Apr 07

Today’s News 7th April 2017

  • Clipping Iran's Wings – Winners & Losers From Congress' New Sanctions

    Authored by James Durso via RealClearDefense.com,

     

    Iran’s aviation sector will spend much more time taxiing before takeoff if the Countering Iran’s Destabilizing Activities Act Of 2017 becomes law. The bill enjoys bipartisan support in the U.S. Senate, and the House of Representatives is considering a companion bill, the Iran Ballistic Missiles and International Sanctions Enforcement Act, which also enjoys bipartisan support. 

    The Senate bill has three primary provisions: (1) Imposing mandatory sanctions on persons involved with Iran’s ballistic missile program; (2) Applies terrorism sanctions to the Islamic Revolutionary Guard Corps (IRGC); Requires the President to block the property of any person or entity involved in specific activities related to the supply, sale, or transfer of prohibited arms and related material to or from Iran.  The House bill primarily focuses on throttling the supply chain that supports Iran’s ballistic missile program. 

    The Senate and House bills have the support of Iran-wary groups, such as The American Israel Public Affairs Committee  and the Foundation for Defense of Democracies who feel the bills do not violate the letter or spirit of the “nuclear deal,” the Joint Comprehensive Plan of Action (JCPOA), as they do not target Iran’s nuclear program.  In his Senate testimony in support of the JCPOA, then-Secretary of State John Kerry stated: “We’re not going to come back and just slap [sanctions] on again, but that absolutely does not mean that we are precluded from sanctioning Iranian actors, sectors, as any actions or circumstances warrant.”  The bills face opposition by JCPOA supporters, such as the National Iranian American Council, and the Public Affairs Alliance of Iranian Americans who feel additional sanctions for any reason will derail the JCPOA. (Sanctions levied by the U.S., the European Union, and the United Nations are usually for the proliferation of nuclear weapons or ballistic missile technology, support of terrorism, or egregious human rights violations.)

    In March 2016, the U.S. Treasury Department sanctioned Iranian airline Mahan Air for supporting Iran’s ballistic missile program.  Making Mahan Air a two-time loser, as it was sanctioned in 2011 “for providing financial, material, and technological support” to the Quds Force of the Islamic Revolutionary Guards Corps (IRGC).  Iran Air was also sanctioned in 2011, primarily for transporting goods prohibited under United Nations Security Council Resolution 1803, which required Iran to “cease and desist from any and all uranium enrichment,” and any research and development associated with centrifuges and uranium enrichment. The Iran Air sanctions were lifted to secure Iran’s assent to the JCPOA, but Iran Air and Mahan Air have been active in supporting the Assad regime in Syria, leaving Iran Air vulnerable to non-nuclear-related sanctions in the future.

    Iran has no strategic airlift capability, so it has pressed into service its private and state-owned air carriers, Iran Air, Mahan Air, and Yas Air (formerly Pars Air; sanctioned by the UN, the EU, and the U.S.). These carriers make up Iran’s airbridge to Syria and its allies, the Bashar Assad regime, and Lebanese Hezbollah, a creature of the IRGC.  The Mahan Air fleet and the Iran Air fleet are mostly Airbus airframes; Yas Air’s fleet is mostly Russian aircraft

    In February 2016, Iran Air agreed to purchase 118 Airbus commercial aircraft worth an estimated $27 billion.  In July 2016, Iran Air and Boeing agreed to the sale of 80, and leasing of 29, passenger aircraft worth an estimated $16 billion, with the first deliveries scheduled for 2018.

    Congressional opponents of Iran want to cancel Boeing’s agreement with Iran, but it will be more practical to allow the executive branch sanction the buyer, Iran Air, which will be possible under the Iran Terror-Free Skies Act of 2017.  Thus, Boeing can declare force majeure to avoid contract penalties, and Members of Congress can avoid the bad optics of voting against a large export contract and all those jobs.

    How can the U.S. ensure Iran Air is eliminated as a tool of Iran’s apparat of subversion in Syria?

    • When Iran Air flights make their next appearance in the Syrian theatre of operations in support of the Assad regime or Hezbollah, the U.S. sanctions the airline under the authority of Executive Order 13572, Blocking Property of Certain Persons With Respect to Human Rights Abuses in Syria Or, if the IRGC is designated a terrorist organization, apply sanctions to Iran Air as a confederate of the IRGC. The U.S. may prefer to wait until it has achieved its goals vis-à-vis the Islamic State before acting.
    • Boeing regretfully suspends its dealings with Iran Air.
    • Because the U.S. is concerned about the safety of civil aviation, it reminds interested parties that it did issue a license for the inspection and repair of Iran’s civilian aircraft “so long as those services were performed outside Iran so the parts and services could not be misdirected to Iran’s military aircraft.” Iran refused to take advantage of the license, but it will be useful to remind Iran and its surrogates of this when they wave the bloody shirt when tragedy strikes, which is likely given Iran’s poor aviation safety record.
    • The U.S. refuses export licenses for U.S-made components bound for Airbus aircraft to be sold to Iran Air.
    • If Airbus decides to install substitute components, the U.S. places the type certificates for those models, the narrow-body A320, the long-haul A321, and the long-range A350, under review. (The “type certificate” is issued by a regulating body, such as the American Federal Aviation Administration or the European Aviation Safety Agency, to signify the airworthiness of an aircraft manufacturing design or "type." Once the certificate is issued the design cannot be changed, at least not without significant time and expense.)
    • Once the type certificates are under review, the U.S. approaches the countries that are Iran Air destinations and requests that, due to the now-nonconforming aircraft configurations, the countries withdraw landing privileges for those aircraft. A similar approach will be made to countries along those routes with the request that they deny flight permits to those Iran Air aircraft until the type certificate review is completed  (A “flight permit” is the “permission required by an aircraft to overfly, land, or make a technical stop [a stop for refueling or essential repairs] in any country's airspace.”
    • If the Airbus and Boeing options are off the table, Iran Air may have to turn to Russia and China for aircraft. The U.S. does not have much leverage here, but China and Russia will be dealing with a desperate buyer and will act accordingly.  Russia and China are wise enough to know dealing with a terrorist-designated IRGC is what’s commonly known as a “bad idea” and will pile on restrictions regarding the use of the aircraft to give them an excuse when the aircraft turn up in Syria. However, by then they will have been paid.
    • The clandestine sellers of parts for Iran’s remaining U.S.-origin aircraft will price their wares accordingly.

    Other considerations

    • Boeing will have to be made whole, as the sale has been factored into its stock price, but President Trump’s suggested “big order” of stealthy F/A-18 Super Hornets may do nicely, thank you. Utilization of the Export- Import Bank of the United States (EXIM) would greatly aid in the facilitation of the sale, and perhaps resuscitating the Overseas Private Investment Corporation (OPIC). 
    • The U.S. should re-issue the license for inspection and repair of Iran’s Boeing aircraft at a location outside Iran. America will do this for its own satisfaction as Iran will ignore the offer as it did before.  
    • Iran Air will be unable to compete with the rival carriers from Gulf countries, which the U.S. can trade for something, maybe in the dispute between U.S. and Gulf airlines over government subsidies.

    The winners and losers

    • Winners: Syrian citizens on the receiving end of Iranian guns; Israel, which will get a breather if Hezbollah is hobbled; Lebanese citizens, who will get a breather if Hezbollah is hobbled; Boeing
    • Losers: Airbus; any IRGC smuggling scheme that is using the flights to and from Syria; Iranian citizens, who will lose the chance to travel safely from their prison republic.

  • ISIS, Al-Qaeda Praise Trump's Attack

    Having perhaps lost the support of much of his anti-war base, President Trump appears to have won praise from two new groups…

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    Even even more ironic, today is the 100th anniversary of the United States entering World War One.

  • "Nuclear War Much More Likely" Paul Craig Roberts: In Dangerous World, Putin Will Not Trust America

    Authored by Mac Slavo via SHTFplan.com,

    Don’t be fooled by appearances.

    President Trump is only at war with the Deep State on one level.

    On another, the Deep State already run everything – when it comes to foreign policy, economics, politics and the mainstream narrative that is meant to set & sync headlines, clocks and consumer habits around the world.

    War is brewing, as Trump hinted strongly in his upstart presidential campaign, but it will come, ultimately, at the terms of the long-running organ that actually steers U.S. policy.

    After a very dubious “chemical attack” in Syria to stir the pot (the White Helmets did not even use gloves when picking up, touching and treating supposedly contaminated children), it is clear that war could erupt overnight with any number of middle eastern ‘enemies,’ or with North Korea, Russia or just about anyone else.

    And one narrative that has been almost constant from the establishment power base and their media lapdogs during the last cycle has been dogging Russia in anyway it can – from baseless hacking accusations, to controversial sanctions talks, to attributing ultimate responsibility for chemical warfare attacks.

    One can clearly see that a fight is being picked. If the story doesn’t fit, they’ll force it, or just find another excuse.

    This, in short, is why the well respected Paul Craig Roberts says we are one step closer to “going poof” – it is three steps back to the thermonuclear cold war, only this time the leaders aren’t even attempting to work it out diplomatically.

    According to Dr. Roberts, foreign policy figures in the days of Kennedy and Krushchev were actually attempting to trust and deescalate, fearful of setting things off.

    Today, foreign policy men and woman seem dogged and emboldened by the chance for destruction.

    As USA Watchdog reported:

    Dr. Roberts, formerly a top editor at the Wall Street Journal, says nuclear war is the most dire problem Americans face. This comes at a time when trust between Russia and America is at all-time lows.  Dr. Roberts says, “The danger is both warning systems, ours and the Soviets (Russians).  During the period of the cold war, there were many false alarms of incoming missiles.  Both sides would see incoming missiles, and yet no one believed it, and the reason they didn’t believe it was that the governments were working together to defuse tensions.”

     

    “You had Kennedy with Khrushchev.  You had Nixon who gave us SALT-1, an anti-ballistic missile treaty.  You had Carter who gave us SALT-2.  You had Reagan and Gorbachev who ended the cold war.  So, all during these periods when false information of incoming missiles came in, no one believed it, but if you have distrust between the two powers as we now have, and Putin has said on a number of occasions we can no longer trust the Americans, if you can’t trust and you get incoming missile alerts, you are much more inclined to believe it.  So, the prospect of nuclear war is more likely.  Washington and the media . . . are creating distrust among their populations with Russia with this constant anti-Russian propaganda.  With all this bogus and false allegations about Russia. . . . the chances of all this going poof are very high.”

    via Greg Hunter’s YouTube channel

     

    Combine all the mistrust, aggression and attempts to conflate conflicts into a larger disaster.

    The debt situation, the economics and the social indicators are all abysmal and depressing. The morale of the country has devolved, and mutated strangely with the pockets of information and counter-information that reside online.

    And there are those who’d prefer to torch things off, collect on military industrial contracts during prolonged war, and start things over when people have sobered up to the grim new realities.

    These will be trying times.

  • Pentagon Releases Video Of Tomahawk Cruise Missile Launches

    Having unleashed 59 Tomahawk missiles into Syria, The Pentagon has released video of the attacks against Assad’s assets…

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    And here is video of the impact on the Al Shaerat military airfield being bombed showing the large ammo depot blasts – Syrian opposition says airbase struck by US military was used by Assad regime to ‘kill thousands’…

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    How long until President Trump retweets these images with a ‘punchy’ hashtag?

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    It seems this action should quieten down the Democrats’ Russian narrative for a while?

  • Wall Street Analysts Respond To Syrian Air Strikes

    With stocks tumbling and bonds and bullion bid, Wall Street's best and brightest weigh in on what traders should expect next after news of the cruise missile attack.

    Investors are looking for response from Russia and other countries to gauge market impact of the U.S. strike on Syria (via Bloomberg)

    Westpac Banking Corp (Sean Callow, senior strategist)

    “Markets should have been prepared for U.S. military action given Trump’s comments but the strike was on the early side of expectations, especially since it occurred halfway through the Trump-Xi meeting.”

     

    “While we have probably already seen the sharpest market response, there is likely to be a lingering sense of unease over how quickly Trump switched from rhetorical support for the Syria/Russia storyline about fighting terrorists.”

    Sumitomo Mitsui Trust Bank (Ayako Sera, market strategist)

    “This was a huge surprise, especially at this timing, when Trump is meeting with Xi. People expected North Korea to be on the table as things weren’t going smoothly internally in the U.S. and wanted to focus on external policies — but instead, it was Syria where he took action.”

     

    “Whether the market reaction is temporary or will continue will depend on the reactions from the international community.”

     

    “Hopefully Russia will also be critical of Syria’s gas attack, but without international unity it’s a negative for the U.S.”

    Scotiabank (Gao Qi, currency strategist)

    “Markets will be paying more attention to political and event risks, so it’d be risk-aversion trade going forward. Under such circumstances, emerging-market currencies, including the yuan, tend to be weaker, while the safe-havens like yen would be stronger. Whether it’d turn out to be knee-jerk reaction or medium-term trend, it’d depend on how things evolve in Syria and North Korea.”

    AMP Capital Investors (Shane Oliver, head of investment strategy)

    “It’s a surprise that the strike occurred so quickly. That’s why you’ve seen this risk off right now in markets. Unless this signals some sort of escalation in the war in Syria with heavy increase in U.S. involvement, it’s unlikely to have a lasting impact in markets. We have seen these things in the past and invariably you see the short-term negative reaction, and it proves very short-lived.”

    Principal Global Investors (Jim McCaughan, CEO)

    “The attack on an airfield in Syria is really not surprising in the circumstances. The move to safe havens is more just in case anything goes wrong. If this turns out to be a pretty surgical strike against the Syrian military, I think the market will get over it and recover again.”

     

    “I think the market is really only worried about something going wrong in the execution here. That’s not the most likely outcome. So I think this might be quite temporary in terms of market impact.”

    Capital Investment Management (Alan Tseng, vice president)

    “With the uncertainty in international geo-politics, investors are taking a wait-and-see attitude, reducing their holdings of stocks.”

    For now markets have stabilized after the initial risk off knee jerk lower…

  • "Russian Forces Were Notified In Advance": Pentagon Statement On Air Strikes In Syria

    Pentagon Spokesman Capt. Jeff Davis has issued the following statement on the U.S. strike in Syria in which US ships launched 59 Tomahawk cruide missiles at Syria.

    Statement from Pentagon Spokesman Capt. Jeff Davis on U.S. strike in Syria

     

    At the direction of the president, U.S. forces conducted a cruise missile strike against a Syrian Air Force airfield today at about 8:40 p.m. EDT (4:40 a.m., April 7, in Syria). The strike targeted Shayrat Airfield in Homs governorate, and were in response to the Syrian government’s chemical weapons attack April 4 in Khan Sheikhoun, which killed and injured hundreds of innocent Syrian people, including women and children.

     

    The strike was conducted using Tomahawk Land Attack Missiles (TLAMs) launched from the destroyers USS Porter and USS Ross in the Eastern Mediterranean Sea. A total of 59 TLAMs targeted aircraft, hardened aircraft shelters, petroleum and logistical storage, ammunition supply bunkers, air defense systems, and radars. As always, the U.S. took extraordinary measures to avoid civilian casualties and to comply with the Law of Armed Conflict. Every precaution was taken to execute this strike with minimal risk to personnel at the airfield.

     

    The strike was a proportional response to Assad’s heinous act. Shayrat Airfield was used to store chemical weapons and Syrian air forces. The U.S. intelligence community assesses that aircraft from Shayrat conducted the chemical weapons attack on April 4. The strike was intended to deter the regime from using chemical weapons again.

     

    Russian forces were notified in advance of the strike using the established deconfliction line. U.S. military planners took precautions to minimize risk to Russian or Syrian personnel located at the airfield.

     

    We are assessing the results of the strike. Initial indications are that this strike has severely damaged or destroyed Syrian aircraft and support infrastructure and equipment at Shayrat Airfield, reducing the Syrian Government’s ability to deliver chemical weapons. The use of chemical weapons against innocent people will not be tolerated.

    And moments after the Pentagon statement, House speaker Paul Ryan said that the US action was “appropriate and just.”

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  • Gold Spikes To 5 Month Highs; Stocks, Bond Yields Sink As US Begins Syria Operation

    While the initial reaction to Rex Tillerson's statements was relatively understated, the actions of tonight have sparked a much more considerable move in stocks (lower), bonds (lower in yield), and gold (higher)…

    Gold spiked to the highest since November 10th – erasing 90 % of the post-Trump election losses…

     

    S&P is fading fast…

     

    And 10Y Yields crashed through support to the lowest since Nov 17th…

  • Trump Statement On Syria Air Strikes

    Shortly after he concluded his dinner with Xi Jinping at Mar-A-Lago, Trump authorized the airstrike against Syria in which at least 60 cruise missiles were launched, and delivered the following brief statement:

    My fellow Americans, on Tuesday Syrian dictator Bashar al Assad launched a horrible chemical weapons attack on innocent civilians. using a deadly nerve agent, Assad choked out the lives of helpless men, women and children.

     

    It was a slow and brutal death for so many, even beautiful babies were cruelly murdered in this very barbaric attack. No child of God should ever suffer such horror.

     

    Tonight I ordered a targeted military strike on the airfield in Syria from where the chemical attack was launched. It is in this vital national security interest of the United States to prevent and deter the spread and use of deadly chemical weapons.

     

    There can be no dispute that Syria used banned chemical weapons violated its obligations under the chemical weapons convention and ignored the urging of the UN Security Council.

     

    Years of previous attempts at changing Assad’s behavior have all failed and failed very dramatically. As a result the refugee crisis continues to deepen and the region continues to destabilize threatening the United States and its allies.

     

    Tonight I call on all civilized nations to join us in seeking to end the slaughter and bloodshed in Syria. And also to end terrorism of all kinds and all types.

     

    We ask for God’s wisdom as we face the challenge of our very troubled world. We pray for the lives of the wounded and for the souls of those who have passed and we hope that as long as american stands for justice then peace and harmony will in the end prevail. Goodnight and God bless America and the entire world. Thank you.

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  • Is Your "Democracy" Actually a Totalitarian State? Take This Quick Quiz

    Authored by Charles Hugh-Smith via OfTwoMinds blog,

    The USA is already a Totalitarian State with a Ministry of Propaganda that works overtime to generate a flimsy illusion of "democracy."

    Is your "democracy" (or republic) actually a Totalitarian State? That is, is it a "democracy" or "republic" in name only? To find out, take this quick quiz.

    1. Does your government (federal, state and local) seize citizens' assets without due process? In other words, the rule of law is dead; the state is the law. If the answer is yes, Your "democracy" is already a Totalitarian State. The answer in the USA is a definitive "yes."

     

    2. Does your government impose tyranny by complexity? If so, the average citizen lacks the wealth and connections needed to fight the seizure of private property without due process or recourse. In the USA, the answer is "yes," the government is a tyranny by complexity.

     

    3. Is your government essentially "for sale" to wealthy elites? If the answer is yes, Your "democracy" is already a Totalitarian State–or more accurately, a fascist Totalitarian State.

     

    4. Does your government spy on its entire citizenry? If the answer is yes, Your "Democracy" is already a Totalitarian State. The answer in the USA is a definitive "yes."

    Well, you have your answer: the USA is already a Totalitarian State with a Ministry of Propaganda that works overtime to generate a flimsy illusion of "democracy." Please read the following links if you seek documentation of these systemic abuses of centralized power.

    Orwell and Kafka Do America: How the Government Steals Your Money–"Legally," Of Course (March 24, 2015)

    Government in the USA is expropriating the private property of its citizenry without due process on a vast scale. I have provided documentation of this extraordinary reality many times over the years.

    The various levels of government have a variety of "legal" (haha) means to steal your property without due process or recourse: civil forfeiture, absurdly expensive traffic fines that lead to jail sentences in the local debtors prison-gulag, forfeiture of assets, including land, should government agents find the marijuana plants they planted on your property (surprise!), the state steals your money in a bank account and notifies you after the fact that the state suspects you owe it taxes, though they have zero evidence of that claim–and on and on.

    The courts place no limits on the central state's power, for they are simply one side of the same statist coin, and so we have a totalitarian kleptocracy that in true Orwellian fashion claims it is a functioning "democracy":

    Criminalizing Poverty For Profit: Local Government's New Debtors Prisons (October 20, 2009)

    "Upholding the Law" or Simply Theft by Other Means? (October 26, 2009)

    Theft By Other Means II: When the State Steals Property, Is It Not Theft? (November 10, 2009

    State Over-Reach: Stripmining the Citizenry for Fun and Profit (November 13, 2009)

    Death of Donald P. Scott (Wikipedia); (source):

    "In October of 1992, millionaire recluse Donald Scott and his bride of two months, Frances Plante Scott, lived in a storybook wooded valley in the mountains high above Malibu, Calif. Trails End Ranch is almost completely surrounded by state and Federal park land, and the neighboring government entities had made numerous attempts to buy out Scott and annex his property.

     

    Stymied in their attempt to buy the Scott ranch, government officials hit on an alternative plan. Contending an officer had seen "marijuana plants growing under the trees" during a drug-seeking overflight, agents from various jurisdictions gathered quietly outside the locked gate to the ranch in the morning mists of Oct. 2, 1992.

     

    After greedily studying the maps of the 200 acres of prime land they were told they'd be able to grab under federal asset seizure laws should they find as few as 14 marijuana plants, they cut the chain on the gate with bolt-cutters and raced a mile up the dirt drive to the ranch, complete with police dogs.

     

    Frances Scott was in the kitchen, brewing her morning coffee, when dozens of men in plainclothes and brandishing guns — no badges or warrants in evidence — came swarming in. Understandably, she screamed for her husband, still asleep upstairs.

     

    Donald Scott, 63, came hurrying down the stairs, a handgun held over his head. The officers shouted for him to lower his weapon. He did. They shot him dead."

    Your government in action–completely legally, of course. I hope you approve. The irony of tragedies like this is that when young Americans faced similar "law enforcement" tactics in the late 1960s and early 1970s via COINTELPRO and other blatant violations of constitutional rights, we were written off as radical hippies who were a threat to something (certainly not democracy, but "something." Like perhaps an illegal war and an out-of-control secret government?)

    Now that average citizens are facing similar tactics, they might find it interesting to study the COINTELPRO campaign of the FBI and other "law enforcement" officials against the anti-Vietnam War movement three decades ago.

    According to attorney Brian Glick in his book War at Home, the FBI used four main methods during COINTELPRO:

    1. Infiltration: Agents and informers did not merely spy on political activists. Their main purpose was to discredit and disrupt. Their very presence served to undermine trust and scare off potential supporters. The FBI and police exploited this fear to smear genuine activists as agents.

     

    2. Psychological Warfare From the Outside: The FBI and police used a myriad of other "dirty tricks" to undermine progressive movements. They planted false media stories and published bogus leaflets and other publications in the name of targeted groups. They forged correspondence, sent anonymous letters, and made anonymous telephone calls. They spread misinformation about meetings and events, set up pseudo movement groups run by government agents, and manipulated or strong-armed parents, employers, landlords, school officials and others to cause trouble for activists.

     

    3. Harassment Through the Legal System: The FBI and police abused the legal system to harass dissidents and make them appear to be criminals. Officers of the law gave perjured testimony and presented fabricated evidence as a pretext for false arrests and wrongful imprisonment. They discriminatorily enforced tax laws and other government regulations and used conspicuous surveillance, "investigative" interviews, and grand jury subpoenas in an effort to intimidate activists and silence their supporters.

     

    4. Extralegal Force and Violence: The FBI conspired with local police departments to threaten dissidents; to conduct illegal break-ins in order to search dissident homes; and to commit vandalism, assaults, beatings and assassinations. The object was to frighten, or eliminate, dissidents and disrupt their movements.

    I've published many first-hand accounts of the kleptocratic predation of the state of California. I invite you to read this carefully:

    Welcome to the Predatory State of California–Even If You Don't Live There (March 20, 2012)

    First the state steals the $1,343 and authorizes its parasitic predatory bag-"person" Wells Fargo Bank to steal another $100 for handling the state's theft.

    A week or two later the citizen is notified of the theft as a fait accompli. Now the onus is on the law-abiding citizen to attempt to reclaim his own money from a distant, all-powerful Kafkaesque state agency. How can this be legal in a nation supposedly operating under rule of law?

    Let's be very clear about what happens here in America on a daily basis:

    1. The state (or other agency of government) steals citizen's money without due process.

     

    2. Then, in a move akin to the executioner making the condemned buy his own death bullet, the state authorizes the "too big to fail" corporate bank which received billions in taxpayer bailouts to steal $100 from the citizen for the digital theft of his money by the state.

     

    3. If the citizen needed that money to pay rent, buy medication to stay alive, etc., tough luck, Buckwheat, the state of California has your money before they notify you of the purported tax liability and now you enter the Kafkaesque insanity of pleading for a "refund" of your own money from an agency designed to thwart transparency and the reclamation of your own money.

    So if you get evicted and are living in a cardboard box and pass away due to inability to buy your meds, hey, the State of California's political class and special interests could care less: they want your money and the rule of law doesn't apply to them.

    If you understand that a purported tax liability is one issue and due process is another far more important issue, then you understand that we now live in an totalitarian nation where "rule of law" is only invoked at the convenience of the political and financial Elites for propaganda purposes.

    The state of California has three basic methods of looting law-abiding citizens:

    1. The old "you didn't pay a $25 filing fee, the fine is now $499 which we took from your bank account." Never mind you have the cancelled check endorsed by the state, proving they received it and cashed it; the Board of Kafkaesque Authority claims "we didn't get the check" and loots your account for the $499 (true story.)

    2. "Fishing expeditions" where companies and citizens are dunned for taxes and fees they might owe, though there is no evidence they do in fact owe fees and taxes. I received many emails describing these fishing expeditions, for example, merely having a license is "evidence" that you must have unreported income.

    3. Enforce all sorts of dubious claims, most importantly:

    A. That anyone collecting a pension from work performed while residing in California is liable for California taxes on that pension, regardless of where they live;

    B. Any income resulting from something invented in California must be reported as income in California, regardless of where the income is derived from or where the inventor now lives.

    In other words, residency has no meaning. Any income remotely connected to California–for example, you had the idea while residing in the state–obligates you to pay California income tax on that idea in perpetuity.

    You know the dominant emotion that the government at every level generates in law-abiding, taxpaying citizens? Fear. And for good reason.

    Welcome to the United States of Orwell, Part 1: Our One Last Chance to Preserve the Bill of Rights (March 26, 2012)

    Welcome to the United States of Orwell, Part 2: Law-Abiding Taxpayers Are Treated as Criminals While the Real Criminals Go Free (March 27, 2012)

    "I received a letter last year that we owed the state of California's Franchise Tax Board $90,000 for taxes in the year 2008. We replied to the Franchise Tax board in a similar manner as RT stating that:

     

    — Did not reside in California in 2008

    — Did not file a State income tax return in California in 2008

    — Did not have any outstanding tax issues with California in 2008

    — Did no business in California in 2008

    — Owned no property in California in 2008

     

    The CA Franchise Tax board responded by putting a lien on us in the state – fortunately, our banks and assets have no business in CA or I am certain our accounts would have been robbed as well.

     

    After a great deal of uncertainty and angst, I found an accountant in CA who advised us that we needed to file a complete CA tax return for 2008 even though we did not owe any tax. We filed the return and received a response that we owed the state $625 to cover the State's collection fees. We paid the fee and within two weeks received a "refund" check for the $625.

     

    On reflection, we felt as if we had been "held up" by some powerful gangsters and if it had not been for an honest tax accountant we would have suffered much financial damage."

    Welcome to the United States of Orwell, Part 3: We had to Destroy Democracy in Order to Save It (March 28, 2012)

    Welcome to the United States of Orwell, Part 4: "Consumer Protection" Just Another Federal Reserve Power Grab (March 29, 2012)

    The Dodd-Frank bill, like Obamacare, is tyranny by complexity. Consider the Glass-Steagall Act, at 37 pages in length, and the 2,319-page monstrosity of the Dodd-Frank Wall Street Reform and Consumer Protection Act.

    If you still doubt the government is the tool of elites, please read this:

    The Purchase of Our Republic (by Y. Falkson) (June 5, 2014)

    Centralization and sociopathology are two sides of one coin: the central state:

    Centralization and Sociopathology (May 21, 2013)

    At the lower levels of the kleptocracy, employees of the government enrich themselves by legalizing their own looting.

    Pay Our Pensions Or We'll Throw You in Jail: the Legalization of Looting (March 19, 2014)

    "Improving Public Safety" and Theft By Other Means (January 15, 2010)

    What happens to once-legitimate governments that devolve into totalitarian kleptocracies? They lose their legitimacy ("the Mandate of Heaven") and fall.

    Smith's Neofeudalism Principle #1: If the citizenry cannot replace a kleptocratic authoritarian government and/or limit the power of the financial Aristocracy at the ballot box, the nation is a democracy in name only.

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Apr 06

Today’s News 6th April 2017

  • Necons Demand Action in Syria, While Serious Questions Regarding the Chemical Attack Remain Unanswered

    Today, President Trump ‘changed his mind’ about Syria and Assad, due to the horrific pictures showing victims of a chemical weapons attack that killed dozens in the ISIS controlled city of Idlib. The media has been plastering one dead child after the next — evoking emotional responses from people looking for a villain to bomb. On a much smaller scale, these are the same tactics that were used to draw us into the 9/11 wars, which still persist in all of their horrible, indecorous, calamity, 16 years hence.

    Trump has changed his mind.

    Before we start send sorties into Syria, trying to take out both Russian and Syrian forces, how about we first see evidence proving this was a government sponsored attack?

    Thus far, according to the NY Times, this is all we have — this one flimsy attestation by ‘witnesses.’

    Witnesses said the gas was delivered by a government airstrike. The attacks raised the possibility that the Syrian government used a banned nerve agent, like sarin, after it agreed in 2013 to eliminate its chemical weapons program.

    Fox’s Geraldo ‘Al Capone Punk’d Me from the Grave’ Rivera offered his take, stating the obvious. It made no sense for Assad to use chemical weapons, especially after the US made overtures accepting his rule in the country.

    The US Ambassador to the UN, Nikki Haley, gave an overly dramatic speech regarding the attacks — standing up and showing pictures of dead children, asking Russia ‘how many children have to die before Russia cares?’

    Russian officials have a different account of the events in Idlib. They said Assad attacked an ISIS weapons depot, which had chemical weapons in it.

    Can we be sure who is telling the truth? No.

    But, thanks to social media, some serious facts have been presented, such as people receiving gas masks two days prior to the attacks and an anti-Assad reporter, writing about a chemical gas attack 24 hours in advance. How can we explain this? Personally, I think we’d be fools to believe anything ISIS or the ‘moderate rebels’ have to say on the matter.

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    Let’s examine the timeline and what has just transpired. The war that the neocons have wanted for the past half decade in Syria, displacing Assad for a ‘pro-western’ leader, was just greenlit by Trump. Bannon was booted from the NSC, amidst rumors that Trump’s son in law, Jared Kushner, was leaking info to the Morning Shill, Joe Scarborough. Nikkie Haley sabre rattled Russia, Syria and Iran at the UN. Trump ‘changed his mind.’ Rex Tillerson told Russia to ‘rethink Assad.’

    And, lastly, Trump called Merkel to discuss the Ukraine.

    This is either the best game of 10d waterpolo ever played or we’ve been had.

    One last thing before I go. Motive.

    Content originally published at iBankCoin.com

     

  • With Trump As President Prepping Is More Important Than Ever

    Authored by Brandon Smith via Alt-Market.com,

    I don’t believe it is as pervasive as certain people may think, but there is a notion among some in the liberty movement that with Donald Trump in the White House the need for crisis preparedness has subsided. Because preppers and survivalists tend to lean towards the conservative side of things, the urgency for prepping almost always explodes when the Democratic party is “in power.” As they say, for example, Barack Obama was perhaps the greatest gun salesman in history with the gun industry growing over 158% during his two terms.

    Now with Republican dominance in Congress, Senate and White House, there is a possible temptation for conservatives to become complacent and comfortable once again. In 2017 so far, ATF background checks have dropped by at least half a million since this time last year, and gun company stocks are turning negative. There are also rumors floating around that survival food companies are suffering from a severe crunch in sales. Though I have not yet found this to be substantiated, I can verify that many preppers I deal with on a daily basis seem to have relaxed their guard.

    I would point out that this is not necessarily all due to Trump. The gun market is likely saturated after eight years of Obama, and one must also consider that as the U.S. economy continues to decline, surplus cash used for prep gear is going to dry up. That said, I do think it is important to examine any assumptions liberty activists might have in terms of a Trump driven “recovery.”

    When I began publishing my post-election analysis on what I felt was a predictable Trump win, I did find anger among some activists who decided I was being “too pessimistic,” and that I should join the movement in celebration. Being that I called a Trump presidency half a year in advance based on the premise that the globalists needed a conservative scapegoat for the next phase of the ongoing financial crisis, it was hardly a moment of celebration for me.

    There is a common delusion among those that invest themselves in politics that all that is needed to reverse the course of any nation or situation is a “strong leader” with ample cheerleading from the populace. In reality, social and geopolitical disasters are usually far beyond the means of any one politician to change. Economic disasters are even more irreversible. I wish I could pretend to be optimistic, but I am rather well studied in the history of these kinds of events.

    Conservatives are especially vulnerable to the idea of a “protector on a white horse” coming to their rescue; a God-fearing hero and statesman, a general and leader of men. But, such people do not exist. There are no supermen. There are no worldly saviors. There are only common men, with common failings, destined to face extraordinary obstacles. The great men of history are not born before hand — they are forged in the crucible of crisis. Great men are not great men until proven otherwise. To assume any political leader is a great man beforehand is foolish, to say the least.

    This is why blind faith in a post-Trump renaissance is misplaced. It is something that has yet to be proven, and in the meantime, there are numerous and highly visible dangers on the horizon that demand continued vigilance and preparedness. I will examine one of these primary dangers now…

    The Growing Threat Of Civil Unrest

    As I noted in my post-election analysis, the political Left has been shell shocked by the rise of Trump and their emotional response would undoubtedly be to double down and become progressively more volatile and more violent. I predicted that this would be evident as winter broke and the cold weather subsided.

    The first signs of this are surfacing as May Day is becoming a rally date for social justice mobs bent on disrupting any agenda the Trump administration might have for enforcing immigration laws. The largest of these protests is to be held in Los Angeles, but similar protests are planned nationwide as well.

    From what we have seen from previous rallies, it would not be unfair to expect rioting in May. I say this because a tone shift in the left is taking place and extreme reactions are more frequent. The following video illustrates this clearly, I think…

    Warning – Explicit

    In case you missed it, this guy just pulled an AR-15 on someone simply because they had a MAGA flag on their truck. Not only that, but he FILMED HIMSELF doing it and and apparently posted it on social media. That is how brazen and insane these people are becoming.

    Think of it this way — could you have even imagined something like this happening during the 2012 election? It is important not to become conditioned to such behavior as being “normal.”

    To be sure, this sort of thing will not be happening in certain parts of the country. In my state of Montana, the assailant would have been shot two dozen times over by our highly armed population regardless of his politics just on the self defense principle. And frankly, I am fine with that. Citizens providing security for citizens is the American way.

    What I do have a problem with, though, is the increasing potential for an extreme response from conservatives in the face of leftist lunacy. Meaning, I worry about martial law with conservative support, which in my view is more and more likely over the next two years.

    Contrary to popular belief among tough-government champions, martial law often instigates more violence than it solves. The harsher the crackdown, the more vicious the push-back; the more vicious the push-back the more totalitarianism is rationalized by authorities. It’s a terrible cycle.

    Preparedness in terms of self defense should be self-explanatory here. During widespread mob action the rule of law is usually the first casualty, even when martial law is instituted. You also never know when some nutcase might declare you a “Trump supporter” (whether you are one or not) as he reaches for a weapon.

    It is fascinating to me the level of cognitive dissonance with some liberty activists who seem to think Trump’s first term will be anything other than pure chaos. George Soros, an elitist who often funds the very groups organizing mobs to protest Trump, said it plainly:

    “I think Trump will fail.”

     

    “What’s more Soros predicted that the market’s Trump high will soon turn into a hangover. He called Trump unpredictable and unprepared, and said that combination will end up bad for the market.”

    Soros and his globalist colleagues do not need to field guesses; they ENGINEER the outcomes that they “predict.” Social unrest at this fragile time would result in the exact market instability Soros mentioned, among other problems.

    Look, you may believe Trump is being threatened on all sides by the so-called “deep state,” or you may believe that he has willingly surrounded himself with global elitists because he is a Trojan horse. Either way, the diagnosis for the future is not rosy. It would be naive to think that the globalists would not do everything in their power to foment calamity in the near term. It would be equally naive to believe that such an agenda could be repelled through political means.

    The answer, as always, is a prepared citizenry. This can act as a deterrent as much as a measure of comfort. The more prepared the public is for any eventuality, the less affected we will be by disaster. The less affected we are by disaster, the less fearful we will be when it strikes and the less likely we will be to make stupid decisions such as throwing our support behind martial law and the wholesale erasure of the constitution. The more prepared we are, the fewer options available to the establishment when attempting to lure us into poor collective decisions.

    Prepping means freedom in the face of uncertainty, and times have never been more uncertain. To summarize: A Trump White House calls for more caution, not less.

  • Lee Stranahan: 'Ideological Coup' By Kushner-Linked Goldman Globalists Destroying Trump White House

    After Wikileaks revelations that Citigroup picked Obama’s cabinet, it appears the Trump administration is succumbing to ‘same globalism, different bank.’

    Weeks after the Daily Mail exposed an internal struggle between Kushner-linked Goldman Sachs operatives and Trump advisor Steve Bannon, it has become clear that an “ideological coup” led by globalist bankers is well underway – claiming populist Steve Bannon as their latest victim. This ties in with Roger Stone’s warning that Trump’s son-in-law Jared Kushner has been leaking anti-Bannon information to MSNBC’s Joe Scarborough.

    Well, it appears the Goldman globalists have won… for now. Wednesday evening, former Breitbart lead investigative reporter Lee Stranahan dropped an insightful Periscope video in which he laid out exactly what’s going on in the White House – pointing out who’s running the show, and imploring people to simply research the players for themselves.

    In a nutshell: Weeks after meeting with Goldman Sachs CEO Lloyd Blankfein at the Four Seasons bar in DC, Jared Kushner-friendly Goldman alums have successfully maneuvered Trump’s top advisor Steve Bannon off the Natl. Security Council – further strengthening the globalist cabal’s influence over President Trump. Jared Kushner, it should be pointed out, has a well documented history of donating to Democrats; including Hillary Clinton, Chuck Schumer (D-NY), and Robert Mendez (D-NJ).

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    Let’s look at the ex-Goldman operators within the Trump White House:

    Gary Cohn – recently Goldman’s #2, is Trump’s chief economic advisor – who was granted an unprecedented accelerated payout of $285 Million in order to go work at the White House.

    • Staunch Democrat
    • Huge globalist, led Goldman delegation to restructure Greek debt during financial crisis, helping them hide debt from EU overseers in Brussels.
    • Head of the National Economic Council as of January 20th, 2017
    • Brought in Drew Quinn – lead negotiator of TPP

     

     


    Dina Habib Powell, another top Goldman alum and former president of the Goldman Sachs foundation:

     

    Instead of draining the swamp, Goldman alums Cohn, Powell, and Treasury Secretary Mnuchin are the swamp…

    The populist, nationalist agenda that Donald Trump was elected on is getting pushed out of the White house.

     

    The fact that Powell is in (who was in the Bush administration), as a Security advisor, is deeply troubling. She’s got Ben Rhodes’ old job.

    Goldman Sachs has taken over…

    We voted for the working people who have been taken advantage of by companies like Goldman Sachs. You’ve been screwed by Goldman Sachs. Look up TARP. You didn’t vote for Goldman Sachs.

     

    We did not vote for Globalism.

    And before you say “Wait, Steve Bannon is from Goldman!” – full stop… Bannon addressed how the megabank has changed and no longer shares his values.

    What can Trump voters do?

    Stranahan has one request for any and all who oppose this ideological coup by Goldman Sachs: CALL THE WHITE HOUSE!

    See entire Periscope here:

      

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

  • Euro Saves Germany, Slaughters the PIGS, & Feeds the BLICS

    Authored by Chris Hamilton via Econimica,

    The change in nations Core populations (25-54yr/olds) have driven economic activity for the later half of the 20th century, first upward and now downward.  The Core is the working population, the family forming population, the child bearing population, the first home buying, and the credit happy primary consumer.  Even a small increase (or contraction) in their quantity drives economic activity magnitudes beyond what the numbers would indicate.

    To highlight the linkage of Core populations to economic activity, the chart below shows the European 25-54yr/old population vs. the best indicator of economic activity, total energy consumption (data available starting from 1980).  The implications are pretty straightforward.  European economic activity (& resultant energy consumption) will contract for decades, at a minimum, with the declining Core population.  The pie is shrinking and now it’s simply a fight for who gets bigger slices.

     

    Given this, consider Germany was well aware of it’s post WWII collapsing birth rate and the impact of this on economic growth as this shrinking population of young made it’s way into the Core.  Consider Germany’s Core population peaked in 1995 and it’s domestic consumer base has been shrinking since, now down over 3.3 million potential consumers (about a 9% Core decline…remember a depression is a 10% decline in economic activity, which a 9% and growing decline in German consumers would have almost surely induced).

    GERMANY

    The chart below shows Germany’s Core population from 1950–>2040…but understand this is no guestimate through 2040.  This is simply taking the existing 0-24yr/old population (plus anticipated immigration) and sliding them into the Core through 2040.  Germany’s Core population is set to fall by over 30% or 10+ million by 2040 (far more than the 7 million Germans of all ages who died in WWII).

     

    But Germany had a plan.  With the advent of the EU and Euro just as Germany’s Core began shrinking, Germany was able to avoid the pitfalls of a shrinking domestic consumer base, circumvent the strong German currency, and effectively quadruple it’s effective export market across Europe.  German exports, as a % of GDP, have essentially doubled since the advent of the Euro (22% in ’95 to almost 50% in ’16).  The chart below highlights Germany’s shrinking Core vs. rising GDP (primarily via exports) since 1995.

     

    And this had the desired effect of turning what was a rising German debt to GDP ratio during re-integration of E. Germany into a falling ratio (chart below).

     

    So the German motivation for the EU and Euro are fairly plain as are the resultant economic transfusion from South to North.  But for Germany to be a winner, there had to be a loser in this shrinking pie game.  Hello PIGS (Portugal, Italy, Greece, Spain), you lost.  As the old poker adage goes, when you don’t know who the sucker at the table is…it’s you.  Particularly when you “win big” at first and it all seems so easy…but then it all turns.

    PIGS

    The chart below shows the PIGS Core population peaking about 15 years later than in Germany but likewise clearly rolling over.  By 2040, the PIGS Core population will be back at it’s 1960 levels…down from the 2010 peak by 17 million or about a 30% decline.

    But if we look at the PIGS combined GDP and Core population…we see a very different picture than in Germany.  The chart below shows the PIGS GDP turned down ahead of the Core population peak.  The rise in GDP in these nations was a credit bubble premised on cheap EU wide interest rates more appropriate for Germany.  Exports as a % of GDP (which were higher than Germany’s in ’95) have risen less than half of Germany’s increase (rising as a % primarily due to declining PIGS GDP).  Low German wage increases and high quality German goods helped displace PIGS domestic manufacturing base.

     

    To extend the game a bit longer (and multiply the harm), un-repayable government debt has been substituted to keep the PIGS consuming since 2007 (chart below).

     

    How it played out…

    The chart below shows the impact of the implementation of the EU and Euro on the different parties.  Clearly the PIGS were fattened up on cheap credit.  These nations became used to unsustainably fast growth and the good life, buying really nice German exports and undermining their own national brands.

     

    But then the phony PIGS growth turned to real and deep contraction (chart below).  However, the slowdown was quick and shallow for Germany and the BLICS.  French GDP likewise turned upward after a shallow contraction but did so on a large increase in debt and continuing high levels of unemployment.  Quite the opposite of the trends in Germany.

     

    The raw trade data confirms Germany’s gain against an ageing domestic population came at the expense of the PIGS.

     

    BLICS

    And just to square the circle, I need to talk a little about the BLICS (Belgium, Luxembourg, Ireland, Cayman Island, and Switzerland…yes, I understand Cayman Island is not in Europe, but bear with me as it is a British Overseas Territory).  These nations with a total population of about 24 million have been disproportionate beneficiaries of the new EU system.  These financier nations have been the biggest winners of all with huge amounts of money flowing through them (BLICS GDP below).

     

    But why would small to tiny financier nations be the greatest beneficiary of the new EU?  Untold quantities of nearly free ECB money & distortions does wonders for those who can get their hands on it.  In this respect, a peek at these nations US Treasury holdings is quite telling.  These tiny nations are now five of the top 13 foreign holders of US Treasury’s (Ireland is #3, and Cayman Island #5, Switzerland #6, Luxembourg #7, and Belgium has slipped to #13).  That these are America’s creditors is laughable really!

