Today’s News 5th September 2017

  • Merkel, Schulz Agree: "It's Clear, Turkey Should Not Become An EU Member"

    Having blasted Germany for "abetting terrorists," Turkish president Edrogan was on the receiving end of some ire this weekend as the refugee crisis and the EU deal with Turkey dominated the TV debate between Chancellor Angela Merkel and her coalition ally SPD challenger Martin Schulz on Sunday.

    The rivals agreed, however, that Turkey can’t be part of the EU.

    "If I become German chancellor, if the people of this country give me a mandate, then I will propose to the European Council that we end the membership talks with Turkey. Now all red lines are crossed, so this country can no longer become a member of the EU,”said Schulz during the debate, forcing the CDU leader to clarify her position on the issue.

     

    “The fact is clear that Turkey should not become a member of the EU,”said Merkel, agreeing with Schulz.

    “I’ll speak to my [EU] colleagues to see if we can reach a joint position on this so that we can end these accession talks,” added Merkel, who is hoping to get re-elected for a fourth term.

    As RT notes, the government in Ankara is moving away from democratic principles at a “breathtaking” speed, Merkel said, adding that at the moment “the accession negotiations are non-existent.”

    However, she refused to completely freeze the relationship with Turkey.

    Additionally, Reuters reports that the actions of the Turkish authorities are making it “impossible” for the country to join the European Union, an EU executive said on Monday after German Chancellor Angela Merkel called for ending accession talks.

    Quoting European Commission President Jean-Claude Juncker from last week, before Merkel’s election campaign comment, the Commission’s chief spokesman told a regular news briefing:

    “Turkey is taking giant strides away from Europe and that is making it impossible for Turkey to join the European Union.”

    He stressed, however, that any decision on whether to formally halt the long-stalled membership process would be up to the 28 member states of the bloc, not the Brussels executive.

    Turkey has been receiving funding from the EU, which will reach €6 billion by 2018, as part of the deal to halt the migrant flow into Europe, signed in March 2016. Turkey was also promised visa free travel and expedited talks on joining the EU, but the discussion of those issues remains stalled due to Ankara’s refusal to relax its harsh anti-terrorism laws. As EU-Turkish ties hang in the balance, President Recep Tayyip Erdogan has been actively reiterating his threats to withdraw from the deal and again allow migrants to pour into the EU.

     

  • Endless Regional Chaos: American Presence In Afghanistan Explained

    Authored by Federico Pieraccini via The Strategic Culture Foundation,

    The geographic location of Afghanistan has always occupied a central role in many geopolitical studies. Donald Trump’s reasons for reinforcing US troops in the region are driven by the continuing US need to prevent a complete Eurasian integration among regional powers.

    The April peace talks between Afghanistan, India, Pakistan, Russia and China seemed to have put an end to the persistent and dominant American presence in the country. In Washington, following fifteen years of war and a series of failures, many had come to the conclusion that the time had come for the United States to return home.

    Trump had throughout his electoral campaign criticized the foreign policy of his predecessors, giving the indication that he would be looking to leave Afghanistan once he assumed the presidency.

    The road plan for Afghanistan laid out by the April peace talks seemed to offer the prospect of national reconciliation between the Taliban and the central authority in Kabul, assisted by parties with great interest in the country like India and Pakistan, given their geographic proximity, as well as Russia, China and Turkey.

    The first talks in April 2017 capitalized on America's absence at the conference as well as on the will of the protagonists to reach an agreement after fifteen years of war and terror. Afghanistan is a key crossroad in the eastward expansion strategy that illustrates the special partnership between Russia and China, as seen with the steady progress of the Silk Road 2.0 initiative and the Eurasian Economic Union. Given Afghanistan’s geographic position, sharing boundaries with Pakistan, Turkmenistan, Iran, Tajikistan, Uzbekistan, it is useful to emphasize the role the country could play as a commercial and energy hub in the not too distant future.

    Due to incompetence or perhaps due to facing insurmountable pressures, Donald Trump is undergoing a gradual and inexorable diminution with the elimination of all the most representative members of his administration. At the same time, the appointment of military personnel to civilian roles has pushed the administration into unexplored directions not foreshadowed in the electoral campaign. Trump spoke of less US military presence in the internal affairs of other nations. But as we shall see, nothing could be further from the truth.

    The appointment of Generals McMaster, Kelly and Mattis (Mattis perhaps being the most powerful US defense secretary since the end of World War II) is Trump's attempt to withstand and bargain with the most significant elements of America’s deep state. A strong military component in the White House helps ensure continuity in US foreign policy. Contrary to what was professed during the elections, Donald Trump immediately traded American foreign policy in exchange for explicit GOP backing for key legislation that will help secure a 2020 re-election. Without bills on health, tax and immigration reform being passed, there will be no arguments in favor of the GOP and Trump during the midterm and presidential elections in 2018 and 2020 respectively.

    The deep state in Washington has slowly but inexorably taken over Trump's presidency, a task made all the simpler by Trump’s character, which dismisses his lack of experience with an overweening self-confidence. The military component of the deep state, in concert with GOP leaders, took less than six months to quash Trump's electoral promises and turn the president’s foreign policy into a dangerous reprise of the Obama and Bush years.

    More and more frequently, American intervention in foreign lands lead to situations of uncontrollable chaos, with no real central authority able to govern and obey Washington’s orders. The current state of the Middle East is reflective of this. In Afghanistan, Washington, especially Mattis, is cognizant of the country's rebirth under Sino-Russian leadership after fifteen years of America’s presence. This is a scenario that the US deep state is not willing to tolerate.

    Leaving aside Afghanistan’s huge amounts of natural resources (about one trillion in precious metals), as well as its strategic location linking east and west, a peaceful Afghanistan led by a single central authority would hardly cohere with US objectives in the country. The US loves to consider itself the indispensable nation for peace in Afghanistan, when actually it is the main obstacle to peace.

    For American foreign policy continuity, Afghanistan needs to remain in a chaotic situation. Above all, the US military industrial complex is not willing to surrender its political and military power in the country, only to be substituted by Moscow or Beijing. With these unofficial motives, General Mattis announced a surge of several thousand American troops to the country. It is immediately clear that numerically and tactically, four or five thousand soldiers will make no difference. The intent is purely demonstrative, as seen in Syria with a few missiles lobbed at an empty airbase. The purpose is to send a clear and unambiguous message to Russia, China, Pakistan and even India, to the effect that without American consensus, no strategic reorganization is permissible in Afghanistan.

    General Mattis and all those who for decades have been constantly thinking of MacKinder's geopolitical theory (Heartland Theory) are aware of the strategic importance of keeping Afghanistan hostile towards regional powers like China and Russia. The USSR's war in defense of the country, and the socialist superpower’s subsequent collapse, offers a historical warning.

    In April, Moscow and Beijing, with the tacit approval of New Delhi and Islamabad, launched a peace process in Kabul that should have facilitated talks between the central authority and the Taliban to bring about a truce that would bring to an end the violence and destruction that had over fifteen years left the country bleeding in endless poverty and suffering.

    The American surge will not advance American interests in the country. It will not change the delicate balance negotiated between the parties back in April. It will not affect the efforts of Moscow and Beijing to stabilize the country. It will only buy Washington more time by bombing and killing civilians, always viewed by American generals as an acceptable and privileged option available to them.

    Like in other parts of the world, the presence of American troops does not fully explain the long-term goals of military planners. Afghanistan in some respects resembles a similar situation to Southeast Asia. In South Korea, the American presence has persisted since 1950, and with it the destabilization of the Korean peninsula. As in Asia, the central purpose of the American presence in Afghanistan is to occupy geo-strategic zones in order to prevent Eurasian integration between powers like India, China and Russia. Secondly, it is the constant presence of troops and military bases in locations close to or around the two major powers of China and Russia that aims to overburden and thereby diminish the defensive capabilities of these two strategic threats. In 1962, when the USSR did something similar in response to the US deployment of patriot missiles in Turkey, it started building up its offensive capability in the Western Hemisphere using Cuba as a military base. The US was willing to go to war to halt this domestic threat and for weeks the world was on the verge of a nuclear conflict. Only dialogue between American and Soviet leaders averted this threat to human existence.

    Conclusions

    Washington cares for nothing other than its own interests. But twenty-five years after the end of the Cold War, the world is changing, and more and more fruitful efforts to replace the chaos wrought by US policies can be seen with peaceful, mutually beneficial cooperation increasingly being the order of the day. The road to economic prosperity and a re-established unity among the Afghan people is still a work in progress, but once the country manages to establish its independence, Washington will have a hard time dictating conditions. Countries like Russia, China and India have every intention of using diplomacy and peacekeeping to prevent a dangerous escalation in Afghanistan.

    India and China have some divergence over the future of the region, but by the start of the 2017 BRICS conference, they had already resolved a border dispute that lasted over two months. The ability to create diverse organizations like BRICS, AIIB and SCO provides the opportunity to begin any kind of negotiation with a legal and economic foundation. This represents a commendable example of overcoming differences through diplomacy and economic benefits.

    While the United States exhales the last breaths as a declining global power, no longer able to impose its will, it lashes out in pointless acts like lobbing 60 cruise missiles at Syria or sending 4000 troops to Afghanistan. Such acts do not change anything on the ground or modify the balance of forces in Washington’s favor. They do, however, have a strong impact on further reducing whatever confidence remains in the US, closing the door to opportunities for dialogue and cooperation that may otherwise have offered themselves.

    Trump promised isolationism. His generals, behind the scenes, have managed to make this electoral promise come true, leaving Washington alone in the international arena in the near term.

  • Putting North Korea's "Bomb Test" In Context

    On Sunday, North Korea tested its most powerful nuclear bomb yet, detonating a device that caused a 6.3 magnitude tremor.

    The weapon's sheer power has caused alarm but the fact that Pyongyang is claiming it can be fitted inside an intercontinental ballistic missile is sending shockwaves through Asia and beyond.

    Using data from the Center for Strategic and International Studies, Statista's Niall McCarthy presents the following infographic provides an overview of the strength of all North Korean nuclear tests since 2006.

    Infographic: North Korea Tests Its Most Powerful Bomb Yet  | Statista

    You will find more statistics at Statista

    Sunday's detonation was estimated to have been 100 kilotons or more, far more powerful than previous tests and the atomic bombs dropped on Hiroshima and Nagasaki. How does it compare with the warheads inside current U.S. and Russian intercontinental ballistic missiles?

    According to the Economist, the U.S. Trident and Russian SS ballistic missiles have a yield of 455 and 800 kilotons respectively.

  • So Deep, It's Sunk?

    Authored by Robert Gore via StraightLineLogic.com,

    If you strike the king but do not kill him, by definition your position is weak.

    There has never have been a deeper deep state than the Soviet Union’s. It controlled everything: the military, intelligence, the judicial system, the rest of the government, the press, and the economy. It operated in shadows and darkness; there was no loyal opposition or media to shine the occasional light. Yet at 7:32 p.m., December 26, 1991, the Soviet flag was lowered from the Kremlin and replaced with the Russian flag. The Soviet of the Republics of the Supreme Soviet of the Soviet Union’s declaration number 142-H recognized the independence of the Soviet republics. Mikhail Gorbachev had resigned, handing power to Boris Yeltsin. The Soviet Union and its deep state were no more.

    There are still lessons to be generally recognized from the fall of the Soviet Union.

    First and foremost: command and control doesn’t work. That’s a lesson US commanders and controllers and their media and academic fellow travelers ignore at their peril. They cling to their cherished vision of American life directed from above, with the infamous Deep State at the apex of the power pyramid, the ultimate string pullers. Recent maneuvers, however, suggest a Deep State so tangled in its own strings that any attempt to free itself will only make the situation worse.

    A deep state operates submerged from public view. The US deep state had to emerge in its effort to topple Trump, an emergence that screams weakness (see “Plot Holes”). The ineptitude of the effort made the weakness that much more apparent. A claim that Russia had hacked the Democratic Nation Committee (DNC) last summer and then used Wikileaks to disseminate what it had hacked, all in collusion with Donald Trump’s campaign, was the cornerstone of this maladroit coup. It should have raised more eyebrows than it did that the DNC refused to turn over its servers to the FBI for analysis, and that the only confirmation of the hacking claim came from a contractor, Crowdstrike, which had numerous conflicts of interest, including that it was paid by the DNC.

    No objective, scientific analysis of the evidence was performed until that of the Veterans Intelligence Professionals for Sanity (VIPS). That group forensically analyzed the metadata associated with the alleged hack. The speed with which the material was downloaded precluded an Internet based hack. The only way it could have been downloaded so quickly was onto an external storage device. That’s a leak, not a remote hack. It had to have been done by someone with direct access to the DNC’s computer system, which suggests a DNC insider, perhaps Seth Rich.

    Alternative news site consortiumnews.com published the VIPS’ analysis and conclusions . Mainstream “confirmation” followed at the left-leaning thenation.com. With its cornerstone gone, the Russian collusion story collapsed. For form’s sake Special Prosecutor Mueller will fan the embers for the next few months, perhaps uncovering a technical violation or two of this or that inconsequential law, perhaps releasing some sort of face saving report, but even the most rabid anti-Trumpers appear to recognize that the Russian hack dog won’t hunt.

    If this is the best the supposed all-powerful deep state could come up with, then the deep state isn’t nearly as powerful as supposed. The way this affair was handled buttresses that conclusion, because it opens deep staters to serious legal liability.

    Before the election they thought they would be shielded by a Clinton administration, but now they’re wide open to prosecution for a number of possible crimes. There is the FBI’s dereliction of duty, not performing its own analysis of DNC servers and accepting Crowdstrike’s conclusions without further scrutiny. (It was apparently in bed with the Clinton camp from the get-go.) There are the multiple leaks to friendly news outlets of classified information. There are the intelligence reports with their damning and much-reported, but evidence free, best assessments and probable conclusions. Potentially the most legally troublesome: a cabal of deep state insiders concocted their story to unseat a duly elected United States president. That makes out a prima facie case of treason.

    If you strike the king but do not kill him, by definition your position is weak. He can exact ultimate retribution and your head is in a basket, or he can let you twist in the wind. The best guess is that Trump will do both, depending on the specifics of each conspirator’s situation and which course will be most useful to him.

    When California Senator Diane Feinstein says conciliatory things about Trump, infuriating her base, you know things have changed. As ranking Democrat on the Senate Judiciary Committee, she has also joined chairman Charles Grassley requesting interviews with two high-ranking FBI officials concerning the discredited Trump dossier. She’s one of the shrewdest power players in Washington, a deep state stalwart. Her effort with Grassley and her conciliation aren’t magnanimous gestures from the bottom of her black heart. Rather she’s bending the knee; Trump has won the game of thrones.

    When the major mainstream media outlets in unison condemn Antifa’s violent tactics, you know things have changed. George Soros, meet Donald Trump and the new order. The condemnations toss the latest kerfuffle about what Trump said after Charlottesville down the memory hole, and give Trump cover to do something about fringe violence in the future. The extremists are by no means finished; that wouldn’t serve anyone’s purposes. They’ll make handy scapegoats; you never know when there’s going to be a fire at the Reichstag.

    There has been a tiresome litany of articles about Trump’s capture by the deep state, characterizing him as a puppet for the military and Goldman Sachs. Whatever idealism motivated his run for president is gone and he’s now supposedly just an errand boy. The commentators who bemoaned the firing of Michael Flynn dusted off their articles, changed and rearranged a few things, and bemoaned the departure of Steve Bannon. Poor Donald’s all by himself in big, bad Washington. Except he’s mowing down his enemies one by one (it looks like James Comey may be next), and he’s got the deep state cornered. As for his associates, if there’s one clear lesson from Trump’s life it’s that everyone—wives, employees, Goldman Sachs flunkies, generals, you name it—is expendable. Some of those he’s terminated in the past probably thought they had the upper hand.

    Many of the same Trump-as-puppet commentators dusted off their articles bemoaning Trump’s bombing of the Syrian air base, changed and rearranged a few things, and bemoaned Trump’s Afghanistan escalation. Few of those latter articles mentioned that the Syrian government, with the aid of Russia, Iran, and Hezbollah, has turned the corner on quashing the rebellion, ISIS is on the run, and Syrian refugees are returning home. All of which sets the stage for the US to eventually leave Syria. Look for something similar to eventually play out in Afghanistan, and to go similarly unremarked upon.

    Donald Trump didn’t risk all for the Iron Throne to let Goldman Sachs and the military run the show. He has allied with those power centers, but he’s calling the shots. Trump has allied with another power center: state and local police departments. He has given them fulsome, vocal support, encouragement to be more brutal, rescission of President Obama’s civil asset forfeiture rollback, and promises of more military gear. This is what one would expect of a ruler bent on consolidating his power—secure the praetorians. The Bill of Rights won’t stand in the way of sealing that alliance.

    Trump’s supporters can’t believe their man’s primary motivation is acquiring power. Trump’s enemies, other than Senator Feinstein, can’t believe how good he is at it. Neither side will recognize the real danger until it’s too late. Legions of worrywarts fret that an erratic, captured Trump will go off half-cocked and press a nuclear button or do something else almost as stupidly devastating. What should worry them are the precise calculations and bloodless strategies of the most ruthlessly Machiavellian president since Franklin D. Roosevelt as he further consolidates and extends his power. Given present jurisprudence, nothing in the Constitution stands in his way.

  • North Korea Seen Moving ICBM Into Position For Possible Launch: Report

    The USDJPY and 10Y yields snapped lower and gold kneejerked higher following the latest North Korea-related headline out of Bloomberg, according to which:

    • NKOREA STARTS MOVING ICBM FOR POSSIBLE LAUNCH BEFORE SAT.:DAILY

    Bloomberg references a just released article in the Asia Business Daily, according to which North Korea started moving the ICBM-class missile, produced at a new Pyongyang research center, on Monday following Sunday’s thermonuclear test.

    The report confirms overnight intelligence from South Korea: recall first thing this morning, Yonhap reported that South Korea’s spy agency said it had detected that North Korea is making preparations for a possible intercontinental ballistic missile launch, a move that would further raise tensions a day after it conducted its sixth and most powerful nuclear detonation.

    Chang Kyung-soo, acting chief of the defense ministry’s policy planning office, told lawmakers on Monday that North Korea was making preparations for a missile firing, according to Bloomberg while Yonhap adds that South Korea’s spy agency said there was a chance the North could fire an ICBM into the Pacific Ocean, saying that the isolated state was able to conduct a nuclear test at any time.

    According to the just released Business Daily report, there is high chance N. Korea will fire ICBM missile before Sept. 9 national founding day. More details from the original report, Google translated:

    According to the authorities, one ballistic missile produced by a weapons research institute dedicated to the production of North Korea’s ICBM was found to be moving to the west of Hwanghae Island after being mounted on the 4th Mobile Launch Base (TEL) on the day after the 6th nuclear test.

    Earlier this year, North Korea built a 1980-square-meter weapons lab, which could manufacture ICBMs, in Pyongyang. It was last February that the weapon laboratory was released to the outside world. Although it was a wilderness until 2009, it has now been transformed into a strategic hub for North Korea’s major missiles.

    According to a joint US-ROK report, North Korea has a maximum of 900 ballistic missiles, and it has been confirmed that there are 108 aircraft capable of launching surprise attacks. According to ballistic missiles, the number of Scud missiles and TEL that can mount Scud missiles are the most common. The number of Scud missiles is 430 (TEL 36).

    The report concludes by noting that according to S. Korean intel, “if North Korea conducts further ICBM provocations there is a high possibility that it will choose an unpredictable time and place. To this end, Pyongyang may launch missiles directly from the mobile launch base, or launch multiple missiles at multiple locations simultaneously.

    The report also notes that the ICBM mobile launcher is moving “at low speed mainly during the night time” to avoid detection by foreign intelligence authorities. In other words, the US now has a conveniently moving target and a due date by which North Korea will likely launch its next rocket, effectively giving Trump a greenlight for a “preemptive” strike over the next five days.

    The market’s reaction to the news, while not as dramatic as to Sunday’s nuclear test, confirms just how much on edge traders remain for every headline out of North Korea.

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  • Ron Paul Explains Why "Government 'Aid' Only Makes Disasters Worse"

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

    Texans affected by Hurricane Harvey, including my family and me, appreciate the outpouring of support from across the country. President Donald Trump has even pledged to donate one million dollars to relief efforts. These private donations will be much more valuable than the as much as 100 billion dollars the federal government is expected to spend on relief and recovery.

    Federal disaster assistance hinders effective recovery efforts, while federal insurance subsidies increase the damage caused by natural disasters.

    Federal disaster aid has existed since the early years of the republic. In fact, it was a payment to disaster victims that inspired Davy Crockett’s “Not Yours to Give” speech. However, the early federal role was largely limited to sending checks. The federal government did not become involved in managing disaster relief and recovery until the 20th century. America did not even have a federal agency dedicated solely to disaster relief until 1979, when President Jimmy Carter created the Federal Emergency Management Agency (FEMA) by executive order. Yet, Americans somehow managed to rebuild after natural disasters before 1979. For example, the people of Galveston, Texas successfully rebuilt the city following a major hurricane that destroyed the city in 1900.

    FEMA’s well-documented inefficiencies are the inevitable result of centralizing control over something as complex as disaster recovery in a federal bureaucracy.

    When I served in Congress, I regularly voted against federal disaster aid for my district. After the votes, I would hear from angry constituents, many of whom would later tell me that after dealing with FEMA they agreed that Texas would be better off without federal “help.”

    Following natural disasters, individuals who attempt to return to their own property – much less try to repair the damage – without government permission can be arrested and thrown in jail.

    Federal, state, and local officials often hinder or even stop voluntary rescue and relief efforts.

    FEMA is not the only counterproductive disaster assistance program.

    The National Flood Insurance Program was created to provide government-backed insurance for properties that could not obtain private insurance on their own. By overruling the market’s verdict that these properties should not be insured, federal flood insurance encourages construction in flood-prone areas, thus increasing the damage caused by flooding.

    Just as payroll taxes are unable to fully fund Social Security and Medicare, flood insurance premiums are unable to fund the costs of flood insurance. Federal flood insurance was almost $25 billion in the red before Hurricane Harvey. Congress will no doubt appropriate funding to pay all flood insurance claims, thus increasing the national debt. This in turn will cause the Federal Reserve to print more money to monetize that debt, thus hastening the arrival of the fiscal hurricane that will devastate the US economy. Yet, there is little talk of offsetting any of the costs of hurricane relief with spending cuts!

    Congress should start phasing out the federal flood insurance program by forbidding the issuance of new flood insurance policies. It should also begin reducing federal spending on disaster assistance. Instead, costs associated with disaster recovery should be made 100-percent tax-deductible. Those who suffered the worst should be completely exempted from all federal tax liability for at least two years. Tax-free savings accounts could also help individuals save money to help them bear the costs of a natural disaster.

    The outpouring of private giving and volunteer relief efforts we have witnessed over the past week shows that the American people can effectively respond to natural disasters if the government would get out of their way.

  • Japan Prepares For Mass Evacuation Of 60,000 Citizens From South Korea

    It won’t be the first time that a near-panicked Japan has came close to the edge when it comes to North Korea, and in preparation for an “emergency” was planning to evacuate its citizens located in South Korea. The last such notable spike in escalations took place in April, when as the Yomiuri Shimbun reported at the time, the Japanese government had asked the U.S. to provide advance consultation if it is about to launch military action against North Korea, and “ramped up preparations for emergency situations”, including the potential evacuation of some 57,000 Japanese citizens currently in South Korea.

    Fast forward to today, when moments ago Japan’s Nikkei reported that as tensions on the Korean Peninsula reach new heights following Pyongyang’s first (allegedly) hydrogen bomb test, Japan is planning a possible mass evacuation of the nearly 60,000 Japanese citizens currently living in or visiting South Korea.

    “There is a possibility of further provocations,” Japanese Prime Minister Shinzo Abe said at a Monday meeting with ruling coalition lawmakers. “We need to remain extremely vigilant and do everything we can to ensure the safety of our people.”

    In response to North Korea’s sixth nuclear test, Japan and the U.S. are seeking a peaceful resolution by ratcheting up economic pressure on the rogue state through an oil embargo and other measures, while South Korea’s president has also called for a currency/FX blockade of the Kim regime. And yet, what has spooked Tokyo is that on Sunday, Defense Secretary James Mattis also said any threat to the U.S. or its allies “will be met with a massive military response – a response both effective and overwhelming.” Which means thousands of Japanese may soon be in harm’s way.

    According to Nikkei, there are currently about 38,000 long-term Japanese residents in South Korea, as well as another 19,000 or so tourists and other short-term travelers. “If the U.S. decided on a military strike against the North, the Japanese government would start moving toward an evacuation on its own accord regardless of whether the American plans are public,” a Japanese government source said.

    Tokyo is working on a four-tier emergency plan based on the severity of the situation: discouraging unessential travel to South Korea, discouraging all travel to South Korea, urging Japanese citizens there to evacuate, and finally, urging them to shelter in place.

     

    Should skirmishes erupt between the two Koreas, for example, the Japanese government would discourage all new travel to South Korea. At the same time, it would urge citizens already there to evacuate using commercial flights. Although the Japanese Embassy would help secure airline reservations, the government’s role under this scenario would mainly be to provide information.

     

    But Japan would need to coordinate with South Korean authorities under a shelter-in-place scenario. If Pyongyang launched a major military attack that leads to the closure of South Korean airports, the Japanese embassy would urge citizens still in the country to stay at home, or move to a safer area within the South.

    Also in case of a worst case scenario, Seoul has agreed to give Japanese citizens access to safe zones, such as designated subway stations, churches and shopping malls, according to a Japanese source. The Japanese government has already provided its citizens in South Korea with information on over 900 such facilities.

    Furthermore, in the event of airport closures, the best option for Japanese citizens to return home would be by sea from the southeastern port city of Busan. The Japanese government is working to obtain cooperation from U.S. forces stationed in South Korea to transport evacuees across the country from Seoul to Busan.

    Additionally, the Japanese Self-Defense Forces would need permission from South Korea’s government to operate inside the country. Approval has not been forthcoming, Yonhap reports, and could provoke a backlash from a South Korean public harboring historical grievances at the former colonial power. But SDF vessels could help in ferrying Japanese citizens home from Busan.

    Such a crises could make it easier for terrorists and other dangerous individuals to enter Japan disguised as returning citizens. The Japanese government aims to work with the U.S. to prevent such unlawful entry. One proposal would create a temporary holding area for returnees in Busan or Japan.

     

    “We are looking at a range of responses” to a crisis on the Korean Peninsula, from securing evacuees and processing their entry to creating and operating holding facilities, as well as determining whether Japan is responsible for their protection, Abe had said at a parliamentary session in April.

    As we reported in April, and as the infographic below showed, the Japanese government has been contemplating five potential emergency responses should a military clash break out between the US and North Korea. They include the following:

    • Logistical support by Japan’s Self-Defense Forces (SDF) in the event of a local conflict
    • Use of force by the SDF in the event of a full scale war
    • Protection of Japanese citizens in South Korea
    • Preparation for armed attacks against Japan
    • Civil protection and response to evacuees 

  • Get Out While You Still Can: Paris Hilton Pitches An ICO On Twitter

    The ICO market just received an endorsement from the reality television star who tried to copyright the phrase "that's hot."

    Hotel-empire heiress Paris Hilton revealed on twitter that she’s joined the ICO party just as the Chinese government has announced harsh new restrictions that will make it virtually impossible for its citizens, some of the most voracious buyers of these coins, to participate in new offerings.

    Hilton said this weekend that she’s “looking forward” to participating in an offering called Lydiancoin.

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    According to Business Insider, LydianCoin is a platform that wants to combine the blockchain with "targeted, AI driven digital marketing and advertising services." In its white paper (of course, the company launching the offering hasn’t actually built the product yet), advertising-tech company Gravity4 aims to raise $100 million by selling 20 million Lydian coins at $5 a pop. As BI reports, Gravity4's CEO Gubaksh Chahal pleaded guilty to assault in 2014 after being accused of beating his girlfriend, and was accused of violating his probation by assaulting another woman.

    Hilton joins a pack of celebrities who’ve used their presence on social media to hype ICOs. Floyd “Crypto” Mayweather, has publicized his investments in a handful of ICOs. Dennis Rodman notoriously wore a t-shirt advertising an ICO called “potcoin” when he returned from visiting Kim Jong Un in North Korea earlier this year.

    Rapper the Game has been talking up Paragon Coin, a coin that aims to “revolutionize” the legal marijuana market.

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    As BI notes, the involvement of celebrities is a sign that ICOs are going mainstream. However, with governments from China to Russia – and even the SEC in the US – preparing to crack down on the nascent market, which is expected to raise nearly $2 billion this year according to analysts at Pitchbook, the combined power of regulators in some of the biggest markets for digital currencies could swiftly put an end to the party.

    According to Bloomberg, fans and skeptics of ICOs will interpret Hilton’s involvement differently.

    To critics of the booming world of ICOs, Hilton’s involvement is the latest example of a fad finance trend that has already seen the offerings raise $1.25 billion this year. To its supporters, it’s evidence of the networking effect that will quicken the development of ICOs.

    Not that the market needs any help. Some of the most successful ICOs have raised more than $200 million – with little more than a white paper sketching out their product idea. Inevitably, the vast majority of these coins will quickly become worthless, while their creators will have extracted hundreds of millions of dollars in wealth from unwitting buyers.

    Get out while you still can.

  • Red October In Washington In 2017?

    Submitted by Iben Thranholm

    Red October in Washington in 2017?

    I recently I came across a video on Youtube showing a presentation by former Soviet KGB propagandist Yuri Bezmenov, aka Tomas Schuman, who worked for Novosti Press Agency during the Soviet era until he defected in 1970. Yuri Bezmenov issued a strong warning to America that they were not living in an age of peace and love as many believed. Quite the contrary, he claimed. America was slowly being subverted into Marxism. He predicted that it would eventually lead to a revolution in the USA that would put an end to the free world. The question is if the revolution in the US he warned against is just about to happen.

    The 1983 video shows a lecture he delivered in Los Angeles on methods of “ideological subversion”, a form of warfare the KGB used against America.

    Bezmenov explains that the main effort of the KGB was not conventional intelligence at all. Only some 15 per cent of resources was spent on James-Bond-style espionage, while 85 per cent was devoted to a slow process called “ideological subversion” or “active measures”.

    What this means, Bezmenov explains, is to change Americans’ perception of reality to such an degree that no American is able to draw a sensible conclusion in the interest of defending themselves, their families, communities and their country, regardless of the abundance of information available to them. It is a massive brainwashing process achieved at a very slow pace. 

    The process is split into four stages: 1) demoralization, 2) destabilization, 3) crisis, and 4) normalization.  

    In his book “Love Letter to America” from 1984, Bezmenov explains how the main principle of ideological subversion is turning a stronger force against itself, and the crucial role demoralization plays in that process.

    He writes, “It takes about 15 to 20 years to demoralize a nation. Why that many (or few)? Simple: this is the minimum number of years needed to ‘educate' ONE GENERATION of students in a target country (America, for example) and expose them to the ideology of the subverter. It is imperative that any sufficient challenge and counter-balance by the basic moral values and ideology of this country be eliminated.

    The main methods used by Marxists in the West, Bezmenov explains, were to: “corrupt the young, get them interested in sex, take them away from religion. Make them superficial and enfeebled […] destroy people's faith in their national leaders by holding the latter up for contempt, ridicule and disgrace […] cause breakdown of the old moral virtues: honesty, sobriety, self-restraint, faith in the pledged word.

    The main targets are religious faith, education, media and culture – hippie-movement of that day. Although to all appearances America firmly rejected Soviet Communism during the Cold War, Bezmenov very correctly observes that there was a massive undercurrent of Marxist-Leninist indoctrination at many, if not most, universities and institutions of learning, in the media and artistic communities in the West throughout the 1960s and 1970s that was never challenged or counterbalanced by fundamental American patriotic values. This was especially true of the entertainment industry. According to Bezmenov, a group of rock or pop-musicians with a message of 'social-justice' sugar-coated in popular 'spiritual' tunes was actually more helpful to the KGB than someone standing in the pulpit preaching Marxist-Leninist doctrine. 

    The 1983 video shows Bezmenov explaining that the demoralisation process in the US had already been completed to a degree beyond the wildest dreams of the top leadership in the Kremlin.

    This proces was done by Americans to Americans thanks to lack of morals.  Most of the people educated in the 1960s, intellectuals are now occupying the positions of power in the government, civil service, mass media and the education system. You are stuck with them,” Bezmenov points out. 

    This has resulted in the ideology of Cultural Marxism, which consists of eroding all traditions and values, thus destroying the foundations of Judeo-Christian culture. The initial round of Marxism, implemented in 1917 in Russia, was mainly about economical reforms and the distribution of financial goods. This model has now collapsed with the demise of the Soviet Union. No one fights for state socialism any more. Multinational companies have taken over. However, the spirit of Communism lives on in the West, the cradle of Marxism, in the shape of false compassion, freedom and equality in absurd measure. The second coming of Marxism, which now unfolds in the West, assumes the form of identity politics, which aims to obliterate all distinctions based on race, gender, culture and religion, using the weapon of open borders and mass immigration. The special target is the traditional family, which s attacked constantly and viciously in the attempt to create a culture in which identity and fundamental relations are dissolved. Transgenderism is another way to deprive a human of his or her fundamental identity. All this is done in order to allow the state or large multinational corporations to control these individuals, who no longer know for certain who they really are. As Soviet Communism dismantled economic class distinctions, cultural Marxism and  multiculturalism will obliterate all identity and national distinctions in order to facilitate global control of the masses. The white, Christian male, branded as a supremacist, is the new capitalist or nobleman, who must go to the scaffold, like the czar and his courtiers. Accusation of hate-speech is the new form of censorship that radical leftists apply to control all discourse. The media have manipulated the concept of truth beyond all recognition of truth and falsehood. Truth is what the powers that be want to apply. 

    As we witness the current development in the USA, especially after the violent clashes in Charlottesville and the disturbances and violence instigated by movements like Antifa and Black Lives Matter, it is relevant to ask – following Bezmenov’s analysis – if the third item, the crisis, of the “ideological subversion” process is unfolding before our eyes in the USA. According to Bezmenov it may take only six weeks to bring a country to the verge of crisis ( as we saw it in Central America in the 1970s) and – after the crisis – the violent change of power, structure and economy, the period of normalization begins, which will usher in a new regime. We have seen the same method used in the Middle East with the Arab Spring, and the Maidan coup in Ukraine in 2014. Western society is now undergoing the same process with destabilization through radical leftist movements and dominance of social justice warriors.

    Just now, protesters carry out a ten-day “civil disobedience” march starting on 28 August in Charlottesville, Virginia, headed to Washington D.C. to fight white supremacy and demand that President Trump be removed from office. 

    "The March to Confront White Supremacy" states it will travel to the nation's capital and then occupy it with non-violent demonstrations. 

    "For years, white supremacist violence, rhetoric, and policies have escalated and intensified – exploding during Donald Trump’s run for president and reaching a boiling point in Charlottesville," the event’s web site reads.

    "We demand that President Trump must be removed from office for allying himself with this ideology of hate and we demand an agenda that repairs the damage it has done to our country and its people," the march organizers wrote. 

    Professor Mark Bray, a historian and lecturer at Dartmouth, author of a new book entitled "Antifa: The Anti-Fascist Handbook,” defined the Antifa movement recently in an interview on NBC News: 

    It’s basically a politics or an activity of social revolutionary self-defence. It’s a pan-left radical politics uniting Communists, Socialists, Anarchists and various different radical leftists together for the shared purpose of combating the far right.

    In the interview, Bray explains that anti-fascists go about resisting fascism, and discusses if they are ethically reasonable as collective self-defence against fascism and Nazism."

    The resistance against the “old, conservative America”, also visible in the dismantling of statues, is now so strong that the opposition to Trump think it is reasonable to discuss if the de radical leftist movements are ethically defensible in their fight against what they call fascism and the policies the claim Trump represents. 

    As I see it, this bears an uncanny resemblance to the political events leading up to the October revolution in Russia in 1917. Antifa, the tearing down of statues and the march on Washington now resemble the revolutionary Bolshevik uprising that brought down the government in 1917 and later, in February 1918, deposed Czar Nicolas II.  Although today’s protesters currently joining in the "The March to Confront White Supremacy” from Charlottesville to Washington DC claim that they are non-violent, their aim is – with or without violent clashes – to depose President Trump and his presidency. If they succeed sooner or later in ousting the president, like the Democrats have attempted to do together with the radical leftist ever since Trump was inaugurated, it will actually amount to a coup d’etat like in the Bolshevik revolution in Russia. 

    This will complete the ideological subversion that Yuri Bezmenov warned against and take it into its final stage, which is normalization. If this happens, everything we have understood American culture to be will be replaced by pure cultural Marxism, that is, a new kind of Soviet regime with multiculturalism as its ideology. 

    Paradoxically, these are the very political movements that spearhead the hysteria of accusations of Russian involvement in America’s democratic elections and Trump’s alleged cooperation with the Russians. The radical leftists hate Russia because they cannot forgive them for abandoning Marxism and instead embracing conservative, Christian values as the foundations of modern Russia.

    Yet how will the right and the movement behind Trump react if the radicals leftist attack Trump in earnest? Former Trump adviser Roger Stone believes a civil war would ensue if Congress were to impeach President Donald Trump.

    In case he is right, the question is whether the right will be able to win such a civil  war. Their Achilles’ heel is that they are themselves soaked in the dye of moral and spiritual culture Marxist ideological subversion. There are few genuine conservatives left, but many of them are moral relativists, who live by the cultural Marxist creed. A good example is British homosexual media personality Milo Yiannopoulos, who often rails against the leftists. In a speech entitled “10 things Milo hates about Islam”, he proclaims his hatred of the left, but simultaneously swears his allegiance to it. He states:

    On the one hand, we’re defending America from the excesses of the left, and the threat they represent to free expression and freedom of association. On the other hand, we have to defend the good things that the left has achieved – women’s rights, gay rights, and tolerance […]

    Thus is the precise predicament in which the right in the West is stuck. They are against the left’s position on mass immigration, but their morals, culture and spirituality are cut from the same cloth. Not that conservatives are against respect and tolerance, but the right’s desire for civil rights are often based on moral relativism, which is at the core of cultural Marxism.

    Demoralization has also had its effect on the right, and therefore it has not the moral superiority to win the battle. It is not fundamentally separate from the left on sexuality and family. The West currently has no real alternative to cultural Marxism unless an entirely new movement arise that re-establishes eternal moral values defined as faith, love, freedom, conscience, family, motherland and nation. Bezmenov also points this out at the closing of his lecture, as he calls for “a very strong national effort to educate people in the spirit of real patriotism and to explain the real danger of socialism, communism, welfare state and big brother state. If people will fail to grasp the impending danger, nothing ever can help the USA. Then its good bye to freedom”, he concludes.

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Today’s News 4th September 2017

  • New NGO Racket: Smuggling, Inc.

    Authored by Soeren Kern via The Gatestone Institute,

    • Although the European Union successfully bribed Turkish President Recep Tayyip Erdogan last year — inducing him to slow the flow of migrants heading through Turkey into Greece — Italy has received almost 100,000 people so far this year.
    • This summer, even more than in previous years, it has become plain that some of the NGOs working in the Mediterranean are acting as something more than intermediaries. Many have in fact been acting as facilitators. This makes the NGOs effectively no more than the benign face of the smuggling networks. Undercover workers have also discovered NGOs handing vessels back to the smugglers' networks, effectively helping them to continue their criminal enterprise indefinitely.
    • A group that which seeks to oppose Europe's current self-destructive insane trajectory can now not even source independent financial support. Groups, however, that continue to push Europe along its current trajectory continue to get all the official support they need. In the difference in reaction to these two groups lies a significant part of the story of the ruin of a continent.

    Sometimes it is in the gap between things that the truth emerges.

    In recent years Europe has been on the receiving end of one of the most significant migrant crises in history. In 2015, in just a single year, countries such as Germany and Sweden found themselves adding 2% to their respective populations. Although much of the public continue to labour under the misapprehension that those still coming are fleeing the Syrian civil war; in fact, the majority of those now entering Europe are from Africa, particularly from sub-Saharan Africa.

    Although the European Union successfully bribed Turkish President Recep Tayyip Erdogan last year — inducing him to slow the flow of migrants heading through Turkey into Greece — Italy has received almost 100,000 people so far this year. Spain — which had ducked much of the movement of recent years — now finds itself receiving thousands of people who are sometimes (as in this memorable footage from earlier this month) simply landing on the country's beaches and running straight into the country. In doing so, they are not only breaking into Europe in a fashion that is illegal, but flouting all the asylum protocols, and other protocols, however inadequate, that are meant to exist.

    In reaction to such events, the Spanish authorities have done something extraordinary. They have gone the way of the Italian authorities and made more efforts to intercept boats heading towards the country. Not in order to turn them around or block them, but in order to "rescue" them. In merely one day last week, the Spanish coastguards "rescued" 600 migrants. The purpose of the quotation marks around "rescue" is because its use in this context is highly contestable. Somebody may be rescued from a burning car, or rescued from a sinking boat. But if thousands of people intentionally head across narrow stretches of water, it can hardly be said that each and every one of them has been "rescued'.

    What have they been rescued from? They may be rescued from war. Or they may be rescued from poverty. Or slightly less rosy economic prospects than someone born in Spain. Most of these people have simply been rescued from Africa or whatever their country of origin. This situation leads to the questions which European politicians even now refuse to address — which is whether Europe should indeed be "rescuing" anyone who ends up in a boat near Europe.

    Whenever they are polled, the public in Europe consistently say that they want the migration to slow down or stop. This is a majority opinion in every European country. Across the EU as a whole, a recent survey found that 76% of the European public think that the European Union's handling of the whole crisis has been poor. But it is in the gap between the treatment of two actors in this crisis that we can discern a terrible fact about the fate of Europe.

    Throughout the crisis of recent years — and especially since the height of the crisis in 2015 — the official vessels operated by the European states have been joined by members of non-governmental organsations (NGOs), either on the vessels or running vessels of their own. A significant amount of the "rescue" part of the migrant crisis (finding boats and transferring those onboard onto safe vessels or guiding their vessels into port) has been done by NGOs. Organisations such as Save the Children and Médecins sans Frontières have been invited to do this by European government agencies, and many of them receive significant levels of government funding as well as charitable giving from the public.

    Yet, this summer, even more than in previous years, it has become plain that some of the NGOs working in the Mediterranean are acting as something more than intermediaries. Many have in fact been acting as facilitators. Agents who have infiltrated the NGO groups have found collusion between the NGOs and the smugglers networks, including coordination with these brutal and mercenary organisations. Investigations have found NGOs to have been breaking their own agreed operating rules by coordinating locations to meet and pick up vessels sent out by the smugglers. This makes the NGOs effectively no more than the benign face of the smuggling networks. Undercover workers have also discovered NGOs handing vessels back to the smugglers' networks, effectively helping them to continue their criminal enterprise indefinitely.

    Some NGOs that work to pick up migrants from boats in the Mediterranean and transport them to Europe have been discovered handing vessels back to smuggler networks, helping their criminal enterprise. Pictured: A small rubber boat overcrowded with migrants passes a boat set alight by the crews of Phoenix, a vessel operated by the "Migrant Offshore Aid Station" (MOAS) NGO, after all passengers were evacuated, on May 18, 2017. MOAS's protocol of torching the smuggling boats after debarkation prevents smugglers from reusing the vessel. (Photo by Chris McGrath/Getty Images)

    In frontline countries such as Italy, this unlawful activity has been causing growing public anger. Elsewhere in Europe, the notion that these NGOs are not entirely angelic in their operations is taking longer to sink in. But compare the reaction to them — in receipt as they continue to be of large quantities of public and governmental money — with a group that has a different view to that of the NGOs.

    At the start of this summer, a group called "Defend Europe" raised money to hire and sail a ship off the coast of Italy. The ship aimed to deter migrants from crossing the Mediterranean. One activist was recorded saying, "We want to get a crew, equip a boat and set sail to the Mediterranean ocean to chase down the enemies of Europe." Some of the other characters and rhetoric associated with this movement may be equally unsavoury. For some weeks, the "Defend Europe" vessel, with banners prominently displayed, has floated in the Mediterranean and told people in a variety of languages, "No Way. You will not make Europe home" and "Stop human trafficking."

    Now one may abhor this tactic, approve of it, or feel a whole range of emotions in between. The treatment of "Defend Europe', however, compared to the pro-migration NGOs, is startling. In recent weeks, when the "Defend Europe" vessel had some minor technical problems, it caused undisguised glee in the Western media. The suggestion that a pro-migration NGO vessel might have to rescue it caused even more delight. Now the group has had its sources of funding withdrawn. Not that "Defend Europe" would ever have received government aid. Far from it. But this past week, the US-based crowd-funding website Patreon shut down the group's profile page, making it impossible for them to raise funds through it. The ostensible cause was that Patreon believed the actions of "Defend Europe" were "likely to cause loss of life."

    It may easily be argued, of course, that pro-migration NGOs that are colluding with smuggling gangs and assisting them in their work are "likely to cause loss of life", if not in the Mediterranean then in encouraging thousands of people to give their money to smuggling gangs and encouraging millions more to set out for a new life in a continent which is increasingly less likely to receive them with warmth. A group that seeks to oppose Europe's current self-destructive trajectory can now not even source independent financial support. Groups, however, that continue to push Europe along its current trajectory continue to get all the official support they need. In the difference in reaction to these two groups lies a significant part of the story of the ruin of a continent.

  • The Rise Of The Deep State: How They Got Their Power To Manipulate For Ultimate Control

    Authored by Mac Slavo via SHTFplan.com,

    While many in the United States firmly believe that the government just isn’t working, it is.  But it’s only working for the powerful and rich elites in the government and the media who have a desire to cling to their oppressive control of others and the money many are willing to allow them to steal.

    The fight has never been between the republicans and the democrats.

    As Americans choose sides, their rights and freedoms are sold to the highest bidder. According to Intellectual Takeout, the fight is between “us” and the deep state; not those on the right and those on the left.  More and more often we are seeing bureaucrats, lobbyists, and elected officials of both parties circle the wagons in an effort to prevent any true reforms of the government. They constantly write laws they exclude themselves from,  come up with inventive ways to tax us to our breaking point and destroy the healthcare system.  And this is all by design.

    According to Joost Meerloo in his seminal book The Rape of the Mind, the author discusses the psychology of brainwashing that’s allowing every American to succumb to tyranny right before their eyes and not only not realize it, but beg for more oppression.  “The burning psychological question is whether man will eventually master his institutions so that these will serve him and not rule him,” said Meerloo in his discussion of the Deep State or the “administrative machine” published in 1956.

    Meerlo describes the rise of the deep state as:

    “… The development of a kind of bureaucratic absolutism is not limited, however, to totalitarian countries. A mild form of professional absolutism is evident in every country in the mediating class of civil servants who bridge the gap between man and his rulers. Such a bureaucracy may be used to help or to harm the citizens it should serve.

     

    It is important to realize that a peculiar, silent form of battle goes on in all of the countries of the world — under every form of government — a battle between the common man and the government apparatus he himself has created. In many places we can see that this governing tool, which was originally meant to serve and assist man, has gradually obtained more power than it was intended to have.

     

    Governmental techniques are no different from any other psychological strategy; the deadening hold of regimentation can take mental possession of those dedicated to it, if they are not alert. And this is the intrinsic danger of the various agencies that mediate between the common man and his government. It is a tragic aspect of life that man has to place another fallible man between himself and the attainment of his highest ideals.”

     

    The Rape of the Mind

    Meerlo goes on to say that the power of simply being in government will corrupt:

    Being a high civil servant subjects man to a dangerous temptation, simply because he is a part of the ruling apparatus. He finds himself caught in the strategy complex. The magic of becoming an executive and a strategist provokes long-repressed feelings of omnipotence. A strategist feels like a chess player. He wants to manipulate the world by remote control. Now he can keep others waiting, as he was forced to wait himself in his salad days, and thus he can feel himself superior.

     

    The Rape of the Mind

    But what we are seeing now is not only the corruption of the government.

    We are witnessing the deep state pulling the strings of every politician and fight to keep their power and moneyThe members of the Deep State are fighting for not only their jobs and their power but their sense of being. It is an ego boost to control entire populations. But what meaning do they have in life if they were shown that they are in fact dispensable, that they and their departments can be eliminated? In the end, their egos depend upon the maintenance and growth of the power and prestige.

    Over many decades, the very government so many still trust to keep them safe has put in place compulsive orders, red tape, and regulations while expanding exponentially to enforce what it creates and stealing more tax money to cover the rising costs. All the while, its roots drive deeper and deeper into the very government many still fight to protect. Even the politicians who we send to D.C. thinking that they represent us are ensnared in the game. They begin to play by the rules set forth by the Deep State; indeed, our elected officials even become dependent upon the Deep State.

    So the question is, how do we combat the deep state and get our freedom back?

  • Trump Has Decided To End DACA, "Igniting A Political Firestorm"

    On Friday, the White House announced that Trump would make his decision whether to end the Obama-era Deferred Action for Childhood Arrivals (DACA), or “Dreamer, program on Tuesday. Well, we won’t have to wait to long, because according to Politico, Trump has made the decision to end the DAVA program with a six-month delay.

    Trump, who has faced strong warnings from both Democrats and Republicans not to scrap the program and struggled with his own misgivings about targeting minors for deportation, is said to have made up his mind and according to Politico, “senior White House aides huddled Sunday afternoon to discuss the rollout of a decision likely to ignite a political firestorm — and fulfill one of the president’s core campaign promises.”

    Trump will announce his decision on Tuesday, with Politico noting that the White House informed House Speaker Paul Ryan of the president’s decision on Sunday morning. Ryan had said during a radio interview on Friday that he didn’t think the president should terminate DACA, and that Congress should act on the issue. However, Trump’s conversations with Attorney General Jeff Sessions, who argued that Congress rather than the executive branch is responsible for writing immigration law, helped persuade the president to terminate the program, although Politico hedges that “the White House aides caution that — as with everything in the Trump White House — nothing is set in stone until an official announcement has been made.”

    In what appears to be another victory for the recently exiled “nationalist” wing of the Trump inner circle, the president’s expected announcement is likely to shore up his base, which rallied behind his broader campaign message about the importance of enforcing the country’s immigration laws and securing the border. At the same time, the president’s decision is likely to be one of the most contentious of his early administration, opposed by leaders of both parties and by the political establishment more broadly. It also indicates that despite his departure, Steve Bannon still continues to have major influence on the Trump White House.

    Still, in a nod to reservations held by many lawmakers, the White House plans to delay the enforcement of the president’s decision for six months, giving Congress a window to act, according to one White House official. But a senior White House aide said that chief of staff John Kelly, who has been running the West Wing policy process on the issue, “thinks Congress should’ve gotten its act together a lot longer ago.”

    As a result, the vast majority of the nearly 800,000 people brought to the country illegally as children and who have benefitted from the program, are expected to lose their legal basis for continued presence in the United States, promoting even greater animosity between the Trump administration and the immigrant community.

  • 'Gunfight' Starts Over School Supplies At WalMart (Or Why Amazon Is 'Winning')

    If you had any reasons to question why increasing numbers of Americans are turning to Amazon.com for their everyday and anyday needs, the following clip will erase them…

    On Monday of last week, an argument broke out between two pairs of women over the last notebook on the shelf at the Novi Towne Center WalMart store, according to police.

    Video from a bystander shows a woman pull out a gun during the fight

    The fight involved two Farmington Hills residents, ages 46 and 32, and a mother and daughter from South Lyon, ages 51 and 20.

    WCRZ-FM reports that the two Farmington Hills women were shopping for school supplies, and when one of them reached for the last notebook on the shelf, a South Lyon woman also reached for it. Police told the Free Press that it was the 20-year-old who reached for it.

    The two women pulled the 20-year-old’s hair, and the woman's mother was pushed aside before pulling out a gun, according to Fox2Detroit.

    *  *  *

    And that's why Amazon's sales are soaring…

  • Latest Projections Show Hurricane Irma Headed For Florida

    As Hurricane Irma continues to move  west as a Category three storm, in what still is said to be an indeterminate path, according to the latest projections from Met Scientist Michael Ventrice, it now looks like Florida has the highest probability of a US landfall…

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    …though that doesn’t mean the Gulf of Mexico can rest easy. Hurricane forecasting is notoriously inaccurate one or two weeks out…

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    Before it nears the US, however, the storm is headed toward the Northern Caribbean, threatening to bring flooding rain and damaging winds to the Leeward Islands. Preparations for the storm should already be taking place in these areas, according to Accuweather.com.

    “Rain and gusty winds may start as early as Tuesday,” AccuWeather Senior Meteorologist Rob Miller said.

    According to Accuweather, Irma’s intensity has vacillated over the past few days. But the storm is expected to strengthen to a category four hurricane with sustained winds of 130-156 mph as it approaches the islands. Thereafter, the storm will turn to the north and west over the coming days. This track will put Antigua and Barbuda, Montserrat, St. Kitts and Nevis, Anguilla and the British Virgin Islands, in the brunt of the storm's rain and wind spanning Tuesday and Wednesday.

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    Cruise and shipping vessels in the hurricane’s path will need to reroute.

    Later in the week, Irma will move close to Puerto Rico and Hispaniola with the worst of the storm expected to miss the islands to the north. Even so, rough surf, gusty winds and heavy rain will increase.

    Experts are concerned that the Turks and Caicos Islands and the Bahamas could face dangerous conditions at the end of the week and into the weekend as Irma passes nearby or possibly through the islands. Impacts will be severe if Irma maintains its strength and passes over them.

    Ultimately, the storm could land in Florida, Georgia, the Carolinas or even closer to the Delmarva Peninsula. Or it could curve northward and miss the east coast entirely.

    “The eastward or northeast progression of a non-tropical system pushing across the central and eastern U.S. this week will highly impact the long-range movement of Irma,” AccuWeather Hurricane Expert Dan Kottlowski said.

    How fast or slow this non-tropical system moves will determine whether Irma takes a west-northwest path toward the southern Atlantic Seaboard or gets steered north and away from land.

    * * *

    Readers may be wondering, if the storm slams southeast Florida, as is looking increasingly likely. Well, the Miami Herald spoke with one engineer who built a “dynamic” weather forecasting model that incorporates data like rainwater evaporation rates and how much of a given surface area is paved.

    “Omar Abdul-Aziz, an engineer and assistant professor at West Virginia University, has done just that with a new model he built while at Florida International University as part of a state-funded project to improve hurricane loss models. At the request of the Herald, he agreed to run three rainfall scenarios that might resemble Hurricane Harvey.

     

    The maps he produced stretch from Homestead north to Port St. Lucie, not including barrier islands which are separate land masses, and depict flooding after 48 hours from 20 inches of rain, 30 inches of rain, and 40 inches of rain.

     

    Because the maps cover a large area, they don’t show flooding at street level. But Abdul-Aziz said they do provide a far more accurate picture of what would happen across the region.”

    If his models are accurate, residents of densely populated cities like Miami might want to start bracing for floods. Abdul-Aziz found that floodwaters in parts of Miami, Hialeah, South Dade and Fort Lauderdale could rise between nine and 17 inches at least with this amount of rain. And with 40 inches of rain, flooding in those same neighborhoods, as well as many more, rises to between 23 inches and more than three feet — enough to begin damaging houses and partially submerge cars.

    “Because of the flat land and low elevation, water does not move fast. It goes slow and the drainage capacity is not designed to take that much rainfall,” he said.

    To build the model, funded with $533,000 from the state, Abdul-Aziz used the Environmental Protection Agency’s latest stormwater management model, which has been used since the 1970s to help communities plan water and sewer systems. They include local hydrology, land cover, ground level and local climate, but cover a smaller area.

    Abdul-Aziz mapped out three different flooding scenarios below:

     

    To be sure, the storm is still at least a week away. Depending on atmospheric conditions, it could menace a wide stretch of the US east coast. If it’s still a powerful category 3 or 4 storm when it hits – as projections suggest it would be – the US could be bracing for its second major natural disaster in two weeks.

  • China Battles "Impossible Trinity"

    Authored by James Rickards via Daily Reckoning blog,

    Just because something is inevitable does not mean it cannot be postponed.

    The popular name for this is “kicking the can down the road,” which is a perfectly good description.

    I prefer more technical terms such as dynamic systems in “subcritical” and “supercritical” state space, but it amounts to the same thing.

    A financial crisis can be a long time in the making, but it will definitely erupt. When it does, there will be huge losses for those who ignored the warning signs.

    China is in a pre-crisis situation today.

    It is confronting the harsh logic of the “Impossible Trinity.”

    The Impossible Trinity theory was advanced in the early 1960s by Nobel Prize-winning economist Robert Mundell. It says that no country can have an open capital account, a fixed exchange rate and an independent monetary policy at the same time.

    You can have one or two out of three, but not all three. If you try, you will fail – markets will make sure of that.

    Those failures (which do happen) represent some of the best profit-making opportunities of all.

    Understanding the Impossible Trinity is how George Soros broke the Bank of England on Sept. 16, 1992 (still referred to as “Black Wednesday” in British banking circles. Soros also made over $1 billion that day).

    The reason is that if more attractive total returns are available abroad, money will flee a home country at a fixed exchange rate to seek the higher return. This will cause a foreign exchange crisis and a policy response that abandons one of the three policies.

    But just because the trinity is impossible in the long run does not mean it cannot be pursued in the short run. China is trying to peg the yuan to the U.S. dollar while maintaining a partially open capital account and semi-independent monetary policy. It’s a nice finesse, but isn’t sustainable.

    China cannot keep the capital account even partly closed for long without drying up direct foreign investment. Similarly, China cannot raise interest rates much higher without bankrupting state-owned enterprises.

    China is buying time until the Communist Party Congress in October.

    It’s important to realize that for Beijing, the Chinese economy is more than about jobs, goods and services. It’s a means of ensuring its legitimacy. The Chinese regime is deeply concerned that a faltering economy and mass unemployment could threaten its hold on power.

    Chinese markets are wildly distorted by the actions of its central bank. Given the problems inherent in trying to manage an economy without proper price signals, the challenge facing Beijing gets harder by the day.

    China has a long history of violent political fracturing, and the government is deeply worried about regime survival if it stumbles. Many in the West fail to appreciate Beijing’s fears and overestimate the support it has among the disparate Chinese people.

    What does China do next?

    Under the unforgiving logic of the Impossible Trinity, China will have to either devalue the yuan or see its reserves evaporate.

    In the end, China will have to break the yuan’s peg to the dollar in order to stop capital outflows without killing the economy with high rates. The Impossible Trinity really is impossible in the long run. China will find this out the hard way.

  • Gold Pops, Stocks Drop As Futures Open After Korean Chaos

    In an echo of last week's move following North Korea's teating of missiles across Japan's territory, futures markets are opening in a decidedly risk-off mannwr following North Korea's "hydrogen bomb" test. Dow Futs down 100 points, Gold jumping and Treasury bonds bid…

     

    All major US equity indices are down…

     

    Gold is back above $1340…

     

    USDJPY broke below 110.00

     

    And VIX futures are spiking back into last week's Korea crisis region…

     

    Of course, what happens next is anyone's guess as last week saw the BTFDers panic-buy stocks to their best week in 10 months1

  • VIX Set For Lowest Annual Average Ever, But…

    While intra-month the CBOE Volatility Index reached its highest since November, before plunging back to earth into the end of the month, VIX is still on track to post its lowest annual average on record.

