’s Finance Minister Anton Siluanov said at the St. Petersburg International Economic Forum that settlements in US currency could be dropped by Russia in favor of the euro. 

    “As we see, restrictions imposed by the American partners are of an extraterritorial nature. The possibility of switching from the US dollar to the euro in settlements depends on Europe’s stance toward Washington’s position,” said Siluanov, who is also Russia’s first deputy prime minister.

    “If our European partners declare their position unequivocally, we could definitely see a way to use the European common currency for financial settlements, such as payments for goods and services, which today are often subject to restrictions,” Siluanov added, dangling the bait in front of Merkel and Macron.

    The global economy is facing a threat of a spiraling protectionist measures that can lead to a devastating crisis, Vladimir Putin warned. Nations must find a way to prevent this and establish rules on how the economy should work.

    The Russian president spoke out against the growing trend of using unilateral restrictions to achieve economic advantage, as he addressed guests of the St. Petersburg International Economic Forum (SPIEF) on Friday.

    “The system of multilateral cooperation, which took years to build, is no longer allowed to evolve. It is being broken in a very crude way. Breaking the rules is becoming the new rule,” he said.

    Putin sharply criticized the sanctions, saying they signal “not just erosion but the dismantling of a system of multilateral cooperation that took decades to build.”

    Putin called for a change of course, for free trade to be defended, and for rules-based regulation of the global economy, which would alleviate the chaos resulting from the rapid technological transformations arising from the development of digital technology.

    “The disregard for existing norms and a loss of trust may combine with the unpredictability and turbulence of the colossal change. These factors may lead to a systemic crisis, which the world has not seen yet,” he said.

    Simply put, Putin concluded:

    “US sanctions hurt trust in the US dollar as the world’s reserve currency.”

    All of which appears to confirm many conspiracy-theorist’s reasoning for why Russia is stockpiling gold faster than any other nation on earth…

    Feels good, ha Vlad?

     

     

     

     

  • These Are The Cheapest Crash Hedges Right Now

    With the “smart” money exiting the stock market in droves, yield curves collapsing, extreme speculative positioning in bonds, and a dramatically diverging economic reality from market market narratives, the possibility of a crash – Fed triggered or not – is rising.

    What do ‘they’ know?

    And with everyone on the same side of another boat…

     

    So the question is – what’s the cheapest way to hedge against a crash scenario?

    Bank of America’s Jason Galazidis has some answers…

    Ranked by the average, the screen below shows that the hedges which are most underpricing historical drawdowns are:

    Gold calls, US HY Credit hedges and EUR 10y receivers

    And so – once again – the precious metal regains ‘most-favored-nation’ status as the world’s emerging markets collapse and economic reality washes ashore on the banks of the river-of-excess-debt…

    Since the middle of January, gold implied vol has been notably, systemically lower than stocks…

    And European equity vol has started to normalize back to its premium to US equity vol…

     

    Cross asset risk is once more in benign territory relative to history as vols and credit spreads are all in their 1st 11y quartile…

     

    Additionally, 12M cross-asset-class correlation has continued its climb since the Feb-18 equity-led sell-off, now reaching 5y highs…

    Historically there have been 3 distinct cross asset correlation regimes since 1995. Interestingly, we see a broadly upward trend since Oct-03, well before the Lehman bankruptcy in Sep-08. This is related to the liquidity driven crush in asset risk-premia that helped drive investment leverage higher.  Long-term correlation established a new regime since 3Q13, similar to the ’03 to ‘08 correlation environment.

    And these are the two-month-forward historical stress peaks, compared to current levels, if that systemic crash should occur…

    The chart illustrates why it is useful to consider the relative pricing of options across asset classes to hedge against tail events: option markets often underestimate the severity of market shocks, and to different degrees. In 2008, currency and equity vols were the most optimistic ahead of the Lehman crisis and the most surprised after (rose to the highest levels).

  • Ron Paul: On War, Gold, & My Years In Congress

    Via The Mises Institute,

    JEFF DEIST: What makes you optimistic, what makes you pessimistic about what you see in the US?

    RON PAUL: Well, if I look at the big picture including a long span of time, I would say conditions aren’t that bad, even though I often talk about all the bad things I anticipate and how it could get worse in terms of the economy and foreign policy.