    I’m just guessing but the timing and size of BLICS Treasury purchases sure looks like it was front running in conjunction with the ECB’s 2011 LTRO and subsequent 2014 TLTRO?!?  The chart below shows the BLICS Treasury holdings back to 2001.  “Financialization” writ large for nations that don’t produce much of anything.

     

    In fact, since the July 2011 debt ceiling debate (debacle?!?) when Congress determined the US would never live within it’s means, it has been the BLICS that have done the heavy lifting to maintain the foreign Treasury bid while China (and cumulative BRICS) have been selling despite record dollar surplus’ (chart below).  As an aside, from ’00 through July ’11, China recycled about 50% of it’s dollar trade surplus into Treasury’s…from July ‘ll China only continues to sell Treasury’s despite record trade surplus…but luckily the BLICS stepped up just as China and the BRICS bowed out.

     

    The chart below highlights that the BLICS are now, as of January 2017, the largest holder of US Treasury debt overtaking the declining holdings of both Japan and China.

     

    Conclusion:

    As Europe’s Core population collapses (and economic activity with it), the Euro and ECB seem to be serving a select few at the expense of the majority.  The imbalances and distortions will only grow as the attempts to mask who the Euro and ECB truly serve continue.  What little vitality exists is being transfused to prop up the few.  Hope this has been thought provoking and make of this what you will.

  • Snowflakes Demand University President's Resignation After Refusal To Support "Safe Spaces"

    Snowflakes at the ultra-liberal Northern Arizona University are demanding that their President, Rita Cheng, step down today after a student asked for her opinion on ‘safe spaces’ and got a rather shocking dose of reality as a reply. 

    During a forum hosted by Cheng, NAU sophomore Breanna Kramer asked the following (per KPNX):

    “How can you promote safe spaces, if you don’t take action in situations of injustice, such as, last week, when we had the preacher on campus and he was promoting hate speech against marginalized students?  As well as, not speaking out against racist incidents like blackface two months ago by student workers followed by no reform and no repercussions?”

    And while Kramer expected a softball response from her school’s president, what she actually got was a heaping dose of ‘real life’…which, of course, immediately ‘triggered’ every snowflake within an earshot of the president’s ‘microaggression‘.

    “As a university professor, I’m not sure I have any support at all for safe space.  I think that you as a student have to develop the skills to be successful in this world and that we need to provide you with the opportunity for discourse and debate and dialogue and academic inquiry, and I’m not sure that that is correlated with the notion of safe space as I’ve seen that.”

    In the aftermath of the atrocity, NAU students took to Facebook to do what all snowflakes do when their bastions of liberalism refuse to bend to their every demand…namely, organize a protest…

    NAU

     

    Meanwhile, the mass-triggering event caused local news agencies to spring into action with a series of accusatory questions…

    Q: What does President Cheng think about the NAU SAC asking for her resignation if she doesn’t provide a safe space for all students?

     

    A: NAU is safe. Creating segregated spaces for different groups on our campus only [leads] to misunderstanding, distrust and [reduces] the opportunity for discussion and engagement and education around diversity. Our classrooms and our campus is a place for engagement and respect – a place to learn from each other.  NAU is committed to an atmosphere that is conducive to teaching and learning.

     

    Q: Does she only bring up diversity and equality on campus when it opens up the school for grant and fund eligibility?

     

    A: President Cheng has been addressing diversity and equality in her words and her actions since the day she arrived at NAU. Her leadership in advocating for our students and their success is reflected in the fact that our enrollment mirrors the diversity of our State.

     

    Q: Is she willing to sit down with NAU SAC representatives (if she hasn’t already) to hear their concerns and see what she can do to address them?

     

    A: Yes. The President is and has always been willing to meet with representatives of student groups. There were hundreds of people at Wednesday’s forum – faculty staff and students.  The few dozen who left, missed the opportunity to hear the questions of others, including several similar to theirs, and the answers that followed.

    We’ll set the over/under at 1 week for Cheng’s remaining tenure at NAU….

     

  • How To Trade The Trump-Xi Summit

    While today’s market was certainly more exciting than many had expected, first surging on the blockbuster ADP report, then plunging in the biggest intraday drop in 14 months after “some” Fed members warned stock prices are “quite high“, there is a chance that it will get even more exciting tomorrow, should either Trump or Xi utter a word “out of place” during the first summit between the two world leaders at Mar-A-Lago.

    How should traders approach tomorrow’s key risk event? Courtesy of Bloomberg’s ex-FX trader Mark Cudmore, here are some thoughts.

    With fundamental trading semi-paralyzed ahead of Thursday’s Trump-Xi meeting, it’s only prices that matter for the moment.

    • The summit between the Chinese and U.S. leaders could have profound implications, but it’s nearly impossible to have any bias going in to the meeting. There’s genuine potential for both positive and negative surprises.
    • As a result, markets are in a holding pattern as we wait to see whether risk-aversion is really ready to step it up a notch. Key levels across assets have not yet broken, with the 2.3% line in 10-year Treasury yields being the most critical.
    • The context is a global economy that’s strengthening. Excess liquidity remains in the system meaning that yield and returns will continue to be chased overall. The flip side is that there are flickers of risk-aversion in markets that are not used to volatility.
    • That environment leads to an adamantly divided market. On one side are those who cite growth and liquidity as a reason to always buy the dip. On the other, those who fear calamity, citing the idea that low volatility has induced excess leverage to chase returns and a misallocation of capital.
    • I have sympathy with both views and while trading each individual asset requires conviction, sensible risk management of a portfolio requires a more balanced perspective. I believe markets are vulnerable to a larger correction this month, but the structural macro story leads me to be bullish longer-term, so I don’t expect a sustained bear market.
    • Thursday’s high-profile meeting may not provide any concrete outcomes, but it’s likely to at least provide sufficient excuses for markets to act, even if it is on a pre-ordained path.

    Unsatisfied by Cudmore’s take? Here are some more analyst opinions on what to expect tomorrow.

    Citigroup Global Markets Asia (Ken Peng, investment strategist)

    • “It’s more a bargaining game rather than one where punishments are doled out”
    • Markets feel “comfortable” as there isn’t universal support in the Republican Party for a protectionist trade policy. Failure of the president’s health-care bill is also a factor
    • Still, hard to predict how talks will pan out

    Oanda Asia Pacific (Jeffrey Halley, senior market analyst)

    • China will strive for market stability during the talks
    • “The chances of the onshore- and offshore-traded yuan being allowed to trade materially weaker while Mr Xi is visiting the U.S. will be almost zero”

    Guotai Junan Fund Management (Guo Rui, vice president)

    • Don’t anticipate any news that will move markets
    • “The meeting will be more likely about two leaders tentatively figuring out each others’ card hands. Trump tends to be hawkish on words, but the meeting itself signals there is common ground for cooperation”

    ING (Jingyi Pan, markets strategist)

    • “The market’s imagination appears to be running wild with the possibilities of the outcome from this meeting”
    • That will likely make many stay on sidelines ahead of the meeting. “A pickup in volatility post event could nevertheless lure traders out”
    • Trump’s past colorfulness when it comes to China’s perceived transgressions means talks could go a number of ways

    ANZ (Khoon Goh, head of Asia research)

    • Still a risk U.S. could take a strong line on China in the Treasury’s semi-annual currency report
    • “Hopefully the Xi-Trump meeting will ease some of the tension”
    • Lack of concern in markets shows traders don’t expect rhetoric over China being a currency manipulator to be followed through

    Mizuho Bank (Ken Cheung, Asia currency strategist)

    • Don’t expect any kind of deal out of the talks
    • Don’t think China will be slapped with manipulator tag
    • “We’re not looking for breaking news that would change the yuan’s outlook at the summit. The meeting will be smooth as Trump has softened his stance against China”

  • Border Wall Bids Emerge; Include Everything From Tourist Attractions To Nuclear Waste Storage

    Yesterday was the deadline for companies to submit bids for Trump’s “physically imposing” yet “aesthetically pleasing” border wall between the U.S. and Mexico.  And while the U.S. government has said they won’t disclose bids, rather just the names of companies actually awarded contracts on June 1st, some of the companies decided to disclose their plans themselves.  Below are a couple of our faves…

    Gleason Partners of Las Vegas, for example, revealed its proposal to line the border wall with solar panels so that it could, among other things, sell electricity to Mexico to help pay for the wall.  Per the AP:

    The panels would provide electricity for lighting, sensors and patrol stations along the wall. Sales of electricity to utilities could cover the cost of construction in 20 years or less, according to the company. Power could also be sold to Mexico.

     

    “I like the wall to be able to pay for itself,” said managing partner Thomas Gleason.

    Border Wall

     

    Another company, Crisis Resolution Security Services, wants to turn the border wall into a massive tourist attraction with beautiful panoramic views of the desert landscapes.

    Crisis Resolution Security Services Inc. of Clarence, Illinois, proposes a wall that is 56 feet (17 meters) high and 22 feet (7 meters) wide at the top — with plenty of room to allow tourists to enjoy desert views.

     

    The height — nearly twice what the government envisions — would deter climbers, and its width would give the structure longevity, said chief executive officer Michael Hari.

    Clayton Industries had the slightly different idea of storing nuclear waste under the wall.

    Clayton Industries Inc. of Pittsburgh proposes storing nuclear waste along the wall in trenches that are at least 100 feet (30 meters) deep.

     

    Money already collected by the U.S. Department of Energy from people who benefit from nuclear power would help pay for the wall.

     

    The bid includes an option for hardware to convert the nuclear waste to energy.

    Meanwhile, a San Diego company decided to focus on the “aesthetically pleasing” component of the RFP…

    Concrete Contractors Interstate of San Diego proposed a polished concrete wall augmented with stones and artifacts specific to areas on the 2,000-mile (3,218-kilometer) border.

     

    Russ Baumgartner, CEO of the company, says the wall should be “a piece of art.”

     

    Customs and Border Protection’s solicitation says the wall should be “aesthetically pleasing” from the U.S. side. Baumgartner wants to decorate both sides.

    Border Wall

     

    …while DarkPulse Technologies chose to focus on the “physically imposing” part.

    DarkPulse Technologies of Scottsdale, Arizona, proposes a concrete wall that can withstand tampering or attacks of any kind.

     

    “You could fire a tank round at it and it will take the impact,” said company founder Dennis O’Leary.

     

    Fiber sensors would be embedded in the concrete to immediately alert officials to any attempts to climb over or tunnel under the wall. It would be coated with a slick coating that would prevent climbing.

    Border Wall

     

    Finally, one snowflake organization, Otra Nation, proposed no border wall at all but rather the “world’s first shared co-nation.”

    Otra Nation, a group of U.S. and Mexican citizens, proposed the world’s first shared co-nation along the border “open to citizens of both countries and co-maintained by Mexico and the United States of America.”

     

    It would also create “nodes of cultural production” such as libraries, museums, galleries and workshops between San Diego and Tijuana, Mexico, and other spots with cities on both sides of the border.

     

    It would prohibit oil drilling and mining and create a “hyperloop transportation system” for people and cargo.

    We’re almost certain Trump will choose the Otra Nation option and just be done with this whole border wall thing.

  • Silicon Valley Survivalist Builds DIY “TsunamiBall” To Ride Out Disaster

    Authored by Mac Slavo via SHTFplan.com,

    Whenever seismic activity kicks up on the planet, earthquakes, volcanoes and tsunamis are triggered.

    Just how big, and how devastating, depends upon chance, and the build-up of pressures within the earth.

    But anyway you slice it, places like Southern California, and globally, the Ring of Fire, are in the danger zone. Many say that it’s just a matter of time.

    With that in mind, survival-minded individuals and disaster preppers have been trying to get ready, and help others get ready, too.

    That’s sort of what happened when Chris Robinson and his Silicon Valley friends and associates got into ‘sketching ideas for tsunami-proof shelters.’

    He says his boss drove home the idea, and brought it up over and over, until he came up with any idea…

    … And started building his own tsunami-proof shelter that he hoped could survive a storm of any size, and keep he and his family safe even if the vessel tumbled, or got knocked.

    As a one-man crew, Robinson went to town with simple plywood, and a lot of patience, until he came up with this fantastic DIY survival vessel, dubbed the ‘Tsunamiball’, featured on one of the best off-grid sites on the web.

    via Kirsten Dirksen:

    A couple years ago Chris Robinson was a former Facebook and PayPal art director with no boat-building (nor sailing) experience. Then the Tsunami hit Japan (a place where he’d lived and met his wife). He happened to be working in a startup incubator at the time with some “very smart people”, including an astronaut, and everyone was sketching ideas for tsunami-proof shelters.

     

    To be sure, Robinson’s house boat isn’t done, and frankly, wouldn’t survive a disaster of any magnitude in its current condition. It hasn’t even been tested on the water.

    But he hopes to use his pet project to inspire others into thinking of better designs, and improving his along the way.

    As Wired Magazine reported:

    The former Facebook and PayPal art director used Adobe Illustrator to sketch his tsunamiball plan (he asked some engineers for help calculating whether it would float). “Very early in the project it became about building this interesting object,” Robinson says. “I’m not a survivalist. I don’t even have life jackets.” He does, however, have an emotional connection to Fukushima—he met his wife there in 1991, when he lived in Japan. “Half the places we went on dates are gone,” he says. Robinson plans to finish the outer shell by May, then ocean-test the vessel if he can find a crane and truck big enough to haul it over to the Pacific. And if the sphere doesn’t sink, he’ll use Airbnb to rent the tsunamiball for tidal wave-safe overnights in Palo Alto.

    Whether it helps out in a disaster or not, the project is fascinating and breathtaking.

    In principle, it is very similar to the ‘Survival Capsule’ that SHTF reported on a little while back:

    In the wake of an extreme threat – such as a tsunami or earthquake – this capsule could be the best place to withstand the impact, no matter what.

     

    It is water-tight. It is extremely durable. It floats, and it can withstand against the impact of super-strong winds, crashes, heat and many other factors.

     

    As the London Guardian reports:

     

    This capsule, which features two small porthole windows so the occupants can see what is going on around them, was created to give individual groups and families more control of their survival in emergency situation than traditional ‘safe houses.’

     

    It is designed to float so it will never be inundated by water levels rising too high, as they do in tsunami situations.

     

    The sphere is designed to withstand the initial impact of a natural disaster, as well as sharp object penetration, heat exposure, blunt object impact, and rapid deceleration.

    How’s your plan for survival? It’s time to think one through if you don’t have one.

  • Bannon Threatened To Quit; Pence Says "Not Demotion"

    In the aftermath of today’s main political event, the removal of Steve Bannon from Trump’s National Security Council, the punditry and the public have been eager to find out if this was a voluntary transition – in Bannon’s own words “I was put on to ensure that [Susan Rice’s NSC] was de-operationalized. General McMaster has returned the NSC to its proper function” – or whether there was a behind the scenes conflict between Bannon and Trump or others in the administration – Reuters reported that Bannon’s removal from the NSC was seen as a boost to H.R. McMaster, who officials said has struggled to work together with Bannon.

    And while it will hardly provide a definitive answer, especially to skeptics, moments ago Fox News’ Martha MacCallum sat down with Vice President Mike Pence for a wide-ranging interview. Pence also addressed the major news stories of the day, where of particular interest was the discussion on the removal of Steve Bannon.

    Asked if the NSC move was a demotion for Bannon, Pence said “not for Steve, not for Ton. These are very highly valued members of our administration. They’re going to continue to play important policy roles. But I think with H.R. McMaster’s addition as our National Security Advisor – a man of extraordinary background in the military – this is just a natural evolution to ensure the National Security Council is organized in a way that best serves the president in resolving and making those difficult decisions,” Pence said.

    That, however, conflicts with what the NYT reported this evening, when the newspaper (as usual relying on “a White House official who, like others, insisted on anonymity to discuss internal deliberations”) said that “Bannon resisted the move, even threatening at one point to quit if it went forward… Bannon’s camp denied that he had threatened to resign and spent the day spreading the word that the shift was a natural evolution, not a signal of any diminution of his outsize influence.”

    His allies said privately that Mr. Bannon had been put on the principals committee to keep an eye on Mr. Trump’s first national security adviser, Michael T. Flynn, a retired three-star general who lasted just 24 days before being forced out for misleading Vice President Mike Pence and other White House officials about what he had discussed with Russia’s ambassador. With Mr. Flynn gone, these allies said, there was no need for Mr. Bannon to remain, but they noted that he had kept his security clearance.

    Of course, the whether the NYT report is trustworthy is just as pertinent.

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    Pence also said that Americans “have a right to know” details about allegations that President Obama’s National Security Adviser Susan Rice asked for the identity of Trump transition team members to be unmasked in intelligence reports.

    “Well I think the American people have a right to know what was going on. And we have every confidence that intelligence committees in the House and the Senate will get to the bottom of all of these allegations,” Pence told Fox News. Rice became the subject of ire from Trump allies earlier this week after media reports said the former Obama official requested the identities of transition team members be unmasked in reports about surveillance of foreign targets. Rice on Tuesday did not deny that she requested the unmasking of identities, but said she would not have done so for political reasons.

    Pence, when asked if Rice should testify in front of Congress, said such a decision is up to lawmakers. “But I would say the American people have a right to know if there was surveillance of any private citizen in this country,” he added in the Fox News interview.

    “And the identity of those citizens was revealed, people ought to have the right to know why. And the fact that it involved out campaign and our transition should be deeply troubling to anyone cherishes civil liberties in this country.”

    Trump, in an interview with the New York Times  earlier on Wednesday, said he thought Rice committed a crime.  “Do I think? Yes, I think.” Trump told the newspaper when asked.

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    Another pertinent topic touched upon by Pence was the alleged chemical weapons attack in Syria, which he said appears to be the work of Syrian President Bashar al-Assad’s regime, and which prompted Trump this afternoon to suggest that his Syria policy may change as a result.

    “No American can look at those images and not be heartsick,” Pence said. “It is a reflection of the failure of the past administration to both confront the mindless violence of the Assad regime and also hold Russia and Syria to account for the promises that they made to destroy chemical weapons.”

    Finally, when discussing Trump’s upcoming meeting with Chinese President Xi Jinping, Pence said he’s expecting a “productive discussion” about the U.S.-China economic relationship. He added that he expects North Korea and its burgeoning hopes of developing nuclear weapons will also be discussed.

    “As the president said this weekend, if China won’t deal with North Korea, we will,” Pence said.

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Apr 05

Today’s News 5th April 2017

  • Dear Statists: I Don't Care About You

    Authored by Joe Jarvis via TheDailyBell.com,

    Dear Statists,

    I don’t care about you, and would really appreciate it if you would stop “caring” about me.

    Now, you might be thinking, “Of course you don’t care about me, you’re a libertarian!” But that is not what I mean. Actually, I do tend to care about other people; I am empathetic of others and therefore advocate free markets, because the closer the globe comes to a free market, the more people are lifted out of poverty.

    But when I say I don’t care about you, what I mean is, I don’t care to force my views on you. I don’t care about you in the sense that the way you live your life doesn’t bother me as long as it doesn’t affect me. I don’t care to try to save you from yourself, and I don’t care to try to force conformity to my ideas of how a life should be lived.

    If it seems like I do care, it is only because we currently live in a society where 51% of the population decides which views will be forced on everyone.

    So I want you to stop forcing me to do things I don’t want to do, but I don’t need to convince you to join me; I don’t care what you do. You don’t have to change your ways, except by letting me change mine.

    I just want you to stop forcing me to live the way you prescribe. My views allow individuals to decide their own solutions to their own problems, so if your solution is to sell yourself into slavery, so be it. But don’t put me on the auction block as well!

    If you allowed me to live the way I want, it would not affect you negatively in the least! In fact, you probably wouldn’t even notice. I don’t need all of society to change, I just need to be freed from your societal chains.

    And no, I am not talking about America in particular, so I can’t just move to another country and live how I want to live. That would be like if you were forcing me to eat at Applebee’s, and I described in detail the unique and healthy dinner I would rather have, and you said, “if you don’t want to eat at Applebee’s, go to another restaurant!”

    The point is I don’t want to eat at any restaurant! I just want to make my own dinner, with my own ingredients that I choose to grow or buy from whomever I wish. But I won’t force you to eat my dinner; you can stay at Applebee’s for all I care! And none of this hurts you, (unless of course, your goal is to force me to fund restaurants.)

    Society will be civilized when you let me do my thing. And I won’t force you to do my thing either. I will be perfectly happy doing my own thing, and if you all still want a government for whatever reason, you can go ahead and do that. Just don’t force me into your club. Don’t initiate violence towards me for not wishing to be involved.

    And if you think this is already an option for me, you are naive and misguided; I would be arrested for committing (victimless) crimes, breaking regulations (that protect me from myself), and not paying taxes.

    You may think I should still be forced to pay taxes, because of the “benefits” I will still be getting from the government. But America doesn’t tax foreigners on vacation to pay for the roads, America is content with the money tourists will pour into the economy while here, in addition to the sales and other taxes they will pay during the visit. The same would happen if I went into your government’s territory.

    But to force me to continue paying taxes, while not using government services, would not be allowing me to go my separate way; I would still be forced to fund your government, which would place an extra burden on my own self governance, as well as force me to convert labor into fiat dollars, which I would not otherwise do. To force a man to fund something which he does not want or use is to admit that you view him as a slave.

    Any of those things would impose extra burdens on me, even if the government goods and services I pay for were forced on me. On the other hand, my opting-out of the system does not impose any extra burdens on the society I am leaving.

    So please, do not join me if you do not wish, and think me crazy and my ideas ludicrous if you must. But in doing so, please do not force me to consort with you or fund your government, and please do not initiate violence against me for doing things which do not harm anyone.

    I will be the first to admit that this agreement is null and void as soon as my activities cause harm, as would be the case with dumping chemicals in rivers, or burning toxic waste. But I think you will find my own desire for healthy living severely restricts the likelihood of that ever happening.

    I promise not to care what you do, if you promise not to care what I do.

    Sincerely,

    Joe Jarvis

    P.S. If you are a Californian statist, I fully support your state going it’s separate way! You shouldn’t be forced into the American club against your will, and should be left alone when you choose to exit. Live and let live.

  • WSJ reports that Susan Rice Was Not Alone In "Unmasking" Team Trump

    As part of its daily wrap of the Susan Rice newsflow, which focused on her first media appearance since she was “outed” as the persona responsible for “unmasking” members of team Trump, the WSJ provides two new pieces of incremental information: i) in addition to Michael Flynn, at least one more member of the Trump transition team was “unmasked” in intelligence reports due to multiple foreign conversations that weren’t related to Russia; and ii) Rice wasn’t the administration official who instigated Mr. Flynn’s unmasking, confirming there is at least one more high-level official giving “unmasking” orders.

    But first, a brief detour.

    “Unmasking” is a term used when the identity of a U.S. citizen or lawful resident is revealed in classified intelligence reports. Normally, when government officials receive intelligence reports, the names of American citizens are redacted to protect their privacy. But officials can request that names, listed as “U.S. Person 1,” for example, be unmasked internally in order to give context about the potential value of the intelligence. Unmasking is justified for national security reasons but is governed by strict rules across the U.S. intelligence apparatus that make it illegal to pursue for political reasons or to leak classified information generated by the process.

    It is the accusation that Rice unmasked members for purely political reasons – ostensibly in coordination with president Obama – that has gotten Republican smelling blood in the water.  Republicans have for weeks signaled that they saw unmasking as the key to investigating the source of media leaks damaging to the Trump administration — such as the exposure of former Trump national security adviser Michael Flynn, who was forced to resign in February after media reports revealed that he misled Vice President Pence about the contents of his discussions with the Russian ambassador.

    To that end, earlier this month, Rep. Trey Gowdy (R-S.C.) pressed FBI Director James Comey in a public Intelligence Committee hearing: “It would be nice to know the universe of people who have the power to unmask a U.S. citizen’s name… because that might provide something of a roadmap to investigate who might’ve actually disseminated a masked U.S. citizen’s name.”

    He went on to press Comey on whether specific Obama officials, including Rice, would have had the authority to request that a name be unmasked. “Yes, in general, and any other national security adviser would, I think, as a matter of their ordinary course of their business,” Comey answered.

    Shortly thereafter, The Hill notes Nunes made his shocking announcement that he — and he alone — had viewed documents that showed inappropriate unmasking by Obama-era officials.

    Today, Susan Rice came out to defend herself and told MSNBC that “the allegation is that somehow, Obama administration officials utilized intelligence for political purposes,” Rice told Mitchell. “That’s absolutely false.”

    She added that “The notion, which some people are trying to suggest, that by asking for the identity of the American person is the same is leaking it — that’s completely false. There is no equivalence between so-called unmasking and leaking.”

    And yet, that is precisely what many republicans are suggesting because otherwise there is no explanation for how the WaPo and NYT received, on a virtual silver platter, stories about Mike Flynn’s communications with intel-level detail.

    Perhaps Rice is simply lying as she lied on March 22 when in a PBS interview she said “I know nothing” about unmasking Trump officials. Less than two weeks later, we learn that she did.

    But perhaps there is more to the story than what we know so far.

    * * *

    And this is where the WSJ comes in, with the new info that according to a Republican official familiar with deliberations by GOP lawmakers on the House Intelligence Committee said that the names of two U.S. citizens who were part of Mr. Trump’s transition team have been unmasked in intelligence reports. One is Mr. Flynn and the other hasn’t been identified. The report involving Mr. Flynn documented phone conversations he had in late December with the Russian ambassador to the U.S.

    The WSJ then reports that Rice had requested the unmasking of at least one
    transition official — not Mr. Flynn —     who was part of multiple foreign
    conversations that weren’t related to Russia.

    And the punchline: “The Republican official and others said Ms. Rice wasn’t the administration official who instigated Mr. Flynn’s unmasking.“

    In other words, the story that Susan Rice is the unmasker is incomplete as there is at least one more person exposing the identities of people in Trump’s circle, and that the NSA and other intel agencies have been surveiling, accidentally or otherwise,  at least one, so far unnamed individual, from Trump’s circle. It may well be someone that the WaPo and NYT have already published about, or it may be someone who has yet to hit the newswire, delivering the latest twist of the ongoing intelligence-fed news cycle.

    For now the answer is unknown, although when Rice testifies under oath before the House Intel Committee, we hope that all outstanding questions will finally get answers.

  • "We Have A Serious Problem": For Jamie Dimon, This Is The Most Troubling Chart About The US Economy

    As discussed earlier, Jamie Dimon’s annual letter this year was a departure from his usual optimistic sermons about the state of nation, dedicating an entire section in the 45 page letter to  describe that “something is wrong” with the US. And of all the items mentions, the following aspect of the US economy is what was most troubling to the JPM CEO. Not surprisingly, it deals with two of the biggest threats facing the US currently: demographics and labor, and shows the at least in one key economic metric, the US is now the worst among the entire universe of developed countries.

    This is what Dimon said:

    Labor force participation in the United States has gone from 66% to 63% between 2008 and today. Some of the reasons for this decline are understandable and aren’t too worrisome – for example, an aging  population. But if you examine the data more closely and focus just on labor force participation for one key segment; i.e., men ages 25-54, you’ll see that we have a serious problem. The chart below shows that in America, the participation rate for that cohort has gone from 96% in 1968 to a little over 88% today. This is way below labor force participation in almost every other developed nation.

     

     

    If the work participation rate for this group went back to just 93% – the current average for the other developed nations – approximately 10 million more people would be working in the United States. Some other highly disturbing facts include: Fifty-seven percent of these non-working males are on disability, and fully 71% of today’s youth (ages 17–24) are ineligible for the military due to a lack of proper education (basic reading or writing skills) or health issues (often obesity or diabetes).

    Incidentally, Dimon’s key concern was initially flagged here back in 2013 and most recently, last summer. For the remainder of the US economic problems listed by Dimon, please refer to the original article.

  • The Next Subprime Crisis Is Here: 12 Signs That The US Auto Industry's Day Of Reckoning Has Arrived

    Authored by Michael Snyder via The Economic Collapse blog,

    In 2008, subprime mortgages almost single-handedly took down the entire financial system, and now a new subprime crisis is here. 

    In recent years, the auto industry has been able to boost sales by aggressively pushing people into auto loans that they cannot afford.  In particular, auto loans made to consumers with subprime credit have been accounting for an increasingly larger percentage of the market.  Unfortunately, when you make loans to people that should not be getting them, eventually a lot of those loans are going to start to go bad, and that is precisely what is happening now.  Meanwhile, automakers and dealers are starting to panic as sales have begun to fall and used car prices have started to crash.  If you work in the auto industry, you might remember how horrible the last recession was, and this new downturn could eventually turn out to be even worse.  The following are 12 signs that a day of reckoning has arrived for the U.S. auto industry…

    #1 Seven out of the eight largest automakers in the United States fell short of their sales projections in March.

    #2 Overall, U.S. auto sales so far in 2017 have been described as a “disaster” despite record spending on consumer incentives by automakers.

    #3 Dealer inventories are now at the highest level that we have seen since the last financial crisis.  Why this is so troubling is because there are a whole lot of unsold vehicles just sitting there doing nothing, and this is becoming a major financial problem for many dealers.

    #4 It now takes an average of 74 days before a dealer is able to sell a new vehicle.  This number is also the highest that it has been since the last financial crisis.

    #5 Not only is Ford projecting that sales will fall this year, they are also projecting that sales will fall in 2018 as well.

    #6 Used vehicle prices are already starting to decline dramatically…

    The used-vehicle price index from the National Automobile Dealers Association posted a 3.8% decline in February compared to the prior month. NADA also said wholesale prices fell 1.6%.

    #7 As I discussed yesterday, Morgan Stanley is projecting that used car prices “could crash by up to 50%” over the next four or five years.

    #8 Right now, more than a million Americans are behind on their payments on their auto loans.  This is something that has not happened since the last financial crisis.

    #9 In 2017, U.S. consumers are more “underwater” on their auto loans than they have ever been before.

    #10 Subprime auto loan losses have soared to their highest level since the last financial crisis, and the delinquency rate on those loans has risen to the highest level that we have seen since the last financial crisis.  By now, I am sure that you are starting to notice a pattern in these data points.

    #11 At this moment, approximately $200,000,000,000 has been loaned out by auto lenders to consumers with subprime credit.

    #12 Just like with subprime mortgages in the run up to the last financial crisis, subprime auto loans have been bundled together and sold as “securities” to investors.  And just like last time around, this has turned out to be a recipe for disaster…

    Many auto loans, including those considered subprime, are securitized and sold to investors. But Morgan Stanley recently reported that the share of auto securities tied to “deep subprime” loans – those given to borrowers with a FICO credit score below 550 — has risen from 5.1 percent in 2010 to 32.5 percent today. It said defaults on those bonds have risen significantly in the past five years.

     

    Almost a quarter of the more than $1.1 trillion in U.S. auto loan debt is owed by subprime borrowers, and delinquency rates have hit their highest point in seven years.

    In the old days, you could always count on the U.S. auto industry to bounce back eventually because of the economic strength of average U.S. consumers.

    Unfortunately, the middle class in America is being systematically hollowed out by long-term economic trends that our leaders in Washington D.C. have consistently ignored.

    We have become a nation of economic extremes.  There are more millionaires in this country than ever before, but meanwhile poverty is exploding in communities all over the country.

    If you live in a prosperous area, things may be going great where you live for the moment.  But as Gallup has discovered, an all-time record high percentage of Americans are worrying “a great deal” about hunger and homelessness these days…

    Over the past two years, an average of 67% of lower-income U.S. adults, up from 51% from 2010-2011, have worried “a great deal” about the problem of hunger and homelessness in the country. Concern has also increased among middle- and upper-income Americans, but they still worry far less than do lower-income Americans.

    You may have plenty of money in your bank account, and so for you hunger and homelessness are not very big issues.  But for those that are just scraping by from month to month, having enough food and a place to sleep at night are top priorities.  Here is more from Gallup…

    Americans at all income levels are expressing greater concern about hunger and homelessness, and it is the top worry among lower-income Americans, who are most likely to struggle to pay for adequate food and housing.

    In addition to the woes of the auto industry, the retail industry is going through the worst wave of store closings in modern American history, pension funds are melting down all over the nation, and stocks are primed for a crash of epic proportions.  Things are lining up just right for the kind of scenario that I laid out in The Beginning Of The End, but unfortunately most people are not listening to the warnings.

    The same thing happened just before the great financial crisis of 2008.  All of the warning signs were there well in advance, and many of the experts were warning about what was coming as early as 2005.  But because it did not happen immediately, a lot of people greatly mocked the warnings.

    But then the fall of 2008 arrived and all of the mockers suddenly went silent.

    As you can see from the numbers that I shared above, a new crisis has already arrived.

    The only question now is how bad it will ultimately turn out to be.

    As always, let us hope for the best, but let us also get prepared for the worst.

  • When Government Evil Triumphs, Freedom Falls

    Authored by John Whitehead via The Rutherford Institute,

    “Government is said to be a necessary evil. The saying appears to be without merit. For can anything be at once necessary and evil? True, all governments have had a history of evil-doing, more or less. However, it does not follow from this experience that their good is indistinguishable from their evil. Governments—assuming a proper limitation of their activities—are necessary and not evil. Their evil begins when they step out of bounds.”—Economist Leonard Read

    It is often said that if America ever ceases to be good, she will cease to be great.

    Unfortunately, the American government has been the opposite of good for too long now.

    In fact, the American government has been very, very, very bad: so bad, in fact, as to be almost indistinguishable at times from the evil it claims to be fighting, whether that evil takes the form of terrorism, torture, drug trafficking, sex trafficking, murder, violence, theft, pornography, scientific experimentations or some other diabolical means of inflicting pain, suffering and servitude on humanity.

    Philosopher Susan Neiman suggests that referring to something as “evil is a way of marking the fact that it shatters our trust in the world.”

    It’s an apt description for a government that keeps violating the sacred trust of its citizenry.

    “We the people” should have learned early on that a government that repeatedly lies, cheats, steals, spies, kills, maims, enslaves, breaks the laws, overreaches its authority, and abuses its power at almost every turn can’t be trusted.

    We haven’t learned.

    We didn’t learn this lesson under George W. Bush. We didn’t learn it under Barack Obama. Although it has become fashionable among the media elite to blame the Trump Administration for all that is wrong with the country, where Americans go wrong is in becoming so fixated on a particular politician that they fail to understand that the fault rests with the Government: the permanent, entrenched Deep State that continues to call the shots in the halls of power.

    Indeed, the evils perpetrated by the U.S. government have been going on for some time now.

    Consider just a few of the ways in which the government—in a misguided, ill-conceived, flawed, bureaucratic and downright Orwellian attempt to fight evil with evil—continues to inflict evil on the citizenry.

    Peddling child pornography to catch child porn consumers: As part of an effort to crack down on child porn consumers and traffickers, for two weeks in 2015, the FBI secretly hijacked a child porn website, improved the technical functionality of the site, and uploaded tens of thousands of images of child pornography to the site. In doing so, the government not only became the largest distributor of child pornography, but it also became the largest exploiter of children. All told, the FBI was accused of hosting an estimated 22,000 images, videos and links of child pornography that more than 100,000 people accessed.

    This is what Douglas Anderson, chair of the University of North Texas' philosophy and religion department, refers to as a cost-benefit analysis. In this instance, the government weighed the cost of inflicting damage on innocent children who were being victimized and preyed upon against the benefits of catching people who download child porn. “It’s a moral conundrum for anyone who takes the view that we are committed to protecting them in all ways,” Anderson said in an interview with the Dallas Morning News. “They're weighing it against these kids’ lives. World opinion says we have a basic duty to protect children. You’d have to have something pretty overwhelming to offset damaging more people. It would have to be awfully extreme to allow even one child to be harmed.”

    Incredibly, after going to such morally questionable depths to catch child porn consumers, the government chose to drop its case rather than be forced to reveal the surveillance and hacking tools it used to set its trap.

    Trafficking weapons to catch drug traffickers. They referred to it as Operation Fast and Furious: a 15-month sting operation carried out by the Bureau of Alcohol, Tobacco, Firearms and Explosives aimed at dismantling Mexican drug cartels and disrupting drug trafficking routes within the United States. Only it didn’t quite work out that way. As the National Review reports, “Under ‘Operation Fast & Furious,’ the U.S. government became a de facto arms dealer to Mexican drug cartels and Islamist criminals.”

    The concept was straight-forward enough: the U.S. government allowed gun sellers and informants to sell approximately 2,000 weapons to gun traffickers in the hopes that the weapons would be tracked to the drug cartels, which would then be targeted and disrupted. Although it appears that the weapons did make it into the hands of the drug cartels, government agents lost track of an estimated 1,400 weapons, many of which were linked to crimes, including the fatal shooting of a Border Patrol agent in 2010.

    Dealing drugs to catch drug dealers. Taking advantage of federal and state asset forfeiture laws that allow police to seize and keep money if they suspect it may be related to criminal activities, law enforcement agencies have been raking in millions of dollars in entrapment schemes in which they sell cocaine to drug users and then bust them for buying it, or lure big-city drug dealers to suburban towns with promises of big sales and then bust them in the act.

    As the Sun Sentinel reports:

    Police in this suburban town best known for its sprawling outlet mall have hit upon a surefire way to make millions. They sell cocaine. Undercover detectives and their army of informants lure big-money drug buyers into the city from across the United States, and from as far north as Canada and as far south as Peru. They negotiate the sale of kilos of cocaine in popular family restaurants, then bust the buyers and seize their cash and cars. Police confiscate millions from these deals, money that fuels huge overtime payments for the undercover officers who conduct the drug stings and cash rewards for the confidential informants who help detectives entice faraway buyers… Undercover officers tempt these distant buyers with special discounts, even offering cocaine on consignment and the keys to cars with hidden compartments for easy transport. In some deals, they’ve provided rides and directions to these strangers… Many of the drug negotiations and busts have taken place at restaurants around the city’s main attraction, Sawgrass Mills mall, including such everyday dining spots as TGI Fridays, Panera Bread and the Don Pan International Bakery.

    Fighting wars abroad by fueling wars abroad. The United States, the world’s largest exporter of arms, has been selling violence to the world for too long now. Controlling more than 50 percent of the global weaponry market, the U.S. has sold or donated weapons to at least 96 countries in the past five years, including the Middle East.

    Some of these weapons inevitably end up in our enemies’ hands, as well as those of terrorists. For instance, the Pentagon’s efforts to train Syrian fighters ended with most of the infantrymen voluntarily surrendering their U.S.-provided equipment to extremist groups. These weapons—precision guided weapons or smart bombs, cluster bombs, and depleted uranium shells, among others—are also responsible for the deaths of innocent civilians in Yemen, Syria and elsewhere.

    As Mother Jones reports:

    Arms deals are a way of life in Washington. From the president on down, significant parts of the government are intent on ensuring that American arms will flood the global market and companies like Lockheed and Boeing will live the good life. From the president on his trips abroad to visit allied world leaders to the secretaries of state and defense to the staffs of US embassies, American officials regularly act as salespeople for the arms firms. And the Pentagon is their enabler. From brokering, facilitating, and literally banking the money from arms deals to transferring weapons to favored allies on the taxpayers' dime, it is in essence the world's largest arms dealer.

    Creating terrorists in order to snare terrorists. The FBI has a long, sordid history of inventing crimes, breeding criminals and helping to hatch and then foil terrorist plots in order to advance its own sordid agenda: namely, amassing greater powers under the guise of fighting the war on terrorism.

    Investigative journalist Trevor Aaronson argues convincingly that “the FBI is much better at creating terrorists than it is at catching terrorists.” According to Aaronson’s calculations, the FBI is responsible for more terrorism plots in the United States than al Qaeda, al Shabaab and the Islamic State combined.

    One of the government’s tactics involves radicalizing impressionable young men in order to create and then “catch” terrorists. Under the guise of rooting out terrorists before they strike, the FBI targets mentally ill or impressionable individuals (many of whom are young and have no prior connection to terrorism), indoctrinates them with anti-American propaganda, pays criminals $100,000 per case to act as informants and help these would-be terrorists formulate terror plots against American targets, provides them with weapons and training, and then arrests them for being would-be terrorists. This is entrapment, plain and simple, or what former FBI director Robert Mueller referred to as a policy of “forward leaning – preventative – prosecutions.”

    Spreading disease in order to cure disease. For years, the American government conducted secret experiments on an unsuspecting populace—citizens and noncitizens alike—making healthy people sick by spraying them with chemicals, injecting them with infectious diseases and exposing them to airborne toxins. The government reasoned that it was legitimate to experiment on people who did not have full rights in society such as prisoners, mental patients, and poor blacks.

    The mindset driving these programs has, appropriately, been likened to the unethical experiments carried out by Nazi doctors. In Alabama, for example, 600 black men with syphilis were allowed to suffer without proper medical treatment in order to study the natural progression of untreated syphilis. In Connecticut, mental patients were injected with hepatitis. In Maryland, sleeping prisoners had a pandemic flu virus sprayed up their noses. In Georgia, two dozen “volunteering” prison inmates had gonorrhea bacteria pumped directly into their urinary tracts through the penis. In Michigan, male patients at an insane asylum were exposed to the flu after first being injected with an experimental flu vaccine. In Minnesota, 11 public service employee “volunteers” were injected with malaria, then starved for five days. In New York, dying patients had cancer cells introduced into their systems. And in Staten Island, children with mental retardation were given hepatitis orally and by injection to see if they could then be cured.

    These incidents are just the tip of the iceberg when it comes to the atrocities the government has inflicted on an unsuspecting populace in the name of secret experimentation. For instance, there was the U.S. military’s secret race-based testing of mustard gas on more than 60,000 enlisted men. And then there was the CIA’s MKULTRA program in which hundreds of unsuspecting American civilians and military personnel were dosed with LSD, some having the hallucinogenic drug slipped into their drinks at the beach, in city bars, at restaurants.

    Are you starting to notice a pattern here?

    For too long now, the American people have been persuaded to barter their freedoms for phantom promises of security and, in the process, have rationalized turning a blind eye to all manner of government wrongdoing—asset forfeiture schemes, corruption, surveillance, endless wars, SWAT team raids, militarized police, profit-driven private prisons, and so on—because they were the so-called lesser of two evils.

    No matter how you rationalize it, the lesser of two evils is still evil.

    There’s a scene in The Third Man, Carol Reed’s influential 1949 film starring Joseph Cotten and Orson Welles in which a rogue war profiteer (Harry Lime) views human carnage with a callous indifference, unconcerned that the diluted penicillin he’s been trafficking underground has resulted in the tortured deaths of young children.

    Challenged by his old friend Holly Martins to consider the consequences of his actions, Lime responds, “In these days, old man, nobody thinks in terms of human beings. Governments don’t, so why should we?”

    “Have you ever seen any of your victims?” asks Martins.

    “Victims?” responds Lime, as he looks down from the top of a Ferris wheel onto a populace reduced to mere dots on the ground. “Look down there. Tell me. Would you really feel any pity if one of those dots stopped moving forever? If I offered you twenty thousand pounds for every dot that stopped, would you really, old man, tell me to keep my money, or would you calculate how many dots you could afford to spare?”

    Lime’s callous indifference is no different from the U.S. government’s calculating cost-benefit analyses. After all, to the government, “we the people” are little more than faceless numbers, statistics and economic units to be bought, sold, bartered, traded, tracked, tortured, spied upon, caged like animals, treated like slaves, experimented upon, and then discarded and left to suffer from the after-effects.

    As John Lennon summed it up, “We’re being run by maniacs for maniacal ends.”

    Is the government evil? You tell me.

    The same government that laced the fog over San Francisco with bioweapons, sprayed bacteria from Navy ships off the coast of Norfolk and San Francisco, exposing all of the city’s 800,000 residents, and staged “mock” anthrax attacks covering territory as wide-ranging as Ohio to Texas and Michigan to Kansas has also taken every bit of technology sold to us as being in our best interests—GPS devices, surveillance, nonlethal weapons, behavioral methods, etc.—and used it against us, to track, control and trap us.

    The same government that propelled us into endless oil-fueled wars and military occupations in the Middle East that wreaked havoc on our economy, stretched thin our military resources and subjected us to horrific blowback has also turned America into a battlefield, transforming law enforcement agencies into extensions of the military, conducting military drills on domestic soil, distributing “free” military equipment and weaponry to local police, and desensitizing Americans to the menace of the police state with active shooter drills, color-coded terror alerts, and randomly conducted security checkpoints at “soft” targets such as shopping malls and sports arenas.

    Likewise, the same government that—as part of its so-called “war on terror”—passed laws subjecting us to all manner of invasive searches and surveillance, censoring our speech and stifling our expression, rendering us anti-government extremists for daring to disagree with its dictates, locking us up for criticizing government policies on social media, encouraging Americans to spy and snitch on their fellow citizens, and allowing government agents to grope, strip, search, taser, shoot and kill us has also—in a so-called effort to keep the schools safe— locked down the schools by installing metal detectors and surveillance cameras, adopting zero tolerance policies that punish childish behavior as harshly as criminal actions, and teaching our young people that they have no rights, that being force-fed facts is education rather than indoctrination, that they are not to question governmental authority, that they must meekly accept a life of censorship, round-the-clock surveillance, roadside blood draws, SWAT team raids and other indignities.

