Today’s News 1st June 2017

  • Forget Peace & Stability – Washington's Policy In The South China Sea Is Confrontational

    Authored by Brian Cloughley via The Strategic Culture Foundation,

    The American guided missile destroyer USS Dewey was reported as having carried out a ‘freedom of navigation operation’ or FONOP in the South China Sea on May 24. According to the US Naval Institute the undertaking involved manoeuvres «within 12 nautical miles of Mischief Reef for about 90 minutes zig-zagging in the water near the installation. At one point during the operation, the ship’s crew conducted a man overboard drill».

    Mischief Reef is 900 miles from the mainland of China, and 12,000 miles from the mainland of the United States. It has been built up by China from a sandy pile of rock into a habitable base and lies in the Spratly Island chain which is claimed by the Philippines and Vietnam, both members of the Association of South East Asian Nations, ASEAN.

    A week before the United States sent a warship to «demonstrate that Mischief Reef is not entitled to its own territorial sea regardless of whether an artificial island has been built on top of it» there was a meeting attended by representatives of China and all ten ASEAN countries. The purpose was to continue discussions aimed at establishing a code of conduct in the South China Sea, and on May 18 an announcement of progress was made. It was stated that all concerned nations «uphold using the framework of regional rules to manage and control disputes, to deepen practical maritime cooperation, to promote consultation on the code [of conduct] and jointly maintain the peace and stability of the South China Sea».

    As stated by the head of the Chinese delegation, deputy foreign minister Liu Zhenmin, «the draft framework contains only the elements and is not the final rules, but the conclusion of the framework is a milestone in the process and is significant. It will provide a good foundation for the next round of consultations». It wasn’t a breakthrough in agreeing about allocation of territory or anything like that — but it was indicative of peaceful progress in an important matter affecting regional countries.

    In 2012 the countries involved had agreed that «the adoption of a code of conduct in the South China Sea would further promote peace and stability in the region» and issued a statement that included reaffirmation of «their commitment to the purposes and principles of the Charter of the United Nations, the 1982 UN Convention on the Law of the Sea, the Treaty of Amity and Cooperation in Southeast Asia, the Five Principles of Peaceful Coexistence, and other universally recognized principles of international law which shall serve as the basic norms governing state-to-state relations».

    All these countries are, of course, signatories to the UN Convention on the Law of the Sea (UNCLOS) which, according to the Voice of America «provides guidelines for how nations use the world's seas and their natural resources. It also contains mechanisms for addressing disputes».

    But the United States of America, whose coast is 12,000 miles from the South China Sea where its ships zig-zag in ‘Freedom of Navigation’ operations, and its electronic warfare aircraft roam the skies forcing China to activate its mainland defensive radars so that they can be identified as future targets, refuses to sign the UN Convention on the Law of the Sea.

    The Berkeley Journal of International Law notes perceptively that «Although ratification of UNCLOS is unlikely today given staunch opposition to it in the Senate, the treaty remains an essential instrument of international law, particularly for resolving international maritime disputes. America’s abstention from the treaty is significant in this context, since as the preeminent naval power in the world it should hold a leading role in shaping the law of the sea. Instead, other nations are playing a larger role». But the US Senate is not known for a logical approach to international affairs, and its reaction is usually confrontational.

    On May 10, just before the China-ASEAN conference and the zig-zagging antics of the USS Dewey, several US senators, including the chairman of the Foreign Relations Committee, wrote to President Trump expressing concern that the US Navy had not carried out patrols «upholding freedom of navigation» in the South China Sea since October 2016. This caused them to «urge your administration to take necessary steps to routinely exercise freedom of navigation and overflight in the South China Sea, which is critical to US national security interests and to peace and prosperity in the Asia-Pacific region».

    There has been no instance of any international commercial vessel being in any way denied passage through the South China Sea. There has never been a case in which any nation in the world has had cause to protest that one of its transiting merchant ships has been approached or in any fashion intimidated, endangered or even mildly disconcerted by the actions of a Chinese warship. There hasn’t been a single Chinese zig-zag.

    These US Senators appear unable to understand that for China to take such action would be economically disastrous. The New York Times records that «$5.3 trillion worth of goods moves through the sea every year, which is about 30 percent of global maritime trade. That includes huge amounts of oil and $1.2 trillion worth of annual trade with the United States». Surely these representatives of the American people, elected presumably because of their outstanding levels of intelligence, flexibility, shrewdness, self-discipline and overall integrity, can see that if there were any real threat to passage of mercantile craft in the South China Sea there would be a catastrophic impact on making profits?

    Even if they are not intelligent or shrewd or possess any of the other qualities desirable in a national legislator, they should realise that if the world’s financial community thought there was a threat to merchant ships in the South China Sea then insurance rates would go through the roof. There would be worldwide rocketing of commodity prices and a massive financial crisis. That is basic enough for even the dumbest senator to understand.

    The only overflights in the region that have drawn attention have been the coat-trailing provocative electronic warfare missions of US military aircraft. There has not been one occasion on which an overflying civil aircraft has experienced interference of any sort.

    Maintenance of peace and furtherance of prosperity of the region are being handled satisfactorily by regional countries, as demonstrated by the recent amicable gathering of Asian nations who agreed to «jointly maintain the peace and stability of the South China Sea». The major problem in the region is interference by warships and military aircraft of the United States. There is little doubt that China’s deputy foreign minister had his tongue firmly in his cheek when he told the media he hoped the China-ASEAN consultations would not be «subject to any outside interference», because he knew very well that cordial agreement between China and other Asian nations concerning the South China Sea would be anathema to Washington.

    The Congress and the Pentagon are marching in step, as evidenced by the declaration of the senators that «We are encouraged by the statement made by Admiral Harry Harris, Commander of US Pacific Command, during his testimony before the Senate Armed Services Committee on April 26, that he expects new FONOPs to take place soon. We also share Admiral Harris’s assessments that ‘China’s militarization of the South China Sea is real’ and that ‘China continues its methodical strategy to control the South China Sea’».

    Much of the world believes that the United States, 12,000 miles from the South China Sea, is the country that wants to control it. Methodical strategy might be the way to go about it, but as we have seen in the swathe of nations from Afghanistan to Libya, by way of Iraq and Syria, the strategy of the United States is not methodical. But it is decidedly confrontational. And disastrous.

  • The Meme Wars Continue: Don Trump Jr. Throws Salt at Hillary's Attempt at Humor

     

    Content originally published at iBankCoin.com

    Last night President Trump typed in a word ‘covfefe’, which lit the internet ablaze. Obviously, we can’t have this man have access to the nuke codes.

    Some believe Trump say on his phone in a drunken stupor and wrongly typed indiscernible words into this phone. Libshits were swinging from vines, attempting humor at the President’s expense. Since then, translations of the mysterious word have surfaced.

    The White House said the word was typed on purpose and that they knew what it meant. Either way, this is juvenile horseshit.

    Alas, Hillary Clinton attempts to capitalize on grande stupidity, taking her cool factor from -10 to -100.

    //platform.twitter.com/widgets.js

    Don Trump Jr. checked and mated her. Game, set, match.

    //platform.twitter.com/widgets.js

  • Russian Lawmaker Issues Sobering Threat: We're Willing To Use Nukes To Defend Crimea

    Authored by Mac Slavo via SHTFplan.com,

    As of late, the media has forgotten about tensions between Ukraine, NATO, and Russia. Crimea and the conflict in Eastern Ukraine have largely left the public’s awareness. However, that shouldn’t be the case, because this region is still a powder keg that could blow at any time. And if it does, it could easily result in another world war.

    If you don’t think the situation in Ukraine could still explode into a wider conflict, take a look at what this member of Russia’s parliament recently said at an international security conference.

    “On the issue of NATO expansion on our borders, at some point I heard from the Russian military — and I think they are right — If U.S. forces, NATO forces, are, were, in the Crimea, in eastern Ukraine, Russia is undefendable militarily in case of conflict without using nuclear weapons in the early stage of the conflict,” Russian parliamentarian Vyacheslav Alekseyevich Nikonov told attendees at the GLOBSEC 2017 forum in Bratislava, Slovakia.

     

    Russian military leaders have discussed Moscow’s willingness to use nuclear weapons in a conflict with military leaders in NATO, as part of broader and increasingly contentious conversations about the alliance’s expansion, Nikonov later told Defense One.

    That’s a startling admission when you think about it. It seems the Russian’s believe that if there is a war between Russia and the West, their conventional forces won’t be capable of defending Russian soil from NATO. They’re basically warning us that “if you bring a knife to this fight, we know we can’t win, so we’ll be bringing a gun.”

    And there’s a good reason for them to believe that NATO poses a dire threat to their territory and interests.

    “For us, [NATO] is a military alliance spanning three-quarters of the global defense money, now planning to expand that figure,” said Nikonov.

     

    In the two years since Russia annexed Crimea, NATO’s Baltic members have doubled their defense budgets. In 2018, Latvia, Lithuania, and Estonia are projected to spend nearly $670 million, up from $210 million in 2014. “This growth is faster than any other region globally,” Craig Caffrey, principal analyst at IHS Jane’s, remarked last October. “In 2005, the region’s total defence budget was $930 million. By 2020, the region’s defence budget will be $2.1 billion.”

     

    NATO has been expanding its troop presence in Eastern Europe as well. In April 2016, during the Warsaw summit, NATO agreed to increase the size of the NATO force deployed to Baltics, a posture move sometimes called enhanced forward presence. In January, the U.S. deployed some 4,000 troops to Poland. The following month, Germany, announced that it will send some 1,000 troops to  Lithuania.

    Since the end of the Cold War, NATO has slowly but surely encircled Russia. Just last month NATO admitted another Eastern European nation into their alliance, and the current antagonism between West and Russia is being driven by NATO’s attempts to absorb Ukraine.

    The West needs a reality check. The further we encroach into Russia’s traditional sphere of influence, the closer we come to World War Three. And if Russia really is such a serious threat to us, as our government has claimed many times in recent years, is expanding NATO really going to guarantee our safety?

    We were perfectly capable of protecting ourselves from the much more powerful Soviet Union, and we did so with a much smaller alliance. We’re expanding NATO to Russia’s doorstep, and all we’re receiving in return is the heightened risk of nuclear war.

  • Sorry Siri – You're The Dumbest "Smart" Assistant Out There

    Many industry experts predict that our interactions with computing devices will move away from text-based input towards voice-based input in the future. Smartphones, voice-enabled speakers and other devices already come with so-called smart assistants such as Siri, Cortana or Google Assistant. As Statista's Felix Richter notes, these virtual assistants can help you organize your day, control smart home devices and answer general questions. Or can they?

    According to research conducted by digital agency Stone Temple "smart assistants" may not be quite as smart as they are made out to be.

    Infographic: How Smart Are

    You will find more statistics at Statista

    Take Amazon's Alexa for example: the assistant powering the company’s popular line of voice-enabled speakers was able to answer just 20.7 percent of the 5,000 questions fired at it as part of the experiment. Notably, Google Assistant and Microsoft's Cortana were much more knowledgeable when it came to these factual questions while Apple's Siri performed similar to Alexa… but as the chart above shows, Siri was the worst-performer in terms of 100% correct responses.

  • Kristin Tate: Kathy Griffin Is Just The Tip Of The Liberal Violence Iceberg

    Authored by Kristin Tate, op-ed via TheHill.com,

    One of the pillars of democracy erodes before our eyes. The ability to disagree with the politically different disintegrates under red and black flags, and hooded rioters obscuring their faces. It’s not Donald Trump’s secret police. It’s not something out of a dystopian novel. It’s the very real culture of permissive violence exploding from today’s left. Bit by bit, this sort of behavior becomes quickly normalized (in the parlance du jour) and escalated.

    While there’s generally been blackout coverage of these “mostly peaceful” riots in the legacy media, every once in awhile something breaks through. Such is the case with the ever desperate Kathy Griffin’s latest sickening stunt. Griffin, who most people aren’t exactly sure why she is famous, posed for photos featuring the decapitated head of President Trump. Intended for an audience eager for more and more radical action, Griffin jumped over a big red line. Even CNN had to ask: did she commit a felony?

    Her too little, too late apology simply said she went “too far” rather than understanding the underlying crassness and danger her precedent sets. Griffin, who must appear on almost everyone’s “Top 10 Annoying Noncriminal People” (although the latter may change) list, traded vulgar coarseness for attention to a dying career. She said she asked the photographer to “take down the image” — as if that’s possible in the age of the internet. The only thing genuine in her drab statement was that it “wasn’t funny.” Understatement of the year.

    The real underlying question is why Griffin thought that such an odious action was acceptable in the first place. In the echo chamber of the modern left wing, it’s obvious. Where is the swift condemnation of the stunt by this “comedian?” Whataboutisms abounded, said one Twitter commentator with 217 followers — a random hillbilly once depicted a hanged President Obama!

    Some criticism came in from the left, including CNN’s Jake Tapper. He hosted a segment where — surprise, surprise, his panel said the network had better things to talk about than her. Considering the news network employs her for their New Year’s “I forgot to turn on Ryan Seacrest” snoozefest says enough.

    Will this incident live past this news cycle? Will there be solemn op-eds calling for “soul searching” among leaders of the Democratic Party for their tacit support of violent rhetoric and its predictable results? How many Seth Meyers and Stephen Colbert monologues will ridicule Griffin back into obscurity? Unfortunately, such questions are a waste of time. Even violence committed by that side of the aisle gets blamed on the White House.

    One of the rioters in Berkeley was finally arrested for assaulting a Trump supporter with a bike lock. Kellyanne Conway called on Democratic Party leaders to quell the rising violence among their supporters. Police again arrested violent protesters during the People’s Republic of Seattle’s May Day. Black clad antifa rioters assault and intimidate citizens and pro-Trump marchers.

    Meanwhile, if you turned on the mainstream media, you would think that President Trump was personally leading a campaign of violence from the left wing Oregon hipster district to the Montana congressional race.

    Take last week’s terrible attack on passengers in Portland. A mentally deranged man screamed at two Muslim women and slit the throats of their defenders. The media saw its narrative perfectly crafted. Except he was a Bernie supportingJill Stein voting, Trump hating maniac. The New York Daily News instantly declared Trump “ignored” the incident. The Huffington Post had to one up — or should I say 20-up them. Inverse said that Trump’s tweet condemning the attack didn’t even exist.

    wrote about the issue two months ago — and it only seems to be getting worse. This isn’t some sort of game. It’s people’s lives and livelihoods played with to reach the front of TMZ or the Huffington Post. Heck, the latter said that violence was “logical” and apologized to … you guessed it, liberals.

    It’s not funny. It’s not edgy. It’s just wrong.

    Where does the atmosphere of delegitimizing an elected government and brushing violence under the rug get you? Well, it gets you this…

  • China Manufacturing Contracts For The First Time In A Year: "The Economy Is Clearly On A Downward Trajectory"

    Following yesterday's official  (if less credible and focused mostly on SOEs) manufacturing and non-mfg PMI reports from China's National Bureau of Statistics, both of which came either in line or slightly better than expected, moments ago Caixin/Markit reported its own set of Chinese manufacturing data, and it was far more disappointing: at 49.6, not only did it miss expectations of 50.1, but by printing below 50, the operating conditions faced by Chinese goods producers deteriorated for the first time in nearly a year. As shown below, this was the first contractionary print sine last June when China's massive, anti-deflationary fiscal stimulus kicked in.

    The seasonally adjusted PMI posted below the neutral 50.0 value at 49.6 in May, the first contractionary print since the middle of 2016. Although only indicative of a marginal deterioration in operating conditions, Caixin conceded that the index fell from 50.3 to signal the first decline in the health of the sector for 11 months.

    The fall in the headline index coincided with slower increases in output and new orders, while staff numbers were cut at a quicker rate. Subdued demand conditions underpinned a renewed fall in purchasing activity, albeit only slight, and the first increase in inventories of finished items in 2017 so far. The latest data also signalled the first fall in input costs since last June, which in turn led manufacturers to lower their selling prices for the first time since February 2016.

    Commenting on the data, Dr. Zhengsheng Zhong, Director of Macroeconomic Analysis at CEBM Group said:

    “The Caixin China General Manufacturing PMI fell 0.7 points to 49.6 in May, marking its first contraction in 11 months. The subindices of output and new business stayed in expansionary territory, but both fell to their lowest levels since June last year. The subindices of input costs and output prices dropped into contractionary territory for the first time since June 2016 and February 2016 respectively. The sub-index of stocks of purchases signalled a renewed decline, while the sub-index of stocks of finished goods rebounded, indicating that companies have stopped actively restocking as inventories began to stack up. China’s manufacturing sector has come under greater pressure in May and the economy is clearly on a downward trajectory.”

    And while Chinese manufacturers reported a further rise in production during May, the pace of expansion was the weakest in the current 11-month sequence and only slight. Softer growth in output reflected a relatively muted increase in total new orders during May. Furthermore, growth in new order books was also the slowest seen since the current upturn began in July 2016. Data indicated that customer demand was relatively subdued both at home and overseas, with new export sales rising at a similarly marginal pace. Confidence towards the year-ahead meanwhile remained weaker than the historical average, with the degree of optimism unchanged from April’s four-month low.

    At the same time, employment continued on a downward trend, with the rate of job shedding picking up slightly for the third month running. Notably, it was the quickest decline in workforce numbers seen since last September. Lower staffing levels were partly linked to company down-sizing initiatives, but also the non-replacement of voluntary leavers. As a result, outstanding business increased again in May and at the fastest pace this year so far.

    Goods producers in China lowered their purchasing activity for the first time in 11 months in May, albeit only slightly. A number of panellists mentioned that weaker than expected sales had weighed on input buying. As a result, stocks of inputs declined and at the quickest pace since January. Subdued sales also contributed to a renewed increase in inventories of finished items.

    Although purchasing activity fell in May, average delivery times continued to lengthen. A number of panellists blamed longer lead times on stock shortages at vendors.

    Manufacturing companies reported the first decline in average cost burdens for nearly a year in May. The rate of reduction was marginal overall, and widely linked by respondents to lower raw material prices. Firms generally passed on any savings to clients, by cutting their output charges for the first time since February 2016.

    The FX market reacted swiftly with AUDUSD gains being erased…

    And Offshore Yuan erasing early losses and pushing to new highs…

    * * *

    None of this should come as a surprise: back in February we showed that, as a result of China's deleveraging measures, the global credit impulse had suddenly tumbled back to zero.

    And since that is a 3-4 month leading indicator, it was only a matter of time before China's economy reverted back into contraction, as the latest PMI data now confirms.

  • Why Carson Block Sees "Real Problems With Canada"

    Less than a week after declaring that China’s economy is headed for an economic “day of reckoning” thanks to its twin asset bubbles (real estate and equity), short-seller Carson Block said he’s starting to believe there are “real problems with Canada” – particularly the country’s dangerously overvalued housing market.

    Block discussed Canada's housing market with a Bloomberg reporter who called him for comment after shares of Element Fleet Management, a Toronto-based leasing company, plunged 38% on unfounded speculation that the famed short-seller had chosen the company as his next target. Shares of troubled home lender Home Capital Group also dipped in early trade.

    Block told Bloomberg that the action in those two stocks suggests Canadians are (rightfully) nervous about soaring real estate prices and household debt…

    “I’m starting to believe that there could be some real problems with Canada,”

    Though Block said he hadn’t heard of Element before Wednesday, the run on Home Capital Group’s deposits in recent weeks suggests that “investors denial is just starting to crack.” HCG is being drained of assets at an unprecedented pacealready 94% of retail deposits have fled the troubled lender – and the company has erased more than half of its market capitalization since a Canadian regulator accused it five weeks ago of misleading investors over an internal probe of fraudulent mortgage loan applications – a practice that bears some resemblance to US mortgage lenders’ reliance on “liar loans,” which helped inflate the subprime bubble.

     

    “Particularly given what happened to Home Capital in recent weeks I kind of wonder if Canadian investors are really nervous about the stuff that they’re holding and that’s why there was so much sensitivity around Element this morning," Block said.

     

    When I see a reaction like we saw to a stock that I had never heard of because people were evidently concerned that we were about to short it, that tells me that maybe we’re at a point in Canada where investor denial is just starting to crack,” he said.

    Block told Bloomberg that Canada’s real estate market has “been pushed by foreign money” to the kind of “buying frenzy” the U.S. experienced a decade ago.

    A frenzy of buying by wealthy Chinese nationals seeking to store their wealth outside of China has helped push Canadian home prices in certain markets to levels that are obviously unsustainable and well beyond the means of most Canadian citizens.

    Even Bank of Canada Governor Stephen Poloz acknowledged as much earlier this month when he remarked that Toronto home prices “were not sustainable” while answering questions following a speech in Mexico City.

    Block told Bloomberg about a visit to Toronto in 2011, when he said he was stunned to see posters throughout Toronto’s financial district encouraging people to borrow aggressively for consumption.

    “I was thinking, my God, didn’t we just go through this in the U.S.?”

    Meanwhile, there is a prevailing sense in Canada that the situation is different, and the collapse experienced by the U.S. in 2008 couldn’t happen here, he told Bloomberg.

    “Every time you hear that, you know that it can happen, and it’s going to.”

    Block concluded ominously…

    "The conditions seem to exist for there to be some pain inflicted on the markets. That suggests that Canada is the hottest market in the world for short sellers; if not, it could be."

    After a more than five-year break from shorting Canadian companies, Block announced Monday that he is shorting Asanko Mining Inc., saying that production problems at the company's largest mine will likely force the company into bankruptcy in 2018.

    True to form, Block explained his reasoning for shorting the stock in a 43-page research report published Wednesday, then summarized its contents during an appearance on Canada’s Business News Network. The notorious short seller believes the Vancouver-based mining company will run out of money in 2018 as it struggles to make urgent repairs at its main asset, the Ghana-based Nkran gold mine, while also serving its $165 million debt load.

    “We think Asanko is on its way to zero,” Block said during the interview.

     

     

  • Globalists Are Building An Army Of Millennials To Destroy Sovereignty

    Authored by Brandon Smith via Alt-Market.com,

    Back in October of 2016 I covered an issue which I have been very concerned with for over a year now. In an article titled Global Elites Are Getting Ready To Blame You For The Coming Financial Crash, I outlined the basis for my belief that Donald Trump would win the U.S. election and why the U.K. Brexit was allowed to meet with success. Here is a quote from that article to give you a general sense of my position:

    “I argue that the Trump tapes will be forgotten in a week and that they have no bearing whatsoever on the election. They are nothing more than bread and circus. Beyond the fact that really, almost no one cares what Trump said a decade ago. I argue that this election has already been decided. I argue that the globalists want Trump in office, just as they wanted the passage of the Brexit. I argue that they need conservative movements to feel as though we have won, so that they can pull the rug out from under us in the near future. I argue that we are being set up.

     

    Again, the elites are openly telling us what is about to happen. They are telling us that if ‘populists’ (conservatives) gain political power, the system will effectively collapse. To what extent is hard to say, but let’s assume that the situation will be ugly enough to influence the masses to reconsider the ideal of globalism as a possible solution. The elites are fond of the Hegelian dialectic and the philosophy of ‘order out of chaos,’ after all.”

    While Trump did indeed go on to “win” the presidency, I still believe that the basic foundation underlying my prediction has mostly fallen on deaf ears. There is a disconnect in terms of the globalist long game in people’s minds. I think it is because many in the public do not consider the effects of geopolitical events on mass psychology. Or, to be more precise, many people, even in the liberty movement, forget that the ultimate goal of the globalists is not just to corrupt governments and monetary systems, but to corrupt our collective mindset.

    As a perfect example, I will link to the latest globalist lunacy from the Pope, Jorge Bergoglio, in which he attacks libertarianism (true conservatism) as a dangerous form of individualism that threatens the fabric of the new and more progressive collectivist world.

    In terms of Western culture, recent events would indicate that globalists hope to enlist the newest generation to reach “maturity” (and I use that term loosely), the millennials, as a weapon to deal the death blow to conservatism. If not directly, then indirectly through propagation.  That is to say, if the globalists can’t kill us off immediately, they will try to breed us and our ideas out after bringing down the hammer of economic and social crisis.

    When I discuss what essentially amounts to a “war on conservatism,” what do I mean? Well, first let’s consider what it is about conservatives that presents a threat to the globalists…

    Limited Government

    The basic core of conservative thought rests on the concept of limited or small Constitutional government. If you don’t believe in small government, you are not a conservative. Big (and centralized) government is the most vital tool in the hands of globalists. Without it, they would not be able to accomplish a single item on their agenda.

    Big government requires big money. Thus, the central banking syndicate becomes “necessary” to the life of the nation or society because they have positioned themselves to provide the financing and fiat that greases the big government wheels. In a limited government system, central banking becomes irrelevant. It is therefore essential that globalist financiers diminish or destroy conservative principles of limited government because they represent a primal threat to the interdependent behemoth system they hope to create.

    Sound Money

    True conservatives are sound money champions. This principle fell by the wayside for many decades but has made a resurgence since 2008 as more people have been awakened to the failings of central banking and fiat money. Sound money is basically money backed by a tangible commodity, money that cannot be created out of thin air. If it can be created out of thin air, it is not sound money.

    Obviously, the very existence of a true sound money movement horrifies the globalists. Without fiat printing or digital currency systems (which can be created and re-created ad infinitum), the future of a global currency system, the pinnacle goal of the globalist economic scheme, is all but impossible.

    Free Thought And Free Expression

    If you are in the business of controlling the thoughts and opinions of other people, then you are not a conservative. This is where we find distinct misconceptions, by liberals most of all, as far as what free expression is.

    For conservatives, this means that if you are in a publicly funded space or on private property with permission of the owners, you should have the right to say whatever you like whenever you like (this includes so-called "hate speech", millennials and liberals). You should be able to make grievances known and to discuss those grievances in a constructive manner. It does not matter if your thoughts are offensive to some people; their feelings are meaningless compared to your freedom to speak in that space.

    Leftists seem to think that freedom of expression means being allowed to invade the sanctity of other people’s private property or invade a public gathering with the intention of disrupting the free speech of others that they disagree with. My favorite argument presented by leftists is their argument that liberty proponents cannot kick them out of events or off of websites because “that would be a violation of our own principles and their free speech.” They don’t seem to understand the different between private and public or destructive and constructive. My other favorite argument leftists often use is their argument that it is an act of free speech when they disrupt other people’s free speech.

    Hopefully you can see the difference between the two ideals. Leftists today seek to control speech and expression they see as “aberrant” or “evil.” Conservatives defend everyone’s right to speak as long as they respect the nature of the property they are standing on and do not abuse the owners of that property — this includes taxpayers, the owners of public property.

    Freedom Of Association

    This is a very simple and straightforward liberty that has all but been crushed in our country today. Conservatives have this crazy idea that you should not be forced by government to associate with people you do not want to associate with. It does not matter why you don’t want to associate with them. The “why” has no bearing whatsoever. We feel that logic should dictate the situation. If you don’t want to associate with someone, why would they want to associate with you?

    But, for some reason, certain people within our culture and within government believe that denying anyone association is discrimination, and, in a progressive and interdependent society, discrimination is unacceptable. I happen to think the ability to discriminate on an individual level is necessary to a healthy society. Discrimination only becomes dangerous when it is backed by government power.

    The Right To Self Defense

    Many people are so disconnected from their own survival that the notion of “self defense” is alien and terrifying to them. They pay taxes so that “professionals” can handle their security for them, after all. Why should they need the means to secure themselves and their loved ones?

    Well, what if the professionals you pay taxes for suddenly turn on you? Or what if they simply quit en masse one day? What if your attacker is 60 seconds from harming you and the closest law enforcement officer is six minutes away? In a conservative society, EVERYONE acts as security for themselves and others if needed.

    Globalists need to encourage a culture in which the population is always reliant on government for everything, including their own safety. The most effective form of control comes not through force, but through permission. The most successful tyranny is the one that the people demand rather than the one people barely tolerate.

    Sovereignty

    All of these principles coalesce into the root principle of sovereignty — the inborn right to self determination. This might take the form of individual action or voluntary group action based on the freedom of association. A single person might seek to live on his own away from others in his own way, and he absolutely has the right to do this even if it annoys people for whatever crazy reason. A large group of people also have the right to cooperate, to build a system or even a nation based on a particular set of shared values and to have their borders respected or avoided by those with different values.

    Conservatism, at least in its traditional form, is the vanguard of sovereignty. Without conservatives, sovereignty dies.

    *  *  *

    Now that we have briefly summarized the conservative archetype, consider for a moment the predominantly progressive millennial generation; what values do they hold? This is not to say that all millennials think the same way, but what about the majority? In 10 years, what would a country like the U.S. look like when they move into power?

    The statistics indicate that the U.S. would be even more socialist than it is today, bordering on communist. A paradise for pushing forward the globalist agenda.

    When you take into account the fact that Bernie Sanders, a staunch socialist with Marxist tendencies, garnered more support from young voters during the last election than both Clinton and Trump combined, you can see the problem here. Sanders enjoyed nearly 80 percent of the millenial vote in many states, and this tends to correlate with what we have seen in other western nations such as the U.K., where over 70 percent of the young vote was AGAINST the Brexit campaign to leave the globalist EU project.

    Also take into account the establishment push to instill millennial academia with open borders propaganda.  In this article for the Washington Post, the president of George Mason University in Northern Virginia argues that open borders are the source of "innovation" and a better economy.  Open borders philosophy cannot coexist with sovereignty.  Sovereignty being a foundation for individualism and nationalism; open borders being a foundation for forced collectivism and a one world system.  For open border ideology to continue forward, all sovereignty must be eliminated.

    Here we find the socialist entrenchment within the younger population. To question its validity among them is simply not done. Through most of Europe, for example, to even describe one’s self as “conservative” is considered highly taboo. Many sovereignty activists there will instead list themselves as “classical liberal” (conservatives).

    In the U.S., the last true bastion of hardcore conservatives, there is a little more hope as Generation Z teens are showing signs of a conservative resurgence and a little more sense than their older millennial brothers and sisters. This is why I believe the globalists are focusing on the millennial subset; the millennials experienced the American world when they were children at its height pre-2008 and conjured grand dreams of career, success and technological ease. After the crash and subsequent end of college degree relevancy, they now feel jilted and put upon. Clearly “free markets” are the culprit and revolution is the answer.

    Generation Z is growing up in the new and downtrodden economic landscape. They are accepting that harder work is necessary and that more freedom is paramount instead of demanding that entitlements be given to them. So, it would appear that the the globalists have a small window of time to stage a coup against conservative philosophy, install a new millennial generation as the captains of the ship and discourage Generation Z from continuing on the path towards what they consider a "terrible and ignorant" world view.

    If you think that perhaps I am exaggerating the gravity of the situation, or that I am applying too much conspiracy to an otherwise random social development, I would like to cite Facebook mogul and globalist cabana boy Mark Zuckerberg, who in a recent speech to Harvard graduates asked them to “fight isolationism and nationalism” which he equated with “authoritarianism” and to support “openness and global community.”

    “This is the struggle of our time. This is not a battle of nations, it is a battle of ideas,” Zuckerberg stated.

    Zuckerberg’s rant is just the most recent example of this propaganda in action. As I have been warning, the globalist strategy is to destroy opposing ideas, not just opposing groups. And clearly, they want to exploit the millennials to do just that.

  • Tucker Carlson Discusses Hillary Clinton's Recent Russian Conspiracy Theories

     

    Content originally published at iBankCoin.com

     

    Ever since the election, the democrats and establishment republicans have been ‘investigating’ Russian ties to Trump and how that all led to John Podesta’s email box to be hacked into, which of course led to Hillary Clinton losing the Presidential election. She lost, not because of her criminality, but because of fake news, obviously. It’s worth noting, in a year of arduous investigations, nothing has been proven to tie Trump to the Russians.

    Yesterday, Hillary discussed the election, positing questions to the panel regarding RUSSIAN COLLUSION with Trump. She said Trump directed the release of the Podesta emails down to the second, coordinated and directed the fake news media to concoct salacious stories, fueled by the emails, colluding with Russian intelligence to steal the election from her.

    In case you’re just tuning in, you did not reject the DNC establishment candidate and vote for populism because you were sick and tired of the same old corrupt DC bullshit. No, you voted for Trump because of the Russians, the ultimate King makers, coerced into the decision via a series of psyops programs, coordinated with Trump, to brainwash people into believing she was not a trustworthy candidate.

    Holy shit Hillary has lost her mind. Tucker’s take.

    Here are some of her sweeter moments in the interview, accusing the idiot Giant Orange President of being a criminal mastermind — directing endless schemes and plots to seize the Presidency from her claws.
     

    “It’s important that Americans…understand that Putin wants to bring us down. He was an old KGB agent.”
     
    “We saw evidence of [Russian involvement] and we could track it. But they were shooed away.”
     
    “The Russians are increasingly..launching cyber attacks. A lot of the information they’ve stolen they use for internal purposes. So this was different because they went public.”
     
    “That was the conclusion. I think it’s fair to ask how did that actually influence the campaign and how did they know what messages to deliver. Who told them? Who were they coordinating with or colluding
    with? I’m leaning Trump.”
     
    “Within one hour of the Access Hollywood tapes being leaked, the Russians or say Wikileaks — same thing — dumped the John Podesta emails.”
     
    “The Russians in my opinion could not have known how best to weaponize that information unless they had been guided by Americans.”
     
    “My email account was turned into the biggest scandal since Lord knows when. And, you know, in the book I’m just using everything that anybody else said about it besides me to basically say this was the biggest nothing-burger ever. It was a mistake. I’ve said it was a mistake, and obviously if I could turn the clock back I wouldn’t have done it in the first place. But the way that it was used was very damaging.”
     
    “We know it hurt us, as I explain in my book, the Comey letter which was now we know partly based on a false memo from the Russians. It was a classic piece of Russian disinformation. So for whatever reason, he dumps that on me on October 28 and I immediately start falling.”
     
    “Well if you went all the way back, doing things that others have done before was no longer acceptable. I didn’t break any rule nobody said don’t do this. I was very responsible and not at all careless. You end up with a situation that was exploited.”
     
    “Here’s a really telling statistic that has been validated. I had this old fashioned idea that it would matter what I would do as president. We had a great tech program and a really good set of policies. In 2008 which as the last time you had a contested election, the policies put forth by President Obama, Senator McCain got 222 minutes of airtime. In 2016 despite my best efforts, we got 32 minutes, total, over 18 months.”
     
    “Media forces on the Republican side are entrenched and very effective. They’re beginning to call the shots on those local stations. Local TV is still incredibly powerful.”
     
    “I have been on many speaking platforms with many men who are in office or running for office. And the crowd gets you going and I watch my male counterparts and they beat the podium and they yell and the crowd loves it. I have tried that and it’s been less than successful.”

     
    Regarding her Goldman Sachs speeches.
     

    “Men got paid for the speeches they made…I got paid for the speeches I made.”
     
    “I have to say, Walt I never thought someone would throw out my entire career…because I made a couple of speeches.”

    There you have it. The emails were giant ‘nothing-burgers’ that were attained by an evil genius, criminal, mastermind, named Donald Trump, with the help of the inherently evil Vlad Putin (how many Americans has Russia killed lately?). She lost thanks to a vast right wing conspiracy of media shills at the NY Times and other publications who wanted to see Trump elected.
     
    What.the.fuck?

    Notable: Trump is back to ‘Crooked Hillary’ again.

    //platform.twitter.com/widgets.js

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Today’s News 31st May 2017

  • NATO Recoils From Trump Spending Salvos

    Authored by Finian Cunningham via The Strategic Culture Foundation,

    When US President Donald Trump addressed the opening of the NATO summit last week, it was an embarrassing display of American bullying. As Trump lectured the other leaders of the military alliance about laggardly financial commitments, there was much shuffling of feet and grimacing of faces. There were also contemptuous smirks as the president spoke.

    Speaking outside the new North Atlantic Treaty Organization headquarters in Brussels, Trump declared that many members «owed» the US a lot of money for their defense. He said it was unfair to American taxpayers that only five out of 28 current NATO members meet an agreed target of allocating 2 per cent of GDP to military spending.

    At a photo-op line-up, Trump was seen to push Montenegrin Prime Minister Dusco Markovic out of the way in order to get himself into a prime front row position. The fleeting moment spoke volumes of the American view of fellow NATO members.

    It was Trump’s first meeting of the US-led military alliance since his inauguration four months ago. During his presidential campaign, Trump derided the organization as «obsolete». After becoming president, he kind of retracted that complaint to civilian titular head Jens Stoltenberg at a meeting in Washington, when Trump performed a typical U-turn and said he no longer considered NATO obsolete.

    Other senior Trump administration officials have sought to repair the damage to relations by making earnest statements on American commitment to NATO. Vice President Mike Pence and Secretary of Defense General James Mattis have described the alliance as a bedrock of American policy.

    Trump’s debut in Brussels last week, however, has renewed the strains within NATO. His incessant demand for other members to cough up is aggravating relations – particularly between the US and Germany. His address in Brussels sounded boorish and ill-informed. Trump’s omission to pledge American commitment to «shared defense» under NATO’s Article 5 – as all US presidents customarily do – was also seen as another sign of Trump playing hardball.

    Nick Burns, a former US ambassador to NATO under George W Bush, told American news channel CNN that he was «stunned» by Trump’s speech.

    «This is the first president since 1949 not to mention Article 5. Every president has reaffirmed collective defense and today was the day for him to do it», said Burns, adding: «I support him on asking allies to spend more on defense. But there is a time and a place. And this wasn’t it. The lecture was the wrong tone and this was the wrong time».

    Trump has previously hinted that the US would not automatically come to the defense of other NATO members because of their relatively low financial contributions. That he again pointedly omitted mention of Article 5 in Brussels will unnerve some NATO members, particularly the Baltic states and Poland, who claim they are threatened by Russia, despite Moscow’s repeated assurances that it has no aggressive designs on Europe.

    Also of note, Trump cited terrorism as the main threat facing NATO. He did mention Russia as a security challenge in a perfunctory sort of way, but it was noticeable that the American president did not appear to view Moscow as an existential threat. That will further unnerve «Russophobes» within NATO.

    The frosty meeting in Brussels was in stark contrast to Trump’s glad-handing with Saudi and other Arab leaders days before. He kicked off his inaugural official foreign trip by first of all visiting Saudi Arabia during which Trump signed a $110 billion arms deal (part of a larger $350 billion sale over 10 years.)

    The same ballpark figure cropped up again later during Trump’s tetchy speech to NATO members. He said that if all members who do not currently meet their 2 per cent of GDP spending commitment were to do so then that would generate $119 billion in military allocation per year. Much of that extra cash would go directly into the US economy in the form of new orders for F-16 and F-35 fighter jets, Abrams tanks, Patriot anti-missile systems and other Pentagon-contracted hardware.

    It seems clear that the main purpose of Trump’s meet-and-greet the world tour was to drum up as much business as possible for US military industry. No wonder he was effusive in his praise for Saudi and Arab leaders when they were writing such mega checks for American weapons. Not so in Europe, where Trump evidently feels most of the NATO members are cheating the US out of tens of billions of dollars every year from their allegedly feckless commitment to defense.

    Has Trump got a point though? That is, are the European members of NATO are freeloaders on American chivalry? It’s not just Trump who thinks that way. His predecessor Barack Obama also griped about «freeloaders» not pulling their weight. There is a general American conception that its military presence in Europe and elsewhere around the world is a chivalrous act of protection, which countries should pay more for. Trump just happens to articulate this view in an unvarnished, gruff manner.

    NATO’s 2 per cent of GDP target is an arbitrary guideline. It is not binding. Each member spends on a separate national basis. There is no collective fund and there are no debts to others from those members who do not spend 2 per cent of GDP on military.

    It is true that the US is way and above the highest NATO military spender, allocating around 3.6 per cent of GDP annually – well over $600 billion. That represents over 70 per cent of the entire NATO budget.

    This compares with relatively low-spending Germany on 1.2 per cent of GDP, Italy on 1.1 per cent and the Netherlands on 1.2 per cent. Ironically, Belgium, which hosts the NATO headquarters, spends less than 1.0 per cent of GDP on military. These countries argue that they allocate a lot more than the US to overseas development aid in Africa and the Middle East, thereby addressing security concerns in a broader, civilian way other than narrow military terms.

    Only five members of NATO meet the arbitrary 2 per cent target: US, Britain, Greece, Poland and Estonia.

    But the gargantuan US spend is more a reflection of its economy being heavily dependent on a military-industrial complex, than on any supposed noble commitment to defending allies.

    Trump’s tour of the Middle East and Europe – while billed by the White House as a peace-building itinerary – was all too evidently really about pushing America’s military industry and global exports of US weaponry.

    By doing so, Trump is recklessly adding fuel to an already explosive Middle East. And on relations with Europe, the US president is acutely straining relations with his petulant, unfounded demands that they pay up more for NATO, and in effect subsidize the American economy.

    This will lead to further deterioration in relations between Washington and its European allies, especially Germany. Trump has castigated Germany as being not only a laggard in defense spending (a freeloader) but also exploiting the US consumer market with trade surpluses.

    Trump’s abrasive attitude to other NATO members last week brings out the real nature of the US relationship. The so-called alliance is really just a spending vehicle for the American economy. In these austere global times, such American bullying will only chafe on the Europeans. This will in turn reinforce calls already underway for an independent EU defense pact, separate from NATO, and possibly led by Germany and France.

  • A Voice Of Reason Speaks Regarding "The New Cold War"

    Authored by Mike Krieger via Liberty Blitzkrieg blog,

    Last week was interesting for me. I spent about half my time getting up to speed with the latest happenings in the crypto-coin world, and got really excited about a lot of what I saw. In fact, this was the first time I became totally consumed by the space in several years, going back to when I first investigated and started becoming involved with Bitcoin.

    What really caught my attention is the booming ICO market, and while it’ll invariably produce its fair share of total scams, I find it nonetheless captivating. I’m attracted to its dynamic wild west spirit, as well as its capacity to function as an alternative funding mechanism for startup projects utilizing a wider participatory structure consisting of anyone with a bit of crypto currency and a high-risk tolerance. It’s an entirely new experimental ecosystem funded by crypto currencies (mostly ethereum, but also bitcoin). It’s pretty mesmerizing (for more see: A New Financial System is Being Born).

    Spending so much time on this esoteric world kept me away from following U.S. politics as closely as I typically do, which was a great thing.

    The level of discourse from nearly all sides of the political spectrum has turned so toxic, divisive, hysterical and counterproductive, leaving that environment for several days made me feel great, as if I had taken a vacation from idiot island. As such, today I once again decided to spend some time reading up on the crypto-coin space and getting further up to speed on ICOs and how they work. That said, I realize I still need to pay attention to the crazy happenings in the wider world around me, so I thought I’d share an interview with a rarity in today’s political discourse, a voice of reason.

    What follows are excerpts from a Slate  interview with Stephen F. Cohen, professor emeritus of Russian studies and politics at NYU and Princeton:

    Stephen F. Cohen has long been one of the leading scholars of Russia and the Soviet Union. He wrote a biography of the Bolshevik revolutionary Nikolai Bukharin and is a contributing editor at the Nation, which his wife, Katrina vanden Heuvel, edits and publishes. In recent years, Cohen has emerged as a more ideologically dexterous figure, ripping those he thinks are pursuing a “new Cold War” with Russia and calling for President Donald Trump and Russian President Vladimir Putin to form “an alliance against international terrorism.” Cohen has gone so far as to describe the investigations into the Trump campaign and Russia “the No. 1 threat to the United States today.”