    Bloomberg notes that in the past decade, VIX gains in August were followed by September declines in all but one instance.

    While VIX has collapsed so far this year, it may not last.

    Though VIX ended up paring its August gain to 3.2% – a gauge tracking longer-term wagers posted its biggest increase since January 2016.

    In fact, after last month’s 11 percent gain, the CBOE S&P 500 3-Month Volatility Index has reached its highest level relative to the VIX since Aug 2012's European credit crisis.

    The September Federal Reserve gathering and debt-ceiling discussions are among events that could lead to increased market volatility at a time when the S&P 500 Index trades near a record high.

  • What Will Stabilize Used Vehicle Sales? (Hint: Nothing Good)

    Authored by Daniel Ruiz via Blinders Off blog,

    Until this point, a lot of what I've shared with you is theoretically based on my knowledge and experience of used vehicle values and how I believe they affect new vehicle sales velocity. Today, I am going to share some some hard data that I've been researching with a great deal of effort.

    I genuinely believe that used vehicle values have a very significant effect on new vehicle sales velocity. I have explained it on Twitter and on a previous blog post through the concept of trade cycles. Because of this, I am certain that used vehicle values can be used as a leading indicator for inventory management at the manufacturing level, at the retail dealer level and certainly as an investment tool. However, I humbly hold that current used vehicle value indexes sources are not good enough.

    There is a very specific group of vehicles that can be monitored in order to better project results. The Manheim and NADA index both have too much noise in the data. For example, the Manheim Index has no model year restrictions and includes new vehicle price inflation in the calculations. NADA goes up to 8 model years. Both average the data over multiple months and include vehicles which, in my opinion, have little to no impact on new vehicle sales velocity. Therefore, I have decided to make my own index.

    For now, I'm going to use Ford as an example please ignore the red residual line until later.

    I have said numerous times that passenger vehicles are at a different points in the value cycle than trucks and SUVs.

    This is common knowledge at this point, and most have placed their faith on trucks and SUVs. This includes manufacturers shifting production and rental car companies changing their fleet mix to the better performing SUV and truck sector. Most analyst are looking at fuel prices to mark the top of the SUV and truck market. Here's what they've missed:



    Here's WHY this matters:

    Now back to residuals. What I want to drive home, in simple terms, is that assuming no change in demand, supply precedes price changes. When used vehicle values underperform residual values, the return rate of leases goes up. The opposite is also true. Less vehicles returned means less auction volume supporting higher prices. More vehicles returned means more auction volume supporting lower prices. Look at the charts again and note the acceleration of used vehicle value declines when used vehicle values fall below residual values. So where do we stand today? You tell me if this looks supportive of higher used vehicle values:

    You might wonder what will stabilize used vehicle values going forward. Consider this, a used vehicle is nothing more than a new vehicle transaction that drove off the dealer's lot.

    The answer, years of declining new vehicle sales and we are just getting started.

    If you feel that my insight might be a useful part of your investment decisions in the automotive sector, I offer phone consultations as well as in-person presentations through GLG.

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Today’s News 3rd September 2017

  • De-Dollarization Accelerates: China Readies Yuan-Priced Crude Oil Benchmark Backed By Gold

    Authored by Tsvetana Paraskova via OilPrice.com,

    The world’s top oil importer, China, is preparing to launch a crude oil futures contract denominated in Chinese yuan and convertible into gold, potentially creating the most important Asian oil benchmark and allowing oil exporters to bypass U.S.-dollar denominated benchmarks by trading in yuan, Nikkei Asian Review reports.

    The crude oil futures will be the first commodity contract in China open to foreign investment funds, trading houses, and oil firms. The circumvention of U.S. dollar trade could allow oil exporters such as Russia and Iran, for example, to bypass U.S. sanctions by trading in yuan, according to Nikkei Asian Review.

    To make the yuan-denominated contract more attractive, China plans the yuan to be fully convertible in gold on the Shanghai and Hong Kong exchanges.

    Last month, the Shanghai Futures Exchange and its subsidiary Shanghai International Energy Exchange, INE, successfully completed four tests in production environment for the crude oil futures, and the exchange continues with preparatory works for the listing of crude oil futures, aiming for the launch by the end of this year.

    “The rules of the global oil game may begin to change enormously,” Luke Gromen, founder of U.S.-based macroeconomic research company FFTT, told Nikkei Asia Review.

    The yuan-denominated futures contract has been in the works for years, and after several delays, it looks like it may be launched this year.

    Some potential foreign traders have been worried that the contract would be priced in yuan.

    But according to analysts who spoke to Nikkei Asian Review, backing the yuan-priced futures with gold would be appealing to oil exporters, especially to those that would rather avoid U.S. dollars in trade.  

    “It is a mechanism which is likely to appeal to oil producers that prefer to avoid using dollars, and are not ready to accept that being paid in yuan for oil sales to China is a good idea either,” Alasdair Macleod, head of research at Goldmoney, told Nikkei.

  • "Don't Mess With Yellowstone Supervolcano" Geologists Warn NASA

    Two weeks ago, we reported that Brian Wilcox, a former member of the NASA Advisory Council on Planetary Defense, had shared a report on what the Space Agency considered one of the greatest natural threats to human civilization: the Yellowstone “supervolcano.”

    Following an article published by BBC about super volcanoes last month, a group of NASA researchers got in touch with the media to share a report previously unseen outside the space agency about the threat Yellowstone poses, and what they hypothesize could possibly be done about it. 

    “I was a member of the NASA Advisory Council on Planetary Defense which studied ways for NASA to defend the planet from asteroids and comets,” explains Brian Wilcox of Nasa’s Jet Propulsion Laboratory (JPL) at the California Institute of Technology. 

    “I came to the conclusion during that study that the supervolcano threat is substantially greater than the asteroid or comet threat.”

    Yellowstone currently leaks about 60 to 70% of its heat into the atmosphere through stream water which seeps into the magma chamber through cracks, while the rest of the heat builds up as magma and dissolves into volatile gasses. The heat and pressure will reach the threshold, meaning an explosion is inevitable. When NASA scientists considered the fact that a super volcano’s eruption would plunge the earth into a volcanic winter, destroying most sources of food, starvation would then become a real possibility.  Food reserves would only last about 74 days, according to the UN, after an eruption of a super volcano, like that under Yellowstone.  And they have devised a risky plan that could end up blowing up in their faces.  Literally.

    Wilcox hypothesized that if enough heat was removed, and the temperature of the super volcano dropped, it would never erupt. But he wants to see a 35% decrease in temperature, and how to achieve that, is incredibly risky. One possibility is to simply increase the amount of water in the supervolcano. As it turns to steam. the water would release the heat into the atmosphere, making global warming alarmists tremble.

    “Building a big aqueduct uphill into a mountainous region would be both costly and difficult, and people don’t want their water spent that way,” Wilcox says. “People are desperate for water all over the world and so a major infrastructure project, where the only way the water is used is to cool down a supervolcano, would be very controversial.”

    So, NASA came up with an alternative plan: the smartest people on earth believe the most viable solution could be to drill up to 10km down into the super volcano and pump down water at high pressure. The circulating water would return at a temperature of around 350C (662F), thus slowly day by day extracting heat from the volcano. And while such a project would come at an estimated cost of around $3.46 billion, it comes with an enticing catch which could convince politicians (taxpayers) to make the investment.

    “Yellowstone currently leaks around 6GW in heat,” Wilcox says. “Through drilling in this way, it could be used to create a geothermal plant, which generates electric power at extremely competitive prices of around $0.10/kWh. You would have to give the geothermal companies incentives to drill somewhat deeper and use hotter water than they usually would, but you would pay back your initial investment, and get electricity which can power the surrounding area for a period of potentially tens of thousands of years. And the long-term benefit is that you prevent a future supervolcano eruption which would devastate humanity.”

    To be sure, NASA itself admitted that drilling into a super volcano comes with its own risks, like the eruption that scientists are desperate to prevent. Triggering an eruption by drilling would be disastrous.

    “The most important thing with this is to do no harm,” Wilcox says. “If you drill into the top of the magma chamber and try and cool it from there, this would be very risky. This could make the cap over the magma chamber more brittle and prone to fracture. And you might trigger the release of harmful volatile gases in the magma at the top of the chamber which would otherwise not be released.”

    Now, it is others’ turn to slam the NASA plan: according to a geologist at Yellowstone national park, the proposal could have dire consequences, including killing countless animals.

    According to the Star, Dr Jefferson Hungerford, who works at Yellowstone, has warned NASA scientists to stay away from the volcano. He said that: “messing with a mass that sits underneath our dynamic Yellowstone would potentially be harmful to life around us.

    “It would potentially be a dangerous thing to play around with.” And he questioned whether the drilling could even work, saying “we’re not there scientifically”.

    More importantly, Dr Hungerford said there is no need for anything to be done proactively at Yellowstone, adding: “We won’t see [an eruption]. Very likely we will never see it.

    Perhaps he is correct: the Earth has 20 known supervolcanoes, which if they erupt, would trigger planet-changing effects. Major eruptions are incredibly rare, with the last one approximately 26,500 years ago in New Zealand. But if a similar event occurred today, it would cause a nuclear winter with humans wiped out in just a few months from starvation.

    For now, what some of the smartest people in the world disagreeing on what to do next, the increasingly more precarious status quo is the most likely outcome.

  • Three Dangerous Delusions About Korea

    Authored by James George Jatras via The Strategic Culture Foundation,

    They say that most of the world’s real dangers arise not because of what people don’t know but because of what they do 'know' that just ain’t so.

    As a case in point, consider three things about Korea that the bipartisan Washington establishment seems quite sure of but are far removed from reality:

    Delusion 1: All options, including U.S. military force, are «on the table.»

    – Everyone knows there are no military «options» the U.S. could use against North Korea that don’t result in disaster. The prospect that a «surgical strike» could «take out» (a muscular-sounding term much loved by laptop bombardiers) Pyongyang’s nuclear and missile capabilities is a fiction. Already impractical when considered against a country like Iran, no one believes a limited attack could eliminate North Korea’s ability to strike back, hard. At risk would be not only almost 30,000 U.S. troops in Korea but 25 million people in the Seoul metropolitan area, not to mention many more lives at risk in the rest of South Korea and perhaps Japan.

     

    – Hence, any contemplated U.S. preemptive strike would have to be massive from the start, imposing a ghastly cost on North Koreans (do their lives count?) but still running the risk that anything less than total success would mean a devastating retaliation. That’s not even taking into account possible actions of other countries, notably China’s response to an American attack on their detestable buffer state.

    Delusion 2: North Korea must be denuclearized.

    – Whether anyone likes it or not, North Korea is a nuclear weapons state outside the Nuclear Non-Proliferation Treaty and will remain so. Kim Jong-un learned the lessons of Saddam Hussein and Muammar Gaddafi. Because Kim has weapons of mass destruction, especially nukes, he gets to stay alive and in power. If he gives them up, he can look forward to dancing the Tyburn jig or getting sodomized with a bayonet, then shot. That’s not a difficult choice.

    Delusion 3: If the U.S. presses China hard enough, Beijing will solve the problem for us.

    – There is no combination of U.S. sanctions, threats, or pressures that will make Beijing take steps that are fundamentally contrary to China’s vital national security interests. (Here, the «vital national security» of China means just that, not the way U.S. policymakers routinely abuse the term to mean anything they don’t like even if it has nothing to do with American security, much less with America’s survival.) Aside from speculation (which is all it is) that China could seek to engineer an internal coup to overthrow Kim in favor of a puppet administration, maintaining the current odious regime is Beijing’s only option if they don’t want to face the prospect of having on their border a reunited Korean peninsula under a government allied with Washington.

     

    – After Moscow’s experience with the expansion of NATO following the 1990 reunification of Germany, why would Beijing take credibly any assurances from Washington (of which there is no indication anyway) not to expand into a vacuum created by a collapse of North Korea? Quite to the contrary, it has been suggested that if China refuses to deal with the North Korea problem on Washington’s behalf, then the U.S. would do it on its terms, presenting Beijing (in the description of former U.S. ambassador to the United Nations John Bolton) with «regime collapse, huge refugee flows and U.S. flags flying along the Yalu River.» Adds Bolton, «China can do it the easier way or the harder way: It’s their choice. Time is growing short.» If under such a scenario U.S. forces end up on China’s border, suggests Bolton, they wouldn’t be leaving anytime soon. Don’t be so sure. In 1950, the last time American forces were on the Yalu River, they weren’t there very long when hundreds of thousands of Chinese soldiers crossed into Korea. Keep in mind that happened when China didn’t have nuclear weapons but the U.S. did.

    The seemingly weekly rise and fall of the decibel level of bellicose rhetoric coming out of Washington and Pyongyang obscures the realities behind these three delusions. Little change can be expected from Pyongyang, whose policy at least has the virtue of simplicity: «if you do anything bad to us, we’ll do something really, really bad to you.»

    So then, what are the prospects Washington could jump off the hamster wheel and come up with something besides threats and sanctions? The omens are not auspicious. Just before he left the White House, Steve Bannon violated the taboo surrounding Delusion 1: «Until somebody solves the part of the equation that shows me that ten million people in Seoul don't die in the first 30 minutes from conventional weapons, I don't know what you're talking about, there's no military solution here, they got us.» Then he was gone.

    But let’s be optimistic. There have been reports of direct «back channel» contacts between North Korea and the U.S. at the United Nations in New York. Even Bolton suggests that some kind of accommodation could be made to China in the form of a pullback of U.S. forces down to the south, near Pusan, so as to be still «available for rapid deployment across Asia.» (Certainly, that’s one idea. Here’s a better one: how about getting us out of Korea entirely and not having Americans available for deployment across Asia?)

    The definitive clarification should have been the Beijing-based Global Times editorial of August 10, 2017 («Reckless game over the Korean Peninsula runs risk of real war»), universally seen as reflecting the position of the Chinese government:

    «China should also make clear that if North Korea launches missiles that threaten U.S. soil first and the U.S. retaliates, China will stay neutral. If the U.S. and South Korea carry out strikes and try to overthrow the North Korean regime and change the political pattern of the Korean Peninsula, China will prevent them from doing so».

    That means that if Kim attacks the U.S., he’s on his own. If we attack Kim, we’re at war with China. In the latter case, while Russia would not likely directly join the fray we can be sure Moscow would provide China total support short of belligerency. Put mildly, this would not be in the American interest.

    There is one, and only one overriding priority that should now guide U.S. policy on Korea. It’s not regime change in North Korea – despite that regime’s loathsomeness – or even the wellbeing of South Korea or Japan. It’s avoiding Kim’s developing a missile system capable of delivering a nuclear weapon to the United States. How close North Korea might be to such a capability is the subject of wildly conflicting estimations. (Regarding the American lives hung out on the DMZ, there’s a simple solution to ensuring their safety – get them the hell out of there.)

    But what about South Korea and Japan? Our «alliances» with them are a fiction. The U.S. guarantees their security but other than cooperating on the defense of their own territory they do nothing to safeguard ours, nor can they. The U.S. derives no benefit in continuing to make ourselves a target on account of a place that’s more than five thousand miles from the American mainland.

    It’s time that «America First!» meant something. As a start, Washington could take seriously Beijing’s proposal for a double-freeze. On the one hand, Pyongyang would suspend its nuclear and missile programs, in particular halting tests of weapons with potential intercontinental range. Washington and Seoul would suspend joint military exercises, including practicing so-called «decapitation strikes« aimed at North Korea’s leadership.

    If protecting our own territory and people is American officials’ top priority, and not, as they implausibly claim, «regime change» in North Korea, it’s hard to see why a double-freeze would not be a sensible first step. It would be largely up to China to see that the North Koreans complied with their part of the deal. If they did, perhaps it could lead towards a long-overdue settlement of this Cold War-era standoff and, in time, a reunited, neutral Korea. If not, all bets are off – but we’d be hardly worse off than we are now.

  • Modi's Demonetization Called "Colossal Failure That Ruined Economy" As India GDP Growth Slumps To 2-Year Lows

    India's embattled Prime Minister Narendra Modi faced a double whammy of abuse this week as his nation's economic growth collapsed to its weakest since Q1 2014 and India's Central Bank released a report on Modi's extraordinary "demonitization" plan last year showing that 99 per cent of the high denomination banknotes cancelled last year were deposited or exchanged for new currency, crushing Modi's lie that his contentious 'war on cash' would wipe out huge amounts of so-called 'black money'.

    When Modi announced in November that Rs1,000 ($16) and Rs500 notes would no longer be legal tender, he suggested that corrupt officials, businessmen and criminals — popularly believed to hoard large amounts of illicit cash — would be stuck with “worthless pieces of paper”. At the time, government officials had suggested that as much as one-third of India’s outstanding currency would be purged from the economy – as the wealthy abandoned or destroyed it, rather than admit to their hoardings – reducing central bank liabilities and creating a government windfall.

    Since he unleashed his cunning plan, India's GDP growth has slowed dramatically.

    After India's Composite PMI collapsed, India's Q2 GDP growth slowed to 5.7% – its weakest since Q2 2014…

     

    And now, as The FT reports, the Reserve Bank of India’s annual report on Wednesday suggested that most holders of the old currency managed to dispose of it, estimating that banned notes worth Rs15.28tn ($239bn) were returned to the bank. That amounts to 99 per cent of the Rs15.44tn of the old high-value notes that were in circulation when Mr Modi made his announcement, according to the finance ministry.

    The government’s critics were quick to seize on the RBI’s announcement as evidence of the policy’s failure.

    “99 per cent notes legally exchanged! Was demonetisation a scheme designed to convert black money into white?” former finance minister P Chidambaram tweeted.

     

    Rahul Gandhi, de facto leader of the opposition Congress party, tweeted: “A colossal failure which cost innocent lives and ruined the economy. Will the PM own up?”

    The bank’s figures are a political embarrassment to Mr Modi, who had appealed to the nation to endure the disruption and hardship to punish the rich and corrupt, and deprive them of their ill-gotten gains.

    Many lower income Indians hard hit hard by cash shortages supported the demonetisation policy because they believed the rich were suffering more.

    It appears they were suckered!

  • Van Halen, M&Ms, And The Next Market Downturn

    Authored by Adam Taggart via PeakProsperity.com,

    The planet-sized egos of rock & roll performers are legendary.

    Few things symbolize this better than the outrageous requests they often make when on tour.

    These requests are referred to as "riders", and appear in the contract a tour venue receives in advance of the artist's arrival. These contract riders specify the physical conditions that the singer/band requires to be in place before arriving to perform. Stage lighting settings, sound equipment, furnishings, etc — that kind of stuff.

    And these rider requests can get pretty funky – often extremely so — when it comes to backstage perks the performers want.

    For example: A wooden pond filled with koi carp (Eminem). A driver who will not speak or make eye contact (Katy Perry). 20 white kittens and 100 doves (Mariah Carey). Seven dwarves (Iggy Pop). 50,000 bees (Slayer). A sub-machine gun (Mötley Crüe). And, yes, even a great white shark (Hank III).

    The practice of making these kind of outrageous demands stems from a rider Van Halen inserted into the contract for its 1982 world tour, which insisted on a bowl of M&Ms to be provided backstage, but with all of the brown M&Ms removed.

    As this image below of the actual rider shows, the band was very explicit in its seriousness about this:

    Once the media got whiff of this, it had a field day roasting the band's narcissistic chutzpah. A new high-water mark of diva capriciousness had been established, which quickly became legend. A feat of prima donna pampering that subsequent performers have been trying to top ever since.

    But as crazy as it sounds, Van Halen's "no brown M&Ms" rider had nothing to do with caprice. There was a solid rationale behind it.

    In fact, it was quite brilliant.

    The Importance Of Effective Indicators

    Van Halen's 1982 world tour was a massive production, involving a tremendous amount of gear and technical complexity. The contract the band sent in advance to venues was so thick due to all the details within, it was referred to as the "Chinese Yellow Pages".

    Non-compliance with the requirements in the contract could have serious consequences that could ruin the show, or even jeopardize lives.

    So when the band rolled up to its next venue, it needed a quick way to determine if the stage crew there had complied with all of the specifications within its contract.

    And that's why the "no brown M&Ms" rider was inserted. The band could simply hop off the bus and check the candy bowl. If they found brown M&Ms, they knew the contract hadn't been carefully read. And then they'd immediately call for a full-line check of the entire set.

    As lead singer David Lee Roth detailed in his autobiography:

    Van Halen was the first band to take huge productions into tertiary, third-level markets. We’d pull up with nine eighteen-wheeler trucks, full of gear, where the standard was three trucks, max. And there were many, many technical errors — whether it was the girders couldn’t support the weight, or the flooring would sink in, or the doors weren’t big enough to move the gear through.

     

    The contract rider read like a version of the Chinese Yellow Pages because there was so much equipment, and so many human beings to make it function. So just as a little test, in the technical aspect of the rider, it would say “Article 148: There will be fifteen amperage voltage sockets at twenty-foot spaces, evenly, providing nineteen amperes …” This kind of thing. And article number 126, in the middle of nowhere, was: “There will be no brown M&M’s in the backstage area, upon pain of forfeiture of the show, with full compensation.”

     

    So, when I would walk backstage, if I saw a brown M&M in that bowl … well, line-check the entire production. Guaranteed you’re going to arrive at a technical error. They didn’t read the contract. Guaranteed you’d run into a problem. Sometimes it would threaten to just destroy the whole show. Something like, literally, life-threatening.

    Genius.

    Through its rider, the band had created a easy-to-monitor and trustworthy indicator. No brown M&Ms, and the show was likely set up to go smoothly. But if otherwise, don't perform until the entire venue is scrutinized for other missed requirements.

    The lesson to take from Van Halen's wisdom is that having good indicators is key to achieving success.

    This is also extremely true for the world of investing, where you are deploying capital based upon an expected future return. How do you determine when it's a good time to enter into an investment? Once in it, how do you monitor the conditions supporting your rationale for holding it — are those changing? And if so, are they getting better or worse? When should you exit the position?

    For all of these questions, the better the indicators you use, the more accurate and informed your decision-making will be. And the better your returns as an investor will be.

    When The Indicators Are Giving A Signal, Pay Attention

    Over the years, we've compiled a large number of indicators that we monitor closely on an ongoing basis here at PeakProsperity.com. They most definitely inform our economic outlook and forecasting.

    We'll dedicate an upcoming report to laying out the sources and metrics we place the greatest weighting on. But several that we're watching closely right now come from two market analysts that we highly respect.

    The first set comes from Lance Roberts, chief strategist/economist for Clarity Financial. Lance is renowned for his excellent charts and ability to highlight key changes in data trends. Below are several indicators he's recently featured, suggesting weariness in the US financial markets and growing likelihood of economic recession.

    First, the S&P 500 is showing signs of topping out, having broken below the trading range of its latest 8-month bullish trend, and its MACD momentum indicator displaying two recent sell signals:

    Lance warns that such signals suggest that further price gains will be "volatile and limited" unless the S&P returns into its bullish channel. If it indeed does not and drops below the key resistance level of 2390, he sees a swift price correction of 12% as a real possibility.

    But he then combines this near-term technical analysis with more far-sighted data to make the point that the financial markets are not just overbought, but dangerously overvalued at this point. Similar to John Hussman (another producer of market indicators we value highly), Lance shows that, because today's prices are the result of pulling so much of tomorrow's valuation into today (e.g., via the suppression of interest rates and overexuberant speculation), we are living at a rare time in history where the average market return for the next 20 years may well be negative:

    And he recently caught our attention by surfacing this chart of the change in annual Real Value Added to the US economy, a metric that hadn't been on our radar beforehand. This has been a reliable indicator of recession in the US for nearly 70 years, and is now signaling that we've likely already entered one:

    Couple Lance's indicators with those of our other expert, Grant Williams, portfolio advisor at Vulpes Investment Management and co-founder of Real Vision TV. Grant and the team at Real Vision recently issued their latest Killer Charts series, which adds validation and additional weight to Lance's warnings.

    First off, Grant and his team see similar technical signs of "exhaustion" in the S&P 500 and predict lower prices ahead:

    Note that they don't just expect the S&P to correct slightly and then continuing powering higher. Other indicators they track, like the equities-vs-commodities ratio, strongly suggests a bubble peak for the S&P. From here they predict a secular bear trend for stocks (possibly paired with a new bull trend in commodities):

    And like Lance, Grant sees signs that the US economy is poised to slow further…

    .. and is likely, as Lance also concludes, tipping into recession:

    When smart analysts independently find the same patterns in the data, it's time to take notice.

    The charts above are only a few of the indicators Lance and Grant monitor that are now sending strong cautionary warnings about the near-term prospects for the financial markets and the underlying economy. What other key metrics should we also be tracing closely right now?

    To dig much deeper into this, Lance and Grant will be presenting their latest indicators, analysis and forecasts at the Dangerous Markets webinar on September 13th — where they will take ample questions live from the audience. For more information on the webinar, click here.

     

  • North Korea Claims It Has Developed Advanced Hydrogen Bomb, EMP

    A day after Russian President Vladimir warned that the US and North Korea are “balancing on the verge of a large-scale conflict," North Korean leader Kim Jong Un is doing everything in his power to validate Putin’s words.

    To wit, in a segment broadcasted Saturday by the Korean Central Broadcasting Network, the North’s state-run television-news network, the regime claimed that it has “succeeded in making a more developed” hydrogen bomb. In the broadcast, Kim can be seen looking on as a purported thermonuclear warhead is loaded onto an intercontinental ballistic missile, which KCNA described as having “great destructive powers." KCNA added that all hydrogen bomb components are homemade, so the North can "produce as many as it wants." The report also claimed that the North have developed a powerful electromagnetic pulse weapon.

    According to the Wall Street Journal, experts fear an attack with this type of weapon could wipe out electrical networks in the U.S.

    Here are more details from Dow Jones Newswires:

    • North Korea Says It Has ‘Succeeded in Making a More Developed’ Nuclear Weapon
    • Kim Jong Un Witnesses Hydrogen Bomb Being Loaded onto a ‘New ICBM’ —North Korea State Media
    • New Hydrogen Bomb’s Explosive Power Goes Up to Hundreds of Kilotons —North Korea State Media
    • North Korea Threatens ‘Super-Powerful’ EMP, or Electromagnetic Pulse, Attack
    • North Korea Claims All Hydrogen Bomb Components Are ‘Homemade,’ Can Produce ‘As Many As It Wants’

    Reuters explains that the hydrogen bomb's power is adjustable to hundreds of kilotons and can be detonated at high altitudes. Kim Jong Un "set forth tasks to be fulfilled in the research into nukes," KCNA said, but it made no mention of plans for a sixth nuclear test.

    As a reminder, in July, the North launched two ICBMs capable of reaching the US mainland, and after a monthlong break, Kim resumed his provocative missile tests last Friday by launching three short-range missiles into the Sea of Japan – and then on Monday, in another unprecedented provocation, the North fired an intermediate-range missile over the northern Japanese island of Hokkaido.

    Of course, there is no way of knowing whether the warhead is authentic, though we’re sure the intelligence community’s army of analysts will promptly opine one way or the other. Here’s Reuters with a more detailed account of the broadcast…

    “Kim visited the country’s Nuclear Weapons Institute and “watched an H-bomb to be loaded into new ICBM,” KCNA said. “All components of the H-bomb were homemade and all the processes … were put on the Juche basis, thus enabling the country to produce powerful nuclear weapons as many as it wants, he said.”

     

    Juche is North Korea’s homegrown ruling go-it-alone ideology that is a mix of Marxism and extreme nationalism preached by state founder Kim Il Sung, the current leader’s grandfather.

     

    Kim Jong Un “set forth tasks to be fulfilled in the research into nukes,” KCNA said, but it made no mention of plans for a sixth nuclear test.”

    Whether or not the claim of having an H-bomb is a fabrication, professional observers of the Kim regime warn that the report is a signal that the North Korean leader is preparing to carry out what would be the country's sixth nuclear test. North Korea last year conducted its fourth and fifth nuclear tests, claiming that the fourth in January 2016 was a successful hydrogen bomb test, though outside observers raised doubts about this claim. The North conducted a fifth nuclear test in September 2016, which was measured to be possibly North Korea’s biggest detonation ever, but the earthquake it caused was still not believed to be big enough to demonstrate a thermonuclear test, according to Reuters.

    And at least one observer who weighed in on Twitter said that the bomb appears to be authentic, which would confirm that the North is preparing for its most provocative action yet: its sixth nuclear test, which would force Trump to respond, having vowed never to allow North Korea to become a nuclear power with offensive capabilities.

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    Meanwhile, China and Russia have repeatedly urged the US and North Korea to engage in talks – even going so far as to offer a “roadmap” to de-escalation that would ask the North to halt progress on its missile program while the US and South Korea end military exercises.  As always, we await a response from President Donald Trump, who spent Saturday visiting disaster victims of Hurricane Harvey in Texas. As WSJ noted, the State Department has yet to comment.

  • Red Cross Admits It Doesn't Know How Hurricane Harvey Donation Money Is Spent

    Authored by Carey Wedler via TheAntiMedia.org,

    Though the Red Cross has a historical reputation for providing relief to victims of natural disasters and other emergencies, the organization’s practices have tarnished its name over the last few years.

    Amid the catastrophic earthquake in Haiti in 2010, the Red Cross reportedly accepted nearly $500 million in relief money but built only six homes with the funds even though they claimed they had provided homes to 130,000 people. These failures prompted some Haitians to advise the world against donating funds to the Red Cross.

    The organization was accused of diverting resources and supplies to bolster its public image during Hurricane Sandy. As an investigation by NPR and ProPublica found:

    The Red Cross national headquarters in Washington ‘diverted assets for public relations purposes.’  

     

    A former Red Cross official managing the Sandy effort says 40 percent of available trucks were assigned to serve as backdrops for news conferences.

    The outlets reported that [d]istribution of relief was ‘politically driven instead of [Red Cross] planned,’” noting many organizational failures.

    Further, a report released last year by Iowa Sen. Chuck Grassley found that 25% of funds donated to aid in relief for victims of the earthquake was actually spent on internal costs. That amounted to roughly $124 million.

    Now, amid the hurricane in Texas, the Red Cross is admitting it currently doesn’t know how the funds it’s receiving are being spent.

    NPR’s Morning Edition interviewed Red Cross executive Brad Kieserman to ask how the funds will be distributed.  Kieserman said that as of Wednesday morning, “had spent $50 million on Harvey relief, mainly on 232 shelters for 66,000 people.”

    Through donations, how much of every dollar goes to relief? NPR’s Ailsa Chang asked him.

    But he responded without actually providing an answer to her question:

    Yeah, I don’t think I know the answer to that any better than the chief fundraiser knows how many, how much it costs to put a volunteer downrange for a week and how many emergency response vehicles I have on the road today. So I think if he was on this interview and you were asking how many relief vehicles in Texas, I don’t think he’d know the answer and I don’t know the answer to the financial question I’m afraid.”

    She pressed him about the Red Cross’ previous failures and misallocation of resources. According to NPR’s transcript:

    Is that still happening? Such a substantial percentage of donations going to internal administrative costs, rather than to relief?

     

    “Kieserman: It’s not something I would have any visibility on. I can talk about what it costs to deliver certain relief services.

     

    “Chang: Yeah.

     

    “Kieserman: But the way the internal revenue stream works, uhh …

     

    “Chang: You don’t know what portion of that amount.

     

    “Kieserman: Not really.

     

    “Chang: You don’t know what portion of that total amount is for relief.

     

    “Kieserman: No, I really don’t. I wish I could answer your question, but it’s not something I have visibility on in the role that I play in this organization.

    The executive ultimately claimed that “The folks I work for are very, very attentive to cost effectiveness and cost efficiencies in making sure that as much as every dollar that we spend on an operation is client-facing.”

    Slate reporter Jonathan Katz also reported the organization declined to disclose how much money they had spent or raised so far. Katz ultimately urged readers not to contribute to the Red Cross.

    The Red Cross continues to face criticism and urgings for individuals who want to help to take their donations elsewhere. The Independent reports that over the weekend, Dan Gillmor, author and professor at Arizona State University’s Walter Cronkite School of Journalism, advised against donating to the Red Cross. Many other social media users have expressed similar sentiments.

    Despite the Red Cross’ failings, however, there are still many organizations doing important work.

    The group A Just Harvey Recovery lists a number of local efforts accepting contributions. The Cajun Navy, a volunteer effort that previously rescued victims of Hurricane Katrina and the Louisiana floods last year, has also been working round the clock in Texas and is accepting donationsThere are many organizations and shelters working locally to provide relief and essential services. If you would like to contribute or volunteer, you can find some of them herehere and here.

  • Are Grocery Chains About To Join The Retail-Bankruptcy Bloodbath?

    Amazon officially assumed control of Whole Foods Market on Monday and by noon, channel checks at WFM stores revealed that its new tech overlords had already slashed prices by nearly 50%, sending bonds of its grocery-chain rivals reeling as grocers confronted a new dilemma: either slash prices to the point of unprofitability, or hold the line and risk seeing sales evaporate.

    And as bonds of even highly rated grocery chains have underperformed this week, Bloomberg is questioning whether the WFM acquisition has fundamentally changed market dynamics in what was previously an island of stability in a retail sector beset by bankruptcies.

    Even before the WFM acquisition, the industry experienced the first signs of strain as Amazon launched its Amazon Fresh grocery service and Wal-Mart started stocking up on reasonably priced organics – factors that contributed to the massive drop in WFM’s market cap, allowing Amazon to scoop it up for less than $14 billion.

    Prior to this, the conventional wisdom dictated that grocers were impervious to the onslaught of e-commerce that was decimating industries such as clothing and electronics. Investors reasoned that consumers would probably balk at buying perishable goods like food online.

    But Amazon, with its seemingly infinite capacity to slash prices and brook losses, has created new risks for Whole Foods' rivals.

    Apollo Global thought buying North Carolina-based Fresh Market for the “every day low price” of $1.4 billion would be a turnaround slam dunk after its success with Sprouts Farmers Markets. One year later, the future profitability of that deal is in doubt, and that uncertainty is being reflected in the price.

    “The bonds that financed Apollo Global Management’s purchase last year of upscale grocer Fresh Market plunged to new lows this week. The cost of buying contracts to protect against a default in Albertsons Cos.’s debt has jumped. Bonds of Bi-Lo Holdings have lost almost half their value this year.”

     

    When Apollo Global bought Greensboro, North Carolina-based Fresh Market for $1.4 billion last year, the grocery world seemed quite different. The chain, known for its fresh produce, had seen sales slow. To lure customers back to Fresh Market’s roughly 170 stores, the private-equity titan was betting it could rely on its experience with previous – and profitable – investments in companies such as organic grocer Sprouts Farmers Markets.

     

    But Fresh Market is struggling for some of the same reasons that sent Whole Foods into the arms of Amazon. Mainstream competitors including Kroger Co. and Wal-Mart Stores Inc. have pushed deeper into sales of fresh produce and organic products. Supermarkets have opened so many stores that many analysts expect a shakeout. Before the Amazon deal, Fresh Market bonds traded as high as 91 cents on the dollar. Now they fetch less than 76 cents.”

    The reason is simple: Amazon, which is insulated not only by its e-commerce hegemony but also by investors who don’t expect the company to turn a profit. One analyst aptly referred to this as the Amazon-Whole Foods "fear factor.”

    “It’s the fear factor of Amazon,” said Mickey Chadha, an analyst at Moody’s Investors Service. “No retailer can under-price as long as Amazon can, make no money and get away with it. That’s why people are scared.”

    * * *

    News of the Amazon deal obliterated billions of dollars of grocers’ valuations, slicing $2 billion off Kroger’s market cap in one day. The grocer’s stock is down 35% this year. Yet its bonds have held steady.

    Meanwhile, nearly $3 billion in Albertsons bonds due in 2021 have tumbled..

    “Kroger’s bonds, which are investment grade, haven’t been hit. But about $3 billion of Albertsons debt coming due in 2021 has felt a chill. The loans have been trading at 97.6 cents on the dollar. Large, liquid, secured loans of that size typically command par, or 100 cents. A public stock offering for the Cerberus Capital Management-backed grocer was again put on hold after Amazon announced its purchase of Whole Foods.”

    …causing the cost of insuring them to skyrocket.

    As one might expect, analysts now believe that large chains with relatively low debt burdens will somehow manage to survive.

    But smaller chains like Bi-Lo Holdings may soon find that their debt burdens are untenable:

    “For example, Bi-Lo Holdings has borrowed hundreds of millions to make cash payouts to private-equity owner Lone Star Global Acquisitions. One of the bonds the company sold to pay the dividends now trades at levels indicating investors expect to recoup only a third of what they loaned the company.”

    Tops Friendly Markets, another troubled grocer, is being choked by its $720 million debt pile.

    “Tops Friendly Markets, which is reporting millions in losses, is straining under $720 million in debt. Using a maneuver typical of distressed companies, it put off repayments due in 2018 while it grapples with price deflation and traditional rivals in its western New York home turf. If earnings and the balance sheet don’t improve, investors holding the rest of Tops’ bonds could find they’re stuck with spoiled goods.”

    However, there's at least one factor that may insulate the market's weaker hands, at least for a little while. There are 40,000 grocery stores in the US, only 400 of which are WFMs…

    So, should investors be bracing for a wave of grocery bankruptcies resembling this year’s record run of failures among department stores, apparel sellers and electronics retailers? Maybe not right away. But once Amazon's had a few years to expand its footprint, a massive shakeout seems inevitable.
     

  • Facebook Exposed – "You" Are The Product

    Authored by John Lanchester via The London Review of Books,

    At the end of June, Mark Zuckerberg announced that Facebook had hit a new level: two billion monthly active users. That number, the company’s preferred ‘metric’ when measuring its own size, means two billion different people used Facebook in the preceding month. It is hard to grasp just how extraordinary that is. Bear in mind that thefacebook – its original name – was launched exclusively for Harvard students in 2004. No human enterprise, no new technology or utility or service, has ever been adopted so widely so quickly. The speed of uptake far exceeds that of the internet itself, let alone ancient technologies such as television or cinema or radio.

    Also amazing: as Facebook has grown, its users’ reliance on it has also grown. The increase in numbers is not, as one might expect, accompanied by a lower level of engagement. More does not mean worse – or worse, at least, from Facebook’s point of view. On the contrary. In the far distant days of October 2012, when Facebook hit one billion users, 55 per cent of them were using it every day. At two billion, 66 per cent are. Its user base is growing at 18 per cent a year – which you’d have thought impossible for a business already so enormous. Facebook’s biggest rival for logged-in users is YouTube, owned by its deadly rival Alphabet (the company formerly known as Google), in second place with 1.5 billion monthly users. Three of the next four biggest apps, or services, or whatever one wants to call them, are WhatsApp, Messenger and Instagram, with 1.2 billion, 1.2 billion, and 700 million users respectively (the Chinese app WeChat is the other one, with 889 million). Those three entities have something in common: they are all owned by Facebook. No wonder the company is the fifth most valuable in the world, with a market capitalisation of $445 billion.

    Zuckerberg’s news about Facebook’s size came with an announcement which may or may not prove to be significant. He said that the company was changing its ‘mission statement’, its version of the canting pieties beloved of corporate America. Facebook’s mission used to be ‘making the world more open and connected’. A non-Facebooker reading that is likely to ask: why? Connection is presented as an end in itself, an inherently and automatically good thing. Is it, though? Flaubert was sceptical about trains because he thought (in Julian Barnes’s paraphrase) that ‘the railway would merely permit more people to move about, meet and be stupid.’ You don’t have to be as misanthropic as Flaubert to wonder if something similar isn’t true about connecting people on Facebook. For instance, Facebook is generally agreed to have played a big, perhaps even a crucial, role in the election of Donald Trump. The benefit to humanity is not clear. This thought, or something like it, seems to have occurred to Zuckerberg, because the new mission statement spells out a reason for all this connectedness. It says that the new mission is to ‘give people the power to build community and bring the world closer together’.

    Hmm. Alphabet’s mission statement, ‘to organise the world’s information and make it universally accessible and useful’, came accompanied by the maxim ‘Don’t be evil,’ which has been the source of a lot of ridicule: Steve Jobs called it ‘bullshit’. Which it is, but it isn’t only bullshit. Plenty of companies, indeed entire industries, base their business model on being evil. The insurance business, for instance, depends on the fact that insurers charge customers more than their insurance is worth; that’s fair enough, since if they didn’t do that they wouldn’t be viable as businesses. What isn’t fair is the panoply of cynical techniques that many insurers use to avoid, as far as possible, paying out when the insured-against event happens. Just ask anyone who has had a property suffer a major mishap. It’s worth saying ‘Don’t be evil,’ because lots of businesses are. This is especially an issue in the world of the internet. Internet companies are working in a field that is poorly understood (if understood at all) by customers and regulators. The stuff they’re doing, if they’re any good at all, is by definition new. In that overlapping area of novelty and ignorance and unregulation, it’s well worth reminding employees not to be evil, because if the company succeeds and grows, plenty of chances to be evil are going to come along.

    Google and Facebook have both been walking this line from the beginning. Their styles of doing so are different. An internet entrepreneur I know has had dealings with both companies. ‘YouTube knows they have lots of dirty things going on and are keen to try and do some good to alleviate it,’ he told me. I asked what he meant by ‘dirty’. ‘Terrorist and extremist content, stolen content, copyright violations. That kind of thing. But Google in my experience knows that there are ambiguities, moral doubts, around some of what they do, and at least they try to think about it. Facebook just doesn’t care. When you’re in a room with them you can tell. They’re’ – he took a moment to find the right word – ‘scuzzy’.

    That might sound harsh. There have, however, been ethical problems and ambiguities about Facebook since the moment of its creation, a fact we know because its creator was live-blogging at the time. The scene is as it was recounted in Aaron Sorkin’s movie about the birth of Facebook, The Social Network. While in his first year at Harvard, Zuckerberg suffered a romantic rebuff. Who wouldn’t respond to this by creating a website where undergraduates’ pictures are placed side by side so that users of the site can vote for the one they find more attractive? (The film makes it look as if it was only female undergraduates: in real life it was both.) The site was called Facemash. In the great man’s own words, at the time:

    I’m a little intoxicated, I’m not gonna lie. So what if it’s not even 10 p.m. and it’s a Tuesday night? What? The Kirkland dormitory facebook is open on my desktop and some of these people have pretty horrendous facebook pics. I almost want to put some of these faces next to pictures of some farm animals and have people vote on which is the more attractive … Let the hacking begin.

    As Tim Wu explains in his energetic and original new book The Attention Merchants, a ‘facebook’ in the sense Zuckerberg uses it here ‘traditionally referred to a physical booklet produced at American universities to promote socialisation in the way that “Hi, My Name Is” stickers do at events; the pages consisted of rows upon rows of head shots with the corresponding name’. Harvard was already working on an electronic version of its various dormitory facebooks. The leading social network, Friendster, already had three million users. The idea of putting these two things together was not entirely novel, but as Zuckerberg said at the time, ‘I think it’s kind of silly that it would take the University a couple of years to get around to it. I can do it better than they can, and I can do it in a week.’

    Wu argues that capturing and reselling attention has been the basic model for a large number of modern businesses, from posters in late 19th-century Paris, through the invention of mass-market newspapers that made their money not through circulation but through ad sales, to the modern industries of advertising and ad-funded TV. Facebook is in a long line of such enterprises, though it might be the purest ever example of a company whose business is the capture and sale of attention. Very little new thinking was involved in its creation. As Wu observes, Facebook is ‘a business with an exceedingly low ratio of invention to success’. What Zuckerberg had instead of originality was the ability to get things done and to see the big issues clearly. The crucial thing with internet start-ups is the ability to execute plans and to adapt to changing circumstances. It’s Zuck’s skill at doing that – at hiring talented engineers, and at navigating the big-picture trends in his industry – that has taken his company to where it is today. Those two huge sister companies under Facebook’s giant wing, Instagram and WhatsApp, were bought for $1 billion and $19 billion respectively, at a point when they had no revenue. No banker or analyst or sage could have told Zuckerberg what those acquisitions were worth; nobody knew better than he did. He could see where things were going and help make them go there. That talent turned out to be worth several hundred billion dollars.

    Jesse Eisenberg’s brilliant portrait of Zuckerberg in The Social Network is misleading, as Antonio García Martínez, a former Facebook manager, argues in Chaos Monkeys, his entertainingly caustic book about his time at the company. The movie Zuckerberg is a highly credible character, a computer genius located somewhere on the autistic spectrum with minimal to non-existent social skills. But that’s not what the man is really like. In real life, Zuckerberg was studying for a degree with a double concentration in computer science and – this is the part people tend to forget – psychology. People on the spectrum have a limited sense of how other people’s minds work; autists, it has been said, lack a ‘theory of mind’. Zuckerberg, not so much. He is very well aware of how people’s minds work and in particular of the social dynamics of popularity and status. The initial launch of Facebook was limited to people with a Harvard email address; the intention was to make access to the site seem exclusive and aspirational. (And also to control site traffic so that the servers never went down. Psychology and computer science, hand in hand.) Then it was extended to other elite campuses in the US. When it launched in the UK, it was limited to Oxbridge and the LSE. The idea was that people wanted to look at what other people like them were doing, to see their social networks, to compare, to boast and show off, to give full rein to every moment of longing and envy, to keep their noses pressed against the sweet-shop window of others’ lives.

    This focus attracted the attention of Facebook’s first external investor, the now notorious Silicon Valley billionaire Peter Thiel. Again, The Social Network gets it right: Thiel’s $500,000 investment in 2004 was crucial to the success of the company. But there was a particular reason Facebook caught Thiel’s eye, rooted in a byway of intellectual history. In the course of his studies at Stanford – he majored in philosophy – Thiel became interested in the ideas of the US-based French philosopher René Girard, as advocated in his most influential book, Things Hidden since the Foundation of the World. Girard’s big idea was something he called ‘mimetic desire’. Human beings are born with a need for food and shelter. Once these fundamental necessities of life have been acquired, we look around us at what other people are doing, and wanting, and we copy them. In Thiel’s summary, the idea is ‘that imitation is at the root of all behaviour’.

    Girard was a Christian, and his view of human nature is that it is fallen. We don’t know what we want or who we are; we don’t really have values and beliefs of our own; what we have instead is an instinct to copy and compare. We are homo mimeticus. ‘Man is the creature who does not know what to desire, and who turns to others in order to make up his mind. We desire what others desire because we imitate their desires.’ Look around, ye petty, and compare. The reason Thiel latched onto Facebook with such alacrity was that he saw in it for the first time a business that was Girardian to its core: built on people’s deep need to copy. ‘Facebook first spread by word of mouth, and it’s about word of mouth, so it’s doubly mimetic,’ Thiel said. ‘Social media proved to be more important than it looked, because it’s about our natures.’ We are keen to be seen as we want to be seen, and Facebook is the most popular tool humanity has ever had with which to do that.

    *  *  *

    The view of human nature implied by these ideas is pretty dark. If all people want to do is go and look at other people so that they can compare themselves to them and copy what they want – if that is the final, deepest truth about humanity and its motivations – then Facebook doesn’t really have to take too much trouble over humanity’s welfare, since all the bad things that happen to us are things we are doing to ourselves. For all the corporate uplift of its mission statement, Facebook is a company whose essential premise is misanthropic. It is perhaps for that reason that Facebook, more than any other company of its size, has a thread of malignity running through its story. The high-profile, tabloid version of this has come in the form of incidents such as the live-streaming of rapes, suicides, murders and cop-killings. But this is one of the areas where Facebook seems to me relatively blameless. People live-stream these terrible things over the site because it has the biggest audience; if Snapchat or Periscope were bigger, they’d be doing it there instead.

    In many other areas, however, the site is far from blameless. The highest-profile recent criticisms of the company stem from its role in Trump’s election. There are two components to this, one of them implicit in the nature of the site, which has an inherent tendency to fragment and atomise its users into like-minded groups. The mission to ‘connect’ turns out to mean, in practice, connect with people who agree with you. We can’t prove just how dangerous these ‘filter bubbles’ are to our societies, but it seems clear that they are having a severe impact on our increasingly fragmented polity. Our conception of ‘we’ is becoming narrower.

    This fragmentation created the conditions for the second strand of Facebook’s culpability in the Anglo-American political disasters of the last year. The portmanteau terms for these developments are ‘fake news’ and ‘post-truth’, and they were made possible by the retreat from a general agora of public debate into separate ideological bunkers. In the open air, fake news can be debated and exposed; on Facebook, if you aren’t a member of the community being served the lies, you’re quite likely never to know that they are in circulation. It’s crucial to this that Facebook has no financial interest in telling the truth. No company better exemplifies the internet-age dictum that if the product is free, you are the product. Facebook’s customers aren’t the people who are on the site: its customers are the advertisers who use its network and who relish its ability to direct ads to receptive audiences. Why would Facebook care if the news streaming over the site is fake? Its interest is in the targeting, not in the content. This is probably one reason for the change in the company’s mission statement. If your only interest is in connecting people, why would you care about falsehoods? They might even be better than the truth, since they are quicker to identify the like-minded. The newfound ambition to ‘build communities’ makes it seem as if the company is taking more of an interest in the consequence of the connections it fosters.

    Fake news is not, as Facebook has acknowledged, the only way it was used to influence the outcome of the 2016 presidential election. On 6 January 2017 the director of national intelligence published a report saying that the Russians had waged an internet disinformation campaign to damage Hillary Clinton and help Trump. ‘Moscow’s influence campaign followed a Russian messaging strategy that blends covert intelligence operations – such as cyber-activity – with overt efforts by Russian government agencies, state-funded media, third-party intermediaries, and paid social media users or “trolls”,’ the report said. At the end of April, Facebook got around to admitting this (by then) fairly obvious truth, in an interesting paper published by its internal security division. ‘Fake news’, they argue, is an unhelpful, catch-all term because misinformation is in fact spread in a variety of ways:

    Information (or Influence) Operations – Actions taken by governments or organised non-state actors to distort domestic or foreign political sentiment.

     

    False News – News articles that purport to be factual, but which contain intentional misstatements of fact with the intention to arouse passions, attract viewership, or deceive.

     

    False Amplifiers – Co-ordinated activity by inauthentic accounts with the intent of manipulating political discussion (e.g. by discouraging specific parties from participating in discussion, or amplifying sensationalistic voices over others).

     

    Disinformation – Inaccurate or manipulated information/content that is spread intentionally. This can include false news, or it can involve more subtle methods, such as false flag operations, feeding inaccurate quotes or stories to innocent intermediaries, or knowingly amplifying biased or misleading information.

    The company is promising to treat this problem or set of problems as seriously as it treats such other problems as malware, account hacking and spam. We’ll see. One man’s fake news is another’s truth-telling, and Facebook works hard at avoiding responsibility for the content on its site – except for sexual content, about which it is super-stringent. Nary a nipple on show. It’s a bizarre set of priorities, which only makes sense in an American context, where any whiff of explicit sexuality would immediately give the site a reputation for unwholesomeness. Photos of breastfeeding women are banned and rapidly get taken down. Lies and propaganda are fine.

    The key to understanding this is to think about what advertisers want: they don’t want to appear next to pictures of breasts because it might damage their brands, but they don’t mind appearing alongside lies because the lies might be helping them find the consumers they’re trying to target. In Move Fast and Break Things, his polemic against the ‘digital-age robber barons’, Jonathan Taplin points to an analysis on Buzzfeed: ‘In the final three months of the US presidential campaign, the top-performing fake election news stories on Facebook generated more engagement than the top stories from major news outlets such as the New York Times, Washington Post, Huffington Post, NBC News and others.’ This doesn’t sound like a problem Facebook will be in any hurry to fix.

    The fact is that fraudulent content, and stolen content, are rife on Facebook, and the company doesn’t really mind, because it isn’t in its interest to mind. Much of the video content on the site is stolen from the people who created it. An illuminating YouTube video from Kurzgesagt, a German outfit that makes high-quality short explanatory films, notes that in 2015, 725 of Facebook’s top one thousand most viewed videos were stolen. This is another area where Facebook’s interests contradict society’s. We may collectively have an interest in sustaining creative and imaginative work in many different forms and on many platforms. Facebook doesn’t. It has two priorities, as Martínez explains in Chaos Monkeys: growth and monetisation. It simply doesn’t care where the content comes from. It is only now starting to care about the perception that much of the content is fraudulent, because if that perception were to become general, it might affect the amount of trust and therefore the amount of time people give to the site.

    Zuckerberg himself has spoken up on this issue, in a Facebook post addressing the question of ‘Facebook and the election’. After a certain amount of boilerplate bullshit (‘Our goal is to give every person a voice. We believe deeply in people’), he gets to the nub of it. ‘Of all the content on Facebook, more than 99 per cent of what people see is authentic. Only a very small amount is fake news and hoaxes.’ More than one Facebook user pointed out that in their own news feed, Zuckerberg’s post about authenticity ran next to fake news. In one case, the fake story pretended to be from the TV sports channel ESPN. When it was clicked on, it took users to an ad selling a diet supplement. As the writer Doc Searls pointed out, it’s a double fraud, ‘outright lies from a forged source’, which is quite something to have right slap next to the head of Facebook boasting about the absence of fraud. Evan Williams, co-founder of Twitter and founder of the long-read specialist Medium, found the same post by Zuckerberg next to a different fake ESPN story and another piece of fake news purporting to be from CNN, announcing that Congress had disqualified Trump from office. When clicked-through, that turned out to be from a company offering a 12-week programme to strengthen toes. (That’s right: strengthen toes.) Still, we now know that Zuck believes in people. That’s the main thing.

    *  *  *

    A neutral observer might wonder if Facebook’s attitude to content creators is sustainable. Facebook needs content, obviously, because that’s what the site consists of: content that other people have created. It’s just that it isn’t too keen on anyone apart from Facebook making any money from that content. Over time, that attitude is profoundly destructive to the creative and media industries. Access to an audience – that unprecedented two billion people – is a wonderful thing, but Facebook isn’t in any hurry to help you make money from it. If the content providers all eventually go broke, well, that might not be too much of a problem. There are, for now, lots of willing providers: anyone on Facebook is in a sense working for Facebook, adding value to the company. In 2014, the New York Times did the arithmetic and found that humanity was spending 39,757 collective years on the site, every single day. Jonathan Taplin points out that this is ‘almost fifteen million years of free labour per year’. That was back when it had a mere 1.23 billion users.

    Taplin has worked in academia and in the film industry. The reason he feels so strongly about these questions is that he started out in the music business, as manager of The Band, and was on hand to watch the business being destroyed by the internet. What had been a $20 billion industry in 1999 was a $7 billion industry 15 years later. He saw musicians who had made a good living become destitute. That didn’t happen because people had stopped listening to their music – more people than ever were listening to it – but because music had become something people expected to be free. YouTube is the biggest source of music in the world, playing billions of tracks annually, but in 2015 musicians earned less from it and from its ad-supported rivals than they earned from sales of vinyl. Not CDs and recordings in general: vinyl.

    Something similar has happened in the world of journalism. Facebook is in essence an advertising company which is indifferent to the content on its site except insofar as it helps to target and sell advertisements. A version of Gresham’s law is at work, in which fake news, which gets more clicks and is free to produce, drives out real news, which often tells people things they don’t want to hear, and is expensive to produce. In addition, Facebook uses an extensive set of tricks to increase its traffic and the revenue it makes from targeting ads, at the expense of the news-making institutions whose content it hosts. Its news feed directs traffic at you based not on your interests, but on how to make the maximum amount of advertising revenue from you. In September 2016, Alan Rusbridger, the former editor of the Guardian, told a Financial Times conference that Facebook had ‘sucked up $27 million’ of the newspaper’s projected ad revenue that year. ‘They are taking all the money because they have algorithms we don’t understand, which are a filter between what we do and how people receive it.’

    This goes to the heart of the question of what Facebook is and what it does. For all the talk about connecting people, building community, and believing in people, Facebook is an advertising company. Martínez gives the clearest account both of how it ended up like that, and how Facebook advertising works. In the early years of Facebook, Zuckerberg was much more interested in the growth side of the company than in the monetisation. That changed when Facebook went in search of its big payday at the initial public offering, the shining day when shares in a business first go on sale to the general public. This is a huge turning-point for any start-up: in the case of many tech industry workers, the hope and expectation associated with ‘going public’ is what attracted them to their firm in the first place, and/or what has kept them glued to their workstations. It’s the point where the notional money of an early-days business turns into the real cash of a public company.

    Martínez was there at the very moment when Zuck got everyone together to tell them they were going public, the moment when all Facebook employees knew that they were about to become rich:

    I had chosen a seat behind a detached pair, who on further inspection turned out to be Chris Cox, head of FB product, and Naomi Gleit, a Harvard grad who joined as employee number 29, and was now reputed to be the current longest-serving employee other than Mark.

     

    Naomi, between chats with Cox, was clicking away on her laptop, paying little attention to the Zuckian harangue. I peered over her shoulder at her screen. She was scrolling down an email with a number of links, and progressively clicking each one into existence as another tab on her browser. Clickathon finished, she began lingering on each with an appraiser’s eye. They were real estate listings, each for a different San Francisco property.

    Martínez took note of one of the properties and looked it up later. Price: $2.4 million. He is fascinating, and fascinatingly bitter, on the subject of class and status differences in Silicon Valley, in particular the never publicly discussed issue of the huge gulf between early employees in a company, who have often been made unfathomably rich, and the wage slaves who join the firm later in its story. ‘The protocol is not to talk about it at all publicly.’ But, as Bonnie Brown, a masseuse at Google in the early days, wrote in her memoir, ‘a sharp contrast developed between Googlers working side by side. While one was looking at local movie times on their monitor, the other was booking a flight to Belize for the weekend. How was the conversation on Monday morning going to sound now?’

    When the time came for the IPO, Facebook needed to turn from a company with amazing growth to one that was making amazing money. It was already making some, thanks to its sheer size – as Martínez observes, ‘a billion times any number is still a big fucking number’ – but not enough to guarantee a truly spectacular valuation on launch. It was at this stage that the question of how to monetise Facebook got Zuckerberg’s full attention. It’s interesting, and to his credit, that he hadn’t put too much focus on it before – perhaps because he isn’t particularly interested in money per se. But he does like to win.

    The solution was to take the huge amount of information Facebook has about its ‘community’ and use it to let advertisers target ads with a specificity never known before, in any medium. Martínez: ‘It can be demographic in nature (e.g. 30-to-40-year-old females), geographic (people within five miles of Sarasota, Florida), or even based on Facebook profile data (do you have children; i.e. are you in the mommy segment?).’ Taplin makes the same point:

    If I want to reach women between the ages of 25 and 30 in zip code 37206 who like country music and drink bourbon, Facebook can do that. Moreover, Facebook can often get friends of these women to post a ‘sponsored story’ on a targeted consumer’s news feed, so it doesn’t feel like an ad. As Zuckerberg said when he introduced Facebook Ads, ‘Nothing influences people more than a recommendation from a trusted friend. A trusted referral is the Holy Grail of advertising.’

    That was the first part of the monetisation process for Facebook, when it turned its gigantic scale into a machine for making money. The company offered advertisers an unprecedentedly precise tool for targeting their ads at particular consumers. (Particular segments of voters too can be targeted with complete precision. One instance from 2016 was an anti-Clinton ad repeating a notorious speech she made in 1996 on the subject of ‘super-predators’. The ad was sent to African-American voters in areas where the Republicans were trying, successfully as it turned out, to suppress the Democrat vote. Nobody else saw the ads.)