    When you think about it, I was born in 1935, in the middle of the Depression. I remember my early life. I remember when I was 3 years old and 5 years old and the Depression lasted through World War II and the conditions were such as I remember very clearly, but it wasn’t a big deal for me even though we lived in close quarters and we didn’t have a lot of shoes and were just skimping by.

    So, we went through a Depression and World War II. Those were pretty tough times and since that time — since the war issue’s always been a big issue with me — I remember the tragedies of World War II. We had relatives in Germany, so it always caught my attention. Then we had the Korean War. I could remember my mother saying, “another war this soon?” We just got over one, so she was negative on that and then we had the Vietnam War and I knew that I probably would be drafted and that was one of the reasons that helped me move toward medicine.

    So, those were pretty bad times. Think of the people that were dying over those first 30 or 40 years. Things weren’t great economically either. In America, we were not even allowed to own gold.

    Those were conditions that existed that changed for the better to some degree. Philosophically, I think, we’re still on the wrong track overall, although some things have improved. Once again, we’re able to own gold. The United States government and I pushed it along when I was in Congress to mint gold coins again and talk about monetary policy.

    Philosophically, we are making progress in some areas, though, and I give a lot of credit to the institutions that do this, like the Mises Institute and FEE. And of course, I want to participate in changing foreign policy and we keep working on that through the Ron Paul Institute.

    But, on the downside of all this, I see we’re on a disastrous course even though the official economic indicators look great and wonderful. Everybody’s practically euphoric and Trump is a good cheerleader. But, there is a lot of weakness behind the numbers, and we’re engaging in self-deception and unsupported hopefulness that things will be all good, there will be no inflation or high unemployment, and there’ll be no major war. I think when I look at the seeds that have been sown, the future looks rather bleak in many ways, even compared to what it was like as we finished World War II and Vietnam.

    We’re in a mess partly because our major universities are still very Marxist-oriented and they’re very anti-liberty and therefore, I think for people who care about liberty, we have a big job ahead of us.

    JD: You talk about this in your book, Swords into Ploughshares. Is there a particular moment or recollection from your childhood during the Great Depression, or World War II, that started you on the path to being liberty-minded?

    RP: Not at that young age. I think I had a natural instinct — and I claim everybody has a natural instinct — to be an individual. I think we express that when we are 2 years old and when we are 4 years old, when we’re teenagers and it’s always a struggle of being independent-minded and minding our own business and taking care of ourselves. And then, we have that beaten out of us. Of course, discipline is very necessary and good. But it depends on where it’s coming from. If it’s coming from some wise parenting, I think this is very, very good.

    But, there was never one moment I started down that path of being liberty-minded. I think, more or less, it was an evolution. Back then I’d read newspapers and listened to the radio, listened to my dad talking about the war issues and going to school and it was a mixed bag. And then, I guess the serious introduction came probably in the early 1960s. I got interested in reading Austrian economics. I read almost everything that Ayn Rand ever wrote and that’s when I found Leonard Read and got to know him. It seems like when Goldwater was running — that would have been ’64 — I had already been thinking about it. If you read everything Goldwater was talking about back then, he would throw out some names. So, somewhere along the way, I came across the name Hayek because he was known because of The Road to Serfdom. So, I was inquisitive enough to look into it.

    By the way, when I talk to college students today, I say the most important thing you can leave this place with is being inquisitive, checking out, finding out, and ask the question and seek the truth and do your best to be truthful to yourself and then come up with these answers. I am fascinated, that on the campaign trail in the last 10–15 years, where people would listen and come up to me and they would say, “I get it. It’s just common sense.” They’d put the whole picture together and they seemed to have sort of a moment where a light bulb goes on.

    JD: Part of this evolution affected your decision to be a doctor, didn’t it? Deciding you wanted to help people. You saw a world full of hurt.