    Cohen has been criticized by many people, myself included, for his defenses of Putin. (He once said the Ukraine crisis had been “imposed on [Putin] and he had no choice but to react.”) He scolded President Barack Obama for sending retired gay athletes to Sochi and recently went on Fox News to speak up for Trump’s war against leakers.

    I spoke by phone with Cohen, who is also a professor emeritus of Russian studies and politics at NYU and Princeton and the author of Soviet Fates and Lost Alternatives: From Stalinism to the New Cold War. During the course of our conversation, which has been edited and condensed for clarity, we discussed why Cohen won’t concede that the Democratic National Committee was hacked, whether it’s fair to call Putin a murderer, and why we may be entering an era much more dangerous than the Cold War.

     

    I heard you recently on Fox News. You said that the “assault” on President Trump “was the No. 1 threat to the United States today.” What did you mean by that?

     

    Threat. OK. Threat. That’s a good word. We’re in a moment when we need an American president and a Kremlin leader to act at the highest level of statesmanship. Whether they meet in summit or not is not of great importance, but we need intense negotiations to tamp down this new Cold War, particularly in Syria, but not only. Trump is being crippled by these charges, for which I can find no facts whatsoever.

     

    Wait, which charges are we talking about?

     

    That he is somehow in the thrall or complicity or control, under the influence of the Kremlin.

     

    I think it would help if he would admit what his own intelligence agencies are telling him, that Russia played some role in …

     

    No, I don’t accept that. I don’t accept that at all, not for one minute.

     

    People in the Trump administration admit this too.

     

    Well they’re not the brightest lights.

     

    And the president is?

     

    No. You didn’t ask me that. You asked me, you said, some of the president’s people. You’re referring to that intel report of January, correct? The one that was produced that said Putin directed the attack on the DNC?

     

    I was referring to that and many news accounts that Russia was behind the hacking, yes.

     

    The news accounts are of no value to us. I mean you and I both know …

     

    No value? None?

     

    No. No value. Not on face value. Just because the New York Times says that I don’t know, Carter Page or [Paul] Manafort or [Michael] Flynn did something wrong, I don’t accept that. I need to see the evidence.

     

    OK, let’s just go back to what you were saying about Trump being hamstrung.

     

    You need Trump because he’s in the White House. I didn’t put him there. I didn’t vote for him. Putin’s in the Kremlin. I didn’t put him in the Kremlin either, but we have what we have, and these guys must have a serious dialog about tamping down these cold wars, which means cooperating on various fronts. The obvious one—and they already are secretly, but it’s getting torpedoed—is Syria.

     

    So we come now with this so-called Russiagate. You know what that means. It’s our shorthand, right? And Trump, even if he was the most wonderfully qualified president, he is utterly crippled in his ability to do diplomacy with the Kremlin. So let me give you the counterfactual example.

     

    Imagine that Kennedy had been accused of somehow being, they used to accuse him of being an agent of the Vatican, but let’s say he had been accused widely of being an agent of the Kremlin. The only way he could have ended the Cuban Missile Crisis would have been to prove his loyalty by going to nuclear war with Russia. That’s the situation we’re in today. I mean Trump is not free to take wise advice and use whatever smarts he has to negotiate down this new and dangerous Cold War, so this assault on Trump, for which as yet there are zero facts, has become a grave threat to American national security. That’s what I meant. That’s what I believe.

     

    To use your Kennedy example, there was no evidence that Kennedy was an agent of either the Vatican or the Kremlin—

     

    No, but Isaac you’re not old enough to remember, but during the campaign, because he was the first Catholic, they all went on about he’s an agent of the Vatican.

     

    I know that. I’m old enough to have read “news accounts” of it. Anyway, there was a hacking of the DNC and—

     

    Wait actually no, Isaac stop. Stop. Now, I mean we don’t know that for a fact.

     

    That there was a hacking of the DNC?

     

    Yeah we do not know that for a fact.

     

    What do we think happened?

     

    Well …

     

    So you’re really going to argue with me that the DNC wasn’t hacked?

     

    I’m saying I don’t know that to be the case.

    OK.

     

    I will refer you to an alternative report and you can decide yourself.

     

    Can we agree on this much at least: that Trump said there was a hack, refused to say who he thought did it, encouraged the hackers to keep doing it, at the same time that he was getting intelligence reports that it was the Russians, and that he continued to talk very positively about Putin after he was told this?

     

    You’ve given me too many facts to process, but if Trump said he knew it was a hack, he was not fully informed. We just don’t know it for a fact, Isaac.

     

    So we don’t have any forensic evidence that there was a hack. There might have been. If there was a hack, we have no evidence it was the Russians, and we have an alternative explanation that it was actually a leak, that somebody inside did a Snowden, just stuck a thumb drive in and walked out with this stuff. We don’t know. And when you don’t know, you don’t go to war.

     

    Let’s turn to Putin and America. Why do you think we have entered a new Cold War?

     

    My view is that this Cold War is even more dangerous. As we talk today, and this was not the case in the preceding Cold War, there are three new fronts that are fraught with hot war. You know them as well as I do. The NATO military build-up is going on in the Baltic regions, particularly in the three small Baltic countries, Poland, and if we include missile defense, Romania. That’s right on Russia’s border, and in Ukraine. You know that story. That’s a proxy civil war right on Russia’s border, and then of course in Syria, where American and Russian aircraft and Syrian aircraft are flying over the same airspace.

     

    And there is the utter demonization of Putin in this country. It is just beyond anything that the American political elite ever said about Khrushchev, Brezhnev, and the rest. If you demonize the other side, it makes negotiating harder.

    In 2017, being a voice of reason has become a revolutionary act.

  • Emerging Markets Are Not All Created Equal

    For most investors, targeting foreign countries where there are high expectations for growth is a useful strategy.

    After all, in the United States, Canada, and Europe, economies are mostly growing at about 2% or less per year. And while these developed markets are less risky to invest in, finding value can be tricky.

    That’s why, as VisualCapitalist's Jeff Desjardoins notes, for many decades, investors have been allured by the fast growth of far-off economies. In the 1950s and 1960s, Japan’s economy regularly expanded at a 10%+ clip, and who can forget the “Four Asian Tigers” that followed in Japan’s footsteps? In the 2000s, the focus shifted to the BRICS (Brazil, Russia, India, China, South Africa) – and more recently, attention has been on countries like Indonesia, Nigeria, Colombia, and Turkey.

    DIFFERENT RISKS IN EMERGING MARKETS

    Although emerging markets are similar in that they have high expectations for growth, it’s important to remember that these countries have very unique and different sets of risks.

    Today’s visualization comes to us from Charles Schwab, and it provides a simple breakdown of the types of risks faced by the economies of emerging markets:

    Courtesy of: Visual Capitalist

    As an example, Mexico and Chile have considerably different risks, according to the chart.

    Aside from currency risk, which they both share, Chile is particularly prone to sensitivity in the world’s commodity markets. That makes sense, because Chile is the world’s largest supplier of copper – and close to 50% of the country’s exports are copper-related, including refined copper (22.6%), copper ore (20.9%), raw copper (3.6%), and copper wire (0.5%).

    On the other hand, Mexico is noted as having particular sensitivity to what happens in developed markets such as the United States. This is because 81% of Mexican exports go to the U.S., while the next biggest buyer of Mexican goods is Canada at 3% of exports. If the buying power of the U.S. and Canada is affected, it could have big consequences on what will be bought from Mexico.

  • CNN Host Fareed Zakaria Destroys 'Tolerant' Liberals: "Freedom Of Speech Is Not Just For Your Warm Fuzzy Ideas"

    Authored by Mac Slavo via SHTFplan.com,

    The alternative media has, for good reason, slammed CNN time and again for fabricated news stories, untruths and left-leaning propaganda.

    But the following opinion report from CNN’s Fareed Zakaria is a must-watch, as it touches on the very core of the purported tolerance among liberals.

    As progressive Evergreen State College professor recently stated in an interview after demands by social justice warriors that he be fired for racism, “I am troubled by what this implies about the current state of the left.

    While America’s White Left believes their policies of socialism, cultural assimilation and outright disdain for anything other than their own righteous ideologies are the only way forward, Zakaria succinctly explains that it goes against the whole idea of what Liberalism is supposed to be.

    American universities these days seem committed to every kind of diversity except for intellectual diversity… Conservative voices and views, already a besieged minority, are being silenced entirely… The campus thought police have gone after serious conservative thinkers like Heather McDonald and Charles Murray, as well as firebrands like Milo Yiannopoulos and Ann Coulter…

     

    Some were dis-invited… others booed interrupted and intimidated…

     

    It’s strange that this is happening on college campuses that promise to give their undergraduates a liberal education… the word ‘liberal’ in this context has nothing to do with today’s partisan language… but refers instead to the Latin root ‘pertaining to liberty’

     

    And at the heart of the liberal tradition in the Western world has been freedom of speech… from the beginning people understood that this meant protecting and listening to speech with which you disagreed.

     

     

    Freedom of speech and thought is not just for just warm fuzzy ideas that we find comfortable… it’s for ideas that we find offensive.

     

     

    There is also an anti-intellectualism on the left… an attitude of self righteousness that says we are so pure, so morally superior, we cannot bear to hear an idea with which we disagree.

     

    Liberals think they are tolerant, but often they aren’t.

     

    //platform.twitter.com/widgets.js

    The left is so intolerant of other ideologies that it is only a matter of time before their refusal to accept differences among cultures, races and creeds fractures their entire chaotic movement.

    We are literally at a point where wearing red, white and blue is considered blatant racism in some circles.

    Soon, like rabid animals, their intolerance will be the very catalyst that drives them to turn on each other.

  • Steve Cohen Hoping To Raise $20 Billion For Re-Launch Of SAC Capital

    Steven Cohen is hoping to raise $20 billion for a new fund he plans to launch soon after his ban on managing outside money expires in January 2018, the Wall Street Journal reports.

    If Cohen is successful, it would be the largest hedge-fund launch on record. The sum would exceed the $16 billion his former firm, SAC Capital, managed at its peak – before the Securities and Exchange Commission forced him to shut it down and accept a four-year ban from the industry. Though, as WSJ notes, most – if not all – of Cohen’s $11 billion family fortune would likely be rolled into his new fund.

    Raising such a sum would be “a show of resilience for the Wall Street veteran after years of legal fights,” The WSJ said. Government investigators eventually convicted eight of his former employees of securities fraud, but Cohen himself escaped prosecution.

    But even if Cohen succeeds in meeting his target raise, it’s difficult to imagine how he’ll replicate his past market-beating performance without relying on some of the same tactics that initially attracted the Feds’ attention.

    If his family office's recent returns are any indication, his fund might not be able to manage anything more than treading water.

    As WSJ reports: Mr. Cohen, 60, has been overseeing his $11 billion family fortune at Point72 Asset Management LP, a 1,000-employee operation in SAC’s former Stamford, Conn., offices where Mr. Cohen’s desk sits at the center of the trading floor. While Point72 has made money since becoming a family office, last year its overall investment performance was roughly flat, Mr. Cohen’s second-worst ever annual showing, people familiar with the matter said.

    To that end, Cohen is planning something that would've been "unthinkable" at SAC: He's considering lowering his fees, which once totaled as much as 3% of assets and half of all profits. Cohen's success would be notable not just for him, but for the industry as a whole, which suffered tens of billions in outflows last year.

    Last year, hedge fund investors pulled more than $70 billion, the industry’s highest annual outflow since the crisis.

    Cohen's quest for outside capital has already lead him back to the high-society circuit.

    As WSj reports, he appeared at a gala to benefit Lincoln Center in January. And during a visit to SALT last month, Cohen “hosted a private dinner for staff and industry executives and attended closed-door events with speakers and sponsors including onetime rivals like hedge-fund manager Daniel Loeb, people familiar with the matter said."

  • Amazon is Now Worth More Than Every Store in the Mall Combined

     

    Content originally published at iBankCoin.com

     

    Everyone knew Amazon was crushing retail, dating back at least a decade. But for some reason, very few went through with the easiest pair trade of all time — long AMZN, short shopping mall operators. What a simple, yet brilliant, trade. Is it not?

    Here’s an old market cap chart of when Amazon topped Walmart. Now it’s worth two Walmarts.

    Here’s another old chart that captures the spirit of Amazon’s sales explosion. The current annual run rate is in excess of $140b.

    So how does Amazon’s $143b in annual revenues stack up against other retailers?

    According to Exodus, there are 31 companies in the Apparel Stores industry, the names you’re all familiar with when shopping at the old dead mall, whose sales equal $107b combined, with net income of $13.6b. Their composite market caps are $81.69b, the inversion of the price/sales ratio is indicative of an industry in duress.

    Amazon’s $143b in annual sales and net income of just $9b is rewarded with a market capitalization of $469b.

    Think about that for a moment. The entire shopping mall, sporting +1.1% quarterly revenue growth, does more net income than Amazon, on 40% less in revenues, and yet Amazon is valued at 5x what the entire mall is being sold for on the market today.

    The Department Stores are an even worse comparison. TJX, M, KSS, SHLD, DDS, JCP, SRSC, SHOS and BONT combined do revenues of $129b, netting $10.17b in income, yet the composite market caps are just $68b on -4.5% quarterly revenue growth.

    I get Amazon is the future and they’re growing at 22% per annum. But is it worth more than all the department stores and apparel stores combined 3x over?

    And now for the most egregious juxtaposition: Amazon vs the Discount/Variety Store industry.

    The Discount Variety stores include WMT, TGT, COST, DG, DLTR, BURL, PSMT, BIG, FRED and TUES. An impressive set of retailers, no doubt. Together, they sport sales of $729b with net income of $51b, enjoying median quarterly revenues growth of nearly 5%.

    Their market caps combined equal $389b. If you threw in another COST, you might get to match Amazon’s market cap.

    Does any of this shit make sense to you?

  • Which Companies Have The Highest Revenue Per Employee?

    Authored by Ilya Levtov via Priceonomics.com,

    For many companies, the biggest cost is talent. This is especially true of Silicon Valley, where companies sell clicks and digital goods that do not have any material cost. So which companies' workforces are able to generate the most revenue?

    We decided to analyze every company in the Standard & Poor's 500 Index to see which ones had the highest and lowest revenues per employee. The  Standard & Poor's 500 Index (S&P 500”) includes the 500 largest American companies listed on the NYSE or NASDAQ. In 2016, S&P 500 companies generated $11 trillion in combined revenue and employed more than 25 million people worldwide.

    We found that Energy companies have the highest average Revenue per Employee, while Industrials and Consumer Discretionaries perform worst on this metric.

    Technology companies performed at the lower end of the range on Revenue per Employee; part of the reason for this however, is other companies in spaces like Energy and Healthcare have large non-employee costs that Technology companies do not have.

    ***

    The table below shows the top 50 companies by Revenue Per Employee in 2016 in S&P 500.

    Data source: Craft

    AmerisourceBergen, a pharmaceutical distributor, tops the list, generating more than $7.9M per employee in 2016. With a reported team of 19,000, which is less than half the workforce of Cardinal Health (37,300) and McKesson (68,000), the company compares favorably to its peers on revenue per employee. Cardinal Health and McKesson's RPE were $3.3M and $2.8M, respectively. Overall, Healthcare companies score well on revenue per employee, though they have other huge costs (the costs of administering drugs and health services).

    Energy companies Valero Energy Corporation and Phillips 66 take positions 2 and 3, with $7.6M and $5.7M in Revenue per Employee. With the exception of tobacco manufacturers (Altria Group and Reynolds American) and insurance providers (Aflac and XL Group), the top ranks are dominated by Energy and Healthcare sectors. 23 of the top 50 are Energy companies and one-fifth are Healthcare organizations. Like Healthcare companies, Energy companies also have large non-employee costs, however (the costs of the natural resources, for example) 

    Grouping the companies into sectors in the chart below, we see the relative labour-intensity of different industries.

    Data source: Craft

    Average revenue per employee in the Energy sector is double that of Healthcare companies and almost four times as high as that of Information Technology companies.

    The table below shows the lowest 10 companies in the index ranked by RPE.

    Data source: Craft

    It is perhaps unsurprising that Restaurant and Hotel chains make up the majority of the list. What is more striking is that IT providers Cognizant and Accenture have among the lowest revenue per employee in the Index.Amphenol Corporation, a manufacturer of interconnect products, recorded $101K Revenue per Employee, less productive than its competitor TE Connectivity, which generated $163K per Employee.

    ***

    Next, we calculated the change in Revenue per Employee from 2014-16 to see if any trends emerged. The graph below shows S&P 500 companies with the highest and lowest growth rate in RPE.

    Data source: Craft

    Most of the RPE growth leaders made headcount reductions last year and thus saw their sales per headcount increase. The healthcare companies in this list with an exception for Vertex Pharmaceuticals experienced both revenue growth and headcount reduction, leading to sharp growth in RPE.

    8 out of 10 companies with the lowest RPE growth experienced a drop in revenues in the period, while remaining Ball Corporation and Global Payments shrank in RPE mainly due to extensive recruiting.

     ***

    We then looked specifically at Technology companies. Only Netflix (which is classed as Consumer Discretionary in the S&P500, not Technology), Apple and Facebook appeared among the top 50 companies by RPE, which required RPE of at least $1.3M.

    The following table shows the top 20 Technology companies by revenue, ranked by RPE.

    Data source: Craft

    Apple has the highest revenue per employee in this selection of technology companies. However, they have substantial non-employee costs since selling hardware involves buying materials and making something tangible. Facebook and Alphabet (Google), on the other hand, make most of their revenue from selling a virtual good (advertising) and still have a tremendously high revenue per employee. VeriSign, which provides domain names and internet security, was a strong performer, generating $1.1Bn in revenue from only 990 employees, ranking fourth in the Technology sector, with $1.2M per employee.

    *** 

    Overall, Energy companies led the pack in Revenue per Employee, followed by Healthcare and Utilities. Technology companies showed themselves to be labour-intensive with RPE at the lower end of the range, and close to Consumer Discretionaries like restaurants and hotels. To see the full list of companies comprising S&P 500 Index, please click here.

  • "I'm Sorry, I Went Too Far" – Kathy Griffin Apologizes For Video Of Beheaded Trump

    Having been destroyed by the left (Chelsea Clinton: "vile and wrong"), the right (Trump Jr.: "Disgusting but not surprising"), and everyone in between ("you're a terrorist and an enemy of the state. She needs to be treated as such.") it seems 'comic' Kathy Griffin (most famous for presenting the New Year's Eve countdown) has decided to apologize for her video where she is seen holding the head of the president, which is slathered in fake blood.

    And the response was not what she hoped for… (via DailyMail)

    Ironically, it was a former first daughter that was quick to fire back at griffin, with Chelsea Clinton writing: 'This is vile and wrong. It is never funny to joke about killing a president.'

     

    'This is discusting [sic] Kathy Griffin has never been funny,' said self-styled conservative paralegal NativeCA. 'This should be reported to the FBI & Twitter.'

     

    Meanwhile, @nancygolliday said 'Parading beheading of POTUS makes @kathygriffing a terrorist and an enemy of the state. She needs to be treated as such.'

     

    And Dr J wrote: 'You're disgusting. Honor our military but dishonor our President and Commander in Chief? You'd behead our President? Hypocrite.'

    Even some self-described liberals got in on the act…

    'Big time Liberal here – and a Kathy Griffin fan – and I agree,' said Tanya Crosse. 'This is not ok and there is no excuse. She should immediately apologize.'

     

    Meanwhile, Simar wrote: 'We can't knock the alt right for promoting hate speech & then support Kathy Griffin for promoting violence against the President.' 

    But then it got serious…

    //platform.twitter.com/widgets.js

    //platform.twitter.com/widgets.js

    Which prompted a desperate career-saving PR rescue… "I'm sorry, I went too far, I was wrong"

    //platform.twitter.com/widgets.js

    We leave it to Donald Trump Jr. who summed up the hypocritical reality of America today so perfectly

    And if anyone on 'the left', who has proclaimed with violence how 'hate speech' is not 'free speech', tries to defend this, it merely highlights just how low they will stoop into the hell of self-delusion to avoid facing the reality that Trump "is your president" whether you like it or not.

  • Putin: "Russian Meddling Is A Fiction Democrats Invented To Divert Blame For Their Defeat"

    With McCarthyism 2.0 continues to run amok in the US, spread like a virulent plague by unnamed, unknown, even fabricated sources, over in France one day after his first meeting with French president Emanuel Macron, the man who supposedly colluded with and was Trump’s pre-election puppet master (but had to wait until after the election to set up back-channels with Jared Kushner) Vladimir Putin sat down for an interview with French newspaper Le Figaro in which the Russian president expressed the belief that Moscow and Western capitals “all want security, peace, safety and cooperation.”

    “Therefore, we should not build up tensions or invent fictional threats from Russia, some hybrid warfare etc.,” the Russian leader told his French hosts. “What is the major security problem today? Terrorism. There are bombings in Europe, in Paris, in Russia, in Belgium. There is a war in the Middle East. This is the main concern. But no, let us keep speculating on the threat from Russia.”

    Case in point, in the latest attempt to stir up an anti-Russian frenzy, America’s biggest neocon, John McCain said that Russia is even more dangerous than ISIS. “You made these things up yourselves and now scare yourselves with them and even use them to plan your prospective policies. These policies have no prospects. The only possible future is in cooperation in all areas, including security issues.”

    “Hacking” Clinton And the DNC

    Even with the FBI special investigation on “Russian collusion” with the Trump campaign and administration taking place in the background, Putin once again dismissed allegations of Russian meddling in last year’s U.S. presidential election as “fiction” invented by Democrats to divert the blame for their defeat. Putin repeated his strong denial of Russia’s involvement in the hacking of Democratic National Committee emails that yielded disclosures that proved embarrassing for Hillary Clinton’s campaign. Instead, he countered that claims of Russian interference were driven by the “desire of those who lost the U.S. elections to improve their standing.”

    “They want to explain to themselves and prove to others that they had nothing to do with it, their policy was right, they have done everything well, but someone from the outside cheated them,” he continued. “It’s not so. They simply lost, and they must acknowledge it.” That has proven easier said than done, because half a year after the election, Hillary Clinton still blames Wikileaks and James Comey for her loss. Ironically, what Putin said next, namely that the “people who lost the vote hate to acknowledge that they indeed lost because the person who won was closer to the people and had a better understanding of what people wanted,” is precisely what even Joe Biden has admitted several weeks ago, and once again yesterday. Maybe Uncle Joe is a Russian secret agent too…

    In reflecting on the ongoing scandal, which has seen constant, daily accusations of collusion and interference if no evidence (yet), Putin conceded that the damage has already been done and Russia’s hopes for a new detente under Trump have been shattered by congressional and FBI investigations of the Trump campaign’s ties to Russia. In the interview, Putin also said the accusations of meddling leveled at Russia have destabilized international affairs

    Going back to the hotly debated topic of “influencing” the election, Putin once again made a dangerous dose of sense when he argued that trying to influence the U.S. vote would make no sense for Moscow as a U.S. president can’t unilaterally shape policies. “Russia has never engaged in that, we don’t need it and it makes no sense to do it,” he said. “Presidents come and go, but policies don’t change. You know why? Because the power of bureaucracy is very strong.” Especially when the bureaucracy in question is the so-called “deep state.”

    Asked who could have been behind the hacking of the Democrats’ emails, The Russian leader added that he agreed with Trump that it could have been anyone. “Maybe someone lying in his bed invented something or maybe someone deliberately inserted a USB with a Russian citizen’s signature or anything else,” Putin said. “Anything can be done in this virtual world.” This echoed a remark by Trump during a September presidential debate in which he said of the DNC hacks: “It could be Russia, but it could be China, could also be lots of other people. It could be someone sitting on their bed that weighs 400 pounds.”

    Assad, Red-Lines and Chemical Weapons

    Putin was asked about French President Emmanuel Macron’s warning that any use of chemical weapons in Syria was a “red line” that would be met by reprisals, to which the Russian president said he agreed with that position. But he also reiterated Russia’s view that Syrian President Bashar Assad’s forces weren’t responsible for a fatal chemical attack in Syria in April. Putin said Russia had offered the U.S. and its allies the chance to inspect the Syrian base for traces of the chemical agent. He added that their refusal reflected a desire to justify military action against Assad. “There is no proof of Assad using chemical weapons,” Putin insisted in the interview. “We firmly believe that that this is a provocation. President Assad did not use chemical weapons.”

    “Moreover, I believe that this issue should be addressed on a broader scale. President Macron shares this view. No matter who uses chemical weapons against people and organizations, the international community must formulate a common policy and find a solution that would make the use of such weapons impossible for anyone,” the Russian leader said.

    On NATO’s Military Buildup across Russian borders

    Weighing on the outcome of the recent NATO summit, at which Russia was branded a threat to security, Putin pointed to the ambiguous signals Moscow is receiving from the alliance. “What attracted my attention is that the NATO leaders spoke at their summit about a desire to improve relations with Russia. Then why are they increasing their military spending? Whom are they planning to fight against?” Putin said, adding that Russia nevertheless “feels confident” in its own defenses. Washington’s appeal to other NATO members to ramp up their military spending and alleviate the financial burden the US is forced to shoulder is “understandable” and “pragmatic,” Putin said.

    But the strategy employed by the alliance against Russia is “shortsighted,” the Russian president added, referring to the NATO’s expanding missile defense infrastructure on Russia’s doorstep and calling it “an extremely dangerous development for international security.” Putin lamented that an idea of a comprehensive security system envisioned in the 1990s that would span Europe, Russia and US has never become a reality, arguing that it would have spared Russia many challenges to its security stemming from NATO. “Perhaps all this would not have happened. But it did, and we cannot rewind history, it is not a movie.”

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Today’s News 30th May 2017

  • We Know What Inspired The Manchester Attack, We Just Won't Admit It

    Authored by Patrick Cockburn via The Strategic Culture Foundation,

    In the wake of the massacre in Manchester, people rightly warn against blaming the entire Muslim community in Britain and the world. Certainly one of the aims of those who carry out such atrocities is to provoke the communal punishment of all Muslims, thereby alienating a portion of them who will then become open to recruitment by Isis and al-Qaeda clones.

    This approach of not blaming Muslims in general but targeting “radicalisation” or simply “evil” may appear sensible and moderate, but in practice it makes the motivation of the killers in Manchester or the Bataclan theatre in Paris in 2015 appear vaguer and less identifiable than it really is. Such generalities have the unfortunate effect of preventing people pointing an accusing finger at the variant of Islam which certainly is responsible for preparing the soil for the beliefs and actions likely to have inspired the suicide bomber Salman Abedi.

    The ultimate inspiration for such people is Wahhabism, the puritanical, fanatical and regressive type of Islam dominant in Saudi Arabia, whose ideology is close to that of al-Qaeda and Isis. This is an exclusive creed, intolerant of all who disagree with it such as secular liberals, members of other Muslim communities such as the Shia or women resisting their chattel-like status.

    What has been termed Salafi jihadism, the core beliefs of Isis and al-Qaeda, developed out of Wahhabism, and has carried out its prejudices to what it sees as a logical and violent conclusion. Shia and Yazidis were not just heretics in the eyes of this movement, which was a sort of Islamic Khmer Rouge, but sub-humans who should be massacred or enslaved. Any woman who transgressed against repressive social mores should be savagely punished. Faith should be demonstrated by a public death of the believer, slaughtering the unbelievers, be they the 86 Shia children being evacuated by bus from their homes in Syria on 15 April or the butchery of young fans at a pop concert in Manchester on Monday night.

    The real causes of “radicalisation” have long been known, but the government, the media and others seldom if ever refer to it because they do not want to offend the Saudis or be accused of anti-Islamic bias. It is much easier to say, piously but quite inaccurately, that Isis and al-Qaeda and their murderous foot soldiers “have nothing to do with Islam”. This has been the track record of US and UK governments since 9/11. They will look in any direction except Saudi Arabia when seeking the causes of terrorism. President Trump has been justly denounced and derided in the US for last Sunday accusing Iran and, in effect, the Shia community of responsibility for the wave of terrorism that has engulfed the region when it ultimately emanates from one small but immensely influential Sunni sect. One of the great cultural changes in the world over the last 50 years is the way in which Wahhabism, once an isolated splinter group, has become an increasingly dominant influence over mainstream Sunni Islam, thanks to Saudi financial support.

    A further sign of the Salafi-jihadi impact is the choice of targets: the attacks on the Bataclan theatre in Paris in 2015, a gay night club in Florida in 2016 and the Manchester Arena this week have one thing in common. They were all frequented by young people enjoying entertainment and a lifestyle which made them an Isis or al-Qaeda target. But these are also events where the mixing of men and women or the very presence of gay people is denounced by puritan Wahhabis and Salafi jihadis alike. They both live in a cultural environment in which the demonisation of such people and activities is the norm, though their response may differ.

    The culpability of Western governments for terrorist attacks on their own citizens is glaring but is seldom even referred to. Leaders want to have a political and commercial alliance with Saudi Arabia and the Gulf oil states. They have never held them to account for supporting a repressive and sectarian ideology which is likely to have inspired Salman Abedi. Details of his motivation may be lacking, but the target of his attack and the method of his death is classic al-Qaeda and Isis in its mode of operating.

    The reason these two demonic organisations were able to survive and expand despite the billions – perhaps trillions – of dollars spent on “the war on terror” after 9/11 is that those responsible for stopping them deliberately missed the target and have gone on doing so. After 9/11, President Bush portrayed Iraq not Saudi Arabia as the enemy; in a re-run of history President Trump is ludicrously accusing Iran of being the source of most terrorism in the Middle East. This is the real 9/11 conspiracy, beloved of crackpots worldwide, but there is nothing secret about the deliberate blindness of British and American governments to the source of the beliefs that has inspired the massacres of which Manchester is only the latest – and certainly not the last – horrible example.

     

  • Millions Of Americans Just Got An Artificial Boost To Their Credit Score

    Back in August 2014, we first reported that in what appeared a suspicious attempt to boost the pool of eligible, credit-worthy mortgage and auto recipients, Fair Isaac, the company behind the crucial FICO score that determines every consumer’s credit rating, “will stop including in its FICO credit-score calculations any record of a consumer failing to pay a bill if the bill has been paid or settled with a collection agency. The San Jose, Calif., company also will give less weight to unpaid medical bills that are with a collection agency.” In doing so, the company would “make it easier for tens of millions of Americans to get loans.”

    Then, back in March of this year, in the latest push to artificially boost FICO scores, the WSJ reported that “many tax liens and civil judgments soon will be removed from people’s credit reports, the latest in a series of moves to omit negative information from these financial scorecards. The development could help boost credit scores for millions of consumers, but could pose risks for lenders” as FICO scores remain the only widely accepted method of quantifying any individual American’s credit risk, and determine how much consumers can borrow for a new house or car as well as determine their credit-card spending limit

    Stated simply, the definition of the all important FICO score, the most important number at the base of every mortgage application, was set for a series of “adjustments” which would push it higher for millions of Americans.

     

     

    The outcome of these changes was clear for the 12 million people impacted: it “will make many people who have these types of credit-report blemishes look more creditworthy.

    Now, as the Wall Street Journal points out today, efforts to rig the FICO scoring process seems to be bearing some fruit.  The average credit score nationwide hit 700 in April, according to new data from Fair Isaac Corp., which is the highest since at least 2005.

    Meanwhile, the share of consumers deemed to be riskiest, with a score below 600, hit a new low of roughly 40 million, or 20% of U.S. adults who have FICO scores, according to Fair Isaac. That is down from 20.5% in October and a peak of 25.5% in 2010.

    FICO

     

    Of course, to be fair, we are also reaching that critical 7-year point where the previous wave of mortgage foreclosures start to magically disappear from the FICO scores of millions of Americans. 

    Mortgage foreclosures stay on credit reports for up to seven years dating back to the missed payment that resulted in the foreclosure. Foreclosure starts, the first stage in the process, peaked in 2009 at 2.1 million, according to Attom Data Solutions. They totaled nearly 1.8 million in 2010 and remained above one million during each of the next two years.

     

    Personal bankruptcies are more complicated and can stay on credit reports for seven to 10 years.

     

    Consumers who filed in 2007 for Chapter 7 protection—the most common type of bankruptcy, in which certain debts are discharged and creditors can get paid back from sales of consumers’ assets—are now starting to see those events fall off their reports. Some 500,000 Chapter 7 bankruptcy cases were filed in 2007, a figure that swelled to nearly 1.1 million in 2010, according to the Administrative Office of the U.S. Courts.

     

    Chapter
    13 bankruptcies, in which consumers enter a payment plan with creditors, usually stay on reports for at least seven years. Those filings reached a recent peak of nearly 435,000 in 2010 and are set to start falling off reports this year.

    FICO

     

    All of which, as the WSJ points out, will help to “boost originations of large-dollar loans for cars and homes.”  Which is precisely what the average, massively-overlevered American household needs…more debt.

    Fresh starts for credit reports are likely to help boost originations of large-dollar loans for cars and homes. Consumers have a greater chance of getting approved for financing if they apply for loans after negative events fall off their reports, in particular from large banks that have stuck to strict underwriting criteria, says Morgan Whitacre, who oversees consumer-loan underwriting at Bank of America Corp.

     

    Credit-card lending, already on the rise, could increase further as a result of fresh starts. Consumers who have one type of bankruptcy filing removed from their credit report experience a roughly $1,500 increase in spending limits and rack up $800 more in credit-card debt within three years, according to the Federal Reserve Bank of New York.

    So maybe that auto lending bubble has a little room left to run afterall…

  • In Memoriam, 2017

    Authored by Robert Gore via StraightLineLogic.com,

    You don’t fight for your country, you fight for your government.

    The Golden Pinnacle, by Robert Gore

    On Memorial Day, America remembers and honors those who died while serving in the military. It is altogether fitting and proper to ask: for what did they die? Do the rationales offered by the military and government officials who decide when and how the US will go to war, and embraced by the public, particularly those who lose loved ones, stand up to scrutiny and analysis? Some will recoil, claiming it inappropriate on a day devoted to honoring the dead. However, it is because war is a matter of life and death, for members of the military and, inevitably, civilians, that its putative justifications be subject to the strictest tests of truth and the most probing of analyses.

    Millions have marched off to war believing they were defending the US, which implies the US was under attack. Yet, setting aside for a moment Pearl Harbor and 9/11, US territory hasn’t been invaded by a foreign power since the Mexican-American War (arguably—Mexico claimed the territory it “invaded” was part of Mexico), or, if the Confederacy is considered a foreign power, the Civil War. That war ended a century-and-a-half ago, yet every US military involvement since has been justified as a defense of the US. That has gradually attenuated, in a little noted slide, to a defense of US “interests,” which is something far different.

    Only one of those involvements could, arguably, have been said to have forestalled not an invasion, but a possible threat of invasion: World War II. Watching newsreel graphics of Germany’s drives across Europe, Northern Africa, and the USSR, and Japan’s across Asia and the Pacific, it was perhaps understandable that Americans believed the Axis powers would eventually come for them, especially after Pearl Harbor. However, that was a one-off attack by the Japanese to disable the US’s Pacific Fleet. To launch an invasion of the US, Japan, a smaller, less populated nation whose economy depended on imports of vital raw materials, including oil, would have had to cross the Pacific and fight the US, and undoubtedly Canada, on their home territories. The Pearl Harbor attack, provoking America’s entry into the war, proved a strategic blunder for the Japanese. An invasion would have been ludicrous. Similarly, Germany, up to its eyeballs in a two-front war, couldn’t conquer Russian winters or Great Britain across the English Channel. How was it supposed to either cross the Atlantic, or the USSR and hostile guerrillas, then the Pacific, and attack the US? That, too, would have been ludicrous.

    The 9/11 attack was also a one-off. A majority of the attackers came not from a US enemy but rather a supposed ally, Saudi Arabia. They received funding and other support from people in that country and perhaps its government. A conventional war against a “state sponsor of terrorism” might have required war against Saudi Arabia; it is still not clear how involved its government was. That option was never considered. Rather, the Bush administration performed metaphysical gymnastics and launched the first war in history against a tactic: terrorism. Although the jihadists who perpetrated 9/11 were self-evidently not the vanguard of an invasion, the terrorism they employed was deemed a threat to US interests in the Middle East, and to life and property in the US. However, none of our subsequent involvements in Afghanistan, Iraq, Syria, Libya, Egypt, and Yemen have been necessary to maintain US citizens’ freedoms, the nation’s territorial integrity, or its lives and property.

    There are undoubtedly many epitaphs on tombstones in this country to the effect: Here lies the deceased, who died defending America, and not one that reads: Here lies the deceased, who died defending American interests. However, the latter is in most cases more accurate than the former. Who decides the interests for which members of America’s military will die? Those considering entering the military today must look beyond the slogans, contemplate the risks of being killed, wounded, dismembered, paralyzed, or psychologically traumatized, and ask themselves: why and for whom are these risks being borne? “You don’t fight for your country, you fight for your government.” Is it worth risking one’s life for the US government?

    In 1821, John Quincy Adams said America had not gone “abroad in search of monsters to destroy,” and while we wished those seeking liberty well, theirs was not our fight (see “In Search of Monsters,” SLL, 4/11/15). Since then, America has searched for monsters, found, and in some cases, destroyed them. However, as the poison of power has worked its evil on the minds and souls of those who possess it, the monsters have become more ethereal, apparitions conjured like creatures in the closet by children when they go to bed. The war on terrorism creates more terrorists, the monsters of choice since 9/11. The government still pays occasional lip service to “democratic values” and “civil liberties,” but allies itself with regimes which have no more fealty to those values and liberties than the “tyrants” the government opposes. “Defending America” and “Promoting Our Way of Life” have become transparent pretexts for American power and domination unbounded. As Adams so presciently warned, the search for monsters has turned the government itself into a monster, the biggest threat to Americans’ “inextinguishable rights of human nature.”

    Those who have fought and died to defend America and its freedoms are noble beyond measure. Those who pay self-serving tribute to their valor, but make war and expend lives as means to corrupt ends are evil beyond redemption. Honor the former; expose and oppose the latter.

  • Biden Bashes "Distracted" Democrats For Ignoring Working-Class Concerns

    After declaring to a bunch of SALT Conference attendees last month that Hillary “was never a great candidate,” former Vice President Joe Biden criticized the Democratic Party's campaign strategy for winning over working class voters, saying that too many were distracted by the Trump campaign's negativity, the Hill reported.

     

    “Because of the negative campaign that [President Donald] Trump ran, how much did we hear about that guy making 50,000 bucks on an assembly line, [and] the woman — his wife — making $28,000 as a hostess?" Biden asked.

     

    "They have $78,000, two kids, [are] living in a metropolitan area, and they can hardly make it," Biden added. "When was the last time you heard us talk about those people?"

    Biden, who was stumping for New Jersey gubernatorial candidate and former Goldman Sachs executive Phil Murphy, sounded like his old campaign-trail self, stoking speculation of another run in 2020.

    When asked at SALT if he would run again for the presidency, Biden said “I may very well do it,” but added that he couldn’t commit to another run right then.

    As The Hill reports, some Democrats see Biden as the best candidate to try and win back some of the working class white voters lost to Trump. Biden maintains that he hasn’t ruled out another run for the presidency.

  • "The Technology Is Getting Real" – Laser Weapons Edge Closer To Battlefield Use

    Three months after China unveiled "Silent Hunter" – its vehicle-slicing laser weapon, Stars & Stripes reports that US military forces are testing their own array of hi-tech weaponry.

     

     The Silent Hunter laser is powerful enough to cut through light vehicle armor at up to a kilometer away, making you wonder if China already has more powerful laser weapons only for domestic use.

    And now Military.com reports, the toy-like drones destroyed during an Army field exercise at Fort Sill, Okla., last month weren't anything special; however, the way they were brought down — zapped out of the sky by lasers mounted on a Stryker armored vehicle — might grab people's attention.

    The first soldier to try out the lasers was Spc. Brandon Sallaway, a forward observer with the 4th Infantry Division. He used a Mobile Expeditionary High Energy Laser to shoot down an 18-by-10-inch drone at 650 yards, an Army statement said.

    "It's nothing too complicated but you have to learn how to operate each system and get used to the controls which is exactly like a video game controller," said Sallaway, who hadn't fired a laser before the exercise.

    The drone-killing laser was relatively low energy — only 5 kilowatts — but the Army has tested much more powerful weapons. A 30-kilowatt truck-mounted High Energy Laser Mobile Demonstrator shot down dozens of mortar rounds and several drones in November 2013 at White Sands Missile Range, N.M.

    Lockheed Martin's 30-kilowatt Accelerated Laser Demonstration Initiative, known as ALADIN.

    Since then, researchers have made rapid advances in laser weapons, said Bob Ruszkowski, who works on air dominance projects and unmanned systems in Lockheed's secretive Skunk Works facility.

    "We're really on the cusp of seeing the introduction of lasers in future systems," he said.

    The weapon tested at White Sands is about to double in power with a 60-kilowatt laser the Army plans to test in the next 18 months, he said in a phone interview May 12.

    The laser generates its beam through fiber optic cables like those used by telecom companies, said Robert Afzal, a senior fellow for laser and sensor systems at Lockheed.

    "We demonstrated that we could combine large number of these fiber lasers and link them to a weapons system," he said.

    Lasers are very efficient at converting electrical power to a laser beam, Afzal said.

    That's important for the platforms that carry them, he said. It means they don't need a large generator or cooling system and that high-powered lasers can be easily transported.

    "This was the key puzzle piece that needed to be solved before we could begin to deploy these laser weapons," Afzal said. "The technology is getting real. It's the dawn of a new era where the tech can be made smaller and powerful enough to be put on vehicles, ships and aircraft."

    Scientists showed the potential of more powerful laser weapons in 2015 by burning a hole through a truck's hood at a range of one mile.

    "It was the most efficient high-powered laser ever demonstrated," Afazal said of the test, which mimicked what might happen if a laser was fired at a vehicle from an aircraft.

    During an operation, a laser might be used to disable a vehicle where the goal was to capture rather than kill an individual, Ruszkowski said.

    "The laser is a surgical weapon and it's something customers are interested in," Afazal said. "Something like that can be easily integrated into an AC-130 gunship. That is something the Air Force is planning on demonstrating in the next two to three years."

    Researchers believe they have the key ingredients to make such a system work, Ruszkowski said.

    "When we realized that laser technology was maturing enough that we could be close to having something we could integrate on an aircraft we started looking at other difficulties that might arise," he said.

    Airflow around a plane can destabilize lasers, so engineers developed a way to minimize turbulence, said Ruszkowski, who added that the Navy has deployed a laser weapon on board the USS Ponce in the Persian Gulf.

    Laser weapons could be arriving just in time to defeat a growing menagerie of cheap-to-make drones and missiles in the hands of terrorists and rogue states, which could threaten expensive American military hardware.

    "The threats are proliferating and changing," but laser weapons could counter some of them, Afazal said.

    An advantage of laser weapons is that they don't need ammunition, he said. For example, a forward-operating base could protect itself from airborne threats with a laser as long as there was enough fuel to power a generator and recharge its batteries.