    The second big shift around monetisation came in 2012 when internet traffic began to switch away from desktop computers towards mobile devices. If you do most of your online reading on a desktop, you are in a minority. The switch was a potential disaster for all businesses which relied on internet advertising, because people don’t much like mobile ads, and were far less likely to click on them than on desktop ads. In other words, although general internet traffic was increasing rapidly, because the growth was coming from mobile, the traffic was becoming proportionately less valuable. If the trend were to continue, every internet business that depended on people clicking links – i.e. pretty much all of them, but especially the giants like Google and Facebook – would be worth much less money.

    Facebook solved the problem by means of a technique called ‘onboarding’. As Martínez explains it, the best way to think about this is to consider our various kinds of name and address.

    For example, if Bed, Bath and Beyond wants to get my attention with one of its wonderful 20 per cent off coupons, it calls out:

     

    Antonio García Martínez
    1 Clarence Place #13
    San Francisco, CA 94107

     

    If it wants to reach me on my mobile device, my name there is:38400000-8cfo-11bd-b23e-10b96e40000d

     

    That’s my quasi-immutable device ID, broadcast hundreds of times a day on mobile ad exchanges.

     

    On my laptop, my name is this: 07J6yJPMB9juTowar.AWXGQnGPA1MCmThgb9wN4vLoUpg.BUUtWg.rg.FTN.0.AWUxZtUf

     

    This is the content of the Facebook re-targeting cookie, which is used to target ads-are-you based on your mobile browsing.

     

    Though it may not be obvious, each of these keys is associated with a wealth of our personal behaviour data: every website we’ve been to, many things we’ve bought in physical stores, and every app we’ve used and what we did there … The biggest thing going on in marketing right now, what is generating tens of billions of dollars in investment and endless scheming inside the bowels of Facebook, Google, Amazon and Apple, is how to tie these different sets of names together, and who controls the links. That’s it.

    Facebook already had a huge amount of information about people and their social networks and their professed likes and dislikes. After waking up to the importance of monetisation, they added to their own data a huge new store of data about offline, real-world behaviour, acquired through partnerships with big companies such as Experian, which have been monitoring consumer purchases for decades via their relationships with direct marketing firms, credit card companies, and retailers. There doesn’t seem to be a one-word description of these firms: ‘consumer credit agencies’ or something similar about sums it up. Their reach is much broader than that makes it sound, though Experian says its data is based on more than 850 million records and claims to have information on 49.7 million UK adults living in 25.2 million households in 1.73 million postcodes. These firms know all there is to know about your name and address, your income and level of education, your relationship status, plus everywhere you’ve ever paid for anything with a card. Facebook could now put your identity together with the unique device identifier on your phone.

    That was crucial to Facebook’s new profitability. On mobiles, people tend to prefer the internet to apps, which corral the information they gather and don’t share it with other companies. A game app on your phone is unlikely to know anything about you except the level you’ve got to on that particular game. But because everyone in the world is on Facebook, the company knows everyone’s phone identifier. It was now able to set up an ad server delivering far better targeted mobile ads than anyone else could manage, and it did so in a more elegant and well-integrated form than anyone else had managed.

    So Facebook knows your phone ID and can add it to your Facebook ID. It puts that together with the rest of your online activity: not just every site you’ve ever visited, but every click you’ve ever made – the Facebook button tracks every Facebook user, whether they click on it or not. Since the Facebook button is pretty much ubiquitous on the net, this means that Facebook sees you, everywhere. Now, thanks to its partnerships with the old-school credit firms, Facebook knew who everybody was, where they lived, and everything they’d ever bought with plastic in a real-world offline shop. All this information is used for a purpose which is, in the final analysis, profoundly bathetic. It is to sell you things via online ads.

    The ads work on two models. In one of them, advertisers ask Facebook to target consumers from a particular demographic – our thirty-something bourbon-drinking country music fan, or our African American in Philadelphia who was lukewarm about Hillary. But Facebook also delivers ads via a process of online auctions, which happen in real time whenever you click on a website. Because every website you’ve ever visited (more or less) has planted a cookie on your web browser, when you go to a new site, there is a real-time auction, in millionths of a second, to decide what your eyeballs are worth and what ads should be served to them, based on what your interests, and income level and whatnot, are known to be. This is the reason ads have that disconcerting tendency to follow you around, so that you look at a new telly or a pair of shoes or a holiday destination, and they’re still turning up on every site you visit weeks later. This was how, by chucking talent and resources at the problem, Facebook was able to turn mobile from a potential revenue disaster to a great hot steamy geyser of profit.

    What this means is that even more than it is in the advertising business, Facebook is in the surveillance business. Facebook, in fact, is the biggest surveillance-based enterprise in the history of mankind. It knows far, far more about you than the most intrusive government has ever known about its citizens. It’s amazing that people haven’t really understood this about the company. I’ve spent time thinking about Facebook, and the thing I keep coming back to is that its users don’t realise what it is the company does. What Facebook does is watch you, and then use what it knows about you and your behaviour to sell ads. I’m not sure there has ever been a more complete disconnect between what a company says it does – ‘connect’, ‘build communities’ – and the commercial reality. Note that the company’s knowledge about its users isn’t used merely to target ads but to shape the flow of news to them. Since there is so much content posted on the site, the algorithms used to filter and direct that content are the thing that determines what you see: people think their news feed is largely to do with their friends and interests, and it sort of is, with the crucial proviso that it is their friends and interests as mediated by the commercial interests of Facebook. Your eyes are directed towards the place where they are most valuable for Facebook.

    *  *  *

    I’m left wondering what will happen when and if this $450 billion penny drops. Wu’s history of attention merchants shows that there is a suggestive pattern here: that a boom is more often than not followed by a backlash, that a period of explosive growth triggers a public and sometimes legislative reaction. Wu’s first example is the draconian anti-poster laws introduced in early 20th-century Paris (and still in force – one reason the city is by contemporary standards undisfigured by ads). As Wu says, ‘when the commodity in question is access to people’s minds, the perpetual quest for growth ensures that forms of backlash, both major and minor, are all but inevitable.’ Wu calls a minor form of this phenomenon the ‘disenchantment effect’.

    Facebook seems vulnerable to these disenchantment effects. One place they are likely to begin is in the core area of its business model – ad-selling. The advertising it sells is ‘programmatic’, i.e. determined by computer algorithms that match the customer to the advertiser and deliver ads accordingly, via targeting and/or online auctions. The problem with this from the customer’s point of view – remember, the customer here is the advertiser, not the Facebook user – is that a lot of the clicks on these ads are fake. There is a mismatch of interests here. Facebook wants clicks, because that’s how it gets paid: when ads are clicked on. But what if the clicks aren’t real but are instead automated clicks from fake accounts run by computer bots? This is a well-known problem, which particularly affects Google, because it’s easy to set up a site, allow it to host programmatic ads, then set up a bot to click on those ads, and collect the money that comes rolling in. On Facebook the fraudulent clicks are more likely to be from competitors trying to drive each others’ costs up.

    The industry publication Ad Week estimates the annual cost of click fraud at $7 billion, about a sixth of the entire market. One single fraud site, Methbot, whose existence was exposed at the end of last year, uses a network of hacked computers to generate between three and five million dollars’ worth of fraudulent clicks every day. Estimates of fraudulent traffic’s market share are variable, with some guesses coming in at around 50 per cent; some website owners say their own data indicates a fraudulent-click rate of 90 per cent. This is by no means entirely Facebook’s problem, but it isn’t hard to imagine how it could lead to a big revolt against ‘ad tech’, as this technology is generally known, on the part of the companies who are paying for it. I’ve heard academics in the field say that there is a form of corporate groupthink in the world of the big buyers of advertising, who are currently responsible for directing large parts of their budgets towards Facebook. That mindset could change. Also, many of Facebook’s metrics are tilted to catch the light at the angle which makes them look shiniest. A video is counted as ‘viewed’ on Facebook if it runs for three seconds, even if the user is scrolling past it in her news feed and even if the sound is off. Many Facebook videos with hundreds of thousands of ‘views’, if counted by the techniques that are used to count television audiences, would have no viewers at all.

    A customers’ revolt could overlap with a backlash from regulators and governments. Google and Facebook have what amounts to a monopoly on digital advertising. That monopoly power is becoming more and more important as advertising spend migrates online. Between them, they have already destroyed large sections of the newspaper industry. Facebook has done a huge amount to lower the quality of public debate and to ensure that it is easier than ever before to tell what Hitler approvingly called ‘big lies’ and broadcast them to a big audience. The company has no business need to care about that, but it is the kind of issue that could attract the attention of regulators.

    That isn’t the only external threat to the Google/Facebook duopoly. The US attitude to anti-trust law was shaped by Robert Bork, the judge whom Reagan nominated for the Supreme Court but the Senate failed to confirm. Bork’s most influential legal stance came in the area of competition law. He promulgated the doctrine that the only form of anti-competitive action which matters concerns the prices paid by consumers. His idea was that if the price is falling that means the market is working, and no questions of monopoly need be addressed. This philosophy still shapes regulatory attitudes in the US and it’s the reason Amazon, for instance, has been left alone by regulators despite the manifestly monopolistic position it holds in the world of online retail, books especially.

    The big internet enterprises seem invulnerable on these narrow grounds. Or they do until you consider the question of individualised pricing. The huge data trail we all leave behind as we move around the internet is increasingly used to target us with prices which aren’t like the tags attached to goods in a shop. On the contrary, they are dynamic, moving with our perceived ability to pay. Four researchers based in Spain studied the phenomenon by creating automated personas to behave as if, in one case, ‘budget conscious’ and in another ‘affluent’, and then checking to see if their different behaviour led to different prices. It did: a search for headphones returned a set of results which were on average four times more expensive for the affluent persona. An airline-ticket discount site charged higher fares to the affluent consumer. In general, the location of the searcher caused prices to vary by as much as 166 per cent. So in short, yes, personalised prices are a thing, and the ability to create them depends on tracking us across the internet. That seems to me a prima facie violation of the American post-Bork monopoly laws, focused as they are entirely on price. It’s sort of funny, and also sort of grotesque, that an unprecedentedly huge apparatus of consumer surveillance is fine, apparently, but an unprecedentedly huge apparatus of consumer surveillance which results in some people paying higher prices may well be illegal.

    Perhaps the biggest potential threat to Facebook is that its users might go off it. Two billion monthly active users is a lot of people, and the ‘network effects’ – the scale of the connectivity – are, obviously, extraordinary. But there are other internet companies which connect people on the same scale – Snapchat has 166 million daily users, Twitter 328 million monthly users – and as we’ve seen in the disappearance of Myspace, the onetime leader in social media, when people change their minds about a service, they can go off it hard and fast.

    For that reason, were it to be generally understood that Facebook’s business model is based on surveillance, the company would be in danger. The one time Facebook did poll its users about the surveillance model was in 2011, when it proposed a change to its terms and conditions – the change that underpins the current template for its use of data. The result of the poll was clear: 90 per cent of the vote was against the changes. Facebook went ahead and made them anyway, on the grounds that so few people had voted. No surprise there, neither in the users’ distaste for surveillance nor in the company’s indifference to that distaste. But this is something which could change.

    The other thing that could happen at the level of individual users is that people stop using Facebook because it makes them unhappy. This isn’t the same issue as the scandal in 2014 when it turned out that social scientists at the company had deliberately manipulated some people’s news feeds to see what effect, if any, it had on their emotions. The resulting paper, published in the Proceedings of the National Academy of Sciences, was a study of ‘social contagion’, or the transfer of emotion among groups of people, as a result of a change in the nature of the stories seen by 689,003 users of Facebook. ‘When positive expressions were reduced, people produced fewer positive posts and more negative posts; when negative expressions were reduced, the opposite pattern occurred. These results indicate that emotions expressed by others on Facebook influence our own emotions, constituting experimental evidence for massive-scale contagion via social networks.’ The scientists seem not to have considered how this information would be received, and the story played quite big for a while.

    Perhaps the fact that people already knew this story accidentally deflected attention from what should have been a bigger scandal, exposed earlier this year in a paper from the American Journal of Epidemiology. The paper was titled ‘Association of Facebook Use with Compromised Well-Being: A Longitudinal Study’. The researchers found quite simply that the more people use Facebook, the more unhappy they are. A 1 per cent increase in ‘likes’ and clicks and status updates was correlated with a 5 to 8 per cent decrease in mental health. In addition, they found that the positive effect of real-world interactions, which enhance well-being, was accurately paralleled by the ‘negative associations of Facebook use’. In effect people were swapping real relationships which made them feel good for time on Facebook which made them feel bad. That’s my gloss rather than that of the scientists, who take the trouble to make it clear that this is a correlation rather than a definite causal relationship, but they did go so far – unusually far – as to say that the data ‘suggests a possible trade-off between offline and online relationships’. This isn’t the first time something like this effect has been found. To sum up: there is a lot of research showing that Facebook makes people feel like shit. So maybe, one day, people will stop using it.?

    *  *  *

    What, though, if none of the above happens? What if advertisers don’t rebel, governments don’t act, users don’t quit, and the good ship Zuckerberg and all who sail in her continues blithely on? We should look again at that figure of two billion monthly active users. The total number of people who have any access to the internet – as broadly defined as possible, to include the slowest dial-up speeds and creakiest developing-world mobile service, as well as people who have access but don’t use it – is three and a half billion. Of those, about 750 million are in China and Iran, which block Facebook. Russians, about a hundred million of whom are on the net, tend not to use Facebook because they prefer their native copycat site VKontakte. So put the potential audience for the site at 2.6 billion. In developed countries where Facebook has been present for years, use of the site peaks at about 75 per cent of the population (that’s in the US). That would imply a total potential audience for Facebook of 1.95 billion. At two billion monthly active users, Facebook has already gone past that number, and is running out of connected humans. Martínez compares Zuckerberg to Alexander the Great, weeping because he has no more worlds to conquer. Perhaps this is one reason for the early signals Zuck has sent about running for president – the fifty-state pretending-to-give-a-shit tour, the thoughtful-listening pose he’s photographed in while sharing milkshakes in (Presidential Ambitions klaxon!) an Iowa diner.

    Whatever comes next will take us back to those two pillars of the company, growth and monetisation. Growth can only come from connecting new areas of the planet. An early experiment came in the form of Free Basics, a program offering internet connectivity to remote villages in India, with the proviso that the range of sites on offer should be controlled by Facebook. ‘Who could possibly be against this?’ Zuckerberg wrote in the Times of India. The answer: lots and lots of angry Indians. The government ruled that Facebook shouldn’t be able to ‘shape users’ internet experience’ by restricting access to the broader internet. A Facebook board member tweeted that ‘anti-colonialism has been economically catastrophic for the Indian people for decades. Why stop now?’ As Taplin points out, that remark ‘unwittingly revealed a previously unspoken truth: Facebook and Google are the new colonial powers.’

    So the growth side of the equation is not without its challenges, technological as well as political. Google (which has a similar running-out-of-humans problem) is working on ‘Project Loon’, ‘a network of balloons travelling on the edge of space, designed to extend internet connectivity to people in rural and remote areas worldwide’. Facebook is working on a project involving a solar-powered drone called the Aquila, which has the wingspan of a commercial airliner, weighs less than a car, and when cruising uses less energy than a microwave oven. The idea is that it will circle remote, currently unconnected areas of the planet, for flights that last as long as three months at a time. It connects users via laser and was developed in Bridgwater, Somerset. (Amazon’s drone programme is based in the UK too, near Cambridge. Our legal regime is pro-drone.) Even the most hardened Facebook sceptic has to be a little bit impressed by the ambition and energy. But the fact remains that the next two billion users are going to be hard to find.

    That’s growth, which will mainly happen in the developing world. Here in the rich world, the focus is more on monetisation, and it’s in this area that I have to admit something which is probably already apparent. I am scared of Facebook. The company’s ambition, its ruthlessness, and its lack of a moral compass scare me. It goes back to that moment of its creation, Zuckerberg at his keyboard after a few drinks creating a website to compare people’s appearance, not for any real reason other than that he was able to do it. That’s the crucial thing about Facebook, the main thing which isn’t understood about its motivation: it does things because it can. Zuckerberg knows how to do something, and other people don’t, so he does it. Motivation of that type doesn’t work in the Hollywood version of life, so Aaron Sorkin had to give Zuck a motive to do with social aspiration and rejection. But that’s wrong, completely wrong. He isn’t motivated by that kind of garden-variety psychology. He does this because he can, and justifications about ‘connection’ and ‘community’ are ex post facto rationalisations. The drive is simpler and more basic. That’s why the impulse to growth has been so fundamental to the company, which is in many respects more like a virus than it is like a business. Grow and multiply and monetise. Why? There is no why. Because.

    Automation and artificial intelligence are going to have a big impact in all kinds of worlds. These technologies are new and real and they are coming soon. Facebook is deeply interested in these trends. We don’t know where this is going, we don’t know what the social costs and consequences will be, we don’t know what will be the next area of life to be hollowed out, the next business model to be destroyed, the next company to go the way of Polaroid or the next business to go the way of journalism or the next set of tools and techniques to become available to the people who used Facebook to manipulate the elections of 2016. We just don’t know what’s next, but we know it’s likely to be consequential, and that a big part will be played by the world’s biggest social network. On the evidence of Facebook’s actions so far, it’s impossible to face this prospect without unease.

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Today’s News 2nd September 2017

  • Coming To A Town Near You: Expert Warns That No-Go Zones Are Growing In America

    Authored by Daniel Lang via SHTFplan.com,

    Nothing epitomizes the failure of Europe’s immigration policies more than the notorious “no-go zones.”

    For decades the West has opened its borders to people who don’t share their values, and the West has utterly failed to encourage these people to assimilate. To even suggest that is now considered racist in many European countries.

    The lack of assimilation has reached a degree that many of these populations have become resentful of their mediocre status in society, and have actually become more insular. Younger generations of these immigrants are more likely to follow ideologies like radical Islam, and they’re less likely than their parents to interact with native born Europeans. Many of them don’t even speak any European languages.

    The result has been the rise of dozens of no-go zones, which dot the urban landscapes of Europe. These are places that act as ethnic enclaves within their host countries. They are nations within nations, where outsiders are routinely shunned, berated, and beaten if they dare enter. In addition to that, they’ve become hotbeds of terrorism and civil unrest. And believe it or not, these Islamic no-go zones are beginning to show up in the United States.

    That’s according to Raheem Kassam, a conservative political activist and author from the UK. He recently wrote a book on the subject of no-go zones, which reveals startling similarities between the Middle Eastern enclaves of Europe and America.

    Places like the Cedar Riverside area of Minneapolis, where Shariah cops make house checks to make sure Somali refugees are not becoming too Westernized, and Hamtramck, Michigan, where the call to prayer is blasted over loudspeakers in Arabic and storefronts that once peddled Polish sausage are now brimming with halal meats.

     

    These can be the early warning signs of a budding no-go zone, says Kassam. But even more crucial, he says, is the level of assimilation by second and third generation Muslim Americans. If the experience of Europe is any indication, trouble is on the horizon for U.S. cities.

    Of course, America has always had neighborhoods that were predominantly inhabited by various immigrant groups. But over time those immigrants still assimilated. That’s not what we’re seeing is America’s Muslim neighborhoods.

    “But you look at the Muslim immigrants and they’re not doing that, they’re actually further ghettoizing, they’re moving inward, not outward.”

     

    Polls by Pew Research show a higher proportion of young Muslims backing terrorism, supporting death for apostasy [leaving Islam], death for homosexuals, and the idea that the woman must cover herself with the hijab or the burqa.

     

    So it’s the opposite trend of Little Italy becoming less like Italy and more like America.

     

    “You see a higher disposition than their parents who believe these things,” Kassam said. “They’re holding onto this Muslim-American sort of thing, and they’re being supported by the political left.”

     

    Kassam includes a whole chapter on Hamtramck, which in 2015 became the first U.S. city to elect a majority-Muslim city council. Several years before that, in 2011, the city approved the Muslim call to prayer over loudspeakers, effectively chasing away many of the last Polish holdouts.

    What’s going on in Europe right now should stand as a warning to Americans. Those countries have made a terrible mistake with their immigration policies, which they may be paying for over the next few generations. But unlike Europe, we still have time to change course. We can still adopt a sensible immigration policy that invites people who treasure our values, and turns back those who would have no respect for what we stand for.

  • The Working Class Can't Afford The American Dream

    For millions of middle- and working-class Americans, the "American Dream" is all but dead.  Far from being able to afford their own homes, the Fed’s latest survey on the wellbeing of US households revealed that nearly a quarter of Americans are unable to pay their monthly bills on time, and nearly half have less than $400 in the bank…

    But in what’s perhaps the most comprehensive analysis of the financial security of American workers, a study published by HowMuch.net explores the true cost of living for working-class Americans in dozens of US cities.

    What they found is hardly surprising. In most areas of the country, the average working-class household would be running a spending deficit. According to HowMuch’s methodology, the best place to live from a financial perspective on an Average Joe’s salary is Fort Worth, Texas, which would leave a working-class family with a $10,447 surplus at the end of the year. On the flip side, that same family would need an additional $91,184 just to break even in New York City.

    To arrive at these scores, the researchers used data from the Bureau of Labor Statistics for income levels, the National Bureau of Economic Research for tax data, and the U.S. Department of Agriculture for the cost of food.

    Newark, NJ, Chesapeake, VA and Jacksonville, FL are the only coastal cities where a worker can adequately support his family without accumulating debt. Notice there are exactly zero affordable cities on the west coast.

    Likewise, San Antonio is the only one of the top 10 most populated cities where a working-class family can afford a decent living. Out of the top 50 cities, only a dozen qualify.

    HowMuch illustrates its data in the map below. The darker the shade of red, the worse off the typical working-class family is. The darker the shade of green, the better off they would be. The size of the bubble also fits on a sliding scale—large and dark red means the city is totally unaffordable. Bigger dark green bubbles likewise indicate a city where the working class can get by.

    And as you can see, the red is much more prominent than the green.

    So where are the best places for working-class families to live? Here are the top five cities with the net surplus wokers are left with after living expenses.

    1. Fort Worth, TX ($10,447)

    2. Newark, NJ (($10,154)

    3. Glendale, AZ ($10,120)

    4. Gilbert, AZ ($9,760)

    5. Mesa, AZ ($7,780)

    And here are the five worst cities, with their associated cost-of-living deficits.

    1. New York, NY (-$91,184)

    2. San Francisco, CA (-$83,272)

    3. Boston, MA (-$61,900)

    4. Washington, DC (-$50,535)

    5. Philadelphia, PA (-$37,850)

    Readers can take a more in-depth look at the data using HowMuch’s True Cost of Living tool, which is available here.
     

  • Precious Metals Outperform Markets In August – Gold +4%, Silver +5%

    Precious Metals Outperform Markets In August – Gold +4%, Silver +5%

     – All four precious metals outperform markets in August
    – Gold posts best month since January, up nearly 4%
    – Gold reaches highest price since US election, climbs due to uncertainty and safe haven demand
    – S&P 500 marginally higher; Euro Stoxx, Nikkei lower for month

    – Platinum is best performing metal climbing over 5%
    – Palladium climbs over 4% thanks to seven year supply squeeze
    – Fear, uncertainty and political sanctions are amongst biggest drivers for precious metals
    – Never been a better time to diversify and rebalance portfolios with stocks and bonds near record highs and looking vulnerable

    Editor: Mark O’Byrne

    Market Performance in August (Finviz.com)

    All four precious metals have made gains in the month of August.

    Whilst platinum and palladium’s leading performances can largely be attributed to industrial factors they have also benefited from the safe haven demand which is driving gold and silver prices.

    Safe haven demand really came into its own this last month. Issues with North Korea have stepped up a level whilst markets have finally begun to question the complacency they have been feeling in regard to the US political and financial situation, geopolitical risk and the increasingly uncertain outlook for the global economy.

    Ultimately very little is known about what will happen with the US debt ceiling, increasingly overvalued stocks (both the NASDAQ and  the S&P500), Trump’s plans for corporate tax, dealings with North Korea and (not forgetting) Venezuela.

    We are living in very uncertain times indeed and investors decided to allocate funds to the ultimate safe havens – the precious metals.

    Gold shines as investors rush into safe havens

    This week gold rose to its highest point so far in 2017 as tensions between North Korea (but really, the rest of the world) and the US ramped up. For the month of August the price is up 3.59%.

    Silver was also up thanks to safe haven demand, but its 5% climb was also in part due to manufacturing demand. Currently, about 55% of all silver consumed is for industrial use.

    Gold has so far risen in every month, bar June.

    Gold’s climb has in part been due to ongoing demand from countries such as China and India, but it has primarily been driven by the desire in the West to own a safe haven. This is not surprising given the ongoing concerns regarding North Korea, Venezuela, the Middle East and a lack of cohesion in the Trump administration.

    One of the dampeners on gold and silver has been the Federal Reserve’s plans to raise interest rates. However, when they did so it had little effect. Expectations for further hikes are falling. Going forward Yellen and team are expected to slow down on further interest-rate increases which has provided an additional boost for the gold price.

    In the very short-term storm Harvey in Houston, Texas has also impacted the price of gold and silver. As a result of lost income and recovery operations, US GDP is expected to be lower in the third-quarter than was initially expected.

    In the long-term investors will look to gold and silver as they begin to price risk into the market. Yesterday we expressed our concerns over market complacency whilst other financial organisations have begun to warn clients about the overpriced equity markets and lack of perceived risk.

    It is also worth noting an expected climb in demand from China. Mark Tinker, Head of AXA Framlington wrote in a note that China’s pricing of assets in yuan (together with the plan by the Hong Kong Stock Exchange to  sell yuan-priced physical gold contracts) could allow them to trade out of the banking system in the US

    “Having accepted payment for oil or gas in RMB, the seller, be it Russia or Saudi Arabia or anyone else for that matter, does not have to worry about having excess RMB, they can simply trade it back into gold,” Tinker said. “We are moving to a multi-polar world.”

    Platinum gains as Russia feels the pain

    Platinum has performed very well so far in the second half of the year. This most recent surge has likely come about thanks to further sanctions being placed on Russia by the US. Russia is the world’s second biggest producer of the metal.

    The World Platinum Investment Council outlined the following arguments for platinum’s role as a safe haven investment asset:

    – Supply demand fundamentals are strong and ETF holdings are stable, despite price volatility
    – Risks of supply declines are underestimated – cost pressure and falling mining investment continue – Downside risks to platinum automotive demand are overestimated
    – Futures positioning follows poor sentiment with high correlation to price
    – Platinum is undervalued against its past, its production cost and against gold

    Palladium climbs on Vauxhall’s woes

    Palladium is currently at a 16 year high. There is a major tightening in the supply of palladium because of increased demand for it in engines. 67% of palladium supply is used in car engines to clean exhaust gases from gasoline engines. There is obviously a major push for ‘clean’ transport and the Vauxhall emissions scandal and obviously helped boost demand.

    Inventories of palladium supply are down by abut 45% this year, whilst supply trails demand by the most in the seven years.

    Despite the increase in supply, there has been a significant number of redemptions in the the two main U.S. and European palladium ETFs – the ETFS Physical Palladium Shares and the ZKB Palladium. By the 22nd August $49 million had been traded in. Supply in the spot market is reportedly so tight that companies are being forced to trade in multiple ETF shares in order to redeem them with the issuer in exchange for physical palladium.

    ETFs are now being treated like palladium warehouses.

    It is also important to note that, like platinum, palladium is also hugely affected by the sanctions on Russia.

    It is also important to note that ETFs are a risky way to invest in precious metals and most investors would be better served owning actual precious metals rather than paper or digital proxies.

    Conclusion: Stars aligning? Outlook good for rest of 2017

    Earlier this week we explained how investors shouldn’t always be focused on price. Whilst it is nice to look at the metrics for August and see that all precious metals are up, we should instead focus on why they are up and most importantly the diversification benefits for our portfolios.

    Precious metals are largely climbing because the perceived risk in the political and financial system is also climbing. Interestingly many commentators do not feel some risky issues have been wholly appreciated by the markets.

    Problems such as North Korea are such serious risks that even someone who pays no attention to markets could spot it. The issue is that you have an overvalued stock market and a US President who cannot get his people together. This means that the US debt ceiling issue might ground the U.S. government to a halt.

    These issues are ones which have not yet been fully priced into the markets. They likely will be in the coming months and then the safe haven role of the precious metals and gold in particular will come into its own.

    News and Commentary

    Gold up 4% in August – largest monthly gain since January (Marketwatch)

    Gold steady near 9-1/2 month highs as N.Korea tensions persist (Reuters)

    Gold Scores Fifth Monthly Increase; US Mint Bullion Sales Slow in August (Coin News)

    Gold edges lower, but N.Korea worries lend support (Nasdaq)

    Massive wartime bomb to be defused near German gold reserves (Irish Times)

    Source: Marketwatch

    From Stocks to Bonds, the Bear-Market Signals Are Multiplying (Bloomberg)

    Rothschild reduces exposure to US stocks amid turmoil (Standard)

    Five charts show why millennials are worse off than their parents (FT.com)

    When the Butterfly Flaps Its Wings – Kunstler (Zerohedge)

    Buffett: North Korea situation is very concerning (CNBC)

    Gold Prices (LBMA AM)

    01 Sep: USD 1,318.40, GBP 1,020.18 & EUR 1,107.98 per ounce
    31 Aug: USD 1,305.80, GBP 1,013.17 & EUR 1,098.31 per ounce
    30 Aug: USD 1,310.60, GBP 1,014.93 & EUR 1,096.71 per ounce
    29 Aug: USD 1,323.40, GBP 1,020.34 & EUR 1,097.36 per ounce
    25 Aug: USD 1,287.05, GBP 1,003.90 & EUR 1,090.90 per ounce
    24 Aug: USD 1,285.90, GBP 1,003.26 & EUR 1,090.44 per ounce
    23 Aug: USD 1,286.45, GBP 1,004.33 & EUR 1,091.68 per ounce

    Silver Prices (LBMA)

    01 Sep: USD 17.50, GBP 13.53 & EUR 14.69 per ounce
    31 Aug: USD 17.34, GBP 13.47 & EUR 14.62 per ounce
    30 Aug: USD 17.44, GBP 13.49 & EUR 14.60 per ounce
    29 Aug: USD 17.60, GBP 13.59 & EUR 14.62 per ounce
    25 Aug: USD 17.02, GBP 13.26 & EUR 14.40 per ounce
    24 Aug: USD 16.93, GBP 13.20 & EUR 14.36 per ounce
    23 Aug: USD 17.06, GBP 13.32 & EUR 14.48 per ounce


    Recent Market Updates

    – 4 Reasons Why “Gold Has Entered A New Bull Market” – Schroders
    – Gold Reset To $10,000/oz Coming “By January 1, 2018” – Rickards
    – Gold Surges 2.6% After Jackson Hole and N. Korean Missile
    – Diversify Into Gold On U.S. “Political Instability” Advise Blackrock
    – Trump Presidency Is Over – Bannon Is Right
    – The Truth About Bundesbank Repatriation of Gold From U.S.
    – Cyberwar Risk – Was U.S. Navy Victim Of Hacking?
    – Global Financial Crisis 10 Years On: Gold Rises 100% from $650 to $1,300
    – Mnuchin: I Assume Fort Knox Gold Is Still There
    – Buffett Sees Market Crash Coming? His Cash Speaks Louder Than Words
    – Gold, Silver Consolidate On Last Weeks Gains, Palladium Surges 36% YTD To 16 Year High
    – Must See Charts – Gold Hedges USD Devaluation, Rise in Oil, Food and Cost of Living Since Nixon Ended Gold Standard
    – World’s Largest Hedge Fund Bridgewater Buys $68 Million of Gold ETF In Q2

    Important Guides

    For your perusal, below are our most popular guides in 2017:

    Essential Guide To Storing Gold In Switzerland

    Essential Guide To Storing Gold In Singapore

    Essential Guide to Tax Free Gold Sovereigns (UK)

    Please share our research with family, friends and colleagues who you think would benefit from being informed by it.

  • Pat Buchanan Exposes What Harvey Really Wrought

    Authored by Patrick Buchanan via Buchanan.org,

    Like 9/11, Hurricane Harvey brought us together.

    In awe at the destruction 50 inches of rain did to East Texas and our fourth-largest city and in admiration as cable television showed countless hours of Texans humanely and heroically rescuing and aiding fellow Texans in the worst natural disaster in U.S. history.

    On display this week was America at her best.

    Yet the destruction will not soon be repaired. Nearly a third of Harris County, home to 4.5 million people, was flooded. Beaumont and Port Arthur were swamped with 2 feet of rain and put underwater.

    Estimates of the initial cost to the Treasury are north of $100 billion, with some saying the down payment alone will be closer to $200 billion. In inflation-adjusted dollars, the cost of Harvey will exceed that of the Marshall Plan, which rebuilt Europe after World War II.

    Though the country has appeared united since the storm hit, it is not likely to remain so. Soon, the cameras and correspondents will go home, while the shelters remain full, as tens of thousands of people in those shelters have only destroyed homes to return to.

    When the waters recede, the misery of the evacuees left behind will become less tolerable. Then will come the looters and gougers and angry arguments over who’s to blame and who should pay.

    They have already begun. Republicans who balked at voting for the bailout billions for Chris Christie’s New Jersey after Hurricane Sandy ravaged the coast in 2012 are being called hypocrites for asking for swift and massive federal assistance to repair red state Texas.

    And whereas George W. Bush soared to 90 percent approval after 9/11, no such surge in support for Donald Trump appears at hand.

    Indeed, the sneering and sniping began on his first visit to Texas.

    He failed to celebrate the first responders, they said…

     

    He failed to hug any of the victims…

     

    He failed to show empathy

     

    First lady Melania Trump wore spiked heels boarding Marine One for Texas.

    A prediction: The damage done by Harvey — as well as the physical, psychic and political costs — will cause many to echo the slogan of George McGovern in 1972, when he exhorted the country to “come home, America.”

    The nation seems more receptive now, for even before Harvey, the media seemed consumed with what ails America.

    The New York and D.C. subway systems are crumbling.

    Puerto Rico is bankrupt.

    Some states, such as Illinois, cannot balance their budgets.

    The murder rates are soaring in Baltimore and Chicago.

    Congress this month will have to raise the debt ceiling by hundreds of billions and pass a budget with a deficit bloated by the cost of Harvey.

    And the foreign crises seem to be coming at us, one after another.

    Russia is beginning military maneuvers in the Baltic and Belarus, bordering Poland, with a force estimated by some at 100,000 troops — Vladimir Putin’s response to NATO’s deployment of 4,000 troops to the Baltic States and Poland.

    The U.S. is considering sending anti-tank missiles to Kiev. This could reignite the Donbass war and bring Russian intervention, the defeat of the Ukrainian army and calls for U.S. intervention.

    In the teeth of Trump’s threat to pour “fire and fury” on North Korea, Kim Jong Un just launched an intermediate-range ballistic missile over Japan. Trump’s answer: U.S. B-1Bs make practice bombing runs near the demilitarized zone. Reports from South Korea indicate that Kim may soon conduct a sixth underground test of an atomic bomb.

    War in Korea has never seemed so close since Dwight Eisenhower ended the Korean War with an armistice more than 60 years ago.

    Despite the opposition of his national security team, Trump is said to be ready to repudiate the Iranian nuclear deal in October, freeing Congress to reimpose the sanctions lifted by the deal.

    This would split us from our NATO allies and, if Iran ignored the new U.S. sanctions or began anew to enrich uranium, force Trump’s hand. Is he, are we as a country, ready for another trillion-dollar war, with Iran, which so many inside the Beltway seem so eager to fight?

    The U.S. and Turkey have urged Iraq’s Kurds to put off their nonbinding referendum on independence Sept. 25. The vote seems certain to endorse a separate state. A Kurdistan, seceded from Baghdad, would be a magnet for secession-minded Kurds in Turkey, Syria and Iran, 30 million in all, and present a strategic crisis for the United States.

    Along with the steady growth of entitlement spending, the new dollars demanded for defense, the prospect of new wars and the tax cuts the White House supports, Hurricane Harvey should concentrate the mind.

    Great as America is, there are limits to our wealth and power, to how many global problems we can solve, to how many wars we can fight and to how many hostile powers we can confront.

    The “indispensable nation” is going to have to begin making choices. Indeed, that is among the reasons Trump was elected.

  • Pension Ponzi Exposed: Minnesota Underfunding Triples After Tweaking This One Small Assumption…

    Defined Benefit Pension Plans are, in many cases, a ponzi scheme.  Current assets are used to pay current claims in full despite insufficient funding to pay future liabilities… classic Ponzi.  But unlike wall street and corporate ponzi schemes no one goes to jail here because the establishment is complicit.  Everyone from government officials to union bosses are incentivized to maintain the status quo…public employees get to sleep better at night thinking they have a “retirement plan,” public legislators get to be re-elected by union membership while pretending their states are solvent and union bosses get to keep their jobs while hiding the truth from employees.  

    So what allows this ponzi to persist?  It all comes down to one simple assumption: Discount Rates.  You see, if you simply discount future liabilities at a high enough discount rate then you can make any massively underfunded pension ponzi look like a stable, healthy retirement gold mine. 

    In fact, just over a year ago we took a look at what would happen if we calculated the true underfunded level of America’s public pensions at more reasonable discount rates.  The result showed that the media’s highly referenced underfunding of $2 trillion soared to something closer to $5-$8 trillion when more reasonable discount rates were employed.

    We decided to take a look at what would happen if all federal, state and local pension plans decided to heed the advice of Mr. Gross. As one might suspect, the results are not pleasant.  We conservatively assume that public pensions are currently $2.0 trillion underfunded ($4.5 trillion of assets for $6.5 trillion of liabilities) even though we’ve seen estimates that suggest $3.5 trillion or more might be more appropriate.  We then adjusted the return on asset assumption down from the 7.5% used by most pensions to the 4.0% suggested by Mr. Gross and found that true public pension underfunding could be closer to $5.5 trillion, or over 2.5x more than current estimates.  Others have suggested that returns should be closer to risk-free rates which would imply an even more draconian $8.4 trillion underfunding.  

     

    Pension Underfudning

     

    Now, the state of Minnesota has gracefully stepped forward to beautifully illustrate our point.  Upon making a few minor “tweaks” to their various funds’ discount rates, the state found that their aggregate pension underfunding more than tripled from roughly $16 billion to over $50 billion.  Here’s more from Bloomberg:

    Minnesota’s debt to its workers’ retirement system has soared by $33.4 billion, or $6,000 for every resident, courtesy of accounting rules.

     

    The jump caused the finances of Minnesota’s pensions to erode more than any other state’s last year as accounting standards seek to prevent governments from using overly optimistic assumptions to minimize what they owe public employees decades from now. Because of changes in actuarial math, Minnesota in 2016 reported having just 53 percent of what it needed to cover promised benefits, down from 80 percent a year earlier, transforming it from one of the best funded state systems to the seventh worst, according to data compiled by Bloomberg.

     

    The Minnesota’s teachers’ pension fund, which had $19.4 billion in assets as of June 30, 2016, is expected to go broke in 2052. As a result of the latest rules the pension has started using a rate of 4.7 percent to discount its liabilities, down from the 8 percent used previously. As a result, its liabilities increased by $16.7 billion.

     

    But other factors also helped boost Minnesota’s liabilities: Eight of Minnesota’s nine pensions reduced their assumed rate of return on their investments to 7.5 percent from 7.9 percent, while three began factoring in longer life expectancy.

    All of which resulted in this:

    Minnesota

     

    Of course, Minnesota’s underfunding didn’t just magically “soar by $33.4 billion” as Bloomberg puts it…in reality, the state’s pensions were always underfunded by ~$50 billion…the only difference is that that some pension administrators finally decided to stop lying to their retirees and report reality.

    All of which rendered this Bloomberg map from just two months ago showing an 80% funding ratio for Minnesota completely obsolete…

     

    …Sorry, Minnesota teachers but you’re almost as screwed as your counterparts in Illinois…you just didn’t know it until your bosses finally decided to stop lying to you.

    Pension map

  • "I'm Not Scared To Shoot You" – Shotgun-Wielding Man Protects Houston Neighborhood

    Authored by Daisy Luther via The Organic Prepper blog,

    A man named Nash decided to protect his community from looters after Hurricane Harvey left the Houston area vulnerable.

    Unfortunately, after a disaster, some people decide it’s the perfect time to steal from others.

    This scenario is commonly known in survivalist circles as “without rule of law.”

    It means that criminals aren’t concerned about consequences, 911 isn’t an option, and it is every person for themselves. If you aren’t ready to protect yourself, you are likely to become a victim.

    You’ll note that the woman who is shooting the video of the man with the shotgun said that even some so-called “rescuers” were stealing from the people who got into their boats to escape their flooded homes.

    This is well worth a listen for anyone who wants to be as prepped for the aftermath of a disaster as for the disaster itself. It’s a strong case for what I’ve said for years. Preppers MUST be armed if they want to be truly prepared. (For more stories like this, please subscribe to my daily newsletter.)

    I wouldn’t mess with this guy. It’s obvious that he means business. This was a Facebook Live video shot by Tay Mayberry. (Warning: profanity.)

    Instructions: Click the arrow at the bottom of the photo below for the video. If you don’t have sound, right click and select “Unmute.” You definitely want to hear this.

    (If the video doesn’t work on your device, go here for the original.)

    So, let’s be absolutely clear. The residents of the area have no option to call 911. There are no cops who will come and save them. They are absolutely on their own. This is what a “without rule of law” situation is like.

    The shotgun-wielding man, identified as “Nash” said, in part:

    If you go back in that store, I’m telling you one time, I’m not scared to shoot you. I’m an ex-f**king SWAT deputy. I will cut your ass in half. Don’t go in that store no goddamn more!

     

    I ain’t got a problem with shooting; I still got a license. Try me if you want! I’m a former law enforcement officer. I still support law enforcement; those that do right.

     

    HPD (Houston Police Department) officers right now in the back of city trucks, all armed with AR-15s gotta go back to the neighborhood that’s still underwater, flooded, and try and protect these people. It don’t make no sense that these guys out here too lazy to get a damn job; the energy they using to rob they didn’t even try to use that energy to rescue people.

     

    If you’re looting, it’s a violation of federal law, it’s a violation of Texas law at the time of a catastrophe.

    Looters can be seen running from the store. Mayberry’s narrative of the video is heartbreaking and gives you a clear picture of the lack of order after a disaster.

    When her mother asks Nash if anyone has called 911 for him, Mayberry replies:

    911 ain’t gonna come, Mama. 911 is outta there. It’s either martial law or everybody else watch you. 911 ain’t out there. There IS no law.

    She says:

    So this is what the hell the news ain’t showing ya’ll. This is what we’re going through on top of this storm. I was scared to call a rescue boat because the people on the rescue boats are rescuing people and then they f**king robbing us ya’ll.

     

    We can’t call rescue boats because they have fake people posing on the rescue boats and when they come to your house they are robbing you in this storm. So you can’t call anybody to rescue you. You literally have to get out yourself.”

    As well…

    “There is no 911. There is no police. There is no law.”

    Being prepared for a disaster is only half the battle. To survive, you have to be prepared for what comes after the disaster.

  • "Trump Should Be Concerned": Mueller Partners With "Elite" IRS Investigations Unit

    Special Counsel Robert Mueller’s team of investigators are leaving no stone unturned in their crusade to find something they can use to try and turn a member of Trump’s inner circle, The Daily Beast is reporting, citing a source close to Mueller, that the special counsel’s office has teamed up with the IRS’s Criminal Investigations Unit. The “elite” IRS investigations squad will help ensure that investigators apply the maximum possible scrutiny to the finances of Trump’s inner circle in an investigation that’s nominally about election fraud.

    Of course, the public has long been aware, thanks to Mueller’s collaborators in the media, that his team has no solid evidence to support a charge of election fraud against Trump or members of his circle. And while this latest “partnership” just confirms widely held suspicions that Mueller & Co. are grasping at straws, it could provide Mueller an opening to strike directly at the president, his family and closest advisers – or at least embarass Trump with a fresh batch of leaks.

    First, as the Daily Beast points out, partnering with the IRS will allow Mueller’s team to access Trump’s tax returns, which we can only assume will promptly be leaked to one of the former FBI director’s favorite journalists at the Washington Post or New York Times.  

    “This unit—known as CI—is one of the federal government’s most tight-knit, specialized, and secretive investigative entities. Its 2,500 agents focus exclusively on financial crime, including tax evasion and money laundering. A former colleague of Mueller’s said he always liked working with IRS’ special agents, especially when he was a U.S. Attorney.

     

    And it goes without saying that the IRS has access to Trump’s tax returns—documents that the president has long resisted releasing to the public.

     

    Potential financial crimes are a central part of Mueller’s probe. One of his top deputies, Andy Weissmann, formerly helmed the Justice Department’s Enron probe and has extensive experience working with investigative agents from the IRS."

    Both Mueller and his deputy, Andy Weissmann, who formerly led the Justice Department’s Enron probe, have “extensive” experience working with IRS agents. So there’s little doubt they will play ball.

    “’From the agents, I know everyone has the utmost respect for both Mueller and Weissmann,’ said Martin Sheil, a retired IRS Criminal Investigations agent.”

    In its report, the Daily Beast shares some fresh insight into the prosecution’s case against Manafort. Naturally, we have a few questions: Can somebody explain what role Paul Manafort’s forgetting to check a box on his tax returned played in the grand conspiracy to rig the 2016 election?

    “It’s been widely reported that the special counsel’s team is trying to “flip” Paul Manafort, the president’s former campaign CEO, in hopes he will provide evidence against his former colleagues. Former federal prosecutors tell The Daily Beast one of Manafort’s biggest legal liabilities could be to what’s called a “check the box” prosecution. Federal law requires that people who have money in foreign bank accounts check a box on their tax returns disclosing that. And there’s speculation that Manafort may have neglected to check that box, which would be a felony. This is exactly the kind of allegation the IRS would look into.”

    Even if Mueller and his team can’t find anything to justify an indictment, at least they can still punish members of Trump’s inner circle for their association with the president. Call it a consolation prize for inconsolable liberals.

    “These investigations, which are often extremely complex, can take a lot of time. That means the people involved sometimes have to spend significant amounts of money on legal fees. The Daily Beast previously reported that targets of Mueller’s probe—including Manafort—are facing financial strain because of the probe, and that Manafort recently parted ways with the law firm WilmerHale in part because of his financial troubles.”

    In a shocking moment of candor, the Daily Beast hints at what looks to be an ulterior motive for Mueller’s partnership with the IRS. The Trump administration never appointed an AAG to supervise the DOJ’s tax division, which would have to sign off on any charges relating to their finances. Therefore, he has “no one to keep Mueller in check,” as one former prosecutor phrased it.  

    “The fact that there is not a senate-confirmed Assistant Attorney General for the Tax Division, and that the Trump people have disregarded it despite warnings as far back as December that they needed to fill the AAG’s spot… shows what a self-created mess the Trump administration has found itself in,” said the former prosecutor, who requested anonymity to speak candidly. “They have no one to keep Mueller and his Brooklyn team honest. They should be concerned about that.”

    To summarize, even if it has nothing to do with Donald Trump Jr.’s willingness to acquire “opposition research” on the Clinton’s, or Jared Kushner’s initial failure to disclosure meetings with certain foreign officials on his security clearance application – or any of the other leaks used to cast aspersions on Trump and his associates – Mueller may have found his opening. It may only be a matter of time before the other shoe drops.
     

  • Rickards: "There Are Three Things Going On With Gold Right Now"

    Authored by Craig Wilson via Daily Reckoning blog,

    Jim Rickards joined Kitco News and Daniela Cambone to discuss the latest news and analysis from gold markets, geopolitics and even bitcoin.  The Wall Street veteran took on the bigger picture facing metals investors and what could be just around the corner in a bubbling market.

    Jim Rickards is the editor of Strategic Intelligence and is the New York Times best-selling author of The Road to Ruin. Rickards’ worked on Wall Street for decades and has advised the U.S intelligence community on international finance, trade and financial warfare.

    When asked why certain geopolitical tensions have greater impacts on gold and hard assets than others Rickards remarked, “There are two things going on,

    “… first is that the North Korean missile threat goes from high tension to back down again. This is a very serious threat and we are headed for war with North Korea. While I don’t know what it will take to not just get gold to go up but stocks and other sectors, ultimately markets are going to be impacted.”

     

    People seem to have very short attention spans but that’s not how to think about it. It’s possible to see that Kim Jong-un is not deviating from his path to get nuclear weapons, the U.S will not allow it. There’s no middle ground there. It would be great if we could have diplomacy. I think we should also ratchet up sanctions on China. But I don’t see either of those happening.”

     

    Don’t underestimate the extent to which gold is being impacted by hedge funds, leverage players, and others that are in the mix for the current high in gold. They don’t really care if it is gold, soybeans, etc. but it is simply another commodity. They receive a nice profit with tight profits, tight stops.”

     

    “The bigger picture to look as here is that gold hit an interim low last December and has been grinding higher ever since.  Now gold is up over $200 an ounce and is one of the best performing assets in 2017. There’s a pattern of higher highs and shows a very positive occurrence.”

    Gold and Weak Dollar Environment

    The interviewer then shot back at Rickards asking whether the price and actions in the market always come back to the U.S dollar? The best-selling author and economist responded, “This all relates to currency wars. I think of gold by weight.”

    When most people look at the cost of gold they relate it to the dollar. That gives the dollar a privilege to say that it is the way to count everything. It is also possible to count gold in euro, yen or even bitcoin. I think of gold as money. These are all just cross rates. When I see a higher dollar price for gold, I think of the dollar as being weaker. Likewise, if I see a lower price for gold it just shows that gold is constant and the dollar got stronger.”

     

    There are three things going on right now in gold. There’s a fear trade, there’s technicals with supply shortages and ultimately a weaker dollar. If you want to know where the dollar price for gold is going, ask yourself where the dollar is headed. As the dollar gets weaker due to Federal Reserve Chair Yellen’s plan to tighten rates into weakness. We’re getting disinflation, not inflation and the desire from the Fed is a weaker dollar.”

    When The Street’s Daniela Cambone prompted Rickards on the rally in gold and whether it would be rejuvenated he leveled,

    I expect to see gold hit $5,000 and eventually to $10,000 an ounce. Maybe not tomorrow or a couple of years but that is the fundamental price of gold as money.

     

    “In a recent conversation with legendary commodity investor Jim Rogers he indicated to me was, ‘nothing goes to that level without a 50% retracing before it resumes its path upwards.’ Moves happen very fast. The question is, what are the catalysts that could take it higher?”

    Is Bitcoin Stealing Gold’s Thunder?

    Speaking on catalysts and what could shake the gold market the interviewer then asked whether Bitcoin could have a significant impact. Rickards pushed back,

    “Bitcoin is a very small market cap compared to gold. I don’t think it has much impact on gold and looks like a bubble right now.”

     

    “As someone who has been around Wall Street a long time I’ve seen a lot of different tricks of the trade and frauds that come and go. I am seeing all of the various schemes in bitcoin right now. There’s good forensic evidence that there are people doing wash sales right now and the suckers don’t know they are getting sucked in. Gold is still the ultimate safe haven.

    German Gold and ‘Weird’ Commodity Movements

    Recently, Germany moved to reacquire its gold being held within the Federal Reserve system. Rickards latest analysis on the situation detailed that,

    “In 2013 the central bank in Germany said it wanted its gold back from the UK, France and the US. Here’s the thing, Germany does not want all of its gold back.”

     

    “As it is going through its election cycle, there are specific factions of the German government that are pushing to get German gold back to domestically being held. The German elections are in mid-September, it is not a coincidence that this happened just before that. It was to appease political dynamics as well as leasing development of gold.

    Looking internally, the recent visit by Treasury Secretary Mnuchin to the US Mint in Fort Knox stirred many commodity investor analysts. Rickards offered,

    “I was shocked to see the visit. It is rare and only the third time that a Treasury Secretary has visited since the 1930’s.”

     

    “The other thing that is strange about the visit is that the monetary elites don’t want to pay any attention to gold. Several years ago Fed Chair Bernanke was asked about gold and he replied that it is given attention because of tradition. The reason that this official visit matters now is that when gold is being given public attention by government leadership, it enhances the value of gold as a monetary asset. They don’t want the general public to pay attention to gold. The question is, why did he do it and tweet out the visit?”

    Finally, speaking on the mounting complexity of issues facing the American government Rickards warned that gold could be well positioned for the remainder of Fall. Rickards sets up,

    We’re coming up against a debt ceiling and budget train wreck. The US budget is at D-Day at the end of September. Separately, the Treasury is literally running out of cash. The government will have to raise the debt ceiling for the Treasury and it will need to, at the very least, pass a continuing resolution.”

     

    The Treasury has a trick up its sleeve. In 1973, the gold on the books of the Treasury is officially valued at $42.22 per ounce. It would be possible to go mark it to the market just like a hedge fund does. The Treasury could raise the value to a raised price and that difference between $42.22 and the heightened amount would only require a certificate to the Fed for money.”

     

    “That is all under the Gold Act of 1934. The move could open up hundreds of billions of dollars out of thin air just by remarking gold. While I am not saying this is going to happen, it is an option that they have available.”

  • Venezuela Headed For "Messiest Debt-Restructuring In History" Thanks To US Sanctions

    After being effectively shut out from global financial markets – a situation that was made more precarious by US sanctions prohibiting purchases of Venezuelan debt (unless you’re buying them off Goldman Sachs, should the bank’s asset-management arm desire to liquidate its $3 billion “hunger bond” position) – Venezuela is drawing ever-nearer to what the Financial Times describes as potentially the “messiest debt restructuring in history.”

    So far, Venezuela has managed to forestall a default by stripping assets from its state-owned oil company, Petroleos de Venezuela, commonly referred to as PVDSA, and shaking down local institutions of spare dollars – not to mention the explicit financial support of China and Russia. Recently, Rosneft, the largest Russian oil company, helped support its troubled ally, which enjoys the largest crude reserves in the world, by offering billions of dollars in advance payments for future crude supplies. Thanks to a deal brokered by deceased former President Hugo Chavez, Venezuela has for years been Rosneft’s largest foreign supplier of crude. Last year, the oil giant accepted a 49.9% stake in PVDSA’s US-based subsidiary, Citgo, as collateral for a $1.5 billion loan.

    Venezuelan President Nicolas Maduro

    However, thanks to the US sanctions, which prohibit purchases of newly issued debt and existing bonds that have so far not been sold outside of Caracas, the country will once again need to innovate or risk sliding into bankruptcy. Making matters all the more urgent, the country recently suffered a loss in US courts after a judge ruled that Canadian miner Crystallex can seize Venezuelan money held in a custody account at Bank of New York Mellon to cover a $1.4 billion judgment awarded by a World Bank tribunal.

    Crystallex’s victory could further embolden the country’s creditors, who collectively may be owed as much as $3.7 billion.

    “Venezuela has been taken to the World Bank’s ICSID tribunal 43 times. Only Argentina has been subjected to more claims. Of these 24 are still pending, including claims from Anglo American, ConocoPhillips, Air Canada and Vestey. The Eurasia Group estimates that Venezuela owes a total of $3.7bn as a result of ICSID rulings, and Crystallex’s progress is likely to embolden other creditors.”

    Adding to the country’s troubles, a major US clearing house has said it will stop settling some Venezuelan bonds, and Cantor Fitzgerald has stopped trading them altogether.

    After months of rhetoric, the US – which for years maintained an uneasy business relationship with Venezuela, formerly South America’s wealthiest economy – has severed the country’s last tenuous ties to the global financial system…

    “The message is that the US doesn’t want its financial system enabling the Venezuelan government in any way,” says Charles Blitzer, of Blitzer Consulting, who is a former International Monetary Fund official.  

    …And with the Crystallex ruling compounding the country’s troubles, its government is being set up for a “slow burn” leading ultimately to financial insolvency as creditors root out and seize whatever foreign assets they can find.

    “Crystallex is the camel’s toe under the tent,” says Mark Weidemaier, a law professor at the University of North Carolina. “It will be a slow burn, but I wouldn’t be surprised to see people use the courts to ferret out where Venezuela’s assets are . . . and break down the barriers between the government, PDVSA and other entities.”

    Typically, in a sovereign bankruptcy, creditors negotiate some kind of debt relief and trade their old, defaulted bonds for less valuable new ones. However, US sanctions may preclude this as an option for Venezuela, as the FT explains.

    “…such a debt exchange would fall foul of the US sanctions regime, precluding any US banks from arranging one and any US bondholders from tendering their debts. In practice, it would mean indefinite financial purgatory for Venezuela until the US administration decides to lift the prohibition.

     

    “If these sanctions stay in place, then Venezuela cannot restructure and it goes into limbo,” says Edward Al-Hussainy, a senior analyst at Columbia Threadneedle."

    Since Venezuela’s economic crisis began four years ago, imports have fallen precipitously, leading to dire shortages of essentials like medicine and foodstuffs as the country's currency depreciated to the point of worthlessness. Unless the country can find some way to circumvent the sanctions, it will be forced to decide between countenancing further import declines, or a disorderly default.

    According to Torino Capital, a Latin American-focused investment bank, Venezuela could choose the latter.

    “Torino Capital…argued that this might counter-intuitively make a restructuring less likely. ‘It is possible that, faced with this choice, Venezuelan authorities end up deciding that the negative effects of a disorderly default on PDVSA’s capacity to generate export revenue are worse than the contractionary effects of further import cuts,’ the bank wrote in a note to clients.”

    To be sure, a default could still be years away. And investors, for one, aren’t worried. The country’s debt has been largely unperturbed by the recent developments: PDVSA bonds have largely traded sideways, despite the recent developments.

    “In the near term the impact will probably be minimal. Given Venezuela’s messy finances, the country is in practice already shut out of the international bond market. And while Crystallex won a legal skirmish, it is far from winning the war. It is unclear how much money Venezuela holds at BNYM and it may still be protected by sovereign immunity. Underscoring the investor view that little has changed, Venezuela and PDVA’s bonds have largely traded sideways.”

    Still, a default, whenever it arrives, could signal the last gasp of the country’s embattled government. The country's foreign reserves have already fallen below $10 billion (though they received a boost following the Goldman deal…).

    “If they default, they will be out of government within three months,” says Federico Kaune, head of emerging market debt at UBS Asset Management. “The calculation is that they’re either in government, in exile or jail.”

    With the fate of the Maduro regime hanging in the balance, we imagine Washington will do everything in its power to force Venezuela into bankruptcy, allowing the US to claim victory over yet another foreign adversary.
     

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Today’s News 1st September 2017

  • Six Banks Join UBS's "Utility Coin" Blockchain Project

    Here’s a piece of news that the remaining human members of Wall Street’s FX sales and trading desks probably don’t want to hear.

    According to the Financial Times, six of the world’s largest banks have decided to join a blockchain project called “utility coin” that will allow banks to settle trades in securities denominated in different currencies without a money transfer. What’s worse, the banks expect to begin live-testing the project late next year.