    RP: I had an exceptionally good male teacher that taught biology and I got fascinated with that and got an A. So, when I went to college, I sort of leaned in the direction of science. I already felt comfortable with biology and the chemistry teachers and physics teachers weren’t as good. So I majored in biology, so that sort of set the stage, but even up until my third year in college, I was uncertain. But by the time I was finished in college, I had made a decision that’s what I wanted to do and fortunately, I was able to do that. I considered myself very fortunate that I was able, over my lifetime, to be able to do medicine, to a large degree and stuck with that a lot more than people realize as well as getting involved in the issues. People say, “when did you get involved in politics?” I say I never did. “When did you decide to go into politics?” I never did. But, I wanted to talk about the issues that were important to me and the vehicle was politics because I wasn’t an economics professor. I wasn’t writing great books and things like that, I was more inspired to try to convince other people of a different way of doing things. And I think I picked up some of the wisdom on how to do that from Leonard Read because he had some special ideas on how you converted people. Yet, I ended up talking, and being impressed and amazed that I could get 5,000 or 10,000 people out on a college campus, but being a member of Congress was what I used that one thing to do and that is to change people’s minds.

    JD: I know you’ve written about it, but talk briefly about your involuntary time, of a sort, in the Air Force during the 1960s.

    RP: Right. I always assumed I would be drafted. I thought being a doctor was a better way to go, because I just dreaded the thought of people just shooting at each other and killing each other. In October of ’62, I was almost finished with my second year of residency, and during the crisis, I got a draft notice. Fortunately I was able to finish out the year, but I went into the Air Force in January of ’63 and was stationed at Kelly in San Antonio and that’s how we originally got to Texas. But, back then, there were a few people resisting the draft. There was a doctor that was in the news and I sort of looked at that and I paid attention, but I didn’t say, “that’s what I ought to be doing.” But resistance to the war grew, and as time went on I sort of admired what boxer Mohammad Ali did, to give up his career in a way for three years, because he was arrested and prosecuted for resisting the draft. That, to me, was very impressive. I was disturbed by that, but I expected it. That’s what governments do to you.

    I was disturbed that my medical training was going to be messed up. But, I was pretty stoic about it and I liked the idea of flying. I remember going through flight medical school. It was not a big education, it was 3 months schooling, but I remember it was in the early 60s, they were just talking about the space program. I said, in my mind, I wonder if I ever could be the first doctor that could go into space. That technology fascinated me and of course, that wasn’t to be, but I just made a decision that I would make the best of it. During the Air Force period, I had a lot more time to read and that’s when the Randians were very active and it was at that time, I subscribed to The Objectivist Newsletter and remember specifically reading “Gold and Economic Freedom” by Alan Greenspan, which I kept a copy of all those years. That’s the activity I was involved with. I’m not a Randian, and I’m not an Objectivist. I have my critique of that, but it was sort of inspiring reading.

    Even today, I don’t read hardly any novels, but I read hers because they were sort of inspirational and yet, she forced me to sort things out because she was so negative on Christianity and generosity, at least she came across that way with her attack on altruism and compared it to communism and that didn’t make sense to me. I had to figure that out, that there was a difference, that they weren’t identical.

    But, so I had more time off while in the Air Force and enjoyed it. I learned how to fly an airplane and got my pilot’s license, but had to travel around the world frequently as part of my duty. I went to the Far East on a couple trips and I went to the Middle East and every place from Spain, Italy, Turkey, Ethiopia, Pakistan, the whole works. Iran, I was in, I don’t think I was in Iraq. In Iran, I had been there in Tehran, but that was back when we owned it, with the Shah.

    I referenced those trips over the years because they became so significant in my activity in foreign policy. I especially remember how we weren’t allowed to go into Afghanistan. We were in Pakistan and we went up to Peshawar, which was not too far from the Khyber Pass, which was historic and remains historic. It was right on the border and it turned out that was the area where that whole Bin Laden episode happened. And I can visualize that place very, very well as I was driving with the military people up in a truck, to visit the border. I can remember the captain that was with us in the truck, who had been there before and he said, “Ron, do you see that place up there?” It was a place of totally bare and rocky mountains. He said, “there are thousands of people that live up there. They are tribal and they’ve been there for a long, long time and they’ve never been conquered.” And he gave me a little history lesson and so, once we started thinking about this, in the foreign policy, I was able to visualize.

    So, my military experience turned out to have some value.