    Use of such weapons on enemy troops is a gray area that, for now, the U.S. military is steering clear of since international agreements ban the use of weapons intended to blind, Afazal said.

    "Before lasers have been deployed and we understand how they work, the policy is conservative," he said.

     

  • Hong Kong's Housing Market Has Become "A Sea Of Madness" Central Bank Warns

    What a difference 16 months makes.

    It was in February of 2016 when, looking at the latest trends in the Hong Kong housing market, we wrote that in January [2016] Hong Kong home prices tumbled the most since July 2013, and after a 12 year upcycle, prices were now down 10% from the recent peak just four months prior…

    … while the local Centaline Property Agency estimated that total Hong Kong property transactions at the start of 2016 were on track to register the worst month on record.

    Fast forward to today when that particular blip is long forgotten, swept away by the record credit injection unleashed by China in the interim, which has spilled over into the Hong Kong’s housing market where instead of concerns about a bubble bursting, the locals are preoccupied with chasing the latest, and biggest yet, housing bubble to form in Hong Kong, as crowds of people line up in hope of being the winning bidder for one of several properties for sales, some of which are oversubscribed as much as 15x.

    //platform.twitter.com/widgets.js

    According to the latest data from Hong Kong’s Centaline Property Centa-City Leading Index of existing homes, prices have risen an unprecedented 23% in the past year, setting new price records week after week. Over the past decade, home prices in the financial capital of Asia have tripled.

    As Bloomberg observes, snaking queues of thousands of prospective apartment buyers in Hong Kong signaled authorities have made no progress in cooling a red-hot property market, where prices are at records.

    //platform.twitter.com/widgets.js

    At the Victoria Skye, a luxury project at the former airport site of Kai Tak and at the Ocean Pride development by Cheung Kong Property Holdings people were lining up on Friday and over the weekend for their chance to buy a home at all time high prices.

    K&K Property has offered an additional 200 units at Victoria Skye after it sold 306 flats on Saturday, Ming Pao newspaper reported. Cheung Kong will put another 346 up for grabs after selling 496 in a single day, May 26, it said. In both cases, the developers will raise the prices of the additional units by about 2 percent, the newspaper reported.

    Yes, HK real estate prices are rising by 2% not over a year, or a month, but in one day!

    That, however, does not stop the relentless demand from local buyers. Hong Kong developers sold 8,616 homes in the first five months of the year, more than were sold in any first half since new purchasing rules were introduced in 2013, the Hong Kong Economic Times reported.

    What makes this particular bubble different is that this time, it is obvious to everyone, certainly the local press. An editorial in The Standard newspaper on Monday was surprisingly accurate: “successive moves by the government in recent memory to cool the property market only resulted in it becoming crazier. The result is a sea of madness.

    It is also obvious to the local central bank, which, however, like Vancouver and Toronto, appears powerless to halt the tsunami of hot mainland money. The Hong Kong Monetary Authority has been tightening rules for lenders, Bloomberg writes, including restricting levels of lending to developers, as it tries to limit financial risks and take some of the heat out of the market. 

    And yet, so far the result is absolutely nothing as nobody bothers to listen to the growing warnings. 

    Speaking at a Legislative Council meeting last Monday, Hong Kong’s central bank chief, HKMA Chief Executive Norman Chan, said levels of demand were reminiscent of 20 years ago, just before Hong Kong suffered a property bust, and he expressed concern that people with limited financial resources were buying just because they thought prices would only keep going up, just like in a bubble.

    Chan said that while the global economy has improved, uncertainties remain and warned that when the property cycle reverses, “the impact will be serious.”

    With real estate prices rising fast – in some cases as much as 2% per day – his warning has fallen on deaf ears. Of course, it will be different when the bubble against bursts, and everyone is “shocked” that the authorities let it come to this again, and then first the HKMA, then the PBOC, will have to again step in and bail out all the bubble chasing speculators once more, or risk yet another economic collapse, rinse and repeat.

  • Euro Slides After Greece Hints At Default

    EURUSD is sliding in early Asian trading after Greece’s government is reportedly planning to forego its next bailout payment (of around EUR7bn) if no debt relief is offered by creditors (thus leaving it likely to default on its next round of repayments).

    Bloomberg reports, Greece’s government preparing to possibly go without next bailout payment if creditors don’t agree on debt relief for the country according to German newspaper Bild (without saying where it obtained the information).

    While probably just another negotiating step, it is weighing on EURUSD.

  • Inside The Republicans' 'Black-And-Blue' Bill

    Authored by Eric Peters via EricPetersAutos.com,

    Naturally, the solution to the problem of police abusing their authority is to hold them less accountable when they do exactly that.

    Leave it to “law and order” Republicans such as Texas Sen. John Cornyn and Rep. Ted Poe to evolve such logic. They have put forth the Black and Blue – whoops, Back the Blue – act (see here) which would make it harder to sue run-amok law enforcers in civil court to recover damages resulting from actions undeniably illegal – while at the same time imposing more severe penalties on Mundanes who affront the holy person of a law enforcer than those imposed on Mundanes who do exactly the same thing.

    As regards the first:

    So long as the victim – er, perp – was “engaged in felonies or crimes of violence” (how this it to be determined in the heat of the moment remains unclear) the law enforcer administering the wood shampoo or “directory assistance” (beating administered with a phone book in between the flesh and he nightstick, to keep the bruising down) or some other such informal technique, will be immunized from subsequent civil suit by his victim, provided the abuse suffered occurred while the enforcer was acting in a “judicial capacity.”

    Breathtaking.

    It is obvious – or should be – that this only encourage more lawless “street justice” by the enforcers of the law. It will also encourage more generous application of the law – i.e., of bogus/trumped-up charges (such as felony “resisting”) in the immediate aftermath of an otherwise legally unjustifiable beatdown, to immunize the beaters from the legal consequences of said beatdown.

    This GOP act of cop suckage is even better than a throw-away stiletto  – which dirty cops used to keep on hand to leave adjacent to the bloodied corpse of their victim, so as to justify his aeration.

    That was at least illegal.

    Now, they won’t have to bother.

     

    What these Republican brownshirts – and that term isn’t too strong; if anything, it is too soft – propose to do is legalize objectively criminal conduct, the conduct to be justified by eructing that the victim was a “law breaker” and so – presumably – deserved to have more than the legally prescribed justice meted out to him and – critically – before he has been duly convicted of anything at all.

    Under the proposed Black and Blue lawlessness, law enforcement is to be given discretion to administer street justice, according to its lights – and the victim of this is to be rendered legally helpless. No damages are to be awarded for any violations of law that occurred during “any action brought against a judicial officer for an act or omission taken in the judicial capacity of that officer.”

    Hut!Hut! Hut! You will respect my authoritah!

     

    At the same time, any assault upon the person of a law enforcer by a Mundane becomes a separate federal crime with a mandatory two-to-five-year stint in federal prison. Twenty if the accused was in possession of a weapon during the incident.

    The legal definition of “assault” can be a trivial as jabbing a finger onto someone else’s chest. Or – in the case of law enforcement – defending oneself against an assault by a law enforcer. Attempt to ward off a wood shampoo –  a reflex action that is almost impossible to suppress, and – to well-practiced cries of “stop resisting!” – you have just purchased a two-to-five-year ticket to the federal prison of their choice.

    It goes without saying that a law enforcer who commits exactly the same offense – assuming he is even charged – will suffer nothing of the sort.

    Cannot suffer anything of the sort, because the the law specifies more lenient treatment for assault-by-cop upon a Mundane.

    And the lights just got a little dimmer.

    One hates to trot out the Nazis, but they seem never to go away. They merely change uniforms. In the Third Reich, to strike an officer of the Reich was an enormous crime, far worse – and treated far more severely – than the treatment meted out to officers of the Reich who abused citizens of the Reich. For which acts, the officers of the Reich were usually rewarded.

    As is often the case, the words of the brutal but never truckling Reichsmarschall Herman Goring are worth recalling.

    But first, it is worth recalling that Goring was Nazi Germany’s chief law enforcer for a time. Head of the Prussian State Police, creator of the first German concentration camps and founder of the Gestapo, the acronym standing for geheim staats polizei, or secret state police. He was hanged – well, supposed to have been hanged – after the judgment at Nuremburg precisely for his activities as Nazi Germany’s Top Cop.

    And here is what Goring had to say about his law enforcers, when the question of excesses arose:

    “Shoot first and inquire afterwards; if you make mistakes, I will protect you. Every bullet which leaves the barrel of a police pistol is my bullet. If one calls this murder, then I have murdered. I ordered all this. I back it up. I assume the responsibility and I am not afraid to do so.”

    One can imagine Cornyn or similar “law and order” Republican – including the current orange-tinctured buffoon – saying pretty much the same.

    What the hell happened to us?

    Well, to some of us.

    There has always been a jackbooted strain in American politics, the bloody lust of the Red Queen to “off with their heads.” But until recently, it was backwater  – along with things like handling snakes, jabbering in “tongues” and sipping strychnine.

    But these and worse barbarisms wax mainstream.

    Rather than hold those who enforce the law to at least the same standard expected of the rest of us – if not a higher standard – they are to be held to a lesser standard. We, meanwhile, had best not so much as raise our voices to these dispensers of “justice.”

    Remarkable.

    And it’s only taken 70 years for us to get from there to here.

  • Russia Expects China To Help Resolve Syrian Crisis, "Restore The Country"

    Last summer, when the Syrian conflict was near its peak under the Obama administration, China unexpectedly warned it was ready to enter the proxy war when in a stunning announcement, Xinhua reported that Beijing was prepared to side with Syria – and Russia – and against the US-led alliance, and that Xi and Assad had agreed that the Chinese military will have closer ties with Syria and provide humanitarian aid to the civil war torn nation.

    A high-ranking People’s Liberation Army officer also said that the training of Syrian personnel by Chinese instructors has also been discussed: the Director of the Office for International Military Cooperation of China’s Central Military Commission, Guan Youfei, arrived in Damascus on Tuesday for talks with Syrian Defense Minister Fahad Jassim al-Freij, Xinhua added. Guan said China had consistently played a positive role in pushing for a political resolution in Syria. “China and Syria’s militaries have a traditionally friendly relationship, and China’s military is willing to keep strengthening exchanges and cooperation with Syria’s military,” Xinhua quoted Guan.


    Rear Admiral Guan Youfei

    As Reuters also added at the time, China tends to leave Middle Eastern diplomacy to the other permanent members of the U.N. Security Council, namely the United States, Britain, France and Russia, while relying on the region for oil supplies. But over the past two years, China has been trying to get more involved, including sending envoys to help push for a diplomatic resolution to the violence there and hosting Syrian government and opposition figures.

    Fast forward to today when the Syria proxy war is once again at an impasse – especially after today’s warning by Macron that France would get involved after another “chemical attack” –  and once again it may be up to China to be the decisive tiebreaker.

    According to both Sputnik and the Daily Sabah, Moscow is once again hoping “for China’s help in solving the Syrian crisis and restoring the country: Russian Deputy Foreign Minister Igor Morgulov said Monday.

    “Our cooperation with China on Syria at various international venues is unprecedented. We blocked six attempts to pass anti-Syrian resolutions in the U.N. Security Council,” Morgulov said at “Russia and China: Taking on a New Quality of Bilateral Relations” international conference.

    The Russian deputy foreign minister added that Russia values Beijing’s position on the Syrian crisis, and hopes that, “the Chinese partners will continue their efforts to promote a political settlement.”

    “Together we call for a peaceful and political-diplomatic solution to conflicts, without double standards, unilateral action or attempts at ousting regimes. Our approaches coincide, among other things, on the uncompromising fight against terrorism,” Morgulov said.

    To be sure, Russia and China are already largely alligned at the United Nations, where the two nations have repeatedly vetoed Security Council resolutions imposing sanctions against the Assad regime. Moscow has long-standing links to the Assad regime and is its key ally, while China has an established policy of non-intervention in other countries’ affairs, although as noted above that appeared to change in 2016.

    Needless to say, should China break from its policy of direct foreign non-intervention, and should it indeed side with Syria, and Russia, as it hinted it would do last year, the shape of middle eastern geopolitics would change overnight. And now we await the official, or unofficial, response from China to Russia’s “indecent” diplomatic proposal for a joint effort in Syria against the US-led alliance.

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Today’s News 29th May 2017

  • These Powder Kegs Are About To Blow: "Trump Needs To Halt The Downward Spiral That Obama Orchestrated"

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

    President Trump just took a trip to Saudi Arabia in an effort to obsequiously “shore up” the ties.  Expected.  It is expected for any U.S. president to “recertify” the Petrodollar and the commitments to protect the House of Saud that were initiated by Kissinger and Nixon almost five decades ago.  Times change, and administrations change; however, the systems in place are very slow and resistant to modification.  The BRIC nations are shoring up their interests as the U.S. continues to send more naval “support” for South Korea in the form of another aircraft carrier.

    In order to keep the MIC (Military Industrial Complex) happy, defense contracts have to be on the rise: A Republican administration is the foundation for this.  The creation of a threat is ongoing.  The creation of a threat (whether viable or not) is essential to justify the defense contracts and the ongoing deployments of U.S. troops that were initiated under Obama and are continuing under President Trump.  The MIC is too deeply lodged within the framework of the government to extricate in one fell swoop.  It is inexorably intertwined with the fragile (almost skeletal) domestic industrial base of the U.S. economy, as well as all of the foreign policy instituted at home and carried out abroad.

    Europe is redefining itself with Britain’s exit from the EU, and NATO is trying to maintain ties and commitments with Britain even as she dumps the Eurodollar and cuts the economic ties to the other nations.  Yes, the three super-states as outlined in Orwell’s “1984” are well on their way to taking shape: Eurasia, Eastasia, and Oceania (North American and Great Britain).  The sides are posturing themselves both economically and militarily, with several “loose ends” to ties up.  Those loose ends are none other than Syria and North Korea, around which there are two different lines forming: The U.S. and Western allies, and Russia with its Asian and Middle-Eastern alliances.

    The U.S. Congress and the MIC want to invade Syria, and then Iran.  They also want to “clear things up” in Korea.  These nations are in the way of the establishment of a U.S.-controlled hegemony in the areas and a face-off with Russia.  The first part of it is economic in nature: to attempt to stalemate Russia and China with sanctions and interference in trade (such as the maneuver previously mentioned in other articles to run a natural gas pipeline from Qatar into Eastern Europe).

    The Russians have pretty much taken over the Arctic in terms of exploration and mining.  This was enabled to be brought about by none other than Obama, along with the islands off the coast of Alaska that he magnanimously “gave away.”  Obama has left us in very dire straits in our position with the rest of the world: The Middle East is still in a shambles from the “Arab Spring” and all of the debacles in Egypt and Libya; the Eastern European question is not yet solved in relation to Ukraine and the tug-O’-war over it between the U.S. and Russia; Syria and Iran are “powder kegs” about to blow; and the potential for war with North Korea is far from exhausted.

    The President is going to need to take the initiative in order to halt the downward spiral that Obama orchestrated and began prior to his departure.  To avert at (the minimum) a new Cold War, he’ll have to sit down and do a face-to-face with Putin instead of dispatching Tillerson to play ping-pong periodically with Lavrov.  The time is now to head off these alliances between other nations that exclude the U.S. to a detriment.  Such economic alliances eventually always turn into military alliances…based on the need to preserve the flow of money between the nations involved.

    We do not need another Cold War to materialize.  The way to stop it from occurring is through sound diplomacy and strength of position, not through imperialism and posturing.  Therein lies the challenge: the restructuring of iron-clad policies and institutions so as to make a better deal and position for the U.S. and really “draining the swamp” of Washington.  Saudi Arabia, eh?  Well, why don’t we start out the “new deal” by going into all of that untapped oil that we have domestically?  What are we waiting for?  Or is it just a matter of not wanting to tick off the Saudis and changing the status quo of our worthless fiat Petrodollars?  Only time will tell whether true actions will be taken and not another dog-and-pony show to enable the President to be reelected.

  • How America Could End Up In An Unexpected War With China

    Authored by Doug Bandow via The National Interest,

    Three decades ago the People’s Republic of China was an economic backwater. Today the PRC sports the world’s second-largest economy. Shanghai most dramatically illustrates the country’s transformation. The city is filled with stylish office buildings, five-star hotels, luxury stores and foreign visitors.

    Reflecting their success, the Chinese are increasingly confident as well. If not yet a great power, the PRC seems destined to eventually share global leadership with the United States. And its people know that.

    Which means future U.S.-China relations could be rocky.

    Ties turned confrontational under the Obama administration, which announced a “pivot” or “rebalance” to Asia. Washington officials unconvincingly claimed that the policy was not directed against Beijing. The Chinese may be many things, but they are not stupid.

    Candidate Donald Trump sounded like he intended to pursue an even more truculent course, upgrading relations with Taiwan, launching a trade war, blockading Chinese possessions in the South China Sea and pressuring the PRC to “solve” the North Korea problem. But then came the bilateral summit and the president’s one-way love-fest with Chinese president Xi Jinping. All suddenly became sweet and light in Trumpland.

    However, in the long-term the president’s pleasant words backed by an offer of unspecified trade concessions won’t go far in buffering relations between a unipower determined to preserve its dominance and a rising power equally determined to assert itself.

    First, the Trump administration yielded Pacific economic leadership to the PRC. Beijing is likely to find new commercial opportunities, limiting Washington’s ability to do trade harm.

     

    Second, nationalist passions are not easily cooled. The issue is not just a few obstreperous officials who don’t know their country’s proper place. The real challenge is posed by a population that believes in a much greater China.

    So far North Korea has dominated discussions between the two governments. Even if cooperative efforts fail, any damage to the bilateral relationship likely will be contained. At most, application of secondary sanctions against Chinese financial institutions would lead to economic turbulence, not military confrontation.

    Territorial disputes throughout the Asian-Pacific region pose a far tougher test. The Philippines’ unpredictable Rodrigo Duterte has been sparring with Beijing over Scarborough Reef. Tokyo has refused to even acknowledge a dispute over the status of the Senkaku Islands. But that has not prevented China from using air and naval patrols to challenge Japan’s claim.

    America’s primary interest is navigational freedom, which so far the PRC has not attempted to impede. Washington has no territorial claims in the region. But both Manilla and Tokyo are treaty allies, their security guaranteed by America, which means any confrontation between them and China could draw in the United States. At his confirmation hearing Secretary of State Rex Tillerson suggested an even more active American role, barring PRC access to its claimed possessions. That would set up a clash at sea, guaranteeing a naval arms race and creating a trigger for war.

    As pleasant memories from the Mar-a-Lago summit fade, deep disagreements likely will reappear. And the Chinese aren’t likely to back down. For the United States, dominance of a region so far from home is a convenience, an added benefit to America’s almost absolute security in its own hemisphere. For the PRC, preventing Washington’s encroachments along its border is a “core” interest, similar to what Americans have essentially claimed for their entire hemisphere for two centuries.

    Last weekend I attended a conference on maritime issues in Shanghai. Participants were largely academic and policy, not political. However, the Chinese interlocutors were in no mood to compromise. They defended their government’s claims, advocated active measures to assert them, and disdained criticism of Chinese aggressiveness. No one wanted war, but none of them recommended that their nation back down if Washington chose confrontation.

    Indeed, the participants well demonstrated the disparity of interest and intensity which disadvantages America. No one doubts that the U.S. possesses the stronger military. Nor is there any question that Washington would use its superior power if necessary to defend important interests closer to home.

    But it would be far harder for America to use force to ensure its control of the waters along China’s borders and oversight of territorial disputes in which America has no serious stake—who gets to raise their flag over one or another set of barren rocks. And the price of doing so will only rise. It costs the PRC far less to threaten a U.S. carrier than it costs America to protect one. Just how much are Americans prepared to spend to assert what amounts to the convenience of empire rather than essentials of security?

    Moreover, at a time when North Korea tops Washington’s Asian agenda, how much is the Trump administration willing to pay for Beijing’s assistance? According to President Trump, President Xi already has emphasized the limitations of China’s control. The PRC can hardly be expected to dismantle its one military ally if the United States is actively pushing military containment elsewhere in the region.

    Indeed, while Americans tend to view themselves as being Vestal Virgins, attempting to do good in an evil world, citizens of other nations typically take a more cynical view. In Shanghai, as elsewhere, they see Washington speaking of principle while promoting interest, and refusing to apply to itself norms it seeks to impose on others. The Chinese are prepared to yield before superior force, but are not prepared to concede that America always will possess that edge.

    Washington officials should reconsider their approach to China. Military confrontation would be a losing game. No victory would be permanent. An American success would be an invitation for the PRC to rebuild and expand its armed forces for a rematch. And conflict would aid the authoritarian regime in maintaining and expanding its control. A liberal, democratic China would be unlikely to emerge from any war.

    The U.S. needs to prioritize its objectives vis-à-vis China. Washington wants Beijing to democratize, respect human rights, reduce trade and investment barriers, forswear cyberattacks, pressure North Korea, sanction other pariah regimes, abandon territorial claims, and accept permanent U.S. hegemony. No serious state, let alone a nationalistic rising power, could concede such a laundry list. American officials should decide what they most want and how much they are willing to pay.

    Washington also should recalculate what is worth defending. For instance, there is a difference between preserving Tokyo’s and Manila’s control over territories contested by China and the two nations’ independence, which Beijing does not threaten. Indeed, while resolute backing of the former might deter China from acting, it also would ensure Washington’s involvement should an errant sea captain on one side or the other start shooting. Moreover, issuing blank defense checks would encourage friends to be more intransigent and prepare less for trouble.

    Most important, American officials need to separate the objectives of defending America and containing China. The former is relatively easy and inexpensive. It is likely to be long into the future before the PRC is capable of projecting power against America’s Pacific possessions, let alone the homeland.

    In contrast, it will grow ever more expensive for the United States to overcome the far more modest PRC build up necessary to deter outside intervention. How much are Americans prepared to spend to ensure that Washington can contest Chinese influence along China’s borders? The issue is not whether doing so has value. The issue is whether a highly indebted liberal republic can afford to continue doing so, especially when that responsibility more appropriately falls on other nations in the region.

    Even after the ongoing campaign against Western influence, the PRC remains a far more open society than in the early days of the Communist revolution. Hope that political liberalization would follow economic liberalization has been stillborn, but Xi Jinping’s China remains very different from Mao Zedong’s China.

    As such, the PRC might not be an ally, but there is no reason it should be an enemy. Yet attempting to dominate and contain China risks turning it into an angry and well-armed adversary. Instead, Washington should prepare to share global leadership. Far better to yield thoughtfully while shaping the future than to be forced to concede even more under pressure. Just as Great Britain successfully—if not always happily—accommodated the emerging United States of America.

     

  • Does America Need A Northern Border Wall?

    Keeping track of people legally entering and leaving the United States is a formidable task. Nevertheless, the Department of Homeland Security (DHS) has released figures on people who overstay their visas and other legal forms of admissions. Total overstays for 2016 stood at close to 740,000 people, of which up to 630,000 were suspected to still be in the country.

    Infographic: Which Foreign Citizens Overstay Their Visas Most Often? | Statista

    You will find more statistics at Statista

    As Statista's Dyfed Loesche notes, Canadians and Mexicans are the biggest groups of people with non-immigrant admissions to the United States that overstayed their lawfully authorized time period. However, the DHS only counts in arrivals and departures by sea and air as stated in its report.

    Unlike all other countries, the overwhelming majority of visitors from Canada or Mexico enter the United States by land. "The collection of departure information in the land environment is more difficult than in the air and sea", the DHS writes. While many Canadians or Mexicans could fly in ore arrive by boat they might leave the U.S. across the land border.

    So, there's always a degree of uncertainty in the data.

    While Canada and Mexico are the United States' direct neighbors the figures for the rest of the countries shown in the below above probably are more accurate. This overview includes countries that are taking part in the so-called visa waiver program (VWP) and those who don’t. It only shows data for leisure and business visas, not for students.

    The DHS admits that there is a level of uncertainty in how accurate these numbers are and calls them a snapshot. For the air and sea arrivals and departures the department relies on data that commercial and private carriers need to provide.

    Also, the figures include suspected in-country and out-of-country overstays. This means that some of the people who initially overstayed might have already left.

    All of which raises the question – does America need a northern border wall also?

  • The Conspiracy Mill

    5/28/2017 – (GLOBALINTELHUB)– Ever since JFK the word ‘conspiracy theory’ has been used to discredit anyone holding a non-conventional view, such as based on facts regarding the CIA’s role in providing security at Area 51 (and the point being, what are they doing there?).  But since the Trump election ‘conspiracy theorists’ like Alex Jones have been thrust to the forefront of the mainstream information curve.

    It seems now the Democrats will stop at nothing to create their own ‘fake news’ and ‘conspiracies’ to destroy the fairly elected Donald Trump.  But many of us remember it was recently Republicans creating ‘vast right wing conspiracies’ about leading Democrats.  The fact is, there is little difference between the two parties, they are both funded by the same sponsors.  This groundbreaking documentary explains how the world really works from the ground up; the tools used to manipulate the population into blind submission.  This is a must watch – but bear in mind a few tidbits;

    • JFK as an event is completely irrelevant today; however – as it was so deep in the past, it’s possible to analyze it better than more recent events like 911 (even though there is less forensic evidence).  It isn’t just for history buffs, it explains how the world ‘really’ works.  In the case of FX, it shows the simple path leading Nixon to office and finally the creation of a free floating FX regime.  (THINK:  If JFK survived, would we have FX?)
    • The tools built by the military industrial complex post World War 2 have evolved only in technology, they are using the same bag of tricks.  Thus, by understanding how this game works, we can better understand what’s going on today, whether it be how to improve your business, your finances, your portfolio, or understanding of the upside down pyramid structure that runs the world.

     

     

    Importantly, the CIA has been engaged in the conspiracy mill in foreign countries for years.  Part of winning any war, is first winning an information war.  But this strategy was used in a domestic political election, clearly a violation of their mandate.  And, logically – if they will violate their mandate once it is logical to assume they would for any other reason they deem necessary.  Or who knows what lengths they may go through to justify their power and expanding budgets (i.e. Project Blue Beam).

    Message for traders/investors: If you understand how significant events like 911 were rigged, as large scale Hollywood productions, you can understand how markets are rigged, and thus – see things for what they really are.

  • Camille Paglia: Democrats Are Colluding With The Media To Create Chaos

    By Emily Jashinky, originally in the Washingtonm Examiner,

    Camille Paglia is much more worried about the media than about the steady string of Trump-related scandals they claim to be uncovering.

    In a Tuesday interview with the Washington Examiner, Paglia excoriated the press for its coverage of Trump's decision to fire FBI Director James Comey and his alleged sharing of classified information with Russian officials.

    Fresh off a spirited panel with Christina Hoff Sommers hosted by the Independent Women's Forum, the iconic feminist dissident, who serves as a professor of media studies at the University of the Arts, accused journalists of colluding with the Democratic Party in an effort to damage the Trump administration.

    "Democrats are doing this in collusion with the media obviously, because they just want to create chaos," she said when asked to comment on the aforementioned stories.

     

    "They want to completely obliterate any sense that the Trump administration is making any progress on anything."

    The popular author, whose latest book was released in March, pointed to early struggles experienced by previous presidential administrations to illustrate the media's bias against Trump. "Obama's administration for the first six months was chaos," Paglia recalled. "Bill Clinton's was chaos for six months. Nobody holds that against a new person."

    "Those two guys had actually been politicians!" she continued, noting Trump's relative inexperience with government operations.

    Paglia's assessment of media bias in the Trump era leaves little room for optimism.

    "I am appalled at the behavior of the media," she declared. "It's the collapse of journalism."

    As the Examiner reported in April, Paglia, who cast her ballot for Jill Stein last November, is predicting Trump will win re-election in 2020.

    "I feel like the Democrats have overplayed their hand," she said at the time.

    Though the news cycle has moved through plenty of additional scandals in the past month, it appears as though Paglia's assessment of the president's prospects has not changed.

    "I'm looking forward to voting Democrat again," the acclaimed philosopher explained. "But the point is I feel that the media has so utterly lost its credibility that I think people are going to vote against the media again."

  • Yuan Funding Costs Spike As China Changes FX Rules

    The effects of China's rules-change proposals around the Yuan Fix are already starting to show in the FX, money markets as one-week funding costs have exploded to the annualized equivalent of 14%

    As a reminder, we reported late last week that China announced it would introduce a new "counter-cyclical factor" to reduce exchange-rate volatility while undermining efforts to increase the role of market forces. In some ways this announcement was not unexpected: recall that after a period of eerie stability, on Thursday the Yuan surged shortly after China's downgrade by Moody's, which prompted speculation that the central bank was directly manipulating the currency as the PBOC’s daily fixings had "materially diverged" from the prescribed formula, resulting in a gap between the reference rate and currency’s spot value.

    Roughly at the same time as a similar move was taking place on Friday, Bloomberg first reported and China later confirmed that policy makers would add a “counter-cyclical factor” to the yuan’s daily fixing, a move which "would give authorities more control over the fixing and restrain the influence of market pricing." Subsequent detailed revealed that authorities would change the daily $/CNY fixing mechanism, so that the change of the fixing from the previous day’s close would also take into account a “counter-cyclical  adjustment factor” (how this is determined is not specified though), in addition to the USD’s movement against a basket of currencies.

    While the practical consequence was a surge in both the onshore and offshore Yuan to three month highs, traders and commentators were left confused by this latest intervention by Beijing into what has become China's fulcrum security.

    “The counter-cyclical adjustment factor sounds like an increased role for the fixing to be nudged away from where markets would set it,” Sean Callow of Westpac Banking Corp told Bloomberg. “The authorities’ actions give the impression that they are more worried about yuan stability than declared in their public statements.”

    The reaction has been notable…

    Offshore Yuan has spiked dramatically in the last few days – coinciding with apparent Fed dovishness in the minutes and PBOC rule changes…

     

    And, as Bloomberg details, deliverable yuan funding costs have soared after the PBOC said it’s considering changing the way it calculates the yuan daily reference rate. One-week forward points have more than doubled to the equivalent of about a 14 percent annualized interest rate.

    Though traders anticipate that funding costs will retreat after month-end, a policy shift may keep markets on edge — on two previous occasions the PBOC adjusted its fixing mechanism, in 2015 and earlier in 2017, costs remained elevated for weeks.

  • They're Killing Small Business: The Number Of Self-Employed Americans Is Lower Than It Was In 1990

    Authored by Michael Snyder via The Economic Collapse blog,

    After eight long, bitter years under Obama, will things go better for entrepreneurs and small businesses now that Donald Trump is in the White House?

    Once upon a time, America was the best place in the world for those that wanted to work for themselves.  Our free market capitalist system created an environment in which entrepreneurs and small businesses greatly thrived, but today they are being absolutely eviscerated by the control freak bureaucrats that dominate our political system.  Year after year, leftist politicians just keep piling on more rules, more regulations, more red tape and more taxes.  As a result, the number of self-employed Americans is now lower than it was in 1990

    In April 1990, 8.7 million Americans were self-employed, but today only 8.4 million Americans are self-employed.

    Of course our population has grown much, much larger since that time.  In 1990, there were 249 million people living in the United States, but today there are 321 million people living in this country.

    What this means is that the percentage of the population that is self-employed is way down.

    In fact, one study found that the percentage of Americans that are self-employed fell by more than 20 percent between 1991 and 2010.

    And if you go back even farther, the numbers are even more depressing.  It may be hard to believe, but the percentage of “new entrepreneurs and business owners” declined by a staggering 53 percent between 1977 and 2010.

    Sometimes I like to watch a television show called Shark Tank, and on that show they make it seem like entrepreneurship in America is thriving.

    But the exact opposite is actually the case.  In a previous article, I discussed how the number of new businesses being created in the United States has been steadily falling over the years.  According to economist Tim Kane, the number of startup jobs per one thousand Americans has been declining for several consecutive presidential administrations

    • Bush Sr.: 11.3
    • Clinton: 11.2
    • Bush Jr.: 10.8
    • Obama: 7.8

    So why is this happening?

    As I mentioned at the top of this article, self-employed Americans are being absolutely strangled by oppressive rules, regulations and taxes.

    To illustrate this point, I would like to share with you some quotes from an open letter that was authored by a small business owner named Don Chernoff…

    #1 I work for myself and have to pay my own medical expenses. Before the “affordable care act” I was paying about $200 per month for a high deductible policy. It was far from perfect but it got so much worse under the “Affordable” care act.

     

    I now pay over $400 a month, my deductible went from $5,000 to over $6,000 and my out of pocket costs for care have skyrocketed.

     

    #2 I have to spend dozens of hours and thousands of dollars for a tax accountant each spring to prepare my taxes because I cannot possibly understand how to do it myself, and I have a master’s degree in engineering.

     

    #3 Many years ago when I quit a perfectly good job to start my own small business, I was shocked to learn that I had to pay both my share and what had been my employer’s share of Social Security.

     

    #4 Between state, federal and local taxes you’ve probably paid 50% or more of your income in taxes, but that’s not enough for politicians.

     

    If you’ve been lucky enough to have created a business you can sell, now you’ll get to enjoy paying another tax on the capital gain from the sale.

    This is another reason why we need a conservative revolution in Washington.  We should demand that our members of Congress lower tax rates dramatically, completely eliminate the self-employment tax, greatly simplify the tax code and get rid of as many regulations on small business owners as possible.

    In fact, if it was up to me I would abolish a number of federal agencies completely.

    What we are doing right now is not working.  Small businesses have traditionally been one of the main engines of economic growth in this country, but thanks to the left they are unable to play that role at the moment.

    It isn’t an accident that over the last ten years the U.S. economy has grown at exactly the same rate as it did during the 1930s.

    If we want our economy to be great again, we need to go back and start doing the things that made it great in the first place.  If we continue to suffocate our economy, we will continue to get the same results.

    And with each passing day, we get more signs that the economy is heading into another major downturn.  For instance, we just learned that Sears is closing 30 more stores on top of the 150 that had already been announced…

    Sears Holdings, which wasn’t shy when it announced at the start of the year that it is closing 150 underperforming stores, has quietly added at least 30 more to the list.

     

    Another 12 Sears stores and 18 Kmarts are among the locations that are closing, from Carson, Calif., to Hialeah, Fla., with most scheduled to shut their doors in July, based on calls to the stores, malls and confirmation in local media.

     

    At the start of the year, the retailer pinpointed the 150 stores it said it would close. But it declined this week to provide a list of additional locations that are slated to shut since then, saying that it update store counts each quarter.

    In addition, we just learned that new home sales in April were 11.4 percent lower than they were in March

    If you’re surprised by the collapse in new home sales in April, then you’re not paying attention.

     

    The 11.4% MoM plunge in new home sales in April was 5 standard deviations below expectations and the biggest since March 2015.

    Yes, the stock market is holding up for the moment, but for most Americans the “real economy” just continues to deteriorate Just because we are at the end of a giant financial bubble does not mean that everything is going to be okay.

    The numbers that I brought up in this article are just another example of our long-term economic decline.  In a healthy economy, entrepreneurs and small businesses would be thriving.  But instead, they are being systematically strangled out of existence by a political system that is wildly out of control.

  • Russia And Iran Sign Oil-For-Goods Barter Deal; Escape Petrodollar

    Iran signed an agreement with Russia under which it has broken free from the petrodollar, and will “sell”, or rather barter crude oil to Russia in exchange for products. The announcement was made by Iran’s Oil Minister Bijan Zanganeh, as reported by Russia’s RIA and TASS news agencies.

    “The deal has been concluded. We are just waiting for the implementation from the Russian side. We have no difficulties; we signed the contract, everything is coordinated between the parties. We are waiting for Russian oil companies to send tankers,” he said, as quoted by Russian news agencies. While sanctions against Iran have been lifted, restrictions on trade in US dollars for the country’s banks remain, making it difficult to sell oil on the open market.

    As reported here just over three years ago, the $20 billion agreement was initially signed in April 2014 when Iran was under Western sanctions over its nuclear program. Russian traders were to participate in the selling of Iranian oil. In exchange, Iran wanted essential goods and technology from Russia.

    This is what Reuters reported in April 2014 when the deal was first announced:

    Iran and Russia have made progress towards an oil-for-goods deal sources said would be worth up to $20 billion, which would enable Tehran to boost vital energy exports in defiance of Western sanctions, people familiar with the negotiations told Reuters.

     

    In January Reuters reported Moscow and Tehran were discussing a barter deal that would see Moscow buy up to 500,000 barrels a day of Iranian oil in exchange for Russian equipment and goods.

     

    The White House has said such a deal would raise “serious concerns” and would be inconsistent with the nuclear talks between world powers and Iran.

    Little did the US know back in 2014 that less than three years later, Russia would also be running the US, courtesy of wholesale manipulation of tens of millions of Americans, whom it hacked and convinced to vote for Trump.

    Sarcasm aside, when the sanctions against Tehran were lifted in 2016, Russian Energy Minister Alexander Novak said the deal was no longer necessary. However, Novak said in March 2017 that the plan was back on the table with Russia buying 100,000 barrels per day from Iran and selling the country $45 billion worth of goods, Russia Today reported.

    Russia and Iran discussed energy, electricity, nuclear energy, gas and oil, as well as cooperation in the field of railways, industry, and agriculture.

    Novak had announced in February that Russia’s state trading enterprise Promsirieimport has been authorized by the government to carry out the purchase of Iran’s oil through the oil-for-goods program under study by both countries. Meanwhile, Zanganeh had been quoted by the media as saying that Iran would be paid in cash for half of the oil that would be sold to Russia.  The due payments for the remaining half would be made in goods and services, the Iranian minister had said. 

    A February report by the International Monetary Fund said that while Iran has been reconnected to SWIFT, significant challenges prevent Iranian banks fully-reconnecting to global banks still exist mostly due to remaining US sanctions.

    “US primary sanctions apply to US financial institutions and companies, including their non-US branches (but not their subsidiaries). Moreover, with very limited exceptions, businesses and individuals related to the US continue to be generally prohibited from dealing with Iran, including with the government,” the IMF said.

    “US dollar clearing restrictions have not been lifted and pose a significant challenge for non-US banks who may do business with Iran, but may not be paid in US dollars,” it added.

    And since necessity is the mother of invention, what better way to bypass the world’s reserve currency than to go back to the way commerce was conducted before currencies were even created: through barter.

  • New Home Prices Are Over 50% Higher In Canada Than The US

    Authored by Kaitlin Last via BetterDwelling.com,

    The price of new homes is quickly diverging in Canada and the US.

     Data from the Canadian Housing and Mortgage Corporation (CMHC) show that new homes are selling for substantially more than the same time last year.

     

    Meanwhile south of the border, data from the US Bureau of Census show that new home prices are on the decline.

    This has lead to an even wider gap between the average price of a new home in Canada and the US.

    Canadian New Construction Is Higher

    The price of a new home across Canada is up for the second month in a row. The average sale price in April was CA$751,881 (US$559,123). This represents an 11% increase from the same time last year, when measured in Canadian dollars. When compared in US dollars, that increase drops to a much more conservative 2.64%. Even after factoring in the loonie’s decreased buying power in Canada, new home prices still climbed.

    US New Construction Is Lower

    American new home builders aren’t seeing such steep climbs in sale prices. Actually, they aren’t seeing climbs at all. The average price of a new home in the US was CA$495,271 (US$368,300). This represents a 3% decline from the same time last year, when measured in US dollars. In Canadian dollars, this was a 0.49% decline from the same time last year. Both forms of measurement show declining home prices in the US, curious since their economy is in a much better state than Canada right now.

    US Vs. Canadian Prices

    New homes are trading at substantially higher values in Canada than the US in April. The average new home in April 2017 was 51% higher in Canada than the US. The same time last year, prices in Canada were only 36% higher. It appears in a post-crash United States, new home buyers are taking much more conservative strides. In a hasn’t-crashed-in-decades Canada, new home buyers are optimistic about future values.

    The gap between new home sale prices in Canada and the US is growing substantially. The US is a country with a booming economy, almost 10 times the population of Canada, and less land mass. Somehow, new home prices in the US are dropping compared to the same time last year. In sparsely populated Canada, prices are increasing – despite the precarious position of our economy.

    Are Americans being overly cautious on homeownership, or are Canadians demonstrating irrational exuberance for homeownership, much like the US did in a pre-2006 America? Tell us your thoughts in the comments.

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Today’s News 28th May 2017

  • The Fourth Turning's Neil Howe Warns: We Are In The 1930s, "Winter Is Coming"

    Via Mauldin Economics,

    From the Balkans to the US, walls are going up, not down, according to demographer and The Fourth Turning author Neil Howe.

    Speaking to a packed crowd at Mauldin Economics’ Strategic Investment Conference in Orlando, Howe said we are reliving many of the same trends and changes of the 1930s.

    Faith in Democracy Is Fading

    “Worldwide, people are losing trust in institutions,” he said. “Trust in the military, small business, and police is still there. But trust in democracies, media, and politicians is dropping.”

     

    “When was the last time we saw these changes and the rise of right-wing populism?” he asked. “The 1930s.”

    Howe’s statement is borne out of a June 2016 Gallup poll. When poll takers were asked how much confidence they had in institutions in American society, the results were troubling.

    Just 15% said they had a “great deal” of confidence in the US Supreme Court. Banks trailed behind at 11%, followed by the criminal justice system (9%), newspapers (8%), and big business (6%).

    Meanwhile, just 16% expressed a “great deal” of confidence in the presidency, with that number plummeting to 3% for Congress.

    What Does This Mean for the Future of the West?

    In his keynote, Howe shared his forecasting logic:

    “My method is to step back and realize one thing: There is something we know about the world in 20 years’ time. The people who live there will be all of us, 20 years older and playing a different role. I call this ‘looking along the generational diagonal.’”

    The critical thing to remember about the current crisis period is that what comes next will be an era in which there is a new order.

    According to the Strauss-Howe generational theory, as this new order takes root, individualism declines and institutions are strengthened.

    “History is seasonal, and winter is coming,” Howe has said. But after winter, comes spring.

    As the American Revolution was followed by calm, as the Civil War was followed by reconstruction and a gilded age, and as the Great Depression and World War II were followed by an age of peace and prosperity, so too will this crisis period be followed by a calm, stable era.

    It’s simply a matter of time.

  • Believing The Russian "Hacking" Claim

    Authored by David Swanson via The Strategic Culture Foundation,

    Government lies are common when seducing a population to support a war, but the Russian “hacking” claims are unusual in that U.S. officials supply no evidence while the “fact” is just assumed,

    When the U.S. public was told that Spain had blown up the Maine, or Vietnam had returned fire, or Iraq had stockpiled weapons, or Libya was planning a massacre, the claims were straightforward and disprovable.

    CIA Director John Brennan addresses officials at the Agency’s headquarters in Langley, Virginia. (Photo credit: CIA)

    Before people began referring to the Gulf of Tonkin incident, somebody had to lie that it had happened, and there had to be an understanding of what had supposedly happened. No investigation into whether anything had happened could have taken as its starting point the certainty that a Vietnamese attack or attacks had happened. And no investigation into whether a Vietnamese attack had happened could have focused its efforts on unrelated matters, such as whether anyone in Vietnam had ever done business with any relatives or colleagues of Robert McNamara.