    Here’s the FT:

    “Barclays, Credit Suisse, Canadian Imperial Bank of Commerce, HSBC, MUFG and State Street have teamed up to work on the “utility settlement coin” which was created by Switzerland’s UBS to make financial markets more efficient.

     

    The move comes as the project shifts into a new phase of development, in which its members aim to deepen discussions with central banks and to work on tightening up its data privacy and cyber security protections.”

    The project’s managers say they’ve already involved representatives from various central banks…

    “Hyder Jaffrey, head of strategic investment and fintech innovation at UBS, said: “We have been in discussions with central banks and regulators and we will continue that over the next 12 months with the aim of a limited ‘go live’ at the back end of 2018.”

    Here's a brief explanation of how it's expected to work , courtesy of the FT:

    “The utility settlement coin, based on a product developed by Clearmatics Technologies, aims to let financial groups pay each other or to buy securities, such as bonds and equities, without waiting for traditional money transfers to be completed.

     

    Instead they would use digital coins that are directly convertible into cash at central banks, cutting the time, cost and capital required in post-trade settlement and clearing.

     

    The coins, each convertible into different currencies, would be stored using blockchain, or distributed ledger technology, allowing them to be swapped quickly for the financial securities being traded. Existing members of the project are Deutsche Bank, Banco Santander, BNY Mellon and NEX.”

    Initially, utility coin will be used primarily for interbank payments, the banks told the FT. Say two institutions owed one another sums denominated in two different currencies. They could settle those payments in utility coin instead of routing payments through an interbank broker. This will only hasten the declining employment of human currency traders, as fewer trades executed via traditional systems means even less business and even more pressure to automate.

    To be sure, even after the “utility coin” system is up and running, a broader use-case could still be years away. As the FT notes near the end of the story, the coins can only be used to settle trades involving securities that are trading on a blockchain. While a few companies (notably Overstock.com) have successfully issued blockchain-based assets, it could be years – or even decades – before blockchain systems supplant the current market infrastructure.

    “Before the coins could be used for settling securities trades, he said the securities themselves will need to be transferred to blockchain systems, otherwise the benefits of speed and reduced capital requirements will be lost.”

    Assuming it happens at all. Even if the changeover were to be gradual, it would still require the cooperation of banks, exchanges, brokers, clearing houses etc. This remains unfeasible from a technology perspective. And even once blockchains can reliably achieve economies of scale, any kind of transition would probably take years.
     

  • CIA-Funded Washington Post Smears Indie Media For Covering DNC Fraud Lawsuit

    Authored by Caitlin Johnstone via Medium.com,

    The Washington Post, whose sole owner is both a CIA contractor and one of the wealthiest plutocrats of all time, has sent its Bezos-paid Ringwraiths after small independent reporters for having the temerity to talk about a lawsuit that had severe implications for the future of democracy in America.

    Back in May, comedian and Youtuber Jimmy Dore released a video titled “Washington Post Caught Blatantly Lying To Their Readers Yet Again” about one of the many, many deceptions that WaPo has been caught inflicting upon their unsuspecting audience. Dore pointed out that while corporate media reporters have long served as guard dogs for the establishment, in today’s environment where plutocratic CIA contractors can openly buy up media to advance blatant propaganda, those reporters have now become attack dogs for the establishment. As an example of this new breed of establishment attack dogs who go out of their way to smear and discredit all dissenting voices, Dore named amoral Bezos android Dave Weigel, who then spent months attacking both Dore and his writers.

    In a new article titled “In one corner of the Internet, the 2016 Democratic primary never ended”, big brave truth warrior Weigel used his massive platform to tear down writers and Youtubers who earn a fraction of his income because they reported on the DNC fraud lawsuit, which was dismissed last week.

    At no point in his insipid article does Weigel mention the Impartiality Clause of the DNC Charter, which was the central point of the fraud lawsuit and which the DNC was shown to have undeniably violated in such WikiLeaks releases as the conversations in the more egregious DNC emails, the Podesta emails showing that the DNC and the Clinton camp were colluding as early as 2014 to schedule debates and primaries in a way that favored her, and then-DNC Vice Chairwoman Donna Brazile acting as a mole against the Sanders campaign and passing Clinton questions in advance to prep her for debates with Sanders. DNC Chairwoman Debbie Wasserman Schultz was involved in all of these things, thus violating the promise the DNC made to the American people in its Impartiality Clause.

    Instead of addressing the lawsuit’s actual claims, Weigel opted to toss out a bunch of red herrings about voter roll purges and state elections officials to make the case that the DNC was not responsible for Sanders’ unfair treatment. But this baseless criticism was tangential to Weigel’s primary driving narrative, which was that independent reporters like HA Goodman and Tim Black belong to a marginal band of online kooks who ought to be scorned and ridiculed. At one point in the article he even argued that they should have spent more time covering the still completely unproven “hack” of the DNC rather than focusing on the contents of the WikiLeaks releases. Weigel’s whole piece revolved around his assigned task of discrediting alternative media, which is of course one of the most threatening enemies of the unelected power establishment that he works for.

    https://twitter.com/daveweigel/status/866700030417059841

    Weigel has attempted to argue on multiple occasions that it’s just a wacky, zany conspiracy theory to criticize his publication’s consistent violation of standard journalistic protocol by refusing to disclose its conflict of interest when reporting on the US intelligence community. If you find it at all suspicious that one of the most popular news publications in America downplays the fact that it is exclusively owned by a CIA contractor, you’re no different than someone saying the earth’s flatness is being suppressed by reptilian Illuminati. The second-richest billionaire in the world obviously bought the Washington Post in 2013 because he sensed that newspapers were about to enjoy a lucrative resurgence, you silly child.

    Come the fuck on. Jeff Bezos is not paying conscience-free ghouls like Dave Weigel to tear apart anti-establishment media because he thinks it’s a booming business venture. Jeff Bezos did not purchase one of the most respected newspapers in America for less than half the price tag of his CIA contract because he loves you and wants you to know the truth about things. Jeff Bezos purchased the Washington Post because he knows that the empire that he is building his plutocratic kingdom upon needs a robust propaganda mouthpiece.

    //platform.twitter.com/widgets.js

    Control of thought is more important for governments that are free and popular than for despotic and military states,says Noam Chomsky. “The logic is straightforward: a despotic state can control its domestic enemies by force, but as the state loses this weapon, other devices are required to prevent the ignorant masses from interfering with public affairs, which are none of their business…the public are to be observers, not participants, consumers of ideology as well as products.”

    That is why Jeff Bezos bought the Washington Post. In a corporatist system of government wherein corporate power is not separate from government power, corporate media is state media. It is propaganda. And for Jeff Bezos, only the best propaganda will do. He will continue to use his media arm to bolster the power establishment with which he is interweaving his massive corporatist kingdom, and he knows that winning the media war is an essential part of that agenda. Control the way Americans think and vote, and you’ll never have to worry about them interrupting your metamorphosis into a god.

    This shit right here is why I’m constantly talking about the importance of winning the media war. Enemies of humanity like Jeff Bezos know that the front lines of the battle against tyranny are not happening at the ballot box, nor in counter-protests against skinheads, but in the field of propaganda. Freeing mainstream America from the shackles of plutocracy necessarily means combating the mind viruses being dumped into their heads by toxic establishment war machines like the Washington Post.

    So please, support independent media, start creating your own independent media to the extent that you are capable, and help fight these bastards. Their propaganda machine remains the weakest point in their armor. We can take it down together. Keep fighting.

  • Who Leads The Autonomous Driving Patent Race? (Spoiler Alert: Not Who You Think)

    These days the broad consensus on the future of driving seems to be that the car of tomorrow will be (at least partly) autonomous. Many companies, including traditional car makers, suppliers and leading tech companies are currently working on self-driving technology, all eager to save themselves a piece of what they reckon will be an enormous pie.

    Many of these companies are already testing their tech on designated proving grounds for self-driving vehicles, but, as Statista's Felix Richter notes, for people outside the industry it’s hard to judge who is leading the autonomy race.

    One possible indicator for a company’s efforts in the self-driving vehicle segment is the number of patent filings in the field.

    Infographic: Who Leads the Autonomous Driving Patent Race? | Statista

    You will find more statistics at Statista

    The Cologne Institute for Economic Research identified and analyzed 5,839 patents related to autonomous driving to find out which companies are most active on that front.

    As the chart above illustrates, Germany’s traditionally strong car industry is keen to maintain its strong position in the future: 6 of the top 10 patent holders are German companies with Bosch, a key supplier of car manufacturers, leading the field.

    Google, widely considered to be a leader in autonomous driving research just makes the top 10 with 338 patents filed in its name between 2010 and July 2017.

  • Professor Explains Why We Can't Pre-emptively Strike North Korea: "North Would Turn South Into A Desert"

    Authored by Mac Slavo via SHTFplan.com,

    Following North Korea’s recent missile test, which ominously flew over Japan, the specter of war with the hotheaded nation was raised once again.

    As time goes on, it seems less and less likely that the Kim regime will back down from its nuclear program. All forms of diplomacy and appeasement have failed, and not even threats of war from the US seem to have an effect on the regime.

    There’s a very good reason for that. North Korea knows something that the United States, the most powerful nation on the planet, would absolutely hate to admit. Our country is is no position to engage in a preemptive strike on north Korea, because any attack would result in unimaginable devastation. The days when Americans would tolerate massive war casualties over a short period of time are long gone, and North Korea knows it. There simply isn’t anything we can offer or threaten that will stop their nuclear program.

    And that’s understandable once you know how much destruction North Korea could really bring about if the Kim regime ever decided to let its military loose on South Korea.

    If the current situation in East Asia is not resolved, a number of countries “will be living under a threat of a nuclear volcano erupting,” Russian diplomat and an expert in Asian studies, professor Georgy Toloraya told RT.com.

     

    Everyone understands perfectly well that for North Korea, if it initiates an aggressive strike, a military conflict will mean a complete and immediate destruction, because no one can deny the US military might,” Toloraya said.

     

    “However, for the US, attempts to solve this problem militarily also bring on a retaliatory strike by North Korea that would turn South Korea into a desert,” he warned, saying the North doesn’t even need nuclear weapons for that.

     

    While Pyongyang’s artillery is able to reach Seoul, the entire territory of South Korea will also “be no good for life,” as Pyongyang’s missiles – even without nuclear warheads – might hit nuclear facilities in the South, he explained. He said there are some 30 such sites close to North Korea’s border.

    Obviously, the destruction of nuclear facilities could have more of an impact than any other attack, by causing widespread radiation leaks. If anything, it could be more devastating than dropping a nuclear weapon, since the radioactive materials in these facilities often have a significantly longer half-life than what we see in atomic bombs.

    It’s threats like that which make it clear that no military option is capable of reigning in North Korea. That’s a sentiment that former White House Chief Strategist Steve Bannon expressed earlier this month.

    Contrary to Trump’s threat of fire and fury, Bannon said: “There’s no military solution [to North Korea’s nuclear threats], forget it. Until somebody solves the part of the equation that shows me that ten million people in Seoul don’t die in the first 30 minutes from conventional weapons, I don’t know what you’re talking about, there’s no military solution here, they got us.”

    And let’s not forget that North Korea has one of the largest chemical weapon stockpiles in the world, and is suspected of maintaining a bio-weapons program since the 1960’s. Given those possibilities, Bannon’s belief that North Korea could kill ten million people may be a gross understatement, and that doesn’t even consider the chances that war with North Korea could trigger another world war.

    It’s time to accept the truth. We can bargain with the Kim regime, appease it, threaten it, and lay down sanctions on it, but nothing will actually stop that government from continuing its nuclear program without causing mass casualties. The only thing we can do is try to keep a lid on that country until their citizens rebel, or until the Chinese decide that they’ve had enough with their ally.

  • Scientist Confirms: Harvey Caused A "1-In-1,000-Year Flood"

    Scientists have confirmed what one renowned weather forecaster has suspected for days: Hurricane Harvey was a “1-in-1,000-year flood.”

    That’s according to researchers at the University of Wisconsin’s Space Science and Engineering Center, who claim there is nothing in the historical record that rivals the devastation resulting from the flooding in southwest Texas, which has forced more than 30,000 Texans into temporary shelters.

    “There is nothing in the historical record that rivals this, according to Shane Hubbard, the Wisconsin researcher who made and mapped this calculation. “In looking at many of these events [in the United States], I’ve never seen anything of this magnitude or size,” he said. “This is something that hasn’t happened in our modern era of observations.”

    Of course, one reason for this might be that the modern urban environment is covered in concrete and asphalt, which makes it impossible for floodwater to absorb into the ground, exacerbating the disaster.

    Hubbard’s calculations, which he shared with the Washington Post, only accentuate the massive scale of the flooding.

    • At least 20 inches of rain fell over an area (nearly 29,000 square miles) larger than 10 states, including West Virginia and Maryland (by a factor of more than two).
    • At least 30 inches of rain fell over an area (more than 11,000 square miles) equivalent to Maryland’s size.

    To that, we’d like to add the nearly 52 inches of rain recorded by the National Weather Service in Cedar Bayou, Texas, which broke the continental U.S. record.

    Making matters worse, the National Hurricane Center (NHC) has just updated its forecast for what it is now referring to as a "rapidly intensifying" Category 2 hurricane in the Eastern Atlantic Ocean. Some models see the storm making landfall in Florida, while others see it landing somewhere in the Gulf of Mexico, meaning that another powerful storm could ravage Texas just two weeks after Hurricane Harvey, leaving locals little time to recover.
     

  • 'Supervolcano' Alert – Not Just In Yellowstone

    Authored by Robert Gore via Straight Line Logic blog,

    Thar she blows!

    Once every 600,000 years or so Yellowstone’s supervolcano erupts, making Mt. St. Helens, Pinatubo, and Krakatoa look like firecrackers. It blankets thousands of miles around it in lava and ash, casting a pall over the earth that lowers temperatures and hinders plant life for decades. Compared to Mother Nature we anthropogenic climate changers (if we are that) are pikers. Interestingly enough, that supervolcano is due for another eruption.

    Interestingly enough, so too is another supervolcano, one constructed entirely by humans. As to which erupts first, bet on the latter.

    Newton’s Third Law: For every action, there is an equal and opposite reaction. Coercion and violence generate a reaction, a countervailing pressure. They are historical constants, so like Yellowstone’s volcano, the pressure has been building for centuries, although not 6,000 of them. Like Yellowstone’s geysers, pressure-reducing steam has occasionally been released; coercion has abated and freedom briefly flowered. We know those periods as the times when progress mostly happened: the Renaissance, the Enlightenment, the Industrial Revolution. However, the twentieth century marked a resurgence of pressure.

    Their intellectual degradation complete, the coercive class meets any manifestation of countervailing pressure with still more coercion. The most pathetic case is the US government. Left at a zenith of power at the end of World War II, it has squandered its moral, military, and financial capital trying to squelch the forces that will inevitably topple its empire. After each disaster, it has sought new disasters. President Trump’s tripling down on Bush’s and Obama’s Afghanistan bets is yet another instance of the belief that force which fails can be “fixed” with more force.

    The reactive opposites are decentralization and individual autonomy. Individuals now have unprecedented capacities to wage violence, communicate, and compute. Since World War II governments are batting virtually zero trying to suppress insurgencies waged by guerrillas fighting on their home turf.

    Try as they might to suppress the Internet, they can’t go too far without severing their economies from the backbone of the information economy. Individuals perform computing feats on their smart phones that were beyond the capabilities of room-size computers fifty years ago. These are the forces pushing back against governmental centralization and coercion.

    Lately, not a day has gone by where an article hasn’t appeared arguing that the US government or the media or the globalists or some other nefarious entity is pulling the strings of some nefarious “divide and conquer” strategy. “Divide” needs no help from anyone. Unless humans develop the ability to split themselves, division has proceeded as far as it can go. A solitary soul can work, shop, eat, drink, find amusement and information, and do everything else necessary to sustain life without ever leaving his dwelling or coming into contact with another human being. Undoubtedly some do.

    Dividing is a done deal. Conquering is more problematic and in fact won’t happen. A government that’s sixteen years on in Afghanistan and hasn’t won a significant military engagement since World War II is going to have a bit of a problem either maintaining its faltering empire or subjugating its own well-armed population, half of which doesn’t like it very much, the other half expecting a perpetual payday. What if its creditors pull the charge card from the Empire of Debt?

    The same problems—imperial inefficiency and debt far in excess of the underlying economy’s ability to support it—will unexpectedly walk in on the globalists’ masturbatory fantasies. Governments at all levels have collectively plighted their troth to a spurious order maintained by force and fraud, resting on a supervolcano. The seismic portents have registered for decades. The Thousand Year Reich lasted twelve years, the Soviet Union sixty-nine. The Chinese government extended its life by rearranging its battery of forces, but the potential—so far successfully suppressed—counter-reaction leaves the rulers in a perpetual state of repressive anxiety.

    The western welfare states are beset by bankruptcy, unsustainable expectations, faltering economies, Brexit, Trump, separatist and secessionist movements, and pitched battles over campus speakers, statues, and whatever else triggers the triggered. These are akin to Yellowstone’s recent seismic swarms, and they’ll only get more numerous and intense.

    The list of irritations and grievances that can morph into confrontation and chaos is endless. It dawns on the debt-slave young that they are supporting their elders in a style to which they will never become accustomed. The productive tire of funding the unproductive and their government-sponsored rackets. Natives wonder why they should open their arms to migrants, especially those who hate them. Americans rebel against their government’s costly military interventions (okay, that one’s remote). Europe finds the Islamic chokehold increasingly choking and European manhood rediscovers its testicles (even more remote). It would be fitting if the first big morph came at some place like Davos or Jackson Hole.

    The think-tank terms for today’s tremors are “devolution” and “decentralization,” always characterized as threats. Supervolcanos take no prisoners. When this one erupts, it will obliterate the rickety superstructures of global governance, finance, and economic. The proper phraseology will be, “blown to smithereens”: the just and unjust, prepared and unprepared, wise and foolish buried under lava flows and choked by ashes, reality beyond a hand in front of one’s face impossible to make out amidst the smoke and haze. The beloved order of the ruling class giving way to entropic atomization.

    Atoms are life’s building blocks. Most everything worthwhile—family, community, trade, inquiry, innovation, production, progress—starts with individuals and builds. Most everything deleterious—repression, state-sponsored rapacity, tyranny, war—is imposed from the top by sociopaths masquerading as leaders. Bad as the supervolcano will be, it will blow this “top” to bits, giving the green shoots of decentralized freedom a chance to poke here and there through the ash. It’s about time.

  • Paul Ryan Draws Strength From Pelosi, Finally Condemns Antifa As "Left-Wing Thugs"

    In the days since Trump’s controversial press conference on the Charlottesville tragedy in which he said there was “blame on both sides,” Republicans have been tripping over one another to distance themselves from the White House.  Apparently the mere suggestion that Antifa, a Leftist group that has repeatedly incited violence at protests around the country, was anything more than an innocent bystander was grounds for impeachment, at least according to CNN, and just not something that Republicans in Congress were willing to touch.

    One such Republican that has been noticeably silent on the Antifa movement is none other than House Speaker Paul Ryan…that is until Nancy Pelosi took a stand and gave him the courage to actually express his own opinion…well, through a spokeswoman anyway.  Finally, after days of being heavily criticized for a failure to condemn violent Antifa attacks at Berkeley, Ryan’s staff issued the following statement to the Daily Caller last night:

    “Speaker Ryan believes, as is obvious, these individuals are left-wing thugs, and those who are committing violence need to be arrested and prosecuted. Antifa is a scourge on our country.”

    Paul and Nancy

     

    Of course, the statement sets a somewhat different tone when compared to Paul Ryan’s Facebook post from last week, entitled “Let There Be No Confusion,” which was clearly a shot at Trump.

    I still firmly believe this hate exists only on the fringes. But so long as it exists, we need to talk about it. We need to call it what it is. And so long as it is weaponized for fear and terror, we need to confront it and defeat it.

     

    That is why we all need to make clear there is no moral relativism when it comes to neo-Nazis. We cannot allow the slightest ambiguity on such a fundamental question.

     

    This is a test of our moral clarity. The words we use and the attitudes we carry matter. Yes, this has been a disheartening setback in our fight to eliminate hate. But it is not the end of the story. We can and must do better. We owe it to Heather Heyer, and to all our children.

    So why the sudden change of heart for Pual Ryan? 

    Maybe it’s related to the fact that his predecessor, Nancy Pelosi, managed to muster the political courage to denounce the hate group some 24 hours before him?  Per the Washington Times, Pelosi released the following statement on Antifa earlier this week:

    “Our democracy has no room for inciting violence or endangering the public, no matter the ideology of those who commit such acts.  The violent actions of people calling themselves antifa in Berkeley this weekend deserve unequivocal condemnation, and the perpetrators should be arrested and prosecuted.”

    Then again, maybe it was the main stream media’s cover that allowed Ryan the strength to acutally speak his mind…The Washington Post recently unleashed this shocking headline

    That was quickly followed by The Los Angeles Times…

     

    Then, The Atlantic…

     

    And, liberalist of them all, Bloomberg

     

    It seems as though America’s politicians learned nothing from the 2016 presidential election.  If nothing else, Trump’s campaign should have taught our pandering politicos that sometimes people actually like it when you speak your mind…apparently they’re slow learners.

    Alas, it does however seem as though Obama’s “lead from behind” strategy sunk in…so maybe politicians just learn lessons on a multi-year lag?

  • Come Melania's-Heels-Or-High-Water, 'Stupid News' Rules The Media

    Authored by David Weisberg via TheHill.com,

    Tropical Storm Harvey has by now flooded the Houston area with over four feet of rain, causing the deaths of more than 30 people, forcing more than 30,000 residents to flee their homes, and destroying property worth many tens of billions of dollars.

    Given the biblical proportions of the deluge, one would think that journalists would be hard-pressed to choose among an over-abundance of gripping and newsworthy stories.

    The New York Times and the Washington Post, two pillars of the journalistic establishment, have both identified one such story: the height of Melania Trump’s heels.

    I am not making this up; I couldn’t if I tried.

    Both newspapers recently featured stories focusing on the height of the heels the first lady was wearing when she boarded a helicopter to take her and the president to Air Force One, which would then fly them from Washington to Texas.

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    When she exited the plane in Texas, Trump was wearing sneakers, but that fact apparently did not diminish the newsworthiness — at least in the minds of the reporters and editors of those two august newspapers — of the heels she had worn earlier that day.

    We’ve encountered the phrase “fake news” quite often over the last year. There was, however, nothing fake about the stories that were published in the New York Times and the Washington Post: Trump was in fact wearing high heels. In that sense, the stories were genuine rather than fake.

    So, perhaps we need a new phrase. I would suggest “stupid news,” meaning that, even if the story is factually accurate, you would have to be stupid to think it was worth reporting.

    Just what is going on here?

    So-called mainstream news outlets are so determined to damage the image and reputation of the president and anyone associated with him that they will publish anything – literally anything – that, in the minds of their news and editorial leaders, might help to achieve that end.

    Even the pretense of fairness or objectivity has been abandoned; if a story might possibly damage President Trump, it will be published. “All the news that’s fit to print, including the stupid news.”

    Who exactly is the media serving with these stories? Whose interests are being served other than their own?

    In 1981, when then-Pres. Ronald Reagan was wheeled into the operating room after being shot by John Hinckley, he said to the surgeons, “Please tell me you’re Republicans.”

    It was light-hearted and humorous because the people he was addressing were all doctors, and everyone knows that doctors take an oath to do their utmost to heal every patient, regardless of their personal feelings toward the patient.

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    In fact, those lines of work that we think of as “professions” typically require that practitioners must put the interests of the people they serve above their own interests.

    Fledgling doctors and lawyers, at the beginning of their careers, pledge to put the interests of their patients and clients ahead of their own. Of course, those pledges are not always fulfilled as they should be, but professionals are subject to disciplinary measures when they transgress.

    Journalists and journalistic institutions are supposed to serve the interests of the people who consume their stories. Journalists don’t take any oath, but their readers expect them to use their best judgment in choosing the stories they write and the content they include. The editorial and opinion pages, as we all know, are different beasts. The news stories, however, are supposed to reflect what a competent and (dare I say?) professional journalist has learned about an important issue of the day.

    There were plenty of stories in the Times and the Washington Post that focused on important aspects of Harvey and also on other major news items. Not everything in those publications is “stupid news.” But some of the stories are just that.

    Sometimes little things say a lot. Stories about Melania Trump’s heels, published in the middle of a catastrophic event of almost unimaginable proportions, reveal much more about the media than they do about Mrs. Trump or the Trump administration.

    They reveal with startling clarity that certain journalistic institutions are hell-bent on damaging the current administration in any way they possibly can.

    And they reveal, in addition, that those institutions have abandoned the practice journalism as a profession; to them, journalism is just a job. They’re not committed to delivering high-quality stories to their readers, because that is what their readers expect and deserve.

    Rather, they’re committed to publishing anything that they think will damage the president and his administration, because they just don’t like this president.

  • 4 Reasons Why "Gold Has Entered A New Bull Market" – Schroders

    – 4 reasons why “gold has entered a new bull market” – Schroders
    – Market complacency is key to gold bull market say Schroders
    – Investors are currently pricing in the most benign risk environment in history as seen in the VIX
    – History shows gold has the potential to perform very well in periods of stock market weakness (see chart)
    – You should buy insurance when insurers don’t believe that the “risk event” will happen
    – Very high Chinese gold demand, negative global interest rates and a weak dollar should push gold higher

    This week gold broke through the key resistance of $1,300. For some time market commentators have been signalling this level as the point of entry for a new bull market.

    Often price can be distracting when it comes to trying to figure out what is going on. Two Schroders fund managers called the new bull market in gold about a week before the price broke through the key level.

    Gold has entered into a new bull market. As we have discussed previously, there are four main reasons for our stance:

    1. Global interest rates need to stay negative
    2. Broad equity valuations are extremely high and complacency stalks financial markets
    3. The dollar might be entering a bear market
    4. Chinese demand for gold has the potential to surge (indeed, investment demand in China for bar and coin already increased over 30% in the first quarter of 2017, according to the World Gold Council)

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Today’s News 31st August 2017

  • Armed Man Protects Flood Stricken Neighborhood From Looters

    Content originally published at iBankCoin.com

    The good news gleaned from this amateur footage taken by a woman who was afflicted by Hurricane Harvey was that someone had the heart to stand up to savage looters. The man featured below is self-described former law enforcement, holding down his neighborhood from these vile creatures.

    About midway through the video, the same woman made a claim that criminals were posing as rescue boat operators and robbing people. She said she was afraid to call for a rescue boar because of the robberies being reported. If true, this is one of the lowest form of thievery I’ve ever heard of — utterly disgraceful.

  • The Fake News Media Of Sweden

    Authored by Nima Gholam Ali Pour via The Gatestone Institute,

    • In most democratic countries, the media should be critical of those who hold power. In Sweden, however, the media criticize those who criticize the authorities. Criticism is not aimed at the people who hold power, but against private citizens who, according to the journalists, have the "wrong" ideas.
    • TV4 and all other media refused to report that it was Muslims who interrupted the prime minister because they wanted to force Islamic values on Swedish workplaces. When the Swedish media reported on the event, the public were not told that these "hijab activists" had links with Islamist organizations. Rather, it was reported as if they were completely unknown Muslim girls who only wanted to wear their veils.
    • The Swedish media are politicized to the extent that they act as a propaganda machine. Through their lies, they have created possibilities for "post-truth politics". Instead of being neutral, the mainstream Swedish media have lied to uphold certain "politically correct" values. One wonders what lifestyle and political stability Sweden will have when no one can know the truth about what is really going on.

    In February 2017, after U.S. President Donald Trump's statements about events in Sweden, the journalist Tim Pool travelled to Sweden to report on their accuracy. What Tim Pool concluded is now available for everyone to watch on YouTube, but what is really interesting is how the Swedish public broadcasting media described him.

    On Radio Sweden's website, one of the station's employees, Ann Törnkvist, wrote an op-ed in which Pool and the style of journalism he represents are described as "a threat to democracy".

    Why is Pool "a threat to democracy" in Sweden? He reported negatively about an urban area in Stockholm, Rinkeby, where more than 90% of the population has a foreign background. When Pool visited Rinkeby, he had to be escorted out by police. Journalists are often threatened in Rinkeby. Before this incident, in an interview with Radio Sweden, Pool had described Rosengård, an area in the Swedish city of Malmö heavily populated by immigrants, as "nice, beautiful, safe". After Pool's negative but accurate report about Rinkeby, however, he began to be described as an unserious journalist by many in the Swedish media, and finally was labeled the "threat to democracy."

    One might think that this was a one-time event in a country whose journalists were defensive. But the fact is that Swedish journalists are deeply politicized.

    In most democratic countries, media are, or should be, critical of those who hold power. In Sweden, the media criticize those who criticizes those who hold power.

    In March 2017, the public broadcasting company Sveriges Television revealed the name of a person who runs the Facebook page Rädda vården ("Save Healthcare"). The person turned out to be an assistant nurse, and was posting anonymously only because he had been critical of the hospital where he worked. Swedish hospitals are run by the local county councils, and thus when someone criticizes the healthcare system in Sweden, it is primarily politicians who are criticized. Sveriges Television explained on its website why it revealed the identity of the private individuals behind Facebook:

    "These hidden powers of influence abandon and break the open public debate and free conversation. Who are they? What do they want and why? As their impact increases, the need to examine them also grows."

    It is strange that Sveriges Television believes that an assistant nurse who wants to tell how politicians neglect public hospitals, is breaking "the open public debate and free conversation". This was not the only time that the mainstream Swedish media exposed private citizens who were criticizing those who hold power. In December 2013, one of Sweden's largest and most established newspapers, Expressen, announced that it intended to disclose the names of people who commented on various Swedish blogs:

    "Expressen has partnered with Researchgruppen. The group has found a way, according to their own description, without any kind of unlawful intrusion, to associate the usernames that the anonymous commentators on the hate websites are using to the email addresses from which comments were sent. After that, the email addresses have been cross-checked with registries and authorities to identify the persons behind them."

    The term "hate websites" (hatsajterna) is what that the mainstream media uses to describe some of the blogs that are critical of Islam or migration.

    It is one thing to be critical of bloggers who you may consider have racist opinions. But exposing the people who have written in comments sections of various blogs in one of Sweden's biggest newspapers is strange and terrifying.

    Researchgruppen has clear links to Antifascistisk Aktion (Antifascist Action), a group which, according to the Swedish government, consists of violent left-wing extremists. For their efforts to expose private individuals in the comments section, Researchgruppen received the Guldspaden, a prestigious journalistic award in Sweden.

    Jim Olsson was one individual exposed in Expressen simply because he wrote something in a blog's comments section. A 67-year-old docent in physical chemistry, Olsson received a home-visit from Expressen with a camera and microphone present. A private citizen with no connection to any political party or organization, he exposed by Sweden's media because he had written the following in the comments section:

    "The Swedish asylum system rewards swindlers with a permanent residence permit. There are, of course, swindlers flooding Sweden."

    The Swedish newspaper Expressen accessed databases of website commenters, targeted critics of immigration, and confronted them at home. The above screenshot is taken from a video on the Expressen website, published under the headline "Jim Olsson writes on hate sites."

    Another private individual, Patrik Gillsvik, with no political links, was exposed and fired from his job because, in a blog's comments section, he wrote:

    "I would like to join the structural prejudices of the majority in society and state that gypsies are inventive and witty entrepreneurs who can enrich our culture — yes, and then they steal like ravens, of course!"

    Although the statement can be criticized for being unacceptably racist, what is unique is that the mainstream media in a Western democracy can expose private individuals because they wrote something in a blog's comments section. Criticism is not aimed at the people who hold power, but against private citizens who according to the journalists have the "wrong" ideas.

    Moreover, each of these private citizens, who have had their lives ruined because they wrote something distasteful in a comments section, serves as a warning, so that others will not dare to make the mistake of posting something politically incorrect on a blog.

    It is shocking that in a democracy, the media acts this way, but that is how Swedish — and, increasingly, other Western media — operate these days.

    In addition to punishing private individuals who, according to the them, communicate "wrong" ideas, the media celebrate and support people who have the "right" ideas. On May 1, 2017, Sweden's Prime Minister Stefan Löfven was interrupted by a number of hijab-wearing activists who were protesting a verdict of the Court of Justice of the European Union that employers are entitled to prohibit staff from wearing a hijab. Given that Sweden's prime minister cannot directly influence the Court, and that one should not interrupt the country's prime minister when he speaks, one would think that these "hijab activists" might be criticized in the media.

    TV4, a national TV-channel and one of the first media outlets to report this incident, refused to say that those who interrupted the prime minister were wearing the Islamic veil. The title of TV4's clip was "Demonstrators Interrupted Löfven speech". The sub-headline read as follows: "Female protesters screamed out their anger against the prime minister and wondered where the feminist government was."

    From the text, it is not clear that these activists demonstrated against the verdict of the Court of Justice of the European Union; that all activists wore a hijab, or that they screamed, "Stand up for Muslim women's rights!" However, information that these activists were wearing hijabs and protesting the verdict of the Court of Justice of the European Union was on their Facebook page and YouTube. Nevertheless, TV4 and all other media refused to report that those who interrupted the prime minister were Muslims who were interrupting the prime minister because they seemingly wanted to force Islamic values on the Swedish workplace.

    The day after their protest, in an interview with Radio Sweden, these activists had the opportunity to explain why they protested — but were not asked any critical questions. The next day, an Expressen columnist, Maria Rydhagen, compared one of the hijab-activists glowingly with one of the founders of the Swedish Social Democratic Party, Axel Danielsson. Rydhagen wrote the following about Jasmin Nur Ismail:

    "Then, on Monday, the protest of the girls was perceived as only an incident. But imagine if it was the start of something big? Perhaps history was being written, there and then? Imagine if Jasmin Nur is the Axel Danielsson of 2017. Hero and rebel. In that case: Was it not a pity to remove her with the help of the police?"

    As the media refused to write anything negative about the protest against the prime minister, this author began to investigate the matter. It took half an hour to find out several important things which were never mentioned by the Swedish mainstream media. Jasmin Nur Ismail had written about the incident on her Facebook page shortly after the protest. Who was behind the protest was not a secret.

    The demonstration had been organized by the Hayat Women's Movement and a network called, "The Right to Our Bodies". The Hayat Women's Movement was founded by Aftab Soltani, who in March 2017 was one of the speakers at a much-criticized annual Islamic event in Sweden, Muslimska Familjedagarna (Muslim Family Days). The event was blamed by both the left and the right for inviting hate preachers, anti-Semites and Muslim radicals as speakers. Another speaker at this Islamic event in March 2017 was Jasmin Nur Ismail, a heroine of the Swedish media. Muslimska Familjedagarna was organized by the Islamist Ibn Rushd Educational Association, the Islamic Association of Sweden (Islamiska Förbundet i Sverige) and Sweden's Young Muslims (Sveriges Unga Muslimer).

    Jasmin Nur Ismail, hailed as a heroine in Expressen, is a public figure. Southern Sweden's largest newspaper, Sydsvenskan, described her in an October 2016 article as an "activist, anti-racist and writer". According to Sydsvenskan, Jasmin Nur Ismail's political role-model is Malcolm X. During the Swedish Forum for Human Rights in 2016, Jasmin Nur Ismail was, in a panel discussion, the representative for Malmö's Young Muslims — in turn, a subdivision of an Islamist organization, Sweden's Young Muslims.

    Swedish newspapers did not write a single word that the person and organizations behind the protest against Sweden's prime minister had links with Islamist organizations. When the Swedish media reported about the event, the public were told that these hijab-activists were completely unknown Muslim girls who only wanted to wear their veils.

    Mainstream Swedish media outlets simply do not report some things. When the largest mosque in Scandinavia was opened in Sweden's third largest city, Malmö, the news about this was first published in the Qatar News Agency and The Peninsula on May 3, 2017. The reason that Qatar's media wrote about it was because Qatar financed a large part of the mosque. On May 5, an article about this mosque was published in Breitbart. On May 6, one day after Breitbart reported the news and three days after the Qatari media reported the news, the Swedish terrorist expert Magnus Ranstorp sent a tweet about this mosque, but he linked it to the Qatari media. At this time, there are still no Swedish media outlets that have reported anything about the largest mosque in Scandinavia.

    On May 8, the Swedish blog Jihad i Malmö wrote about the mosque and its Qatari financing. On May 9, the Swedish blog Pettersson gör skillnad wrote about the mosque. At the same time, the Norwegian author and activist Hege Storhaug, who is critical of Islam, wrote about the mosque and noted that the Swedish media had not yet written about it:

    "I had expected that the Swedish media at the very least would mention the opening of Scandinavia's largest mosque with positive words. But no, not a word in Swedish mainstream media, as far as I have noticed. You have to go to the English version of Arabic media to get some limited information, like Qatar News Agency."

    By the time I tweeted about it on May 10, the mainstream Swedish media still had not widely reported it. On May 15, I wrote an article on it for the news website Situation Malmö, run by the Sweden Democrats party branch in Malmö. With one hour's research, I managed, through what the mosque had published on Facebook, to discover that one of the leading Social Democrat politicians in Malmö, Frida Trollmyr, a municipal commissioner with responsibility for culture, recreation and health, had been at the mosque's opening. Representatives of the Qatari government also attended, but the mainstream Swedish media still had not reported anything about it.

    On May 17, two weeks after the Qatari media had written about the opening of Scandinavia's largest mosque in Malmö, 12 days after Breitbart had written about the event, and two days after my article, the Sydsvenskan newspaper wrote about the mosque opening. You could not read the article, however, if you had not paid for "premium membership" to this newspaper.

    One can see this omission as an unfortunate coincidence, but it is strange when Breitbart succeeds in communicating more information about Malmö than southern Sweden's largest newspaper, which is headquartered in Malmö. Why would the Swedish media not write about the mosque? It was certainly not a secret. There was no explanation from the Swedish media or anyone else. Yet, these same media outlets did not hesitate to expose the names of private citizens who wrote inappropriate opinions on a public comments page.

    There are journalists in Sweden who change their views as soon as the government changes its opinion. Göran Greider, a journalist and editor, active in the public debate in Sweden for more than 30 years, wrote the following in August 2015, about migration policy:

    "The European governments who say no to increasing the number of refugees received not only show a shameful lack of solidarity. They are also silent when they decline to rejuvenate their populations."

    In November 2015, only three months later, when the Swedish government was forced to change its migration policy because of the migration crisis, Göran Greider wrote:

    "But even the left, including many Social Democrats and members of the Green Party, have sometimes been characterized by an unwillingness to discuss the great challenges that receiving refugees, in the quantity we have seen lately, implies for a society. No one wants to be a nationalist. No one wants to be accused of running the errands of Sweden Democrats, or racism. But in this way, people on the left, who are so broadly for bringing in refugees, have often locked themselves out of a realistic discussion."

    There is nothing wrong in reconsidering one's opinion. But it has become common for Swedish journalists frequently to have opinions that favor certain political parties — often the Social Democrats, the Left Party and the Green Party. The issue is not even about values. People who work for the mainstream Swedish media are ready to reconsider their values so long as it helps certain parties to stay in power. This is far from what is presumably the media's main task in a democracy.

    How is it that no newspaper is rebelling against this order? It would be a good business proposition; such a media outlet could gain financial benefits. Sweden's political establishment is, after all, not popular. Well, we can look at the example of someone who tried. In February 2017, a financier, Mats Qviberg, bought a free daily newspaper, Metro, usually distributed in subways and buses in Sweden. In May, he gave an interview to the newspaper Nyheter Idag, considered by the Swedish establishment to be "right-wing" or "populist". In his interview, Qviberg gave a slight playful hint that Metro might in some way cooperate with Nyheter Idag.

    The consequence of the playful statement was that the Green Party in Stockholm County Council threatened that Stockholm County would stop handing out Metro in Stockholm's subways. A columnist stopped writing for the paper. Other media outlets started to wonder out loud if Metro were becoming a racist platform. Before the month of May was over, Qviberg had sold his shares in Metro. That politicians would punish a newspaper owner who had "wrong" views did not surprise anyone in Sweden; the situation was not worth mentioning. In Sweden, even owners of newspapers are supposed to follow the political order.

    In June 2017, the leader of the Sweden Democrats (SD), Jimmie Åkesson, spoke in Järva, a district in Stockholm dominated by immigrants. The Sweden Democrats is a social-conservative party in the Swedish parliament; it supports, among other matters, a restrictive migration policy. While Åkesson was speaking, there were protests against him; and among the protesters were various placards. A photograph of Radio Sweden's van showed an anti-SD placard inside it. On it, one could read "Jimmie = Racist". The explanation from Radio Sweden was:

    "Someone put a sign on Ekot's (a Radio Sweden news program) car in Järva on Sunday evening. It was taken down and put into the car and then thrown away on the way from there."

    You can have a discussion about why Radio Sweden spends its time discarding placards that left-wing protesters use. Is that what journalist are supposed to do when they are covering a story? In the end, however, it does not matter. The people's confidence in the mainstream media in Sweden is being eroded as we write.

    A new study from Institutet för Mediestudier shows that 54% agree, or partly agree, that the Swedish media are not telling the whole truth about problems in society linked to migration. Instead of the media accepting that they are biased and starting to change their ways, the media continue to attack citizens who appear critical.

    In June 2017, the editorial writer of the daily Aftonbladet, Anders Lindberg, wrote an editorial titled, "Hitler Did Not Trust the Media Either," in which he equated the critics of the Swedish media with Nazis. Anders Lindberg, after working 10 years for the Social Democrats, resigned as the Communications Ombudsman for the Social Democrats in 2010, to start working as an editorial writer for Aftonbladet. He is so well-known for what his critics view as unusual versions of the truth that he has the privilege of writing for Sweden's largest newspaper. In 2015, he described the issue of organized begging, a visible problem in northern Europe, as "legends and folklore". Today there is no party that denies that organized begging is a real problem.

    I often have difficulty explaining to many of my American friends and colleagues how the Swedish media work. Often, there may be clear examples of anti-Semitism and other unsavory behavior. The first question I always get is: Why is the media not writing about this? The answer is simple. The Swedish media are politicized to the extent that they act as a propaganda machine. It is not a propaganda machine in the traditional sense of the word, with an official Ministry of Propaganda. But in Sweden, many journalists and editors are either old established political party employees, as Anders Lindberg, or simply ideologically indoctrinated and therefore extremely biased. The Swedish propaganda machine punishes those who have the "wrong" opinions and celebrates those who have the "right" opinions.

    What happened to Tim Pool was a part of how media works in Sweden. As long as he said the "right" things, the Swedish media gave a positive picture of him. When he started to have the "wrong" opinion, the propaganda machine started doing its work and Pool became "a threat to democracy".

    There are, of course, more examples that show how sick the Swedish debate- and media-climate has become. In such a negative environment, there are many casualties. The first casualty is, obviously, the truth. When people start to understand that the mainstream media are lying, they turn to alternative media. Alternative media outlets, however, also usually have political agendas. A democracy cannot survive well only on biased media. A democracy desperately needs mainstream media outlets that inform its citizens and criticize people who hold power. That is something Sweden does not have today.

    A large portion of the Swedish population are apparently aware of this and do not trust the media. Through its lies, the Swedish media have created possibilities for "post-truth politics" in Sweden. Instead of being a neutral party, the mainstream Swedish media have lied to uphold certain "politically correct" values. The result is an atmosphere where many people believe that everything that the media says has a political agenda. When the mainstream media in Sweden lie shamelessly, where can one go to find the truth? One wonders what lifestyle and political stability Sweden will have when no one can know the truth about what is really going on.

  • Cyber-Criminals Abandon Bitcoin; Homeland Admits "It's A Lot More Legitimate Than People Think"

    Regulators in the US, Europe and Asia who’ve sought to crack down on bitcoin – many of these regulators are also proponents of a “cashless society” – have been dealt a stunning setback by an unlikely defender of the pioneering digital currency: The US Department of Homeland Security.

    To wit, one anonymous DHS source told CNBC that bitcoin has become “a lot more legitimate” than many believe.

    "We're getting a lot better through law enforcement tracking those [criminals] and holding the exchanges more accountable," the Homeland Security official said. "I think [bitcoin]'s a lot more legitimate than people give it credit for."

    Another source told CNBC that criminals have backed away from using the digital currency as bitcoin transactions have become much easier for authorities to trace. Earlier this month, the IRS announced that it had developed, with the help of bitcoin security firm Chainalysis, a tool to unmask the owners of bitcoin wallets.

    “Although hard numbers on criminal activity in digital currencies are difficult to pin down, Shone Anstey, co-founder and president of Blockchain Intelligence Group, estimates that illegal transactions in bitcoin have fallen from about half of total volume to about 20 percent last year.

     

    "Now it's significantly less than that," he told CNBC earlier this month, noting that overall transaction volume has grown globally.”

    Bitcoin is vulnerable to law enforcement because each user must display a public ID, a complex cryptographic combination of numbers and letters, in order to tansact in bitcoin. By tracing the movement of coins between accounts, CNBC explains, intelligence and security agencies can follow the money and arrest the criminals when they try to withdraw their ill-gotten games in US dollars, or another fiat currency.

    Last month, US authorities partnering with Interpol and local law enforcement shut down AlphaBay and Hansa, two of the largest dark-web marketplaces for drugs and illegal goods. Before that, they took down BTC-E, a shadowy digital-currency exchange, arrested its Russian-born founder and seized the company’s website.

    Another cybersecurity expert who spoke with CNBC noted that, when a user tries to convert bitcoin into cash, the digital-currency’s veneer of anonymity disappears.

    "Bitcoin basically introduced a situation where we could bypass the money mules," said Rickey Gevers, cybercrime specialist at RedSocks Security, which detects and fights against malware.

     

    But, Gevers said, "in the beginning [bitcoin] looks very anonymous, and in the end it doesn't look very anonymous."

    Paul Triolo, a consultant at Eurasia Group, said bitcoin has “changed quite a bit” since it was first launched in early 2009. It’s now primarily used by legitimate investors, not dark-web criminals.

    "The whole use issue of digital currencies has become a big industry. Bitcoin isn't this weird, odd currency that's being used on the dark web," said Paul Triolo, practice head of geotechnology at consulting firm Eurasia Group.

     

    "Since the early days of bitcoin on some [levels], the world has changed quite a bit."

    Instead of bitcoin, the DHS told CNBC it’s focusing on other cryptocurrencies like Ethereum and Monero. For those who are unfamiliar with the latter, it’s one of a handful of digital currencies featuring enhanced privacy controls. For example, Monero scrambles a user’s public ID, making it more difficult for authorities to trace transactions.

    Even the European Union admitted that bitcoin was never popular with organized crime groups, which overwhelmingly prefer payment in large-denomination bills like the 500-euro note, production of which has been discontinued by the ECB, part of the European elites' war on cash.

    Still, global authorities remain skeptical. Earlier this week, Russia signaled an about-face when the country’s deputy finance minister told local media that the ministry of finance and central bank were seeking to “regulate” digital currencies by forcing users to execute trades on the country’s public stock exchange, allowing the government to monitor transactions.

    In the US, the SEC decreed last month that digital currencies are financial securities that must be registered with the agency. However, the ultimate significance of the agency's ruling remains unclear.

  • Brandon Smith: "Sorry, Joe Biden – The 'Soul' Of America Is Conservative"

    Authored by Brandon Smith via Alt-Market.com,

    Some political figures truly embody the classic role of the divider; their purpose seems to be to agitate and provoke, to instigate conflict rather than mediate peace. Al Sharpton and Nancy Pelosi come to mind. Let's not forget John McCain or Lindsay Graham. Barack Obama was known as the "great divider" for much of his presidency. While many leftists would argue that Donald Trump is the "most divisive" president in generations, I think the mainstream media has proven far more provoking than he has. In the case of Charlottesville, we see a whole host of individuals and institutions seeking to promulgate continued social tensions well beyond anything Trump has done. One of these individuals is Joe Biden.

    In a short essay for The Atlantic, Joe Biden was quick to capitalize on the death of a protester in Charlottesville at the hands of an apparent white nationalist, spewing forth a host of cliches on "dark forces" creeping out from the hidden corners of America to smother the light and happiness of the silent Kumbaya majority like some kind of J.R.R. Tolkien novel.

    This narrative is nothing new. It is the narrative that was promoted throughout the 2016 presidential election cycle as well as the Brexit debate in the U.K. – the notion that dangerous and "ignorant" portions of the citizenry in western society (labeled "populists") are quietly organizing for a last stand against the "inevitable evolution" of progressive multiculturalism and globalism. They are presented as the throwbacks, the cave people, the Cro-Magnons, the people who refuse to get with the times and embrace the social justice revolution.  They are, according to gatekeepers like Biden, in the way.

    While a host of names and labels are used to define this group of malcontents preventing society from achieving full-blown Utopia, we all know who establishment snake oil peddlers are really referring to: conservatives.

    The racism subplot to this scripted conflict has always been present. When the vote on the U.K. exit from the European Union proved successful, the automatic accusation in the media was that this was driven by "hidden racism," along with the consistent idea that older generations were trying to live off the backs of younger generations while interfering with "natural" shifts in cultural consciousness. These claims were greatly amplified during the rise of the Trump administration.

    I have to say, these assertions are fascinating to me. The amount of propaganda and projection involved is truly staggering.

    Biden's hope along with other establishment con-men, I believe, is that he can continue to simplify the narrative down to a series of false associations. White nationalists were present at Charlottesville? Indeed. White nationalists were standing in defense of the confederate statue issue? Yes. White nationalists faced off against Antifa counter-protesters? Certainly. A white nationalist drove his car into a group of counter-protesters and killed one of them? It would seem so, though I still think the man deserves a fair trial before being convicted in the media. But here is where Biden and his ilk deliberately go off the rails in order to incite wider tensions…

    At this point, the narrative moves from facts to wild assumptions and misconceptions. White nationalists were present in Charlottesville, but does this mean everyone (or even most people) in Charlottesville protesting in defense against the removal of confederate statues was a racist? No. Does this mean that people who support the existence of confederate statues are automatically racists? No. Does this mean that anyone that stands in opposition to groups like Antifa is a racist or a fascist? No. Just because one man acted violently in response to Antifa and other leftists groups, does this mean that Antifa represents the "good guys" in Biden's little screenplay? No.

    But this is the story we are being sold. Not just by Biden, but by many other political interests.

    I would specifically reference a recent panel of Trump supporters by CNN, during which the "journalist" was dismayed to discover that none of the people involved was willing to play along with the message that Donald Trump's response to Charlottesville was anything other than logical.

    I want readers to take note of a specific assertion made by CNN, as well as Biden, here – the assertion that it is the job of leftist groups like Antifa to "fight" or even destroy "hate groups" or "fascist groups." CNN outright compares Charlottesville to World War II, claiming that because the allies were justified in going to war with Nazis back then, that Antifa is justified in going to war with "Nazis" today. But again, when you consider the reality that Antifa and similar groups associate all conservatives with fascism, this narrative opens the door to a level of intolerance and violence that is unacceptable and also misplaced.

    Beyond that, it seems to me that CNN, Biden and others are happily supporting the false assumption that "hate speech" is not protected speech in America. I don't personally care for the white nationalist platform, being that skin color and genetic background is ultimately irrelevant, and as I noted in my last article, some of these groups end up being led by government paid provocateurs. But these groups still have the Constitutional right to protest grievances in public spaces. It does not matter how distasteful one person or another finds them to be.

    Laughably, Biden spends the majority of his diatribe in The Atlantic admonishing the very existence of these groups as if they are a threat to the constitution. Stating:

    "The giant forward steps we have taken in recent years on civil liberties and civil rights and human rights are being met by a ferocious pushback from the oldest and darkest forces in America. Are we really surprised they rose up? Are we really surprised they lashed back? Did we really think they would be extinguished with a whimper rather than a fight?

     

    Today we have an American president who has publicly proclaimed a moral equivalency between neo-Nazis and Klansmen and those who would oppose their venom and hate.

     

    We have an American president who has emboldened white supremacists with messages of comfort and support

     

    ….This is a moment for this nation to declare what the president can't with any clarity, consistency or conviction: There is no place for these hate groups in America. Hatred of blacks, Jews, immigrants – all who are seen as "the other" – won't be accepted or tolerated or given safe harbor anywhere in this nation."

    Biden has the audacity to concoct this fallacy and then associate it with the "defense of the constitution" at the end of the article.  I guess the "medal of freedom" he received as a surprise gift from Barack Obama was just a meaningless trinket after all.

    I don't know that anyone claimed a "moral equivalency" between racists and people opposed to racism. That is not what the confederate statue issue is about anyway. What I do know, though, is that under the law every group present at Charlottesville had a Constitutional right to be there, regardless of how Biden or others view their "morals."

    I would point out that many people, myself included, actually find the communistic fanaticism of Antifa and other social justice groups to be a much greater threat to the freedom and stability of our nation than anything white nationalist groups promote. But many conservatives, myself included, still defend Antifa's right to free speech in public places as long as they do not interfere in the free speech rights of others. This is something leftist groups are not willing to do. These groups should be thanking their lucky stars for conservatives and conservative principles, otherwise they might have been stomped out of existence a long time ago. It is conservative thought that defends the rights of any group or individual, acting in accordance with the law, to speak freely in public forums.

    It is conservative thought that defends the speech of Antifa. It is conservative thought that defends the existence of confederate statues. And yes, it is conservative thought that defends the speech of white nationalists and many others. This does not mean we necessarily agree with any particular group's position.  The nature of the speech is irrelevant. In this kind of open social environment, ideas can do battle, rather than people. When one group begins to assert preeminence and says the speech of others is now unprotected, the door is opened wide to battles between people, rather than ideas.

    If a person does not agree with certain views, they can always go back home, or back to their own private websites and forums. But, as soon as they enter the public sphere, they are not entitled to insulation from the ideas of other people.

    What Biden and others are championing is at bottom the ideology of "futurism," a movement launched in Europe and Russia in the early 20th Century driven by violent change or extermination of traditional principles. Futurism is often credited as being a precursor to both fascist and Bolshevist political movements (as well as globalism), and its core mantra is that all "new" ideas and systems must take precedence over old ideas and systems. New generations must advance the dominance of their ideologies over older generations. Heritage must die out. Traditions must be abandoned. Progress must be pursued.

    The problem is, there are very few "new" ideas in the world. In cultural terms, society is cyclical. The same ideas come and go over the centuries; rehashed and rebranded, but certainly not new. What Antifa represents is classic communism and cultural Marxism. These are old ideals. The destruction of a nation's history and heritage in the name of expedient political progress and "social justice" is a classic strategy turned into a science by the likes of Lenin and Mao. And this strategy is merely an extension of one of the oldest ideas ever — collectivist tyranny.

    If we are to be honest here, the conservative philosophy of individual freedom and Constitutional liberty as a foundation of political life is the newest of ideas to be adopted by any culture in human history.

    When we examine the mindset of the average American, there is definitely a sizable division.  But, one thing the vast majority of us agree on is that government power is not to be trusted.  Only 20% of Americans today believe the government will "do what is right" most of the time.  The largest ideological group in the US according to recent polls continues to be conservatives.  Conservative principles of limited government and individual liberty are the bedrock upon which America was founded.  While many Democrats (and some Republicans) will insist upon larger government as the solution to all our societal ills, this is predicated on the notion that THEY are in control of that government.  Place a host of Republicans in seats of power in Washington and the liberals become just as distrustful of the establishment as any hardcore libertarian (aka – true conservative).

    You see, the fact is that most people are really conservative at heart until they think they have the reins of government in their hands.  What Biden and other establishment elites want is to use government power as a temptation; a prize that will corrupt anyone that attains it and alienate anyone that doesn't.  In the case of his Atlantic article, Biden is luring leftists into stupidity and ruin.  Biden WANTS domestic strife and conflict.  He wants the left to believe they are fighting a righteous fight when they on the wrong side of history not to mention nothing more than cannon fodder.  And they think he is actually on their side…

    Biden claims that today we are in a battle "for America's soul," but the reality is that establishment elites and the useful idiots they employ are seeking to suffocate the soul of our nation so that they can build their own vision on top of the ashes. This is what futurists do. This is what communists and fascists do. This is what globalists do. America has survived as long as it has because some ideas never become outdated. The Bill of Rights and the Constitution itself are merely the legal embodiment of the eternal principles of natural law and individual liberty. What is new is the idea that these principles must be protected by government, that they actually RESTRICT government, and that, in fact, the only job government should really be concerned with is to ensure the continuation of these restrictions on leadership and these freedoms for citizens.

    This is conservative. This is the soul of America. You cannot call for the exact opposite and still claim you are a champion of America's soul.

  • If Korean War Breaks Out, Seoul Will Send Special Forces To Assassinate Kim Jong-Un

    Confirming reports that first floated several months ago, the Telegraph reports that South Korea is preparing to send special forces units into Pyongyang to conduct a “clinical strike” – searching for, and taking out Kim Jong-un and his closest advisers, in the event that North Korea should start a conventional war. The plan is among the revisions being made to South Korea’s latest strategy for dealing with an attack from the North.

    Senior officials briefed South Korea’s president, Moon Jae-in, about revisions to the present defence of the nation on Monday, one day before North Korea launched an intermediate-range ballistic missile over Japan. Moon told the ministry to implement reforms to the military to meet the challenges that are increasingly being posed by North Korea. He added that the military should be ready to “quickly switch to an offensive posture in case North Korea stages a provocation that crosses the line or attacks the capital region”, the Chosun Ilbo newspaper reported. The prime minister also requested that the military “increase its mobility as well as its ability to carry out airborne and sea landings” and upgrade air defences.


    South Korean army soldiers during the annual Ulchi Freedom Guardian exercise

    Meanwhile, this is what a “hot” war attack by Pyongyang could look like from the South Korean perspective:

    • In the event of a conventional conflict breaking out on the Korean Peninsula, North Korean artillery is expected to bombard the South’s defences along the Demilitarised Zone as well as shelling Seoul, which is less than 50 miles south of the border.
    • Massed tanks and infantry units, assisted by saboteurs and agents already in the South, would attempt to swiftly seize Seoul and other key cities and facilities in South Korea before the United States and, potentially, other allied nations could land reinforcements.

    In retaliation, under the existing US-South Korean plan for the defence of the South, known as OPLAN 5015, the two nations would aim to bring their overwhelming air and naval superiority to bear from bases in South Korea and Japan, as well as aircraft carriers in the western Pacific, although it would take weeks before large-scale reinforcements, including heavy tanks and other equipment, could be landed.

    Furthermore,as the following naval map as of August 24 shows, in practical terms there is no carrier support around the Korea penninsula, so at least one aspect of the theoretical plan is currently impossible.

    The new South Korean plan will identify more than 1,000 primary targets in North Korea to be eliminated by missiles and laser-guided munitions – including nuclear weapons and missile launch facilities – at the same time as the conventional attack is halted.


    South Korea’s F-15K jets drop bombs during training at Taebaek Pilsung Range

    Additionally, the military has been tasked with training special forces units that could be infiltrated into Pyongyang in order to target key members of the regime, including Kim Jong-un, the North Korean leader, in order to bring about a more rapid conclusion to the fighting. While on paper such a “decapitation” move appears enticing, in reality the retaliation by the crippled NKorean regime against its southern neighbor, especially once it has lost its leader, would likely result in countless casualties and serve as the start of a gruesome regional, if not world, war.

  • What Happened To Making America Great Again?

