Today’s News 24th January 2018

  • America's Coldest Cities… And GDP

    As Q4 GDP data looms this week, we are reminded just how important ‘weather’ is in the narrative of economic growth in America.

    Q1 may fare far worse as the last few weeks saw the East Coast of the United States endure a brutal winter storm which caused the deaths of 16 people. It also led to widespread power outages and the cancellation of thousands of flights.

    As Statista’s Niall McCarthy notes, thick snow is common in the Northeast during the long and dark winter months but the cold snap came as more of a surprise in Florida. The 40 degree weather even caused iguanas and other reptiles to “fall out of trees”, immobilized by the cold.

    As shocking at the blast of cold was for Floridians, they can certainly count themselves lucky to live far away from the coldest areas of the U.S. where cladding yourself in layers of winter clothing is a normality.

    Infographic: America's Coldest Cities  | Statista

    You will find more statistics at Statista

    Website 24/7 Wall St. found that Fairbanks, Alaska, is America’s coldest city with minimum average temperatures in the coldest month a very chilly -16.9° F. The historic low is -66° F.

    The fact that the country’s coldest city is in Alaska probably comes as little surprise.

    Elsewhere, North and South Dakota dominate the list of America’s ten coldest cities. Three cities in North Dakota – Grand Forks, Williston and Fargo – follow Fairbanks with all having average temperatures at or below zero degrees.

  • WW3 Preparations? Amidst Drought, North Korean Officials Raid Homes And Farms To Feed Army

    Authored by Mac Slavo via SHTFplan.com,

    North Korean officials are ransacking homes and raiding farms in order to feed their starving army. 

     

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    Not only has the drought taken its toll on the nation, but this newest harsh seizure of food is causing internal clashes between the civilians and the army.

     

     

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    Soldiers for the communist regime had already been given long periods of leave in order to try to find food and make money to purchase food. However, it hasn’t been enough. Collective farms are suffering due to drought and poor harvests, leading officials to ransack farms and homes in order to find any stored food or money that might benefit the army, Daily NK reports.

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    While North Korean citizens are used to officials searching for food and asking for bribes, their use of increasingly brutal tactics to feed a starving army has led to reported clashes between troops and citizens. Farms in the country have not been able to meet quotas, and in response, officials are giving them new assignments.

    “We are suffering because collective farms in our region did not have a good harvest last year and so we were unable to fulfill the mandatory quota for military provisions. All individuals who weren’t able to meet the demands have been receiving additional assignments since the very beginning of January,” a source in South Hamgyong Province reported to Daily NK.

     “This year, we have to postpone our farm work due to this ‘extremely urgent’ task of gathering food for the military,” the source said.

    In the past, individuals were allowed to take leave from farm work to obtain money for fertilizer or farm equipment.  But this year, any money is being used to procure food and other items for military use.

    “Last year, most of this region, including the Taehongdan, Pochon, Samjiyon, and Paekam areas, were not able to meet their military provision quotas. These demands are pushing people to their wits’ end,” said a separate source in the Ryanggang Province.

    “Sometime in spring, the collective farms that are behind on their quotas will have some of their constituents provide frozen potatoes, which are processed by peeling and drying before presentation to the authorities. But many also call the season the ‘time when thieves (in this case, the farm authorities) rear their ugly heads,‘” he added.

    Famine is believed to have previously killed millions of people in the hermit kingdom. The communist regime prioritizes sending food and resources to the military and high ranking government officials over its general population.

  • Russian Submarine Seen Engulfed In Flames, Russian Navy Calls It An "Exercise"

    A video that first surfaced on Twitter and has since made the rounds on social media, appears to show a moored Russian Kilo-class attack submarine’s stern-engulfed in thick, black smoke.

    The striking footage was filmed in the Russian Pacific port city of Vladivostok, facing the Golden Horn Bay, near the borders with China and North Korea. The port of Vladivostok happens to be the home port of the Russian Pacific fleet and the most significant Russian port on the Pacific Ocean.

    Shortly after the videos were uploaded to social media, the Russian Navy swiftly came out calling the fire part of a “damage control exercise.” Russia’s news outlet TASS quoted the Russian Navy as stating:

    “Exercises to extinguish a fire on the pier using imitation were conducted on the territory of the connection of the Pacific Fleet submarines among personnel.” The contingent fire was eliminated in six minutes. “The personnel coped with the” excellent .” 

    Another report from Interfax News states that the Russian military has denied reports of a fire on the submarine base in Vladivostok.

    Five submarines and a dozen Russian naval ships are seen moored in close quarters to the high-volume, ultradense, thick, black smoke spewing from around the stern of the submarine.

    Black fires can reach temperatures of more than 1,000°F.  Material Safety Data Sheet published by ConocoPhillips shows the flashpoint of diesel fuel is between 125 and 180 degrees Fahrenheit, which indicates the fire in the video could indeed provide a hot enough flashpoint to ignite petroleum or diesel.

    Why mention diesel flashpoints? Because diesel-electric motors drive the Kilo-class attack submarine’s propulsion system. From the angle of the video, the position of the fire is around or within the stern of the sub, where the propulsion drive systems are located.

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    A view of the incident from across the harbor:

    Another vantage point of the incident from across the harbor: if indeed an exercise, where are the support teams to control the situation?

    According to Popular Mechanics, the Kilo-class attack submarine has a history of technical difficulties.

    In 2013, the Indian submarine INS Sindhurakshak caught fire and sank portside in Mumbai. A fire in the forward weapons bay triggered explosions of torpedoes and cruise missile warheads in the fully stocked bay. The accident killed eighteen sailors and rendered the ship unrecoverable, and it was finally stricken from Indian Navy rolls in 2017.

    The incident in Vladivostok has gained so much internet notoriety in the past few days, it has prompted the Russian military to officially deny it and call it a “damage control exercise”, which of course is the fastest way to confirm it happened. Because if the billowing black smoke was “planned”, we would hate to see what an out of control submarine incident would look like.

  • AI Censorship And The Power Of 'Steem' To Preserve Truth

    Authored by Tom Luongo,

    Just read a great article by Caitlin Johnstone over at Medium where she discusses the automation of censorship tools by companies like Twitter and Google.

    Putting paid Julian Assange’s warning last year on this, Ms. Johnstone details just some of the abuses that Twitter and Google engaged in to subtly and not-so-subtly shift public perception of major issues that run counter to the narrative the power structure wants us to believe.

    And it is for this reason that projects like Steemit are so very important.

    I talked about how important Steem is after James O’Keefe’s latest expose of Twitter (read it here).  Watching people like Mrs. Johnstone wake up to the problem is great, but she also needs to take the next step.

    You can’t hack something whose underlying content is stored in a distributed blockchain. Because the blockchain’s ledger is immutable, what you wrote is preserved in all of its glory (ignominious or otherwise) forever.

    As she points out, type of censorship is far worse than simply throwing books into piles and burning them. With DRM and all digital assets, inconvenient truths can be memory-holed off your Kindle never to be seen again.

    Abridged versions of books can be substituted for the original text and worse.

    So, the blockchain as it pertains to how we communicate is a fundamental need to disrupt this communications super-state they are building.

    I can’t stress enough how important this is today.

    Now, more than ever, the information war is heating up. And the ability to control not just the validity of what people produce but what everyone consumes is the single most important issue of the age.

    If we are to finally break the backs of the people working so hard to maintain their gravy train, we have to build systems that are beyond their control.

    This is an ideological war.

    One in which those that feel they have a right, nee a duty, to guide humankind to their preferred outcome for society.

    On the other side is the force of the individual and chaos and the beauty of decentralization to create order versus forcing it to.

    The essence of the authoritarian mindset was expressed beautifully in the much-maligned film, Batman v. Superman: Dawn of Justice.

    At his lowest point a paranoid, angry and bitter Batman is trying to kill that which he can’t control, Superman. And he says with all the fury of a frustrated villain, “The world only makes sense if you force it to.”

    As a long-time Batman fan I died a little inside to see him brought to that low.  But it was always there. That’s the problem when you fight for something without remembering what it is you are fighting for.

    It’s so easy to become that which you think you’re fighting against.

    And there is a better way than using their methods, which are inherently violent.  What they do is commit fraud in the name of progress.  And fraud is just another form of theft.

    Steem is the way to beat them at their own game, without using their methods.  Simply speak the truth and record it for all time.

    Moreover, it takes earning power of the idea-creator and puts it in their hands, not the hands of the distributors and the rent-seekers, like Google and Twitter.

    The growth of the platform is the way to claw back the capital they have been taking for themselves because before this we were just happy to have a platform to express ourselves.

    Now those platforms have become chains around our necks. Tools of censorship and oppression; spreading false narratives and suppressing the truth while making them billions.

    The worst part is that we are so inculcated in this abusive system that we come to devalue our own work. That it’s not worth $2 or even $20 for us to produce something that changes the course of someone’s life.

    And so people’s first reaction to Steem is that it’s a scam.  It is nothing of the sort.  The scam is Twitter.  The scam is Facebook.  Your life, ideas and work have value.  But, they’ve taught you to think that it doesn’t.

    That is the true power of ideas… and you know what the man said about ideas right?

     

    Properly managed and protected, so are blockchains created to hold those ideas, preserve them in digital amber and allow us to find our own way to the truth.

  • Watch A Comedian Shred CNN's Regime Change Talking Points In Under A Minute

    This could well be one of the most epic less-than-60-second devastating take-down of just about every mainstream media lie on Syria… In case you missed it, an entire panel of guests revolted against well-known conservative commentator S.E. Cupp’s demands that the US “do something” to remove the Assad government during a segment on her CNN HLN show late last week, but it was a comedian that delivered the final death blow, calling Cupp’s recycled regime change talking points “insane”.  

    Cupp has for years argued that “US inaction” is to blame for Syria’s woes and has been a consistent and prominent voice on the right calling for increased and more direct military action in the Syrian war – even as top US officials and Pentagon and intelligence insiders have since been very blunt in stating the obvious that only al-Qaeda and ISIS would fill the vacuum should the Assad government be removed by military force.

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    S.E. Cupp: “Isn’t it time to do something in Syria in a full-throated way?”

    During a recent Syria panel discussion on “SE Cupp Unfiltered,” she revisited the idea of regime change, posing the question for the panel: “isn’t it time to do something in Syria in a full-throated way?”

    For hawks like Cupp, nothing is ever enough apparently, even as Secretary of State Rex Tillerson has pledged that US forces will occupy… remain in Syria for an indefinite amount of time to support proxy SDF forces on the ground, primarily to “counter Iran” while seeking “political transition” in Damascus.

    She introduced the segment with a heatedly emotional appeal to her guest panelists, pleading we “must do something” because “500,000 people died while we did nothing” and arguing that “ignoring all of this… the chemical weapons, ISIS, al-Qaeda, Hezbollah, Iran, Russia… it just gets worse”. Cupp later answered her own question, saying that solving the crisis “is completely possible if you get rid of Assad“. 

    But the panel wasn’t buying it. In a rare moment for mainstream network television, the entire group of panelists revolted with each commentator getting more blunt in their pushback against Cupp than the last – until finally stand-up comedian and libertarian commentator Dave Smith apparently couldn’t take Cupp’s smug clichéd and recycled talking points anymore.

    Smith – though not some usual think tank blowhard that frequents such foreign policy debate panels – expertly schooled Cupp and dismantled her every assumption, demonstrating that it has been precisely US action in the region that has fueled the crisis in Syria, starting with the 2003 invasion of Iraq and continuing with the CIA program to arm the anti-Assad insurgency in Syria. And he did it all in under 60 seconds.

    “…The most ridiculous plan that I’ve heard yet… This is insane… ISIS rose because we overthrew Saddam Hussein and then we armed ISIS,” Smith said.  

    Watch the full clip below (stand-up comic Dave Smith comes in at the 1:55 mark): 

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    Smith’s epic diatribe met with no resistance. He said: 

    “Regime change has been an absolute nightmare everywhere that we’ve had it. And the idea that we’re going to go into a civil war and take both sides out is of all of these wars the most ridiculous plan that I’ve heard yet.

    And as far as standing back while hundreds of thousands of people die – no one seems to have a problem with doing that in Yemen right now because it’s not the regime that we want to overthrow, it’s the regime we support doing it.

    This is insane! ISIS did not rise because we pulled out of Iraq because of a bad decision – we pulled out on Bush’s timeline because we had to because the government of Iraq was no longer going to protect our troops against war crimes.

    ISIS rose because we overthrew Saddam Hussein and then we armed ISIS. We need to not intervene in this part of the world – it’s an immoral war, it’s an illegal war. Syria has not attacked America. We have no legitimate reason for our defense to be there, and this is exactly what Obama promised not to do, and what Trump promised not to do.”

    Apparently, S.E. Cupp couldn’t come up with any better response other than to half-heartedly say, “I disagree”… before quickly ending the segment.

  • Dollar Dumps Below Key Level – Worst Start To A Year Since 2003

    For the first time since December 2014, the Dollar Index has tumbled below 90.00 tonight as the greenback-bloodbath continues in early Asian FX trading…amid US trade policy concerns.

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    2017 was an ugly year for the dollar, but 2018 is starting off worse with the Dollar Index down 2.43% so far – the worst start since 2003.

    In fact it has been a one-way street since The Fed hiked rates in December.

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    Also of note tonight, the dollar weakness has sent USDJPY back below 110

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    As Bloomberg reports, the dollar dropped to a three-year low, weighed by concerns over U.S.’s trade policies and a report that President Donald Trump may be questioned in the Russian investigation.

    The Dollar Index is poised for its third day of losses as investors await China’s reaction to Trump’s trade tariffs on solar panels and washing machines.

    Special counsel Robert Mueller wants to question Trump about his decision to fire former FBI Director James Comey as well as the removal of Michael Flynn.

    “While at this stage Trump’s protectionist rhetoric is being applied sparingly and not drawing a reaction from China, there is the threat of Trump ramping up protectionism,” said David Forrester, a strategist at Credit Agricole SA’s corporate and investment-banking unit in Hong Kong. That will weigh on the dollar, he said.

    The question is – will the lagged correlation continue?

     

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  • It's Official: 2017 Was Mexico's Most-Murderous Year Ever

    Across the 31-Mexican states, there were 29,168 homicides in 2017, the federal government published in a brand new report on Sunday, making last year the most murderous year on record.

    Infographic: Drug Violence Drives Mexico Murders To Record High  | Statista

    You will find more statistics at Statista

    The latest homicide data from the interior ministry is the highest ever to be reported since records were first kept in 1997 and represents a whopping 27% surge over 2016 figures.

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    The interior ministry details last year’s per capita homicide rate at 20.5 per 100,000 inhabitants, up more than one point from 19.4 in 2011.

    Last week, President Trump tweeted that Mexico is one of the most dangerous countries in the world. He cited the “massive inflow of drugs” and alluded to the out of control cartel violence across the nation, as a great sales pitch to the American people of why his proposed Mexico–United States border wall needs funding.

    Earlier this month, the U.S. State Department warned U.S. citizens and U.S. government employees to exercise increased caution while traveling in Mexico, and even restricted some regions from access because of “violent crime, such as homicide, kidnapping, carjacking, and robbery.”

     

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    While the U.S. State Department discouraged all travel to 31 Mexican states, the new travel warning elevated five states to a level-4 status, otherwise known as a war-zone like some countries in the Middle East.

    The U.S. State Department defines Level-4 as :

    Do Not Travel: This is the highest advisory level due to greater likelihood of life-threatening risks. During an emergency, the U.S. government may have very limited ability to provide assistance. The Department of State advises that U.S. citizens not travel to the country or leave as soon as it is safe to do so. The Department of State provides additional advice for travelers in these areas in the Travel Advisory. Conditions in any country may change at any time.

    Level-4 states in Mexico:

    • Colima state due to crime.
    • Guerrero state due to crime.
    • Michoacán state due to crime.
    • Sinaloa state due to crime.
    • Tamaulipas state due to crime.

    A majority of the level-4 states reside in the western region of Mexico, where violence between drug cartels is out of control.

    CNN describes that outside the world’s war zones of the Middle East, Mexico is by far the most dangerous place for journalists.

    Last year six journalists were killed in Mexico, according to the Committee to Protect Journalists, a US nonprofit. That was the highest number since at least 1992. Since that year more than 40 journalists have been killed in the country.

    Despite 16% of the Mexican states classified as a war-zone or “shithole” by the U.S. State Department, there is even more death and destruction in South American countries. El Salvador reported a homicide rate of 60.8 per 100,000 inhabitants last year, which is three times the rate of Mexico. Brazil and Colombia recorded more violent rates than Mexico in 2017, with both countries averaging around 27 per 10,000 inhabitants. The rates for several U.S. cities, including St Louis, Baltimore, New Orleans and Detroit, were also higher than the overall rate for Mexico, AP said.

    Nevertheless, the homicide rates were wildly disturbing in level-4 states in Mexico. Take, for instance, the small Pacific coast state of Colima had 93.6 homicides per 100,000 inhabitants last year, while a non-level-4 region of Baja California Sur logged in 69.1 per 100,000 inhabitants last year.

     

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    Here is what CNN had to say about the Mexican “shithole”-

    In Guerrero — the state where Acapulco is located — murders rose to 2,316 last year, about the same as 2016, but up from 1,514 in 2014.

    In Sinaloa, the former turf of notorious, imprisoned drug lord Joaquin “El Chapo” Guzman, homicides in 2017 soared 39% over last year to 1,332.

    In Baja California Sur, an area filled with popular tourist destinations such as Cabo San Lucas, the number of murders nearly tripled last year to 560.

    Security and crime look set to be among the top issues in Mexico’s presidential campaign season, which officially begins in March. The election is July 1. President Enrique Peña Nieto can’t run again due to term limits. He and his political party have been heavily criticized for their inability to tame drug-related crime.

    His administration has also called on the United States to help more, arguing that Americans’ demand for drugs is partly fueling.

    Mexico is preparing for the general elections in July. Voters will elect a new president, 500 members of the Chamber of Deputies, and 128 Senate members. The current Mexico President Enrique Pena Nieto had pledged to end drug cartels violence throughout the country in 2012, but that turned out to be a wishful campaign promise as homicides in 2017 surged to record levels.  The left-wing and former Mexico City mayor Andres Manuel Lopez Obrador is the current frontrunner, as cartel violence and drugs will be a pivot topic during the election.

  • Patrick Cockburn Rages: "It's Time To Call Economic Sanctions What They Are: War Crimes"

    Authored by Patrick Cockburn via Counterpunch.org,

    The first pathetic pieces of wreckage from North Korean fishing boats known as “ghost ships” to be found this year are washing up on the coast of northern Japan. These are the storm-battered remains of fragile wooden boats with unreliable engines in which North Korean fishermen go far out to sea in the middle of winter in a desperate search for fish.

     

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    Often all that survives is the shattered wooden hull of the boat cast up on the shore, but in some cases the Japanese find the bodies of fishermen who died of hunger and thirst as they drifted across the Sea of Japan. Occasionally, a few famished survivors are alive and explain that their engine failed or they ran out of fuel or they were victims of some other fatal mishap.

    The number of “ghost ships” is rising with no fewer than 104 found in 2017, which is more than in any previous year, though the real figure must be higher because many boats will have sunk without trace in the 600 miles of rough sea between North Korea and Japan.

    The reason so many fishermen risk and lose their lives is hunger in North Korea where fish is the cheapest form of protein. The government imposes quotas for fishermen that force them to go far out to sea. Part of their catch is then sold on to China for cash, making fish one of the biggest of North Korea’s few export items.

    The fact that North Korean fishermen took greater risks and died in greater numbers last year is evidence that international sanctions imposed on North Korea are, in a certain sense, a success: the country is clearly under severe economic pressure. But, as with sanctions elsewhere in the world past and present, the pressure is not on the North Korean leader Kim Jong-un, who looks particularly plump and well-fed, but on the poor and the powerless.

    The record of economic sanctions in forcing political change is dismal, but as a way of reducing a country to poverty and misery it is difficult to beat. UN sanctions were imposed against Iraq from 1990 until 2003. Supposedly, it was directed against Saddam Hussein and his regime, though it did nothing to dislodge or weaken them: on the contrary, the Baathist political elite took advantage of the scarcity of various items to enrich themselves by becoming the sole suppliers. Saddam’s odious elder son Uday made vast profits by controlling the import of cigarettes into Iraq.

    The bureaucrats in charge of UN sanctions in Iraq always pretended that they prevented Saddam rebuilding his military strength. This was always a hypocritical lie: the Iraqi army did not fight for him in 1991 at the beginning of sanctions any more than it did when they ended. It was absurd to imagine that dictators like Kim Jong-un or Saddam Hussein would be influenced by the sufferings of their people.

    These are very real: I used to visit Iraqi hospitals in the 1990s where the oxygen had run out and there were no tyres for the ambulances. Once, I was pursued across a field in Diyala province north of Baghdad by local farmers holding up dusty X-rays of their children because they thought I might be a visiting foreign doctor.

    Saddam Hussein and his senior lieutenants were rightly executed for their crimes, but the foreign politicians and officials who were responsible for the sanctions regime that killed so many deserved to stand beside them in the dock. It is time that the imposition of economic sanctions should be seen as a war crime, since it involves the collective punishment of millions of innocent civilians who die, sicken or are reduced to living off scraps from the garbage dumps.

    There is nothing very new in this. Economic sanctions are like a medieval siege but with a modern PR apparatus attached to justify what is being done. A difference is that such sieges used to be directed at starving out a single town or city while now they are aimed at squeezing whole countries into submission.

    An attraction for politicians is that sanctions can be sold to the public, though of course not to people at the receiving end, as more humane than military action. There is usually a pretence that foodstuffs and medical equipment are being allowed through freely and no mention is made of the financial and other regulatory obstacles making it impossible to deliver them.

    An example of this is the draconian sanctions imposed on Syria by the US and EU which were meant to target President Bashar al-Assad and help remove him from power. They have wholly failed to do this, but a UN internal report leaked in 2016 shows all too convincingly the effect of the embargo in stopping the delivery of aid by international aid agencies. They cannot import the aid despite waivers because banks and commercial companies dare not risk being penalised for having anything to do with Syria. The report quotes a European doctor working in Syria as saying that “the indirect effect of sanctions … makes the import of the medical instruments and other medical supplies immensely difficult, near impossible.”

    People should be just as outraged by the impact of this sort of thing as they are by the destruction of hospitals by bombing and artillery fire. But the picture of X-ray or kidney dialysis machines lacking essential spare parts is never going to compete for impact with film of dead and wounded on the front line. And those who die because medical equipment has been disabled by sanctions are likely to do so undramatically and out of sight.

    Embargoes are dull and war is exciting. A few failed rocket strikes against Riyadh by the Houthi forces in Yemen was heavily publicised, though no Saudis were killed. Compare this to the scant coverage of the Saudi embargo on Houthi-held Yemen which has helped cause the largest man-made famine in recent history. In addition, there are over one million cholera cases suspected and 2,000 Yemenis have died from the illness according to the World Health Organisation.

    PR gambits justifying sanctions are often the same regardless of circumstances. One is to claim that the economic damage caused prevents those who are targeted spending money on guns and terror. President Trump denounces the nuclear deal with Iran on the grounds that it frees up money to finance Iranian foreign ventures, though the cost of these is small and, in Iraq, Iranian activities probably make a profit.

     

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    Sanctions are just as much a collective punishment as area bombing in East Aleppo, Raqqa and Mosul. They may even kill more people than the bombs and shells because they go on for years and their effect is cumulative. The death of so many North Korean fishermen in their unseaworthy wooden craft is one side effect of sanctions but not atypical of their toxic impact. As usual, they are hitting the wrong target and they are not succeeding against Kim Jong-un any more than they did against Saddam Hussein.

  • Tillerson Blames Russia For Alleged Syria Chemical Attack After Admitting He Doesn't Actually Know Who Did It

    It’s so absurd it’s hard to believe, but when it comes to US policy absurdity has been par for the course over the past years. At an international meeting hosted by France on global chemical weapons proliferation Secretary of State Rex Tillerson blamed both Syria’s President Bashar al-Assad and Russia for carrying out a purported new chemical attack in the Damascus suburb of East Ghouta. Speaking from Paris on Tuesday, Tillerson said, Whoever conducted the attacks Russia ultimately bears responsibility for the victims in eastern Ghouta and countless other Syrians targeted with chemical weapons since Russia became involved in Syria.”

    That’s right – in the same sentence Tillerson leveled the accusation against Russia, while simultaneously pointing the finger at Assad, he admitted that he really doesn’t know much at all about “whoever conducted the attacks”.

    The incident, a reported chlorine gas attack delivered via rockets, is said to have happened Monday in the same suburb of Syria’s capital that a much larger August 2013 attack took place, which the United States blamed on Assad, which nearly precipitated direct US military intervention under the Obama administration, according to an investigative report by Seymour Hersh in the London Review of Books.


    Tillerson issued the accusation at chemical weapons conference in Paris on Tuesday. Image source: AP via The Washington Post

    “Only yesterday more than 20 civilians, mostly children, were victims of an apparent chlorine gas attack,” Tillerson said at the Paris conference involving 24 nations, which has eyed chemical weapons usage in Syria in particular. He added that the attacks “raise serious concerns that Bashar al-Assad may be continuing to use chemical weapons against his own people.”

    And this is where the US Secretary of State asserted, “Whoever conducted the attacks Russia ultimately bears responsibility for the victims in eastern Ghouta and countless other Syrians targeted with chemical weapons since Russia became involved in Syria.”

    The sole sources for the reports include two well-known opposition groups, namely the White Helmets and the UK-based Syrian Observatory for Human Rights (SOHR) – both of which have long been on record as seeking regime change in Syria and have been go-to sources for American and UK media in particular. SOHR is led by one man, an activist named Rami Abdulrahman, who lives in Coventry, England, while the White Helmets is on record as being funded by US and UK governments to the tune of many tens of millions of dollars, and has further been caught cooperating closely with al-Qaeda factions on the ground in Syria. Indeed the group only operates in areas controlled by al-Qaeda (HTS) and other anti-government insurgents.

    On Monday the White Helmets posted two videos to its Twitter account, purporting to show the aftermath of the attack. The first video included men and children, some lying on hospital beds, in a makeshift clinic receiving treatment. The White Helmets statement claimed, “More than 20 of suffocation so far following the bombing of the Assad regime forces with missiles carrying poisonous gases (probably chlorine).” The second video merely shows a White Helmets rescue worker carrying an infant in the back of an ambulance with no chemical protective gear on. 

    It appears that Tillerson is pointing the finger at Assad and Russia based solely on the White Helmets videos and accusations, despite the fact that no international observer or investigative body has confirmed that the incident even took place. Tillerson further used the alleged incident to blame Russia for breaking prior commitments made regarding the 2013-2014 US-Russia brokered deal to dismantle Syria’s extensive nerve agent program, which was widely reported to have been successfully carried out and completed in 2014. 

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    “There is simply no denying that Russia, by shielding its Syrian ally, has breached its commitments to the United States as a framework guarantor,” Tillerson said of the prior 2013 agreement, and added, “Russia’s failure to resolve the chemical weapons issue in Syria calls into question its relevance to the resolution of the overall crisis. At a bare minimum, Russia must stop vetoing and at least abstain on future UNSC resolutions on this issue.”

    Meanwhile, earlier on Tuesday, Russia’s Deputy Foreign Minister Sergey Ryabkov heavily criticized the Paris conference, which has as its mission the creation of an ‘International Partnership against Impunity for the Use of Chemical Weapons’, accusing attendees of seeking to create a new “quasi-collective” organ instead of using already existing international institutions. The Russian Deputy FM said in a statement carried by RT that, “The quasi-collective approach, or, in fact, gathering up the states who cannot go against Euro-grands and the US is a direct violation of the prerogatives of the Organization for the Prohibition of Chemical Weapons, a blow to the UN platform,” Ryabkov said.

    “We believe that the result of such sort of ‘exercises’ will be only further partition of the international community,” he warned. “Authors of such ideas and initiatives should really consider the consequences.”

    Russia has long accused the US of blindly trusting opposition sources inside Syria concerning claims of chemical weapons attacks, including an April 2017 incident in al-Qaeda controlled (HTS) Idlib, which resulted in the US attacking an airbase in central Syria.

    Last October, the US State Department admitted that anti-Assad militant groups operating in Syria, especially in Idlib, possess and have used chemical weapons throughout the war – something which the US government said was impossible, as it consistently held the position that only the Assad government could be to blame. 

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Today’s News 23rd January 2018

  • Will Missing Texts Save Manafort From Mueller's Probe?

    Some have suggested that the FBI losing five months of text messages between anti-Trump investigators is a coverup of an “insurance policy” to smear Donald Trump with claims of Russian collusion in the event of a win. Others have suggested it’s simply bureaucratic incompetence. Paul Manafort’s attorneys, on the other hand, are likely chomping at the bit see if they can argue for a dismissal of the federal charges against their client due to Robert Mueller’s increasingly tainted probe.

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    Look for Paul Manafort to jump all over this. He’s already fighting his indictment, claiming that Mueller is overstepping his authority and shouldn’t be running the investigation. Throw in this evidence that the investigation may have been tainted before Mueller even took over, and that the DOJ could be covering up damaging information, and a motion to dismiss alleging prosecutorial misconduct is a near certainty.

    FBI Agent Strzok was reportedly heading up the Manafort investigation before he was taken off the Mueller probe. Manafort’s attorney might try to say that the missing text messages could contain exculpatory evidence (or evidence favorable to the defendant) and therefore the court should get to the bottom of what the two said.  However, two former federal prosecutors who spoke to Law&Crime both contend it would be difficult to get the entire indictment dismissed based on the text messages alone.LawandCrime.com

    “It depends on what FBI’s retention policy is for text messages. It does certainly raise questions as to how these five months came up missing,” explained former federal prosecutor Bill Thomas, adding “However, the court is not going to just dismiss the case. If it comes to it, the judge may hold a hearing to get to that information through calling witnesses. Dismissal is the nuclear option, it would have to be something very very egregious for a court to dismiss the case.”

    Very very egregious

    The bombshell announcement regarding the missing text messages did not go over well with Congressional investigators. In a letter from Sen. Ron Johnson (R-WI), Chairman of the Senate Homeland Security and Governmental Affairs Committee (HSGAC) to FBI director Christopher Wray, Johnson asks five key questions: 

    1. Please explain the scope and scale of all records lost, destroyed, or otherwise alienated during the midyear examination investigation
    2. Does the FBI have any records of communications between Ms. Page and Mr. Strzok between December 14, 2016 and May 17, 2017? If so, please provide those communications.
    3. Has the FBI conducted searches of Mr. Strzok and Ms. Page’s non-FBI-issued communication devices or accounts to determine whether federal records exist on those nonofficial accounts? Please explain how the FBI is complying with federal records requirements with respect to these devices.
    4. Has the FBI produced text messages to the Department of Justice Office of the Inspector General (DOJ OIG) or any other FBI employees in furtherance of the DOJ OIG’s review of the Clinton email investigation? If so, please identify which FBI employees’ communications were produced.
    5. Has the FBI produced Microsoft Lync conversations between Ms. Page and Mr. Strzok to the DOJ OIG? Please explain. 

     

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    Question four is an interesting one – considering the conflicting information discovered last night between the FBI and the Office of the Inspector General (OIG). A Friday document submission from the DOJ included a cover letter from the Assistant AG for Legislative Affairs, Stephen Boyd, claiming that the FBI was unable to preserve text messages between the two agents for a five month period between December 14, 2016 and May 17, 2017 – due to “misconfiguration issues” with FBI-issued Samsung 5 devices used by Strzok and Page (despite over 10,000 texts which were recovered from their devices without incident).

     

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    However – as Josh Caplan points out, the lost text messages are in direct contradiction to a December 13, 2017 letter from the DOJ’s internal watchdog – Inspector General Michael Horowitz, to Senate Judiciary Committee Chuck Grassley and HSGAC Chairman Ron Johnson, in which he claims he received the texts in question on August 10, 2017

    In gathering evidence for the OIG’s ongoing 2016 election review, we requested, consistent with standard practice, that the FBI produce text messages from the FBI-issued phones of certain FBI employees involved in the Clinton email investigation based on search terms we provided. After finding a number of politically-oriented text messages between Page and Strzok, the OIG sought from the FBI all text messages between Strzok and Page from their FBI-issued phones through November 30, 2016, which covered the entire period of the Clinton e-mail server investigation. The FBI produced these text messages on July 20, 2017. Following our review of those text messages, the OIG expanded our request to the FBI to include all text messages between Strzok and Page from November 30, 2016, through the date of the document request, which was July 28, 2017.

    The OIG received these additional messages on August 10, 2017.

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    As one can see, the deleted text messages are not only highly unusual – but the circumstances surrounding their disappearance are highly suspect, and may even be “very very egregious” upon further analysis

    We’re sure Paul Manafort’s legal team is drafting a motion to dismiss at this very moment.

  • Retired Green Beret Warns "The Public's Attention Is Being Diverted From What Is Really Happening"

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

    The Russian surveillance vessel the Viktor Leonov was reportedly leaving the Caribbean over the weekend bound toward the U.S. East Coast. Florida will be reached by next Friday, and before this, the King’s Bay ballistic missile submarine base in Georgia is also along their projected route. This comes on the heels of what has gone largely unreported by the Mainstream Media. On Friday, 1/19/18, a report from U.S. National News emerged, entitled Submarine off of NJ/DE/MD coasts? US Navy deploys NINE Anti-Submarine Aircraft off East Coast Fearing Sub Missile Launch Against US. Here is an excerpt:

    The East Coast of the United States may be subjected to attack by submarine launched missile(s) and the US Navy has scrambled NUMEROUS P-8A POSEIDON anti-submarine aircraft, to repeatedly search coastal waters from New York City to Washington, DC ALL DAY Thursday into Thursday Evening. 

    According to flight records, at least NINE anti-submarine warfare aircraft were sortied Thursday off the US East Coast, and Flight Records show they were engaged in very active hunting for submarine(s) off the East Coast . . .. well WITHIN the 12-mile territorial limit of the United States.

    This article has plenty of photos, and some with the locations of CAP (Civil Air Patrol) enlisted to aid the U.S. Navy with the “shortfall” in radar coverage and area surveillance. The article also gives the disposition of numerous aircraft and shows the locations of monitored Russian submarines.

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    While all of this has been happening, “statesman” Rex Tillerson just came out and declared this at Stanford University on Wed., 1/17/18, as reported by RT News:

    “The Japanese… have had over a 100 North Korean fishing boats that have drifted into Japanese waters. Two-thirds of the people on those boats have died.” 

    “They [The fishermen] are being sent in the wintertime to fish because there are food shortages. And they are being sent out to fish with inadequate fuel to get back. So, we are getting a lot of evidence that these [sanctions] are really starting to hurt.

    Honorable Secretary of State Rex Tillerson. Pure statesmanship, pure diplomacy? No: pure extortion. This coming from a country (the U.S.) that wanted to depose Assad for the “brutal human rights violations” against civilians…but when it involves the civilians of a country we want to crush…what are a few hundred starving North Korean fisherman’s lives worth? Hey, the sanctions work! We oust leaders for human rights violations, but our policies and sanctions are “humane,” and “altruistic.” Let them join the IMF and World Bank, become a vassal, then they can shop at Costco. Then: let them eat cake!

    North Korea has the resolve to see through any paper-tiger sanctions initiated by a country that is a dying empire backed up by a “toothless” UN.

    China and Russia have the resolve to be positioning their assets now…prior to the conflict…the war that is forthcoming. It has been reported that the Chinese have moved troops and radiation detectors along their border with North Korea.

    Just about a week ago, the RAF had to scramble Typhoons to escort Russian bombers conducting practice runs along the Cold War routes that cover the UK.

    A very in-depth article came out that reports Russia and China to be skeptical concerning the U.S.’s gold supply.

    Economics is another form of warfare: should they prove the U.S. to not have on hand the gold reserves it claims to have, or (as it states) that the gold is of inferior quality to that traded by the rest of the world? This may very well be the final kicker to persuade nations to distrust the falling Petrodollar and remove the dollar as the World Currency exchange. Such would establish the positions of gold-backed Rubles and Yuan that also have oil to trade, to further bolster that worth on a global economy. For those who still watch television, enjoy your football and the upcoming Olympics.

    But keep this in mind: the powers that be will not rest in their inexorable march toward global government.

    It would not be the first time that bread and circuses were used to keep the mob entertained…and distracted from the sinister actions and purposes of their leaders and governments. In the meantime, other nations are preparing and positioning their forces, as well as conducting intelligence and surveillance on us…prior to the war that may come anytime.

    If the politicians are any indicator of how we’ll fare…the prognosis doesn’t look good. All of it can be avoided with diplomacy, but war is a money-maker, and a game changer for an incumbent whose ratings are flagging. War is their solution. Why? Because they live off our labors and our tax dollars ensure they’ll be safe and sound in their bunkers. Their world: opulent feasts, riches, maintaining power, with armies and unlimited resources…it will remain intact. Ours will not.

  • The Price Of Freedom: MbS's Corruption Crackdown Nets $100 Billion For Saudi State

    After nearly three months of “enhanced interrogations” and at least one reported death, Mohammad bin Salman’s hired mercenaries have nearly finished the job. Bloomberg reported Monday that half of the roughly 180 royals being held at the Riyadh Ritz Carlton have agreed to pay a financial settlement in exchange for their freedom.

    The total amount raised is $100 billion in cash, stock, real estate and other assets – enough to cover the state’s 2017 budget deficit, and then some.

    Talks with suspects are expected to end by the end of the month and authorities will likely recover more than $100 billion in settlements, a senior official said, asking not to be identified because the details are private. Those who don’t reach deals will be referred to prosecutors, the official said.

    Authorities have already agreed to drop charges against about 90 suspects who were released, Attorney General Sheikh Saud Al Mojeb said in a separate interview at the Ritz-Carlton late on Sunday. About 95 people were still at the hotel, including five weighing settlement proposals, with the others reviewing evidence presented against them, he said.

    “The royal order was clear,” Al Mojeb said, as Arabic music streamed through loudspeakers in the hotel lobby. “Those who express remorse and agree to settle will have any criminal proceedings against them dropped.”

    That group reportedly includes Prince Alwaleed bin Talal, one of the world’s richest men. Bin Talal was reportedly strung upside down and beaten by mercenaries during his interrogation. He eventually relented and agreed to a settlement. Back in November, we reported that Miteb al Abdullah, a prince accused of embezzlement and corruption, settled for $1 billion.

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    Major General Ali Alqahtani was reportedly beaten to death by mercenaries after refusing the state’s offer of a settlement. Meanwhile, at least one royal, Prince Abdul Aziz bin Fahd, was killed during a gun battle with Saudi state security after refusing to surrender.

    Several other high-ranking officials died in suspicious helicopter crashes around the time the purge was launched on Nov. 4.

    Billionaire Prince Alwaleed Bin Talal was among those detained, as was former Finance Minister Ibrahim Al-Assaf and Adel Al Fakeih, who was removed as minister of economy and planning on the eve of the arrests.

    The princes were detained in the 495-room hotel in Riyadh. Shortly after the crackdown began, images began circulating of royals sleeping on what appeared to be dirty mattresses in the ballroom of the Ritz Carlton.

    While 95 princes remain at the hotel, Bloomberg reported that only a handful are expected to reach a settlement. The rest will, presumably, serve lengthy prison sentences.

    Riyadh

    Saudi officials have defended the crackdown, while foreign observers have complained about a lack of transparency and rumors of widespread human rights abuses.

    The probe was conducted in a “pretty nontransparent way,” according to Moritz Kraemer, global chief rating officer at S&P Global Ratings, who appeared on Bloomberg TV Monday. The probe “could be a step in the right direction but it could also be a step towards more arbitrary ruling,” he said.

    About 350 people have been summoned during the probe, but many came as witnesses or to provide information, with some spending only a few hours or less at the Ritz, the official said.

    With the purge nearly over, the remaining guests will presumably soon be moved to their, uh, long-term accommodations, as the hotel has revealed that it will be taking bookings again as of Feb. 14.

    According to Bloomberg, Al Mojeb denied the suspects’ rights were violated. All had access to legal council and some did retain lawyers, though many chose to settle voluntarily without outside representation, he said. Those released faced no restrictions on their movement, he said.

     

  • Paul Craig Roberts Slams The NSA: "It's A Blackmail Agency"

    Authored by Paul Craig Roberts,

    The main function of the National Security Administration is to collect the dirt on members of the house and senate, the staffs, principal contributors, and federal judges.

     

     

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    The dirt is used to enforce silence about the crimes of the security agencies.

    The blackmail mechanism was put into gear the minute the news reported that the House Intelligence Committee had assembled proof that the FBI, DOJ, and DNC created Russiagate as a conspiracy to unseat President Trump. Members of Congress with nothing to hide demanded the evidence be released to the public.

    Of course, it was to be expected that release of the facts would be denounced by Democrats, but Republicans, such as Rep. Mike Conaway (R, Texas), himself a member of the committee, joined in the effort to protect the Democrats and the corrupt FBI and DOJ from exposure. Hiding behind national security concerns, Conaway opposes revealing the classified information. “That’d be real dangerous,” he said.

    As informed people know, 95% of the information that is classified is for purposes that have nothing to do with national security.

    The House Intelligence Committee memo has no information in it related to any security except that of Comey, Brennan, Clapper, Hillary, Obama, Mueller, Rosenstein, Peter Strzok, Lisa Page, the DNC, and the presstitute media.

    The logical assumption is that every member of Congress opposed to informing the American public of the Russiagate conspiracy to unseat the President of the United States is being blackmailed by the security agencies who planned, organized, and implemented the conspiracy against the President of the United States and American democracy.

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    American insouciance is a great enabler of the ability of the security agencies and their media whores to control the explanations.

  • "I Have To Apologize" – Contrite Pope Sorry For Accusing Child Sex-Abuse Victims Of Lying

    A day after Pope Francis ended his trip to Chile by publicly defending a bishop who victims have accused of covering up widespread pedophilia in the country, by attacking the credibility of child sex abuse victims in a shocking move made at the end of a trip which he had hoped to ‘heal’ the wounds of said abuse, The Holy See has stunned Catholics again… and apologized.

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    As we detailed over the weekend Associated Press reported that Francis made the shocking comments in a discussion about Rev. Fernando Karadima who has been found guilty of sexually abusing a slew of minors as a member of the Catholic Church.

    Pope Francis accused victims of Chile’s most notorious pedophile of slander Thursday, an astonishing end to a visit meant to help heal the wounds of a sex abuse scandal that has cost the Catholic Church its credibility in the country.

    “The day I see proof against Bishop Barros, then I will talk. There is not a single piece of evidence against him. It is all slander. Is that clear?” the pope replied in a snippy tone.

    The pope’s remarks drew shock from Chileans and immediate rebuke from victims and their advocates. They noted the accusers were deemed credible enough by the Vatican that it sentenced Karadima to a lifetime of “penance and prayer” for his crimes in 2011.

    A Chilean judge also found the victims to be credible, saying that while she had to drop criminal charges against Karadima because too much time had passed, proof of his crimes wasn’t lacking.

    And now, as Reuters reports, Pope Francis, in an extremely rare act of self-criticism, apologised to victims of clerical sex abuse on Sunday, acknowledging he had “wounded many” in comments defending a Chilean bishop who is under scrutiny.

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    However, while the pope was sorry for his choice of words, he hastily added that he was certain that the prelate, Juan Barros, who has been accused of being complicit in the cover-up of the disgusting acts, was innocent.

    “I have to apologise,” an unusually contrite pope told reporters aboard the plane returning to Rome from a week-long trip to Chile and Peru, saying he realised he had “wounded many people who were abused”.