    JD: After the Air Force you were back in South Texas. You now have several kids. You’re reading Austrian economics, getting more and more involved in your thinking. In the early 70s, you go to the University of Houston and see Ludwig von Mises, only a year or two before he died.

    RP: I think it was his last lecture tour. We saw a little clip in the paper — very, very small — in the Houston Chronicle and it said he would be a speaker at the University of Houston. There was only one other person I knew in the whole town that knew who Mises was and that was Dr. Henry May and so, I called him, I said, “Henry, Mises is coming to town. Why don’t we go up and hear him?” And it was a major decision for us because we had to drive about 50 or 60 miles and find where he was giving this lecture. At the same time, we both had office hours, so we had to get coverage, for somebody to come in and take care of our patients because it would take us the afternoon to do this. So, we went up and his lecture was on socialism. I sort of read the book and knew a little bit about it. It was just the experience of hearing him lecture. He had a German accent with a lot of lisping, whistling. He spoke English, of course, but there was a strong accent, but it still was an experience. The venue, it was a room, probably a classroom that might have held 40 to 50 students, maybe more and they had to bring extra chairs in and that room was packed. We got there a little late and we stood at the door so we could at least see him for the experience. I don’t know whether you ever heard the other part of the story.

    JD: Dr. Michael Keller.

    RP: Do you know the story?

    JD: Our friend, Dr. Keller, was responsible for having the event there as a young member of UH student council.

    RP: One time we were talking many, many years later, to Keller and I told him this story. He said, “Guess what? I was the one that got Mises to come.” It was probably decades later that we crossed paths and that’s how one person, doing something — like bringing Mises in — can make changes and I found that fascinating.

    JD: So, when you ultimately decided to run for Congress, the first time around in the Houston area, I wonder if people understand how beneficial it was that you were known as a medical doctor and an OB — it was a political asset for you in running for Congress.

    RP: Yes, it was, as a matter of fact. We used it in our advertisements and our media person did an ad which was just, the lights coming on at my house. It was dark and I go out and get in the car and drive off and they show me going off and then me coming back home in the middle of the night. I got up and went and delivered a baby. Matter of fact, [Congressman and medical doctor] Michael Burgess was a medical student back then and after we got to know each other he said, “I saw your ads. That’s when I went into OBGYN. The ads were so impressive.” It had nothing to do with anything foreign policy or gold standard or anything else. It was just that I was an OB doctor and it was image making. When he told me that story, I said, “It’s too bad you just went into OB. I thought you’d become a libertarian.” But, he probably wouldn’t mind me saying that.

    JD: Carol was a little astonished when you won? It changed your life, not always in great ways, in terms of family.

    RP: Well, she wasn’t astonished. I was probably more astonished. It’s when I told her I was going to run. She said, it was risky, dangerous because you might win. I said no, I can’t possibly because I wasn’t involved in that. I was trying to get rid of Santa Claus and you don’t win doing that. She said, yeah, but you’re going to tell them the truth and they’re going to like that and they’re going to vote you in. So, yes, we had some adjustments to do. And that was one reason why after I had four terms, I came back to medicine for 12 years.

    JD: One of the great things that came out of your first stint in Congress was your minority report, with Lewis Lehrman on The Case for Gold. You were part of the Minority Commission appointed by Ronald Reagan. Reagan is someone you saw through maybe more than a lot of conservatives did.

    RP: Oh, yeah. Reagan was a nice guy and I think he believed in some good things, but he also was able to rationalize a lot of things. Deficit spending, big government, militarism. I didn’t like what he did in Libya, bombing Libya.

    Also, he really had less to do with the gold commission than it sounds because it was passed under Carter the year before Reagan was in. So when Reagan was elected and it came up, it looked like they were just going to ignore it. We had to make sure that they did it and my involvement came about, interestingly, because I had talked about gold.

    The most important outcome of that whole thing was that we legalized private ownership of gold again for the first time since the 1930s. The legislation was brought up under the IMF bill in 1983 and Jesse Helms and I sort of worked it together. But he was ahead of me on having it done. I think he was getting ready to do it in the Senate and they came to me and I was able to introduce it in the House.