    All of this is otherwise with the idea that the Russian government determined the outcome of the 2016 U.S. presidential election. U.S. corporate media reports often claim that Russia did decide the election or tried to do that or wanted to try to do that. But they also often admit to not knowing whether any such thing is the case.

    There is no established account, with or without evidence to support it, of exactly what Russia supposedly did. And yet there are countless articles casually referring, as if to established fact to the…

    “Russian influence in the 2016 presidential election” (Yahoo).

     

    “Russian attempts to disrupt the election” (New York Times).

     

    “Russian… interference in the 2016 U.S. presidential election” (ABC).

     

    “Russian influence over the 2016 presidential election” (The Intercept).

     

    “a multi-pronged investigation to uncover the full extent of Russia’s election-meddling” (Time).

     

    “Russian interference in the US election” (CNN).

     

    “Russia’s interference in the 2016 presidential election” (American Constitution Society).

     

    “Russian hacking in US Election” (Business Standard).”

    “Obama Strikes Back at Russia for Election Hacking” we’re told by the New York Times, but what is “election hacking”? Its definition seems to vary widely. And what evidence is there of Russia having done it?

    The “Russian interference in the 2016 United States elections” even exists as a factual event in Wikipedia, not as an allegation or a theory. But the factual nature of it is not so much asserted as brushed aside.

    Former CIA Director John Brennan, in the same Congressional testimony in which he took the principled stand “I don’t do evidence,” testified that “the fact that the Russians tried to influence resources and authority and power, and the fact that the Russians tried to influence that election so that the will of the American people was not going to be realized by that election, I find outrageous and something that we need to, with every last ounce of devotion to this country, resist and try to act to prevent further instances of that.” He provided no evidence.

    Activists have even planned “demonstrations to call for urgent investigations into Russian interference in the US election.” They declare that “every day we learn more about the role Russian state-led hacking and information warfare played in the 2016 election.” (March for Truth.)

    Belief that Russia helped put Trump in the White House is steadily rising in the U.S. public. Anything commonly referred to as fact will gain credibility. People will assume that at some point someone actually established that it was a fact.

    Keeping the story in the news without evidence are articles about polling, about the opinions of celebrities, and about all kinds of tangentially related scandals, their investigations, and obstruction thereof. Most of the substance of most of the articles that lead off with reference to the “Russian influence on the election” is about White House officials having some sort of connections to the Russian government, or Russian businesses, or just Russians. It’s as if an investigation of Iraqi WMD claims focused on Blackwater murders or whether Scooter Libby had taken lessons in Arabic, or whether the photo of Saddam Hussein and Donald Rumsfeld shaking hands was taken by an Iraqi.

    A general trend away from empirical evidence has been extensively noted and discussed. There is no more public evidence that Seth Rich (a Democratic National Committee staffer who was murdered last year) leaked Democratic emails than there is that the Russian government stole them. Yet both claims have passionate believers.

    Still, the claims about Russia are unique in their wide proliferation, broad acceptance, and status as something to be constantly referred to as though already established, constantly augmented by other Russia-related stories that add nothing to the central claim. This phenomenon, in my view, is as dangerous as any lies and fabrications coming out of the racist right.

  • US Deploys Third Aircraft Carrier Toward North Korea

    One month ago, when we first discussed that in addition to the CVN-70 Carl Vinson aircraft carrier group, the US was deploying two more carriers toward the Korean peninsula, some took the Yonhap-sourced report skeptically: after all, what’s the incremental symbolic impact of having three, or even two aircraft carriers next to North Korea when just one would more than suffice. Then, two weeks ago, the report was proven half right when US officials announced that in addition to the first US carrier already on location, the US Navy is moving the USS Ronald Reagan aircraft carrier to the Korean Peninsula, where it would conduct dual-carrier training exercises with the USS Carl Vinson.

    Aircraft carrier CVN-76 Ronald Reagan

    After completing its maintenance period in Yokosuka, Japan, the USS Ronald Reagan departed for the Korean Peninsula on Tuesday, according to the Navy. “Coming out of a long in-port maintenance period we have to ensure that Ronald Reagan and the remainder of the strike group are integrated properly as we move forward,” Rear Adm. Charles Williams said in a press release.  Once it arrives in the region, the carrier will conduct a variety of training exercises but primarily focus on certifying its ability to safely launch and recover aircraft, the service said. In other words, training for combat missions involved the North Korean capital.

    We concluded our report from mid-May by saying that the US Navy may soon “further deploy the CVN-68 Nimitz, which was the third carrier reported to be eventually making its way toward Korea.”

    We didn’t have long to wait, because on Friday the Kitsap Sun confirmed what we reported initially over a month ago, namely that the USS Nimitz will depart Naval Base Kitsap-Bremerton on Thursday on its first deployment since 2013. Official details of the deployment were hazy, with spokeswoman Theresa Donnelly saying that The Nimitz-class aircraft carrier is expected to be in the western Pacific for six months with visits to the Middle East and Asia-Pacific, “though plans could change in response to world events.”

    However, a subsequent report from VOAnews confirms that the ultimate destination is none other than the country the US will almost certainly attack next, North Korea:

    The United States is sending a third aircraft carrier strike force to the western Pacific region in an apparent warning to North Korea to deter its ballistic missile and nuclear programs, two sources have told VOA. The USS Nimitz, one of the world’s largest warships, will join two other supercarriers, the USS Carl Vinson and the USS Ronald Reagan, in the western Pacific.

    The Nimitz will lead Carrier Strike Group 11, which includes guided-missile destroyers USS Shoup and USS Kidd from Naval Station Everett, guided-missile destroyers USS Howard and USS Pinckney and guided-missile cruiser USS Princeton from San Diego, and a conglomeration of aircraft squadrons that comprise Carrier Air Wing 11, including Naval Air Station Whidbey Island-based Gray Wolves of Electronic Attack Squadron 142. 


    Aircraft carrier CVN-68 Nimitz

    After returning from its last deployment, the Nimitz underwent a 20-month maintenance and modernization period at Puget Sound Naval Shipyard that was completed in October. It has spent most of the past seven months at sea undergoing training and inspections in preparation for deployment. Now the ship and crew are ready to go, said commanding officer Capt. Kevin Lenox.

    “I am so incredibly proud of the entire Nimitz team and the terrific coordination and support across the entire strike group, especially in such a condensed training cycle,” he said in a news release. “The crew stepped up to the plate, and I’m confident we’re ready to meet whatever challenges lie ahead on our upcoming deployment.”

    While it is rare for the U.S. military to deploy two carriers in the same region at the same time, it is almost unheard of to have three aircraft carriers in close proximity to each other absent current or imminent military action. Which may be the case soon: as VOA notes, North Korea’s growing nuclear and missile threat is seen as a major security challenge for Trump, who has vowed to prevent the country from being able to strike the U.S. with a nuclear missile. 

    Sitting alongside Japanese Prime Minister Shinzo Abe, Trump said on Friday prior to the start of the G-7 meeting in Sicily that world leaders would have a “particular focus on the North Korea problem.” The White House issued a statement on Friday which said the two leaders have agreed to “enhance sanctions on North Korea” in an attempt to prevent the further development of North Korea’s ballistic missile and nuclear programs.

    Meanwhile, as reported on Friday, the U.S. military will test a system to shoot down an ICBM for the first time next week. It is intended to simulate a North Korean ICBM aimed at the U.S. The Missile Defense Agency said it will test an existing missile defense system on Tuesday to try to intercept an ICBM. The Pentagon has used the Ground-Based Midcourse Defense (GMD) system to intercept other types of missiles, but never an ICBM. The GMD has been inconsistent, succeeding in nine of 17 attempts against missiles without intercontinental range capability since 1999.

    So, perhaps as a contingency plan, the US will soon have not one, not two, but three aircraft carriers in the proximity of the Korean peninsula “just in case.” The trip from Naval Station Everett is expected to take several weeks. Meanwhile, here is the latest deployment of US naval forces around the globe as of May 25, courtesy of Stratfor.

  • Visualizing The Expanding Universe Of Cryptocurrencies

    Bitcoin is the original cryptocurrency, and its meteoric rise has made it a mainstay of conversation for investors, media, and technologists alike.

    In fact, as Visual Capitalist's Jeff Desjardins details, the innovation of the blockchain is changing entire markets, while causing ripples with central banks and the financial industry. At time of publication, the bitcoin price now hovers near US$2,200, a massive increase from this time last year.

    But the true impact of Bitcoin is actually far more reaching than this – it’s actually helped to birth new markets for over 800 other cryptocurrencies and assets that are available for online trading. And while the market for bitcoins is worth nearly $40 billion itself, the rest of these cryptocurrencies are actually worth even more in combination.

    Courtesy of: Visual Capitalist

     

    THE ALTCOIN UNIVERSE

    For the first time since Bitcoin was founded, it now makes up the minority of the entire cryptocurrency market at about 47.9% of all coins and assets.

    So what are the other altcoins that make up the rest of this universe, and where did they come from?

    Litecoin

    Litecoin is one of the first altcoins, and it is nearly identical to Bitcoin after being “forked” in 2011. Litecoin aims to process blocks 4x faster than Bitcoin to speed up transaction confirmation time, though this creates several other challenges as well. At time of writing, Litecoin’s market capitalization is worth $1.3 billion.

    Ethereum

    Ethereum, launched in 2015, is the largest coin by market capitalization aside from Bitcoin. However, it is also quite different. While Bitcoin is designed to be a payments protocol first, Ethereum enables developers to build and deploy decentralized applications, while also enabling smart contracts. The tokens used to power the network are called Ether, but they can also be traded online. At time of writing, Ethereum’s market capitalization is $15.4 billion.

    Also interesting: the Ethereum network actually split into two in 2016. It’s a complicated situation, but read about it here. There is now a separate Ethereum, based on the original Ethereum blockchain, trading as “Ethereum Classic” with its own market capitalization of $1.4 billion.

    Ripple

    Ripple (XRP) is the native currency of the Ripple Protocol – a broader catch-all for an open-source, global exchange. It’s already being used by banks such as Santander, Bank of America Merrill Lynch, UBS, and RBC. It solves a different problem than Bitcoin, allowing for settling payments between different currencies and even different payment systems. Today, Ripple’s native coin (XRP) has a market cap of $10.9 billion.

    LEARN MORE

    With over 800+ altcoins or assets out there, there’s plenty of information to absorb.

    Here’s a short 20-minute course on the history of altcoins that might provide useful context, as well as in-depth explanations of Ethereum and Ripple that may help you learn about the important parts of a rapidly growing altcoin universe.

  • Matt Taibbi: "Gianforte's Win Confirms The Democrats Need A New Message"

    Authored by Matt Taibbi via RollingStone.com,

    Democrat Rob Quist was beat by Greg Gianforte in Thursday's special election in Montana

    The story of Greg Gianforte, a fiend who just wiped out a Democrat in a congressional race about ten minutes after being charged with assaulting a reporter, is déjà vu all over again.

    How low do you have to sink to lose an election in this country? Republicans have been trying to answer that question for years. But they've been unable to find out, because Democrats somehow keep failing to beat them.

    There is now a sizable list of election results involving Republican candidates who survived seemingly unsurvivable scandals to win higher office.

    The lesson in almost all of these instances seems to be that enormous numbers of voters would rather elect an openly corrupt or mentally deranged Republican than vote for a Democrat. But nobody in the Democratic Party seems terribly worried about this.

    Gianforte is a loon with a questionable mustache who body-slammed Guardian reporter Ben Jacobs for asking a question about the Republican health care bill. He's the villain du jour, but far from the worst exemplar of the genre.

    New Yorkers might remember a similar congressional race from a few years ago involving a Staten Island nutjob named Michael Grimm. The aptly named Grimm won an election against a heavily funded Democrat despite being under a 20-count federal corruption indictment. Grimm had threatened on camera to throw a TV reporter "off a fucking balcony" and "break [him] in half … like a boy." He still beat the Democrat by 13 points.

    The standard-bearer for unelectable candidates who were elected anyway will likely always be Donald Trump. Trump was caught admitting to sexual assault on tape and openly insulted almost every conceivable demographic, from Mexicans to menstruating women to POWs to the disabled; he even pulled out a half-baked open-mic-night version of a Chinese accent. And still won.

    Gianforte, Trump and Grimm are not exceptions. They're the rule in modern America, which in recent years has repeatedly demonstrated its willingness to vote for just about anybody not currently under indictment for serial murder, so long as that person is not a Democrat.

    The list of winners includes Tennessee congressman Scott Desjarlais, a would-be "family values" advocate. Desjarlais, a self-styled pious abortion opponent, was busted sleeping with his patients and even urging a mistress to get an abortion. He still won his last race in Bible country by 30 points.

    WASHINGTON, DC - MARCH 05:  House Oversight and Government Reform Committee member Rep. Scott Desjarlais (R-TN) (L) makes a photograph with his iPhone during a hearing in the Rayburn House Office Building with Rep. Pat Meehan (R-PA) March 5, 2014 in Washington, DC. Chairman Darrell Issa (R-CA) adjuourned after the witness, former Internal Revenue Service official Lois Lerner, exercised her Fifth Amendment right not to speak about the IRS targeting investigation during the hearing.  (Photo by Chip Somodevilla/Getty Images)

    Scott Desjarlais

    The electoral results last November have been repeated enough that most people in politics know them by heart. Republicans now control 68 state legislative chambers, while Democrats only control 31. Republicans flipped three more governors' seats last year and now control an incredible 33 of those offices. Since 2008, when Barack Obama first took office, Republicans have gained somewhere around 900 to 1,000 seats overall.

    There are a lot of reasons for this. But there's no way to spin some of these numbers in a way that doesn't speak to the awesome unpopularity of the blue party. A recent series of Gallup polls is the most frightening example.

    Unsurprisingly, the disintegrating Trump bears a historically low approval rating. But polls also show that the Democratic Party has lost five percentage points in its own approval rating dating back to November, when it was at 45 percent.

    The Democrats are now hovering around 40 percent, just a hair over the Trump-tarnished Republicans, at 39 percent. Similar surveys have shown that despite the near daily barrage of news stories pegging the president as a bumbling incompetent in the employ of a hostile foreign power, Trump, incredibly, would still beat Hillary Clinton in a rematch today, and perhaps even by a larger margin than before.

    If you look in the press for explanations for news items like this, you will find a lot of them. Democrats may have some difficulty winning elections, but they've become quite adept at explaining their losses.

    According to legend, Democrats lose because of media bias, because of racism, because of gerrymandering, because of James Comey and because of Russia (an amazing 59 percent of Democrats still believe Russians hacked vote totals).

    Third-party candidates are said to be another implacable obstacle to Democratic success, as is unhelpful dissension within the Democrats' own ranks. There have even been whispers that last year's presidential loss was Obama's fault, because he didn't campaign hard enough for Clinton.

    The early spin on the Gianforte election is that the Democrats never had a chance in Montana because of corporate cash, as outside groups are said to have "drowned" opponent Rob Quist in PAC money. There are corresponding complaints that national Democrats didn't do enough to back Quist.

    Greg Gianforte, chairman and chief executive officer for RightNow Technologies Inc., stands for a photograph before taking part in a Bloomberg via Getty Images West interview in San Francisco, California, U.S., on Tuesday, June 21, 2011. RightNow Technologies Inc., which helps businesses offer online and live-chat customer service, typically goes through about 100 resumes to hire one person who has the necessary math, science and computer technology training. Photographer: David Paul Morris/Bloomberg via Getty Images

    Greg Gianforte

    A lot of these things are true. America is obviously a deeply racist and paranoid country. Gerrymandering is a serious problem. Unscrupulous, truth-averse right-wing media has indeed spent decades bending the brains of huge pluralities of voters, particularly the elderly. And Republicans have often, but not always, had fundraising advantages in key races.

    But the explanations themselves speak to a larger problem. The unspoken subtext of a lot of the Democrats' excuse-making is their growing belief that the situation is hopeless – and not just because of fixable institutional factors like gerrymandering, but because we simply have a bad/irredeemable electorate that can never be reached.

    This is why the "basket of deplorables" comment last summer was so devastating. That the line would become a sarcastic rallying cry for Trumpites was inevitable. (Of course it birthed a political merchandising supernova.) To many Democrats, the reaction proved the truth of Clinton's statement. As in: we're not going to get the overwhelming majority of these yeehaw-ing "deplorable" votes anyway, so why not call them by their names?

    But the "deplorables" comment didn't just further alienate already lost Republican votes. It spoke to an internal sickness within the Democratic Party, which had surrendered to a negativistic vision of a hopelessly divided country.

    Things are so polarized now that, as Georgia State professor Jennifer McCoy put it on NPR this spring, each side views the other not as fellow citizens with whom they happen to disagree, but as a "threatening enemy to be vanquished."

    The "deplorables" comment formalized this idea that Democrats had given up on a huge chunk of the population, and now sought only to defeat and subdue their enemies.

    Many will want to point out here that the Republicans are far worse on this score. No politician has been more divisive than Trump, who explicitly campaigned on blaming basically everyone but middle American white people for the world's problems.

    This is true. But just because the Republicans win using deeply cynical and divisive strategies doesn't mean it's the right or smart thing to do.

    Barack Obama, for all his faults, never gave in to that mindset. He continually insisted that the Democrats needed to find a way to reach lost voters. Even in the infamous "guns and religion" episode, this was so. Obama then was talking about the challenge the Democrats faced in finding ways to reconnect with people who felt ignored and had fled to "antipathy toward people who aren't like them" as a consequence.

    Even as he himself was the subject of vicious and racist rhetoric, Obama stumped in the reddest of red districts. In his post-mortem on the Trump-Clinton race, he made a point of mentioning this – that in Iowa he had gone to every small town and fish fry and VFW hall, and "there were some counties where I might have lost, but maybe I lost by 20 points instead of 50 points."

    Most people took his comments to be a dig at Clinton's strategic shortcomings – she didn't campaign much in many of the key states she lost – but it was actually more profound than that. Obama was trying to point out that people respond when you demonstrate that you don't believe they're unredeemable.

    You can't just dismiss people as lost, even bad or misguided people. Unless every great thinker from Christ to Tolstoy to Gandhi to Dr. King is wrong, it's especially those people you have to keep believing in, and trying to reach.

    The Democrats have forgotten this. While it may not be the case with Quist, who seems to have run a decent campaign, the Democrats in general have lost the ability (and the inclination) to reach out to the entire population.

    They're continuing, if not worsening, last year's mistake of running almost exclusively on Trump/Republican negatives. The Correct the Record types who police the Internet on the party's behalf are relentless on that score, seeming to spend most of their time denouncing people for their wrong opinions or party disloyalty. They don't seem to have anything to say to voters in flyover country, except to point out that they're (at best) dupes for falling for Republican rhetoric.

    But "Republicans are bad" isn't a message or a plan, which is why the Democrats have managed the near impossible: losing ground overall during the singular catastrophe of the Trump presidency.

    The party doesn't see that the largest group of potential swing voters out there doesn't need to be talked out of voting Republican. It needs to be talked out of not voting at all. The recent polls bear this out, showing that the people who have been turned off to the Democrats in recent months now say that in a do-over, they would vote for third parties or not at all.

    People need a reason to be excited by politics, and not just disgusted with the other side. Until the Democrats figure that out, these improbable losses will keep piling up.

  • Albert Edwards: "What On Earth Is Going On With US Wages"

    When Albert Edwards predicted in late 2016 that a surge in wage inflation was imminent, we were confused by this prediction from the world’s preeminent deflationist: after all, not only had not a single economic indicator validated a tighter labor market despite unemployment just above 4%, but as we have have repeatedly demonstrated what little wage inflation existed, was attributable to managerial-level, supervisory positions while the bulk of job creation remained with minimum-wage jobs, which have continued to see virtually no wage growth. Even Morgan Stanley, a far greater bull than Edwards, one month ago admitted that “wage growth is leveling off, may be slowing.

    Which is why we have to give Edwards credit: some 6 months after his initial call, he had the courage to do what is never easy and admit he was wrong, and that contrary to his expectations wages are not going up after all.

    Talking about wrong, I have to put my hands up. I have been expecting US wage inflation to roar ahead over the past three months to well above 3%, yet every data release has surprised on the downside. Wage inflation, as measured by average hourly earnings, has actually levelled off at close to 2½% while wage inflation for ‘the workers’ is actually slowing (see chart below)! Strictly speaking, “the workers” are defined (by the BLS) as “those who are not primarily employed to direct, supervise, or plan the work of others. Hey, that’s me!

    So with the concession aside, Edwards is left with even more question, starting with “What on earth is going on with US average hourly earnings?”

    Three consecutive Employment Reports have seen this key measure of wage inflation surprise by its weakness. I feel especially foolish as I had written that wages were set to accelerate sharply, forcing the Fed to tighten aggressively and thereby driving both bond yields and the dollar higher. Doh! While many commentators last year, including the Fed, expressed surprise that US wage inflation had been so quiescent despite a tight labour market, I thought there was a simple explanation. I believe that nominal wages had not accelerated more rapidly through 2016 primarily because headline CPI inflation had been so subdued, staying in a 0-1% range for most of the last couple of years. Hence nominal wages did not need to accelerate rapidly for workers to be much better off as 2-2½% nominal wage inflation translated into  strong real wage rises of around 1½-2% – the most rapid for years (see circled area in chart below).

     

     

    As headline CPI inflation surged this past six months, rapid real wage growth turned into real wage stagnation (see chart above). I believed that a tight labour market would prompt an aggressive reaction from “the workers” to maintain the previous 1½-2% rate of real wage inflation they had enjoyed and got used to through 2015 and 1H 2016. Hence I expected nominal wage inflation would roar upwards in 1Q this year. How wrong I was!

    There is even more confusion in the data, because Edwards points out another disconnect: while the BLS’ measure of hourly earnings has gone nowhere, and real earnings have in fact tumbled, the employment cost index has spiked, “with wage and Salaries jumping from a 0.5% rise in 4Q to rise by 0.8% in 1Q 2017 ? the fastest quarterly rise since 2007. On a yoy basis, this measure of wage inflation still showed a 45 degree upward trajectory into 1Q 2017 (see left-hand chart below). Adding benefits to wages and salaries, total compensation also rose by 2½%.”

    Then there is the issue of declining productivity, because when calculating productivity and unit labour cost growth, the BLS estimates non-farm businesses saw their workers compensation jump from the 3% average rate seen in 2016 to just shy of 4% yoy in 1Q 2017?. This has implications on corporate profits:

    “Together with sluggish 1% productivity growth, this means that unit labour costs are rising by almost 3% yoy, well in advance of the rate by which corporates are able to raise their output prices (see right-hand chart above). The bottom line is that US corporate margins are suffering a savage squeeze and have been for some time. What then do I make of the heady 1Q company reporting round? Not much.”

    Perhaps in retrospect, between the divergent AHE and ECI data, Edwards was not entirely wrong, as he suggests:

    The truth is that the closely watched average hourly earnings measure of wage inflation has not accelerated in response to a surge in headline CPI in the way I had expected. So strictly speaking I have been wrong and as such I must throw myself upon your bountiful mercy. But let me say in my defence that other measures of wage inflation have shown exactly the acceleration I had expected. The fight-back by labour to secure their rightful share of the economic pie is ongoing, but it seems likely that the savage downward trend in the share of labour compensation that had been in place since the 2001 recession seems to have at last been broken (see chart below). The laws of economics have not been abolished after all ? at least not in the US.

    Yet while the jury may still be out on US wages between two contradictory data sets from the BLS, when one looks outside the US, things are clear: despite years of QE, there is no wage growth. For evidence, look no further than Japan. Edwards again:

    Japan is becoming an economic enigma. Last week saw some truly astonishingly weak wage inflation data ? so weak that it sent the yen sharply lower on expectations that the Bank of Japan might need to step up their already ridiculously outsized QE programme to even higher levels. Wages for March fell by 0.4% yoy, well below both the expected 0.5% gain and February’s 0.4% rise. Even the far less erratic underlying wages (excluding overtime and bonus payments) weakened sharply and declined yoy in March. In real terms, total cash earnings were miserable too, falling by 0.8% from a flat reading in February (see charts below). Certainly on this measure Abenomics has been a total and utter failure.

     

     

    The idea was simple, QE (or QQE as the Japanese call it) would as an indirect consequence send the yen sharply lower (as it did in 2013/14), which would push up headline CPI inflation (also buoyed by the 2014 VAT hike) and drive wages higher in what was a tight labour market.

     

    And when I say tight, I mean properly tight. This is not the US, where most commentators agree there is likely to be more slack than the low headline unemployment numbers suggest due to the sharp decline in the participation rate since the last recession. By contrast, the Japanese labour market is unambiguously as tight as it ever has been in history (see left-hand chart below). Yet wage inflation remains moribund.

     

     

    Without any real cost-push wage pressures, and with the initial inflationary impulse on headline and core CPI of the declining yen of 2013-14 receding into a distant memory, core CPI inflation (ex food and energy) has begun to fall once again (for this see right-hand chart above, and note that headline and CPI ex-food are rising moderately only because the yoy impact of the oil price has gone from negative last year to positive this year). So after all the trillions of dollars of QE and huffing and puffing, Abenomics has failed to deliver its much touted exit from the deflationary mire.

    And before readers respond with “there is always more QE”, the problem is that for both the ECB and BOJ, the answer is increasingly, “there isn’t” as both central banks are just months away from running out of eligible bonds to buy, beyond which point the entire bond market may simply lock up, or the central banks will have to even more actively start buying equities, with both outcomes effectively a nationalization of capital markets. And the last time we checked with the USSR, that strategy did not work out too well…

  • Federal Bureaucrats To The Public: Be Afraid!

    Authored by Ryan McMaken via The Mises Institute,

    States have always thrived on the fear of the taxpayers, and states have always justified their existence in part on the idea that without the state, we'd all be overrun by barbarians, or murdered by our neighbors. Charles Tilly, a historian of the state, frequently noted that the modern state as we know it, was born out of war, and was created to wage war. War and the state are inseparable. 

    Moreover, support for the state is so central to maintaining continued funding and deference to the state's monopoly power, that Randolph Bourne famously went so far as to say that "war is the health of the state."  

    By extension, agents of the state — whether elected officials or bureaucrats — fancy themselves as guardians of prosperity and civilization. Without them, they apparently believe, life would be barely worth living. 

    Thus, one should hardly be surprised when government bureaucrats spread fear as a means of self-promotion. 

    Keeping this tradition alive is Department of Homeland Security John Kelly who recently claimed that people would "never leave the house" if they "knew what I know about terrorism." 

    This, incidentally, introduces a new variation on the time-worn they're-coming-to-get-us propaganda that the state has relied on for centuries. Nowadays, we're not even allowed to know what the threat is.

    "It's a secret, so just trust us." is the refrain. "They're coming to kill us. We swear it's true."

    Kelly then punctuated his comments with an advertisement for the federal government, concluding  

    The good news is, for us in America, we have amazing people protecting us every day, DHS, obviously, FBI, fighting the away game is DOD Department of Defense, CIA, NSA, working with these incredible allies we have in Europe and around the world.

    What counts as "protecting us every day," is apparently a bit different for Kelly than for more astute observers. 

    James Bovard recently described how the FBI has been doing such a great job keeping us safe: 

    Before the 9/11 attacks, the FBI dismally failed to connect the dots on suspicious foreigners engaged in domestic aviation training. Though Congress had deluged the FBI with $1.7 billion to upgrade its computers, many FBI agents had old machines incapable of searching the Web or emailing photos. One FBI agent observed that the bureau ethos is that "real men don’t type. … The computer revolution just passed us by."

     

    The FBI’s pre-9/11 blunders "contributed to the United States becoming, in effect, a sanctuary for radical terrorists," according to a 2002 congressional investigation. (The FBI also lost track of a key informant at the heart of the cabal that detonated a truck bomb beneath the World Trade Center in 1993.)

    "Everyone makes mistakes!" Might be what the FBI's-backers claim. True enough. But few organizations get paid 8 billion dollars per year of the taxpayers' money to not stop terrorists.

    So, it's unclear what Kelly is referring to in how we'd all be dead were it not for federal agents. 

    Perhaps he's referring to the CIA. The same CIA that planned the disastrous Bay of Pigs invasion, and then spent decades paying spies to report on how the Soviet economy was growing impressively, estimating the Soviet economy to be three times the size of what it actually was. The implication, of course, was that the USSR was a powerhouse that could defeat the US in an arms race. 

    One can guess what CIA agents were saying at the time: "If you knew what we know about the Soviet economy, you'd never leave the house!" 

    Kelly also refers to the NSA. This is the same NSA that allowed Edward Snowden to walk off with countless numbers of their own top-secret documents. And its lack of control over its own information enabled this month's malware attack that infected computers in 99 countries. The attack was not stopped by the NSA, of course. 

    These are those "amazing people" that keep us safe, according to Kelly.

    And then there's the Department of Defense. The centerpiece of a military establishment that hasn't won a major conflict since 1945. The "victory" in Iraq in 1991 wasn't even complete enough to end the economic sanctions imposed on Iraq before the war started. Those sanctions persisted until 2003. 12 years after the first "victory" the US then attacked Iraq again, thus promoting the spread of Islamic extremism and causing a civil war that led to the near-destruction of Iraq's few remaining Christian communities. 

    "Before the United States invaded Iraq, Al Qa’ida was on the ropes…" the Brookings institution concluded in 2007. "The invasion of Iraq breathed new life into the organization."

    Meanwhile, the Pentagon doesn't know what it did with six trillion dollars. 

    Fortunately for us, the US's most implacable enemy today is ISIS, which has no air force, no navy, and is composed largely of depressed outsiders whose deadliest weapons outside of Iraq and Syria are delivery trucks. 

    It doesn't take an army, or an FBI, or a CIA to stop crazies from driving trucks into crowds on Bastille day, as one did in 2016. It requires that police keep unauthorized trucks off pedestrian malls during festivals. 

    Nor are secret police required to keep people from carrying bombs into crowded theaters. Competent security guards can do the trick. The same might be said of maniacs carrying semi-automatic rifles into night clubs

    But of course Kelly would likely claim that the government is preventing far greater attacks than these. He just can't tell us what any of them might be, or give any details at all. 

    Nevermind that in situations like this, the burden of proof is always on the government agency that  wants more tax dollars and more power to keep doing what they're doing. The claim of necessary secrecy offers a convenient excuse from having to provide an evidence at all. 

    But, there's always enough violence and mayhem in the world to try to convince people that the world is falling apart. Although the chances of being murdered in an American city are at a 50-year low (unless you're in certain neighborhoods of Chicago and Baltimore) many Americans believe crime is worse than ever. Pew has noted that at the homicide rate was cut in half over the past 20 years, Americans persist in the idea that crime is getting worse. 

    Moreover, under the Obama administration, the feds claimed that mass-shootings were sweeping the country. In fact, the odds of dying in a mass shooting are so low that they might as well be zero. 

    The hysteria over shootings, however, was a convenient justification for the federal government's ongoing attempts to regulate firearms. 

    "If you knew what I know about gun violence" Obama might have said. "you'd never leave the house!" 

    Creative arithmetic is also being used to justify public fear over terrorism. Kelly's comments invoked this week's massacre in Manchester where 22 people (not including the attacker) were murdered. But, if you're worrying about homicides in England, you'd might want to look to street crime instead. After all, in England and Wales, homicides increased by 121 (21 percent) from 2015 to 2016, largely fueled by stabbings and shootings of the traditional variety. 

    Unfortunately, many Americans have been trained to believe whatever they're told by higher authorities. The specifics vary according to one's politics. Leftists appear ready to believe whatever some federal bureaucrat says about global warming — provided it fits into the leftwing narrative. 

    Rightwingers are primed to believe whatever some government agents says that confirms their narrative about national security.

    To illustrate the skepticism one should bring to comments such as those made by Kelly, let's use the same format, and apply it to claims that might be made from across the ideological spectrum:

    "If you knew what I know about the state of our lakes and rivers, you'd never drink any water!" said the director of the EPA…

     

    "If you knew what I know about our economy, you'd never trust private industry!" said Senator Elizabeth Warren…

     

    "If you knew what I know about kidnappings, you'd never let your children out of your sight!" said FBI director…

     

    "If you knew what I know about global warming, you'd never drive a car again!" said President…

    And so on. 

    When confronted with a blanket claim that it's obvious to those "in the know" that hysterical fear is warranted, we might be inclined to demand more convincing evidence. But, if what is said just supports our existing biases, then no evidence is necessary. The self-serving opinion of a government bureaucrat is all that's required.

     

  • The Golden Conspiracy

    Authored by Jim Rickards via The Daily Reckoning blog,

    Is there gold price manipulation going on? Absolutely. There’s no question about it. That’s not just an opinion.

    There is statistical evidence piling up to make the case, in addition to anecdotal evidence and forensic evidence. The evidence is very clear, in fact.

    I’ve spoken to members of Congress. I’ve spoken to people in the intelligence community, in the defense community, very senior people at the IMF. I don’t believe in making strong claims without strong evidence, and the evidence is all there.

    I spoke to a PhD statistician who works for one of the biggest hedge funds in the world. I can’t mention the fund’s name but it’s a household name. You’ve probably heard of it. He looked at COMEX (the primary market for gold) opening prices and COMEX closing prices for a 10-year period. He was dumbfounded.

    He said it was is the most blatant case of manipulation he’d ever seen. He said if you went into the aftermarket, bought after the close and sold before the opening every day, you would make risk-free profits.

    He said statistically that’s impossible unless there’s manipulation occurring.

    I also spoke to Professor Rosa Abrantes-Metz at the New York University Stern School of Business. She is the leading expert on globe price manipulation. She actually testifies in gold manipulation cases that are going on.

    She wrote a report reaching the same conclusions. It’s not just an opinion, it’s not just a deep, dark conspiracy theory. Here’s a PhD statistician and a prominent market expert lawyer, expert witness in litigation qualified by the courts, who independently reached the same conclusion.

    Now, where is the manipulation coming from?

    There are a number of suspects but you need look no further than China.

    China wants to do what the U.S. has done, which is to remain on a paper currency standard but make that currency important enough in world finance and trade to give China leverage over the behavior of other countries.

    The best way to do that is to increase its voting power at the IMF and have the yuan included in the IMF basket for determining the value of the special drawing right (SDR).

    China accomplished that last September when the IMF added the yuan to its basket of currencies.

    The rules of the game also say you need a lot of gold to play, but you don’t recognize the gold or discuss it publicly. Above all, you do not treat gold as money, even though gold has always been money.

    The members of the club keep their gold handy just in case, but otherwise, they publicly disparage it and pretend it has no role in the international monetary system. China is expected to do the same.

    Right now, China officially does not have enough gold to have a “seat at the table” with other world leaders. Think of global politics as a game of Texas Hold’em.

    What do want in a poker game? You want a big pile of chips.

    Gold serves as political chips on the world’s financial stage. It doesn’t mean that you automatically have a gold standard, but that the gold you have will give you a voice among major national players sitting at the table.

    For example, Russia has one-eighth the gold of the United States. It sounds like they’re a small gold power — but their economy’s only one-eighth as big. So, they have about the right amount of gold for the size of their economy. And Russia has ramped up its gold purchases recently.

    The U.S. gold reserve at the market rate is under 3% of GDP. That number varies because the price of gold varies. For Russia, it’s about the same. For Europe, it’s even higher — over 4%.

    In China, that number has been about 0.7% officially. Unofficially, if you give them credit for having, let’s say, 4,000 tons, it raises them up to the U.S. and Russian level. But they want to actually get higher than that because their economy is still growing, even if it’s at a much lower rate than before.

    Here’s the problem: If you took the lid off of gold, ended the price manipulation and let gold find its level, China would be left in the dust. It wouldn’t have enough gold relative to the other countries, and because the price of gold would be skyrocketing, they could never acquire it fast enough. They could never catch up. All the other countries would be on the bus while the Chinese would be off.

    When you have this reset, and when everyone sits down around the table, China’s the second largest economy in the world. They have to be on the bus. That’s why the global effort has been to keep the lid on the price of gold through manipulation. I tell people, if I were running the manipulation, I’d be embarrassed because it’s so obvious at this point.

    The price is being suppressed until China gets the gold that they need. Once China gets the right amount of gold, then the cap on gold’s price can come off. At that point, it doesn’t matter where gold goes because all the major countries will be in the same boat. As of right now, however, they’re not, so China has though to catch-up.

    I’ve described some catastrophic scenarios where the world switches to SDRs or goes to a gold scenario, but at least for the time being, the U.S. would like to maintain a dollar standard. Meanwhile, China feels extremely vulnerable to the dollar. If we devalue the dollar, that’s an enormous loss to them.

    China has recently sold a portion of its dollar reserves to prop up its own currency, which has come under tremendous pressure. But it still holds a large store of dollar reserves.

    If China has all paper and no gold, and we inflate the paper, they lose. But if they have a mix of paper and gold, and we inflate the paper, they’ll make it up on the gold. So they have to get to that hedged position.

    China has been saying, in effect, “We’re not comfortable holding all these dollars unless we can have gold. But if we are transparent about the gold acquisition, the price will go up too quickly. So we need the western powers to keep the lid on the price and help us get the gold, until we reach a hedged position. At that point, maybe we’ll still have a stable dollar.”

    The point is that is that there is so much instability in the system with derivatives and leverage that we’re not going to get from here to there. We’re not going to have a happy ending. The system’s going to collapse before we get from here to there. At that point, it’s going to be a mad scramble to get gold.

    The price of gold will go significantly higher in the years ahead. But contrary to what you read elsewhere, gold won’t go higher because China is confronting the U.S. or launching a gold-backed currency.

    It will go higher when all central banks, China’s and the U.S.’ included, confront the next global liquidity crisis, worse than the one in 2008, and individual citizens stampede into gold to preserve wealth in a world that has lost confidence in all central banks.

    When that happens, physical gold may not be available at all. The time to build your personal gold reserve is now.

    We need to mention Russia here too. Russia is also amassing gold. And since Russia and China aspire to be true gold powers, it’s not enough to have physical gold. It’s also critical to create gold exchanges and gold markets for price discovery and trading.

    Currently the price of gold is set in two places. One is the London spot market, controlled by six big banks including Goldman Sachs and JPMorgan. The other is the New York gold futures market controlled by COMEX, which is governed by its big clearing members, also including major western banks.

    In effect, the big western banks have a monopoly on gold prices even if they do not have a monopoly on physical gold. But that could be about to change.

    Russia and China are not only building up physical reserves and exploring for more, they are building trading systems that allow for price discovery and leveraged trading in gold.

    It may take a year or so to attract liquidity, but once these new exchanges are fully functional, the physical gold market will regain the upper hand as a price maker.

    Then gold will commence its march to monetary status, and its implied non-deflationary price of $10,000 per ounce.

    The time to buy is now, before that happens.

  • Fed Fail? Traders Cut Rate-Hike Bets By The Most In History Last Week

    The last two weeks have seen speculators cover over $710 billion worth of Fed rate-hike bets – the biggest move in Eurodollar futures history as Trump concerns and Fed Minutes reignite lost faith in the ebullient future that sparked the creation of a record $3 trillion bet that The Fed will be right this time.

     

    Macro data has done nothing but collapse since The Fed hiked rates in March…

     

    And perhaps traders are starting to realize this is anything but 'transitory' as they covered a net 711,000 Eurodollar futures in the last two weeks – the most ever…

     

    And while Specs covered ED shorts, they also added to Treasury longs – pushing the aggregate Treasury complex net speculative position to its longest since August 2014 (which ended with the 30Y yield crashing from over 3.00% to below 2.25% in 3 months)

     

    They added 122K contracts in TY taking their net longs to 363K contracts, the highest since 2007 and turned net long by 47K contracts in US, buying 54K contracts.

    They also pared net shorts in FV by 46K contracts and increased net longs in TN by 22K contracts. However, they sold 43K contracts in TU futures over the week.

    Additionally, according to BofA, the buy-side is positioning for a June hike but with fewer follow-up hikes – they sold record 2-yr treasury, bought the most 30-yr since Oct. 2014.

    Away from bond-land, the buy-side bought the most WTI Crude and Gold futures since late February. Net positon in commodities was not stretched.

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Today’s News 27th May 2017

  • Medal Of Honor Recipient Warns: "It's Going To Come Here… Trump Must Release The Gates Of Hell" On Islamic State

    Authored by Mac Slavo via SHTFplan.com,

    With British Prime Minister Theresa May warning that another attack may be imminent, Medal of Honor Recipient Dakota Meyer says that it’s time to strike Islamic State strongholds without mercy, because sooner or later we could well witness suicide bombers detonating themselves in the middle of large crowds right here at home.

    Arguing that President Obama, who awarded Meyer his Medal of Honor, was weak on ISIS and terrorism in general, he says President Trump should take a completely different strategy.

    In short… it’s time to unleash the gates of hell…

    I’ve been saying this is going to happen for a long time.

     

    When is it coming here?

     

    I think the only way you get this point across is that we release the gates of hell on them and we start making war so ugly that…their recruitment videos… it won’t be cool to join ISIS anymore.

     

    And at some point we’re going to have to do that… this labeling of ‘it’s a lone wolf’ attack… or saying it’s not connected or this or that…

     

    You can’t just ignore this problem because it’s going to come here…

     

    The only thing I am optimistic about with this situation is that we have a President… think whatever you want about his politics…

     

    At least we have a president that’s in place that’s not going to allow us to be the victims… you can guarantee he’s going to do whatever it’s going to take… no matter if it’s popular in the court of public opinion… he’s going to do what’s right to protect America…

    //video.insider.foxnews.com/v/embed.js?id=5446288963001&w=560&h=316

    Watch the latest video at video.foxnews.com

    Our guess?

    President Trump was just warming up when he dropped this mother of all bombs on an ISIS complex in Afghanistan earlier this year:

  • The Most Popular Books In History All Shared One Trait

    Throughout history, people have turned to works of literature for guidance, entertainment, and education. Modern businesses aim to tell stories that leave a long-lasting impact as well, and should look to examples of historical success to influence how they create their own content.

    Today’s infographic comes to us from Global English Editing, and it looks at 20 of the most popular books in the world. As Visual Capitalist's Jeff Desjardins notes, all of the books listed, even those published decades or centuries ago, have made an enduring impact on readers to this day. They have achieved this by stirring discussion and sparking debate wherever they are read.

    Courtesy of: Visual Capitalist

    CONTROVERSY: THE EVERGREEN THEME

    One of the important traits shared by every book on this list is the controversy that has swirled around each of them. This can be seen across different time periods and genres.

    People have questioned the identity and authorial authenticity of Homer and decried the upending of creationism proposed by Darwin. Even a children’s book like the modern bestselling series, Harry Potter, can be a magnet for discussion over what is morally right and wrong.

    It is often the case the that most popular and enduring literary works will not only captivate, but also address controversial issues in such a way that people will be talking about them for generations.

    LESSONS FROM HISTORY

    The recent bestselling streak of George Orwell’s 1984, first published in 1950, is an interesting illustration of this trend.

    The dystopian novel was banned upon its translation and release in the former USSR due to its implicit critique of Stalinist political ideology. By contrast, in the 1970s and 1980s, several American counties challenged 1984 on the grounds that it might promote communist ideals. In the 21st century, Orwell’s best-known work has been revisited by a new generation of readers as the American political climate continues to create new uncertainties about governance, the distortion of facts, and social control.

