Today’s News 4th October 2016

  • Google Says Only "White People" Can Be Racist While Confirming That "Reverse Racism DOES NOT Exist"

    Back in February, Google drew some heat when a Muslim blogger, Hind Makki, pointed out a seemingly racist “kink” in the search engine’s algorithm related to a search for “american muslims report terrorism.”  Apparently Google made the incorrect assumption that Makki meant to search for “american muslims support terrorism.”  Oops.

     

    Tosh.O even recorded an “Is Google Racist?” segment poking fun at the discovery.

     

    Now, clearly not one to shy away from tackling the tough racially-charged questions, per The Sun, Google offers the following very specific answer to the question of whether or not it is “possible to be racist to a white person”:

    Reverse Racism

     

    Just to recap before moving on, according to Google “reverse racism DOES NOT exist” because “white people have power to oppress black people because they control the system and economic structure in society.”

    Oddly, Google seems to have pulled their “facts” from a Huffington Post article entitled “4 ‘Reverse Racism’ Myths That Need To Stop” which succinctly concludes:  “Reverse racism isn’t real.  No, really.”

    Now we’re not sure about all of you, but the first “news” outlet that comes to mind when we think about hard-hitting, fact-based, impartial, investigative journalism is the Huffington Post. 

    In fact, all you have to do is take a quick look at the Huffington Post article to find that they cite some pretty “credible” sources in defense of their controversial conclusion on reverse racism. Well, on second thought it actually only seems to cite 1 “source” and it just happens to be the 2014 film, “Dear White People.” 

    Still, the film, which was described as “a biting satire of racial politics” by critics, could still be considered a credible source, right?

     

    So, just to summarize, Google offered up a “factual” answer to whether or not “reverse racism” exists in American society based on a 2014 Hollywood movie.  Seem reasonable to everyone?

    Of course, this should all come as a surprise to precisely no one as Silicon Valley has demonstrated multiple times in recent months that they’ve completely lost the ability to present impartial facts.  For example, we recently shared a post entitled “Harvard PhD Explains How Google Search Bias Could “Shift 3 Million Votes” In Upcoming Election” that systematically illustrated how Google overtly censored popular search results to the explicit benefit of Hillary Clinton by editing out potentially harmful results.  Or, there is that time that FaceBook openly admitted that it “routinely” suppressed conservative news.

    With support like that it’s shocking that the presidential polls are even as close as they are.

  • France: The Ticking Time Bomb Of Islamization

    Submitted by Yves Manou via The Gatestone Institute,

    • The last group, defined as the "Ultras", represent 28% of Muslims polled, and the most authoritarian profile. They say they prefer to live apart from Republican values. For them, Islamic values and Islamic law, or sharia, come first, before the common law of the Republic. They approve of polygamy and of wearing the niqab or the burqa.
    • "These 28% adhere to Islam in its most retrograde version, which has become for them a kind of identity. Islam is the mainstay of their revolt; and this revolt is embodied in an Islam of rupture, conspiracy theories and anti-Semitism," according to Hamid el Karoui in an interview with Journal du Dimanche.
    • More importantly, these 28% exist predominantly among the young (50% are under 25). In other words, one out of every two young French Muslims is a Salafist of the most radical type, even if he does not belong to a mosque.
    • It is unbelievable that the only tools at our disposal are inadequate opinion polls. Without knowledge, no political action — or any other action — is possible. It is a situation that immeasurably benefits aggressive political Islamists.
    • Willful blindness is the mother of the civil war to come — unless the French people choose to submit to Islam without a fight.

    Recently, two important studies about French Muslims were released in France.

    The first one, optimistically entitled, "A French Islam is Possible," was published under the auspices of Institut Montaigne, an independent French think tank.

     

    The second study, entitled, "Work, the Company and the Religious Question," is the fourth annual joint study between the Randstad Institute (a recruiting company) and the Observatory of Religious Experience at Work (Observatoire du fait religieux en entreprise, OFRE), a research company.