    Authored by Curt Mills via The National Interest,

    With Steve Bannon out of the White House, regrets are abounding in some corners of the right over how President Trump staffed his administration.

    As a candidate Donald Trump excoriated his party’s reigning orthodoxies. As president, however, he is running a fairly conventional administration in his first seven months, at least in the policy realm. What happened to making America great again?

    The truth is that the new movement had troubling signs from the beginning. “People who went all-in for Trump were engaged in total wishful thinking,” complains one former Trump campaign policy adviser. According to him, “I think that in his gut Trump isn’t wedded to the establishment. But the idea that Trump’s sort-of vague intuition about this stuff would translate into any serious effort to cultivate the kind-of ideological team that could really catalyze a shift . . . there’s just no evidence of that. I didn’t see it on the campaign. And I don’t think—from what I know of how they’ve done hires—I don’t think ideology is a factor.”

    Prominent backers of the New York mogul who were there with him from the early days—Newt Gingrich, Rudy Giuliani, Chris Christie and even former campaign manager Corey Lewandowski—did not get senior roles in the administration. At the Cabinet level, only Jeff Sessions and perhaps Michael Flynn seemed dyed-in-the-wool ideological national-populists. Instead, his White House was staffed with business titans and generals with whom he had limited previous association—Rex Tillerson, Jim Mattis, Steven Mnuchin, Gary Cohn and Wilbur Ross. He seemed to largely eschew bomb-throwers or the politicians who most robustly voiced support for Trumpism the ideology, such as Duncan Hunter or Kris Kobach. As early as January, one Washington conservative political professional (who refused to vote for Trump) boasted to me that he was both thrilled and stunned with the cabinet selections.

    Roger Stone Jr., the controversial political consultant who sometimes has the ear of the president, has been saying in the press for months that Steve Bannon and his ilk made a mistake by not using more of their “political capital” on staffing choices, leaving them isolated when their mercurial boss had a change of mood.

    Flash forward to this month and the editor of the magazine charged with defending Trumpism—trade protectionism, noninterventionism in foreign affairs, and skepticism of immigration and globalization—has renounced the president. Julius Krein of American Affairs is now on the warpath. “Bannon’s vision,” he says, “of nationalist populism is completely idiotic.” He blames the president for messing this up: “The core problem is at the top. It was always going to be such a weird administration . . . It had to be very nimble, and unite all these different strands. And, when that’s missing at the top. It obviously doesn’t work.” Krein singles out Mattis and Ross as excellent choices, but says that their influence is constrained by a wholly undisciplined president.

    Are Neocons Better at Playing the D.C. Game?

    In the first days following Trump’s election, establishment, even neoconservative, personnel were considered for roles. Nikki Haley, now UN ambassador, has been reported to have been offered the job of secretary of state before Rex Tillerson. In April in New York, she denied the offer, but confirmed the consideration. “The original call that I received to go to Trump Tower was to discuss Secretary of State,” Haley said. “No, he did not offer it.” Haley is firmly associated with the neoconservatives Trump has claimed to loathe, and during the primary she attacked Trump and endorsed his rival, Marco Rubio.

    One reason the likes of Haley rose to the top is that many realists shunned Trump. “There is also the problem that few credentialed realists were eager to work with [Trump],” Scott McConnell, founding editor of The American Conservative, told me. “None were willing to play the game of looking for entry points—as the neocons did early on, with at least some success. . . . [Trump] seemed to have made most initial choices based on whom he might have seen on TV, and relied heavily, and probably overly, on the military, where top people were willing to work with him. He never really had connections to either nationalists/populists or realists—though neither group is that well entrenched in the D.C. think tank world.”

    Haley likely came right up to the line of the only hard-and-fast rule of Trump world: no prior explicit and total renunciations of the man himself.

    “I do think if you’re on the record saying nasty things about Trump, or the Trump family, that stuff can really hurt you,” the former campaign aide told me, in line with a longstanding rumor about Trump’s hiring.

    Elliot Abrams, the former Reagan official nixed as the State Department’s number-two man, was one victim of this policy. Abrams declined comment to the National Interest for this story. And Haley’s position clashes and own personal ambition have had very real policy implications already. Widely thought to be a future presidential candidate, Haley has often stepped out ahead of the State Department with far-more hawkish language in her statements and public appearances as ambassador.

    John Bolton is another example. Though Trump is an outspoken Iraq War critic, he considered the George W. Bush administration’s colorful cheerleader for secretary of state, national security adviser and deputy secretary of state. Bolton also declined comment for this story. Krein protested to me that Bolton is misunderstood, and actually would have been a great choice. McConnell ferociously disagrees: “The problem with Bolton is simple. If you liked George W. Bush’s foreign policy, especially the Iraq War and the idea of regime change carried out by the American military on a multi-country, pan-regional scale, and you want get that kind of policy going again, the search is over: he’s definitely the guy,” he wrote in December.

    Could Things Have Been Different?

    McConnell, a prominent ally of the Pat Buchanan movement that many contend augered the age of Trumpism, has argued that with Bannon gone, there effectively is no White House agenda, only a day-to-day quest for survival. And with Bannon’s exodus, along with former National Security Adviser Michael Flynn, and Reince Priebus and Sean Spicer (establishment professionals who nonetheless helped sell Trump to the party elite), it’s worth asking what sort of questions were asked of job applicants on the campaign and during the transition and afterward, if any.

    One political professional who has advised Republican campaigns, including during 2016, finds the hiring of H. R. McMaster as national security adviser particularly curious, remarking “I don’t know how they could of” asked him any serious ideological questions, “given what they got.”

    “When H.R. McMaster at his first staff meeting tells the collected staff that he does not agree with the use of the term ‘radical Islamic terrorism,’ one would have thought would have come up in the job interview.”

    That sentiment—and the sense of absolute obliteration of the Bannon wing in the administration—was seemingly confirmed by the resignation letter of Sebastian Gorka on Friday.

    “Regrettably, outside of yourself,” he wrote to the president. “The individuals who most embodied and represented the policies that will ‘Make America Great Again,’ have been internally countered, systematically removed, or undermined in recent months. This was made patently obvious as I read the text of your speech on Afghanistan. . . . The fact that those who drafted and approved the speech removed any mention of Radical Islam or radical Islamic terrorism proves that a crucial element of your presidential campaign has been lost.”

    The former campaign aide says he spoke with Stephen Miller, now White House senior advisor, and nothing of the sort came up, at least during the hiring phase.

    “I did have one conversation on ideology,” the former aide tells me.

    “After I was hired and everything, I got a call from Steve Miller. . . . Steve calls me and tells me: ‘The biggest contrast we want to draw is ‘Globalist Hillary’ versus ‘Nationalist Trump.’”

    If anyone has the profile in the West Wing to directly ideologically succeed Bannon, it is Miller. But should he have such ambition, he might argue for a more scrupulous, even rigid system for hiring, lest the administration lets more globalists in around the president.

    “I was a little surprised by that” conversation, the former aide tells me.

    “And I probably discerned around that time that it probably wasn’t going to be a good ideological fit. But, again, it wasn’t like he and I talked about this or he asked for my views or anything. He just sort of said this is what we’re doing. . . . He had every reason to know that I wasn’t a Trumpian ideologue. . . . But it never really came up directly.”

    A Silver Lining For Trumpists?

    If there is a counterview, it’s that the so-called establishment forces now around the president—particularly the troika of Tillerson, Mattis and Chief of Staff John Kelly—aren’t really moderates, at all.

    Mattis has been labeled by some as a stealth agitator for regime change in Iran, and an opponent of the nuclear deal, having developed a uniformly negative impression of that country’s government from his days in Iraq, where units under his command warred with the Shia militias.

    Tillerson, of course, has been called a Russophile by critics—like his boss, too chummy with Vladimir Putin. And his efforts to pull the State Department away from global democratization efforts have been roundly criticized in the establishment.

    Least commented on has been General John Kelly, now chief of staff. He’s a confirmed hardliner from his days heading up U.S. Southern Command—a portfolio of Central and South America. Not just anyone with that kind of knowledge of the situation and professional background would sign up to be the Homeland Security chief for a president who vowed to deport millions of people and build a wall on the Southern border, but Kelly readily did.

    And who knows? Bannon might not be permanently out of the fold, if he even is at all. Trump is known to take late-night calls from a wide-range of actors, including from chums like Stone. Bannon has also argued that he is going to war “for” the president outside of the White House. His battlecry is clear, but whether he will win that war remains unclear.

     

  • Here's The Cartoon Mocking Harvey Survivors That Politico Deleted

    Under pressure from an avalanche of social media backlash, Politico has deleted a tweet containing a cartoon appearing to mock the survivors of Hurrican Harvey

    Drawn by Pulitzer Prize-winning cartoonist, Matt Wuerker, the cartoon shows a person in a Confederate flag shirt, thanking god for being rescued from a flooded house bearing a secessionist sign (and a Gadsden flag). The cartoonist’s irony appears to be that the federal government sent the helicopter to rescue him.

    As Wuerker tried to explain…

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    This did not sit well with many conservatives… and Politico deleted the tweet soon after.

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    Similarly, even The Washington Post described the cartoon as “tone-deaf” and “unhelpful,” saying it was a “needlessly vast oversimplification of a very complex issue at a very sensitive time.”

    “It’s almost a caricature of what you’d expect a liberal cartoonist to draw in response to conservative Texans relying upon the government in their time of crisis,” said Aaron Blake, a Post blogger.

     

    “The Confederate flag T-shirt. The Gadsden Flag. The reference to being saved by God (which seems extremely dismissive of Christianity). The Texas secession banner. It’s all kind of … predictable?”

    Just luck that President Trump didn’t retweet it before they deleted it.

  • Gold Flash-Crashes Below $1300

    After the shenanigans in US mega-tech stocks over the last two days and the seemingly well orchestrated melt-up to pre-J-Hole levels in the dollar, why should anyone be surprised that 'someone' decided to try to sell $1.1 billion notional into the Asian open…

     

    Sending Spot Gold back below the Maginot Line of $1300…

     

    Silver followed suit… with 1300 contracts ($115 million notional) dumped at 21:43:30ET

     

    The Dollar Index spiked as precious metals were 'handled' – note that in the last 48 hours, no dips in the dollar have been allowed…

     

    Was The Bank of Japan at work again?

     

    The flash crash lows coincided with the oddly-timed spike from Monday (that really had very little in the way of specific catalyst)…

    One witty Twitterer asked mischieviously, "Was Kim buying Gold futures ahead of his launch?"

  • Katrina Commander Slams Harvey Response: 'Stop Patting Yourselves on the Back'; This is 'Amateur Hour'

    Content originally published at iBankCoin.com

    Lt. Gen. Honore was in charge of the Katrina response in New Orleans 12 years ago and warned CNN’s Eric Burnett that ‘night is coming’ — saying it was going to get a lot worse before it got better.

    Honore carefully crafted his words and slammed the response in Houston as being grossly inadequate, disgusted by the fact that they didn’t even have 100 helicopters in the city to do search and rescues. He harkened back to the Katrina rescue plan where the 5th army (engineers) used a ‘significant grid system’ for search and rescue. Now, according to Honore, ‘it looks like no one in Texas ever read the plan.’

    “You have to come in big and you’ve got to be there right at the edge of the storm so you can come in as soon as possible and go in and rescue people.

    Back during Katrina, Honore said they had 240 helicopters and 40,000 national guard within the first 4 days, orders of magnitude more than what’s on the ground in Texas now.

    “They just got 100 helicopters here. Something is significantly wrong with command and control and they need to stop patting each other on the back who are waiting to get rescued.”

    “I know I’m sounding critical,” Honore acknowledged as he called for an “Army response to local civil disasters.

    “They’ve come upon a time when their mission is too big for the state National Guard — and they need to get the hell over it and bring them in when they have a big mission.”

    Watch.

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Today’s News 30th August 2017

  • Why Every European Country Has A Trump Or Sanders Candidate

    Authored by Richard Drake via TheAmericanConservative.com,

    The suicide in the Friuli region of northern Italy earlier this year of a 30-year-old man, identified in the newspapers only as Michele, has become a symbol of the country’s unemployment tragedy, particularly as it affects young people.

    Though much worse in the South, the country’s economic crisis also has had a blighting effect on the North. The national unemployment rate now stands at nearly 12 percent. A 40 percent youth unemployment rate nationwide, however, has people speaking of a generational apartheid in Italy. There is no work to be found for young people. In the workplace, comparatively speaking, they have been walled off from the rest of the population.

    Friuli is a region of plain and mountain in the northeastern part of Italy, flush against borders to the north with Austria and the east with Slovenia. The annals of Friuli antedate by many centuries the arrival of the ancient Romans, who founded the colony of Aquileia there nearly two hundred years before Christ. The barbarian invasions swept over Friuli in the general wreckage of the Roman Empire. An Aquileian state arose in the Middle Ages, but was absorbed in the 15th century by the expanding Venetian empire. Then Friuli passed through French and Austrian phases of occupation and control before becoming part the newly founded Kingdom of Italy, in 1866.

    The Friulani, a highly energetic and resourceful people steeped in the work ethic common to the peasant and artisanal cultures of traditional Europe, tilled the land and also gained a well-deserved reputation for their skill in specialty crafts and the building trades. Typically in such cultures, the work that a man did defined him. The modern world has changed those old ways of life, but the culture they generated persists. More recently, Friuli became renowned for its small businesses and factories, which played a vital role in the national economy. There was still hard work for the Friulani to do.

    From his mother’s milk, Michele would have imbibed the work ethic of his native region. He would have thought of work as dignity and honor. In a suicide note, he claimed to be bereft of such things and of hope. “Desire has passed me by,” he wrote. Michele never had been able to find a meaningful job and had despaired of ever finding one. Contemplating his blank future, a sense of deep frustration had crushed his spirit. He hoped that his parents would forgive his dreadful act, but could not envisage a place for himself in a society without work.

    No less than many other regions in the country, Friuli has been devastated by the economic crash of 2008 and its seemingly permanent aftermath. Hundreds of its small businesses and factories have closed, leaving many thousands unemployed. Michele’s father called his son’s death “the defeat of a moribund society.” What other way is there to describe a society unable to create work for its young people?

    One of Italy’s rising political figures, Beppe Grillo of the politically eclectic Five-Star Movement, has proposed a guaranteed citizen income for all Italians. His reasoning appears to be that the Italians should be getting something from their government other than its slavish devotion to the corrupt oligarchy of the banks and corporations that rule the country.

    There is a strong Bernie Sanders and Jill Stein component in the Five-Star Movement, as well as an admiration for the challenge that Hugo Chávez threw down to the multinationals in Venezuela. Grillo also has praised Ecuador’s Rafael Correa for his opposition to the International Monetary Fund, an institution that the Italian leader reviles as a battering ram of noxious austerity policies. Since the recent presidential election in the United States, Grillo has praised Trump as a much-needed change-of-air in world politics. Change of any kind, a powerful sentiment in the United States last fall, exerts the same kind of force in Italy now.

    Even if a guaranteed citizen income initiative were to prevail and become law, the main problem underscored by Michele’s death would still remain. An allowance conjures up the image of juvenile dependence. A national welfare program for all citizens certainly is preferable to leaving ever rising numbers of them in want, but it would not solve in a socially edifying way the anterior problem of work. Michele was not asking for an allowance. He wanted work to do. This is a human need that societies deserving of survival are obliged to supply, a point raised by Thorstein Veblen in the book of his he valued most, The Instinct of Workmanship (1914). Human beings, he wrote, are called by nature to useful effort. It is not only the deprivations and frustrations associated with sex that undermine and subvert the human personality. He judged the men who live by moving money around to be the greatest peril of all to those who live by work.

    The problem of work in Italy today belongs to the class of social consequences identified by Pier Paolo Pasolini in a famous Corriere della Sera article in 1974. “The Italians are no longer what they once were,” he observed. By this statement, Friuli’s greatest poet, filmmaker, and social critic meant that Italy’s traditional values had undergone an anthropological mutation. The country had abandoned its traditional way of life, which in its peasant culture had achieved a kind of poetic synthesis in the saying of Padron ‘Ntoni, novelist Giovanni Verga’s lead character in I Malavoglia (1881): “He is richest who has the fewest wants.” Pasolini feared that the new values of a hedonistic consumer society would be a poor substitute for Italy’s Christian and socialist ideals. What a debased fate for Italy, to come through the civilization-defining vicissitudes of its millennial history, only to end up ignobly aping American-style conspicuous consumption.

    Pasolini had in mind a particular phase of the globalized economy, which since the 1970s has sped forward on the principle that money must be completely liberated to maximize profits for those who have it. It is immediately evident why this golden rule for today’s economy, though achieving its purpose of profit-maximization, has been a poor proposition for most of the working people of the Western world.

    While rates of extreme poverty worldwide have declined in recent decades, the means to produce such a result have required an outsourcing of the West’s manufacturing base. The coincidental surge in profits made possible by the relocation of manufacturing jobs to countries unencumbered by high wages, labor unions, and environmental laws has with perfect justice sparked a political firestorm.

    Nobel Prize-winning economist Joseph Stiglitz explained in Globalization and Its Discontents (2004) that the basic problem with the world’s current financial arrangement concerned the institutions and organizations commanding it. The International Monetary Fund, the World Bank, the World Trade Organization, the U.S. Treasury, and the European Monetary Union protect special interests, Wall Street most of all. Despite their lip-service in democratic argot, the very last thing seriously on the minds of the top financial policy makers is the well-being of ordinary people.

    As a result of the methods used to promote globalization, the consequences for the West have been tragic. Work is becoming increasingly uncertain and insecure, or it is in the process of disappearing altogether. It would take Veblen’s talents for social satire, which are unsurpassed in all of American literature, to depict with the essential exactitude of artistic synthesis how far the United States has fallen away from democratic grace, the country’s dramatically widening gap between the haves and the have-nots being what it is. Clearly, we are on the wrong course. What the robotics revolution, now at an incipient stage, will do to further diminish opportunities for Western peoples to work can be easily imagined, if the economic imperative of corporate capitalism is the rule to go by.

    The same desolating trends can be seen in Europe, where people increasingly regard the European Union as a Trojan horse. The economic elites and their political front-men responsible for this image-challenged contraption lose public support with each new poll. The people by and large blame the European Union and the other accessories of globalization for their worsening standard of living. When informed by the establishment media that thanks to globalization Europe has never been more prosperous and peaceful, Europeans in historic numbers are reacting with disbelief. Their deepening sense of betrayal propels the surge of populism that defines the politics of Europe today.

    Arguments long-settled in favor of deregulation, liberalization, open borders, and other globalization watchwords have been reopened. The constituency is growing for a politics that puts the well-being of Europeans first. Political measures calling for the protection of European jobs and cultures have gained a following unforeseen prior to 2008.

    In Italy, for example, 77 percent of the people questioned in a recent poll could see no advantage to them at all from the country’s membership in the European Union. Sixty-four percent of them expressed hostility toward it. Eight Italian businesses out of 10 can find nothing positive to say about the European Union. It is seen to be a creature of the banks and the big financial houses. As public relations disasters go, this one has unfolded on an epic scale as the underlying populations, long left out of consideration by the economic elites, have begun to sense the fate their masters have in store for them.

    Leaving underlying populations out of consideration was a special feature of the planning that went into globalization. They have been voiceless. In America, Trump gave them a voice, and they responded to him with their political support. It did not matter that he came before them without a plan for their deliverance. That he came to them at all mattered. He understood the depth of the anger and alienation in America against a status quo personified by his opponent, Hillary Clinton, whose repeated and munificently rewarded speeches before the captains of finance on Wall Street effectively branded her as the safe candidate for all who wanted to leave existing economic arrangements fundamentally undisturbed.

    Trump may go down in history as a president who was hopelessly out of his depth on all vital matters, but his presidential campaign will be studied for as long as historians have an interest in American politics. It was a masterpiece of intuition based on an uncannily correct judgment about the spirit of the times. Bernie Sanders had the same insight, but the Democratic Party turned out to be much more corrupt and vulnerable to manipulation than the Republicans, an astonishing feat. In possibly an even more flagrant instance of interference in the American democratic process than anything yet proven against Vladimir Putin, internal machinations weighted the primary process against Sanders. The Republicans tried to head off Trump, too, but a fiercely loyal base and a dearth of plausible opponents gave him an easy victory in the primaries.

    At an academic conference in New York in May a year ago, I participated in a conversation among scholars, journalists, and government officials who generally thought that Trump would not even win 20 percent of the national vote. His ridiculous campaign surely would fall of its own dead weight. Professional pollsters, though not so far wrong as my conference colleagues in New York, also missed what appears to be the main story of the campaign: a loss of faith, unprecedented in its severity, by the American people in the rules of the game. There is no other way to explain the stunningly bizarre choice that they made for the man to lead them.

    That Trump has rapt admirers and self-confessed imitators in Europe should come as no surprise because the mood he represents is an international phenomenon. Virtually every European country has a Trump candidate saying basically the same things that he did in his campaign against immigrants, globalization trade agreements, and the establishment media. Italy has two such candidates: Grillo and the leader of the xenophobic League Party, Matteo Salvini. They are riding a wave of anti-establishment outrage and in tandem are outpolling the two major mainstream parties, the center-left Democratic Party, now in internal disarray from schism, and the center-right Go Italy Party.

    As Europe since the end of World War II has slipped ever more securely into the orbit of American military and economic power, it is only to be expected that the Atlantic Community will be increasingly homogeneous. The Italian case is most instructive about the fundamental meaning of America for Europe. Italy’s greatest postwar novelist, Cesare Pavese, explained in The Moon and the Bonfires (1950), “America is here already. We have our millionaires and people are dying of hunger.” Contemporary Italy, in keeping with Europe as a whole, is best understood as an example of America’s role as the prime mover in international affairs and economics, or of how the world works per necessità, in Machiavelli’s phrase, according to the dictates of those who hold irresistible power.

    By outsourcing its manufacturing base in search of portfolio enhancement, the United States exercised a freedom for which liberty-loving European businessmen, bankers, and politicians hungered as well. Unable to compete with 50-cent per hour labor, the working classes in America and Europe would have to go to the wall, but while adjusting their blindfolds they could rest assured that in the fullness of time the wonder-working ways of the free market would redeem the world.

    Such a promise held no meaning for Michele, and he left this world slamming the door. “I feel betrayed,” he wrote in his suicide note. Who can say which other factors drove him in those last desperate hours before he took his life? We do know what his stated reason was for doing it. Work was the final thought that he had. How else could a Friulano give a good account of himself in this life?

  • Russia Backpedals On Bitcoin – Unveils Plan To Ban Cryptocurrency Sales To "Ordinary People"

    After local Russian media reported earlier this year that the Russian Parliament could legalize bitcoin as soon as 2018, Deputy Finance Minister Alexei Moiseev this week signaled that authorities might instead seek to restrict its use. During an interview with Russia 24, a state-owned news channel, Moiseev said that Russian authorities should treat cryptocurrencies, including bitcoin, as sophisticated financial assets and restrict their use and trading to qualified investors only.

    Moiseev’s statement surprised members of Russia's digital currency community, who had been lead to believe that the Russian government was finally warming to digital currencies after years of skepticism. That belief was strengthened earlier this month when an aide to Vladimir Putin announced that he would seek to raise $100 million to build bitcoin mining infrastructure in Russia, with the goal of controlling as much as 30% of the bitcoin network’s hashpower.

    “’Cryptocurrency should be regulated as a financial asset,’ Vedomosti reported him saying. ‘There is a point of view that cryptocurrencies such as bitcoin is a financial pyramid. Investments [in] such are high-risk. This determines our approach to their regulation.’

     

    RBC quoted him saying: "We propose to call it a currency, but regulate it as other property, qualify it as a financial asset and allow only qualified investors to buy and sell them on the exchange.

    As a regulated financial security, Moiseev said cryptocurrencies would be sold through stock exchanges under the supervision of the Federal Financial Monitoring Service of the Russian Federation, also known as Rosfinmonitoring, according to Bitcoin Magazine.

    Moiseev added that bitcoin is a "dangerous" investment, and that it's the government's duty to protect "ordinary people" from losing their shirts, according to CoinTelegraph.

    “For ordinary people, there’s no way because these are very dangerous investments that could lead to loss of money.”

    According to Moiseev, Russia’s ministry of finance is discussing how to proceed with the central bank and the Moscow stock exchange. Moiseev added that it is necessary for cryptocurrencies to sell through the exchange “to provide judicial protection to participants in transactions.”

    Moiseev detailed that this approach to cryptocurrency regulation aims to protect the rights of buyers and sellers. “Now people do it at their own peril and risk, they have no judicial protection. This is our first task,” he was quoted by Vedomosti.

    His comments then turned to the subject of money laundering.

    “Citing Western Europe and Russia in particular, Ria Novosti quoted him saying “the use of cryptocurrency for illegal operations has become much more frequent because the mechanisms for combating money-laundering are not yet fully applied in all countries to cryptocurrencies.”

    Finally, Moiseev said that the Russian government is uncomfortable with the anonymity provided by bitcoin.

    “Moiseev also explained that it is necessary to sell bitcoins through the regulated stock exchange, so that the regulator will always know ‘who the seller is, who the buyer is, where these bitcoin accounts have moved.’”

    What's worse for bitcoiners is that Russia might be at the vanguard of a shift in how authorities view bitcoin. The SEC late last month declared that digital currencies, including bitcoin and the tokens issued during ICOs, should be treated as securities under the law.

    So far, the SEC's guidance has been vague. But the ease with which digital currencies could be used to finance illicit activities – regardless of whether they’re actually being used for that purpose – likely means that more government crackdowns are ahead. By requiring all local bitcoin exchanges to screen transactions for potential violations, China has found a way to pierce the anonymity surrounding digital-currency transactions.

    Don’t think it can't happen in the US.

  • Battlefield America Is The New Normal: We're Not In Mayberry Anymore

    Authored by John Whitehead via The Rutherford Institute,

    If we’re training cops as soldiers, giving them equipment like soldiers, dressing them up as soldiers, when are they going to pick up the mentality of soldiers?”— Arthur Rizer, former police officer

    America, you’ve been fooled again.

    While the nation has been distracted by a media maelstrom dominated by news of white supremacists, Powerball jackpots, Hurricane Harvey, and a Mayweather v. McGregor fight, the American Police State has been carving its own path of devastation and destruction through what’s left of the Constitution.

    We got sucker punched.

    First, Congress overwhelmingly passed—and President Trump approved—a law allowing warrantless searches of private property for the purpose of “making inspections, investigations, examinations, and testing.”

    For now, the scope of the law is geographically limited to property near the Washington DC Metro system, but mark my words, this is just a way of testing the waters. Under the pretext of ensuring public safety by “inspecting” property in the vicinity of anything that could be remotely classified as impacting public safety, the government could gain access to almost any private property in the country.

    Then President Trump, aided and abetted by his trusty Department of Justice henchman Jeff Sessions and to the delight of the nation’s powerful police unions, rolled back restrictions on the government’s military recycling program.

    What this means is that police agencies, only minimally deterred by the Obama administration’s cosmetic ban on certain types of military gear, can now go hog-wild.

    We’re talking Blackhawk helicopters, machine guns, grenade launchers, battering rams, explosives, chemical sprays, body armor, night vision, rappelling gear, armored vehicles, and tanks.

    Clearly, we’re not in Mayberry anymore.

    Or if this is Mayberry, it’s Mayberry in The Twilight Zone.

    As journalist Benjamin Carlson stresses, “In today’s Mayberry, Andy Griffith and Barney Fife could be using grenade launchers and a tank to keep the peace.”

    Contrast the idyllic Mayberry with the American police state of today, where local police—clad in jackboots, helmets and shields and wielding batons, pepper-spray, stun guns, and assault rifles—have increasingly come to resemble occupying forces in communities across the country.

    As Alyssa Rosenberg writes for The Washington Post, “[The Andy Griffith Show] expressed an ideal that has leached out of American pop culture and public policy, to dangerous effect: that the police were part of the communities that they served and shared their fellow citizens’ interests. They were of their towns and cities, not at war with them.”

    That’s really what this is about: a war on the American citizenry waged by local law enforcement armed to the teeth with weapons previously only seen on the battlefield

    As investigative journalists Andrew Becker and G.W. Schulz reveal, “Many police, including beat cops, now routinely carry assault rifles. Combined with body armor and other apparel, many officers look more and more like combat troops serving in Iraq and Afghanistan.”

    Thanks to Trump, this transformation of America into a battlefield is only going to get worse.

    To be fair, Trump did not create this totalitarian nightmare. However, he has legitimized it and, in so doing, has also accelerated the pace at which we fall deeper into the clutches of outright tyranny.

    In the hands of government agents, whether they are members of the military, law enforcement or some other government agency, these weapons of war have become accepted instruments of tyranny, routine parts of America’s day-to-day life, a byproduct of the rapid militarization of law enforcement over the past several decades.

    It’s a modern-day Trojan Horse.

    Although these federal programs that allow the military to “gift” battlefield-appropriate weapons, vehicles and equipment to domestic police departments at taxpayer expense are being sold to communities as a benefit, the real purpose is to keep the defense industry churning out profits, bring police departments in line with the military, and establish a standing army.

    It’s a militarized approach to make-work programs, except in this case, instead of unnecessary busy work to keep people employed, communities across America are finding themselves “gifted” with unnecessary drones, tanks, grenade launchers and other military equipment better suited to the battlefield in order to fatten the bank accounts of the military industrial complex.

    In addition to being an astounding waste of taxpayer money, this equipping of police with military-grade equipment and weapons also gives rise to a dangerous mindset in which police adopt a warrior-like, more aggressive approach to policing.

    The results are deadly.

    As a study by researchers at Stanford University makes clear, “When law enforcement receives more military materials — weapons, vehicles and tools — it becomes … more likely to jump into high-risk situations. Militarization makes every problem — even a car of teenagers driving away from a party — look like a nail that should be hit with an AR-15 hammer.”

    The danger of giving police high-power toys and weapons is that they will feel compelled to use it in all kinds of situations that would never normally warrant battlefield gear, weapons or tactics.

    Suffice it to say, change will not come easily.

    As I make clear in my book Battlefield America: The War on the American People, the police unions are a powerful force and they will not relinquish their power easily. Connect the dots and you’ll find that most, if not all, attempts to cover up police misconduct or sidestep accountability can be traced back to police unions and the police lobby.

    Just look at Trump: he’s been on the police unions’ payroll from the moment they endorsed him for president, and he’s paid them back generously by ensuring that police can kill, shoot, taser, abuse and steal from American citizens with impunity.

    Still, the responsibility rests with “we the people.”

    As author Ta-Nehisi Coates reminds us:

    The truth is that the police reflect America in all of its will and fear, and whatever we might make of this country’s criminal justice policy, it cannot be said that it was imposed by a repressive minority. The abuses that have followed from these policies—the sprawling carceral state, the random detention of black people, the torture of suspects—are the product of democratic will. And so to challenge the police is to challenge the American people who send them into the ghettos armed with the same self-generated fears that compelled the people who think they are white to flee the cities and into the Dream. The problem with the police is not that they are fascist pigs but that our country is ruled by majoritarian pigs.

  • "What The F*ck!": Rescued Woman Blasts CNN For Exploiting Hurricane Harvey Victims

    Earlier today, CNN anchor Rosa Flores apparently chose the wrong mom to exploit in her futile effort to boost CNN ratings.

    While it’s unclear exactly what happened off-air in the moments leading up to this interview, it became clear very quickly that this “shivering cold” mother of two exhausted children had no appetite for Flores shoving a “microphone in her face” to get a couple of sound bites for Jim Acosta’s show.

    “We walked through four feet of water to get food on the first day.  Yeah, that’s a lot of shit.”

     

    “But y’all sit here, y’all trying to interview people during their worst times — like that’s not the smartest thing to do. Like people are really breaking down and y’all sitting here with cameras and microphones trying to ask us what the fuck is wrong with us.”

     

    “And you really trying to understand with the microphone still in my face? With me shivering cold, with my kids wet, and you still putting the microphone in my face.”

     

    Not surprisingly, Kellyanne Conway immediately took to twitter to shame CNN for the failed interview.

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    Of course, even though Conway’s tweet will be dismissed as a cheap shot, it does seem somewhat obvious from the jump that this mom is exhausted beyond belief and probably slightly more interested in finding some dry clothes for herself and her children than sharing her feelings with CNN.  That said, maybe we’re just really good at picking up on subtle social cues…

    Meanwhile, the whole episode left Jim Acosta noticeably ‘triggered’…

    Acosta

  • Some "Charitable Humans" Aren't Very Giving Toward "Red State" Texas

    Authored by Daisy Luther via The Organic Prepper blog,

    The social media manager of Charitable Humans didn’t sound particularly giving in a series of despicable tweets directed toward Texas yesterday.

    This isn’t the only nasty-spirited tweet by the organization, which describes itself as a “progressive tax-exempt nonprofit organization seeking new and innovative approaches to address issues in our world and advance humanitarian causes.”

    Someone grabbed a screenshot of the other shocking tweets, too.

    Psst: I’d just like to point out to the misguided tweeter that Hillary Clinton actually carried the election in Houston with 707,914 votes to Trump’s 545,955 votes. (source)

    source

    While I completely support the right of any person not to donate money to a cause they find repugnant, to publically espouse such a vile opinion like that is in the poorest of taste. What a stunning stream of hatred from the spokesperson of a group that is supposed to help people in need.

    This is more evidence that some people on the Left just really don’t think like the rest of us do and can justify any opinion in the name of “social justice.”

    Then (not-so-) Charitable Humans sort of apologized.

    After a righteous outcry on Twitter, Charitable Humans closed down all of their social media accounts and then posted an explanatory, half-hearted apology on their website, entitled “We’re Horrified by Our Twitter Actions.”

    There are no words to express the distaste and hateful words that our Social Media Coordinator unleashed on what was supposed to represent Charitable Humans, an organization that has engaged in global humanitarianism activities in war-torn and severely impoverished nations since 2005. The purpose of our charity was, and so remains, to make the world a better place by focusing on a larger mandate of cultivating a global citizenship initiative along with an online platform for active engagement, and a platform to help people and nonprofit organizations like ours further the reach and impact of good deeds.

     

    We don’t condone the denouncement or imperilment of any human, individual or group; ultimately because that serves no useful purpose and is rather an impairment to progressive change. Our views extend equally toward those that do good and evil in the world, for both have much to teach us about the state of humanity. We’re not for a moment implying that the targets in which the Tweets offensive content are either good, bad, or otherwise because we don’t believe those words are more than labels based upon an individual’s perception of another. Our organization views people for what they are: humans. Everything else is merely a means by which to divide us into opposing factions.

     

    We take full responsibility for this outrageous lack of leadership, for which there is no excuse, though there is an explanation we’d like to put forward in the interest of transparency. We are not a large organization, and we’ve invested much time and sacrifice trying to undertake an endeavor that is much greater than we have the resources or team members to focus on at the capacity needed… (source)

    I noticed that they didn’t mention whether their social media manager had been fired or not.

    Instead of leaving it at that, they added more to their response as social media erupted over their horrible series of tweets, citing irony in the most ironic way possible.

    As an organization, we’re doing everything in our ability to make our official position known and remove all content espousing such hateful, insensitive, and offensive viewpoints. Beyond that, what people choose to believe about our organization despite our efforts are up to them. If the actions of one individual give cause for others to condemn the whole our organization, the work we’ve done, and what we have the potential to do in the future; no response or remedy is going to matter.

     

    What’s becoming obvious is that the risky proposition of continuing any endeavor, charitable or otherwise, in an environment where perfection is expected without a single misstep, is tenuous indeed. No good or progress within society is attainable wherein forgiveness is not attainable. It saddens me that there are people who will allow a single bad act to negate more than a decade of positive impact and humanitarian accomplishments, but nonetheless, we respect peoples’ right to form their own code of conduct and worldview.

     

    It’s rather ironic that, in the same irrational generalization that denounced an entire sect of people, rightly offending a great many, the response by many has been to also measure the sum totality of our organization by its tweets. I point this out not as an excuse, but to highlight how divisive and impractical it is to achieve anything productive when groups take precedence over human individualism.(source)

    This isn’t the first time the Left has been happy about a tragedy.

    Personally, I’m having flashbacks to the Gatlinburg fire, when a bunch of “progressives” tweeted gleefully about how well-deserved the tragedy was for those who were pro-Trump during the election.

    People who dislike Trump seem to think that the Gatlinburg fire is just desserts for the locals in Tennessee who voted for Donald Trump. I’ve written previously about how those protesting Trump’s election really feel about the people they believe caused Hillary Clinton’s defeat, but this takes things to a sub-human low.

    Melissa Dykes reported:

     

    Not only are people saying the Gatlinburg fires are “karma” for the “racist” Trump supporters who live there —

     

    And saying Trump supporters “brought this on themselves” and are being punished by God for voting Trump —

     

    But people are actually out there laughing about Trump supporters’ houses burning down in the Tennessee fires, and even star Michael Ian Black is making glib, dickish jokes about it.

     

    Check out the whole sad, disgusting report here and weep for humanity.

     

    From a prepper point of view, keep in mind that these smug, superior individuals will be the ones that feel entitled to your food and emergency supplies. While they like to portray themselves as tolerant and kind to minorities and immigrants, don’t be fooled. Their scorn for working-class, middle America couldn’t be more blatant. (source)

    What a sad state of division we are in when even tragedy doesn’t pull us together. It makes you wonder if we can ever again be united.

    But, mercifully, all Americans aren’t like that.

    Thankfully, the people of the Gulf states are working hand in hand to aid the official response. In fact, Texas has been the kind of wonderful example of dignity and self-reliance that makes me proud to be an American.

    There are many heartwarming stories of the Cajun Navy rescuing people trapped in their homes and even one of them pulling an elderly woman who was floating face down in the water and resuscitating her. Neighbors are helping neighbors, and people from all over are coming to help.

    With the level of devastation (and it isn’t over yet) it may take a while. But I know that Texas will recover from this devastating disaster.

  • Mattis: "Transgender Troops Can Continue Serving, Pending Study"

    The approximately 15,000 transgender servicemembers can breathe a sigh of relief – for now, at least.

    Defense Secretary James Mattis announced on Tuesday that trans soldiers will be allowed to remain in the military pending the results of a study conducted by a panel of experts. The news, which was first reported by USA Today, follows President Donald Trump’s signing last week of a memorandum officially prohibiting individuals who identify as transgender from joining the military.  In that memorandum, Trump granted Mattis and the Department of Defense and the Department of Homeland Security (which includes the US Coast Guard) wide latitude to decide how trans servicemembers should be treated.

    The policy shift, which Trump first announced via Twitter last month, reverses an Obama-era decision, made shortly before he left office, that allowed trans individuals to service openly for the first time.

    Mattis said the current policy of allowing trans individuals who are currently serving to finish out their assignments will remain in place, unless the panel recommends that it be reversed.

    "Once the panel reports its recommendations and following my consultation with the secretary of Homeland Security, I will provide my advice to the president concerning implementation of his policy direction," Mattis said in the statement. "In the interim, current policy with respect to currently serving members will remain in place."

    His decision will give the Pentagon more time to work out the details of allowing trans individuals to serve, like determining whether the VA should pay for gender-reassignment surgery. 

    “Mattis' move buys time for the Pentagon to determine how and if it will allow thousands of transgender troops to continue to serve, whether they will receive medical treatment, or how they will be discharged.”

    Contrary to the perception, this decision does not signal that Mattis agrees with Obama’s directive that all trans people be allowed to serve. Mattis, as USA Today notes, has “little tolerance for policies that detract from military readiness.” Back in June, he delayed the Pentagon’s plan to accept new transgender troops to allow more time to study the effect of transgender recruitment on the US’s ability to fight (and win) wars.

    When Obama first lifted the ban, the Pentagon outlined its plan for providing medical coverage to trans soldiers. The plan mandated that the VA should cover gender reassignment surgery if it was deemed medically necessary.

    //platform.twitter.com/widgets.js

    Trump claimed that the military wouldn’t pay for these surgeries when he first announced his decision to reinstate the ban.

     

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    A RAND Corp. study commissioned by the Pentagon last year found that trans troops would have a “negligible” impact on military readiness, according to USA Today.

    “Last year, the Pentagon commissioned a study by the non-partisan RAND Corp. to examine the effects on military readiness of allowing transgender troops to serve openly and the cost of providing them medical treatment. The study estimated that a few to several thousand transgender troops are on the active duty force of 1.3 million. Researchers found that paying for their health care needs would amount to about $8 million per year and their effect on readiness would be negligible.”

    As we’ve previously reported, available data suggest that trans people serve in the military at rates well above the national average. Though the data is sparse, studies estimate that trans men and women are anywhere from two- to five-times more likely to join the military as their cisgender (nontrans) counterparts.

    Trans service members and veterans offer a variety of explanations for this disparity. For some, the military uniform functions as gender camouflage—a way to forestall uncomfortable questions from friends, family, or spouses. For others, joining the armed forces offers financial security and community to a group that is disproportionately denied both.

    Contrary to what progressives may believe, the reality of whether trans individuals should be allowed to openly serve is a complex one. To better accomodate trans servicemembers, the military needs to develop guidelines not just relating to their medical care, but to a host of other issues affecting both their well-being, and the well-being of their fellow soldiers. Whatever Mattis’s panel ultimately decides, at least it will be an evidence-based decision.

  • Giant Chemical Plant In Crosby, Texas Warns It Is In "Real Danger" Of Exploding

    A chemical plant in Crosby, Texas belonging to French industrial giant Arkema SA, has announced it is evacuating workers on Tuesday due to the risk of an explosion, after Tropical Storm Harvey knocked out power and flooding swamped its backup generators. The French company said the situation at the plant “has become serious” and said that it is working with the Department of Homeland Security and the State of Texas to set up a command post in a suitable location near our site.

    The plant, which produces explosive organic peroxides and ammonia, was hit by more than 40 inches of rain and has been heavily flooded, running without electricity since Sunday. The plant was closed since Friday but has had a skeleton staff of about a dozen in place. Following the flood surge, the plant’s back-up generators also failed.

    According to the plant’s website description, it “produces methyl mercaptan, ethyl mercaptan, dimethyl sulfide (DMS) and methylmercapto-proprionaldehyde (MMP).”

    Our products are key ingredients in the manufacture of biodegradable herbicides, pesticides and animal feed supplements. These products are also used in the production of pharmaceuticals, photographic chemicals and circuit boards. Ethyl mercaptan is primarily used as an odorizer for propane gas. The strong odor that ethyl mercaptan adds to propane makes gas leaks easier to detect, protecting homes and businesses. MMP is used in the production of methionine, an essential amino acid and a key component of poultry, swine and ruminant (cattle, sheep, etc.) feed.

    The threat emerged once the company could no longer maintain refrigeration for chemicals located on site, which have to be stored at low temperatures. The plant lost refrigeration when backup generators were flooded and then workers transferred products from the warehouses into diesel-powered refrigerated containers.

    In a statement released at 3:30pm, Arkema said “refrigeration on some of our back-up product storage containers has been compromised due to extremely high water, which is unprecedented in the Crosby area.  We are monitoring the temperature of each refrigeration container remotely.”

    It then warned that “while we do not believe there is any imminent danger, the potential for a chemical reaction leading to a fire and/or explosion within the site confines is real.”

    Earlier in the day, Arkema said that the company “is limited in what it can do to address the site conditions until the storm abates.  Arkema does not believe that the situation presents a risk to the community or the ride-out crew, due to the distance between the refrigerated cars and any people.  We are working without pause to keep our materials safe. We have no higher priority than the safety of our employees, neighbors and the environment.”

    Just 6 hours later it admitted that the situations presents a risk after all.

    Rep. Ted Poe, a Texas Republican, wrote on Twitter that the Crosby plant “is in danger of fire/explosion. The local area is being evacuated. Stay out of area.

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    Meanwhile, Reuters adds that other chemical plants have also shuttered production in Texas because of the hurricane. These include Anglo-Swiss chemicals firm Ineos Group Holdings, which said it has been forced to shut down facilities in Texas. Chocolate Bayou Works and Battleground Manufacturing Complex, and INEOS Nitriles’ Green Lake facility are following hurricane procedures and are temporarily shut down, spokesman Charles Saunders said. Huntsman Corp said it has closed six chemical plants in Texas, along with its global headquarters and advanced technology center in Texas.

  • Hurricane Harvey Likely To Destroy More Cars Than Katrina: "This Is Bad; Real Bad"

    Hurricane Harvey’s historic flooding in Texas is set to wreak havoc on the auto industry and its insurers with analysts now predicting the storm could damage more vehicles than Hurricane Katrina.  In August 2005, Katrina wiped out some 500,000-600,000 vehicles but William Armstrong of CL King warns that Houston has about 5x more people than New Orleans did at the time.

    Hurricane Harvey could damage more vehicles than Hurricane Katrina, driving business to the salvage auctions operated by Copart and KAR Auction Services, CL King analyst William Armstrong wrote in a note.

     

    Katrina damaged 500,000-600,000 vehicles in August 2005, and the greater Houston MSA is five times as populous as pre-Katrina New Orleans.

     

    The cost of dealing with catastrophes can be higher than normal given vehicle extraction, towing and temporary storage and auction locations, though both companies have grown their physical presence in Texas over the last year, which should lower the need for temporary locations.

     

    It may be 2-3 months or longer until damaged vehicles are sold at auction.

    Cars

     

    Of course, storms of this magnitude bring not only millions in salvage-related charge offs for the auto industry but a loss of critical “selling days” for one of the biggest markets in the country.  As CNBC points out this morning, Citi analyst Itay Michaeli figures Hurricane Harvey could knock about 500,000 units off the August auto SAAR to be reported later this week.

    Given the widespread flooding that will swamp dealerships and kill potential sales, analysts are bringing down estimates for the August new vehicle sales in the U.S.

     

    Citi analyst Itay Michaeli has cut his estimate for the rate of monthly auto sales in August, which are reported on Friday. He estimates Harvey will affect some 125 counties in Texas and about 60 percent of the state’s auto sales.

     

    Before Harvey, Michaeli estimated the August sales pace for the country was going to be in the mid-$16 million range. As the storm lingers over the area, Michaeli has dropped his estimate.

     

    “Our analysis suggests that Hurricane Harvey could push this down to the low-$16 million unit range,” Michaeli wrote in a note to clients.

    In terms of the publicly traded used car dealers, Stephens analyst Rick Nelson notes that Group 1 Automotive has the heaviest exposure to Hurricane Harvey, with ~37% of revenues from Texas, followed by Sonic (~25%) and AutoNation (~21%).  Meanwhile, Autonation CEO Marc Cannon appeared on CNBC this morning to discuss the devastation:

    “This is bad; real bad,” said Marc Cannon, an AutoNation executive vice president. “Right now, we are focused on making sure all of our employees are safe and taken care of. At the same time, we’re focusing on getting all of our stores up and running.”

     

    AutoNation’s 18 dealerships in the Houston area are shut down. Widespread flooding has not only swamped thousands of buildings in the Houston area, it’s likely damaged hundreds, perhaps thousands of new cars and trucks parked on dealership lots.

     

    “We’re holding calls with our staff every three hours,” Cannon said. “We have reopened our stores in Corpus Christi and Austin, but some of the Houston stores may take some time.”

    Then, for the ‘less reputable’ used car dealers, no good crisis can be allowed to go to waste.  As carfax points out, if previous hurricanes are any example, roughly half of the cars flooded by Hurricane Harvey will eventually be sold with no flood label to unsuspecting consumers.

     

    Of course, when the auto OEMs report abysmal sales this Friday they will undoubtedly also tell you how Hurricane Harvey is great for long-term sales because of all the salvaged cars that have to be replaced.

  • Why Google Made The NSA

    Authored by Nafeez Ahmed via Medium.com,

    Inside the secret network behind mass surveillance, endless war, and Skynet…

    INSURGE INTELLIGENCE, a new crowd-funded investigative journalism project, breaks the exclusive story of how the United States intelligence community funded, nurtured and incubated Google as part of a drive to dominate the world through control of information. Seed-funded by the NSA and CIA, Google was merely the first among a plethora of private sector start-ups co-opted by US intelligence to retain ‘information superiority.’

     

     

    The origins of this ingenious strategy trace back to a secret Pentagon-sponsored group, that for the last two decades has functioned as a bridge between the US government and elites across the business, industry, finance, corporate, and media sectors. The group has allowed some of the most powerful special interests in corporate America to systematically circumvent democratic accountability and the rule of law to influence government policies, as well as public opinion in the US and around the world.

     

    The results have been catastrophic: NSA mass surveillance, a permanent state of global war, and a new initiative to transform the US military into Skynet.

    This exclusive is being released for free in the public interest, and was enabled by crowdfunding. I’d like to thank my amazing community of patrons for their support, which gave me the opportunity to work on this in-depth investigation. Please support independent, investigative journalism for the global commons.

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    Read Part 1 here…

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    Mass surveillance is about control. It’s promulgators may well claim, and even believe, that it is about control for the greater good, a control that is needed to keep a cap on disorder, to be fully vigilant to the next threat. But in a context of rampant political corruption, widening economic inequalities, and escalating resource stress due to climate change and energy volatility, mass surveillance can become a tool of power to merely perpetuate itself, at the public’s expense.

    A major function of mass surveillance that is often overlooked is that of knowing the adversary to such an extent that they can be manipulated into defeat. The problem is that the adversary is not just terrorists. It’s you and me. To this day, the role of information warfare as propaganda has been in full swing, though systematically ignored by much of the media.

    Here, INSURGE INTELLIGENCE exposes how the Pentagon Highlands Forum’s co-optation of tech giants like Google to pursue mass surveillance, has played a key role in secret efforts to manipulate the media as part of an information war against the American government, the American people, and the rest of the world: to justify endless war, and ceaseless military expansionism.

    The war machine

    In September 2013, the website of the Montery Institute for International Studies’ Cyber Security Initiative (MIIS CySec) posted a final version of a paper on ‘cyber-deterrence’ by CIA consultant Jeffrey Cooper, vice president of the US defense contractor SAIC and a founding member of the Pentagon’s Highlands Forum. The paper was presented to then NSA director Gen. Keith Alexander at a Highlands Forum session titled ‘Cyber Commons, Engagement and Deterrence’ in 2010.

    Gen. Keith Alexander (middle), who served as director of the NSA and chief of the Central Security Service from 2005 to 2014, as well as commander of the US Cyber Command from 2010 to 2014, at the 2010 Highlands Forum session on cyber-deterrence

    MIIS CySec is formally partnered with the Pentagon’s Highlands Forum through an MoU signed between the provost and Forum president Richard O’Neill, while the initiative itself is funded by George C. Lee: the Goldman Sachs executive who led the billion dollar valuations of Facebook, Google, eBay, and other tech companies.

    Cooper’s eye-opening paper is no longer available at the MIIS site, but a final version of it is available via the logs of a public national security conference hosted by the American Bar Association. Currently, Cooper is chief innovation officer at SAIC/Leidos, which is among a consortium of defense technology firms including Booz Allen Hamilton and others contracted to develop NSA surveillance capabilities.

    The Highlands Forum briefing for the NSA chief was commissioned under contract by the undersecretary of defense for intelligence, and based on concepts developed at previous Forum meetings. It was presented to Gen. Alexander at a “closed session” of the Highlands Forum moderated by MIIS Cysec director, Dr. Itamara Lochard, at the Center for Strategic and International Studies (CSIS) in Washington DC.

    SAIC/Leidos’ Jeffrey Cooper (middle), a founding member of the Pentagon’s Highlands Forum, listening to Phil Venables (right), senior partner at Goldman Sachs, at the 2010 Forum session on cyber-deterrence at the CSIS

    Like Rumsfeld’s IO roadmap, Cooper’s NSA briefing described “digital information systems” as both a “great source of vulnerability” and “powerful tools and weapons” for “national security.” He advocated the need for US cyber intelligence to maximize “in-depth knowledge” of potential and actual adversaries, so they can identify “every potential leverage point” that can be exploited for deterrence or retaliation. “Networked deterrence” requires the US intelligence community to develop “deep understanding and specific knowledge about the particular networks involved and their patterns of linkages, including types and strengths of bonds,” as well as using cognitive and behavioural science to help predict patterns. His paper went on to essentially set out a theoretical architecture for modelling data obtained from surveillance and social media mining on potential “adversaries” and “counterparties.”

    A year after this briefing with the NSA chief, Michele Weslander Quaid?—?another Highlands Forum delegate?—?joined Google to become chief technology officer, leaving her senior role in the Pentagon advising the undersecretary of defense for intelligence. Two months earlier, the Defense Science Board (DSB) Task Force on Defense Intelligence published its report on Counterinsurgency (COIN), Intelligence, Surveillance and Reconnaissance (IRS) Operations. Quaid was among the government intelligence experts who advised and briefed the Defense Science Board Task Force in preparing the report. Another expert who briefed the Task Force was Highlands Forum veteran Linton Wells. The DSB report itself had been commissioned by Bush appointee James Clapper, then undersecretary of defense for intelligence?—?who had also commissioned Cooper’s Highlands Forum briefing to Gen. Alexander. Clapper is now Obama’s Director of National Intelligence, in which capacity he lied under oath to Congress by claiming in March 2013 that the NSA does not collect any data at all on American citizens.

    Michele Quaid’s track record across the US military intelligence community was to transition agencies into using web tools and cloud technology. The imprint of her ideas are evident in key parts of the DSB Task Force report, which described its purpose as being to “influence investment decisions” at the Pentagon “by recommending appropriate intelligence capabilities to assess insurgencies, understand a population in their environment, and support COIN operations.”

    The report named 24 countries in South and Southeast Asia, North and West Africa, the Middle East and South America, which would pose “possible COIN challenges” for the US military in coming years. These included Pakistan, Mexico, Yemen, Nigeria, Guatemala, Gaza/West Bank, Egypt, Saudi Arabia, Lebanon, among other “autocratic regimes.” The report argued that “economic crises, climate change, demographic pressures, resource scarcity, or poor governance could cause these states (or others) to fail or become so weak that they become targets for aggressors/insurgents.” From there, the “global information infrastructure” and “social media” can rapidly “amplify the speed, intensity, and momentum of events” with regional implications. “Such areas could become sanctuaries from which to launch attacks on the US homeland, recruit personnel, and finance, train, and supply operations.”

    The imperative in this context is to increase the military’s capacity for “left of bang” operations?—?before the need for a major armed forces commitment?—?to avoid insurgencies, or pre-empt them while still in incipient phase. The report goes on to conclude that “the Internet and social media are critical sources of social network analysis data in societies that are not only literate, but also connected to the Internet.” This requires “monitoring the blogosphere and other social media across many different cultures and languages” to prepare for “population-centric operations.”

    The Pentagon must also increase its capacity for “behavioral modeling and simulation” to “better understand and anticipate the actions of a population” based on “foundation data on populations, human networks, geography, and other economic and social characteristics.” Such “population-centric operations” will also “increasingly” be needed in “nascent resource conflicts, whether based on water-crises, agricultural stress, environmental stress, or rents” from mineral resources. This must include monitoring “population demographics as an organic part of the natural resource framework.”

    Other areas for augmentation are “overhead video surveillance,” “high resolution terrain data,” “cloud computing capability,” “data fusion” for all forms of intelligence in a “consistent spatio-temporal framework for organizing and indexing the data,” developing “social science frameworks” that can “support spatio-temporal encoding and analysis,” “distributing multi-form biometric authentication technologies [“such as fingerprints, retina scans and DNA samples”] to the point of service of the most basic administrative processes” in order to “tie identity to all an individual’s transactions.” In addition, the academy must be brought in to help the Pentagon develop “anthropological, socio-cultural, historical, human geographical, educational, public health, and many other types of social and behavioral science data and information” to develop “a deep understanding of populations.”

    A few months after joining Google, Quaid represented the company in August 2011 at the Pentagon’s Defense Information Systems Agency (DISA) Customer and Industry Forum. The forum would provide “the Services, Combatant Commands, Agencies, coalition forces” the “opportunity to directly engage with industry on innovative technologies to enable and ensure capabilities in support of our Warfighters.” Participants in the event have been integral to efforts to create a “defense enterprise information environment,” defined as “an integrated platform which includes the network, computing, environment, services, information assurance, and NetOps capabilities,” enabling warfighters to “connect, identify themselves, discover and share information, and collaborate across the full spectrum of military operations.” Most of the forum panelists were DoD officials, except for just four industry panelists including Google’s Quaid.

    DISA officials have attended the Highlands Forum, too?—?such as Paul Friedrichs, a technical director and chief engineer of DISA’s Office of the Chief Information Assurance Executive.

    Knowledge is Power

    Given all this it is hardly surprising that in 2012, a few months after Highlands Forum co-chair Regina Dugan left DARPA to join Google as a senior executive, then NSA chief Gen. Keith Alexander was emailing Google’s founding executive Sergey Brin to discuss information sharing for national security. In those emails, obtained under Freedom of Information by investigative journalist Jason Leopold, Gen. Alexander described Google as a “key member of [the US military’s] Defense Industrial Base,” a position Michele Quaid was apparently consolidating. Brin’s jovial relationship with the former NSA chief now makes perfect sense given that Brin had been in contact with representatives of the CIA and NSA, who partly funded and oversaw his creation of the Google search engine, since the mid-1990s.

    In July 2014, Quaid spoke at a US Army panel on the creation of a “rapid acquisition cell” to advance the US Army’s “cyber capabilities” as part of the Force 2025 transformation initiative. She told Pentagon officials that “many of the Army’s 2025 technology goals can be realized with commercial technology available or in development today,” re-affirming that “industry is ready to partner with the Army in supporting the new paradigm.” Around the same time, most of the media was trumpeting the idea that Google was trying to distance itself from Pentagon funding, but in reality, Google has switched tactics to independently develop commercial technologies which would have military applications the Pentagon’s transformation goals.

    Yet Quaid is hardly the only point-person in Google’s relationship with the US military intelligence community.

    One year after Google bought the satellite mapping software Keyhole from CIA venture capital firm In-Q-Tel in 2004, In-Q-Tel’s director of technical assessment Rob Painter?—?who played a key role in In-Q-Tel’s Keyhole investment in the first place?—?moved to Google. At In-Q-Tel, Painter’s work focused on identifying, researching and evaluating “new start-up technology firms that were believed to offer tremendous value to the CIA, the National Geospatial-Intelligence Agency, and the Defense Intelligence Agency.” Indeed, the NGA had confirmed that its intelligence obtained via Keyhole was used by the NSA to support US operations in Iraq from 2003 onwards.

    A former US Army special operations intelligence officer, Painter’s new job at Google as of July 2005 was federal manager of what Keyhole was to become: Google Earth Enterprise. By 2007, Painter had become Google’s federal chief technologist.

    That year, Painter told the Washington Post that Google was “in the beginning stages” of selling advanced secret versions of its products to the US government. “Google has ramped up its sales force in the Washington area in the past year to adapt its technology products to the needs of the military, civilian agencies and the intelligence community,” the Post reported. The Pentagon was already using a version of Google Earth developed in partnership with Lockheed Martin to “display information for the military on the ground in Iraq,” including “mapping out displays of key regions of the country” and outlining “Sunni and Shiite neighborhoods in Baghdad, as well as US and Iraqi military bases in the city. Neither Lockheed nor Google would say how the geospatial agency uses the data.” Google aimed to sell the government new “enhanced versions of Google Earth” and “search engines that can be used internally by agencies.”