    How can you ever trust the government again?

    As I make clear in my book Battlefield America: The War on the American People, you shouldn’t have trusted the government in the first place. It was Thomas Jefferson who warned, “In questions of power then, let no more be heard of confidence in man, but bind him down from mischief by the chains of the Constitution.”

    Unfortunately, as Carl Sagan recognized, “If we’ve been bamboozled long enough, we tend to reject any evidence of the bamboozle. We’re no longer interested in finding out the truth. The bamboozle has captured us. It’s simply too painful to acknowledge, even to ourselves, that we’ve been taken. Once you give a charlatan power over you, you almost never get it back.”

    How do you fight evil? Start by recognizing it. Talk about it. Refuse to play politics with your principles. Don’t settle for the lesser of two evils. Stop being apathetic.

    As British statesman Edmund Burke warned, “The only thing necessary for the triumph of evil is for good men [and women] to do nothing.”

  • Visualizing How Much State Debt Rests On Your Shoulders?

    How much state debt is there per person, and, as Visual Capitalist's Jeff Desjardins asks, why is there such a wide discrepancy between states like Massachusetts ($11,000 per person) and Nebraska ($1,000 per person)?

    THE SNOWBALL OF STATE DEBT

    Today’s infographic from HowMuch.net, a cost information site, organizes states by debt per capita using a snowball-like effect.

    Courtesy of: Visual Capitalist

     

    The five states at the center of the snowball with the highest debt per capita are Massachusetts ($11,000), Connecticut ($9,200), Rhode Island ($8,900), Alaska ($8,200), and New Jersey ($7,400).

    On the other end of the spectrum are the five states with the lowest state debt per capita: Tennessee ($900), Nebraska ($1,000), Nevada ($1,200), Georgia ($1,300), and Arkansas ($1,500).

    While it is reasonable to expect big differences in debt per capita between countries, seeing an interstate difference of up to 10x per person seems a bit perplexing at face value. Let’s see if we can dig a little deeper on what accounts for these differences.

    THE CURIOUS CASE OF MASSACHUSETTS

    Currently, Massachusetts holds the title of the highest state debt per capita, as well as ranking #2 in terms of state debt as a percentage of GDP (14.0%). It’s also worth noting that debt analysts at S&P have recently lowered the outlook on state bonds from stable to negative.

    Meanwhile, The Mercatus Center ranked Massachusetts in 49th place in their 2016 State Fiscal Rankings. (The only state to fare worse was Connecticut.)

    Mercatus snapshot for Massachusetts

    Like other old and urban states, Massachusetts requires significant investments to repair aging roads, schools, and other infrastructure. For many fiscal analysts, however, it is the gap in unfunded liabilities that is the long-term concern.

    Forbes notes that unfunded liabilities from public pensions are probably the biggest fiscal problem facing state governments today, and Massachusetts is no exception. Unfunded liabilities in the state are pegged at $94.45 billion with other postemployment benefits (OPEB) at $15.38 billion, and eventually these are issues that will have to be dealt with.

    HEALTHIER BUDGETS

    What does a healthier state budget look like? The best examples can be found in the Midwest.

    Here’s Nebraska, which has about $1,000 of debt per person:

    Mercatus snapshot for Nebraska

    Nebraska exhibits strong fiscal health across all categories. On a cash basis, Nebraska has between 3.81 and 5.02 times the cash needed to cover short-term liabilities. Revenues exceed expenses by 7 percent, producing a surplus of $294 per capita.

     

    – Mercatus Center at George Mason University

     

  • House Intel Panel Wants Susan Rice To Testify

    If former National Security Advisor Susan Rice though she could get away from the current furore over the Trump “unmasking” scandal with just one MSNBC interview in which Andrea Mitchell did not even ask her why she lied two weeks ago to PBS, she will be disappointed because the House Intelligence Committee has officially asked Susan Rice to testify, supposedly under oath.

    As the WSJ reports, citing two officials familiar with the matter, Rice who served as national security adviser under former President Barack Obama, is on a list of witnesses drawn up by the committee as part of its probe. House Republicans and Democrats have agreed upon a preliminary list of about 30 witnesses that officials say will be expanded as needed. Formal requests to testify haven’t been sent yet by the committee to the witnesses.

    As everyone knows by now, the White House and Rep. Devin Nunes (R., Calif.), the House panel’s chairman, have charged the Obama administration improperly used surveillance information that included “unmasking” the names of Trump transition team members for political gain ahead of handing over the White House.

    Earlier on Tuesday, speaking to MSNBC, Rice said she didn’t use intelligence about Mr. Trump’s associates for political purposes and said she didn’t leak anything regarding her successor, Mike Flynn. In the television interview, she also described requests to unmask the identities of Americans mentioned in intelligence reports as necessary to do her job and entirely different than leaking classified information.

    “The notion, which some people are trying to suggest, that by asking for the identity of an American person, that is the same as leaking it, is completely false,” Ms. Rice said on MSNBC. “There’s no equivalence between so-called unmasking and leaking. The effort to ask for the identity of the American citizen is necessary to understand the importance of an intelligence report in some instances.”

    However, she declined to comment on whether she had made such requests with respect to people associated with Trump who may have been mentioned in intelligence reports. She was also not asked why she lied in an interview two weeks ago on PBS in which she said she had no information about any “unmasking.”

    A Republican official familiar with deliberations by GOP lawmakers on the House Intelligence Committee said the names of two U.S. citizens who were part of the Trump transition team have been unmasked in intelligence reports. One is Mr. Flynn and the other hasn’t been identified, said the official, adding that this person appeared in a report that had nothing to do with Russia, unlike the report featuring Mr. Flynn, which documented phone conversations he had in late December with the Russian ambassador to the U.S.

     

    Flynn was forced to resign after misleading White House officials and Vice President Mike Pence about the nature of those conversations, which current and former officials said concerned the possible easing of Obama-era sanctions on Russia. The existence of those conversations was leaked to the media in January, almost exclusively to the WaPo and NYT.

    The question is who did the leaking.

    The Republican official and others said Rice wasn’t the administration official who instigated Flynn’s unmasking. Rice acknowledged in her televised interview Tuesday that she requested names of Americans be unmasked in intelligence files. But she refused to comment about whether she sought the unmasking of any Trump transition members.

    “The additional unmasking of an American is a disaster,” the Republican official said. “There was no reason to unmask that name.”

    Rice said in the MSNBC interview that she couldn’t get into which names were unmasked in specific reports. “I don’t know what Devin Nunes reviewed at the White House,” she said. “What I can say is that  there is an established process for senior national security officials to ask for the identity of U.S. persons in these reports.” Rice also said she didn’t know what reports were being referred to “by those who are putting out this story.” 

    “I don’t know what time frame they were from, I don’t know the subject matter, and I don’t know who they think was collected upon,” she said.

    Rice also said she didn’t leak the name of Mr. Flynn.  “I leaked nothing to nobody and never have and never would,” Rice said.

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    The process of unmasking, like many actions within the U.S. intelligence apparatus, is highly secretive and contentious because they themselves are classified and revealing them publicly could be a crime.

    And while Susan Rice may not have “known” much in her MSNBC interview, she will have to come up with answers during her sworn testimony.

    At which point the only question on everyone’s lips will be: will she plead the Fifth?

  • Paul Craig Roberts On The Real Russiagate: "Obama's Stasi State"

    Authored by Michael Hudson and Paul Craig Roberts,

    Mike Whitney has written an excellent expose of the “Russiagate” cover story for Obama’s political use of national security to help his party oppose Republicans. 

    Covert surveillance of politicians on Obama’s Nixon-like “Enemies List” has been going on for many years, but is only now being unmasked as a result of the failure of Obama’s cover story–“We weren’t spying on political opponents; only on Russians to protect America.”

    The presstitute media has passed on the cover story authored by former Obama-administration officials led by CIA director John Brennan, FBI director James Comey, the DNC, and Democratic Rep. Adam Schiff. The loose ends in this cover-up have now been so widely exposed as hearsay and political that only 13% of Republicans believe the fact-free story – but 67% of Democrats cling to it.

    Whitney reports that Comey began the investigation in July 2016. As of last Friday (March 31, 2017) not a scrap of evidence has turned up. This did not deter Comey from telling Congress that Putin “hated Secretary Clinton so much that the flip side of that coin was that he had a clear preference for the person running against the person he hated so much.” So the Russians allegedly “engaged in a multifaceted campaign to undermine our democracy.”

    Comey based this conclusion on what has become a hilarious bit of gullibililty.

    The Russians, he said “were unusually loud in their intervention. It’s almost as if they didn’t care that we knew, that they wanted us to see what they were doing.”

    Alternatively, someone wanted investigators to infer that the Russians were doing the hacking. As Wikeleaks Vault 7 releases prove, the CIA can hack computers and leave anyone else’s signature. Due to poor security, the CIA’s cybertechnology ended up in the Internet domain.

    “They’ll be back. They’ll be back, in 2020. They may be back in 2018,” warned Mr. Comey. But who is the “they”? “They” seem to be “us,” or at least what numerous former national security officials have suggested: either the NSC, CIA or its “Five Eyes” partner, British MI6.

    Wall Street Journal editorialist Kimberley A. Strassel poses the real question: Why hasn’t the Trump administration had the Secret Service to arrest Comey, Brennan, Schiff, the DNC and Hillary for trying to overthrow the President of the United States?

    “Mr. Nunes has said he has seen proof that the Obama White House surveilled the incoming administration—on subjects that had nothing to do with Russia—and that it further unmasked (identified by name) transition officials. This goes far beyond a mere scandal. It’s a potential crime.”

    What we are watching is turning out to be traces of a plot against a government elected by the American people. Attempts to get at the truth by House national security committee Chairman Devin Nunes have been countered with demands by Democrats to recuse himself so as to stop his exposé of how “Team Obama was spying broadly on the incoming administration.”

    It seems that this has been going on for many years now. Former Rep. Dennis Kucinich has dropped a bombshell about what appears to be his own illegal surveillance under Obama’s NSC.

    “When the president raised the question of wiretapping on his phones in Trump Tower, he was challenged to prove that such a thing could happen. It happened to me.”

    Here’s what happened, which was revealed two years after he left office in 2013 when the Democrats were overjoyed to see Ohio Republicans redraw the election district lines to get rid of his candidacy. The Washington Times asked him to authenticate a secret recording of a cell phone call “from Saif el-Islam Qaddafi, a high-ranking official in Libya’s government and a son of the country’s ruler, Moammar Qaddafi.”

    Before taking the call, Rep. Kucinich “checked with the House’s general counsel to ensure that such a discussion by a member of Congress with a foreign power was permitted by law.”

    “I was assured that under the Constitution a lawmaker had a fundamental duty to ask questions and gather information—activity expressly protected by the Article I clauses covering separation of powers and congressional speech and debate.”

    Given the quality of the recordings was excellent on both ends of the call, Kucinich concluded that “the tape was made by an American intelligence agency and then leaked to the Times for political reasons. If so, this episode represented a gross violation of the separation of powers.”

    His repeated Freedom of Information Act requests made in 2012 before leaving office have been stonewalled by the intelligence agencies for five years.

    We are now in a position to see the real story behind “Russiagate.”

    It’s not about Russia. The real news is the Obama regime’s abuse of the government’s surveillance powers to spy on Donald Trump and other Republicans in order to build a dossier for the DNC to leak to the press in an attempt to slander or compromise Trump and throw the election to Hillary.

    They’ve been caught, but we can now see that they took steps to protect themselves against this. They prepared a cover story. They pretend they were not spying on Trump, but on Russians – which only by fortuitous happenchance turned up alleged incriminating smoke against Trump.

    This cover story was buttressed by the fake news story prepared by former MI6 freelancer Christopher Steele. As Whitney reports, Steele “was hired as an opposition researcher last June to dig up derogatory information on Donald Trump.” Unvetted and unverified information by so-called informants somehow found its way into U.S. intelligence agency reports. These reports were then leaked to Democrat-friendly media. This is where the crime lies. Obama regime and DNC were using these agencies for domestic political use, KGB style.

    The Obama/Clinton cover story is now falling to pieces. That explains the desperation in the attack by Adam Schiff, the ranking Democrat on the House Intelligence Committee, on Committee Chairman Devin Nunes to stop the exposure. Russiagate is not a Trump/Putin collusion but a domestic spy job carried out by Democrats.

    Law requires Trump to arrest those responsible and to put them on trial for treason and conspiracy to overthrow the government of the United States. If Trump fears to prosecute the Obama operatives within the Deep State, they will try all the harder to attack him to the point of forcing his removal or at least discrediting him and his fellow Republicans to pave the way for the 2018 elections.

  • Susan Rice Responds To Trump Unmasking Allegations: "I Leaked Nothing To Nobody"

    If anyone expected former National Security Advisor Susan Rice, the same Susan Rice who “stretched the truth” about Benghazi, to admit in her first public appearance after news that she unmasked members of the Trump team to admit she did something wrong, will be disappointed. Instead, moments ago she told MSNBC’s Andrea Mitchell that she categorically denied that the Obama administration inappropriately spied on members of the Trump transition team.

    “The allegation is that somehow, Obama administration officials utilized intelligence for political purposes,” Rice told Mitchell. “That’s absolutely false…. My job is to protect the American people and the security of our country. ”

    “There was no such collection or surveillance on Trump Tower or Trump individuals, it is important to understand, directed by the White House or targeted at Trump individuals,” Rice said.

    //platform.twitter.com/widgets.js

    “I don’t solicit reports,” Rice said Tuesday. “They’re giving it to me, if I read it, and I think that in order for me to understand, is it significant or not so significant, I need to know who the ‘U.S. Person’ is, I can make that request.” She did concede that it is “possible” the Trump team was picked up in “incidental surveillance.”

    “The notion, which some people are trying to suggest, that by asking for the identity of the American person is the same is leaking it — that’s completely false,” Rice said. “There is no equivalence between so-called unmasking and leaking.”

    //platform.twitter.com/widgets.js

    That said, Rice did not discuss what motive she may have had behind what Bloomberg, Fox and others have confirmed, was her unmasking of members of the Trump team.

    Rice also flatly denied exposing President Trump’s former national security advisor Michael Flynn, who was forced to resign in February after media reports revealed that he misled Vice President Pence about the contents of a phone call with the Russian ambassador. Asked by Mitchell if she seeked to unmask the names of people involved in the Trump campaign in order to spy on them, Rice says: “absolutely not, for any political purpose, to spy, expose, anything.” And yet, that is what happened. She was then asked if she leaked if she leaked the name of Mike Flynn: “I leaked nothing to nobody.”

    //platform.twitter.com/widgets.js

    In a follow up question, Rice said that when it comes to Mike Flynn with whom she had “civil and cordial relations”, that she learned “in the press” that he was an unregistered agent for the Turkish government.

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    We doubt that anyone’s opinion will change after hearing the above especially considering that, in addition to Benghazi,  Rice is the official who praised Bowe Bergdahl for his “honorable service” and claimed he was captured “on the battlefield”, and then just two weeks ago, she told PBS that she didn’t know anything about the unmasking.

    Unfortunately, Mitchell’s list of questions did not go so far as to ask about her false claim in the PBS interview, in which she said “I know nothing about unmasking Trump officials.”

    It is thus hardly surprising that now that her memory has been “refreshed” about her role in the unmasking, that Rice clearly remembers doing nothing at all wrong.

    On Monday night, Rand Paul and other Republicans called for Rice to testify under oath, a request she sidestepped on Tuesday. “Let’s see what comes,” she told Mitchell, when asked if she would testify on the matter. “I’m not going to sit here and prejudge.”

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Apr 04

Today’s News 4th April 2017

  • Mass Exodus: 1 Million People Have Ditched New York Since 2010

    The folks of New York City seem to be slowly waking up to the fact that there are a whole lot of places to live in between America’s two shores that cost a lot less money, enjoy much better weather and don’t tax their citizens to death.  According to the latest data from the United States Census Bureau, the New York area has lost a total of nearly 1 million residents to domestic migration in just the past 6 years alone.

    Of course, if you listen to the Empire Center for Public Policy research, the mass exodus isn’t related to the Big Apple’s excessive cost of living or ridiculous tax structure but rather is just a symptom of the improving economy.  Per the New York Post:

    The number of people leaving the region — which includes parts of New Jersey, Connecticut, the lower Hudson Valley and Long Island — in one year swelled from 187,034 in 2015 to 223,423 in 2016, while the number of international immigrants settling in the tristate area dwindled from 181,551 to 160,324 over the same period, records show.

     

    The nation’s economy is improving, there are more jobs in cheaper places to live, and retirees are choosing to move to warmer climates, experts say.

     

    “The historical trend is that out-migration grows when the economy is getting better,” said Empire Center for Public Policy research director E.J. McMahon.

     

    “As the economy gets better, there are more jobs outside the region and by the same token . . . more people to buy your house if you’re a baby boomer looking to move to Boca Raton or Myrtle Beach.”

    Not surprisingly, Chicago saw the 2nd highest outflow of people followed closely by Los Angeles. 

    Moreover, in another ‘complete shock’, the people ditching NYC, Chicago and LA in record numbers are flocking to Texas and Arizona where they can enjoy sunshine 350 days a year, cheap housing and substantially lower tax rates. 

    Manhattan

     

    And while San Francisco hasn’t shown up on the ‘biggest loser’ list just yet, as we reported last week, a growing number of snowflake millennials are saying they can no longer stand to live in the preeminent American ‘safe space’ because the “rent is too damn high”, the traffic is too damn congested and, well, President Trump.  According to a new poll conducted by the Bay Area Council, 40% of all people living in San Francisco say they’re ready to ditch the city for greener pastures while the number is even higher among millennials at 46%.

    A growing number of Bay Area residents, led by millennials (18-39), are looking to greener (or less expensive) pastures as the region’s housing and traffic crises combined with an astronomical cost of living take their toll, according to results of the 2017 Bay Area Council Poll released today. The poll found that 40 percent of respondents are considering leaving the Bay Area in the next few years, with millennials leading the way at 46 percent, along with those who spend the biggest share of their income on housing.

     

    “Losing our youth is a very bad economic and social strategy,” said Jim Wunderman, President and CEO of the Bay Area Council. “But until we get serious about building the housing we need we’re going to continue seeing our region drained of the young and diverse talent that has helped make the Bay Area an economic powerhouse. We know what the solutions are – streamline local approval and reduce fees and regulatory costs – we just need the political will here and in Sacramento to make them happen. It can be done, it must be done and we’re working now to get it done.”

    Meanwhile, the number of people saying they’re looking to ditch the city jumped 6 points versus 2016.

    San Fran

     

    Of course, housing and traffic were the most cited reasons that people were looking leave San Fran.  But, in a rather surprising new addition to the list of complaints, President Trump also showed up as a key threat to life in the Bay Area.  Perhaps, the snowflakes of California’s northern shores aren’t aware that even if they move elsewhere in the country that President Trump would still be their president?

    San Fran

    Guess spending $1.2 million on those 600 square foot studio apartments gets old after a while…

  • China Starts 2017 With Highest Number Of Corporate Defaults In History

    Back in October 2015, roughly around the bottom of the recent commodity cycle, we reported a stunning statistic: more than half of Chinese companies did not generate enough cash flow to even cover the interest on their cash flow, and as we concluded “it is safe to assume that up to two-third of Chinese commodity companies are now at imminent danger of default, as they can’t even generate the cash to pay down the interest on their debt, let alone fund repayments.“

    While commodity prices have staged a powerful bounce over the past 18 months, and despite the government’s powerful drive to avoid major defaults over concerns about resulting mass unemployment, the inevitable default wave has finally arrived, and as Bloomberg reports overnight, “China’s deleveraging push has racked up the most defaults on corporate bonds ever for a first quarter, and the identity of the debtors is pretty revealing.”

    Seven companies have defaulted on a total of nine bonds onshore so far in 2017, versus 29 for all of last year, according to data compiled by Bloomberg. In a sign of the struggles facing China’s old economic model, most of them depend on heavy industry and construction. While it’s still far from a crisis point, the defaults shows how policy makers’ efforts to reduce the liquidity that had propelled the bond market until late last year is exacting casualties.

    Cited by Bloomberg, Liu Dongliang, a senior analyst at China Merchants Bank Co. in Shenzhen said that “weak companies can’t sell bonds, which adds to the pressure on their cash flow.” As a result, “the pace of defaults will continue. It will be even more difficult for weak companies to sell bonds because corporate bond yields may rise further — the current yield premium doesn’t provide enough protection against credit risks.”

    As discussed in recent months, the Chinese central bank has been curbing leverage in money markets leading to a spike in borrowing costs…

    … which has also hit issuance: making rolling over of existing debt prohibitive for many. Firms rated AA, generally considered junk in China, sold 33 billion yuan ($4.8 billion) of bonds in the first quarter, the least since 2011, Bloomberg data show. Chinese companies have scrapped 129 billion yuan of bond sales since Dec. 31, a jump of more than 50 percent from the same period a year before.

    Continuing the deleveraging push, and further tightening financial conditions, over the weekend, the PBOC boosted rates on loans aimed at small- and medium-sized financial institutions while as reported last weekend, smaller and mid-size banks have been caught in the cross hairs of shadow banking deleveraging, with some said to have missed debt payments in March.

    Not surprisingly, Bloomberg reports that four of this year’s nine defaulted bonds were issued by companies based in the northeast rust-belt province of Liaoning, which has been among the areas hit hardest by China’s focus on reducing capacity in industries such as steel and coal. Another key Chinese commodity producing province, Hebei, which is the nexus of China’s steel-production has so far been spared as a result of lying about its production cuts, however recent revelations have prompted Beijing to crack down on local factories, resulting in the recent decline in iron-ore prices, which will likely have adverse impacts on Chinese upstream steel suppliers, and result in even more defaults in the coming months.

    Courtesy of Bloomberg, here is a summary of the companies that have defaulted so far in 2017:

    1. Dalian Machine Tool Group Corp.

    The top perpetrator, this Liaoning manufacturer defaulted on three bonds this year, after issuing new securities as recently as October. The tool making industry has a large number of players, and is ripe for consolidation, according to Bloomberg Intelligence. Dalian Machine is also based in a province that tumbled into an outright recession last year. The securities involved include a note due in May 2017, one due in July and another due in January 2019.

    2. Dongbei Special Steel Group Co.

    This steelmaker based in Dalian, a port city on the Yellow Sea, is a good example of Liaoning’s troubles. The company, partially state owned, was already bailed out in the early 2000s before it had to grapple with the challenges of China’s economy decelerating from around 10 percent growth to sub-7 percent. It’s now defaulted on its sixth bond since its latest financial difficulties began a year ago. The company is in bankruptcy proceedings. The note defaulted on was originally issued in 2013 and is due in January 2018.

    3. Inner Mongolia Berun Group Co.

    This investment company is based in the heart of the northern province of Inner Mongolia, which saw a surge in construction during the record credit boom unleashed during the global financial crisis. Berun Group’s home city, Ordos, was dubbed China’s biggest “ghost town,” for all the vacant buildings that went up during the stimulus period. This was the second default within two months for the company, which invests in chemicals and logistics. The defaulted security was a note issued last year that was due in January.

    4. China Shanshui Cement Group Ltd.

    While this company is based in Shandong, a province southeast of Beijing that’s better off than its neighbor across the Yellow Sea, Liaoning, cement has become a tougher industry since regulators took steps to rein in China’s property sector. China Shanshui Cement Group has defaulted on several bonds since November 2015 after a boardroom fracas stymied financing. Its Hong Kong-traded shares are suspended. The bond in question was three-year note issued in February 2014.

    5. China City Construction Holding Group Co.

    This builder is based in the national capital, but Beijing’s ongoing property boom wasn’t enough to prevent it from missing interest payments. A change in the contractor’s ownership last April triggered early redemption of a Dim Sum bond, and then China City faced difficulties transferring funds offshore to repay the debt. The shifting shareholder structure has had a “serious” negative impact on the company’s ongoing ability to secure funding, according to China Lianhe Credit Rating Co. The company defaulted again early last month. The security was a bond due in March 2021.

    6. Huasheng Jiangquan Group Co.

    Another Shandong-based company, this steelmaker suffered “huge losses” after its subsidiary cut manufacturing of the alloy, according to Dongxing Securities Co., the lead underwriter on the defaulted bond. Premier Li Keqiang said in his address to the National People’s Congress last month that China wants to reduce steel capacity by about 50 million tons. Huasheng Jiangquan repaid the overdue amount on the debt March 22. The 800 million-yuan bond that was defaulted on was due in March 2019.

    7. Zhuhai Zhongfu Enterprise Co.

    A bottle maker for Coca-Cola Co., this company sticks out because it hails from Guangdong, China’s powerhouse exporter province. Zhuhai Zhongfu said in a statement last week that it’s running at a loss amid competition in the industry and weak demand. The company’s controlling shareholder says Zhuhai Zhongfu is planning to make an overdue payment by April 26 on the bond that it defaulted on March 28. The firm defaulted on a separate bond in 2015 and repaid the debt five months later.

  • Are 401K Holders About To Feel A Savers Pain?

    Authored by Mark St.Cyr,

    There’s an old truism people forget all too often. It has many variations and is attributed to even more, its core meaning goes something like this:

    “If the government can give it to you, than it can also take it away.”

    Some of you might be wondering if I’m talking about the current “tax” advantages that have made these vehicles so popular over the years. To that I’ll say no, not at this current time. But I feel that will be the least of worries coming down the pike in the not so distant future.

    No, what I’m directly addressing is what is now emanating from the one and only non-government, privately held institution, directed by a consortium of non-elected, Ivory Towered, policy wonks: The Federal Reserve.

    And those emanations are anything but 401K holder friendly. Let me explain…

    I know many are wondering how a government inspired quote, a private institution, their retirement account, or savings account fits under one banner, or are some how all connected. Well, that’s easy:

    The Federal Reserve has been the sole entity that dictates what any of them are currently worth. And if you don’t like their choices or decisions? Tough. There’s nothing you can do about it. Period.

    Maybe that’s not quite correct: It’s not that there’s “nothing you can do.” The problem is – there’s nothing you’ll want to do. Hence where the real issues lie.

    The following is for those who know of no other “investing” world (or 401K holder) other than after the financial crisis of 2007/08. Or put differently – if you’ve been working and saving only for the last decade or so. i.e., in the 35ish – 40-year-old bracket and younger.

    Back in ancient history before algorithmic HFT parasites roamed the trading world (circa 2008 A.D.) One could retire comfortably with a modest sum of money and find relatively safe places to hold their assets receiving some form of interest payment for its usage. CD’s (certificates of deposit) bonds (such as U.S. Treasuries) and others were some of the most popular.

    That was until the Fed. decided interest rates and everything that was connected to them was secondary (and even expendable) as to subjugate the financial markets and bring them into such a reflexive corollary that even if a Fed. official whispered- the effect on Wall Street was a realtime example of that other adage “When a butterfly flaps its wings…”

    That’s what pumping (and printing) $4+TRILLION dollars via differing iterations of QE, Twist and a relentless death grip for years at the Zero-bound will buy you.

    For those who don’t remember, it used to be when understanding investing prowess people used to say (or was advertised) things like, “When E.F. Hutton speaks – people listen.” Now it’s: “When The Federal Reserve whispers – Wall Street jumps!”

    That’s what the greatest expression for capital formation the world has ever known has now become. i.e., Nothing more than a trained jumping flea circus. And again – all in less than 10 years.

    Does a “Mission Accomplished” banner come with that? But I digress.

    One of the reasons I can attest to much of what has been thrust upon (or taken from) retirees and others is that I actually am one, became one right at the beginning of the financial crisis. I was fortunate enough (via hard work and forethought) as to retire at the age of 45. A “dream” or ‘brass ring” many find elusive if not near impossible back in 2005.

    It was a dream come true. However – it was also smack-dab right before, and squarely into the teeth of the “out of the blue” financial shock and market melt down for the ages that would transform everything. And I do mean: everything!

    Suddenly the idea of diversifying one’s financial assets into relative safety was gone – and I do mean just that – gone. Which is, by-the-way, why I detest and so adamantly stand against all this over-simplified drivel once again appearing from so-called financial “expert” landscape. It’s going to hurt far more people than it’ll ever help.

    The Federal Reserve decided in its infinite “wisdom” that interest rates were now to be considered a “poison” to the economy and not only cut – but slashed them, and held them at the Zero-bound for years. What this meant was one could no longer expect to receive any interest bearing accounts to live. i.e., Eat, pay bills, et cetera. And I won’t even get into what it has done to pensions and insurance companies.

    But no one has cared – especially the Fed. Let me use the following for demonstration purposes…

    Let’s say you were an entrepreneur and sold your business, or were able to some how via thrift or shrewd business acumen, and were able to amass a nest egg of let’s say $3Million dollars for the entrepreneur, and $1Million for the shrewd. Both scenarios are quite feasible for the prudent minded.

    Just 10 years ago it was also not only feasible, but rather probable, one could safely allocate their resources finding returns of 5% (and higher, depending) in such mundane vehicles as CD’s, Treasuries, and more.

    So, using nothing more than napkin math, one could easily calculate using the $1MM example that money would generate approximately $50,000.00 per year without touching the principal for one to live on. This was also a relatively accurate proposition because there was precedent going back decades. Sure, $50K ain’t what it used to be, but it’s sure a hell of a lot more than Zero – which is precisely what interest rates have been now going on years. And on $3MM? It’s the same. i.e. Zero, as in zip, zero, nada.

    “But wait! There’s more!!!” as they say, but it’s not a bonus anyone wants to hear about. What is that you say? Glad you asked…

    Not only does having a $Million dollars get you nothing at a bank (correct, not even a lousy toaster) if you are one of the fortunate (or unfortunate depending on perspective) who wants to put that hard-earned money safely under “lock and key” via the auspices of some bank – it’s going to cost you! And in some instances – they might not even want your deposit at all. Why?

    Why else – it’ll cost them, and that’s a no-no in banking. Costs are something you pay – not them. And if enough profits can’t be made on legitimate transactions? See Wells Fargo™ for clues.

    So what was the flip side? Here’s my opinion…

    Welcome to the “markets” (or should I say casino) of today. Where 401K holders, and corporate buy-backs supported via the Fed’s balance sheet accrual, and zero interest rate financing meet the front running, algorithmic, headline reading HFT parasites which enabled the BTFD phenom to appear time, after time, after time, after time. Which, by its very nature and existence has allowed “investing” to be the equivalent of nothing more than following the strategy of a chimp hurling darts at ETF symbols backed by a central banks “bulls-eye.”

    Ah, but what a difference an election does make, no? For that was then – and this is now. And “now” seems to be that the Federal Reserve is hell-bent as to raise interest rates regardless of what the “markets” desire.

    Can you say, “Oh-oh?”

    For years the cries of savers, pension plans, insurance companies and more have fallen on deaf ears. Actuary tables that prove these bedrocks of society can not sustain or endure under a Fed. policy such as what has been thrust upon them was relegated to the, “Who cares the “markets” up – deal with it!” status.

    Now – That all seems to have changed.

    Suddenly (as in the last few months) interest rates not only need to go up. They need to go up stat!

    The Fed. via its differing speakers in public comments are signaling that not only is the raising of rates further, and quicker on the table, but so too is the balance sheet as to begin down sizing it.

    If the above is to be taken at face value (and why shouldn’t it, after all, isn’t this why the Fed. makes public comments to begin with?) with signaling (via the Dot Plot and more) now stating 3 rate hikes for 2017 and some Fed. speakers signaling the possibility of even 4. Along with the abrupt metamorphosis of doves turning into hawks (using Ms. Yellen, and Ms. Brainard as examples) the “markets” are going to find fuel to propel them higher using what precisely?

    The only fuel that has enabled the “markets” to propel this high has been all Fed. funded. And now this same Fed. is in no uncertain terms professing they’re out of the “hopium” business. Or at least – want to appear that way.

    If this is true, taking them not just at their words, but rather via their actions – we now have 2 rate increases in 90 days with near shouting (as compared to prior discussions) that the Fed. is far more interested in raising further, and faster, than previously discussed. All while remembering it was only a few short weeks prior the Fed. Chair herself was touting the need for running a “high pressure economy” and has now flipped to jettison anything of the such – and is now the undisputed leader of “hawks are us.”

    The issue here is – the “markets” have been levitated via the “wings of doves.” Suddenly – those “doves” have all but vanished. And if that’s true? What’s vanished with it may just be the BTFD genius along with it. And that will turn into a very big problem indeed if correct.

    When savers were (and still are) getting crushed, no one cared, not even the Fed. The problem?

    It seems just as the Fed. turned its back on savers pain all these years – they might be signaling how they’re going to feel about any 401K holders losses that may appear via their new-found policy stance. To Wit:

    ZeroHedge: “What is the biggest S&P drop the Fed will accept before intervening?”

    Minneapolis Fed. president Neel Kashkari: “Don’t care about stock market fall itself. Care abt potential financial instability. Stock market drop unlikely to trigger crisis.”

    And with that, only one last saying comes to my mind:

    Dear 401K holders – welcome to a savers world. Oh yeah, and buckle up. For things might get a little “bumpy” as that other saying goes.

  • "Hot Money": Hong Kong Businessman Pays $2.5 Million For 18-Year-Old Romanian Model's Virginity

    There is so much excess liquidity in China that an 18-year-old Romanian model has agreed to sell her virginity to a “very friendly” – and generous – Hong Kong businessman for the “life-changing” sum of $2.45 million (€ 2.3 million).

    In late 2016, Romanian Alexandra Kefren ignited a firestorm of outrage after it was reported that she had put her first sexual experience up for auction for a minimum of $1 million on Cinderella Escorts, a Germany-based agency which specializes in teens looking to sell their virginity online. According to the Shanghaiist, Kefren says she got the idea from watching Indecent Proposal when she was 15 years old.

    After the news made headlines around the world, Kefren’s parents nearly disowned her. She later went on a British daytime television show to explain her decision. The teen said that she was selling her virginity so that she could pay for a good life for her parents, as well as a home and education for herself.

    With the YouTube clip alone getting nearly 2 million views (unclear if it ran Coke ads), the surge in media attention caused the bids to skyrocket. Finally, an anonymous Hong Kong businessman offered $2.45 million for the privilege of lifting her, well, offer. It was an amount she could not say no to.

    On Cinderella Escorts, Kefren explained her decision last month, asking “How many would possibly forgo their first time in retrospect if they could have 2.3 million euros instead?”

    I am glad to have decided to sell my virginity throught Cinderella Escorts, I would never have dreamed that the bid would go so high and we would reach € 2.3 million. This is really a dream come true.

     

    We had commandments from all over the world and there was a long process. I was criticized in the press.

     

    It was felt as a taboo that I can do with my body what I want.

     

    But I have kept to it that I wanted to sell my virginity with Cinderella Escorts rather than giving it to a future friend who might have left me anyway. And I think many other girls have the same attitude.

     

    How many would possibly forgo their first time in retrospect if they could have 2.3 million euros instead? Everyone has to ask himself this question. Of course, there will be different opinions, but everyone should be able to represent and live their own.

     

    Now everything has to be organized. The hotel is booked. Cinderella Escorts accompanies me to the meeting and stays nearby as security if problems arise. I have the possibility to terminate the meeting at any time, but I am quite confident. I could talk with the buyer before and we are very friendly.

    But while Kefren may have hit the jackpot, if only once, the biggest recurring winner in the arrangement appears to be the agency, Cinderella Escorts, which will profit on this deal, taking a 20% commission from the transaction. Additionally, Kefren’s story appears to have inspired more girls to follow in her footsteps. The agency claims that they have received requests from 300 girls from around the country wanting to sell their virginity on the site as well.

    As for Hong Kong and Chinese bidders, we are confident that they will soon figure out a novel way of converting this scheme into the latest and greatest way to funnel hot money out of China’s closed financial system and into more mature market. Curious where to “park” several million in “hot money”?  Then head on over to the money laundering, pardon, virginity auction website.

  • Tucker Carlson: 'Our Laws Provide No Serious Protection From Being Spied Upon for Political Reasons'

    Tucker Carlson tackled the subject of Susan Rice and privacy this evening — drawing a red line in the sand — proclaiming that ‘our laws provided no serious protections from being spied on for political reasons.’

    Can anyone make an argument proving this to be a false statement?

    All too often, lazy thinkers conclude that it is the right of government to spy on its citizens. Perhaps that is the case in Saudi Arabia or Canada, but it’s not supposed to be that way here. Either the promotional propaganda that lauds America’s democracy as being the ideal for representative forms of government are true or they aren’t. Providing the latter prevails, as it is now, no one will ever believe in the dream that was democracy — thanks to a cadre of corrupt mountebanks who’ve abused the goodwill of the American people and its systems for purposes of self-aggrandizement and a prevailing bias that wantonly eschews the liberty of its citizens — superseded only by a craven and insatiable appetite for power.

     

    Content originally published at iBankCoin.com

  • Trump & The Candlemakers' Petition

    Authored by Jeff Thomas via InterernationalMan.com,

    French economist Frédéric Bastiat was a man far ahead of his time. He was a “classical liberal,” which today would identify him as a libertarian. He expanded upon the free-market argument set forth by Adam Smith in 1776.

    In 1845, the French government levied protective tariffs on scores of items, from sewing needles to locomotives. The intent was to protect French industries from companies outside France that could produce the goods more cheaply.

    The reaction from Mister Bastiat was to publish “The Candlemakers’ Petition,” a satirical proposal to the government that was intended to help them see the nonsense of protective tariffs.

    The petition was presented as having been sent by “the Manufacturers of Candles, Tapers, Lanterns, Sticks, Street Lamps, Snuffers, and Extinguishers, and from Producers of Tallow, Oil, Resin, Alcohol, and Generally of Everything Connected with Lighting.”  

    Their plea to the Chamber of Deputies was that the government pass a law “requiring the closing of all windows, dormers, skylights, inside and outside shutters, curtains, casements, bull’s-eyes, deadlights, and blinds—in short, all openings, holes, chinks, and fissures through which the light of the sun is wont to enter houses.”

    Mister Bastiat’s satirical petition did an exemplary job of exposing the tendency of governments to pander to special interest groups to the detriment of everyone else.

    Throughout the ages, protective tariffs have been created for this purpose and, historically, they work only briefly, if at all.

    In 1930, the US introduced the Smoot-Hawley Tariff Act, which raised tariffs on over 20,000 imported goods. Not surprisingly, the source countries for those goods retaliated by passing their own tariffs against the importation of American goods.

    The net effect, in addition to the new laws cancelling each other out, was that free trade took a major hit. Consumers in all countries affected had less access to a variety of goods, and the GDP of each nation suffered as overseas orders dried up.

    Of course, the justification for Smoot-Hawley was that the US had suffered a stock market crash and the demand to protect surviving businesses was considerable. It’s not surprising, then, that whenever a given country finds itself in an economic squeeze, industry leaders shout “foul!” and governments appease them with tariffs.

    Again, not surprisingly, we observe the tariff question rearing its ugly head today, most visibly in the US, where new President Donald Trump has vowed to place tariffs on a number of countries, most notably on Mexico (20%) and China (a whopping 45%).

    As is always the case when a government declares it will create a dramatic tariff, those who impose it look no further than the immediate effect—that of limiting importing goods to protect domestic industry. The immediate secondary effect is that goods from those countries suddenly become far more expensive, and domestic industry is either unable to produce the goods at all, or at best, it must do so at a much higher price.

    At present, Chinese goods amount to 19% of American imports and Mexican goods amount to 12%. With nearly a third of all goods purchased by Americans during a difficult economic period increasing dramatically in price, the impact to the cost of living can be expected to be substantial. If the tariffs are extended to other jurisdictions, as in 1930, a few domestic industries would enjoy a brief period of benefit, but the population (and eventually all industry, through knock-on effects) would be heavily impacted.

    So, why on earth are political leaders so quick to impose tariffs? Well, don’t forget: Tariffs are paid to the government. Any government that’s facing revenue problems will be tempted to go for a quick injection of revenue, even if it will ultimately be destructive. Regardless of how much damage tariffs do to the people of a country, tariff revenue is like manna from heaven for governments.

    Of course, the revenue source tends to dry up before long as, ultimately, tariffs are destructive to free trade. Most tariffs are either abolished or at least lowered at some point. In the meantime, they’re like plaque in a body’s arteries, creating a sclerotic effect on the economy. Invariably, they’re a heavy price for a country to pay for a brief period of additional revenue that political leaders may squander.

    But, understandably, the temptation is great for any government and, since memories tend to be short, governments can serially con the public into another round of protectionism every generation or so.

    Returning once again to Mister Bastiat’s satirical petition, his final paragraph stated,

    Make your choice, but be logical; for as long as you ban, as you do, foreign coal, iron, wheat, and textiles, in proportion as their price approaches zero, how inconsistent it would be to admit the light of the sun, whose price is zero all day long!

    On the surface, tariffs sound like a good idea, but in reality, they’re veritable icebergs of economic destruction. Two principles should always be considered when musing on a tariff:

    1. Tariffs (protectionism) never benefit a nation. They do, however, often increase the revenue received by the imposing government.

    2. The more a people pay for products, the lower their standard of living.

    It’s hard to overstate how much US consumers rely on cheap goods from countries like China and Mexico. But even without the Trump tariffs, many can already feel their once nice standard of living slipping away.

    That’s because the US is on the cusp of an unprecedented economic storm—and we’re already feeling the raindrops.

    *  *  *

    New York Times best-selling author Doug Casey and his team put together this groundbreaking video showing you how to build a financial shelter to protect yourself and your family. Click here to watch it now.

  • Dallas Mayor Pulls Support For "Massive Taxpayer Bailout" Of Police Pension

    Dallas Mayor Mike Rawlings has finally reached his maximum willingness to throw taxpayer dollars at the Dallas Police and Fire Pension (DPFP) system and has pulled is support for a bill that, if it passes, will undoubtedly prove to be yet another futile effort to save the system from insolvency.  Despite support for the original legislation introduced by Dan Flynn, chair of the pensions committee in the Texas House of Representatives, Rawlings apparently took issue with a last minute addition to the bill that would have taxpayers fund the pensions of “phantom employees” based on a target Dallas police force of 3 officers per 1,000 residents.  Per ABC:

    The clause sets a baseline number of officers and firefighters. In the case of police, that’s three officers per thousand. The clause would also automatically assume that a certain level of raises given.

     

    “Basically you’re paying on phantom employees, not real employees,” Rawlings said. “We just can’t enter into an agreement with that degree of commitment for the city. No business would do it this way. We cannot find another pension fund in American where someone pays into a fund based on future employees. It’s just not done and it should not start here in the State of Texas.”

     

    “This is the most taxpayer unfriendly poison pill that I’ve seen in this bill,” he said. “I’m not going to swallow this pill.”

    Frankly, not wanting to spend taxpayer dollars to fund the pensions of officers that don’t even exist just seems selfish, Mike!

    As we reported previously (see “Dallas Police Pension Board Approves Benefit Cuts; Asks For More Taxpayer Money To Avoid Collapse“), legislation to save the DPFP was introduced a couple of months ago by Dan Flynn.  Flynn’s bill called for Dallas taxpayers to contribute 34.5% of police and firefighter salaries each year into the failing pension system, up from 27% in 2015, plus an incremental $11 million per year.  In total, the adopted plan was expected to cost Dallas taxpayers an extra $22 million per year.

    That said, the plan also called for pensioners to grant concessions, including the following:

    • Increase in retirement age to 58 from 55
    • Increase in employee contributions to 13.5% of payroll from 8.5%
    • Elimination of COLAs in the near term
    • Elimination of exorbitant interest payments made on employees DROP accounts

    Of course, Flynn was appalled by Rawling’s opposition to funding the pensions of fake employees and took to twitter to blast his decision.

     “I am deeply disappointed that the Mayor is not in support of the Legislation that will save the Dallas Police and Fire Pension.  Dallas’s own website says how much they are committed to provide and now they back out over a provision that has always been in the bill since the day it was filed and want to hurt families more. I simply won’t allow it. 10,000 Police and Fire retirees and active members and their extended families will be damaged by this stance and we hope the Mayor thinks better of it.”

    //platform.twitter.com/widgets.js

     

    Meanwhile, Rawlings also expressed opposition to the current governance set out in the bill as it gives 50% control to the city and 50% to public safety workers.

    “The thing that’s really concerning to me is that retirees say Dallas promised us this money, ‘give it to us,’” he said. “Dallas didn’t promise the money and if you want us to own the problem,… Dallas needs to have the right governance to do that.”

     

    He noted that when he first became mayor in 2011, he sought to have the pension fund audited in the face of questions about the financial stability of the fund.

     

    “They said you have no legal authority to do that,” he said.

     

    The mayor and the city’s position is that police and firefighters voted themselves excessively generous benefits, and that the fund’s leadership hid the extent of the fund’s troubles from the membership for years.

    But don’t worry dear pensioners, we’re sure you’ll end up getting your taxpayer funded bailout…after all, there is no problem too large for taxpayers to solve.

    * * *

    For those who aren’t familiar with the DPFP fiasco, here is some background on how it ended up in its current predicament.