    FOR BUSINESS CONTENT, BOLD WILL HOLD

    The most popular books ever written can teach modern businesses a great deal about what it takes to make content that is evergreen, meaningful, and primed to engage their readers. Creating discussion is key in the age of the reactive “hot take” style of article. Your ability to stand out in the cultural, historical, or political context for having a point of view that many people find worthy of debating will give your work the staying power it needs.

    Considering that within any given minute there are 2.4 million Google searches taking place and over 700,000 people logging into Facebook, this is no easy task. But whether it’s through a new product or via customer engagement, creating meaningful discussion is key to making a business’ voice heard through all the noise.

  • OANN Releases Report On Seth Rich Murder, Raises Questions About Chinese Corruption

    Via Disobedient Media

    The San Diego based One American News Network has released a new report highlighting key elements of the mystery surrounding the murder of DNC staffer Seth Rich. OANN cites a number of inconsistencies and lingering questions in the case, while also noting that Rich’s murder occurred in close proximity to the similarly strange death of UN official John Ashe. Ashe was found dead just days before he was set to testify against Clinton in relation to matters pertaining to a corruption case where Chinese billionaire Charlie Trie helped launder $1.2 million dollars as part of Chinese government efforts to influence Bill Clinton’s 1996 presidential election. Ashe’s death was originally reported as a heart attack, but the story changed after it emerged that the cause was in fact a crushed windpipe in what was labeled a “workout accident.” The full report can be viewed here:

    On May 25th, one day before OANN’s report, a representative of the media company made a post on the online messageboard 4chan appealing for help locating information regarding the doctor who treated Seth Rich for gunshot injuries he sustained during the incident. Within minutes of the post, OANN’s website was taken offline in a Distributed Denial of Service (DDOS) attack.

    Screenshot taken on 5/26/2017 showing that OANN’s website was taken offline

    The findings of the report offer fresh insights what is appearing to be a story of complex political corruption and Democratic National Committee (DNC) attempts to downplay the scandal. Disobedient Media has previously reported on the extensive ties that key players in the Seth Rich case have to the DNC, the Service Employees International Union (SEIU) and the Rose Law Firm, the law firm which was at the center of the 1990’s Whitewater Controversy.

  • Why Bother?

    Authored by Robert Gore via Straight Line Logic blog,

    The best strategy for dealing with crazies is to keep your distance.

    You try to ignore the ravings of the paranoid lunatic on a street corner, but if he’s waving a gun, you can’t.  He may kill himself, but he may kill you. Protecting yourself is your first consideration. You want to get as far as possible from him.

    As an intellectual exercise, imagine how the Chinese and Russian leadership look at the United States, its government, and those of its allies. It will get you labeled as a “sympathizer” or “agent,” but take the risk and try seeing the world through their eyes:

    We hear the Americans raving about the exceptional and indispensable nation, the American imperium, and maintaining world order. What other conclusion can be drawn: like many lunatics, the US suffers from delusions of grandeur. As we know, it’s difficult to maintain order in one country, and the US wants to take on the whole world? They’re having a tough time maintaining order in the US. Half the country hates the other half, and many of their experts warn of civil unrest that could be ignited with the smallest of sparks. Take it from us, spark suppression is a full-time job in big countries with many people and few common interests, even those with powerful, intrusive governments like the US.

     

    How can the US think that it can rule the world when it can’t win wars in Vietnam, Afghanistan, and Iraq? That’s crazy talk! There are smart people in their military. They must recognize that guerrilla warfare, terrorism, knowledge of the people, language, and terrain, and the availability of cheap but effective defensive weapons and munitions give a huge advantage to nationals resisting domination in their own territory. Why hasn’t the US learned anything from their disastrous wars, or the Soviet fiasco in Afghanistan?

     

    We in Russia are not altogether comfortable with our Syrian involvement and know it poses substantial risks. However, Syria is in the same neighborhood, is a long-time Russian ally, and hosts Russia’s only Mediterranean port. The US has no such compelling interests and is apparently there at the behest of Saudi Arabia, the Gulf States, Turkey, and Israel. (How do these nations get the US to fight its wars? It must be baksheesh.) It pretends to fight Islamic terrorists while aiding them in another idiotic, and so far futile, attempt at regime change. The biggest danger for us in Syria isn’t the rebels, it’s those crazy Yanks.

     

    The US and its allies’ (what curious allies—the US defends them and picks up most of the tab while they fund cradle-to-grave welfare states) interventions have created refugees—some innocent victims, some potential terrorists—who have fled en masse to Europe and trickled into the US. More intervention will create more refugees, yet that is their policy. Russia and China both have problems with native Muslim populations; it’s pure lunacy to import them. Yet, the American and European intelligentsia condemn not the proponents but the detractors of military intervention and refugee creation and admittance.

     

    If those are supposed to be the smart people, it’s no wonder those countries are in such poor shape. A country is only as good as its people. The Americans and Europeans have voted themselves benefits from their governments that can only be paid for with debt. How long can that last? What will beneficiaries do when the well runs dry? The US used to be one of the most industrious countries on the planet. Now most of its people are fat, lazy, and soft, with no idea how to provide for themselves. The so-called smart people worry if transgenders can enter the bathroom of their choice, and cheer a great Olympic decathlon champion who turned himself into an approximation of a woman. These idiots are not useful to anybody.

     

    The only rational policy is to keep our distance from the US, while trying to protect ourselves from its depredations, and concentrate on jointly developing the immense potential of Eurasia. In other words, to continue doing what we’ve been doing. Our primary economic initiatives, One Belt One Road and the Maritime Silk Road, under the auspices of the Eurasian Economic Union, are going well. We will develop extensive commercial and transportation links among nations stretching from China to Europe, an area which encompasses over half the world’s population and natural resources. China will providing much of the infrastructure investment through the Asian Infrastructure Investment Bank. Russia will spearhead security arrangements, particularly against Islamic extremists, through the Shanghai Cooperation Organization, which includes China and central Asian nations that were formerly part of the USSR, and will soon admit India, Pakistan, and Iran.

     

    Financially, self-protection means moving away from fiat dollars and euros and stockpiling real money—gold. China is reducing its vast pile of US treasury securities, and Russia its much smaller pile. We will continue to advocate for replacement of the dollar as the world’s reserve currency, preferably with the International Monetary Fund’s Special Drawing Rights. The Chinese yuan recently became part of that currency basket. We have also taken steps to develop an alternative to the SWIFT system, the US’s monopoly on international bank clearing.

     

    Militarily, some of the bluster coming out of the US is insanity: the possibility of “winning” a nuclear war. No matter what their computer simulations might suggest, there is no way that a US first strike would wipe out our means and will to retaliate, regardless of their anti-ballistic missile systems in Eastern Europe and South Korea. Sometimes it is an advantage to be underestimated by one’s enemy, but in this case, US underestimation could lead to extinction of the human race. Our nuclear weaponry, military strategies, and defense systems must continue to be state of the art, to assure that destruction in the event of a US attack is mutual.

     

    Keeping our distance from the US certainly does not entail getting involved in their elections. Donald Trump didn’t have a positive thing to say about China during his campaign. Although he made noises about reducing America’s foreign interventions, we heard the same from George W. Bush and Barack Obama and look how that turned out. Trump also made noises about rapprochement with Russia, but it was clear that he’d be fighting his own Deep State if he won, which we did not expect. Why would we poison relations with Hillary Clinton, who we and most experts did expect to win, before she even took office? It’s a further sign of rampant delusion, a complete unwillingness to deal with reality, that Clinton’s Democrats are blaming Russia for problems they brought upon themselves.

    Why bother manipulating an election when America seems so bent on self-destruction? It would be like trying to leash a rabid dog.

     

  • Pelosi Concerned POTUS' Trip Wasn't Alphabetized: "I Mean, Saudi Arabia. It Wasn't Even Alphabetical"

    Over the years, Nancy Pelosi has garnered somewhat of a reputation for saying things that don’t seem to make a whole lot of sense.  As most will recall, the pinnacle of her illogical ramblings seemingly came in March 2010 when she argued that voters would only be allowed to read the details of the Obamacare legislation after it had been passed. 

    For those who somehow managed to miss it…here you go:

     

    Oddly, comments like the one above seem to have had absolutely no impact on San Franciscans who continue to re-elect her to public office year after year.  And while we find that somewhat disturbing, it at least affords us all the opportunity to enjoy an endless supply of gaffes from Pelosi’s very active public speaking schedule.

    In fact, the latest gift from San Francisco to the world came yesterday when Nancy held her weekly press briefing and was caught completely off-guard by a journalist who asked for her thoughts on Trump’s first international trip.  While this would seem like a ‘softball question’ designed specifically for Nancy to knock out of the park, she proceeded instead to have yet another on-air nervous breakdown that ended with her questioning why Trump’s first foreign stops weren’t organized in alphabetical order.

    “I thought it was unusual for the President of the United States to go to Saudi Arabia first. Saudi Arabia!”

     

    “It wasn’t even alphabetical. I mean, Saudi Arabia.”

     

    She goes on to point out that 4 of the 5 previous presidents all visited Canada for their first foreign trip which she seemed to find more appropriate given its rank in the alphabetical list of foreign countries.  Of course, it does beg the question of why Obama didn’t visit Afghanistan first…hmmm, quite suspicious indeed.

  • On Gold, Dollars, & Bitcoin

    Authored by Paul Brodsky via Macro-Allocation.com,

    We have been bullish on gold – the barbarous relic; King Dollar – the modern hegemon; and Bitcoin – the crypto currency investors love to hate. One might say our feet have been planted firmly in the past, present and future. (We may not have three feet, but let’s go with it.) Are we hedging our bets, being too cute by half, or is there a cogent rationale that unifies bullishness for money forms most would consider incongruous and at-odds with each other?

    The short answer is we like:

    1) gold, because central banks around the world own it and are buying more, ostensibly to devalue their fiat currencies against it someday, after they are forced to hyper-inflate in order to reduce the burden of systemic debt service and repayment;

     

    2) the dollar, because dollar-denominated financial markets are broader and deeper than any other market and because the Fed is years ahead of other major central banks when it comes to normalizing policy and maintaining bank solvency (i.e., other fiats are in worse shape), and;

     

    3) Bitcoin, the borderless digital currency that is already being perceived as a better store of value than gold and all fiat currencies, and potentially a more expedient means of exchange too. All three should win in different ways.

    It may be easier to accept this discussion by first reminding one’s self that monetary regimes come and go every fifty years or so. The last transition was in 1971 and the world is due for another. We have a high level of conviction that the evanescence of the current global monetary system is rooted in sound economics and already has been firmly established. A global monetary reset is necessary and likely.

    To understand why we must break down money into its two main components: a means of exchange and a store of value. When it comes to using money in exchange for goods and services, fiat currencies have it all over gold and crypto currencies presently. That’s because governments demand taxes be paid with their fiat currencies (legal tender), forcing producers and labor to demand compensation in those currencies. As a result, banking, payment systems and all goods and service channels are set up to use fiat-sponsored currencies.

    When it comes to a store of value, however, the factors of production may choose to save in whatever form of money they want. If the general perception is that government-sponsored, bank system-created fiat currencies will have to be greatly diluted in the future so that systemic debts can be serviced and repaid, then savers will migrate to money forms with capped floats, like gold and Bitcoin.

    Prior to 1971, if a major government-sponsored currency was threatened with dilution, global sovereigns and savers and producers would exchange that currency for gold at a fixed exchange rate to the dollar. Or, they could simply exchange that currency for another currency less likely to be diluted. In the current regime, all economies are highly levered and all fiat currencies must be greatly diluted in the future. It comes down to timing and we think the US dollar is the best positioned of all major fiat currencies. That said, it will eventually have to be diluted too and will lose value in gold and Bitcoin terms.

    As mentioned above, gold is still owned by the world’s major treasury ministries and central banks. (In fact, it is effectively the only asset on the Fed’s balance sheet that is not someone else’s liability.) If US or global economic growth were to fall enough, or contract, and central bank monetary and credit policies were to fail to stimulate positive growth, then the value of all outstanding sovereign, household and corporate debt (and bank and bondholder assets) would become stressed.

    The Fed would have no choice but to devalue dollars against its other asset – gold. Other central banks would either follow suit or go along with a coordinated plan to fix their currencies to the dollar (i.e., a new Bretton-Woods agreement). If this were to happen the price of gold in dollar terms would rise by as much as five to ten times current levels, in our view. (We arrive at this magnitude of change by taking the level of bank assets needed to be reserved and then using the Bretton Woods formula for currency valuation, base money divided by gold holdings.)

    The new gold price would reflect a level at which gold holders would be willing to exchange their gold for the diluting currency. This dynamic is basically what happened in another form with US interest rates in 1980/1981. US treasury yields were forced higher by the Fed (22 percent to 15 percent along the inverted yield curve), a level at which trade partners like OPEC would accept dollars with a floating exchange rate.

    Finally, Bitcoin. The BTC/USD exchange rate has gotten a lot of notice lately because it has almost doubled in the last month (se chart below)…

    To listen to financial media commentary, the extraordinary move must be the result of unsophisticated financial rubes looking to get rich quick on the latest tulip fad.

    We disagree. While the dollar price of BTC may drop significantly any time as it reflects people’s understanding of dynamic global economic and monetary conditions and of Bitcoin itself, we are highly confident the exchange rate will appreciate dramatically from current levels over time.

    To be sure, faith in the flexible exchange rate fiat monetary system remains strong in G7 economies and those that actively trade with them. But major currencies require continued faith in perpetual growth without recessions and that highly leveraged, irreconcilable balance sheets will never have to be diluted.

    Meanwhile, access to Bitcoin takes only internet connectivity, it is free to store, and there is no need to hide it traveling across borders. Bitcoin, itself or as a proxy for all crypto currencies, is quickly becoming a more reliable and accessible store of value for 5 billion people across the world residing in economies without major currencies, strong central banks or stable pegs.

    The store-of-value benefit is beginning to make itself clear to wealth holders in developed economies too, those becoming aware of the need for future fiat currency inflation by monetary authorities.

    Those unfamiliar with crypto currencies tend to fear bubble bursting outcomes. While this fear is understandable given its newness, complexity, past volatile market action and lack of a central or sovereign regulator, it is not reality-based. Bitcoin cannot be successfully hacked due to its underlying block chain recordkeeping system, which documents every transaction and every sequential custodian in the chain (all anonymously to the world). No one can create Bitcoins outside its system or sell Bitcoins that do not exist.

    Further, Bitcoin’s float cannot be diluted without the express agreement of 51 percent of all Bitcoin holders. Bitcoins are widely dispersed across the world and there is no central authority with a political agenda. It is inconceivable why Bitcoin holders would agree to being diluted anytime soon.

    At a $50 billion total market valuation, of which Bitcoin is about $30 billion, crypto currencies have almost incalculable appreciation potential vis-à-vis fiat currencies. They should gain significant market share for store of value purposes, and this could be sped up if payment systems adopt Bitcoin, Ethereum, Litecoin, or another crypto currency as a global means of exchange. After all, global fiat money amounts to nearly $100 trillion.

    Many of us who have toiled over the years as professional investors are deluded with the explicit or subconscious expectation that the perception of wealth and markets will someday revert to what they were five, ten or twenty years ago. They will not, in our view. Yes, this time IS different (as it always has been). Our money will change (as it always has).

    Given the highly leveraged state of the current monetary regime, the most dominant variable for future wealth maintenance and creation, in our view, may not be asset selection but rather money selection. Something to think about…

  • Connecticut Credit Risk Soars To Record High As Tax Receipts Tumble

    Connecticut’s general-obligation bonds are riskier than ever as plummeting income-tax collections and a $2.3 billion budget deficit moved all three credit rating companies to downgrade its debt.

     

    As Bloomberg details, tax receipts for the current fiscal year ending in June will be about $451 million short of estimates from January, prompting Governor Dannel Malloy to empty the state’s already small budget stabilization fund. To help close the gap, public employees agreed to accept a 3-year wage freeze and to contribute more for their pension and health-care benefits under a tentative deal that would save more than $1.5 billion over the next two years.

    As we previously detailed, The state of Connecticut has been hit hard by the double whammy of a deteriorating local economy, coupled with a plunge in hedge fund profits – as well as hedge fund managers permanently relocating to Florida – leading to a collapse in tax revenues. According to the the latest Connecticut budget released last week, the state is reeling from the consequences of sliding tax revenue from the super-rich, i.e. the state's hedge fund managers. The latest figures showed that tax revenue from the state’s top 100 highest-paying taxpayers declined 45% from 2015 to 2016. The drop adds up to a $200 million revenue loss for Connecticut.

    In a dramatic, if of questionable credibility, soundbite Department of Revenue Services Commissioner Kevin Sullivan says these wealthy people are “dramatically less wealthy than they were before.” He was referring to annual income, not actual asset holdings, because judging by the all time high in the S&P, the local financial elite have never had a higher net worth.

    “When you look at the top 75, top 50 … this is a group of wealthy people who are dramatically less wealthy than they were before,” said Kevin Sullivan, commissioner of the Connecticut Department of Revenue Services. “These folks, for a number of reasons, are either not realizing as much income or don’t have as much income.”

    Just don't expect tears from the general public. Sullivan also noted how several international hedge funds have recently failed, resulting in “significant retrenchment” from investors. That drop in tolerance for risk brings smaller margins and ultimately less personal income for the state to tax, he added. It's fascinating how the Fed's central planning, superficially meant to restore "confidence" in a rigged, manipulated market is having such proound and adverse 2nd and 3rd order effects on state budgets.

    Sullivan also acknowledged part of revenue decline can also be attributed to “a handful” of wealthy individuals who moved to more tax-friendly states — an issue frequently raised by legislative Republicans, who argue Connecticut’s tax policies encourage the state’s super-rich to move out.

    None of this should be a surprise… it's no wonder more people than ever are looking to leave the increasing tax burden of this troubled state?

  • Shari'ah-Compliant Crypto Gold: Could Islam Be Preparing For A New World Reserve Currency?

    Authored by Shannara Johnson via HardAssetAlliance.com,

    It all started pretty harmlessly: in December 2016, after about 12 months of deliberations, the Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) and the World Gold Council announced a new “Shari’ah Standard on Gold.”

    The new standard was celebrated as a potentially big boost for global gold demand as it would give more than 2 billion Muslims in the world access to gold-based financial products that were previously forbidden to them.

    That included vaulted gold, gold accumulation plans, gold certificates, gold-backed ETFs like GLD, and gold mining stocks.

    Under Shari’ah law, physical gold was considered a “ribawi item,” which means it could only be used as a currency and worn as jewelry, but it couldn’t be traded for speculation or future value. However, Muslim investors were well aware that the $1.8 trillion Islamic finance business was missing out on important opportunities.

    Under the new standard, Shari’ah-compliance is guaranteed as long as physical gold is the underlying asset.

    And we didn’t have long to wait for a brand-new financial product coming from the Islamic world that combines the popularity of Bitcoin with the timeless value of physical gold: OneGram, a gold-backed, fully Shari’ah-compliant crypto currency.

    The new currency was announced on May 4 at the Ritz Carlton, Dubai International Financial Center—with the official ICO (Initial Coin Offering) following only 17 days later.

    “In recent years, the Middle East has seen incredible growth in fintech innovations including digital tokens and smart contracts,” said Ibrahim Mohammed, the founder and CEO of OneGram, in his first press release. “With OneGram, we’re excited to provide an opportunity for investors who care about Islamic financial markets and the security of commodity-backed investments to benefit from rapid technological advances in the blockchain industry.”

    According to OneGram’s website, initially each OneGram coin (OGC) is backed by one gram of gold and can be used for digital payments, just like Bitcoin.

    The total number of OGCs is fixed and won’t change after the ICO. The digital transaction fees (minus admin costs) will be reinvested to buy more gold.

    “Therefore,” states the website, “the amount of gold backing each OGC will increase with time.”

    Plus, of course, a rising gold price and the growing acceptance of OneGram in the market are also poised to pump up its value.

    Gold and crypto-currency experts are already speculating about the implications of the launch. A recent CoinDesk review stated:

    Bitcoin is often referred to as a “good” money because of its limited supply, relative fungibility and ease of exchange. If gold can also start to satisfy those requirements, a seismic shift from fiat to digital could be easier to “sell”—the public is predisposed to trust gold, certainly more so than cryptography.

    It could also open the door to the creation of a new global currency as an alternative to the dollar, something that Russia and China are rumored to be looking at.

    [Emphasis mine.]

    We sure do live in interesting times – and it is not all that far-fetched to think that OneGram, or another gold-backed crypto currency like it, could be a stealthy way to introduce a new global gold standard.

  • WaPo Reports Kushner Sought "Secret" Back-Channel With Moscow, Admits It's Normal Practice

    Looks like we spoke too soon. The holiday-weekend Trump bombshell has arrived courtesy of The Washington Post. This time, the paper is reporting that Jared Kushner, the president’s son-in-law and one of his closest advisors, discussed the possibility of setting up a secure communications channel between the Trump transition team and the Kremlin with Russian Ambassador Sergei Kislyak.

    The scene was set earlier in the week when NBC reported on Thursday that Kushner is now “under FBI scrutiny” before explaining that he’s not an official target in the investigation.

    And now, WaPo reports, according to the anonymous US officials, sensitive information 'incriminating Kushner' was intercepted by US intelligence agencies when Kislyak relayed the details of the discussion to his superiors in Moscow.

    At first brush, the report appears damning: If accurate, WaPo has unearthed actual evidence of collusion between a senior Trump associated and the Russians, one might think.

    But it’s important to keep in mind two crucial facts that WaPo decided to bury further in their "reporting."

    First, this alleged discussion occurred during a meeting at Trump Tower in early December, nearly a month after Trump’s upset victory over Hillary Clinton.  The investigations being led by Special Counsel Robert Mueller, the House and the Senate are focused on uncovering evidence of collusion between Trump associates and the Russian government during the campaign.

     

    And second, if it weren’t for the implications (that this is evidence of collusion between a close Trump associated and Moscow), this would be a non-story, as WaPo readily admits, 16 paragraphs deep: It is common for senior advisers of a newly elected president to be in contact with foreign leaders and officials. But new administrations are generally cautious in their handling of interactions with Moscow, which U.S. intelligence agencies have accused of waging an unprecedented campaign to interfere in last year’s presidential race and help elect Trump.”

    So, to summarize – after Trump won the election (thus not before the election and not showing any election-tampering collusion), Kushner began discussions with the US representative of another world super-power to set up the back-channel-communications that are standard when any new president is elected.

    If that's the best the media has for a long weekend, then perhaps, just perhaps, we have jumped the shark in terms of 'damning' leaked intercepts? Or perhaps the assumption is that the average WaPo reader will not reach the 16th paragraph, merely content with the headline confirmation of their own bias?

    In a separate story published Friday evening, Wapo reported that the Senate Intelligence Committee has asked President Trump’s political organization to gather and produce all documents, emails and phone records going back to his campaign’s launch in June 2015. The development is notable because it's the first time that any Congressional investigators have requested documents from the Trump campaign.

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Today’s News 26th May 2017

  • A New Financial System Is Being Born

    Authored by Mike Krieger via Liberty Blitzkrieg blog,

    If Bitcoin blew you away when you first discovered it, and continues to do so to this day, Spiral Dynamics can help explain why. Bitcoin was an expression in the physical world of the newly emergent leading-edge integral level consciousness. It drew lessons from history and attempted to take the best of orange and green worldviews and incorporate them into an entirely new form of money. We see the clear presence of free markets and individualism, as well as the intentional separation of the system from dominator hierarchies (bureaucratic government meddling), which had corrupted all money before it. Its greenness is evident in the fact that by design no individual or company controls the network. Global, decentralized, revolutionary technology. This is perhaps the perfect example of integral consciousness operating on our planet at this time from an economics standpoint, and why it has captured the imagination of so many, while at the same time being violently rejected by so many others.

     

    From February’s post: Why Increased Consciousness is the Only Path Forward

    Although I had heard about it much earlier, I didn’t truly start investigating Bitcoin until the summer of 2012. The more I learned the more my mind was blown away, and for a while I couldn’t think about anything else. What truly solidified its real world usefulness to me was when I discovered it had been used by Wikileaks to accept payments in the midst of a financial services blockade against the renegade publisher. This realization inspired my first Bitcoin related post in August 2012 titled, Bitcoin: A Way to Fight Back Against the Financial Terrorists? 

    In that piece, I linked to a Forbes article that detailed the revolutionary events taking place. We learned:

    Following a massive release of secret U.S. diplomatic cables in November 2010, donations to WikiLeaks were blocked by Bank of America, VISA, MasterCard, PayPal and Western Union on December 7th, 2010. Although private companies certainly have a right to select which transactions to process or not, the political environment produced less than a fair and objective decision. It was coordinated pressure exerted in a politicized climate by the U.S. government and it won’t be the last time that we see this type of pressure.

     

    Fortunately, there is way around this and other financial blockades with a global payment method immune to political pressure and monetary censorship.

     

    On its public bitcoin address, Wikileaks has taken in over $32,000 equivalent in more than 1,100 separate bitcoin donations throughout the blockade (1BTC = $10.00). But these amounts may be significantly higher, because it does not even include the individually-generated bitcoin addresses that WikiLeaks provides for donors upon request.

    I knew right then and there that Bitcoin had the potential to change the world. My passion for Bitcoin was always framed by my ten years working in the financial industry. Many of us who lived through the 2008 crisis knew the financial system was dead. We knew it was corrupt, archaic and terminal, so many of us began bracing for what might come next. We did what we thought made sense at the time, which included buying precious metals like gold and silver given their historic track record of protecting wealth in periods of paradigm-shifting financial disruption. Others took more extreme measures to protect themselves from the end of the financial system, but a small group forward thinking geeks decided to do something much better. They decided to build an alternative.

    Thus, Bitcoin was born and early adopters in the field of technology immediately began to build on top of it. As soon as I realized what was happening much of the “doom and gloom” that had enveloped my thinking began to lift. I now knew that even if the financial system crashed and burned tomorrow, the early stages of a new and far more honest financial system were already in place. The emergence of Bitcoin literally changed my life for the better as it allowed me to emerge from a cave of gloom and become optimistic about our long-term future. While I knew the path would be long and hard since the current entrenched interests wouldn’t give up without a fight, I could see a very bright light at the end of the tunnel, and the continued development in this space has been extraordinary to watch ever since.

    The global financial system as it stands completely archaic and corrupt. It enriches the wrong types of people for the wrong sort of behavior, and is entirely extractive and parasitic by design.  If there’s sector in the economy that needs a total redesign and reboot for the sake of humanity, it’s the financial system.

    Being involved in the crypto world for the past five years has been a breath of fresh air and a shot of adrenaline to my system. Traditional markets are a rigged snooze-fest by comparison, grotesque financial Potemkin villages designed to make overly indebted, predatory economies look good. What I find so fascinating about the current environment is that many of the dreams we all read about in the very early days of Bitcoin are starting to be implemented and designed, slowly but surely. For those of you who still have a difficult time conceptualizing exactly what’s happening in the space, I think the following tweet may help.

    //platform.twitter.com/widgets.js

    On that note, I want to talk about more than just Bitcoin, which I see as the reserve currency of the crypto world. Beyond Bitcoin, a lot of the buzz in the space right now revolves around a burgeoning phenomenon known as ICOs, or Initial Coin Offerings. So what are ICOs?

    Yesterday, TechCrunch published an interesting piece on the topic. Here are a few keys points:  

    Because this editor was still confused (I’m not proud), I talked yesterday with Stan Miroshnik, a UC Berkeley grad with an MBA from MIT who today runs L.A.-based Argon Group, one of the first digital finance-focused investment banks. Miroshnik nicely answered an array of questions about ICOs, including how these things get staged, how companies establish a value for their offerings, and more. If you’re still trying to get a handle of this latest investing trend, too, read on.

     

    TC: ICOs are everywhere suddenly.  When was the first ICO staged?

     

    SM:  You have to go back to around 2013, when Mastercoin, a protocol on top the bitcoin blockchain, raised $500,000. Then you had a number of other milestone token sales, such as Ethereum in 2014, then the DAO, or Decentralized Autonomous Organization, which was built on the Ethereum blockchain and that stored and transmitted Ether and Ethereum-based assets and that raised the equivalent of $150 million last year.

     

    Momentum began to build after that, as a smaller group of [these offerings] grew in size, and by last fall, some companies were raising millions of dollars in minutes. That really kind of made people stand up and wonder if this is a new funding mechanism.

    TC: How many ICOs have there been to date?

     

    SM: There were 64 last year that collectively raised $103 million, excluding the DAO. So far this year, we’ve seen 25 offerings raise a bit more than $163 million, and we’re on track to see more than $210 million raised by the end of June.

     

    TC: So how do these ICOs work, practically speaking?

     

    SM: There’s a cadence to these things. You do the prep-work and get your project to a natural technical milestone. Then you pre-announce when you’re planning to have a token sale, describing some of the terms, and telling a story of the project and its goals. You publish a white paper and disclosure and give people a chance to read it and comment. There are also usually threads that develop on Reddit, Bitcointalk, Slack, Telegram and elsewhere, where people actively debate the merits of the product. Then, on the landing page on the aforementioned date, there’s typically a tool that enables purchasers to acquire the tokens in exchange for bitcoin or ether.

     

    TC: Is there a concern that U.S. regulators will crack down on these ICOs?

     

    SM: Lawyers are relying on case law that defines what a security is. The most well-known case is the “Howey Test,” created by the Supreme Court for determining whether certain transactions qualify as investment contracts. If they do, then those transactions are considered securities and are subject to certain disclosure and registration requirements. When tokens are structured basically as the sale of a service or product, they’re designed to make sure the various prongs of the test are not triggered.

     

    TC: What types of companies are primarily using ICOs?

     

    SM: It’s still a financing mechanism that’s very organic to the blockchain community.

     

    It all started with protocols like Ethereum raising funding through this mechanism, and it has stayed close to related projects, like the distributed storage company Storj and Civic, a company that provides identify through the blockchain and is announcing its token sale this Thursday. A lot of these founders and token buyers are part of bitcoin forums and Reddit, and that’s why [certain companies] are able to raise these large sums fairly quickly; they’re reaching out to thought leaders and getting their support and generating buzz about their projects. It’s  basically the open source community, now with an open-source funding mechanism.

     

    TC: What happens when people want to sell the tokens they’ve bought?

     

    SM: Well, first, you can use them in a company’s ecosystem. With Storj, maybe you buy storage. You can also accumulate these tokens over time, as a bet that with more enterprise demand for storage capacity, the coins will become more valuable, after which you can sell your tokens to someone else who needs to purchase storage space.

    There are also a number of cryptocurrency exchanges where these tokens trade. In the case of Storj, you can sell or buy on Poloniex or Bittrex.

     

    TC: Should VCs be nervous about ICOs? You mention Civic, which is staging an ICO. Civic has also raised some venture capital previously. But plenty of other companies seem to be skipping the VC part.

     

    SM: To some degree they should, but we’ve also talked with a lot of very smart VCs who are looking at this space, including August Capital, Tim and Adam Draper, Blockchain Capital. Many are doing the work to understand how to be involved and active in the space and the fundamental value of these protocols. Union Square Ventures has said it now has a mandate from its LPs to hold these assets.

     

    For companies that raise funds through a token sale and that have had traditional angel or venture rounds previously, for example, their equity investors get to skip one or two rounds of dilution, which is great; it means their returns are hyper-levered.

    There are two points I want to emphasize from the above. First, just how early we are in the development of this area. The numbers are absolutely tiny at this point despite all the hype. Recall that in 2017, we’ve seen 25 offerings raise a bit more than $163 million. That’s an infinitesimally small number in the scheme of things, thus room for growth is massive. That being said, people considering getting involved in this space as a buyer of ICOs need to be extraordinarily careful.

    Investing in general is risky and challenging, but putting money into an ICO adds several other layers of complexity and risk. First, as noted above these things are not equity investments since they aren’t allowed to be under current regulations. Therefore, you’re not simply investing in a startup, which is always extremely risky, but you’re making a bet that the token itself is useful and will accrue in value over time. Therefore, not only do you need to be right about the success of the business or product itself, but the token also must have a real value-creating purpose to succeed in the long-run. Many people will not understand this and think they are buying into the equity of the underlying businesses, which sets up a perfect environment for fraudsters. You also need to bear in minds there’s a ton of Bitcoin liquidity that is flooding around the space given the massive run its had. Most early Bitcoin adopters and investors are very passionate and dedicated to this space. They don’t want to sell coin for dollars, but want to put it in new projects to keep the broader ecosystem growing. I think this is a fantastic thing, but it also means there’s a lot of crypto currency sloshing around trying to find a home.

    Despite the risks, I think the emergence of the burgeoning token market is a game-changing and extraordinarily empowering development. The only thing preventing the crypto-coin world from rapidly displacing the middlemen and bureaucrats of the traditional financial system are the barriers around the traditional financial world. While we’d like to think these barriers are there to protect the little people, we all know that the SEC and other such regulatory bodies largely exist to protect the rich and powerful and secure their moat.

    We saw this under Obama’s Mary Jo White, and we will surely see it under Trump’s pick Jay Clayton, who seems to have all sorts of conflicts, including a wife who works at Goldman Sachs. The SEC doesn’t protect the people, but as long as it pretends to, it can continue to function as a gatekeeper for financial oligarchs and slow down the pace of displacement of the dying financial system with the new parallel one currently being created.

    All of that is fine I suppose, and innovation in the crypto world will continue until one day we will actually see equity offerings in startups to regular people as opposed to just allocations to the wealthiest clients of brokerage firms. The innovation in this space has the potential to flatten the world of investing in a meaningful and powerful way, starting today with tokens, but ultimately in many other ways as well. It’s gonna take time, but it’ll happen.

    At this point, I just want to briefly address the common retort that “governments will never let this happen,” which I get all the time. Here’s what I had to say about it yesterday on Twitter, and I don’t really have much to say beyond this.

    To conclude, I’d like to dedicate this post to all the brilliant geeks and the dynamic entrepreneurs pushing hard every day to realize this incredible dream of a decentralized future. A future that breaks down barriers, removes middlemen and empowers humanity to take its next evolutionary leap forward. You are the ones creating this brand new world brimming with potential and optimism, and I want to thank for all you have done and continue to do.

  • Former Navy Seal To Katy Perry: 'Go To Hell… Hold One Of Your Concerts In Syria And See How It Goes'

    Katy Perry, a woman so crazy Russell Brand divorced her over text message, broke down in tears Saturday night at a concert and urged the crowd ‘not to let terrorists win’ in response to the Manchester bombing. Tuesday morning, she went on the radio to tell everyone all we need is open borders, hugs, and love in response to horrific terrorism. Basically this.

    Paul Joseph Watson can bring you fully up to speed:

      

    And today on Fox, former Navy Seal Carl Higbie who was responsible for triggering an entire CNN panel last week, had a few choice words for Ms. Perry – daring her to hold a concert in Syria if she thinks peace and love is all it’ll take to conquer ISIS:

    “We don’t have people who respect the culture of the United States of America. You have people like Katy Perry, for instance. I mean, this woman has said ‘oh we need to give them hugs, hug it out. Go to hell Katy Perry.

     

    “Hold one of your concerts in Syria and see how it goes.”

     

      

     

    What a strange, out of touch woman…

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

  • Greg Gianforte Crushes Opponent in Congressional Run-Off, In Spite of Body Slamming Reporter

    The vapid taste of loss must get repetitive for Democrats in America. In spite of the scandals, the Russians, and John Podesta’s email box being the laughing stock of the entire world, they keep losing. The Republican candidate for Congress, Greg Gianforte, grabbed a reporter from The Guardian, Ben Jacobs, by his neck, body slammed him to the ground, and then pounded on him — Saul Rosenberging his glasses. Yet, on election night, despite the negative press, the good people from Montana voted in droves for Gianforte.

    With 84% of precincts reporting, Gianforte had 172,743 votes — or 50.4% of the vote, compared to Quist who has 150,007 votes, 43.8% of the vote, according to Edison Research.

    It’s embarrassing, really.

    Being the rugged gentlemen that he is, Rep. Gianforte apologized tonight, just before he graciously accepted his win.

    Here’s how the rural folk felt about the whole body-slamming ordeal.

    Via CNN:

    “We whole-heartedly support Greg. We love him,” said Karen Screnar, a Republican voter who had driven all the way from Helena to support Gianforte. Screnar said she and her husband have known Gianforte for the better part of a decade. After Gianforte was charged with misdemeanor assault, Screnar said she was only “more ready to support Greg.”

    “We’ve watched how the press is one-sided. Excuse me, that’s how I feel. (They’re) making him their whipping boy so to speak through this campaign,” Screaner said. “There comes a point where, stop it.”

    Her husband, Terry, chimed in that he believed Gianforte was “set up.”

    The left argues that the GOP is an out of control train-wreck, being led down wayward paths by Trump-Hannity and now Gianforte. Drama aside, even if that was true, what’s more alarming is the fact that people are so sick of establishment politics, they’d rather vote for a man who punches reporters in the face, rather than cordially declining his questions.
    Content originally published at iBankCoin.com

  • Has The Drug War Incentivized Police To Treat Citizens Like Terrorists?

    Authored by Duane Norman via Free Market Shooter blog,

    A video of a Florida Sheriff making a promo video to scare has been making the rounds recently.  Casey Research recently covered the affair, noting the following quote from Sheriff Grinnell:

    “Enjoy looking over your shoulder, constantly wondering if today’s the day we come for you. Enjoy trying to sleep tonight, wondering if tonight’s the night our SWAT team blows your front door off the hinges. We are coming for you.”

    The video (reproduced below, with commentary from Casey Research) is as surreal as the above picture implies…

    Sheriff Grinnell delivered this message last month while flanked by four combat-ready officers wearing ski masks. It looks like someone from ISIS directed it.

     

    Grinnell’s message was aimed at local drug dealers. You see, Lake County has a serious opioid problem. And like many other places in the US, it’s fighting its drug problem as if it were a war.

    …but this is hardly the first time a video like this has been produced, and it likely won’t be the last.  Last year, former Sheriff Clay Higgins, known as the “Cajun John Wayne” in Louisiana, released the below video calling out the “Gremlins” gang, and before his resignation, was known for making many similar videos:

    Some notable quotes from Sheriff Higgins:

    • You won’t walk away.  Look at you. Men like us, son, we do Dumbbell presses with weights bigger than you.
    • Young man, I’ll meet you on solid ground, anytime, anywhere. Light or heavy, it makes no difference to me.
    • You will be hunted, you will be tracked. And if you raise your weapon to a man like me, we’ll return fire with superior fire.
    • You don’t like the things I’ve told you tonight?  I’ve got one thing to say – I’m easy to find.

    This guy certainly has enough one-liners to be worthy of the “Cajun John Wayne” moniker, but it seems none of the police or community leaders behind him bothered to ask why criminals engage in such violent behavior; they are trying to profit from the obscenely high price of illegal drugs.  And when it comes to profit, the criminals are hardly alone.

    Free Market Shooter has covered the problems with Civil Asset Forfeiture in the past…

    Martin Armstrong of Armstrong Economics explains how police have every reason to seize assets, largely because these civil asset forfeitures are literally funding police departments:

     

    Between 1989 and 2010, U.S. attorneys seized an estimated $12.6 billion in asset forfeiture cases. The growth rate during that time averaged +19.4% annually. In 2010 alone, the value of assets seized grew by +52.8% from 2009 and was six times greater than the total for 1989. Then by 2014, that number had ballooned to roughly $4.5 billion for the year, making this 35% of the entire number of assets collected from 1989 to 2010 in a single year. According to the FBI, the total amount of goods stolen by criminals in 2014 burglary offenses suffered an estimated $3.9 billion in property losses. This means that the police are now taking more assets than the criminals.

    …but if you take a closer look at the forfeitures themselves, you’ll realize just how many of them are related to the war on drugs:

    “Thirty-six percent of all local police departments received money, property, or goods from a drug asset forfeiture program during 2002 (table 32). These departments employed 78% of all local police officers. At least 80% of the departments in each population category of 25,000 or more had drug asset forfeiture receipts.”

     

    “There can be few components of law enforcement programmes which actually cost nothing. The asset forfeiture provision of the federal law for crop suppression (relating mainly to cannabis in the State of Kentucky), proved to be such a case, costing the United States Government $13.7 million, but yielding a return of $53 million in 1991, or almost $4 in assets seized for every $1 invested by the Drug Enforcement Administration.”

     

    “The advent of a now common police tactic, called the “reverse sting,” illustrates the shift in priorities from crime control to funding raids. In a reverse sting, an officer attempts to sell drugs to an unsuspecting buyer. The method permits the police to seize the buyer’s cash rather than a seller’s drugs, which have no value to the agency.

     

    “During the past decade, law enforcement agencies increasingly have turned to asset seizures and drug enforcement grants to compensate for budgetary shortfalls, at the expense of other criminal justice goals. We believe the strange shape of the criminal justice system today—the law enforcement agenda that targets assets rather than crime, the 80 percent of seizures that are unaccompanied by any criminal prosecution, the plea bargains that favor drug kingpins and penalize the “mules” without assets to trade, the reverse stings that target drug buyers rather than drug sellers, the overkill in agencies involved even in minor arrests, the massive shift towards federal jurisdiction over local law enforcementis largely the unplanned by-product of this economic incentive structure.”

    So the drug war has created a massive financial incentive for police to seize property from individuals, one that many departments could require to stay afloat.  What do you think happens next?

    As Free Market Shooter has covered previously for Single Dude Travel, raids from SWAT teams have become commonplace, with police becoming better armed by the day:

    Our nation’s policing system has become profit-driven instead of crime-driven, largely due to the failure of the war on drugs, and the fact that cops have been given surplus military hardware from the armed forces at bargain basement prices. SWAT team raids have gone from a few hundred per year in the 1970s to 50,000 annually, largely because they call SWAT in when “Special Weapons And Tactics” aren’t really needed, such as when apprehending a credit card scammer or raiding an organic farm for the filmiest of reasons. When a SWAT team nearly kills a 19-month old baby with a flashbang grenade, in a raid without the suspect present, how are there no charges filed?

    And now that police are all armed to the teeth looking for property to seize, what happens next?  The practice is applied everywhere.  If you look at a report on the “most outlandish SWAT team raids” across the country, you’ll see just how common it is to have a SWAT team called in:

    • Armed agents raid animal shelter in search of baby deer—and kill it.
    • Girl’s home wrongfully raided with flashbangs despite door being open.
    • SWAT team raids DJ’s studio to enforce copyright law.
    • SWAT squad invades private poker game.
    • SWAT team raids man’s home in search of stolen koi fish.
    • Sex toys, condoms and pajamas seized in drug/prostitution SWAT team raid.
    • Peaceful monks arrested in SWAT team action.
    • Feds raid Amish dairy farm—twice—for selling unpasteurized milk.
    • Police unlawfully invade a series of barbershops without warrants.
    • Police forcibly search and detain 19 patrons in gay bar.
    • SWAT team confiscates wood used to make instruments during illegal raid.

    So, how do you stop police from treating civilians like they would treat terrorists?  The best place to start is removing the incentive structure that has been created by the war on drugs, which brings us back to Casey Research’s commentary:

    Illegalizing something does nothing but create a black market and give people a reason to induce other people to get high. I mean, people have been drinking alcohol for about the last 10,000 years. But it didn’t become a real problem until the Eighteenth Amendment and the Volstead Act passed in 1920. At that point, it financed the mafia.