    “I apologise to them if I hurt them without realising it, but it was a wound that I inflicted without meaning to,” he said. “It pains me very much.”

    But, in the latest twist to a saga that has gripped Chile, Francis said Barros, who is accused of protecting a notorious paedophile, would remain in his place in the diocese of Osorno because there currently was no credible evidence against him.

    Francis said on the plane: “I know how much they (abuse victims) suffer in hearing the pope say to them ‘bring me a letter with the proof,’ I realise that it is a slap in their faces, and now I realise that my expression was an unfortunate one”.

    In his comments on the plane, the pope disclosed that Barros had offered to resign twice in recent years but Francis rejected the offers.

    “I can’t condemn him because I don’t have evidence and because I am convinced he is innocent,” Francis said.

    He said Barros would remain in his place unless credible evidence is found against him.

    Juan Carlos Claret, a spokesman for anti-Barros Catholics in Osorno, southern Chile, said during the trip that he worried the pope’s response to the reporter before the apology would discourage more victims from speaking out.

    “What incentive will victims have to come forward when even if the courts and the Vatican have said they are right, in the end the pope says they are pure lies?” he said in an telephone interview.

    #SeeToo?

  • FBI Agents Discussed "Secret Society" Within DOJ And FBI Working To Undermine Trump

    Congressional investigators learned from a new batch of text messages between anti-Trump FBI investigators that a “secret society of folks” within the Department of Justice and the FBI may have come together in the “immediate aftermath” of the 2016 election to undermine President Trump, according to Rep. John Ratcliffe (R-TX) who has reviewed the texts.

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    The new texts were included in a 384-page DOJ document release to Congressional investigators last Friday – during which Congress was notified in the cover letter that that five months of text messages from December 14, 2016 to May 17, 2017 have gone missing (If only the NSA had copies). 

    Ratcliffe was joined by Rep. Trey Gowdy (R-SC) to discuss the latest developments with Fox News host Martha McCallum, when Ratcliffe said: 

    What we learned today in the thousands of text messages that weve reviewed that perhaps they may not have done that (checked their bias at the door). There’s certainly a factual basis to question whether or not they acted on that bias. We know about this insurance policy that was referenced in trying to prevent Donald Trump from becoming president.

    We learned today from information that in the immediate aftermath of his election that there may have been a secret society of folks within the Department of Justice and the FBI to include Page and Strzok to be working against him.

    Watch: 

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    Rep. Gowdy deflected a question over a second special counsel, but mentioned “a text about not keeping texts,” and “more manifest bias against President Trump all the way through the election into the transition,” and finally Gowdy said he saw a text that “Director Comey was going to update the President of the United States about an investigation” which would have been Obama – and may, Gowdy speculates, have been about the Trump team.

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    Regarding the “secret society,” Gowdy said “You have this insurance policy in Spring 2016, and then the day after the election, what they really didn’t want to have happen, there is a text exchange between these two FBI agents, these supposed to be fact-centric FBI agents saying, ‘Perhaps this is the first meeting of the secret society.’ So I’m going to want to know what secret society you are talking about, because you’re supposed to be investigating objectively the person who just won the electoral college. So yeah — I’m going to want to know.”

    As we have been reporting over the last two days, the FBI “lost” five months of text messages between anti-Trump FBI agents Peter Strzok and Lisa Page. 

    The explanation for the gap was “misconfiguration issues related to rollouts, provisioning, and software upgrades that conflicted with the FBI’s collection capabilities.

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    The missing texts conveniently span the period between Dec. 14, 2016 and May 17, 2017 – the day Robert Mueller was appointed to take over the FBI’s probe of alleged Trump-Russia collusion, and during the period in which the FBI would ostensibly have been hard at work on their “insurance policyagainst a Trump victory – and during the period in which the “secret society” Rep. Ratcliffe referred to would have been hard at work

    A controversy also emerged following the revelation over the missing “textgate” – in that the DOJ’s internal investigative unit, the Office of the Inspector General (OIG) wrote a letter in December of last year specifically stating that they had obtained text messages from Strzok and Page covering the “missing” period revealed last Friday. 

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    Alas, it appears the Inspector General Michael Horowitz made this statement in error, as Attorney General Jeff Sessions said in a Monday statement that Horrowitz was in fact the one who discovered the FBI’s system failed to retain text messages for approximately 5 months,” which was confirmed by Fox News. 

    A Justice Department spokesperson told Fox News that the Departments Office of Inspector General also does not have any text messages between the two during that time period.

    Not to worry – the DOJ, known for its honesty, will leave “no stone unturned.”

  • "We Can't Pretend Interest Payments Aren't Rising Anymore…"

    Authored by Sven Henrich via NorthmanTrader.com,

    Is anyone paying attention? I don’t know, but the cost of carrying debt has been rising and it’s already showing measurable impacts despite the Fed Funds rate still being very low.

    My concern of course is that the global debt construct will bring global growth to a screeching halt (see also The Debt Beneath).

    As the 10 year is already piercing above the 2.6% area now I want to pay attention to the data coming in as the Fed is dot plotting more rate hikes to come:

    After all the Fed has hiked 5 times off the bottom floor in the past 2 years:

    Can we see any measurable impact? You bet we can.

    Here are personal interest payments for consumers:

    Mind you we are still near the lows of the previous cycle and already total interest payments are near record highs.

    The driver of course is record consumer debt and credit card debt (see also macro charts). But despite rates still being historically low this rise in interest rates has an impact on the consumer.

    Already we see this:

    “The big four US retail banks sustained a near 20 per cent jump in losses from credit cards in 2017, raising doubts about the ability of consumers to fuel economic expansion. “People are using their cards to get from pay cheque to pay cheque,” said Charles Peabody, managing director at the Washington-based investment group Compass Point. “There’s an underlying deterioration in the ability of the consumer to keep up with their debt service burden.” Recently disclosed results showed Citigroup, JPMorgan Chase, Bank of America and Wells Fargo took a combined $12.5bn hit from soured card loans last year, about $2bn more than a year ago.”

    I repeat: “There’s an underlying deterioration in the ability of the consumer to keep up with their debt service burden.”

    That’s a problem given the Fed’s dot plot. Before you know it consumers will be handing over a good portion of their tax cuts to credit card companies. Winning.

    Is the government carrying record debt immune to this? Nope.

    Here’s the latest monthly Treasury statement:

    Interest on debt alone was $32B for 1 month.

    During the same month the year prior it was $25B:

    That’s a 28% increase year over year. Perhaps the data is lumpy month to month, we’ll see confirmation in the next few months. But much of this US government debt has to be refinanced in the next few years, meaning it will be subject to much higher rates and the US needs to continue to add to its debt to keep itself financed..

    Indeed the recent tax cuts only exacerbate an already existing debt sale schedule:

    “Economists with Deutsche Bank expect the extra debt the Treasury must issue to fund President Donald Trump’s tax package and the amount of debt the Federal Reserve plans to redeem at maturity this year will bloat issuance to about $1tn in 2018. That’s up more than 50 per cent from a year earlier and, when coupled with a 30 per cent rise in the amount of corporate debt that’s due to mature, leaves questions of who the eventual buyer will be.

    A good question indeed.

    That’s a lot of debt issuance:

    Somebody has to buy it or the pain is real:

    “If demand for US fixed income doesn’t double over the coming years then US long rates will move higher, credit spreads will widen, the dollar will fall, and stocks will probably go down as foreigners move out of depreciating US assets,” Torsten Sløk, an economist with the bank, said.

    No, we can all pretend rising rates don’t have an impact, we can also pretend deficits don’t matter, and we can also pretend money grows on trees.

    But we can’t pretend interest payments aren’t rising. Because they are. Right now.

  • Tokyo Holds "First Ever" Missile Attack Drills

    Two months ago, we reported that Hawaii was restoring an air raid warning system that hadn’t been operational since the Cold War. Only this time, it’s due to the rising tensions between the US and North Korea…

    Indeed, these tensions nearly caused a panic last week when one employee at Hawaii’s Emergency Management Agency accidentally selected the wrong dropdown menu choice, broadcasting a “Ballistic Missile Threat” warning to the cellphones of Hawaii residents.

    On Monday, Tokyo activated the government’s “J-alert” system in a drill for the public to practice their response to a missile strike, RT reported. Once activated, the system warned people to “evacuate calmly inside a building or underground.”

    Video of the response showed people filing into a subway station…

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    Around 350 people participated in the first of its kind evacuation drill, which took place in Tokyo’s Bunkyo Ward, as well as a local amusement park. People sheltered in a nearby subway station and buildings, according to local media.

    Last year, North Korea memorably launched several moderate-range ballistic missiles over the Northern Japanese island of Hokkaido. 

     

    Tokyo

    However, the exercise made some Japanese people uncomfortable: A small group of protesters denounced the drills claiming they promoted Japanese militarism. One protester told the media that the exercises merely provided the illusion of safety – in the event of a nuclear strike, nobody in the blast zone would survive.

    Japan’s first-ever drills for the evacuation of Japanese civilians were conducted in March of last year in the coastal city of Oga. Japanese authorities have warned that a missile launched by North Korea could reach Japan in 10 minutes…

  • Las Vegas Update: Irregularities Cause Story Behind Massacre To Stink To High Heaven

    Authored by Jon Hall via Free Market Shooter blog,

    Months ago, I called for scrutiny amid a constantly-revolving news cycle concerning the Las Vegas massacre that occurred last October.

     

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    The victims of the Las Vegas massacre.

    64-year-old Stephen Paddock opened fire on a country music festival from the 32nd floor of the Mandalay Bay hotel, which overlooked the festival venue. Paddock’s onslaught left 58 dead and 546 injured.

     

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    Sadly, despite being the worst mass-shooting in U.S. history, the story has long since been abandoned by any traditional media outlets. A slow and ebbing trickle of developments have transpired despite the story dropping off of the radar…

    For instance, in late December, the chief of the FBI’s Las Vegas office, Aaron Rouse, revealed the agency likely wouldn’t brief the public concerning the massacre until their official report was released sometime around the one-year anniversary of the tragedy.

    Speaking with the Las Vegas Review-Journal, Rouse detailed:

    Paddock’s motivation has not been linked to any sort of affiliation or ideology, and evidence still suggests the gunman had no co-conspirators… FBI investigators have about 22,000 hours of surveillance and cellphone footage to comb through, along with about 250,000 separate photos… Local and federal authorities have to sift through about 40 terabytes of data.

    At the turn of the new year, it was revealed that Mandalay Bay staff – where Paddock had been staying – had at least 10 interactions with him during his stay.

    Paddock’s huge arsenal of guns and thousands of rounds of ammunition somehow wasn’t noticed throughout 10 interactions with hotel staff – an immediate answer is needed as to how.

    Court documents unsealed a week ago reveal that Marilou Danley, Paddock’s girlfriend, told authorities that they would likely find her fingerprints on some of the bullets used during the massacre because she helped Paddock load ammunition into magazines.

    Although claiming she had no prior knowledge of Paddock’s plans, Danley deleted her Facebook account at 2:46 a.m. on the night of the massacre, just hours after Paddock began firing at 10:08 p.m. 

    FBI agents also knew Paddock left behind caches of guns, ammunition, and explosives when they sought warrants before searching his properties. Oddities in Paddock’s online behavior were also noticed. As reported by Fox News:

    The documents said Paddock had received an email from a Gmail account in July encouraging him to try an AR-style rifle before buying one. “We have huge selection” in the Las Vegas area, the email allegedly noted.

    Paddock wrote back that he wanted to try several scopes and different types of ammunition. An email in response suggested trying a bump stock on the rifle with a 100-round magazine.

    Paddock’s email address and the Gmail address had similar names, leading investigators to suspect that he may have been emailing himself, although they couldn’t figure out why.

    Over the weekend, the trickle of developments continued, with Fox News revealing Paddock had child porn his computer… but last we knew, the hard drive to Paddock’s computer was missing.

    Furthermore, after months of claims and explanations by authorities that Paddock was a “lone gunman”, Fox5 of Las Vegas revealed that Metro Police confirmed they’re unable to release further details on the case because “there are still suspects being investigated”. 

    Even after months of being ignored by the mainstream media, the story still doesn’t add up.

     

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    The Las Vegas shooting investigation – with only four months of radio silence from authorities to show after the horrific incident and no clear answers – is still as murky as ever with no clear sign of when the veil will drop… if ever.

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Today’s News 22nd January 2018

  • In Shocking Interview, Macron Admits France Would Vote To Leave EU If Referendum Held

    When Marine Le Pen lost last year’s French presidential election to Emmanuel Macron in what appeared to be a landslide, the establishment breathed a sigh of relief because not only was the notorious Eurosceptic populist defeated, but also the wind appeared to be turning, and after a tumultuous 2016, 2017 started off with a bang for the unelected Eurocrats in Brussels. After all, the people had spoken and they wanted more Europe (and Euro), not less.

    Or maybe not.

    The French president sent shockwaves across Europe after he conceded that French voters would quit the EU if France held an in/out referendum on continued membership in the Brussels-led bloc. Not surprisingly no other EU country has risked putting membership of the bloc to a public vote since Britain shocked member-states by voting to leave the bloc in 2016, despite polls which showed virtually no possibility of such an outcome.

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    Macron admitting that he would lose a French EU membership referendum.

    In an interview with BBC’s Andrew Marr, Emmanuel Macron admitted that he would lose a French referendum on EU membership. Asked about the Brexit vote, the candid president told Marr:

    “I am not the one to judge or comment on the decision of your people.” But, he added “my interpretation is that a lot of the losers of globalisation suddenly decided it was no more for them.”

    Marr then pushed the French president, regarded by many as the EU’s new leader, on whether Britain’s decision was a one-off. Quoted by Express, the BBC journalist asked: “If France had had the same referendum, it might have had the same result?”

    Macron responded: “Yes, probably, probably. Yes. In a similar context. But we have a very different context in France” although he said he would not make it easy: “I wouldn’t take any bet though – I would have fought very hard to win.

    “My understanding is that middle classes and working classes and the oldest decided that the recent decades were not in their favor, and the adjustments made by the EU were not in their favour.”

    “I think the organization of EU went too far with freedom without cohesion, free markets without rules.”

    The French leader hit out at David Cameron for holding a referendum with a simple yes / no response on membership, instead of asking how to improve the situation.

    * * *

    Predictably, Twitter lit up after the interview was aired, with many questioning if the French leader had just admitted that he “does not listen to his own people” since he has refused to hold a referendum on the EU. For the sake of Europe’s unelected establishment, president Macron and the “European recovery”, one hopes we don’t find out any time soon…

  • New Trump Ad For Wall: Democrats "Complicit" In All Murders By Illegal Immigrants

    Hours after the government shutdown that the White House blamed on “obstructionist losers” who are holding government funding “hostage…over an unrelated immigration debate,” The Trump campaign posted an explosive new advertisement to the campaign website and YouTube channel on Saturday, featuring 37-year-old illegal immigrant Luis Bracamontes who killed two police deputies in 2014 after having been deported and returned to the U.S. multiple times.

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    Bracamontes showed no remorse in court proceedings which began in California last week – stating that his only regret was that he didn’t kill more police officers. His wife also faces charges in the killings.

    Along with the ad, the White House also issued a press release entitled:

    DEMOCRATS “COMPLICIT” IN ALL MURDERS BY ILLEGAL IMMIGRANTS

    Both the video and press release can be viewed below (emphasis added): 

    New York, NY – Hours after Senate Minority Leader Charles Schumer led Democrats to shut down the federal government, holding lawful citizens hostage over their demands for amnesty for illegal immigrants, Donald J. Trump for President, Inc. released a campaign ad calling out Democrats “who stand in our way” of progress and who are “complicit in every murder committed by illegal immigrants.”

    The ad, titled “Complicit,” profiles an illegal immigrant on trial for the murder of two Sacramento police officers who stated his “only regret” is that he “just killed two” and that he wished he “killed more.” It contrasts Democrats, who stand by those who commit acts of “pure evil,” versus President Trump, who was elected to build a wall to stop illegal immigration and keep American families safe.

    The Trump Campaign released the ad on the one-year anniversary of Donald Trump’s Inauguration as the 45th President of the United States. The powerful new ad reflects the stakes in the illegal immigration debate, and the reasons why the President will not allow the Schumer Shutdown to force his hand and grant amnesty for illegal immigrants.

    Donald Trump was elected President to build the wall and keep American families safe from evil, illegal immigrants who commit violent crimes against lawful U.S. citizens,” said Michael S. Glassner, Executive Director of Donald J. Trump for President, Inc. “Yet, one year after President Trump’s Inauguration, Chuck Schumer and the Democrats continue to put the interests of illegal immigrants over those of Americans. Our new campaign ad draws attention to the stark contrast between ‘complicit’ Democrats and the President for his full commitment to build a wall and fix our border to protect Americans from drugs, murder and other atrocities,” he concluded.

     

  • "Make Trade, Not War" Is China's Daring Plan In The Middle East

    Authored by Pepe Escobar via The Asia Times,

    Under the Belt and Road Initiative, Beijing aims to connect western China to the eastern Mediterranean…

     

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    China’s “Go West” strategy was brought into sharp focus at a forum in Shanghai last weekend. Billed as the Belt and Road Initiative: Towards Greater Cooperation between China and the Middle East, it highlighted key aspects of Beijing’s wider plan.

    The New Silk Roads, or the Belt and Road Initiative, involve six key economic corridors, connecting Asia, the Middle East, North Africa and Europe. One, in particular, extends through the Middle East to North Africa. This is where the Belt and Road meets MENA or the Middle East and North Africa.

    Of course, Beijing’s massive economic project goes way beyond merely exporting China’s excess production capacity. That is part of the plan, along with building selected industrial bases in MENA countries by using technical and production expertise from the world’s second-largest economy.

    Again, this is will connect western China to the eastern Mediterranean. It will mean developing a corridor through projects such as the Red Med railway. There are also plans to expand ports, such as Oman’s Duqm, as well as substantial investment in Turkey.

     

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    Belt and Road Initiative. Illustration: iStock

    A look at the numbers tells a significant part of the story. In 2010, China-Arab trade was worth US$145 billion. By 2014, it had reached $250 billion and rising. China is now the largest exporter to assorted MENA nations, while MENA accounts for 40% of Beijing’s oil imports.

    The next stage surrounding energy will be the implementation of a maze of LNG, or liquefied natural gas, pipelines, power grids, power plants and even green projects, sprouting up across the new Silk Road corridors and transit routes.

    According to the Asian Development Bank, the myriad of Belt and Road infrastructure projects for the next 15 years could hit a staggering $26 trillion. Other less grandiose figures come in at $8 trillion during the next two decades.

    The ongoing internationalization of the yuan will be key in the process as will the role of the Asia Infrastructure Investment Bank (AIIB).

    Naturally, there will be challenges. Belt and Road Initiative projects will have to create local jobs, navigate complex public and private partnerships along with intractable geopolitical wobbles.

    Enseng Ho, a professor from the Asia Research Institute at the National University of Singapore, is one of an army of researchers studying how historical links will play an important role in this new configuration.

    An excellent example is the city of Yiwu in Zhejiang province. This has become a mecca for merchant pilgrims from Syria or east Africa and has profited the region, according to the Zhejiang provincial government.

    In a wider Middle East context, Beijing’s aim is to harness, discipline and profit from what can be considered an Industrialization 2.0 process. The aim is to help oil producers, such as Saudi Arabia and the rest of the Gulf states, diversify away from crude.

    There is also reconstruction projections elsewhere, with China deeply involved in the commercial renaissance of post-war Syria.

    As well as investing in its own future energy security, Beijing is keen to put together other long-term strategic investments.

    Remixing the centuries-old Chinese trade connections with the Islamic world fits into the Globalization 2.0 concept President Xi Jinping rolled out at last year’s World Economic Forum in the Swiss ski resort of Davos.

    But then, Beijing’s strategy is to avoid a geopolitical collision in the Middle East. Its aim is to: Make Trade, Not War.

    From the United States’ point of view, the National Security Strategy document highlighted how China and Russia are trying to shape a new geopolitical environment in the region, which contrasts sharply from Washington’s aims and interests.

    It pointed out that while Russia is trying to advance its position as the leading political and military power broker, China is pushing ahead with a “win, win” economic policy. In 2016, that was spelt out in Beijing’s first Arab Policy paper, with its emphasis on bilateral trade cooperation, joint development projects and military exchanges.

    Since geopolitical wobbles are never far below the surface in the Middle East, China has even suggested it would be willing to act as a mediator between intractable rivals Iran and Saudi Arabia.

    Indeed, diplomacy is a key card for Beijing, according to Zhao Tingyang, a noted philosopher, at the Chinese Academy of Social Sciences.

    In his 2006 paper, entitled Rethinking Empire from a Chinese Concept “All-Under-Heaven”, Zhao argued that the country show follow a principle of harmony based loosely on the Confucian notion of “all under heaven” or Tianxia in Mandarin.

    Confucius, one would imagine, would be pleased by the Belt and Road Initiative. You could call it: “Make Trade, Not War All Under Heaven.”

  • "Brazen Plot To Exonerate Hillary Clinton" And Frame Trump Unraveling, Says Former Fed Prosecutor

    A former Federal Prosecutor sat down with The Daily Caller to give perhaps the most comprehensive rundown of the Obama Administration’s “brazen plot to exonerate Hillary Clinton” and “frame an incoming president with a false Russian conspiracy.” 

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    In this highly recommended 30 minute interview with Joe diGenova, the former Special Counsel who went after both the Teamsters and former NY Governor Elliot Spitzer, paints a very clear picture of collusion is painted between the Obama administration, the FBI, the Clinton campaign and opposition research firm Fusion GPS.

    From the Daily Caller:

    The FBI used to spy on Russians. This time they spied on us. what this story is about – a brazen plot to exonerate Hillary Clinton from a clear violation of the law with regard to the way she handled classified information with her classified server. Absolutely a crime, absolutely a felony. It’s about finding out why – as the Inspector General is doing at the department of justice – why Comey and the senior DOJ officials conducted a fake criminal investigation of Hillary Clinton. Followed none of the regular rules, gave her every break in the book, immunized all kinds of people, allowed the destruction of evidence, no grand jury, no subpoenas, no search warrant. That’s not an investigation, that’s a Potemkin village. It’s a farce. 

    And everybody knew it was a farce. The problem was, she didn’t win. And because she didn’t wain, the farce became a very serious opera. It wasn’t a comic opera anymore, it was a tragic opera. And she was going to be the focus. 

    What this is about, this is about a lavabo, a cleansing of FBI and the upper echelons of the Department of Justice. 

    We’re going to discover that the Attorney General, Loretta Lynch, her deputy Sally Yates, the head of the national security division John Carlin, Bruce Ohr and other senior DOJ officials, and regrettably, lying attorneys. People who were senior career civil servants violated the law, perhaps committed crimes, and covered up crimes by a presidential candidate – but more than that, they tried to frame an incoming president with a false Russian conspiracy that never existed, and they knew it, and they plotted to ruin him as a candidate and then destroy him as a president. That’s why this is important. That’s why connecting the dots is important. 

    DiGenova condemned the FBI for working so closely with the controversial Fusion GPS, a political hit squad paid by the DNC and Clinton campaign to create and spread the discredited Steele dossier about President Donald Trump. Without a justifiable law enforcement or national security reason, he says, the FBI “created false facts so that they could get surveillance warrants. Those are all crimes.” He adds, using official FISA-702 “queries” and surveillance was done “to create a false case against a candidate, and then a president.” –Daily Caller

    During the interview, DiGenova holds up and references a previously unreported and heavily redacted 99-page FISA court opinion from April, 2017, which “describes systematic and on-going violations of the law [by the FBI and their contractors using unauthorized disclosures of raw intelligence on Americans]. This is stunning stuff.” 

    NSA Admiral Mike Rodgers: An American Hero

    diGenova also discusses the immense risks taken by retiring NSA director, Mike Rogers – who briefed Trump on Nov. 7, 2016 about the Obama administration’s surveillance of the Trump team. The next day, the Presidental transition team was moved out of Trump tower and into the president-elect’s Bedminster, NJ golf course until they could sweep for bugs. 

    Uranium One and other matters

    Also discussed in the interview are the Uranium One scandal, Mueller’s “tainted” probe, and the consequences of the Democrats regaining control in the November midterms – which would most certainly lead to an effort to impeach Trump. 

    “It’s important for the House to complete its work now,” says diGenova. 

    * * *

    The 99-page FISA court opinion is below (link)

  • 200 Million Investors May Have Lost Everything In Largest Ponzi Scheme In China's History

    China has had its share of ponzi-like investment scheme blow ups in the past, most recently last April  as we described in “Investors Rage After 3 Billion Yuan Vanish From China’s Largest Private Bank” and previously in “Chinese Investors Find Out They Got Fleeced By A $7 Billion Ponzi Scheme.” But nothing quite like this, and no, it does not involve cryptocurrencies.

    According to the Asia Times, at the height of its business operations, online investment company, Qbao.com, had around 200 million registered users. With its “get rich quick” promises and tantalizing tales of up 80% returns, the company had a cult-like following with investors known as Baofen or fans of Qbao, not to mention potential clients clamoring to sign up for the financial firm’s products, leading to as many as 2 million new users every day in late 2017. Even the full name of the company, Qianbao, had the veneer of success, as it translates into “money treasure.

    Unfortunately for up to 200 millions ordinary Chinese, dreams of overnight riches became a nightmare when the founder of the site, Zhang Xiaolei, was placed in police custody after turning himself in just before the start of the new year.

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    Zhang Xiaolei, founder of Qbao.com, the online platform also known as Qianbao

    He has been accused of illegally raising 70 billion yuan or some $11 billion, according to sources close to the Chinese authorities and reported in the mainland media. If those allegations are true, this would be the largest online investment fraud in China’s history.

    “This shows the reality that many Chinese people are still short of money and are crazy for high-returning investment channels,” Li Chao, an analyst at market consultancy iResearch in Beijing, told the state-owned Global Times.

    So “crazy” that they risk losing it all; indeed, that looks nearly certain after Zhang walked into a police station on Dec. 26 in Nanjing, the capital of East China’s Jiangsu province, where Qbao.com was wheeled out in a blaze of publicity nearly eight years ago.

    The authorities believe investors may have become the victims of a giant Ponzi-type scam, where new clients ended up paying inflated returns to established customers without their knowledge.  Before the internet investment company was closed down, it was attracting nearly two million users every day in late 2017 from its headquarters in Shanghai.

    “Police are calling on Qbao investors in all regions to report to local public security authorities and cooperate in investigations after the company owner, Zhang Xiaolei, was [held] in custody for suspicion of an illegal fundraising crime,” the company said in a statement.

    Meanwhile, investors are in denial: many clients are convinced this is all a massive mistake, even though the online finance industry has been plagued by scandals, as Chinese regulators struggle to get grips with the problem.

    In February 2016, a leading online peer-to-peer lending service, Ezubao, was accused of swindling  more than 900,000 investors out of more than 50 billion yuan in less than two years. A court in Beijing later sentenced Ding Ning, the architect of the $9 billion Ezubao online financial fraud, to life imprisonment, which finally closed the chapter on one of the biggest Ponzi schemes in modern mainland history.

    But if the allegations concerning Qbao.com and Zhang are true, this could dwarf that case.

    “I became very tired of comforting other investors, some of whom were so anxious that they nearly killed themselves,” Mu Qing, who became a Baofen investor, told Global Times. “But we all trusted Qbao, and we will wait [to see what happens].”

    On Dec. 27, along with millions of other clients, Mu had his account on Qao.com frozen.

    What happens next depends on the Chinese police investigation and the decision by the central bank to launch an inqury. It has ordered all commercial banks in Jiangsu province to roll out internal inspections for potential loans linked to Qbao.com or its affiliated companies.

    “Qbao investors put all their trust in Zhang,” one former executive of the company told Caixin’s media website. “It was like a cult.

    But that “trust” has slowly turned to disdain and anger as the details of Zhang’s online world trickles into the public domain. In the end, the fall out could leave them broke in more ways than one.

    Of course, investor denial will eventually turn to acceptance, but first comes the anger stage, and if indeed 200 million Chinese may have lost a substantial portion, if not all, of their net worth, the anger will be tangible and could prove to be a true black swan for a country which – as we have profiled since early 2016 – has been teetering on the verge of social unrest.

  • Nomi Prins: "The Fed Is Scared To Death Of Crashing The Global Financial System"

    Via Greg Hunter’s USA Watchdog blog,

    Two time, best-selling author Nomi Prins says central bankers have no idea how to stop the easy money policies that they started after the financial meltdown of 2008.

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    Prins explains, “So, when the Fed says they are going to remove assets from their $4.5 trillion book by not reinvesting the interest payment…the reality is they haven’t really done that.  They have reduced their book by about $10 billion off of $4.5 trillion since they mentioned they were going to start ‘tapering.” 

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    The media discusses this as a major tightening move.  Somehow all of our economies have finally worked because of central bank activity.  Growth is real.  It’s all positive.  The markets are evidence of that because of the levels they are at; and, therefore, these central banks, starting with the Fed, are going to reverse course of these last 10 years. 

    “The reality is if you look at the actual activity of the central banks, beyond the Fed raising rates by a little bit, there hasn’t been and there isn’t being a reversal of course because they are scared to death that too much of a reversal is going to cause a major crash throughout the financial system.

    Everything is connected.  All the banks are connected.  Money flows around the world in less than nanoseconds, and all of it has the propensity to collapse if that carpet the central banks have created is dragged from beneath the floor of all this activity.

    Prins, who just finished traveling the globe to research her upcoming book, thinks there is one big thing that can take the entire system down. Prins, a former top Wall Street banker, contends:

    There hasn’t been any real growth in the real economy.  That is an indication of the misfire of this entire plan.  There has been tremendous growth in stock markets and bond markets. 

    If you look at localities or states or governments whose debt to GDP levels are well over 100%, in Japan it’s over 200%, in the United States it over 100%, and this is the same throughout the world.  These are levels that they have never been, and they are all at their historic highs. 

    That’s why debt will ultimately be the destructor of the system.  In order for that to happen, the cheapness of money that allow states, municipalities and corporations to continue to borrow at these cheap levels has to go away…

    At some point, there will be a mistake.  There might be a tiny smidge of an interest rate hike at some central bank, probably the Fed, which ripples throughout the system as a mistake, not because real growth has happened, and that’s why interest rates have been raised.  That will incur defaults throughout the system.  People will incur personal defaults, and that will cause problems in the mortgage market… then it becomes a knock-on credit crisis, and then banks start not to lend… Then we have the makings of a broad crisis.”

    Prins doesn’t think we get a crash in 2018, but warns when the markets crash, “they will come down fast.”

    So, how is Prins protecting herself?

    Prins says,

    I’m buying gold… I would also be a buyer of silver because silver is a used hard asset, and it’s at really cheap levels right now.  I would be a buyer as a percentage of my portfolio.  I have done exactly what I am telling you is a good idea to do, which is to take money from the stock market and put it into hard assets.

    Join Greg Hunter as he goes One-on-One with Nomi Prins, author of the upcoming book titled “Collusion: How Central Bankers Rigged the World.”

    *  *  *

    After the Interview:

    You can find free information and analysis from Nomi Prins at NomiPrins.com. Prins is giving USAWatchdog.com viewers a special link to buy her new book at a hefty discount. 

    Prins says this pre-order link will give USAWatchdog.com buyers of “Collusion: How Central Bankers Rigged the World” a 40% discount up until it officially releases on May 1, 2018.

  • No Deal: Government Shutdown To Continue For 3rd Day As Senate Sets Monday Noon Vote

    Any hope that the 2-day government shutdown could be suddenly resolved with an early morning vote on Monday morning died moments ago when Chuck Schumer said “there is no deal” while Senate Majority Leader Mitch McConnell said he is canceling the previously scheduled 1am procedural vote and instead the Senate will vote on the stopgap spending bill at noon Eastern on Monday, with the government set to remain closed at least until the vote.

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    McConnell also said that his intention is to resolve several issues including immigration as quickly as possible, and to move to DACA on Feb. 8 if no deal has been done by then and govt stays open.

    Meanwhile, the Senate Democratic Leader Chuck Schumer, objecting to earlier vote timing, said “we have yet to reach an agreement on path forward.”

    As discussed earlier, a flurry of activity on Capitol Hill had stoked hopes that a deal to end the shutdown might be reached before furloughs for hundreds of thousands of government workers kick in on Monday. Instead, the Senate is now set to vote at noon on Monday to end debate on a measure that would fund the government through Feb. 8.

    Furthermore, by the looks of things…

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    … this shutdown may indeed continue “for weeks” as Goldman predicted on Friday. And while the market may not care for now, should the funding gap extend into late February and early March, just days ahead of the debt ceiling X-Date, the S&P will – sooner or later – be reacquainted with gravity.

    Even on Monday, it remains unclear if there will be 60 votes to end debate, given opposition from Senate Democrats to the measure. And, as explained yesterday, without a drop in the stock market to “mediate” and force politicians to negotiate, the question now is how deeply the two sides will dig in further as the work week begins.

    Finally, for those wondering if there was any reaction in the market to the ongoing shutdown news, the answer: of course not.

     

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  • 15 Year Old Hacker Impersonated CIA Director And Other High Ranking Officials In Massive Data Breach

    A 15-year-old “hacktivist” who tricked AOL and Verizon customer support operators into believing he was then-CIA Director John Brennan, was able to crack into Brennan’s accounts and access highly sensitive documents concerning US military and intelligence operations in Afghanistan and Iran, a UK court has heard. 

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    Kane Gamble AKA “Cracka”

    Kane Gamble, now 18, was able to access Brennan’s emails, contacts, and his iCloud storage account after several successful attempts to manipulate information out of the call center employees. Brennan’s emails were sent to WikiLeaks and published on October 26, 2015.

    Gamble used similar “social engineering” techniques to gain accdess to former Secretary of Homeland Security Jeh Johnson, former Director of National Intelligence James Clapper, tricked the FBI helpdesk into believing he was then-Deputy Director Mark Giuliano.

    It was a common misconception that the group were hackers when in fact they used “social engineering” to gain access to emails, phones, computers and law enforcement portals.

    It involves manipulating people, invariably call centre or help desk staff, into permitting acts or divulging confidential information,” the prosecutor said. –Telegraph

    Gamble founded the five-man hacktivist group “Crackas With Attitude” (CWA) – telling a Journalist “It all started by me getting more and more annoyed about how corrupt and cold blooded the US Government are so I decided to do something about it.” The 15-year old then proceeded to unleash mayhem on his victims to “fuck the gov” according to court records, by taunting them online, downloading pornography onto their computers, and even taking control of their iPads and TV screens. 

    Gamble used similar techniques to hack the home broadband of Jeh Johnson, the Secretary of Homeland Security, and was able listened to [sic] his voicemails and send texts from his phone.

    He bombarded Mr Johnson and his wife with calls, asking her: “Am I scaring you?” and left messages threatening to “bang his daughter”, the court heard.

    Sometime in October, 2015, the 16-year-old Gamble convinced the FBI’s help desk that the was Deputy Director Mark Giuliano – pretending to be the former FBI boss while using information he had obtained after accessing the FBI’s Law Enforcement Enterprise Portal (Leap). From this access, Gamble gained intelligence and details of government employees and police officers. Gamble then bombarded Giuliano’s family and associates with calls, forcing them to post an armed guard at their home. 

    “This has to be the biggest hack, I have access to all the details the Feds use for background checks.” –Kane Gamble

    Gamble pleaded guilty to ten violations of the UK’s computer misuse act in October, 2017. Two Americans charged with participating in Crackas With Attitude -computer science student Justin Liverman and Andrew Boggs, both of North Carolina – were arrested in 2016 and sentenced to five and two years in prison respectively after pleading guilty to criminal hacking conspiracy. 

    Court documents filed in the cases against Boggs and Liverman allege they conspired with “Cracka” to infiltrate the internet accounts of several senior U.S. officials and their families, causing more than $1.5 million in losses.

    Gamble admitted to setting his sights on other U.S. government targets including former President Barack Obama’s deputy national security adviser, Avril Haines, and his senior science and technology adviser, John Holdren, local media reported.-Washington Times

    At one point, the FBI realized that their system had been breached and the password was changed, but Gamble was able to regain access by calling the FBI helpdesk as Mr. Giuliano. The young hactivist also used his access to sensitive information to post the personal details of officer Darren Wilson, who shot and killed black teenager Michael Brown in Ferguson Missouri. 

    Gamble’s eight month cracking spree came to and end in February, 2016 after he accessed the details of 20,000 FBI employees from the DOJ’s network, as well as files on the Deepwater Horizon oil spill. The FBI and US Secret Service immediately called police in the UK and Gamble was arrested at his Leicestershire home he shared with his mother. 

    Gamble awaits sentencing at yet to be determined date. 

  • Central Bank Of Russia Adds A Record 223 Tons Of Gold In 2017

    Submitted by Louis Cammarosano  of Smaulgld

    The Russian Central Bank added 300,000 ounces (9.3 tons) of gold to its reserves in December, bringing the total acquisitions of the precious metal in 2017 to a record 223 tons.

    Since June 2015, the Central Bank of Russia has added over 558 tons of gold, and December’s 9.3 ton addition brings the official Russian gold holdings to 1838.211 tons; the sixth most of any nation, close behind the People’s Bank of China. In dollar terms, Russia’s gold reserves are now worth $76.647 billion and constitute 17.7% of overall Russian reserves.

    Meanwhile, Russian holdings of U.S. Treasuries were just above $100 billion for eighth month in a row.

    The message – as Russia continues to add gold to its official reserves while keeping its holdings of US Treasurys generally unchanged – needs no explanation.

    asd

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Today’s News 21st January 2018

  • Republicans Have Four Easy Ways To #ReleaseTheMemo…Not Doing So Will Prove Them Shameless Frauds

    Authored by Glenn Greenwald and Jon Schwarz via The Intercept,

    One of the gravest and most damaging abuses of state power is to misuse surveillance authorities for political purposes. For that reason, The Intercept, from its inception, has focused extensively on these issues.

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    We therefore regard as inherently serious strident warnings from public officials alleging that the FBI and Department of Justice have abused their spying power for political purposes. 

    Social media this week has been flooded with inflammatory and quite dramatic claims now being made by congressional Republicans about a four-page memo alleging abuses of Foreign Intelligence Surveillance Act spying processes during the 2016 election. This memo, which remains secret, was reportedly written under the direction of the chair of the House Permanent Select Committee on Intelligence, GOP Rep. Devin Nunes, and has been read by dozens of members of Congress after the committee voted to make the memo available to all members of the House of Representatives to examine in a room specially designated for reviewing classified material.

    The rhetoric issuing from GOP members who read the memo is notably extreme.

    North Carolina Republican Rep. Mark Meadows, chair of the House Freedom Caucus, called the memo “troubling” and “shocking” and said, “Part of me wishes that I didn’t read it because I don’t want to believe that those kinds of things could be happening in this country that I call home and love so much.”

    GOP Rep. Scott Perry of Pennsylvania stated: “You think about, ‘Is this happening in America or is this the KGB?’ That’s how alarming it is.”

    This has led to a ferocious outcry on the right to “release the memo” – and presumably thereby prove that the Obama administration conducted unlawful surveillance on the Trump campaign and transition.

    https://www.zerohedge.com/sites/default/files/inline-images/20180120_memo1.jpg

    On Thursday night, Fox News host and stalwart Trump ally Sean Hannity claimed that the memo described “the systematic abuse of power, the weaponizing of those powerful tools of intelligence and the shredding of our Fourth Amendment constitutional rights.”

    Given the significance of this issue, it is absolutely true that the memo should be declassified and released to the public – and not just the memo itself. The House Intelligence Committee generally and Nunes specifically have a history of making unreliable and untrue claims (its report about Edward Snowden was full of falsehoods, as Bart Gellman amply documented, and prior claims from Nunes about “unmasking” have been discredited). Thus, mere assertions from Nunes — or anyone else — are largely worthless; Republicans should provide American citizens not merely with the memo they claim reveals pervasive criminality and abuse of power, but also with all of the evidence underlying its conclusions.

    President Donald Trump and congressional Republicans have the power, working together or separately, to immediately declassify all the relevant information. And if indeed the GOP’s explosive claims are accurate – if, as HPSCI member Steve King, R-Iowa, says, this is “worse than Watergate” — they obviously have every incentive to get it into the public’s hands as soon as possible. Indeed, one could argue that they have the duty to do so.

    On the other hand, if the GOP’s claims are false or significantly misleading – if they are, with the deepest cynicism imaginable, simply using these crucial issues to whip up their base or discredit the Mueller investigation, or exaggerating or making claims that lack any evidentiary support, or trying to have the best of all worlds by making explosive claims about the memo but never having to prove their truth – then they will either not release the memo or they will release it without any supporting documentation, making it impossible for Americans to judge its accuracy for themselves.

    Anyone who is genuinely concerned about the claims being made about eavesdropping abuses should understand why the issue of evidence is so critical. After all, the House, Senate, and FBI investigations into any Trump collusion with Russia have so far proceeded with many startling claims in the media, but to date little hard evidence for the public to judge. Nobody rational should be assuming any claims or assertions from partisan actors about the 2016 election are true without seeing evidence to substantiate those claims.

    The good news is there are at least four easy ways for congressional Republicans and/or Trump to definitively prove that all the right’s darkest suspicions about the Obama administration are true. If this memo and the underlying documents prove even a fraction of what GOP politicians and media figures are claiming about them, then what could possibly justify its ongoing concealment? Any or all of these methods should be promptly invoked to ensure that the public sees this evidence:

    1. Trump can declassify anything he wants.

    All classification by the U.S. government has no basis in laws passed by Congress (with one tiny exception that is irrelevant here). Rather, all classification is based on presidential executive orders, which rely on the president’s constitutional role as commander in chief of the armed forces. According to the Supreme Court, the presidential power “to classify and control access to information bearing on national security … flows primarily from the constitutional investment of power in the president.”

    That means presidents can also declassify anything they chose to — for any reason or no reason — as they have done in the past. George W. Bush, under pressure in 2004, declassified the section of the 2001 presidential daily brief headlined “Bin Laden Determined to Strike in U.S.” Barack Obama declassified the Justice Department memos produced during the Bush presidency on the legality of torture.

    Thus if the House Intelligence Committee merely releases a version of its memo without the supporting documentation, that won’t be just because they don’t want Americans to see it – it will be because Trump doesn’t want us to see it either. Note that GOP House members are insistent that releasing the memo and the underlying source material would not remotely harm national security:

     

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

     

    So what possible justification is there for Trump to continue to conceal this alleged evidence of massive criminality from the American people by hiding it behind “classified” designations? Indeed, it is illegal to abuse classified designations to hide evidence of official criminality: so not only can Trump declassify such evidence, one could argue that he must, or at least should.

    2. The House (and Senate) intelligence committees can declassify any material they possess.

    According to the procedural rules of both houses of Congress, their intelligence committees can declassify material in their possession if the committee votes that such declassification would be in the public interest. It is then declassified after five days unless the president formally objects. If the president does object, the full chamber votes on the question.

    It is true that – in a measure of how embarrassingly deferential Congress is to the executive branch – neither the House nor the Senate intelligence committees has ever utilized this power, so it’s impossible to know how this gambit would play out in practice. But if Trump refused to release proof of the Obama administration’s misdeeds, congressional Republicans should have a straightforward way to overrule him.