    The bill’s passage was a significant event, but that was a reflection of what was going on in ’79 and ’80. I mean, we went from gold not being owned by Americans and fixed at $35 an ounce at Bretton Woods, which was a disaster. It collapsed and then we had a decade of massive inflation and 15 percent interest rates then 21 percent and people were very, very concerned about the dollar and so, the purpose was to study the role of gold in the monetary system, domestic and international.

    We had our first meeting and it was held in secret and [Donald] Regan was the chairman. He was Treasurer and he said, “we have to keep this secret because we don’t want to mess up the gold markets and all.” And guess who came to our rescue? Several people did, but [syndicated columnist and journalist] Bob Novak did. Novak was a gold guy and he started writing about it and he got enough people to pester them and then they turned the commission’s documents over. Few people in Washington wanted an open discussion.

    JD: A lot of people may not know the story about President Reagan calling you to vote for funding for a bomber program. Tough call for a young congressman.

    RP: Yeah, I was in the House restaurant and I think Carol was with me because usually when we had someone come from home, a guest, we’d go there. So, they came over and said, the president’s on the phone. I went to take the call and matter of fact, over the years, he did that I think twice, but this was the one on the B-1 bomber, that was controversial and he asked me — I was very, very polite and he was very polite — and I said, well I’m sorry, Mr. President because you know, I campaigned against that and I said I don’t think I can break my word. He said, okay, I understand. There wasn’t any badgering or anything like that, but then I went back and I told Carol.

    JD: That’s a great story. He was a little more gentlemanly than Tom DeLay.

    RP: DeLay was something else. He’s being rehabilitated.

    JD: Yes. Do you have any thoughts on running against Phil Gramm in 1984 for US Senate in Texas?

    RP: I was looking for a graceful way out of Congress and the Senate run was it because I did have a lot of supporters then and I didn’t want to insult them by just quitting. It was very, very clear that the establishment Republicans didn’t want me and they ganged up real fast to support Gramm. I don’t know of any other way that I could have done it, but it was sort of my desire to get home because in spite of all the stories you hear about Congressmen, back then I was probably making $40,000 or $50,000 a year and I had kids in school and it was not financially easy to go back and forth and have a couple homes and get kids through college. I decided that if I was going to go back to Congress, I had certain rules that I had. I was not going to have any kids still in school and I wouldn’t owe any money. I’d have my house and all my properties paid off and then I could be more relaxed in going back and not have to worry about the finances.

    JD: So, when you decide to run again in 1996, people might not know how arrayed against you the GOP was. Then Governor George W. Bush of Texas and his man, Karl Rove, were not fans, and actually Newt Gingrich as speaker had the Democrats switch parties to run against you. So they didn’t want you back.

    RP: They worked very, very hard. Matter of fact, that race is probably the most fascinating that I was involved in. It’s been written up in detail because when I decided I was going to run, I went and talked to the Republican delegation and I said, “I want to run.” I want to get another Republican seat for Texas because Greg Laughlan was the sitting Democrat in the 14th district where I lived.

    I said I could get the seat. But, what shocked me is I didn’t know how quickly I could change it to a Republican seat a month later. With the backing of the Republican establishment, Laughlan became a Republican. He was on the Ways and Means Committee and the GOP promised him a million dollars and Newt Gingrich came on and he supported him. He got 56 — maybe, a large number, I think it was around 56 — other members of Congress to cough up and donate to his campaign and both Bushes, Senior and Junior, supported him. They didn’t want me in Congress.

    But, it all backfired. We were tipped off at times when they were trying to bring somebody in to tell local voters to vote for Laughlan. I think it was somebody from the Reagan administration that they sent in. I can’t think of his name right now but he had been in the cabinet. We would know that he was coming in and then we had our press release ready the day before he arrived. The thing that we could use on this was, “why are they sending people from Washington to tell people in Texas how to vote?” And that was a powerful message.

    And also, I knew for sure that the reason that race was so interesting was that they would use the drug issue. I was very clear about the War on Drugs and how could anybody be against the War on Drugs in a Bible Belt conservative Republican district in Texas? You can’t be elected like that.

    So lo and behold, the Republican Party spent a million dollars or more, which was a lot of money then, and they did the most vicious ugly ads against me claiming that I’m giving drugs to kids and children, drug dealers and all this trash. And it didn’t work. I think most people didn’t believe it could possibly be true because they knew me more as a doctor taking care of and delivering babies. In fact, we answered it with an ad showing me delivering a baby. So, we had to combat this image. I ended up winning the primary.