    Just over a month ago we wrote that the Dallas Police and Fire Pension Fund was on the verge of collapse after a series of shady real estate investments resulted in massive markdowns of pension assets, the ouster of the fund’s CIO and an FBI raid of the fund’s largest real estate investment manager (see “Dallas Cops’ Pension Fund Nears Insolvency In Wake Of Shady Real Estate Deals, FBI Raid“).  We summed up the fund’s dilemma as follows:  

    The Dallas Police & Fire Pension (DPFP), which covers nearly 10,000 police and firefighters, is on the verge of collapse as its board and the City of Dallas struggle to pitch benefit cuts to save the plan from complete failure.  According the the National Real Estate Investor, DPFP was once applauded for it’s “diverse investment portfolio” but turns out it may have all been a fraud as the pension’s former real estate investment manager, CDK Realy Advisors, was raided by the FBI in April 2016 and the fund was subsequently forced to mark down their entire real estate book by 32%.  Guess it’s pretty easy to generate good returns if you manage a book of illiquid assets that can be marked at your “discretion”. 

    The rampant fraud at the DPFP left the fund over $3BN underfunded and its board of directors with no other option but to seek a $600mm infusion from taxpayers to keep the fund afloat.  Even worse, a review of the pension’s financials revealed $2.11 of annual benefit payments to members for every $1.00 contributed to the plan by members and taxpayers (mostly taxpayers)…the typical pension ponzi whereby plan administrators borrow from assets reserved to cover future liabilities (which are likely impaired) to cover current claims in full.

    DPFP

     

    Well, it seems as though Dallas police officers are catching on to the ponzi and rushing to withdraw retirement funds as quickly as possible before the whole system goes bust.  As reported by a local ABC affiliate, Dallas police officers are retiring at a record rate and opting for full cash withdrawals of their pension benefits as opposed to equal monthly distributions for life (apparently they don’t think the fund will be around long enough to pay them for very long).

    But the pension fund is in trouble and in danger of going bankrupt. That’s causing some officers and retirees to begin withdrawing their retirement funds and rolling it into their 401Ks.

     

    News 8 has learned a that one assistant chief recently withdrew more than $1 million, and sources say nearly $300 million has been withdrawn throughout the department.

     

    “We are in a serious situation and I think everyone needs to be concerned right now about where we are and where we need to go to get out of this.”

    DPFP board chairman, Sam Friar, was apparently worried enough about the “run on the bank” exposing the pension for the ponzi scheme that it is, that he decided to send a letter to members urging them to “not act rashly and without full information.”  The pension board also voted to stop allowing current police officers to withdraw the cash value of their pensions and are considering further measures that would also restrict withdrawals by retirees. 

    The panic that has set in forced the chairman of the pension board Sam Friar to issue a letter to members.

     

    “I would strongly urge all members not to act rashly and without full information,” he wrote. “You may make decisions that, after all the changes are made, are not in your best interest.”

     

    The board was so concerned it voted to stop current officers from withdrawing any money from their pensions, and sources say the board will soon vote to no longer allow retirees to take their money out.

     

    “This may be the only way the pension can limit the cash outflow because we are in a bad situation that right now the existence of system is at stake.”

    Alas, the threats to restrict withdrawals of retirees probably didn’t work out the way Friar expected as it has set off a wave of early retirements.  According to NBC, for the first two weeks of September, 21 Dallas police officers retired when only 14 retirements were expected for all of August and September. 

    Through the first two weeks of September, there have been 21 Dallas police officers who retired.

     

    Multiple sources told NBC 5 that commanders are bracing for many more retirements over the next two weeks as well.

     

    The Dallas Police Department did not foresee the volume of retirements this month.

     

    In early August, Deputy Chiefs told city council members in a presentation that they projected 14 retirements between Aug. 9 and Oct. 1.

    Alas, while Dallas police and fire fighters may endure some short-term pain, as their pension ponzi is revealed for all to see, we suspect that the real losers, as per the usual, will be taxpayers who will ultimately be forced to pony up whatever amount of money is required to keep the whole farce going just a little longer.

    http://www.nbcdfw.com/portableplayer/?cmsID=393783421&videoID=4eEECeS42VOa&origin=nbcdfw.com&sec=news&subsec=local&width=600&height=360

  • Rand Paul: Rice Should Testify Under Oath If Obama Ordered Her To "Unmask" Trump Team

    After it emerged courtesy of Mike Cernovich that former National Security Advisor Susan Rice had made numerous requests to “unmask” the identities of Americans associated with President Trump in intelligence reports, senator Rand Paul who in recent days has been on increasingly better terms with the president and even went golfing with him this weekend, said Rice should testify under oath about her involvment in a potentially illegal scandal that she herself denied she had any knowledge of as recently as 2 weeks ago.

    The Kentucky senator called the unmasking an “enormous deal” and indicated that it should be illegal.

    “If it is allowed, we shouldn’t be allowing it, but I don’t think should just discount how big a deal it is that Susan Rice was looking at these and she needs to be asked, ‘Did President Obama ask her to do this? Was this a directive from President Obama?  I think she should testify under oath on this.” Paul told reporters.

    “I think she should be asked under oath, did she reveal it to The Washington Post. I think they were illegally basically using an espionage tool to eavesdrop or wiretap — if you want to use the word generally — on the Trump campaign,” Paul said.

    The report about Rice is linked to Devin Nunes’s claim that the Trump transition team was “accidentally surveilled” and associated information was widely disseminated in intelligence community reports.

    Nunes made the claim nearly two weeks ago, infuriating his Democratic colleagues by briefing the media and Trump on the information before revealing it to his committee. Nunes said he was particularly concerned with the possibility that Trump associates were “unmasked” in the intelligence reports.  Nunes revealed the information weeks after Trump accused Obama of having his “wires tapped” at Trump Tower ahead of the presidential election.

    Paul used Monday’s development to renew his push for reform of a controversial provision of the Foreign Intelligence Surveillance Act (FISA) that allows the U.S. intelligence community to target non-Americans outside the United States without a warrant. The provision, Section 702, is up for renewal later this year. Paul also signaled that he sees Nunes — who has long been an advocate for the foreign intelligence law — as a potential ally for reform.

    Nunes previously took issue with the fact that Michael Flynn, Trump’s former national security adviser, had his communications monitored by the intelligence community, which were later the subject of media reports. 

    “I have been very impressed with Devin Nunes,” Paul said. “All of the intelligence hawks don’t like him because he appears to have found something and he’s willing to talk about it with the president.”

    “I think it is inappropriate and it should be illegal,” Paul said of “incidental collection” on Americans without a warrant, i.e. spying by the NSA first revealed by Edward Snowden.

    “I don’t think you should be allowed to listen to Americans’ conversations without a warrant. They are doing it without a warrant. They are targeting a foreigner, and because they are targeting a foreigner they are gathering all of this information on Americans.” 

    “Is there a possibility that Susan Rice was politically motivated? Let’s ask her why she was opening up all of the conversations with Trump transition figures.”

    Last Friday, in a rare public compliment of a political figure, Matt Drudge said that “Rand Paul is America’s best senator.”

  • Cernovich Explains How He Learned About Susan Rice

    Ever since Mike Cernovich dropped the bombshell report over the weekend outing Obama’s National Security Advisor, Susan Rice, as the person behind the unmasking of the identity of various members of Trump’s team who were ‘incidentally’ surveilled during the 2016 campaign (see “Confirmed: Susan Rice “Unmasked” Trump Team“), a report which was subsequently confirmed by Eli Lake of Bloomberg earlier this morning, everyone has been wondering who within the Trump White House or the intelligence community supplied him with such a massive scoop. 

    But, as it turns out, Cernovich didn’t need a ‘deep throat’ within the NSA or CIA for his blockbuster scoop, all he needed was some well-placed sources inside of a couple of America’s corrupt mainstream media outlets.  As Cernovich explains below, his sources for the Susan Rice story were actually folks working at Bloomberg and the New York Times who revealed that both Eli Lake (Bloomberg) and Maggie Haberman (NYT) were sitting on the Susan Rice story in order to protect the Obama administration.

    “Maggie Haberman had it.  She will not run any articles that are critical of the Obama administration.”

     

    “Eli Lake had it.  He didn’t want to run it and Bloomberg didn’t want to run it because it vindicates Trump’s claim that he had been spied upon.  And Eli Lake is a ‘never Trumper.’  Bloomberg was a ‘never Trump’ publication.”

     

    “I’m showing you the politics of ‘real journalism’.  ‘Real journalism’ is that Bloomberg had it and the New York Times had it but they wouldn’t run it because  they don’t want to run any stories that would make Obama look bad or that will vindicate Trump.  They only want to run stories that make Trump look bad so that’s why they sat on it.”

     

    “So where did I get the story?  I didn’t get it from the intelligence community.  Everybody’s trying to figure out where I got it from.  I got it from somebody who works in one of those media companies.  I have spies in every media organization.  I got people in news rooms.  I got it from a source within the news room who said ‘Cernovich, they’re sitting on this story, they’re not going to run it, so you can run it’.”

     

    “If you’re at Bloomberg, I have people in there.  If you’re at the New York Times, I have people in there.  LA Times, Washington Post, you name it, I have my people in there.  I got IT people in every major news room in this country.  The IT people see every email so that’s how I knew it.”

     

    And while this could certainly be interpreted as a clever ploy to protect his real sources, Cernovich’s video comments seem to be validated by both his tweet from yesterday afternoon…

    //platform.twitter.com/widgets.js

    …and the fact that Eli Lake of Bloomberg was able to conveniently confirm Cernovich’s story with his own article this morning. 

    All of which just begs the question of what other stories the mainstream media is sitting on in an effort to protect their chosen candidates.

Digest powered by RSS Digest

Apr 03

Today’s News 3rd April 2017

  • Evidence Indicates French Government Coverup Of ISIS Involvement In Kardashian Paris Incident

    Via Disobedient Media

    The 2016 robbery of Kim Kardashian sent shockwaves around the globe and caused observers to question the efficiency of France’s state of emergency. However, the incident may have been more serious than authorities and the press have previously admitted. Research by Disobedient Media has revealed that the French government may be attempting to conceal the involvement of terror group ISIS in Kardashian’s robbery to prevent further public panic over the event.

    Conflicting facts given by sources to the media, analysis of the criminal group allegedly behind the attack given the known involvement of terror groups in organized crime, the French government’s apparent mishandling of the investigation into the robbery and reports that the proceeds from the heist made their way into the hands of jihadists all suggest that authorities may be seeking to conceal the involvement of terrorism in the incident.

    I. Timeline Of The Paris Incident

    The facts of Kardashian’s robbery are muddled and confused even months after the event occurred, but a basic timeline of events still can be constructed. On October 3rd, 2016, The Guardian and other outlets reported that a group of five armed assailants wearing masks and police armbands approached the Hotel Pourtales in Paris both on foot and riding bicycles. The group was captured on a CCTV security camera in a nearby nail salon as they came and went from the incident.

    CCTV footage showing one of the intruders donning a mask as he approaches the Hotel Pourtales on foot

    The men made their way into the hotel just a few minutes after 2:30 AM, where they restrained the hotel’s concierge. AP reported that they then took Kim Kardashian hostage in her hotel room, restraining her with zip ties and locking her in the bathroom. The celebrity oddly was alone and did not have any security present with her that night. Kardashian feared that she would be raped as she was held at gunpoint.

    Evidence indicates that Kardashian’s attackers may have originally intended to kidnap her. CCTV footage taken from a shoe shop near the Hotel Pourtales caught a black car with tinted windows passing by the hotel just four minutes after the attackers entered. It circled the block and passed by two additional times.

    The presence of a vehicle circling the block just minutes after a breach of the premises is a disturbing sign that the intruders were likely not only after Kardashian’s jewelry, but attempted to take her with them. An employee from the shoe shop where the camera was located stated that French police had spent more than 30 minutes viewing and analyzing the footage.

    CCTV footage showing a black car with tinted windows passing the Hotel Pourtales at 2:45 AM for the second time while the attack occurred

    It appears that after entering the Hotel Pourtales however, the intruders may have struck a hitch in their plans and had to exit the premises in haste. Reports have indicated that Kardashian’s stylist Simon Harouche was in a different room nearby Kardashian and apparently contacted members of her security detail to raise the alarm. The attackers left, taking a large amount of Kardashian’s jewelry worth over €10 million as well as a number of cell phones and €1,000 in cash. In their rush to escape the premises, the robbers dropped a jeweled cross outside the Hotel Pourtales which was found by a pedestrian several days after the attack and handed over the police.

    People Magazine reported that Kardashian was somehow able to subsequently free herself from the zip ties that had been used to restrain her and call for help. But Daily Mail has cast aspersions on this claim, pointing out that zip ties are designed to tighten, not loosen when moved. They can be broken if pulled apart with great force, but survival experts warn that trying to break free in this manner will likely cut ones wrists. Kardashian did not display any such injuries after the incident.

    In the United States, Kardashian’s husband Kanye West immediately walked off the stage of a show at the New York City festival The Meadows to rush to Paris and bring her home. On October 4th, 2016, Page Six reported that West suffered a nervous breakdown the day after the attack and fired 30 staffers from his Yeezus Season 4 fashion show. Media outlets blamed the incident on stress caused by a underperforming fashion show, totally ignoring the fact that West’s wife had been attacked just one day prior.

    On January 9th, 2017, multiple media outlets reported that French police had arrested 17 individuals in connection with the robbery, confiscating a number of firearms and more than €140,000 in cash. Daily Mail reported that the arrestees included the chauffeur who had been driving Kardashian around Paris the week of the incident.

    II. Misinformation About The Robbery, Conflicting Facts Were Promoted By French And American Media

    In the months following the Paris incident, the media engaged in a frenzy of reporting on the robbery, promoting a large amount of information which conflicts with government records and expert testimony.

    On October 27th, 2016, the concierge from the hotel, identified only by his first name, Abdulrahman, gave an interview to Entertainment Tonight where he claimed, among other things, that the attackers were looking primarily for cash instead of Kardashian’s jewelry. His statements directly contradict the contents of Kim Kardashian’s police report, which was obtained by Le Journal du Dimanche (an English version can be found here) where she stated that the robbers immediately asked her for her ring, and for her other jewelry immediately afterwards. She also told police that her phones had been stolen and that she could only be reached through her bodyguard. But video taken by an unknown individual in the hotel soon after police arrived shows Kardashian huddled on the couch using a cell phone. Radar Online published the video, asking where Kardashian obtained the phone from and citing security experts who wondered why there had been no cameras installed within her room for security per standard procedure. The online publication was forced to remove the video after legal threats from Kim Kardashian’s lawyers, raising questions about whether or not they were attempting to conceal evidence that she made false statements to the French police.

    Screengrab from the video obtained by Radar Online showing Kardashian using a cell phone after police arrived on the scene

    Though a number of the attackers appeared to approach the hotel on bicycles, several others did so on foot. Media outlets mentioned the CCTV footage which caught the attackers approaching the Hotel Pourtales, but only ran footage showing the assailants on bikes and omitted to mention the individuals who approached on foot in an apparent attempt to spin a false narrative about the incident. But CNN ran an interview with former jewel thief turned security consultant Larry Lawton and former Kardashian bodyguard Steve Stanulis where Lawton stated that it is common for robbers to move a few blocks before making their getaway in a van or truck. The notion that the attackers attempted to escape on foot and by bicycle does not seem consistent with what appeared to be a very thorough and well thought out operation.

    On February 20, 2017, the Mirror ran a bizarre article where they showed footage run by French TV broadcaster TF1 which they claimed showed “surveillance tape” footage of Kardashians attackers. However, the images were zoomed in, focused on the subjects and very clearly taken by an individual using a telephoto lens, rather than on CCTV or any other kind of surveillance camera. The broadcast appeared to be a strange attempt by the French media outlet to misrepresent information about the case.

    Image run by French broadcaster TF1 claiming to show “surveillance tape” footage of one of the attackers

    III. Evidence Indicating ISIS Involvement In Kardashian’s Robbery

    In February 2017, Disobedient Media published an analysis piece which referenced studies by the French anti-counterfeiting agency Union des Fabricants (UNIFAB) highlighting the growing involvement of ISIS in petty crime such as counterfeiting and The International Centre For The Study Of Radicalisation And Political Violence, who reported last year that “up to 40 per cent of terrorist plots in Europe are at least part-financed through ‘petty crime,’ especially drug-dealing, theft, robberies, the sale of counterfeit goods, loan fraud, and burglaries.” ISIS supporters have also penned and distributed guides teaching readers how to establish “Muslim gangs” in an effort to fuse organized crime and terror in Western Europe.

    On January 24th, 2017, Radar Online cited an official from Interpol who informed them that the stolen jewels had made their way into the hands of money launderers connected to jihadist groups, as well as a European official involved with tracking terror funding networks who said that the proceeds of the haul had gone to terror groups. Radar also spoke with David Levine, a professor at the University of California-Berkeley who stated that terror groups are commonly funded by the sale of black market gems. Hollywood tabloid Gossip Cop claimed that Radar’s article was false but offered no proof for this beyond citing “sources close to Kardashian.”

    On January 28th, 2017, Daily Mail reported that Aomar Ait Khedache, the alleged ringleader of Kardashian’s attackers, told French police that his team took the stolen jewelry to Antwerp, Belgium where they had it melted down and sold on the black market. The Financial Action Task Force has designated Belgium as one of several locations in Europe where organized crime funds terrorist groups.

    In the aftermath of the attack, The Sun reported that Kardashian majorly ramped up security, purchasing an armored car and hiring former members of the Secret Service, CIA and Israeli Special Forces. Daily Mail also reported that Kardashian was adding a $100,000 panic room to her home in Los Angeles. Ynet News reported that Aaron Cohen, one of Kardashian’s Israeli hires had been a member of Israel’s elite Duvdevan Unit. Cohen has trained soldiers around the world in fighting terrorism. The drastic security increases and employment of individuals with explicit counter-terror backgrounds suggests that Kardashian’s attackers were likely more than mere jewel thieves.

    IV. The French Government Is Covering Up ISIS Involvement To Prevent Fears About Security Failures

    There are a number of concerning indications that the French government has no intention of properly investigating the Kardashian robbery and may in fact be attempting to cover up details of the incident to prevent further embarrassment. As Kardashian left Paris the day after the attack, Daily Mail ran an interview with Matt Fiddes, Michael Jackson’s former bodyguard, where he expressed surprise at the French government’s decision to allow Kardashian to leave the country so quickly and noted that it is common procedure for victims of serious crimes to assist police and prosecutors with inquiries for at least a few days. Kardashian has still not returned to Paris since the incident, possibly due to reports in tabloids that Kanye West will not allow it out of fears for his wife’s safety.

    The French government has routinely displayed a disinterest in speaking to any of the key witnesses who actually interacted with the attackers in the Hotel Pourtales. Despite being labeled a key witness by the media, the concierge at the hotel who was one of the only individuals to see the intruders face to face appears to remain outside of France, and is being denied re-entry by authorities. On January 9th, 2017 the concierge spoke with Daily Mail and revealed that he had left for Algeria to recover from the stress of the attack. He stated that the French authorities were refusing to renew his residence permit so that he could return to France, and that investigators had not contacted him to identify the suspects who were arrested. These details are troubling indications that France is more concerned with suppressing details about the attack than conducting a transparent and fair investigation into the incident.

    French police have also insisted that there was no CCTV footage or cameras installed in the Hotel Pourtales. On October 5th, 2016, Fox News interviewed several security experts with backgrounds in law enforcement and private investigation who expressed skepticism about these claims given the relative cheapness of security surveillance equipment and the high end, prestigious nature of the Hotel Pourtales. The experts stated that the claimed lack of security cameras indicated that either French authorities were lying about this fact, or that Kardashian’s security team was so utterly compromised that the attackers had foreknowledge of this blatant weakness. The Hotel Pourtales and Paris police department refused to comment to Fox News when the media outlet reached out with questions.

    An alleged coverup of ISIS involvement in Kardashian’s robbery would not be the first time that the French government engaged in unethical censorship to keep details about terror attacks from the public. In July 2016, online publication Heat Street translated and published a report by France’s Commission of Inquiry which revealed that the attackers of the Bataclan Theater in the November 2015 Paris terror attacks subjected victims to horrific torture, including disembowelment, cutting off body parts while victims were still alive, decapitation and other actions too graphic to put into print while videoing the acts for future use in propaganda. French lawmakers were outraged when prosecutors tried to claim that these details were just “rumors” despite a preponderance of evidence that this was not the case.

    The involvement of ISIS in the Kardashian attack would be a major blow to French efforts to ramp up security in the city after ISIS killed hundreds there in 2015. The day of Kardashian’s robbery, The Washington Post noted that the incident would do nothing but fuel already heightened concerns about the security situation in Paris and would create doubts about France’s state of emergency which was ostensibly put in place to prevent further terror attacks. BBC News has noted that there were a million fewer tourists visiting Paris in 2016 compared with the year before. To admit that not even an A-list celebrity was beyond the reach of terror groups operating in France would continue to cripple the vital tourism industry, which makes up more than 7% of France’s annual GDP.

    The facts surrounding the Kardashian robbery indicate that both authorities and various outlets of the media have not only ignored telltale signs that terror was a factor at play, but in some cases have actively sought to minimize or ignore evidence in the case. Given the unwillingness of the French government to address the increasing involvement of terrorism in European organized crime and its focus on prioritizing the prevention of public alarm at the true state of affairs in Paris, France could continue to remain unsafe, even for the rich and famous, despite the country’s longstanding state of emergency.

  • Sheelah Kolhatkar: Hedge Funds Are The Robber Barons Of Our Time

    Authored by Adam Taggart via PeakProsperity.com,

    Sheelah Kolhatkar, former hedge fund analyst and staff writer at the New Yorker, thinks hedge funds have enjoyed enormous unfair advantages for far too long.

    In her recent book Black Edge: Inside Information, Dirty Money, and the Quest to Bring Down the Most Wanted Man on Wall Street, she details out how many hedge funds use financial engineering and accounting tricks — even illegal insider information — to fill their coffers at investor expense. And then they use those ill-gotten gains to influence politics.

    The hedge fund industry grew up quietly out of almost nothing into this enormous force on Wall Street. There's almost $3 trillion estimated to be under management at hedge funds around the world — but hedge funds are lightly regulated, so we don’t always know what's going on in that sector.

     

    The people who have founded many of these hedge funds have become enormously wealthy. They have become the new robber barons of our time. The most successful among them have amassed multi-billion dollar fortunes largely based on trading and extracting very large fees from their investors for trading their money.

     

    These people now exert outside influence in our society, including as major political donors and lobbyists and in the world of philanthropy and other areas as well. So, I always like to keep an eye on that world — I think there’s a lot going on there that explains what’s going on in Washington, and we don’t always realize it’s connected. 

    In this podcast, Chris and Sheelah discuss the racket the hedge funds run, and as a case study, give close examination to the US government's tortured (and ultimately, unsuccessful) efforts to convict hedge fund kingpin Steve Cohen of SAC Capital on insider trading charges. Given their vast resources and paid influence, these modern robber barons remain practically untouchable.

    Click the play button below to listen to Chris' interview with Sheelah Kolhatkar (44m:50s).

  • The Balance of Gold and Silver, Report 2 April, 2017

    Last week, we discussed the growing stress in the credit markets. We noted this is a reason to buy gold, and likely the reason why gold buying has ticked up since just before Christmas.

    Many people live in countries where another paper scrip is declared to be money—to picture the absurdity, just imagine a king declaring that the tide must roll back and not get his feet wet when his throne is placed on the beach—not real money like the US dollar. It should be obvious, but we have seen much disinformation out there promoting the idea that the dollar is collapsing. Most of the time, most of these people buy dollars as the escape hatch from their native currencies.

    They buy the dollar first, and gold (for now) is a distant second.

    That leads to the question of silver. Do they buy silver in equal measure as gold, or is silver a distant second to gold, as gold is a distant second to the dollar?

    Theory tells us that gold is more portable. It is much, much more portable. First, the same weight of gold is about half the volume of silver. A 1oz gold Maple Leaf coin (which is pure gold) is much smaller than a 1oz silver Maple. And right now, the value of an ounce of gold is just about 70 times greater than the value of an ounce of silver. The math works out that the same value of silver is 126X more bulky than gold.

    If you are paying for storage, that may be important. It sure is, if you are thinking you may need to carry it on your person. A gold bar worth $120,000 would fit in your trouser pocket (a bit heavy at 3kg, but you could do it). That much silver would be almost 7 of those big bars which are the size of small loaves of bread. Each. All that silver would weigh about as much as two heavyweight boxers.

    Gold is also more liquid.

    What does the data tell us about demand for silver relative to gold right now?

    We will look at that below in the only true picture of supply and demand in the gold and silver markets. But first, the price and ratio charts.

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

    Next, this is a graph of the gold price measured in silver, otherwise known as the gold to silver ratio. It moved down this week. Is it approaching a line of support?

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

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

    Here is the gold graph.

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

    The price of the dollar fell a bit more (this is the inverse of the rising price of gold, measured in dollars, +$14). But look at that move in the cobasis (i.e. the red line, our measure of scarcity). What does it mean when the price of gold rises, but the metal becomes more scarce?

    We have been saying for a few weeks that fundamental buying—when people take real metal home, presumably not to bring it back to the market for the foreseeable future—is “sputtering”.  Last week, gold buying this week was biased towards speculation on futures. This week, the bias is back to physical metal.

    Our calculated fundamental price of gold is up over $30. It’s just a hair under $200 over the market price. Gold is being offered at a quite a discount.

    Now let’s look at silver.

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

    Uh oh. We can see immediately, that the cobasis has fallen in silver about 2/3 as much as it rose in gold. Granted, the price of silver rose 2.9% whereas that of gold went up only 0.5%. The speculators were much more aggressive in the silver market, as they often are.

    Our calculated silver fundamental price is up about 40 cents, whereas the market price was up 51 cents. The silver fundamental price is now about $0.80 over the market.

    Getting back to our question at the top, we can see in the data that people buy first gold when they fear credit stress and default. Speculators can temporarily move the price quite a lot, as they attempt to front-run the market. So, naturally, they are focusing on the silver market as the general rule when gold goes up, silver goes up more. That may be true when central banks’ stimulus efforts are successful in causing an increase in production of goods, including goods that contain silver.

    Less so, when metal buyers are not buying to consume but to opt out of the banking system.

    There are people who buy silver metal in preference to gold, for example those who cannot afford to buy gold. But at this stage, the balance favors gold.

    We calculate a fundamental gold-silver ratio of about 75.8.

    © 2017 Monetary Metals

  • REPORT: Mike Cernovich Reveals Obama Natl Security Advisor Susan Rice Responsible For Unmasking Trump Team

    Journalist and author Mike Cernovich has just dropped an exclusive bombshell – naming Obama’s National Security Advisor Susan Rice as the official responsible for the ‘unmasking’ of the incoming Trump team during ‘incidental’ surveillance. This was apparently discovered after the White House Counsel’s office reviewed Rice’s document log requests:

    The reports Rice requested to see are kept under tightly-controlled conditions. Each person must log her name before being granted access to them.

    Upon learning of Rice’s actions, [National Security Advisor] H. R. McMaster dispatched his close aide Derek Harvey to Capitol Hill to brief Chairman Nunes.

    Cernovich points out, as revealed in an article by Circa, that President Obama began loosening the rules regarding “incidental intercepts” starting in 2011 – making it easier for the US Government to spy on individuals who are not the primary target(s) of a surveillance operation.

    As his presidency drew to a close, Barack Obama’s top aides routinely reviewed intelligence reports gleaned from the National Security Agency’s incidental intercepts of Americans abroad, taking advantage of rules their boss relaxed starting in 2011 to help the government better fight terrorism, espionage by foreign enemies and hacking threats

    And guess who had authorization to unmask individuals who were ‘incidentally’ surveilled? Former CIA Director John Brennan, former Attorney General Loretta Lynch, and Obama’s National Security advisor Susan Rice.

    Also of note is the claim that New York Times journalist Maggie Haberman has been sitting on the Susan Rice story for at least two days:

    This reporter has been informed that Maggie Haberman has had this story about Susan Rice for at least 48 hours, and has chosen to sit on it in an effort to protect the reputation of former President Barack Obama.

    Fox News anchor Adam Housley tweeted on Friday that the surveillance that led to the unmasking began before Trump was the GOP nominee:

    //platform.twitter.com/widgets.js

    Housley also said that the person who did the unmasking is a “very senior” and “very well known” person in the surveillance community – and not someone in the FBI.

    //platform.twitter.com/widgets.js

    It seems the spreading of names was done for “political purposes that have nothing to do with national security,” or foreign intelligence, but hurting Trump’s team, Housley noted.

    “It had everything to do with hurting and embarrassing Trump and his team,” according to his sources. –TownHall

    This of course begs the question of whether or not President Obama would have ordered Rice to perform the unmasking…

     

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

  • Experts Warn A Single North Korean Nuke Could Blackout National Electric Grid And Kill 90% Of Americans

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

    For those who are skeptical about North Korea’s capabilities, there is an excellent article presented by The Hill, entitled How North Korea could kill 90 percent of Americans.”  The article is authored by none other than R. James Woolsey, former Director of the Central Intelligence Agency and by Dr. Peter Vincent Pry, the Executive Director of the EMP Task Force on National and Homeland Security and a former analyst with the CIA.

    Although the President is moving forward with his agenda, he has hit a “stall” in these first two months just on repealing Obamacare: The Republican Party has been the stall, refusing to give him the necessary votes and impetus to overcome it.  As mentioned in previous articles, it will take the President at least 6 months before his actions and effectiveness can be assessed.  Six months is a long time.  In the meantime, the U.S. continues to emplace measures such as THAAD (Terminal High Altitude Aerial Defense) being deployed to South Korea.

    China and Russia view it as an aggressive measure and a threat rather than a defensive strategy to protect South Korea and Japan.  This is partially correct.  The important thing to consider here is that North Koreans and their leader are starting to become more irate regarding the deployment of THAAD, the ongoing military exercises of U.S. and South Korean troops in the latter’s nation, and the demand by Japan for a first strike initiative to occur.

    Here are some excerpts from the article that readers should keep in mind:

    “The mainstream media, and some officials who should know better, continue to allege North Korea does not yet have capability to deliver on its repeated threats to strike the U.S. with nuclear weapons.  False reassurance is given to the American people that North Korea has not “demonstrated” that it can miniaturize a nuclear warhead small enough for missile delivery, or build a reentry vehicle for an intercontinental ballistic missile (ICBM) capable of penetrating the atmosphere to blast a U.S. city.

     

    Yet any nation that has built nuclear weapons and long-range missiles, as North Korea has done, can easily overcome the relatively much simpler technological challenge of warhead miniaturization and reentry vehicle design.”

    These two paragraphs clearly state that North Korea can miniaturize a warhead.  Once again, the naysayers will only be satisfied that they “can” when either an EMP (Electromagnetic Pulse) weapon and/or a nuclear warhead is delivered with either complete loss of power in the U.S. and/or the loss of an American city.  When such occurs, the naysayers will then say nothing.

    The objective is not to be “right” in this debate, but to be aware…to foster such awareness and help others to make whatever preparations they can before such occurs.  Here is another declaration by this article…a deep one:

    “The notion that North Korea is testing A-Bombs and H-Bomb components, but does not yet have the sophistication to miniaturize warheads and make reentry vehicles for missile delivery is absurd.”

    The threat could not be made any clearer than that.  The article goes on to describe assessments made in February and March of 2015 by former senior national security officials who warned this:

    “…North Korea should be regarded as capable of delivering by satellite a small nuclear warhead, specially designed to make a high-altitude electromagnetic pulse (EMP) attack against the United States.”

    In April Admiral William Gortney, former Commander of North American Aerospace Defense (NORAD) warned at a press conference that the KN-08 mobile ICBM missile system of North Korea could strike the United States with a nuclear warhead.

    Exactly six months later, Gortney declared (based on intelligence analyses) that North Korea has nuclear weapons, the capability to miniaturize them, and is capable of placing them on a missile that can reach the continental United States. This last excerpt of the article is very important due to the gravity of the current situation (the article was written today), the warning it gives, and the denouncement of the MSM (mainstream media) for obfuscating the facts on the matter and “underreporting” an issue of this magnitude:

    “According to the Congressional EMP Commission, a single warhead delivered by North Korean satellite could blackout the national electric grid and other life-sustaining critical infrastructures for over a year – killing 9 of 10 Americans by starvation and societal collapse.  Two North Korean satellites, the KMS-3 and KMS-4, presently orbit over the U.S. on trajectories consistent with surprise EMP attack. 

     

    Why do the press and public officials ignore or under-report these facts?  Perhaps no administration wants to acknowledge that North Korea is an existential threat on their watch.  Whatever the motives for obfuscating the North Korean nuclear threat, the need to protect the American people is immediate and urgent…”

    These men are experts in the field.  Why is the United States (as a whole) being so lackadaisical when it comes to such a problem?  As I have written in the past, it is my fervent wish that it never comes to pass…because the death of millions is not a “fair tradeoff” just to be able to be “right” or “correct” in a point of view.  For me personally, it is not about that.  It is about paying attention to men who make it their full-time business to be aware of the true threat that the MSM does not report, and reporting it here.  In this manner, you may be able to give yourself a small edge to make it by being aware and taking any precautions you can take with your family.  It is better to be aware, prepared, and have nothing happen than to wake up one morning and find an American city has been nuked and an EMP has rendered us without power.  Let us hope that doesn’t ever happen.

  • UK Puts Nuclear Power Plants And Airports On Terror Alert Over "Credible" Cyber Threat

    The global cyberwarfare scare washed ashore the British isles this weekend after UK nuclear power stations and airports were told to tighten defenses against terrorist attacks in the face of increased threats to electronic security systems, after intelligence agencies concluded terrorists could plant explosives in laptops and mobile phones that won’t be caught by normal security screenings.

    The Telegraph reports that British security services issued a series of alerts in the past 24 hours, warning that “terrorists may have developed ways of bypassing safety checks.”

    To be sure, there was no surprise as to the bogeyman behind the latest terror threat: intel agencies believe that ISIS and other terrorist groups have developed ways to plant explosives in laptops and mobile phones that can evade airport security screening methods.

    What is perhaps surprising, is that it is this latest intelligence which is said to be behind the recent bans, in both the US and UK, of travellers from a number of countries carrying laptops and large electronic devices on board. Furthermore, “there are concerns that terrorists will use the techniques to bypass screening devices at European and US airports.”

    There are also fears that computer hackers were trying to bypass nuclear power station security measures. Government officials have warned that terrorists, foreign spies and “hacktivists” are looking to exploit “vulnerabilities” in the nuclear industry’s internet defences. Energy minister Jesse Norman told The Telegraph that nuclear plants must make sure that they “remain resilient to evolving cyber threats”.

    Norman said: “The Government is fully committed to defending the UK against cyber threats, with a £1.9 billion investment designed to transform this country’s cyber security.”

     

    He said the civil nuclear strategy published in February sets out ways to ensure that the civil nuclear sector “can defend against, recover from, and remain resilient to evolving cyber threats”.

    Meanwhile, back in the US, intelligence officials have warned that groups including ISIS and al-Qaeda may have developed ways to build bombs in laptops and other electronic devices that can fool airport security. There are fears that terrorists made the breakthrough after obtaining airport screening equipment to allow them to experiment. FBI experts have tested how the explosives can be hidden inside laptop battery compartments in a way that allows a computer still to be turned on.

    The US Department of Homeland Security said in a statement: “Evaluated intelligence indicates that terrorist groups continue to target commercial aviation, to include smuggling explosive devices in electronics.

    “The US government continually reassesses existing intelligence and collects new intelligence. This allows us to constantly evaluate our aviation security processes and policies and make enhancements when they are deemed necessary to keep passengers safe.”

    Manny Gomez, a former FBI special agent, cited by the Telegraph said: “We had the shoe bomber, cartridge attempt, now this is the next level. We need to be several steps ahead of them.”

    For now there have been no effected cyber-terrorist attacks, although few things can redirect public attention and send the world to scramble demanding the “safety of the government” quite like a terrorist attack on a nuclear power plant. We can only hope that despite the overt warnings, such an escalation will not take place.

  • Bond Bears Battered As March Saw Biggest Short-Covering In 10Y Futures History

    Bond bears covered over 340,000 10Y futures contracts in March – more than $34 billion notional Treasuries – making it the biggest short-squeeze in Treasury Futures history.

     

    In fact, shorts covered across the entire yield curve complex… except for the every short-end…

    Net Treasury futures shorts are now back to the lowest levels since early December 2016 but traders continue to pile into the short-end betting massively on further rate hikes as Eurodollar shorts push on beyond $3 trillion…

    Seeingly betting on the continued "policy error" collapse of the yield curve…

    This was not a surprise to Raoul Pal who explains "Why Everyone’s Got It Wrong on Bonds"

    Raoul Pal is the man who correctly called the strong dollar in late 2014.

    And the crash in oil prices in 2014.

    And the fall in emerging markets.

    And the fall in junk bonds.

    He is the man who wrote ‘The End Game’ which is the most widely read financial article in the history of the internet.

    He’s also the person who writes The Global Macro Investor, an original research service for a hand-picked selection of hedge funds, family offices, sovereign wealth funds and other high-end investors. Not to mention he has a background in co-managing the Goldman Sachs hedge fund sales business in equities and equity derivatives. As well as founding and managing a macro hedge fund for GLG Partners, one of the world’s largest hedge fund firms.

    It might not surprise you to know that Raoul retired at 36 and now lives in a beach house on the tropical island of Little Cayman in the Caribbean.

    (That’s what happens when you get the big calls right).

    Today, he is predicting that the biggest ever short positions in the bond market are about to be proven wrong.

    Pal believes investors are looking the other way, with the economy likely to do the opposite of what people expect. In this exclusive presentation, Real Vision co-founder and writer of the elite research service, The Global Macro Investor, he explains why everyone’s wrong on bonds and why they are probably wrong on the dollar too – outlining two trades with a great risk reward and a high probability of success. 

    While the market narrative is one of reflation and growth, Raoul looks behind the headlines and lays out the scenario for an exciting opportunity in fixed income and an additional related FX play. Speculative short positioning in bonds was recently at record levels, but with real growth more of an illusion, due to the translation effects of very weak data this time last year, Raoul thinks the market could be caught out on the wrong side, with a great trade for right here, right now. While everyone is talking about Trump and reflation, Raoul is looking for the reversal of inflation and the actual story where everything is going to weaken dramatically.

    In this special video presentation, Raoul also alludes to what he thinks could be: ‘The Trade of 2017’ in the oil market and Real Vision subscribers will be the first to get in on the action.

    Here is a short clip of Raoul’s presentation:

    To access his full presentation for free, simply click the link below:

    http://rvtv.io/2mJ4nE5 

     

  • China Unveils New Drone-Killing Weapons

    While the "Silent Hunter" laser-gun is a more 'offensive' weapon, China has stepped up it's 'defense' too. As PopSci reports, Chinese authorities have developed and rolled out anti-drone "jamming" guns domestically…

    The $19,000 gun drone-jamming gun, one of several owned by the Wuhan police, can shut off drones up to a kilometer away.

    At a March 11 soccer game in Wuhan, China, police faced a new kind of threat: drones trespassing near the stadium. Their response was to use a new kind of weapon: an anti-drone gun that jammed the control signals, forcing the trespassing drones to land automatically.

    Given China's role as a global leader in consumer drone and military unmanned aircraft systems (UAS) exports, it only makes sense that China is also developing a range of anti-drone capabilities to stop unauthorized or hostile flying robots from coming over sensitive or vulnerable sites. In the case of Wuhan, the jammer "guns"—known as such not just because they "shoot" but also because they look like an assault rifle—cost approximately $19,000, and can reportedly jam control signals up to a kilometer away (though that figure assumes that the user has exceptional aim). Impressed with its capabilities, Wuhan police intend to buy more.

    The weapon is only one example of anti-drone tech. Comparable American jamming rifles, like the Battelle Drone Defender, are already used by Coalition forces in Iraq looking to shut down ISIL quadcopters used for surveillance and grenade attacks.

    Meanwhile, some European forces have gone for more novel solutions, like training eagles to attack errant small drones.

  • 46% Of Millennials In San Fran Ready To Move Out; Blame Housing, Traffic & Trump

    A growing number of snowflake millennials are saying they can no longer stand to live in the preeminent American ‘safe space’ of San Francisco because the “rent is too damn high”, the traffic is too damn congested and, well, President Trump.  According to a new poll conducted by the Bay Area Council, 40% of all people living in San Francisco say they’re ready to ditch the city for greener pastures while the number is even higher among millennials at 46%.

    A growing number of Bay Area residents, led by millennials (18-39), are looking to greener (or less expensive) pastures as the region’s housing and traffic crises combined with an astronomical cost of living take their toll, according to results of the 2017 Bay Area Council Poll released today. The poll found that 40 percent of respondents are considering leaving the Bay Area in the next few years, with millennials leading the way at 46 percent, along with those who spend the biggest share of their income on housing.

     

    “Losing our youth is a very bad economic and social strategy,” said Jim Wunderman, President and CEO of the Bay Area Council. “But until we get serious about building the housing we need we’re going to continue seeing our region drained of the young and diverse talent that has helped make the Bay Area an economic powerhouse. We know what the solutions are – streamline local approval and reduce fees and regulatory costs – we just need the political will here and in Sacramento to make them happen. It can be done, it must be done and we’re working now to get it done.”

    Meanwhile, the number of people saying they’re looking to ditch the city jumped 6 points versus 2016.

    San Fran

     

    Of course, housing and traffic were the most cited reasons that people were looking leave San Fran.  But, in a rather surprising new addition to the list of complaints, President Trump also showed up as a key threat to life in the Bay Area.  Perhaps, the snowflakes of California’s northern shores aren’t aware that even if they move elsewhere in the country that President Trump would still be their president?

    San Fran

     

    So it’s probably not at all surprising that a growing number of people think San Fran is on the “wrong track.”

    Santa Clara County, home to Silicon Valley and some of the region’s most expensive housing, has the highest number of residents thinking of finding a new address outside the Bay Area, at 47 percent. Across the entire region, renters (50%) are also much more likely than homeowners (31%) to want to cast off, while those who have lived in the Bay Area the longest are far less likely to want to exit than those who have more recently arrived.

     

    “We’ve pulled up the welcome mat,” Wunderman said. “A healthy, growing economy needs new blood, but resistance to new housing combined with the grind of traffic and an ever-lengthening commute are closing the door to new residents, to a new generation. The Council is addressing these problems by supporting new funding at a state level to fix roads and highways, advocating for federal funding to increase capacity on Caltrain, working to expand regional ferry service and urging employers to promote greater use of carpool and rideshare technologies. On the housing front, the Council last year sponsored the only significant housing bill to win approval, making it faster, easier and less expensive for homeowners to add affordable in-laws units. This year, we’re working with legislators on a number of bills to streamline housing approvals that represent our best
    hope to address the state’s massive housing shortage.”

    San Fran

     

    Seems like the flood of tech gurus swarming San Fran have just found out that their $200,000 salaries will buy them the same lifestyle as a $60,000 salary in any other ‘normal’ American town.

    Here are the full survey results:

Digest powered by RSS Digest

Apr 02

Today’s News 2nd April 2017

  • Obamacare Implosion Now? Since Obama Siphoned GSE Dividends To Prop Up, Can Trump Simply Halt 1st Qtr Sweep?

    Earlier this month, Harvard Ph.D. Jerome Corsi of InfoWars (@jerome_corsi) and a CPA “who worked for two years for a major U.S. accounting firm as an outside auditor for Freddie Mac,” confirmed a 2012 scheme hatched by the Obama administration to funnel hundreds of billions in dividends from Government Sponsored Enterprises (GSE) Fannie Mae and Freddie Mac to prop up the failing Obamacare program – by paying subsidies to insurers to remain in the system.

    If you need to catch up on it, read the InfoWars article above or watch this 18 minute video:

      

    The conclusion reached by Corsi and others is that this was probably illegal.

    In fact, House Republicans actually sued the Obama Administration in 2014 over the fact that the subsidies to insurers weren’t appropriated by congress and won, which the Obama administration appealed. As Zerohedge and the Atlanta Journal Constitution pointed out last week, the Trump administration has until May 22nd to decide whether or not to pursue the appeal:

    In 2014, House Republicans sued the Obama administration over the constitutionality of the cost-sharing reduction payments, which had not been appropriated by Congress. The lawmakers won the lawsuit, and the Obama administration appealed it. Late last year, with a new administration on the other end of the suit, the House sought to pause the proceedings — with a deadline for a status update in late May. –AJC

    And a ZeroHedge analysis:

    Of course, any decision to remove those subsidies would likely result in yet another massive round of premium hikes and further withdrawals from the already crippled exchanges where an astounding number of counties across the country have already been cut to just 1 health insurance provider.  And, as we’ve pointed out before, higher rates = lower participation = deterioration of risk pool = higher rates….and the cycle just repeats until it eventually collapses. –ZeroHedge

    Meanwhile, President Trump has made several Tweets since the Ryancare debacle in congress:

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    But wait, could it happen even sooner? Former Blackrock portfolio manager Ed Dowd may be on to something…

    Simple question: what if Trump’s Treasury simply stopped the illegal dividend sweep NOW? It is the end of the 1st quarter, after all…

    Not only would it force the MSM to cover Obama’s 2012 scheme to siphon funds from Fannie and Freddie, the stage would be set for far more sensible healthcare solutions from lawmakers who aren’t simply shilling for the industry.