    3. The Constitution protects members of Congress from prosecution for “any speech or debate in either House.”

    Members of Congress have legal immunity for acts they commit as part of the legislative process. Article I, Section 6, clause 1 of the Constitution states that “for any speech or debate in either House, [Senators and Representatives] shall not be questioned in any other place.” It is this constitutional shield that protected Sen. Mike Gravel of Alaska from legal consequences in 1971 when he read sections of the Pentagon Papers during a meeting of the Senate Subcommittee on Public Buildings and Grounds, and then placed the rest of the Pentagon Papers into the Congressional Record.

    It’s true that members could face legal consequences for ancillary acts — perhaps if they unlawfully removed the relevant material from the congressional SCIF. But they could go to the House floor and describe both the memo’s revelations and the underlying evidence for it without any fear of legal consequences.

    If the memo really proves what they claim, it would seem to be their patriotic duty would compel them do this. Ordinary citizens — like Daniel Ellsberg, Edward Snowden, and Chelsea Manning — have risked prison in order to expose what they believed were serious official crimes; these members of Congress can do this without any of those consequences. So what justifies their failure to do this?

    4. Republicans can leak everything to the news media.

    If for some reason Trump and the congressional leadership refuse to use any of the above options to vindicate themselves, a brave member of Congress could turn whistleblower and transmit the classified proof of the GOP’s claims about the memo to the news media.

    Many outlets now have secure methods of sending sensitive material to them, such as Secure Drop. Those for The Intercept can be found here. (All leaking entails risks, as we describe in our manual for whistleblowers.)

    *  *  *

    So that’s that. All Americans, particularly conservatives, should ask every Republican making spectacular assertions about this memo when they will be using the above ways to conclusively demonstrate that everything they’ve said is based in rock-solid fact.

    If they do not, Republicans will conclusively demonstrate something else.

    They will prove conclusively that all of this is about them shamelessly making claims they do not actually believe, fraudulently posturing as caring about one of the most vital, fundamental issues facing the United States: how the U.S. government uses the vast surveillance powers with which it has been vested.

  • Who's Going To Davos

    This year’s edition of the World Economic Forum begins on Tuesday in the Swiss mountain resort of Davos.

    According to the organizers, some 3,000 visitors will attend this year’s meeting.

    As our infographic shows most of them come from the United States.

    Infographic: Who's Going to Davos | Statista

    You will find more statistics at Statista

    Well with the government shut down… there’s no money to be made in ‘Murica!

    Perhaps even more ironically, Bloomberg reports that President Trump’s Davos trip is “day-to-day” during the government shutdown.

    Mick Mulvaney, director of the Office of Management and Budget, said at a press briefing on Saturday that a final decision hasn’t been made on whether Trump will travel as planned, given the federal government shutdown that began overnight.

    The president is expected to arrive at Davos on Jan. 25 and make a speech to the forum on Jan. 26.

  • Google Has An Actual Secret Speech Police

    Authored by Peter Hasson via The Daily Caller,

    More than 100 nongovernment organizations (NGOs) and government agencies around the world help police YouTube for extremist content, ranging from so-called hate speech to terrorist recruiting videos.

    All of them have confidentiality agreements barring Google, YouTube’s parent company, from revealing their participation to the public, a Google representative told The Daily Caller on Thursday.

    A handful of groups, including the Anti-Defamation League and No Hate Speech, a European organization focused on combatting intolerance, have chosen to go public with their participation in the program, but the vast majority have stayed hidden behind the confidentiality agreements. Most groups in the program don’t want to be publicly associated with it, according to the Google spokesperson, who spoke only on background.

    YouTube’s “Trusted Flaggers” program goes back to 2012, but the program has exploded in size in recent years amid a Google push to increase regulation of the content on its platforms, which followed pressure from advertisers. Fifty of the 113 program members joined in 2017 as YouTube stepped up its content policing, YouTube public policy director Juniper Downs told a Senate committee on Wednesday.

    The third-party groups work closely with YouTube’s employees to crack down on extremist content in two ways, Downs said and a Google spokesperson confirmed. First, they are equipped with digital tools allowing them to mass flag content for review by YouTube personnel. Second, the partner groups act as guides to YouTube’s content monitors and engineers who design the algorithms policing YouTube but may lack the expertise needed to tackle a given subject.

    It’s not just terrorist videos that Google is censoring. Jordan B. Peterson, a professor known for opposing political correctness, had one of his videos blocked in 28 countries earlier this month. A note sent to Peterson’s account said YouTube had “received a legal complaint” about the video and decided to block it.

     

     

    Peterson used his large social media following to push back, calling out YouTube on Twitter, where he has more than 300,000 followers. YouTube reversed Peterson’s block after another popular YouTuber, Ethan Klein, demanded an explanation on Twitter, where he has more than 1 million followers. Although the original notice said that YouTube was responding to a legal complaint, on Twitter the company gave the impression that the block was erroneous.

     

     

    The overwhelming majority of the content policing on Google and YouTube is carried out by algorithms. The algorithms make for an easy rebuttal against charges of political bias: it’s not us, it’s the algorithm. But algorithms are designed by people. As noted above, Google’s anonymous outside partners work closely with the internal experts designing the algorithms. This close collaboration has upsides, Google’s representatives say, pointing to advances in combatting terrorist propaganda on the platform. But it also provides little transparency, forcing users to take Google’s word that they’re being treated fairly.

    YouTube’s partnership with outside organizations to combat extremist content is just one part of the company’s efforts to prioritize certain kinds of content over others. YouTube also suppresses certain content through its “restricted” mode, which screens out videos not suitable for children or containing “potentially mature” content, as well as by demonetizing certain videos and channels, cutting off the financial stream to their operators.

    Prager University, a conservative nonprofit that makes educational videos, sued Google in October for both putting their content in restricted mode and demonetizing it. Prager faces an uphill battle in court (as a private company, Google isn’t bound by the First Amendment) but the lawsuit has forced Google to take public positions on its censorship.

    The Google representative who spoke with TheDC said that it is the algorithms that are responsible for placing videos in restricted mode. But in court documents reviewed by TheDC, Google’s lawyers argued otherwise. “Decisions about which videos fall into that category are often complicated and may involve difficult, subjective judgment calls,” they argued in documents filed on Dec. 29.

    In her testimony before the Senate committee on Wednesday, Downs described some of the steps Google has taken to suppress “offensive” or “inflammatory” content that falls short of actual violent extremism.

    “Some borderline videos, such as those containing inflammatory religious or supremacist content without a direct call to violence or a primary purpose of inciting hatred, may not cross these lines for removal. But we understand that these videos may be offensive to many and have developed a new treatment for them,” she said.

    “Identified borderline content will remain on YouTube behind an interstitial, won’t be recommended, won’t be monetized, and won’t have key features including comments, suggested videos, and likes. Initial uses have been positive and have shown a substantial reduction in watch time of those videos,” she added.

    YouTube’s demonetization push, which is affecting some of the most popular non-leftist political channels, is meant to accommodate advertisers who seek to avoid controversial content, the Google spokesperson said.

    Dave Rubin, a popular YouTube host, has seen his videos repeatedly demonetized. Rubin posted a video, “Socialism isn’t cool,” on Wednesday. The video was up a little over 24 hours before YouTube demonetized it on Thursday.

     

     

    The video was later remonetized, a Google representative told TheDC. But users can’t recoup the advertising dollars they lost while their videos were erroneously demonetized.

    I suspect that there is some political bent to it but I don’t think it’s necessarily a grand conspiracy against conservatives or anyone who’s not a leftist. Part of the problem is their lack of transparency has created a situation where none of use really know what’s going on,” Rubin told TheDC.

    “Does it seem that it is more so affecting non-leftist channels? Yeah, it does.”

  • Baltimore's Top Cop Fired After Out-Of-Control Homicides

    Baltimore’s top cop was fired Friday after a record year in per-capita homicides that has transformed Maryland’s largest city into one of the most dangerous areas in the United States.

    https://www.zerohedge.com/sites/default/files/inline-images/20180120_balt1.png

    To put things in perspective, Baltimore’s murder rate is 4x the average of other large cities and some 40 percent higher than Detroit. To make matters worse, Baltimore is now precisely tied with Venezuela, a country suffering from an economic collapse at 57.2 murders per 100,000 residents.

     

    https://www.zerohedge.com/sites/default/files/inline-images/20180120_balt2.jpg.png

    Mayor Catherine Pugh relieved Police Commissioner Kevin Davis of his duties after 2 1/2 years as top cop. Pugh, then announced that Deputy Commissioner Darryl DeSousa, who has been on the force for 30-years, will take Commissioner Kevin Davis‘ spot effective immediately.

     

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    “As I have made clear, reducing violence and restoring the confidence of our citizens in their police officers is my highest priority,” said Pugh.

    “The fact is, we are not achieving the pace of progress that our residents have every right to expect in the weeks since we ended what was nearly a record year for homicides in the City of Baltimore.”

    The fact the Pugh is achieving no progress at all should be disheartening to residents og Baltimore. The city closed out 2017 with 343 homicides, just shy of the 353 set back in 1993 when the city had 100,000 more residents. Last year, Baltimore hit a 100-year low in total population, as the city as a whole continues to shrink in size. On top of that, the city has experienced 50-years of failed Democratic leadership coupled with deindustrialization, which has turned the area into a war-zone. As shown below:

     

    https://www.zerohedge.com/sites/default/files/inline-images/20180120_balt3.jpg

    Ex-Police Commissioner Kevin Davis was the 39th Police Commissioner in Baltimore since 2015. Davis, a fourth generation public safety professional, has been relieved of his duties in total shame, however, the chart below might provide evidence that Baltimore’s demise was a much larger trend that no public official could contain. Hence, why Pugh had to call in the federal government for assistance in 2017.

     

    https://www.zerohedge.com/sites/default/files/inline-images/20180120_balt4.jpg

    Before Davis entered the top cop position, Baltimore was actually on a trajectory of being revived. All was well in charm city, as the millennials were singing the gentrifying tune with Kevin Plank. Johns Hopkins Hospital was gentrifying the eastern district of the town, and the University of Maryland was gentrifying the west side, the ole’ divide and conquer seemed to be working just fine.

    But something snapped in the city, right as Davis took the helm of the police force in 2015. Violent crime and homicides surged to levels not seen since the crack epidemic days of the late 1980s and early 1990s.

    So, what sparked the violent energy?

    Well, it was the Ferguson effect in 2014, which led to the Baltimore Riots in April of 2015. Community organizing groups from around the country sprinted into Baltimore and took advantage of the situation, as parts of the city burned to the ground. The governor called in the National Guard who shut down the city for one week with curfews and armed patrols.  It was argued by many, that Baltimore experienced some form of martial law in those 7-days of hell.  Nevertheless, the relationship between community and police evaporated, and that’s is when all hell broke out.

    Pugh is using Davis as a scapegoat to deflect the blame from City Hall. Davis was set up to fail at the start because the Ferguson effect blindsided the city. As soon as the relationship between community and police ended, the police scaled back on active policing. That is the moment the town entered into an irreversible death spin.

    A new police chief isn’t necessarily the answer unless there is a plan to restore the relationship between community and police, that community organized groups paid for by George Soros helped to destroy.

    The takedown of Baltimore has been a long-term trend, but as of recent, it was accelerated post-2015. As the city implodes on itself in 2018, the opioid crisis will be the needed energy to deliver the final death blow. As the city marches towards collapse, the likelihood of the firing of more top officials is strong for the remainder of the year.

    * * *

    To gain an understanding of what is next for Baltimore. Pay attention to the current developments in Sweden. Read: “Sweden Is Preparing For A “Civil War”: PM Wants To Deploy Army In No-Go Zones.

  • The FISA Memo Is All The Ammo Trump Needs To Take On The CIA

    Authored by Tom Luongo,

    FISA is an abomination. Let’s get that out of the way. And since I don’t believe there are any coincidences in U.S. or geo-politics, the releasing of the explosive four-page FISA memo after Congress reauthorized FISA is suspicious.

    Former NSA analyst (traitor? hero?) turned security state gadfly Edward Snowden came out in favor of President Trump vetoing the FISA reauthorization now that the full extent of what the statute is used for is known to members of the House Intelligence Committee, who are rightly aghast.

    Officials confirm there’s a secret report showing abuses of spy law Congress voted to reauthorize this week. If this memo had been known prior to the vote, FISA reauth would have failed. These abuses must be made public, and @realDonaldTrump should send the bill back with a veto. https://t.co/BEwJ9EyIq0

    — Edward Snowden (@Snowden) January 19, 2018

    But, like I said, timing in these things is everything. And the timing on this leak is important.

    Someone leaked this memo to the House Intelligence Committee with the sole intention of giving President Trump the opportunity to do exactly what Snowden is arguing for.

    And well Trump should. 

    This is the essence of draining the swamp.  It is the essence of his war with the Shadow Government.  If one makes the distinction between the Deep State and the Shadow Government, like former CIA officer Kevin Shipp does, then this falls right in line with Trump’s goals in cleaning up the rot and corruption in the U.S. government.  In a recent interview with Greg Hunter at USAWatchdog.com,

    Shipp explains, “I differentiate between the ‘Deep State’ and the shadow government. The shadow government are the secret intelligence agencies that have such power and secrecy that they act even without the knowledge of Congress. There are many things that they do with impunity. Then there is the ‘Deep State,’ which is the military industrial complex, all of the industrial corporations and their lobbyists, and they have all the money, power and greed that give all the money to the Senators and Congressmen. So, they are connected, but they are really two different entities. It is the shadow government . . . specifically, the CIA, that is going after Donald Trump. It is terrified that some of its dealings are going to be exposed. If they are, it could jeopardize the entire organization.” [emphasis mine]

    Court the Military Against the Spooks

    And as I’ve talked about at length, I’ve felt from the moment Trump was elected he was going to have to ally himself with the U.S. military to have any chance of surviving, let alone achieve his political goals.

    Trump’s final campaign ad was a clarion call to action.  It was a declaration of war against both the Shadow Government and the Deep State.  And it ensured that if he won, which he did, they would immediately go to war with him.

    And you don’t declare war like this if you aren’t prepared for the biggest knock-down, drag-out street brawl of all time.  If you aren’t prepared for it, don’t say it.  And for the past year we’ve been left wondering whether Trump was 1) prepared for it 2) capable of pulling it off.

    Trump’s continued needling of the establishment; playing the long game and demonizing the media which is the tip of the Shadow Government’s spear while strengthening the support of both the military (through his backing them at every turn) and his base by assisting them destroy the false narratives of globalism has been nothing short of amazing.

    As a hard-core, jaded politico, I can tell you I never thought for a second he had the ability to what he’s already done.  But, as the past few months have pointed out, the real power in the world doesn’t rest with the few thousand who manipulate the levers of power but the billions who for years stood by and let them.

    And those days of standing by are gone.

    So, Trump cozying up to the military, cutting a deal with the military-industrial complex (MIC) has the Deep State now incentivized to fight the Shadow Government for him.  The tax cut bill, while a brilliant example of political knife-fighting, is fundamentally about shoring up the finances of the corporations that make up the MIC through the repatriation of foreign-earned income, lowering the corporate tax rate and stealing even more of the middle class back from the Democrats.

    Trump had the right strategy from the beginning.  Civil Wars turn on what the police and the military do.  They are instigated by and fanned by the spooks, but it is the soldiers and the cops who decide the outcome.

    And so here we are.

    FISA, It’s Everywhere You Don’t Want it to Be

    Trump has called the Democrats’ and RINOs’ bluff on DACA and chain-immigration as a vote-buying scheme with zero political fallout.  He’s properly reframed the looming government shutdown on their inability to stick to their original agreements.

    His much-maligned Justice Department is now rolling up traitors associated with Uranium One, pedophiles and human traffickers all over the country and preparing for a showdown with blue state governors and attorney generals over “Sanctuary” grandstanding.

    By leading the charge, he gave strength to the patriots within both the Shadow Government and the Deep State organizations to leak the material needed to keep his campaign afloat.

    And as each new thing drops at the most inopportune time for the political establishment mentioned ad nauseum in that final campaign ad linked above, you have to wonder just how big the revolt inside these organizations is.

    Because, right here, right now, Trump can demand the release of this FISA memo and use it to torpedo the very thing that allowed the entire “Russia Hacked Muh Election” nonsense and send it back to the sh$&hole it was spawned from in the first place, the CIA and the DNC.

    And if that means for a few months the FISA courts are inoperable while a new bill and a new set of rules is drafted so be it.

    *  *  *

    Support work like this by subscribing to my Patreon Page where you can get access to the Gold Goats ‘n Guns Investment Newsletter for just $12/month.  

  • These Are The World's Real 'Shitholes'… Literally

    In many countries worldwide, there is still a chronic lack of toilets, driving people to defecate outdoors.

    In fact, as Statista’s Niall McCarthy notes, just under a billion people still practice open defecation across the globe and it’s a problem that results in widespread disease and millions of deaths.

    In 2015, the UN called for an end to open defecation by 2030 and some countries such as Vietnam have had considerable success eradicating it.

    Others are still struggling, however, as the following map clearly illustrates.

    Infographic: Nearly A Billion People Still Defecate Outdoors  | Statista

    You will find more statistics at Statista

    According to the most recent World Bank data which is from 2015, 40 percent of people in India still defecate outdoors.

    It is also common across Africa where the highest rates were recorded. Eritrea has the highest rate at 76 percent, followed by Niger (71 percent) and Chad (68 percent).

  • NSA "Sincerely Regrets" Deleting All Bush-Era Surveillance Data It Was Ordered To Preserve

    There is a growing consensus among many observers in Washington that the national security agencies have become completely politicized over the past seventeen years and are now pursuing selfish agendas that actually endanger what remains of American democracy.

    As Philip Giraldi notes, up until recently it has been habitual to refer to such activity as the Deep State, which is perhaps equivalent to the Establishment in that it includes financial services, the media, major foundations and constituencies, as well as lobbying groups, but we are now witnessing an evolutionary process in which the national security regime is exercising power independently.

    https://www.zerohedge.com/sites/default/files/inline-images/20180120_nsa.jpg

    Nowhere is that “independence” of the ‘state within a state’ more evident than in the blatant and egregious news this week that The National Security Agency destroyed surveillance data it pledged to preserve in connection with pending lawsuits and apparently never took some of the steps it told a federal court it had taken to make sure the information wasn’t destroyed, according to recent court filings.

    As Politico reports, the agency tells a federal judge that it is investigating and “sincerely regrets its failure.”

    Since 2007, the NSA has been under court orders to preserve data about certain of its surveillance efforts that came under legal attack following disclosures that President George W. Bush ordered warrantless wiretapping of international communications after the 2001 terrorist attacks on the U.S. In addition, the agency has made a series of representations in court over the years about how it is complying with its duties.

    However, the NSA told U.S. District Court Judge Jeffrey White in a filing on Thursday night and another little-noticed submission last year that the agency did not preserve the content of internet communications intercepted between 2001 and 2007 under the program Bush ordered. To make matters worse, backup tapes that might have mitigated the failure were erased in 2009, 2011 and 2016, the NSA said.

    “The NSA sincerely regrets its failure to prevent the deletion of this data,” NSA’s deputy director of capabilities, identified publicly as “Elizabeth B.,” wrote in a declaration filed in October.

    “NSA senior management is fully aware of this failure, and the Agency is committed to taking swift action to respond to the loss of this data.”

    Defiance of a court order can result in civil or criminal contempt charges, as well as sanctions against the party responsible. So far, no one involved appears to have asked White to impose any punishment or sanction on the NSA over the newly disclosed episodes, although the details of what happened are still emerging.

    “It’s really disappointing,” said David Greene, an attorney with the Electronic Frontier Foundation, which has been leading the prolonged litigation over the program in federal court in San Francisco.

    “The obligation’s been in place for a really long time now. … We had a major dust-up about it just a few years ago. This is definitely something that should’ve been found sooner.”

    Word of the NSA’s foul-up is emerging just as Congress has extended for six years the legal authority the agency uses for much of its surveillance work conducted through U.S. internet providers and tech firms.

    Antiwar activist Justin Raimondo believes that something like a civil war is coming, with the war party Establishment fighting to defend its privileged global order while many other Americans seek a return to normal nationhood with all that implies.

    If true, the next few years will see a major internal conflict that will determine what kind of country the United States will be.

  • Jeremy Grantham Exposes The Corporatocracy: America's "Run By Those Guys For Their Own Interests"

    Authored by Robert Huebscher via AdvisorPerspectives.com,

    Have profit margins risen to a permanently higher plateau? Are average Americans better off than they were a generation ago? I had the opportunity to discuss those questions, which are centrally important to investing and economic policy, with Jeremy Grantham a couple of weeks ago.

    The discussion took place as part of a larger interview about climate-change investing. Grantham is the co-founder and chief investment strategist of Boston-based Grantham Mayo Van Otterloo (GMO).

    It’s been widely reported that over the last 20 years the number of publicly traded companies has decreased by about 50%. The common explanations center on the fact that the number of de-listings, mergers, acquisitions and bankruptcies have outstripped the initial public offerings (IPOs).

    But I wanted to know if there was a deeper explanation related to the fact that corporate profit margins are at historical highs. Over the last dozen years, with the exception of the financial crisis, profit margins have been between 9% and 11% of GDP. Prior to that, the last time they were above 9% was in 1951.

    The U.S. economy has become more concentrated in the service and technology sectors, which are inherently more profitable than the manufacturing businesses that dominated 50 years ago. Those business, like Amazon, Apple and Google have built incredibly strong, near-monopolistic franchises that should translate to higher margins.

    If the market has become dominated with highly profitable, monopolistic franchises, then maybe that is why there are fewer companies and profit margins are no longer “the most mean-reverting series in finance,” as Grantham once claimed.

    GMO has looked at this issue extensively. As Grantham noted, “profit margins and return on sales will vary much depending on whether you are in the supermarket business or whether you are in some software company. There is no average to which it moves.”

    But that doesn’t necessarily mean that returns for equities will be greater going forward. As Grantham explained, higher margins will attract more capital and reduce the returns relative to other asset classes. “If your capital is returning more in this area than the other area then capital will flow and balance it out,” he said.

    Higher margins have been offered as an explanation, by Grantham and others, for why the cyclically adjusted price-earnings (CAPE) ratio is higher than its historical average. But CAPE ratios depend on other factors, such as real interest rates, so margins only tell part of the story.

    Grantham said that the monopoly factor has increased margins “a bit.”+

    “Corporate power as exercised through Congress, particularly in the U.S., has clearly increased the total domination of regulatory boards by the industries. Regulations have gone from being concerning to laughable, and totally run by those guys for their own interests,” he said.

    Grantham is far more concerned about the societal impacts of unchecked capitalism than he is with its effect on margins.

    “We are seeing a flowering of corporatism where government is designed to maximize the opportunities of giant influential companies and industries that spend a lot of money lobbying,” he said. “We continue down that primrose path today with yet another cycle of deregulating designed to help corporations.”

    Grantham spoke about the “punishing consequences” that tax cuts and deregulation will have on the general public. +

    He said that “maximizing the returns and the share of the pie going to corporations and the superrich is deplorable and has terrible effects on the economy in the long run. The average person in the street doesn’t have the buying power increments that they used to have.”

    American prosperity

    But is the average American really losing buying power? On this point, Grantham and I disagreed. Whether you go back 10, 20 or 40 years, I contend the standard of living for Americans has increased enormously.

    Grantham, however, said that in terms of general well-being and happiness, Americans are worse off.`

    “If you do your best to control for everything and measure happiness, this is not a particularly happy country,” Grantham said. “It is not entirely dependent on income by any means, and we have not improved.”

    He acknowledged a couple areas where Americans are better off – entertainment, such as high-tech computer games, and medicine, where he said progress in drugs and technology are keeping people alive longer. To those I would add food, in light of the advances in the quality and variety of choices in cuisine, and transportation, considering the speed and safety at which we can travel by car, plane and other means.

    But Grantham said that the average worker has not been paid more since 1974 for an hour’s work. “Does he feel more content, or does he feel extremely frustrated by his relative lack of progress compared to others?” he asked, rhetorically. “There is no doubt that he is more frustrated. The suicide rate in that group has gone way up. The drug addiction has gone way up.”

    Indeed, he said there are all the indications of a “thoroughly miserable middle America.”

    That is obvious from the suicide rate and the addiction rate, according to Grantham. He sympathizes with those who came from a world where one’s parents increased their annual wages by 3% or 4% real per year. Inflation-adjusted salaries have gone “dead flat” since the early 1970s, he said.

    “This has been a bitter disappointment,” Grantham said.

    I asked whether this could be the result of rhetoric from politicians and commentators who seek to amplify the fears of disadvantaged Americans. Grantham agreed that there has been a political background that encouraged – or even whipped up – disappointment.

    “But it is also clear that the reasons for being frustrated have not come out of thin air,” he said. “This is not the postwar boom where blue-collar workers make enough money to feel very pleased with themselves, and have their kids one way or the other go to college. This is not by any means as successful a society.”

    He pointed to some statistics that illustrate the lack of progress among Americans relative to other developed countries – more children are born to 16-year old girls, a higher murder rate, more people in prison (by a factor of three or four, he said), a higher rate of gun violence and lower life expectancies.

    But the data on life expectancy is not conclusive. Life expectancy at birth is less for Americans than for most developed countries, but after approximately age 35, U.S. life expectancy is indistinguishable from the others. The reason is that the murder rate in the U.S. is so high and most victims are younger than 35.

    Grantham countered that our infant mortality is 19th or 20th out of 20 developed counties and mothers who die in childbirth are very high compared to the others. He said that those rates have improved steadily, but that America pays the most for health care as a percentage of GDP, and we have worse outcomes than everyone except a couple of countries.

    But you can’t use life expectancy to claim that medical outcomes in the U.S. are worse than for other countries, unless you carefully adjust for our murder rate.

    I acknowledged that Americans pay more for medical care, but I contended that a better question to ask is whether all health-related government spending, including social services, is greater in the U.S. than for other developed countries. Those social services, including welfare, food stamps, and subsidized housing, contribute to better health outcomes in the same way as does healthcare. When you look at all health-related spending, the data for the U.S. is not that different than our peers (The major OECD countries on average spend about $1.70 on social services for each $1 on health services. But the US spends just 56 cents per health dollar – see here).

    The question of whether Americans get better outcomes for our healthcare dollars is significant, yet for most of us its relevance will be limited to cocktail-party conversations. But the larger question of how fast our standard of living is advancing has profound implications for economic policymakers. If our standard of living is improving faster than the published data indicates, then it means that inflation has been overstated. If inflation is overstated, then real growth rates and productivity are understated.

    Most importantly, this runs contrary to the claims by politicians and others about stagnating real wages.

    This is where Grantham and I had the sharpest difference. He said, “There is no question that GDP growth has slowed way down. Productivity has slowed way down and we have entered a low-growth world.” In his view, this has led to extreme income inequality and favoring of corporations.

    “Where it goes and how long it lasts, nobody knows. You would hope for a swinging back of the pendulum, and I would certainly hope, and to some extent I expect that that will occur in the not too distant future.”

    I agree that that income inequality has risen and corporations are more favored by government policy. But I am not persuaded that real growth rates in the U.S. are as low as Grantham fears, nor am I convinced that Americans are as bad off as he claims.

  • Video: Inside America's Deadly Opioid Crisis

    Opioids kill more people than they cure. Every day in the United States, some 140 people die from taking opioids – addictive opiate-based drugs. They’ve become the leading cause of death among the under-50s, ahead of road accidents and firearms. France24’s US correspondents, Valérie Defert, Baptiste Fenwick, Hayde Fitzpatrick and Romain Jany, take a look at the deadly opioid crisis.

    Opioids are neither viruses nor bacteria, but painkillers. In the United States, they are prescribed in abundance and are perfectly legal for a small injury or a tooth extraction. Opioids are analgesics, highly powerful painkillers, derived from opium. But many patients become addicted to the drug in just a few days and today this medication, which can cause fatal overdoses, actually kills more people than it cures.

    The death of celebrities such as Prince and Michael Jackson put the painkiller addiction epidemic in the spotlight, a scourge that permeates every US region and all social classes.

     

    https://www.zerohedge.com/sites/default/files/inline-images/20180120_opioid.jpg

    As soon as we began reporting, we became aware of the magnitude of the problem. Millions of patients have become addicted to opioids unintentionally, simply because their doctor prescribed them painkillers after an injury or an operation. Many people have played a role in this health scandal: the government and its agencies, influenced by pharmaceutical lobbies and unable to regulate themselves; the pharmaceutical companies, which concealed the danger of certain drugs, eyeing tens of billions of dollars in profits; and some unscrupulous doctors.

    The situation has been exacerbated by dangerous political decisions. A recent Washington Post investigation revealed that in April 2016, at the height of the opioid crisis, and under pressure from pharmaceutical lobbies, Congress passed a series of laws easing the rules on painkiller distribution.

    National health emergency

    Nevertheless, as soon as he came to power, Donald Trump vowed to act on this overdose epidemic. On October 26, 2017, he declared the opioid crisis a “national health emergency”. Many commentators believe Trump acted quickly to satisfy his electoral base, because those worst affected by the opioid crisis are white, middle-class Americans, living in the centre of the country. But several months after his announcement, nothing has changed, as the funds have still not been released.

    Another scandal was Donald Trump’s appointment of Tom Marino to deal with the opioid crisis. Marino is the Republican Congressman who was tasked with helping pass the laws that favoured the pharmaceutical industry in the first place.

    Finally, why did the US Food and Drug Administration (FDA) authorise the sale of opioids, such as Oxycontin in 1998, without conducting valid scientific tests? And amid the current addiction epidemic, why has the FDA decided not to ban this drug? After all, we now know that the Purdue Pharma laboratory concealed the addictive nature of these pills. It was even fined 600 million dollars, a record in the United States. We contacted the FDA, which claims to take the crisis “very seriously”. But no restrictions have been taken and Oxycontin is still prescribed today.

    After filming this report, it’s incredibly frustrating to realise that although everyone is talking about the crisis, nothing changes. Every day, thousands of Americans continue to put their lives in danger, without even knowing it.

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Today’s News 20th January 2018

  • "No Deal" – Government Shutdown Begins

    Update 12:03am ET: The shutdown has brgun.

    Per Reuters, the White House says it will reopen negotiations on immigration reform ‘when the Democrats start paying our armed forces and first responders’.

    * * *

    Update 10pm ET:

    *SENATE LACKS VOTES TO ADVANCE STOPGAP PLAN AS SHUTDOWN LOOMS

    The New York Times headline summed things up well: Senate Democrats Kill Bill to Keep Government Open Past Midnight

    Despite last minute ‘compromise’ meetings, and continued “hopes” from various sides, The Senate failed to reach the 60 votes necessary to keep the government funded (even for a stopgap) and so, as of midnight tonight, the government will shut down.

     

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    John Cornyn, the second-ranking Senate Republican, said the two parties haven’t yet found an agreement that would provide short-term funding for the government with a little more than two hours before the deadline.

    “No deal,” Cornyn said as the Senate prepared to take up a House-passed funding bill that Democrats have the votes to block.

    A group of lawmakers has been working on a plan for a three-week funding bill that would give Democrats and Republicans time to negotiate a long-term compromise on immigration, the chief sticking point in the spending fight.

    CNN’s Phil Mattingly explained on air: “Democrats aren’t looking for a reduction in time in the continuing resolution, they’re looking for substantive policy, commitments, changes or actual legislative text before they are willing to come on board with that.”

    This is what America will wake up to…

    https://www.zerohedge.com/sites/default/files/inline-images/20180119_shut3.jpg

    This is the 19th US government shutdown in the last 40 years…

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    President Trump tweeted before the vote:

     

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    While the blame-scaping may have begun days ago, tonight has already seen a full court press of finger-pointing.

    Sen. John Kennedy (R-La.) blasted Congress on Friday as a government funding deadline approached, slamming the government as being “run by idiots.”

    “Our country was founded by geniuses, but it’s being run by idiots,” Kennedy told reporters hours before the government was set to enter a shutdown.

    Lindsey Graham issued a statement suggesting a three-week compromise CR to Feb 8th:

     

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    The White House has estimated 1056 staff will be furloughed during the shutdown.

    EXECUTIVE OFFICE OF THE PRESIDENT

    Updated Contingency Plan For Shutdown Furlough

    A. Summary of Contingency Plan

    Should Congress not pass a Fiscal Year 2018 (“FY2018”) appropriation or continuing resolution (“CR”) by January 19, 2018, the Executive Office of the President (“EOP”) would be without authority to incur any financial obligations in FY2018, with very limited exceptions, and would therefore implement a contingency plan for shutdown furlough (the “Contingency Plan”). The Contingency Plan entails placing an estimated I 056 ofthe 1715 EOP staff in furlough status (“Non-Excepted Staff’), while an estimated 659 EOP staff would continue to report to duty because they are (i) designated as excepted to perform emergency or excepted functions; (ii) Presidentially Appointed, Senate Confirmed staff; (iii) otherwise exempt from the Anti-deficiency Act; (iv) alternatively funded during a government shutdown (collectively, the “Excepted Staff’). Any EOP personnel that are other government employees (“OGEs” or “Detailees”) would be furloughed or continue to report to duty at the discretion of their respective home agencies.

    B. Implementation of Contingency Plan

    Once it becomes clear that neither an appropriations bill nor a CR will be enacted prior to January 19, 2018, the White House Office of Management & Administration (“M&A”) will notify EOP components to begin an orderly shutdown of unfunded functions. Non-Excepted Staff will receive shutdown and furlough notices. Detailees will be notified by their home agencies whether they are to be furloughed.

    On Monday, January 22, 2018, Excepted Staff will report to duty. Non-Excepted Staff will also report on January 22, 2018, either in person or via telework for no longer than four hours and for the sole purpose of engaging in orderly shutdown activities. Each EOP component will issue instructions to their employees for orderly shutdown.

    C. Specifics of EOP Component Contingency Plan

    Each EOP component has carefully considered the number of personnel required not only to complete orderly shutdown activities but also to ensure that the emergency or excepted operations of each EOP component can be carried out during shutdown. The chart below summarizes component-by-component the Excepted Staff that will be required to sustain minimal emergency or excepted operations.

    https://www.zerohedge.com/sites/default/files/inline-images/20180119_shut1.jpg

    Federal employees will work without pay:

    https://www.zerohedge.com/sites/default/files/inline-images/20180119_shut4.jpg

    The question is – will government ever re-open? As Trump tweeted earlier, the Democrats want to shutdown to dim the success of the tax cuts; and as Goldman noted earlier, for every week of government shutdown, GDP growth will drop 0.2ppt.

    CNN is reporting that House Democrats plan a 10am meeting tomorrow to discuss a stopgap bill.

    The battle of the hashtags has begun – #RepublicanShutdown, #TrumpShutdown, or #SchumerShutdown.

    All of which distract from the only hashtag that really matters currently – #ReleaseTheMemo.

    *  *  *

    Update (6:20 pm ET): Democratic Sen. Heidi Heitkamp says she will vote for a 5-day stopgap plan being hashed out by a group of senate Republicans. While Mulvaney has expressed optimism that a deal will be reached within the next 24 hours, Mark Meadows, leader of the House Freedom Caucus of conservative Republicans, said the 5-day agreement is a nonstarter – Which an administration insider confirmed.

    Heitkamp represents North Dakota – a state where Trump won more than 60% of the vote in 2016 – and will be running for re-election in November. Her seat is viewed as vulnerable by some Republicans.

    According to the Washington Post, Heitkamp also supported the Republican plan for a one-month extension, as did Indiana’s Joe Donnelly and West Virginia Sen. Joe Manchin III. All three senators face a difficult path to reelection in heavily Republican states.

    Meanwhile, Mitch McConnell announced on the Senate floor that a procedural vote on the troubled 4-week extension has been scheduled for for 10 pm ET. Senate Democrats will meet at 8:30 pm ET.

    * * *

    Update (5:40 pm ET): OBM Director Mick Mulvaney says he “thinks there’ll be a deal in the next 24 hours.”

    Meanwhile, a White House aide said a proposed 5-day bill is a non-starter – echoing sentiments expressed by Freedom Caucus head Mark Meadows.

    * * *

    Update (5:20 pm ET): Trump tweeted that he had an “excellent” meeting with Schumer, and that he’s working with both Democratic leaders, as well as Paul Ryan and Mitch McConnell to hammer out a four-week extension.

     

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    * * *

    Update (2:40 pm ET): Schumer has left the White House meeting with Trump…

    He confirmed to reporters that “some progress” has been made, but that a deal has not yet been reached and “disagreements on several issues remain.”

     

    Nancy Pelosi says she believes a deal is “within reach.”

     

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    Steny Hoyer appears to agree:

     

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    Citing an anonymous source at the White House, ABC is reporting that talks will continue..

    * * *

    Update (2 pm ET): House Rules Committee Chairman Pete Sessions said the House will vote again tonight if Trump and Schumer manage to work out a separate deal.

    * * *

    Update: There is still no vote scheduled for the Senate, but that didn’t stop John Cornyn, the Republican No. 2 in the upper chamber, from telling reporters that he expects a vote to be held “after lunch.”

    Meanwhile, Mark Meadows, leader of the House Freedom Caucus, said he understands a proposal for a five-day short-term fix has been rejected by the House.

    According to the latest headline from the New York Times, Trump has invited Democratic leader Chuck Schumer to the White House t try and hammer out a last-minute deal.

    Schumer has reportedly accepted, and is on his way to the White House to meet with Trump, who is addressing a crowd of supporters at the March for Life from the Rose Garden.

    <a href="

    https://platform.twitter.com/widgets.js“>Fox News is reporting that Schumer has arrived at the White House.

     

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    Despite all of this, markets haven’t shown much of a reaction…

     

    * * *

    Update: Hardly a surprise, Mulvaney and Short arrived more than a half hour late, then proceeded to blast Democrats as obstructionists for trying to force a shutdown.

    They even have a name for it: “The Schumer Shutdown”.

    “This is an attempt by democrats led by Schumer – that’s why we’re calling it the Schumer shutdown – to embarrass the president,” Mulvaney said.

    “They don’t oppose anything in there. They support chip they don’t want the cadillac tax to go into place they’ve always supported clean CRs. And again, it worked in the House – there were several Democrats who voted for it,” Mulvaney.

    DACA doesn’t expire until March 5 – and therefore, doesn’t need to be dealt with until mid-February, Mulvaney said.

    Unlike the last shutdown in 2013, federal parks will be open, Mulvaney said. But all federal employees will be working for nothing (that is, until their back pay is approved by Congress). The military, TSA, Fannie Mae and Freddie Mac will also go to work, but they will not be paid.

    As of now, it looks like the federal government expects the shutdown to happen – though Mulvaney said their version of the shutdown would be more “moderate” than the previous shutdown, which happened during the Obama years. Mulvaney accused the Obama administration of “weaponizing” the shutdown by ensuring that virtually all federal employees didn’t show up for work. 

    While Mulvaney and Short were answering questions from the media, President Trump chimed in on twitter, chiding Democrats for opposing the bill. Trump blasted California Sen. Dianne Feinstein, tweeting a quote from her in the Washington Examiner: “Shutting down the government is a very serious thing…People die, accidents happen. I don’t know how I would vote right now on a CR, OK?”

     

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    * * *

    With the one-month stopgap spending bill stalled in the Senate, the White House is finally accepting the fact that there’s little it can do to prevent the government from shutting down at midnight on Friday.

    Trump has promised to remain in Washington – postponing a weekend trip to Mar-a-Lago – until the shutdown is averted or ended, and in order to keep the media apprised of what’s about the happen, the White House is holding a press conference at 10:30 am ET.

    Watch it live below:

    The press conference will feature White House Legislative Director Marc Short and OMB Director Mick Mulvaney, who only minutes ago warned that the odds of a shutdown were “50-50” – another way of saying “we have no idea what’s going to happen.”

    According to the Hill, Senate Majority Leader Mitch McConnell adjourned the Senate until 11 a.m. Friday without scheduling a vote on the House measure, giving lawmakers just 13 hours to reach a deal to avert a shutdown. McConnell has vowed to keep the Senate in session until an agreement is reached. Democrats are digging in their heels, demanding that they receive some concessions on DACA, opioids and funding for Puerto Rico before assenting to another short-term spending bill.

    One thing’s for certain: Don’t expect the steady stream of headlines to abate until late tonight…

     

  • Riz Virk Explains Why Quantum Physics, AI, & Eastern Mystics All Agree We Are Living In A Video Game

    Authored by Riz Virk via HackerNoon.com,

    An MIT trained computer scientist and Silicon Valley video game designer gives 10 reasons for the ‘Simulation Hypothesis’: that our reality is a simulated, pixelated 3d world where we all have individual xp, levels, and quests run by some giant Artificial Intelligence

    Recently, the idea that we may be living in a giant video game, or as it’s sometimes called, the Simulation Hypothesis, has gotten a lot of attention because of prominent figures like Elon Musk who have openly discussed the idea. As Virtual Reality technology has gotten more sophisticated, we are starting to contemplate virtual worlds like that of the omni-present Oasis in Ready Player One, soon to be a blockbuster movie directed by Stephen Spielberg.

    Some like sci fi writer Philip K. Dick, believed strongly that we were living in a kind of simulation. Others, like futurist Ray Kurzweil, have popularized the idea of downloading our consciousness into a silicon based device, which would mean we are just digital information after all. Some, like Oxford lecturer Nick Bostrom, goes further and thinks we may in fact be artificially simulated consciousness inside such a simulation already!

    Science Fiction Or Mysticism?

    Like my first exposure to most great ideas, I discovered the Simulation Hypothesis through watching and reading too much science fiction.

    The first time was during an episode of Star Trek: The Next Generation, where a holo-deck character realized that he was in a simulation and that some of the people in the simulation existed “out there” (in this case, out there was the rest of the Enterprise) and he wanted to go there, too! Was it possible that we were in a “holo-deck-like” space and that there was another world “out there”, I wondered?

     

    https://www.zerohedge.com/sites/default/files/inline-images/20180119_reality1.jpg

    A Star Trek character in the Holodeck realizes that he is in a simulation

    Although this was only a passing thought at the time, it wasn’t until the movie the Matrix was released in 1999 that the idea grew in the popular consciousness. It occurred to me then that this kind of simulation could exist with or without the alien overlords that make this a nightmare situation (in both the Matrix and Elon Musk’s version of the giant video game, there are also super-intelligent aliens behind the simulation).

     

    https://www.zerohedge.com/sites/default/files/inline-images/20180119_reality2.jpg

    The Matrix planted the idea in the popular consciousness that we are in a simulated reality

    As a computer scientist and video game designer, I have to admit that this idea is not really that crazy. A civilization that implemented an advanced simulation like ours might be many thousands (even millions) of years ahead of us; it’s not that hard to imagine such a civilization creating much more sophisticated games than we are capable of building today.

    As I started to study Quantum Physics and its startling revelations about the nature of “objective” vs. “subjective” reality, I started to wonder again about the idea of a giant multi-player video game. Moreover, as I delved more into the Eastern traditions, particularly Yogic and Buddhist philosophy, I found that their ideas about the nature of the world were actually pretty consistent with the idea that we are living in a simulation.

    Why Might This Be A Video Game After All

    Let’s delve into the top reasons why we may be living in a simulation after all:

    1. Pixels, Resolution, Virtual and Augmented Reality

    One of the main arguments that Musk makes is that a more advanced civilization will have games that are of very high resolution — so high that we would be unable to distinguish between the “real” world and a “simulated one”.

    Today we are already seeing with Virtual Reality that “full immersion” is possible. Anyone who has played a convincing VR game will realize that it’s possible to forget about the real world and “believe” the world you are seeing is real.