    White House records leaked in 2010 showed that Google executives had held several meetings with senior US National Security Council officials. Alan Davidson, Google’s government affairs director, had at least three meetings with officials of the National Security Council in 2009, including White House senior director for Russian affairs Mike McFaul and Middle East advisor Daniel Shapiro. It also emerged from a Google patent application that the company had deliberately been collecting ‘payload’ data from private wifi networks that would enable the identification of “geolocations.” In the same year, we now know, Google had signed an agreement with the NSA giving the agency open-ended access to the personal information of its users, and its hardware and software, in the name of cyber security?—?agreements that Gen. Alexander was busy replicating with hundreds of telecoms CEOs around the country.

    Thus, it is not just Google that is a key contributor and foundation of the US military-industrial complex: it is the entire Internet, and the wide range of private sector companies?—?many nurtured and funded under the mantle of the US intelligence community (or powerful financiers embedded in that community)?—?which sustain the Internet and the telecoms infrastructure; it is also the myriad of start-ups selling cutting edge technologies to the CIA’s venture firm In-Q-Tel, where they can then be adapted and advanced for applications across the military intelligence community. Ultimately, the global surveillance apparatus and the classified tools used by agencies like the NSA to administer it, have been almost entirely made by external researchers and private contractors like Google, which operate outside the Pentagon.

    This structure, mirrored in the workings of the Pentagon’s Highlands Forum, allows the Pentagon to rapidly capitalize on technological innovations it would otherwise miss, while also keeping the private sector at arms length, at least ostensibly, to avoid uncomfortable questions about what such technology is actually being used for.

    But isn’t it obvious, really? The Pentagon is about war, whether overt or covert. By helping build the technological surveillance infrastructure of the NSA, firms like Google are complicit in what the military-industrial complex does best: kill for cash.

    As the nature of mass surveillance suggests, its target is not merely terrorists, but by extension, ‘terrorism suspects’ and ‘potential terrorists,’ the upshot being that entire populations?—?especially political activists?—?must be targeted by US intelligence surveillance to identify active and future threats, and to be vigilant against hypothetical populist insurgencies both at home and abroad. Predictive analytics and behavioural profiles play a pivotal role here.

    Mass surveillance and data-mining also now has a distinctive operational purpose in assisting with the lethal execution of special operations, selecting targets for the CIA’s drone strike kill lists via dubious algorithms, for instance, along with providing geospatial and other information for combatant commanders on land, air and sea, among many other functions. A single social media post on Twitter or Facebook is enough to trigger being placed on secret terrorism watch-lists solely due to a vaguely defined hunch or suspicion; and can potentially even land a suspect on a kill list.

    The push for indiscriminate, comprehensive mass surveillance by the military-industrial complex?—?encompassing the Pentagon, intelligence agencies, defense contractors, and supposedly friendly tech giants like Google and Facebook?—?is therefore not an end in itself, but an instrument of power, whose goal is self-perpetuation. But there is also a self-rationalizing justification for this goal: while being great for the military-industrial complex, it is also, supposedly, great for everyone else.

    The ‘long war’

    No better illustration of the truly chauvinistic, narcissistic, and self-congratulatory ideology of power at the heart of the military-industrial complex is a book by long-time Highlands Forum delegate, Dr. Thomas Barnett, The Pentagon’s New Map. Barnett was assistant for strategic futures in the Pentagon’s Office of Force Transformation from 2001 to 2003, and had been recommended to Richard O’Neill by his boss Vice Admiral Arthur Cebrowski. Apart from becoming a New York Times bestseller, Barnett’s book had been read far and wide in the US military, by senior defense officials in Washington and combatant commanders operating on the ground in the Middle East.

    Barnett first attended the Pentagon Highlands Forum in 1998, then was invited to deliver a briefing about his work at the Forum on December 7th 2004, which was attended by senior Pentagon officials, energy experts, internet entrepreneurs, and journalists. Barnett received a glowing review in the Washington Post from his Highlands Forum buddy David Ignatius a week later, and an endorsement from another Forum friend, Thomas Friedman, both of which helped massively boost his credibility and readership.

    Barnett’s vision is neoconservative to the root. He sees the world as divided into essentially two realms: The Core, which consists of advanced countries playing by the rules of economic globalization (the US, Canada, UK, Europe and Japan) along with developing countries committed to getting there (Brazil, Russia, India, China, and some others); and the rest of the world, which is The Gap, a disparate wilderness of dangerous and lawless countries defined fundamentally by being “disconnected” from the wonders of globalization. This includes most of the Middle East and Africa, large swathes of South America, as well as much of Central Asia and Eastern Europe. It is the task of the United States to “shrink The Gap,” by spreading the cultural and economic “rule-set” of globalization that characterizes The Core, and by enforcing security worldwide to enable that “rule-set” to spread.

    These two functions of US power are captured by Barnett’s concepts of “Leviathan” and “System Administrator.” The former is about rule-setting to facilitate the spread of capitalist markets, regulated via military and civilian law. The latter is about projecting military force into The Gap in an open-ended global mission to enforce security and engage in nation-building. Not “rebuilding,” he is keen to emphasize, but building “new nations.”

    For Barnett, the Bush administration’s 2002 introduction of the Patriot Act at home, with its crushing of habeas corpus, and the National Security Strategy abroad, with its opening up of unilateral, pre-emptive war, represented the beginning of the necessary re-writing of rule-sets in The Core to embark on this noble mission. This is the only way for the US to achieve security, writes Barnett, because as long as The Gap exists, it will always be a source of lawless violence and disorder. One paragraph in particular sums up his vision:

    “America as global cop creates security. Security creates common rules. Rules attract foreign investment. Investment creates infrastructure. Infrastructure creates access to natural resources. Resources create economic growth. Growth creates stability. Stability creates markets. And once you’re a growing, stable part of the global market, you’re part of the Core. Mission accomplished.”

    Much of what Barnett predicted would need to happen to fulfill this vision, despite its neoconservative bent, is still being pursued under Obama. In the near future, Barnett had predicted, US military forces will be dispatched beyond Iraq and Afghanistan to places like Uzbekistan, Djibouti, Azerbaijan, Northwest Africa, Southern Africa and South America.

    Barnett’s Pentagon briefing was greeted with near universal enthusiasm. The Forum had even purchased copies of his book and had them distributed to all Forum delegates, and in May 2005, Barnett was invited back to participate in an entire Forum themed around his “SysAdmin” concept.

    The Highlands Forum has thus played a leading role in defining the Pentagon’s entire conceptualization of the ‘war on terror.’ Irving Wladawsky-Berger, a retired IMB vice president who co-chaired the President’s Information Technology Advisory Committee from 1997 to 2001, described his experience of one 2007 Forum meeting in telling terms:

    “Then there is the War on Terror, which DoD has started to refer to as the Long War, a term that I first heard at the Forum. It seems very appropriate to describe the overall conflict in which we now find ourselves. This is a truly global conflict… the conflicts we are now in have much more of the feel of a battle of civilizations or cultures trying to destroy our very way of life and impose their own.”

    The problem is that outside this powerful Pentagon-hosted clique, not everyone else agrees. “I’m not convinced that Barnett’s cure would be any better than the disease,” wrote Dr. Karen Kwiatowski, a former senior Pentagon analyst in the Near East and South Asia section, who blew the whistle on how her department deliberately manufactured false information in the run-up to the Iraq War. “It would surely cost far more in American liberty, constitutional democracy and blood than it would be worth.”

    Yet the equation of “shrinking The Gap” with sustaining the national security of The Core leads to a slippery slope. It means that if the US is prevented from playing this leadership role as “global cop,” The Gap will widen, The Core will shrink, and the entire global order could unravel. By this logic, the US simply cannot afford government or public opinion to reject the legitimacy of its mission. If it did so, it would allow The Gap to grow out of control, undermining The Core, and potentially destroying it, along with The Core’s protector, America. Therefore, “shrinking The Gap” is not just a security imperative: it is such an existential priority, that it must be backed up with information war to demonstrate to the world the legitimacy of the entire project.

    Based on O’Neill’s principles of information warfare as articulated in his 1989 US Navy brief, the targets of information war are not just populations in The Gap, but domestic populations in The Core, and their governments: including the US government. That secret brief, which according to former senior US intelligence official John Alexander was read by the Pentagon’s top leadership, argued that information war must be targeted at: adversaries to convince them of their vulnerability; potential partners around the world so they accept “the cause as just”; and finally, civilian populations and the political leadership so they believe that “the cost” in blood and treasure is worth it.

    Barnett’s work was plugged by the Pentagon’s Highlands Forum because it fit the bill, in providing a compelling ‘feel good’ ideology for the US military-industrial complex.

    But neoconservative ideology, of course, hardly originated with Barnett, himself a relatively small player, even though his work was extremely influential throughout the Pentagon. The regressive thinking of senior officials involved in the Highlands Forum is visible from long before 9/11, which was ceased upon by actors linked to the Forum as a powerful enabling force that legitimized the increasingly aggressive direction of US foreign and intelligence policies.

    Yoda and the Soviets

    The ideology represented by the Highlands Forum can be gleaned from long before its establishment in 1994, at a time when Andrew ‘Yoda’ Marshall’s ONA was the primary locus of Pentagon activity on future planning.

    A widely-held myth promulgated by national security journalists over the years is that the ONA’s reputation as the Pentagon’s resident oracle machine was down to the uncanny analytical foresight of its director Marshall. Supposedly, he was among the few who made the prescient recognition that the Soviet threat had been overblown by the US intelligence community. He had, the story goes, been a lone, but relentless voice inside the Pentagon, calling on policymakers to re-evaluate their projections of the USSR’s military might.

    Except the story is not true. The ONA was not about sober threat analysis, but about paranoid threat projection justifying military expansionism. Foreign Policy’s Jeffrey Lewis points out that far from offering a voice of reason calling for a more balanced assessment of Soviet military capabilities, Marshall tried to downplay ONA findings that rejected the hype around an imminent Soviet threat. Having commissioned a study concluding that the US had overestimated Soviet aggressiveness, Marshall circulated it with a cover note declaring himself “unpersuaded” by its findings. Lewis charts how Marshall’s threat projection mind-set extended to commissioning absurd research supporting staple neocon narratives about the (non-existent) Saddam-al-Qaeda link, and even the notorious report by a RAND consultant calling for re-drawing the map of the Middle East, presented to the Pentagon’s Defense Policy Board on the invitation of Richard Perle in 2002.

    Investigative journalist Jason Vest similarly found from Pentagon sources that during the Cold War, Marshall had long hyped the Soviet threat, and played a key role in giving the neoconservative pressure group, the Committee on the Present Danger, access to classified CIA intelligence data to re-write the National Intelligence Estimate on Soviet Military Intentions. This was a precursor to the manipulation of intelligence after 9/11 to justify the invasion and occupation of Iraq. Former ONA staffers confirmed that Marshall had been belligerent about an imminent Soviet threat “until the very end.” Ex-CIA sovietologist Melvin Goodman, for instance, recalled that Marshall was also instrumental in pushing for the Afghan mujahideen to be provided with Stinger missiles?—?a move which made the war even more brutal, encouraging the Russians to use scorched earth tactics.

    Enron, the Taliban and Iraq

    The post-Cold War period saw the Pentagon’s creation of the Highlands Forum in 1994 under the wing of former defense secretary William Perry?—?a former CIA director and early advocate of neocon ideas like preventive war. Surprisingly, the Forum’s dubious role as a government-industry bridge can be clearly discerned in relation to Enron’s flirtations with the US government. Just as the Forum had crafted the Pentagon’s intensifying policies on mass surveillance, it simultaneously fed directly into the strategic thinking that culminating in the wars in Afghanistan and Iraq.

    On November 7th 2000, George W. Bush ‘won’ the US presidential elections. Enron and its employees had given over $1 million to the Bush campaign in total. That included contributing $10,500 to Bush’s Florida recount committee, and a further $300,000 for the inaugural celebrations afterwards. Enron also provided corporate jets to shuttle Republican lawyers around Florida and Washington lobbying on behalf of Bush for the December recount. Federal election documents later showed that since 1989, Enron had made a total of $5.8 million in campaign donations, 73 percent to Republicans and 27 percent to Democrats?—?with as many as 15 senior Bush administration officials owning stock in Enron, including defense secretary Donald Rumsfeld, senior advisor Karl Rove, and army secretary Thomas White.

    Yet just one day before that controversial election, Pentagon Highlands Forum founding president Richard O’Neill wrote to Enron CEO, Kenneth Lay, inviting him to give a presentation at the Forum on modernizing the Pentagon and the Army. The email from O’Neill to Lay was released as part of the Enron Corpus, the emails obtained by the Federal Energy Regulatory Commission, but has remained unknown until now.

    The email began “On behalf of Assistant Secretary of Defense (C3I) and DoD CIO Arthur Money,” and invited Lay “to participate in the Secretary of Defense’s Highlands Forum,” which O’Neill described as “a cross-disciplinary group of eminent scholars, researchers, CEO’s/CIO’s/CTO’s from industry, and leaders from the media, the arts and the professions, who have met over the past six years to examine areas of emerging interest to all of us.” He added that Forum sessions include “seniors from the White House, Defense, and other agencies of government (we limit government participation to about 25%).”

    Here, O’Neill reveals that the Pentagon Highlands Forum was, fundamentally, about exploring not just the goals of government, but the interests of participating industry leaders like Enron. The Pentagon, O’Neill went on, wanted Lay to feed into “the search for information/ transformation strategies for the Department of Defense (and government in general),” particularly “from a business perspective (transformation, productivity, competitive advantage).” He offered high praise of Enron as “a remarkable example of transformation in a highly rigid, regulated industry, that has created a new model and new markets.”

    O’Neill made clear that the Pentagon wanted Enron to play a pivotal role in the DoD’s future, not just in the creation of “an operational strategy which has information superiority,” but also in relation to the DoD’s “enormous global business enterprise which can benefit from many of the best practices and ideas from industry.”

    “ENRON is of great interest to us,” he reaffirmed. “What we learn from you may help the Department of Defense a great deal as it works to build a new strategy. I hope that you have time on your busy schedule to join us for as much of the Highlands Forum as you can attend and speak with the group.”

    That Highlands Forum meeting was attended by senior White House and US intelligence officials, including CIA deputy director Joan A. Dempsey, who had previously served as assistant defense secretary for intelligence, and in 2003 was appointed by Bush as executive director of the President’s Foreign Intelligence Advisory Board, in which capacity she praised extensive information sharing by the NSA and NGA after 9/11. She went on to become executive vice president at Booz Allen Hamilton, a major Pentagon contractor in Iraq and Afghanistan that, among other things, created the Coalition Provisional Authority’s database to track what we now know were highly corrupt reconstruction projects in Iraq.

    Enron’s relationship with the Pentagon had already been in full swing the previous year. Thomas White, then vice chair of Enron energy services, had used his extensive US military connections to secure a prototype deal at Fort Hamilton to privatize the power supply of army bases. Enron was the only bidder for the deal. The following year, after Enron’s CEO was invited to the Highlands Forum, White gave his first speech in June just “two weeks after he became secretary of the Army,” where he “vowed to speed up the awarding of such contracts,” along with further “rapid privatization” of the Army’s energy services. “Potentially, Enron could benefit from the speedup in awarding contracts, as could others seeking the business,” observed USA Today.

    That month, on the authority of defense secretary Donald Rumsfeld?—?who himself held significant shares in Enron?—?Bush’s Pentagon invited another Enron executive and one of Enron’s senior external financial advisors to attend a further secret Highlands Forum session.

    An email from Richard O’Neill dated June 22nd, obtained via the Enron Corpus, showed that Steven Kean, then executive vice president and chief of staff of Enron, was due to give another Highlands presentation on Monday 25th. “We are approaching the Secretary of Defense-sponsored Highlands Forum and very much looking forward to your participation,” wrote O’Neill, promising Kean that he would be “the centerpiece of discussion. Enron’s experience is quite important to us as we seriously consider transformative change in the Department of Defense.”

    Steven Kean is now president and COO (and incoming CEO) of Kinder Morgan, one of the largest energy companies in North America, and a major supporter of the controversial Keystone XL pipeline project.

    Due to attend the same Highlands Forum session with Kean was Richard Foster, then a senior partner at the financial consultancy McKinsey. “I have given copies of Dick Foster’s new book, Creative Destruction, to the Deputy Secretary of Defense as well as the Assistant Secretary,” said O’Neill in his email, “and the Enron case that he outlines makes for important discussion. We intend to hand out copies to the participants at the Forum.”

    Foster’s firm, McKinsey, had provided strategic financial advice to Enron since the mid-1980s. Joe Skilling, who in February 2001 became Enron CEO while Kenneth Lay moved to chair, had been head of McKinsey’s energy consulting business before joining Enron in 1990.

    McKinsey and then partner Richard Foster were intimately involved in crafting the core Enron financial management strategies responsible for the company’s rapid, but fraudulent, growth. While McKinsey has always denied being aware of the dodgy accounting that led to Enron’s demise, internal company documents showed that Foster had attended an Enron finance committee meeting a month before the Highlands Forum session to discuss the “need for outside private partnerships to help drive the company’s explosive growth”?—?the very investment partnerships responsible for the collapse of Enron.

    McKinsey documents showed that the firm was “fully aware of Enron’s extensive use of off-balance-sheet funds.” As The Independent’s economics editor Ben Chu remarks, “McKinsey fully endorsed the dubious accounting methods,” which led to the inflation of Enron’s market valuation and “that caused the company to implode in 2001.”

    Indeed, Foster himself had personally attended six Enron board meetings from October 2000 to October 2001. That period roughly coincided with Enron’s growing influence on the Bush administration’s energy policies, and the Pentagon’s planning for Afghanistan and Iraq.

    But Foster was also a regular attendee at the Pentagon Highlands Forum?—?his LinkedIn profile describes him as member of the Forum since 2000, the year he ramped up engagement with Enron. He also delivered a presentation at the inaugural Island Forum in Singapore in 2002.

    Enron’s involvement in the Cheney Energy Task Force appears to have been linked to the Bush administration’s 2001 planning for both the invasions of Afghanistan and Iraq, motivated by control of oil. As noted by Prof. Richard Falk, a former board member of Human Rights Watch and ex-UN investigator, Enron’s Kenneth Lay “was the main confidential consultant relied upon by Vice President Dick Cheney during the highly secretive process of drafting a report outlining a national energy policy, widely regarded as a key element in the US approach to foreign policy generally and the Arab world in particular.”

    The intimate secret meetings between senior Enron executives and high-level US government officials via the Pentagon Highlands Forum, from November 2000 to June 2001, played a central role in establishing and cementing the increasingly symbiotic link between Enron and Pentagon planning. The Forum’s role was, as O’Neill has always said, to function as an ideas lab to explore the mutual interests of industry and government.

    Enron and Pentagon war planning

    In February 2001, when Enron executives including Kenneth Lay began participating concertedly in the Cheney Energy Task Force, a classified National Security Council document instructed NSC staffers to work with the task force in “melding” previously separate issues: “operational policies towards rogue states” and “actions regarding the capture of new and existing oil and gas fields.”

    According to Bush’s treasury secretary Paul O’Neill, as quoted by Ron Suskind in The Price of Loyalty (2004), cabinet officials discussed an invasion of Iraq in their first NSC meeting, and had even prepared a map for a post-war occupation marking the carve-up of Iraq’s oil fields. The message at that time from President Bush was that officials must “find a way to do this.”

    Cheney Energy Task Force documents obtained by Judicial Watch under Freedom of Information revealed that by March, with extensive industry input, the task force had prepared maps of Gulf state and especially Iraqi oilfields, pipelines, and refineries, along with a list titled ‘Foreign Suitors for Iraqi Oilfield Contracts.’ By April, a think-tank report commissioned by Cheney, overseen by former secretary of state James Baker, and put together by a committee of energy industry and national security experts, urged the US government “to conduct an immediate policy review toward Iraq including military, energy, economic and political/diplomatic assessments,” to deal with Iraq’s “destabilizing influence” on oil flows to global markets. The report included recommendations from Highlands Forum delegate and Enron chair, Kenneth Lay.

    But Cheney’s Energy Task Force was also busily pushing forward plans for Afghanistan involving Enron, that had been in motion under Clinton. Through the late 1990s, Enron was working with California-based US energy company Unocal to develop an oil and gas pipeline that would tap Caspian basin reserves, and carry oil and gas across Afghanistan, supplying Pakistan, India and potentially other markets. The endeavor had the official blessing of the Clinton administration, and later the Bush administration, which held several meetings with Taliban representatives to negotiate terms for the pipeline deal throughout 2001. The Taliban, whose conquest of Afghanistan had received covert assistance under Clinton, was to receive formal recognition as the legitimate government of Afghanistan in return for permitting the installation of the pipeline. Enron paid $400 million for a feasibility study for the pipeline, a large portion of which was siphoned off as bribes to Taliban leaders, and even hired CIA agents to help facilitate.

    Then in summer 2001, while Enron officials were liaising with senior Pentagon officials at the Highlands Forum, the White House’s National Security Council was running a cross-departmental ‘working group’ led by Rumsfeld and Cheney to help complete an ongoing Enron project in India, a $3 billion power plant in Dabhol. The plant was slated to receive its energy from the Trans-Afghan pipeline. The NSC’s ‘Dabhol Working Group,’ chaired by Bush’s national security adviser Condoleeza Rice, generated a range of tactics to enhance US government pressure on India to complete the Dabhol plant?—?pressure that continued all the way to early November. The Dabhol project, and the Trans-Afghan pipeline, was by far Enron’s most lucrative overseas deal.

    Throughout 2001, Enron officials, including Ken Lay, participated in Cheney’s Energy Task Force, along with representatives across the US energy industry. Starting from February, shortly after the Bush administration took office, Enron was involved in about half a dozen of these Energy Task Force meetings. After one of these secret meetings, a draft energy proposal was amended to include a new provision proposing to dramatically boost oil and natural gas production in India in a way that would apply only to Enron’s Dabhol power plant. In other words, ensuring the flow of cheap gas to India via the Trans-Afghan pipeline was now a matter of US ‘national security.’

    A month or two after this, the Bush administration gave the Taliban $43 million, justified by its crackdown on opium production, despite US-imposed UN sanctions preventing aid to the group for not handing over Osama bin Laden.

    Then in June 2001, the same month that Enron’s executive vice president Steve Kean attended the Pentagon Highlands Forum, the company’s hopes for the Dabhol project were dashed when the Trans-Afghan pipeline failed to materialize, and as a consequence, construction on the Dabhol power plant was shut down. The failure of the $3 billion project contributed to Enron’s bankruptcy in December. That month, Enron officials met with Bush’s commerce secretary, Donald Evans, about the plant, and Cheney lobbied India’s main opposition party about the Dhabol project. Ken Lay had also reportedly contacted the Bush administration around this time to inform officials about the firm’s financial troubles.

    By August, desperate to pull off the deal, US officials threatened Taliban representatives with war if they refused to accept American terms: namely, to cease fighting and join in a federal alliance with the opposition Northern Alliance; and to give up demands for local consumption of the gas. On the 15th of that month, Enron lobbyist Pat Shortridge told then White House economic advisor Robert McNally that Enron was heading for a financial meltdown that could cripple the country’s energy markets.

    The Bush administration must have anticipated the Taliban’s rejection of the deal, because they had planned a war on Afghanistan from as early as July. According to then Pakistani foreign minister Niaz Naik, who had participated in the US-Taliban negotiations, US officials told him they planned to invade Afghanistan in mid-October 2001. No sooner had the war commenced, Bush’s ambassador to Pakistan, Wendy Chamberlain, called Pakistani’s oil minister Usman Aminuddin to discuss “the proposed Turkmenistan-Afghanistan-Pakistan gas pipeline project,” according to the Frontier Post, a Pakistani English-language broadsheet. They reportedly agreed that the “project opens up new avenues of multi-dimensional regional cooperation particularly in view of the recent geo-political developments in the region.”

    Two days before 9/11, Condoleeza Rice received the draft of a formal National Security Presidential Directive that Bush was expected to sign immediately. The directive contained a comprehensive plan to launch a global war on al-Qaeda, including an “imminent” invasion of Afghanistan to topple the Taliban. The directive was approved by the highest levels of the White House and officials of the National Security Council, including of course Rice and Rumsfeld. The same NSC officials were simultaneously running the Dhabol Working Group to secure the Indian power plant deal for Enron’s Trans-Afghan pipeline project. The next day, one day before 9/11, the Bush administration formally agreed on the plan to attack the Taliban.

    The Pentagon Highlands Forum’s background link with the interests involved in all this, show they were not unique to the Bush administration?—?which is why, as Obama was preparing to pull troops out of Afghanistan, he re-affirmed his government’s support for the Trans-Afghan pipeline project, and his desire for a US firm to construct it.

    The Pentagon’s propaganda fixer

    Throughout this period, information war played a central role in drumming up public support for war?—?and the Highlands Forum led the way.

    In December 2000, just under a year before 9/11 and shortly after George W. Bush’s election victory, key Forum members participated in an event at the Carnegie Endowment for International Peace to explore “the impact of the information revolution, globalization, and the end of the Cold War on the US foreign policy making process.” Rather than proposing “incremental reforms,” the meeting was for participants to “build from scratch a new model that is optimized to the specific properties of the new global environment.”

    Among the issues flagged up in the meeting was the ‘Global Control Revolution’: the “distributed” nature of the information revolution was altering “key dynamics of world politics by challenging the primacy of states and inter-state relations.” This was “creating new challenges to national security, reducing the ability of leading states to control global policy debates, challenging the efficacy of national economic policies, etc.”

    In other words, how can the Pentagon find a way to exploit the information revolution to “control global policy debates,” particularly on “national economic policies”?

    The meeting was co-hosted by Jamie Metzl, who at the time served on Bill Clinton’s National Security Council, where he had just led the drafting of Clinton’s Presidential Decision Directive 68 on International Public Information (IPI), a new multiagency plan to coordinate US public information dissemination abroad. Metzl went on to coordinate IPI at the State Department.

    The preceding year, a senior Clinton official revealed to the Washington Times that Metz’s IPI was really aimed at “spinning the American public,” and had “emerged out of concern that the US public has refused to back President Clinton’s foreign policy.” The IPI would plant news stories favorable to US interests via TV, press, radio and other media based abroad, in hopes it would get picked up in American media. The pretext was that “news coverage is distorted at home and they need to fight it at all costs by using resources that are aimed at spinning the news.” Metzl ran the IPI’s overseas propaganda operations for Iraq and Kosovo.

    Other participants of the Carnegie meeting in December 2000, included two founding members of the Highlands Forum, Richard O’Neill and SAIC’s Jeff Cooper?—?along with Paul Wolfowitz, another Andrew Marshall acolyte who was about to join the incoming Bush administration as Rumsfelds’ deputy defense secretary. Also present was a figure who soon became particularly notorious in the propaganda around Afghanistan and Iraq War 2003: John W. Rendon, Jr., founding president of The Rendon Group (TRG) and another longtime Pentagon Highlands Forum member.

    John Rendon (right) at the Highlands Forum, accompanied by BBC anchor Nik Gowing (left) and Jeff Jonas, IBM Entity Analytics chief engineer (middle)

    TRG is a notorious communications firm that has been a US government contractor for decades. Rendon played a pivotal role in running the State Department’s propaganda campaigns in Iraq and Kosovo under Clinton and Metzl. That included receiving a Pentagon grant to run a news website, the Balkans Information Exchange, and a US Agency for International Development (USAID) contract to promote “privatization.”

    Rendon’s central role in helping the Bush administration hype up the non-existent threat of weapons of mass destruction (WMD) to justify a US military invasion is now well-known. As James Bamford famously exposed in his seminal Rolling Stone investigation, Rendon played an instrumental role on behalf of the Bush administration in deploying “perception management” to “create the conditions for the removal of Hussein from power” under multi-million dollar CIA and Pentagon contracts.

    Among Rendon’s activities was the creation of Ahmed Chalabi’s Iraqi National Congress (INC) on behalf of the CIA, a group of Iraqi exiles tasked with disseminating propaganda, including much of the false intelligence about WMD. That process had begun concertedly under the administration of George H W. Bush, then rumbled along under Clinton with little fanfare, before escalating after 9/11 under George W. Bush. Rendon thus played a large role in the manufacture of inaccurate and false news stories relating to Iraq under lucrative CIA and Pentagon contracts?—?and he did so in the period running up to the 2003 invasion as an advisor to Bush’s National Security Council: the same NSC, of course, that planned the invasions of Afghanistan and Iraq, achieved with input from Enron executives who were simultaneously engaging the Pentagon Highlands Forum.

    But that is the tip of iceberg. Declassified documents show that the Highlands Forum was intimately involved in the covert processes by which key officials engineered the road to war on Iraq, based on information warfare.

    A redacted 2007 report by the DoD’s Inspector General reveals that one of the contractors used extensively by the Pentagon Highlands Forum during and after the Iraq War was none other than The Rendon Group. TRG was contracted by the Pentagon to organize Forum sessions, determine subjects for discussion, as well as to convene and coordinate Forum meetings. The Inspector General investigation had been prompted by accusations raised in Congress about Rendon’s role in manipulating information to justify the 2003 invasion and occupation of Iraq. According to the Inspector General report:

    “… the Assistant Secretary of Defense for Networks and Information Integration/Chief Information Officer employed TRG to conduct forums that would appeal to a cross-disciplinary group of nationally regarded leaders. The forums were in small groups discussing information and technologies and their effects on science, organizational and business processes, international relations, economics, and national security. TRG also conducted a research program and interviews to formulate and develop topics for the Highlands Forum focus group. The Office of the Assistant Secretary of Defense for Networks and Information Integration would approve the subjects, and TRG would facilitate the meetings.”

    TRG, the Pentagon’s private propaganda arm, thus played a central role in literally running the Pentagon Highlands Forum process that brought together senior government officials with industry executives to generate DoD information warfare strategy.

    The Pentagon’s internal investigation absolved Rendon of any wrongdoing. But this is not surprising, given the conflict of interest at stake: the Inspector General at the time was Claude M. Kicklighter, a Bush nominee who had directly overseen the administration’s key military operations. In 2003, he was director of the Pentagon’s Iraq Transition Team, and the following year he was appointed to the State Department as special advisor on stabilization and security operations in Iraq and Afghanistan.

    The surveillance-propaganda nexus

    Even more telling, Pentagon documents obtained by Bamford for his Rolling Stone story revealed that Rendon had been given access to the NSA’s top-secret surveillance data to carry out its work on behalf of the Pentagon. TRG, the DoD documents said, is authorized “to research and analyze information classified up to Top Secret/SCI/SI/TK/G/HCS.”

    ‘SCI’ means Sensitive Compartmented Information, data classified higher than Top Secret, while ‘SI’ designates Special Intelligence, that is, highly secret communications intercepted by the NSA. ‘TK’ refers to Talent/Keyhole, code names for imagery from reconnaissance aircraft and spy satellites, while ‘G’ stands for Gamma, encompassing communications intercepts from extremely sensitive sources, and ‘HCS’ means Humint Control System?—?information from a very sensitive human source. In Bamford’s words:

    “Taken together, the acronyms indicate that Rendon enjoys access to the most secret information from all three forms of intelligence collection: eavesdropping, imaging satellites and human spies.”

    So the Pentagon had:

    1. contracted Rendon, a propaganda firm;

     

    2. given Rendon access to the intelligence community’s most classified information including data from NSA surveillance;

     

    3. tasked Rendon to facilitating the DoD’s development of information operations strategy by running the Highlands Forum process;

     

    4. and further, tasked Rendon with overseeing the concrete execution of this strategy developed through the Highlands Forum process, in actual information operations around the world in Iraq, Afghanistan and beyond.

    TRG chief executive John Rendon remains closely involved in the Pentagon Highlands Forum, and ongoing DoD information operations in the Muslim world. His November 2014 biography for the Harvard Kennedy School ‘Emerging Leaders’ course describes him as “a participant in forward-thinking organizations such as the Highlands Forum,” “one of the first thought-leaders to harness the power of emerging technologies in support of real time information management,” and an expert on “the impact of emerging information technologies on the way populations think and behave.” Rendon’s Harvard bio also credits him with designing and executing “strategic communications initiatives and information programs related to operations, Odyssey Dawn (Libya), Unified Protector (Libya), Global War on Terrorism (GWOT), Iraqi Freedom, Enduring Freedom (Afghanistan), Allied Force and Joint Guardian (Kosovo), Desert Shield, Desert Storm (Kuwait), Desert Fox (Iraq) and Just Cause (Panama), among others.”

    Rendon’s work on perception management and information operations has also “assisted a number of US military interventions” elsewhere, as well as running US information operations in Argentina, Colombia, Haiti, and Zimbabwe?—?in fact, a total of 99 countries. As a former executive director and national political director of the Democratic Party, John Rendon remains a powerful figure in Washington under the Obama administration.

    Pentagon records show that TRG has received over $100 million from the DoD since 2000. In 2009, the US government cancelled a ‘strategic communications’ contract with TRG after revelations it was being used to weed out reporters who might write negative stories about the US military in Afghanistan, and to solely promote journalists supportive of US policy. Yet in 2010, the Obama administration re-contracted Rendon to supply services for “military deception” in Iraq.

    Since then, TRG has provided advice to the US Army’s Training and Doctrine Command, the Special Operations Command, and is still contracted to the Office of the Secretary of Defense, the US Army’s Communications Electronic Command, as well as providing “communications support” to the Pentagon and US embassies on counter-narcotics operations.

    TRG also boasts on its website that it provides “Irregular Warfare Support,” including “operational and planning support” that “assists our government and military clients in developing new approaches to countering and eroding an adversary’s power, influence and will.” Much of this support has itself been fine-tuned over the last decade or more inside the Pentagon Highlands Forum.

    Irregular war and pseudo-terrorism

    The Pentagon Highlands Forum’s intimate link, via Rendon, to the propaganda operations pursued under Bush and Obama in support of the ‘Long War,’ demonstrate the integral role of mass surveillance in both irregular warfare and ‘strategic communications.’

    One of the major proponents of both is Prof John Arquilla of the Naval Postgraduate School, the renowned US defense analyst credited with developing the concept of ‘netwar,’ who today openly advocates the need for mass surveillance and big data mining to support pre-emptive operations to thwart terrorist plots. It so happens that Arquilla is another “founding member” of the Pentagon’s Highlands Forum.

    Much of his work on the idea of ‘networked warfare,’ ‘networked deterrence,’ ‘information warfare,’ and ‘swarming,’ largely produced for RAND under Pentagon contract, was incubated by the Forum during its early years and thus became integral to Pentagon strategy. For instance, in Arquilla’s 1999 RAND study, The Emergence of Noopolitik: Toward an American Information Strategy, he and his co-author David Ronfeldt express their gratitude to Richard O’Neill “for his interest, support and guidance,” and to “members of the Highlands Forum” for their advance comments on the study. Most of his RAND work credits the Highlands Forum and O’Neill for their support.

    Prof. John Arquilla of the Naval Postgraduate School, and a founding member of the Pentagon Highlands Forum

    Arquilla’s work was cited in a 2006 National Academy of Sciences study on the future of network science commissioned by the US Army, which found based on his research that: “Advances in computer-based technologies and telecommunications are enabling social networks that facilitate group affiliations, including terrorist networks.” The study conflated risks from terror and activist groups: “The implications of this fact for criminal, terror, protest and insurgency networks has been explored by Arquilla and Ronfeldt (2001) and are a common topic of discussion by groups like the Highlands Forum, which perceive that the United States is highly vulnerable to the interruption of critical networks.” Arquilla went on to help develop information warfare strategies “for the military campaigns in Kosovo, Afghanistan and Iraq,” according to military historian Benjamin Shearer in his biographical dictionary, Home Front Heroes (2007)?—?once again illustrating the direct role played by certain key Forum members in executing Pentagon information operations in war theatres.

    In his 2005 New Yorker investigation, the Pulitzer Prize-winning Seymour Hersh referred to a series of articles by Arquilla elaborating on a new strategy of “countering terror” with pseudo-terror. “It takes a network to fight a network,” said Arquilla, drawing on the thesis he had been promoting in the Pentagon through the Highlands Forum since its founding:

    “When conventional military operations and bombing failed to defeat the Mau Mau insurgency in Kenya in the 1950s, the British formed teams of friendly Kikuyu tribesmen who went about pretending to be terrorists. These ‘pseudo gangs’, as they were called, swiftly threw the Mau Mau on the defensive, either by befriending and then ambushing bands of fighters or by guiding bombers to the terrorists’ camps.”

    Arquilla went on to advocate that western intelligence services should use the British case as a model for creating new “pseudo gang” terrorist groups, as a way of undermining “real” terror networks:

    “What worked in Kenya a half-century ago has a wonderful chance of undermining trust and recruitment among today’s terror networks. Forming new pseudo gangs should not be difficult.”

    Essentially, Arquilla’s argument was that as only networks can fight networks, the only way to defeat enemies conducting irregular warfare is to use techniques of irregular warfare against them. Ultimately, the determining factor in victory is not conventional military defeat per se, but the extent to which the direction of the conflict can be calibrated to influence the population and rally their opposition to the adversary. Arquilla’s ‘pseudo-gang’ strategy was, Hersh reported, already being implemented by the Pentagon:

    “Under Rumsfeld’s new approach, I was told, US military operatives would be permitted to pose abroad as corrupt foreign businessmen seeking to buy contraband items that could be used in nuclear-weapons systems. In some cases, according to the Pentagon advisers, local citizens could be recruited and asked to join up with guerrillas or terrorists…

    The new rules will enable the Special Forces community to set up what it calls ‘action teams’ in the target countries overseas which can be used to find and eliminate terrorist organizations. ‘Do you remember the right-wing execution squads in El Salvador?’ the former high-level intelligence official asked me, referring to the military-led gangs that committed atrocities in the early nineteen-eighties. ‘We founded them and we financed them,’ he said. ‘The objective now is to recruit locals in any area we want. And we aren’t going to tell Congress about it.’ A former military officer, who has knowledge of the Pentagon’s commando capabilities, said, ‘We’re going to be riding with the bad boys.’”

    Official corroboration that this strategy is now operational came with the leak of a 2008 US Army special operations field manual. The US military, the manual said, can conduct irregular and unconventional warfare by using surrogate non-state groups such as “paramilitary forces, individuals, businesses, foreign political organizations, resistant or insurgent organizations, expatriates, transnational terrorism adversaries, disillusioned transnational terrorism members, black marketers, and other social or political ‘undesirables.’” Shockingly, the manual specifically acknowledged that US special operations can involve both counterterrorism and “Terrorism,” as well as: “Transnational criminal activities, including narco-trafficking, illicit arms-dealing, and illegal financial transactions.” The purpose of such covert operations is, essentially, population control?—?they are “specifically focused on leveraging some portion of the indigenous population to accept the status quo,” or to accept “whatever political outcome” is being imposed or negotiated.

    By this twisted logic, terrorism can in some cases be defined as a legitimate tool of US statecraft by which to influence populations into accepting a particular “political outcome”?—?all in the name fighting terrorism.

    Is this what the Pentagon was doing by coordinating the nearly $1 billion of funding from Gulf regimes to anti-Assad rebels, most of which according to the CIA’s own classified assessments ended up in the coffers of violent Islamist extremists linked to al-Qaeda, who went on to spawn the ‘Islamic State’?

    The rationale for the new strategy was first officially set out in an August 2002 briefing for the Pentagon’s Defense Science Board, which advocated the creation of a ‘Proactive, Preemptive Operations Group’ (P2OG) within the National Security Council. P2OG, the Board proposed, must conduct clandestine operations to infiltrate and “stimulate reactions” among terrorist networks to provoke them into action, and thus facilitate targeting them.

    The Defense Science Board is, like other Pentagon agencies, intimately related with the Highlands Forum, whose work feeds into the Board’s research, which in turn is regularly presented at the Forum.

    According to the US intelligence sources who spoke to Hersh, Rumsfeld had ensured that the new brand of black operations would be conducted entirely under Pentagon jurisdiction, firewalled off from the CIA and regional US military commanders, and executed by its own secret special operations command. That chain of command would include, apart from the defense secretary himself, two of his deputies including the undersecretary of defense for intelligence: the position overseeing the Highlands Forum.

    Strategic communications: war propaganda at home and abroad

    Within the Highlands Forum, the special operations techniques explored by Arquilla have been taken up by several others in directions focused increasingly on propaganda?—?among them, Dr. Lochard, as seen previously, and also Dr. Amy Zalman, who focuses particularly on the idea of the US military using ‘strategic narratives’ to influence public opinion and win wars.

    Like her colleague, Highlands Forum founding member Jeff Cooper, Zalman was schooled in the bowels of SAIC/Leidos. From 2007 to 2012, she was a senior SAIC strategist, before becoming Department of Defense Information Integration Chair at the US Army’s National War College, where she focused on how to fine-tune propaganda to elicit the precise responses desired from target groups, based on complete understanding of those groups. As of summer last year, she became CEO of the World Futures Society.

    Dr. Amy Zalman, an ex-SAIC strategist, is CEO of the World Futures Society, and a long-time Pentagon Highlands Forum delegate consulting for the US government on strategic communications in irregular warfare

    In 2005, the same year Hersh reported that the Pentagon strategy of “stimulating reactions” among terrorists by provoking them was underway, Zalman delivered a briefing to the Pentagon Highlands Forum titled, ‘In Support of a Narrative Theory Approach to US Strategic Communication.’ Since then, Zalman has been a long-time Highlands Forum delegate, and has presented her work on strategic communications to a range of US government agencies, NATO forums, as well as teaching courses in irregular warfare to soldiers at the US Joint Special Operations University.

    Her 2005 Highlands Forum briefing is not publicly available, but the thrust of Zalman’s input into the information component of Pentagon special operations strategies can be gleaned from some of her published work. In 2010, when she was still attached to SAIC, her NATO paper noted that a key component of irregular war is “winning some degree of emotional support from the population by influencing their subjective perceptions.” She advocated that the best way of achieving such influence goes far further than traditional propaganda and messaging techniques. Rather, analysts must “place themselves in the skins of the people under observation.”

    Zalman released another paper the same year via the IO Journal, published by the Information Operations Institute, which describes itself as a “special interest group” of the Associaton of Old Crows. The latter is a professional association for theorists and practitioners of electronic warfare and information operations, chaired by Kenneth Israel, vice president of Lockheed Martin, and vice chaired by David Himes, who retired last year from his position as senior advisor in electronic warfare at the US Air Force Research Laboratory.

    In this paper, titled ‘Narrative as an Influence Factor in Information Operations,’ Zalman laments that the US military has “found it difficult to create compelling narratives?—?or stories?—?either to express its strategic aims, or to communicate in discrete situations, such as civilian deaths.” By the end, she concludes that “the complex issue of civilian deaths” should be approached not just by “apologies and compensation”?—?which barely occurs anyway?—?but by propagating narratives that portray characters with whom the audience connects (in this case, ‘the audience’ being ‘populations in war zones’). This is to facilitate the audience resolving struggles in a “positive way,” defined, of course, by US military interests. Engaging emotionally in this way with “survivors of those dead” from US military action might “prove to be an empathetic form of influence.” Throughout, Zalman is incapable of questioning the legitimacy of US strategic aims, or acknowledging that the impact of those aims in the accumulation of civilian deaths, is precisely the problem that needs to change?—?as opposed to the way they are ideologically framed for populations subjected to military action.

    ‘Empathy,’ here, is merely an instrument by which to manipulate.

    In 2012, Zalman wrote an article for The Globalist seeking to demonstrate how the rigid delineation of ‘hard power’ and ‘soft power’ needed to be overcome, to recognize that the use of force requires the right symbolic and cultural effect to guarantee success:

    “As long as defense and economic diplomacy remain in a box labeled ‘hard power,’ we fail to see how much their success relies on their symbolic effects as well as their material ones. As long as diplomatic and cultural efforts are stored in a box marked ‘soft power,’ we fail to see the ways in which they can be used coercively or produce effects that are like those produced by violence.”

    Given SAIC’s deep involvement in the Pentagon Highlands Forum, and through it the development of information strategies on surveillance, irregular warfare, and propaganda, it is hardly surprising that SAIC was the other key private defense firm contracted to generate propaganda in the run up to Iraq War 2003, alongside TRG.

    “SAIC executives have been involved at every stage… of the war in Iraq,” reported Vanity Fair, ironically, in terms of deliberately disseminating false claims about WMD, and then investigating the ‘intelligence failure’ around false WMD claims. David Kay, for instance, who had been hired by the CIA in 2003 to hunt for Saddam’s WMD as head of the Iraq Survey Group, was until October 2002 a senior SAIC vice president hammering away “at the threat posed by Iraq” under Pentagon contract. When WMD failed to emerge, President Bush’s commission to investigate this US ‘intelligence failure’ included three SAIC executives, among them Highlands Forum founding member Jeffrey Cooper. The very year of Kay’s appointment to the Iraq Survey Group, Clinton’s defense secretary William Perry?—?the man under whose orders the Highlands Forum was set-up?—?joined the board of SAIC. The investigation by Cooper and all let the Bush administration off the hook for manufacturing propaganda to legitimize war?—?unsurprisingly, given Cooper’s integral role in the very Pentagon network that manufactured that propaganda.

    SAIC was also among the many contractors that profited handsomely from Iraqi reconstruction deals, and was re-contracted after the war to promote pro-US narratives abroad. In the same vein as Rendon’s work, the idea was that stories planted abroad would be picked up by US media for domestic consumption.

    Delegates at the Pentagon’s 46th Highlands Forum in December 2011, from right to left: John Seely Brown, chief scientist/director at Xerox PARC from 1990–2002 and an early board member of In-Q-Tel; Ann Pendleton-Jullian, co-author with Brown of a manuscript, Design Unbound; Antonio and Hanna Damasio, a neurologist and neurobiologist respectively who are part of a DARPA-funded project on propaganda

    But the Pentagon Highlands Forum’s promotion of advanced propaganda techniques is not exclusive to core, longstanding delegates like Rendon and Zalman. In 2011, the Forum hosted two DARPA-funded scientists, Antonio and Hanna Damasio, who are principal investigators in the ‘Neurobiology of Narrative Framing’ project at the University of Southern California. Evoking Zalman’s emphasis on the need for Pentagon psychological operations to deploy “empathetic influence,” the new DARPA-backed project aims to investigate how narratives often appeal “to strong, sacred values in order to evoke an emotional response,” but in different ways across different cultures. The most disturbing element of the research is its focus on trying to understand how to increase the Pentagon’s capacity to deploy narratives that influence listeners in a way that overrides conventional reasoning in the context of morally-questionable actions.

    The project description explains that the psychological reaction to narrated events is “influenced by how the narrator frames the events, appealing to different values, knowledge, and experiences of the listener.” Narrative framing that “targets the sacred values of the listener, including core personal, nationalistic, and/or religious values, is particularly effective at influencing the listener’s interpretation of narrated events,” because such “sacred values” are closely tied with “the psychology of identity, emotion, moral decision making, and social cognition.” By applying sacred framing to even mundane issues, such issues “can gain properties of sacred values and result in a strong aversion to using conventional reasoning to interpret them.” The two Damasios and their team are exploring what role “linguistic and neuropsychological mechanisms” play in determining “the effectiveness of narrative framing using sacred values in influencing a listener’s interpretation of events.”

    The research is based on extracting narratives from millions of American, Iranian and Chinese weblogs, and subjecting them to automated discourse analysis to compare them quantitatively across the three languages. The investigators then follow up using behavioral experiments with readers/listeners from different cultures to gauge their reaction different narratives “where each story makes an appeal to a sacred value to explain or justify a morally-questionable behavior of the author.” Finally, the scientists apply neurobiological fMRI scanning to correlate the reactions and personal characteristics of subjects with their brain responses.

    Why is the Pentagon funding research investigating how to exploit people’s “sacred values” to extinguish their capacity for logical reasoning, and enhance their emotional openness to “morally-questionable behavior”?

    The focus on English, Farsi and Chinese may also reveal that the Pentagon’s current concerns are overwhelmingly about developing information operations against two key adversaries, Iran and China, which fits into longstanding ambitions to project strategic influence in the Middle East, Central Asia and Southeast Asia. Equally, the emphasis on English language, specifically from American weblogs, further suggests the Pentagon is concerned about projecting propaganda to influence public opinion at home.

    Rosemary Wenchel (left) of the US Department of Homeland Security with Jeff ‘Skunk’ Baxter, a former musician and now US defense consultant who has worked for contractors like SAIC and Northrup Grumman. SAIC/Leidos executive Jeff Cooper is behind them

    Lest one presume that DARPA’s desire to mine millions of American weblogs as part of its ‘neurobiology of narrative framing’ research is a mere case of random selection, an additional co-chair of the Pentagon Highlands Forum in recent years is Rosemary Wenchel, former director of cyber capabilities and operations support at the Office of the Secretary of Defense. Since 2012, Wenchel has been deputy assistant secretary for strategy and policy in the Department of Homeland Security.

    As the Pentagon’s extensive funding of propaganda on Iraq and Afghanistan demonstrates, population influence and propaganda is critical not just in far-flung theatres abroad in strategic regions, but also at home, to quell the risk of domestic public opinion undermining the legitimacy of Pentagon policy. In the photo above, Wenchel is talking to Jeff Baxter, a long-time US defense and intelligence consultant. In September 2005, Baxter was part of a supposedly “independent” study group (chaired by NSA-contractor Booz Allen Hamilton) commissioned by the Department of Homeland Security, which recommended a greater role for US spy satellites in monitoring the domestic population.

    Meanwhile, Zalman and Rendon, while both remaining closely involved in the Pentagon Highlands Forum, continue to be courted by the US military for their expertise on information operations. In October 2014, both participated in a major Strategic Multi-Layer Assessment conference sponsored by the US Department of Defense and the Joint Chiefs of Staff, titled ‘A New Information Paradigm? From Genes to “Big Data” and Instagram to Persistent Surveillance… Implications for National Security.’ Other delegates represented senior US military officials, defense industry executives, intelligence community officials, Washington think-tanks, and academics.

    John Rendon, CEO of The Rendon Group, at a Highlands Forum session in 2010

    Rendon and SAIC/Leidos, two firms that have been central to the very evolution of Pentagon information operations strategy through their pivotal involvement in the Highlands Forum, continue to be contracted for key operations under the Obama administration. A US General Services Administration document, for instance, shows that Rendon was granted a major 2010–2015 contract providing general media and communications support services across federal agencies. Similarly, SAIC/Leidos has a $400 million 2010–2015 contract with the US Army Research Laboratory for “Expeditionary Warfare; Irregular Warfare; Special Operations; Stabilization and Reconstruction Operations”?—?a contract which is “being prepared now for recomplete.”

    The empire strikes back

    Under Obama, the nexus of corporate, industry, and financial power represented by the interests that participate in the Pentagon Highlands Forum has consolidated itself to an unprecedented degree.

    Coincidentally, the very day Obama announced Hagel’s resignation, the DoD issued a media release highlighting how Robert O. Work, Hagel’s deputy defense secretary appointed by Obama in 2013, planned to take forward the Defense Innovation Initiative that Hagel had just announced a week earlier. The new initiative was focused on ensuring that the Pentagon would undergo a long-term transformation to keep up with leading edge disruptive technologies across information operations.

    Whatever the real reasons for Hagel’s ejection, this was a symbolic and tangible victory for Marshall and the Highlands Forum vision. Highlands Forum co-chair Andrew Marshall, head of the ONA, may indeed be retiring. But the post-Hagel Pentagon is now staffed with his followers.

    Robert Work, who now presides over the new DoD transformation scheme, is a loyal Marshall acolyte who had previously directed and analyzed war games for the Office of Net Assessment. Like Marshall, Wells, O’Neill and other Highlands Forum members, Work is also a robot fantasist who lead authored the study, Preparing for War in the Robotic Age, published early last year by the Center for a New American Security (CNAS).

    Work is also pitched to determine the future of the ONA, assisted by his strategist Tom Ehrhard and DoD undersecretary for intelligence Michael G. Vickers, under whose authority the Highlands Forum currently runs. Ehrard, an advocate of “integrating disruptive technologies in DoD,” previously served as Marshall’s military assistant in the ONA, while Mike Vickers?—?who oversees surveillance agencies like the NSA?—?was also previously hired by Marshall to consult for the Pentagon.

    Vickers is also a leading proponent of irregular warfare. As assistant defense secretary for special operations and low intensity conflict under former defense secretary Robert Gates in both the Bush and Obama administrations, Vickers’s irregular warfare vision pushed for “distributed operations across the world,” including “in scores of countries with which the US is not at war,” as part of a program of “counter network warfare” using a “network to fight a network”?—?a strategy which of course has the Highlands Forum all over it. In his previous role under Gates, Vickers increased the budget for special operations including psychological operations, stealth transport, Predator drone deployment and “using high-tech surveillance and reconnaissance to track and target terrorists and insurgents.”

    To replace Hagel, Obama nominated Ashton Carter, former deputy defense secretary from 2009 to 2013, whose expertise in budgets and procurement according to the Wall Street Journal is “expected to boost some of the initiatives championed by the current Pentagon deputy, Robert Work, including an effort to develop new strategies and technologies to preserve the US advantage on the battlefield.”

    Back in 1999, after three years as Clinton’s assistant defense secretary, Carter co-authored a study with former defense secretary William J. Perry advocating a new form of ‘war by remote control’ facilitated by “digital technology and the constant flow of information.” One of Carter’s colleagues in the Pentagon during his tenure at that time was Highlands Forum co-chair Linton Wells; and it was Perry of course that as then-defense secretary appointed Richard O’Neill to set-up the Highlands Forum as the Pentagon’s IO think-tank back in 1994.

    Highlands Forum overlord Perry went on to join the board of SAIC, before eventually becoming chairman of another giant defense contractor, Global Technology Partners (GTP). And Ashton Carter was on GTP’s board under Perry, before being nominated to defense secretary by Obama. During Carter’s previous Pentagon stint under Obama, he worked closely with Work and current undersecretary of defense Frank Kendall. Defense industry sources rejoice that the new Pentagon team will “dramatically improve” chances to “push major reform projects” at the Pentagon “across the finish line.”

    Indeed, Carter’s priority as defense chief nominee is identifying and acquiring new commercial “disruptive technology” to enhance US military strategy?—?in other words, executing the DoD Skynet plan.

    The origins of the Pentagon’s new innovation initiative can thus be traced back to ideas that were widely circulated inside the Pentagon decades ago, but which failed to take root fully until now. Between 2006 and 2010, the same period in which such ideas were being developed by Highlands Forum experts like Lochard, Zalman and Rendon, among many others, the Office of Net Assessment provided a direct mechanism to channel these ideas into concrete strategy and policy development through the Quadrennial Defense Reviews, where Marshall’s input was primarily responsible for the expansion of the “black” world: “special operations,” “electronic warfare” and “information operations.”

    Andrew Marshall, now retired head of the DoD’s Office of Net Assessment and Highlands Forum co-chair, at a Forum session in 2008

    Marshall’s pre-9/11 vision of a fully networked and automated military system found its fruition in the Pentagon’s Skynet study released by the National Defense University in September 2014, which was co-authored by Marshall’s colleague at the Highlands Forum, Linton Wells. Many of Wells’ recommendations are now to be executed via the new Defense Innovation Initiative by veterans and affiliates of the ONA and Highlands Forum.

    Given that Wells’ white paper highlighted the Pentagon’s keen interest in monopolizing AI research to monopolize autonomous networked robot warfare, it is not entirely surprising that the Forum’s sponsoring partners at SAIC/Leidos display a bizarre sensitivity about public use of the word ‘Skynet.’

    On a Wikipedia entry titled ‘Skynet (fictional)’, people using SAIC computers deleted several paragraphs under the ‘Trivia’ section pointing out real-world ‘Skynets’, such as the British military satellite system, and various information technology projects.

    Hagel’s departure paved the way for Pentagon officials linked to the Highlands Forum to consolidate government influence. These officials are embedded in a longstanding shadow network of political, industry, media and corporate officials that sit invisibly behind the seat of government, yet literally write its foreign and domestic national security policies whether the administration is Democrat of Republican, by contributing ‘ideas’ and forging government-industry relationships.

    It is this sort of closed-door networking that has rendered the American vote pointless. Far from protecting the public interest or helping to combat terrorism, the comprehensive monitoring of electronic communications has been systematically abused to empower vested interests in the energy, defense, and IT industries.

    The state of permanent global warfare that has resulted from the Pentagon’s alliances with private contractors and unaccountable harnessing of information expertise, is not making anyone safer, but has spawned a new generation of terrorists in the form of the so-called ‘Islamic State’?—?itself a Frankenstein by-product of the putrid combination of Assad’s brutality and longstanding US covert operations in the region. This Frankenstein’s existence is now being cynically exploited by private contractors seeking to profit exponentially from expanding the national security apparatus, at a time when economic volatility has pressured governments to slash defense spending.

    According to the Securities and Exchange Commission, from 2008 to 2013, the five largest US defense contractors lost 14 percent of their employees, as the winding down of US wars in Iraq and Afghanistan led to lack of business and squeezed revenues. The continuation of the ‘Long War’ triggered by ISIS has, for now, reversed their fortunes. Companies profiting from the new war include many connected to the Highlands Forum, such as Leidos, Lockheed Martin, Northrup Grumman, and Boeing. War is, indeed, a racket.

    No more shadows

    Yet in the long-run, the information imperialists have already failed. This investigation is based entirely on open source techniques, made viable largely in the context of the same information revolution that enabled Google. The investigation has been funded entirely by members of the public, through crowd-funding. And the investigation has been published and distributed outside the circuits of traditional media, precisely to make the point that in this new digital age, centralized top-down concentrations of power cannot overcome the power of people, their love of truth and justice, and their desire to share.

    What are the lessons of this irony? Simple, really: The information revolution is inherently decentralized, and decentralizing. It cannot be controlled and co-opted by Big Brother. Efforts to do so will in the end invariably fail, in a way that is ultimately self-defeating.

    The latest mad-cap Pentagon initiative to dominate the world through control of information and information technologies, is not a sign of the all-powerful nature of the shadow network, but rather a symptom of its deluded desperation as it attempts to ward off the acceleration of its hegemonic decline.

    But the decline is well on its way. And this story, like so many before it, is one small sign that the opportunities to mobilize the information revolution for the benefit of all, despite the efforts of power to hide in the shadows, are stronger than ever.

     

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Today’s News 29th August 2017

  • Christian Group Sues SPLC And Amazon After Being Labeled A "Hate Group"

    Last week D. James Kennedy Ministries (DJKM), a Christian-based missionary ministry based in Florida, filed a lawsuit against the Southern Poverty Law Center (SPLC) and Amazon after being added to the SPLC’s list of “hate groups” and excluded from Amazon’s charitable donation program, Amazon Smile.  Apparently, at least in the SPLC’s estimation, verbally expressing a religously-based opposition to same-sex marriage and transgenerism is enough to get yourself labeled an “Anti-LGBT hate group.”  Per PJ Media:

    “We embarked today on a journey to right a terrible wrong,” Dr. Frank Wright, president and CEO at DJKM, said in a statement Tuesday. “Those who knowingly label Christian ministries as ‘hate’ groups, solely for subscribing to the historic Christian faith, are either woefully uninformed or willfully deceitful. In the case of the Southern Poverty Law Center, our lawsuit alleges the latter.”