     

    Laws turn simple bad habits into massive and profitable criminal enterprises.

     

    The government learned absolutely nothing from the failure of alcohol prohibition. What they’re doing with drugs makes an occasional, trivial problem into a national catastrophe…

    However, do not expect that to happen anytime soon; again, as Free Market Shooter has covered in the past, new Attorney General Jeff Sessions is adamant about expanding the war on drugs:

    And, in case you weren’t aware, this is the same Jeff Sessions who is on the record as being not only against medicinal marijuana, it is the same Jeff Sessions that has stated that marijuana is only slightly less awful than heroin:

     

         And I am astonished to hear people suggest that we can solve our heroin crisis by legalizing marijuana – so people can trade one life-wrecking dependency for another that’s only slightly less awful.

    Then again… it’s not like the prior ten attorney generals did anything but continue the war on drugs.  Remember what Casey said about “massive profitable criminal enterprises”?

  • Visualizing How The Big 5 Tech Giants Make Their Billions

    Hitting record high after record high, tech companies have displaced traditional blue chip companies like Exxon Mobil and Walmart as the most valuable companies in the world.

    Here are the latest market valuations for those same five companies:

    Together, they are worth $2.9 trillion in market capitalization – and they combined in FY2016 for revenues of $555 billion with a $94 billion bottom line.

    BRINGING HOME THE BACON?

    Despite all being at the top of the stock market food chain, Visual Capitalist's Jeff Desjardins points out that the companies are at very different stages.

    In 2016, Apple experienced its first annual revenue decline since 2001, but the company brought home a profit equal to that of all other four companies combined.

    On the other hand, Amazon is becoming a revenue machine with very little margin, while Facebook generates 5x more profit despite far smaller top line numbers.

    HOW THEY MAKE THEIR BILLIONS

    Each of these companies is pretty unique in how they generate revenue, though there is some overlap:

    • Facebook and Alphabet each make the vast majority of their revenues from advertising (97% and 88%, respectively)
    • Apple makes 63% of their revenue from the iPhone, and another 21% coming from the iPad and Mac lines
    • Amazon makes 90% from its “Product” and “Media” categories, and 9% from AWS
    • Microsoft is diverse: Office (28%), servers (22%), Xbox (11%), Windows (9%), ads (7%), Surface (5%), and other (18%)

    What does that look like?

     

    Courtesy of: Visual Capitalist

    Lastly, for fun, what if we added all these companies’ revenues together, and categorized them by source?

    Note: this isn’t perfect. As an example, Amazon’s fast-growing advertising business gets lumped into their “Other” category.

    Hardware, e-commerce, and and advertising make up 76% of all revenues.

    Meanwhile, software isn’t the cash cow it used to be, but it does help serve as a means to an end for some companies. For example, Android doesn’t generate any revenue directly, but it does allow more users to buy apps in the Play Store and to search Google via their mobile devices. Likewise, Apple bundles in operating systems with each hardware purchase.

  • Paul Craig Roberts On JFK At 100

    Authored by Paul Craig Roberts,

    This Memorial Day, Monday, May 29, 2017, is the 100th birthday of John Fitzgerald Kennedy, the 35th President of the United States.

    JFK was assassinated on November 22, 1963, as he approached the end of his third year in office. Researchers who spent years studying the evidence have concluded that President Kennedy was assassinated by a conspiracy between the CIA, Joint Chiefs of Staff, and Secret Service. (See, for example, JFK and the Unspeakable by James W. Douglass)

    Kennedy entered office as a cold warrior, but he learned from his interaction with the CIA and Joint Chiefs that the military/security complex had an agenda that was self-interested and a danger to humanity. He began working to defuse tensions with the Soviet Union.

    His rejections of plans to invade Cuba, of the Northwoods project, of a preemptive nuclear attack on the Soviet Union, and his intention to withdraw from Vietnam after his reelection, together with some of his speeches signaling a new approach to foreign policy in the nuclear age (see for example), convinced the military/security complex that he was a threat to their interests.

    Cold War conservatives regarded him as naive about the Soviet Threat and a liability to US national security. These were the reasons for his assassination. These views were set in stone when Kennedy announced on June 10, 1963, negotiations with the Soviets toward a nuclear test ban treaty and a halt to US atmospheric nuclear tests.

    The Oswald coverup story never made any sense and was contradicted by all evidence including tourist films of the assassination. President Johnson had ro cover up the assassination, not because he was part of it or because he willfully wanted to deceive the American people, but because to give Americans the true story would have shaken their confidence in their government at a critical time in US-Soviet relations. To make the coverup succeed, Johnson needed the credibility of the Chief Justice of the US Supreme Court, Earl Warren, to chair the commission that covered up the assassination. Warren understood the devastating impact the true story would have on the public and their confidence in the military and national security leadership and on America’s allies.

    As I previously reported, Lance deHaven-Smith in his book, Conspiracy Theory in America, shows that the CIA introduced “conspiracy theory” into the political lexicon as a technique to discredit skepticism of the Warren Commission’s coverup report. He provides the CIA document that describes how the agency used its media friends to control the explanation.

    The term “conspiracy theory” has been used ever since to validate false explanations by discrediting true explanations.

    President Kennedy was also determined to require the Israel Lobby to register as a foreign agent and to block Israel’s acquisition of nuclear weapons. His assassination removed the constraints on Israel’s illegal activities.

    Memorial Day is when Americans honor those in the armed services who died serving the country. JFK fell while serving the causes of peace and nuclear disarmament. In a 1961 address to the United Nations, President Kennedy said:

    “Today, every inhabitant of this planet must contemplate the day when this planet may no longer be habitable. Every man, woman and child lives under a nuclear sword of Damocles, hanging by the slenderest of threads, capable of being cut at any moment by accident or miscalculation or by madness. The weapons of war must be abolished before they abolish us. It is therefore our intention to challenge the Soviet Union, not to an arms race, but to a peace race – to advance together step by step, stage by stage, until general and complete disarmament has been achieved.”

    Kennedy’s address was well received at home and abroad and received a favorable and supportive response from Soviet leader Nikita Khrushchev, but it caused consternation among the warhawks in the Joint Chiefs of Staff. The US led in terms of the number of nuclear warheads and delivery systems, and this lead was the basis for US military plans for a surprise nuclear attack on the Soviet Union. Also, Many believed that nuclear disarmament would remove the obstacle to the Soviet Army overrunning Western Europe. Warhawks considered this a greater threat than nuclear armageddon. Many in high military circles regarded President Kennedy as weakening the US viv-a-vis the Soviet Union.

    The assassination of President Kennedy was an enormous cost to the world. Kennedy and Khrushchev would have followed up their collaboration in defusing the Cuban Missile Crisis by ending the Cold War long before the military/security complex achieved its iron grip on the US government. Israel would have been denied nuclear weapons, and the designation of the Israel Lobby as a foreign agent would have prevented Israel’s strong grip on the US government. In his second term, JFK would have broken the CIA into a thousand pieces, an intention he expressed to his brother, Robert, and the Deep State would have been terminated before it became more powerful than the President.

    But the military/security complex struck first, and pulled off a coup that voided all these promises and terminated American democracy.

    *  *  *

    Finally, in one of the most iconic political speeches of the 20th century, at his 1961 inauguration address, President Kennedy told his fellow Americans to "ask not what your country can do for you, ask what you can do for your country". To mark the 100 year anniversary of his birth on Monday, Statista's Martin Armstrong has taken a look at what Kennedy's country did for him after his untimely death.

    Infographic: What JFK's Country Did For Him | Statista

    You will find more statistics at Statista

  • Pennsylvania Coroner Says Dying Addicts Keep Morgue Full "Most Nights"

    The coroner’s office in Montgomery County, Pennsylvania is literally running out of room for all the bodies that are piling up because of America’s worsening synthetic opioid epidemic, according to Triblive.com.

    As the story notes, heroin isn’t responsible for these deaths; rather, Synthetic opioids like fentanyl, carfentanil and their many analogues are the chief culprit.

    As Triblive reports:

     

    “Lab-created, designer opioids have far outpaced heroin as a killer of addicts, and they've kept the coroner's office full on most nights.

     

    "If this pace continues, I'm not really sure what we're going to do," said Montgomery County, Ohio, coroner Dr. Kent Harshbarger. "We had 13 (bodies) yesterday, and 12 of them were overdoses."

     

    The county’s coroner had to expand his cooler last month because its 36-body capacity wasn’t enough. It now has room for 42 bodies, and the country still occasionally runs out of space.

    “It’s full every night.”

    Harshbarger even ran out of space one day earlier this year, again because of overdoses, and was forced to send some bodies to a local funeral home for storage. He also occasionally rents refrigerated trailers that can be brought in when deaths spike.

    In Allegheny County, health officials, instances of fentanyl-related overdoses surpassed those of heroin for the first time in 2016. Six hundred people overdosed and died in the county last year – most from opioids, said Dr. Karen Hacker, director of the Allegheny County Health Department.

    Having surpassed gun homicides for the first time in 2015, the epidemic of heroin and opioid related deaths in the US continues to grow, amid the dismal failure of the 'war on drugs.’ Lawmakers, who have only just begun to wake up to the crisis, have requested more data about the synthetic opioid fentanyl, including how it is trafficked and how many people it has killed.

    The ramifications of the crisis stretch far beyond hospitals and morgues: Ohio saw a 13% increase in children in foster care last year, which officials suspect is linked to the growing number of overdose deaths.
     

  • ESPN And The Bursting Of The Sports Bubble

    Authored by William Anderson via The Mises Institute,

    When the cable TV sports giant ESPN announced 100 layoffs recently, including letting go a number of high-profile broadcasters, a lot of people took notice, and well they should: things no longer are business as usual in sports broadcasting, and we are not even at the beginning of the end, and maybe not even the end of the beginning.

    Like the slow crashing of the retail sector as online purchase firms like Amazon begin their domination, we are seeing a sea change in sports broadcasting and that is going to mean big changes are down the road not only for ESPN, but for all of the sports entities that depend upon the huge payouts that ESPN provides. To put it mildly, a lot of people are about to see their lives change drastically as consumer choices drive sports broadcasting in a new direction.

    Enough with the superlatives. What is happening with ESPN, and why is it important? As Clay Travis of the sports website Outkick the Coverage has been writing for more than a year, the main ESPN business plan, the one that brings in the most revenues to the firm, is doomed to near-extinction, and there is nothing ESPN can do about it. Writes Travis:

    In the past five years ESPN has lost 11,346,000 subscribers according to Nielsen data.

     

    If you combine that with ESPN2 and ESPNU subscriber losses this means that ESPN has lost over a billion dollars in cable and satellite revenue just in the past five years, an average of $200 million each year. That total of a billion dollars hits ESPN in the pocketbook not just on a yearly basis, but for every year going forward.

     

    It's gone forever.

    Since it began to grow in popularity in the late 1970s, cable (and later, satellite) television has offered its customers coverage with “bundles,” that is different payments allow cable subscribers to expand their viewership as payments increase. For example, a “basic” cable subscription would allow the customers to view, say, 15 channels including the ABC-CBS-NBC-PBS lineup plus other channels such as CNN or Fox. A higher-tier subscription would add other channels, including ESPN and its associated channels and others such as The Food Channel or assorted movie channels.

    One problem with bundling, of course, is that subscribers will pay for channels that they rarely or do not watch. For example, I have a basic subscription with Direct TV, but maybe watch 10 channels at most, even though dozens are available. (I don’t include ESPN or any of the other sports channels in my monthly package.)

    As technology has improved in telecommunications, the ability of providers to further segment packages has meant that cable and satellite subscribers are able to eliminate the channels they don’t want to watch, and that means that many are unhooking from ESPN. Continues Travis:

    ESPN is losing 10,000 subscribers every day so far in 2017. In the past six years they have lost 13 million subscribers and that subscriber loss is escalating each year. That's billions of dollars in lost revenue.

     

    Every year for the next five years ESPN is spending more and bringing in less. You don't have to be Warren Buffett to see that's a business problem. 

    He goes on to the heart of the matter:

    ESPN is spending over eight billion dollars on sporting rights this year and by 2021 I believe they will be losing money regardless of how many people they fire. ESPN can't fire employees into profitability. It's just not possible. These firings are going to become a yearly thing and they still aren't going to prevent the business from dying. 

    True, ESPN, as well as all commercial broadcasters, receive advertising revenue, but advertising alone, along with subscriptions from people who choose to purchase ESPN in their cable/satellite packages, will not be enough for the network to meet its obligations to the various organizations it pays for the rights to broadcast their events. From the National Football League (NFL), to the National Hockey League (NHL), to the National Basketball Association (NBA) to the National Collegiate Athletic Association (NCAA), ESPN has paid billions of dollars, money that is funneled into high athlete salaries, not to mention salaries of coaches, university athletic directors, and, indirectly into the building and maintaining of magnificent sports facilities.

    The revenues lost to ESPN are lost forever, and even given the rise of smart phones and Internet streaming, the current state of affairs is unsustainable and the sports landscape is going to change, and the changes will be extensive. It is here that Austrian economics gives us insight into how at least some of the changes will proceed.

    Carl Menger, who we know as the “founder” of the Austrian school of economics, in his path-breaking book Principles of Economics in 1871 demonstrated conclusively that the value of the factors of production was based not on costs derived from other costs of production, but rather the value of the factors was imputed via the value consumers placed upon the final goods. This view contradicted the standard British classical view that the value of consumption goods was derived from the value of the factors of production, and it placed Menger in the Pantheon of the early Marginalists.

    In laying out his theory, Menger used tobacco and the factors used to produce it. If people suddenly stopped using tobacco, he reasoned, then the value of the factors would change quickly relative to their ability to be transferred to other uses. The more specialized the factor, the greater the change in its value. For example, the land on which tobacco is grown would then be used for other purposes, such as growing corn or wheat, or even pasture for cows or sheep. Highly-specialized tools used only for growing or harvesting tobacco, however, would see a steep drop in value and maybe would have to be abandoned altogether.

    What does this have to do with the demise of ESPN? As noted earlier, the network pays billions of dollars for rights to broadcast sports events, and it is unlikely that as ESPN loses the revenues that permit it to pay large sums, other networks will be able to take up that slack. That means the organizations that now receive this money are looking at “haircuts” down the road, which includes the NCAA and collegiate athletic teams.

    The ESPN funding allows for the network to broadcast a number of collegiate sports events that ordinarily would not rate enough of an audience, and its large payouts also allow for coaches to receive record-high salaries that would not be possible if these programs depended just on ticket sales and other donations. And while it is tempting to say that “ESPN pays for this,” in reality, it is the consumer of cable/satellite television that ultimately decides the size of the ESPN payouts, and consumers are stating their preferences with their checkbooks, and there is nothing ESPN can do about it.

    Without cable/satellite subscribers being willing to pay extra for the sports channels, and without the viewership that draws advertisers, ESPN revenues will fall, and that means that the factors that make up the “product” that appears on ESPN broadcasts also are going to lose value, as long as other networks don’t take up the slack (and it is doubtful they will). Thus, one is looking at a long, steady decline and the world of televised sports is going to have to adjust to the new reality.

    Unfortunately, as Travis has pointed out many times, ESPN during this ratings slide has taken a hard turn toward the political left, which has further alienated a lot of conservative viewers. Writes Travis:

    As ESPN has lost 10,000 cable and satellite subscribers every day in 2017, seen ratings collapse for all original programming, and recently embarked on the firing of 100 employees as part of a desperate cost cutting move to save its business. The network’s sports media defenders have desperately argued that the network’s embrace of far left wing politics has not had any impact on its collapsing viewership. That’s despite the fact that there have been two different studies that have demonstrated Republican voters have abandoned the network’s original programming in the past year.

    In that regard, one can argue that ESPN has done what numerous (and especially elite) colleges and universities have done the past several years: create a hostile atmosphere for white male students all the while wanting them to be paid customers. One cannot both seek to offend and attack the same people one wishes to purchase their services without courting disaster, yet higher education and ESPN are doing just that.

    To a certain extent, one can argue that both higher education and ESPN have benefited from “bubble” economies, and as consumer choice becomes directed elsewhere, the bubbles burst. As Carl Menger demonstrated, the bursting of the bubbles will mean that some factor owners will have to receive less pay in order to remain employed, while other factors will have to be transferred to other uses altogether or simply become unemployed. All soothing rhetoric aside, the world of sports broadcasting is going to see major changes in the next decade as consumers have their say.

  • FBI Refuses To Hand Over "Comey Memos" To Congress

    House Oversight Committee Chairman Jason Chaffetz said today that the FBI had decided to withhold documents, including memos, notes, summaries, and recordings, requested by his committee in regards to the ongoing Russia probe. This was revealed in a letter sent by Chaffetz to the FBI responding to the agency’s decision to withhold documents requested by the Committee on May 16, 2017.

    The FBI’s denial to cooperate is presented below:

    According to a statement by the Oversight Committee, “Chaffetz requested memos, notes, summaries, and recordings to assist in the Committee’s investigation of the FBI’s independence, and which are outside the scope of the Special Counsel’s investigation.”

    The documents are due June 8, 2017, but that may not happen as it appears the FBI is suddenly unwilling to cooperate.  

    As Chaffetz elaborates, after a New York Times report that former Federal Bureau of  Investigation Director James Corney memorialized the content of phone calls and meetings with the President in a series of memoranda, he requested those memoranda and any related notes, summaries, and recordings. The FBI is withholding those documents, citing to the appointment of Robert Mueller as Special Prosecutor. According to a letter from your staff: “In light of this development and other considerations [the Bureau] is undertaking appropriate consultation to ensure all relevant interest implicated by your request are properly evaluated.

    The letter states:

    “The Committee has its own, Constitutionally-based prerogative to conduct investigations. But the Committee in no way wants to impede or interfere with the Special Counsel’s ability to conduct his investigation.  In fact, the Committee’s investigation will complement the work of the Special Counsel. Whereas the Special Counsel is conducting a criminal or counterintelligence investigation that will occur largely behind closed doors, the Committee’s work will shed light on matters of high public interest, regardless of whether there is evidence of criminal conduct.

     

    “The focus of the Committee’s investigation is the independence of the FBI, including conversations between the President and Comey and the process by which Comey was removed from his role as director.  The records being withheld are central to those questions, even more so in light of Comey’s decision not to testify before the Committee at this time.”

     

    “I am seeking to better understand Comey’s communications with the White House and Attorney General in such a way that does not implicate the Special Counsel’s work.”

    As Chaffetz concludes, “Congress and the American public have a right and a duty to examine this issue independently of the Special Counsel’s investigation. I trust and hope you understand this and make the right decision-to produce these documents to the Committee immediately and on a voluntary basis.

    The American public is certainly looking forward to the FBI’s release of the full content of the Comey’s memos, not only those relating to his meetings with Trump, but just as importantly, with Loretta Lynch, as well as Barack Obama and/or Hillary Clinton.

    Full text of Chairman Chaffetz letter can be viewed here.
    Full text of FBI letter can be viewed here.

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Today’s News 25th May 2017

  • Suspected Berkeley Antifa Bike Lock Attacker Eric Clanton Arrested For Assault

    Eric Clanton, 28, a former Diablo Valley and California State University philosophy professor suspected in the Antifa bike lock attacks was arrested for assault Wednesday afternoon in Oakland.

    Clanton is being held on $200,000 bail after being booked into Berkeley City Jail – though police have not said whether the arrest is connected to online investigative efforts which identified Clanton as a person of interest in bike lock attacks

    “[Clanton] was arrested on suspicion of use of a firearm during a felony with an enhancement clause and assault with a non-firearm deadly weapon. –East Bay Times

    //platform.twitter.com/widgets.js

     

    4chan unmasking

    Clanton is the suspected Antifa member going around with a bike lock assaulting Trump supporters. The weaponized autists over at 4chan ‘unmasked’ him based on photographic and video evidence along with publicly available information. 

    (Attack at 18 sec)

     

     

    How 4chan did it… 

     

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

  • Snyder: Desperate Liberals Try To Blame The Manchester Terror Attack On Anyone Other Than Islamic Terrorists

    Authored by Michael Snyder via The End of The American Dream blog,

    The left just can’t seem to understand that Islamic terrorists are going to try to destroy our way of life no matter how nice we are to them. On Monday night, a bombing at Ariana Grande’s Manchester concert made headlines all over the globe. 22 people, including an 8-year-old girl, were killed and 59 were wounded. It is exactly the sort of “soft target” attack that I have been warning about, and ISIS quickly claimed responsibility. Within the last 30 days, there have been 169 Islamic terror attacks in a total of 24 different countries. Last year, the number of global terror attacks was up 25 percent from the year before, and this year we will almost certainly see another all-time record high. But many liberals never even want to use the phrase “Islamic terror” because it doesn’t fit their agenda.

    In fact, many liberals immediately jumped on Twitter after the terror attack in Manchester and started warning about the spread of “Islamophobia”.

    For example, Quen Took posted the following tweet…

    Don’t use incident as an excuse for Islamophobia. Stand with our beautiful Muslim siblings & don’t scapegoat innocent people.

    And TheBardAsPundit warned that engaging in “Islamophobia” may provoke more terror attacks…

    I have a good idea. Let’s piss off more Muslims with mindless Islamophobia. That should help.

    Of course the mainstream media here in the United States attempted to put their own politically-correct spin on things. On ABC, there was far more concern about “anti-Islamic backlash” than there was for the victims of the attack…

    Despite the horrific nature and impact, ABC was eager to downplay the motive behind the deadly attack. In fact, ABC was more worried about the perpetrators than the victims, warning that this could provoke an “anti-Islamic backlash” across Europe.

    And on the Today show on NBC, counter-terrorism “expert” Richard Clarke seemed to blame President Trump for the rise in terror attacks that we have been seeing…

    They have a good police and security service and so do we, but we have no ostracized, we’ve embraced our Muslim Americans. That’s why the talk against Muslims in the last year in the campaign and since has been very counterproductive. The only way to solve this problem is to have everyone think they’re on the same side.

    Yes, let’s follow Clarke’s advice and try to convince the Islamic terrorists that we are on their side.

    That should work.

    Until the entire western world is willing to embrace Islam and swear allegiance to Allah, the radical Islamists will never stop. Their faith tells them that it is their destiny to rule the world, and they will never rest until they have achieved that goal.

    Unfortunately, most people believe what they want to believe, and what most politically-correct pundits in the western world want to believe is that radical Islam is not the problem.

    On CNN, one “analyst” even suggested that the attack in Manchester may have been a “false flag” conducted by “right-wing” extremists…

    CNN “Terror Analyst” Paul Cruickshank said Monday night on Anderson Cooper’s AC360 that the bombing attack in Manchester could be a “right-wing” “false flag.”

     

    “It must also be noted that in recent months in Europe, there’s been a number of false flag plots where right-wing extremists have tried to frame Islamists for terrorism,” Cruickshank said. “We have seen that in Germany in recent weeks.”

    Of course that theory didn’t last long once the authorities identified the attacker as a Muslim.

    It is absolutely imperative that we understand the mindset of these Islamic radicals. If they could press a button that would annihilate all non-Muslims on the entire planet, many of them would do it.

    Some of the more “moderate” jihadists would prefer to give everyone a chance to convert to Islam first before killing them, but the end result would be the same.

    There is no possible way to compromise with people that are intent on exterminating you. And as they get their hands on more powerful weapons, the size and scale of these terror attacks is going to increase exponentially.

    We must make every effort to defeat terror groups such as ISIS militarily, but even more importantly we must seek to turn hearts and minds away from radical Islam all over the planet. It is a bankrupt worldview, and we need to show those that are following radical Islam that there is a much better way.

    Unfortunately, nations all over the western world are turning away from the values and the principles that they were founded upon, and so western leaders have very little to offer at this point.

    One recent report found that Islam is on track to surpass Christianity and will become the largest faith on the entire planet by the year 2070. Violence and bloodshed will continue to be used by jihadists to advance their faith, but another way that the goal of global domination is moved forward is by migration. Paul Nehlen, the author of an upcoming book entitled “Wage The Battle”, recently explained how this works

    “Hijrah means ‘migration in the name of Allah,’” said Nehlen, who explained that the ultimate goal is to populate non-Muslim nations to the extent needed to impose Shariah law.

     

    “The hijrah is one way of spreading the Shariah, spreading the law of Islam, this political doctrine, to land where Islam isn’t,” Nehlen said. “That’s what this documentary covers. It talks about the bigger picture here of what we saw here. It stems directly from their fundamental texts.”

     

    He said hijrah is another method by which Muslims can earn their salvation.

     

    “Quite unlike a Christian, who believes you can’t earn your way in and only by the grace of God are you granted access to heaven through Christ’s sacrifice on the cross, Muslims believe they can earn their way in,” Nehlen said. “They believe they have to earn their way in.”

    Radical Islam has declared war on us, but most liberals don’t even think that we are in a war.

    And in any war, if one side chooses not to fight the other side wins by default.

    The western world desperately needs to wake up, because we are in a life or death battle, and right now this fight is only in the early rounds.

  • Japan's "Womenomics" Is Working Just As Well As Abenomics… Terribly

    Via Japan Subculture Research Center,

    Japan is getting serious about gender equality – and there were absolutely no bribes paid by Japan to win the right to host the 2020 Olympics – and the nuclear disaster at Fukushima is under control. Decide for yourself which of these three statements is the most untrue.

    Womenomics was touted by Japan’s Prime Minister Shinzo Abe as his progressive policy to elevate the status of women in what is still a very sexist and unequal society, where women are far from being empowered. The Global Gender Gap report published last year noted that Mr. Abe and the LDP’s pledge to bridge the gender divide resulted in actually widening the gulf, with Nippon sliding down a few notches to 111th in terms of world gender equality. 

    It’s hard to see women in Japan being “empowered” when they can be sexually assaulted with near impunity. The odds that their assailant will be arrested, or prosecuted are low–less than a coin toss. And if he is actually prosecuted–he can sometimes walk free, with no jail time and no criminal record,  by paying damages and saying, “I’m sorry.” It’s a situation that the Abe administration could have changed but neglected to do so, tabling newly revised criminal codes to instead focus on passing a conspiracy bill that the United Nations warns could erode civil liberties.

    Of course, some would argue that “womenomics” have never been about elevating the status of women in Japan – it’s always been about keeping Japanese business thriving and hopefully encouraging woman to work – and breed. Of course, pregnancy in the workplace often is greeted with bullying from all sides. Abe’s vision of Womenomics has certainly never been about improving the lives of Japan’s single mothers, 50% of whom live in poverty. In fact, other than talking about “shining women–it’s not clear exactly what he wants for Japan’s future potential birthing machines.*

    The current Minister of Gender Equality and Women’s Empowerment, is of course, also a man, and also in charge of improving Japan’s birthrate. Do we need to say more?

    Yes, Japan’s Prime Minister Abe and the LDP are gungho about Gender Equality. Meet Katsunobu Kato, his home page will convince you.

    Recently, Bloomberg published an interview with Democratic Party leader Renho, in which she pointed out the obvious, Womenomics is all talk and no walk.

    “They should be ashamed to use the word ‘Womenomics’,” Democratic Party leader Renho, the 49-year-old mother of twins, said in an interview in Tokyo late Thursday when asked about the term Abe often uses to describe his efforts. “It’s an embarrassment.”

    Abe had vowed to eliminate waiting lists for childcare in a bid to draw more women into the workforce to make up for Japan’s shrinking population. He also sought to have women take 30 percent of management positions in all fields by 2020.

    On both goals he’s falling well short: Japan was 111th in the World Economic Forum’s Gender Gap ranking for 2016, down 10 places on the previous year.

    “About 80 percent of those who take childcare leave are women, and if they’re forced to wait for daycare, that means unemployment,” Renho said.

     

    “You either get demoted or you give up on work. What’s womenomics about if women are being forced to make such sad choices?

    For the rest of the article, go to

    Abe’s Policies Failing Women, Japan Opposition Chief Says

    *Reference to women as “birthing machines” is sarcasm. We know that the LDP also thinks of women as much more than that–as potential nurses for the elderly, expert green tea brewers for the office, and caretakers of the children that they should be giving birth to right now for the greater prosperity of Japan."

  • San Francisco Launches Public Defender Office Dedicated To Illegal Immigrants

    To our complete ‘shock’, the liberal bastion of California’s northern shores has just announced that it will create a brand new branch of the Public Defender’s office to specifically defend illegal immigrants in deportation cases.  Adding insult to injury, taxpayers will have to pony up an additional $200,000 each year to cover the cost of 3 public defenders and a paralegal, all of whom will be dedicated to making sure that federal laws are ignored.

    As an NBC affiliate in the Bay Area notes, the new office is expected to handle just 50 clients per year of the 1,500 detained immigrants that currently have scheduled court dates.  All of which just means that taxpayers should expect that $200,000 price tag to grow exponentially over the coming years.  

    Unlike in criminal court, immigrants are not automatically entitled to legal representation in deportation proceedings. However, studies have shown that detained immigrants with attorneys are six times more likely to win their cases.

     

    While San Francisco also provides funding to nonprofits specializing in legal aid to immigrants, the public defender’s office is intended to serve those already in detention, a demographic the nonprofits generally don’t serve.

     

    The unit’s attorneys are each expected to handle around 50 clients per year — a small portion of the estimated 1,500 detained immigrants who currently have court dates in San Francisco, around 85 percent of whom do not have attorneys.

    Meanwhile, thanks to a press release issued by the San Francisco Public Defender’s office, we learn that the enforcement of federal laws is apparently “against our core values as Americans and San Franciscans”…who knew?

    Adachi noted that in the 100 days since President Donald Trump signed his executive order expanding immigration enforcement priorities, immigration arrests have risen 38 percent nationwide.

     

    “Mass deportation is against our core values as Americans and San Franciscans,” Adachi said. “Due process still means something in this country and we are not going to let the federal government ship off our friends and neighbors without a fight.”

     

    Unlike in criminal court, non-citizens in immigration detention do not have the right to court appointed counsel, explained Francisco Ugarte, managing attorney of the Public Defender’s Immigration Unit. Approximately half of the 1,500 detained immigrants with court dates in San Francisco have been in the U.S. for more than a decade. More than 50 percent have one or more close family members who are citizens.

     

    “These are longtime residents who work, attend school, and contribute to our city,” Ugarte said. “Without this program, most would be forced to defend themselves in court against trained government lawyers.”

    Can we also declare that ‘grand larceny’ is “against our core values as Americans” because we think it’s absolutely bogus that we can’t have a couple of Lamborghini’s just because we’re “economically challenged.”

    http://www.nbcbayarea.com/portableplayer/?cmsID=423977644&videoID=tEXs4tolM5J0&origin=nbcbayarea.com&sec=news&subsec=local&Width=600%20Height=337

  • Meet JK2 Westminster LLC – The Kushner Family Real Estate Subsidiary Preying On Poor People

    Authored by Mike Krieger via Liberty Blitzkrieg blog,

    Cox stopped cooking for herself and her son, not wanting food near the sink. A judge allowed her reduced rent for one month. When she moved out soon afterward, Westminster Management sent her a $600 invoice for a new carpet and other repairs. Cox, who is now working as a battery-test engineer and about to buy her first home, was unaware who was behind the company that had put her through such an ordeal. When I told her of Kushner’s involvement, there was a silence as she took it in.

     

    Very few of the complex residents I met, even ones who had been pursued at length in court by JK2 Westminster, had any idea that their rent and late fees were going to the family company of the president’s son-in-law. “That Jared Kushner?” Danny Jackson, a plumber in his 15th year living at Harbor Point Estates, exclaimed. “Oh, my God. And I thought he was the good one.”

     

    At the Carroll Park complex, I met Mike McHargue, a private investigator, and his girlfriend, Patricia Howell. “They’re nothing but slumlords,” Howell told me of Westminster Management. “They take everyone’s money.” When I asked if they knew who was behind the company, they said they did not. “Oh, really?” Howell said when I mentioned Kushner’s name. “Oh, really. And I’m a Trump supporter.”

     

    From The New York Times Magazine article: Jared Kushner’s Other Real Estate Empire

    Yesterday, The New York Times Magazine published a deeply disturbing story about a Kushner family real estate subsidiary with a consistent pattern of aggressive and questionable collection practices aimed at lower income people who can’t defend themselves properly.

    Excerpts from the piece are below, but it should really be read in full.

    Warren sent a letter reporting the problem to the complex’s property manager, a company called Sawyer Realty Holdings. When there was no response, she decided to move out. In January 2010, she submitted the requisite form giving two months’ notice that she was transferring her Section 8 voucher — the federal low-income subsidy that helped her pay the rent — elsewhere. The complex’s on-site manager signed the form a week later, checking the line that read “The tenant gave notice in accordance with the lease.”

     

     

    So Warren was startled in January 2013, three years later, when she received a summons from a private process server informing her that she was being sued for $3,014.08 by the owner of Cove Village. The lawsuit, filed in Maryland District Court, was doubly bewildering. It claimed she owed the money for having left in advance of her lease’s expiration, though she had received written permission to leave. And the company suing her was not Sawyer, but one whose name she didn’t recognize: JK2 Westminster L.L.C.

     

     

    Warren was raising three children alone while taking classes for a bachelor’s degree in health care administration, and she disregarded the summons at first. But JK2 Westminster’s lawyers persisted; two more summonses followed. In April 2014, she appeared without a lawyer at a district-court hearing. She told the judge about the approval for her move, but she did not have a copy of the form the manager had signed. The judge ruled against Warren, awarding JK2 Westminster the full sum it was seeking, plus court costs, attorney’s fees and interest that brought the judgment to nearly $5,000. There was no way Warren, who was working as a home health aide, was going to be able to pay such a sum. “I was so desperate,” she said.

     

     

     

    If the case was confounding to Warren, it was not unique. Hundreds like it have been filed over the last five years by JK2 Westminster and affiliated businesses in the state of Maryland alone, where the company owns some 8,000 apartments and townhouses. Nor was JK2 Westminster quite as anonymous as its opaque name suggested. It was a subsidiary of a large New York real estate firm called Kushner Companies, which was led by a young man whose initials happened to be J.K.: Jared Kushner.

     

     

    In August 2012, a Kushner-led investment group bought 5,500 multifamily units in the Baltimore area with $371 million in financing from Freddie Mac, the government-backed mortgage lender — another considerable bargain. Two years later, Kushner Companies picked up three more complexes in the Baltimore area for $37.9 million. Today, Westminster Management, Kushner Companies’ property-management arm, lists 34 complexes under its control in Maryland, Ohio and New Jersey, with a total of close to 20,000 units.

     

    Kushner’s largest concentration of multifamily units is in the Baltimore area, where the company controls 15 complexes in all — which, if you assume three residents per unit, could be home to more than 20,000 people. All but two of the complexes are in suburban Baltimore County, but they are only “suburban” in the most literal sense. They sit along arterial shopping strips or highways, yet they are easy to miss — the Highland Village complex, for example, is beside the Baltimore-Washington Parkway, but the tall sound barriers dividing it from the six-lane highway render its more than 1,000 units invisible to the thousands traveling that route every day.

     

    At the time of the 2012 Baltimore purchase, Kushner raved about the promise of the low-end multifamily market. “It’s proven over the last few years to be the most resilient asset class, and at the end of the day, it’s a very stable asset class,” he told Multifamily Executive. He said things were proceeding well in the Midwestern complexes he purchased a year earlier. “It was a lot of construction and a lot of evictions,” he said. “But the communities now look great, and the outcome has been phenomenal.”

    Awesome!

    Meanwhile, back to Warren…

    Kamiia Warren still had not paid the $4,984.37 judgment against her by late 2014. Three days before Christmas that year, JK2 Westminster filed a request to garnish her wages from her in-home elder-care job. Five days earlier, Warren had gone to court to fill out a handwritten motion saying she had proof that she was given permission to leave Cove Village in 2010 — she had finally managed to get a copy from the housing department. “Please give me the opportunity to plead my case,” she wrote. But she did not attach a copy of the form to her motion, not realizing it was necessary, so a judge denied it on Jan. 9, on the grounds that there was “no evidence submitted.”

     

    The garnishing started that month. Warren was in the midst of leaving her job, but JK2 Westminster garnished her bank account too. After her account was zeroed out, a loss of about $900, she borrowed money from her mother to buy food for her children and pay her bills. That February — five years after she left Cove Village — Warren returned to court, this time with the housing form in hand, asking the judge to halt garnishment. “I am a single mom of three and my bank account was wiped clean by the plaintiff,” she pleaded in another handwritten request. “I cannot take care of my kids when they snatch all of my money out of my account. I do not feel I owe this money. Please have mercy on my family and I.” She told me that when she called the law office representing JK2 Westminster that same day from the courthouse to discuss the case, one of the lawyers told her: “This is not going to go away. You will pay us.”

     

    The judge denied Warren’s request without explanation. And JK2 Westminster kept pressing for the rest of the money, sending out one process server after another to present Warren with legal papers. Finally, in January 2016, the court sent notice of a $4,615 lien against Warren — a legal claim against her for the remaining judgment. Warren began to cry as she recounted the episode to me. She said the lien has greatly complicated her hopes of taking out a loan to start her own small assisted-living center. She had gone a couple of years without a bank account, for fear of further garnishing. “It was just pure greed,” she said. “It was unnecessary.” I asked why she hadn’t pushed harder against the judgment once she had the necessary evidence in hand. “They know how to work this stuff,” she replied. “They know what to do, and here I am, I don’t know anything about the law. I would have to hire a lawyer or something, and I really can’t afford that. I really don’t know my rights. I don’t know all the court lingo. I knew that up against them I would lose.”

     

    A search for “JK2 Westminster” in the database of Maryland’s District Court system brings back 548 cases in which it is the plaintiff — and that does not include hundreds of other cases that have been filed in the name of the company’s individual complexes.

     

    In the cases that Tapper has brought to court on behalf of JK2 Westminster and individual Kushner-controlled companies, there is a clear pattern of Kushner Companies’ pursuing tenants over virtually any unpaid rent or broken lease — even in the numerous cases where the facts appear to be on the tenants’ side. Not only does the company file cases against them, it pursues the cases for as long as it takes to collect from the overmatched defendants — often several years. The court docket of JK2 Westminster’s case against Warren, for instance, spans more than three years and 112 actions — for a sum that amounts to maybe two days’ worth of billings for the average corporate-law-firm associate, from a woman who never even rented from JK2 Westminster. The pursuit is all the more remarkable given how transient the company’s prey tends to be. Hounding former tenants for money means paying to send out process servers who often report back that they were unable to locate the target. This does not deter Kushner Companies’ lawyers. They send the servers back out again a few months later.

     

    In March 2009, Joan Beverly, a probation agent, signed the lease for her daughter, Lennettea, for a unit at Dutch Village, a complex on the northern edge of Baltimore. Lennettea moved out a year later, several months before her lease was up. Kushner Companies bought Dutch Village more than two years later. In December 2012, JK2 Westminster filed suit in Baltimore County District Court against Beverly, seeking $3,810.16 — several months of rent it said it was owed, plus about $1,000 in repair costs, including $10 for “failure to return laundry room card.”

     

    That February, Lennettea filed a written court notice explaining that her mother, who was dying of pancreatic cancer, was “in terminal hospice care and is not eligible to work.” She added by way of supporting evidence a letter from the hospice provider to Joan Beverly’s bank, explaining her and her husband’s late mortgage payments on their home: “There has been added financial stress because Mrs. Beverly is very ill at this time.” But JK2 Westminster persisted in seeking a hearing on the suit. In March, a district court judge found in favor of the company — a total judgment against Joan of more than $5,500.

     

    Joan died two weeks later. Her husband, Tyrone Beverly, a retired longshoreman, requested that the judgment against his deceased wife be removed but was denied. The case remains open in the court database. Tyrone, who was married to Joan for 32 years, told me that he had assumed the judgment had been dismissed and was unaware that it was still listed as awaiting payment. “They just didn’t treat us fair,” he said.

     

    Over all, about nine out of every 10 cases brought by JK2 Westminster that I surveyed resulted in judgments against the defendants, who often did not appear in person for the hearings — and if they did, almost never had legal representation. How could it possibly be worth Kushner Companies’ while to pursue hundreds of people so aggressively over a few thousand dollars here and there? After all, the pursuit itself cost money. And it wasn’t happening just in Baltimore — Doug Wilkins, a lawyer in Toledo who has represented some of the complexes bought there by Kushner, told me the company is seeking far more monetary judgments than did previous owners.

     

    Matthew Hertz, whose Bethesda, Md., firm represents landlords and tenants in similar cases, explained to me that there is a logic behind such aggressive tactics. The costs of the pursuit are not as high as you might imagine, he said — people are not that hard to find in the age of cellphones and easily accessible databases. “If I give my process server a name and phone number, it’s generally enough to trace you,” he said. “If I have a date of birth and Social Security number, it’s even easier.” The legal costs can be billed to the defendant as attorney’s fees, if the terms of the lease allow. And garnishing wages is relatively easy to do by court order, assuming the defendant has wages to garnish.

     

    The Highland Village complex, along the Baltimore-Washington Parkway, is one of Kushner Companies’ largest, a vast maze of lanes and courts lined with rows of short brick-and-siding-fronted homes. Like the other Kushner complexes I visited in Baltimore’s southern and eastern suburbs, it is situated in what was once a predominantly white working-class community, within reasonable commuting distance of the harbor and industrial plants, now defunct, like Bethlehem Steel. In recent decades, many black transplants from the city and Hispanic immigrants have arrived as well, and Highland Village is an unusually integrated place.

     

    The complex, like the others I saw, seemed designed to preclude neighborliness — most of the townhouses lack even the barest stoop to sit out on, and at least one complex has signs forbidding ball-playing (“violators will be prosecuted”). At another complex, kids had drawn a rectangle on the side of a storage shed in lieu of a hoop for their basketball game. The only meeting points at many of the complexes are the metal mailbox stands, the Dumpsters and the laundry room. And the only thing that united many of the residents I spoke to, it seemed, was resentment of their landlord.

     

    They complained about Westminster Management’s aggressive rent-collection practices, which many told me exceeded what they had experienced under the previous owners. Rent is marked officially late, they said, if it arrives after 4:30 p.m. on the fifth day of the month. But Westminster recently made paying the rent much more of a challenge. Last fall, it sent notice to residents saying that they could no longer pay by money order (on which many residents, who lack checking accounts, had relied) at the complex’s rental office and would instead need to go to a Walmart or Ace Cash Express and use an assigned “WIPS card” — a plastic card linked to the resident’s account — to pay their rent there. That method carries a $3.50 fee for every payment, and getting to the Walmart or Ace is difficult for the many residents without cars.

     

    The worst troubles may have been those described in a 2013 court case involving Jasmine Cox’s unit at Cove Village. They began with the bedroom ceiling, which started leaking one day. Then maggots started coming out of the living-room carpet. Then raw sewage started flowing out of the kitchen sink. “It sounded like someone turned a pool upside down,” Cox told me. “I heard the water hitting the floor and I panicked. I got out of bed and the sink is black and gray, it’s pooling out of the sink and the house smells terrible.”