    As a great example, I was playing a prototype of a Ping Pong VR game last year (built by Free Range Games), and even though it wasn’t realistic resolution, I lost myself and thought I was playing ping pong for real. So much so that I set the paddle on the ping pong “table” and leaned against the table. Of course it was a VR table so it didn’t really exist — I ended up dropping the paddle (actually the Vive controller) onto the floor. As I leaned into the “table” I almost fell over before realizing that there was no table. In other words, to quote from the Matrix, there is no spoon.

     

    https://www.zerohedge.com/sites/default/files/inline-images/20180119_reality3.jpg

    In Ready Player One, a realistic immersive virtual reality world, Oasis, becomes the ultimate escape

    Imaging what kind of pixel resolution we might have in a hundred years, let alone in a thousand years! It could be pretty convincing. Also, as AR technology evolves to project onto the retina without needing external glasses, we could be seeing things around us that aren’t really there in a resolution that’s indistinguishable from the physical world. This brings up the idea that the world “out there” could really be just a projection in our minds.

    2. Pixels, Quanta, and Xeno’s Paradox.

    I recall late nights at MIT during my undergrad years where I had philosophical debates with my classmates about the nature of reality. This was the first time I’d heard of Xeno’s paradox. The idea was that if space was continuous, like numbers are (you can always find an infinite number of numbers in between any two numbers), how is it possible to touch an object such as the wall? You would always have to cover half the distance and neve get there.

    Xeno (or Zeno, whichever spelling you prefer!) related the paradox using the example of Achilles and a tortoise. If the tortoise was ahead of Achilles, how could he possibly ever catch it if he always had to make up “half the distance”?

     

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    When I first heard about this paradox, my initial reaction was that space must be quantized — there must be some minimum distance that we traverse. Later, I discovered that I wasn’t alone in this idea; whether this “minimum” amount is the Planck constant or some other amount isn’t as important as the idea that the physical universe, as we know it, may consists of pixels. Just like a video game! How many pixels are in the real world? To use a non-scientific term, a shitload.

    3. An Open World and the Illusion of Infinite Possibilities.

    Early video games were very linearly structured, such as space invaders or Pac-Man. There was a limited set of “motions” that were allowable using some “input” control, and there were specific objective as part of the each level, and you progressed linearly through the levels.

    As video games evolved and 3d models of a “world” became commonplace, video games took an evolutionary leap. It seemed from the player’s perspective that you could move around and do anything. Examples of open world video games range from GTA (Grand Theft Auto) and WOW (World of Warcraft), or the Sims, which simulated life and eventually Virtual Worlds like Second Life. Of course the idea that he world is infinite and that we can do “anything” inside the world is a carefully crafted illusion.

    Game designers know that’s not true. Using 3D modeling we can have a world that is generated and looks infinite but is really a set of maps and rules. In any game, no matter how “open” it appears, there are underlying tasks, or quests, or accomplishments, which are mapped out by the game designers. Is it possible that we have a similar illusion of “open-ness” in life?

     

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    Open World games like Second Life give the illusion of free choice

    4. The Collapse of the Probability Wave, Future Selves, and Parallel Universes

    In Quantum physics one of the most intriguing ideas is the probability matrix, which is an interpretation of how subatomic particles can exhibit properties of both a wave and a solid particle at the same time. At the level of an electron or a photon, the wave is interpreted as a set of probabilities of where the particle might be at any given time. When we observe a particular possibility, then the probability wave is said to “collapse” and we see a single particle in a particular location.

     

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    Probability wave of the location of a particle

    Some interpreters have taken this to the macro level to say that there are a set of probabilities in which we exist both in the present and in the future.

    Which of the possible paths do we follow? There isn’t a good explanation; how the probability wave collapses is one of the biggest mysteries in Quantum Physics. The best answer physicists have come up with is that consciousness somehow determines the collapse.

    Physicist Fred Alan Wolf, for example, says that information from these possible futures is coming to us in the present and that we send out an “offer wave” into the future, which is interacting with the “offer waves” coming from the future to the present. Which possible future we navigate to depends on which choices we make, and how these two waves super-pose on each other (or cancel each other out).

    These are startling results. Future probable selves are sending back information to the present, and we are consciously choosing which path to follow.

     

    https://www.zerohedge.com/sites/default/files/inline-images/20180119_reality7.jpeg

    Figure 1: Multiple Probable Futures Are Sending Us Back Information we use to make decisions.

    Another related aspect of Quantum Physics that sounds like science fiction is the Parallel Universes theory, where we branch into different “universes” when we make decisions. If that’s true, then there is a directed graph of multiple universes that are branching out each time we make a decision, resulting in different timelines (in fact, the parallel universes theory was put forward to solve the grandfather paradox of time travel).

    This reminded me of the very first video game I made back at MIT. The way that the computer chose the next move was to project the possible futures, and then use a certain algorithm to “rank” those futures, and then bring those values back to the present and then the AI would choose the path to follow.

    Did the possible futures we were calculating in our game actually exist? Or were they just probabilities? I realized that this isn’t too much different from what’s happening at the quantum level, except that in existing games like chess or checkers, we use a simple function (based on the rules of the game) to decide which of the paths is most optimal. We used the “minimax” algorithm in game design, trying to maximize our score and minimize our opponents score at each “turn of the future”.

     

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    The minimax algorithm: a simple AI for evaluating future outcomes and choosing hte best path

    In the Great Simulation of life, suppose there is another “function” which is ranking these possible futures, and we at some subconconscious level are choosing which of those possible futures and branches we may want to take from the present forward, just like in a video game!

    5. Observables and conditional rendering.

    When we have a 3d video game, we map out the world using 3d models. In some games, we allow user-generated content that stays in the world even after we log out of the gameplay session so that other players can see it.

    In video games, this “model” of the “world” exists outside of the character’s perception. In a trick meant for optimization, we don’t “render” the whole world on every single player’s computer. We only render the part of the world that the player is in, and then usually only for a certain point of view at a certain time. It would be impractical to render the entire world!

    Moreover, in 3d video games, there are techniques to optimize the rendering based upon what the player is looking at. These techniques were pioneered in first person shooters like Doom and now used heavily in VR headsets.

     

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    A philosophical question that comes up in both Quantum Physics and in Video Games is that if no one is in a particular part of the 3d world — i.e no one is observing it, or no player is there — does the particular possibility exist?

    Just like Schroedinger’s mysterious cat, which is neither dead nor alive until someone observes it, the world of video games relies on a player being logged in to render the world. If no one is logged into a particular room or a particular world, what state is it in? For example, what happens if there are no players logged into any of the servers of an MMORPG like World of Warcraft? The servers are running but nothing generally happens until a player logs in to observe what is going on, not unlike Quantum Physics.

    Spiritual and Mystical Traditions

    The next few reasons reflect interesting parallels between some of the spiritual and religious traditions, particularly the Eastern traditions and the Simulation Hypothesis. If you’re not into that, skip to reasons #9 and #10.

    6. The World is an Illusion.

    In many mystical traditions, particularly in Buddhism and Hinduism, we are told that the world around us is actually an illusion. Maya, the Sanskrit word for illusion, is used to describe the world we see, and Brahman, is the real world.

    In Buddhism, the idea is that to “wake up” you have to recognize that the world around us is an illusion. In fact the term “Buddha” means literally “awake”.

    In modern terms, they might just be describing a type of video game that we are all caught within, not unlike the HoloDeck from Star Trek. We are caught inside the illusory world, while there is a real world just beyond that we cannot normally perceive unless we “wake up”.

    In fact, there is a branch of Buddhist Yoga called Dream Yoga, which is used to help us “wake up”. In Dream Yoga, a form of lucid dreaming, participants are taught to realize that the dreams we go through at night are “simulated” experiences. By learning to recognize that we are in a simulation, we can “wake ourselves up”. The idea is that if we can do this in the “fake” worlds of dreams, so that we can do it in the “fake world” of real life — which is also a simulated reality!

    7. Multiple Lives, Points, Levels & Experience.

    According to many eastern traditions, we are actually going through multiple lives, gaining experience in each life and moving up to different levels of “evoluation”.

    In early video games like Pac Man or Space Invaders, each player also had a number of lives — the player accumulated points until the character was killed. The player could “continue” from the place they died, or could “start over” until the dreaded “GAME OVER” flashed on the screen.

    In MMORPGs, the player usually has a character which stores up a certain set of experiences between gameplay sessions (the character’s state).If we start over, the player of course remembers the skills they have gained in previous lives, but the character starts over with zero values in their state.

    This is analogous to how in some Buddhist traditions, when we are born, even though we retain the tendencies of previous lives, we cross the “river of forgetfulness” when we “start over”. In these traditions there is still someplace that we store all of our experiences and our points. Where? It’s not explicitly stated, but it sure sounds like they are uploaded to some kind of “cloud server”.

    https://www.zerohedge.com/sites/default/files/inline-images/20180119_reality10.jpeg

    In some traditions, we go through multiple lives on the wheel of re-incarnation. Sure sounds like a Video Game to me!

    Let’s look at Western religous traditions. As I was growing up in the Islamic tradition, I was told that there was “scorecard” that was being kept for us in this life — every good deed was recorded (“swab”) and every bad deed was recorded (“haram”) and depending on the score at the end of your life (and on Judgement Day, the day of Kyamath) you would go to either Junnath (Heaven) or Jahanam (Hell). In the Christian traditions, there is also the idea of the two angels on each shoulders and the idea of going to Heaven or Hell (with Purgatory thrown in for good measure). Again, we have the same idea: of a player game-state that is uploaded somewhere “outside” the rendered world.

    8. Quests, Karma and God-like AI

    In the eastern traditions, our experiences in life are not random; there is a system that is keeping track of what we think and do, and then creating situations in the world to deal with our past actions, called Karma.

    Now if you were going to design a seemingly open-ended game, a simulation that can track billions of players, you would need to keep track of quests and achievements for each person.

    In today’s video games, the quests/achievements/challenges are the same for each player. However, it’s not very difficult to envision a more sophisticated video game where quests were chosen based on the past experience of the player. And like in a particular level of a video game, the player could be confronted with similar challenges, again and again, until they are able to pass the challenge.

    To accomplish these kinds of “personalized quests” you would need to synchronize across a very large base of “players” and “NPC” or non-player characters (billions of concurrent players in the Great Simulation). You would also need to figure out which group of other players might be compatible, right now, in the moment, in a specific section of the 3d world, to a player’s quests. The result of each interaction in the game could have lasting consequences, leading to more challenges in the future.

    Some intelligence would need to keep track of billions of concurrent players (something we can’t do yet in any video game today). It would seem that an Artificial Intelligence system would be ideal for this kind of task. It may not even need to be that intelligent, as long as the rules were clearly defined and it could scale infinitely!

    Let’s move from the East to the West, to a more traditional religious framework. In these religions everyone prays to God. Let’s assume for a moment that God is real. What is God? What kind of intelligence, if it existed, could keep track of so many, billions of individual prayers and timelines? What could keep track of whether on judgement day, you are to go down to a deeper, less pleasant level (“Hell”) of hte game, or go to a higher, more pleasurable level (“Heaven”). You guessed it — an extremely sophisticated AI.

    Final Reasons

    Moving away from spiritual traditions, let’s come back to science for our final two reasons.

    9. Player Characters (PC) vs. Non-Player Characters (NPCs)

    Nick Bostrom, on the faculty at Oxford University, has long been a proponent of the simulation hypothesis. The argument that he makes is different — that civilizations are unlikely to survive and if they do, then they would have powerful computers that can do “ancestor” simulations. We are more likely, concludes Bostrom, simulated consciousness than actual biological beings. From his famous paper:

    One thing that later generations might do with their super-powerful computers is run detailed simulations of their forebears or of people like their forebears. Because their computers would be so powerful, they could run a great many such simulations. Suppose that these simulated people are conscious (as they would be if the simulations were sufficiently fine-grained and if a certain quite widely accepted position in the philosophy of mind is correct). Then it could be the case that the vast majority of minds like ours do not belong to the original race but rather to people simulated by the advanced descendants of an original race. It is then possible to argue that, if this were the case, we would be rational to think that we are likely among the simulated minds rather than among the original biological ones

    As a video game designer, this reminds me of our attempts to create realistic “NPC”s or non-player characters. As games have gotten more sophisticated, these AI characters have gotten more sophisticated. We may rapidly be approaching AI which can pass the Turing Test, which is an AI that is indistinguishable from a human being (if you were conversing with them).

    I recall early text games like Zork had players that would talk to you and attempts to make these characters realistic. AI has advanced well beyond that but we do not currently have NPCs which can pass the Turing Test. Once we do (in 10 years? In 100 years? In a thousand years), the possibility that people we are interacting with inside a simulation are NPCs goes up considerably. Professor Bostrom thinks that “we” are the simulated consciousness.

    10. Speed of Light, Wormholes, etc.

    It is curious that in our Universe, as far as we can tell, the fastest that we can travel from point A to point B is the speed of light. This also happens to be the speed of electrical systems and electromagnetic waves. In a normal video game, the fastest we would be able to send information from one player to the next would be over electrical wires. Why would the fastest we can travel through space be the same as the speed of electromagnetic waves, unless our idea of space was being generated by some form of electromagnetic wave?

    In the Virtual World of Second Life, if you try to go from point A to point B, you would be stuck traveling through the “space” of the game and would have to move slowly — whether you were walking or flying. On the other hand, you could instantly teleport to another part of the game at which point a different part of the 3d world will render around you.

    Do we also have this ability in real life? Some physicists have theorized wormholes, or Einstein-Rosen bridges, which would allow us to tear through the fabric of spacetime to shortcut the fabric of space and time. You could think of it as a backdoor — basically a teleport in video game terms.

     

    https://www.zerohedge.com/sites/default/files/inline-images/20180119_reality11.jpeg

    Wormholes allow us to get outside the 3d world to go from one place to another

     

    Conclusion

    These are just some of the reasons why we may be living in a Video Game after all, the Great Simulation. I haven’t even gotten into some of the more esoteric or psychological reasons (which would take a whole book unto itself).

    As computer science and artificial intelligence rapidly advance their capabilities, it may be possible to create a simulated world that looks and feels as real as our own. Video games, which started out with simple rules about what can be done and simple 2d worlds, have advanced rapidly into a MMORPG (massive multi-player online role playing games) with millions of players interacting in a simulated world. As computer technology advances, the chances of creating a billion player plus simulated world like our own is rapidly approaching.

    Moreover, Quantum Physics gives us a description of the univere (or multiple universes) that doesn’t make sense from the perspective of an “objective reality” but requires observation by some consciousness. These sometimes incredible findings defy common sense, unless we are living inside a video game rather than a physical reality and consciousness is the equivalent to us “logging into” the system.

    Eastern traditions, particularly Buddhist traditions, have long contended that we are living in world of illusion, and that we go through multiple lives trying to work out our individual quests, all of which are stored beyond the “rendered world”. There is a giant system that not only stores this but creates new situations for us to get our “achievements”. Sure sounds like a Video Game to me.

    All of these areas, Computer Science/Artificial Intelligence, Quantum Physics, and Eastern spiritual traditions point to one likely scenario: That we are living inside a very sophisticated Video Game, which I call The Great Simulation.

    Like all simulations, our world may only be real while the “simulation” is running.

    This reminds me of a quote from the British intellectual, Havelock Ellis, about dreams. He said:

    “Dreams are real while they last. Can we say any more of life?”

    Can we indeed??

  • Worldwide Approval Of America's Leadership Is Waning

    Donald Trump has been in power as the 45th President of the United States for a year, since his inauguration on January 20, 2017.

    The set-up of the international arena has long been shifting, away from lone American leadership towards a more multipolar world in which other powers are gaining influence, but as Statista’s Dyfed Loesche notes, Trump’s political agenda seems to be speeding up this process, as data by research institute Gallup on the approval of other nations’ of U.S. leadership suggests.

    Infographic: Worldwide Approval of America’s Leadership is Waning | Statista

    You will find more statistics at Statista

    Ever since the Second World War came to an end in 1945, the United States presided over the so-called “Pax Americana”, she had inherited the position of world leadership from Great Britain, who saw her long-standing predominance in the world dissolve together with her pre-war empire. This new set-up had its ups and downs, but brought with it a promise of stability during the Cold War stand-off with the Soviet Union, and even after the Berlin Wall fell in 1989.

    While the United States has always been willing and ready to wield her military might, the basis of her strong leadership position had to do with other nations accepting her as an agenda-setting hegemon. This order of things has been called into question from the outside, by emerging powers. Most notably China is challenging the status quo as she is constantly gathering economic and therefore political clout.

    But this process, it seems, is also being hastened from within the United States itself, by domestic politics. Since Donald Trump became president on an “America first” ticket, the world seems to become less accepting of America as a lead nation. There is a somewhat tragic, or at least ironic, ring to Trump’s often repeated vow to make “America great again”, as he might be the president who cements America’s fall from grace and power in the international arena.

  • London Sex Dungeon For Sale: Asking Price £3 Million

    Authored by Joel Golby via Vice.com,

    What else are you doing with your basement, come on…

    https://www.zerohedge.com/sites/default/files/inline-images/20180119_fuckdungeon1.jpg

    What is it? Oh we’ll get to that buddy…

    Where is it? Vauxhall, or: “This Gigantic Roundabout Got Too Horny”;

    What is there to do locally? I’ve been to Vauxhall two significant times in my life: once to see an under-the-arches musical about bathhouses which lurched from the surreal into the manic when Su Actual Pollard stood up at the end of it to lead the audience in a standing ovation, Su Pollard turning to the rest of us, roaring us to our feet to clap, all eyes on Pollard, Pollard furious, almost, with the clapping, Pollard replete in woven clothing inked in every neon colour beneath the sun, Su Pollard stalking Vauxhall like an apparition or a ghost; and ii. I went there this weekend, got drunk on a docked boat, lost on a building site and hit my head multiple times on a low ceiling before falling fully asleep in an Uber, passing out so entirely that my rating went down somewhere so low into the doldrums that I can no longer be picked up. So I suppose the answer to the question actually posed at the start of this is: anything you want, really, in Vauxhall. Anything your tiny mind can imagine.

    Alright, how much are they asking? In a rare zig from the format of “London Rental Opportunity of the Week,” this property is actually fully for sale, and will cost you £3 million. Three million pounds.

    What would you do if you were rich? Would you:

    1. Fill a swimming pool w/ champagne, luxuriate in it until you die—

    2. Turn your enormous mansion-surrounding garden into a sort of exquisite zoo, full of giraffes and rhinos and men in straw boaters handing out balloons, and free cotton candy, a sort of fantastic magical Disneyworld, all for you—

    3. Buy a football club, or an F1 team, or just eat at Nobu, like, every single night, fly first class, holiday in the Maldives, pay to have Richard Branson killed by the world’s most expensive hitman, anything you want, live in a fantasy world—

    4. Chain some lads to the floor of your basement and just Fuck. Them. To. Absolute. Bits. Mate.

    If you chose 4: correct, that is the correct choice to make.

    And may I also recommend to you this beautiful property in Vauxhall, which costs more than you will earn in your lifetime – more than you will earn in five lifetimes – which is tastefully decorated, gorgeously laid out, perfectly positioned (in Zone 1!), has both a conservatory and a spacious designer garden, modern luxuries throughout, and then also, should you choose to descend of an evening, it has an entire dungeon in it, dedicated to fucking:

    https://www.zerohedge.com/sites/default/files/inline-images/20180119_fuckdungeon2.jpg

    Like: look how perfectly arranged this sentence is:

    https://www.zerohedge.com/sites/default/files/inline-images/20180119_fuckdungeon6.jpg

    Additional street access… bwuahahaha.

    https://www.zerohedge.com/sites/default/files/inline-images/20180119_fuckdungeon3.jpg

    I have so many questions about the fuck dungeon, obviously, but mainly one pure and shining concern: that the Fuck Dungeon House not be sold to someone who will not maintain the dungeon of fuck. Some young family. You know, he works in the City and went to Oxford, she has a very successful interior design blog, they have a three-year-old called “Jessamyn” and they want to buy the fuck dungeon. “Yah, great space down here,” one of them is saying. “Maybe we could turn it into a nurs—” No. No. I forbid it. You keep it as a fuck dungeon. If you didn’t want a fuck dungeon in your house, why did you buy a house with a fuck dungeon in it? Exactly. For me, the fuck dungeon is a dealbreaker, the promise of its sanctity being the only condition of the sale. I fear a lot of things in this life, but some normie couple buying this fuck dungeon and turning it into anything that isn’t “a more complex and intense fuck dungeon” is highest among it.

    https://www.zerohedge.com/sites/default/files/inline-images/20180119_fuckdungeon4.jpg

    (Side note, but, like: some dudes have taken a real arseful in this place, and you can’t escape that. You cannot get that out of a room. You can’t paper over a vibe that musky and powerful with a bit of Farrow & Ball and some £200-a-roll wallpaper. Doesn’t matter if you crank a skylight into this thing and put a pool table in the middle. Some vibes cannot ever truly be aired out. No way a fuck dungeon, once converted into and then used as a fuck dungeon, can ever be anything other than a fuck dungeon. Some doors you cannot walk back on once you’ve been through them. Putting a fuck dungeon in the basement of your house is one of them.)

    https://www.zerohedge.com/sites/default/files/inline-images/20180119_fuckdungeon5_0.jpg

    Questions about the fuck dungeon, in no particular order:

    1. Once you have committed to putting a fuck dungeon in your house, how do you reverse out of that decision, i.e. by selling the house the fuck dungeon underpins? Like: does there come a time, in your life, when you look down the gloomy stairs at your fuck dungeon, hands on hips, and think: “This is a young man’s game. It’s not for me any more.”

    2. Are there specialist contractors who can install a fuck dungeon for you, or do you need to buy all the parts and just sort of put it together yourself?

    3. How often, once you’ve put a fuck dungeon in, do you actually fuck in a dungeon? A fuck dungeon always feels like a good idea, doesn’t it, and then eight months roll by and there’s dust on the shackles and you realise you haven’t been rimmed by a gimp for like two entire seasons. Not a perfect example, but one I’m going with nonetheless: I bought a Nintendo Switch in November. Really thought I’d use it more. Like: I love it, obviously. It’s great. Used it on the train. Mario Kart for Christmas. But now it’s there… some days, I just don’t play with it. I’ll look at it. I’ll think about it. And then I’ll go to sleep. I feel like this is very much what owning a fuck dungeon is like.

    4. The seller is trying to shift this £3 million townhouse via a free gmail address, namely dungeonhousevauxhall@gmail.com, and all this makes me think is: was dungeonhouse@gmail.com already taken? How many dungeon houses are there?

    5. Does the dungeon street access mean, and bear with me, that a pair of padlocked double-doors open out directly into the street, into which blinking pale nude boys can escape after a weekend of being rigorously fucked, searing beneath the flood of sunlight around them, and if so what are the neighbours like? Are they nice about that?

    I truly think Fuck Dungeon House has ruined all other houses for me. I’m going to go home tonight and just look at all the rooms and just be disappointed I can’t be pinned mechanically to the floor of them and shagged. Please – if you have £3 million spare, and you are exceptionally horny – please, please buy this house. Do this fuck dungeon the honour it deserves.

     

  • Alarming Rise In The Number Of Gun-Store Burgalaries Across America

    According to a new explosive report from the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), for the fifth consecutive year, the reported number of burglaries at gun stores across the United States is surging.

    https://www.zerohedge.com/sites/default/files/inline-images/20180119_gunstores2.jpg

    The ATF’s annual Federal Firearms Licensee Burglary and Robbery Statistics report released on Tuesday paints a troubling truth of organized crime gangs targeting gun stores.

    The statistics are shocking: the number of robberies of gun stores reported to the ATF have increased 227 percent since 2013 and burglaries rose 71 percent during the same period.

    The report found there were 577 gun store burglaries in 2017, an increase from 558 in 2016. “Since 2013, 27,685 guns were reported stolen in 2,315 burglaries from gun stores licensed by the federal government, including 7,841 guns last year,” said the Giffords Law Center.

     

    https://www.zerohedge.com/sites/default/files/inline-images/20180119_gunstores1.jpg

    The Giffords Law Center expresses concern how the federal law does not require gun dealers to follow a strict code for building security or securing storage of inventory.

    On the state level, some states like New Jersey have more stringent security requirements for gun shops, which has led to a decline in gun store robberies. According to the Giffords Law Center, “over the past five years in New Jersey, there have been just two reported burglaries with a total of three guns stolen.”

    David Chipman, senior policy advisor at Giffords, and a retired ATF Special Agent for two decades issued the following announcement:

    “Criminals know that gun stores can be easy targets to obtain armfuls of firearms in a matter of minutes. Every successful break-in opens a new threat to our community and puts law enforcement officers at risk.

    While we should all be alarmed and outraged that gun store burglaries increased for five years in a row, it’s important to remember that theft from gun stores is preventable — just look at what’s happening in New Jersey.

    When states require gun dealers to take responsible steps to prevent their stores from being burglarized — by properly securing not only their stores, but the firearms themselves — they eliminate the risk of thieves taking off with weapons. We know how to solve this problem, but we need more states to acknowledge this issue and put best practices for reducing gun store theft into action.”  

    A spokeswoman for the ATF provided a statement to Bloomberg about the manner, who said it is investigating into the data in order “to identify causation for the uptick in these types of crimes over the past five years.”

    Perhaps, our article titled “The Next Hurdle For Retailers,” could offer some insight into the ebb and flows of the flourishing organized crime networks in the United States. However, this week’s exposure of out of control gun store robberies is a telling sign that the organized crime networks are heavily arming themselves. The one question we ask: why?

  • Russia Accuses US Of Carving Out "Alternative Government" In Syria As Mattis Says No Longer Focusing On Terrorism

    Russia’s Foreign Minister Sergey Lavrov has accused the United States of working to carve out “an alternative government” on Syrian soil in statements made at a UN press briefing related to the recent Turkish military build-up poised to assault Syrian Kurdish areas of Northern Syria. Lavrov’s words come after Secretary of State Rex Tillerson pledged in a speech on Wednesday that US military forces would remain in Syria indefinitely until various objectives are met, which include Syrian government transition and the curtailing of Iran’s influence.

    Lavrov said “It’s a fact that US forces are seriously involved in creating alternative government bodies on vast part of the Syrian territory. And this, of course, absolutely contradicts their own obligations, which they committed to on numerous occasions, including at the UN Security Council, on maintaining the sovereignty and the territorial integrity on Syria.”

     

    asd
    Image via Anadolou News Agency

    The Russian FM further accused the US of contradicting its previous claim that US troops – which number at least 2,000 according to recent Pentagon statements – were only in Syria to fight the Islamic State and not wage a proxy war against the Syrian government and its allies.

    The prior US policy of regime change in Syria, which began under the Obama administration and intensified under a CIA program, was something many analysts perceived that President Trump had abandoned – consistent with earlier campaign promises. In the summer of last year Trump shut down the CIA program – widely reported to be the agency’s largest covert program – even while boosting support for the Pentagon program to arm and train the predominately Kurdish Syrian Democratic Forces (SDF).

    Rex Tillerson told me many times that the only reason for their presence there [in Syria] is defeating Islamic State (IS, formerly ISIS/ISL). Now they have some much more long-standing plans,” Lavrov said further of the inconsistency in US policy. “We will have to take this into account and look for solutions that won’t allow the destruction of Syrian sovereignty.”

    At the start of this week the Pentagon rolled out with deeply controversial plans for the US coalition in Syria to establish a 30,000-strong new border security force primarily utilizing the SDF, which many analysts see ultimately as a US commitment to the partitioning of Syria along ethnic and sectarian lines. And Russia has now issued a formal complaint alleging as much. 

    Meanwhile US Defense Secretary James Mattis unveiled a bit of a foreign policy 180 when in a speech on Friday he said that US national security focus was no longer terrorism, but “competition between great powers.” He said the US faced “growing threats from revisionist powers as different as China and Russia,” while unveiling a new national defense strategy.

  • The Pope's WW3 Warning: The World Is At "The Very Limit" Of Nuclear War

    Authored by Mac Slavo via SHTFplan.com,

    Pope Francis said this week he was really afraid of the danger of a nuclear war and that the world now stood at “the very limit.”  According to his comments, the world is one step away from a devastating nuclear war.

     

    https://www.zerohedge.com/sites/default/files/inline-images/20180119_pope.jpg

    The Pope made the comment as he flew off for a visit to Chile and Peru, and the statement comes just after Hawaii issued a false missile alert that provoked panic in the U.S. state and highlighted the risk of possible unintended nuclear war with North Korea. The mistaken alert underscored the risk of potentially entering an unintentional war with North Korea. Hawaii Democratic Representative Tulsi Gabbard said Sunday that the false alert shows the need for direct negotiations with North Korea.

    When asked if he was worried about the possibility of nuclear war, Pope Francis said:

    I think we are at the very limit. I am really afraid of this.

    One accident is enough to precipitate things.”

    Although the Pope did not specifically mention Hawaii or North Korea, he did say that stockpiling nuclear weapons is against the teaching of the Catholic church. According to One America News Network, Pope Francis has often discussed the danger of nuclear warfare. Back in November, the Pope appeared to harden the Catholic Church’s teaching against nuclear weapons, saying countries should not stockpile them even for the purpose of deterrence.

    As reporters boarded his plane bound for Chile, Vatican officials handed out a photograph taken in 1945 that shows a young Japanese boy carrying his dead brother on his shoulders following the U.S. nuclear attack on Nagasaki.

     

    https://www.zerohedge.com/sites/default/files/inline-images/20180119_pope1.jpg

    “I was moved when I saw this. The only thing I could think of adding were the words ‘the fruit of war’,” Pope Francis said, referring to a caption put on the back of the image.

    “I wanted to have it reprinted and distributed because an image like this can be more moving than a thousand words. That is why I wanted to share it with you,” he said.

  • Tax Reform And Trump's Chinese Trade Deficit Conundrum

    Authored by MN Gordon via EconomicPrism.com,

    Most things come easier said than done.  Take President Trump’s posture on trade with China…

    https://www.zerohedge.com/sites/default/files/inline-images/20180118_mng.png

    Trump doesn’t want a bigger trade deficit with China.  He wants a smaller trade deficit with China.  In fact, reducing the trade deficit with China is one of Trump’s promises to Make America Great Again.  In May 2016, he even told a campaign crowd:

    “We can’t continue to allow China to rape our country and that’s what they’re doing.  It’s the greatest theft in the history of the world.”

    Yet as Trump approaches the conclusion of his first year in office, he’s achieved the exact opposite of what he said.  The trade deficit with China hasn’t gotten smaller.  It has gotten bigger.  Actually, it has gotten a lot bigger.

    For example, the U.S. trade deficit with China from January through November 2017 was approximately $342 billion.  Over this same period in 2016, the trade deficit with China was $317.4 billion.  This amounts to a 7.7 percent widening of the U.S. trade deficit with China that has occurred on Trump’s watch.

    What gives?  Is China better at manipulating its currency than the U.S.?  Does China somehow outplay the U.S. when it comes to both trade strategy and strategery?

    Certainly, The Donald will get to the bottom of it…

    Unintended Consequences

    Earlier this week President Trump called up Chinese President Xi Jinping to have a frank phone conversation on the matter.  From what we gather, Trump “expressed disappointment that the United States’ trade deficit has continued to grow.”

    We don’t know what Jinping said in response.  But what he could’ve said was, “Donald, you ain’t seen nothin’ yet!”

    One of the unintended consequences of increasing the budget deficit to pay for the GOP tax reform bill is that it also increases the trade deficit.  In other words, the budget imbalance between taxes and government expenditures has a direct impact on foreign trade imbalances.  In an article published in Asia & the Pacific Policy Studies, economist Ralph W. Huenemann explains:

    “In 2016, the American government budgets carried a fiscal deficit of $865 billion, and the balance of payments showed a trade deficit of $521 billion.  A surplus of private savings (including substantial retained corporate profits) of about $344 billion over investment partially offset the budget deficit, but as long as there is such a massive deficit on government budgets, the net inflow of imports will continue.  This is inherent in the nature of national income.  No President, Donald Trump or any other, can change this reality without tackling the government budget deficit.

    So if Trump doesn’t want a trade deficit with China then he needs to reduce the government’s budget deficit.  However, reducing the government’s budget deficit is near impossible under the new GOP tax reform bill.  Hence, President Trump is left with a weak hand of bluster.

    Tax Reform and Trump’s Chinese Trade Deficit Conundrum

    This week Reuters released parts of its exclusive interview with President Trump.  On the prospect of a trade war with China, Trump remarked that he hopes a trade war won’t ensue, “But if there is, there is.”

    Trump also commented that any change in China’s purchases of U.S. Treasuries would not hurt the U.S. economy.  This is because, according to Trump, “everybody wants to buy Treasuries.”

    Let’s hope Trump knows what he’s talking about.  At the moment, China and Japan account for one-third of all foreign-held Treasuries.  However, China has currently tapered back its Treasury holdings to a four month low.  And Japan has reduced its Treasury holdings to a four year low.

    But maybe Trump’s right.  Maybe China and Japan don’t matter.  Maybe someone else – like the Swiss National Bank – will pick up the slack that’s needed to finance Trump’s deficit.

    Still, what would this get him?  It wouldn’t address his trade deficit conundrum; rather, it would make it worse.

    The point is attempting to spend a nation to prosperity using borrowed money is not without consequences.  In the short run, an illusion of wealth can be erected.  In the long run, the illusion slips into decay and disrepair at the precise moment the bill comes due.

    This is one of the tradeoffs of deficit spending based government stimulus that politicians fail to mention when promising free lunches.  Any economic boost that deficit financed tax reform delivers will be short-lived.

    Quite frankly, such a contrived economic boost is akin to burning one’s furniture to stay warm.  The heat it produces feels good while it lasts.  But once the furniture’s all burned up, it’s game over.

  • This Is How Chinese Bitcoin Buyers Are Getting Around The Government Ban

    China stunned cryptocurrency traders in September when, after announcing a crackdown on ICOs, it went a step further and warned all crypto exchanges operating in mainland China that they would need to wind down their operations by October – effectively killing the nascent cryptocurrency and blockchain industry.

    Observers expected this to be a huge blow…though Chinese trading volume had already fallen dramatically since January 2017 when authorities forced local exchanges to raise fees and implement AML controls, it was still a crucial market for bitcoin. However, the drop in Chinese trading didn’t stop the pioneering cryptocurrency from rocketing to an all-time high around $20,000 a few months later.

    As we noted at the time, several of the largest China-based exchanges, from OKCoin to Binance.com, and wallet services too sought a second life in friendlier Asian jurisdictions, applying for licenses in Japan – solo or via partners – setting up over-the-counter shops in Hong Kong, or laying the groundwork to operate from Singapore and South Korea.

     

    BTC

    But crypto enthusiasts living in mainland China can still transact domestically: But instead of these transactions being routed through exchanges, they’re negotiated on over-the-counter (OTC) trading platforms like Huobi, OKEx and OTCBTC, according to a Yahoo Finance  report.

    Of course, Chinese buyers who still want to participate in the market are doing so at significantly higher prices. On OTC platforms, prices are 10% to 20% higher than the prices on traditional exchanges. On Jan. 18, when bitcoin was trading at $11,730 on Coinbase, the biggest US brokerage, the lowest price on the Huobi OTC platform was 84,000 yuan, or $13,085.

    The premium that Chinese investors pay is a direct result of the limited OTC coin supply caused by government regulations. For more sophisticated traders, there’s an arbitrage opportunity: Traders will buy cryptocurrencies cheaply on foreign exchanges and immediately sell on domestic OTC platforms at a higher price. But there are risks, including price volatility, slow transaction times and China’s strict control on capital outflows.

    On platforms like OTCBTC, buying cryptocurrencies is like shopping on Ebay: choose the coin you want, then offers from multiple sellers appear. Buyers can link their bank accounts or use popular mobile payment methods like Alibaba’s Alipay or Tencent’s WeChat Pay. Once they get their hands on the coins, investors can trade them on any exchange in the world.

    OTC

    Chart showing number of daily transactions on OTCBTC

    As we highlighted in November,  several China-based trading platforms, including Huobi and OKEx, which were among the largest exchanges in the world and were included in the ban, decided to take advantage of a loophole: China hadn’t outlawed cryptocurrencies, it just outlawed the operation of exchanges. So, many of the companies that decided to stay soon opened OTC platforms and promoted their new operations by waiving transaction fees.

    According to  Yahoo Finance, while it’s hard to measure the exact size of OTC trading across all platforms, one single seller at Huobi recorded more than 10,000 separate bitcoin transactions in the past month. Another Taiwan-based platform, OTCBTC, which now offers more than 40 cryptocurrencies, boasted $100 million in transactions in the first 50 days after it launched last October.

    Meanwhile, Huobi and other Chinese companies are still operating crypto exchanges in friendlier, overseas markets.

    “Now our focus is the overseas expansion,” Huobi CEO Leon Li tells Yahoo Finance. “More than half of our newly-registered users are from outside China.”

    However, concerns about regulatory risks aren’t going away either. Huobi, for example, marks the reminder in red that buyers should not mention sensitive words like “BTC” or “bitcoin” in their bank transfers in order to reduce the likelihood of having the transaction blocked.

     

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Today’s News 19th January 2018

  • Army Major: "We're Killing These Kids, We're Breaking The Army!"

    Authored by Major Danny Sjursen via TheAmericanConservative.com,

    Our soldiers are still redeploying at a frenetic pace that cannot keep up with reality – and the cracks are showing…

     

    https://www.zerohedge.com/sites/default/files/inline-images/20180118_army.png

    I’ll admit I was taken aback. This senior officer and mentor – with nearly 28 years of military service – wasn’t one for hyperbole. No, he believed what he was saying to me just then.

    “We’re killing these kids, we’re breaking the army!” he exclaimed.

    He went on to explain the competing requirements for standard, conventional army units – to say nothing of the overstretched Special Forces – in 2018: balancing Russia in Eastern Europe, deterrence rotations in South Korea, advise and assist missions in Africa. Add to that deployments to the usual hotspots in Syria, Iraq, and Afghanistan.

    He was genuinely concerned about the physical and emotional toll on the active-duty force, pushed to its limits by 17 years of perpetual combat. After all, with high military suicide rates now labeled the “new normal,” and a recent succession of accidental training deaths, it seems reasonable to wonder whether we are, indeed, “killing [our] kids.”

    The overall effects of this rapid operations tempo on morale and readiness are difficult to measure in a disciplined, professional, all-volunteer military such as the one the United States possesses. What we do know is that despite former president Obama’s ongoing promises that “the tide of war is receding” and that America could finally “start nation-building at home,” nothing of the sort occurred then, or is now, under President Trump. Though the U.S. military (thankfully) no longer maintains six-figure troop counts in either Iraq or Afghanistan, American soldiers are still there, as well as serving in 70 percent of the world’s countries in one capacity or another in what has become a “generational war.” America’s troops are still being killed, though in admittedly fewer numbers. Nevertheless, U.S. servicemen continued to die in combat in several countries in 2017, including Syria, Iraq, Afghanistan, Somalia, Yemen, and Niger.

    After major drawdowns in Iraq (2011) and Afghanistan (2014), many soldiers, myself included, looked forward to longer “dwell time” at home stations and, just maybe, something resembling peace and even normalcy.

    It was not to be. Aside from deployments to Afghanistan, Iraq, and Syria, conventional U.S. Army brigades currently support regular overseas rotations to Kuwait, South Korea, and Eastern Europe. To use just one example, the 1st Armored Division webpage currently boasts that the division has soldiers supporting 20 missions on five continents. Of my three former classmates and colleagues in the West Point History Department (2014-2016), two are currently deployed: one in Romania, another to the ubiquitous Mid-East region. That’s just about as busy as we all were back in the bad old days of 2006-2007.

    The military – and the Army in particular – brought some of this upon itself. As conventional ground combat elements (of which the Army owns the preponderance) withdrew from Iraq and Afghanistan, and President Obama signaled a strategic pivot to Asia, U.S. Army leaders became understandably concerned. The Asia pivot would, logically, lean more heavily on the Air Force and Navy—especially when new military doctrine took the (exclusive) name “Air-Sea Battle.” As the economy struggled and budgets tightened, the various service chiefs fought to convince Congress and administration kingmakers of their continued “relevance.” If the Army didn’t appear busy—engaged in a countless number of vital missions—well, it’d be hard to justify its current budget.

    It should come as no surprise that around this time the Army touted the versatility of its Regionally Aligned Forces (RAF) brigades—units trained and tailored to support an array of missions for specific geographic combatant commanders. Army leaders also emphasized threats from Russia and North Korea and the need for deterrent brigades on the ground in those theaters. And, with Special Operations Command under strain, the Army also provided six new Security Force Assistance Brigades (SFABs) to carry some of the advise-and-assist workload around the globe. This is not to say that Army leaders fabricated threats or invented missions. It’s all far more complex. Rather, brutal budget squabbles on Capitol Hill combined with increasingly politicized foreign policy threat assessments created an atmosphere where demonstrating “relevance” and “busyness” presented the only sure path to funding at the rates to which the various services had become accustomed.

    Relevance is a double-edged sword—well-justified budgets require a frenzied operational pace and an overwrought Army.

    Some troopers, at least, appear fed up with the scope and pace of deployments in year 18 of the conflict formerly known as the “war on terror.” No one is publicly sounding the alarm, but there are signals—if you know where to look. When Vice President Mike Pence made a surprise holiday season visit to Kabul and publicly praised U.S. forces in Afghanistan, one observer described the crowd as “subdued,” and notedseveral troops stood with their arms crossed or their hands folded behind their backs and listened, but did not applaud.” Polls also demonstrate that although the current president is slightly more popular among the military than the general public, among officers Trump counts only a 30 percent approval rate. More concerning are the February 2017 polls indicating that military service member satisfaction has dropped 50 percent since 2009, due in part, one assumes, to never-ending deployments and time spent away from families. And, among the ever-strained Special Operations forces, reports indicate that mental distress and suicide are again on the rise.

    As it stands, the system just about holds together – no doubt due to the determination of leaders and dutiful sacrifice of soldiers – but one wonders whether the active component force could truly weather even one major regional crisis. Something, it seems, would have to give – a drawdown in other missions, compressed training schedules, or—heaven forbid!—calling up the reserves, something American politicians certainly wish to avoid.

    The all-volunteer force was always a devil’s bargain: by cutting out the citizenry in the form of a draft out of the equation, presidents, pols, and military leadership could move soldiers around the chessboard with fewer checks on their authority and the decision-making process.

    That’s all well and good, until the system cracks. The president’s modest troop escalations in Afghanistan and Iraq, if combined with a (ever more likely) shooting war in Korea, could be just the thing to “break” the professional, volunteer military.

    At that point Americans would have some tough decisions to make: ante up some cash and bodies to keep the U.S. military on top, or, just maybe, do less. Let’s hope it never comes to that. In the meantime, count on Congress and the American people to cover their eyes and let the “war on terror’s” third straight president run its cherished heroes into the ground.

    What a way to say “thanks for your service!”

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    Major Danny Sjursen is a U.S. Army officer and former history instructor at West Point. He served tours with reconnaissance units in Iraq and Afghanistan, and has written a memoir and critical analysis of the Iraq War, Ghost Riders of Baghdad: Soldiers, Civilians, and the Myth of the Surge

  • The State Of 'Freedom' Worldwide (According To Democratic Think-Tanks)

    Democratic watchdog organization Freedom House has released its annual ranking of the world’s most free and the world’s most suppressed nations. For the twelfth year in a row, global freedom has been found to have declined.

    As Staista’s Martin Armstrong notes, 71 countries experienced a decline in freedom with only 35 making a move in the right direction. Of the 195 countries assessed in 2017, 45 percent were rated as ‘free’, 30 percent as ‘partly free’, and 25 percent as ‘not free’.