    But then the Democrats did the same thing, used the drug issue and I finally concluded that I thought I was absolutely alone, but I think the people are way ahead of Congress because there probably were a lot of families that had been touched by somebody because they smoked a marijuana cigarette and got thrown in prison. It was horrible. It still is bad and we’re seeing this today. I think the people either didn’t believe it or they weren’t going to hold it against me or they think the drug war was bad and I think time has proven that that was a good assessment, even though now we have an administration that’s trying to go backward.

    JD: Well, when you come back to Congress, your second stint from 1997 until 2012, was marked by really two things that stick out. One is that you were strongly against the Iraq and Afghanistan wars and you were involved in promoting noninterventionism. The other thing is that you were involved in monetary policy going back and forth with first Alan Greenspan and later Ben Bernanke. Give us your overriding thoughts about your second go in Congress.

    RP: It was quite a bit different than the first time I ran. There was more attention and especially from 2008 on, from the presidential election in ’08 and ’12. It was just astounding and it was the issues that I liked to talk about, such as civil liberty issues.

    I remember that I was totally shocked when I arrived at the University of Michigan, it was after a debate we had in Detroit, and there was a group of young people who had waited because I was late. But, we came over and that’s where they started shouting “end the Fed” and that’s where I remembered them doing that. I didn’t tell people. I didn’t have cards, hold cards up or say let’s end the Fed. It was spontaneous, so I knew something was going on, where people wanted to hear this message.

    The other big issue was the NDAA [National Defense Authorization Act]. College kids started talking about that or bringing it up to me even before I was hitting hard about it. The main concern was the authority to arrest Americans and hold Americans without due process which has continued.

    Those were the issues I like to talk about and of course, one of my biggest events — might have been the biggest one — was at the Berkeley campus. Things were going along and we got more attention on the Federal Reserve and people, even today, I think have a much healthier attitude about the Federal Reserve. I remember at the time seeing a poll conducted by a television station asking whose fault the recession was. I think that 66 percent agreed it was the Fed’s fault and I thought, “wow.” And this wasn’t on your website or my website. This was on the CNBC website. And I thought, well, something interesting is going on. They’re not going to get away with what they’ve gotten away with for a long time because we’re going to have another crisis and the media will say it’s the Fed’s fault.

    JD: You knew Alan Greenspan a little bit and he understood gold and he understood Austrian economics. He’s a brilliant man.

    RP: We had a little bit of fun at times and I had visited with him after some hearings about Murray Rothbard and different things because he knew Murray from the Rand group. I think the most fascinating little incident was because I remember his article in The Objectivist Newsletter and he was coming to one of our hearings and we were able to go and have a one-on-one, sit down and get a picture and say a few words. And not everybody did it, but I was interested in it. That’s generally not my thing, but for Greenspan, I thought, I might as well take advantage of this. I had the original green pamphlet, which was The Objectivist Newsletter and it was in 1966 and it was when Greenspan had his article first published. I said, “do you recognize this?” He knew what it was. “What I’d like you to do is sign this article for me.” So, he got his pen out and he signed this. I said, do  you want to put a disclaimer on it? And he said, “I just read that recently and I still support all those views.” What am I going to make of all that?

    I’ve tried to get him on the Liberty Report, can’t get him on. I thought I could have some fun.

    JD: Maybe if you pay his $200,000 speaking fee.

    RP: Yes, probably.

    JD: I recall you also had a breakfast with Ben Bernanke when he was Fed Chair. How did that go? Was that polite or was it frosty?

    RP: It was polite and boring, in a way.

    JD: He wasn’t the ideologue that Greenspan was.

    RP: It might have been me not being aggressive enough or something. But, I’d have a much easier conversation with Volcker. Volcker, I got to know a lot better than I knew Bernanke and in the early 80s, there was a thing called the Monetary Control Act and there was a major part of it which was opening up the door for the Fed to monetize anything they want, especially foreign bonds. So, I complained about it and complained about it in my little way at the conference and Volcker invited me over. He said, “I’d like you to come over and have breakfast and we’ll talk about it some more.” But, it was sort of an academic thing, the way it was. It wasn’t like, “I’m going to straighten you out.” That wasn’t his attitude. So, this had to have been in ’79, most likely or ’80.