     

    The SPLC has labeled DJKM an “anti-LGBT hate group” for its opposition to same-sex marriage and transgenderism. “These false and illegal characterizations have a chilling effect on the free exercise of religion and on religious free speech for all people of faith,” Wright declared.

     

    “After having given the SPLC an opportunity to retract, we have undertaken this legal action, seeking a trial by a jury of our peers, to preserve our own rights under the law and to defend the religious free speech rights of all Americans,” the DJKM president concluded.

     

    The lawsuit laid out charges against the SPLC, GuideStar, and Amazon. “SPLC acted knowingly, intentionally, and with actual malice in publishing the Hate Map that included the Ministry and in publishing the SPLC Transmissions to GuideStar that included the ministry,” the suit alleged. “SPLC’s conduct in making these publications was beyond the reckless disregard for the truth standard required by Alabama law for punitive damages.”

    Of course, given that “same-sex marriage and transgenderism” generally do not comport with the views of most religious entities, it’s unclear exactly how/why all churches, mosques and synagogues in the U.S. managed to avoid being added the SPLC’s list…maybe DJKM just got lucky?

    In all, the SPLC says there are 917 “hate groups” in the United States which they divvy up into the following categories:

    • Anti-Immigrant
    • Anti-LGBT
    • Anti-Muslim
    • Black Separatist
    • Christian Indentity
    • General Hate
    • Hate Music
    • Holocaust Denial
    • KKK
    • Neo-Confederate
    • Neo-Nazi
    • Racist Skinhead
    • Radical Traditional Catholocism
    • White Nationalist

    Only in the U.S. can a peaceful Christian group end up on a “hate” list with “Neo-Nazis” and the “KKK”.  Be that as it may, here is where the SPLC says the “hate groups” of America are located (click here for an interactive version of the map).

     

    Among other things, DJKM’s lawsuit alleges that SPLC’s “hate group” designation has prevented them from being added to Amazon’s charitable registry.

    In early January of this year, a DJKM employee attempted to register the ministry with AmazonSmile, but was denied after multiple attempts. The program made clear, “We rely on the Southern Poverty Law Center to determine which charities are in ineligible categories,” and explained that DJKM was listed as ineligible.

     

    AmazonSmile support also noted that they “rely on GuideStar to send us information from the IRS,” and that GuideStar’s automated feed included the “hate” designation from the SPLC.

     

    AmazonSmile’s eligibility requirements exclude organizations that “engage in, support, encourage, or promote intolerance, hate, terrorism, violence, money laundering, or other illegal activities,” none of which DJKM engages in, the lawsuit argued.

    Meanwhile, not that it matters because it’s just a silly little fact, the 2015 Supreme court decision that legalized same-sex marriage specifically found that “religious based opposition to same-sex marriage and the homosexual agenda is not hate speech”…but what does SCOTUS know about laws anyway?

    But the lawsuit quoted Supreme Court Justice Anthony Kennedy, who in the 2015 case which legalized same-sex marriage wrote, “Many who deem same-sex marriage to be wrong reach that conclusion based on decent and honorable religious or philosophical premises, and neither they nor their beliefs are disparaged here.”

     

    “Therefore, as a matter of law, religious based opposition to same-sex marriage and the homosexual agenda is not hate speech, but rather is a position that the U.S. Supreme Court has labeled ‘decent and honorable,'” the suit explained.

     

    “Because the Ministry’s position on ‘LGBT’ issues is inextricably intertwined and connected to the Ministry’s religious theology, and because SPLC and GuideStar have declared the ministry to be a Hate Group due to the Ministry’s stand on LGBT issues, what occurred here is that SPLC and GuideStar have discriminated against the Ministry because of its … religious beliefs.”

    Not surprisingly, the mainstream media has embraced, without question, the SPLC’s list of “hate groups” with CNN publishing their map earlier this month.  Meanwhile, Apple pledged to donate $2 million to the SPLC and Anti-Degamation League in the wake of the Charlottesville attack.

    Here is DJKM’s President Dr. Frank Wright discussing the lawsuit on Fox News:

     

    Oddly, we didn’t see any mention of AntiFa groups on SPLC’s map…

  • How The Deep State Ties Down Trump

    Authored by Alastair Crooke via ConsortiumNews.com,

    America’s Deep State players have tied down President Trump on Russian sanctions and other foreign and economic policies but that doesn’t mean the struggle is over…

    President Trump has had his foreign policy hands and feet tied by the Russia (and Iran) Sanctions Act. 

    He now has been rendered “helpless”: in respect to détente with Russia — gulliverized, spitefully, by his own party, working with the Democrats, to empty Trump’s constitutional prerogatives in foreign policy – and to seize them for Congress.

    President Donald Trump announces the selection of Gen. H.R. McMaster as his new National Security Adviser on Feb. 20, 2017. (Screen shot from Whitehouse.gov)

    And in a further humiliation, Trump has been “rolled” by his military minders (Generals James Mattis, H.R. McMaster and John Kelly) on his Afghan policy: he has relinquished civilian oversight of this military expedition in Afghanistan to McMaster and Mattis — the former being the presumed author of the “new” Afghan policy. The President was “rolled” on his foreign military prerogatives too – as Commander in Chief – by his triumvirate of military minders in the White House. The “civilian” leadership has given place to the “military.”

    The question is whether these humiliating concessions will appease his opponents sufficiently to allow the President to “live on,” albeit as an incapacitated President, or is this just the hors d’oeuvre? It seems that the entrée may be being planned as the complete discrediting of Trump’s base – ordinary Republicans being lashed to the Trump “Titanic” – to be sunk along with its captain – as “white-supremacists, white bigots and Nazis.”

    Professor Walter Russell Mead – and he should know – tells us that “President Trump’s highest officials remain committed, one way or another, to defending the global order the U.S. has been building since the Truman era. That includes [Secretary of State RexTillerson, Mattis, Kelly and McMaster]: These men share a disdain for the Obama administration’s retrenchment and retreat. … They want to check the ambitions of America’s rivals, while restoring the foundations, both military and economic, of U.S. world power.”

    Ok – that is clear: they want to “grasp” America as world orderThey have been trying that for some time now, but have not yet succeeded in seizing “her.” With all “her” allure and riches, their quarry remains frustratingly elusive, and her very unattainability seems to madden “ego” even more  – so that which cannot be “had,” must be despoiled.

    What else accounts for the new Afghan plan? Almost nobody (outside of the U.S. élites) believes it will do other than prolong an unwinnable war (or worse, push Pakistan and India into confrontation). Yet the further despoliation of Afghanistan must go on, for the sake of the myth of this America – of Trump’s “highest officials” – that America is always victorious, if only it wills it sufficiently, and is persistent – “defeat” as heresy.

    It is a familiar story of inflated ego. But the sense of power and wanting to “grasp at something unattainable” is so compelling, that the U.S. élites desire both to crush the “infuriating” Trump, and his “deplorables” – to thrust them down into the irrecoverable depths – while weakening any external rival that might hinder the way to their “having” America, as world order.

    A Frenzied Deep State

    It seems that the American deep state is so frenzied in this way that its inhabitants can no longer see straight: they are ready to risk despoiling not just the “recalcitrant” abroad, but America herself. And the way they are going about trying to “have her,” may well ruin the deep state too, as collateral damage.

    Russian President Vladimir Putin meets with U.S. President Donald Trump at the G-20 summit in Hamburg, Germany, on July 7, 2017. (Screen shot from Whitehouse.gov)

    The Russia Sanctions Act may have been conceived both to paralyze President Trump, and to validate the “Putin-stole-the-Election” narrative, but it precisely removes any chance of Messrs Mattis, McMaster, Kelly and Tillerson to succeed with seizing America as world proconsul.

    Russia, China and Iran, now linked by again being threatened by sanctions, are now firmly embedded into a strategic coalition – and they are determined to resist.

    Incredibly, as one commentator put it: “During the ramp up to new UN sanctions on North Korea, the Trump administration threatened to sanction China if it did not commit to further pressure [on N. Korea] … Trump himself implied that he was willing for a quid pro quo: ‘If China helps us, I feel a lot differently toward trade, a lot differently toward trade’, [Trump] told reporters …

    “A deal was made, and the UN Resolution 2371 passed … China did its part of the deal: It helped pass the UN resolution against North Korea – and it immediately implemented it, even though that caused a significant loss for Chinese companies which trade with North Korea. [But …]

     

    “Now Trump is back at sanctioning Chinese (and Russian) companies: The Trump administration on Tuesday imposed sanctions on 16 mainly Chinese and Russian companies and people for assisting North Korea’s nuclear and ballistic missile programs and helping the North make money to support those programs …

     

    “Among those sanctioned are six Chinese companies, including three coal companies; two Singapore-based companies that sell oil to North Korea and three Russians that work with them; a Russian company that deals in North Korean metals and its Russian director; a construction company based in Namibia; a second Namibia-based company, and its North Korean director, that supplies North Korean workers to build statues overseas to generate income for the North.

     

    “These are ‘secondary sanctions’ which block financial transactions and make it nearly impossible for those companies and people to run an international business. Moreover – China had already banned all coal imports from North Korea. It had sent back North Korean coal ships, and instead bought coal from the United States. [And] now, Chinese companies are getting sanctioned over North Korean coal that they no longer buy? Furthermore, selling fuel oil to North Korea is explicitly allowed under the new UN sanctions…”

    The alliance of these three states and their “partner forces” no longer believe that America is capable of serious diplomacy, or that it enjoys any real capacity to “seize” the world. On the contrary, they see Europe drifting away from the U.S., the Gulf Cooperation Council in disarray, and even Israel is despairing of its Washington ally. They do remain concerned about North Korea, but the fear of U.S. pre-emptive military action against North Korea is tempered by the knowledge that North Korea effectively holds 30,000 U.S. servicemen hostage in the de-militarized zone.

    The primary focus is now shifting to how these states might protect themselves, if the two sides in the U.S. internal conflict succeed in each despoiling one another, and thereby throw the world into financial turmoil (hence the flurry of activity in arranging local currency contracts and currency swaps):

    “When Steve Bannon was ejected from the White House, last week,” the New Yorker quotes Bannon as citing “his frustrations with the coming tax bill, as one of the reasons he believed that the Trump nationalist agenda had been hijacked by the so-called globalists, such as Cohn and the other members of the Big Six.”

    Yes, Trump has been “rolled” in the economic sphere, too: The “big six” consist of four members of Congress (including Senate Majority Leader Mitch McConnell and House Speaker Paul Ryan), plus economic adviser Gary Cohn and Treasury Secretary Steve Mnuchin – both of Goldman Sachs.

    “They’re not populists, they’re not nationalists, they had no interest in his [i.e. Trump’s] program – Zero”, Bannon told the Weekly Standard, “On what element of Trump’s program, besides tax cuts — which is going to be the standard marginal tax cut — where have they rallied to Trump’s cause? They haven’t.”

    The Power of Cohn

    “In the Bannon-era, factionalized Trump White House, Cohn was not just the head of the National Economic Council but the leader of the group of officials whom Bannon derided as ‘New York.’ (Breitbart stories called Cohn and his companions at the N.E.C. ‘Globalist Swampsters’)”, notes the New Yorker.

    White House economic adviser Gary Cohn.

    Cohn, who is 56, was brought into the Administration by Jared Kushner, the President’s son-in-law, who once interned for Cohn at Goldman Sachs. Cohn is a long-time donor to Democratic candidates.

    So, Trump’s “reflation trade” is being “normalized” by the “big six” – more of the usual D.C. politics.

    But, why be concerned if the U.S. stock market is hitting new highs every day? Indeed, the “market” has ridden an “ascending curve for 101 months since March 2009, during which the S&P 500 rose by 270% and rarely dropped by more than 2-4%, without [its members] coming to believe that nothing mattered except hitting the bid [button] during the more than 50 intervals when the stock market momentarily faltered. Virtually without exception, each shallow dip was accompanied by easy money ‘buy’ signals from the central banks, or selective ‘green shoots’ [releases] among the in-coming data.”

    As David Stockman writes:

    “After 101 months of dip buying … the headline reading algos [robot computer traders] have become programmed in a completely asymmetrical manner. They are triggered to ‘buy’ on economic/policy good news (because it implies more profits); but also to ‘buy’ on bad news (because it means more [liquidity] accommodation, and market-support/price keeping actions by the Fed and other central banks.

     

    “But this beneficent arrangement also encourages even prudent gamblers to minimize the amount of downside hedging insurance they purchase to protect their often heavily leveraged (through options and derivatives) book of longs.”

    Stockman is warning that markets already are trading at historic highs, and that no one is paying attention to these extreme valuations or the economic or political fundamentals – simply because the latter has become utterly irrelevant, if every small market dip, is immediately followed by the unbroken elevation of all asset classes (thanks to Central Bank interventions).

    “That is, the gamblers and robo-machines have become so hard-wired to the expectation that the central banking and fiscal branches of the state will do ‘whatever it takes’ to keep the stock averages rising, that it has become irrational to waste time and resources on parsing ‘whatever is going on,’” Instead, writes Stockman, “it’s all about the chart points, money flows, next in rotation sectors, ETF buying power, momentum trades and technical arbitrages, such as embodied in the currently massive risk parity trades.”

    In short, all sensibility to risk (political or credit or any other) has been expunged by the determination of the Central Banks to keep asset prices inflating higher. The financial system precisely is looking the other way — intent on making money “when the going is easy” – and consequently, any crisis now will create a disproportionate impact on those levered asset values, magnified by the trades today being all one-way.

    A Zombiefied Trump

    Here is the point: Will the political zombiefication of President Trump satisfy the two party Establishments? Are they mollified enough, to come together to agree on a budget and a new “clean” debt ceiling (the “ceiling” arrives on Sept. 29)? And, even if achieved, will so-called “normalization” of Trump policies really take the U.S. back to the nirvana of “how things used to be”?

    The Wall Street bull statue by Arturo Di Modica

    Ostensibly, “normalization” of Trump’s economic policy should be manageable: Ryan and McConnell would need only to line up a modest number of Democratic votes (together with Republican foot-soldiers), to enact a debt ceiling increase. But it may be more complicated – much more complicated than that: Should the Democrats cooperate (and they will want to appear that they are co-operating in order to avoid blame for any subsequent Federal shut-down), it will be only on the basis of “an onerous quid pro quo that requires Trump to give up the Mexican Wall; tax cuts for the wealthy; his proposed deep domestic spending cuts, and also to fund the insurance company bailouts that are needed to forestall drastic premium increases and coverage cancellations during the 2018 insurance (and election) year.”

    Certainly, the Democrats will present a public face of co-operation, but such is the angry temper of Washington today (with both sides looking for a fight), that almost certainly they will require their revenge pound of flesh cut from Trump’s side. The Freedom Caucus group of Republicans (which is linked to Bannon) might then jump ship, leaving the Big Six with either “no ceiling deal” or a “Democratic”-shaped budget.

    Trump tweeted: “I requested that Mitch M & Paul R tie the Debt Ceiling legislation into the popular V.A. Bill (which just passed) for easy approval. They didn’t do it so now we have a big deal with Dems holding them up (as usual) on Debt Ceiling approval. Could have been so easy-now a mess!”

    Axios reports that “top White House and GOP leadership officials tell us [Axios], the chances of a market-rattling government shutdown are rising by the day — and were [such] even before Trump threatened at his raucous Phoenix rally on Tuesday night, to use a shutdown as leverage to get funding for the [Mexican] border wall.”

    Quoting a “top Republican source” who puts the chance as high as 75 percent, Axios adds that “the peculiar part is that almost everyone I talk to on the Hill, agrees that it is more likely than not.”

    The Democrats seem determined to remove any provision for “the wall,” and Trump seems to be spoiling for a fight with the Democrats (and Ryan and McConnell) on this issue. He has had to acquiesce to being “rolled” in foreign and defense policy — might he turn, and dig in his heels? He is already channeling the blame onto the Republican Establishment leadership.

    If so, what price the continuation of a market historic “high” and brimming with complacency?

    Russia and China are right to be thinking “worst case” and how to minimize their exposure to any American cataclysmic descent into political turmoil – and possible violence.

  • China Is Planning ICO Crackdown, Threatens Life In Prison For Crypto Fund Fraud

    Earlier this year, Chinese digital currency exchanges temporarily halted customer withdrawals to upgrade their AML controls at the behest of financial regulators. The halt, which lasted for months, caused a temporary chill in the local bitcoin market, causing China to forfeit its position as the world’s largest bitcoin market. Now, Chinese regulators have signaled that they intend to stage a similar crackdown on initial coin offerings, the latest blockchain-related investing craze.  

    According to CoinDesk, draft legislation meant to curb so-called "illegal fundraising" includes a provision that targets ICOs.

    Here’s more from CoinDesk (translation theirs).

    "If the department overseeing illegal fundraising activities found a fundraising without proper permission, or a fundraising that violates the relevant provisions of the State, and if one of the following circumstances is found, the department shall launch an administrative investigation. Other relevant departments shall cooperate with the investigation.

    (2) to raise funds in the name of issuing or transferring equity, raising funds, selling insurance, or engaging in asset management activities, virtual currency, leasing, credit cooperation and mutual funds…"

    According to CoinDesk, the draft would require the government to establish an interdepartmental committee to combat illegal fundraising. It also clarified that participants of illegal fundraising would be responsible for their own losses. The release of the draft legislation follows widespread outrage directed at cryptocurrency-related scams. Last month, several college graduates in Tianjin, China were found dead after being imprisoned and assaulted by members of a pyramid-selling organization.

    Two Chinese laws presently govern how criminal courts handle unlawful fundraising.  According to CoinTelegraph, the crime of illegally absorbing public deposits carries a maximum penalty of 10 years of imprisonment. The crime of fund fraud, meanwhile, carries a maximum sentence of life in prison.

    Now the question is, if such heavy-handed penalties are tied to the law currently under consideration, will the law have a chilling effect on the ICO market? Or will it successfully eliminate fraud and abuse?

    According to a team of analysts at Pitchbook, ICO have raised more than $1 billion this year, and are expected to raise as much as $1.7 billion. Earlier this month, the SEC ruled that tokens produced in ICOs meet the definition of a security, and therefore must be registered with the commission. Though exactly how ICOs will be regulated in the US remains somewhat vague.

     

  • South Korea Releases Footage Of Ballistic Missile Test Capable Of "Mass Retaliation"

    Just hours after North Korea fired a ballistic missile across Japan, South Korea has released footage of its testing of a new ballistic missile, in a show of “overwhelming force.”


    While The White House has yet to respond to North Korea’s provocation, South Korea’s Blue House has stated that:

    “We are considering the development of strategic assets in the US and we will consult with the United States.”

    US strategic weapons include B-1B strategic bombers, B-52 long-range nuclear bombers, stealth fighters, Aegis destroyers, and nuclear propulsion submarines.

    But not wanting to rely solely on Trump, Yonhap reports the release of the following 86-second-long video clip showing the test-firing of a 500-kilometer-range ballistic missile with improved warhead power and that of another one with a range of 800 km. 

    The footage shows the missile being fired and accurately hitting mock targets on the ground and in the water.

    It was released by the state-run Agency for Defense Development (ADD)…

    We conducted the last flight test on the 24th to deploy the new 500-km ballistic missile and the 800-km ballistic missile, which are being developed under the leadership of the National Defense Science Institute.”

     

    We are building a Korean three-axis system to respond to North Korea’s threats. To achieve this, we have developed a new ballistic missile (BM) with increased range and increased accuracy through diversification of warheads and improved accuracy. “

     

    The 500-kilometer ballistic missile is “a new type of ballistic missile capable of accurately penetrating and destroying all of North Korea’s core facilities and is a key force in mass retaliation.”

  • Paul Craig Roberts On "The Weaponization Of History And Journalism"

    Authored by Paul Craig Roberts,

    "…we don’t need no stinkin’ facts…"

    In the United States, facts, an important element of truth, are not important. They are not important in the media, politics, universities, historical explanations, or the courtroom. Non-factual explanations of the collapse of three World Trade Center buildings are served up as the official explanation. Facts have been politicized, emotionalized, weaponized and simply ignored. As David Irving has shown, Anglo-American histories of World War 2 are, for the most part, feel-good histories, as are “civil war” histories as Thomas DiLorenzo and others have demonstrated. Of course, they are feel good only for the victors. Their emotional purpose means that inconvenient facts are unpalatable and ignored.

    Writing the truth is no way to succeed as an author. Only a small percentage of readers are interested in the truth. Most want their biases or brainwashing vindicated. They want to read what they already believe. It is comforting, reassuring. When their ignorance is confronted, they become angry. The way to be successful as a writer is to pick a group and give them what they want. There is always a market for romance novels and for histories that uphold a country’s myths. On the Internet successful sites are those that play to one ideology or another, to one emotion or the other, or to one interest group or another. The single rule for success is to confine truth to what the readership group you serve believes.

    Keep this in mind when you receive shortly my September quarterly request for your support of this website. There are not many like it. This site does not represent an interest group, an ideology, a hate group, an ethnic group or any cause other than truth. This is not to say that this site is proof against error. It is only to say that truth is its purpose.

    Karl Marx said that there were only class truths.

    Today we have a large variety of truths: truths for feminists, truths for blacks, Muslims, Hispanics, homosexuals, transgendered, truths for the foreign policy community that serves the military/security complex, truths for the neocons, truths for the One Percent that control the economy and the economists who serve them, truths for “white supremacists,” itself a truth term for their opponents. You can add to the list. The “truth” in these “truths” is that they are self-serving of the group that expresses them. Their actual relation to truth is of no consequence to those espousing the “truths.”

    Woe to you if you don’t go along with someone’s or some group’s truth. Not even famous film-maker Oliver Stone is immune. Recently, Stone expressed his frustration with the “False Flag War Against Russia.”  Little doubt that Stone is frustrated with taunts and accusations from completely ignorant media talking heads in response to his documentary, Putin, based on many hours of interviews over two years. Stone came under fire, because instead of demonizing Putin and Russia, thus confirming the official story, he showed us glimpses of the truth.

    The organization, Veteran Intelligence Professionals for Sanity, published a report that completely destroyed the false accusations about Trump/Russian hacking of the US presidential election. The Nation published an objective article about the report and was assaulted by writers, contributors, and readers for publishing information that weakens the case, which the liberal/progressive/left in conjunction with the military/security complex, is orchestrating against Trump. The magazine’s audience felt that the magazine had an obligation not to truth but to getting Trump out of office. Reportedly, the editor is considering whether to recall the article.

    So here we have left-leaning Oliver Stone and leftwing magazine, The Nation, under fire for making information available that is out of step with the self-serving “truth” to which the liberal/progressive/left and their ally, the military/security complex, are committed.

    When a country has a population among whom there are no truths except group-specific truths, the country is so divided as to be over and done with. “A house divided against itself cannot stand.” The white liberal/progressive/left leaders of divisive Identity Politics have little, if any, comprehension of where the movement they think they lead is headed. At the moment the hate is focused on the “alt-right,” which has become “white nationalists,” which has become “white supremacists.” These “white supremacists” have become epitomized by statues of Confederate soldiers and generals. All over the South, if local governments are not removing the statues, violent crazed thugs consumed by hate attempt to destroy them. In New Orleans someone with money bused in thugs from outside flying banners that apparently are derived from a communist flag to confront locals protesting the departure of their history down the Orwellian Memory Hole.

    What happens when all the monuments are gone? Where does the hate turn next? Once non-whites are taught to hate whites, not even self-hating whites are safe. How do those taught hate tell a good white from a bad white? They can’t and they won’t. By definition by Identity Politics, whites, for now white heterosexual males, are the victimizers and everyone else is their victim. The absurdity of this concept is apparent, yet the concept is unshaken by its absurdity. White heterosexual males are the only ones without the privilege of quotas. They and only they can be put at the back of the bus for university admissions, employment, promotion, and only their speech is regulated. They, and only they, can be fired for using “gender specific terms,” for using race specific terms, for unknowingly offending some preferred group member by using a word that is no longer permissible. They can be called every name in the book, beginning with racist, misogynist, and escalating, and no one is punished for the offense.

    Recently, a professor in the business school of a major university told me that he used the word, girls, in a marketing discussion. A young womyn was offended. The result was he received a dressing down from the dean. Another professor told me that at his university there was a growing list of blacklisted words. It wasn’t clear whether the list was official or unofficial, simply professors trying to stay up with Identity Politics and avoid words that could lead to their dismissal. Power, they tell me, is elsewhere than in the white male, the true victimized class.

    For years commentators have recognized the shrinking arena of free speech in the United States. Any speech that offends anyone but a white male can be curtailed by punishment. Recently, John Whitehead, constitutional attorney who heads the Rutherford Institute, wrote that it is now dangerous just to defend free speech. Reference to the First Amendment suffices to bring denunciation and threats of violence. Ron Unz notes that any website that can be demonized as “controversial” can find itself disappeared by Internet companies and PayPal. They simply terminate free speech by cutting off service.

    It must be difficult to teach some subjects, such as the “civil war” for example. How would it be possible to describe the actual facts? For example, for decades prior to the Union’s invasion of the Confederacy North/South political conflict was over tariffs, not over slavery.

    The fight over which new states created from former “Indian” territories would be “slave” and which “free” was a fight over keeping the protectionist (North) vs. free trade (South) balance in Congress equal so that the budding industrial north could not impose a tariff regime. Two days before Lincoln’s inaugural address, a stiff tariff was signed into law. That same day in an effort to have the South accept the tariff and remain in or return to the Union—some southern states had seceded, some had not—Congress passed the Corwin amendment that provided constitutional protection to slavery. The amendment prohibited the federal government from abolishing slavery.

    Two days later in his inaugural address, which seems to be aimed at the South, Lincoln said: “I have no purpose, directly or indirectly, to interfere with the institution of slavery in the States where it exists. I believe I have no lawful right to do so, and I have no inclination to do so.”

    Lincoln’s beef with the South was not over slavery or the Fugitive Slave Act. Lincoln did not accept the secessions and still intended to collect the tariff that now was law. Under the Constitution slavery was up to the states, but the Constitution gave the federal government to right to levy a tariff. Lincoln said that “there needs to be no bloodshed or violence” over collecting the tariff. Lincoln said he will use the government’s power only “to collect the duties and imposts,” and that “there will be no invasion, no using of force against or among the people anywhere.”

    Here is Lincoln, “the Great Emancipator,” telling the South that they can have slavery if they will pay the duties and imposts on imports. How many black students and whites brainwashed by Identity Politics are going to sit there and listen to such a tale and not strongly protest the racist professor justifying white supremacy and slavery?

    So what happens to history when you can’t tell it as it is, but instead have to refashion it to fit the preconceived beliefs formed by Identity Politics? The so-called “civil war,” of course, is far from the only example.

    In its document of secession, South Carolina made a case that the Constitutional contract had been broken by some of the northern states breaking faith with Article IV of the Constitution. This is true. However, it is also true that the Southern states had no inclination to abide by Section 8 of Article I, which says that “Congress shall have power to lay and collect taxes, duties, imposts and excises.” So, also the South by not accepting the tariff was not constitutionally pure.

    Before history became politicized, historians understood that the North intended for the South to bear costs of the North’s development of industry and manufacturing. The agricultural South preferred the lower priced goods from England. The South understood that a tariff on British goods would push import prices above the high northern prices and lower the South’s living standards in the interest of raising living standards in the North. The conflict was entirely economic and had nothing whatsoever to do with slavery, which also had existed in the North. Indeed, some northern states had “exclusion ordinances” and anti-immigration provisions in their state constitutions that prohibited the immigration of blacks into northern states.

    If freeing slaves were important to the North and avoiding tariffs was important to the South, one can imagine some possible compromises. For example, the North could have committed to building factories in the South. As the South became industrialized, new centers of wealth would arise independently from the agricultural plantations that produced cotton exports. The labor force would adjust with the economy, and slavery would have evolved into free labor.

    Unfortunately, there were too many hot heads. And so, too, today.

    In America there is nothing on the horizon but hate. Everywhere you look in America you see nothing but hate. Putin is hated. Russia is hated. Muslims are hated. Venezuela is hated. Assad is hated. Iran is hated. Julian Assange is hated. Edward Snowden is hated. White heterosexual males are hated. Confederate monuments are hated. Truth-tellers are hated. “Conspiracy theorists” are hated. No one escapes being hated.

    Hate groups are proliferating, especially on the liberal/progressive/left. For example, RootsAction has discovered a statue of Robert E. Lee in the U.S. Capitol and urges all good people to demand its removal. Whether the level of ignorance that RootsAction personifies is real or just a fund-raising ploy, I do not know. But clearly RootsAction is relying on public ignorance in order to get the response that they want. In former times when the US had an educated population, everyone understood that there was a great effort to reconcile the North and South and that reconciliation would not come from the kind of hate-mongering that now infects RootsAction and most of the action groups and websites of the liberal/progressive/left.

    Today our country is far more divided that it was in 1860.

    Identity Politics has taught Americans to hate each other, but, nevertheless, the zionist neoconservatives assure us that we are “the indispensable, exceptional people.” We, a totally divided people, are said to have the right to rule the world and to bomb every country that doesn’t accept our will into the stone age.

    In turn the world hates America. Washington has told too many lies about other countries and used those lies to destroy them. Iraq, Libya, Yemen, Afghanistan, Somalia, and large chunks of Syria and Pakistan are in ruins. Washington intends yet more ruin with Venezuela currently in the cross hairs.

    Eleven years ago Venezuelan President Hugo Chavez resonated with many peoples when he said in his UN speech: “Yesterday at this very podium stood Satan himself [Bush], speaking as if he owned the world; you can still smell the sulphur.”

    It is difficult to avoid the conclusion that America is a font for hatred both at home and abroad.

  • Bankrupting Terror: Blocking the Saudi Aramco IPO

    Background here.

    By Kristen Breitweiser, one of the four 9/11 widows – known as the “Jersey Girls” – instrumental in forcing the government to form the 9/11 Commission to investigate the 2001 attacks. Follow Kristen Breitweiser on Twitter: .

    Who’s the most reviled person you know? David Duke? Bernie Madoff? Vlad Putin? Kim Jong Un? Well, whomever it is, just imagine how you would feel if they weren’t held accountable for their bad acts? Worse, what if they were not held accountable, but actually rewarded and enabled to continue to do more of their bad acts. Worse still, if they were not held accountable, rewarded and enabled to continue their bad acts—by your very own family and friends. How would that make you feel?

    That’s kind of what has happened to the 9/11 Families with regard to the Kingdom of Saudi Arabia during the past 16 years since the September 11th attacks. Our most reviled entity, the Kingdom of Saudi Arabia, who we want to see held accountable for their alleged financial and logistical role in the mass murder of 3,000 on September 11th seems to continually evade accountability, get rewarded for its bad behavior, and encouraged to continue its bad acts with the help of the very same people who should be holding the Saudis accountable and protecting Americans.

    Yet, maddeningly, it seems that many leaders in the United States would prefer to reward and enable the Kingdom so it can continue to carry out its bad acts that are far too often connected to lethal terrorism.

    Whether its Congress signing off on $100 billion weapons deals that give Saudis a stockpile of weapons and machinery to be used against innocent people in places like Yemen and Syria. Or, giving Saudi officials CIA Medals of Honor for their dubious counterterrorism achievements. Or, giving a seat to the Kingdom to serve on the UN Commission on the Status of Women and a second seat to serve on the UN Human Rights Council. Or continuing to let Saudi Royals off the hook for crimes they commit because of diplomatic and/or sovereign immunity. Or, the most recent example of Wall Street Executives and others bending over backwards to try and win the Saudi Aramco IPO. Why do such intelligent individuals, agencies, or entities seemingly continue to kowtow to the Kingdom? How can they overlook the Saudis track record of human rights abuses, funding of Sunni radical terror groups, horrific treatment and oppression of women, and alleged participatory role in the 9/11 attacks.

    Within the next 6 months or so, the Kingdom of Saudi Arabia will choose the venue for its Aramco IPO. Stock exchanges around the globe are jockeying, wooing, and coddling the Saudis to try and win this business. Admittedly, because of the size of Aramco, this IPO will be one of the largest in history. This explains why the exchanges in Hong Kong, London, and the U.S. are vying to win the deal. Yet, as someone whose husband worked on Wall Street until he was killed on September 11th while working at his desk on the 94th floor of Tower 2, WTC, I find the collective fervor of these stock exchanges disappointing; and those of the American exchange particularly appalling. Et tu Brute? Nothing like inviting criminals back to the scene of the crime to gloat, cash in and make a cool trillion. So much for hallowed ground.

    So while Wall Street head honchos like Jamie Dimon are likely dropping to their knees drooling for such a whale of a Saudi deal, a few blocks away the 9/11 Families (16 years out from the 9/11 attacks) are still in federal court trying to hold the Kingdom of Saudi Arabia accountable for its alleged role in the 9/11 attacks that killed our loved ones—many of whom worked on Wall Street. When you are a family member of a U.S. victim of terrorism, you must live within the short blocks of such incongruities and disloyalties. And, learn to be patient in your pursuit of justice.

    Indeed, we are now on our third U.S. President since the 9/11 attacks and not one of these Presidents (or any of the ones before them for that matter) has seen fit to hold the Kingdom accountable for their participatory role in Sunni radical terrorism, in general, or the 9/11 attacks, in particular.

    How does President after President give speech after speech continuing to take us into foreign land after foreign land to fight terrorists from al Qaeda, the Taliban, and ISIS, yet never crack down on the one country in the world that is constantly and consistently the biggest benefactor of those very same terror groups—year in and year out. Indeed, thinktank, after thinktank, after thinktank, and report, after report, after report after report and classified cable, after classified cable, reveal that the Kingdom of Saudi Arabia continues to fund and logistically support the very terror groups that our U.S. military has been fighting against for nearly two decades. Our leaders talk about their mistakes of relying on bad intelligence; believing in nation building and the false promise of spreading democracy; and/or accidentally creating power vacuums. Yet, not one of these men seems to have the principled realism to see and acknowledge the one constant connected to terrorism decade after decade: the Kingdom of Saudi Arabia and its oil dollars.

    Truly, without Saudi flowing dollars, where would terrorism be? Which brings us back to the Saudi Aramco IPO and my bewilderment as to why anyone is supporting it.

    The Saudis need the Aramco IPO because they are running extremely short on cash; they’re in a cash crunch. Indeed, several reports have indicated that the Saudis are behind on payments, and being forced to instill austerity upon their people since they can no longer afford to pay such large subsidies to their citizens. The result of this belt tightening is an increasingly disgruntled Saudi population that had grown accustomed to large government handouts. In short, the natives are restless and that’s never a good thing especially for a Monarchy full of Royals who rule because god says so.

    Some would say that in situations like this, cash goes a long way to snuff out those flames of discord and discontent. Yet, without the cash raised by its impending Saudi Aramco IPO, the Saudis wouldn’t be able to pay their way out of their current situation. Again, would that be such a bad thing? What would happen if the Kingdom of Saudi Arabia went broke and its Saudi citizens were less able to give such large amounts of money to zakat? Would it break the cycle of Saudi funding to Sunni radical terror groups? Bankrupt and no longer flush with cash, it’s fair to assume that most Saudi donations earmarked to fund and logistically support radical Sunni Islam would dry up and ultimately come to an end—undoubtedly going a long way in making the world a safer place.

    When President Trump gave his speech on Afghanistan last week, he mentioned that our foreign policy must take on a more principled realism. I don’t know how much more real and principled you can get than centering a “pillar” of our national security on the bankrupting of the Kingdom of Saudi Arabia in order to stop Sunni radical terrorism.

    Without the influx of Saudi funds, Sunni mosques and madrassahs would not likely get built and supported; textbooks that spew hate and violence would not likely get written and distributed around the world to brainwash disciples; websites, chat rooms, and social media accounts would likely quickly go dark and quiet; and training camps in places like Afghanistan would likely be abandoned, as well. Gee, that sounds like a net win. And, not one American soldier’s life would be lost in the process.

    The facts are clear. The Kingdom of Saudi Arabia funds and logistically supports terrorists that are killing us around the globe in places like London, Paris, Belgium, Finland, Spain, and the United States. Our banking executives and governmental officials should ward against financially propping up the Kingdom merely so it can survive another day to continue to fund terror and radical Sunni terrorist groups that wreak havoc upon us. Doing so is in our direct national security interests since the Saudi Aramco IPO is nothing short of a crowd-funding campaign for jihad. And none of us should invest a dime.

    Moreover, isn’t blocking the Saudi Aramco IPO merely giving the Saudis a potent dose of their own medicine particularly given the Saudis recent embargo and sanctioning of Qatar because Qatar funds and supports terrorism? As reported by Reuters, “Saudi foreign minister Adel al Jubeir said there would be no negotiations over demands by the Kingdom and other Arab states for Qatar to stop supporting terrorism. Jubeir said, ‘We made our point, we took our steps, and now it is up to the Qataris to amend their behavior and once they do things will be worked out but if they don’t they will remain isolated.’” I wish our U.S. leaders and ‘ministers’ of finance would share a similar “cut and dry” approach towards accountability and terror funding. Additionally, I’d suggest Mr. Jubeir take a good hard look in the mirror and hold his own Kingdom to the same standards he sets for Qatar. Because Adel, what’s good for the goose is good for the gander.

    To me, anyone who looks to host the Saudi Aramco IPO is akin to being an accomplice before the fact of any future terrorist attack that is carried out by Sunni radical terror groups. Just like any individual investor looking to become a shareholder of Saudi Aramco should be made aware that they’re also knowingly buying a share of the Kingdom of Saudi Arabia and are, therefore, financially propping up and morally tied to all of the Kingdom of Saudi Arabia’s Sunni radical policies and ideologies that contribute to the death and destruction of human lives. Indeed, as a Saudi Aramco shareholder you are financially supporting: the horrific oppression of women; the trafficking and slavery of human beings; the draconian doctrine of Sharia law with its canings, beheadings, eye-gougings, stonings, and torture; and most likely the continued funding of Sunni radical terror groups like ISIS, al Qaeda, and the Taliban that may someday kill someone you love.

    Why would anyone ever want to buy into a share of that?

    Do Jamie Dimon, Ken Moelis, and Michael Klein like terrorist attacks? Do they realize that hosting the Saudi Aramco IPO is akin to “signing off” and supporting terrorism? Do these three Americans condone people like my husband Ron getting slaughtered and blown to bits by radical Sunni terrorists? And groups like ISIS, al Qaeda, and the Taliban continuing to get infused with their Saudi funded life-blood so they can continue to chop off more infidel heads? Does the collective greed of these three men and their Wall Street brethren truly eclipse our entire nation’s right to be safe from terrorists? I think not.

    Why do we all have to suffer the carnage of their greed?

  • Trump's Presidential Approval Rating In Context

    Presidential job approval is a simple, yet powerful, measure of the public's view of the president's job performance at a particular time. Approval ratings for Presidents Obama and Trump shown in the Presidential Job Approval Center are based on weekly Gallup Daily tracking averages.

    From Truman to Trump…

    On day 212 in office, President Trump has a 37% approval rating.

    President Truman holds the record for lowest approval rating (for now) at 22% on day 2499 in office.

    President George 'W' Bush holds the record for the highest approval rating at 89% on day 267 in office

  • A Full-Blown Civil War Is Materializing: "Nobody Will Be Able To Retreat To A Neutral Corner"

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

    At the rate things are going, a full-blown civil war appears to be materializing. 

    Colin Kaepernick began it all with “taking a knee” in protest of the National Anthem. 

    Fast-forward one year later, and read this, released by Yahoo Sports for just how far it has gone:

    “The Colin Kaepernick story has gotten seemingly endless attention because its reach goes far beyond football.

     

    A pretty good reminder of that came Saturday afternoon in New York City, which is far removed from Kaepernick’s former NFL home of San Francisco. At a rally in Brooklyn, dozens of current and former New York police officers wore shirts that said “#WeStandWithKap” and at the end of the rally they took a knee and raised their fist, according to the New York Daily News.

     

    Kaepernick became a household name when he took a knee for the national anthem last season to bring attention to racial injustice, including police brutality. It also appears to be one reason he has not been signed by any NFL team this offseason.

     

    The police officers noted to the Daily News that they were speaking out against their belief that NFL teams aren’t signing Kaepernick as punishment for his protest.

     

    “What Colin Kaepernick did is try to bring awareness that this nation unfortunately has ignored for far too long,” said NYPD Sgt. Edwin Raymond, an organizer of the rally, according to the Daily News. “And that’s the issue of racism in America and policing in America. We decided to gather here today because of the way he’s being railroaded for speaking the obvious truth.”

    So, now the New York City Police Department weighs in on this.  They claim Kaepernick is being “railroaded,” eh?  Funny: He didn’t do it the year he went to the Super Bowl with the 49ers and a billion people were watching.  He didn’t stand for anything then, and he stands for nothing now.  That flag and that anthem represent something…and many died to keep the nation flying that flag and playing that anthem intact.  The sad irony of rights under the Constitution is that Kaepernick has the right to protest…a right that was enabled for him to exercise by his betters.  Look up the pictures of him and his buddies holding up automatic rifles, standing for nothing except themselves: perfect symbols of a decayed society and a dying empire.

    The country is committing suicide as we speak.  The push for revision and redaction in all the history books has been on for some time.  Now we’re seeing actual mobs of demonstrators surrounding these historical statues.  The push is on.  On August 19, demonstrators in Detroit gathered to protest and demand removal of a statue of Christopher Columbus.  In all the major cities, the push to remove these statues along with protests continues.

    It’s not going to stop here.  Now that Bannon is gone, a letter was sent to the President by more than a dozen conservative groups asking for him to not move toward a more moderate stance.  Indeed, over the weekend he “Tweeted” the Boston Police Department commending them on the way they handled the protests there.  The President has also adopted this “wishy-washy” stance of “we all need to heal the wounds” in the U.S., as if any of these protests had any relevance to any injustices happening today.

    Seriously, this is all out of Alinsky’s “Rules for Radicals.”  Go back and review the Glenn Beck programs of 2012-2014…when he presented some very good information on the Weather Underground (particularly Bernardine Dohrn and Bill Ayers), as well as Cloward and Piven, and all the “outstanding” work by Van Jones to topple the system.  I’m not a personal fan of Beck’s, but back then he used to have very comprehensive layouts that were easily referenced and noted that concerned these Marxists and Communists marching under the banner and guise of “social justice.”  All that stuff that Van Jones had planned back then, with funding from Acorn and George Soros…it is manifesting itself here and now.

    There is a civil war coming, as it is the domestic initiative that must be pursued to bring the United States down to the canvas…rendering her ineffective when the foreign initiative…an attack comes…to give the final count.  In both battles, nobody will be able to retreat to a neutral corner.  If the U.S. stays intact, then the NWO loses, and vice-versa.  These protestors (paid and genuine) are but a sampling of the platter to be served…a buffet right out of Pandora’s box.

  • South Korea Orders Show Of "Overwhelming Force", Conducts "Live Bombing" Drill As Kospi Tumbles

    While we await Donald Trump’s response to the second consecutive North Korean provocation in four days, both on twitter and elsewhere, South Korean President Moon Jae-in has already ordered his troops to demonstrate their capability for “strong retaliation” and put on a show of “overwhelming force”, after his office convened a National Security Council session.

    According to Yonhap, President Moon ordered his country’s military to display its capabilities that can “overwhelm” North Korea should the communist state decide to attack, the presidential office  The show of overwhelming force involved the dropping of eight Mark 84 or MK84 multipurpose bombs by four F15K fighter jets at a shooting range near the inter-Korean border in Taebaek, Moon’s chief press secretary, Yoon Young-chan, told reporters.

    “The NSC standing committee denounced North Korea for violating the U.N. Security Council resolutions by again launching ballistic missiles despite stern warnings,” Yoon told a press briefing.

    Yoon also said that in a telephone conversation that also took place shortly after the latest North Korean missile provocation, South Korean Foreign Minister Kang Kyung-wha and her U.S. counterpart Rex Tillerson agreed to push for additional sanctions by the U.N. Security Council. 

    Futhermore, Gen. Jeong Kyeong-doo, chairman of South Korea’s Joint Chiefs of Staff, and his American counterpart Gen. Joseph Dunford agreed to take related measures at the earliest possible date, which apparently include the temporary dispatch of U.S. strategic assets like long-range bombers to Korea.

    “We are considering the development of strategic assets in the US and we will consult with the United States.” US strategic weapons include B-1B strategic bombers, B-52 long-range nuclear bombers, stealth fighters, Aegis destroyers, and nuclear propulsion submarines, Yonhap reported.

    Chung Eui-yong, Moon’s top security adviser, also held a telephone conversation with the White House’s National Security Adviser H.R. McMaster to discuss the allies’ joint measures against the North’s latest missile provocation. “McMaster said President Donald Trump fully supported President Moon’s North Korea policy and the South Korean government’s measures against North Korean provocations,” Yoon said.

    As Yonhap concludes, “it’s quite unusual for the secretive nation to fire a ballistic missile from its capital, another sign that it’s diversifying launch areas to dodge external surveillance and a possible pre-emptive strike.”

    Meanwhile, unlike previous launch instances, so far the S.Korean Kospi stock index has failed to rebound (yet), and was down 1.3% at last check…

    … while the Kospi VIX, along with most Asian stock vol indicators, spiked in early trading.

    Meanwhile, the Korean Won, which has become quite immune to Apocalyptic outcomes, sat near sessions lows, if well above where it was just ten days ago.

    Discussing the resilience of the South Korean currency, Koon How Heng, head of markets strategy at United Overseas Bank Group said the won is “failing to properly price in risks surrounding North Korea and trade talks with the U.S.” He added that “risk remains that KRW will weaken and lift USD/KRW back towards the top end of the trading range” although it remains to be seen just what event – clearly a North Korean violation of Japanese airspace is not quiet “it” – will be sufficient to dislodge the currency from its perch.

    Finally, in a curious tangent, while certainly not in Kim’s field of sight, Australian stocks just went negative for the year.

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Today’s News 28th August 2017

  • Macron Approval Rating Crashes Twice As Fast As Trump's

    It appears that Trump is no longer the president with the fastest plunge in his approval rating: that honor has now fallen to France’s Emanuel Macron, who since his dramatic victory in the May 7 presidential election, has seen his popularity plummet, and according to a a new poll conducted by Ifop for Le Journal du Dimanche, most French voters are now dissatisfied with Emmanuel Macron’s performance, a dramatic decline for the president who basked in a landslide election victory less than four months ago.

    The poll showed Macron’s “dissatisfaction rating” soaring to 57%, from 43% in July. At the same time, those satisfied with Macron tumbled from 54% in July (and 62% at election) to just 40% in August, a stunning 22% drop over three months…  which is twice as fast as Donald Trump’s fall from grace. According to Gallup, on Inauguration Day, 45% of Americans said they approved of Trump and since then, the number has declined by 11% to 34%, which again is only half as bad as Macron popularity plunge. The Ifop poll also showed the cumulative drop in Macron’s popularity ratings since May was far bigger than that of previous Socialist president Francois Hollande over the same period, who is best known for achieving the lowest approval record of any recent French president on record. As such, one wonders how Macron’s approval rating in a few short years can even be positive.

    Quoted by Reuters, French government spokesman Christophe Castaner said the ruling party was going through a “tricky time”, but added that displeasing some people was a price worth paying if the government wanted to push through reforms. The only problem is the government will most likely not be able to push through reforms, even as Macron’s approval continues its sharp descent. Cartaner also told BFM TV that “yes, we are encountering difficulties, but you cannot just spend your time only looking at polls when you’re in government. We are there to transform the country. Our country needs us to take risks, and we are taking risks.” Spoken like a true megalomaniac.

    As for Macron –  who is currently midway through a schedule of official visits to various European capitals and who most recently got into a violent feud with Poland when he criticized the Warsaw government for its “non-European ideals” to which Polish PM Beata Syzdlo slammed “arrogant” Macron saying “you won’t rule Europe” – has suffered a number of setbacks since being elected, including tough debates in parliament over labor reform, a standoff with the military and cuts to housing assistance. Then, just last week, Macron became the target of social media scorn and humor, while political opponents criticized the president when it emerged he spent €26,000 ($31,000) on makeup during his first 100 days in office and his office also backed down on plans to give his wife a formal, paid role after a public backlash.

    In any case, the latest polling is terrible news for the young new president who was expected to inspire his country with hope and confidence yet appears to be doing just the opposite: Bernard Sananes, head of French polling company Elabe, said the latest survey could encourage Macron’s political opponents, after his party won a commanding majority in parliament.

    “It could mean, for the government, that the opposition mobilizes itself again,” Sananes told BFM TV.

    It wasn’t just Macron: the poll also showed a steep drop in approval for Prime Minister Edouard Philippe, with 47% expressing satisfaction with him – down 9% from last month.

    As Reuters adds, Macron – France’s youngest leader since Napoleon – faces a big test next month when the far-left CGT trade union leads a rally to protest against plans to deregulate the jobs market. “Now is the key time, with the labor executive orders to be presented,” said Francois Savary, chief investment officer at Geneva-based investment firm Prime Partners, who has an “underweight” position on French equities.

  • Embracing A Multipolar World Order: How Rodrigo Duterte Is Revolutionizing The Philippines

    Authored by Federico Pieraccini via The Stratgaic Culture Foundation,

    In a new global environment, centered on a multipolar world order, the Philippines offers a unique perspective for understanding the changes occurring in international relations.

    With the victory of Rodrigo Duterte in May 2016, many anticipated a major change in Manila's relations with such countries as the United States and China. The Philippines has always enjoyed a privileged role in the containment strategy directed by Washington against the People's Republic of China. Since the very beginning of Duterte’s presidency, and especially during Obama's final months in office, Duterte displayed his disappointment with the United States’ use of the Philippines as a bulwark against Chinese expansion in the region. Such a role is something that a pragmatic leader like Duterte, with the interests of his nation at heart, would never accept to adopt.

    Duterte’s first diplomatic visits and statements confirmed this direction, with blunt words confirming his intentions to widen cooperation and alliances with the major countries of China and Russia, as demonstrated during Duterte's visit to Beijing and Moscow.

    In the months that followed, with Trump as the new occupant of the White House, Duterte greatly softened his rhetoric and moves against the United States, sensing some sort of natural affinity with Trump. Although Duterte has repeatedly shown an aversion to the imperialist policies of the American colonial masters, he seems to have a high regard for strongmen like Putin, Xi and, of course, Donald Trump, among whose company he includes himself.

    Trump's victory in the 2016 election has created a common ground with Duterte: both oppose their internal establishment and have a tough way of getting along with their political enemies. Besides this, Trump is much less interested in pursuing Obama's 'Asian Pivot', a policy based on the containment of China through economic and military pressure from US allies in the region like the Philippines. Trumps looks more interested in using existing trade between the US and China as a means of harassing Beijing.

    One of the main events that appears to have shaken the Duterte presidency, in addition to the internal political struggles and pressure from opposing political parties, is the terrorist attacks and clashes with Daesh in the city of Marawi on the island of Mindanao. What was meant to be a rapid operation to liberate the city from Daesh is turning out to be an urban counter-guerrilla operation with an unknown end date.

    With internal pressure building up against Duterte, both from within his party and from the opposition, stemming from the difficult relationship with Washington, the North Korean crisis seems like the perfect opportunity to ease relations with Washington and seize the opportunity to silence his domestic critics.

    Manila, being marginally involved in this crisis, has allowed Duterte, showing brilliant intuition, to seize this opportunity to criticize Kim Jong-un (without risking a worsening of the overall situation with the DPRK), openly supporting Donald Trump's policy as well as Beijing's diplomatic efforts. It is a win-win situation for Duterte, at once placating internal critics, following Beijing's lead, and giving credit to Trump.

    Duterte seems to have realized that rather than a firm stance against Washington, a disinterested dialogue may be the best option for alleviating internal criticism by US-influenced lobbies within the Philippine establishment.

    The good news for Trump's strategic planners ends here.

    In addition to purchases of arms from Russia, still unclear in terms of quantity but certainly imminent, Manila and Beijing have begun a slow but inexorable rapprochement. In recent months, the discussions surrounding the Scarborough Shoal have progressed from rhetoric involving threats to cooperation and dialogue. The situation has shifted from a possible war to a major agreement summed up by the Foreign Minister of Manila, Delfin Lorenzana, thusly: «The Chinese will not occupy new features in the South China Sea nor will they build structures in Scarborough Shoal».

    This statement, agreed on with Beijing, is the basis of a new conception of the multipolar world order that heavily relies on a respect for international relations. Fair negotiations grounded on common interests shared by all parties involved are what unite different countries. It represents a striking difference to the old unipolar world order where military force and power is imposed by Washington on practically every other state. Manila has every interest in developing a new and fruitful dialogue with Beijing, hoping to solve all controversies related to contested areas. The impetus for such talks seems to be economic.

    The areas disputed by China and the Philippines in the South China Sea, besides being important for geostrategic reasons, contain considerable reserves of natural resources. What appears to be on the cards is an agreement between Manila and the Philippines to jointly explore territories that are undisputed by the Philippine oil and gas firm PXP Energy Corp and the China National Offshore Oil Corp. Revenues are to be divided to the effect of «60% to Manila and 40% to Beijing in any areas under the control of the Philippines authorities.”

    This clarification from Alan Peter Cayetano, Secretary of Foreign Affairs, seems to have every intention of preventing internal criticism coming from politicians and entrepreneurs opposed to any collaboration or de-escalation with Beijing. Critics are using harsh rhetoric, as seen with minority lawmakers Gary Alejano and Edcel Lagman, who are opposed to the energy plan, saying it would be illegal: «This is contrary to our Constitution because these areas should be exclusively for the Filipinos,» Lagman said.

    Despite the misgivings of Duterte's opponents, joint explorations are a starting point for re-establishing relations between the two countries, and seem to be a sensible choice with potential economic benefits for both countries. As explained by an administration official who prefers to remain anonymous: «What we are looking at is a deal that will first cover exploration activities in uncontested areas, areas closer to the Philippines, including Recto Bank».

    Manila does not possess the technological capacity to carry out such explorations on its own, and for Beijing this strengthens its position in the South China Sea vis-a-vis other disputing countries in the region. Joint explorations highlight the benefits that arise from mutually beneficial economic cooperation with China. Overcoming tensions and conflict while making money looks like an offer too good for any country in the region to refuse. It is easy to deduce that this an asymmetrical response from Beijing in response to the American attempt to increase tensions in the region, such as with the recent appearance of Daesh on the Philippine peninsula, or with the DPRK issue.

    The scope of projects between Manila and Beijing seem to indicate a clear path ahead. Using the joint exploration of important energy resources, and creating new investment projects, it looks like a clever way to create economic and political conditions for tackling more pressing issues like disputed territorial areas. Normally these diplomatic negotiations are unsuccessful and often inconclusive, since both factions are unable to make concessions to their opponents, having nothing to gain and everything to lose.

    Manila and Beijing are using a common approach to reach an agreement over disputed territories, with economic plans to jointly exploit the many resources in the area being an incentive to pursue negotiations. With the alternative to cooperation, prosperity and dialogue being hostility, with the possibility of war, there is no other choice other than to cooperate to smooth out their differences.

    In observing mandarin diplomacy, one will see that this is Beijing's primary strategic approach to all sorts of matters. The Belt and Road Initiative is the ultimate expression of this approach, complemented by a series of infrastructure investments in countries involved in the project that will significantly improve living conditions of their citizens.

    Besides joint explorations, Beijing's infrastructure projects in the Philippines also seem to be heading in this direction. Without being naive, Manila also understands that the more China becomes important to the Philippine economy, the more leverage Beijing has over its strategic decisions. These projects all look good for their economic revenues, but China also has a broader objective, namely safeguarding its interests in what it defines as its own “backyard», referring to the South China Sea.

    Duterte seems to have understood, probably better than any other leader of the multipolar international order, the opportunity to counterbalance American influence in the region through Chinese investments. In addition, asking Moscow for some help in tackling the Mindanao terror crisis could be crucial in the future. All these factors seem to have greatly strengthened Duterte’s position and that of Manila on the Asian chessboard, granting a degree of independence that has not been enjoyed over the past decade in the Philippines.

  • YouTube "Economically Censors" Ron Paul, Labels Videos "Not Suitable" For All Advertisers

    Former US Congressman Ron Paul has joined a growing list of independent political journalists and commentators who’re being economically punished by YouTube despite producing videos that routinely receive hundreds of thousands of views.

    In a tweet published Saturday, Wikileaks founder Julian Assange tweeted a screenshot of Paul’s “Liberty Report” page showing that his videos had been labeled “not suitable” for all advertisers by YouTube's content arbiters.

    //platform.twitter.com/widgets.js

    Assange claims that Paul was being punished for speaking out about President Donald Trump’s decision to increase the number of US troops in Afghanistan, after Paul published a video on the subject earlier this week.

    The notion that YouTube would want to economically punish a former US Congressman for sharing his views on US foreign policy – a topic that he is unequivocally qualified to speak about – is absurd. Furthermore, the “review requested” marking on one of Paul's videos reveals that they were initially flagged by users before YouTube's moderators confirmed that the videos were unsuitable for a broad audience.

    Other political commentators who’ve been censored by YouTube include Paul Joseph Watson and Tim Black – both ostensibly for sharing political views that differ from the mainstream neo-liberal ideology favored by the Silicon Valley elite.

    Last week, Google – another Alphabet Inc. company – briefly banned Salil Mehta, an adjunct professor at Columbia and Georgetown who teaches probability and data science, from using its service, freezing his accounts without providing an explanation. He was later allowed to return to the service.

    Conservative journalist Lauren Southern spoke out about YouTube’s drive to stifle politically divergent journalists and commentators during an interview with the Daily Caller.

    “I think it would be insane to suggest there’s not an active effort to censor conservative and independent views,” said Southern.

     

    “Considering most of Silicon Valley participate in the censorship of alleged ‘hate speech,’ diversity hiring and inclusivity committees. Their entire model is based around a far left outline. There’s no merit hiring, there’s no support of free speech and there certainly is not an equal representation of political views at these companies.”

    Of course, Google isn’t the only Silicon Valley company that’s enamored with censorship. Facebook has promised to eradicate “fake news,” which, by its definition, includes political content that falls outside of the mainstream.

    Still, economically punishing a former US Congressman and medical doctor is a new low in Silicon Valley's campaign to stamp out dissent.

  • Internal CIA Memos Expose Media As Agency's "Principal Villains", Urges "Intervention In Journalism Schools"

    Authored by Emma Best via Muckrock.com,

    “Absolute power corrupts absolutely, and the power of the media to publish in this country is nearly absolute.”

    A series of 1984 memos from the CIA Inspector General’s (IG) office reveals some alarming views on the press and how to deal with them. Among other things, the memo shows that 33 years before the Agency declared WikiLeaks a hostile non-state intelligence service, they were viewing the general press in the same terms.

    Several weeks prior, CIA Director Casey had asked the IG to weigh in on officer Eloise Page’s paper on unauthorized disclosure. The IG passed the task onto someone on his staff, who produced a four page SECRET memo for IG James Taylor, who passed it onto Director Casey.

    The IG specifically endorsed the proposal for a program where the Agency would intervene with journalism schools, which is discussed further below.

    The SECRET memo began by endorsing the proposals that Page had laid out in her paper. Specifically praised among her proposed initiative was new legislation, a special FBI unit, and a special prosecutor. While it was obviously hoped that this would help enforce the law, the member of the IG staff also hoped that they would create a chilling effect. The sole criticism for Page’s paper was that it lacked a strategy for dealing with the media, who were the “principal villains” in all of this.