    Infographic: The State of Freedom Worldwide | Statista

    You will find more statistics at Statista

    The United States, while still classed as ‘free’, saw a year-on.year decrease in its score, from 89/100 in 2016 to 86/100.

    According to Freedom House, this is mainly due to a fall in its political rights, citing “growing evidence of Russian interference in the 2016 election”, “violations of basic ethical standards by the new administration” and “a reduction in government transparency” as key factors.

    One wonders what a Republican Think Tank would ‘think’?

  • Is San Francisco Too Expensive For "San Francisco"-Based Startups?

    By Elissa Maercklein of Priceonomics

    Silicon Valley – the promised land of innovation, venture capital, and exorbitant costs of living. And many of the most valuable companies from the region, such as Square, Stripe, Airbnb, Uber are all based in the city of San Francisco.

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    Increasingly, however, it’s hard for startups to compete in the market for talent in the infamously expensive city of San Francisco.

    In March 2017, a blog post by Zapier CEO, Wade Foster, announced they would offer a $10,000 “De-Location Package” to employees that would move out of San Francisco. Fintech startup Varo Money announced in July that they plan to move their headquarters from San Francisco to Salt Lake City, citing high home prices among other reasons.

    We decided to analyze whether startups based in San Francisco actually had offices elsewhere as well. Are companies located in the city for fundraising and marketing purposes, but also creating offices in other cities and countries? Is this phenomenon limited later stage companies only or are early stage companies saving costs this way too?

    We took a look at the startups headquartered in San Francisco to determine if and when they expand to locations in other regions and where those regions are. Specifically, we pulled data on the 903 companies headquartered in San Francisco that have more than $5 million in funding from our Craft dataset of companies and their locations. 

    We found that 38% of San Francisco tech companies companies had locations elsewhere – with New York as the top U.S. city for an additional location and the U.K. as the top country for an additional location. Even for early stage startups (defined as raising $5-10MM in this analysis), 21% of San Francisco companies also had offices elsewhere. 

    ***

    For context, the table below shows the distribution of these startups in buckets based on total funding that we will use for this analysis.

    As one might expect, there are far more startups in SF with less than $50 million in funding than there are those with more than $500 million in funding. While many startups aspire to be the next Uber or Airbnb, the distribution is heavily skewed towards those with lower amounts of funding.

     

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    Data source: Craft

    To begin, we analyzed the distribution of companies that have solely their San Francisco location and those that have office locations outside of San Francisco. Of the 903 companies that fit our criteria, 339 startups (roughly 38%) have locations outside of San Francisco, which means that 564 of companies only have their primary SF office. See the companies with locations outside of San Francisco here.

    We then categorized companies by funding amount to see if there is a relationship between the amount of funding a startup has received and whether they have expanded to office locations outside of San Francisco. Our hypothesis was that companies with more funding have more capabilities to expand into new and potentially lower cost locations but we wanted to see if smaller, earlier-stage companies also had offices elsewhere. The graphical display of these two distributions clearly show that as the funding amount increases, the percentage of companies that have office locations outside of San Francisco increases, while the inverse (companies with only their San Francisco location) decreases.

     

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    Data source: Craft

    The graph below shows a clear trend that companies with higher amounts of funding have locations outside of their primary headquarters in San Francisco. As companies grow, they definitely have offices outside of San Francisco but it’s important to note here that even a significant portion of smaller companies have locations elsewhere.

     

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    Data source: Craft

     

    Taking the analysis one step deeper, we also took a look at the percentage of companies with locations outside the United States, in addition to those with locations just outside of San Francisco. Out of the 903 startups in our dataset, there are 219 (roughly 24%) of companies with locations outside of the US, compared to 38% that just have locations outside of San Francisco.

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    Data source: Craft

    Next, we analyzed what the top cities in the United States where these companies have additional locations. The table below shows the top 10 cities where startups headquartered in San Francisco have additional locations. New York tops the list with 128 companies that have New York locations.

     

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    Data source: Craft

    Finally, we did a similar analysis to see what countries are most popular for startups to have additional locations. The table below shows the top 10 countries where startups headquartered in San Francisco have expanded to for international office locations. The U.K. tops the list with 105 companies from our dataset that have international United Kingdom locations, which represents roughly 48% of our subset of companies that have international locations. Also of note is that three of the top four countries are English-speaking countries

     

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    Data source: Craft

    Key takeaways:

    • 38% of startups headquartered in San Francisco with more than $5 million in funding have an additional location outside of San Francisco
    • Companies with higher amounts of funding have, in general, office locations outside of their primary headquarters in San Francisco; however, a significant portion of smaller companies have locations elsewhere, as well.
    • The most popular US city for SF startups to have an additional location is in New York City. The most popular country for SF startups to have an additional international location is the United Kingdom.

  • Why Are Millennials Eating Toxic Tide-Pods?

    A new internet meme called ‘The Tide Pod Challenge‘ has circulated social media channels with the millennial generation taking some severe risks to their health. In a period of wage stagnation and a job environment that is deteriorating, the hopeless millennials have resorted to stupid social media challenges in the hopes of gaining fame, and perhaps the chance for a better life. As we know, that is never the case, unless a brilliant millennial monetize the content.

     

    https://www.zerohedge.com/sites/default/files/inline-images/20180110_pod.png

    Nevertheless, in the first 15-days of the new year, as millennials are on break from overpriced universities, poison control centers across the country have received 39 calls of teens poisoning themselves after they ate the highly toxic laundry pod.

    On Tuesday, the American Association of Poison Control Centers (AAPCC) released a statement warning Americans about the “potential poison exposure to single-load laundry packets.”

    “The ‘laundry packet challenge’ is neither funny nor without serious health implications,” said Stephen Kaminski, JD, AAPCC’s CEO and Executive Director.

    “The intentional misuse of these products poses a real threat to the health of individuals. We have seen a large spike in single-load laundry packet exposures among teenagers since these videos have been uploaded,” Kaminski added.

    The challenge starts with a dumb millennial bitting into a brightly colored pod of death from tide and chewing the packet until they foam from the mouth. Yes, that is the challenge in its entirety…

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    Entertaining commentary from Jay Uchiha, “we three seconds into the new year and people already doing dumb shit.”

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    More stupid millennials poisoning themselves with ‘The Tide Pod Challenge’…

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    Poison control centers across the country have handled over 50,000 calls about liquid laundry packet exposures over the past five years. While a majority of the exposures are from unintentional misuse by children under the age of five, the recent trend of 13- to 19-year-olds have been responsible for more than 130 intentional exposures since 2016, according to the (AAPCC).

    “Everyone needs to be aware of the dangers of swallowing the contents of a single-load laundry packet. Only use the packets for their intended use and be sure to store them up and away,” said Kaminski.

    Consumer Reports warns about the ‘The Tide Pod Challenge.’ Their tweet outlines how the challenge may seem like a joke, but ingesting the dangerous chemicals could be deadly.

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    In a statement from Tide’s parent company, Procter & Gamble, representative Petra Renck wrote, “Nothing is more important to us than the safety of people who use our products. We are deeply concerned about conversations related to intentional and improper use of liquid laundry pacs and have been working with leading social media networks to remove harmful content that is not consistent with their policies.

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    Mention of eating Tide pods appeared as early as 2015, when satirical website The Onion published a column comparing them to candy. Then in March 2017, a video by College Humor titled Don’t Eat the Laundry Pods brought it back to the surface, featuring college students who were tempted to eat the pods. As of Jan 16, the video has more than three million views,” said Channel News Asia.

  • Thinking The Unthinkable: Nuclear War With North Korea

    Authored by Richard Bitzinger via The Strategic Culture Foundation,

    Is the Trump administration prepping the American people – indeed, the world – for a war against North Korea? It certainly seems so. US President Donald Trump is constantly needling North Korean leader Kim Jong-un, comparing the size of their respective “nuclear buttons,” while during a speech to the United Nations in September he promised to “totally destroy North Korea” if it was believed to be a threat to the United States.

    https://www.zerohedge.com/sites/default/files/inline-images/20180118_nuke.png

    Trump’s generals – the only other people he seems to trust, outside of his immediate family – appear to be playing along. The head of the US Marine Corps told his troops that “there’s a war coming.” H R McMaster, Trump’s national security adviser, also seems pumped up for conflict. According to recent articles, McMaster feels that traditional deterrence will not work on Kim, and that it is “almost impossible to overstate the threat from a nuclear-armed North Korea.”

    In apparent response, the US military seems to be gradually yielding to the idea of war with North Korea. A recent New York Times article ominously suggested that the military is quietly preparing for “a last resort: war with North Korea.” US forces are practicing quick-reaction mobilizations and air-assault exercises, sending Special Operations forces to South Korea, and deploying additional bombers, including B-2s, to Guam.

    The US military insists that it just wants to be prepared for any contingency. However, every day it seems more and more conceivable that a US-North Korean war could break out.

    Suppose they gave a war…

    Admittedly, there is a wide gap between conceiving a war with North Korea and actually undertaking one – and thank goodness for that. However, conceptualizations are often the first step toward action, and this raises two big concerns.

    The first worry, of course, is that the Trump administration could simply talk itself into a war. Saber-rattling and mobilizations can have the effect of self-fulfilling prophecy. The more one talks about war, the more it seems inevitable. This sense of inevitability, of being destinedto fight, was one of the more powerful factors in the outbreak of World War I. This fore-ordainment also helped spark the 1991 Gulf War and the 2003 Iraq war.

    More important, however, the Trump administration seems to have no idea how it should and could fight a war against North Korea. The United States has never engaged in an open and direct conflict with a nuclear-armed power. How does it fight such a war without setting off a nuclear response?

    The unlikely ground invasion

    In the first place, a ground invasion is probably out of the question. South Korea would never allow the US to use its territory as a launching pad for an attack on the North, and Seoul would certainly not join the US in such a foolhardy act.

    Even if US forces could cross the heavily defended Demilitarized Zone, they would face a huge and obstinate opposing force; most of the North Korean military may consist of obsolete weaponry, but it has a tremendous advantage in numbers, and the North Koreans would be fighting on their territory for their country. And if they began to lose, what would stop them from resorting to nuclear weapons?

    Moreover, such military action would play directly into Pyongyang’s hands. The North Koreans are already obsessed with the idea that the US wants to destroy them. A unilateral attack would only prove their fears are justified, and that might be sufficient to provoke a nuclear response.

    In addition, unilateral US military action would almost certainly engender global opprobrium. China would be livid that the US was destabilizing regional security. The Western alliance would be perhaps irretrievably ruptured, both in Europe and in Northeast Asia.

    The myth of the limited air campaign

    If the United States were to limit itself to bombing North Korea – using aircraft and cruise missiles – what would that accomplish? Trying to punish North Korea by using air attacks would again simply add to already high levels of North Korean paranoia that the US is trying to obliterate the country and eliminate the Kim regime. That could also incite a nuclear response.

    Could a US air campaign simply try to target North Korea’s weapons of mass destruction (WMD) – that is, its nuclear-weapons sites, missile factories, and missile systems? In other words, engage in a round of muscular counter-proliferation?

    That might work, if the United States had a very good idea where all of Kim’s WMD were located, and if it had a more than likely chance of destroying them all in one fell swoop. However, it is very likely that North Korea’s WMD complex is widely dispersed and heavily protected. Much of it is probably underground, in bomb-proof facilities.

    Consequently, it is unlikely that US air strikes would succeed in radically denuclearizing North Korea. At the same time, it could just as easily provoke the North Koreans into retaliating against the United States, using whatever nuclear capacities it had left.

    Would you like to play a game?

    In the end, the whole Trumpian war scenario against North Korea starts to resemble a sad, real-life imitation of the classic 1983 movie WarGames.

    https://www.zerohedge.com/sites/default/files/inline-images/20180118_wargames.png

    In that film, a supercomputer used to simulate nuclear war-fighting almost launches a real nuclear war, until it learns that, in such a scenario, “the only winning move is not to play.”

    Let’s hope that there are some people in the Trump administration who have watched this movie.

  • "Explosive", "Shocking" And "Alarming" FISA Memo Set To Rock DC, "End Mueller Investigation"

    All hell is breaking loose in Washington D.C. tonight after a four-page memo detailing extensive FISA court abuse was made available to the entire House of Representatives Thursday. The contents of the memo are so explosive, says Journalist Sara Carter, that it could lead to the removal of senior officials in the FBI and the Department of Justice and the end of Robert Mueller’s special counsel investigation.

    These sources say the report is “explosive,” stating they would not be surprised if it leads to the end of Robert Mueller’s Special Counsel investigation into President Trump and his associates. –Sara Carter

    a

    A source close to the matter tells Fox News that “the memo details the Intelligence Committee’s oversight work for the FBI and Justice, including the controversy over unmasking and FISA surveillance.” An educated guess by anyone who’s been paying attention for the last year leads to the obvious conclusion that the report reveals extensive abuse of power and highly illegal collusion between the Obama administration, the FBI, the DOJ and the Clinton Campaign against Donald Trump and his team during and after the 2016 presidential election.

    a

    Lawmakers who have seen the memo are calling for its immediate release, while the phrases “explosive,” “shocking,” “troubling,” and “alarming” have all been used in all sincerity. One congressman even likened the report’s details to KGB activity in Russia. “It is so alarming the American people have to see this,” Ohio Rep. Jim Jordan told Fox News. “It’s troubling. It is shocking,” North Carolina Rep. Mark Meadows said. “Part of me wishes that I didn’t read it because I don’t want to believe that those kinds of things could be happening in this country that I call home and love so much.

    Rep. Peter King, R-N.Y., offered the motion on Thursday to make the Republican majority-authored report available to the members.

    The document shows a troubling course of conduct and we need to make the document available, so the public can see it,” said a senior government official, who spoke on condition of anonymity due to the sensitivity of the document. “Once the public sees it, we can hold the people involved accountable in a number of ways.”

    The government official said that after reading the document “some of these people should no longer be in the government.” –Sara Carter

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    Florida Rep. Matt Gaetz (R) echoed Sara Carter’s sentiment that people might lose their job if the memo is released:

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    Deputy AG Rod Rosenstein

    I believe the consequence of its release will be major changes in people currently working at the FBI and the Department of Justice,” he said, referencing DOJ officials Rod Rosenstein and Bruce Ohr.

    Meanwhile, Rep. Matt Gatetz (R-FL) said not only will the release of this memo result in DOJ firing, but “people will go to jail.”

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    Former Secret Service agent Dan Bongino says “Take it to the bank, the FBI/FISA docs are devastating for the Dems.” 

     

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    The dossier was used in part as evidence for a warrant to surveil members of the Trump campaign, according to a story published this month. Former British spy Christopher Steele, who compiled the dossier in 2016, was hired by embattled research firm Fusion GPS. The firm’s founder is Glenn Simpson, a former Wall Street Journal reporter who has already testified before Congress in relation to the dossier. In October, The Washington Post revealed for the first time that it was the Hillary Clinton campaign and the DNC that financed Fusion GPS.

    Congressional members are hopeful that the classified information will be declassified and released to the public.

    We probably will get this stuff released by the end of the month,” stated a congressional member, who asked not to be named. –Sara Carter

    Releasing the memo to the public would require a committee vote, a source told Fox, adding that if approved, it could be released as long as there are no objections from the White House within five days

    Reactions from the citizenry have been on point: 

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    Even WikiLeaks has joined the fray, offering a reward in Bitcoin to anyone who will share the memo:

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    Oddly, the Twitter account for the House Permanent Select Committee on Intelligence – @HPSCI – has been mysteriously suspended.

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    Of all the recent developments in the ongoing investigation(s), this one is on the cusp of turning into a genuine happening.

  • Hungary Introduces "Stop Soros" Legislation To Fend Off Illegal Migrants By "Every Means Possible"

    Hungarian lawmakers previewed a proposed legislation package aimed at stemming the flood of mass illegal migrants through “every means possible,” including those who are aided by foreign funded NGOs such as the various organizations tied to billionaire George Soros.

    The legislative package presented during a Wednesday cabinet meeting has been referred to as the “Stop Soros Act” by government spokesman Zoltan Kovacs, in reference to the 87-year-old US-Hungarian financier who has been in a long-standing fallout with Hungarian Prime Minister Viktor Orbán.

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    “If Soros is found to have engaged in such activity, meaning he organizes illegal immigration, then the rules will apply to him,” Kovacs said.

    While the exact details will be presented on Thursday, Hungarian media detailed three primary pillars of the new legislation outlined by Interior Minister Sándor Pintér (translated): 

    1. NGOs which participate in or support illegal immigration will be obligated to provide data to the government on their activities.
    2. Affected NGOs that receive money from abroad must pay a 25% tax, collected by the National Tax and Customs administration. 
    3. Foreign nationals and Hungarian activists who support mass illegal migration may be subject to a restraining order which requires they remain up to 5 miles from the border, with diplomats and UN representatives exempt.

    Observance of these rules, Pintér said, will be checked by the prosecutor’s office, and if it finds an infringement, it will inform the court and propose a sanction on which the court may decide. –origo.hu (translated)

    The legislation follows an October, 2017 probe into Soros’ “Open Society” network, in which Orbán instructed his intelligence services to map what he described as the networks run by the billionaire financier’s “empire” targeting his country, reported BloombergOrbán also mailed a Soros-related questionnaire to all 8 million Hungarian voters (see: Hungary Launches Anti-Soros Political Campaign).

    As an illustration of the types of assistance provided by Soros NGO’s during a Wednesday press conference, Interior Minister Pintér gave the example of someone giving a mobile phone to an illegal migrant “with the aim of showing how to get to, say Sweden.”

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    a​​​​nti-Soros billboard, Hungary

    As we noted in December, three decades ago, Soros paid for a young Viktor Orbán to study in Britain. And as recently as 2010, Soros donated $1 million to Orbán’s government to help the cleanup effort following the infamous “red sludge” disaster.

    But the once-warm relationship between the two men has deteriorated substantially over the past seven years, as Orbán has drifted further to the right. In 2014, the leader of Hungary’s Fidesz party declared he would seek to model Hungary’s government after “illiberal” democracies like the government of Russian President Vladimir Putin.

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    anti-Soros p​​​​​osters in Hungarian train station

    Of late, Orbán has accused the “open border” tycoon and philanthropist of trying to undermine European values and cultural identities by actively promoting and assisting a flood of refugees and asylum seekers from largely Muslim countries

    In 2015, Soros stated that the European Union “has to accept at least a million asylum-seekers annually for the foreseeable future. And, to do that, it must share the burden fairly.”

    In December, Soros was accused by Orbán of planning to interfere with Hungary’s upcoming April, 2018 election by distributing pro-immigration propaganda via Soros-linked NGOs. 

    Hungary is far from alone in its desire to preserve its borders, language and culture: Poland has joined Hungary’s anti-immigration stance, drawing rebuke and threats from the European Union, of which it is a member. At an early January press conference in Budapest, Viktor Orbán and Polish Prime Minister Mateusz Morawiecki told reporters “The EU’s migration policy… has failed,” adding “It is clear that the European people don’t want immigration, while several European leaders are still forcing the failed immigration policy.” 

    “In terms of migration and quotas that were to be imposed on (EU) member countries we strongly reject such an approach as it infringes on sovereign decisions of member states,” Morawiecki said.

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    Polish Prime Minister Mateusz Morawiecki, Viktor Orbán

    Meanwhile, last year in Austria, a 31-year-old anti-immigration candidate led his party to victory in Parliamentary elections. In the Czech Republic, a populist tycoon named Andrej Babis who’s been described as the “Czech Donald Trump.” Babis led his party to a landslide victory, making him the frontrunner to become the republic’s next prime minister. Italy’s two richest regions overwhelmingly voted for autonomy over the weekend, and so on.

    That said, with his unlimited financial resources, Soros is more than capable of striking back against Orbán. The billionaire financier donated $18 billion in assets from his family office to his “Open Society” foundation, which oversees a network of dozens of nonprofits that seek to promote Soros’s political values. Incidentally, the final showdown – financial or otherwise – may be not between Soros and Orban but Soros and Putin whose wealth, according to some estimates as much as $200 billion, is orders of magnitude higher than that of Soros.

    In November, Soros responded to Orbánposting a scathing rebuttal to his website for an “anti-Soros, anti-Muslim, anti-Semitic propaganda effort.” 

    With Hungary’s health care and education systems in distress and corruption rife, the current government has sought to create an outside enemy to distract citizens. The government selected George Soros for this purpose, launching a massive anti-Soros media campaign costing tens of millions of euros in taxpayer money, stoking anti-Muslim sentiment, and employing anti-Semitic tropes reminiscent of the 1930s. The national consultation is part of an ongoing propaganda effort that has been underway since May 2015 that included the “Stop Brussels” consultation in the spring of 2017 and the referendum that vilified migrants and refugees in 2016.

    Soros went on to offer a “rebuttal”, which in several cases read more like a confirmation of Orban’s “propaganda.” You can read it here.

  • Course Uses "Pyramid Of White Supremacy" To Teach Diversity

    Authored by Kassy Dillon via Campus Reform,

    A course at Salisbury University in Maryland is using a “Pyramid of White Supremacy” to help teach students about diversity and “cultural competence.”

    The one-credit course, “Diversity and the Self,” is a required class for any student hoping to obtain an elementary education major.

    The pyramid ranks various concepts on different levels according to severity, with “Indifference” forming the base of the pyramid and “Genocide” residing at the top.

    “In a pyramid, every brick depends upon the one below it for support,” an accompanying caption explains. “If the bricks at the bottom are removed, the whole structure comes tumbling down.”

    Things like “avoiding confrontation with racist family members,” “remaining apolitical,” or saying “politics doesn’t affect me” make up the base of the Pyramid of White Supremacy, directly underneath forms of “minimization” such as “denial of white privilege” and “not believing experiences of POC [people of color].”

    The next level up is “veiled racism,” which the graphic defines to include “cultural appropriation” and a “Euro-centric curriculum.”

    Worse still, according to the pyramid, are “anti-immigration policies,” “stop and frisk” policing strategies, and “funding schools locally,” all of which fall under the category of “discrimination.”

    Above that the pyramid lists “calls for violence” such as “swastikas,” “Confederate flags,” and “the n-word,” followed by actual acts of violence like “unjust police shootings,” “lynching,” and all other hate crimes.

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    “We had to study the pyramid and also take a group quiz,” a student in the class who wishes to remain anonymous told Campus Reform, noting that the placement of certain elements on the pyramid raised eyebrows.

    “I find it ridiculous that ‘unjust police shootings’ is at the top of the list next to mass murder and genocide,” the student remarked. “The pyramid was not only biased, the way they ranked the events did not make much sense.”

    According to the syllabus, the course “reviews theories and aspects of cultural competence most relevant to teaching in diverse classrooms,” and “explores the ideals of freedom, democracy, justice, equality, equity, and human dignity from the perspective of the individual.”

    This class was extremely difficult to get through if you did not think like a liberal. Instead of teaching diversity, this class taught us that being white was a bad thing,” the student complained. “We were told that we were only privileged because we are white and basically we did not actually work for what we have.”

    Erin Stutelberg, the professor teaching the course, practices what she preaches outside of the classroom, as well. On her Facebook page, her display photo is a picture of her with a sign saying: “White Silence = Violence.”

    Campus Reform reached out to Stutelberg for comment, but has not received a response.

  • India Test Fires Nuclear-Capable ICBM, Poses Major Threat To China

    On Thursday, India successfully conducted the “first pre-induction trial” of its over 5,000-km range Agni-V intercontinental ballistic missile (ICBM), reported The Times of India.

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    The nuclear-capable ICBM paves the way for India to join an “elite” group of countries who can strap a nuclear bomb to an ICBM and fling it across the globe. More importantly, the development has dramatically changed the calculus of war and nuclear deterrence balance of power between India and China, putting most of China’s critical assets, including the coastal cities in range.

    The ICBM, called Agni-V, was launched on Thursday from Abdul Kalam Island, off Odisha State in eastern India, flying for about 19-minutes with a range of 3,000 miles.

    The Defense Minister Nirmala Sitharaman said, “We have successfully launched nuclear-capable ballistic missile Agni-V today.”

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    According to The Times of India’s sources, “The country’s most formidable missile will undergo one more such pre-induction trial within this year before it is inducted into the Agni-V regiment already raised by the tri-Service Strategic Forces Command (SFC) with the requisite command and control structures.”

    With the Agni-V, India is now a member of the “nuclear club” of countries with ICBMs with a range of over  5,000km such as the U.S., Russia, China, France, and the United Kingdom. The motive behind India’s development of the long-range ICBM is to deter the threat of an aggressive and expansionist China, which already has an arsenal of ICBMs.

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    The Times of India provides further insight on the nuclear capabilities of the Angi-V:

    The over 50-tonne Agni-V, designed to carry a 1.5-tonne nuclear warhead, has been tested four times in “developmental or experimental trials” earlier. The missile was tested in an “open configuration” in April 2012 and September 2013, while it was test-fired from hermetically sealed canisters mounted on transport-cum-tilting launcher trucks in January 2015 and December 2016.

    “The missile’s flight performance was tracked and monitored by radars, range stations and tracking systems all through the mission. All mission objectives were successfully met. This successful test of Agni-V reaffirms the country’s indigenous missile capabilities and further strengthens our credible deterrence,” said a defense ministry official.

    The Strategic Forces Command (SFC) called Strategic Nuclear Command of India already has regiments of the Prithvi-II (350-km), Agni-I (700-km), Agni-II (2,000-km) & Agni-III (3,000-km) missiles, which are meant to deter Pakistan. On the other hand, the Agni-IV (4,000-km) and Agni-V (over 5,000-km), have been developed to keep China in check.

    “Though the missile could theoretically hit Beijing, India’s missile technique is far below the standard,” Hu Zhiyong, a research fellow at the Institute of International Relations of the Shanghai Academy of Social Sciences, told the Global Times on Thursday.

    While China has criticized India’s development of the Angi-V, India’s president, Ram Nath Kovind, celebrated on Twitter that the launch “makes every Indian very proud” and will “boost our strategic defense.”

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    The Indian National Congress party wrote on Twitter, “This is the culmination of a multi-decade effort under the Integrated Guided Missile Development Programme started in 1982 by the then Prime Minister, Smt Indira Gandhi.”

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    We expect that an angry verbal Chinese response, most likely in the Global Times, is imminent.

    Full press statement on the fifth flight test of the Agni-V ICBM.

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Today’s News 18th January 2018

  • Censorship World: New Zealand Fisheries Want Grisly Images Of Dead Penguins Caught In Nets Banned

    Authored by Eleanor Ainge Roy via The Guardian,

    The seafood industry in New Zealand has asked the government to withhold graphic video of dead sea life caught in trawler nets as they are potentially damaging to fisheries and to brand New Zealand.

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    A letter from five seafood industry leaders to the Ministry of Primary Industries highlights the fisheries’ growing unease with the government’s proposal to install video cameras on all commercial fishing vessels to monitor bycatch of other species and illegal fish dumping.

    The letter requests an amendment to the Fisheries Act, so video captured onboard cannot be released to the general public through a freedom of information request, frequently used by the media, campaign groups and opposition parties.

    “They [the proposed videos] also raise significant risks for MPI and for ‘New Zealand Inc’,” the letter reads, also citing concerns about invading the privacy of employees onboard, and protecting commercial and trade secrets.

    ​There are no reliable figures on the numbers of penguins, sea lions, dolphins and seals that die in fishing nets or longlines in New Zealand, but according to some researchers and environmental groups the commercial fishing industry is the main culprit for declining populations of endangered sea lions and yellow-eyed penguins.

    Only 25% of deepwater trawlers in New Zealand have government observers onboard to record bycatch and discards, according to the National Institute of Water and Atmospheric Research [Niwa], which relies on statistical modelling techniques to generate bycatch estimates for the 75% of boats that work unobserved.

    Niwa estimates for every kilogram of reported target catch (what the fishing boat aims to catch ) there is 0.2 kg of bycatch.

    “These are the images the fishing industry doesn’t want you to see,” said Forest & Bird’s chief executive Kevin Hague.

    “What they [the seafood industry] are saying is catching endangered penguins, dumping entire hauls of fish overboard and killing Hector’s dolphins looks really bad on TV. Well, the solution is to stop doing it, not to hide the evidence. It’s hard to think of a more credibility damaging activity than trying to change the law so the rest of us can’t see what’s really happening out there,

    Deepwater fishing vessels account for 80% of New Zealand’s annual catch and earn NZ$650m per annum in export dollars.

    Stuart Anderson, director of fisheries management for MPI, said no decision had been made regarding the seafood industry’s proposed changes to what information the government should release about their practices at sea.

    “There are many elements to consider carefully in balancing the responsibilities of transparency and public interest while protecting privacy and other sensitive information” Anderson said.

    *  *  *

    Brings a whole new meaning to the term ‘net neutrality’…

  • FBI Investigating Millions Of "Mishandled" Dollars Funneled From Australian Govt To Clinton Foundation

    The FBI has asked retired Australian policeman-turned investigative journalist, Michael Smith, to provide information he has gathered detailing multiple allegations of the Clinton Foundation receiving tens of millions of mishandled taxpayer funds, according to LifeZette

    “I have been asked to provide the FBI with further and better particulars about allegations regarding improper donations to the CF funded by Australian taxpayers,” Smith told LifeZette.

    Of note, the Clinton Foundation received some $88 million from Australian taxpayers between 2006 and 2014, reaching its peak in 2012-2013 – which was coincidentally (we’re sure) Australian Prime Minister Julia Gillard’s last year in office.

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    Hillary Clinton and former Australian PM Julia Gillard 

    Smith names several key figures in his complaints of malfeasance, including Bill and Hillary Clinton and multiple Australian government officials – including senior diplomat Alexander Downer, whose conversation with Trump aide George Papadopoulos that Russia had ‘dirt’ on Hillary Clinton allegedly launched the Trump-Russia investigation (as opposed to the Fusion GPS dossier, of course). 

    Within hours of the NYT publication, the paper was immediately shredded as the information Papadopoulous told Downer was already public

    The materials Smith is giving to the FBI focus on a 2007 memorandum of understanding (MOU) between the Clinton Foundation’s HIV/AIDs Initiative (CHAI) and the Australian government. 

    Smith claims the foundation received a “$25M financial advantage dishonestly obtained by deception” as a result of actions by Bill Clinton and Downer, who was then Australia’s minister of foreign affairs. 

    Also included in the Smith materials are evidence he believes shows “corrupt October 2006 backdating of false tender advertisements purporting to advertise the availability of a $15 million contract to provide HIV/AIDS services in Papua New Guinea on behalf of the Australian government after an agreement was already in place to pay the Clinton Foundation and/or associates.”-Lifezette

    As a reminder, the Australian government announced that they would stop pouring millions of dollars into accounts linked to the Clinton charities in November of 2016 – right after Hillary Clinton lost the election. 

    The federal government confirmed to news.com.au it has not renewed any of its partnerships with the scandal-plagued Clinton Foundation, effectively ending 10 years of taxpayer-funded contributions worth more than $88 million.

    The Clinton Foundation has a rocky past. It was described as “a slush fund”, is still at the centre of an FBI investigation and was revealed to have spent more than $50 million on travel.

    Despite that, the official website for the charity shows contributions from both AUSAID and the Commonwealth of Australia, each worth between $10 million and $25 million.

    (Norway, coincidentally, also reduced its $20 million / year donations to the Clinton Foundation right after Hillary’s loss.) 

    A third complaint by Smith revolves around a “$10 million financial advantage dishonestly obtained by deception between April 1, 2008, and Sept. 25, 2008, at Washington, D.C., New York, New York, and Canberra Australia involving an MOU between the Australian government, the “Clinton Climate Initiative,” and the purported “Global Carbon Capture and Storage Institute Inc.”

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    When asked why the Clinton Foundation was chosen as a recipient of Australian taxpayer dollars, a spokesman for the Department of Foreign Affairs and Trade said that all funding was used “solely for agreed development projects” and Clinton charities have “a proven track record” in helping developing countries.

  • Brandon Smith: Is The Olympic Games In South Korea A Perfect Opportunity For A False Flag Attack?

    Authored by Brandon Smith via Alt-Market.com,

    The war rhetoric surrounding North Korea on both sides of the Pacific has never been more aggressive than it has been the past year (at least not since the Korean War). There are some people that see the entire affair as a “distraction,” a distraction that will never amount to actual conflict. I disagree with this sentiment for a number of reasons.

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    North Korea is indeed a distraction, but still a distraction in the making. That is to say, the chest beating and saber rattling are merely a prelude to the much more effective distraction of live combat and invasion in the name of regime change and “national security.” As I noted in my article “Korean War Part II: Why It’s Probably Going To Happen,” the extensive staging of military assets to the region that has not been seen in over a decade, the extremely swift advancement of North Korean missile technology to include ICBMs capable of reaching the mainland U.S., the strange and unprecedented language by China indicating that they will not intercede against an invasion of North Korea by the U.S. “if Pyongyang attacks first….” All of this and more shows a clear movement of chess pieces into place for a sudden action.

    According to these factors, I am led to believe that a false flag event blamed on North Korea, or a prodding of North Korea into taking an attack posture, is likely.

    The purposes behind such a war would be many-fold. Primarily, the final implosion of the vast financial bubbles created by central bank stimulus measures could be undertaken while the banks themselves escape public blame or prosecution.

    A geopolitical crisis large enough would provide a perfect scapegoat for an economic crisis that was going to develop eventually anyway. And, if this geopolitical crisis were initiated by a “rogue state,” along with the poor decisions of a conservative “populist” president (Trump), then the historical narrative would be complete. Future generations would talk about the “great blunder” of sovereign states and nationalists and how hubris and greed and ego led to a global fiscal disaster and unnecessary destruction. The rationale for a one world governmental authority would be planted in the minds of the populace.

    Will a war in North Korea be the trigger event for this narrative? It’s hard to say, as there are so many potential geopolitical powder kegs around the world. However, ample assets to initiate this kind of event are present around North Korea. And, unlike hot spots like Syria and Iran, North Korea offers the most immediate and tangible threat in the minds of many people with its nuclear arsenal.

    The pure panic and mindless reactionary thinking that can be provoked in the unprepared when the danger of nukes is present is quite powerful. This could not have been made more clear than this past week when an “accidental” warning of a live ICBM launch occurred in Hawaii.

    The Hawaii Emergency Management Agency now claims that this false alarm was started by a single employee, who has not been named.  How? They somehow “pushed the wrong button” … twice!

    I find this explanation absurd. I can only find one example of a false alarm similar to the one in Hawaii, and this took place way back in 1971 with a mix-up of tapes leading to a broadcast warning of imminent attack on the U.S. After this event, the alert system was subject to streamlining and stopgaps designed to prevent it from ever happening again. During the false alarm of 1971, over six attempts were made for cancellation broadcasts, the first one within about ten minutes of the initial false alarm. In Hawaii, no cancellation was attempted for nearly 40 minutes.

    To add to the overall strangeness, there was yet another false missile alarm in Japan within the same week!  Yet again, this alert was immediately attributed to North Korea, but at least this time the alert was corrected 5 minutes later instead of 40.

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    To me, this smells of a psyop; a test to gauge public reactions to a threat, as well as planting preconceived notions of a particular bogeyman. The public did not disappoint.

    Eye witnesses described people “running and crying in the streets,” completely bewildered as to what to do. An associate of mine (who is also experienced in preparedness) was in Hawaii at the time of the event. She related to me that her family decided to shelter in place because there were no indications that fallout shelters were available anyway. Other people tried to lower their children into the sewers in an effort to escape a nuclear blast. Here is a video showing the false missile alert causing hysteria in Hawaii:

    (As a side note, sheltering in a sewer during an actual nuclear event is the height of stupidity. Nuclear blasts send irradiated particulates into the air. These particulates then settle in the streets or are washed out of the air by rainfall. This water becomes a highly concentrated dose of irradiated particulates which are then drained down into the sewers. You might survive the initial blast, you might not, but you are certain to die from radiation if waiting out the attack in a sewer. Shelter in a dry basement instead with as much matter density between you and the outside as possible. Keep in mind that whatever place you choose to shelter is where you will likely have to stay for at least two weeks, or until the nuclear half life of the particulates has run its course.)

    Obviously the average American is completely unprepared for a real attack of a minor magnitude, let alone the magnitude of a nuclear blast. Perhaps this reaction in Hawaii was so prevalent because Hawaii tends to be left leaning to the extreme, and leftists are generally poorly prepared for anything beyond a cancellation by their manicurists. That said, the fact that this “mistake” happened to take place in Hawaii  and Japan which are already under stress due to the ballistic missile tests of North Korea is an interesting coincidence indeed.

    Seeing what the reaction in Hawaii was like, a real attack presents an alluring opportunity for the establishment. The pure terror involved in just the potential of a nuclear attack is palpable, and this fear makes the masses easy to manipulate. Should a real attack take place, either by North Korea or by other agencies through false flag, when is the most advantageous time?

    The history of Korean conflict suggests a surprise attack is a probable strategy. North Korea is a nation trapped in time, and North Korean authorities remember the success of the surprise attacks they used to launch the first Korean war in June 1950. These attacks allowed North Korea communists to overrun South Korean forces within days.

    In terms of a false flag event, these seem to occur in the midst of other “training exercises” or distracting events. I can’t think of anything more distracting for South Korea than the Winter Olympics, set to take place February 9-25 in Pyeongchang.

    I would note the sudden friendly demeanor between North Korea and South Korea just before the Olympics, including the offer by North Korea to participate in a joint women’s hockey team during the games (something that has never happened before). Would it not be a shame if this ember of goodwill was snuffed out by a North Korean missile test or attack of some kind? The “betrayal” would be excellent war fuel, like a new Pearl Harbor.

    As Secretary of State Rex Tillerson stated recently, the threat of war with North Korea is “growing” despite the recent “thaw” in relations due to the Olympic Games.  The thaw is partially predicated on the North Korean demand that all South Korean and US military exercises be cancelled during negotiations.

    The typical response by skeptics will be that any attack by North Korea would be met with massive nuclear response. I would point out that a full-scale nuclear response is unlikely in the region.

    First, a nuclear onslaught on North Korea also puts its neighbors (our allies) at risk of considerable radiation exposure. The argument may be made that only a conventional assault would be safe for the surrounding countries, not to mention the Pacific U.S., which could see radiation exposure as well.

    Second, a nuke attack is not necessarily going to prevent the need for a ground invasion. North Korea has more than 8,000 underground facilities that we know of and has been preparing for bombardment for over 60 years. Its mountainous terrain also presents serious doubts as to the effectiveness of bombardment. This is not just my assessment but the assessment of the Department of Defense. The idea that one big nuke button is going to solve the problem is childish delusion by people who watch too many movies.

    Hopefully, the Olympics will conclude without incident and the skeptics are proven correct on North Korean tensions being nothing more than a sideshow amounting to a lot of bluster. But for now the level of conflict staging over the past year should be taken seriously, and the panic that could develop if a war does erupt should be concerning to us all. In times of crisis, people act stupidly and they beg for help from anyone offering, even if it is someone with malicious intent. Fearful individuals will give up almost anything to escape uncertainty, including their freedom and their common sense. And nothing causes fear quite so much as thoughts of war and mushroom clouds.

  • California's Homeless Problem Revealed In One "Incredible" Video

    Despite the record stock market and unemployment at 4.1% (despite a December jobs miss), the socialist utopia known as California is home to an ever-sprawling tent city which estimated to contain over 1,000 residents.

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    After a ZeroHedge report last March on the sprawling tent cities, a 10-minute video, dubbed by some as “incredible” has emerged showing the shocking growth of the encampment near Angels Stadium in Anaheim, CA along the Santa Ana river. 

    Locals have become increasingly alarmed by the rapid spread of unregulated squatters and their belongings and their waste.

    As a cyclist who uses the trail to ride to the beach often, over this last year it has gotten substantially worse.  It is unsafe and unsanitary with loose dogs everywhere and human fecal matter scattered on the trail.

    The area is disgusting and reeks of trash and feces.

    He reports that the bike trail, once popular with outdoors enthusiasts and families which runs for miles to beaches along the Pacific Ocean, has become unsafe as miscreants plot assaults and robberies on passing riders, even laying tripwires across the path. Dan Lyman

    Domestic Migration

    As we pointed out last March, California’s Democrats aren’t just failing the poor people that have been relegated to tent cities (see “Americans Fleeing Expensive, Over-Taxed Metro Areas In Pursuit Of Affordability“). In fact, people of all income brackets are fleeing the state in droves. Not surprisingly, these domestic migrants are flocking to areas with a lower cost of living, lower/no state income taxes, less regulations and higher job growth (aka “Red” states).

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    Ironically, the dark areas on the map above seem to match perfectly with the dark areas on this map which indicate those with the highest state income tax rates.

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    What an odd coincidence…

  • Is Bitcoin A Reaction To US Dollar Hegemony?

    Authored by Federico Pieraccini via The Strategic Culture Foundation,

    Blockchain technology and the birth of the so-called cryptocurrencies finds deep roots in three contributing factors:

    • the advance of technology:
    • the manipulation of global economic and financial rules;
    • and the persistent attempt to weaken the national economies of countries that geopolitically challenge the US power system.

    In this first article I address these issues from a financial point of view, in the next analysis I intend to dive into the geopolitical aspects and broader the perspective on how Russia, China and other nations are taking advantage of a decentralized financial system.

     

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    Many national economies seem to have begun the process of protecting themselves from what seems like an inevitable economic trend. De-dollarization — dumping dollars for other goods of value — has become popular not only with countries but also with ordinary individuals as a result of global technological growth and increasing access to the Internet. The financial markets are generally reflecting this same trend.

    The US dollar is the world’s most dominant reserve currency. The planning and financial rules that accompany this situation are decided in the United States for the benefit of Washington and a few of her allies. This has been reflected in the creation of the petrodollar, the abolition of the gold standard, and the most recent financial crisis of 2008, with the senseless process of quantitative easing. All these economic decisions have been made with the precise aim of prolonging American domination of the global economy, artificially propping up an unsustainable financial system.

    The practical consequences of this unsustainability have led over time to thoughts of a practical alternative, both to escape from the domination of the dollar and to re-anchor the economy to real value. The need to circumvent this situation has become especially urgent for countries with a large amount of dollar-denominated debt, or where they face the prospect of being excluded from the SWIFT international payment system.

    It is therefore not accidental that countries like Iran and Venezuela, but also Russia and North Korea, have resorted to alternative methods to operate in the global economic space. Washington’s political decision in 2012 to remove Iranian banks from SWIFT immediately set off alarm bells for several countries. The need to escape from the possibility of being excluded from SWIFT became urgent for countries under the threat of Washington. An alternative payment system was thus born in 2015, christened the Cross-Border Interbank Payments System (CIPS), unsurprising founded by China. Basically a copy of the SWIFT system, it serves the role of being a backup system should the Americans seek to exclude from SWIFT recalcitrant countries. A more radical solution has been sought by Venezuela, with the country creating its own virtual currency. President Maduro has announced the creation of a crypto state currency based on the value of oil and supported by barrels of oil worth over five billion dollars. Venezuela has been forced to take this step because of a scarcity of US dollars in the country brought on by the economic warfare visited on the it by Washington, which has succeeded in driving the country into a deep crisis.

    This search for fresh liquidity is a gamble for Maduro, who even hopes to be able to trade with allied countries in the new currency, thus circumventing international bans. Even North Korea is said to operate in bitcoin, thereby circumventing the international system of prohibitions and blockades.

    The sanctions on Russia, and the influence that Washington exerts with the dollar on the global economic system, has led Moscow and Beijing to a de-dollarization agreement, establishing the yuan gold standard. Russia sells hydrocarbons to China, which pays for them in yuan, then Russia immediately converts the yuan into gold at the Shanghai Gold Exchange, in the process bypassing Washington’s sanctions.