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

  • Connecticut Set To Become First State To Allow Deadly Police Drones

    Connecticut could become the first US state to allow police to use drones equipped with deadly weapons if a bill opposed by civil libertarians becomes law. The bill, which was approved overwhelmingly by the state legislature’s judiciary committee on Wednesday, would ban so-called weaponized drones in the state but exempts police and other agencies involved in law enforcement, the AP reported. The legislation was introduced as a complete ban on weaponized drones but just before the committee vote it was amended to exclude police from the restriction. Connecticut Governor Dannel Malloy, a Democrat, was reviewing the proposal, “however in previous years he has not supported this concept,” spokesman Chris Collibee wrote in an email.

    “Obviously this is for very limited circumstances,” said Republican state Sen. John Kissel, of Enfield, co-chairman of the Judiciary Committee that approved the measure Wednesday and sent it to the House of Representatives. “We can certainly envision some incident on some campus or someplace where someone is a rogue shooter or someone was kidnapped and you try to blow out a tire.”

    The bill now goes to the House of Representatives for consideration. Details on how law enforcement could use drones with weapons would be spelled out in new rules to be developed by the state Police Officer Standards and Training Council. Officers also would have to receive training before being allowed to use drones with weapons.

    North Dakota is the only state that allows police to use weaponized drones, but limits the use to “less lethal” weapons, including stun guns, rubber bullets and tear gas.

    Currently five states – Nevada, North Carolina, Oregon, Vermont and Wisconsin – prohibit anyone from using a weaponized drone, while Maine and Virginia ban police from using armed drones, according to the National Conference of State Legislatures. Several other states have restricted drone use in general. So far, 36 states have enacted laws restricting drones and an additional four states have adopted drone limits, according to the National Conference of State Legislatures.

    Meanwhile, concerns are growing about potential unchecked police brutality and death raining from the robotic skies: civil libertarians and civil rights activists are lobbying to restore the bill to its original language before the full House vote Reuters adds.

    “Data shows police force is disproportionately used on minority communities, and we believe that armed drones would be used in urban centers and on minority communities,” said David McGuire, executive director of the American Civil Liberties Union in Connecticut. “We would be setting a dangerous precedent,” McGuire added. “It is really concerning and outrageous that that’s being considered in our state legislature. Lethal force raises this to a level of real heightened concern.”

    “That’s not the kind of precedent we want to set here,” McGuire said of the prospect that Connecticut would become the first state to allow police to use lethally armed drones.

    Others echoed McGuire’s concerns: “We have huge concerns that they would use this new technology to abuse our communities,” said Scot X. Esdaile, president of state chapter of the NAACP. Esdaile said he has received calls from around the country from NAACP officials and others concerned about the Connecticut legislation.

    Three police departments in the state – Hartford, Plainfield and Woodbury – began using drones within the past year, according to the American Civil Liberties Union of Connecticut.

    For now, however, the proposal is unlikely to unleash scenes out of some Robocop spinoff: The bill includes restrictions on drone use and reporting requirements that are supported by the ACLU.

    It would require police to get a warrant before using a drone, unless there are emergency circumstances or the person who is the subject of the drone use gives permission. It also would require police to report yearly on how often they use drones and why, and create new crimes and penalties for criminal use of drones, including voyeurism.

    Furthermore, final passage is not assured: although the bill overwhelmingly passed the Judiciary Committee, several members said they just wanted to see the proposal get to the House floor for debate. They said they had concerns about police using deadly force with drones. If Connecticut’s Democratic-controlled House passes the bill it will move to the Senate, which is split evenly between Democrats and Republicans.

    “I think that police are taught one thing,” said Democratic Bridgeport Sen. Edwin Gomes. “You put a weapon in their hand, they shoot center mass, they shoot to kill. If it’s going to be used, you’re going to use it to kill somebody.”

    Finally, for those wondering how a drone could possibly shoot, the following video of a drone shooting a gun – appropriately enough in Connecticut – should answer that question.

  • Does Size Matter? Visualizing The Population Of Every Country (In Bubbles)

    The beautiful thing about data visualization is that it can appear deceptively simple, writes VisualCapitalist's Jeff Desjardin. The world is infinitely complex and burgeoning with all kinds of information. As a result, it seems counterintuitive that things can be reduced to a basic bubble chart or a graph – and to be fair, most things can’t. When the opportunity does arise, however, the results can be very compelling and thought-provoking. A distilled story can help create insight around a subject that wasn’t possible when looking at it with more nuance and complexity.

    THE POPULATION OF EVERY COUNTRY IN BUBBLES

    Today’s visualization comes from Datashown, and it helps to give some perspective on world population.

    It’s a deceptively simple visualization, but the story that gets distilled is loud and clear:

    The beauty lies in the simplicity – and although all countries are represented, only the labels of the biggest are shown.

    If you want to dive into the granular data, here is an interactive version of the same diagram, with all countries and population statistics embedded.

    ZOOMING IN ON THE UNITED STATES

    On the above bubble chart, envision “zooming in” on the circle representing the United States, which is located just below China and India.

    Here’s the population of every U.S. county. Click the image for an interactive version, from Overflow Data.

     

    Feeling small yet?

    Just for fun – here’s a video that notches it up to a more universal level:

     

  • "If True, Does Not Get Much Bigger" Trump Tweets About "Very Well Known" Intel Official Behind Trump "Unmasking"

    After slamming NBC’s coverage of the “Fake Trump/Russia story”, congratulating the NYTimes for “finally getting it” on Obamacare, Trump on Saturday commented on the previously discussed Fox News story about a “very senior, very well known” U.S. intelligence official who was allegedly involved in unmasking the names of Trump associates, and who had reprotedly surveilled Trump before the nomination.

    “Wow, @FoxNews just reporting big news. Source: ‘Official behind unmasking is high up. Known Intel official is responsible. Some unmasked not associated with Russia. Trump team spied on before he was nominated. If this is true, does not get much bigger. Would be sad for U.S.,” he added.

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    As discussed Friday night, A Fox News source (unnamed, because these days that’s all there is, just ask the NYT and Wapo) said that the U.S. official behind the systematic unmasking of Trump associates and private individuals was “very well known, very high up, very senior in the intelligence world” and was doing so for political, not nationa security reasons, intent on “hurting and embarrassing Trump and his team.” In other words, another intel agency war between the old, pro-Hillary Clinton, guard and the new administration.

    Additionally, the Friday Fox News report cited “a number of sources” with claims that not only were the two White House officials not the sources of the information shared with Nunes, but that Nunes knew of the information in January, and that the agencies where the information came from had blocked Nunes from gaining access to it. Further, the report cited officials within the agencies who said they were frustrated with the spreading of names for political purposes.

    “Our sources, who have direct knowledge of what took place, were upset because those two individuals, they say, had nothing to do with the outing of this information,” Fox reported.

    “We’ve learned that the surveillance that led to the unmasking of what started way before President Trump was even the GOP nominee,” Fox News reported Adam Housley said. “The person who did the unmasking, I’m told, is very well known, very high up, very senior in the intelligence world and is not in the FBI.”

    “This led to other surveillance which led to multiple names being unmasked. Again these are private citizens in the United States,” said Housley. “This had nothing to do with Russia, I’m told, or foreign intelligence of any kind.”

    “Fox also learned that an individual with direct knowledge that after Nunes had been approached by his source, the agencies basically would not allow him in at all,” said Housley.

    Understandably, the Fox News report has gotten zero media attention on any other news outlet.

    For those who missed the original report from Friday night, it is reproduced below.

    * * *

    Intel Official Behind “Unmasking” Of Trump Associates Is “Very Senior, Very Well Known”

    Day after day, various media outlets, well really mostly the NYT and WaPo, have delivered Trump-administration-incriminating, Russia-link-related tape bombs sourced via leaks (in the hope of keeping the narrative alive and “resisting.”). It now turns out, according to FXN report, that the US official who “unmasked” the names of multiple private citizens affiliated with the Trump team is someone “very well known, very high up, very senior in the intelligence world.”

    As Malia Zimmerman and Adam Housley report, intelligence and House sources with direct knowledge of the disclosure of classified names (yes, yet another “unnamed source”) said that House Intelligence Committee Chairman Devin Nunes, now knows who is responsible – and that person is not in the FBI (i.e. it is not James Comey)

    Housley said his sources were motivated to come forward by a New York Times report yesterday which reportedly outed two people who helped Nunes access information during a meeting in the Old Executive Office Building. However, Housley’s sources claim the two people who helped Nunes “navigate” to the information were not his sources. In fact, Nunes had been aware of the information since January (long before Trump’s ‘wiretap’ tweet) but had been unable to view the documents themselves because of “stonewalling” by the agencies in question.

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    For a private citizen to be “unmasked,” or named, in an intelligence report is extremely rare. Typically, the American is a suspect in a crime, is in danger or has to be named to explain the context of the report.

    “The main issue in this case, is not only the unmasking of these names of private citizens, but the spreading of these names for political purposes that have nothing to do with national security or an investigation into Russia’s interference in the U.S. election,” a congressional source close to the investigation told Fox News.

    The White House, meanwhile, is urging Nunes and his colleagues to keep pursuing what improper surveillance and leaks may have occurred before Trump took office. They’ve been emboldened in the wake of March 2 comments from former Obama administration official Evelyn Farkas, who on MSNBC suggested her former colleagues tried to gather material on Trump team contacts with Russia.

    White House Press Secretary Sean Spicer said Friday her comments and other reports raise “serious” concerns about whether there was an “organized and widespread effort by the Obama administration to use and leak highly sensitive intelligence information for political purposes.”

    “Dr. Farkas’ admissions alone are devastating,” he said.

    Clearly this confirms what Evelyn Farakas said, accidentally implicated the Obama White House in the surveillance of Trump’s campaign staff:

    The Trump folks, if they found out how we knew what we knew about the Trump staff dealing with Russians, that they would try to compromise those sources and methods, meaning we would not longer have access to that intelligence.

    Furthermore, Farkas effectively corroborated a New York Times article from early March which cited “Former American officials” as their anonymous source regarding efforts to leak this surveillance on the Trump team to Democrats across Washington DC.

    * * *

    In addition, citizens affiliated with Trump’s team who were unmasked were not associated with any intelligence about Russia or other foreign intelligence, sources confirmed. The initial unmasking led to other surveillance, which led to other private citizens being wrongly unmasked, sources said.

    “Unmasking is not unprecedented, but unmasking for political purposes … specifically of Trump transition team members … is highly suspect and questionable,” according to an intelligence source. “Opposition by some in the intelligence agencies who were very connected to the Obama and Clinton teams was strong. After Trump was elected, they decided they were going to ruin his presidency by picking them off one by one.”

    * * *

    So if the source isn’t Comey, has anyone seen Jim Clapper recently? The answer should emerge soon, meanwhile the ridiculous game with very high stakes of spy vs spy, or in this case source vs source, continues.

    The report summarized below in video format:

    http://video.foxnews.com/v/embed.js?id=5380606763001&w=500&h=281

    Watch the latest video at video.foxnews.com

  • WARNING: U.S. Ponzi Retirement Market In Big Trouble As Withdrawals Now Exceed Contributions

    srsrocco

    By the SRSrocco Report,

    The U.S. Retirement Market is in BIG TROUBLE as annual benefits paid out are now larger than total contributions.  Actually, the amount of net withdrawals were the highest in history.  When payouts become larger than contributions… then we have the making of the typical PONZI SCHEME.

    Americans who have invested their hard-earned money into a 401K, had no idea that it was the Greatest Ponzi Scheme in history.  Unfortunately, when the markets crack, so will the value of the U.S. Retirement market.  On the other hand, Americans who were wise enough to purchase physical precious metals will protect their wealth as the U.S. Paper Retirement Market collapses.

    According to the most recent data by the ICI – Investment Company Institute, the U.S. Retirement Market ballooned to a new record high of $25.3 trillion at the end of 2016:

    US Retirmen Market

    As we can see, the U.S. Retirement Market has nearly doubled since the collapse of the Housing & Banking sectors in 2008.  Total value of the U.S. Retirement Market increased from a low of $13.9 trillion in 2008 to $25.3 trillion at the end of 2016.  It’s not quite double… but close enough.

    Furthermore, the surge in U.S. Retirement assets from $19.7 trillion in 2012 to $22.6 trillion in 2013 was due to the Federal Reserve QE 3 policy (Quantitative Easing #3).  This was the year that the monetary stimulus was funneled into the Stock, Bond and Real Estate Market and away from the precious metals.  Thus, the precious metals suffered huge price declines in 2013.

    As Americans continue to contribute into their “supposed” retirement plans, few realize that more funds are now heading out than going in.  This is not a good sign at all.  If we look at the most recent data from the Investment Company Institute, Americans contributed a total of $373.6 billion into their Private Sector DC Plans in 2014 versus total benefits paid out of $402.3 billion.  Which means, net contributions were a negative $28.7 billion… the highest on record:

    U.S. Retirement Market Contributions vs Withdrawals

    The grey bars represent total contributions while the red line shows total benefits paid.  The net result is shown in the GREEN & RED bars at the lower part of the chart.  Green bars are positive net contributions, while the red bars are net withdrawals.  Unfortunately, the Investment Company Institute does not provide data for 2015 or 2016 yet.  It will be interesting to see if these net withdrawals continue to increase.  My gut tells me that they most likely have.

    NOTE: The majority of the Private-Sector DC Plans were 401k’s, which accounted for roughly 98% of total contributions and 91% of total benefits paid.

    So, why is the U.S. Retirement Market is BIG TROUBLE?  Well, if we look at the next chart, we find our answer:

    US Retirement Market vs Public Debt

    The chart shows that the U.S. Retirement Market has increased right along with surge in total U.S. public debt.  Thus, the U.S. Retirement Market’s value is being propped up by debt.   As the U.S. debt exploded from $875 billion in 1980 to $20 trillion currently, the U.S. Retirement Market surged from $822 billion to $25.3 trillion during the same time period.  We must remember the following:

    DEBT IS NOT AN ASSET.  Also, the true value is subtracting total debt from total assets

    Thus, if we just applied simple math here, the U.S. Retirement market’s net value is approximately $5 trillion… 80% less than what it is currently.  And that $5 trillion figure is likely inflated.  I do realize I am making a very general calculation here, but DEBTS are not ASSETS.

    I discussed this in my recent interview on the Hagmann Report, which I highly recommend watching if you haven’t already:

    The reason the U.S. Retirement Market is a huge Ponzi Scheme is that it has stored “Digital IOU’s” rather than real physical wealth.  A typical stock price is based on “Net Present Value.”  They take the future value of the company’s earnings and give it a price today.  Unfortunately, companies earnings are based on the burning energy in the future.   There lies the rub.

    Back during the 1930’s, most stock prices were based on the BOOK VALUE.  Basically, what the value of the company was worth if all its assets were sold.  Today, a stock price is based on EARNINGS.  Earnings can and will implode when the markets crack due to massive debt and falling oil production.

    However, the few Americans who were wise enough to purchase physical precious metals rather than put their money into the Greatest Ponzi Scheme in history, will be protect wealth while most paper assets disintegrate.

    $100,000 Physical Gold Investment vs $100,000 Invested in 401K

    If an American decided to purchase $100,000 in physical gold over the past 30 years, they would have a true physical asset that they can sell close to that $100,000 figure.  If an American had $100,000 in their 401K, they would have to pay a 10% penalty for early withdrawal.  While a 401K withdrawal is taxed as regular income compared to physical gold taxed at a maximum of 28% capital gains, at least you can hold onto nearly three-quarters of your wealth (likely much higher percentage).

    That being said, once the market crash occurs, the value of most American’s retirement assets are going to implode.  I would not be surprised to see at least 50-75% collapse (or more) in the typical U.S. Retirement Account.  Thus, the $100,000 invested in a 401K could fall to a low of $25,000, while $100,000 invested in physical gold, could easily double to $200,000.

    Actually, this is the likely outcome.  Mark my words.  A typical American who has invested $100,000 into a typical 401K will find that his or her retirement account will fall to one-tenth its value versus someone who purchased physical gold instead.  The coming collapse of the U.S. and Global Oil Industries, due to lower oil prices, will be the factor that destroys the U.S. Retirement Ponzi Scheme.  It is not a matter of IF, it is a matter of WHEN.

    Please continue to check back at the SRSrocco Report as I will be providing updates on the continued disintegration of the U.S. and Global Oil Industry.  Paying attention to what is taking place in the Energy Industry will provide CLUES to the timing of the Market Collapse.

    Lastly, if you haven’t checked out our new PRECIOUS METALS INVESTING section or our new LOWEST COST PRECIOUS METALS STORAGE page, I highly recommend you do.

    Check back for new articles and updates at the SRSrocco Report.

  • Stockman Warns "'Stimulus-Blinded' Mules Don't See What's Coming At All"

    Authored by David Stockman via Bonner & Partners,

    Reagan’s top economic adviser David Stockman explains why Trump’s tax cuts… and his stimulus plan… are dead on arrival.

    The mules of Wall Street were back at it again, buying the dips after the overnight whoosh downward in the futures market. Apparently, it will take an actual two-by-four between the eyes to break a habit that has been working for 96 months now since the March 2009 post-crisis bottom.

    We think it is plain as day, however, that we are in a new ball game that the "stimulus-blinded” mules don’t see coming at all. To wit, they have been juiced for eight years running by the Keynesian apparatchiks at the Fed who needed permission from exactly no one to run the printing presses full tilt or to rescue the market with a new round of QE or an extension of ZIRP whenever the indices began to wobble.

    But now, even the money printers have made it clear in no uncertain terms that they are done for this cycle, anyway, and that they will be belatedly but consistently raising interest rates for what ought to be a truly scary reason.

    That is, the denizens of the Eccles Building have finally realized that they have not outlawed the business cycle after all and need to raise rates toward 2-3% so that they have headroom to "cut" the next time the economy slides into the ditch.

    In effect, the Fed is saying to Wall Street: "Price in" a recession because we are!

    After all, our monetary central planners are not reluctantly allowing interest rates to lift off the zero bound because they have become converts to the cause of honest price discovery—-nor are they fixing to liberate money rates, debt yields, and the prices of stocks and other financial assets to clear on the free market.

    Instead, they are merely storing up monetary ammo for the next downturn.

    But the Wall Street mules keep buying the dips anyway because they are under the preposterous delusion that one source of "stimulus" is just as good as the next.

    And since the gamblers have now decreed that the "stimulus" baton be handed off to fiscal policy, it only remains for Congress and the White House to shape up and get the job done with all deliberate speed.

    But they won’t.

    Not in a million years.

    The massive Trump tax cut and infrastructure stimulus is DOA because Uncle Sam is broke and the U.S. economy has slithered into moribund old age.

    In that context, it’s not remotely the same as the 12  members of the FOMC sitting behind closed doors for two days jawing about the short-term economic weather; and then at the conclusion of their gabfest, ordering the New York Fed’s open market desk to flood the canyons of Wall Street with cash by buying another $80 billion of bonds with digital credits conjured from thin air.

    Au contraire. Fiscal policy is inherently an exercise in herding cats and an especially impossible one when the cupboards are bare.

    The essence of the matter at the present state of play is the legislative equivalent of "no ticky, no washy."

    Without a 10-year budget resolution for FY [fiscal year] 2018 and associated reconciliation instructions, there is no possibility of passing a tax bill or even an infrastructure spending boondoggle.

    But hammering out a budget resolution, passing it in each house, and reconciling the differences in conference would take months under the best of circumstances. But given the parlous state of Uncle Sam’s fiscal condition and the partisan acrimony that already suffuses Washington in the era of Trump, passage of a budget resolution by summer would be a miracle in itself.

    Indeed, even the thought of surmounting this next daunting legislative obstacle course puts to rest this week’s particular Wall Street fantasy. Namely that after being burned by the Freedom Caucus on Obamacare Lite, the Trump White House will now "pivot" to the middle and form a coalition with the Democrats to make a deal on corporate tax cuts and infrastructure spending.

    Yes, and if dogs could whistle, the world would be a chorus.

    That is to say, there is no conceivable fiscal policy menu that could be agreed upon by Speaker Ryan, Nancy Pelosi, Chuck Schumer, and the Donald, and then be shoe-horned into a 10-year budget resolution.

    Yet without a budget resolution and reconciliation instructions, there is not a fiscal stimulus "ticky" and no grand bipartisan compromise on building airports and slashing corporate tax rates.

    So what lies directly ahead, therefore, is another bumbling attempt by the White House and Congressional Republicans to hammer out an FY 2018 budget resolution and what amounts to a 10-year fiscal plan. And it is there where the whole fantasy of the Trump Stimulus comes a cropper.

    There are not remotely 218 GOP votes for what would be a $12 trillion-13 trillion add to the national debt with the Trump Stimulus program over the next decade—-even with all the "dynamic" scoring and revenue "reflows" that are imaginable.

    To be sure, this is why the GOP Congressional leadership stoutly insists on a deficit-neutral tax cut. They are keenly aware of the debt monster they have been kicking down the road—-even if the headline-reading robo-traders of Wall Street are not.

    What that means, in turn, of course, is that the rapidly fracturing Trump/Republican coalition must find the offsets on the spending side of the ledger.

    In short, the whole enterprise amounts to budgetary madness and demonstrates the monumental magnitude of the Debt Trap that has enveloped the Imperial City.

    And the “buy the dip” crowd will soon be getting that two-by-four between the eyes.

    So now is not the time to buy.

  • Blaming Russia For Everything

    Authored by Robert Parry via The Strategic Culture Foundation,

    It’s almost getting comical how everything that happens in the United States gets blamed on Russia! Russia! Russia! And, if any American points out the absurdity of this argument, he or she must be a “Moscow stooge” or a “Putin puppet.”

    The FX series, “The Americans,” a spy thriller about two deep-cover Soviet spies in the 1980s

    When Sen. Marco Rubio’s presidential campaign fails seemingly because he was a wet-behind-the-ears candidate who performed like a robot during debates repeating the same talking points over and over, you might have cited those shortcomings to explain why “Little Marco” flamed out. However, if you did, that would make you a Russian “useful idiot”! The “real” reason for his failure, as we learned from Thursday’s Senate Intelligence Committee hearing, was Russia!

    When Americans turned against President Obama’s Pacific trade deals, you might have thought that it was because people across the country had grown sick and tired of these neoliberal agreements that have left large swaths of the country deindustrialized and former blue-collar workers turning to opioids and alcohol. But if you did think that, that would mean you are a dupe of the clever Russkies, as ex-British spy Christopher Steele made clear in one of his “oppo” research reports against Donald Trump. As Steele’s dossier explained, the rejection of Obama’s TPP and TTIP trade deals resulted from Russian propaganda!

    When Hillary Clinton boots a presidential election that was literally hers to lose, you might have thought that she lost because she insisted on channeling her State Department emails through a private server that endangered national security; that she gave paid speeches to Wall Street and tried to hide the contents from the voters; that she called half of Donald Trump’s supporters “deplorables”; that she was a widely disliked establishment candidate in an anti-establishment year; that she was shoved down the throats of progressive Democrats by a Democratic Party hierarchy that made her nomination “inevitable” via the undemocratic use of unelected “super-delegates”; that some of her State Department emails were found on the laptop of suspected sex offender Anthony Weiner (the husband of Clinton’s close aide Huma Abedin); and that the laptop discovery caused FBI Director James Comey to briefly reopen the investigation of Clinton’s private email server in the last days of the campaign.

    You might even recall that Clinton herself blamed her late collapse in the polls on Comey’s announcement, as did other liberal luminaries such as New York Times columnist Paul Krugman. But if you thought those thoughts or remembered those memories, that is just more proof that you are a “Russian mole”!

    As we all should know in our properly restructured memory banks and our rearranged sense of reality, it was all Russia’s fault! Russia did it by undermining our democratic process through the clever means of releasing truthful information via WikiLeaks that provided evidence of how the Democratic National Committee rigged the nomination process against Sen. Bernie Sanders, revealed the contents of Clinton’s hidden Wall Street speeches, and exposed pay-to-play features of the Clinton Foundation in its dealings with foreign entities.

    Boris and Natasha, the evil spies from the Rocky and Bullwinkle shows

    You see the evil Russians undermined American democracy by arming the American people with truthful information! How dastardly is that! Could Boris and Natasha do any better or worse? And although the Soviet spies in FX’s “The Americans” were in their prime in the 1980s and would be pretty old by now, do we know where they are in the present day? Though WikiLeaks denies getting the two batches of emails – the DNC’s and Clinton campaign chairman John Podesta’s – from the Russians, have we ruled out that the emails might have been slipped to WikiLeaks by the FX characters Philip and Elizabeth Jennings, presumably in disguise?

    Oddly, too, when similar factual revelations come from Western-favored leaks, such as the purloined financial records of a Panamanian law firm known as the “Panama Papers,” we hail the disclosures regardless of the dubious methods that were used to steal them, especially if the contents can be spun to undermine disfavored governments like Russia (while also inconveniently embarrassing a few unimportant “’allies”).

    But if you make that comparison or you note how the U.S. Agency for International Development and the U.S. government-funded National Endowment for Democracy have supported various “independent” journalists and news outlets to advance U.S. propaganda, that makes you guilty of “moral equivalence,” another serious offense.

    Crazy Talk

    So now that you know how the game is played, you had the Senate Intelligence Committee eliciting testimony from people like media watcher Clint Watts, who seems to believe that any criticism of a U.S. government official (at least anyone he likes) must be directed by Russia!

    Rep. Paul Ryan, R-Wisconsin

    “This past week we observed social media accounts discrediting U.S. Speaker of the House Paul Ryan,” said Watts, who is billed in The Washington Post as “an expert in terrorism forecasting and Russian influence operations.”

    Gee, I know you might say that you went on Facebook last week to criticize Ryan for bungling the “repeal and replace” of Obamacare by proposing a scheme that managed to alienate both right-wing and moderate Republicans as well as all Democrats. But that only proves you are indeed a Russian disinformation agent! (Watts also claimed that Sen. Rubio’s presidential bid “anecdotally suffered” from an online Russian campaign against him.)

    As Watts describes these nefarious Russian schemes, they are so nefarious that they don’t have any discernible earmarks or detectable predictability. In his view, the Russians don’t want to help any particular person or group, just undermine America’s faith in its democracy.

    As Watts puts it, Russians attack “people on both sides of the aisle … solely based on what they [the Russians] want to achieve in their own landscape, whatever the Russian foreign policy objectives are. They win because they play both sides.” In other words, any political comment that an American might make might just prove that you’re a traitor.

    But Watts singled out President Trump for special criticism because he supposedly has tweeted about Russian-planted conspiracy theories. “Part of the reason active measures have worked in this U.S. election is because the commander-in-chief has used Russian active measure at times against his opponent,” Watts said, citing Trump’s bogus claims about 2016 voter fraud and his earlier silliness about President Obama’s Kenyan birthplace. Yes, as we all know, every goofy idea is manufactured in Russia. Americans are incapable of developing their own nonsense.

    Watts then suggested that some kind of Ministry of Truth is needed to stamp out unapproved information. “Until we get a firm basis on fact and fiction in our own country, … we’re going to have a big problem,” Watts said. He warned of a dangerous future from Russian information: “Somewhere in their cache right now there’s tremendous amounts of information laying around they can weaponize against other Americans.”

    Perhaps what is even more frightening than the Russians letting Americans in on how Washington’s political process really works – by somehow slipping WikiLeaks some evidence of Democratic Party bigwigs tilting the Democratic primaries to ensure Clinton’s nomination and revealing what Clinton told those Wall Street bankers – is the idea that the U.S. government should be enlisted to enforce what Americans get to see and hear.

    The PropOrNot Smear

    Watts and his alarums showed up in another context in the weeks after the 2016 election when The Washington Post ran a front-page story highlighting the claims by an anonymous group, PropOrNot, which was pushing a blacklist of 200 Internet news sites, including such independent sources of information as Counterpunch, Truthdig, Naked Capitalism, Zero Hedge, Truth-out and Consortiumnews.

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

    Though the Post granted PropOrNot anonymity so it could safely slander independent-minded journalists, the Post turned to Watts to bolster PropOrNot’s case. “They [the Russians] want to essentially erode faith in the U.S. government or U.S. government interests,” Watts said. “This was their standard mode during the Cold War. The problem is that this was hard to do before social media.”

    The Post then linked to an article that Watts had co-authored entitled, “Trolling for Trump: How Russia Is Trying to Destroy Our Democracy.” which, in turn, cited as proof RT articles that mentioned Hillary Clinton’s health problem last September (which was later acknowledged to be a bout with pneumonia) and that discussed the vulnerabilities of the Federal Reserve (in an age of escalating public and private debt). Both might seem to you like reasonable topics for journalists, but you must understand that RT – because it is Russian-sponsored – has become the favorite whipping boy of anyone trying to make the case that America is besieged by Russian propaganda. And don’t you dare mention that almost no one in America actually watches RT or you might end up on PropOrNot’s list, too.

    Watts and his cohorts continue: “Social issues currently provide a useful window for Russian messaging. Police brutality, racial tensions, protests, anti-government standoffs, online privacy concerns, and alleged government misconduct are all emphasized to magnify their scale and leveraged to undermine the fabric of society.”

    And, we know for sure that you’re a Russian agent if you express any concern that the heightened tensions between the U.S. and Russia might lead to nuclear war. As Watts and friends write, “More recently, Moscow turned to stoking fears of nuclear war between the United States and Russia” – and their “proof” was a link not to RT but to the financial Web site, Zero Hedge, which already had made it onto PropOrNot’s black list.

    So, let’s see if we got this right: We are not to worry our pretty little heads about nuclear war or a future financial meltdown or police brutality toward racial minorities or race relations in general or armed right-wing clashes with authorities or spying on our Internet use or any government wrongdoing at all or even citizen protests against that wrongdoing. Because if we debate such issues – if we even read about such issues – we are playing into Vladimir Putin’s evil plans.

    What Democracy?

    Which makes me wonder what kind of “democracy” these brave “defenders of democracy” have in mind. The New York Times, The Washington Post and some establishment-approved Internet sites already have begun work on establishing standards for what information the American people will be allowed to see and hear – with disapproved sources of news marginalized by Internet search engines or prevented from earning any money by exclusion from Google and other ad programs.

    U.S. Secretary of State Colin Powell presents a dummy vial of anthrax on Feb. 5, 2003, during a speech to the UN Security Council outlining the American case that Iraq possessed forbidden stockpiles of WMD

    Presumably, the 200 or so Web sites on PropOrNot’s black list would be the first cut for the new Ministry of Truth since many of them have published articles that raised questions about the accuracy of claims made by the U.S. State Department or they have expressed the belief that there may be two sides to complex issues – when Americans are supposed to hear only the side that Official Washington wants them to hear.

    Some of these “Russian propaganda” Web sites – prior to the Iraq War – even raised doubts about the U.S. government’s certainty that Saddam Hussein had stockpiles of WMDs. Thank goodness the Internet wasn’t as widely used back then or perhaps many Americans would have doubted the truth-telling by The New York Times and The Washington Post, which dutifully passed on the U.S. government’s pronouncements about Hussein’s secret WMDs.

    Surely, in 2002-03, the Russians must have been behind the resistance by those few Web sites to the WMD group think that all the respectable people just knew to be true. How else can you explain the skepticism? And maybe Russia was responsible for the U.S. government’s failure to find any of those WMD stockpiles. Curse you, Russia!

    With the Senate Intelligence Committee’s hearing on Thursday, this determination to squelch any dissenting American views as “Russian disinformation” moved up a notch, beyond some think-tank chatter, some newspaper articles or some initial planning for private-sector censorship.

    The craziness has now become the focus of an official Senate investigation into Russian “meddling” in American political life. We have taken another step down the path of a New Cold War that blends a New McCarthyism with a New Orwellianism.

  • Australia Has The World's Worst Money-Laundering Property Market

    Authored by Leith van Onselen via MacroBusiness.com.au,

    Transparency International has released a new report, entitled Doors Wide Open: Corruption and Real Estate in Four Key Markets, which has identified Australia, Canada, the UK and the USA as the top four spots targeted by corrupt officials or criminals for real estate crime. 

    Australia is the worst, failing to address 10-out-of-10 loopholes.

    Below are the key extracts:

    The real estate market has long provided a way for individuals to secretly launder or invest stolen money and other illicitly gained funds… According to the Financial Action Task Force (FATF), real estate accounted for up to 30 per cent of criminal assets confiscated worldwide between 2011 and 2013…

     

    In many such cases, property is purchased through anonymous shell companies or trusts without undergoing proper due diligence by the professionals involved in the deal. The ease with which such anonymous companies or trusts can acquire property and launder money is directly related to the insufficient rules and enforcement practices in attractive markets…

     

    This assessment identifies the following 10 main problems that have enabled corrupt individuals and other criminals to easily purchase luxurious properties anonymously and hide their stolen money in Australia, Canada, the UK and the US:

    1. Inadequate coverage of anti-money laundering provision
    2. Identification of the beneficial owners of legal entities, trusts and other legal arrangements is still not the norm
    3. Foreign companies have access to the real estate market with few requirements or checks
    4. Over-reliance on due diligence checks by financial institutions leads to cash transactions going unnoticed
    5. Insufficient rules on suspicious transaction reports and weak implementation
    6. Weak or no checks on politically exposed persons and their associates
    7. Limited control over professionals who can engage in real estate transactions: no “fit and proper” test
    8. Limited understanding of and action on money laundering risks in the sector
    9. Inconsistent supervision
    10. Lack of sanctions

     

    Australia has severe deficiencies under all 10 areas identified in the research and is therefore not in line with any of the commitments to tackle corruption and money laundering in real estate made in international forums.

     

    In Australia, real estate agents are not subject to the provisions of the Anti-Money Laundering and CounterTerrorism Financing Act 2006. Other professionals such as lawyers and accountants who may also play a role in the sector are not covered either. This means that properties can be bought and sold without any due diligence on the parties. Currently there are no requirements for real estate agents or any professional involved in real estate deals to submit STRs, even if they suspect illegal activity is taking place, and there are no requirements or rules for verifying whether customers are PEPs or their close associates…

     

    In Australia, Canada and the US, the current anti-money laundering framework shows a tendency to rely on financial institutions to conduct the necessary background checks on real estate transactions… there are no checks on cash transactions.

     

    In Australia, 70 per cent of Chinese buyers pay in cash and they represent the largest proportion of foreign purchases in the country.

    What a complete and utter disgrace. Legislation to implement the second tranche of anti-money laundering (AML) legislation covering real estate gate keepers has been gathering dust for nearly a decade despite explicit criticism from the global regulator, the Paris-based Financial Action Taskforce (FATF), that Australian homes are a haven for laundered funds, particularly from China, as well as similar warnings from Austrac.

    In the meantime, dodgy Chinese money has piled into Australian property, in the process inflating house prices and pricing young Australians out of home ownership.

    When will Australia’s politicians finally take action and end more than a decade of neglect by bringing Australia’s real estate gatekeepers into the AML net – as demanded by FATF and Austrac, promised by the federal government in 2003, and intended when the AML legislation was first drafted in 2006?

    Or will the Australian Government continue to turn a blind eye to the dirty foreign money flooding into Australian property?

  • Matt Drudge In Rare On Air Appearance Declares: 'Trump Saved the Media'

    Celebrating Michael Savage’s 75th birthday, Matt Drudge, founder of the largest news aggregator site in the world, DrudgeReport.com, paid him a surprise visit and guest hosted for a short while, fielding some calls and offering his opinion on the ongoing struggle between Trump versus the world.

    Almost begrudgingly, Drudge declared that Trump, single handedly, saved the main stream media from death spiraling amidst catastrophic ratings — thanks to public disinterest. Because of Trump, Drudge believes, the opposition has ‘consolidated’, ‘following every bouncing ball’, which has created a revitalization in the media not seen in years.

    “I’m getting a little bit nervous about the media situation. Do you know, the media was near death. The New York Times was hanging on the short hairs. Do you know Vanity Fair was going under. CNN barely had a fraction,” Drudge said during an appearance on Michael Savage’s radio show.

     
    Trump saved media

    //platform.twitter.com/widgets.js

     
    Case in point, the share prices for all of the major media companies are sharply higher this year.

    Being a provider of both financial and political news, I can tell you, first hand, our finance traffic pales in comparison to the political stuff. People are simply transfixed by this administration, because the man, Donald Trump, love him or hate him, is a lightening rod for controversy. We’re living through a reality show, the White House edition, and the media loves it.

    Drudge also touched on Twitter, suggesting their audience is inflated and not that big. Largely, it’s an echo chamber for junkies.

    Twitter’s audience isn’t that big. It’s for junkies.

    //platform.twitter.com/widgets.js

    Lastly, he cited recent Rasmussen poll numbers that showed Trump with a 44% approval rating. He said he trusted Rasmussen and that the bad polling data was ‘a danger’ for Trump and a consequence of having been dealt a bad hand, with everyone working in concert against the President. Drudge believes taking some time away from the limelight would do the President some good, judging the tree by the fruit it produces.

    Drudge is worried about Trump’s poll numbers.

    //platform.twitter.com/widgets.js

    Here’s the full clip.

    Content originally generated at iBankCoin.com

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Apr 01

Today’s News 1st April 2017

  • Multiple Bubbles Are Going To Bring America To Its Knees: "The Warning Signs Are There"

    Authored by Daniel Lang via SHTFplan.com,

    If you’ve been paying attention to the ongoing degradation of the American economy since the last financial crisis, you’re probably flabbergasted by the fact that our economy has managed to make it this far without imploding. I know I am. I find myself shocked with every year that passes without incident.

    The warning signs are there for anyone willing to see, and they are flashing red. Even cursory research into the numbers underlying our system will tell you that we’re on an unsustainable financial path. It’s simple math. And yet the system has proven far more durable than most people thought.

    The only reasonable explanation I can think of, is that the system is being held up by wishful thinking and willful ignorance. If every single person knew how unsustainable our economy is, it would self-destruct within hours. People would pull their money out of the banks, the bonds, and the stock market, and buy whatever real assets they could while their money is still worth something. It would be the first of many dominoes to fall before the entire financial system collapses.

    But most people don’t want to think about that possibility. They want the relative peace and prosperity of the current system to continue, so they ignore the facts or try to avoid them as much as possible. They keep their money right where it is and cross their fingers instead. In other words, the only thing propping up the system is undeserved confidence.

    Unfortunately, confidence can’t keep an unsustainable system running forever. Nothing can. And our particular system is brimming with economic bubbles that aren’t going to stay inflated for much longer. Most recessions are associated with the bursting of at least one kind of bubble, but there are multiple sectors of our economy that may crash at roughly the same time in the near future. For instance:

    • Eric Rosengren, the president of the Federal Reserve Bank of Boston, recently made a startling tacit admission. We may be in the midst of yet another real estate bubble. Major financial institutions in this country are in possession of over $14 trillion worth of residential real estate loans. That’s well over $40,000 for every man woman and child in America.
    • Low interest rates have fueled a bubble in subprime auto loans, and that bubble appears to be reaching its limits. There are now over 1 million ordinary and subprime auto loans that are delinquent, a number that hasn’t been this high since 2009.
    • There is now well over a trillion dollars worth of student loan debt in this country; much of it owned by low income families. And there’s little hope that these students will ever see a return on their investment. That’s why at least 27% of student loans are in default. While more than one in four students are in default now, that number was one in nine a decade ago. And if current trends continue, there could be $3.3 trillion of student loan debt by the end of the next decade. Clearly, this isn’t going to go on for much longer.
    • And who could forget the stock market? Despite experiencing low GDP growth every year since the last recession, the stock market continues to break new records. Many of the companies on the stock market (especially tech companies), have a market cap that is between 20 and 100 times their sales or earnings numbers. Some are much higher, despite experiencing slow growth, or even no profits at all.

    Our economy is awash in cheap money and financial bubbles that threaten to wipe out tens of trillions of dollars worth of savings, investments, and assets. Everyone can close their eyes and hum while they hope that everything is going to be just fine, but it won’t be.

    I said before that if everyone knew how unsustainable this economy is, it would all come crashing down. But they’re going to find out one way or another when it comes crashing down anyway. Hope and confidence can only prop up a bubble-ridden economy for so long.

  • California Senator Forced To Pull Bill Banning "Fake News" After Realizing It's Idiotic

    California is known far and wide for it’s wacky regulations.  In fact, just last fall we wrote about SB 1383, a very significant piece of legislation signed into law by Jerry Brown which requires a 40% reduction in methane gas emissions from cow flatulence by 2030 (no, really…you can take a look here: “Here Are Some Of The Ridiculous New State Laws That Will Take Effect January 1st – Happy New Year!“)

    But a recent piece of legislation introduced by California Assemblyman Ed Chau (D-Monterey Park), “The California Political Cyberfraud Abatement Act or AB 1104 for short, gives the “cow fart” bill a run for its money in terms of its complete idiocy.  The bill, filed Wednesday in the Assembly’s Committee on Privacy and Consumer Affairs, would have effectively made it a crime to be wrong on the Internet.

    The text of the bill implicated anyone who writes, publishes or even shares news stories that could be false, if those news stories are later found to have had an impact on an election.  From the bill:

    This bill would modify the definition of the terms “political cyberfraud” and “political Web site” to include Internet Web sites that urge or appear to urge the support or opposition of candidates for public office. The bill would also make it unlawful for a person to knowingly and willingly make, publish or circulate on a Web site, or cause to be made, published, or circulated in any writing posted on a Web site, a false or deceptive statement designed to influence the vote on any issue submitted to voters at an election or on any candidate for election to public office.

    And even though author Ed Chau described AB 1104 as “an important step forward in the fight against ‘fake news’ and deceptive campaign tactics”, the Electronic Frontier Foundation (EFF), a digital-rights advocacy group, said the bill was “so obviously unconstitutional, we had to double check that it was real.”

    Memo to California Assemblymember Ed Chau: you can’t fight fake news with a bad law.

     

    On Tuesday, the California Assembly’s Committee on Privacy and Consumer Affairs, which Chau chairs, will consider A.B. 1104—a censorship bill so obviously unconstitutional, we had to double check that it was real.

     

    This bill will fuel a chaotic free-for-all of mudslinging with candidates and others being accused of crimes at the slightest hint of hyperbole, exaggeration, poetic license, or common error. While those accusations may not ultimately hold up, politically motivated prosecutions—or the threat of such—may harm democracy more than if the issue had just been left alone. Furthermore, A.B. 1104 makes no exception for satire and parody, leaving The Onion and Saturday Night Live open to accusations of illegal content. Nor does it exempt news organizations who quote deceptive statements made by politicians in their online reporting—even if their reporting is meant to debunk those claims. And what of everyday citizens who are duped by misleading materials: if 1,000 Californians retweet an incorrect statement by a presidential candidate, have they all broken the law?

     

    At a time when political leaders are promoting “alternative facts” and branding unflattering reporting as “fake news,” we don’t think it’s a good idea to give the government more power to punish speech.

    As of right now it looks as if the legislation has been pulled after Chau just cancelled a hearing originally scheduled for Monday.  Presumably Chau got a little pushback from mainstream media outlets after they realized his bill would effectively ban them, and their fake “Russian hacking” narratives from California.

    Here is the full text of the bill for your reading pleasure: 

  • Caught On Tape In Atlanta: "State Of Emergency, The Entire Bridge Is Compromised"

    Authored by Mac Slavo via SHTFplan.com,

    If you were looking for confirmation that the nation’s infrastructure needs a complete overhaul, a collapsing bridge in Atlanta may have provided it in stark imagery.

    Around 6:30 p.m. Thursday night, a fire broke out under a section of the highway bridge on busy I-85 in Atlanta, Georgia. Just thirty minutes later, a huge section of that bridge burst into flames and completely collapsed.

    Amazingly, no motorists were injured when this happened:

    “This is as serious a transportation crisis as we could have,” Mayor Kasim Reed said, noting that he had spoken with the FBI and terrorism was not suspected at this time.

    Authorities still don’t know what exactly caused the fire as the entire area is still too unsafe for crews to examine, but it is believed that PVC piping stored under the bridge (as shown on a screen capture from Google maps below) caught fire first.

    screen-shot-2017-03-31-at-5-01-06-am

    Georgia Governor Nathan Deal has declared a state of emergency, however, as authorities claim the entire transportation network in Atlanta has been significantly impacted, including five different public bus lines. In addition, DeKalb County Schools were canceled Friday, City of Atlanta government offices won’t open until 10 am, and all non-essential DeKalb County government workers will not be required to report in to work.

    City officials have no idea when the bridge in what is otherwise a heavy traffic area will be able to be fixed.

    In other words, traffic is going to be a bitch.

    Meanwhile, how’s that aging American infrastructure working out?