    To the Inspector General’s office, the reason that the press were the “principal villains” was simple: “absolute power corrupts absolutely” and “the power of the media to publish in this country is nearly absolute.” As a result of the media’s “absolute power”, argued the Agency that had been involved in mind control attempts, illegal surveillance, tampering in foreign elections and dozens of assassinations, assassination attempts and coups, they had been corrupted absolutely. The member of the IG’s staff then suggested that they compare the media to the “opposition,” a reference to hostile intelligence services. This could be backed up by citing “precise parallels in methods and results, if not in motivations, between the media’s attempts to penetrate us and the opposition’s attempts to do the same.”

    The IG’s office argued that the Agency’s response to the media had been largely passive and inadequate. Proposing that it was “time for an offense as well as a defense”, they offered a list of potential Do’s and Don’ts for the Agency.

    First and foremost, they argued that the Agency shouldn’t “frontally attack” concepts such as the First Amendment and freedom of the press. Nor should any program to curb media excesses be announced. While they had praised Page’s suggestion of new legislation, they also argued that the Agency shouldn’t expect anything to materialize. Nor should they expect help from Congress on covert action – it was simply “too easy to argue there’s a public interest in debating actions that could lead to war.” Instead, the Agency should remember that journalists don’t operate in a vacuum and their support/publishing structure can be prevailed upon as a method of tempering a journalist’s activities – especially since the press had “their own reasons for wanting to improve [their] image.”

    The list of Do’s was significantly longer, beginning with several self-explanatory suggestions and a call for releasing “a sanitized list of foolish media disclosure that have cost the country or individuals substantially.” The second half of that suggestion remains redacted, marked as exempt from disclosure lest it reveal some of the Agency’s sources or methods.

    The list of Do’s also included using the Agency’s official contacts “in leadership posts” for academia and the media. There were “undoubtedly” similar unofficial contacts that could also be prevailed upon.

    A later suggestion similarly pointed out that “the media have owners, Boards of Directors, managing editors et al” and that the Agency “had some success for a while in staving off” something, the details of which remain redacting allegedly to protect the Agency’s sources and methods.

    The penultimate suggestion put forward by the IG’s office was that the Agency should figure out just what media ethics reviews and processes existed, and “try to get such people to address the issues that concern us.” That finding out and using proper channels needed to be suggested as a new strategy to pursue is mildly alarming.

    The final suggestion, which was specifically praised by the IG when presenting the memo to the CIA Director, was using Agency contacts with college and university presidents at schools of journalism to change their curriculums. The hope was that this might challenge or put an end “to the practice of publishing indiscriminately whatever an investigative reporter can come up with.” The IG seemed taken with the idea that “given some curriculum changes, the next generation of reporters might show some elevation of ethics.”

    The CIA Director passed the memo to Clair George, the Agency official responsible for liaising with Congress who would later be convicted of lying to Congress.

    You read the exchange of memos here.

    Is it any wonder that the CIA is now terrified of the non-mainstream media, that is outside of their control?

  • "We're Back In The '60s Again" – Bomb-Shelter Sales Are Booming In The US And Japan

    US-based bomb-shelter manufacturers should maybe think about buying Kim Jong Un a fruit basket.

    According to McClatchy, sales have in both the US and Japan have risen dramatically this year as President Donald Trump and Kim have exchanged threats of nuclear annihilation. US and Japanese defense officials now believe the North is in possession of a nuclear warhead small enough to fit onto one of its ICBMS. The isolated country launched three short-range missiles into the East Sea Friday night – its first missile test in nearly a month – after US officials had praised Kim’s restraint earlier in the week.

    Ron Hubbard, president of Atlas Survival Shelters, a firm based in Montebello, California, said he expects to sell 1,000 shelters this year at a price of $25,000 apiece, according to McClatchy.

    "Sales and inquiries have spiked, according to several of the U.S. companies that make money from doomsday fears.

     

    “The increase in demand is everywhere. We are getting hundreds of calls,” said Ron Hubbard, president of Atlas Survival Shelters, a firm based in Montebello, California. Inquiries have slowed down as tensions have eased over the last week, but Hubbard said he still expects to have a banner year, selling 1,000 shelters at an average price of $25,000 each.”

    Sales in Japan have increased to the point where one manufacturer is opening a sales office in Osaka.  

    “Hubbard reports there is intensified demand in Japan, where he has opened a sales office in Osaka. He’s also opening a new 400,000-square-foot plant in Dallas, largely to serve the Japanese market.

     

    “We are back in the 1960s again,” said Hubbard, referring to the Cold War demand for bomb shelters. “We’ve got a crazy man on one side and Donald Trump on the other.”

    Gary Lynch, general manager of Rising S Shelters in Murchison, Texas, has also seen a rise in demand for his products both in Japan and the US.

    “'It is all due to the rhetoric on what is going on in North Korea,’ said Lynch, who said he has sold 67 bomb shelters internationally this year, mostly to Japan, compared to just nine for all of 2016.”

    Lynch’s boss, Rising S owner Clyde Scott, told McClatchy that after Obama became president in early 2009, his company was inundated with orders from conservatives who were afraid Obama would try and take their guns. Now, Rising S is selling shelters to Democrat who are afraid Trump will start a war.

    “In the United States, bomb shelter customers run the gamut. Some are homeowners recently alarmed about the threat of a nuclear strike. They also include survivalists and “preppers” — people preparing for man-made or natural disasters. Rising S is owned by a Texas prepper named Clyde Scott, who named his company after Jesus Christ, the rising son.

     

    After Barack Obama was elected, Lynch said Rising S was contacted by customers worried about the government coming after their guns. After Trump was elected, a different clientele — Democrats — started calling. 'People are worried that Trump would start a war,' he said.”

    Falling prices could be another reason for the bump in sales…

    “Atlas markets 15 types of shelters, Hubbard said, but focuses on a corrugated steel pipe model, which can be decked out with luxuries or kept as a simple “man cave.” He said he’s brought his average price down from $100,000 to about $25,000 in the past six years.

     

    “I think of myself as a modern-day Henry Ford, coming out with a shelter that everyone can afford,” Hubbard said.”

    Instead of selling individual shelters, one California-based company built a doomsday bunker in Indiana and sold shares for $35,000 a pop. They’ve already sold out.

    "Vivos, another California-based company, offers a completely different shelter experience. It sells shares in underground bunker complexes, a sort of doomsday condominium. Vivos — which means “to live” in Latin — says that its 80-person Indiana complex is completely sold out, with shares going for $35,000 per adult.

    Even Kim and Kanye are buying…

    “In their sales pitches, bunker companies also promise customers complete confidentiality. Rising S continues to fend off tabloid rumors that it's building a bunker for Kanye West and Kim Kardashian.”

    …but they're trying to keep it quiet because people who own bunkers generally don’t want their neighbors to know they have one.

    “Owners of shelters generally insist they don’t want their neighbors to know they have one, Hubbard said. “They would all be freaking out and banging on your door,” he said. “It is kind of like when a ship sinks — everyone swims to the floating life raft."

    Demand for bunkers is rising even in South Korea, where residents have long since written off Kim Jong Un’s threats as empty rhetoric.

    “There’s even increased interest in South Korea, he says.

     

    “South Koreans generally don’t buy shelters because they are numb to the rhetoric coming out of North Korea,” he said. “But apparently Kim Jong Un has struck a chord.”

    Though Trump promised during the campaign to adhere to an “America first” policy of nonintervention, he has repeatedly demonstrated a knack for military confrontation since taking office, having launched a missile strike on a Syrian government airfield and, just this past week, announcing that he would increase the number of troops in Afghanistan – a decision that reportedly inspired former staffer Sebastian Gorka to resign in protest.

    In the absence of Bannon, as long as Trump continues to surround himself with generals like Chief of Staff John Kelly, the threat of thermonuclear conflict will linger.
     

  • Volatility Makes A Comeback

    Authored by James Rickards via The Daily Reckoning,

    Volatility has languished near all-time lows for months on end. That’s about to change.

    For almost a year, one of the most profitable trading strategies has been to sell volatility. Since the election of Donald Trump stocks have been a one-way bet. They almost always go up, and have hit record highs day after day. The strategy of selling volatility has been so profitable that promoters tout it to investors as a source of “steady, low-risk income.”

    Nothing could be further from the truth.

    Yes, sellers of volatility have made steady profits the past year. But the strategy is extremely risky and you could lose all of your profits in a single bad day.

    Think of this strategy as betting your life’s savings on red at a roulette table. If the wheel comes up red, you double your money. But if you keep playing eventually the wheel will come up black and you’ll lose everything.

    That’s what it’s like to sell volatility. It feels good for a while, but eventually a black swan appears like the black number on the roulette wheel, and the sellers get wiped out.

    I focus on the shocks and unexpected events that others don’t see.

    Right now looks like one of those highly favorable windows when the purchase of volatility is the right move. You could collect huge winnings as the short sellers scramble to cover their bets before they are wiped out completely.

    Jim at the NYSE

    Your correspondent (left) on the floor of the New York Stock Exchange with television anchor Lelde Smits, and Stephen “Sarge” Guilfoyle during a recent visit. Sarge is the director of NYSE floor operations and one of the savviest traders on the floor. He told me, “Jim, there’s no liquidity here; it left a long time ago. When markets turn, they won’t get any support from the floor.”

    The chart below shows a 20-year history of volatility spikes. You can observe long periods of relatively low volatility such as 2004 to 2007, and 2013 to mid-2015, but these are inevitably followed by volatility super-spikes.

    During these super-spikes the sellers of volatility are crushed, sometimes to the point of bankruptcy because they can’t cover their bets.

    The period from mid-2015 to late 2016 saw some brief volatility spikes associated with the Chinese devaluation (August and December 2015), Brexit (June 23, 2016) and the election of Donald Trump (Nov. 8, 2016). But, none of these spikes reached the super-spike levels of 2008 – 2012.

    In short, we have been on a volatility holiday. Volatility is historically low and has remained so for an unusually long period of time. The sellers of volatility have been collecting “steady income,” yet this is really just a winning streak at the volatility casino.

    The wheel of fortune is about to turn and luck is about to run out for the sellers. It will soon be time for the buyers of volatility to collect their winnings, big time.

    The trap of complacency

    Here are the key volatility drivers we have considered:

    Many analysts assume that the North Korean situation is less critical today because the rhetoric has recently toned down, and the North Korean dictator, Kim Jong Un, said that he would delay his plan to fire missiles at the U.S. Territory of Guam.

    But, that’s false comfort. Kim’s statement of restraint on Guam was conditional on “good behavior” by the U.S. That was a reference to a previously planned joint military exercise of U.S. and South Korean forces running from Aug. 21 – 31, 2017. Kim’s idea of good behavior was if the U.S. called off the exercise.

    That wasn’t happening.

    The military exercise started as planned late Sunday. Now all bets are off. Kim could fire a missile at Guam, which the U.S. has already said it will shoot down.

    Kim could also test a submarine-launched ballistic missile (SLBM) that could evade U.S. anti-missile defenses or be fired at close range at the U.S. west coast. Kim might test a new nuclear weapon; perhaps a miniaturized warhead that would be the right size to place in the warhead of his ICBM that can strike Los Angeles.

    One or more of these provocations seems highly likely. The U.S. response will be firm and potentially aggressive. This would put the North Korean crisis back on the front burner, and send volatility soaring.

    Another ticking time bomb for a volatility spike is Washington, DC dysfunction, and the potential double train wreck coming on Sept. 29. That’s the day the U.S. Treasury is estimated to run out of cash. It’s also the last day of the U.S. fiscal year; (technically the last day is Sept. 30, but that’s a Saturday this year so Sept. 29 is the last business day).

    Congress has to pass two major pieces of legislation. One is a debt ceiling increase so the Treasury does not run out of money. The other is a continuing resolution so the government does not shut down.

    Both bills could be stymied by conservatives who want to tie the legislation to issues such as funding for Trump’s wall, sanctuary cities, funding for planned parenthood, funding to bailout Obamacare and other hot button issues.

    If the conservatives don’t get what they want, they won’t vote for the legislation. If conservatives do get what they want, moderates will bolt and not support the bills. Democrats are watching Republican infighting with glee and see no reason to help with their votes. The White House has already said that a “good” government shutdown may be desirable to help crystallize the policy debate.

    If these two legislative fixes are not done by Sept. 29, we’re facing both a government shutdown, and the potential for a default on the U.S. debt. Time is short and my estimate is that one or both of these pieces of legislation will not be completed in time. This will certainly trigger a volatility spike and produce huge profits for investors who make the right moves now.

    Other sources of volatility include a planned “Day of Rage” on Nov. 4 when alt-left and antifa activists plan major demonstrations in U.S. cities from coast-to-coast. Antifa are neo-fascists posing as antifascists; hence the name “antifa.” Based on past antifa actions in UC Berkeley and Middlebury College violence cannot be ruled out. This could be unsettling to markets and be another source of volatility.

    Then there are the wild cards including a natural disaster such as a hurricane, which can threaten the U.S. eastern seaboard or Gulf coast this time of year. In fact, a potential Category 3 hurricane is bearing down on Texas’ Gulf coast right now. It could dump up to 30 inches of rain and cause great destruction in the area.

    Hurricane Katrina struck at the very end of August in 2005 and Superstorm Sandy hit the Jersey Shore in October 2012. Both did enormous damage and unsettled markets for a time.

    Other wild cards include domestic terror and cyber attacks.

    Finally, we are entering an historically volatile time of year. Many of the greatest stock market crashes of all time have occurred in September or October including the Black Thursday (Oct. 24, 1929) and Black Tuesday (Oct. 29, 1929) crashes that started the Great Depression, and the Black Monday (Oct. 19, 1987) crash, in which the stock market fell 22.61% in a single day. From today’s levels, a 22.61% drop would mean a loss of 4,900 Dow points in a single day.

    Don’t rule it out.

    None of these scenarios are far-fetched or even unlikely. The war with North Korea is coming. Washington, DC dysfunction is a fact of life and we’ve had several government shutdowns in recent years. Social unrest is spreading and in the headlines every day. Hurricanes and terror attacks happen with some frequency.

    It has been nine years since the last financial panic so a new one tomorrow should come as no surprise.

    In short, the catalysts for a volatility spike are all in place. We could even get a record super-spike in volatility if several of these catalysts converge.

    Investors who prepare now for this coming wave of market shocks stand to realize huge gains when volatility roars back to life after sleepwalking for months.

  • Vietnam Plans To Legalize Bitcoin By 2018

    Vietnam is on the cusp of joining a growing list of countries that have explicitly legalized bitcoin and other cryptocurrencies, according to local media outlets cited by CoinTelegraph. Prime Minister Nguyen Xuan Phuc has authorized the formulation of a plan that could result in the legalization of digital currencies by next year, reportedly ordered the country’s central bank, ministry of finance and the ministry of public safety to study and draft the legal framework.

    If successful, Vietnam would join Japan and a handful of other countries that have explicitly legalized bitcoin and digital currency transactions. The US has taken steps toward regulating digital currencies, but those decisions have mostly been made by regulators, as well as the State of Delaware. In a vague but consequential ruling issued last month, the SEC decreed that digital currencies are securities that should be registered with the commission. Back in 2015, the CFTC ruled that bitcoin should be classified as a commodity, and earlier this summer it approved the first SEF for bitcoin-related derivatives.

    Nguyen Xuan Phuc

    Like Russia and China, Vietnam was initially skeptical of digital currencies. But like its larger peers, it has slowly warmed to them. Russian authorities announced in June that they were exploring how best to regulate digital currencies, and, earlier this year, Chinese authorities adopted new regulations to ensure local digital currency exchanges enforce its financial rules.

    According to CoinTelegraph, the assessment process must be completed by August 2018, but most of the paperwork needed to implement the new regulations should be finished by year’s end.

    Part of Vietnam’s framework will include rules for taxing digital-currency users.

    “Simultaneously, Vietnamese officials are mandated to work on a taxation system for digital currencies. The system, which will determine how virtual currency users in the country will be taxed, is due for implementation in June 2019.

    Moreover, proposals on how to prevent and handle violations concerning the use of cryptocurrencies should be submitted for approval by September of the same year.”

    In other blockchain news, CoinTelegraph is also reporting that Papua New Guinea’s central bank has drafted a plan for blockchain integration, joining central banks in the UK, Canada, the PBOC and a host of other countries in exploring potential applications for blockchain technology.

    The plan was presented by PNG central bank governor Loi Bakani during a blockchain conference hosted by the central bank.

    Bakani said blockchain technology could help introduce more of Papua New Guinea’s people to the banking system.

    "It is the new innovations that can change people's lives – almost 85 percent of our people live outside the banking system."

    PNG is hoping that the focus on digital technology will attract more foreign investment, bringing more economic opportunity to the impoverished country, according to CoinTelegraph.

  • Tillerson Out? "Frustrated" Trump "Fed Up" With Secretary Of State: Axios

    After North Korea launched three more short-range ballistic missiles into the East Sea early on Saturday morning, local time, political observers were eagerly looking forward to Trump’s response, especially since the president had managed to get boxed in by Kim Jong Un: on one hand, do nothing and be mocked and ridiculed not only by the North Korean press, but by the rest of the developed world, whose view of Trump’s diplomatic skills could hardly be any worse; or on the other hand, launch a military campaign, either surgical or broad, and risk a retaliation against South Korea and millions of US allies dying.

    In the end the US appears to have chosen the former and on Sunday, Secretary of State Rex Tillerson said the firing of three ballistic missiles by North Korea this week was a provocative act but that the United States will continue to seek a peaceful resolution. The de-escalating tone took place just days after Tillerson credited the North with showing some restraint by not launching a missile since the ICBM test in July, and he had expressed hope that the easing of tension could lead to dialogue. That was not meant to be, although in it appears that what happened next is North Korea called the US bluff, and the US folded.

    “We do view it as a provocative act against the United States and our allies,” Tillerson said in an interview on Fox News Sunday. “We’re going to continue our peaceful pressure campaign as I have described it, working with allies, working with China as well to see if we can bring the regime in Pyongyang to the negotiating table.”

    As the NYT also reported, North Korea used multiple-rocket launchers off its east coast on Saturday to fire three short-range missiles that could strike United States military bases deep in South Korea, officials in Seoul said. The launches were the North’s first rocket tests since two intercontinental ballistic missile, or ICBM, were fired last month.

    By resuming the tests, North Korea defied repeated urgings from the United States and South Korea to stop weapons trials and other provocations to pave the way for dialogue. The United States Pacific Command said that one of the three ballistic missiles had blown up immediately after blastoff, but that two others had traveled about 155 miles before splashing down. That would be far enough to reach major South Korean and American military bases, including those near the city of Pyeongtaek, about 60 miles south of Seoul. The range would also be sufficient to reach Seongju, a South Korean town where the United States has begun installing an advanced missile-defense system known as Thaad.

    Kim Dong-yub, a defense analyst at the Institute for Far Eastern Studies at Kyungnam University in Seoul, said the tests on Saturday appeared to be aimed at expanding the strike range.

     

    Nevertheless, the nature of the tests prompted some relief in the region.

     

    The missiles flew to the northeast, not toward Guam, home to major United States Air Force and Navy bases. North Korea threatened to launch ballistic missiles in a “ring of fire” around Guam after President Trump threatened to hit the North with “fire and fury” if it persisted with its development of ICBMs.

    Surprisingly, South Korea did not issue its usual condemnatory statement against the tests. In Tokyo, the chief cabinet secretary, Yoshihide Suga, said the missiles did not fall in Japanese waters or pose a threat to his nation’s safety. White House officials said that Mr. Trump had been briefed on the tests but did not immediately have any further comment.

    And while North Korea was certainly on Tillerson’s agenda, what the media was focused on was Tillerson’s reported distancing from Trump’s remarks after the deadly Virginia protests, saying the president “speaks for himself.” Tillerson’s comment on “Fox News Sunday” follows Gary Cohn, the president’s chief economic adviser and the director of the National Economic Council, saying in a Financial Times interview published last week that the administration “can and must do better” in condemning hate groups.

    In the exchange below, Chris Wallace asked Tillerson about Trump’s response to the racist carnage in Charlottesville. Tillerson replied: “I don’t believe anyone doubts the American people’s values or the commitment of the American government, or the government’s agencies to advancing those values and defending those values.”

    Wallace asked the obvious follow-up question: “And the president’s values?”

    “The president speaks for himself,” Tillerson said, leaving Wallace with a surprised look on his face.

    //platform.twitter.com/widgets.js

    So, in response moments ago Axios reported that Tillerson appears to be the next top administration in Trump’s proverbial board room, who may soon here the trademarked Trump phrase: “You’re Fired!” According to Axios, “there’s a ticking problem with Rex Tillerson, and it’s growing louder by the day, citing officials inside and close to the White House.”

    President Trump has been growing increasingly frustrated with his Secretary of State. One time recently, after Trump had returned from a meeting on Afghanistan, a source recalled Trump saying, “Rex just doesn’t get it, he’s totally establishment in his thinking.”

    As Axios adds, “Trump is getting more and more fed up with Tillerson, who has still yet to staff his agency.”

    So is Tillerson the next top administration official to get kicked out by Trump? Unfortunately, the firings at the White House have been so fast and furious in recent weeks, the online political prediction marketplace PredictIt.com hasn’t had the time to put together a contract tracking the odds of Tillerson’s imminent survival, or lack thereof.

  • Uber Selects Expedia Chief Dara Khosrowshahi As Its Next CEO

    Just nine hours after Jeff Immelt tweeted that he was no longer in the race to be Uber’s next CEO, moments ago Uber’s board selected Expedia CEO Dara Khosrowshahi, 48, various news outlets report. According to Recode, the board selected the “third candidate”, one who was not only an unknown until now, but one who as the photo below shows, is also not a woman despite his beguiling first name and the board’s rumored prerogative to pick a female next leader.

    Dara Khosrowshahi, current CEO of Expedia

    In a statement, a spokesperson said: “The Board has voted and will announce the decision to the employees first.”  If he accepts, he would be replacing founder Travis Kalanick and interim CEO Ariana Huffington.

    The decision appears to have stumped everyone, including Recode’s Kara Swisher who writes that “what that means is anyone’s guess, and sources close to one of the remaining possible CEO picks — Hewlett Packard Enterprise CEO Meg Whitman — said she has not been informed of any choice nor had the board agreed to some the the things she was asking for to take the job. Whitman was asking for a number of things, including less involvement of ousted CEO Travis Kalanick.”

    As the NYT adds, Jeff Immelt, a finalst until this morning, withdrew when it became clear that he did not enough have support. Recode adds that “Immelt dropped out of the running this morning, with sources close to his thinking calling the process totally “dysfunctional” (and worse).”

    And while the board was leaning toward Meg Whitman, the chief of Hewlett Packard Enterprise, “matters changed over the course of Sunday afternoon and the board decided on Mr. Khosrowshahi” according to the NYT.

    While not much is known about Dara Khosrowshahi, and why the board thinks the Expedia chief can successfully replace Travis Kalanick as head of the world’s most valuable private company, what is known is that under Khosrowshahi, Expedia was one of the first tech companies to file a legal challenge against Trump’s travel ban, citing the potential harm it could do its employees and customers. As such, the Iranian-American appears to be high on the #resistance totem. His anti-Trump bias was further exposed in his year end note to employees, in which he said he wants to send “just a big thank you to our global employee base for an improved 2016 and certainly an improved end to the year. And hopefully we will all be alive to see the end of next year.”

    Some further background:

    Dara Khosrowshahi has served as CEO of Expedia, Inc., since August 2005. Since that time, Expedia has extended its global presence to more than 60 countries worldwide through Expedia, Hotels.com, and Hotwire online booking brands, and the travel community sites of TripAdvisor Media Network. Ten years later, in 2015, Expedia awarded him $90 million worth of stock options as part of a long-term employment agreement, stating he would stay until 2020. 

     

    Before joining Expedia, Khosrowshahi served as the CEO of IAC Travel. Khosrowshahi worked at Allen & Company from 1991 to 1998, and as its vice president from 1995 to 1998. He is also a board director for BET.com, Hotels.com and several other companies.

     

    In February 2015, the New York Times Company announced Khosrowshahi as one of two new nominees for its board of directors. He will formally stand for election at the annual meeting of stockholders on May 6, 2015. Arthur Sulzberger, Jr., the publisher of the New York Times and chairman of The New York Times Company praised Khosrowshahi’s “comprehensive digital and international experience, as well as significant financial expertise”.

    The search for Uber’s new CEO had been riven by scandal and discord, especially between former CEO Kalanick and Benchmark, the VC firm that is a major Uber shareholder and that also has a seat on Uber’s board. Both Kalanick and Benchmark had their own preferred candidates for a new chief. Benchmark recently sued Kalanick to try and force him off the board.

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Today’s News 27th August 2017

  • Paul Craig Roberts: "There Is A Conspiracy… And It's Against The American People"

    Authored by Paul Craig Roberts,

    In the United States “conspiracy theory” is the name given to explanations that differ from those that serve the ruling oligarchy, the establishment or whatever we want to call those who set and control the agendas and the explanations that support the agendas.

    The explanations imposed on us by the ruling class are themselves conspiracy theories. Moreover, they are conspiracy theories designed to hide the real conspiracy that our rulers are operating.

    For example, the official explanation of 9/11 is a conspiracy theory. Some Muslims, mainly Saudi Arabians, delivered the greatest humiliation to a superpower since David slew Goliath. They outsmarted all 17 US intelligence agencies and those of NATO and Israel, the National Security Council, the Transportation Safety Administration, Air Traffic Control, and Dick Cheney, hijacked four US airliners on one morning, brought down three World Trade Center skyscrapers, destroyed that part of the Pentagon where research was underway into the missing $2.3 trillion, and caused the morons in Washington to blame Afghanistan instead of Saudi Arabia.

    Clearly, the Saudia Arabians who humiliated Ameria were involved in a conspiracy to do so.

    Is it a believable conspiracy?

    The ability of a few young Muslim men to pull off such a feat is unbelievable. Such total failure of the US National Security State means that America was blindly vulnerable throughout the decades of Cold War with the Soviet Union. If such total failure of the National Security State had really occurred, the White House and Congress would have been screaming for an investigation. People would have been held accountable for the long chain of security failures that allowed the plot to succeed. Instead, no one was even reprimanded, and the White House resisted all efforts for an investigation for a year. Finally, to shut up the 9/11 families, a 9/11 Commission was convened. The commission duly wrote down the government’s story and that was the “investigation.”

    Moreover, there is no evidence to support the official conspiracy theory of 9/11. Indeed, all known evidence contradicts the official conspiracy theory.

    For example, it is a proven fact that Building 7 came down at freefall acceleration, which means it was wired for demolition. Why was it wired for demolition? There is no official answer to this question.

    It is the known evidence provided by scientists, architects, engineers, pilots, and the first responders who were in the twin towers and personally experienced the numerous explosions that brought down the towers that is described as a conspiracy theory.

    The CIA introduced the term “conspiracy theory” into public discourse as part of its action plan to discredit skeptics of the Warren Commission report on the assassination of President John F. Kennedy. Any explanation other than the one handed down, which is contradicted by all known evidence, was debunked as a conspiracy theory.

    Conspiracy theories are the backbone of US foreign policy. For example, the George W. Bush regime was active in a conspiracy against Iraq and Saddam Hussein. The Bush regime created fake evidence of Iraqi “weapons of mass destruction,” sold the false story to a gullible world and used it to destroy Iraq and murder its leader. Similarly, Gaddafi was a victim of an Obama/Hillary conspiracy to destroy Libya and murder Gaddafi. Assad of Syria and Iran were slated for the same treatment until the Russians intervened.

    Currently, Washington is engaged in conspiracies against Russia, China, and Venezuela. Proclaiming a non-existent “Iranian threat,” Washington put US missiles on Russia’s border and used the “North Korean threat” to put missiles on China’s border. The democratically elected leader of Venezuela is said by Washington to be a dictator, and sanctions have been put on Venezuela to help the small Spanish elite through whom Washington has traditionally ruled South American countries pull off a coup and reestablish US control over Venezuela.

    Everyone is a threat: Venezuela, Yemen, Syria, Iran, Iraq, Afghanistan, tribes in Pakistan, Libya, Russia, China, North Korea, but never Washington.

    The greatest conspiracy theory of our time is that Americans are surrounded by foreign threats. We are not even safe from Venezuela.

    The New York Times, the Washington Post, CNN, NPR, and the rest of the presstitutes are quick to debunk as conspiracy theories all explanations that differ from the explanations of the ruling interests that the presstitutes serve.

    Yet, as I write and for some nine months to date, the presstitute media has itself been promoting the conspiracy theory that Donald Trump was involved in a conspiracy with the president of Russia and Russian intelligence services to hack the US presidential election and place Trump, a Russian agent, in the White House.

    This conspiracy theory has no evidence whatsoever. It doesn’t need evidence, because it serves the interests of the military/security complex, the Democratic Party, the neoconservatives, and permits the presstitutes to show lavish devotion to their masters. By endless repetition a lie becomes truth.

    There is a conspiracy, and it is against the American people. Their jobs have been offshored in order to enrich the already rich. They have been forced into debt in a futile effort to maintain their living standards. Their effort to stem their decline by electing a president who spoke for them is being subverted before their eyes by an utterly corrupt media and ruling class.

    Sooner or later it will dawn on them that there is nothing they can do but violently revolt. Most likely, by the time they reach this conclusion it will be too late. Americans are very slow to escape from the false reality in which they live. Americans are a thoroughly brainwashed people who hold tightly to their false life within The Matrix.

    For the gullible and naive who have been brainwashed into believing that any explanation that differs from the officially-blessed one is a conspiracy theory, there are available online long lists of government conspiracies that succeeded in deceiving the people in order that the governments could achieve agendas that the people would have rejected.

    If liberty continues to exist on earth, it will not be in the Western world. It will be in Russia and China, countries that emerged out of the opposite and know the value of liberty, and it will be in those South American countries, such as Venezuela, Ecuador, and Bolivia that fight for their sovereignty against American oppression.

    Indeed, as historians unconcerned with their careers are beginning to write, the primary lesson in history is that governments deceive their peoples.

    Everywhere in the Western world, government is a conspiracy against the people.

  • "We're Coming For You": AP Accuses NRA Of "Inciting Violence" Against Journalists

    In a series of videos released earlier this month, the National Rifle Association declared war on mainstream media and their "globalists masters", a sign of the group’s transformation into an advocate for conservative causes beyond protecting the second amendment.

    Predictably, the Associated Press is not happy. In a story about the new campaign – which debuted on the NRA’s NRATV, a web-video platform run by the association – the AP accused the NRA of employing dangerous rhetoric that risked inciting violence against journalists.

    “The election of President Donald Trump and Republican control of Congress meant the National Rifle Association could probably rest easy that gun laws wouldn’t change for at least four years. But the NRA has begun a campaign not against pending legislation but what it sees as liberal forces bent on undoing the progress it’s made — and the political powerhouse is resorting to language that some believe could incite violence.

     

    Using the hashtags #counterresistance and #clenchedfistoftruth, the NRA has put out a series of videos that announce a “shot across the bow,” and say the gun-rights group is “coming for you” and that “elites … threaten our very survival,” terms that suggest opponents are enemy combatants.”

    In a video published earlier this month, NRA spokeswoman Dana Loesch warned the New York Times that the NRA would be “coming for you," adding that the NRA "had re-dedicated itself to exposing the lies of the mainstream press" while shining an uncomfortable spotlight on the relationship between the MSM and "globalist, corporate elites" who oppose the agenda of President Donald Trump… at least until Steve Bannon's departure, which has since been taken over by former Goldman bankers.

    "The times are burning and the media elites have been caught holding the match" Loesch said.

    "We’ve had it with your narratives, your propaganda, your fake news. We’ve had it with your constant protection of your Democrat overlords, your refusal to acknowledge any truth that upsets the fragile construct that you believe is real life. And we’ve had it with your tone-deaf assertion that you are in any way truth or fact-based journalism,” Loesch says. “Consider this the shot across your proverbial bow. … In short? We’re coming for you.”

    The AP countered with various “expert” soundbites who alleged the NRA could inspire an unstable person to incite violence. One of the AP’s sources, a director at the Annenberg Public Policy Center at UPenn, blamed the NRA for trying to incite violence with its videos.

    “Kathleen Hall Jamieson, the director of the Annenberg Public Policy Center at the University of Pennsylvania, said the tone and language is “overwrought rhetoric” that, viewed by the wrong person, could lead to violence. The kicker on one of the videos — “We’re coming for you” — is straight out of the movies, she said, and “that phrase means that violence is imminent and we will perpetrate it.”

    Another source, chairman of the political science department at the State University of New York at Cortland, said the NRA cribbed its “hyperangry” approach from – who else – President Trump.

    “They’re not inventing this hyperangry, nasty partisan tone but piggybacking on Trump’s approach. Of course, NRA voters by and large are Trump voters, so they would be sympathetic to that kind of message,” said Robert Spitzer, chairman of the political science department at State University of New York at Cortland, who has examined the firearms industry and Second Amendment issues extensively.

     

    Spitzer, a member of the NRA as well as the Brady Center to Prevent Gun Violence, said it’s a pattern the NRA has exhibited as the group evolved from an almost exclusive focus on gun safety into a political beacon for conservatives who fear changes to the Second Amendment and the gun industry.

     

    “It was Bill Clinton in the 1990s. In the early 2000s, it was John McCain. It was Hillary Clinton. It was the United Nations. They’ve held up the U.N. as ready to swoop in and take everybody’s guns,” Spitzer said. “The focus of their ire has changed, but the basic message has been the same.”

    In an interesting twist, the AP insinuated that the NRA’s aggressive rhetoric was a ploy to revive gun sales, which have stagnated since Trump took office.

    “The friction between the gun lobby and the media isn’t new. But critics of the NRA contend the organization is relying on the “fake news” mantra started by Trump to whip up its followers after a dip in gun sales that has taken place since Trump succeeded President Barack Obama, who favored stricter gun-control laws.”

    Joe Plenzler, a Marine veteran and NRA member, said the association had “gone well out of the bounds of any sort of sane responsible behavior.”

    “Lately, it seems like they’ve gone well out of the bounds of any sort of sane responsible behavior. If you want to advocate for the Second Amendment, which I unapologetically believe in, that’s fine,” he said. “But I think at the point where you are going to demonize half the American population in a recruitment effort to get more members, I’ve got a big problem with that.”

    So did the NRA cross a line by engaging in a similar – but opposite – campaign to that of the Trump "resistance" (hence dubbed #counterresistance) and has it gone too far by accusing the press of creating "narratives, propaganda, and fake news", the same way the press accuses the "alt right" of doing the same, and who is – ultimately – right? Readers can decide for themselves after watching the video below:

  • China Is Weaponizing Water

    Authored by Eugene Chow via The National Interest,

    Hidden in plain sight is an intimidating Chinese weapon that allows it to hold a quarter of the world’s population hostage without firing a single shot. While much attention has been given to the nation’s fearsome new military hardware, a formidable component in its arsenal has largely escaped notice: dams.

    With more than 87,000 dams and control of the Tibetan plateau, the source of ten major rivers which 2 billion people depend on, China possesses a weapon of mass destruction. With the flip of a switch, the Middle Kingdom can release hundreds of millions of gallons of water from its mega dams, causing catastrophic floods that would reshape entire ecosystems in countries downstream.

    China knows first-hand the destructive power of water. In an attempt to halt advancing Japanese troops during World War II, Chang Kai-Shek, commander of the Chinese Nationalist Army, destroyed a dike along the Yellow River flooding thousands of miles of farmland, killing an estimated 800,000 Chinese, and displacing nearly 4 million.

    It is highly unlikely that China would ever deliberately unleash such a destructive act upon its neighbors, but the fact remains that it wields enormous leverage as an upstream nation by its ability to control life’s most essential resource.

    High in the Himalayan Mountains are what has been dubbed the “Water Towers of Asia.” Seven of the continent’s greatest rivers start life here including the Mekong, Ganges, Yangtze, Indus and Irrawaddy. What begins as dribble from snow melt in the Tibetan plateau builds into mighty rivers that flow across China’s borders before eventually reaching South Asia.

    To satisfy its insatiable demand for electricity and as part of its shift away from coal, China has gone on a dam building spree. In 1949, China had less than forty small hydroelectric dams, but now it has more dams than the United States, Brazil and Canada combined.

    On the upper Mekong alone, China has erected seven mega dams with plans to build an additional twenty-one. Just one of its latest dams is capable of producing more hydropower than all of Vietnam and Thailand’s dams on the Mekong.

    This dramatic increase in dam building activity has had an outsized environmental impact and stoked fears in downstream nations.

    “Beside having environmental issues those dams in Tibet can be disastrous for [India]. They can unleash their fury during earthquake, accidents or by intentional destruction can easily be used against India during war,” said Milap Chandra Sharma, a glaciologist at Jawaharlal Nehru University in New Delhi.

    China’s southern neighbors are not worried without reason. In the past, India has blamed sudden discharges from Chinese dams for several flash floods including one that caused an estimated $30 million in damage and left 50,000 homeless in northeast India.

    Each year, during China’s rainy season, downstream nations are on high alert as Chinese dams release water to ease pressure with little warning.

    “A discharge by a dam will have a domino effect on the whole system, which can cause huge damages,” explained Le Anh Tuan, deputy director of the Research Institute for Climate Change in Vietnam.

    In addition to floods, Chinese dams are also believed to be responsible for worsening droughts. Last year, Vietnam pleaded with China to release water from the Yunnan dam on the Mekong River to ease severe water shortages downstream. China agreed and waters flowed into Cambodia, Laos, Myanmar, Thailand and Vietnam.

    These two extremes not only highlight the environmental impact of Chinese dams, but also serve as a stark reminder of China’s influence over its southern neighbors. These rivers are foundational to life in South Asia, providing drinking water, irrigation for farming, habitats for fisheries and transportation for commerce.

    By controlling the flow of the lifeblood of the region, China has gained enormous power, which has led to accusations of abuse.

    “When it comes to diplomacy, China uses rivers as a bargain chip,” said Tanasak Phosrikun, a Mekong river activist from Thailand.

    China has denied these charges. Last year, in response to rising anger in India over Chinese dams, the state-run Global Times published an op-ed stating, “China-India relations should not be affected by an imaginary ‘water war.’”

    “Frankly, there is no need for India to overact to such [dam building] projects, which aim to help with reasonable development and utilization of water resources,” the piece continued.

    While China denies that a “water war” exists, the nation has refused to share hydrological data with India this year, despite signing an agreement. The data is critical during monsoon season as it helps India more accurately forecast floods and warn its residents, ultimately saving lives and minimizing damage.

    Whether intentional or not, water has become a de facto weapon providing China with significant political leverage over its southern neighbors. As water scarcity worsens with climate change and population increases, the need for this precious resource will grow, amplifying China’s power and intensifying conflict.

    Despite the best efforts of regional partnerships South Asian nations have had little success in encouraging sustainable and responsible development of rivers. With control of the Tibetan plateau by dint of its geography, China is king of the hill when it comes to water in Asia and there is little downstream nations can do to change the whims of this monarch.

  • All The Countries America Has Invaded… In One Map

    From Montezuma to the shores of Tripoli, the US has had a military presence across the world, from almost day one of its independence. For those who have ever wanted a clearer picture of the true reach of the United States military – both historically and currently – but shied away due to the sheer volume of research required to find an answer, The Anti Media points out that a crew at the Independent just made things a whole lot simpler.

    Using data compiled by a Geography and Native Studies professor from Evergreen State College in Olympia, Washington, the indy100 team created an interactive map of U.S. military incursions outside its own borders from Argentina in 1890 to Syria in 2014.

    To avoid confusion, indy100 laid out its prerequisites for what constitutes an invasion:

    Deployment of the military to evacuate American citizens, covert military actions by US intelligence, providing military support to an internal opposition group, providing military support in one side of a conflict, use of the army in drug enforcement actions.

    But indy100 didn’t stop there. To put all that history into context, using data from the Department of Defense (DOD), the team also put together a map to display all the countries in which nearly 200,000 active members of the U.S. military are now stationed.

    For more details, click on the country:

    The three countries with the biggest U.S. presence, according to DOD numbers, are Japan at 39,623, Germany at 34,399 and South Korea at 23,297.

    The publication of the maps comes just after President Donald Trump announced the military would not be pulling out of its 16-year engagement in Afghanistan – a reversal of his previous stance – and that the U.S. would seek stronger ties with India to combat terrorism in South and Central Asia.

  • Matt Taibbi: Media Is The Real Villain (For Creating A World Dumb Enough For Trump)

    Authored by Matt Taibbi via RollingStone.com,

    The craziest part of Donald Trump's 77-minute loon-a-thon in Phoenix earlier this week came when he rehashed his shtick about the networks turning off live coverage of his speech. Trump seemed to really believe they were shutting the cameras off because "the very dishonest media" was so terrified of his powerful words.

    "They're turning those lights off so fast!" he said. "CNN doesn't want its failing viewership to see this!"

    Trump is wrong about a lot of things, but it's hard to be more wrong about any one thing than he was about this particular point.

    No news director would turn off the feed in the middle of a Trump-meltdown. This presidency has become the ultimate ratings bonanza. Trump couldn't do better numbers if he jumped off Mount Kilimanjaro carrying a Kardashian.

    This was confirmed this week by yet another shruggingly honest TV executive – in this case Tony Maddox, head of CNN International. Maddox said CNN is doing business at "record levels." He hinted also that the monster ratings they're getting have taken the sting out of being accused of promoting fake news.

    "[Trump] is good for business," Maddox said. "It's a glib thing to say. But our performance has been enhanced during this news period." Maddox, speaking at the Edinburgh TV festival, added that most of the outlets that have been singled out by Trump are doing a swimming business.

     

     "If you look at the groups that Trump has primarily targeted: CNN, The New York Times, The Washington Post, Saturday Night Live, Stephen Colbert," he said, "every single one of those has seen a quite remarkable growth in their viewing figures, in their sales figures."

    Everyone hisses whenever they hear quotes like these. They recall the infamous line from last year by CBS chief Les Moonves, about how Trump "may not be good for America, but he's damn good for CBS." Moonves was even cheekier than Maddox. He laughed and added, "The money's rolling in, and this is fun. They're not even talking about issues, they're throwing bombs at each other, and I think the advertising reflects that."

    For more than two years now, it's been obvious that Donald Trump is a disaster on almost every level except one – he's great for the media business. Most of us who do this work have already gone through the process of working out just how guilty we should or should not feel about this.

    Many execs and editors – and Maddox seems to fall into this category – have convinced themselves that the ratings and the money are a kind of cosmic reward for covering Trump responsibly. But deep down, most of us know that's a lie. Donald Trump gets awesome ratings for the same reason Fear Factor made money feeding people rat-hair tortilla chips: nothing sells like a freak show. If a meteor crashes into jello night at the Playboy mansion, it doesn't matter if you send Edward R. Murrow to do the standup. Some things sell themselves.

    The Trump presidency is like a diabolical combination of every schlock eyeball-grabbing formula the networks have ever deployed. It's Battle of the Network Stars meets Wrestlemania meets Survivor meets the Kursk disaster. It's got the immediacy of a breaking news crash, with themes of impending doom, conflict, celebrity meltdown, anger, racism, gender war, everything.

    Trump even sells on the level of those Outbrain click-addicting photos of plastic surgery failures. With his mystery comb-over and his great rolls of restrained blubber and the infamous tales of violent fights with his ex over a failed scalp-reduction procedure, Trump on top of being Hitler and Hulk Hogan from a ratings perspective is also a physical monster, the world's very own bearded-lady tent.

    Trump's monstrousness is ironic, since the image of Trump as the media's very own Frankenstein's monster has been used and re-used in the last years. Many in the business are of the opinion that, having created Trump and let him loose in the village, we in the press now have a responsibility to hunt him down with aggressive investigative reporting, to make the world safe again.

    That might indeed be a good idea. But that take also implies that slaying the monster will fix the problem. Are we sure that's true? 

    Reporters seem to think so, and keep trying to find the magic formula. Just this week, staffers at the Wall Street Journal rebelled against editor-in-chief Gerard Baker. Baker, who has long been accused of being too soft on Trump, blasted his people for going too negative on the president in their coverage of the Arizona speech. He sent around a letter asking staff to "stick to reporting what [Trump] said," rather than "packaging it in exegesis and selective criticism."

    Reporters fought back by (apparently) leaking the memo to the rival New York Times. This followed an incident in which a transcript of Baker's recent interview with Trump was leaked to Politico earlier this month. In it, Baker mentions being glad to have seen Ivanka Trump in Southampton, and small-talks with Trump about travel and golf. The implication here is that it's improper or unseemly for a newspaper editor to have a chummy relationship with this kind of a president.

    And it is, sometimes. Reporters who should be challenging presidents and candidates are pretty much always cheating the public when they turn interviews into mutual back rub sessions.

    But these intramural ethical wars within our business may just be deflections that keep us from facing bigger problems – like, for instance, the fact that we have been systematically making the entire country more stupid for decades.

    We learned long ago in this business that dumber and more alarmist always beats complex and nuanced. Big headlines, cartoonish morality, scary criminals at home and foreign menaces abroad, they all sell. We decimated attention spans, rewarded hot-takers over thinkers, and created in audiences powerful addictions to conflict, vitriol, fear, self-righteousness, and race and gender resentment.

    There isn't a news executive alive low enough to deny that we use xenophobia and racism to sell ads. Black people on TV for decades were almost always shirtless and chased by cops, and the "rock-throwing Arab" photo was a staple of international news sections even before 9/11. And when all else fails in the media world, just show more cleavage somewhere, and ratings go up, every time.

    Donald Trump didn't just take advantage of these conditions. He was created in part by them. What's left of Trump's mind is like a parody of the average American media consumer: credulous, self-centered, manic, sex-obsessed, unfocused, and glued to stories that appeal to his sense of outrage and victimhood.

    We've created a generation of people like this: anger addicts who can't read past the first page of a book. This is why the howls of outrage from within the ranks of the news media about Trump's election ring a little bit false. What the hell did we expect would happen? Who did we think would rise to prominence in our rage-filled, hyper-stimulated media environment? Sensitive geniuses?

    We spent years selling the lowest common denominator. Now the lowest common denominator is president. How can it be anything but self-deception to pretend this is an innocent coincidence?

  • Burger King Russia Introduces The "Whoppercoin" – The Fast-Food Industry's First Digital Currency

    In what we believe to be a first for the global fast-food industry, Burger King Russia has reportedly created a virtual currency called the “Whoppercoin.”

    The company has reportedly issued one billion of the tokens using the Waves blockchain platform. According to Fortune, the coin was launched alongside a new loyalty program: For every Whopper purchased, customers will receive one Whoppercoin. However, it’s unclear if the company will accept the digital tokens as payment.

    “The Whoppercoin launched in tandem with a new loyalty program. For each Whopper burger customers purchase, they'll receive one Whoppercoin in a special cryptocurrency wallet. While the coins’ wider use is unclear, some reports suggest that the Whoppercoin will be accepted as payment at Burger Kings across Russia.”

    Burger King’s decision comes amid a thaw in Russia’s posture toward digital currencies. After initially threatening to jail digital-currency users, the Russian government is reportedly considering legislation to legalize digital-currency payments. Earlier this month, an aid to Russian President Vladimir Putin announced that he would be seeking to raise $100 million to build a large bitcoin-mining operation with the goal of eventually claiming 30% of the bitcoin network’s hashing power.

    The Whoppercoin was officially introduced on Aug. 22. Its introduction followed reports earlier this summer that Burger King Russia was planning to start accepting payment in bitcoin.

  • Grant Williams: "History Is About To Repeat Itself Again… And It Might Get Ugly"

    Real Vision's Grant Williams believes that the 76 million retiring Baby Boomers will trigger a major pension crisis. 

    “With that potentially bad situation we could face,” the seasoned asset manager and co-founder of Real Vision TV said in a recent extended Metal Masters interview (full interview below), “holding physical metal, somewhere safe, somewhere outside the banking system, is just a sensible precaution to take.”

    His outlook has changed drastically since he started his first job trading Japanese markets in 1986: “What I walked into at that time was one of the greatest bull market bubbles the world had ever seen, in the Japanese equity market and real estate market.” During this heyday, precious metals weren’t on his radar at all—until a year later, when he witnessed his first stock market crash and started asking some inconvenient questions.

    “I’ve always been a fan of history,” says Williams, who also writes the wildly popular macroeconomic newsletter, Things That Make You Go Hmmm… “So I read financial history and I just kept reading. And it was clear to me that at this point in time, I needed to buy some gold.”

    Until then, the gold price didn’t mean much to him, except as an indicator of other things, so he considers the crashes he witnessed in his career wake-up calls and blessings in disguise.

    The 1987 crash, he says, was more like “a bad day at the office; it came and went so fast… The bounce-back was quick, but it was a real shock to the system that that could happen.” When the dotcom bubble burst, he was well prepared. “I recognized the madness for what it was much sooner… and so that taught me that markets can reverse and just go down.”

    He remembers reading a story about a boy from Chicago who studied in Weimar Germany, and his parents sent him tuition and rent money every month. At some point, “the Reichsmark was going through the roof—four billion to one, compared to one to one a few months earlier—and this kid, with his one hundred dollars that his parents sent him… ended up buying the entire street he lived on, all the houses, and became a landlord.”

    Over the years, his study of monetary history and current economic events has convinced him that it would be prudent to hold some gold as crisis insurance. “I remember I wanted just to buy an ounce of gold… and I very consciously took cash to pay for this thing. I handed over $333 in paper, and [the dealer] gave me this coin.” The experience of holding physical gold in your hand, he says, answers a lot of questions. “People get stuck in this trap of ‘Why does it have value?’ These are the wrong questions to ask, because you’re driving yourself mad. It does. Pure and simple.”

    Williams says gold is still undervalued: “At heart, I’m a value investor, and I think gold offers incredible value now.”

    He says he’s followed the gold market ever since that pivotal day and recommends that everyone should have at least some allocation to precious metals: “I think if you don’t own some gold in your portfolio now, you either don’t understand history, or you don’t want to understand history.”

    Much more from the author of "Things That Make You Go Hmmm" in the full video below.

  • Former Australian PM Admits He Was Passed Out Drunk During Crucial Financial Crisis Vote

    After years of lies and deflections, Australia’s former prime minister Tony Abbott has admitted on a local television program that he missed a crucial 2009 vote on a $42 billion stimulus package intended to shore up the country’s banking system during the financial crisis because he was passed out drunk.

    Abbott, then a member of the Liberal party’s front bench, said he fell asleep on the couch in his office after consuming “quite a few bottles of wine” with two of his peers in the MP’s dining room “and could not be roused.” The next thing he knew, it was morning, and he had missed the vote, according to the Herald Sun.

    The admission comes years after a public row erupted between Abbott and former Labor Treasurer Wayne Swan when, back in 2013, Swan accused Abbott of missing the crucial vote because he drank too much. At the time, Abbott demanded that Swan stop “telling lies” about him, and members of Abbott’s party asked that Swan withdraw his comments from the parliamentary record.

    The disclosure, which was seemingly made on a whim, took Abbott’s friends and opponents by surprise. Abbott served as prime minister for two years between 2013 to 2015 before losing a party leadership vote to his former communications minister and current Prime Minister Malcolm Turnbull.

    Abbott made his big reveal during an interview with Annabel Crabb, the eponymous host of popular Australian politics program “The House With Annabel Crabb.” The interview will be included in an episode set to air on September 5, according to the Herald Sun.

    “There was one famous occasion when Peter Costello, Kevin Andrews and I hung out rather a long time here,” he told Crabb.

     

    “The night that the then-Rudd government was trying to bring in measures to deal with the GFC.

     

    “I think quite a few bottles of wine were consumed by the three of us,” Abbott said with a laugh.

     

    “Peter was close to leaving at that stage, and I think all of us were in a mellow and reflective mood, so the reflections went on for longer, and later, than they should have.

     

    “The impact was rather greater than it should have been.

     

    “I think I famously slept through several divisions.”

    Crabb pressed Abbott to confirm that the rumors about his drinking were, in fact, true.

    “Crabb prompted the former PM to go on, saying, “the story was that you repaired … to the couch in your room and could not be roused”.

     

    Mr Abbott confirmed this is what happened.

     

    “It was a late night sitting, against all OH&S rules as you can imagine,” he said.

     

    “I lay down, and the next thing I knew it was morning.”

    Swan jumped on the opportunity to take a few jabs at his longtime political rival. Both Swan and Abbott continue to serve in Australia’s House of Representatives.

    “When the jobs of Australians were on the line, Tony Abbott didn’t care,” he said.

     

    “His recklessness knows no bounds.”

    While the revelation is amusing, it likely won’t impact Abbott’s chances of retaining his seat. Abbott’s district, Warringah, which is located along the northern edge of Sydney, has long been dominated by Liberal Party politicians.

  • It's Can-Kicking Time Again In The Imperial City

    Authored by David Stockman via The Daily Reckoning,

    You have to hand it to the Donald. He speaks his mind. This week he dropped an unwelcome stink bomb on Capitol Hill during his Phoenix rant Tuesday night. If Mexico won’t pay for my wall, he seemed to say, than Congress will—-even if I have to shutdown the Imperial City to extract the first $1.6 billion of seed money:

    “We’re going to get our wall,” Mr. Trump said at a rally in Phoenix. “If we have to close down our government, we’re building that wall.”

    The Mexican Wall waste an estimated $20 billion needed to complete, and would place ICE agents at the border handing out guest worker papers to anyone who comes across looking for a job. That would mean more domestic production and tax revenue, and a tad less addition to the crushing national debt that Washington is handing generations to come.

    It didn’t take long for Washington’s permanent political class to say “no dice” to the shutdown idea. It seems Speaker Paul Ryan has been domiciled in the Imperial City since he was 21 years old and makes no bones about his priorities.

    “I don’t think anyone’s interested in having a shutdown,” House Speaker Paul Ryan said at a stop at an Intel Corp. facility in Oregon on Wednesday…….

     

    Mr.. Ryan said he expected lawmakers would need to pass a short-term spending bill in September to give them more time to work out a broader budget agreement later this year.

    What has the GOP Congress been doing the last nine months that it hasn’t enacted into law a single one of the 12 annual appropriations bills? The same bills that would provide upwards of $1.1 trillion to run the Pentagon and the domestic agencies.

    The answer is simple. They’ve been deliberately burning up the clock in order to force spending measures through as emergency continuing resolutions (CRs) or 11th hour compromises to keep the government open. This has been going on for years.  It is the very reason Washington now stands on the edge of raising the national debt ceiling above $20 trillion.

    So we’ve officially entered the kick-the-can season. You can count on Paul Ryan to spin and misdirect in order to obfuscate what’s actually going on. The House Speaker is about to capitulate again to the nation’s fiscal doomsday machine. Expect clever maneuvers designed to hide the truth through yet another election cycle.

    That’s exactly what Ryan did back during the 2013 shutdown crisiswhen he negotiated a sell-out deal with ultra-liberal Dem Senator Murray to keep the government open through the 2014 election.

    In that case, he agreed with Sen. Murray to bust the sequesters caps by $64 billion over FY2014-2015.

    Per the typical routine, Ryan got $32 billionon top of the $1.01 trillion already slated to be wasted by the Pentagon during that two year period, while Murray got $32 billion more (a 3.5% increase ) to sprinkle across a myriad of domestic social programs. At the end, all parties were praised by the beltway lobbies.

    Likewise, Ryan’s first act as Speaker after succeeding John Boehner following the shutdown crisis of 2015was to pass the Boehner-Obama deal that suspended the national debt limit and empowered the Obama Treasury to borrow at will.

    That it did!

    As of October 1, 2015, the net debt of the US was $17.66 trillion. After the Ryan-enacted debt limit suspension expired on March 15, 2017, the net debt soared to $19.82 trillion.

    Paul Ryan and Continuing Resolutions in the Imperial City

    This time, Speaker Ryan is going to need to deploy his best tricks to avoid a giant fiscal mishap. That’s because the White House is occupied by the Great Disrupter. By the looks of Trump’s Twitter account he’s still capable of unleashing the kind of impulsive curve ball that the Imperial City simply cannot anticipate.

    Having already complicated the appropriations and CR, the Donald piled on more by suggesting GOP leadership had already screwed up raising the debt ceiling during the few days available when Congress returns from August recess.

    Opined the Donald,

    I requested that Mitch M & Paul R tie the Debt Ceiling legislation into the popular V.A. Bill (which just passed) for easy approval. They……didn’t do it so now we have a big deal with Dems holding them up (as usual) on Debt Ceiling approval. Could have been so easy—–now a mess!

    Here’s the thing. Trump is 70 years old and has spent just eight months in the Imperial City, or about 1.0%of his life. Ryan and McConnell are collectively 122years old and have been playing their trades in the Great Swamp for 82collective years, or two-thirdsof their lives.

    The rank and file Republicans on Capitol Hill desperately fear being blamed for a shutdown. They have bound themselves as hostage to both the Fiscal Doomsday machine and the main street media’s need to safeguard Uncle Sam’s credit at all costs.

    CNN talking boxes would have a field day excoriating the GOP for shutting down the government. Now that the GOP allegedly controls the White House and both chambers of Congress the situation is even more muddled. Thus, as one member of the Freedom Caucus opined to the Wall Street Journal,

    “A government shutdown hurts Republicans—it’s the last thing I want,” said Rep. Trent Franks (R., Ariz.), a member of the House Freedom Caucus who was at Mr. Trump’s rally Tuesday. “It is a political liability of profound significance to us.”

     

    Many GOP lawmakers worry a shutdown or a failure to raise the government’s borrowing limit—another deadline they are facing this fall—could harm their chances of retaining the House majority in next year’s midterm elections. Treasury officials have said Congress must raise the government’s borrowing limit at some point near the end of September.

    The real aim is herding legislators into the Christmas holiday. In that circumstance, as has been proven over and over in the past, not even the most resolute hawks have been able to stand by their convictions. The mantra always becomes “on to next year for real reform!”

    Goldman Sachs, Debt Ceilings and Can Kicking

    But perhaps this time it will be even worse. The Goldman Sachs Regency in the White House would readily sign up for the skinny bill and three-month punt. They are flat-out desperate to keep the casino at bay and the stock average from plunging.

    Assuming that the Donald doesn’t blow-up the proceedings on a skinny bill, the maneuvering for a December deadline would be where the rubber could finally meet the road. That’s because there would need to be at least a $1.5 trillion debtceiling increase just to make it to December 2018 under current tax and spending policy.

    The Treasury will need to borrow $500 billionor more to replenish its depleted cash balances and to pay back the funds which allowed it to pay the bills since March 15. The Treasury will be running upwards of an $800 billionannualized cash deficit between now and December 2018.

    Even with a $1.5 trillion interim debt ceiling increase, there still wouldn’t be room for a single dime of tax cuts on top of the red ink that is already baked in. When it comes to Wall Street’s hope that Congress will pass a tax bill before the end of the year, or the next election – fuggedaboutit!

    There’s no way to get a big enough debt ceiling increase to accommodate the current structural deficits and the Trump Stimulus, without major help from the Democrats.

    The can kicking season is once again here, and this one will be like no other.

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