    This situation is being replicated in country after country. The United States increases financial and economic pressure on countries through such international bodies as the IMF and the World Bank, then these countries organize amongst themselves to push back against the interference. Technology has facilitated this strategy of decentralization against the center that is London and Washington, the financial heart and primary cause of manifold global problems. Firstly, the possibility of the unlimited printing of dollars has distorted global economies, inflating stock markets and causing national debts to grow out of control. Even the gold markets are manipulated by virtue of the abundance of easy money and such ponzi-scheme tools as derivatives and other forms of financial leverage. All too predictably, as seen in 2008, if it all comes crashing down, the central banks are going to bail out their partners through the mechanism of quantitative easing, guaranteeing unlimited cashflow and leaving taxpayers, along with the small players in the financial markets, to carry the burden.

    It is probably too early for the common man to understand what is happening, but in fact the dollar is depreciating in relation to some more tangible assets. But gold continues to be corralled by parallel financial mechanisms and other financial instruments created for the sole purpose of manipulating the financial markets on which the common man depends in search of modest gains. As with others, the gold market suffers from the combine power of the US dollar, centralized financial institutions and market manipulation. Entities such as the FED (and their owners), criminally colluding and working with private banks, hedge funds, rating agencies and audit companies, have made immense wealth by driving the world into a debt scam that has stripped normal citizens of their future.

    What is happening in the cryptocurrency markets in not only occurring in parallel with the spread of the Internet, smartphones and the increasing ability to operate in the digital world, but is also seen as a safe haven from centralized financial regulators and central banks; in other words, from the dollar and fiat currencies in general. Whether bitcoin will prove to be a wise long-term investment is yet to be seen, but the concept of cryptocurrencies is here to stay. The technology behind the idea, the blockchain, is a definitive model for decentralized economic transactions without any intermediary that can manipulate and distort the market at will. It is the antidote to the debt virus that is killing our society and spreading chaos around the world.

    Washington is now left to deal with the consequences of its demented actions against its geopolitical adversaries. The decision to remove Iran from the SWIFT system, and the ongoing economic war against Russia and Venezuela, have pushed the People’s Republic of China to obviate any direct attacks on its financial system by creating an alternative economic system. The goal is to warn the United States and her allies that an economic alternative exists and is already operational, ready to be opposed to the Euro-American system if necessary. Washington does not seem to want to renounce the role of manipulator and ruler of world speculative finance, and the obvious result of this is the creation of a financial system that is slowly working against the current one. Lack of anonymity and the centrality of systems seem to be the two fundamental elements of the current financial system that orbits around London and Washington. An anonymous, decentralized and technologically reliable system could be exactly what Washington’s geopolitical adversaries have been looking for to end the US-Dollar hegemony.

  • "The Sex Was Textbook Generic" – Stormy Daniels Dishes On Trump Hookup

    Stormy Daniels – the former porn star who claims to have had an affair with President Trump back in 2006, shortly after his marriage to First Lady Melania Trump – is refusing to go away. On Wednesday, In Touch, the glossy supermarket tabloid, published excerpts from an interview that Daniels – real name Stephanie Clifford – gave to the magazine back in 2011.

    In the excerpts, Daniels discusses her, uh, liaison with Trump in intimate detail. The affair took place in a Lake Tahoe Nevada hotel suite. In Touch corroborated the story with Daniels’s good friend, Randy Spears. Her ex-husband, Mike Moz, also confirmed the story.
    Daniels also reportedly took and passed a polygraph test administered by In Touch at the time of the interview.

     

    Daniels

    The most salacious details included in the story was Daniels’s description Trump’s bedroom demeanor.

    Stormy told In Touch, “[The sex] was textbook generic,” while discussing the fling they had less than four months after Donald’s wife, Melania, gave birth to their son, Barron. “I actually don’t even know why I did it, but I do remember while we were having sex, I was like, ‘Please, don’t try to pay me.’”

    Trump met Daniels at the American Century celebrity golf tournament in July 2006. Trump asked her to dinner, to which she readily agreed…

    When she met with Trump, she was greeted by a bodyguard named Keith – presumably former Oval Office Director of Operations and Trump Organization Security Chief Keith Schilller…

    It all started at the American Century celebrity golf tournament in July 2006. “[Trump] was introduced to everybody. He kept looking at me and then we ended up riding to another hole on the same golf cart together,” Stormy recalled, adding that the business mogul later came to the gift lounge her adult-film company, Wicked Pictures, sponsored and asked for her number, which she gave him, before they posed for a photo together.

    “Then he asked me if I wanted to have dinner that night. And I was like, ‘Yeah, of course!’” she told In Touch. Stormy, dressed up to go out on the town, arrived at Trump’s hotel room, where she says she was greeted by a bodyguard named Keith, who let her inside. Stormy claims Trump was sprawled on the couch watching TV, wearing pajama pants. “We ended up having dinner in the room,” she revealed to In Touch.

    After the deed, Daniels said the two hung out for a bit. Then Trump promised to call her – though it’s unclear whether he ever did.

    At one point, Stormy told In Touch, she excused herself to go to the bathroom.

    “When I came out, he was sitting on the bed and he was like, ‘Come here.’ And I was like, ‘Ugh, here we go.’ And we started kissing.” After having sex, Stormy said, “We hung out for a little while and he just kept saying, ‘I’m gonna call you, I’m gonna call you. I have to see you again. You’re amazing. We have to get you on The Apprentice.’”

    Trump has vigorously denied having an affair with Daniels, and the White House has contested a Wall Street Journal story claiming Trump lawyer Michael Cohen paid Daniels $130,000 to stop  her from sharing her story with Slate and Good Morning America in October 2016, shortly after the Access Hollywood tape leaked.

    Of course, this is just an excerpt. Daniels was pretty active in sharing her story about five years ago, it seems, back when Trump was the star host of NBC’s “Celebrity Apprentice.” In Touch  will publish a 5,000 word interview with Daniels later in the week…

  • Cryptocurrencies – Questioning The Value Proposition

    Authored by Stephen Englander via Rafiki Capital Management,

    Bitcoin is deciding whether this is the moment to crash and burn.

    https://www.zerohedge.com/sites/default/files/inline-images/20180117_bubble1.png

    My conjecture is that cryptocurrency holders are trying to decide whether to abandon Bitcoin because its limitations mean it will be superseded by better products or bet that it can thrive despite them.

    The dilemma is that once you stop pricing Bitcoin and its derivatives as new assets that will head to the moon, the pricing model is more conventional and much less breathtaking.

    We discuss these issues below.

    Below we go through some of the questions on why Bitcoin and cryptocurrencies have certain characteristics, and whether these characteristics are needed or even desirable.

    1. Is Bitcoin Netscape?
    2. How limited is the supply of cryptocurrencies?
    3. If Bitcoin crashes what happens to other alt-currencies?
    4. What asset market lacunae do cryptocurrencies fill?
    5. Why mine?
    6. Why distribute the ledger?
    7. Do cryptocurrency transactions need coins or tokens?
    8. Can you make cryptocurrencies KYC and AML compliant?​

    https://www.zerohedge.com/sites/default/files/inline-images/20180117_bubble.png

    1) Is Bitcoin Netscape?

    Bitcoin emerged in the shadow of the financial crisis, when the reputations of the financial and economic policy community was at a post-1930s low. It is designed for a world in which there is no confidence in major fiat currencies. Bitcoin gives you pseudonymity
      New York, 16th January 2018 (albeit imperfect), the distributed ledger means that transaction records are unlikely to disappear, the mining can take place anywhere and there are built-in incentives for miners to keep mining.

    The question is whether there is a problem that the original Bitcoin solves in developed economies. Some Bitcoin characteristics superficially suit a ‘Mad Max/Hunger Games’ world, but add little now. My suspicion is that even in the Mad Max world, the value of Bitcoin will be de minimis since hard assets will be the currency, not an abstract string of code. 

    Bitcoin may nonetheless be optimized for parts of the world that have harsh capital controls or dysfunctional governments, and for illicit transactions (although even here better versions exist). The characteristics listed above are helpful in preserving capital where security of capital and asset ownership does not exist.

    Pseudonymity, a distributed ledger and mining do not seem essential in developed economics and may even be drawbacks for many useful applications of the technology. It seems straightforward to design a cryptocurrency that is optimized for enabling cheaper transactions and recording of asset transfers and other transactions within the developed economy financial system. Some of these already exist and may be gaining on Bitcoin. Over time they may well supersede Bitcoin.

    There are paths by which Bitcoin could remain dominant, helped by its first mover advantage. However, there are likely many more paths by which it becomes a footnote either by cryptocurrencies that have functionality in transactions but not as a store of value, or because competitor alt-currencies are just better.

    2) How limited is the supply of cryptocurrencies?

    One of the weakest element of the Bitcoin/cryptocurrency origin mythology is the limited supply. That argument is still used to justify pricing Bitcoin off gold and other stores of value. As if Bitcoin cannot be replicated cheaply and indefinitely. Forks are increasingly popular because it feels like you are getting additional cryptocurrency for free. But some may notice that is an arbitrary supply increase. 

    There are no barriers to entry on the crypto space, other than a good story about the niche that your coin is filling. The number of ICOs tells you that it is easy and cheap. There are big incentives to get in on the ground floor of a cryptocurrency that has even moderate acceptance.

    3) If Bitcoin crashes what happens to other alt-currencies?

    The possibility that Bitcoin is superceded by better alt-currencies has important implications for the class. In fact, it likely determines the future pricing structure of these currencies.

    Bitcoin’s price does not have a floor because it does not have a fundamental pricing model like equities and bonds. If its price starts falling because other products are available and better, there is little to stop it. As a thought experiment, say Bitcoin was trading today at $14k and stayed there for three months. Six months from now it dropped to $14 and stayed there for three months. What would you look at to figure out which was the right price?  The run-up in Bitcoin created a mystique of one-way trading which is being shaken but the pricing requires faith that there will always be demand. This is far from guaranteed given the existence of alternatives with better characteristics.

    If Bitcoin crashes, investors in other alt-currencies will likely become more demanding in terms of the value proposition and link value to functionality, rather than faith. I can value a cryptocurrency that collects a fee for performing or recording transactions, but that value is likely to be different than as an alternative to gold or fiat money. This means pricing alt-currencies off credit card companies, depositories and other companies that provide similar transactions and recording services. That valuation is likely to be much more prosaic than the valuation now attached to cryptocurrencies as assets.

    4) What asset market lacunae do cryptocurrencies fill?

    If you are not afraid of a financial breakdown, confiscation of your assets or the feds, can you pin down the asset characteristics of a cryptocurrency that give them value? Do they allow you to hedge risk, choose a preferred point on the asset market risk-return curve, give you a share in some productive asset, or shift consumption from now into the future in a reliable way?  

    There are assets that are not much good in transactions (gold, the S&P ETF that you own) and transactions vehicles that are not great as assets (your VISA card, cash, the ATM at the corner dive that spares you the trouble of going to the bank). For now focus on the asset side and ask how capital in developed economies is better allocated because cryptocurrencies exist. (We discuss transactions functionality below.)

    Enabling young people to invest in human capital without the rationing, naivete and moral hazards of current student loan programs would concretely improve savings-investment efficiency. I am trying to think of an analogous asset market problem that crypto assets help resolve.

    The blockchain and other innovations associated with Bitcoin potentially could make transactions quicker, cheaper and less risky. However, this relates to their transactional functionality but is not here or there with respect to their desirability as an asset.

    If you believe that capital controls are immoral, you can argue that coin and other cryptocurrencies allow you to protect your assets by skirting such controls. That is not a big issue in G10 economies, but there could be a genuine debate elsewhere. If you believe that taxes are not moral or that arms/drug dealing is, you can make a similar case for cryptocurrencies link. Most of us need a lot of convincing before we swallow that.

    So I still struggle to determine a DM asset market problem that it solves. South Korea and a couple of other countries are rumored to be taking actions to limit or stop speculation in cryptocurrencies on the view that it is a waste of time and resources and does not contribute to the public good. 

    A similar motivation was behind Montreal banning pinball in public for decades after 1955. I was a personal victim of the ban in my youth. There is an element of paternalism in limiting a very narrow and specific set of transactions, while allowing you to blow your fortune on horse races or at the casino. However, most of us have a hard time discussing our ‘investments’ at the race track or casino.

    5) Why mine?

    Mining in Bitcoin and its clones provides incentives to maintain the distributed ledger.  It is also extends the analogy between Bitcoin and gold, which is a very effective marketing device. It is clear there is a colossal waste of energy link.  

    Digiconomist estimates that USD2bn worth of energy is being consumed to mine USD14bn of BTC. That means that the electricity cost is 14% of maintaining the blockchain and almost 1% of the Bitcoin market cap and likely to rise. It looks increasingly that cryptocurrency mining will be heavily concentrated in the locations where electricity is grotesquely mispriced. 

    Originally the mining was probably intended to deal with the collapse of fiat currencies. You would have a bunch of miners and maintaining a bunch of blockchains and manipulation would be close to impossible. Mining has now become so concentrated that there is a possibility that the transaction record could become corrupted by collusion among big miners, or that transactions costs could be artificially elevated. 

    Talking about large numbers of independent, decentralized cryptocurrency miners is like talking about the family farm in US agriculture. It’s a nice image but nowhere close to reality. Stories of individuals buying power plants to mine cryptocurrencies further weaken the narrative of a decentralized system that is coalition-proof link.

    The only reason to have mining now is because it has become a defining characteristic of cryptocurrencies, even though it has no real purpose, except to jump start interest in new currencies by offering high returns to the initial miners. Given the huge built-in inefficiency of mining process, the question is can you get the benefits of a cryptcurrency without the mining process. Some altcoins do not have mining and this is likely the direction future coins will take.

    6) Why distribute the ledger? 

    The distributed ledger solves the problem of how to maintain the integrity of a decentralized system. It doesn’t establish a need for such a decentralized system or justify the costs that are associated with it.

    What is the marginal benefit of the 51st ledger out there? You must fall back on the Mad Max world to really need so many replicative ledgers. Then you must believe that computer systems will be running. 

    One of the selling points on public blockchains is that their dispersion would make them impervious to hacking and corruption. With mining operations so specialized and concentrated, that argument has gone be the boards. I have seen discussions in which it is argued that the gaming the blockchain would be self-defeating and will not happen, but that is not the same as demonstrating that it cannot happen. 

    For many purposes private blockchains are likely to be more efficient. The need for replication is limited. Whether the security of the distributed blockchain exceeds that of private blockchains is unclear, as are the relative costs. Especially when there are a lot of transactions concentrated among a small number of participants, we are likely to see private rather than public blockchains dominate. My expectation is that we will come to see blockchains as clubs, rather than villages.

    7) Do cryptocurrency transactions need coins or tokens?

    My credit card enables me to transact across states and countries. But it doesn’t require that I buy a credit card asset or token. Say cryptocurrencies make cross-border transactions or asset transfers less expensive, or we use a blockchain to record transactions and contracts. It is obvious that fees will be charged for this service, just as the credit card company charges. But do we need a tradable asset with a fluctuating price as the medium for such transactions or records You can simply pay a fee to have the sale of your house or your employment contract put in the registry? Having a coin or token associated with these transactions doesn’t improve functionality.  

    Once you accept the view that cryptocurrencies will make it easier to execute and record transactions, but are not themselves assets or a store of value, coins or tokens have as little inherent value as the token used by children to establish their right for a ride on the merry-goround. The firms that perform the transactions will have a value, just as credit card companies do, but that doesn’t mean that the coin linked to the service will have anything but a momentary value.

    8) Can you make cryptocurrencies KYC and AML compliant?

    Cryptocurrency exchanges within developed economies all have some form of AML and KYC compliance. There are some AML compliant cryptocurrencies but my sense is that the ones that promise complete anonymity are far more popular. It appears that Bitcoin and most clones are not quite as anonymous as once advertised, but it also takes some effort to de-anonymize. So, if you are trying to hide from your partner how much you paid for the Rangers playoff tickets, you are pretty safe. However, if the authorities were interested in your particular transaction, they are likely to be able to figure it out as well. 

    Outside of DM economies it is likely that KYC and AML are not observed meticulously. Public blockchains record these transactions so they are not invisible, but they are harder to track than those made within organized DM exchanges with strict KYC and AML vetting. The question is whether the coexistence of a legitimate DM core and potentially shady non-DM spokes (or maybe a shady core and legitimate spokes) is feasible in the long term. My conjecture is that the coexistence will break down and that there will be a growing distinction between cryptocurrencies that operate fully within the global financial system and those that facilitate outside the system transactions.

    Concluding comments

    Cryptocurrency technology is likely to serve as the basis for executing asset transfers and storing the record of transactions and contracts. Mining, anonymity, and the distributed ledger are not relevant for most of these purposes. The case is not really made that cryptocurrencies are assets and that means that the current pricing proposition is shaky. It is possible that a private issued ‘fiat’ cryptocurrency will trade alongside other assets, but it is still not clear what would give it value.

    The underlying proposition is like the Marxist interpretation of history. The intellectual breadth and audacity are breathtaking. The ability to think through ex ante how a new, decentralized currency asset could be constructed and maintained is remarkable.  But that doesn’t mean that the underlying premises are correct, or that it solves a problem anyone really worries about.

  • Here's What Caused Today's Bond Selloff, And Why It Makes No Sense

    Today just after 1pm, Apple unveiled  that as part of its capital investment plan over the next 5 years (which aims to spend $30 billion and create 20,000 jobs in the US), the company expects to make a $38 billion tax payment to repatriate some/all of its offshore cash.

    The news coincided with an abrupt reversal in 10Y Treasurys, which sold off…

    sdf

    … accelerating the ramp in stocks, slamming gold and at the same time put in a bid for dollars, halting the greenback’s latest pounding, which earlier in the day had tumbled to three year lows.

     

    sdf

    And while many – including us – speculated that news of the Apple repatriation was the catalyst for this sharp intraday reversal, Morgan Stanley’s rate strategist Matthew Hornbach confirmed that was indeed the case, in his Wednesday EOD market commentary, to wit: “News about Apple’s repatriation plan fueled a sell-off in USTs led by the 7y point.”

    Even so, the market’s reaction to the Apple news left quite a few rates strategists, Hornbach including, puzzled. puzzled: “We don’t find the sell-off warranted by the headline since Apple’s marketable security holdings have a short maturity and are concentrated in corporate bonds.

    He explains further:

    By 8:00 AM New York, 10y yields were unchanged from the London open at 2.56%. Strong industrial production data at 9:15 AM failed to push yields higher and 10y yields hit the session low of 2.54% shortly before 11:00 AM. From there, rates were in the 2.55% to 2.56% range until a Bloomberg headline hit the tapes at 1:02 PM about Apple expecting a tax payment of $38bn for planned repatriated earnings.

    It was not clear over what period Apple planned to repatriate earnings, but the headline fueled speculation that the firm might have to sell some Treasury and corporate bond holdings to pay the tax liability, leading to a sell-off in UST yields for the rest of the afternoon. It is not clear to us that the headline warrants a sell-off since

    1. According to Apple’s 10-K filings  the “maturities of the Company’s long-term marketable securities generally range from one to five years.” That is, the best guess about the average maturity of their UST holdings would be 2.5 years. Yet, the sell-off was led by the 7y point and the 2s7s curve steepened by 2.5bp from the time the data was released until the close.
    2. Apple holds $55bn of Treasury securities compared to $152bn in corporate securities. So, it is not clear why UST yields sold off, while corporate spreads barely widened on the news. That is particularly puzzling since USTs constitute 15% of Apple’s assets, a value that is roughly in line with the share of USTs in their assets since 2010. Corporate bond holdings however have increased from 23% in 2010 to 41% in 2017, so it could be argued that Apple would be more inclined to sell corporate bonds to free up any needed cash.

    Another aspect of the market reaction to the headline that is puzzling is the strengthening of the US dollar. “Offshore cash” or unremitted earnings do not have to be physically offshore and can be invested in US dollar securities such as US Treasuries and unrelated corporate equities and bonds according to the tax code. As a result, unless Apple and other firms with unremitted earnings were intentionally running an unhedged short USD position that they now intend to close out, there should be no impact on the US dollar.

    In other words, the market was responding as if the algos reacting to the AAPL news were programmed by 22-year-old math Ph.D. who had no idea what they were doing. In other words, perfectly inefficiently.

    So will Morgan Stanley’s explanation be sufficient to send yields lower, the dollar sliding, bond spreads surging and reverse much of today’s market spike, all of which took place in erroneous response to the AAPL repatriation announcement? Of course not.

     

  • US Deploys Tactical Communications-Scrambling Plane To Korean Peninsula

    South Korea’s deal to allow North Korean athletes and dignitaries to attend the Winter Olympics in PyeongChang appeared to ease tensions on the peninsula earlier this month. Still, it appears the US air force has been expanding its presence in South Korea.

    Local media reported Monday that an EC-130H Compass Call aircraft, an advanced plane capable of denial of service attacks on enemy plane’s communication systems, was deployed to South Korea’s Osan Air Force Base by the US Air Force earlier this month.

    According to Sputnik, it’s unclear why the state-of-the-art tactical aircraft was deployed to the base. Some critics have speculated that it may be used to collect data on North Korea’s military during the Games, which are set to begin Feb. 9.

    US

    The plane, based at Arizona’s Davis-Monthan Air Force Base, the aircraft reportedly made its way to South Korea after stopping at Japan’s Yokota Air Base.

    The US Airforce only has 14 of these advanced aircraft in its entire arsenal, according to Sputnik.

    The planes have recently been used to keep Daesh fighters from coordinating attacks.

    “If we can shut down or deny their communication,” Lt. Col. Chris Weaton of the Electronic Combat Squadron said in a statement, “then we are causing chaos.”

    An estimated four of the 13 EC-130Hs are operating in Iraq and Syria.

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Today’s News 17th January 2018

  • The Fifth-Largest Diamond In History Was Just Discovered

    Shares of Gem Diamonds surged +15% on Monday after the miner said it had unearthed one of the biggest diamonds in history. According to Bloomberg, Gem Diamonds Ltd. discovered a massive 910-carat diamond, about the “size of two golf balls” from the Letseng mine in Lesotho, the highest dollar per carat diamond mine in the world.

    asd

    The diamond is the largest ever recovered from Letseng and is classified as a D color Type IIa diamond, which means it has very few impurities or nitrogen atoms. More importantly, the diamond is the fifth-biggest ever found.

    “Assuming that there are no large inclusions running through the diamond, we initially estimate a sale of $40m,” said Richard Knights at Liberum, citing the 1,109-carat Lesedi la Rona discovered in 2015, and it sold for $53 million.

    “This would imply a $43m price tag for the Letseng diamond, but we place large caveats on this estimation, given that the pricing is rarely linear,” he added.

     

    asd

    Clifford Elphick, Gem Diamonds’ Chief Executive Officer, commented in Monday’s press release:

    Since Gem Diamonds acquired Letseng in 2006, the mine has produced some of the world’s most remarkable diamonds, including the 603 carat Lesotho Promise, however, this exceptional top quality diamond is the largest to be mined to date and highlights the unsurpassed quality of the Letseng mine. This is a landmark recovery for all of Gem Diamonds’ stakeholders, including our employees, shareholders and the Government of Lesotho, our partner in the Letseng mine.

    The Letseng mine resides in the kingdom of Lesotho, located inside South Africa, and at an elevation of 10,000 feet, it is the world’s highest mine. Perhaps, there is a correlation between the elevation and diamond size and quality since Letseng is famous for its high-quality diamonds.

    The company’s official press release on Monday gave very little information surrounding the value of the diamond, or if there was even a buyer.

    Its value will be determined by the size and quality of the polished stones that can be cut from it. Lucara Diamond Corp. sold a 1,109-carat diamond for $53 million last year, but got a record $63 million for a smaller 813-carat stone it found at the same time in 2015.

    Shares of Gem, which list in London, advanced 14.25%, valuing the company around £126.59M. Since 2012, a lack of significant discoveries coupled with deteriorating financials has declined London shares more than -78%. Monday’s press release of the discovery could bolster the company’s cash position upon the sale of the diamond.

    “The successful sale of this stone will be supportive for Gem’s balance sheet and push the company into a free cash flow positive position this year,” said Richard Hatch of RBC Capital Markets.

    Last week, the company recovered 117-carat and 110-carat rocks from its mine. The three significant discoveries back-to-back could be an upward turn for the company and allow investors to ‘b-t-f-d’.

    Here are some diamonds recovered by Gem include:

    • 2006 – Lesotho Promise (603 carat)
    • 2007 – Lesotho Legacy (493 carat)
    • 2008 – Leseli La Letseng (478 carat)
    • 2011 – Letseng Star (550 carat)
    • 2014 – Yellow (299 carat)
    • 2015 – Letseng Destiny (314 carat)
    • 2015 – Letseng Dynasty (357 carat)
    • 2018-  Letseng (910 carat)

    Bloomberg identifies the world’s largest diamond finds:

    The biggest diamond discovered is the 3,106-carat Cullinan, found near Pretoria, in South Africa, in 1905. It was cut to form the Great Star of Africa and the Lesser Star of Africa, which are set in the Crown Jewels of Britain. Lucara’s 1,109-carat Lesedi La Rona is the second-biggest, with the 995-carat Excelsior and 969-carat Star of Sierra Leone the third- and fourth-largest.  

    Weaker demand for diamonds, coupled with a growing supply glut, has pushed the IDEX diamond index lower and lower. With the industry in free-fall, has Gem with its monstrous 910-carat rock produced an artificial bottom or is this a head fake?

    asd

  • "The Whole World Is Sick And Tired Of US Foreign Policy"

    Authored by Darius Shatahmasebi via TheAntiMedia.org,

    https://www.zerohedge.com/sites/default/files/inline-images/20180116_FORPOL_0.png

    According to four-star General Wesley Clark, in a 1991 meeting with Paul Wolfowitz, then-under-secretary of defense for policy at the Department of Defense, Wolfowitz seemed a little dismayed because he believed the U.S. should have gotten rid of Saddam Hussein in Operation Desert Storm but failed to do so. Clark summarized what he says Wolfowitz said:

    “‘But one thing we did learn. We learned that we can use our military in the region, in the Middle East, and the Soviets won’t stop us. We’ve got about five or ten years to clean up those old Soviet client regimes, Syria, Iran, Iraq, before the next great superpower comes on to challenge us.’” [emphasis added]

    This was certainly the case in the years that followed, as the United States used the pretext of 9/11 to attack both Afghanistan and Iraq with little to no substantive resistance from the international community. This trend continued as the Obama administration heavily expanded its operations into Yemen, Somalia, Pakistan, and even the Philippines, to name a few, right up until the U.S. led a cohort of NATO countries to impose regime change in Libya in 2011.

    At the time, Russia withheld its veto power at the U.N. Security Council because it had received assurances that the coalition would not pursue regime change. After NATO forces began bombing Muammar Gaddafi’s palaces directly, a furious Vladimir Putin questioned: “Who gave NATO the right to kill Gaddafi?

    Following Gaddafi’s public execution on the streets of Sirte, Putin’s criticism of NATO’s betrayal went even further. He stated:

    “The whole world saw him being killed; all bloodied. Is that democracy? And who did it? Drones, including American ones, delivered a strike on his motorcade. Then commandos – who were not supposed to be there – brought in so-called opposition and militants and killed him without trial. I’m not saying that Gaddafi didn’t have to quit, but that should have been left up to the people of Libya to decide through the democratic process.”

    No one appreciated it at the time, but America’s unchallenged ability to intervene anywhere and everywhere it chooses ended on that day. Fast forward to Barack Obama’s plans to implement an extensive strike plan against the Syrian government in 2013, which never transpired due  strong Russian opposition and widespread protests in the U.S. A few years later, Russia directly intervened in Syria at the request of the Syrian government and effectively implemented its own no-fly zone in significant portions of the country. Donald Trump’s April 2017 strike on the Syrian government was only conducted after his administration first notified the Russians through a deconfliction hotline set up to manage the Syrian conflict.

    However, Russia isn’t the only country that is tired of America’s foreign policy, and the recent “emergency U.N. Security Council meeting” to discuss the current situation in Iran is a testament to that. Even Washington’s traditional allies cannot withhold their criticism of America’s desire to police the world.

    “However worrying the events of the last few days in Iran may be they do not constitute per se a threat to international peace and security,” French Ambassador to the U.N. Francois Delattre said“We must be wary of any attempts to exploit this crisis for personal ends, which would have the diametrically opposed outcome to that which is wished.”

    Russia went even further, bringing up America’s own behavior and treatment of protesters as a counter-argument to the notion that Washington is motivated by human rights concerns in Iran.

    “By your logic, we should have initiated a Security Council meeting after the well-known events in Ferguson,” said Russian U.N. Ambassador Vasily Nebenzya, addressing the U.S. delegation.

    Iran also insisted the matter was an internal affair and not something for the U.N. to weigh in on, and China agreed, with their ambassador calling it a purely “domestic issue.”

    French President Emmanuel Macron even went so far as to accuse the U.S., Israel, and Saudi Arabia of instigating a war with Iran.

    “The official line pursued by the United States, Israel and Saudi Arabia, who are our allies in many ways, is almost one that would lead us to war,” Macron told reporters, according to Reuters. Instead, Macron called for dialogue with Tehran as he warned against the approach adopted by the aforementioned three countries.

    Turkish President Recep Tayyip Erdogan also came to Iran’s aid during the protests with Turkey’s Foreign Minister Mevlut Cavusoglu, openly stating:

    “Iran’s stability is important for us…We are against foreign interventions in Iran.”

    At the end of last year, Erdogan stated that U.S. sanctions on Iran were not binding on Turkey as it sought to outmaneuver them. At the time, Hurriyet news quoted Erdogan as saying “[t]he world does not consist of the U.S. alone.”

    America’s influential decline was most evident in Donald Trump’s recent Jerusalem debacle, which saw the Trump administration issue stern threats to the entire world, warning they needed to vote in favor of Washington’s interests at the U.N. Most of the world chose to ignore those threats and gave the United States a giant “middle finger,” so to speak, voting overwhelmingly against the Trump administration.

    While Washington is more than capable of unilaterally attacking other countries both covertly and overtly with an ever depleting list of allies, what is becoming increasingly clear is that it may not be able to do so without active opposition from the rest of the world, including nuclear powers Russia and China, which refuse to stay silent as the U.S. tries to shape the world in accordance with its geopolitical desires.

  • Ford Profit, Outlook Miss Estimates Amid Dramatic Transformation Plan

    Having admitted last March that “used car prices will drop for years”  amid near record inventories, having reached a so-called ‘plateau’ in car sales, amid rising auto-loan losses, and less than a year after it fired 10% of its global workforce, on Tuesday afternoon Ford disappointed once again, reporting preliminary financial results for 2017 and guidance that fell short of investor expectations, in a downbeat forecast that contrasted with a more positive outlook from rival automaker General Motors.

     

    dfg
    The 2019 Ford Ranger

    In 2017 Ford said it would miss consensus estimates of $1.83, and will report adjusted earnings of $1.78 per share. For 2018, Ford expects adjusted earnings of $1.45 to $1.70 per share, below consensus of $1.62. Ford blamed exchange rates (which is odd since the dollar has been tumbling in recent months) and rising prices for the commodities used in its vehicles for the projected decline in 2018 adjusted earnings.

    Over the past year, Ford shares are up only about 4%, significantly trailing the 18% return of its arch-rival GM. Last May, Ford’s board ousted CEO Mark Fields and named Jim Hackett, who was known as a turnaround expert and had been leading Ford’s unit developing self-driving vehicles, to replace him. As Reuters reports, Hackett has promised to slash Ford’s product development costs by $14 billion and has launched reviews of the vehicle lineup.

    Ford’s disappointing forecast reinforces Hackett’s warning to investors from last fall that the cost-cutting and product strategy changes could take time.

    Ford CFO Bob Shanks told analysts at a Detroit investor conference organized by Deutsche Bank that higher costs for steel, aluminum and other metals, as well as currency volatility, would cost the company $1.6 billion in 2018, and while cost-cutting actions are under way, they will have the biggest impact “in 2020 and later,” Shanks said quoted by Reuters.

    “We are not satisfied by our performance,” Shanks said.

    * * *

    But the most surprising announcement of the day came from EVP and president of global markets Jim Farley who said that Ford is pivoting away from being a full-line automaker, and will shift to low volume, high margin cars, a substantial  metamorphosis for America’s premier auto brand.

    According to Farley, the company’s business structure was “out of sync with our revenue,” and vowed to cut costs by sharply reducing the variants of high-volume Ford models and slashing marketing costs by $200 million a year. Farley also hinted at possible significant changes in the structure of Ford’s money-losing South American business.

    Farley said that that Lincoln brand will orient toward SUVs, and that Ford will have 25 new model launches by end of 2019. He also cautioned that Ford profit would drop as electric car catch-up would be costly.

    ”We are exploring every option you can imagine,” Farley told analysts on the sidelines of the Detroit auto show.

    To boost revenue, Farley said Ford would decrease its passenger-car models and develop more trucks and sport utility vehicles aiming at profitable niches such as rugged off-road models. In all, Ford expects cars to drop below one-third of its total sales mix.

    And while the business transformation will take even longer than expected, the company decided to immediately reward its shareholders, and said it would pay shareholders an extra dividend of $500 million, or 13 cents a share, for the first quarter. Oh, and just to seal the deal, Ford said its employees would not be given pay increases or bonuses as a result of tax reform.

  • The FBI's Attacks On MLK Jr. Are Helpful Reminders For Today

    Authored by Ryan McMaken via The Mises Institute,

    Writing for the Wall Street Journal in 2005, federal judge and former U.S. deputy attorney general Laurence Silberman recalled how he was “shocked” to discover the extent the FBI abused its power to spy on Americans. 

     

    https://www.zerohedge.com/sites/default/files/inline-images/20180115_mlk_1.png

    Speaking of the first time he reviewed the files of J. Edgar Hoover, Silberman writes how Hoover tasked “his agents with reporting privately to him on any bits of dirt on figures such as Martin Luther King or their families — information Hoover sometimes used as blackmail to ensure his and the bureau’s power.”

    Silberman was writing of having first learned of these abuses of power back in the 1970s. Using a well-worn Hollywood cliché, one might say those days were a “more innocent time.” Nowadays it is widely known that the FBI was the personal playground of J. Edgar Hoover who employed the agency to punish his political enemies and gain compliance from others. 

    In spite of its claims, though, the FBI has never moved terribly far from its days as Hoover’s praetorian guard. Tellingly, the FBI still refuses to remove Hoover’s name from its headquarters in Washington, and the agency’s habit of routinely violating the privacy of American citizens is now institutionalized, rather than the product of any single man’s crusade. 

    Both James Bovard and Timothy Weiner have documented in many ways the FBI legacy of using its power to destroy political threats to its power, and to do so in extra-legal ways whenever deemed “necessary.” 

    Yesterday, Martin Luther King, Jr.’s birthday, offers an opportunity to focus on some of the methods employed by the FBI. As The Daily Caller reports today

    In addition to tapping King’s phones and bugging his hotel rooms, the FBI used darker methods to attack the civil rights leader.

    [The FBI] sent to King’s home a “suicide package” in 1964 that contained audio recordings of King’s extramarital trysts and an unsigned letter telling him “there is only one way out for you.” The letter, which was published in un-redacted form by The New York Times in 2014, threatened to make the recordings public unless King offed himself within 34 days.

    “King, there is only one thing left for you to do. You know what it is. You have just 34 days,” the letter stated. “There is but one way out for you. You better take it before your filthy, abnormal, fraudulent self is bared to the nation.”

    (The charges of “filthy” and “abnormal” are especially cute given the unorthodox sexual activities of Hoover and then-president Lyndon Johnson.)

    Paranoia at the FBI 

    King was just one of many targets of “COINTELPRO,” a series of often-illegal operations employed by the bureau to harass and persecute the federal government’s political enemies. 

    COINTELPRO, however, was just the manifestation of FBI paranoia in that specific era. The exact nature of the motivation changes over time. In the late ‘teens, the Palmer raids were employed to go after suspected Bolsheviks and “anarchists” in an extra-legal fashion. 

    In the 1920s, the FBI was spying on US Senators who were deemed insufficiently loyal to the US regime. Weiner explains

    By the time Congress reconvened in March 1923, [Attorney General Harry] Daugherty and [William J.] Burns were conducting political espionage against senators whom the attorney general saw as threats to America. The bureau was breaking into their offices and homes, intercepting their mail, and tapping their telephones, just as it had done to members of the Communist party. The only rationale was the political movement in the Senate toward American diplomatic recognition of Soviet Russia.

    After all, Weiner notes how in the early 20s, “Hoover and his General Intelligence Division warned constantly of a violent communist revolution.” Hoover happily used the paranoia he produced to increase his own political power.

    40 years later, the FBI was still at it, this time tapping King’s phone’s an an attempt to get him to kill himself.

    Today, though, the FBI and other American intelligence agencies are attempting to legalize what was once considered illegal, or at least of questionable legality. 

    What the FBI wants today are modern equivalents of Dan Brookman calls “modern-day writes of assistance” or blank-check warrants that enable federal agents to simply gather every bit of private information they can on private citizens. 

    As Judge Napolitano explains, the federal government is moving toward expanding the use of Foreign Intelligence Surveillance Act (FISA) warrants to enable agencies like the FBI to more easily use surveillance data against Americans: 

    If enacted, this radical, unconstitutional hole in the Fourth Amendment would bring the country full circle back to the government’s use of general warrants to harass and prosecute — general warrants so odious to our forebears that they took up arms against the king’s soldiers to be rid of them.

    Many Americans today like to comfort themselves with the idea that “I’m not involved in any threats to national security” or “I don’t associate with terrorists” and then think themselves immune from government abuses. 

    But Martin Luther King didn’t present any threat to national security either. He didn’t call for violent acts to be perpetrated against the American state. He was, however, a political thorn in the side of powerful Washington politicians, so the federal government turned to some of the things they do best. It turned to persecuting, threatening, and spying, in the hopes of doing away with an inconvenient person.

    King’s experience (and the COINTELPRO experience in general) today remain a healthy reminder of how the federal government operates and just how little regard it has for the law. One can only imagine how flimsy will be the limits imposed on FBI and other federal agencies should the current attacks on the Fourth Amendment succeed.

  • Ex-CIA Officer Suspected Of Helping China Assassinate US Informants Arrested At JFK

    A former CIA officer suspected of helping China identify the US spy agency’s informants was arrested at JFK International Airport on Monday on charges of unlawful retention of national defense information, according to the Department of Justice.

     

    sdf

    Many of the agency’s informants were killed in a “systematic dismantling of the C.I.A.’s spy network in China starting in 2010,” according to the New York Times, which notes it was one of the American government’s “worst intelligence failures in recent years.” 

    The arrest of the former agent, Jerry Chun Shing Lee, 53, capped an intense F.B.I. investigation that began around 2012 after the C.I.A. began losing its informants in China. Mr. Lee was at the center of a mole hunt in which some intelligence officials believed that he had betrayed the United States but others thought that the Chinese government had hacked the C.I.A.’s covert communications used to talk to foreign sources of information. –NYT

    “Jerry Chun Shing Lee, aka “Zhen Cheng Li”, 53 – a U.S. Citizen currently living in Hong Kong, began working for the CIA as a case officer in 1994, where he would spend the next 13 years with a Top Secret clearance and signing “numerous non-disclosure agreements,” according to a DOJ press release

    According to court documents, in August 2012, Lee and his family left Hong Kong to return to the United States to live in northern Virginia. While traveling back to the United States, Lee and his family had hotel stays in Hawaii and Virginia. During each of the hotel stays, FBI agents conducted court-authorized searches of Lee’s room and luggage, and found that Lee was in unauthorized possession of materials relating to the national defense.

    Specifically, agents found two small books containing handwritten notes that contained classified information, including but not limited to, true names and phone numbers of assets and covert CIA employees, operational notes from asset meetings, operational meeting locations and locations of covert facilities.

    Lee appeared in an New York courtroom Tuesday afternoon where he was ordered held without bail. He faces a maximum penalty of 10 years in prison if convicted. The case is being prosecuted by the U.S. Attorney’s Office for the Eastern District of Virginia. 

    Lee, 53, served in the U.S. Army from 1982 through 1986 and worked for the CIA between 1994 and 2007 according to an affidavit filed by an FBI agent. 

    The FBI agent wrote that Lee and his family left Hong Kong in August 2012 to travel to northern Virginia. Along the way, they stayed in hotels where the FBI found the books.

    The small books were discovered inside Lee’s luggage, sealed in a small clear plastic travel pack.

    The handwritten information inside ranged in terms of classification, but the agent said at least one page contained top secret information, “the disclosure of which could cause exceptionally grave damage to the national security of the United States.”Reuters

    The FBI agent’s affidavit also noted that classified cables written by Lee while he was a case officer describing his interactions with CIA informants corroborated what was found in the two books. 

    Lee was interviewed five times by the FBI according to Reuters, never disclosing that he had the books. He also met with former CIA colleagues around that time without returning the classified materials, said the Justice Department.

     

    asd

    Over a dozen CIA informants were imprisoned or killed by the Chinese government, a serious setback for the agency, as discussed here first last May: 

    The Chinese government systematically dismantled C.I.A. spying operations in the country starting in 2010, killing or imprisoning more than a dozen sources over two years and crippling intelligence gathering there for years afterward.

    Current and former American officials described the intelligence breach as one of the worst in decades. It set off a scramble in Washington’s intelligence and law enforcement agencies to contain the fallout, but investigators were bitterly divided over the cause. Some were convinced that a mole within the C.I.A. had betrayed the United States. Others believed that the Chinese had hacked the covert system the C.I.A. used to communicate with its foreign sources. Years later, that debate remains unresolved.

    But there was no disagreement about the damage. From the final weeks of 2010 through the end of 2012, according to former American officials, the Chinese killed at least a dozen of the C.I.A.’s sources. According to three of the officials, one was shot in front of his colleagues in the courtyard of a government building — a message to others who might have been working for the C.I.A. –NYT

    By the end of 2011, senior CIA officials realized they had a problem; their assets in China were disappearing. The FBI and CIA opened a joint investigation in response, run by top counterintelligence officials out of an office in Northern Virginia – code named “Honey Badger.” 

    As more and more sources vanished, the operation took on increased urgency. Nearly every employee at the American Embassy was scrutinized, no matter how high ranking. Some investigators believed the Chinese had cracked the encrypted method that the C.I.A. used to communicate with its assets. Others suspected a traitor in the C.I.A., a theory that agency officials were at first reluctant to embrace — and that some in both agencies still do not believe. –NYT

    Read more about the case here

     

  • DHS Report: 3 Of Every 4 Terrorism Offenders Since 9/11 Were Foreign-Born

    Authored by Will Racke via The Daily Caller,

    The Department of Homeland Security released Tuesday a study that sheds new light on the connection between the U.S. immigration system and so-called homegrown terrorism.

    https://www.zerohedge.com/sites/default/files/inline-images/20180116_foreign.png

    Of the 549 people convicted of international terrorism-related charges between Sept. 11, 2001 and and the end of last year, 402  — 73 percent — were foreign-born, according to the DHS report.  Of those, 148 had become naturalized U.S. citizens before committing terrorism offenses.

     

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    DHS Secretary Kirstjen Nielsen says the findings suggest the U.S. needs to improve its immigration vetting process, to include screening certain immigrants after they arrive.

    “I think what we take directly away from the report is we need to continue to enhance our screening and vetting,” she told CBS’ John Dickerson on Tuesday.