  • 'Russiagate' Is Failing And Its Supporters Are Getting Concerned

    Submitted by Alexander Mercouris of The Duran

    ‘Russiagate’ is failing and its supporters are getting worried

    Three weeks ago I wrote a piece for The Duran in which I suggested that the corner appeared to have been turned in the fake ‘Russiagate’ scandal.

    What was a tentative conclusion then can now be firmed up.

    Though the leaders of the US security services have denied the President’s allegation that they wire-tapped him – though they were careful not to deny that they mounted surveillance on him and his associates – the President’s claim that they did, in effect smoked them out.

    Thus former DNI James Clapper admitted that he had seen no evidence of collusion between the Trump campaign and the Russians up to the point of his retirement on 20th January 2017, and former Acting CIA Director Michael Morell more recently has publicly trashed the whole story of collusion between the Trump campaign and Russia.

    Possibly the single most important admission that no evidence of collusion between the Trump campaign and the Russians has been found came however from within the FBI itself, though it has gone almost completely unnoticed.

    This came in the form of information deriving from an anonymous leak which appeared in an article in The New York Times on 5th March 2017.  This leak almost certainly originated with FBI Director James Comey himself.  The relevant sentence in the article reads as follows

    In addition to being concerned about potential attacks on the bureau’s credibility, senior F.B.I. officials are said to be worried that the notion of a court-approved wiretap will raise the public’s expectations that the federal authorities have significant evidence implicating the Trump campaign in colluding with Russia’s efforts to disrupt the presidential election.

    (bold italics added)

    In my article of 6th March 2017 discussing this comment I said the following

    This is very twisted language which shows that The New York Times is not reporting this part of the story straightforwardly.  However the meaning is clear enough.  The FBI is worried that the more discussion of its investigation there is – extending all the way to discussions by no less a person than the President himself of court approved wiretaps – the more people will fall for the false ‘no smoke without fire’ argument, and will feel let down by the FBI when it eventually announces that its investigation has drawn a blank.

     

    This is an entirely valid concern, and is one of several reasons why such investigations are supposed to be confidential.

     

    This is the second confirmation within a few hours from people who have held posts within the national security bureaucracy that the endlessly repeated claims of collusion between the Trump campaign and Russia are not supported by evidence.  The first was made by Clapper (see above) and the second was made anonymously to The New York Times by officials of the FBI.

     

    These admissions follow a continuous pattern of admissions from officials within the national security bureaucracy now stretching back months that inquiries into claims of collusion by the Trump campaign and Russia are drawing a blank.

    A further sign that the ‘Russiagate’ scandal is flagging is the way its supporters are latching on to non issues in order to keep it going.

    Thus following the House Intelligence Committee hearing on Monday 20th March 2017 the militantly anti-Trump news media latched on to FBI Director Comey’s formal confirmation that an FBI investigation was looking into the allegation of collusion between the Trump campaign and Russia, as if this was news, and made it the big story, even though the existence of this investigation has been public knowledge and the topic of exhaustive discussion in the media for months.

    No doubt this was done in order to avoid mentioning the fact that the Committee on 20th March 2017 heard no evidence even slightly damaging to the President, but did hear evidence which appeared to confirm the truth of the President’s claim that he and his campaign team had been placed under surveillance during the most critical months of the Presidential election campaign.

    Then there was the way Representative Adam Schiff used in his opening statement at the Committee hearing the discredited ‘Trump Dossier‘ – shot through with obvious falsehoods, uncorroborated by the intelligence agencies, and trashed by no less a person than Michael Morell – as his frame story for his whole narrative of secret collusion between the Trump campaign and Russia.  This is desperate, and shows how evidence-less and fact-free the whole ‘Russiagate’ story actually is.

    Then there are the claims – almost certainly originating in Ukraine – about the supposedly nefarious activities of Donald Trump’s former campaign chair Paul Manafort.

    Not only have these claims been emphatically and authoritatively denied by the two people involved – Manafort and Deripaska – with Manafort asking to give evidence to the House Intelligence Committee to put the record straight and Deripaska threatening to sue anyone who repeats them, but since they involve alleged actions which took place years before Donald Trump launched his Presidential campaign, and have no connection to him, their relevance to the ‘Russiagate’ scandal is not obvious.

    Lastly, there is the wholly bogus non-scandal around House Intelligence Committee chair Devin Nunes, who is obviously being targeted by the Democrats because of his increasingly openly expressed and entirely justified skepticism about the whole ‘Russiagate’ story.

    To be clear, Nunes’s decision to share information about surveillance of the President and his team during the transition period with the White House before he shared it with his Committee colleagues was no doubt a mistake – and one which Nunes has apologised for – but it is hardly a serious one, or one which would justify removing him from his chairing of the Committee.

    To my mind what this episode shows is how sensitive the Democrats are about the raising of the whole surveillance issue.  This lends further strength to my opinion – which I note is coming to be increasingly widely shared – that it is the surveillance carried out during the election of Donald Trump and his campaign team which is the real scandal in this affair, and that the fake ‘Russiagate’ scandal is the smoke-screen concealing it.

    Having increasingly given up on the House Intelligence Committee, the proponents of the ‘Russiagate’ scandal now seem increasingly to be resting their hopes on the Senate Intelligence Committee.

    They will be equally disappointed there.  These attempts to use Congressional committees as investigative and prosecutorial instruments suffer from a basic misconception: these are oversight committees, not investigative or prosecutorial committees, and they cannot be used in that way.  They cannot magic up evidence of collusion between the Trump campaign and Russia that the actual investigation – the one carried out by the FBI – says is not there.

    The single most important fact about the last few weeks, and the clearest possible sign that the ‘Russiagate’ scandal is flagging, is that there have been no more leaks from within the intelligence and security agencies since the ones at the beginning of March about Jeff Sessions’s meetings with the Russian ambassador.

    That suggests that the former Obama administration officials, who I suspect were the people who were physically communicating the information in the leaks to the media, are no longer being fed  information about Donald Trump and his associates or about the progress of the FBI investigation by their sources within the intelligence and national security bureaucracy.

    That could be because people within the intelligence and national security bureaucracy are being deterred by the investigation into the leaking of classified material which the President has been calling for but which the House Intelligence Committee hearing on 20th March 2017 suggested FBI Director Comey is resisting (almost certainly because people within the FBI were involved in the leaks), or it could be because increasingly there is no damaging information to leak.

    Regardless of what the explanation is, in the absence of any more leaks there has been nothing over the last few weeks for the supporters of ‘Russiagate’ to work with.  The result is that in the absence of anything new the effort to keep the ‘Russiagate’ scandal going and in the public eye is flagging.

    My best guess is that it will collapse entirely by early summer.

  • American Jobs Once Again Flowing Into Mexico After Brief, Trump-Induced Pause

    After Ford scrapped plans for a new facility in Mexico and continues to flood the White House with press releases detailing normal course capital expenditures to be made on domestic plants, investments that would have been made irrespective of their outsourcing ambitions, it seems as though economics are making a comeback in  guiding the capital allocations of other companies as ‘outsourcing’ is once again picking up steam among American companies.

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    As Bloomberg points out today, after a brief pause, consultants who help American companies relocate to Mexico are once again finding themselves flush with business.

    But now the pace is picking back up. Illinois Tool Works Inc. will close an auto-parts plant in Mazon, Illinois, this month and head to Ciudad Juarez. Triumph Group Inc. is reducing the Spokane, Washington, workforce that makes fiber-composite parts for Boeing Co. aircraft and moving production to Zacatecas and Baja California. TE Connectivity Ltd. is shuttering a pressure-sensor plant in Pennsauken, New Jersey, in favor of a facility in Hermosillo.

     

    While Trump hasn’t stopped pounding his America First bully pulpit, and the future of Nafta remains uncertain, “there’s cautious optimism and a hopeful attitude that cooler heads will prevail in Washington,” said Ross Baldwin, chief executive officer of Tacna Services Inc., which facilitates relocations.

     

    Baldwin has seen the evidence: After business ground to a halt back in November, he’s now juggling two Mexico-bound clients. San Diego-based Tacna helps manage 4,500 workers in Mexico, where factory wages are about a fifth of those in the U.S. That may explain why Mexican manufacturing jobs rose 3.2 percent in January from a year ago as they dropped 0.3 percent in the U.S.

    In the end, of course, the massive wage divide between the U.S. and Mexico means that, even with a border tax, it’s still cheaper to manufacture certain products in Mexico.

    Mexico

     

    Moreover, we suspect that the renewed wave of outsourcing has been sparked, at lease in part, by Trump’s early failures to implement healthcare reform or impose his travel ban as companies grow increasingly comfortable that an import tariff will be harder to implement than the President once thought.

    Businesses haven’t dismissed a Nafta renegotiation or policies being considered in Washington that might prove costly. A plan by House Republicans to implement a 20 percent border adjustment tax has raised concerns, especially among retailers such as Wal-Mart Stores Inc. that import many of their wares. The tax would be applied to sales of imported goods to reduce the U.S. trade deficit, which reached $734 billion in 2016.

     

    Trump repeated to a joint session of Congress last month his refrain that that he will make it “much, much harder for companies to leave our country.” But his recent stumbles — travel bans blocked by courts and a health-care bill scuttled by his own party — underscore the limitations on presidential power and the difficulty he may have punishing companies or overhauling Nafta.

    While shocking, we suspect it’s simply never going to make sense to pay a UAW worker a fully-loaded wage $70 an hour to perform a low-skill task that someone else will do for less than $5 per hour.

  • Buchanan Asks "Is Putin The 'Preeminent Statesman' Of Our Times?"

    Authored by Patrick Buchanan via Buchanan.org,

    “If we were to use traditional measures for understanding leaders, which involve the defense of borders and national flourishing, Putin would count as the preeminent statesman of our time.

     

    “On the world stage, who could vie with him?”

    So asks Chris Caldwell of the Weekly Standard in a remarkable essay in Hillsdale College’s March issue of its magazine, Imprimis.

    What elevates Putin above all other 21st-century leaders?

    “When Putin took power in the winter of 1999-2000, his country was defenseless. It was bankrupt. It was being carved up by its new kleptocratic elites, in collusion with its old imperial rivals, the Americans. Putin changed that.

     

    “In the first decade of this century, he did what Kemal Ataturk had done in Turkey in the 1920s. Out of a crumbling empire, he resurrected a national-state, and gave it coherence and purpose. He disciplined his country’s plutocrats. He restored its military strength. And he refused, with ever blunter rhetoric, to accept for Russia a subservient role in an American-run world system drawn up by foreign politicians and business leaders. His voters credit him with having saved his country.”

    Putin’s approval rating, after 17 years in power, exceeds that of any rival Western leader. But while his impressive strides toward making Russia great again explain why he is revered at home and in the Russian diaspora, what explains Putin’s appeal in the West, despite a press that is every bit as savage as President Trump’s?

    Answer: Putin stands against the Western progressive vision of what mankind’s future ought to be. Years ago, he aligned himself with traditionalists, nationalists and populists of the West, and against what they had come to despise in their own decadent civilization.

    What they abhorred, Putin abhorred. He is a God-and-country Russian patriot. He rejects the New World Order established at the Cold War’s end by the United States. Putin puts Russia first.

    And in defying the Americans he speaks for those millions of Europeans who wish to restore their national identities and recapture their lost sovereignty from the supranational European Union. Putin also stands against the progressive moral relativism of a Western elite that has cut its Christian roots to embrace secularism and hedonism.

    The U.S. establishment loathes Putin because, they say, he is an aggressor, a tyrant, a “killer.” He invaded and occupies Ukraine. His old KGB comrades assassinate journalists, defectors and dissidents.

    Yet while politics under both czars and commissars has often been a blood sport in Russia, what has Putin done to his domestic enemies to rival what our Arab ally Gen. Abdel-Fattah el-Sissi has done to the Muslim Brotherhood he overthrew in a military coup in Egypt?

    What has Putin done to rival what our NATO ally President Erdogan has done in Turkey, jailing 40,000 people since last July’s coup — or our Philippine ally Rodrigo Duterte, who has presided over the extrajudicial killing of thousands of drug dealers?

    Does anyone think President Xi Jinping would have handled mass demonstrations against his regime in Tiananmen Square more gingerly than did President Putin this last week in Moscow?

    Much of the hostility toward Putin stems from the fact that he not only defies the West, when standing up for Russia’s interests, he often succeeds in his defiance and goes unpunished and unrepentant.

    He not only remains popular in his own country, but has admirers in nations whose political establishments are implacably hostile to him.

    In December, one poll found 37 percent of all Republicans had a favorable view of the Russian leader, but only 17 percent were positive on President Barack Obama.

    There is another reason Putin is viewed favorably. Millions of ethnonationalists who wish to see their nations secede from the EU see him as an ally. While Putin has openly welcomed many of these movements, America’s elite do not take even a neutral stance.

    Putin has read the new century better than his rivals. While the 20th century saw the world divided between a Communist East and a free and democratic West, new and different struggles define the 21st.

    The new dividing lines are between social conservatism and self-indulgent secularism, between tribalism and transnationalism, between the nation-state and the New World Order.

    On the new dividing lines, Putin is on the side of the insurgents. Those who envision de Gaulle’s Europe of Nations replacing the vision of One Europe, toward which the EU is heading, see Putin as an ally.

    So the old question arises: Who owns the future?

    In the new struggles of the new century, it is not impossible that Russia — as was America in the Cold War — may be on the winning side. Secessionist parties across Europe already look to Moscow rather than across the Atlantic.

    “Putin has become a symbol of national sovereignty in its battle with globalism,” writes Caldwell. “That turns out to be the big battle of our times. As our last election shows, that’s true even here.”

  • The Divergence Between 'Hard' & 'Soft' Data Explained (And Republican Bulls Won't Like It)

    Another dataset, another head-scratching disparity between ostensibly fulsome confidence and evidently sluggish activity.  While markets get whipsawed reacting to divergent hard and soft data points, the question that traders need to ask is whether this gap makes any sense.

    Bloomberg's Macro Strategist Cameron Crise may have the answer… If you're willing to believe that survey respondents allow their political beliefs to color their answers, then it very well might.

    I modeled U.S. economic growth since 1975 using the softest of the soft data releases: consumer confidence and the small business optimism survey. I omitted the ISM because it includes factual questions, i.e. are orders increasing?  The fit is actually pretty good for such a simple model, with an r-squared of 0.51.  As you can see, the model is now pretty upbeat.

     

     

    I then disaggregated the data and compared the model forecast to actual economic growth for each president since Gerald Ford. The results were fascinating.

    • Under Republican presidencies, average annual growth has been 2.7%…but the model has forecast it at 3%.
    • Under Democrats, growth has been a little higher, at 2.8%…but the model has forecast growth of just 2.3%.

     

     

    In fact, the model slightly underestimated growth during the Ford and Reagan years. Since George HW Bush, however, the trend is pretty pronounced: survey respondents have been optimistic relative to underlying growth for GOP presidents and pessimistic relative to growth for their Democratic counterparts.

     

    It seems likely that at least some of the recent boost to confidence is evidence of the same phenomenon manifesting itself.  That being said, the model currently projects growth of nearly 3.5%, so even if we were to knock off the usual half a percent for a post-Reagan GOP presidency that would still imply a marked uptick over the post-crisis run rate.

     

    Of course, achieving that growth will probably be contingent on the government enacting some of its more business-friendly campaign promises such as tax reform or deregulation. If they don't, then the "optimism gap" may close, and not in a way that the White House might like.

     

    Either way, traders will need to keep an eye on government policy and its implications. The efficacy of the Trump administration may not matter on a day-to-day basis for bond markets, but in the long run it probably will.

    A glance at the last 20 years or so of 'soft' and 'hard' data also helps confirm this over-confidence… it's the hope that pumps… then dumps… and never the reality that jumps…

  • Intel Official Behind "Unmasking" Of Trump Associates Is "Very Senior, Very Well Known"

    Day after day, various media outlets, well really mostly the NYT and WaPo, have delivered Trump-administration-incriminating, Russia-link-related tape bombs sourced via leaks (in the hope of keeping the narrative alive and "resisting."). It now turns out, according to FXN report, that the US official who "unmasked" the names of multiple private citizens affiliated with the Trump team is someone "very well known, very high up, very senior in the intelligence world."

    As Malia Zimmerman and Adam Housley report, intelligence and House sources with direct knowledge of the disclosure of classified names (yes, yet another "unnamed source") said that House Intelligence Committee Chairman Devin Nunes, now knows who is responsible – and that person is not in the FBI (i.e. it is not James Comey)

    Housley said his sources were motivated to come forward by a New York Times report yesterday which reportedly outed two people who helped Nunes access information during a meeting in the Old Executive Office Building. However, Housley’s sources claim the two people who helped Nunes "navigate" to the information were not his sources. In fact, Nunes had been aware of the information since January (long before Trump's 'wiretap' tweet) but had been unable to view the documents themselves because of "stonewalling" by the agencies in question.

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    http://video.foxnews.com/v/embed.js?id=5380606763001&w=466&h=263

    Watch the latest video at video.foxnews.com

    For a private citizen to be “unmasked,” or named, in an intelligence report is extremely rare. Typically, the American is a suspect in a crime, is in danger or has to be named to explain the context of the report.

    “The main issue in this case, is not only the unmasking of these names of private citizens, but the spreading of these names for political purposes that have nothing to do with national security or an investigation into Russia’s interference in the U.S. election,” a congressional source close to the investigation told Fox News.

    The White House, meanwhile, is urging Nunes and his colleagues to keep pursuing what improper surveillance and leaks may have occurred before Trump took office. They’ve been emboldened in the wake of March 2 comments from former Obama administration official Evelyn Farkas, who on MSNBC suggested her former colleagues tried to gather material on Trump team contacts with Russia.

    White House Press Secretary Sean Spicer said Friday her comments and other reports raise “serious” concerns about whether there was an “organized and widespread effort by the Obama administration to use and leak highly sensitive intelligence information for political purposes.”

    “Dr. Farkas’ admissions alone are devastating,” he said.

    Clearly this confirms what Evelyn Farakas said, accidentally implicated the Obama White House in the surveillance of Trump's campaign staff:

    The Trump folks, if they found out how we knew what we knew about the Trump staff dealing with Russians, that they would try to compromise those sources and methods, meaning we would not longer have access to that intelligence.

    Furthermore, Farkas effectively corroborated a New York Times article from early March which cited "Former American officials" as their anonymous source regarding efforts to leak this surveillance on the Trump team to Democrats across Washington DC.

    * * *

    In addition, citizens affiliated with Trump’s team who were unmasked were not associated with any intelligence about Russia or other foreign intelligence, sources confirmed. The initial unmasking led to other surveillance, which led to other private citizens being wrongly unmasked, sources said.

    "Unmasking is not unprecedented, but unmasking for political purposes … specifically of Trump transition team members … is highly suspect and questionable,” according to an intelligence source. “Opposition by some in the intelligence agencies who were very connected to the Obama and Clinton teams was strong. After Trump was elected, they decided they were going to ruin his presidency by picking them off one by one."

    * * *

    So if the source isn't Comey, has anyone seen Jim Clapper recently? The answer should emerge soon, meanwhile the ridiculous game with very high stakes of spy vs spy, or in this case source vs source, continues.

    The report summarized below in video format:

    http://video.foxnews.com/v/embed.js?id=5380606763001&w=500&h=281

    Watch the latest video at video.foxnews.com

  • How Chicago's Largest Pension May Run Out Of Cash In As Little As 4 Years

    Chicago’s pension funds, along with several other large public pensions around the country, are in serious trouble (we recently discussed the destruction awaiting our financial markets here: “Are Collapsing Pensions “About To Bring Hell To America”?“). 

    The problem is that the pending doom surrounding these massive public pension obligations often get clouded over by complicated actuarial math with a plan’s funded status heavily influenced by discount rates applied to future liability streams. 

    Take Chicago’s largest pension fund, the Municipal Employees Annuity and Benefit Fund of Chicago (MEABF), as an example.  Most people focus on a funds ‘net funded status’, which for the MEABF is a paltry 20.3%.  But the problem with focusing on ‘funded status’ is that it can be easily manipulated by pension administrators who get to simply pick the rate at which they discount future liabilities out of thin air.

     

    So, rather than lend any credence to some made up pension math, we prefer to focus on actual pension cash flows which can’t be manipulated quite so easily. 

    And a quick look at MEABF’s cash flows quickly reveals the ponzi-ish nature of the fund.  In both 2015 and 2014, the fund didn’t even come close to generating enough cash flow from investment returns and contributions to cover it’s $800mm in annual benefit payments…which basically means they’re slowing liquidating assets to pay out liabilities.

     

    Of course, like all ponzi schemes, liquidating assets to pay current claims can only go on for so long before you simply run out of assets. 

    So we decided to take a look at when Chicago’s largest pension fund would likely run out of money.

    On the expense side, annual benefit payments are currently just over $800 million and are growing at a fairly consistent pace due to an increasing number of retirees and inflation adjustments guaranteed to workers.  Assuming payouts continue to grow at the same pace observed over the past 15 years, the fund will be making annual cash payments to retirees of around $1.3 billion by 2023.

     

    Investment returns, on the other hand, are much more volatile but have averaged 5.5% over the past 15 years.  That said, the fund took big hits in 2002 (-9.3%) and 2008 (-27.1%) following the dotcom and housing bubble crashes. 

    But, just to keep it simple, lets assume that today’s market is not a massive fed-induced bubble and that the MEABF is able to produce consistent 5.5% (their 15-year average) returns every year in perpetuity.  Even then, the fund will only generate roughly $500mm per year in income compared to benefit payments growing to $1.3 billion…see the problem?

     

    Which, of course, means that the fund has likely just entered a period of perpetual cash outflows which will not stop until either (i) the city decides to cut back retiree payments or (ii) the fund runs out of money.

     

    And, putting it all together, even if Chicago’s largest pension generates consistent positive returns for the foreseeable future, it will literally run out of cash in roughly 6 years.

     

    And while we hate to be pessimistic, lets just take a look at what happens if, by some small chance, today’s market gets exposed as a massive bubble and we have another big correction in 2018.

    Such a correction would force the fund to liquidate over $1.5 billion in assets in 2018 alone….

     

    ….and the system would run out of cash completely within 4 years.

     

    The risk associated with America’s pension ponzi schemes have largely been overlooked by investors to date because so long as they can meet annual benefit payments then plan administrators can just continue to ‘kick the can down the road’ and pretend that nothing is wrong.   

    Of course, that strategy ceases to work when the pensions actually run out of cash…which could happen sooner than you think…and when it does, America’s retirees will suddenly find themselves about $5 trillion poorer than they thought they were.

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Mar 31

Today’s News 31st March 2017

  • Hispanic-Owned Businesses Dominate Bids For Trump's 'Xenophobic' Border Wall

    Trump’s proposed border wall has been described by many of the left as everything from “xenophobic” to just plain “racist” and pretty much everything in between.  That said, perhaps “equal opportunity employer” would be more accurate in light of a new analysis from the Wall Street Journal that took a look at who has submitted bids to help construct the wall so far…in a little dose of irony for the left, hispanic-owned businesses currently lead the charge with 32 bids.

    More than 200 companies have expressed interest in submitting plans to help design and build a wall along the U.S. border with Mexico, as the Trump administration seeks to fulfill a key campaign promise despite significant obstacles.

     

    The companies, whose names were published on a federal contracting website, vary widely in size and capability—from construction giants like Kiewit Corp. to smaller, family-owned businesses.

     

    Among those interested at this early stage are more than three dozen businesses owned by minorities, a Wall Street Journal analysis shows. Roughly 13% of the companies expected to submit proposals for the wall, for example, are owned by Hispanics.

    Border Wall

     

    One such immigrant-owned business bidding on the border wall is run by Mario Burgos whose father immigrated to the U.S. from Ecuador.

    Mario Burgos,  the son of an immigrant, owns an Albuquerque, N.M., construction logistics company and plans to submit a proposal. He said he viewed the project as more geared toward border security than immigration, and a surefire way to boost employment in job-strapped New Mexico.

     

    “I am not against immigrants by any stretch of the imagination,” said Mr. Burgos, whose father came to the U.S. from Ecuador. “There isn’t a country in the world that doesn’t have borders and doesn’t want to enforce them.”

     

    Mr. Burgos noted that his company, Burgos Group LLC, which holds various defense contracts with federal agencies, has handled projects in southern New Mexico near the border and was familiar with operating in remote, rugged locations.

    Meanwhile the owner of Helix Steel said he’s not worried about the potential political fallout, saying “if fighting for American jobs is wrong, I’ll take that risk.”

    Other interested businesses have niche specialties, like Leesburg, Va.-based Helix Steel. Chief Executive Chris Doran said Helix’s products, which make concrete more resistant to blasts and other stresses, would suit what he called a “massive opportunity.”

     

    Mr. Doran, whose company has about 50 employees, said he wasn’t concerned with fallout from participating in the project. “All I can say is I’m fighting for American jobs, and if fighting for American jobs is wrong, I’ll take that risk,” he said.

    Of course, as we noted last week, just as Trump sent out RFP’s for his impenetrable, yet “aesthetically pleasing”, 30-foot border wall, Mexico’s government warned Mexican companies that it would not be in their best “interests” to participate in the project even though there will be no explicit legal restrictions or sanctions to stop them if they tried.  Per Reuters:

    “We’re not going to have laws to restrict (companies), but I believe considering your reputation it would undoubtedly be in your interest to not participate in the construction of the wall,” said Mexican Economy Minister Ildefonso Guajardo.

     

    “There won’t be a law with sanctions, but Mexicans and Mexican consumers will know how to value those companies that are loyal to our national identity and those that are not,” Guajardo added.

     

    His comments echo those of Mexico’s foreign minister Luis Videgaray, who said on Friday that Mexican companies that see a business opportunity in the wall should “check their conscience” first.

    Seems like the list of ‘racist’ companies in this country is growing very quickly.

  • L.A. To Worsen Housing Shortage With New Rent Controls

    Authored by Ryan McMaken via Mises Institute,

    Los Angeles, home to one of the least affordable housing markets in North America, is now proposing to expand rent control to “fix” its housing problem. 

    As with all price control schemes, rent control will serve only to make housing affordable to a small sliver of the population while rendering housing more inaccessible to most. 

    Specifically, city activists hope that a new bill in the state legislature, AB1506, will allow local governments, Los Angeles included, to expand the number of units covered by rent control laws while also restricting the extent to which landlords can raise rents.

    Unintended Consequences

    Currently, partial rent control is already in place in Los Angeles and landlords there are limited in how much they can raise rents on current residents. However, according to LA Weekly, landlords are free to raise rents to market levels for a unit once that unit turns over to new residents. 

    This creates a situation of perverse incentives that do a disservice to both renters and landlords. Under normal circumstances, landlords want to minimize turnover among renters because it is costly to advertise and fill units, and it’s costly to prepare units for new renters. (Turnover is also costly and inconvenient for renters.) 

    By limiting rent growth for ongoing renters, however, this creates an incentive for landlords to break leases with residents — even residents who the landlords may like — just so the landlords can increase rents for new incoming renters in order to cover their costs of building maintenance and improvements. The only upside to this current regime is that at least this partial loophole still allows for some profit to be made, and thus allows for owners to produce and improve housing some of the time. 

    But, if this loophole is closed, as the “affordable housing” activists hope to do, we can look forward to even fewer housing units being built, current units falling into disrepair, and even less availability of housing for residents.

    Why Entrepreneurs Bring Products to Market

    The reason fewer units will be built under a regime of harsher rent control, is because entrepreneurs (i.e., producers) only bring goods and services to market if they can be produced at a cost below the market price. 

    Contrary to the myth perpetuated by many anti-capitalists, market prices — in this case, rents — are not determined by the cost of producing a good or service. Nor are prices determined by the whims of producers based on how greedy they are or how much profit they’d like to make. 

    In fact, producers are at the mercy of the renters who — in the absence of price controls — determine the price level at which entrepreneurs must produce housing before they can expect to make any profit. 

    However, when governments dictate that rent levels must be below what would have been market prices — and also below the level at which new units can be produced and maintained — then producers of housing will look elsewhere. 

    Henry Hazlitt explains many of the distortions and bizarre incentives that emerge from price control measures: 

    “The effects of rent control become worse the longer the rent control continues. New housing is not built because there is no incentive to build it. With the increase in building costs (commonly as a result of inflation), the old level of rents will not yield a profit. If, as often happens, the government finally recognizes this and exempts new housing from rent control, there is still not an incentive to as much new building as if older buildings were also free of rent control. Depending on the extent of money depreciation since old rents were legally frozen, rents for new housing might be ten or twenty times as high as rent in equivalent space in the old. (This actually happened in France after World War II, for example.) Under such conditions existing tenants in old buildings are indisposed to move, no matter how much their families grow or their existing accommodations deteriorate.”

    Thus, 

    “Rent control … encourages wasteful use of space. It discriminates in favor of those who already occupy houses or apartments in a particular city or region at the expense of those who find themselves on the outside. Permitting rents to rise to the free market level allows all tenants or would-be tenants equal opportunity to bid for space.”

    Rent

     

    Not surprisingly, when we look into the current rent-control regime in Los Angeles, we find that newer housing is exempt, just as Hazlitt might have predicted. Unfortunately, housing activists now seek to eliminate even this exemption, and once these expanded rent controls are imposed, those on the outside won’t be able to bid for space in either new or old housing.

    Newcomers will be locked out of all rent-controlled units — on which the current residents hold a death grip — and they can’t bid on the units that were never built because rent control made new housing production unprofitable. Thus, as rent control expands, the universe of available units shrinks smaller and smaller. Renters might flee to single-family rental homes where rent increases might still be allowed, or they might have to move to neighboring jurisdictions that might not have rent controls in place. 

    In both cases, the effect is to reduce affordability and choice. By pushing new renters toward single-family homes this makes single-family homes relatively more profitable than multifamily dwellings, thus reducing density, and robbing both owners and renters of the benefits of economies of scale that come with higher-density housing. Also, those renters who would prefer the amenities of multifamily communities are prevented from accessing them. Meanwhile, by forcing multi-family production into neighboring jurisdictions, this increases commute times for renters while forcing them into areas they would have preferred not to live in the first place. 

    But, then again, for many local governments — and the residents who support them — fewer multifamily units, lower densities, and fewer residents in general, are all to the good. After all, local government routinely prohibit developers from developing more housing through zoning laws, regulation of new construction, parking requirements, and limitations on density. 

    And these local ordinances, of course, are the real cause of Los Angeles’s housing crisis. Housing isn’t expensive in Los Angeles because landlords are greedy monsters who try to exploit their residents. Housing is expensive because a large number of renters are competing for a relatively small number of housing units. 

    And why are there so few housing units? Because the local governments usually drive up the cost of housing. As this report from UC Berkeley concluded: 

    “In California, local governments have substantial control over the quantity and type of housing that can be built. Through the local zoning code, cities decide how much housing can theoretically be built, whether it can be built by right or requires significant public review, whether the developer needs to perform a costly environmental review, fees that a developer must pay, parking and retail required on site, and the design of the building, among other regulations. And these factors can be significant – a 2002 study by economists from Harvard and the University of Pennsylvania found strict zoning controls to be the most likely cause of high housing costs in California.”

    Contrary to what housing activists seem to think, declaring that rents shall be lower will not magically make more housing appear. Put simply, the problem of too little housing — assuming demand remains the same — can be solved with only one strategy: producing more housing. 

    Rent control certainly won’t solve that problem, and if housing advocates need to find a reason why so little housing is being built, they likely will need to look no further than the city council.

  • Facial Recognition Tech Could Ensnare Millions Of Innocent Americans For Crimes They Didn’t Commit

    Authored by Daniel Lang via SHTFplan.com,

    It’s often the case that new technologies arrive on the scene faster than our society and its legal code can keep up. Sometimes this can be a good thing. For instance, 3D printing allows people to print out unregulated gun parts, thus allowing gun owners to circumvent the onerous laws of our government, which has struggled to come up with new laws to restrict the technology.

    When technology advances at a breakneck pace however, it can also be quite dangerous for our liberties. This is especially true in regards to privacy. If a new technology makes it easy for the government to track us, you can bet that the government is going to take its sweet time updating the legal code in a way that will protect us from surveillance.

    That certainly seems to be the case with facial recognition software. During a recent Congressional Oversight Committee hearing, members of both political parties sounded the alarm on the FBI’s use of the technology, and read the written testimony of Electronic Frontier Foundation senior staff attorney Jennifer Lynch:

    Lynch detailed the stunning scope of the FBI’s photo collection. In addition to collecting criminal and civil mug shots, the agency currently has “memorandums of understanding” with 16 states that mean every driver’s license photo from those states is accessible to the agency—without the drivers’ consent. The FBI also has access to photos from the U.S. State Department’s passport and visa records.

     

    Lynch argued that “Americans should not be forced to submit to criminal face recognition searches merely because they want to drive a car. They shouldn’t have to worry their data will be misused by unethical government officials with unchecked access to face recognition databases. And they shouldn’t have to fear that their every move will be tracked if face recognition is linked to the networks of surveillance cameras that blanket many cities.”

     

    “But without meaningful legal protections, this is where we may be headed,” Lynch stated. “Without laws in place, it could be relatively easy for the government and private companies to amass databases of images of all Americans and use those databases to identify and track people in real time as they move from place to place throughout their daily lives.”

    Spy

     

    All told, law enforcement agencies around the country have access to 400 million photos in facial recognition databases, which are connected to roughly 50% of American adults. Most of these people have never committed a crime, and obviously haven’t given any consent to this.

    At first glance it may sound harmless to be in one of these databases. Movies and TV shows make it sound like this technology can help law enforcement swiftly and precisely nab suspects. So what do you have to fear if you haven’t committed a crime? It turns out that in real life, facial recognition is far from perfect.

    Internal FBI documents obtained in a Freedom of Information Act lawsuit by the nonprofit Electronic Privacy Information Center indicate that the FBI’s own database, called the Next Generation Identification Interstate Photo System, or NGI-IPS, had an acceptable margin of error of 20 percent — that is, a 1-in-5 chance of “recognizing” the wrong person.

     

    And research published in the October 2015 issue of the scientific journal PLOS ONE by researchers at the universities of Sydney and New South Wales in Australia found that the humans who interpret such data build in an extra error margin approaching 30 percent.

    If we ever allow our government to roll out facial recognition cameras on a wider scale, lots of innocent people are going to be hurt. Whether by mistake or by malice, it will become shockingly easy for law enforcement to identify ordinary people as criminals. The surveillance control grid will not only be inescapable, it will be unwieldy and rife with abuse.

    It’s often said that you should never trade freedom for safety. In this case, we wouldn’t receive any kind of safety.

  • Is Public Equity A Broken Concept?

    Submitted by Nick Colas of Convergex

    Is Public Equity A Broken Concept

    David Einhorn’s proposal to GM that it split its stock into dividend and capital appreciation shares got us thinking about the bedrock principles of public equity ownership.  Other catalysts for this examination: recent IPO SNAP’s lack of shareholder voting rights, the reluctance of venture capitalists to list their “Unicorns”, and the dearth of IPOs generally.  The critical question here is “Does the traditional one-size-fits-all model of publicly-held equity still work in a world that increasingly values customization?”  Further, will other social and economic trends force a change in this structure, such as aging demographics in the US population and the investment-heavy nature of major technological developments like autonomous cars, workplace automation, and artificial intelligence?  Bottom line: “public equity” needs to be a fluid concept that responds to the changing needs of both providers and users of capital.

    If it is true that we learn the most from our mistakes, then I would posit that we can glean a lot of useful information from analyzing troubled industries rather than just focusing on commercial “Winners”.  For example, I have studied the US auto industry for the last 25 years as both a sell side and buy side analyst, and more recently in the context of the macro work I do in these notes.  It has been an education that has served me very well, even if the group has historically presented limited long term investment potential.

    Here is a summary of everything I know about this auto industry:

    • Demand is economically sensitive and volatile in major markets like the US, Europe and Japan. Since it takes years to design a new vehicle and that process is expensive, automakers have high fixed costs.  This leads to significant variability in earnings over a typical economic cycle and the threat of bankruptcy in a bad downturn is real.  “Hot” product offerings can mitigate this pressure, but not reliably so.
    • There is too much supply. The auto industry employs a lot of people both in final assembly and in the supply chain.  These tend to be good-paying jobs, which means governments are perennially throwing money at car companies to set up shop in their jurisdiction.  Moreover, those same governments don’t ever want to see a plant close.  This makes capacity very sticky, and in some places like Europe there are still too many auto plants.
    • Those two factors make it very hard to earn a decent return on capital over a cycle. Boom times bring excellent free cash flow, but those earnings are later consumed by the lean years.  As a result of both industry structure (point #2) and company-specific earnings volatility (point #1), public equities in the sector tend to have very low normalized valuations.

    I was therefore intrigued by investor David Einhorn’s proposal, made public today, to split GM’s stock into two pieces: a dividend paying equity and a capital appreciation “stub”.  To be clear, I have no idea if it would improve the company’s equity market valuation.  You can read a description here and see the slide deck from his firm, Greenlight Capital, as well: http://www.zerohedge.com/news/2017-03-28/david-einhorns-presentation-how-gm-can-unlock-between-13-and-38-billion-value

    Einhorn’s proposal got me thinking about the nature of public equity capital.  His thesis is that GM’s equity does not have a clean and distinct ownership base.  Dividend-seeking investors are put off by the company’s share buyback program since it drains cash for purposes they don’t value, and capital appreciation-focused investors would prefer that GM just use all their cash generation to repurchase shares.  Split the stock and the conflict goes away, or so the idea goes.

    Regardless of the merits of the idea for GM, Greenlight’s proposal raises a provocative macro question: “Is a one-size-fits-all equity structure really the best approach to both maximizing corporate value and giving shareholders the types of investments they desire?”  Once you pose the question that way, a raft of other capital market trends pop up:

    • Voting rights. The vast majority of public stocks feature a “One share, one vote” structure of corporate governance. Shareholders can elect Boards, vote on major corporate actions like takeovers and mergers, and lobby for changes in management if they feel the business is being mismanaged.
    • The recent high-profile SNAP IPO had an unusual feature, however: no voting rights at all.  While novel, this is the continuation of a trend among technology companies, which in many prominent cases have dual classes of stock with different voting rights.  The intention here is to limit public shareholders’ traditional rights in favor of management’s/core shareholders’ long term business plans and judgment.
    • Dearth of IPOs. Look at a long term chart of the number of Initial Public Offerings in US markets, and you’ll see a significant decline in the number of new issues from the 1990s to now.  The good times were in the late 1990s, of course, when it was customary to see 30-80 IPOs per month.  Now, that number is more like 10-20.
    • Venture capital’s reluctance to list “Unicorns”.   You might argue that capital markets are simply more selective now and the 1990s IPO cycle was an outlier.  But then why are so many truly revolutionary companies like Airbnb, Uber, Lyft, Palantir, and other “Unicorns” all still private?  These are transformational businesses, but the venture capitalists that fund them see no need to take them public. 

      Now, I am sure that Uber’s shareholders are happy just now that the company isn’t subject to the daily vagaries of the stock market, but on balance the absence of “UBER” as a symbol on the NYSE or the NASDAQ  is troublesome.

    At its core, the social compact between public equity markets and society is simple: over time, any investor should have access to the equity of important enterprises created by that society.  If that isn’t happening by virtue of some misalignment of incentives, then those need to be fixed.  The alternative – that the winners stay private but the losers are public – is untenable.  Investors will choose to hoard cash and capital will slowly stop circulating to its best possible use.

    Given the pace of innovation that seems to be on its way, this problem may only get worse.  If the futurists are correct, there are several societal sea changes just over the horizon, from artificial intelligence to workplace automation to driverless cars, all in various stages of development.  The home for that capital right now too often has a Sand Hill Road address rather than 11 Wall Street.

    We’ve come a long way from what now seems like a pretty humble proposal regarding one car company, so let’s put on bow on all this.  A few summary points:

    • For all the innovation on offer in American industry, the concept of public equity is perhaps overly reliant on an outdated concept where one equity security with proportional voting rights is the only flavor available. It is, at least, a topic worth discussing.
    • Investors, in their role as consumers, are used to custom solutions in every facet of their life – so why not think about how to apportion the value of a company to fit their needs? Yes, equity and debt are the traditional solutions.  But why do you think Exchange Traded Funds are so popular?  In part it is because they target investor needs in creative ways.  Corporate boards and investment bankers might take a page from that book.
    • Demographics and technology may force the issue. An aging US population might embrace novel approaches to accessing the corporate cash flows of public companies.  And if there is a new wave of innovation ready to drop on us, the only nature hedge might be to have access to the equity of those businesses.  Even if they don’t carry voting shares or other traditional features.

    Now, one caveat: all of this needs sufficient regulation to curtail abuse.  The mortgage market of the early 2000s is the cautionary tale here, of course.  Changes to the notion of public equity need careful scrutiny to make sure disclosures are complete and structures are sound.

    But in the end, “Equity” will need to evolve in the same way everything else does in a capitalist society – in a way that serves both investors and users of capital.


  • China Manufacturing PMI Jumps To Five Year High

    China’s reflation story (on the back of a record amount of debt created last year) was put on display on Friday morning when both the Chinese manufacturing and non-manufacturing PMI rose more than expected, with the Manufacturing PMI rising to a level not seen since April 2012. According to the NBS, China’s Mfg PMI rose from 51.6 to 51.8 in March, the highest in almost five years, and above the 51.7 consensus estimate, while the non-manufacturing PMI also jumped, rising from 54.2 to 55.1, the highest in two years.

    The National Bureau of Statistics reported that New Orders rose from 53.0 to 53.3 while new export orders rose to 51, the highest since early 2012. Broken by firm size, the state-measured PMI showed largest enterprises were the strongest at 53.3, followed by medium-sized companies, while small firms remained in contraction at 48.6. Perhaps the most notable internal metric was the employment index, which hit the 50 level for the first time since May 2012, marking the first time the manufacturing sector has not lost jobs in nearly 5 years.

    As the chart below shows, the catalyst for the move higher has been the recent surge in producer prices, which have soared as much as 7% Y/Y on the back of soaring commodity prices; both have since peaked and it is expected that in the coming months, China’s inflationary pressures will subside especially given the recent efforst by Beijing to reign in out of control credit, especially shadow, issuance.

    A subindex for construction activity rose in March for the first time since the start of the year, hitting 60.5. As a reminder, and as Deutsche Bank explained two weeks ago, the only thing that matters for both China, and the rest of the world, is making sure China’s housing bubble, as explained in “Why The Fate Of The World Economy Is In The Hands Of China’s Housing Bubble,” does not burst.

    “The first quarter is off to a good start,” said Wang Qiufeng, an analyst at China Chengxin International Credit Rating in Beijing, quoted by Bloomberg. “The upbeat momentum may last through the first half of this year, as the government is pushing investment.”

    “The fact that the real strength is with the non-manufacturing PMI suggests that there’s fundamentally a good story going on here,” said James Laurenceson, deputy director of the Australia-China Relations Institute at the University of Technology in Sydney. “Manufacturing is where you’d expect to see the effects of stimulus showing up.”

    So is China worried by the potential inflationary signals carried by today’s PMI prints? Oh yes, which is why the PBOC did not conduct a reverse repo liquidity injection for the sixth consecutive day, saying in a statement that the liquidity level if “relatively high” despite traditional month-end liquidity demands; as a result in the past 6 days, the PBOC has now drained some 320 billion yuan from the banking system.

    In recent days this has led to a sharp move higher in various repo tenors, most notably the benchmark 7-Day repo, which on Thursday fell w bps to 2.81%, but has jumped sharply in the past week as interbank funding problems have emerged, leading to the biggest drop in months in the Shanghai composite index overnight. Keep an eye on the the repo market in Friday’s session for any acute liquidity shortages, especially since China’s onshore market is closed on Monday and Tuesday.

  • How To Protect Your Online Privacy Now That Congress Sold You Out

    Authored by Eric Limer via Popular Mechanics

    All your private online data—the websites you visit, the content of your chats and emails, your health info, and your location—just became suddenly less secure. Not because of hackers, but because Congress just blocked crucial privacy regulations. This will allow your internet service provider to collect all your data and sell that info to the highest bidder without asking you first. Welcome to a brave new world.

    A pair of resolutions, which passed through the Senate and House with exclusively Republican votes, roll back rules proposed by the Democratic leadership of the Federal Communications Commission during the Obama administration which, though passed in October, had not yet gone into effect.

    The rules—which will be completely dead following the expected signature of President Trump—would have required ISPs to get explicit opt-in approval from customers before selling the following “sensitive data”:

    Passwords

     

    This doesn’t just mean that sharing that information without your explicit permission will be fine and dandy. Since the rules were rolled back through the Congressional Review Act, the FCC is also barred from creating any “substantially similar” rules down the line.

    In theory, the information collected will be stored under some sort of ID separate from your actual name. But that’s a cold comfort considering the level of detail in this sort of information would make your identity a dead giveaway, and ISPs can hardly be trusted to keep your identifying information suitably safe from prying eyes. After all, they’ll be building dossiers any hacker would love to steal.