     

    Cox stopped cooking for herself and her son, not wanting food near the sink. A judge allowed her reduced rent for one month. When she moved out soon afterward, Westminster Management sent her a $600 invoice for a new carpet and other repairs. Cox, who is now working as a battery-test engineer and about to buy her first home, was unaware who was behind the company that had put her through such an ordeal. When I told her of Kushner’s involvement, there was a silence as she took it in.

     

    Very few of the complex residents I met, even ones who had been pursued at length in court by JK2 Westminster, had any idea that their rent and late fees were going to the family company of the president’s son-in-law. “That Jared Kushner?” Danny Jackson, a plumber in his 15th year living at Harbor Point Estates, exclaimed. “Oh, my God. And I thought he was the good one.”

     

    At the Carroll Park complex, I met Mike McHargue, a private investigator, and his girlfriend, Patricia Howell. “They’re nothing but slumlords,” Howell told me of Westminster Management. “They take everyone’s money.” When I asked if they knew who was behind the company, they said they did not. “Oh, really?” Howell said when I mentioned Kushner’s name. “Oh, really. And I’m a Trump supporter.”

     

    Jared Kushner stepped down as chief executive of Kushner Companies in January. But he remains a stakeholder in the company — his share of company-related trusts is estimated to be worth at least $600 million — and the company says it has no intention of selling off its multifamily holdings. (JK2 Westminster was formally dissolved in December, but Kushner Companies still owns the complexes through other entities; lawsuits against tenants are now typically filed in the names of the complexes themselves.) Because Kushner retains his interest in the complexes, the White House told The Baltimore Sun in February that he would recuse himself from any policy decisions about Section 8 funding, as many of his tenants rely on it for their rent. But even as Kushner now busies himself with his ever-expanding White House portfolio, his company is carrying on its vigorous efforts in court.

    On a related note, here’s an article I published earlier this month: Kushner Companies Seen Hawking Shady U.S. Visa Buying Residency Program to Wealthy Chinese

  • "Something's Breaking" – Yuan Suddenly Spikes To 2-Month Highs

    Traders in Asia are bemused as offshore Yuan suddenly spikes by the most in 2 months (following dollar’s post-Fed-Minutes breakdown) to 2-month highs…

    It seems The Fed’s potentially dovish realisation that data-dependence is going to hold them back from their plans to hike rates no matter what is rippling through the world’s risk markets as Yuan spikes suddenly and dramatically in Asia trading…

    Sending offshore Yuan to 2-month highs..

     

    As we warned earlier it seems The National Team are active in stocks…

     

    Rebounding once again even as Iron ore plumbs new depths.

    As one Hong Kopng based trader said “something’s breaking!”

  • Comey 'Friend' Warns Trump "If I Were You, I'd Be Scared"

    First it was anonymous colleagues, then his dad, and now it's a 'friend' of Jim Comey that CNN reports the fired FBI director has a story to tell, adding that he would be scared if he were President Trump.

    As The Hill reports, Benjamin Wittes, who describes himself as a Comey confidant, said on CNN when asked how Comey was doing.

    "He's going to be fine. He's not somebody who spends time feeling sorry for himself,"

     

    "I thought it was interesting and very telling that he declined an opportunity to tell his story in private. He clearly wants to do it in a public setting,"

     

    "I think that's a reflection of the fact that this is a guy with a story to tell. I think if I were Donald Trump that would scare me a lot."

    This comes days after a report said Comey is expected to testify that he believes Trump was deliberately trying to meddle in the FBI's investigation of Russian interference in the presidential election.

    One wonders how long until Ray Dalio, Comey's former boss, and until recently a fan of Donald Trump, is also asked to comment (off the record) on the upcoming Pay Per View show  of the century, as Comey finally sits down to "clear the air."

  • What Is Causing China's Yield Curves To Invert: UBS Answers

    Something strange is taking place in China, and we are not talking about the largely optical, mostly irrelevant first downgrade of China by Moody’s since 1989 (which still managed to unleash diplomatic hell in Beijing), and in which the rating agency simply admitted what everyone else already knew about the 300% debt/GDP economy.

    The bigger issue, as we noted previously, is that both the short-term

     

    and conventional Chinese funding market appears to be breaking…

    … because as of this week, not only has the one-year Shanghai Interbank Offered Rate, or SHIBOR, exceeded the Loan Prime Rate for the first time ever, meaning Chinese banks’ cost of borrowing is now above the rate they charge customers, but the Chinese government bond yield curve has inverted in not just one, but two places, with both the 3s5s and the 7s10s negative.

     

    The question everyone wants answered is why. One attempt at just that, came today from UBS which first give the blow by blow of how we got there:

    As market concerns about financial regulation continued in the first half of May, bond yields kept rising, with the 10-year CGB yield reaching 3.69% on 10 May. The People’s Bank of China (PBoC) renewed MLFs and increased net liquidity injection through OMOs. April economic data, such as FAI released by NBS, came in weaker than market expectations. More importantly, there were media reports that the China Banking Regulatory Commission (CBRC) showed a soft tone in requirements for banks to reach standards. Besides, the central bank’s statement on strengthening coordination in financial regulations eased market concerns about financial regulation.

    As a result of these factors, the back end of the yield curve declined while the front end to continued rising moderately. According to Chinabond yield curves, as of 19 May 2017, 1-year, 5-year and 10-year CGB yields were 3.48%, 3.68% and 3.63%, respectively, up 9bp, 20bp and 7bp compared with 5 May 2017. Yields of 1-year, 5-year and 10-year policy financial bonds (CFBs; we use the bonds issued by the Export and Import Bank of China as examples) were 4.11%, 4.45% and 4.51%, respectively, up 21bp, 10bp and 6bp compared with 5 May 2017.

    UBS notes that from the historical data of term spreads, we can see that inversion of 7-year and 10-year has happened more often, which could be attributed to better liquidity in the secondary market for 10-year bonds, but the recent greater than 10bp spread between 7-year and 10-year yields is still the first time that has happened over the past few years. The inverted 3s/10s and 5s/10s curve is also rare to see.

    And while liquidity may be a factor, UBS concedes that liquidity gaps have always existed and may not be the main reason for the recent curve inversion. As such, the Swiss bank admits that “we need to consider some other factors.

    Below are some of the incremental factors besides liquidity:

    • In terms of CGB issuance in the primary market, auction results in May showed that auction rates were all higher than market expectations, except for the 50-year CGB auction, which came in lower than the market’s expectation. Also, the spread between auction results and market expectations was larger for the less liquid tenors.
    • That indicates that during weak market sentiment, a negative feedback loop formed between the primary market and secondary market. Besides, from an allocation demand perspective, insurance companies have shown increased demand for CGBs in recent months, in addition to banks, the major buyers of CGBs, which may provide support to long-tenor bonds.

    More importantly, however, UBS notes that the inverted curve also reflects a contradiction between market expectations on policies and economic fundamentals.

     On one hand, the slowdown of economic growth may prevent the back end of the yield curve from further going up. On the other hand, financial institutions’ funding costs have kept rising but the financing costs for the real economy measured by loan rates have not risen that much. And investors can hardly expect the monetary policy to ease in the current circumstances.

    • We think the rise in financial institutions’ funding costs shows their intention to maintain the current asset/liability scale. From this perspective, the deleveraging process may continue for a longer period, while the change in economic fundamentals has not been enough to trigger a reversal of the monetary policy tone. We think in the short term, the yield curve is more likely to repair by having the back end go up again when the gap between market expectations and implementation of financial regulations appears again. Among long-tenor CGBs, the spread between 7-year and 10-year yields is quite large, which has made the relative value of 7-year CGBs rise much higher, in our view. We think when market sentiment calms temporarily, the yield of 7-year CGBs may adjust downward and provide a tactical trading opportunity. However, we expect the 10-year CGB yield to fluctuate at a high level, with a short-term cap around 3.7-3.8%. Although economic fundamentals may put some limit on the rise of the 10-year level, we don’t think there is much room for downside adjustment. Over a longer period, considering the progress of deleveraging, we think investors still need to pay attention to the renewal of banks’ funds that are under management of non-bank financial institutions in H2.
    • Regarding the front end of the yield curve, although we think room for money market rates to go lower is limited in the short term, market expectations about liquidity conditions could stabilize, given PBoC’s recent tone, and that may create room for the front end of the CGB curve to go a bit lower. Over a longer period, we think if a more apparent economic slowdown happens in H2 and forces monetary policy to adjust, a larger opportunity for the front end to move down may appear.

    The above not only why the CGB curve is inverted, but also why SHIBOR1Y is now above the LPR.

    And while that may answer why both the CGB and the short-term funding yield curves are inverted, another, just as pressing question emerges: assuming UBS is right, and these yield oddities are merely “contradictions” between market reality and hopes, what happens when this divergence between fundamentals and expectations converges, and more importantly, what will such a mean reversion look like for China’s already bizarrely trading financial assets.

  • Angry China Slams Moodys For Using "Inappropriate Methodology"

    The market may have long since moved on from Moody’s downgrade of China to A1 from Aa3 (by now even long-only funds have learned that in a world with $18 trillion in excess liquidity, the opinion of Moodys is even more irrelevant), but for Beijing the vendetta is only just starting, and in response to Tuesday’s downgrade, China’s finance ministry accused the rating agency of applying “inappropriate methodology” in downgrading China’s credit rating, saying the firm had overestimated the difficulties faced by the Chinese economy and underestimated the country’s ability to enhance supply-side reforms.

    In other words, Moody’s failed to understand that 300% debt/GDP is perfectly normal and that China has a very explicit exit strategy of how to deal with this unprecedented debt load which in every previous occasion in history has led to sovereign default.

    The Ministry of Finance reaction came after Moody’s first, and very, very long overdue, downgrade of China since 1989 citing concerns about risks from China’s relentlessly growing debt load as shown below.

    “China’s economy started off well this year, which shows that the reforms are working,” the ministry said in a statement on its website.  Actually, it only shows that China had injected a record amount of loans into the economy at the start of the year, and nothing else. And now that the credit impulse is fading, the hangover has arrived.

     

    Moody’s on Wednesday also downgraded the ratings of 26 Chinese government-related non-financial corporate and infrastructure issuers and rated subsidiaries by one notch. It also downgraded the ratings of several domestic banks, including the Agricultural Bank of China Limited’s long-term deposit rating from A1 to A2.  It also eventually downgraded Hong Kong and said credit trends in China will continue to have a significant impact on Hong Kong’s credit profile due to close economic, financial and political ties with the mainland.

    So how did China defend its position? The same way US companies fabricate their own numbers to confuse shareholders: with “pro forma” arguments.

    For example Moody’s noted that the importance Chinese authorities have attached to maintaining robust growth would result in sustained policy stimulus, and such government spending would contribute to rising debt across the economy. “We expect the government’s direct debt burden to rise gradually toward 40 percent of GDP by 2018 and closer to 45 percent by the end of the decade,” Moody’s noted.

    To this, the MOF responded that government bonds reached 27.33 trillion yuan ($3.97 trillion) at the end of 2016, or about 37% of the country’s GDP. The proportion is much lower than the 60% picket line delimited by the EU, the ministry said.  Liu Xuezhi, a senior analyst at the Bank of Communications, said that the proportion of government bonds to GDP has been continuously dropping since peaking in 2013, largely due to the government efforts to manage debt.

    “I think Moody’s reasons are debatable,” he said.

    Of course, what the MOF forgot to mention is the roughly 200% in corporate debt issued in large part by entities that are State-owned enterprises, and which the government for mostly refuses to go bankrupt over fears of mass riots, civil disobedience and even war.  As a result virtually all of China’s corporate debt is effectively sovereign.

    That did not prevent China from spinning more propaganda.

    Zheng Xinye, associate dean of the School of Economics at the Renmin University of China, also told the Global Times on Wednesday that the government has taken effective measures, such as bond swaps and perfecting the issuance and management system of local government debt, to rein in bond risks.  Liu added that China’s fiscal revenue has been rising since 2009. “Besides, the Chinese government has income channels which other countries don’t, such as land transfer money and State assets. Therefore, I don’t think China would be facing serious financial pressure, at least not in the next few years,” he told the Global Times on Wednesday.

    Zheng also said that the government wouldn’t need to use fiscal measures to stimulate growth, as the effects of supply-side reforms would sustain the economy’s momentum.  He may have even said it with a straight face.

    Additionally, China took offense at Moody’s forecast that China’s growth will slow to 5% in five years, because of a smaller working-age population and continuing production slowdown. 

    To this, Liu said the chances are very slim for China’s economy to slip to 5 percent in the next five years. “I believe China’s GDP growth will remain above 6.5 percent at the end of 2020, as China has abundant room for policy adjustments to support economic growth,” Liu said. It has even more abundant room to goalseek its data to whatever it wants, however, without the benefit of “creating” 40% of GDP in the form of new credit, China’s economy will implode.

    Zheng disagreed, and said the economy has not shown any signs of sliding.

    One place where China’s apparatchiks were right is that Moody’s downgrade would hurt overseas investor confidence in the Chinese market or collaborations with domestic companies.

    “It would also make it more difficult for domestic companies to seek financing in overseas markets,” Liu noted.  But Liu said domestic financial markets would not be affected as much, because they’re not entirely open. And for a good, if scary, explanation of what happens as China’s debt issuance shift domestically, read this morning Bloomberg piece “China’s Downgrade Could Lead to a Mountain of Debt.”

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Today’s News 24th May 2017

  • If At First You Don't Succeed… A Timeline Of Elon Musk's Long List Of Failures

    At first glance, it’s easy to be impressed by Elon Musk’s impressive resume. He’s shooting for the stars with SpaceX, changing the future of transportation with Tesla, Hyperloop, and The Boring Company, and he’s already had a profound impact on the e-commerce and payments sectors through Paypal. It’s no coincidence that most of these are $1 billion+ companies. But, as Visual Capitalist's Jeff Desjardins notes, focusing only on his successes provides a superficial view of the man. To get the full perspective on his career, it is much more interesting to look at the failures and lows he has experienced. These are the moments when most people would have likely given up.

    FAILING OFTEN

    As every entrepreneur knows, any business venture can be upended by failures at any moment – and it is how one bounces back from those failures that counts. Today’s infographic from Kickresume shows Musk’s struggles and failures throughout his career, and how he persevered to become a modern business icon.

    Courtesy of: Visual Capitalist

    As the ever-quotable Winston Churchill once said:

    Success is not final, failure is not fatal: it is the courage to continue that counts. – Winston Churchill

    After being ousted out of his own company, having many rockets go bust, and fighting to keep Tesla and SpaceX from going bankrupt, Musk kept pushing forward with courage.

    WHAT WE CAN LEARN

    Entrepreneurs hold people like Steve Jobs, Elon Musk, and Richard Branson in high reverence. Sometimes, we even put them on a pedestal, thinking we could only dream of making such a profound impact on the world. However, this is obviously a one dimensional view. These figures are not superhuman, and the reality is that they’ve all experienced tragic failures throughout the course of their careers. They’ve been disheartened, but they bounced back. We have to recognize that success in business isn’t what it appears to be on magazine covers and headlines. Failure is an everyday part of doing business, and it plagues almost every entrepreneur in some shape or form. The difference is in how you react to it.

    …and of course, it helps to be on the right side of government handouts too…

  • Did Trump's Islam Speech In Saudi Arabia Pave The Way For America's Next Big War

    Authored by Darius Shahtahmasebi via TheAntiMedia.org,

    The American public is most likely unaware of the giant stranglehold Saudi Arabia has on the U.S. government. Saudi Arabia uses its vast riches to manipulate the U.N., which explains how a country that brutally oppresses its female population was recently gifted a seat on the organization’s women’s rights commission. The Islamic Kingdom also wields incredible control over international media and has arguably had an increasingly unwelcome position of power in America’s foreign policy decision-making. As such, Donald Trump’s political career, in part, rests on appeasing his Saudi Arabian counterparts.

    And appeasing the Saudis is exactly what Trump has done. Trump’s speech regarding Islam was delivered to the leaders of 55 Muslim-majority nations, including Saudi Arabia. However, he conveniently ignored the troves of evidence that show Saudi Arabia directly sponsors the terror groups al-Qaeda and ISIS – two groups the U.S. claims to be at war with — as well as the fact that Saudi Arabia has been directly implicated in the 9/11 terror attacks. Instead, Donald Trump framed the entire issue of radicalization as a problem that rests with Iran. As he stated in Riyadh:

    “But no discussion of stamping out this threat would be complete without mentioning the government that gives terrorists all three—safe harbor, financial backing, and the social standing needed for recruitment. It is a regime that is responsible for so much instability in the region. I am speaking of course of Iran. From Lebanon to Iraq to Yemen, Iran funds, arms, and trains terrorists, militias, and other extremist groups that spread destruction and chaos across the region. For decades, Iran has fueled the fires of sectarian conflict and terror.

     

    It is a government that speaks openly of mass murder, vowing the destruction of Israel, death to America, and ruin for many leaders and nations in this room.”

    Iran’s prime enemies are actually Sunni-dominated terror groups such as al-Qaeda and ISIS. The Islamic Republic and its proxies have been heavily engaged in fighting these terror groups in Syria. If eradicating terrorism was a priority for the United States and Saudi Arabia, Iran would be a natural ally considering Iran almost all but defeated ISIS in Iraq.

    Yet, Trump continued:

    "Among Iran’s most tragic and destabilizing interventions have been in Syria. Bolstered by Iran, Assad has committed unspeakable crimes, and the United States has taken firm action in response to the use of banned chemical weapons by the Assad regime—launching 59 tomahawk missiles at the Syrian air base from where that murderous attack originated.”

    While many analysts may focus on how Trump has gone from the most Islamophobic president ever elected to now omitting the words “radical Islamic terrorism” from his speech on Islam, these analysts continue to gloss over the fact that the entire speech appears to have been a geopolitical gesture to please Saudi Arabia and its allies. As the Iranian Foreign Ministry noted, Trump is no longer concerned with Islamophobia but what Iran has coined as “Iranophobia.”

    Iran is Saudi Arabia’s regional archrival. The two countries are fighting an enormous proxy war in Syria because Saudi Arabia views an Iranian-aligned government as a threat to its economic interests. Saudi Arabia is also currently bombing Yemen into oblivion as fears of a Shi’a led government capable of aligning itself with Tehran became a probable reality in 2015.

    Most hypocritical, however, was the following statement:

    Until the Iranian regime is willing to be a partner for peace, all nations of conscience must work together to isolate Iran, deny it funding for terrorism, and pray for the day when the Iranian people have the just and righteous government they deserve.

    Even establishment outlets such as the BBC could not allow this statement to go unchecked. The BBC stated:

    “And amongst several cynical reactions to the speech from around the region on social media, some have pointed out that here in Saudi Arabia women are forbidden to drive and there are no parliamentary elections. In Iran, the country accused by Mr Trump of being behind much of the current terrorism across the Middle East, they have just had a free election and women are free to drive. [emphasis added]

    Iran’s recent elections saw one of the heaviest turnouts in the country’s history, much higher than that of the United States. It is technically one of the most democratic countries in the region. While Iran would not be considered greatly democratic by Western standards, this is a testament to how undemocratic Iran’s rivals in the region are, including Saudi Arabia. Even prisoners were allowed to vote in Iran, something so-called democratic countries such as New Zealand disallow.

    Despite all of this “Iranophobic” sentiment, it is also worth noting that Iran’s alleged nuclear program is rarely discussed in the international arena anymore. This is because the Trump administration is well aware that the Iranian nuclear deal reached in 2015 is working – and there is no current nuclear threat from Iran. In this context, the U.S. government has to look for alternative modes of hyping up an Iranian threat to justify a massive arms deal.

    And yet, spearheaded by Trump, the Arab world has just announced a new military pact that will directly confront Iran. Called the “Riyadh Declaration,” the pact was signed by representatives from 55 Islamic nations that have vowed “to combat terrorism in all its forms, address its intellectual roots, dry up its sources of funding and to take all necessary measures to prevent and combat terrorist crimes in close cooperation among their states.”

    How can a coalition, led by Saudi Arabia, combat terrorism and extremism when Saudi Arabia’s Wahhabist philosophy is responsible for most of today’s terrorism-related problems? As noted by the Independent:

    “The state systematically transmits its sick form of Islam across the globe, instigates and funds hatreds, while crushing human freedoms and aspiration…The jaw simply drops. Saudi Arabia executes one person every two daysRaif Badawi, a blogger who dared to call for democracy, was sentenced to 10 years and 1,000 lashes. Last week, 769 faithful Muslim believers were killed in Mecca where they had gone on the Hajj. Initially, the rulers said it was ‘God’s will’ and then they blamed the dead.”

    The military pact will also include an “Islamic Military Coalition,” which will “provide a reserve force of 34,000 troops to support operations against terrorist organizations when needed.”

    The original text of the document was heavily infatuated with Iran but has since been amended. The original text also said these troops would be deployed to Syria and Iraq “when needed,” which is — again — clearly aimed at countering Iranian influence as Iran is heavily tied to both countries. Saudi Arabia has already expressed its intention to send troops into Syria multiple times before, with the exclusive goal of ensuring that “liberated areas [do] not fall under the control of Hizballah, Iran or the regime.”

    The United States, Britain, and associated forces are creeping into Syria as we speak, directly paving the way for an all-out confrontation with Syrian troops in al-Tanf. Just last week, the U.S. military bombed these troops, even though they are directly backed by Iran (and most likely Russia, too).

    This is no secret to the mainstream media. The Washington Post just released an article hours ago entitled “How Trump could deal a blow to Iran — and help save Syria,” with the conclusion that the battle for al-Tanf  is “a fight that the United States cannot and should not avoid.” Dealing a strategic blow to Iran and Syria will only empower ISIS given that they are the most heavily engaged entities fighting the terror groups in Syria.

    The Trump administration’s seeds are being sown in tandem with the corporate media. Trump’s speech had nothing to do with radical Islam. It was written by Stephen Miller, the “architect” of Donald Trump’s travel ban (a policy that also vehemently targeted Iran, among other countries).

    Selling a war with Iran to the American public may be difficult considering the Islamic nation twice elected a reformist who is open to making diplomatic deals with the United States. However, selling a war that will take place inside Syria is somewhat less problematic, even if that war is against the Syrian government, as the American public is easily manipulated by Assad’s alleged war crimes. As Iran is Syria’s closest ally, it will be easily drawn into a confrontation.

    If Saudi Arabia’s coalition of anti-Iranian Muslim nations illegally joins this battle arena, the resulting war will be catastrophic.

  • WannaCry Attackers Have Links To North Korea's Lazarus Group

    Cybersecurity researchers at Symantec say they've found linkes between the WannaCry Ransomware attackers was likely carried out by a hacking group with ties to North Korea.

    In a blog post, Symantec said the “Tools and infrastructure used in the WannaCry ransomware attacks have strong links to Lazarus, the group that was responsible for the destructive attacks on Sony Pictures and the theft of $81 million from the Bangladesh Central Bank.”

    Here's a summary of links provided by Symantec:

    • Following the first WannaCry attack in February, three pieces of malware linked to Lazarus were discovered on the victim’s network: Trojan.Volgmer and two variants of Backdoor.Destover, the disk-wiping tool used in the Sony Pictures attacks.
    • Trojan.Alphanc, which was used to spread WannaCry in the March and April attacks, is a modified version of Backdoor.Duuzer, which has previously been linked to Lazarus.
    • Trojan.Bravonc used the same IP addresses for command and control as Backdoor.Duuzer and Backdoor.Destover, both of which have been linked to Lazarus.
    • Backdoor.Bravonc has similar code obfuscation as WannaCry and Infostealer.Fakepude (which has been linked to Lazarus).
    • There is shared code between WannaCry and Backdoor.Contopee, which has previously been linked to Lazarus.

    Symantec discovered that the WannaCry attackers used some of the same hacking tools that were previousky used in other Lazarus Group attacks. There are also, the group reported, “a number of links between WannaCry itself and Lazarus.”

    The WannaCry ransomware, for example, shares some code with a piece of malware that has previously been linked to Lazarus.

    Symantec also found that the WannaCry attackers used some of the same network infrastructure as the Lazarus Group. “There are a number of crossovers seen in the C&C servers used in the WannaCry campaigns and by other known Lazarus tools.”

    Beginning a week ago Friday, the WannaCry virus infected thousands of computers around the world, threatening to destroy users' data unless a ransom was paid in bitcoin. Ultimately, the group received less than $100,000, and most of the data were destroyed.

  • The Republic Has Fallen: The Deep State's Plot To Take Over America Has Succeeded

    Submitted by John Whitehead via The Rutherford Institute,

    No doubt about it.

    The coup d’etat has been successful.

    The Deep State – a.k.a. the police state, a.k.a. the military industrial complex – has taken over.

    The American system of representative government has been overthrown by a profit-driven, militaristic corporate state bent on total control and global domination through the imposition of martial law here at home and by fomenting wars abroad.

    When in doubt, follow the money trail.

    It always points the way.

    Every successive president starting with Franklin D. Roosevelt has been bought—lock, stock and barrel—and made to dance to the tune of the Deep State.

    Enter Donald Trump, the candidate who swore to drain the swamp in Washington DC.

    Instead of putting an end to the corruption, however, Trump has paved the way for lobbyists, corporations, the military industrial complex, and the Deep State to feast on the carcass of the dying American republic.

    Just recently, for instance, Trump agreed to sell Saudi Arabia more than $110 billion in military weapons.

    Meanwhile, Trump—purportedly in an effort to balance the budget in 10 years—wants to slash government funding for programs for the poor, ranging from health care and food stamps to student loans and disability payments.

    The military doesn’t have to worry about tightening its belt, however. No, the military’s budget—with its trillion dollar wars, its $125 billion in administrative waste, and its contractor-driven price gouging that hits the American taxpayer where it hurts the most—will continue to grow, thanks to Trump.

    This is how you keep the Deep State in power.

    The rich will get richer, the poor will get poorer, the military will get more militaristic, America’s endless wars will get more endless, and the prospect of peace will grow ever dimmer.

    As for the terrorists, they will keep on being played for pawns as long as Saudi Arabia remains their breeding ground and America remains the source of their weapons, training and know-how.

    Follow the money.  It always points the way.

    As Bertram Gross noted in Friendly Fascism: The New Face of Power in America,evil now wears a friendlier face than ever before in American history.”

    Writing in 1980, Gross predicted a future in which he saw:

    …a new despotism creeping slowly across America. Faceless oligarchs sit at command posts of a corporate-government complex that has been slowly evolving over many decades. In efforts to enlarge their own powers and privileges, they are willing to have others suffer the intended or unintended consequences of their institutional or personal greed. For Americans, these consequences include chronic inflation, recurring recession, open and hidden unemployment, the poisoning of air, water, soil and bodies, and, more important, the subversion of our constitution. More broadly, consequences include widespread intervention in international politics through economic manipulation, covert action, or military invasion

    We’ve been losing our freedoms so incrementally for so long—sold to us in the name of national security and global peace, maintained by way of martial law disguised as law and order, and enforced by a standing army of militarized police and a political elite determined to maintain their powers at all costs—that it’s hard to pinpoint exactly when it all started going downhill, but we’re certainly on that downward trajectory now, and things are moving fast.

    The “government of the people, by the people, for the people” has perished.

    It will not be revived or restored without a true revolution of values and a people’s rebellion the likes of which we may not see for a very long time.

    America is a profitable business interest for a very select few, and war—wars waged abroad against shadowy enemies and wars waged at home against the American people—has become the Deep State’s primary means of income.

    After all, war is big business.

    In order to maintain a profit margin, one would either have to find new enemies abroad or focus on fighting a war at home, against the American people, and that’s exactly what we’re dealing with today.

    • Local police transformed into a standing army in the American homeland through millions of dollars’ worth of grants to local police agencies for military weapons, vehicles, training and assistance.
    • The citizenry taught to fear and distrust each other and to welcome the trappings of the police state.

    Had the government tried to ram such a state of affairs down our throats suddenly, it might have had a rebellion on its hands. Instead, the American people have been given the boiling frog treatment, immersed in water that slowly is heated up—degree by degree—so that they’ve fail to notice that they’re being trapped and cooked and killed.

    “We the people” are in hot water now.

    As I make clear in my book Battlefield America: The War on the American People, the Constitution doesn’t stand a chance against a federalized, globalized standing army protected by legislative, judicial and executive branches that are all on the same side, no matter what political views they subscribe to: suffice it to say, they are not on our side or the side of freedom.

    From Clinton to Bush, then Obama and now Trump, it’s as if we’ve been caught in a time loop, forced to re-live the same thing over and over again: the same assaults on our freedoms, the same disregard for the rule of law, the same subservience to the Deep State, and the same corrupt, self-serving government that exists only to amass power, enrich its shareholders and ensure its continued domination.

    The republic has fallen to fascism with a smile.

    Elections will not save us.

    Learn the treacherous lessons of 2008 and 2016:  presidential elections have made a mockery of our constitutional system of government, suggesting that our votes can make a difference when, in fact, they merely serve to maintain the status quo.

    Don’t delay.

    Start now—in your own communities, in your schools, at your city council meetings, in newspaper editorials, at protests—by pushing back against laws that are unjust, police departments that overreach, politicians that don’t listen to their constituents, and a system of government that grows more tyrannical by the day.

    If you wait until 2020 to rescue our republic from the clutches of the Deep State, it will be too late.

  • Here Are The 66 Programs That Trump's Budget Eliminates

    President Trump's fiscal 2018 budget proposal would completely eliminate 66 federal programs, for a savings of $26.7 billion. 

    As The Hill reports, some of the programs would receive funding for 2018 as part of a phasing-out plan.

    Here are the programs the administration wants on the chopping block…

    Agriculture Department — $855 million

    • McGovern-Dole International Food for Education
    • Business-Cooperative Service
    • Rural Water and Waste Disposal Program Account
    • Single Family Housing Direct Loans

    Commerce Department — $633 million

    • Economic Development Administration
    • Manufacturing Extension Partnership
    • Minority Business Development Agency
    • National Oceanic and Atmospheric Administration Grants and Education

    Education Department — $4.976 billion

    • 21st Century Community Learning Centers
    • Comprehensive Literacy Development Grants
    • Federal Supplemental Educational Opportunity Grants
    • Impact Aid Payments for Federal Property
    • International Education
    • Strengthening Institutions
    • Student Support and Academic Enrichment Grants
    • Supporting Effective Instruction State Grants
    • Teacher Quality Partnership

    Energy Department — $398 million

    • Advanced Research Projects Agency—Energy
    • Advanced Technology Vehicle Manufacturing Loan Program and Title 17 Innovative Technology Loan Guarantee Program
    • Mixed Oxide Fuel Fabrication Facility

    Health and Human Services — $4.834 billion

    • Agency for Healthcare Research and Quality
    • Community Services Block Grant
    • Health Professions and Nursing Training Programs
    • Low Income Home Energy Assistance Program

    Homeland Security — $235 million

    • Flood Hazard Mapping and Risk Analysis Program
    • Transportation Security Administration Law Enforcement Grants

    Housing and Urban Development — $4.123 billion

    • Choice Neighborhoods
    • Community Development Block
    • HOME Investment Partnerships Program
    • Self-Help and Assisted Homeownership Opportunity Program Account

    Interior Department — $122 million

    • Abandoned Mine Land Grants
    • Heritage Partnership Program
    • National Wildlife Refuge Fund

    Justice Department — $210 million

    • State Criminal Alien Assistance Program

    Labor Department — $527 million

    • Migrant and Seasonal Farmworker Training
    • OSHA Training Grants
    • Senior Community Service Employment Program

    State Department and USAID — $4.256 billion

    • Development Assistance

    Earmarked Appropriations for Non-Profit Organizations

    • The Asia Foundation
    • East-West Center
    • P.L. 480 Title II Food Aid

    State Department, USAID, and Treasury Department — $1.59 billion

    • Green Climate Fund and Global Climate Change Initiative

    Transportation Department — $499 million

    • National Infrastructure Investments (TIGER)

    Treasury Department — $43 million

    Global Agriculture and Food Security Program

    Environmental Protection Agency — $493 million

    • Energy Star and Voluntary Climate Programs
    • Geographic Programs

    National Aeronautics and Space Administration — $269 million

    • Five Earth Science Missions
    • Office of Education

    Other Independent Agencies — $2.683 billion

    • Chemical Safety Board
    • Corporation for National and Community Service
    • Corporation for Public Broadcasting
    • Institute of Museum and Library Services

    International Development Foundations

    • African Development Foundation
    • Inter-American Foundation
    • Legal Services Corporation
    • National Endowment for the Arts
    • National Endowment for the Humanities
    • Neighborhood Reinvestment Corporation
    • Overseas Private Investment Corporation

    Regional Commissions

    • Appalachian Regional Commission
    • Delta Regional Authority
    • Denali Commission
    • Northern Border Regional Commission
    • U.S. Institute of Peace
    • U.S. Trade and Development Agency
    • Woodrow Wilson International Center for Scholars

  • Ron Paul On The Drug War: Will The Trump Administration OD On Authoritarianism?

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

    Last week Attorney General Jeff Sessions ordered federal prosecutors in drug cases to seek the maximum penalty authorized by federal mandatory minimum sentencing laws. Sessions’ order represents a setback to the progress made toward restoring compassion and common sense to the sentencing process over the past few years. Sessions’ action also guarantees that many nonviolent drug law offenders will continue spending more time in prison than murderers.

    Sessions’ support for mandatory minimums is no surprise, as he has a history of fanatical devotion to the drug war. Sessions’ pro-drug war stance is at odds with the reality of the drug war’s failure. Over forty years after President Nixon declared war on drugs, the government cannot even keep drugs out of prisons!

    As was the case with alcohol prohibition, the drug war has empowered criminal gangs and even terrorists to take advantage of the opportunity presented by prohibition to profit by meeting the continued demand for drugs. Drug prohibition enables these criminal enterprises to make profits far above the potential profits if drugs where legalized. Ironically, the so-called “law-and-order” politicians who support the drug war are helping enrich the very criminals they claim to oppose!

    The war on drugs also makes street drugs more lethal by incentivizing the creation of more potent and, thus, more dangerous drugs. Of course, even as Sessions himself admits, the war on drugs also leads to increased violence, as drug dealers cannot go to the courts to settle disputes among themselves or with their customers.

    Before 9/11, the war on drugs was the go-to excuse used to justify new infringements on liberty. For example, laws limiting our ability to withdraw, or even carry, large sums of cash and laws authorizing civil asset forfeiture were justified by the need to crack down on drug dealers and users. The war on drugs is also the root cause of the criminal justice system’s disparate treatment of minorities and the militarization of local police.

    The war on drugs is a war on the Constitution as well. The Constitution does not give the federal government authority to regulate, much less ban, drugs. People who doubt this should ask themselves why it was necessary to amend the Constitution to allow the federal government to criminalize drinking alcohol but not necessary to amend the Constitution to criminalize drug use.

    Today, a majority of states have legalized medical marijuana, and a growing number are legalizing recreational marijuana use. Enforcement of federal laws outlawing marijuana in those states is the type of federal interference with state laws that conservatives usually oppose. Hopefully, in this area the Trump administration will exercise restraint and respect state marijuana laws.

    Sessions’ announcement was not the only pro-drug war announcement made by the administration this week. President Trump himself, in a meeting with the president of Columbia, promised to continue US intervention in South and Central America to eliminate drug cartels. President Trump, like his attorney general, seems to not understand that the rise of foreign drug cartels, like the rise of domestic drug gangs, is a consequence of US drug policy.

    The use of government force to stop adults from putting certain substances into their bodies – whether marijuana, saturated fats, or raw milk – violates the nonaggression principle that is the bedrock of a free society. Therefore, all those who care about protecting individual liberty and limiting government power should support ending the drug war. Those with moral objections to drug use should realize that education and persuasion, carried out through voluntary institutions like churches and schools, is a more moral and effective way to discourage drug use than relying on government force.

  • Why China's Strategic Petroleum Reserve Is All That Matters For OPEC

    When OPEC sits down on Thursday, keeping the price of Brent above $50 (to avoid a budget catastrophe and social upheaval in Saudi Arabia) and below $60 (to prevent US production from going exponential), will be just one problem the cartel nations and various hangers-on will be desperate to solve. A much bigger one, literally, is the problem that led to this week’s OPEC meeting in the first place, and years of headache for OPEC and non-OPEC nations: a record global oil inventory glut.

    The supply glut that began in mid-2014 has dumped almost one billion barrels of petroleum into global inventories. However, of this only 35–45% has ended up in transparent OECD tanks. For OPEC, that is all the matters – in the past, OPEC oil ministers have repeatedly referenced the level of OECD petroleum inventories relative to their five-year average as a gauge of the rebalancing. And, as ScotiaBank notes, those inventories were more than 280 Mbbl above their five-year average as of January and, while European stocks have been falling into a healthier range, the same cannot be said of industry stocks in the US, which despite declining for several weeks, are just below all time highs.

    But forget OECD: an increasingly greater concern for OPEC is not the less than a third of above ground oil held in developed nations; it is the rest that is the big challenge. As ScotiaBank’s Rory Johnston points out in the following chart, the majority of the remainder was absorbed by China’s vast and growing strategic petroleum reserve (SPR), which means that “the lion’s share of functional—and thus needing to draw from an OPEC perspective—industry inventories remain in the OECD, and specifically in the US (chart 3).”

    As we have explained on several occasions over the past year, China’s SPR is far more important to the global oil (im)balance and inventory glut than the less than a third of total oil produced since the summer of 2014 and stored. This is due to one main reason: while ScotiaBank is correct that any draws will likely come from OECD storage, it forgets the demand side of the equation.

     


    Storage tanks in China’s strategic oil reserve complex in Zhoushan

    One year ago, JPMorgan estimated that the daily build of China’s SPR, had grown at a breakneck pace, from 491Kbpd average in 2015 to a record 1.191MMbpd in 2016 through May, equivalent to roughly 15% of the country’s total crude oil imports.

    More importantly, it was roughly a year ago when JPM calculated that China’s SPR was getting dangerously close to its estimated capacity, just over 500 million barrels.

    JPM also made a forecast that based on its assumptions, Chinese oil imports would slide by roughly the amount that would have been going into the SPR starting in late 2016 as the reserve hit capacity. When that did not happen, there was much confusion among the commodity space, until in late September 2011, satellite imagery from Orbital Insight revealed that the total size of China’s SPR was vastly greater than previously estimated.

    According to satellite images by  geospatial analytics startup Orbital Insight, China, has not only misrepresented how much oil it has stored, it has done so at a massive scale, with the real number dwarfing even JPM own estimate: the real amount of Chinese oil in storage, according to Orbital, was a whopping 600 million barrels as of May. Assuming JPM’s estimated rate of SPR accumulation of about 1mmbpd, the 600 million number as of May would have grown to well over 700 million barrels as of September. 

     

    Orbital’s figure as first reported by Bloomberg, is well over two times larger than China’s official estimates for strategic petroleum reserves and for commercial stocks, said Orbital Chief Executive Officer James Crawford.

    To be sure, in late 2016 other skeptics started warning that even with the revised size estimates, China’s SPR was likely approaching capacity. Last September, the IEA warned that “recent pillars of demand growth China and India are wobbling.” S&P Global Platts’ Ernsberger, cited by CNBC, said that the slowdown in Chinese demand was worrying for major oil producers.

    “The demand picture is very unsettling for OPEC and for all producers of crude and refined products (and this is seen most significantly in) the slowdown in growth in the Chinese market. China has returned more incremental demand for the oil market in the last five years than any other country in the world and more than almost any of the counties combine. But this year demand growth in China has stalled and that represents a significant change in the environment for producers both in OPEC and outside it.”

    Then 2016 came and went, and we find ourselves almost mid-way into 2017 and ask: has anything finally changed, and will all those predictions of an imminent Chinese SPR overflow finally prove accurate?

    We don’t know just yet, but according to data released by the General Administration of Customs data on Tuesday, China’s oil stockpiling pace finally tumbled to 1.36mbpd in April, from 1.6mbpd in March, the sharpest decline in reserve accumulation in years, and in line with the recent slowdown from record oil imports. If indeed China is finally at capacity for the SPR, the SPR stocpiling is about to fall off as cliff this month.

    In other words, all those forecasts that China’s SPR is almost full appear to be finally coming true, and at the worst possible time for OPEC, because if suddenly over 1 million in daily “demand” is pulled from the market, OPEC will suddenly find themselves with another huge glut now that Beijing is no longer waving it in. In fact, we contend that while OPEC’s decision on Thursday is fully priced in by the market, the only thing that matters for the future price of oil is how long until China halts SPR imports. Here, those who have faster access to commercial satellite imagery will be a distinct advantage over everybody else, even the momentum-chasing, headline scanning algos…

  • US Journalism's New "Golden Age"?

    The Washington Post and other big media are hailing a new journalistic “golden age” as they punish President Trump for disparaging them, but is this media bias a sign of good journalism or itself a scandal, asks Robert Parry, via ConsotriumNews.com…

    The mainstream U.S. media is congratulating itself on its courageous defiance of President Trump and its hard-hitting condemnations of Russia, but the press seems to have forgotten that its proper role within the U.S. democratic structure is not to slant stories one way or another but to provide objective information for the American people.

    The Washington Post building in downtown Washington, D.C. (Photo credit: Washington Post)

    By that standard – of respecting that the people are the nation’s true sovereigns – the mainstream media is failing again. Indeed, the chasm between what America’s elites are thinking these days and what many working-class Americans are feeling is underscored by the high-fiving that’s going on inside the elite mainstream news media, which is celebrating its Trump- and Russia-bashing as the “new golden age of American journalism.”

    The New York Times and The Washington Post, in particular, view themselves as embattled victims of a tyrannical abuser. The Times presents itself as the brave guardian of “truth” and the Post added a new slogan: “Democracy dies in darkness.” In doing so, they have moved beyond the normal constraints of professional, objective journalism into political advocacy – and they are deeply proud of themselves.

    In a Sunday column entitled “How Trump inspired a golden age,” Washington Post columnist Dana Milbank wrote that Trump “took on the institution of a free press – and it fought back. Trump came to office after intimidating publishers, barring journalists from covering him and threatening to rewrite press laws, and he has sought to discredit the ‘fake news’ media at every chance. Instead, he wound up inspiring a new golden age in American journalism.

    “Trump provoked the extraordinary work of reporters on the intelligence, justice and national security beats, who blew wide open the Russia election scandal, the contacts between Russia and top Trump officials, and interference by Trump in the FBI investigation. Last week’s appointment of a special prosecutor – a crucial check on a president who lacks self-restraint – is a direct result of their work.”

    Journalism or Hatchet Job?

    But has this journalism been professional or has it been a hatchet job? Are we seeing a new “golden age” of journalism or a McCarthyistic lynch mob operating on behalf of elites who disdain the U.S. constitutional process for electing American presidents?

    Director of National Intelligence James Clapper (right) talks with President Barack Obama in the Oval Office, with John Brennan and other national security aides present. (Photo credit: Office of Director of National Intelligence)

    For one thing, you might have thought that professional journalists would have demanded proof about the predicate for this burgeoning “scandal” – whether the Russians really did “hack” into emails of the Democratic National Committee and Hillary Clinton campaign chairman John Podesta and then slip the information to WikiLeaks to influence the outcome of the 2016 election.

    You have surely heard and read endlessly that this conclusion about Russia’s skulduggery was the “consensus view of the 17 U.S. intelligence agencies” and thus only some crazy conspiracy theorist would doubt its accuracy even if no specific evidence was evinced to support the accusation.