    “But it also tells us we need to continually vet those who are here. We have examples unfortunately over the last decades of terrorist attacks from legal permanent residents and others who were naturalized.”

    The DHS study follows a spate of recent terror-related offenses allegedly committed by foreign-born people who had immigrated to the U.S. through legal channels. The suspects two incidents in New York City – a deadly truck rampage in October and an attempted suicide bombing in December – had arrived through the diversity visa lottery and on a family preference visa, respectively.

    Last month, a naturalized U.S. citizen from Pakistan named Zoobia Shahnaz was indicted for allegedly laundering more than $85,000 through Bitcoin and other cryptocurrencies to fund Islamic State fighters overseas. Shahnaz came to the U.S. came to the U.S. on an F43 family-preference visa, which is granted to the children of siblings of U.S. citizens, according to DHS.

    Trump administration officials have pointed to the incidents as evidence of public safety and national security vulnerabilities in the U.S. immigration system. Shortly after taking office, Nielsen backed Attorney General Jeff Sessions – the administration’s leading immigration hawk – in calling for tighter limits on extended-family migration and ending the green card lottery.

    *  *  *
    Full Report below…

     

  • US And China Brace For Trade War That Could Rattle Global Economy

    As we reported last week, the US non-petroleum trade deficit with China and Mexico – two of its largest trading partners – climbed to its highest level for a 12-month period in December, an embarrassing development for the Trump administration, which has repeatedly promised to protect US industry by raising trade barriers.

    However, the rising deficit, bolstered by a weakening US dollar, could ratchet up the political urgency of the Trump administration’s trade agenda. And as the Wall Street Journal points out, the White House is preparing a mix of tariffs and quotas to confront the growing economic threat from China. Though this confrontation could be potentially disruptive for the global system of free trade, even potentially leading to the collapse of the World Trade Organization, a group the Trump administration believes China should never have been allowed to join.

    In his column, the WSJ’s Andrew Browne points out that the last time the US became embroiled in a trade war, Ronald Reagan was president. And its adversary was a close US ally: Japan.

     

    China

    At the time, Japan’s economy was much smaller than the US economy. Today, the Chinese economy has by some measures eclipsed the US. Such an unprecedented trade showdown between the US and China could have far reaching ramifications.

    A trade war isn’t a certainty, but if it comes, it will look nothing like the battles that raged in the 1980s over Japanese semiconductors, cars and TV sets.

    The forces are more evenly matched this time: America has never faced off in a trade skirmish with an opponent like China in terms of economic size, industrial capabilities and global ambitions.

    Japan was a U.S. ally, China increasingly a rival. That raises the risk of tit-for-tat escalation, especially since support for Beijing is crumbling across the U.S. political spectrum as well as in the U.S. business community, traditionally a strong advocate for China trade.

    Anti-trade rhetoric has been embraced by both sides, with President Donald Trump’s “America First” proclamations and President Xi Jinping’s “Chinese Dream” scenario.

    In this brewing battle fueled by protectionists in both camps (Mr. Trump’s “America First“ finds its nationalist counterpoint in President Xi Jinping’s “China Dream”), each side has an exaggerated sense of its own advantages.

    “A trade war is coming because of ideological zealotry and absolutely contradictory estimates of who has more leverage,” says Scott Kennedy, an expert on Chinese industrial policy at the Center for Strategic and International Studies, a Washington-based think tank.

    Global markets are wildly unprepared for a full-blown China-US trade war, WSJ  reports. Earlier this month, the Eurasia Group highlighted “protectionism” as one of the biggest geopolitical risks of 2018. One of the reasons, Eurasia Group argues, is because industrialized economies are embracing a wider tool chest of pro-trade measures, including indirect subsidies and bailouts.

    Governments aren’t just trying to protect comparative advantages in traditional sectors such as agriculture, metals, chemicals, and machinery out of concern for lost jobs or domestic economic interests. They’re also intervening in the digital economy and innovation-intensive industries as protecting intellectual property becomes an increasingly important priority.

    But instead of traditional measures such as import tariffs and quotas, today’s tools of choice include “behind-the-border” measures such as bailouts, subsidies, and “buy local” requirements designed to bolster domestic companies and industries. These measures don’t necessarily circumvent WTO commitments; they rely on a collective inability to update and strengthen existing global trade rules.

    WSJ  agrees: Once under way, the repercussions of a trade war would be felt well beyond the combatants themselves. US friends and allies along Asian supply chains would be early collateral damage. China is still to a large extent the final assembly point for imported high-tech components from Japan, South Korea and Taiwan. Navigating increasingly complex global supply chains in a constant state of disruption would be hugely problematic for businesses across industries.

    Furthermore, if it escalated far enough, a trade war could take down the entire global trading architecture. That could be Trump’s goal. Many in his administration, including trade representative Robert Lightizer, believe the biggest mistake the US ever made was to usher China into the World Trade Organization in 2001. Aides say Trump regularly threatens to pull out of the rules-setting body.

    Trump has in the past suggested that Chinese help on North Korea could head off US trade action. In a phone call  with the US president on Tuesday, Xi suggested that trade issues should be resolved by “making the cake of cooperation bigger.”

    Meanwhile, Trump expressed disappointment that the US trade deficit with China has continued to grow” and made clear that “the situation is not sustainable.”

    In private, however, senior Chinese officials believe Beijing has many tactical advantages: Some are cultural – the Chinese people, one says, are more prepared to endure economic hardship.

     

    Surplus

    Perceptions of US bullying would rally the population around the Communist Party, whereas US opinion would fracture among constituencies for and against trade hostilities.

    US manufacturing giants like Boeing in General Motors would probably throw a fit and withdraw their support for Trump and his agenda. Both companies see China’s economy, which is fairly open relative to Japan’s in the 1980s, as a crucial growth market. If US initiates a trade war – something that Trump has already threatened with his investigation into Chinese IP practices – China has a detailed game plan to respond, and the total flexibility to carry it out. For example, the Chinese government would abandon Boeing in favor of European Airbus. Diversifying soybean supplies – possibly relying more on Brazil – would be another option.

    Browne says the US should count on Chinese retaliatory actions being highly targeted – state by state, congressional district by congressional district – to inflict the maximum US job losses, and single out those politicians most gung-ho about trade action.

    Many US trade experts don’t mince words: They believe China would prevail in a trade war with the US, and that the US economy would suffer lasting damage.

    Nicholas Lardy, a senior fellow at the Peterson Institute for International Economics, thinks China would win. Among his reasons: China’s ability to concentrate pain, and the outcry from affected businesses in America’s more open political system. He argues that “the political costs to the Trump administration of maintaining new protectionist measures will be much higher than the costs of retaliation to the Xi regime.”

    Derek Scissors, a trade expert at the American Enterprise Institute argues that the major US advantage is that China is far more dependent on trade for its financial health.

    “A shorter, smaller-scale trade conflict favors China due to its comparative agility,” he says. “The more serious it gets, the worse China would fare because it’s badly outmatched monetarily.”

    In the 1980s, Japan had to back down, agreeing to voluntary export restraints and moving large parts of its auto manufacturing base to the US to create jobs and defuse tensions. China won’t be pushed around in the same way.

    Still, China has other leverage: Rumblings about China ditching Treasurys – reports that have been denied by Chinese authorities but still managed to rattle markets – show the PBOC might be willing to use its balance sheet as leverage against the US.

    And as central banks across Europe flock to the yuan, the US could be increasingly vulnerable to rising interest rates as its share of global reserves dwindles.

     

  • Silver: Once And Future Money

    Authored by James Rickards via The Daily Reckoning,

    The Roman Republic and the later Roman Empire had gold coins called the aureus and solidus, but they also minted a popular silver coin called the denarius. One denarius was the daily wage for unskilled labor and Roman soldiers.

    Of course, in the late Empire, the aureus, solidus and denarius were all debased by mixing the gold and silver with base metals. The decline of the Roman Empire went hand in hand with the decline of sound money.

    In the early ninth century AD, Charlemagne greatly expanded silver coinage to compensate for a shortage of gold. This was successful in stimulating the economy of the predecessor of the Holy Roman Empire. In a sense, Charlemagne was the inventor of quantitative easing over 1,000 years ago. Silver was his preferred form of money.

    Under the U.S. Coinage Act of 1792, both gold and silver coins were legal tender in the U.S. From 1794 to 1935, the U.S. Mint issued “silver dollars” in various designs. These were widely circulated and used as money by everyday Americans. The American dollar was legally defined as one ounce of silver.

    The American silver dollar of the late eighteenth century was a copy of the earlier Spanish Real de a ocho minted by the Spanish Empire beginning in the late sixteenth century. The English name for the Spanish coin was the “piece of eight,” (ocho is the Spanish world for “eight”) because the coin could easily be divided into one-eighth pieces.

    Until 2001 stock prices on the New York Stock Exchange were quoted in eighths and sixteenths based on the original Spanish silver coin and its one-eight sections.

    Until 1935 U.S. silver coins were 90% pure silver with 10% copper alloy added for durability. After the U.S. Coinage Act of 1965, the silver content of half-dollars, quarters and dimes was reduced from 90% to 40% due to rising price of silver and hoarding by citizens who prized the valuable silver content of the older coins.

    The new law signed by President Johnson in 1965 marked the end of true silver coinage by the U.S. Other legislation in 1968 ended the redeemability of old “silver certificates” (paper Treasury notes) for silver bullion.

    Thereafter, U.S. coinage consisted of base metals and paper money that was not convertible into silver; (gold convertibility had already ended in 1933).

    Let’s hope that the U.S. is not following in the footsteps of the Roman Empire in terms of a political decline coinciding with the substitution of base metals for true gold and silver coinage.

     

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    In 1986, the U.S. reintroduced silver coinage with a .999 pure silver one-ounce coin called the American Silver Eagle. However, this is not legal tender although it does carry a “one dollar” face value. The silver eagle is a bullion coin prized by investors and collectors for its silver content. But it is not money.

    Who in their right mind would pay a full ounce of silver for goods or services worth only a buck?

    In short, silver is as much a monetary metal as gold, and has just as good a pedigree when it comes to use in coinage. Silver has supported the economies of empires, kingdoms and nation states throughout history.

    It should come as no surprise that percentage increases and decreases in silver and gold prices denominated in dollars are closely correlated.

    Silver is more volatile than gold and is more difficult to analyze because it has far more industrial applications than gold. Silver is useful in engines, electronics and coatings.

    Interestingly, gold is used very little other than as money in bullion form. Gold has some highly specialized uses for coating and ultra-thin wires, but these are a very small part of the gold market.

    Both gold and silver are used extensively in jewelry. I consider jewelry to be “wearable wealth” and akin to bullion rather than a separate market segment.

    Because silver has more industrial uses than gold, the price can rise or fall based on the business cycle independent of monetary considerations. However, over long periods of time, monetary and bullion aspects tend to dominate industrial uses and silver closely tracks its close cousin gold in dollar terms.

    While gold and silver prices have a high correlation, the correlation is not perfect. There are times where gold outperforms silver and vice versa. Right now we are in a sweet spot for silver.

    Gold is performing well, and silver is performing even better!

     

    https://www.zerohedge.com/sites/default/files/inline-images/20180116_silver1.png

    The latest data is telling me that silver prices are set to rally. This conclusion is based in part on a bull market thesis for gold.

    Gold staged an historic rally from 1999 to 2011, from about $250 per ounce to $1,900 per ounce, a gain of about 900% in that twelve-year span. Since then, gold prices fell in a 50% retracement (using the 1999 base) and bottomed at around $1,050 per ounce in December 2015.

    Secular bull and bear market tops and bottoms are difficult to see in real time, but they become apparent with hindsight. Gold gained over 23% in 2016-2017. From the perspective of early 2018, it is clear than the gold bear market ended over two years ago and a new multi-year secular bull market has begun.

    Silver is not only along for the ride, it is showing even better performance than gold, albeit with greater volatility. Both the gold and silver rallies are based on a combination of supply/demand fundamentals, geopolitical pressures creating safe haven demand, and increasing inflation expectations as confidence in central banking and fiat money erodes.

    In addition, silver has an excellent technical set-up right now. Precious metals analyst Samson Li writing in Thomson Reuters on January 2, 2018 offers this insight in the current technical trading position for silver:

    Technically, silver is ripe for a major breakout to the upside in 2018. The CFTC figures Managed Money positions show that COMEX silver has been in a net short for three straight weeks since 12th December. This is not unheard of but is relatively rare for silver; the last time COMEX silver was net short was between the end of June and the first week of August 2015.

    As investment sentiment can swing from one extreme to another, and given silver’s innate volatility, this net short position should point to the possibility of a sharp short-covering rally. Looking back at the corresponding period in 2015, silver price was trading at $15.61/oz on the 7th July, and it was the third consecutive week recording a net short position. Approximately a year later, silver was trading over $20/oz in July 2016…

    [T]he current poor sentiment does suggest that silver could be one of the better performing precious metals in 2018, barring any crisis that could trump most of the commodities but gold.

    The good news is that this secular rally in silver is in its early days. Recent gains will be sustained and amplified in the months and years to come.

    Silver will outperform gold in the short-run, and shares in well-managed silver mining companies will do even better than silver.

  • China's 'Nasdaq' Tumbles To 6-Month Lows As Crypto-Related Stocks Crash

    CHINEXT – China’s index of small cap and tech stocks – has tumbled in the last few days (while the major Chinese indices have risen), as blockchain-related stocks across Asia have crashed along with the cryptocurrency carnage.

    As Bloomberg notes, stocks with exposure to digital currencies decline in Asia after Bitcoin and rival cryptocurrencies slumped Tuesday amid fears of regulatory crackdowns. Bitcoin pares some of loss with 5.6% gain as of 10:03am in Hong Kong.

    • Japan: Ceres Inc. -9.8%, GMO Internet Inc. -7.2%, Infoteria Corp. -5.1%, SBI Holdings Inc. -5%, Fisco Ltd. -5.4%, Remixpoint Co. -4.4%, Metaps Inc. -4.6%
    • Korea: Vidente Co. -18%, Omnitel Inc. -13%, Kakao Corp. -3.2%
    • China: Ygsoft Inc., Brilliance Technology Co. and Shenzhen Forms Syntron Information Co. all tumble by 10% daily limit

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    While The Shanghai Composite and Shenzhen CSI-300 Index are pushing to new highs, tech-heavy Shenzhen Composite and CHINEXT are tumbling…

     

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    This the 4th down day in a row – the longest streak since November – to the lowest since July…

     

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    Notably the SHCOMP and CHINEXT are drastically diverging – now at their widest divergence in 3 years…

     

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Today’s News 16th January 2018

  • Paul Craig Roberts: "Amnesty International Is Barking Up The Wrong Tree"

    Authored by Paul Craig Roberts,

    I have received a letter from Margaret Huang, Amnesty International’s executive director.

    She is fundraising on the basis of President Trump’s “chilling disregard for our cherished human rights” and his exploitation of “hatred, misogyny, racism and xenophobia,” by which he has “emboldened and empowered the most violent segments of our society.”

    Considering the hostility of Identity Politics toward Trump, one can understand why Ms. Huang frames her fundraiser in this way, but are the Trump deplorables the most empowered and violent segments of our society or is it the security agencies, the police, the neoconservatives, the presstitute media, and the Republican and Democratic parties?

     

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    John Kiriakou, Ray McGovern, Philip Giraldi, Edward Snowden, and others inform us that it is their former employers, the security agencies, that are empowered by unaccountability and violent by intent. Certainly the security agencies are emboldened by everything they have gotten away with, including their conspiracy to destroy President Trump with their orchestration known as Russiagate.

    The violence that the US government has committed against humanity since the Clinton regime attacked Serbia was not committed by Trump deplorables. The violence that has destroyed in whole or part eight countries, murdering, maiming, and displacing millions of peoples, was committed by the Clinton, George W. Bush, and Obama regimes, their secretaries of state such as Hillary Clinton, their national security advisers, their military and security establishments, both parties in Congress. The murder of entire countries was endorsed by the presstitute media and the heads of state of Washington’s European, Canadian, Australian, and Japanese vassals. Trump and his deplorables have a long way to go to match this record of violence.

    Whether she understands it or not, Ms. Huang with her letter is shifting the violence from where it belongs to where it does not. The consequence will be to increase violence and human rights violations.

    The most dangerous source of violence that we face is nuclear Armageddon resulting from the neoconservative quest for US hegemony. Since the Clinton regime every US government has broken tension-easing agreements that previous administrations had achieved with Moscow. During the Obama regime the gratuitous aggressions and false accusations against Russia became extreme.

    Why doesn’t Amnesty International address the reckless and irresponsible acts of the US government that are violating the rights of people in numerous countries and pushing the world into nuclear war? Instead, there have been times when Amnesty International aligns with Washington’s propaganda against Washington’s victims.

    By jumping on the military/security complex’s “get Trump movement”, human rights and environmental organizations have increased the likelihood that rights and environment will be lost to war.

    There can be no doubt that Trump is undoing past environmental protections and opening the environment and wildlife to more destruction. However, the worst destruction comes from war, especially nuclear war.

    Would things be different if the liberal/progressive/left had rallied to Trump’s support in reducing tensions with Russia, in normalizing the hostile relations that Obama had established with Moscow? Would the support of the liberal/progressive/left have helped Trump resist the pressures from the neoconservative warmongers? In exchange for support for his principal goal, would Trump have mitigated industry’s attacks on the environment and vetoed the renewal of the Foreign Intelligence Surveillance Act that violates human rights?

    We will never know, because the liberal/progressive/left could not see beyond the end of its nose to comprehend what it means for the environment and for human rights for nuclear powers to be locked into mutual suspicion.

    Thanks to the failure of the liberal/progressive/left and to the presstitute media to understand the stakes, the military/security complex has been successful in pushing Trump off his agenda. The damage that a mining company and offshore drilling can do to the environment is large, but it pales in comparison to the damage from nuclear weapons.

  • 80% Of All Bitcoins Have Already Been Mined…

    Almost exactly 9 years after the first were ‘mined’, January 13th marked an important milestone for cryptocurrencies. 16.8 million bitcoins (BTC), or 80 percent of the entire Bitcoin supply, have now been mined.

     

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    Source

    As CoinTelegraph reports, this means only 4.2 million bitcoins, or 20 percent, are left to mine until Bitcoin’s 21 million supply cap is reached.

    https://www.zerohedge.com/sites/default/files/inline-images/20180115_btc2.png

    BTC contains the 21 mln cap built into its protocol by Satoshi Nakamoto, first mentioned in their 2008 White Paper, as a way to introduce digital scarcity to cryptocurrency. With such a cap in place, the more bitcoins are mined, the more scarcity is produced on the market.

    Scarcity arguably creates demand, which in turns makes the coins more valuable. Once 21 million bitcoins have been mined, it will become even harder to obtain them, also potentially making each coin more valuable.

    Miners currently receive a 12.5 BTC reward for every block that they mine, but Nakamoto’s protocol also requires that the mining reward is halved every 210,000 blocks, or approximately four years. The next miner halving will take place within two years, approximately in early June 2020 depending on hashrate, bringing the rewards down to 6.25 BTC per mined block.

    Not every digital currency is mineable like BTC. Some cryptocurrencies are created with the entire supply released all at once, in which case the total supply is either held or in circulation and there is no way to “mine” or mint new coins.

    Some examples of non-mineable digital currencies are Ripple, IOTA, NEM, NEO, Qtum, Omisego, Lisk, Stratis, Waves, and EOS.

    Increasing supply

    Skeptics have proposed that it is theoretically possible to increase Bitcoin’s 21 million capped supply of Bitcoin via a 51 percent or a Sybil attack, but so far neither of these manipulations has proven feasible in the case of BTC.

    Altcoin Krypton, which is based on Ethereum, experienced a 51 percent attack in August 2016, but no other such attacks have taken place since then.

  • Putin Plot? Democrats Ridiculed For Claiming Moscow Behind Chelsea Manning's Senate Run

    Within hours of young trans woman whistleblower Chelsea Manning announcing her run for Senate against Benjamin Cardin, a 74-year-old white, straight man, establishment Democrats wasted no time in mocking and denouncing her bid, even embarrassing themselves by proclaiming it a Kremlin-engineered plot.

     

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    Anti-Russia conspiracy theorists have developed another outlandish claim, stating that Moscow is behind Chelsea Manning’s Senate bid, since she’s taking on an incumbent who is against so-called “Russian aggression.”

    Manning says she’s running because “we need someone willing to fight… we need to stop expecting that our systems will somehow fix themselves.”

    But, as RT notes, that reason seems too straightforward for those who apparently believe that everything related to US politics is somehow tied to Russia.

    Taking to Twitter on Saturday, foreign policy and strategy consultant Molly McKew called Manning’s decision to run “a little too convenient,” noting that she is running against Senator Ben Cardin, who is “one of [the] most active senators on foreign policy and [a] leader in making policy/legislation to respond to Russian aggression.”

     

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    In a separate tweet, RT reports that she referenced Manning’s whistleblowing and the apparent motive behind it. “The agent of a foreign power coerced this individual, leveraging their emotional distress, into breaking their oath to the country and disclosing classified secrets.”

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    If McKew’s remarks seem hard to comprehend, that’s perfectly understandable. If you need them to be interpreted, it all boils down to the same old line: Russia did it. That’s right. Russia is responsible for Manning’s whistleblowing, and Russia is somehow behind her decision to run for office.

    Her statements were called out by The Intercept’s Glenn Greenwald, the journalist who helped make Edward Snowden’s whistleblowing a reality. “One of the media’s favorite Russia-obsessed ‘experts’ didn’t even wait an hour before depicting Chelsea Manning’s Senate candidacy as a dastardly Kremlin plot,” he tweeted. He went on to call out the “demonstrable, obvious falsehoods about Manning’s motives & WikiLeaks’ role” which McKew wrote about in her second tweet

     

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    But McKew isn’t alone in her bold statements. A person by the name of Josh Manning, whose Twitter account says he is a civil rights investigator and something to do with “Army intel,” seems to believe the same.

    “Senator Cardin authored and released a 200-page masterpiece on Russian influence in western elections. Suddenly he has a primary from Kremlin stooge Assange’s Wikileaks primary source Chelsea Manning. The Kremlin plays the extreme left to swing elections. Remember that,” he wrote.

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    Greenwald also chimed in on Josh Manning’s tweet. “Oh my God: This is how deranged official Washington is. The president of the largest Dem Party think-tank (funded in part by dictators) genuinely believes Chelsea Manning’s candidacy is a Kremlin plot. Conspiracy theorists thrive more in mainstream DC than on internet fringes.”

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    We leave it up to the exquisitely mocking words of Greenwald to conclude:

    This conspiracy theory mocks itself.

    The idea that Vladimir Putin sat in the Kremlin, steaming over Benjamin Cardin’s report on Russia, and thus developed a dastardly plot to rid himself of his daunting Maryland nemesis – “I know how to get rid of Cardin: I’ll have a trans woman who was convicted of felony leaking run against him!” – is too inane to merit any additional ridicule.

    But this is the climate in Washington: no conspiracy theory is too moronic, too demented, too self-evidently laughable to disqualify its advocates from being taken seriously – as long as it involves accusations that someone is a covert tool of the Kremlin.

    Well said.

  • Only 1-In-3 Americans Think Michael Wolff's Book Is Credible

    Michael Wolff’s new book “Fire and Fury” has proven explosive, sending shockwaves across Washington and beyond.

    In its first week of publication, it sold 29,000 copies according to NBD BookScan with digital sales reaching an estimated 250,000. President Trump has claimed Wolff was not provided with access to the White House and that the book is “full of lies, misrepresentations and sources that don’t exist”.

    White House press secretary Sarah Huckabee Sanders also labeled Fire and Fury “complete fantasy”.

    Wolff has defended himself against that criticism, insisting Trump is “a man who has less credibility than, perhaps, anyone who has ever walked on earth.”

    Notably, however, Wolff did include a note at the beginning of the book where he says some of his sources were definitely lying to him while others offered contradictory reports, and this has cast doubt on the book’s credibility. 

    The end result of the sensational spat between Trump and Wolff is that the book is flying off the shelves.

    But, given its success, Statista’s Niall McCarthy asks (and answers) what does the American public make of its accuracy?

    Infographic: Do Americans Think Michael Wolff's Book Is Credible?  | Statista

    You will find more statistics at Statista

    A new Morning Consult/Politicopoll has found that a third of registered voters (32 percent) think the book is very or somewhat crediblewhile a quarter (25 percent) consider it not too or not at all credible. 20 percent of respondents either haven’t heard of it or have no opinion.

    When it comes to political affiliation, unsurprisingly, 46 percent of Democrats view the book as credible while percent think it’s inaccurate.

    Among Republicans, a 38 percent majority are skeptical about Fire and Fury while just under a quarter find it very or somewhat credible.

  • This Town Is Proof That Trump's Wall Can Work

    Authored by Paul Sperry, op-ed via The New York Post,

    When charges of “racism” and “xenophobia” fail, Democrats’ fallback argument against President Trump’s proposed border wall is that it simply “won’t work,” so why waste billions building it? Tell that to the residents of El Paso, Texas.

     

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    Federal data show a far-less imposing wall than the one Trump envisions – a two-story corrugated metal fence first erected under the Bush administration – already has dramatically curtailed both illegal border crossings and crime in Texas’ sixth-largest city, which borders the high-crime Mexican city of Juarez.

    In fact, the number of deportable illegal immigrants located by the US Border Patrol plummeted by more than 89 percent over the five-year period during which the controversial new fence was built, according to Homeland Security data reviewed by me. When the project first started in 2006, illegal crossings totaled 122,261, but by 2010, when the 131-mile fence was completed from one end of El Paso out into the New Mexico desert, immigrant crossings shrank to just 12,251.

    They hit a low of 9,678 in 2012, before slowly ticking back up to a total of 25,193 last year. But they’re still well below pre-fence levels, and the Border Patrol credits the fortified barrier dividing El Paso from Mexico for the reduction in illegal flows.

    And crime abated with the reduced human traffic from Juarez, considered one of the most dangerous places in the world due to drug-cartel violence, helping El Paso become one of the safest large cities in America.

    Before 2010, federal data show the border city was mired in violent crime and drug smuggling, thanks in large part to illicit activities spilling over from the Mexican side. Once the fence went up, however, things changed almost overnight. El Paso since then has consistently topped rankings for cities of 500,000 residents or more with low crime rates, based on FBI-collected statistics. The turnaround even caught the attention of former Homeland Security Secretary Janet Napolitano and other Obama administration officials, who touted it as one of the nation’s safest cities while citing the beefed-up border security there.

    Federal data illustrates just how remarkable the turnaround in crime has been since the fence was built. According to FBI tables, property crimes in El Paso have plunged more than 37 percent to 12,357 from their pre-fence peak of 19,702 a year, while violent crimes have dropped more than 6 percent to 2,682 from a peak of 2,861 a year.

    The overall crime rate in El Paso continued to fall last year, prompting city leaders to trumpet the good news in a press release that noted, “Because El Paso is a border town, its low crime rate may surprise you.”

    El Paso City Manager Tommy Gonzalez boasted that the city will “continue to lead our country in public safety.”

    Another core promise made by Trump to justify constructing a massive wall spanning from Texas to California is that it will slow the flow of drugs coming across the border from Mexico.

    “We need the wall for security. We need the wall for safety,” Trump said last week while answering questions about the sweeping new GOP immigration bill. “We need the wall for stopping the drugs from pouring in.”

    On that score, El Paso already has exceeded expectations.

    Drug smuggling along that border entry point has also fallen dramatically. In fact, since the fence was completed, the volume of marijuana and cocaine coming through El Paso and seized by Border Patrol agents has been cut in half.

    The year before the wall was fully built in 2010, the volume of illegal drugs confiscated by the feds along the El Paso border hit 87,725 pounds. The year after, the amount of drug seizures plummeted to 43,783 pounds. Last year, they dropped even further to a total of 34,329, according to Border Patrol reports obtained by The Post.

    All told, a legion of empirical evidence supports the idea a southern border wall could, in fact, work. There is also anecdotal evidence. In local press accounts, El Paso residents and business owners alike have praised the fence, citing it as an effective deterrent to both illegal crossings and crime.

    Now Trump plans to build a possibly bigger deterrent.

    The existing fence along the El Paso sector, which is made of a combination of corrugated steel and metal meshing, towers 21-feet high at some points and is already hard to climb. But the Trump wall, which will begin construction in El Paso, will be even taller and have multiple layers of security.

    Still, Democratic leaders are adamantly opposed to it. They argue the $18 billion wall won’t work to keep out illegal immigrants and drugs, and will only be a massive waste of tax dollars.

    “We think, frankly, the building of the wall, its cost is not justified either by its efficiency or effectiveness,” House Minority Whip Rep. Steny Hoyer (D-Md.) said Thursday.

    Even local Democrats are arguing with success.

    “That wall in itself is a racist reaction to a racist myth that does not reflect the reality of this country at all,” said Rep. Beto O’Rourke (D-El Paso).

  • From Shahs To The CIA: The History Of Western Intervention In Iran – Part 2

    In part 1 we examined the early history of the West’s domination of Persian natural resources, especially the establishment and rise of the Anglo-Persian Oil Company which led to multiple 20th century British interventions in Iranian politics in an attempt to ensure permanent access to oil. Part 2 tells the story of Operation Ajax.  

    “The Empire Must Go On”

    Once Europe erupted in world war (WWI), the British dispatched their armed forced to refineries all over Iran in order to protect what they considered their property – Iranian oil.  After the cessation of hostilities in 1919, the British bribed and intimidated the new regime of Ahmad Shah into accepting the terms of the much hated Anglo-Persian Agreement which in all but name, made Iran a protectorate of the British Empire.  No longer would the Iranians control their own army, transportation system, and communications network.  It all passed under the control British occupiers and with it the last vestiges of Iranian sovereignty. This once again ignited the fervent nationalist spirit across Iran and new rounds of protests and opposition.

    Even the U.S. president, Woodrow Wilson, disapproved of the agreement.  But, true to their colonial and imperialist spirit, the British rebuffed such protestations and opposition by saying, “These people have got to be taught at whatever cost to them, that they cannot get on without us.  I don’t at all mind their noses being rubbed in the dust.”  The empire must go on.

    The opening sequence from the 2012 movie ‘Argo’ features a brief history of aggressive Western intervention which shaped modern Iran.

    And go on it did, fueled by the black gold that flowed beneath the Iranian deserts. For the next thirty years, relations between the Iranians and the British revolved mainly around oil. The British deposed and installed new kings, and prime ministers and members of Iranian parliament were bought off to help ensure the Anglo-Persian Oil Company (by that time renamed the Anglo-Iranian Oil Company, or AIOC) had a free hand in the exploration, refining, and exportation of Iranian oil.  For that was indeed the bottom line for the British – the Iranian venture was extremely profitable for the them.

    Churchill’s Dream Prize

    Indeed, for Churchill, it was, “a prize from fairyland beyond our wildest dreams.” When they started in 1913, the British were extracting only 5,000 barrels of oils per day, and by 1950 they were extracting 664,000 per day.  Had the wealth from the oil been humanely shared with the Iranian people, the Iranians themselves likely would have seen such growth as part of a mutually beneficial relationship and endeared them to the English.  However, the long list of grievances hardened the hearts of the average Iranians and confirmed what they had long known: Britain was an empire whose only objective was preserving its interests, whatever the costs to Iranians, notwithstanding British protestations to the contrary.

    It is easy enough, however, to see why the British were prepared to go to the extreme to protect their direct access to cheap Iranian oil.  Iranian oil was vital, not only to the Royal navy, but to the entire economy of Great Britain and their way of life.  It fueled their industries and growing automobile culture. The AIOC was a vast company with seemingly limitless profits and resources, yet it sought still more from the Iranians.  From the British perspective the situation seemed like good capitalism, but from the perspective of the average Iranian, their British “benefactors” were greedy imperialists who were prepared to suck Iran dry.

    The majles (Iranian parliament, which held its first session in 1906), weakened though it was, gradually regained strength throughout the late 20s, 30s, and 40s, mainly from the rise of anti-British and anti-Shah sentiment coursing through the nation.  The majles forced the Shah and the oil companies to come to the negotiating table time and a again seeking just compensation and to redress the wrongs commited by the oil company. The list of grievances was indeed long.  At the top was the irregular bookkeeping that systematically deprived them of their contractual rights to royalties.  Instead of calculating the Iranian 20 percent before taxes, the British calculated the Iranians their portion after they had already sent huge sums to the British treasury, which meant, the Iranians received much smaller royalties.

     

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    Recently declassified documents like the above ‘The Battle for Iran, 1953’ (Contents page: view more here) tell the CIA’s secret internal history of the 1953 coup. It was only in 2013 that the CIA formally acknowledged its role in bringing down the Mossadegh government after the agency was forced to declassify and publish secret documents related to Operation Ajax, (and first disclosed by The New York Times’ James Risen) and to this day most Americans are unaware that it happened.  

    Additionally, in 1943 the British stubbornly, and in the eyes of the Iranians, greedily, refused to renegotiate their contract to reflect the growing global trend to fairer and more equal contracts.  Venezuela signed a 50/50 deal with the foreign companies refining its oil; Aramco, an American oil company, signed a 50/50 deal with Kuwait and Saudi Arabia; and Mexico took advantage of the chaos of WWII and did the unthinkable and completely nationalized American and British oil companies.  The Iranians felt it was time that the British dealt justly and fairly with them as well.

    Not only did the British fail to fairly compensate the Iranians for their oil, they only paid them in sterling, effectively barring them from buying from other countries and forcing them to buy from the British.  They also secretly conducted geological explorations without the consent of the Iranian government, much less the Iranian people.  These explorations, plus the building of pipelines, often laid waist to forests, water sources, and other natural resources resulting in massive ecological disasters.  To add insult to injury, the British often imported labor from neighboring countries, rather then giving the Iranians the opportunity to work and make a living, much less take leading and managerial positions, in their nation’s most vital industry.   Squalid company housing, hospitals, and working conditions coupled with firings and military action against unions were also on the Iranians’ long list of grievances against the oil company.

    The Shah meets the CIA

    Beginning in the mid-40s tensions between Iranian workers and the Anglo-Iranian Oil Copany came to a critical impasse.  In July of 1945  7,500 AIOC workers led an unsuccessful strike demanding equal pay, decent housing, and paid Fridays.  They took to the streets again in May of 1946 with similarly disappointing  results.  It wasn’t until May of 1946 when 50,000 workers organized the greatest strike in Iranian history that the AIOC realized it had no way forward unless it made some concessions, though they probably came too little, too late to turn the tide of antiimperialism/colonialism felt by the vast majority of Iranians.

    Negotiations between the majles and the AIOC stalled and stagnated for the next 5 years.  With each passing year, the bitterness and resentment grew among the Iranian people who were tired of decades of what they felt was theft and national humiliation at the hands of British colonialists. The thirty-year old monarch, Mohammed Reza Shah Pahlavi did little to assist his countrymen in redressing the wrongs of the British.  In fact, at the height of the conflict between the majles and the AIOC, the young Shah abandoned Iran and set off on a American expedition where he mingled with the most wealthy and powerful of America’s elites.

    In November of 1949, at the invitation of Allen Dulles, the future head of CIA introduced Mohammed Reza Shah to the members of the newly formed Overseas Consultants Inc.  Mohammed Reza singlehandedly committed his country to paying the OCI an astonishing $650 million to complete a massive development project in Iran.  The deal was not well received at home since the majles had not approved of it or been consulted.  It did nothing more than stoke the flames of revolution that much more.  The final straw that broke the proverbial camel’s back came in March of 1951.

    Nationalizing Oil under Mohammed Mossadegh

    Having failed to reach a just and equitable agreement with the AIOC, the majles felt it had no other recourse than to take the course of action that the Mexicans had taken a decade before and nationalize their oil industry.  In March of 1951 the majles voted to take that fateful step and a few days later they elected the charismatic nationalist, Mohammed Mossadegh to the office of prime minister.  One of the first casualties  of the Mossadegh-led majles was the $650 million OCI deal, an act Allen Dulles would remember with bitter resentment.  Mossadegh believed with every ounce of his body that the Iranian oil fundamentally belonged to the Iranians.  Prior agreements with corrupt kings could not and should not be honored since they were made without the knowledge or consent of the people through their elected officials.

    Meanwhile the British took no notice of these legitimate claims and by June British warships menaced the Iranian coast and plans had been drawn involving seventy thousand troops invading Iran to seize what it claimed were British oil fields. The American ambassador, Henry Grady, warned the Truman administration that the British intransigence and belligerence was utter folly and could easily trigger World War III.  Truman, in no uncertain terms, informed Churchill that the United States would not agree to or support the overthrow of another democratically elected government.

    Even after nationalization, the Iranians sought to compensate the British by sharing 25 percent of  the net profits of the oil operation.  It also guaranteed that the British citizens who stayed and worked for the newly formed Iranian Oil Company would be welcome to stay.  It would also continue to sell the oil exactly as the British had done making sure not to disrupt the long established system of controls.  The British were not content with these compromises and stubbornly insisted on a return to the status quo where they, and they alone owned, managed, and controlled every aspect of the Iranian oil industry.  “We English have had hundreds of years of experience on how to treat the natives.  Socialism is all right back home, but out here you have to be the master” boasted one British minister.

    British Dirty Tricks, Eisenhower, and the Dulles Brothers

    Over the next year the British contemplated every trick they had learned in their long years of empire building: sabotage, assassination, bribery, and even a full on military invasion. But Truman’s opposition to regime change limited their options.  So in the meantime they settled  on imposing a crippling blockade of Iranian ports so that no country could buy oil from the Iranians.  Any tankers caught trying to slip through would be detained. 

    The British also took their case to the International Court of Justice in the hopes of getting the international community to bolster its position only to be told that the ICJ had no jurisdiction in the case since it involved agreements between Iran and a private company.  They took their case once again to the UN in New York in the fall of 1952 but met a brick wall there as well.  Mohammed Mussadegh was present and he spoke forcefully and eloquently about the plight of the Iranians and about the history of the AIOC’s predations. His speech was well received especially by those leaders who themselves had been brought to power on the waves of nationalism in Asia, Africa, and South America.

    Having exhausted all resources, the British resolved to covertly overthrow Mohammed Mossadegh, even though 95-98 percent of the population of Iran time and time again favored him as their one true leader in elections and referendums.  They could not count on the Truman administration for support, so they bided their time until after the 1952 elections which could bring someone that was more to their way of thinking or could be brought around to it.  They found such a men in Dwight Eisenhower, in his Secretary of State, Foster Dulles, and in Allen Dulles, head of the CIA. 

    A Deep State Purge 

    The British argument for overthrow rested on the necessity to regain the control of the oil industry away from the Iranians.  However, that argument alone would not be enough to win over Eisenhower and Dulles.  All three men were ardent anti-communist and the British used that to their advantage painting Mossadegh as a communist at worst and at best, a weak leader who’s government could easily fall which could lead to a Soviet takeover of Iran.  These were all the reasons and proofs Eisenhower and Dulles needed.  Without consulting experts or career diplomats on Iranian affairs they forged ahead with their plan to help the British topple Mossadegh. 

    They even went so far as to dismiss any who disagreed with them.  One such unfortunate was none other than the chief of the CIA field office in Tehran, Roger Goiran.  If any body knew what the realities on the ground were, it was he.  Having learned of the plot he was repulsed by the idea, and thought that regime overthrow in the cause of a preemptive strike of sorts in order to prevent the Soviets from theoretically moving in was too dramatic a move.  His objection was noted after which he was quickly relieved of his duties and replaced by Kermit Roosevelt, one of the conspirators.

    Ultimately, seasoned intelligence veteran Goiran disagreed with and was subsequently purged by the ‘deep state‘ as Stephen Kinzer’s book All the Shah’s Men (John Wiley and Sons, Inc., Hoboken, New Jersey, 2003, pg. 164) explains:

    Goiran had built a formidable intelligence network, known by the code name Bedamn, that was engaged in propaganda activities aimed at blackening the image of the Soviet Union in Iran. It also stood ready to launch a nationwide campaign of subversion and sabotage in case of a communist coup. The Bedamn network consisted of more than one hundred agents and had an annual budget of $1 million–quite considerable, in light of the fact that the CIA’s total worldwide budget for covert operations was just $82 million. Now Goiran was being asked to use his network in a coup against Mossadegh. He believed that this would be a great mistake and warned that if the coup was carried out, Iranians would forever view the United States as a supporter of what he called “Anglo-French colonialism.” His opposition was so resolute that Allen Dulles had to remove him from his post.

    This was new and unchartered territory for the United States in Iran or anywhere.  Up to then, most Iranians had a positive view of America and look up to Americans because of their own revolutionary history, constitution, form of government, and insistence on the rule of law.

    Operation Ajax Launched with False Flag subversion 

    The Iranians viewed the Americans as allies and friends.  By undertaking regime change, the Americans risked losing the goodwill of the Iranians and earning their much deserved scorn.  Nevertheless, Kermit Roosevelt took the reins of the operation and plotted his coup for several months.  Once he was given the green light by the Dulles brothers and President Eisenhower, Roosevelt set his plan in motion.  In late July of 1953 he crossed over into Iran under an assumed name and headed directly to Tehran to meet up with the valuable Iranian, British, and American assets.  They immediately set out to subvert the Mossadegh government by paying off street gangs, corrupt mullas, and radio stations to create entirely fabricated anti-Mossadegh protests.  They also bribed members of the majles to support a vote of no confidence.  Mossadegh caught on to the plot and immediately dissolved the assembly, denying the conspirators any chance at a quasi-legal way of deposing him.

     

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    Persian soldiers chase rioters during CIA-orchestrated civil unrest in Tehran, August 1953. Archive photo via Foreign Policy magazine.

    Once plan A crumbled, Roosevelt put plan B into action which called for the Shah himself to sign royal decrees dismissing Mossadegh from office and appointing General Fazlollah Zahedi as his new prime minister.  The Shah demurred, going so far as running away to the Caspian Sea.  In the end Roosevelt caught up with him and convinced him him to sign. 

    On the night of August 14, 1953 Roosevelt sent Colonel Nassiri and a contingency of soldiers to Mossadegh’s house.  Their task was to present the royal decrees to Mossadegh and take him into custody.  To their surprise, Mossadegh had been tipped off about the plot and had in the shadows a contingency of officers of his own ready to take Col. Nassiri and his men into custody.  The following morning, Radio Tehran announced that the government had successfully foiled the plot by the Shah and foreign elements to overthrow the government.

    Having heard the news, Roosevelt’s CIA superiors urged him to give up the plot and return home.  However, not being one to back down, Roosevelt forged ahead.  For the next 4 days, through his Iranians assests Roosevelt hired more street gangs to simultaneously put on pro and anti Mossedegh demonstrations.  The demonstrations had the desired effect of plunging Tehran into an abyss of violence and lawlessness. 

    Coup d’etat

    On August 19th the violence reached its climax paving the way for the final part of Roosevelt’s plan: a full on military coup. At noon the military and police officers Roosevelt had bribed, stormed and took control of the foreign ministry, the central police station, the headquarters of the army’s general staff, and laid siege to Mossadegh’s house.  Mossadegh narrowly managed to escape, but turned himself in the following day to General Fazlollah Zahedi, not wanting to be the cause of further blood shed. Zahedi played a large role in the coup in cooperation with the CIA and Britain’s MI6, and would go on to replace Mossadegh as prime minister. 

    The fall of Mossadegh, on August 20th, 1953 also marked the end of Iran’s long and painful march to true and complete democracy and national sovereignty.  It also marked the beginning of a 26 year reign of corruption and oppression in which Mohammed Reza Shah, quickly returned to power by the 1953 coup d’état, brutally stamped out the pro-democratic reforms of the majles, violently put down any opposition, as well as what arguably angered the Iranians the most: the Shah returned the oil industry back to Western corporations, once again depriving the citizenry of the wealth that rightly belonged to them. 