    What to do? There are a few things you can do to try and keep your data safe, and while they aren’t necessarily easy or free, they’re worth it if you value your privacy.

    Opt out with your ISP

    Your ISP may not need your permission to sell your data, but you can still go to them and tell them not to do it. The catch, of course, is this requires you to be proactive, and there’s no real guarantee that this will protect you completely. Still, do it. Get on the phone or visit the website of your ISP and opt out of every ad-related thing—and into every privacy-related thing—you can find. The process can be a little arduous—often requiring the use of your ISP-given email address that you probably never use—and it may not take effect immediately either. All the better reason to do it now.

    Time Warner/Spectrum customers can find their privacy dashboard here. Comcast customers can opt out of some targeted programs using these instructions. Verizon customers can find opt out options here. Remember, your phone company is technically an ISP too, so look up your options on that front as well.

    Opting out is an important first step, but it is not enough to actually preserve your privacy. Your ISP is not necessarily giving you the opportunity to opt out of all its ad-targeting programs. As the policy counsel at the Open Technology Institute, Eric Null, told Gizmodo, it is “highly unlikely” the new FCC will go after ISPs that aren’t offering robust opportunities to opt-out.

    Some smaller ISPs, which survive on small and satisfied customer bases as opposed to a large and captive audience, are more incentivized to protect your privacy with gusto. In fact, a whole host of small ISPs wrote a letter to Congress opposing this move. If you’re lucky enough to have the option of switching to one, now might be a good time.

    Keep your data out of your ISP’s hands in the first place

    Your ISP is uniquely suited to snoop on your information. Anything you put online has to pass through its hands. Email you send through Gmail, chats through Facebook Messenger—they all travel through your ISP before they reach the service that actually sends them on. But while it is impossible to cut your ISP out of this exchange entirely, you can hide the data as you are sending it.

    Apps with end-to-end encryption can encrypt your private information on the phone or computer you’re using, ensuring that it is coded and protected through the entire delivery process. So while your ISP can see the data go by, they can’t make sense of it.

    Secure chat apps like Signal will be crucial to keep your chats private not only from the government and hackers, but from your ISP. Just make sure these services have security measures that are open-source and trusted by experts who can help keep them honest. You can also encrypt data manually, using a standard like PGP, before you send it off into the web, but it can be an arduous process, because you have to ensure that the recipient has the means to decode that info and read it.

    The most seamless solution is to pay for a Virtual Private Network—a VPN—which allows you to encrypt all the data that passes through your ISP. This means that while your ISP is still doing the work of hauling your data around, it can’t understand any of it. The downside to this is that VPNs (at least any VPNs you can trust) are not free. Most good ones will require a yearly subscription. Furthermore, you aren’t hiding your personal data from everyone, you are just entrusting it to the VPN instead of your ISP, so do your research and choose a VPN you trust not to sell you out. Fortunately, since VPNs exist exclusively to keep your data private, they are pretty incentivized to keep you happy.

    The only one you can really trust to protect you is you.

    The short and uncomfortable truth is this: Until more robust privacy protections are put in place, the burden of protecting your online data falls on you. Keep it in mind, do your research, and remember that your monopolized ISP has every reason in the world to sell you out and wring your data for every dime that it is worth. The only one you can really trust to protect you is you.

  • Starbucks Will Never Learn: New Program Encourages "Bipartisan Coffee Drinking"

    Seemingly no amount of brand destruction will ever be sufficient to convince Starbucks CEO Howard Schultz that while most adult-aged Americans seem to like his company’s coffee, roughly 50% of them couldn’t give a flying flip about his leftist political opinions that he’s constantly try to shove down their throats along with their morning java.

    The latest gimmick comes via a partnership with Boston-based startup “Hi From the Other Side” and offers free coffee to people with opposing political opinions who agree to meet up at Starbucks to “engage in a civil conversation” about their political differences.  Per The Hill:

    Participants who sign up (there’s currently a waitlist) for the app through Facebook are paired up with another local from the opposing political party.

     

    The app brings together “nice people across the political divide to talk like neighbors. Not to convince, but to understand,” the Hi From the Other Side website states. The company says it’s “hopeful there are people who really want to engage in a civil conversation.”

     

    As part of a recently launched, limited promotion, the startup says those who sign up and are matched will receive a Starbucks e-gift card.
    “This means you’ll have to show up and work together to unlock the gift card!” according to its site.

    And here’s “Hi From the Other Side’s” take on the program:

    “Hi From The Other Side has a way for you to make a connection over a great cup of coffee at Starbucks. If you are one of the first to be matched during this limited offer, you will receive a Starbucks e-gift card to redeem together at a nearby store. This means you’ll have to show up and work together to unlock the gift card!”

    SBUX

     

    Of course, all of this comes just a few weeks after Schultz’s public announcement to hire 10,000 refugees, a clear shot at the Trump administration’s immigration policies, seemingly backfired with his “brand perception” taking a sudden and massive hit (we wrote about it here: “Starbucks’ ‘Brand Perception’ Takes A Massive Hit After Announcing Plans To Hire 10,000 Refugees“).

    Credit Suisse’s Restaurant team, led by Jason West, also took note of the constant damaging political campaigns and warned that Schultz’s refugee stunt could cause the company to miss upcoming same-store-sales estimates.

    We have analyzed online “net sentiment” data (positive vs. negative online mentions) provided by NetBase to gauge changes in Starbucks’ brand perception. This follows recent media reports that SBUX’s decision to hire 10,000 refugees over the next five years could have upset some customers, perhaps negatively impacting sales trends. Our work shows a sudden drop in brand sentiment following announcement of the refugee hiring initiative on Jan. 29th, to flattish from a run-rate of ~+80 (on an index of -100 to +100). Net sentiment has since recovered, but has seen significant volatility in recent weeks. While this is only one data point, the analysis leaves us incrementally cautious on SBUX’s ability to meet consensus US SSS forecasts, which call for SSS to accelerate from +3% in F1Q17 (Dec. qtr.) to ~+3.5% in F2Q and ~+5.5% in 2H17.

     

    Potential impact to F2Q SSS: NetBase data show that net sentiment remained depressed for 10 days in late Jan. and early Feb. and was particularly volatile through the remainder of Feb. We see potential for a scenario in which US SSS slowed for a few weeks following news of the refugee hiring initiative, negatively impacting full-quarter SSS by ~70-80bps under a reasonable bear case. This assumes that (1) SSS during the initial 10-day stretch were ~flat, (2) SSS averaged +2% during the remaining 3 weeks of Feb. (when net sentiment saw particularly high volatility) and (3) SSS during the rest of the qtr (Jan. and Mar.) average +3.5% (in line with consensus forecasts for F2Q), putting F2Q US SSS at ~+2.8%. We caveat that we found little to no correlation over longer time periods between the net sentiment data and US SSS. However, in our past work on Chipotle (CMG: Neutral), we found that large and sudden spikes in net sentiment coincided with similar shifts in SSS trends.

    CS

     

    For those who missed it, here are some excerpts from the politically charged message drafted by Schultz to his employees with “deep concern and a heavy heart”:

    I write to you today with deep concern, a heavy heart and a resolute promise. Let me begin with the news that is immediately in front of us: we have all been witness to the confusion, surprise and opposition to the Executive Order that President Trump issued on Friday, effectively banning people from several predominantly Muslim countries from entering the United States, including refugees fleeing wars. I can assure you that our Partner Resources team has been in direct contact with the partners who are impacted by this immigration ban, and we are doing everything possible to support and help them to navigate through this confusing period.

     

    Hiring Refugees: We have a long history of hiring young people looking for opportunities and a pathway to a new life around the world. This is why we are doubling down on this commitment by working with our equity market employees as well as joint venture and licensed market partners in a concerted effort to welcome and seek opportunities for those fleeing war, violence, persecution and discrimination.  There are more than 65 million citizens of the world recognized as refugees by the United Nations, and we are developing plans to hire 10,000 of them over five years in the 75 countries around the world where Starbucks does business.

     

    Building Bridges, Not Walls, With Mexico: We have been open for business in Mexico since 2002, and have since opened almost 600 stores in 60 cities across the country, which together employ over 7,000 Mexican partners who proudly wear the green apron. Coffee is what unites our common heritage, and as I told Alberto Torrado, the leader of our partnership with Alsea in Mexico, we stand ready to help and support our Mexican customers, partners and their families as they navigate what impact proposed trade sanctions, immigration restrictions and taxes might have on their business and their trust of Americans.

    Apparently nothing will ever convince some of America’s leftist billionaires that, no matter how rich they become, they will never be able to force their political opinions on Americans who see through their propaganda…just ask all the rich people that just lost a fortune trying to elect Hillary.

  • "He Certainly Has A Story To Tell" – Statement From Mike Flynn's Lawyer

    Hot on the heels of the WSJ report that Trump’s former National Security Advisor, Mike Flynn, has offered to testify in exchange for immunity from prosecution, Flynn’s lawyer, Robert Kelner of the law firm Covington, issued the following statement, in which judging by Kelner’s language, Flynn’s offer is not so much to “turn” on Trump, as to set the record straight, while putting an end to the ongoing “media witch hunt”, to wit:

    the media are awash with unfounded allegations, outrageous claims of treason, and vicious innuendo directed against him. He is now the target of unsubstantiated public demands by Members of Congress and other political critics that he be criminally investigated. No reasonable person, who has the benefit of advice from counsel, would submit to questioning in such a highly politicized, witch hunt environment without assurances against unfair prosecution.

    It is also notable that Flynn’s lawyer does not explicitly mention a request for immunity as the WSJ reported, instead it merely requests an environment which assures against “unfair prosecution.”

    The full statement by Robert Kelner is below

    Counsel to Lt. General Mike Flynn (Retired)

     

    General Flynn certainly has a story to tell, and he very much wants to tell it, should the circumstances permit.

     

    Out of respect for the Committees, we will not comment right now on the details of discussions between counsel for General Flynn and the House and Senate Intelligence Committees, other than to confirm that those discussions have taken place. But it is important to acknowledge the circumstances in which those discussions are occurring.

     

    General Flynn is a highly decorated 33-year veteran of the U.S. Army. He devoted most of his life to serving his country, spending many years away from his family fighting this nation’s battles around the world. He was awarded four Bronze Stars for actions in Iraq, Afghanistan and elsewhere in the war on terror. He received the Legion of Merit twice, and the Defense Superior Service Medal four times. He is a recipient of the Defense Department’s Distinguished Service Award and the Intelligence Community Gold Seal Medallion for Distinguished Service, as well as numerous other decorations.

     

    Notwithstanding his life of national service, the media are awash with unfounded allegations, outrageous claims of treason, and vicious innuendo directed against him. He is now the target of unsubstantiated public demands by Members of Congress and other political critics that he be criminally investigated. No reasonable person, who has the benefit of advice from counsel, would submit to questioning in such a highly politicized, witch hunt environment without assurances against unfair prosecution.

    h/t @ChuckRossDC

  • Is War Between U.S. And China Brewing In The South China Sea?

    Authored by James Holbrooks via TheAntiMedia.org,

    Adding fuel to an already highly combustible situation in Southeast Asia, Reuters reported Tuesday that China has “largely completed major construction of military infrastructure on artificial islands it has built in the South China Sea,” and that the Asian superpower “can now deploy combat planes and other military hardware there at any time.”

    Citing satellite imagery analyzed by the Asian Maritime Transparency Initiative, part of Washington, D.C.’s Center for Strategic and International Studies, the news agency writes that “work on Fiery Cross, Subi and Mischief Reefs in the Spratly Islands included naval, air, radar and defensive facilities.”

    Sticking to the mainstream narrative that China is an aggressor in claiming sovereign rights to the majority of the South China Sea, Pentagon spokesman Commander Gary Ross says the new images confirm what the U.S. military already knows.

    “China’s continued construction in the South China Sea is part of a growing body of evidence that they continue to take unilateral actions which are increasing tensions in the region and are counterproductive to the peaceful resolution of disputes,” he told Reuters.

    China, as it has repeatedly, downplayed this notion and stuck to the position that it’s simply erecting defensive infrastructure within its own borders, as would any nation.

    “As for China deploying or not deploying necessary territorial defensive facilities on its own territory, this is a matter that is within the scope of Chinese sovereignty,” Foreign Ministry spokeswoman Hua Chunying said at a press briefing Tuesday.

    Despite comments such as these — and the very real fact that China hasn’t actually invaded anyone — the corporate media jumped on the news of the new images.

    Forbes, for instance, ran a piece that essentially listed all the reasons why China is a really bad actor in the region, and CNN talked to analysts who explained how the military buildup on the artificial islands will be gradual as China continues to exert its authoritarian influence over neighboring countries.

    That’s the narrative. Believe as you will.

    But the reality of the situation in the South China Sea – all geopolitical analysis aside – is that there’s about to be a hell of a lot of military hardware in those waters.

    As Anti-Media has been reporting, U.S. forces are already in the region, taking part in joint drills with ally South Korea that will last until the end of April. Then, at the beginning of May, Japan — another U.S. ally — will sail its navy’s most powerful warship through the South China Sea on a three-month tour.

    That means that just as the joint drills with South Korea end — which, incidentally, units from Delta Force, the Navy SEALS and Army Rangers are taking part in — Japan will shove off a warship aimed at waters claimed by China.

    If that timing seems a little curious, also consider that the U.S. just deployed its Terminal High Altitude Area Defense (THAAD) missile system in South Korea, which both China and Russia cared none too much for.

    With China showing no signs of backing away from its stance in the South China Sea — both ideologically and physically —  and with the corporate media willing and eager to push the “evil China” narrative that the U.S. military appears hell-bent on capitalizing on, it appears the long-dreaded collision course with China may, indeed, be not far off on the horizon.

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Mar 30

Today’s News 30th March 2017

  • Despite Record Highs, Brexit Still A Losing Bet For Dollar Investors

    One day after UK PM Theresa May officially unleashed the Article 50 letter proclaiming the beginning of the end of Britain within the EU, the UK stock market had rallied over 16% since the vote that elites said would bring armageddon. However, remove the support of a collapsed currency and things look very different for a US dollar investor.

    The UK’s FTSE 100 – whose megacap members get the majority of their revenue from outside the UK – looks very different when adjusted for the depreciation of the pound.

    In fact, for a dollar investor, they remain underwater since the Brexit vote, having never seen a ‘return to even’ since, thanks to the near 19% collapse in cable…

     

    Even as dollar investors in Japan, Germany, and the US seem to have done uniformly well…

  • Iran's President Rouhani Visited Russia: Another Step To A Multipolar World

    Authored by Peter Korzun via The Strategic Culture Foundation,

    The significance of Iranian President Hassan Rouhani’s visit to Russia on March 27-28 goes far beyond the bilateral relationship. Iran is one of the main actors in Syria and Iraq. It has an importance place in the geopolitical plans of US President Donald Trump. Its relationship with Russia is an important factor of international politics. The future of the entire Middle East depends to a great extent on what Russia and Iran do and how effectively they coordinate their activities.

    Less than two months are left till the presidential election in Iran. The presidential race formally starts on April 17 and Rouhani has a good chance to win. True, the country’s foreign policy at the strategic level is defined by Iran's Supreme Leader, Ayatollah Ali Khamenei, but the executive branch of the government led by president implements it. The spiritual leader does not pay visits to other countries but Russian President Vladimir Putin met him in Tehran last year – the second time in the recent 17 years.

    This was Rouhani's first official visit to Russia and the first time he and Putin met within a bilateral framework. The trip took place against the background of growing partnership as both countries have become leading forces of the Astana process that made Iran, Russia and Turkey guarantors of the Syrian cease-fire.

    True, the cooperation in Syria is of utmost importance but there is each and every reason to believe that Russia and Iran will have to join together in an attempt to settle the conflict in Afghanistan. As a regional superpower, Iran will gain much by coordinating activities with Russia in that country after the US withdrawal that seems to be inevitable. Such cooperation would become a game-changing factor with far-reaching consequences for the region from the Mediterranean to Pakistan.

    The emerging triangle, including Russia, Iran and Turkey, becomes an alliance, could reshape the region. A ceasefire in Syria reached as a result of the Astana process led by the «big three» would reduce the clout of the US, the UK and France. Actually, their influence has already been diminished. The neighboring states will see that progress can be achieved without the «traditional players» representing the West.

    Russia is the country that can debunk the myth that the Middle East is threatened by a «Shia threat» emanating from Tehran. It can use its close and friendly relations with leading Sunni states – Egypt, Jordan, the UAE and, perhaps, Saudi Arabia – to play the stabilizing role of mediator between the Shia and Sunni camps. Russia has a unique position to act as an intermediary between Iran and Israel – something nobody else can do.

    It’ll take years to heal the wounds and mitigate the contradictions between Shia and Sunni Muslims in Lebanon, Syria and Iraq. Today, the West does not enjoy the clout it once had there. The borders drawn by Western countries caused many conflicts; direct military interventions made them lose trust and support. Under the circumstances, Russia is not exactly an outside actor. Moscow needs peace and stability in the region. This goal can be achieved in tandem with Turkey and Iran. Iraq and Syria can join the trio after they overcome the devastating results of wars. It makes the cooperation with Tehran an issue of paramount importance for Russia.

    The bilateral relationship is going to be strengthened by large-scale economic projects.

    Despite the importance of foreign policy issues, the talks mainly focused on prospects for deepening trade, economic and investment cooperation, including under large joint projects in energy and transport infrastructure. More than ten major trade and economic agreements were signed during the visit. Russia has already pumped about one billion euros into Iran' railway network, with serious financial injections into bilateral projects yet to be implemented.

    Exports to Iran stand at only around 1 percent of Russian foreign trade, but a trade surplus and the existence of a large market for Russian manufactured goods make Iran an important partner. The bilateral trade grew by 60 percent from $1.2 billion in 2015 to almost $2 billion in 2016.

    The resumption of weapons deliveries and participation in infrastructure projects financed by Russian loans have led to the doubling of exports of non-energy products from Russia to Iran. The first batch of S-300 air defense systems was delivered in April 2016.

    Russia has agreed to provide Iran with a loan of $2.2 billion for infrastructure projects involving Russian companies. It is planned to build a power plant and enhance generation at another in Iran in a contract worth several billion dollars. Under an agreement signed between the two sides, the Russians will improve efficiency at the Ramin power plant in Khuzestan province to 50-55% from 36% now. Another Russian company will build a 1,400-megawatt power plant in the Iranian city of Bandar Abbas in Hormuzgan province. Russian truck manufacturer Kamaz plans to export 300 trucks in 2017, GAZ signed a memorandum with the Iranian authorities for the supply of 900 buses.

    Russia’s role in reaching the Iran nuclear deal, the cooperation in Syria and the allegiance to the policy of rapprochement declared by President Putin provide ample evidence of Moscow’s desire to boost the bilateral ties.

    A momentous event to take place this year will provide an impetus to the development of Russia-Iran relations. Tehran is expected to become a full-fledged member of the Shanghai Cooperation Organization (SCO) this June. Iran also has expressed interest in signing a trade agreement with the Eurasian Union.

    Russia and Iran are united by common goals and interests. The development of relations between the two great powers is a significant contribution into creating alternative poles of power to change the world for the better.

  • If Evelyn Farkas Resigned in 2015, How Did She Have Access to Trump-Russian Intelligence?

    This was making waves yesterday, after Evelyn Farkas admitted on The Morning Joe show that she told Mika that she strongly advised people ‘on the hill’ and in intelligence to tuck away intelligence regarding Russo-Trump ties for the sake of preservation, in an effort to protect it from the onerous bureaucracy she obviously finds to be deplorable.

     

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    “Get as much intelligence as you can before President Obama leaves the administration,” said Farkas in an interview yesterday on MSNBC.

    She was afraid the Trump people would gain access to their intelligence and whisk it away — because they’re all Russian spies, obviously.

    Aside from what appears to be a brazen confirmation of spying on the Trump team, the bigger red flag here is Dr. Farkas wasn’t employed by the Obama administration at the time the Russian allegations arose.

    According to Pentagon records, Dr. Farkas resigned in September of 2015.

    So how did this non-resident fellow at the Atlantic Council, member of the Council on Foreign Relations, and former deputy assistant secretary of defense for Russia, Ukraine and Eurasia, gain knowledge of intelligence regarding members of Trump’s team and their relations with Russia, when she was the senior foreign policy advisor for Presidential candidate Hillary Clinton?

    Farkas was the prime driver behind the anti-Russia phobia inside the Pentagon during the Obama years — shilling hard for the Ukraine — requesting that the President send them anti-tank missiles — which, essentially, would mean outright war with Russia.

    Back to the interview with Mika Brzezinski. Dr. Farkas said ‘we’ had good intel on Russia. Who does she refer to when she says ‘we?’

    Professional Deep Stater, Dr. Evelyn Farkas, Globalist Shill

    Here’s Mark Levin’s take on this scandal.

    Perhaps someone inside the Obama government was leaking to the Hillary campaign?

    I think we all know what the answer to what that question is, regardless of how uncomfortable a thought it may be.

    Content originally generated at iBankCoin.com

  • Obamacare 'Explosion' Could Come On May 22nd, Here's Why

    After a stunning healthcare defeat last week, delivered at the hands of his own party no less, Trump took to twitter to predict the imminent ‘explosion’ of Obamacare.

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    As it turns out, that ‘explosion’ could come faster than anyone really expects as legislators and health insurers have to make several critical decisions about the 2018 plan year over the next 2 months which could seal Obamacare’s fate.

    As the Atlanta Journal Constitution points out today, the Trump administration has until May 22nd to decide whether they will continue to pursue the Obama administration’s appeal to provide subsidies to insurers who participate in the federal exchanges. 

    Of course, any decision to remove those subsidies would likely result in yet another massive round of premium hikes and further withdrawals from the already crippled exchanges where an astounding number of counties across the country have already been cut to just 1 health insurance provider.  And, as we’ve pointed out before, higher rates = lower participation = deterioration of risk pool = higher rates….and the cycle just repeats until it eventually collapses.

    As background, in 2014, House Republicans sued the Obama administration over the constitutionality of the cost-sharing reduction payments (a.k.a. “taxpayer funded healthcare subsidies”), which had not been appropriated by Congress.  Republicans won the initial lawsuit but the Obama administration subsequently appealed and now Trump’s administration can decide whether to pursue the appeal or not.

    One key to insurers selling plans in the marketplace are reimbursements they receive called cost-sharing reductions. These aren’t the same as the tax credits that people receive to help pay their premiums; it is financial assistance to help low-income people pay their out-of-pocket costs, such as deductibles. The Congressional Budget Office projected those payments would add up to $7 billion this year and $10 billion in 2018.

     

    But for insurers, there’s a question over how long that money will be delivered, due to an ongoing political and legal dispute about whether the cost-sharing money should be distributed at all.

     

    In 2014, House Republicans sued the Obama administration over the constitutionality of the cost-sharing reduction payments, which had not been appropriated by Congress. The lawmakers won the lawsuit, and the Obama administration appealed it. Late last year, with a new administration on the other end of the suit, the House sought to pause the proceedings — with a deadline for a status update in late May.

     

    The Trump administration and House lawmakers have to report to the judge this spring. If the Trump administration drops the appeal, it would mean the subsidies would stop being paid — a huge blow to the marketplaces and millions of people. If lawmakers wanted the payments to continue, they would have to find a way to fund them. One opportunity for that is coming up fast, the continuing resolution that must be passed by April 28. If the Trump administration continues the lawsuit, it will be in the odd position of fighting its own party.

    The CBO estimates the payments would total roughly $10 billion in 2018.

    As we’ve noted before, several large insurers, including UnitedHealth Group and Aetna, have already made the decision to exit Obamacare due to financial losses.  Now, Molina Healthcare is also pondering whether it would be able to continue to participate in the absence of federal subsidies.

    Big insurers like UnitedHealth Group and Aetna have mostly left the individual market over the years, citing financial reasons. Several counties across the country only have one insurer offering ObamaCare plans.

     

    Now Molina Healthcare is signaling it may downsize its presence in the market, or pull out altogether, if Congress or the administration doesn’t act to stabilize it. Molina has 1 million exchange enrollees in nine states this year.

     

    “We need some clarity on what’s going to happen with cost-sharing reductions and understand how they’re going to apply the mandate,” said Molina CEO Dr. Mario Molina.

     

    Asked if Molina would leave ObamaCare if the payments are stopped, the CEO said: “It would certainly play into our decision. We’ll look at this on a market-by-market basis. We could leave some. We could leave all.”

     

    Mario Molina, chief executive of Molina Healthcare, predicted that if the cost-sharing reductions are not funded, it could result in premium increases on the order of 10 to 12 percent.

    While all this uncertainty swirls, health insurers must decide — soon — whether to make rate filings to sell insurance in 2018. The deadline varies by state, but for those that have marketplaces run by the federal government, it is June 21. Filing doesn’t mean that insurers will participate; they’ll have months more to negotiate and could still drop out. But it’s the first step toward offering plans in 2018 and should provide a signal about what the marketplaces are likely to look like.

    Meanwhile, it seems pretty likely that Obamacare couldn’t survive another collapse in coverage like we saw in 2017 (charts per the New York Times):

    2016 healthcare insurance carriers by county:

    Obamacare 2016

     

    2017 healthcare insurance carriers by county:

    Obamacare 2017

     

    The first step is admitting you have a problem.

  • Death At Your Door: Knock-And-Talk Police Tactics Rip A Hole In The Constitution

    Authored by John Whitehead via The Rutherford Institute,

    “It’s 4 in the morning, there’s headlights that are shining into your house; there’s a number of different officers that are now on the premises; they’re wearing tactical gear; they have weapons; and they approach your front door. Do you think that the ordinary citizen in that situation feels that they have an obligation to comply?”— Michigan Supreme Court Justice Richard Bernstein

    It’s 1:30 a.m., a time when most people are asleep.

    Your neighborhood is in darkness, except for a few street lamps. Someone—he doesn’t identify himself and the voice isn’t familiar—is pounding on your front door, demanding that you open up. Your heart begins racing. Your stomach is tied in knots. The adrenaline is pumping through you. You fear that it’s an intruder or worse. You not only fear for your life, but the lives of your loved ones.

    The aggressive pounding continues, becoming more jarring with every passing second. Desperate to protect yourself and your loved ones from whatever threat awaits on the other side of that door, you scramble to lay hold of something—anything—that you might use in self-defense. It might be a flashlight, a baseball bat, or that licensed and registered gun you thought you’d never need. You brace for the confrontation, a shaky grip on your weapon, and approach the door cautiously. The pounding continues.

    You open the door to find a shadowy figure aiming a gun in your direction. Immediately, you back up and retreat further into your apartment. At the same time, the intruder opens fire, sending a hail of bullets in your direction. Three of the bullets make contact. You die without ever raising your weapon or firing your gun in self-defense. In your final moments, you get a good look at your assailant: it’s the police.

    This is what passes for “knock-and-talk” policing in the American police state.

    “Knock-and-shoot” policing might be more accurate, however.

    Whatever you call it, this aggressive, excessive police tactic has become a thinly veiled, warrantless exercise by which citizens are coerced and intimidated into “talking” with heavily armed police who “knock” on their doors in the middle of the night.

    Poor Andrew Scott didn’t even get a chance to say no to such a heavy-handed request before he was gunned down by police.

    It was late on a Saturday night—so late that it was technically Sunday morning—and 26-year-old Scott was at home with his girlfriend playing video games when police, in pursuit of a speeding motorcyclist, arrived at Scott’s apartment complex, because a motorcycle had been spotted at the complex and police believed it might belong to their suspect.

    At 1:30 a.m., four sheriff’s deputies began knocking on doors close to where a motorcycle was parked. The deputies started their knock-and-talk with Apartment 114 because there was a light on inside. The occupants of the apartment were Andrew Scott and Amy Young, who were playing video games.

    First, the police assumed tactical positions surrounding the door to Apartment 114, guns drawn and ready to shoot.

    Then, without announcing that he was a police officer, deputy Richard Sylvester banged loudly and repeatedly on the door of Apartment 114. The racket caused a neighbor to open his door. When questioned by a deputy, the neighbor explained that the motorcycle’s owner did not live in Apartment 114.

    This information was not relayed to the police officer stationed at the door.

    Understandably alarmed by the aggressive pounding on his door at such a late hour, Andrew Scott retrieved his handgun before opening the door. Upon opening the door, Scott saw a shadowy figure holding a gun outside his door.

    Still police failed to identify themselves.

    Unnerved by the sight of the gunman, Scott retreated into his apartment only to have Sylvester immediately open fire. Sylvester fired six shots, three of which hit and killed Scott, who had no connection to the motorcycle or any illegal activity.

    So who was at fault here?

    Was it Andrew Scott, who was prepared to defend himself and his girlfriend against a possible late-night intruder?

    Was it the police officers who banged on the wrong door in the middle of the night, failed to identify themselves, and then—without asking any questions or attempting to de-escalate the situation—shot and killed an innocent man?

    Was it the courts, which not only ruled that the police had qualified immunity against being sued for Scott’s murder but also concluded that Andrew Scott provoked the confrontation by retrieving a lawfully-owned handgun before opening the door?

    Or was it the whole crooked system that’s to blame? I’m referring to the courts that continue to march in lockstep with the police state, the police unions that continue to strong-arm politicians into letting the police agencies literally get away with murder, the legislators who care more about getting re-elected than about protecting the rights of the citizenry, the police who are being trained to view their fellow citizens as enemy combatants on a battlefield, and the citizenry who fail to be alarmed and outraged every time the police state shoots another hole in the Constitution.

    What happened to Andrew Scott was not an isolated incident.

    As Supreme Court nominee Neil Gorsuch recognized in a dissent in U.S. v. Carloss: “The ‘knock and talk’ has won a prominent place in today’s legal lexicon… published cases approving knock and talks have grown legion.”

    In fact, the Michigan Supreme Court is currently reviewing a case in which seven armed police officers, dressed in tactical gear and with their police lights on, carried out a knock-and-talk search on four of their former colleagues’ homes early in the morning, while their families (including children) were asleep. The police insist that there’s nothing coercive about such a scenario.

    Whether police are knocking on your door at 2 am or 2:30 pm, as long as you’re being “asked” to talk to a police officer who is armed to the teeth and inclined to kill at the least provocation, you don’t really have much room to resist, not if you value your life.

    Mind you, these knock-and-talk searches are little more than police fishing expeditions carried out without a warrant.

    The goal is intimidation and coercion.

    Unfortunately, with police departments increasingly shifting towards pre-crime policing and relying on dubious threat assessments, behavioral sensing warnings, flagged “words,” and “suspicious” activity reports aimed at snaring potential enemies of the state, we’re going to see more of these warrantless knock-and-talk police tactics by which police attempt to circumvent the Fourth Amendment’s warrant requirement and prohibition on unreasonable searches and seizures.

    We’ve already seen a dramatic rise in the number of home invasions by battle-ready SWAT teams and police who have been transformed into extensions of the military. Indeed, with every passing week, we hear more and more horror stories in which homeowners are injured or killed simply because they mistook a SWAT team raid by police for a home invasion by criminals.

    Never mind that the unsuspecting homeowner, woken from sleep by the sounds of a violent entry, has no way of distinguishing between a home invasion by a criminal as opposed to a government agent.

    Too often, the destruction of life and property wrought by the police is no less horrifying than that carried out by criminal invaders.

    These incidents underscore a dangerous mindset in which civilians (often unarmed and defenseless) not only have less rights than militarized police, but also one in which the safety of civilians is treated as a lower priority than the safety of their police counterparts (who are armed to the hilt with an array of lethal and nonlethal weapons).

    In fact, the privacy of civilians is negligible in the face of the government’s various missions, and the homes of civilians are no longer the refuge from government intrusion that they once were.

    It wasn’t always this way, however.

    There was a time in America when a person’s home was a sanctuary where he and his family could be safe and secure from the threat of invasion by government agents, who were held at bay by the dictates of the Fourth Amendment, which protects American citizens from unreasonable searches and seizures.

    The Fourth Amendment, in turn, was added to the U.S. Constitution by colonists still smarting from the abuses they had been forced to endure while under British rule, among these home invasions by the military under the guise of writs of assistance. These writs were nothing less than open-ended royal documents which British soldiers used as a justification for barging into the homes of colonists and rifling through their belongings.

    James Otis, a renowned colonial attorney, “condemned writs of assistance because they were perpetual, universal (addressed to every officer and subject in the realm), and allowed anyone to conduct a search in violation of the essential principle of English liberty that a peaceable man’s house is his castle.” As Otis noted:

    Now, one of the most essential branches of English liberty is the freedom of one’s house. A man’s house is his castle; and whilst he is quiet, he is as well guarded as a prince in his castle. This writ, if it should be declared legal, would totally annihilate this privilege. Custom-house officers may enter our houses when they please; we are commanded to permit their entry. Their menial servants may enter, may break locks, bars, and everything in their way; and whether they break through malice or revenge, no man, no court can inquire. Bare suspicion without oath is sufficient.

    To our detriment, we have now come full circle, returning to a time before the American Revolution when government agents—with the blessing of the courts—could force their way into a citizen’s home, with seemingly little concern for lives lost and property damaged in the process.

    Actually, as I make clear in my book Battlefield America: The War on the American People, we may be worse off today than our colonial ancestors when one considers the extent to which courts have sanctioned the use of no-knock raids by police SWAT teams (occurring at a rate of 70,000 to 80,000 a year and growing); the arsenal of lethal weapons available to local police agencies; the ease with which courts now dispense search warrants based often on little more than a suspicion of wrongdoing; and the inability of police to distinguish between reasonable suspicion and the higher standard of probable cause, the latter of which is required by the Constitution before any government official can search an individual or his property.

    Winston Churchill once declared that “democracy means that if the doorbell rings in the early hours, it is likely to be the milkman.”

    Clearly, we don’t live in a democracy.

    No, in the American police state, when you find yourself woken in the early hours by someone pounding on your door, smashing through your door, terrorizing your family, killing your pets, and shooting you if you dare to resist in any way, you don’t need to worry that it might be burglars out to rob and kill you: it’s just the police.

  • GHoST IN THe SMeLL…
  • Can Trump Turn Back Time On Coal Mining Employment?

    President Trump signed an executive order on Tuesday, repealing many of the environmental regulations introduced by his predecessor Barack Obama and rescinding a moratorium on the leasing of federal land to coal mining companies. In “ending the war on coal”, Trump tries to make good on his campaign promise to bring thousands of unemployed coal miners back to work and secure U.S. energy independence.

    As Statista's Felix Richter notes, Trump, like many of his supporters, blames Obama’s environmental policies for the coal industry’s decline, which, as the chart below illustrates, started long before Obama took office in 2009. While it is true that coal consumption and mining employment did drop significantly during Obama’s presidency, experts keep pointing out that the decline was caused primarily by the rise of natural gas and only secondarily by environmental regulation.

    Infographic: Can Trump Turn Back Time on Coal Mining Employment? | Statista

    You will find more statistics at Statista

    In the late 2000s, a boom in natural gas production, driven by new hydraulic fracturing (fracking) technology, drove down prices for natural gas and the demand for electricity produced from coal subsequently plummeted. In 2000, coal accounted for more than 50 percent of U.S. electricity generation. By 2016, that percentage had dropped to around 30 percent with natural gas going the opposite direction. When natural gas surpassed coal for the first time in 2016, the EIA concluded that the rise of gas “was mainly a market-driven response to lower natural gas prices that have made natural gas generation more economically attractive”.

    Repealing environmental regulation will likely slow down the decline of the coal industry, but it is highly doubtful that it will reverse a trend that has been ongoing for decades. By easing fracking limitations, President Trump’s anti-regulation policy may even worsen the coal industry’s situation as laxer extraction rules could drive down the price of natural gas even further.

  • George W. Bush On Trump's Inauguration: "That Was Some Weird Shit"

    Perhaps just as memorable as the somewhat surreal Trump inauguration on Jan. 20, was the unforgettable crusade of George W. Bush to tame his poncho on that rainy Friday afternoon.

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    Whether flustered by the elements, or simply due to this residual antagonism for the president, after Trump’s short and dire speech, Bush departed the scene and never offered public comment on the ceremony. Until now.

    According to a new report by New York magazine, three people present at the event say they heard Bush’s assessment of the swearing in ceremony.

    “That was some weird shit.”

    Bush attended Trump’s inauguration, sitting near former President and First Lady Bill and Hillary Clinton as well as former President and first lady Barack and Michelle Obama. He has kept a low profile since.

  • Second Foundation: Empire Crumbling

    Authored by Jim Quinn via The Burning Platform blog,

    In Part One of this article I analyzed the similarities of Isaac Asimov’s Foundation Trilogy to Strauss & Howe’s Fourth Turning, trying to assess how Donald Trump’s ascension to power fits into the theories put forth by those authors. In Part Two of this article I compared and contrasted Donald Trump’s rise to power to the rise of The Mule in Asimov’s masterpiece. Unusually gifted individuals come along once in a lifetime to disrupt the plans of the existing social order. Despite the forlorn hope Donald Trump or some other savior can reverse our course, decades of missteps, dreadful decisions, ineffectual leadership, and unconcealed treachery have paved a path to destruction for the American Empire.

    American Empire Crumbling

    “Mr. Advocate, the rotten tree-trunk, until the very moment when the storm-blast breaks it in two, has all the appearance of might it ever had. The storm-blast whistles through the branches of the Empire even now. Listen with the ears of psychohistory, and you will hear the creaking.” – Isaac Asimov, Foundation

    http://static.safehaven.com/authors/burningplatform/33080_b.jpg

    “Now any dogma, based primarily on faith and emotionalism, is a dangerous weapon to use on others, since it is almost impossible to guarantee that the weapon will never be turned on the user.” – Isaac Asimov, Foundation

    The elitist ruling class gathers at Davos and their secretive Bilderberg meetings to plot the course of the world, divvying up the vast wealth plundered through their globalization schemes, and developing the newest propaganda narrative to keep the global masses confused, distracted, and powerless to fight back. Despite their wealth and power, an epic level of hubris is always their undoing.

    The normal people have begun to fight back but, like the rotten tree trunk Galactic Empire, the “mighty” American Empire, forged from the debris of two world wars, awaits the storm blast which will expose its true level of rot. The American Empire is crumbling under the weight of military overreach; the burden of unpayable debts; currency debasement; cultural decay; civic degeneration; diversity and deviancy trumping common culture and normality; pervasive corruption at every level of government; and the failure of shortsighted leaders to deal with the real problems.

    You can hear the creaking as the winds of this Fourth Turning winter howl through the branches of this dying empire. Trump may have forced the Deep State Second Foundation to reveal itself as they seek to destroy him, but the relentless decline of the American Empire continues unabated. Tinkering around the edges of a healthcare system designed to benefit mega-corporations and the Deep State will do nothing to reverse or even delay the decline.

    Slowing the growth of government when the national debt is already $20 trillion and headed to $30 trillion within the next decade won’t cure the rot in our tree trunk. Completely ignoring the $200 trillion of unfunded welfare state liabilities helps accelerate the inevitable collapse of this empire. Cutting taxes while expanding the war making machine known as the military industrial complex does nothing to reverse what is already in motion.

    In addition to the absolutely quantifiable reasons why the American Empire will collapse, there are demographic, cultural, and societal trends which will contribute dramatically to the fall. The rapidly aging populace, with 10,000 Americans per day turning 65 years old, is the driving force towards national bankruptcy, as this inexorable demographic tsunami sweeps over the fraying fabric of welfare state promises.

    The onslaught of illegal immigrants and purposeful execution of a plan by the effete liberal elite to weaken our common American culture through the insertion of Muslim refugees into our communities, is undermining the shared values which built the country. The immigrants who built this country assimilated, learned the language, worked hard, and adopted our common culture. The hordes invading America at this time hate our values and refuse to assimilate. This Soros funded effort to create diversity havoc throughout the world is part of the globalization one world order plan.

    As Europe disintegrates under the unrelenting wave of violent refugees creating upheaval, chaos, and spreading religious zealotry through viciousness, the next target is the mighty American Empire. Fighting in the streets between the normal law abiding Trump supporters and the Soros funded, draped in black, flag burning, social justice warrior criminals has begun. Widespread societal strife is just around the corner.

    When the next financial crisis, created by the Deep State to further their plans, destroys the remaining wealth of the barely surviving middle class, all hell will break loose in the streets. The 86% of the country occupied by red state, gun owning, Trump supporters will openly go to war against the condescending, left wing, violence provoking blue state liberals. Blood will be spilled in copious amounts. It always does during Fourth Turnings.

    Will Trump’s reign resemble the reign of The Mule? The Mule’s conquest was astonishingly fast. He defeated the Foundation and established the Union of Worlds after only five years. The unpredictability of his arrival and rare mental talents befuddled the Foundation. Then he inexplicably paused in his campaign of conquests. Instead he launched repeated expeditions in search of the Second Foundation. The mysterious Second Foundation inhibits The Mule from further conquest as he is consumed with finding their location and paralyzed with fear they can defeat his mentalic powers.

    The Second Foundation comes briefly out of hiding to face the threat of The Mule. It is revealed to be an assemblage of the most intelligent humans in the galaxy, descendants of Seldon’s psychohistorians. Using the force of its strongest minds, the Second Foundation ultimately wears down the Mule. They succeed in defeating the Mule, transforming him into a relatively harmless individual, lacking ambition, and no longer a threat to the Seldon Plan. His destructive posture is adjusted to a benign one. He returns to rule over his kingdom peacefully for the rest of his life, without any further thought of conquering the Second Foundation.

    Trump has had an astonishingly fast rise to power. He went from frivolous reality TV star to the most powerful leader on earth in the space of two years. With his clownish exploits and rhetoric, he rose to power through being underestimated every step of the way – infuriating his many enemies who miscalculated his level of political savvy and persuasion skills. Unless he is overthrown by the Deep State or killed, he will be able to put his imprint on the nation for at least four years and possibly eight.

    His first two months in power will likely reflect his entire presidency. The Washington establishment and sinister Deep State players will attempt to thwart Trump’s every move. They have already impeded his immigration controls and attempt to repeal and replace Obamacare, while using their illegal surveillance state techniques to undermine his administration.

    The Second Foundation, through unyielding pressure and generating fear of the unknown into the mind of The Mule, was able undermine his plans of conquest and turn him into a non-disruptive, toothless, nonthreatening, passive figurehead. As Trump’s best laid plans are obstructed, agenda foiled, and legislation hindered, will his enthusiasm for governance wane?

    The surveillance agencies who are supposed to act on his behalf are clearly trying to subvert his presidency. Leaks and fake news designed to sabotage the credibility of Trump and his administration will continue. Will the fear of retribution from mysterious surveillance state operatives convince Trump to fall into line and become a submissive lackey, no longer making waves for the Deep State?

    I have no illusions Trump is some sort of savior who will reverse decades of political corruption, currency debasement, financial market rigging, global military missteps, cultural decay, pervasive entitlement mindset, and out of control espionage operatives. At best, he will slow some aspects of the decline over a short time frame. More likely, he will provoke his enemies to such an extent the decline will be accelerated due to civil and/or global war breaking out. The oncoming financial collapse will further push the country toward the brink. It’s not a matter of if, but when. And the when is closer than most people imagine.

    The seeds of destruction for the American Empire were planted as Ben Franklin departed the Constitutional Convention two hundred and thirty years ago responding to a question from Mrs. Powell that they had given the people a republic, if they could keep it. The seeds were slow to take root, but the transition from republic to democracy insured long-term decline as the people voted for more benefits, paid for by their fellow citizens and financed by debt.

    With the secretive creation of the privately owned Federal Reserve in 1913, the debasement of our currency was begun. The true birth of the American Empire occurred with surrender of Germany & Japan at the conclusion of World War II. As the only major power not in physical and economic shambles, America dominated the world until its hubris kicked in during the late 1960s with the birth of the welfare/warfare state financed by debt. Closure of the gold window in 1971 sealed our fate.

    We’ve crossed our Rubicon with the preservation and expansion of empire bankrupting the nation. We just refuse to admit it. It’s already a done deal. Default is baked in the cake. It’s happened to the Greeks, Romans, Spanish, Dutch, British, and many other civilizations throughout history. The path to destruction is always the same because the actions of humans in large numbers are entirely predictable. The American Empire has exploited all of the productive people, leaving nothing left to invest in the future. Investment by corporate America today constitutes greedy CEOs buying back their stock to boost earnings per share and share price in order to earn multi-million dollar bonuses.

    The globalization scam was the last dying gasp to exploit the dwindling resources of the planet and the people. There is nothing left to fund the bread and circuses keeping the ignorant masses distracted, amused, and fed. The monetary machinations of the Federal Reserve have reached their limit. Economic crisis is inevitable before this Fourth Turning runs its course.

    The economic meltdown will likely result in the final breakup of the American empire. The best laid plans of Deep State billionaire intellectuals will be for naught. The law of large numbers will win again. All empires eventually die, and life will go on, unless the psychopaths controlling this country blow the planet up rather than relinquish their wealth and power. Is history already written or do we as individuals have a say?