    But that repeated assertion is not true. There was no National Intelligence Estimate (or NIE) that would compile the views of the 17 intelligence agencies. Instead, as President Obama’s Director of National Intelligence James Clapper testified before a Senate Judiciary subcommittee on May 8, the Russia-hacking claim came from a “special intelligence community assessment” (or ICA) produced by selected analysts from the Central Intelligence Agency, National Security Agency and Federal Bureau of Investigation, or as Clapper put it, “a coordinated product from three agencies – CIA, NSA, and the FBI – not all 17 components of the intelligence community.”

    Further, as Clapper explained, the “ICA” was something of a rush job beginning on President Obama’s instructions “in early December” and completed by Jan. 6, in other words, a month or less.

    Clapper continued: “The two dozen or so analysts for this task were hand-picked, seasoned experts from each of the contributing agencies.” However, as any intelligence expert will tell you, if you “hand-pick” the analysts, you are really hand-picking the conclusion.

    You can say the analysts worked independently but their selection, as advocates for one position or another, could itself dictate the outcome. If the analysts were hardliners on Russia or hated Trump, they could be expected to deliver the conclusion that Obama and Clapper wanted, i.e., challenging the legitimacy of Trump’s election and blaming Russia.

    The point of having a more substantive NIE is that it taps into a much broader network of U.S. intelligence analysts who have the right to insert dissents to the dominant opinions. So, for instance, when President George W. Bush belatedly ordered an NIE regarding Iraq’s WMD in 2002, some analysts – especially at the State Department – inserted dissents (although they were expunged from the declassified version given to the American people to justify the 2003 invasion of Iraq).

    An Embarrassing Product

    Obama’s “ICA,” which was released on Jan. 6, was a piece of work that embarrassed many former U.S. intelligence analysts. It was a one-sided argument that lacked any specific evidence to support its findings. Its key point was that Russian President Vladimir Putin had a motive to authorize an information operation to help Hillary Clinton’s rival, Donald Trump, because Putin disdained her work as Secretary of State.

    Russian President Vladimir Putin addresses UN General Assembly on Sept. 28, 2015. (UN Photo)

    But the Jan. 6 report failed to include the counter-argument to that cui bono assertion, that it would be an extraordinary risk for Putin to release information to hurt Clinton when she was the overwhelming favorite to win the presidency. Given the NSA’s electronic-interception capabilities, Putin would have to assume that any such undertaking would be picked up by U.S. intelligence and that he would likely be facing a vengeful new U.S. president on Jan. 20.

    While it’s possible that Putin still took the risk – despite the daunting odds against a Trump victory – a balanced intelligence assessment would have included such contrary arguments. Instead, the report had the look of a prosecutor’s brief albeit without actual evidence pointing to the guilt of the accused.

    Further, the report repeatedly used the word “assesses” – rather than “proves” or “establishes” – and the terminology is important because, in intelligence-world-speak, “assesses” often means “guesses.” The report admits as much, saying, “Judgments are not intended to imply that we have proof that shows something to be a fact. Assessments are based on collected information, which is often incomplete or fragmentary, as well as logic, argumentation, and precedents.”

    In other words, the predicate for the entire Russia-gate scandal, which may now lead to the impeachment of a U.S. president and thus the negation of the Constitution’s electoral process, is based partly on a lie – i.e., the claim that the assessment comes from all 17 U.S. intelligence agencies – and partly on evidence-free speculation by a group of “hand-picked” analysts, chosen by Obama’s intelligence chiefs.

    Yet, the mainstream U.S. news media has neither corrected the false assertion about the 17 intelligence agencies nor demanded that actual evidence be made public to support the key allegation that Russia was the source of WikiLeaks’ email dumps.

    By the way, both Russia and WikiLeaks deny that Russia was the source, although it is certainly possible that the Russian government would lie and that WikiLeaks might not know where the two batches of Democratic emails originated.

    A True ‘Golden Age’?

    Yet, one might think that the new “golden age of American journalism” would want to establish a firm foundation for its self-admiring reporting on Russia-gate. You might think, too, that these esteemed MSM reporters would show some professional skepticism toward dubious claims being fed to them by the Obama administration’s intelligence appointees.

    President Donald Trump being sworn in on Jan. 20, 2017. (Screen shot from Whitehouse.gov)

    That is unless, of course, the major U.S. news organizations are not abiding by journalistic principles, but rather see themselves as combatants in the anti-Trump “resistance.” In other words, if they are behaving less as a Fourth Estate and more as a well-dressed mob determined to drag the interloper, Trump, from the White House.

    The mainstream U.S. media’s bias against Putin and Russia also oozes from every pore of the Times’ and Post’s reporting from Moscow. For instance, the Times’ article on Putin’s comments about supposed secrets that Trump shared with Russian Foreign Minister Sergey Lavrov at the White House had the headline in the print editions: “Putin Butts In to Claim There Were No Secrets…” The article by Andrew Higgins then describes Putin “asserting himself with his customary disruptive panache” and “seizing on foreign crises to make Russia’s voice heard.”

    Clearly, we are all supposed to hate and ridicule Vladimir Putin. He is being demonized as the new “enemy” in much the way that George Orwell foresaw in his dystopian novel, 1984. Yet, what is perhaps most troubling is that the major U.S. news outlets, which played instrumental roles in demonizing leaders of Iraq, Syria and Libya, believe they are engaged in some “golden age” journalism, rather than writing propaganda.

    Contempt for Trump

    Yes, I realize that many good people want to see Trump removed from office because of his destructive policies and his buffoonish behavior – and many are eager to use the new bête noire, Russia, as the excuse to do it. But that still does not make it right for the U.S. news media to abandon its professional responsibilities in favor of a political agenda.

    The run-down PIX Theatre sign reads “Vote Trump” on Main Street in Sleepy Eye, Minnesota. July 15, 2016. (Photo by Tony Webster Flickr)

    On a political level, it may not even be a good idea for Democrats and progressives who seem to be following the failed strategy of Hillary Clinton’s campaign in seeking to demonize Trump rather than figuring out how to speak to the white working-class people who voted for him, many out of fear over their economic vulnerability and others out of anger over how Clinton dismissed many of them as “deplorables.”

    And, by the way, if anyone thinks that whatever the Russians may have done damaged Clinton’s chances more than her colorful phrase disdaining millions of working-class people who understandably feel left behind by neo-liberal economics, you may want to enroll in a Politics 101 course. The last thing a competent politician does is utter a memorable insult that will rally the opposition.

    In conversations that I’ve had recently with Trump voters, they complain that Clinton and the Democrats weren’t even bothering to listen to them or to talk to them. These voters were less enamored of Trump than they were conceded to Trump by the Clinton campaign. These voters also are not impressed by the endless Trump- and Russia-bashing from The New York Times, The Washington Post, CNN and MSNBC, which they see as instruments of the elites.

    The political danger for national Democrats and many progressives is that mocking Trump and thus further insulting his supporters only extends the losing Clinton strategy and cements the image of Democrats as know-it-all elitists. Thus, the Democrats risk losing a key segment of the U.S. electorate for a generation.

    Not only could that deny the Democrats a congressional majority for the foreseeable future, but it might even get Trump a second term.

  • Legendary Investor Asher Edelman Says "I Have No Doubt" PPT Behind Market Rally

    Legendary vulture investor Asher Edelman, the 1980s model for Gordon Gekko, strayed into what must’ve been uncomfortable territory for CNBC during an appearance on “Smart Money” when he discussed his view that the government’s “plunge protection team” is the only thing propping up the current market rally, and said he suspects that it has again been recently een intervening in the market to keep stocks at record highs.

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    Edelman simply notes that he doesn’t want to be in the markets right now because “I don’t know when the plug is going to be pulled.”

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    Few can explain the market’s recent resilience, holding near record highs despite weak economic data and intensifying geopolitical tensions. The main benchmarks have risen for the fourth straight day following last week’s “Trump Dump” despite a terror attack in the U.K., the worst soft economic data since February 2016, and surprisingly low trading volume.

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    The “plunge protection team” was created by President Ronald Reagan one year after the stock market crash in 1987, when the president called for the creation of the “Working Group on Financial Markets.”

    It’s believed – as the name would suggest and as has been profiled on countless occasions on this website previously – that the group’s mandate is to maintain stability in the market and head off any severe crashes like what was seen in 1987. It’s believed the group reports only to the president, though the head of the Treasury, head of the Securities and Exchange Commission and Federal Reserve Chairman are also involved. The team, according to Asher, steps in to execute trades on all exchanges when the market isn’t behaving as it would like, working only with big banks like Goldman Sachs Group and Morgan Stanley. 

    “We have seen the most extraordinary lack of volatility in the VIX since Trump has been in office and it’s interesting the night he was elected you may recall the futures came down about 400 or 600 points.

     

    You may also recall that the next morning they were even again. Watching plunge protection for years, I had no doubt that’s what happened.

    That may have been the case in the 1980s, however in recent years the PPT is the collaboration of the NY Fed and Citadel, which are most aggressive during times of substantial market stress and selling, when intervention is needed to stop the downward momentum in prices.

    Edelman says he believes one sign of TPP intervention is when a smaller, less-liquid stock suddenly rises late in the trading day.

    We’ve noted in the past that there appears to be a rule against mentioning the team on CNBC – with guests routinely getting “Schiff’d” for doing so.

    And once again, this time, the “theory” was treated with derision by his fellow hosts.

    “I think we all have so many questions here I don’t think I know where to begin,” Fast Money host Melissa Lee said.

    Some audience members were more enthusiastic.

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Today’s News 23rd May 2017

  • Visualizing The Rise Of Young Asylum Seekers In Europe

    As highlighted in today's UNICEF report 'A Child is a Child', the number of young children applying for asylum in Europe has continued to rise, reaching a new peak last year.

    Infographic: The Rise of Young Asylum Seekers in Europe | Statista

    You will find more statistics at Statista

    As Statista's Martin Armstrong notes, according to figures from Eurostat, there were almost 290,000 first time applicants in 2016 that were under the age of 14.  Of all child asylum seekers in Europe, 170,000 were not accompanied by an adult in 2015-2016. In fact, 92 percent of all minors arriving in Italy by sea in 2016 and the first months of 2017 were unaccompanied. Globally, children account for around 28 percent of all trafficking victims.

    We are unsure how many of these children were in attendance at last night's Ariana Grande concert suicide bombing…

  • Shaping The Future: Moscow And Beijing's Multipolar World Order

    Authored by Federico Pieraccini via The Stratgic Culture Foundation,

    Once in a while, think tanks such as the Brookings Institute are able to deal with highly strategic and current issues. Often, the conferences held by such organizations are based on false pretences and copious banality, the sole intention being to undermine and downplay the efforts of strategic opponents of the US. Recently, the Brookings Institute's International Strategy and Strategy Project held a lecture on May 9, 2017 where it invited Bobo Lo, an analyst at Lowy Institute for International Policy, to speak. The topic of the subject, extremely interesting to the author and mentioned in the past, is the strategic partnership between China and Russia.

    The main assumption Bobo Lo starts with to define relations between Moscow and Beijing is that the two countries base their collaboration on convenience and a convergence of interests rather than on an alliance. He goes on to say that the major frictions in the relationship concern the fate that Putin and Xi hold for Europe, in particular for the European Union, in addition to differences of opinions surrounding the Chinese role in the Pacific. In the first case, Lo states that Russia wants to end the European project while China hopes for a strong and prosperous Europe. With regard to the situation in the Pacific, according to this report, Moscow wants a balance of power between powers without hegemonic domination being transferred from Washington to Beijing.

    The only merit in Lo’s analysis is his identification of the United States as the major cause of the strategic proximity between Moscow and Beijing, certainly a hypothesis that is little questioned by US policy makers. Lo believes Washington's obsession with China-Russia cooperation is counterproductive, though he also believes that the United States doesn’t actually possess capabilities to sabotage or delimit the many areas of cooperation between Beijing and Moscow.

    What is missing in Lo’s analysis are two essential factors governing how Moscow and Beijing have structured their relationship. China and Russia have different tasks in ushering in their world order, namely, by preserving global stability through military and economic means. Their overall relationship of mutual cooperation goes beyond the region of Eurasia and focuses on the whole process of a sustainable globalization as well as on how to create an environment where everyone can prosper in a viable and sustainable way. Doing this entails a departure from the current belligerent and chaotic unipolar world order.

    Moscow and Beijing: Security and Economy

    Beijing has been the world's economic engine for over two decades and shows no signs of slowing down, at least not too much. Moscow, contrary to western media propaganda, has returned to play a role not only on a regional scale but as a global power. Both of these paths of military and economic growth for China and Russia have set things on a collision course with the United States, the current global superpower that tends to dominate international relations with economic, political and military bullying thanks to a complicit media and corrupt politicians.

    In the case of Beijing, the process of globalization has immensely enhanced the country, allowing the Asian giant to become the world's factory, enabling Western countries to outsource to low-cost labor. In this process of economic growth, Beijing has over the years gone from being a simple paradise for low-cost outsourcing for private companies to being a global leader in investment and long-term projects. The dividends of years of wealth accumulation at the expense of Western nations has allowed Beijing to be more than just a strategic partner for other nations. China drives the process of globalization, as recently pointed out by Xi Jinping in Davos in a historic speech. China's transition from a harmless partner of the West to regional power with enormous foreign economic investments place the country on a collision course with Washington. Inevitably, Beijing will become the Asian hegemon, something US policymakers have always guaranteed will not be tolerated.

    The danger Washington sees is that of China emerging as a regional superpower that will call the shots in the Pacific, the most important region of the planet. The United States has many vested interests in the region and undeniably sees its future as the leader of the world order in jeopardy. Obama's pivot to Asia was precisely for the purposes of containing China and limiting its economic power so as to attenuate Beijing’s ambitions.

    Unsurprisingly, Washington's concerns with Moscow relate to its resurgence in military capabilities. Russia is able to oppose certain objectives of the United States (see Ukraine or Syria) by military means. The possibility of the Kremlin limiting American influence in Eastern Europe, the Middle East and Eurasia in general is cause for concern for American policy makers, who continue to fail to contain Russia and limit Moscow’s spheres of influence.

    In this context, the strategic division of labor between Russia and China comes into play to ensure the stability of the Eurasian region as a whole; in Asia, in the Middle East and in Europe. To succeed in this task, Moscow has mainly assumed the military burden, shared with other friendly nations belonging to the affected areas. In the Middle East, for example, Tehran's partnership with Moscow is viewed positively by Beijing, given its intention to stabilize the region and to eradicate the problem of terrorism, something about which nations like China and Russia are particularly concerned.

    The influence of Islamist extremists in the Caucasian regions in Russia or in the autonomous region of Xinjiang in China are something that both Putin and Xi are aware can be exploited by opposing Western countries. In North Africa, Egypt has signed several contracts for the purchase of military vehicles from Moscow, as well as having bought the two Mistral ships from France, thereby relying on military supplies from Moscow. It is therefore not surprising that Moscow and Egypt cooperated with the situation in Libya and in North Africa in general.

    In Southeast Asia, Moscow seeks to coordinate efforts to reach an agreement between Afghanistan, Pakistan and India. The entry into the Shanghai Cooperation Organization (SCO) of New Delhi and Islamabad (Tehran will be next), with the blessing of Beijing as the protagonist of the 2017 SCO meeting, is a keystone achievement and the right prism through which to observe the evolution of the region. Moscow is essentially acting as a mediator between the parties and is also able to engage with India in spite of the dominating presence of China. The ultimate goal of Moscow and Beijing is to eradicate the terrorist phenomenon in the Asian region with a view to what is happening in North Africa and the Middle East with Iran and Egypt.

    Heading to a Multipolar World Order

    The turning point in relations between Moscow and Beijing concerns the ability to engage third countries in military or economic ways, depending on these countries’ needs and objectives. Clearly in the military field it is Moscow that is leading, with arms sold to current and future partners and security cooperation (such as with ex-Soviet Central-Asian republics or in the Donbass) and targeted interventions if needed, as in Syria. Beijing, on the other hand, acts in a different way, focusing on the economic arena, in particular with the Asian Infrastructure Investment Bank (AIIB) at its center.

    Initiatives such as the One Belt One Road (OBOR) and the Maritime Silk Road have the same strategic aim of the Russian military initiative, namely, ensuring the independence of the region from a geo-economic perspective, reaching win-win arrangements for all partners involved. Naturally, the win-win agreement does not mean that China wins and then wins again; rather, a series of bilateral concessions can come to satisfy all actors involved. An important example in this regard that explains the Sino-Russian partnership concerns the integration of the Eurasian Union with the Chinese Silk Road. The Russian concerns over the predominant status of the Chinese colossus in Central Asia have been assuaged by a number of solutions, such as the support of the OBOR infrastructure program to that of the Eurasian Union. Beijing is not interested in replacing Moscow's leading role the post-Soviet nations in Central Asia but rather with providing significant energy and economic development to particularly underdeveloped nations that are in need of important economic investment, something only Beijing is able to guarantee.

    The linking of the Eurasian Economic Union (EEU) with the One Belt One Road initiative guarantees Moscow a primary role in the transit of goods from east to west, thereby becoming the connecting point between China and Europe while expanding the role and function of the EEU. All participants in these initiatives have a unique opportunity to expand their economic condition through this whole range of connections. Beijing guarantees the money for troubled countries, and Moscow the security. The SCO will play a major role in reducing and preventing terrorist influence in the region, a prerequisite for the success of any projects. Also, the AIIB, and to some extent the BRICS Development Bank, will also have to step in and offer alternative economic guarantees to countries potentially involved in these projects, in order to free them from the existing international financial institutions.

    One Belt One Road, and all the related projects, represent a unique occasion whereby all relevant players share common goals and benefits from such transformative geo-economic relationships. This security-economy relationship between Moscow and Beijing is  the heart of the evolution of the current world order, from the unipolar to the multipolar world. The US cannot oppose China on the economic front and Russia on the military front. It all comes down to how much China and Russia can continue to provide and guarantee economic and security umbrellas for the rest of the world.

  • "Let's Burn Down The Universities"

    Authored by JC Collins via Philosophy of Metrics blog,

    An Offensive Act of Self Defence to Save the Great School of Western Thought

    It should be clear to all reasoning people with the ability for critical thinking that a pattern of cultural warfare has been unfolding against the Western world since at least the end of World War Two. The contrast between what was then and what is now is stark and frightening. It should serve as all the evidence we require to make the final determination about what has been happening.

    The complete destruction of the traditional family unit has taken place through a process of indirect and direct attacks against the proven characteristics of Western civilization. It should be obvious that media and art have orchestrated a well-thought out strategy of cultural warfare against the masculine and feminine ideals and support columns of culture.

    This strategy has attacked the natural and instinctual strengths of both men and women while promoting the weakness from within each of us as individuals. The battles of this cultural attack have been orchestrated and waged from inside the once great structures of Western thought.

    Our educational buildings and curriculums have been used to erode and shatter all the ideals of natural and instinctual existence which have developed within the Western mind. The more we remember and rediscover, the more we realize that almost everything which is taught in our schools is either a corrupt twisted version of truth, or is an outright lie and fabrication.

    If our curriculums were based on truth they would not need the constant changing and tweaking which takes takes place. Nor would it require involvement of government controls. All are tell-tale signs that something smells rotten in Denmark.

    Over the years there have been various exposé and theories surrounding everything from the Frankfurt School, the Tavistock Institute, Lucis Trust, Freemasonic control of all things, Satanism, Bilderberg, Trilateral, Rhodes, and so on and so on. The plethora of culprits and evil organizations run the gambit of all human elitism and consolidation of wealth and power.

    Not withstanding some truth to this large list of nefarious actors, and not to mention that the stated longterm goals of these groups and organizations match with the results which have been achieved since the end of the war, there is much more to the expanding collapse of Western civilization which needs to be considered.

    In the posts The Wisdom of the Ancients – Part One and How Your Brain is Turned Against You, we reviewed our own accountabilities and responsibilities alongside some of the techniques which are used against us. It should be clear that we may have to listen to the sales pitch of a huckster but it doesn’t mean we have to believe that huckster. The theme from those posts is that if we don’t plan our own lives someone else will plan it for us. This is in essence what is happening.

    We have been conditioned to follow and plan our lives along a very specific path which forces us further down into the systemic control mechanisms which have taken hold of our culture. You are left to plan your life within this strategic grid. This grid contains multiple pathways which all lead through the false teachings and methodologies which have been manufactured by those who wish to devolve and re-engineer Western civilization. The trap ensures you continue bouncing around inside the construct with an ever growing sense of confusion and hopelessness.

    Those who do not agree with the teachings of the construct are made to feel regressive and are told they are the problem in society for which the construct exists in the first place. This script is supported by all forms of media, including movies, music, social media, both mainstream and alternative media, as well as school curriculums, from the early pre-school sessions to the “advanced” learnings which are communicated and rehearsed in colleges and universities.

    Please ask yourself a question. Does it feel like our culture has been progressive? Everything that has a seed in human weakness and depravity has been promoted and expanded across the decades. Our culture is over-sexualized. We thieve and betray one another over the smallest rewards. The murder of unborn children is accepted as righteous even though it ruins the emotional spirit of the mother. Racism against anything rooted in traditional Western culture is out of control. Our children are taught at an early age about the degenerate sex world. Massive migration has undermined the Western ideals and systems of belief which have been a part of its growth and greatness for thousands of years. Alcoholism is both openly promoted and applauded through the subtle insinuations in the media. The rampant fragmentation of the family unit and a corrupt and unreliable system of law which supports that fragmentation are the greatest loss we have experienced. This is all supported by an educational system which is reducing critical thinking and dumbing down generations.

    This does not feel progressive. When we consider the stark changes which have taken place over the last eight decades we should come to the conclusion that it is in fact regressive. All of the technological advancements would still have taken place without the corruption of Western civilization, so any form of counter-argument about science and the advancement of medicine and technology being possible because of this “progressive” culture stands in opposition and denial of the leaps made during the agricultural and industrial revolutions.

    Similar lines of thought regarding colonialism and the slave trade are often made by the regressive left educational institutions and supporting media. But these arguments also stand in opposition to the truthful history of the world where we find that all cultures had forms of colonialism and slave trades are wide and diverse, with there being more slavery in the world today than at any other time in world history.

    The disease has burrowed itself so deep into our institutions that it is hard to imagine how we would remove it without completely destroying the host. But what choice to we have at this late hour? Continuing as we have been is tantamount to surrender and shackling our descendants with an unthinkable ideology of absolute sameness and collectivism.

    It’s interesting that more and more students are coming out of the university system and understanding that they in fact understand nothing. The loss of critical thinking and a cultural anchor point, both of which have been a part of the collective-socialist strategy, are now beginning to awaken more of those who have been traversing through the system. It’s almost as if nature and instinct are re-emerging from within the individual minds of the construct and attempting to establish new anchor points.

    Now is the time to act and reverse the momentum which has thus far worked against us. We need to tear down the institutions and framework of the simulated world which has built up around us. The great school of the Western mind cannot be destroyed and it will never stop learning. In fact, this challenge, the one we have been faced with now for generations, could very well end up being one of our greatest lessons and opportunities for advancement.

  • "Arbitrage Is Dead" – Commodity Traders Lament A World "Where Everyone Knows Everything"

    For commodity traders operating in the Information Age, Bloomberg reports that just good old trading doesn’t cut it anymore… "Everything is transparent, everybody knows everything and has access to information."

    Unlike the stock market in which transactions are typically based on information that’s public, firms that buy and sell raw materials thrived for decades in an opaque world where their metier relied on knowledge privy only to a few. Now, technological development, expanding sources of data, more sophisticated producers and consumers as well as transparency surrounding deals are eroding their advantage.

    Just ask Noble Group…

    At a panel discussing ‘What’s Next for Commodity Trading: Drivers, Disruptors and Opportunities’, Bloomberg reports that Sunny Verghese, the chief executive officer of food trader Olam International Ltd., lamented declining margins.

    “The consumers and producers are trying to eat our lunch. So we got to be smart about differentiating ourselves,” he said.

    As market participants’ access to information increases, the traders highlighted the need to more than simply buy and sell commodities as profits from arbitrage — or gains made from a differential in prices — shrinks. That means getting involved in the supply chain by potentially buying into infrastructure that’s key to the production and distribution of raw materials, and also providing financing for the development of such assets.

    “The most valuable commodity out there is information, and the most useful information is the proprietary, critical information that you obtain from your own supply chain,” said John Driscoll, the chief strategist at JTD Energy Services Pte, who has spent more than 30 years in the petroleum trading industry in Singapore.

     

    “You have to have skin in the game. You have to have access to assets, whether it’s infrastructure, terminals, vessels or refineries.”

    It’s critical for commodity traders to evolve as margins have declined because of more transparency and “price arbitrage has disappeared,” said Olam’s Verghese. For example, the number of price quotes published by agencies such as S&P Global Platts and Argus, which assess the value of commodities globally, have increased about 15 times since 1990, according to Verghese.

    While “arbitrage is dead,” traders will “continue to have substantial opportunity and disruption but the way of capturing that opportunity becomes more sophisticated,” Mercuria’s Jaeggi said.

  • Nigel Farage Responds to Manchester Suicide Attack: 'This is a Direct Attack on Children'

    Nigel Farage was interviewed by Tucker Carlson this evening to discuss the suicide attack in Manchester that killed at least 19 and wounded dozens.

    Farage told Carlson, “we have been lulled into a slight sense of complacency,” refraining, however, from jumping to conclusions as to who was responsible for the attack.

    He noted that Britains shouldn’t put their guard down, post BREXIT, saying “we’ve convinced ourselves that we’re in a better place than the rest of Europe on this.”

    Farage pointed out that the bombing was a ‘direct attack on children… marks a new low in all forms of terrorism.”

    Watch.

    Content originally published at iBankCoin.com

     

  • How Russia Became "Our Adversary" Again

    Authored by Paul Street via The Strategic Culture Foundation,

    Americans are routinely told by politicians and corporate media pundits and talking heads that Russia is their enemy – an “adversary state.”  The assertion has been normalized.  It passes without challenge or justification.

    Forget for now the question of whether and how “our adversary Russia” intervened significantly on Donald Trump’s behalf in the 2016 U.S. presidential election.  Put aside the glaring absence of any smoking gun evidence to back that charge up and contemplate the fundamental matter of how and why Vladimir Putin’s Russia became “our enemy” in the first place.

    For those of us old enough to remember the long Cold War era, the designation of Russia as a leading global U.S. foe carries no small irony. From the Bolshevik Revolution of 1917 until the collapse of the officially Marxist-Leninist Soviet Union and its Eastern European satellites in the early 1990s, Russia was an ideological and political enemy of the Western capitalist “elite.”

    The USSR was no workers’ paradise.  For all its formal allegiance to Marx and Engels, it was a militantly hierarchical class society ruled by a tyrannical state. After World War Two, it held brutal military power over Eastern Europe and East Germany. Still, Soviet-era Russia created an urban and industrialized society with real civilizational accomplishments (including cradle-to-grave health-care, housing, and food security and an impressive educational system and cultural apparatus) outside capitalism.  It pursued an independent path to modernity without a capitalist class, devoid of a bourgeoisie, in the name of socialism. It therefore posed a political and ideological challenge to U.S-led Western capitalism – and to Washington’s related plans for the Third World periphery, which was supposed to subordinate its developmental path to the needs of the rich nations (the U.S., Western Europe, and honorarily white Japan) of the world-capitalist core.

    Honest U.S. Cold Warriors knew that it was the political threat of “communism” – its appeal to poor nations and people (including the lower and working classes within rich/core states) – and not any serious military danger that constituted the true “Soviet menace.”  Contrary to U.S. “containment” doctrine after World War II, the ruling Soviet bureaucracy was concerned above all with keeping an iron grip on its internal and regional empire, not global expansion and “world revolution.” It did, however “deter…the worst of Western violence” (Noam Chomsky) by providing military and other assistance to Third World targets of U.S. and Western attack (including China, Korea, Indonesia, Egypt, Syria, Cuba, Vietnam, and Laos).  Along the way, it provided an example of independent development outside and against the capitalist world system advanced by the superpower headquartered in Washington.

    To make matters worse from Washington’s “Open Door” perspective, the Soviet Empire kept a vast swath of the world’s natural and human resources walled off from profitable exploitation by global capital.

    All of this was more than enough to mark the Soviet Union as global public enemy number one for the post-WWII U.S. power elite, which had truly planet-wide imperial ambitions, unlike Moscow.

    The Soviet deterrent and alternative to U.S.-led capitalism-imperialism collapsed once and for all in the early 1990s.  Washington celebrated with unchallenged invasions of Panama and Iraq. The blood-drenched U.S. President George H.W. Bush exulted that “what we say goes” in a newly unipolar, post-Soviet world. Russia reverted to not-so “free market” capitalism under U.S.-led Western financial supervision and in accord with the savage austerity and inequality imposed by the neoliberal “Washington consensus.” Chomsky got it right in 1991.  “With the collapse of Soviet tyranny,” he wrote, “much of the region can be expected to return to its traditional [subordinate] status, with the former high echelons of the bureaucracy playing the role of the Third World elites that enrich themselves while serving the interests of foreign investors.” The consequences were disastrous for many millions of ordinary Russians.

    The West said, “welcome to the machine” and “enjoy your new freedom to starve and die young.” The Soviet tyranny was turned into an oligarchs’ wonderland, a neoliberal wasteland combining untold new opulence for the fortunate Few with a stark decline in social and living standards for the Many.  Russia remains a capitalist nightmare and plutocrats’ playground.

    So, what happened?  How did “our” Cold War super-enemy become “our” brand new top “adversary” all over again, more than a quarter century after the tearing down of the Berlin Wall? The bottom line is that proud, post-Cold War Russia finally experienced too much brazen humiliation and betrayal at the hands of the U.S.-led West. It got up off the canvas under national/nationalist strongman Putin (a former KGB Lieutenant-Colonel wise in the ways of the West) and marshalled enough of still-intact natural and military resources and patriotic to challenge the American Empire’s hubristic claim to the right to rule Eurasia with impunity. “What we say goes” hit a new wall of Russian dignity and power.

    One of the many dirty little secrets of the U.S. Cold War was that anti-communism functioned as a pretext and cover for Washington’s Wall Street-fueled ambition to force open and run the entire world system in accord with its multinational corporate elite’s globalist- “Open Door” political-economic needs.  From this imperial perspective, the real Cold War enemy was not so much “communism” as other peoples’ struggles for national, local, and regional autonomy and independence. The enemy remains long after the statues of Marx, Engels, Lenin, and Stalin have come down.

    It doesn’t matter than Russia is no longer “socialist.” Nationalist and regional push-back against Uncle “We Own the World” Sam has been more than sufficient to get Putin designated as the next official Hitler and Russia targeted as a malevolent opponent by the U.S. elite political class and media. Mike Whitney puts it very well in a recent CounterPunch essay:

    “What has Russia done to deserve all the negative press and unsupported claims of criminal meddling?…Just look at a map. For the last 16 years, the US has been rampaging across North Africa, the Middle East and Central Asia. Washington intends to control critical oil and natural gas reserves in the ME, establish military bases across Central Asia, and remain the dominant player in an area of that is set to become the most populous and prosperous region of the world…”

     

    “But one country has upset that plan, blocked that plan, derailed that plan. Russia. Russia has stopped Washington’s murderous marauding and genocidal depredations in Ukraine and Syria, which is why the US foreign policy establishment is so pissed-off.  US elites aren’t used to obstacles.”

     

    “For the last quarter of a century – since the fall of the Berlin Wall and the dissolution of the Soviet Union – the world had been Washington’s oyster. If the president of the United States wanted to invade a country in the Middle East, kill a million people, and leave the place in a smoldering pile of rubble, then who could stop him? …Nobody.  Because Washington owns this fu**ing planet and everyone else is just a visitor…Capisce?.”

     

    “But now all that’s changed. Now evil Putin has thrown up a roadblock to US hegemony in Syria and Ukraine. Now Washington’s land-bridge to Central Asia has been split in two, and its plan to control vital pipeline corridors from Qatar to the EU is no longer viable. Russia has stopped Washington dead-in-its tracks and Washington is furious.”

     

    “The anti-Russia hysteria in the western media is equal to the pain the US foreign policy establishment is currently experiencing. And the reason the foreign policy establishment is in so much pain, is because they are not getting their way.  It’s that simple. Their global strategy is in a shamble because Russia will not let them topple the Syrian government, install their own puppet regime, redraw the map of the Middle East, run roughshod over international law, and tighten their grip on another battered war-torn part of the world.”

     

    “So now… Putin must be demonized and derided. The American people must be taught to hate Russia and all-things Russian…Russia must be blamed for anything and everything under the sun…”

    Forget the charges of Trump-Russia collusion.  Trump’s main Russia problem is that he came into the White House from outside the elite Council on Foreign Relations (CFR) ruling class establishment Unlike the plugged-in U.S. power and imperial elite, the orange-haired brute never got the Zbigniew Brzezinski-crafted, David Rockefeller-endorsed CFR memo on the grave peril Moscow still poses to “the international system sponsored by the United States.”  (True, it’s unlikely that Trump could have followed the memo). Candidate Trump showed his lack of ruling class credentials by admiring Putin’s authoritarian manliness and calling for a stand-down from Obama and Hillary Clinton’s reckless, Brzezinski-esque provocation of the Kremlin in Eastern Europe and Syria. He foolishly called for normalized relations with the vodka-swilling Eurasian power that arose from the grave to once again become Washington’s “all-purpose [global] punching bag” (Whitney).

    After Herr Donald was ironically installed in the White House by leading Russophobe and  “lying neoliberal warmonger” (LNW) Hillary Clinton, Russia-hating took on a new and seductive political meaning for Democrats and their many U.S. media allies. The Russiagate narrative has proved irresistible to these actors for three basic reasons.

    First, they have naturally wanted to delegitimize the early Trump administration for standard partisan reasons. They’ve seen tarring Trump as a treasonous friend of a leading “foreign adversary” as useful for that purpose.

     

    Second, highly placed NATO-expansionist New Cold Warriors in both major parties (e.g., John McCain) and the media have wanted to keep the heat on Moscow. The baseless Russia election-hacking and collusion charges have been tools for the New Cold War camp to hedge in Trump’s promises of rapprochement with Russia. The Russiagate scam is part of why Clockwork Orangutan found it necessary to absurdly tell Russia to “give Crimea back” to Ukraine and why he theatrically launched 59 cruise missiles onto a Syrian airbase.

     

    Third, the Russian interference allegation has been made in part to help the DNC and the neoliberal Democratic Party establishment avoid responsibility for blowing the 2016 election. The Democrats ran a wooden, Wall Street-captive, and corruption-tainted candidate (the aforementioned LNW) and a vapid and elitist campaign that couldn’t mobilize enough working- and lower-class voters to defeat the epically noxious and unpopular Trump in key states like Pennsylvania, Wisconsin, Florida, Michigan and Ohio. The “Moscow stole it” narrative is a fancy version of “The dog [bear?] ate my homework” for a dismal dollar-drenched Democratic Party that abandoned the working class and the causes of peace, social justice and environmental sustainability long ago.

    The “inauthentic opposition” party (as the late Sheldon Wolin aptly described the neoliberal Democratic Party) would rather not take a long, hard and honest look at what it has become. It does not want to concede anything to those who dream (naively) of turning it into an authentic peoples’ and opposition party with a bold progressive vision and agenda. The “Russia did it” charge works for establishment Democrats hoping to stave off demands from leftish-progressive-populist types in their own party.

    This perverse political logic works to sustain the strange new neo-McCarthyite anti-Russian madness, which is rooted in the U.S. imperial agenda, not any relevant Russian influence on U.S. life and politics.

  • Enron 2.0? Asia's Largest Commodity Trader Halted After Crashing To 16 Year Lows On S&P Downgrade

    Once Asia's largest commodity trader, Noble Group has been halted after crashing almost 30% this morning following S&P lowering its corporate credit rist rating to CCC+, citing continuing weak cash flows and profitability…

    "We downgraded Noble because we believe the company's capital structure is not sustainable,"

     

    "The negative outlook on Noble reflects the potential that the company will face distress and a non-payment of its debt obligations over the next 12 months,"

    This is the lowest prices for the Singapore-based firm since 2001…

     

    This has been coming for a while, as we warned a year ago… Noble's "Margin Call" Part II – The Enron Moment

    By Simon Jacques

    "Our balance sheet – the strongest in recent history – represents a significant advantage as we continue to identify high value growth opportunities across the products and geographies we operate in. Maintaining our investment grade rating with the international rating agencies is a vital part of this strategy."     

    Noble Group 2014 Annual Report, p. 27

          * * * * *

    "Moody's Investors Service has downgraded Noble Group Limited's senior unsecured bond ratings to Ba1 from Baa3 and the provisional rating on its senior unsecured MTN program to (P)Ba1 from (P)Baa3."

          – Moody's, December 29, 2015

          * * * * *

    "Noble Group Downgraded To 'BB+' On Weakened Liquidity; Notes Lowered To 'BB'; Ratings Still On CreditWatch Negative"

         – Standard & Poors, January 7, 2016

    The story of Noble is worth writing a book, mostly of how not to run your business. 

    If they are in this mess, it is in large part because the management was comprised predominantly of traders who were predisposed to defend their books.

    Noble has been desperately trying to revive their image by hiring former Goldman, JP. Morgan, Trafigura executives etc. By doing so they were looking for a form of credibility collateral.

    It didn’t work well for the new employees as they rapidly found out that they inherited from the liabilities of one decade of Noble’s poor decision making of the hard-core asset guys like William J. Randall and ex-Goldman Sach banker Yusuf Alireza.

    In the part II of this analysis we will review the gap between the liquidity headroom and the debt maturity profile of the trader and explain how Noble Group will have its Enron moment.

    The fatal mistake that Noble Group did was apparently to mislead the market about their financial performance "presumably" by using accounting devices.

    During last November, Noble Group's chief financial officer Robert van der Zalm has stepped down from his position after taking a leave of absence for “health reasons”.

    Two months later,  Moody’s downgraded Noble Group.

    In a very awaited decision, Standard & Poor’s has finally lowered Noble Group’s to junk, placing Asia’s largest commodity trader on watch for further possible as the rating agency remains skeptical about the liquidity headroom of the trader.

    According to Noble Group, on September 30th 2015, the company had  $15.5bn banking facilities and $1.669B in RMI (ready marketable inventories).

    • $11.1bn of these $15.5bn banking facilities is uncommitted and are contingent on ability of maintaining investment-grade rating in the future.
    • Noble claims to have $900M of cash and 1.669B$ in RMI (ready and marketable inventories).
    • Their 1.669B$ in RMI have claims on related- party notes that are under collateralized by their commodity merchant activity and therefore should be excluded from their liquidity headroom.
    • Noble Group currently uses $3.4B of borrowing facilities that are uncommitted.

    Noble Group is left with only 1B$ of unutilized committed borrowing facilities and $900M of cash ready available to meet $2.966B of debt scheduled in the next 12 months.

    Source: Noble Group MD&A Q-3 2015

    Moreover, Noble Group counts on the completion of the Noble Agri stake divesture to reap $750M, a transaction which may not be completed by February 2016.

    Adding the 1B$ of unused uncommitted borrowing facilities plus the $750M of Noble Agri and the $900M of cash that Noble claims to have, Noble is still short by $316M.

    With the S&P downgrade, the total collateral margin call on Noble Group could be as much as $3.4B, banking facilities that are uncommitted and contingent on the ability of maintaining their investment-grade rating.

    Noble will have its Enron Moment.

    Enron's bankruptcy occurred on November 2001 and was triggered by S&P's downgrade of its debt below investment grade, activating a call provision in some loan indentures with principal amounts totaling $4 billion, cash and liquidity that suddenly Enron didn’t have.

    After the quick sale of Noble Agri, Noble’s core business remains its coal & energy – two very depressed commodities for the foreseeable future, and with no cash-flows to pay its debt and a sudden tightening of the credit, the trader is a cancer patient on the forward curve.

  • China's Bond Market Chaos Continues – Yield Curve Double-Inverts

    China's $1.7 trillion government-bond market is turning curiouser and curiouser

    In a fresh sign of the nerves among investors caused by Beijing's campaign this spring to make Chinese markets less risky, the yield on seven-year government bonds rose to 3.79% on Monday, above the yield on both five-year and 10-year bonds.

    The highly unusual move means that China's government-bond yield curve now resembles a triangle, with the seven-year yield at its highest since October 2014. Furthermore, the Chinese curve has a double-inversion 3s to 5s and 7s to 10.

    In fact the 3s10s spread is the most negative ever…

    The shift comes less than two weeks after the government-bond yield curve became inverted for the first time on record, with 10-year yields–now at 3.65%–lower than those for five-year bonds, currently at 3.68%. Normally investors demand higher yields on bonds that have longer to go until maturity.

    Intriguingly, 30Y US Treasuries and 3Y China Treasuries have traded very tightly coupled at the same level for 6 years…

    "We are seeing a butterfly on our screen that we have never seen before, " said a Shanghai-based senior bond trader at a local mutual fund.

    The continued pressure on Chinese bonds (and stocks) is driven by both technical flows (China's ongoing crackdown on leverage in the financial system spewing out into the shadow banking system and hitting retail), and expectations for growth in a lower credit growth world (which has crushed the yield curve).

    Just last night brokerage shares slumped as Chinese authorities blocked off-'channel' operations, barring securities firms from helping banks take loans off balance sheets…

    As The Nikkei Asian Review reported, Chinese authorities have begun cracking down on brokerages engaged in the profitable business of helping banks keep inconvenient loans or assets off the books, sparking a broad slide among Shanghai-listed securities firms Monday.

    The China Securities Regulatory Commission on Friday banned so-called channel business helping banks convert on-the-books loans and notes into off-balance-sheet financial instruments, announcing the audit of an investment fund facilitating such transactions. The activities enable lenders to circumvent caps on loan-deposit ratios, for example.

    Channel business is a significant source of fee revenue for brokerages but amounts to a firm abandoning its responsibility as an asset manager, the securities commission said.

    The resulting murky wealth management products form a cornerstone of China's shadow banking system, offering investors high returns in exchange for significant risk. The country's banks handle some 29 trillion yuan ($4.21 trillion) in such products. Regulators fearing such risk factors as defaults have stepped up a crackdown on shadow banking since April.

  • Buy The F**king Brazilian Political Crisis Dip

    Nothing says "go all in" on Brazilian stocks like the one of the biggest equity market drops on record following yet another political crisis… and that's just what investors did.

    Second only to the collapse surrounding Lehman's branruptcy, EWZ (the Brazil ETF) crashed over 16% last week (before rebounding)…

    But it appears, the political crisis around President Michel Temer couldn’t have come at a better time for the U.S. exchange-traded fund that invests in Brazilian stocks. The ETF had gone more than seven weeks without any deposits as investors questioned whether the equity rally had gone too far. But the 16 percent plunge on Thursday eased those concerns, and investors added $345 million to the fund, the biggest single-day inflow since Jan. 6, 2011…

    Pent up demand?

    It seems not, as while the Real is bid, Brazilian stocks are still languishing…

    Despite headlines that Temer's court hearing had been delayed today… stocks saw no love to end down 1.5%.

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