    Iranians, unlike many average Americans who are not taught this history in school, have always known that America was involved in the overthrow of their democratically elected government and have thus hated the US government ever since.  This hatred was seen most vividly in 1979 Islamic Revolution when 52 embassy staff in Tehran were held hostage for 444 days. 

    It was only in 2013 that the CIA formally acknowledged its role in bringing down the Mossadegh government after the agency was forced to declassify and publish secret documents related to Operation Ajax, (and first disclosed by The New York Times’ James Risen) and to this day most Americans are unaware that it happened. Yet it is essential to understanding the historical domino effect that American and British interventionism played in bringing the US and Iran to their modern period marked by decades of animosity and enduring mutual distrust. 

  • As No One Watched, Trump Pardoned 5 Megabanks For Corruption Charges

    Authored by Richard Blevins via The Free Thought Project,

    While Americans celebrated the holidays, President Trump followed in the footsteps of his predecessors by acting in the interest of Wall Street and using the distraction to do something that was not in the best interest of the American people. He pardoned five megabanks for rampant fraud and corruption, which is especially notable because of the amount of money he owes them.

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    Trump has been using Deutsche Bank since the 1990s, and Financial Times has reported that he now owes the bank at least $130 million in outstanding loans secured in properties in Miami, Chicago, and Washington. However, the report claimed that the actual number is likely much larger at $300 million.

    Reports claimed that Deutsche was the only bank willing to lend Trump money after his companies faced multiple bankruptcies. The relationship has continued over the years, and an analysis from the Wall Street Journal claimed that Trump has received at least $2.5 billion in loans from Deutsche Bank over the last 20 years.

    There have been concerns about Trump’s ties to the bank becoming a conflict of interest, dating back to the 2016 election, and the evidence to support those concerns is now becoming clear.

    During the week of Christmas, the Federal Register announced that the Trump Administration had issued waivers to Citigroup, JPMorgan, Barclays, UBS, and Deutsche Bank – all megabanks facing charges of fraud and corruption.

    The banks were involved in the LIBOR Scandal, in which they colluded to deliberately depress the rate at which they paid out on investments. By suppressing the London Interbank Offered Rate (LIBOR) at the beginning of an economic crisis in 2007, the megabanks were able to boost their earnings and to give their customers a false sense of security.

    Deutsche Bank pled guilty to wire fraud in a U.S. court in 2015, and it went on to pay $3.5 billion for its role in the LIBOR scandal—more than any other bank involved—before it reached a $7.2 billion settlement with the Justice Department in early 2017.

    Then in June 2017, Deutsche Bank trader David Liew, who is based in Singapore, pleaded guilty to conspiring to spoof gold, silver, platinum and palladium futures in federal court in Chicago, confirming that the biggest banks in the world have conspired to rig precious metals markets.

    While Trump granted 5-year exemptions to Citigroup, JPMorgan, and Barclays, and 3-year exemptions to UBS and Deutsche Bank, it should be noted that his administration is not the only one to have done this. As International Business Times noted, “In late 2016, the Obama administration extended temporary one-year waivers to five banks,” which just happened to be the same ones Trump has now extended the exemptions on—revealing the real rulers in DC.

    Not surprisingly, the latest decision to pardon the banks comes in stark contrast to one of Trump’s most applauded campaign promises – that he would finally stand up against Wall Street and demand that the most powerful banks be held accountable to the public.

    “I’m not going to let Wall Street get away with murder. Wall Street has caused tremendous problems for us. We’re going to tax Wall Street,” Trump said during a campaign rally in January 2016.

  • Cryptos Slide After Yet Another South Korean Shutdown Headline

    Cryptocurrencies are sliding once again as Asia opens following headlines from South Korea’s finance ministry that a cryptocurrency exchange shutdown is still an option (but admittedly it needs “serious” discussion among ministries first).

    While all of the main South Korean ministries agree that there is irrational speculation in cryptocurrency and rational regulation are needed to curb the speculation, only the Justice Ministry has said the shut down of cryptocurrency exchanges is needed as other ministries are concerned about side effects.

    As Yonhap reports again, The Office for Government Policy Coordination made the announcement, downplaying the justice minister’s remark last week that the government is working on legislation to close all virtual currency exchanges to tackle speculation.

    “The proposed shutdown of exchanges that the justice minister recently mentioned is one of the measures suggested by the justice ministry to curb speculation. A government-wide decision will be made in the future after sufficient consultation and coordination of opinions,” the office said in a statement.

    Ripple is leading the overnight slam (down around 10%)…

    https://www.zerohedge.com/sites/default/files/inline-images/20180115_crypto1.png

    Which leaves Ripple down 25% year-to-date (while Ethereum remains up around 65%)…

    https://www.zerohedge.com/sites/default/files/inline-images/20180115_crypto_0.png

    Bitcoin just broke back below $13,000 having tested above $14,000 during the day…

     

    https://www.zerohedge.com/sites/default/files/inline-images/20180115_crypto2.png

    The irony is that all of this ‘news’ hit last night (and has done numerous times) but keeps getting regurgitated as new headlines that take the cryptos down briefly.

  • As Petro-Yuan Looms, Bundesbank Adds Renminbi To Currency Reserves

    Just days after China’s (denied) threat to slow/stop buying US Treasuries, and just days before the launch of China’s petro-yuan futures contract, Germany’s central bank confirmed it would include China’s Renminbi in its reserves.

    The FT reports that Andreas Dombret, a member of Deutsche Bundesbank’s executive board, said at the Asian Financial Forum in Hong Kong on Monday that the central bank had “decided to include the RMB in our currency reserves”.

    He said: “The RMB is used increasingly as part of central banks’ foreign exchange reserves; for example, the European Central Bank included the RMB [as a reserve currency].

    The Bundesbank’s six-member board took the decision to invest in renminbi assets in mid-2017, but it was not publicly announced at the time. No investments have been made yet; preparations for purchases are still ongoing.

    The inclusion in the German central bank’s reserves basket underscored China’s increasing prominence in the global financial landscape, and reflected policies aimed at making the currency more freely tradable internationally.

    Mr Dombret said:

    “The notable development from the European point of view over the past few years has been the growing international role of the RMB in global financial markets.

    The offshore Yuan strengthened on the news overnight – pushing to its strongest in over 2 years…

    https://www.zerohedge.com/sites/default/files/inline-images/20180115_dollar1_0.png

    And as Les Echoes reports, while the Bundesbank wants to integrate the yuan into its foreign exchange reserves, the Banque de France is already using it as a currency of diversification.

    The Banque de France has raised a corner of the veil on its strategy of managing foreign exchange reserves.

    “The foreign currency holdings remain overwhelmingly invested in US dollars, with diversification to a limited number of international currencies such as the Chinese renminbi.

    Which currency would you rather hold as a stable reserve?

    https://www.zerohedge.com/sites/default/files/inline-images/20180115_dollar.png

    The US Dollar has been quite volatile over the last 18 months against a broad basket of its largest trading partners.

    The Chinese Renminbi, however, has been very stable over the last 18 months against a broad basket of its largest trading partners (despite volatility against the dollar).

    As a reminder, last week, the People’s Bank of China decided to drop a mechanism it recently created to support the renminbi and safeguard it against capital flight, in a sign of rising confidence in the currency. Mr Dombret said the move was “something which we welcome very much”.

     

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Today’s News 15th January 2018

  • Is There Such A Thing As A "Shithole Country"?

    Authored by Andrew Korybko via Oriental Review,

    The question should be rephrased to whether there’s such a thing as a “shithole” period, and yes, there is, but the stereotypical “Third World” socio-economic and physical conditions that the word often embodies are also widely present in parts of the US.

    Another day, another Trump controversy, and this time it’s the Mainstream  Media going bonkers because of the President supposedly referring to some countries as “shitholes” and questioning why the government has allowed so many of their people to immigrate to America. Knowing Trump’s personality and speaking style, it’s believable that he did in fact say this, though what’s less believable is the insincere virtue signaling that’s sprung up all over social media ever since.

    Defining A “Shithole”

    Some people are predictably slamming Trump as a “racist”, “fascist”, and “white supremacist”, outraged that he would dare use such language when referring to the “Third World” conditions of Haiti and most of Africa and convinced that he was actually exploiting that as an excuse in order to have the “plausibly deniable pretext” for implying that their majority dark-colored populations are “shit”. He wasn’t, but that’s not going to stop agenda-driven individuals and organizations from pretending that that’s what he meant.

    What Trump really had in mind was the stereotypically (key word) underdeveloped economic and physical infrastructure in those places, as well as the unstated “backwardness” of their people that he thinks contributes to never-ending violence there. Using the first pair of criteria, the same “shithole” label is also very relevant in objectively describing parts of the US and the broader West as a whole, especially neglected inner-city areas with large minority populations.

    The problem is that the idea of “backwardness” is relative, and for as much as Trump and some Americans might think that African-Americans, Haitians, and Africans fit that description, they and others might feel just as strongly that the US in general is a “backwards” place as well, though for totally different reasons. “Shitholes”, whether inside the US or elsewhere, are devastated communities whose problems aren’t easily attributable to one source and are commonly the result of many factors, some of which aren’t the fault of those who were born there into those deplorable conditions.

    “Backwardness” Is In The Eye Of The Labeler

    “Backwardness”, however, is an entirely subjective comparison made at the individual level and used to generalize other people as well as societies, regions, countries, continents, and even civilizations. Just as some Americans might feel that a different category of their compatriots are “backwards”, so too might non-Americans feel the same about Americans, and whether or not this is “racist” is up to each person to determine on their own. Take for example the US’ well-known racial tensions – some “whites” might think that the “gangsta rap” prevalent in “black” culture is a “backwards” display of social “values”; likewise, some “blacks” might think that flying the Confederate flag is “backwards” behavior stemming from the Civil War period when slavery was still legal.

    There are of course uncontestably racist examples that can be mentioned in this vein, but such hatred deserves no place in a respectable analysis and therefore shouldn’t be the subject of any discussion.

    As for the larger conception of “backwardness”, some Americans firmly believe that Islam is the epitome of this idea, but some of these very same Muslims think that it’s Americans themselves who live a “backwards” lifestyle due to many examples of their cultural behavior being contradictory to the Prophet Muhammad’s teachings. Americans might retort that the “tribal conditions” of Libya, “Syraq”, Yemen, and Afghanistan play a major role in perpetuating violence there (forgetting their own country’s role in this), but these people could just as easily point to the US’ “identity politics” being responsible for why no one has yet to stop the mostly black-on-black gangland killings in Chicago or other big American cities.

    Ghetto graffiti

    Moving From “Shithole” To “Shithole”

    Accepting that the objective (economic and physical infrastructure) and subjective (“backwardness”) conditions of a “shithole” can be found anywhere in the world, including in the American heartland itself and especially its inner cities & the “Rust Belt”, it’s time to ponder why people move from “shithole” to “shithole”. This phenomenon is interestingly observable not just in relation to people from foreign “shitholes” immigrating to the US, but also in terms of Americans leaving for other “shitholes” inside their own country.

    Foreign “Shitholes”:

    Haitians and Africans, to use the examples that Trump was originally referring to, depart from their “shitholes” for America because they expect that their intended destination has higher living standards in the economic, physical, and/or social senses. It’s true that the average (keyword) all-around conditions in the US are oftentimes better than in most other places due to its more effectively functioning civil society, which includes its courts and police, though serious abuses still occur in these spheres. Most attractive of all and capable of getting many immigrants to overlook these very real problems is the country’s currency, the dollar.

    The possibility of a “petroyuan” poses a latent threat to the dollar’s worldwide dominance, but for now at least the dollar is still king, and that’s why people from “shitholes” all across the world want to work in America. To put it bluntly, they’d rather be paid in dollars than whatever their national currency may be, and that explains why these migrants oftentimes support their families back home through remittances prior to abusing the immigration system to bring them to the US through legalized “chain migration” schemes. It doesn’t matter if their physical and working conditions are worse in America than back home in some cases, what’s seemingly most important to them is that they’re paid in dollars.

    American “Shitholes”:

    The same cynicism is what drives some Americans to move from one “shithole” to the next in search of what they naively believe could be a “better life” that would allow them to finally live the “American Dream”. People from the “Rust Belt” can’t easily move to the California coast without already having a job lined up because it’s too prohibitively expensive for them to do so, which is why they sometimes spend all of their meager savings and even borrow money from their families to make what they hope would be a life-changing trip for the “better”. Unfortunately, due to their limited means, they oftentimes find themselves trading one “shithole” for another because of their economic inability to climb out of the social gutter that they usually have to inhabit in order to barely make ends meet there.

    “Chain migration” is the exception once again because having a family member or close friend in the destination state could help the internal migrant cut down on costs by splitting living expenses with their hosts, thus helping the whole household. Each person could then more quickly save up money and begin planning for their next step in life as they attempt to “climb the ladder of success”, provided of course that they’re willing to sacrifice on their social conditions for the time being in order to make it possible. This could entail living in very cramped conditions inside what are popularly described as “ghettos” (colloquially known as “the hood” in the US), which are usually characterized by the proliferation of drugs, violence, and naturally, the seemingly never-ending consequent cycle of poverty.

    Dollar Delirium:

    The common thread explaining why many people (whether foreigners or Americans) move around from “shithole” to “shithole” within the US is because they’re infected with “dollar delirium”, or the fallacy that a higher gross income automatically translates to a “better life”. For people coming from the “shitholes” of inner-city Cleveland or the rural villages of the Congo, simply earning more money is assumed to be the secret to “succeeding” in life, overlooking the fact that their desired destination also has higher living expenses that may in some cases leave them with a proportionately lower disposable income than if they just stayed home. This might not bother them so long as their basic needs are taken care of and they still have some money left over to spend on entertainment or save for later, but others might come to regret it if their social expectations aren’t adequately met.

    The Social Solution To All “Shitholes”

    Silk Roads:

    Not everybody moves because they want to “get rich” or make a “quick buck”, since buying the newest iPhone isn’t as important to some people as having a stable and respectable livelihood for themselves and their families. “Shitholes” don’t typically provide this, or at least not in a way that satisfies most people, which is why they decide to move elsewhere in search of a “better life”. It would be wrong to imagine that immigrants, whether foreigners to the US or Americans within it, are all “greedy”, and the “safest assumption” is that they’re motivated by social push-and-pull factors more so than economic ones.

    That said, an obvious solution to migration presents itself in the form of encouraging socio-economic development in migrant-originating areas, which is exactly what China’s One Belt One Road (OBOR) global vision of New Silk Road connectivity and Trump’s infrastructure plan– both of which are conceptually compatible with one another – aspire to do. A comprehensive strategy involving local, state/provincial, and national governments alongside state-owned and private businesses is the only conceivable way forward, but it’ll still take a while to yield results even if the most masterful plan was flawlessly executed, which is in any case unlikely.

    Belief System Compromises:

    Because this solution will take a long time to implement, if ever, the next best thing is to discuss the details of the infrastructural and metastructural social reasons behind migration. Social infrastructure can be described as schools, healthcare, and welfare benefits, for example, while social metastructure is culture and its related intangibles. Most socially motivated migrants are willing to compromise on social metastructure in order to reap the benefits of its infrastructural counterpart, meaning that they’ll “grin and bear it” if they dislike their new cultural conditions so long as they receive their expected access to certain “hard benefits” such as what they believe to be a better education system and state subsidies.

    Considering this, it makes sense why people who hate America’s cultural-political system still migrate there because they’re tacitly compromising on their (sometimes publicly proclaimed) beliefs in exchange for receiving expected economic and social infrastructure “rewards”, and the same goes for Americans migrating to other states or countries. To reference the example mentioned earlier in this analysis, some Muslims think that American culture is “backwards”, but they’re willing to deal with it if the pay and social infrastructural conditions are right.

    As for Americans, an “enlightened” liberal might escape from California’s dysfunctional society to seek refuge in the rural “backwaters” of a “red state’s” much more stable one despite their new destination restricting abortion and therefore being “ideologically incompatible” with one of their core beliefs. Another domestic example could be a conservative from “Middle America” moving to the liberal dystopia of New York City in the hopes of finding a better job. As for external manifestations of this “social compromise” in action, elderly Americans who look down upon what they may believe to be the “backwards” people of Latin America might “suck it up” and retire in that region simply because it’s more affordable.

    Sacrificing For The Next Generation:

    The last “solution” to the world’s “shitholes” is the passive one that’s been employed since time immemorial, and that’s migrants sacrificing their living standards by knowingly accepting that they’ll likely spend the rest of their lives in suboptimal social conditions in order to give their descendants that are born there a “better chance” at “climbing the ladder’ and “succeeding” in ways that their parents weren’t ever able to. This is the quintessential story of most American immigrants throughout history and especially from the late-19th century until the present day, and it also describes why many civilizationally dissimilar migrants are willing to put up with Europe’s different social metastructural standards in spite of this contradicting the strict requirements of their religion.

    Another relevancy of this principle is when Americans migrate from their rural “shitholes” to urban ones, or from one “hood” to another in different cities, hoping that their children can seize the socio-economic opportunities there that their parents either weren’t able to or which didn’t exist in their hometowns.

    Sacrificing for the next generation doesn’t “solve” the problem of “shitholes” – it ignores them – though sometimes there are “activists” who try to change things for the better in their own “shitholes” or the ones that they just moved into, but their freedom of action is severely constrained by the laws of their host society. Muslim migrants wanting to impose sharia in their new European neighborhoods or build mosques there are increasingly finding it more difficult to do so, but they still have it comparatively better than a Syrian Christian refugee that somehow ends up in a Gulf Kingdom and wants to hold public church services or build their own house of worship there.

    In America, social and workplace activism is the most common form of struggle for people who have been born and raised in “shitholes” or internally migrated to them, and while they have a greater chance of succeeding with their cause inside the US than “shithole”-inhabiting people elsewhere in the world, it’s becoming increasingly more difficult by the year for them to do so.

    A homeless in New York City

    The Myth Of “Equality”

    Theoretically and in terms of “international law”, all countries and cultures are “equal” to one another as seen from the eyes of the UN and its related UNESCO body, though in reality many people have their own personal preferences and accordingly believe that some countries and cultures are “better” than others. Someone indoctrinated with “American Exceptionalism” might truly think that the US is the “best” place on earth by all measures, while some Muslims might think that their own societies are the “best” to live in for cultural-religious reasons. Each of these two might have nothing but disdain for the other, but that’s their personal right, in fact, whether one agrees with it or not. It’s up to each individual to judge on their own whether this or any of its manifestations constitute “racism”, though it must be noted that there are indeed some undeniable examples of racism that should always be condemned.

    That said, screaming “racism”, “fascism”, and “supremacism” just because someone has an individual opinion – no matter how disrespectful and offensive, though given that it doesn’t objectively conform to any of those three aforementioned terrible terms – is hypocritical because one can be certain that the person casting the stones also has their own “hierarchical” views on something or another, even if they’re more “politely” expressed. The Haitians and Africans that Trump so derogatorily described as coming from “shitholes” might think that some parts of their home region are “better” than others, just as they apparently think the US is the “best” because they’ll willing to leave their homelands to migrate there. The same can be said for Americans who favor one place of living within their own country over another, for whatever given reason, whether it’s the “shithole” that they moved to or their new place of living after escaping from a “shithole”.

    Mixed Motivations For Migration

    It’s crucial to understand that those who migrate from one “shithole” to another don’t always believe that everything in their place of residence is the “best”, but might be willing to “compromise” on certain aspects of it either due to “dollar delirium” or because they intend to sacrifice for the next generation. For example, it’s entirely natural for immigrants to retain their native culture and values inside their homes while trying to publicly assimilate and integrate into their host societies at large, such as some Arabs do when migrating to the West or some Westerners do when moving outside of their civilizational sphere (or even within it, with Poles being a perfect example). The complexity of the millennia-long phenomenon of migration means that there’s no simple explanation for why people decide to move away from their place of birth, with each instance being unique and usually motivated by multiple factors.

    Concluding Thoughts

    At the end of the day, using the word “shithole” to describe somewhere is a crass way of making objective points about economic & physical infrastructure and socially subjective ones about “backwardness”, but nevertheless is the right of every individual to use according to their taste so long as they’re not promoting actual racism or any of its related toxic ideologies such as fascism or supremacism. It’s not just Trump and “whites” in America who use this term, but other people across the world employ it or whatever the local analogue is in their language when making similar types of comparisons, and even in the absence of actual words, internal value judgements about other countries and cultures are still being formulated. It’s natural for people to have their own personal hierarchy of national-cultural preferences no matter how “politically incorrect” it may be to openly admit in some societies, meaning that the concept of the “shithole” is here to stay whether one likes it or not.

  • These Are The 10 Companies That Dominate the Global Arms Trade

    The world puts $1.69 trillion towards military expenditures per year, and about $375 billion of that goes towards buying arms specifically.

    Whether it is guns, tanks, jets, missiles, or ships that are on your shopping list, in the international arms community, as Visual Capitalist’s Jeff Desjardin notes, there is a supplier for any weapon your country desires.

    Courtesy of: Visual Capitalist

     

    ARMS DEALERS, BY SALES

    Today’s chart organizes the world’s top arms companies by sales, location, and arms as a percentage of sales:

    https://www.zerohedge.com/sites/default/files/inline-images/20180114_arms.png

    Note: Airbus considers itself a European company. It’s registered in the Netherlands, and its main HQ is in France.

    The above data comes courtesy of the Stockholm International Peace Research Institute (SIPRI), which tracks arms deals and companies extensively.

    USA, USA!

    While it is common knowledge that the United States plays a big role in the global arms trade, the numbers are still quite astounding.

    Of the top ten companies by sales, firms based in the U.S. make up seven of them. That includes the clear #1, Lockheed Martin, which had $40.8 billion in arms-related sales in 2016, as well as the remaining constituents of the top three: Boeing and Raytheon.

    Further, on SIPRI’s wider top 100 list, a good proxy for total arms sales globally, U.S. defense companies accounted for a whopping 58% of total global arms sales. That adds up to $217.2 billion in 2016, a 4.0% rise over the previous year.

    ROUNDING OUT THE TOP 10

    Only three companies make the top 10 leaderboard from outside of the United States.

    That group includes Airbus, the massive European commercial airline manufacturer that gets 17% of its sales from arms-related deals, as well as BAE Systems (U.K.) and Leonardo (Italy).

    As a final caveat, it’s worth mentioning that SIPRI notes that some Chinese companies would likely make its Top 100 list as well – but for now, the list excludes Chinese companies as the available data is not comparable or accurate.

  • Customs And Border Protection Clarifies: You Have No Rights While Traveling

    Submitted by Sovereign Man

    The government is like a poorly trained dog. If you let one bad behavior go, it just escalates until they bite.

    The government has been searching electronics like cell phones and laptops at the border since early in the Bush administration. But because the 9/11 attacks were fresh, and because the practice was not widespread, it went largely unnoticed.

    Fast forward to fiscal year 2015 and the Customs and Border Protection searched 8,503 airline passengers’ electronic devices. In FY 2016 they searched 19,033. And in FY 2017 CBP searched the devices of 30,200 travelers.

    The CBP obtained no warrants for these searches. Many people searched were foreign travelers to the U.S. but last year over 6,000 were American citizens.

    In response to growing complaints Customs and Border Protection revised their policy. Last week they issued a new directive. But in some ways, it is worse.

    For starters, their guidance claims the authority to search a traveler’s electronic devices “with or without suspicion.”

    The guidance now claims passengers are “obligated” to turn over their devices as well as passcodes for examination. If they fail to do so, agents can seize the device.

    That is all considered a “basic search.” Agents must have suspicion in order to conduct an “advanced search.” This includes copying information from devices, or analyzing them with other equipment.

    Finally, CBP agents can not “intentionally” search information stored on the cloud, versus on the device’s hard drive.

    What this means:

    It actually adds insult to injury that the new guidance starts: “CBP will protect the rights of individuals against unreasonable search and seizure and ensure privacy protection while accomplishing its enforcement mission.”

    Nothing could be further from the truth. This is clearly a violation of the Fourth Amendment protections against unreasonable search and seizure. This violates the privacy of everyone searched.

    Then they demand you forgo your Fifth Amendment rights against self incrimination. If you refuse to give out your password, they further violate the Fourth Amendment by seizing your device.

    CBP agents are human. There is no inherent reason that they can be trusted with information like passwords. There is no reason why passengers should have to trust that their copied information will actually be destroyed according to CBP policy.

    There is no legal justification to threaten the contacts and sensitive information that journalists might be transporting. This further adds First Amendment concerns to this intrusive policy. It could easily be used to chill free speech and freedom of the press.

    Luckily there is a lawsuit in the works challenging this policy, but a ruling cannot happen quick enough.

    In the meantime, prepare carefully for international travel. You may even want to travel only with “burner” devices; meaning you don’t mind if they are confiscated for refusing an unconstitutional search.

  • Who Do Russians Consider Their Greatest Enemies?

    According to a new poll from The Levada Center, 23 percent of Russians believe their country is surrounded by enemies.

    While, the list of who Americans consider their enemies has been covered by Statista before, Niall McCarthy wonders what do Russians think?

    Infographic: Who Russians Consider Their Greatest Enemies  | Statista

    You will find more statistics at Statista

    The research shows that 68 percent of people in Russia consider the United States a threat.

    Considering the annexation of the Crimea and the war in Eastern Ukraine, 29 percent of respondents also said that Ukraine is an enemy.

    Even though the Russian military is heavily committed to the war in Syria, only 5 and 4 percent of people respectively say Islamic extremists are a threat. That’s less than Germany, the UK and NATO which are all labelled enemies by 6 percent of Russians.

    Internally, only two percent of respondents consider oligarchs and bankers enemies and one percent think Vladimir Putin is a threat.

  • Japanese Purchases Of US Treasurys Tumble

    In the last days of 2017, we showed something surprising: as a result of suddenly exploding USDJPY funding costs, there had never been a worse time for Japanese investors, traditionally some of the most ravenous purchasers of US paper, to buy US Treasurys.

    As we explained on December 27, USD funding costs for Japanese insurers and banks to invest in US Treasuries – which had surged reaching a post-financial-crisis high of 2.35% on 15 Dec – are determined by three things, namely (1) the difference in US and Japanese risk-free rates (OIS), (2) the difference in US and Japanese interbank risk premiums (Libor-OIS), and (3) basis swaps, which illustrate the imbalance in currency-hedged US and Japanese investments.

    In this particular case, widening of (1) as a result of Fed rate hikes and tightening of dollar funding conditions inside the US (2) and outside the US (3) have occurred simultaneously. This is shown in the chart below.

    Whatever the cause behind these sharp funding shortages, one thing was clear – dollar funding costs (FX hedging costs) for both Japanese insurers, banks and other investors to buy US Treasuries were surging (with Japanese buyers and reached a post-financial-crisis high of 2.35% on 15 Dec. And in terms of practical implications for the treasury market this means that, all else equal, marginal demand for US paper is about to plunge for one simple reason: the FX-hedged yields on US Treasurys have plunged to (negative) levels never seen before (unless of course foreign investors buy US Treasurys unhedged).

    To demonstrate this point, the chart below from Deutsche Bank shows the yields on currency-hedged US Treasuries from the perspective of Japanese investors. Annualized hedge costs had risen to 2.33% at the end of December, which means that investments in 10y US Treasuries would result in virtually no yield. Furthermore, yields from investment in shorter than 10y US Treasuries would be less than JGBs and result in negative spreads.

    And while TSY funding costs, and various X-CCY basis swaps in the past two weeks has dropped, Japan’s lack of appetite for US Treasurys will only continue to rise.

    The reason is that as the Nikkei reports, Japanese investors – traditionally the most enthusiastic foreign buyers of US Treasurys – have become far less enthusiastic about buying US debt last year on growing concern about rising U.S. Treasury yields. According to Ministry of Finance data released on Friday, Japanese investors’ net purchases of mid- to long-term foreign bonds tumbled 94.6% on the year to 1.1 trillion yen ($9.9 billion) in 2017, the first annual decline in four years.

     

    sdf

    In prior years, Japanese institutional investors such as banks and life insurance companies had actively pursued foreign bonds in search of higher returns, finding few alternatives in Japan, where interest rates remained extremely low, and Europe providing few options as a result of the ECB’s NIRP policies. As a result, the only option for many was US paper.

    But the November 2016 election of Donald Trump as U.S. president sent the 10-year Treasury yield shooting up from around 1.8% to almost 2.6% in just over a month, and the yield stayed above 2% throughout 2017. Any investors holding onto Treasurys during the yield surge would have incurred significant losses as prices tumbled.

    Life insurers’ net purchases declined 8.4 trillion yen last year, and banks collectively turned into net sellers, with their net sales reaching a record 7.6 trillion yen. Over 2015 and 2016, in contrast, they bought 20.6 trillion yen more than they sold.

    In March 2017, Japan’s Financial Services Agency announced stricter oversight on foreign bond investment by regional banks. The following month, net sales of mid- to long-term bonds by Japanese investors hit a monthly record of 4.2 trillion yen.

    And, of course, as discussed at the top, the higher cost of buying the U.S. dollar is also at play. Life insurers often hedge against a strengthening yen via foreign exchange swaps when investing in foreign bonds. But hedges have become more expensive due to higher U.S. interest rates and other reasons. So the appeal of investing in U.S. bonds has faded overall, unless of course, Japanese investors bid up US paper unhedge, which however could backfire dangerously should FX volatility pick up, or if the dollar continues to devalue against most G-10 peers.

    The bottom line: foreign, and certainly Japanese demand for US Treasurys appears to be sliding, whether due to rising yields and P&L losses, or blowing out funding costs, at the worst possible time: just as net supply of US Treasurys is set to double from $488BN in 2017…

    … to $1,030BN in 2018, as Goldman calculated last Friday.

    Which means that just one hiccup, and yields will soar. It also means that we are one not so major bond tantrum away from the Fed begging preparations for the next massive bond monetization episode, also known as QE4.

  • "I Paid To See A Movie About Singing. I Got Ninety Minutes Of Pentagon Propaganda."

    Authored by Caitlin Johnstone via Medium.com,

    To cap off a long, strange day, my husband and I took the kids out last night to see Pitch Perfect 3. The first Pitch Perfect is a firm favorite in our household, the kind of movie we end up watching when we can’t agree on what to watch. We’d been waiting til we all had a night to see the latest one together, so we made a night of it and went out for some dinner, too. I even had a Coke. The sugary kind. This was a big night, people! So we were all in high spirits and I entered the theater excited to see some good music and have a good time.

    I wasn’t expecting a masterpiece, but I also wasn’t expecting to be blasted in the face with ninety minutes of blatant war propaganda from the United States Department of Defense.

    Documents Expose How Hollywood Promotes War On Behalf Of The Pentagon, CIA, & NSA “The documents reveal for the first time the vast scale of US government control in Hollywood, including the ability to…”

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    Before I go on I should mention that a group called Insurge Intelligence published a report a few months back on thousands of military and intelligence documents obtained under the Freedom of Information Act which showed unbelievably extensive involvement of US defense and intelligence agencies in the production of popular Hollywood movies and TV shows. Just from the information this group was able to gain access to, the scripts and development of over 800 films and 1,000 television titles were found to have been influenced by the Pentagon, the CIA, and the NSA to advance the interests of the US war machine. We’re talking about big, high profile titles you’ve definitely heard of, from Transformers to Meet the Parents.

    So it’s an established fact that these depraved agencies of destruction and domination are balls-deep in Hollywood production. You can understand my discomfort, then, as it became evident that the movie I’d sat down to watch with my family was set on US military bases for no reason whatsoever. There was nothing about the plot of Pitch Perfect 3 that required this; any music tour of any kind would have worked just as well. The antagonist had nothing to do with the military, the protagonists were a civilian a capella singing group, and the general conflicts and resolutions of the film were entirely uninvolved with anything related to the armed forces of any nation.

    Indeed, the film looks like it was initially written to have taken place in a civilian setting, then after many rewrites and the involvement of God knows what agencies managed to force itself onto US military bases. As Insurge Intelligence noted in its report, once that happens the war machine is granted what amounts to total creative control of the film’s production, up to and including the ability to cancel production altogether by withdrawing support.

    Sure enough, retired Army lieutenant colonel Thomas Lesnieski, who was involved with the production of the film, says that in order to “make sure that the way the military is portrayed is done right,” changes were made to the script of Pitch Perfect 3 after the film enlisted “DoD support”.

    As far as the film in question is concerned, “the way the military is portrayed” could not have been more propagandistic. The heroines were constantly drooling over the handsome, sexy servicemen, there was nonstop saluting, flag-waving and patriotic “thank you for your service” lines, the lead cast did an entire number dressed in camouflage, a lesbian character said she wanted to enlist “now that they let gay people join,” servicemen were portrayed as charming heroes and protectors of women, and life on a military base was portrayed as a fun party where you get to go to awesome concerts and have a great time. You could not possibly pack more glorification of the US war machine into a movie if you tried.

    Air Force Captain Meredith Kirchoff, a public affairs officer at Dobbins Air Reserve Base where the film was shot, gushes over the movie for the way it “humanizes” (read: normalizes) the human resources used to power the American war machine while US civilians are deprived of the basic social safety nets accorded to everyone else in every other major country on earth.

    The US Department of Defense was given a “special thanks to” line at the tail of the end credits.

    Again: there was no discernible reason for this film to be set on military bases. At all. Anyone who gets involved in filmmaking for love of that artistic medium loathes the involvement of any outside influencer putting pressure on them to change their script and produce their movie in a certain way to advance their own agendas, but this film deliberately sought that influence out. From top to bottom, a sequel to a popular movie about an all-female singing group was built to normalize the globe-spanning war machine that is closely approaching a trillion dollar budget and recruit teenage girls into its ranks to be used for slaughter and destruction.

    I love Pitch Perfect. It’s honestly one of my favorite movies ever. It’s an effortless romp of a film about the joy of delightfully unique individuals not overcoming those differences but enthusing about them in each other, enjoying them, embracing them and collaborating together to create something beautiful, inspired, healthy and new. It speaks to my heart about what we have to do as a species to create utopia and avoid self-destruction. To take that and twist it into another advertisement for the blood-thirsty, child-killing, empire building war machine was all kinds of heartbreaking to me.

    When we came home and the kids were out of earshot my husband and I started angrily fuming about what manipulative, disgusting, art-killing parasites these people are, then remembered we have a podcast now so we hit record before we ran out of rage:

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    Thanks for reading! My work here is entirely reader-funded so if you enjoyed this piece please consider sharing it around, liking me on Facebook, following me on Twitter, bookmarking my website, throwing some money into my hat on Patreon or Paypal, or buying my new book Woke: A Field Guide for Utopia Preppers.

  • Citi Reveals The Reason Behind The Market's Meltup

    It is hardly a secret, that one of the biggest threats facing risk assets in 2018 and onward, is the great central bank QE/balance sheet unwind, something we have discussed extensively in the past year, and as a recent example, in “This Is Most Worrying”: In One Year, Central Bank Liquidity Will Collapse From $2 Trillion To Zero,” in which Deutsche Bank said that “the most likely causes of a shift to ‘flight mode’ and a rise in volatility” is that by the end of [2018], the combined expansion of all the major Central Bank balance sheets will have collapsed from a 12 month growth rate of $2 trillion per annum to zero.”

    This is shown in the following chart depicting the total shrinkage in central bank asset growth:

    And yet, despite the Fed’s methodical, if slow balance sheet shrinkage and the ECB’s recent QE tapering from €60 to €30BN per month, followed by the BOJ’s latest “stealth tapering” last week, stocks have started off the new year with a panicked melt-up euphoria the likes of which haven’t been seen in decades as the flurry of recent “serious” headlines suggests.

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    How does one reconcile this historic stock surge at a time of shrinking central bank balance sheets?

    The answer comes from Citigroup’s credit research team, which points out something most central bank unwind projections have missed, namely that while risk assets on central bank balance sheets may indeed be shrinking, other reserve managers are going in the other direction.

    According to Citi’s analysts, the answer is that although both the Fed and ECB are scaling back their balance sheets, the increase in EM FX reserves recently, with Chinese FX reserves doing the majority of the heavy lifting, has largely offset all of this. This is highlighted in the left-hand chart below. In fact, as the right-hand chart shows, on a rolling 3 month basis FX reserve purchases by EMs have largely offset all of the implied downward risk impulse from the past year.

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    As a reminder, last week China reported that its foreign-exchange reserves posted an 11th straight monthly increase, capping a year of recovery amid tighter capital controls, a stronger yuan and resilient economic growth (even if as Goldman calculated much of the reserve increase has been due to valuation effects). At the end of 2017, Chinese reserves climbed by $20.7 billion in December to $3.14 trillion, bringing the full-year increase to $129 billion.

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    Somewhat coincidentally, the theory that China may be goosing the markets was proposed last week by a different group of Citi analysts, who proposed that “it looks like the PBoC has been adding quite a lot of liquidity in the shorter end of the curve in recent days -with a variety of interbank rates softer, and the 1y CGB yield notably lower by 21bps YTD whereas 5s and 10s yields have stayed broadly flat.”

    As we said last week, “assuming that Citi is correct, it would explain many things, not least of all the stunning surge higher in Chinese, global and even US stocks.” Here is Citi’s own “conspiratorial” take:

    Against that background, it is no surprise that equity markets have been so well supported and the SHPROP has exploded upward.”

    In other words, just like China’s aggressive policy change after the Shanghai Accord of February 2016 unleashed a record 21 of 22 positive months for the S&P…

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    … so it again appears to be China’s stealthy asset purchases across global capital markets that has resulted in the market melt-up observed in the end of 2017 and start of 2018.

    Of course, in light of recent vocal warnings from China that its Treasury purchases may be discontinued soon, extrapolating China’s generous intervention in risk assets for the foreseeable future would be dangerous. Meanwhile, even as Beijing may flip and halt accumulating reserves, one thing is certain – at least for now – that central banks will keep on unwinding their balance sheets. Here’s Citi once more:

    given that this aggregate central bank liquidity measure has had a significant degree of correlation with risk asset performance over the past few years, we are if anything reaffirmed in our cautious stance on 2018 as a whole. Even if EM FX reserves were to continue accumulating at close to their current rate, that would be outweighed by the almost $1 trillion reduction in DM central bank balance purchases due to occur this year.

    Citi’s concludes by appropriately wrapping up the balance sheet unwind narrative in the story about the frog – stuck in boiling water – that did not realize how hot the water was until it was too late:

    As the old parable goes, a frog that has the misfortune to find itself in a pot of boiling water will generally have the sense to jump straight back out. But if the water is initially tepid and subsequently brought to boil slowly, the frog won’t realise what’s happening until it’s too late.

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    The announced trajectories of the major central bank balance sheets indicate that the level of aggregate net asset purchases will reach its 2018 lows in the latter part of the year. But while we may only reach boiling point then, we’re already heating up: the delta in tapering is currently very large, with the Fed increasing its pace of net selling and the ECB having halved its net purchase volumes already.

    Citi’s punchline: “the frog may end up getting cooked well before boiling point.” For now, however, the market’s daily record highs make a mockery of any warning, and any references to frogs stuck in boiling water are promptly deflected with tantalizing images of massaging bubbles and “nice warm Jacuzzis.”

  • Caught On Video: Chinese Rocket Booster Crashes To Earth, Erupts In Massive Fireball

    A booster from a Chinese Long March 3B rocket created a massive explosion outside a town in Guangxiv, southwest China on Friday- and the explosion was all caught on video.

     

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    According to the Global Times, the Long March 3B rocket lifted off from Xichang Satellite Launch Centre in Sichuan Province at 07:18 local time on Friday, catapulting two Beidou-3 GNSS navigation satellites to earth’s orbit.

    It is no secret that China’s growth in its space program has been accelerating with the development of the Long March rocket family launching satellites into space. An expanding space program comes in addition to the country’s rising economic power and international influence, which has alarmingly challenged Western space programs.

    As the three-stage rocket with four-strap-on boosters soared towards the heavens, the four boosters separated from the rocket’s core and fell back to earth. One of the boosters landed near a town, while residents panicked as the impact caused a major explosion.

    The village of Xiangdu in Tiandeng Country, Guangxi Zhuang Autonomous Region, is around 700 kilometers from the launch site and considered a “designated drop zones for debris for the launch,” according to the Global Times.

     

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    While the booster smashed into the town, the launch seems to have succeeded in propelling two satellites into orbit. The video below shows the moment the booster slammed into a hillside releasing a toxic plume of hazardous fumes.

     

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    While there were no reports of human casualties; more video has surfaced of curious residents examining the booster up close.

    However, unbeknownst to the observes, the “boosters are filled with unsymmetrical dimethylhydrazine (UDMH) and dinitrogen tetroxide (N2O4) hypergolic propellant, which is highly toxic,” said the Global Times.

    The Global Times calls Friday’s event “all too common,” as China’s space program continues to expand.

    The footage comes in stark contrast to United States launches, which send launch vehicles over the ocean, while private company SpaceX has mastered landing its Falcon 9 first stages back at launch sites and on drone ships off the coast.

    This means that today’s space launches pass over inhabited areas. Though drop zones for Long March rocket stages are carefully calculated and launch notices and procedures put in places, events like the above are all too common, especially with China’s space activities expanding greatly in recent years.

    An unidentified man stands in his living room next to an engine from a Long March rocket in August 2015.

     

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    The Long March 3B rocket has about a 93% success rating, unlike Elon Musk, who has a history of fiery failures with his SpaceX program. Just last week, Musk’s Falcon 9 rocket failed to reach earth’s orbit, therefore losing a billion dollar secretive spy satellite for the United States Government. 

    It’s never good when parts of a rocket coming crashing down to earth, never mind almost smashing into a town. However, the next fireball from the heavens could in the coming months, when a Chinese space station is expected to lose orbit.

  • Burning Iranian Oil Tanker Off China Coast Sinks After One Week

    The Iranian oil tanker burning in the East China Sea for more than a week has finally sunk, Chinese media reported on Sunday. The Sanchi tanker and a cargo ship collided 260km (160 miles) off Shanghai on 6 January, with the tanker then drifting south-east towards Japan. China Central Television said that the Sanchi had gone down after “suddenly igniting” around noon (04:00 GMT).

    Earlier, the Iranian press reported that all 32 crew members – 30 Iranians and two Bangladeshis – on the tanker are dead. The tanker was carrying 136,000 tonnes of ultra-light crude but Chinese officials, credible as always, said there is no major slick.

    Even though some 13 vessels and an Iranian commando unit had been taking part in the salvage operation, amid bad weather, no survivors were found, and according to a spokesman for the Iranian team, Mohammad Rastad, there was no hope of finding any survivors.

    According to BBC, on Saturday, salvage workers had boarded the vessel and found the bodies of two crew members in a lifeboat. Only one other body had been found during the week of salvage operations. The rescue workers retrieved the ship’s black box but had to leave quickly because of the toxic smoke and high temperatures.

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    A map showing the collision point and approximate location a week later: BBC

    The Panama-flagged Sanchi was bringing the condensate from Iran to South Korea when the collision with the Hong Kong-registered freighter CF Crystal, carrying grain from the US, happened in the East China Sea. The crewmen of the Crystal were all rescued.

    The cause of the collision is still not known.

    After the collision the Sanchi drifted at about 2.2km/h (1.4mph), south-eastwards towards the Japanese island of Amami Oshima.

    Condensate is very different from the black crude that is often seen in oil spills. It is toxic, low in density and considerably more explosive than regular crude. Condensate creates products such as jet fuel, petrol, diesel and heating fuel.

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