    “Throughout you have invariably relied on authority or on the past—never on yourselves.” – Isaac Asimov, Foundation

    “But Empire building also bears the seeds of its own destruction. The closer a state comes to the ultimate goal of world domination and one-world government, the less reason is there to maintain its internal liberalism and do instead what all states are inclined to do anyway, i.e., to crack down and increase their exploitation of whatever productive people are still left.

    Consequently, with no additional tributaries available and domestic productivity stagnating or falling, the Empire’s internal policies of bread and circuses can no longer be maintained. Economic crisis hits, and an impending economic meltdown will stimulate decentralizing tendencies, separatist and secessionist movements, and lead to the break-up of Empire. We have seen this happen with Great Britain, and we are seeing it now, with the US and its Empire apparently on its last leg.” – Hans-Hermann Hoppe

     

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Mar 29

Today’s News 29th March 2017

  • Giulio Meotti: Islam, Not Christianity, Is Saturating Europe

    Authored by Giulio Meotti via The Gatestone Institute,

    • Jihadists seem to be leading an assault against freedom and against secular democracies.
    • Sunni Islam's most prominent preacher, Yusuf al Qaradawi, declared that the day will come when, like Constantinople, Rome will be Islamized.
    • It is Islam, not Christianity, that now saturates Europe's landscape and imagination.

    According to US President Trump's strategic advisor Steve Bannon, the "Judeo-Christian West is collapsing, it is imploding. And it's imploding on our watch. And the blowback of that is going to be tremendous".

    The impotence and the fragility of our civilization is haunting many Europeans as well.

    Europe, according to the historian David Engels will face the fate of the ancient Roman Republic: a civil war. Everywhere, Europeans see signs of fracture. Jihadists seem to be leading an assault against freedom and against secular democracies. Fears occupy the collective imagination of Europeans. A survey of more than 10,000 people from ten different European countries has revealed increasing public opposition to Muslim immigration. The Chatham House Royal Institute of International Affairs carried out a survey, asking online respondents their views on the statement that "all further migration from mainly Muslim countries should be stopped". In the 10 European countries surveyed, an average of 55% agreed with the statement.

    Mainstream media are now questioning if "Europe fears Muslims more than the United States". The photograph used in the article was a recent Muslim mass prayer in front of Italy's monument, the Coliseum. In echoes of the capture of the great Christian civilization of Byzantium in Constantinople, Sunni Islam's most prominent preacher, Yusuf al Qaradawi, declared that the day will come when Rome will be Islamized.

    Hundreds of Muslims engage in a mass prayer service next to the Coliseum in Rome, on October 21, 2016. (Image source: Ruptly video screenshot)

    Do civilizations die from outside or inside? Is their disappearance the result of external aggression (war, natural disasters, epidemics) or of an internal erosion (decay, incompetence, disastrous choices)? Arnold Toynbee, in the last century, was adamant: "Civilizations die from suicide, not by murder".

    "The contemporary historian of ancient Greece and ancient Rome saw their civilisations begin their decline and fall, both the Greeks and the Romans attributed it to falling birth rates because nobody wanted the responsibilities of bringing up children," said Britain's former chief rabbi, Lord Sacks.

    Everywhere in Europe there are signs of a takeover.

    Muslim students now outnumber Christian students in more than 30 British church schools. One Anglican primary school has a "100 percent Muslim population". The Church of England estimated that about 20 of its schools have more Muslim students than Christian ones, and 15 Roman Catholic schools have majority Muslim students. In Germany as well, there are fears of a massive Muslim influx into the school system, and German teachers are openly denouncing the threat of a "ghettoization".

    France saw 34,000 fewer babies born last year than in 2014, a new report just found. The number of French women having children has reached its lowest level in 40 years. A low fertility rate has become a plague all over Europe: "In 1995 only one country, Italy, had more people over 65 than under 15; today there are 30 and by 2020 that number will hit 35." Welcome to the "Greying of Europe".

    Additionally, if it were not for Muslim women, France would have an even lower birth rate: "With a fertility rate of 3.5 children per woman, the Algerians contribute significantly to the growth of the population in France", wrote the well-known demographer Gérard-François Dumont.

    Thanks to Muslim migrants, Sweden's maternity wards are busy these days.

    In Milan, Italy's financial center, Mohammed is the top name among newborn babies. The same is true in London, in the four biggest Dutch cities and elsewhere in Europe, from Brussels to Marseille. It is Islam, not Christianity, that now saturates Europe's landscape and imagination.

    Meanwhile, Europe's leaders are almost all childless. In Germany, Angela Merkel has no children, as British prime minister Theresa May and one of France's leading presidential candidates, Emmanuel Macron. As Europe's leaders have no children and no reason to worry about the future (everything ends with them), they are now opening Europe's borders to keep the continent in a demographic equilibrium. "I believe Europeans should understand that we need migration for our economies and for our welfare systems, with the current demographic trend we have to be sustainable", said Federica Mogherini, the European Union representative for foreign affairs.

    The Battle of Tours in 732 was the high-water point of the Muslim tide in Western Europe. If Christians had not won, "perhaps," wrote Edward Gibbon, "the interpretation of the Koran would now be taught in the schools of Oxford, and her pulpits might demonstrate to a circumcised people the sanctity and truth of the revelation of Mahomet". Does that sound familiar these days?

    Islamists take culture and history more seriously than the Westerners do. Recently, in Paris, an Egyptian terrorist tried to strike the great museum, the Louvre. He planned to deface the museum's artwork, he said, because "it is a powerful symbol of French culture". Think about an Islamic extremist shouting "Allahu Akbar" while slashing the Mona Lisa. This is the trend we need to start reversing.

  • The Transformation Of Our Nation Into A Surveillance State Is Almost Complete

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

    The headlines are awash with the recent tensions with North Korea, and most are focused intently upon this act of the play that has been running hot for several years, now.  Akin to the proverbial frog in cold water, however, we are not paying as much attention to the surveillance state that is continuing to wrap its tentacles around us.  Eurasia is our ally, Eastasia is our enemy…and nobody notices that the chocolate ration has been diminished.  While everyone focuses on what is reported in the headline news, everybody misses what is happening right before their eyes.

    Point of Sale is the new jail, the ubiquitous surveillance system that records your every purchase and stores it in a personal database…an algorithm…in the government storage facility in Utah.  Look above that register.  It doesn’t matter whether you have a debit or credit purchase or not.  Paying cash?  Your anonymity only lasts until your image is captured in the little black dome camera right above your head…right next to the register.  The sale is recorded, as well as your image.

    Now the biometrics are becoming advanced enough to be able to measure the spacing between your eyes, the shapes of the ears, and other idiosyncrasies that are peculiar to each individual.  But these differences do not matter, as long as they can be catalogued.   All the states pretty much have Real ID, now, with driver’s licenses all linked into a central database and passed through the fusion centers and police departments at local, state, and national level.  1984 is now.

    Here is an excerpt from the Passports page of the State Department of January 12, 2016:

    The Department of Homeland Security (DHS) announced Friday that Real ID-compliant identification, such as a passport or a driver’s license from a Real ID-compliant state, will not be required to fly domestically until 2018.

    Yes, this is serious.  Laws are not in place yet to prevent you from disguising yourself or altering your appearance.  Yet.  They do make it a crime to alter your appearance in the commission of a crime.  The question becomes when do they make it a crime to vary from their THX-1138 program for us and keep them from recording you?  Probably very soon.

    In previous articles, it was mentioned that it is a rollercoaster with the administrations and the amount they can push the peoples’ perceptions of what is intolerable.  As many of you have pointed out, the political party doesn’t matter…the surveillance state inches forward in increments: steadily and without respite.  We are in a “slow” phase right now.  President Trump is “in,” and the people are riding the crest of their “newfound freedoms,” right?  Not so fast.  Bush Jr. was certainly better than Clinton; however, his actions enabled the Warner Defense Act of 2006 and the abrogation of Constitutional rights in that 100-mile buffer zone around the Continental United States.  The Patriot Act had already been in place, and many refinements were made to alter limitations on presidential actions concerning disclosure on actions overt and covert initiated by the Commander-in-Chief.

    Obama came in and took the driver’s seat, and took away so many more of our individual rights and protections that the staggering populace is just now beginning to realize exactly what he did.  Those actions have not been negated, and may even be promulgated.  Most of the limaceous public is unaware, because the handouts and entitlements keep them stultified and obedient to whatever politician throws them the free Gaines Burgers.

    The surveillance state is almost ubiquitous, and it has been made so through the efforts of our own complacencies.

    Let us return to the point of sale.  It isn’t simply for “inventory.”  The main reason these corporations claim to store your demographics is for “marketing purposes,” but all of them are (at a minimum) “back-doored” by the NSA and other agencies who are scanning your information.  They also have that cellular telephone to work with…the one that transmits a “pulse” every 4 seconds and stores information…metadata for large groups of people or geographic peculiarities…and personal information.

    The happy cell phone is off and in your blazer, but it has sent a pulse out with your GPS location…in front of Cabela’s.  When you go in and buy the ammo?  The camera records your image and there’s a tie-in with the real-time purchase on your receipt.  You’re known.  Your vehicle is known, your itinerary for the day is known.  It is also recorded.

    All your shopping habits, everywhere you drive, where you shop for gas, and stop for a coffee break.  All the cameras are recording.  In addition, our fellow citizens, the “Muppets” are always communicating with you and photographing things with their little cameras.  All of your activities, all of your banking, your entire life’s actions are all right there for them to paint a picture of you…and catalogue you for a later date…information stored and ready at their fingertips to access.

    Edward Snowden spilled the beans concerning the surveillance that is becoming even more out of control.  The satellites are being fine-tuned and honed, and it is occurring all over the world.  Whole generations are being taught to conform now, while they are in their youth…in the schools, that are merely cages where children are taught only what they need to be functional.  Children are made into obedient little beasts of conformity that can be controlled later…later, by those with power and money who were schooled to think creatively and to actually think, instead of regurgitating useless bits of information.

    The funding for all of these actions come right from our taxes.  We pay our jailers to create larger, more ingenious prisons to control us.  Eventually come the chains for the ankles, and the abattoir materializes.  There is less of a gap between total surveillance and “Soylent Green” than most people realize.  For a good read, check out an older article written by Brandon Smith entitled Low-Tech Solutions for High-Tech Tyranny.  It’s a good “starter piece” for your consideration if you have not thought of these things.  Pick up Citizen Four, a documentary about Edward Snowden.

    This stuff is happening now.  Just because we are rid of Obama does not mean we are rid of the Globalist agenda and the transformation of our nation into a complete surveillance state.  It is almost in place.  Almost.  The important thing is to know about it and not be lulled into a false sense of security that all is well, when it is not.  It hasn’t happened yet, but “yet” can mean that it happens tomorrow.  It is going to depend on us: seeing it for what it is, and refusing to go “gently into that good night.”

  • "Something Stinks Here" – CrowdStrike Revises, Retracts Parts Of Explosive Russian Hacking Report

    Authored by Mike Krieger via Liberty Blitzkrieg blog,

    Last week, I published two posts on cyber security firm CrowdStrike after becoming aware of inaccuracies in one of its key reports used to bolster the claim that operatives of the Russian government had hacked into the DNC. This is extremely important since the DNC hired CrowdStrike to look into its hack, and at the same time denied FBI access to its servers.

    Before reading any further, you should read last week’s articles if you missed them the first time.

    Credibility of Cyber Firm that Claimed Russia Hacked the DNC Comes Under Serious Question

    What is CrowdStrike? Firm Hired by DNC has Ties to Hillary Clinton, a Ukrainian Billionaire and Google

    Now here are the latest developments courtesy of Voice of America:

    U.S. cybersecurity firm CrowdStrike has revised and retracted statements it used to buttress claims of Russian hacking during last year’s American presidential election campaign. The shift followed a VOA report that the company misrepresented data published by an influential British think tank.

     

    In December, CrowdStrike said it found evidence that Russians hacked into a Ukrainian artillery app, contributing to heavy losses of howitzers in Ukraine’s war with pro-Russian separatists.

     

    VOA reported Tuesday that the International Institute for Strategic Studies (IISS), which publishes an annual reference estimating the strength of world armed forces, disavowed the CrowdStrike report and said it had never been contacted by the company.

     

    CrowdStrike was first to link hacks of Democratic Party computers to Russian actors last year, but some cybersecurity experts have questioned its evidence. The company has come under fire from some Republicans who say charges of Kremlin meddling in the election are overblown.

     

    After CrowdStrike released its Ukraine report, company co-founder Dmitri Alperovitch claimed it provided added evidence of Russian election interference. In both hacks, he said, the company found malware used by “Fancy Bear,” a group with ties to Russian intelligence agencies.

     

    CrowdStrike’s claims of heavy Ukrainian artillery losses were widely circulated in U.S. media.

     

    On Thursday, CrowdStrike walked back key parts of its Ukraine report.

     

    The company removed language that said Ukraine’s artillery lost 80 percent of the Soviet-era D-30 howitzers, which used aiming software that purportedly was hacked. Instead, the revised report cites figures of 15 to 20 percent losses in combat operations, attributing the figures to IISS.

     

    Finally, CrowdStrike deleted a statement saying “deployment of this malware-infected application may have contributed to the high-loss nature of this platform” — meaning the howitzers — and excised a link sourcing its IISS data to a blogger in Russia-occupied Crimea.

     

    In an email, CrowdStrike spokeswoman Ilina Dmitrova said the new estimates of Ukrainian artillery losses resulted from conversations with Henry Boyd, an IISS research associate for defense and military analysis. She declined to say what prompted the contact.

     

    Dmitrova noted that the FBI and the U.S. intelligence community have also concluded that Russia was behind the hacks of the Democratic National Committee, Democratic Congressional Campaign Committee and the email account of John Podesta, Hillary Clinton’s campaign manager.

    Here’s the problem. Yes, the FBI has agreed with CrowdStrike’s conclusion, but the FBI did not analyze the DNC servers because the DNC specifically denied the FBI access. This was noteworthy in its own right, but it takes on vastly increased significance given the serious errors in a related hacking report produced by the company.

    As such, serious questions need to be asked. Why did FBI head James Comey outsource his job to CrowdStrike, and why did he heap praise on the company? For instance, back in January, Comey referred to CrowdStrike as a “highly respected private company.”

    In a hearing with the Senate Intelligence Committee Tuesday afternoon outlining the intelligence agencies’ findings on Russian election interference, Comey said there were “multiple requests at different levels” for access to the Democratic servers, but that ultimately a “highly respected private company” was granted access and shared its findings with the FBI.

    Where does all this respect come from considering how badly it botched the Ukraine report?

    Something stinks here, and the FBI needs to be held to account.

  • LA, Chicago, & New York Vow To Defy Trump Over Sanctuary City De-Funding

    "We are going to become this administration's worst nightmare." Leading officials from Los Angeles, Chicago, and New York have come out swinging a day after AG Sessions demanded yesterday that the country's so-called 'Sanctuary Cities' stop breaking Federal laws (or their funding will be cut, or worse).

    Attorney General Jeff Sessions made the surprise appearance at Sean Spicer's daily White House press briefing to announce that his DOJ will be taking steps to not only require that so-called "sanctuary cities" enforce federal immigration laws but would also be seeking to claw back past DOJ awards granted to those cities if they refuse to certify compliance.

    "Today, I'm urging states and local jurisdictions to comply with these federal laws.  Moreover, the Department of Justice will require that jurisdictions seeking or applying for DOJ grants to certify compliance with 1373 as a condition for receiving those awards."

     

    "This policy is entirely consistent with the DOJ's Office of Justice Programs guidance that was issued just last summer under the previous administration."

     

    "This guidance requires jurisdictions to comply and certify compliance with Section 1373 in order to be eligible for OJP grants.  It also made clear that failure to remedy violations could result in withholding grants, termination of grants and disbarment or ineligibility for future grants."

     

    "The DOJ will also take all lawful steps to claw back any fines awarded to a jurisdiction that willfully violates Section 1373."

     

    //platform.twitter.com/widgets.js

    Sessions' demands were not well met by the major cities' leaders…

    New York was vocal...

    "We are going to become this administration's worst nightmare," said New York City Council Speaker Melissa Mark-Viverito, who was among officials gathered in New York for a small conference that attracted officials from cities including San Francisco, Seattle, Denver, Chicago, Philadelphia and New York.

     

    Mark-Viverito and others promised to block federal immigration agents from accessing certain private areas on city property, to restrict their access to schools and school records and to offer legal services to immigrants in the country illegally.

    California was angry…

    California Senate leader Kevin de León called Sessions' message, "nothing short of blackmail. … Their gun-to-the-head method to force resistant cities and counties to participate in Trump's inhumane and counterproductive mass-deportation is unconstitutional and will fail."

     

    Mayor Eric Garcetti said Monday he will fight efforts by the Trump administration to take away federal funding needed for law enforcement in Los Angeles.

     

    Garcetti said that such actions would be unconstitutional, adding that the city’s policies are “designed to keep our residents safe.”

     

    “Slashing funds for first-responders, for our port and airport, for counterterrorism, crime-fighting and community-building serves no one — not this city, not the federal government, not the American people,” he said. “We will fight to protect the safety and dignity of all Angelenos, and we will work closely with our representatives in Congress to make sure that Los Angeles does not go without federal resources that help protect millions of people every day.”

    And Chicago was welcoming… to immigrants…

    Mayor Rahm Emanuel doubled down on his own promise that Chicago will “continue to welcome” immigrants.

     

    "I've always seen Chicago as a welcoming city,” Emanuel said in an interview from the Nasdaq stock exchange in New York on Monday.

     

    “It welcomed my grandfather 100 years ago, we continue to welcome entrepreneurs, immigrants, and I would just say think of it this way: Half the new businesses in Chicago and the state of Illinois come from immigrants, nearly half,” he added. “Half the patents at the University of Illinois come from immigrants, and so we want to continue to welcome people, welcome their ideas, welcome their families to the city of Chicago, who want to build the American dream for their children and their grandchildren.”

    As a reminder, in Sessions' view, these cities "make our nation less safe by putting dangerous criminals back on our streets."

    We are sure the tax-paying people of these great cities will be happy to support more taxation to pay for that loss of safety.

    Under Trump’s order, mayors defending their sanctuary city status are essentially imposing a defiance tax on local residents. On average, this tax amounts to $500 per man, woman and child. Major cities like Washington, D.C., New York and Chicago have the most to lose, and nearly $27 billion is at stake across the country.

    Here are the top 10 takeaways from our findings:

    1. $26.741 billion in annual federal grants and direct payments flowed into America’s 106 sanctuary cities (FY2016).
    2. On average, the cost of lost federal funding for a family of four residing in one of the 106 sanctuary cities is $1,810 – or $454 per person. A total population of 46.2 million residents live in the 106 sanctuary cities according to census data.
    3. Washington, D.C., and Chicago, Illinois governments received the highest amount of federal funding per resident and, therefore, have the most to lose by maintaining their sanctuary status.Washington, D.C. municipal government received the highest amount of federal funding on a per capita basis: $3,228 per person; $12,912 per family of four; or $2.09 billion total. The City of Chicago, IL received the second highest amount of federal funding on a per capita basis: $1,942 per person; $7,768 per family of four; or $5.3 billion total.
    4. In cities with populations of 100,000 and above, the communities with the least per capita federal dollars ‘at risk’ are St. Paul, Minnesota ($47 per person, $14.2 million total); Downey, California ($36 per person, $4.2 million total) and Miami, Florida ($67 per person, $29.7 million total).
    5. $15.983 billion in federal funds flowed into just twelve major American cities where 1 in 5 illegal entrants reside (FY2016).
    6. Department of Justice grants to law enforcement – i.e. city police departments – totaled $543.97 million (FY2016). Typically, this funding was only a small percentage of the local law enforcement budgets.
    7. $4.23 billion in federal funding of the 106 sanctuary cities flowed via the ‘direct payment’ type. These payments funded municipal services such as housing, education, community development, and schools.
    8. $21.5 billion in federal funding of the 106 sanctuary cities flowed via the ‘grant’ payment mechanism. These payments funded local police and fire departments, schools, housing, and city services.
    9. In Los Angeles, fully 1 in 5 city residents (22-percent) are illegal entrants. However, the amount of federal funding amounts to only $126 per resident; $504 per family of four; or $502.5 million total.
    10. In Newark, New Jersey, 19-percent of city residents are undocumented entrants. However, the amount of federal funding amounts to $733 per resident; $2,932 per family of four; or $206.7 million.

    The threat of losing nearly $27 billion in federal funding seems to be having an effect on some cities. In fact, Miami already reversed their sanctuary city policy.

  • Foundation & Empire – Is Donald Trump 'The Mule'?

    Authored by Jim Quinn via The Burning Platform blog,

    In Part One of this article I analyzed the similarities of Isaac Asimov’s Foundation Trilogy to Strauss & Howe’s Fourth Turning, trying to assess how Donald Trump’s ascension to power fits into the theories put forth by those authors. Now I will compare Trump to the most interesting character in Asimov’s classic – The Mule.

    The Mule

    “A horse having a wolf as a powerful and dangerous enemy lived in constant fear of his life. Being driven to desperation, it occurred to him to seek a strong ally. Whereupon he approached a man, and offered an alliance, pointing out that the wolf was likewise an enemy of the man. The man accepted the partnership at once and offered to kill the wolf immediately, if his new partner would only co-operate by placing his greater speed at the man’s disposal. The horse was willing, and allowed the man to place bridle and saddle upon him.

    The man mounted, hunted down the wolf, and killed him. “The horse, joyful and relieved, thanked the man, and said: ‘Now that our enemy is dead, remove your bridle and saddle and restore my freedom.’ “Whereupon the man laughed loudly and replied, ‘Never!’ and applied the spurs with a will.” – Isaac Asimov, Foundation

    I had not thought about the Foundation Trilogy for decades, until someone recently mentioned it in a comment on my website. They pondered whether Trump’s arrival on the scene represented The Mule’s advent during the decline of the Galactic Empire. Trump’s numerous enemies would love to portray him as an evil mutant freakish warlord, bent on using his persuasion powers to mislead the populace into doing his bidding. I don’t necessarily see Trump as The Mule, but as a disrupting factor, disturbing the best laid plans of the establishment and helping reveal the hidden agendas of the Deep State.

    Seldon’s science of psychohistory was outstanding at predicting the behavior of large populations but worthless in trying to predict what an individual might do. The emergence of the Mule, a mentalic mutant with an acute telepathic ability to modify the emotions of human beings, could not have been predicted by the Seldon Plan, focused as it was on the statistical movements of vast numbers of peoples and populations across the galaxy.

    The Mule was the unpredictable variable in the equations of history and the greatest threat to the Seldon Plan. He disrupts the inevitability of the continued evolution of the First Foundation and potential early ending of the Dark Age. The Mule, through telepathic manipulation, defeats and takes over the Foundation’s growing empire, which has become increasingly control-oriented and out-of-touch with the outer planets in its rapidly expanding realm of influence.

    There are certainly parallels between Trump’s arrival on the scene and The Mule’s psychohistory defying disruption of Seldon’s Plan. The Mule was described as a freak and the subject of derision. This fueled his ambition to take over the galaxy. I believe Trump decided he was going to be president on April 30, 2011 during the Correspondence Dinner at the White House when Obama unrelentingly mocked and derided him in front of the corrupt Washington power establishment. This public ridicule from an empty suit community organizer president, who never worked a real day in his life, angered Trump to his core and propelled him to seek and win the presidency.

    The Mule enters the scene disguised as a clown named Magnifico Giganticus. Over time, he uses his psycho-manipulative abilities to sway the masses to his side and eventually takes over the galaxy. When Trump announced his candidacy, it was taken as a public relations stunt to further his faltering reality TV career. He has a magnificent gigantic ego. His persona was that of an irascible self-made billionaire with an enormous ego and hunger for the spotlight. He was the butt of many orange hair and orange skin jokes.

    For the most part, he went along with the joke, as any publicity is good publicity when you are selling yourself as a brand. He put his name on buildings, Chinese made clothing, scam universities, and just about anything that would produce a buck. He became more famous for his TV show The Apprentice, and his tag-line “You’re Fired”, than for the billion dollar real estate empire he had built.

    Like The Mule, Trump used the GOP establishment’s disdain and underestimation of his persuasion abilities to capture control of the party from the out of touch elitist party hacks. At the outset of his candidacy I was among the libertarian minded skeptics who didn’t take him seriously. I found him entertaining, but didn’t think he had the gravitas to be president. I liked his rhetoric about not interfering in foreign conflicts, protecting our borders, enforcing the rule of law, repealing the disastrous Obamacare law, and his relentless trashing of the left wing mainstream media and Washington establishment.

    I wasn’t a big fan of his bloviating about inconsequential matters. As time passed I began to realize he was probably the Grey Champion of this Fourth Turning and the regeneracy towards the next phase would be his unexpected election to the highest office in the land. He was the only person capable of destroying the fetid pustule known as the Deep State.

    The Mule’s tormented childhood of alienation, combined with his mental ability to alter human emotions led to his desire for power, in order to exact revenge upon the human race which caused him so much pain. Trump’s childhood was no walk in the park, but it was far from being tortured. His father did send him to military school at the age of 13 to instill some discipline in him. It does seem like his drive to succeed was spurred by a desire to prove himself to his father and be more successful than his old man. Unlike The Mule, his motivation is not revenge motivated, unless you consider it revenge upon Obama for the abuse he withstood during that dinner.

    The Mule had the mental capabilities to turn antagonists into followers, converting feelings of animosity into those of intense loyalty. He could also stimulate feelings of pervasive fear and panic among his enemies. He used the subtle influence of the subconscious to conscript individuals to his cause. The Mule used his mental powers to disrupt Seldon’s plan by invalidating his assumption no single individual could have a quantifiable impact on historical trends predicted by his theory of psychohistory. The Mule is a Grey Champion-like character rising to power at a crucial time in history as the disruptive factor to the best laid plans of over-confident elitists. The Mule uses his extraordinary cerebral abilities to conquer the unprepared and over-confident Foundation.

    Trump has been underestimated every step of the way for the last two years. He has thrown sand into the gears of the political establishment, made up of both parties, and controlled by Deep State players used to getting their way. Trump was able to use his powers of persuasion to overcome the left wing media propaganda and motivate a large swath of disaffected Americans to come over to his side. The never ending barrage of misinformation and fake news spewed by the Deep State controlled media ignores the fact he won 53% of the white women vote, along with huge numbers of union workers from blue collar states like Michigan, Ohio, Wisconsin, Pennsylvania, and Indiana.

    As documented during the campaign by Scott Adams, Trump’s phenomenal power of persuasion overcame all obstacles thrown in his way by the crooked establishment. He had no support from the GOP power players, was despised and ridiculed by the horribly corrupt Democratic establishment machine, scorned and mocked by the fake news corporate media, and undermined by the surveillance apparatus at the behest of the rancid resentful reprobate occupying the oval office. Their pure unadulterated hatred for the man resulted in them becoming blindsided and baffled by his tactics, strategy, and Svengali-like ability to draw huge crowds of normal Americans in flyover country.

    Trump has disrupted the ongoing Deep State capture of our political, economic, financial, social, and cultural systems as a once in a lifetime figure destined to govern during a time of domestic disorder, global upheaval, civil chaos and ultimately war on a grand scale. The looting and pillaging campaign of the ruling class, disguised as free market capitalism and democracy, has been put at risk by an uncontrollable unpredictable outsider who doesn’t act according to their Plan.

    The staged violent response by the billionaire funded left wing faux anarchists, fake news Russian conspiracy propaganda, and NSA/CIA/FBI campaign to discredit and/or overthrow the Trump presidency is the kind of response you would expect from a dangerous threatened animal backed into a corner. The establishment will not relinquish control without a bloody drawn out fight to the finish.

    Since we know Asimov modeled the trilogy on Gibbons’ The Decline and Fall of the Roman Empire, there has been much conjecture as to who The Mule represented. He has historical parallels with Attila the Hun, Tamerlane, Charlemagne and Roman Emperor Augustus. Based on the historical time frame in which he was writing (1941 – 1950), I think it is safe to assume he modeled some of The Mule’s traits after Adolf Hitler. His disturbed childhood, trauma during the First World War, hypnotic ability to manipulate the emotions of the German people, boldness in attacking his perceived enemies, and attempt at world conquest, parallels much of The Mule’s story.

    When I try to find parallels to our current situation and the role Trump is playing, I see the Foundation trilogy in a different light. Isaac Asimov was an intellectual. He had a PhD in biochemistry and was a life-long member of Mensa. He was a university professor for most of his life. Academics believe in theories and academic mumbo jumbo, as we can see from decades of academics running the Federal Reserve, destroying our currency and forcing millions into economic servitude.

    Hari Seldon is an intellectual who creates the Foundation, made up of other academic intellectuals. Then he sets up a Second Foundation of even more talented intellectuals as a backup plan in case the Foundation fails. The true ruling powers on this planet always have a backup plan. You never know whether the leaders or organizations you support are really part of a bigger plan you have not considered. Keeping the populace off-balance, confused, and seeking unseen enemies is just part of the plan.

    The inevitable decline of the Galactic Empire was entirely predictable by Seldon, as every empire in world history has ultimately declined. Whether the Roman Empire was ruled by a despot, wise man, or idiot, it continued its centuries long decline from glory to destruction. Empires are created by fallible men whose failings, weaknesses, and desires never change. John Adams foresaw the future of an American Empire two centuries before it became an empire. The American Empire is in the process of committing suicide and a single individual, no matter how bold and resolute, will not be able to save it from its inevitable destruction.

    “I do not say that democracy has been more pernicious on the whole, and in the long run, than monarchy or aristocracy. Democracy has never been and never can be so durable as aristocracy or monarchy; but while it lasts, it is more bloody than either. … Remember, democracy never lasts long. It soon wastes, exhausts, and murders itself. There never was a democracy yet that did not commit suicide. It is in vain to say that democracy is less vain, less proud, less selfish, less ambitious, or less avaricious than aristocracy or monarchy.

    It is not true, in fact, and nowhere appears in history. Those passions are the same in all men, under all forms of simple government, and when unchecked, produce the same effects of fraud, violence, and cruelty. When clear prospects are opened before vanity, pride, avarice, or ambition, for their easy gratification, it is hard for the most considerate philosophers and the most conscientious moralists to resist the temptation. Individuals have conquered themselves. Nations and large bodies of men, never.” – John Adams, The Letters of John and Abigail Adams

    I don’t see Trump as an evil Mule character in this Shakespearian tragedy, as it progresses towards its ill-fated denouement. I also don’t see Seldon and his ensemble of elitist intellectuals as the saviors of the universe. I see The Foundation as the Washington and Wall Street elite who are the face of the establishment – Pelosi, Schumer, Ryan, McConnell, Yellen, Dimon, Blankfein, Immelt, Gates, Buffet, etc. The Second Foundation was hidden in plain sight, operating in the shadows, unknown to the masses, and controlling the galaxy from behind the curtain. They were the Galactic Deep State.

    The Seldon Plan smells like a current day Soros Plan. Wealthy, highly educated, egotistical, hubristic, evil snakes who believe they are the smartest men in the world operate behind the scenes as the invisible government, manipulating the mechanisms of society and pulling the wires controlling the public mind. Soros, along with other shadowy smug billionaires, are not fans of populism.

    They believe they are entitled to run the world as they choose, with no input or resistance from the ignorant masses. With the basket of deplorables rising up and electing Trump, the Deep State players are now openly fighting back and revealing their warped thought process. Elitist billionaire Ray Dalio recently revealed his populism fears and those of his fellow billionaires. He doesn’t consider himself a common man.

    Populism is a political and social phenomenon that arises from the common man, typically not well-educated, being fed up with 1) wealth and opportunity gaps, 2) perceived cultural threats from those with different values in the country and from outsiders, 3) the “establishment elites” in positions of power, and 4) government  not working effectively for them.  These sentiments lead that constituency to put strong leaders in power.  Populist leaders are typically confrontational rather than collaborative and exclusive rather than inclusive.  As a result, conflicts typically occur between opposing factions (usually the economic and socially left versus the right), both within the country and between countries.  These conflicts typically become progressively more forceful in self-reinforcing ways.  

    In other words, populism is a rebellion of the common man against the elites to some extent, against the system. The rebellion and the conflict that comes with it occur in varying degrees. Sometimes the system bends with it and sometimes the system breaks.  Whether it bends or breaks in response to this rebellion and conflict depends on how flexible and well established the system is.  It also seems to depend on how reasonable and respectful of the system the populists who gain power are. Classic populist economic policies include protectionism, nationalism, increased infrastructure building, increased military spending, greater budget deficits, and, quite often, capital controls.

    Dalio, Soros and their fellow billionaires see populism as a threat to their wealth, power, and control of the world. But, it’s much ado about nothing. It’s like jockeying for the best seat on the Titanic as it sinks into the frigid ocean depths of the Atlantic. The American Empire is in shambles and no one can reverse its course at this point. I’ll address that distressing situation in Part Three of this article.

  • New Study Says Robots Took All Of Detroit's Jobs, Not Mexico

    As Trump gets ready to renegotiate NAFTA and impose tariffs on companies looking to outsource production to Mexico, a new study from MIT and Boston University suggests that industrial robots, not Mexico, may be the bigger factor contributing to the high levels on unemployment in the Midwest. 

    Entitled “Robots and Jobs: Evidence From US Labor Markets,” the authors of the study found that the addition of 1 robot per 1,000 workers results in an 18-35 bps reduction in the employment-to-population ratio and 25-50bps reduction in wages.  Per Bloomberg:

    One additional robot per thousand workers reduces the employment-to-population ratio by 0.18 percentage points to 0.34 percentage points and slashes wages by 0.25 percent to 0.5 percent, based on their analysis. To put that in context, the U.S. saw an increase of about one new industrial robot for every thousand workers between 1993 and 2007, based on the study.

     

    “The employment effects of robots are most pronounced in manufacturing, and in particular, in industries most exposed to robots; in routine manual, blue collar, assembly and related occupations; and for workers with less than college education,” the authors write. “Interestingly, and perhaps surprisingly, we do not find positive and offsetting employment gains in any occupation or education groups.”

     

    Worth noting: the authors estimate that robots may have increased the wage gap between the top 90th and bottom 10 percent by as much as 1 percentage point between 1990 and 2007. There’s also room for much broader robot adoption, which would make all of these effects much bigger.

    Robots

     

    While the study found that only 360,000-670,000 jobs had been lost to robots over the past couple of decades, estimates indicate that an additional 3.5 million permanent jobs losses could occur over just the next 10 years which would increase the natural unemployment level by over 2%.

    Because there are relatively few robots in the US economy, the number of jobs lost due to robots has been limited so far (ranging between 360,000 and 670,000 jobs, equivalent to a 0.18-0.34 percentage point decline in the employment to population ratio). However, if the spread of robots proceeds as expected by experts over the next two decades (e.g., Brynjolfsson and McAfee, 2012, especially pp. 27-32, and Ford, 2016), the future aggregate implications of the spread of robots could be much more sizable. For example, BCG (2015) offers two scenarios for the spread of robots over the next decade. In their aggressive scenario, the world stock of robots will quadruple by 2025. This would correspond to 5.25 more robots per thousand workers in the United States, and with our estimates, it would lead to a 0.94-1.76 percentage points lower employment to population ratio and 1.3-2.6 percent lower wage growth between 2015 and 2025.

    Of course, the impact is even more dramatic when you consider that the job losses are heavily concentrated in a handful of industries.  The automotive industry employs 39% of existing industrial robots, followed by the electronics industry (19%), metal products (9%), and the plastic and chemicals industry (9%).
    Robots

     

    Meanwhile, the following maps help to highlight the exposure of various regions of the country to industrial automation, imports and offshoring of jobs.  Not surprisingly, the heaviest concentration of robots has developed in the rust-belt region where they’ve replaced 1,000s of UAW workers.

    Robots

     

     

    Of course, this wouldn’t be the first time that economists had prematurely predicted the demise of labor markets due to technological advances:

    “We are being afflicted with a new disease of which some readers may not have heard the name, but of which they will hear a great deal in the years to come—namely, technological unemployment” – Keynes, 1930

     

    “Labor will become less and less important. . . More and more workers will be replaced by machines. I do not see that new industries can employ everybody who wants a job” – Leontief, 1952

  • Brodsky: "A Socialized Market With Guaranteed Positive Returns For All Must Fail"

    Submitted by Paul Brodsky via Macro-Allocation.com

    “Selfishness is a virtue.”

           – Ayn Rand

    “Selfishness is profitable, but for institutionalized investors it takes courage to be selfish.”

           – Paul Brodsky

    Self-Serve

    In Passive Aggressive, we made the case that ETFs can be useful vehicles for thoughtful active investors. A few people agreed with our self-assessment in the piece that we were being self-serving because we are launching a modestly priced pro-volatility fund that actively manages ETFs. To some this might raise the issue of whether the report was truly objective. It was, and in fact we would argue that opening a fund using the approach endorsed in Passive Aggressive shows our high level of conviction towards it. It would be unconscionable were we not to not share an opportunity we see as worthy of opening a business.

    Objective analysis is objective because the ideas and conclusions are free of bias, not because the analyst is free of a potential conflict of interest. Full-disclosure separates self-interest from self-dealing.
    We have argued recently that US and global output growth are declining fast, Trump’s economic initiatives would have little impact (best case), long-duration Treasuries should be bought and high yield credit sold, gold should be owned, US housing and retail sectors should be shorted, as well as other macro trends and applications. Most of our suggestions have been counter-consensus and would benefit from a general increase in economic and market volatility. By discussing the ETF approach within the context of MAI, it is our hope that subscribers value the overall strategy enough to consider acting on it in some measure, whether it is with us, with someone else, or on their own. But enough about that…

    Who pursues which investment strategies and why got us thinking about a broader question: can an alternative-investment style without widespread acceptance have merit, or should it be avoided by practical investors? The crux of the issue is when should an investor consider an unconventional approach she has not considered before? Our answer: now, at least for a portion of the portfolio.

    A Precarious Setup

    On one level, it is satisfying to watch investors migrate to lower-cost passive investment vehicles because higher-cost active management has consistently under-performed. One might say the market for investment intermediation is rational. One might also argue passive investing is not rational at all because it is not forward looking. Rising markets, an unwillingness to acknowledge fat tails (unlikely knowns), and the inability to model Black Swans (unknown unknowns) have concentrated popular wealth into a narrowly distributed range of highly vulnerable assets and investment strategies.

    The trend towards passive investing implies the preponderance of a type of investment behavior called reflexivity – basically, an established trend begets the continuance of it. This mindset is typically embraced by traders, but less prevalent among investors who generally regard themselves as fundamental long-termers. The irony is that for long-term investors, the broad migration to passive investment vehicles is occurring in full revolt against longer term macroeconomic and commercial fundamentals.

    When we step back and look at the broad macroeconomic setup, characterized by aging populations in the world’s largest economies, declining overall birth rates among the world’s wealth holders, record sovereign and household leverage, the continued economic emphasis of finance over production, the reliance on over-accommodating central banks (even during the Fed’s current rate hike phase), historically high equity, bond and real estate prices and record low asset and liability values (in real terms); we cannot help but conclude that asset prices are generally rising due mostly to inertia, in spite of unreason, and that the most likely outcome will be something unexpected and disappointing.

    Even though it is a rejection of the established secular bull market in assets and the social, economic, political and financial cultures established and tweaked over the span of our career (almost to the day), our heart and mind (not to mention the vast sweep of investment and economic history) tell us structural change is coming. We can use our experience to forecast specific events and new trends that might occur, and we have, but we cannot know exactly what form structural change will take or when it might begin.

    Into the Breach

    A socialized market framework with implicitly guaranteed perpetual positive returns for all must fail. The best approach is to confront the point of criticality head-on, where “wealth” seems to be permanent but is not. Turning popular passive instruments on themselves to take advantage of great market distortions promises to be an aggressive hedge against misguided inertia – an effective portfolio offset that strikes at the belly of the beast. ETFs are here to stay, but their market prices and liquidity profiles are not.

    Serve yourself. All investors and trustworthy market professionals should be expected to act selfishly by seeking to identify and profit from unsustainable distortions. If investors must put that in a more virtuous context to satisfy their consciences (or fiduciary charters), then they can make themselves feel better by knowing that helping to close unsustainable distortions is the only way capitalism can survive. Capitalism without failure is like Catholicism without hell. In this case, investors can do well by doing good if/when market hell arrives.

    Selfishness is profitable, but for institutionalized investors it takes courage to be selfish.

  • House Committee Passes Bill To "Audit The Fed"

    The Republican-controlled Committee on Oversight and Government Reform approved a bill earlier today to allow for a congressional audit of the Federal Reserve’s monetary policy, a proposal Fed policymakers have opposed and likely faces a difficult path to final approval in the Senate.  Under the bill, the Fed’s monetary policy deliberations could be subject
    to outside review by the Government Accountability Office. 

    While similar bills have garnered some support from Democrats in the past, they uniformly spoke against the current proposal during a meeting of the House of Representatives suggesting the current iteration would face stronger resistance from an increasingly polarized environment in Washington D.C..

    The House previously passed similar versions of this legislation twice before in 2012 and 2014, with dozens of Democrats joining nearly unanimous Republican support.  That said, those bills both died in the Senate and likely would have faced a Presidential veto from Obama had they survived anyway.

    That said, Trump expressed interest in passing such legislation multiple times during the 2016 campaign cycle which means the 3rd time might just be the charm for Republicans. 

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    And while proponents of the bill argue that the Fed wields too much power over the U.S. economy with minimal oversight, opponents assert that Fed decisions should be informed purely by economic indicators and completely insulated from “political pressure”…and we presume those same opponents would argue that Yellen’s decision to wait until just after the conclusion of the 2016 Presidential election to start hiking rates had absolutely nothing to do with politics.  Per Reuters:

    Proponents of the measure argue that the Fed is too powerful and lacks sufficient oversight for its interest rate decisions. But Fed officials from Yellen on down, as well as other critics, have warned that such a policy could subject the Fed to undue political pressure and discourage it from taking unpopular steps for the good of the overall economy.

     

    “We should not in any way hinder their independence,” said Representative Carolyn Maloney, a New York Democrat, echoing the sentiment of Fed policymakers who say they could come under political pressure to avoid making unpopular decisions such as raising interest rates to slow growth and control inflation.

    The next step for the bill would be a floor vote by the entire House, where Republicans hold a solid majority, followed by a Senate vote that would be much more difficult given Republcans’ narrow lead.

  • Congress Poised To Obliterate Broadband Privacy Rules

    Authored by Lauren McCauley via TheAntiMedia.org,

     Privacy advocates on Monday are urging Americans to call their elected officials, warning that there are only 24 hours left to “save online privacy rules” before the U.S. House of Representatives votes on a measure that would allow major telecom companies to collect user data and auction it off to the “highest bidder.”

    Wasting no time, the House is expected to begin debate late Monday on S.J. Res. 34, a Congressional Review Act (CRA) resolution to repeal the Federal Communications Commission’s (FCC) privacy provision, implemented under former President Barack Obama, which requires that providers such as Comcast, AT&T, and Verizon get a user’s permission before collecting or selling sensitive data.

    As Common Dreams reported, 50 Republican senators voted to advance the resolution last week.

    “We are one vote away from a world where your [Internet Service Providers or ISP] can track your every move online and sell that information to the highest bidder,” Kate Tummarello, policy analyst for the Electronic Freedom Foundation (EFF), said Monday.

    Explaining how the FCC’s “commonsense” rules would have prevented ISPs from doing a “host of creepy things,” Tummarello wrote: “Those rules were a huge victory for consumers. Of course, the ISPs that stand to make money off of violating your privacy have been lobbying Congress to repeal those rules. Unfortunately, their anti-consumer push has been working.”

    Meanwhile, the opposition is responding with a campaign of its own to pressure lawmakers—said to be in the pocket of the telecom industry—to protect #broadbandprivacy.

    On Monday, the grassroots advocacy Fight for the Future announced that it will unleash billboards in Washington, D.C. and other select districts exposing any Congress member who votes to gut internet privacy rules.

    “Congress should know by now that when you come for the internet, the internet comes for you,” said Evan Greer, the organization’s campaign director, who added that “these billboards are just the beginning. People from across the political spectrum are outraged, and every lawmaker who votes to take away our privacy will regret it come Election Day.”

    Similarly, encrypted communications provider Private Internet Access has taken out a full-page ad in the New York Times naming the senators who “voted to monitor your internet activity for financial gain.”

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    Meanwhile, in a series of tweets, the American Civil Liberties Union (ACLU) enumerated on the implications of the resolution, concluding that House lawmakers should “stand up against industry pressure to put profits over privacy & reject the resolution to overturn the FCC’s privacy rule.”

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    Further, Muhammad Saad Khan at The Next Web explained how a rollback of privacy rules could usher in a new wave of cyber attacks.

    “Considering what is at stake here, and how much data ISPs already have on us, it will not come as a surprise if in the long run, the number of cyberattacks increase by leaps and bounds,” Khan wrote. “Monitoring activities and data theft will rise significantly, as if they were already not a menace. With gadgets, households and even cars being connected to the internet as part of the IoT (the Internet of Things), it is not that hard to imagine how deadly a cyberattack could possibly be if things turn for the worst; which they will, as history suggests.”

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