    JD: Mr. Volcker should be on your show. He’s got a new biography.

    RP: I don’t know whether we’ve reached out to him. He was more sympathetic to gold than some. So, when we went in, it was a one-on-one breakfast and we went over and the aide I had was somebody by the name of Lew Rockwell. We walk in and we got there a couple minutes early and Volcker’s staff was in the room where we were supposed to meet. So, we were just chatting away there in friendly conversation and then Volcker walks in, you can’t miss him because I think he’s about six-and-a-half feet tall. So, he walks in and I thought, “well I have to shake his hand and say hello.” He didn’t even look at me. He didn’t come to me. He went straight to his staff and he said, “what’s the price of gold?” So, I thought, “gold is important to him” and I still think it’s every bit as important to Fed people now because it is the ultimate measurement of the dollar. They can rig it and monkey around with it and play games, but ultimately, the market will have its say. That’s the way that Bretton Woods broke down the market. But then, of course, we talked and had the meeting and he didn’t convert me, but it was very polite. But, what I really remember about that was, he was very interested in what the price of gold was that morning.

    JD: The other huge and unfortunate series of events that marked your second time in Congress were 9/11 and then our subsequent invasion of Iraq and Afghanistan. Looking back, talk about that terrible period with Bush and Rumsfeld and Cheney and Wolfowitz. The Republicans in Congress were horrible too.

    RP: We started this interview off with talking about how bad the Depression was and World War II, and Korea, and Vietnam. But then when you look at some trends today, some things are almost worse because of our aggressiveness. Back then, it was sort of dumb economic policy and Fed policy that gave us Depression and war. But, we had a declaration of war and it seemed like it was more acceptable, given the circumstances. But in the 21st century, things dramatically changed after 9/11, and the US has become far more aggressive. After all, 9/11 wasn’t the reason for the wars that followed. It was the excuse. Washington policymakers already knew what they wanted to do in the Middle East before 9/11 even happened.

    My first speech, my first effort at peace, was shortly after I went back into Congress. I think it was 1998. It was the Iraq Freedom Act or I forget what it was called, but it was just intervention and threats and sanctions, that kind of stuff. I was saying those measures will lead to war. But, nobody was even talking about it in ’98, but it kept ratcheting up and getting worse and worse and worse.

    It just was sort of unbelievable that’s what we were doing, and of course I wasn’t able to stop the war. I thought I was supposed to be there to help stop the wars, but they’re still going on.

    JD: We’re going to feel the effects of these for decades and decades with the young people who’ve been hurt and need VA care.

    RP: It’s horrible.

    JD: And for all of your troubles, if you recall, there was that article in National Review from David Frum which called you and some other people, Pat Buchanan, “unpatriotic conservatives.” I always thought that you were neither. I think even some libertarians think of you as a conservative, but really you’re not in any political sense of that word.

    RP: No, it’s a tricky word. Because some people could argue that if you technically want to follow the only oath that we take as members of Congress, that’s sort of conservative, to obey the oath and follow it. But “conservative” in the sense of being a warmonger, and supporting the war on drugs, and not having an understanding of civil liberties. That’s not a good kind of “conservative.” Also, conservatives today, they don’t admit it, but they’re big spenders, they’re huge spenders. So no, in that sense, we libertarians are not conservative. Besides, Mises and other libertarians never liked to be called conservatives. They wanted to be called liberals. That’s the trickiness of language. I generally steer clear of the labels.

    I like to divide things into two parts: authoritarianism and volunteerism. On the one side are people who think that your life ought to be done on voluntary terms, as long as you reject aggression. On the other side are the authoritarians and they think they know what’s best for others. They really do. People I knew in Washington are convinced that people are idiots and therefore they can’t be responsible for themselves.

    That’s why they don’t want ordinary people to own guns — and government should have all the guns. If you wanted to compare the number of people who die from government guns versus private guns — historically, government kills about 95 percent of the people. Maybe it’s worse than that, when you think of the 20th century.

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