    Both studies, filling a huge knowledge-deficit on religious and ethnic demography, were widely reported in the media. France is a country well-equipped with demographers, scholars, professors and research institutes, but any official data or statistics based on race, origin or religion are prohibited by law.

    France has 66.6 million inhabitants, according to a report dated January 1, 2016 from the National Institute of Statistics (Insee). But census questionnaires prohibit any question about race, origin or religion. So in France, it is impossible to know how many Muslims, black people, white people, Catholics, Arabs, Jews, etc. live in the country.

    This prohibition is based on an old and once-healthy principle to avoid any discrimination in a country where "assimilation" is the rule. Assimilation, French-style, means that any foreigner who wants to live in the country has to copy the behavioral code of local population and marry a native quickly. This assimilation model worked perfectly for people of Spanish, Portuguese or Polish descent. But with Arabs and Muslims, it stopped.

    Now, however, despite all good intentions, the rule prohibiting collection of data that might lead to discrimination, has become a national security handicap.

    When any group of people, outspokenly acting on the basis of their religion or ethnicity, begin violently fighting the fundamentals of the society where you live, it becomes necessary — in fact urgent — to know what religions and ethnicities these are, and how many people they represent.

    The two studies in question, therefore, are not based on census data but on polls. The Institut Montaigne study, for example, writes that Muslims represent 5.6% of the metropolitan population of France, or exactly three million. However, Michèle Tribalat, a demographer specializing in immigration problems, wrote that the five million mark had been crossed in around 2014. The Pew Research Center estimated the Muslim population in France in mid-2010 to be 4.7 million. Other scholars, such as Azouz Begag, former Minister of Equality (he left the government in 2007) estimates the number of Muslims in France to be closer to 15 million.

    Institut Montaigne Study: The Secession of French Muslims

    The study by Institut Montaigne, released on September 18, is based on a poll conducted by Ifop (French Institute of Public Opinion), which surveyed 1,029 Muslims. The author of the study is Hakim el Karoui, a consultant who was an adviser to then Prime Minister Jean-Pierre Raffarin (2002-2005).

    Three main Muslim profiles were highlighted:

    First were the so-called "secular" (46%). These people said they were "totally secular, even when religion occupies an important place in their lives." Although they claim to be secular, many of them also belong to the group that favors all Muslim women wearing a hijab (58% of men and 70% of women). They also overlap with the group (60%) that supports wearing a hijab at school, although the hijab has been prohibited in schools since 2004. Many of these "seculars" also belong to the 70% of Muslims who "always" buy halal meat (only 6% never buy it). According to the study, wearing a hijab and eating only halal meat are considered by Muslims themselves as significant "markers" of Muslim identity.

     

    A second group of Muslims, the "Islamic Pride Group" represent a quarter (25%) of the roughly thousand people polled. They defined themselves primarily as Muslims and claim their right to observe their faith (mainly reduced to hijab and halal) in public. They reject, however, the niqab and polygamy. They say they respect secularism and the laws of the Republic, but most of them say they do not accept prohibiting the hijab at school.

     

    The last group, defined as the "Ultras", represent 28% of those polled, and the most authoritarian profile. They say they prefer to live apart from Republican values. For them, Islamic values and Islamic law, or sharia, come first, before the common law of the Republic. They approve of polygamy and of wearing the niqab or the burqa.

    "These 28% adhere to Islam in its most retrograde version, which has become for them a kind of identity. Islam is the mainstay of their revolt; and this revolt is embodied in an Islam of rupture, conspiracy theories and anti-Semitism," according to Hamid el Karoui in an interview with Journal du Dimanche.

    Hamid el Karoui, speaking of the opinions of French Muslims in an interview with Journal du Dimanche, said: "These 28% adhere to Islam in its most retrograde version, which has become for them a kind of identity. Islam is the mainstay of their revolt; and this revolt is embodied in an Islam of rupture, conspiracy theories and anti-Semitism."

    More importantly, these 28% exist predominantly among the young (50% are under 25). In other words, one out of every two young French Muslims is a Salafist of the most radical type, even if he does not belong to a mosque.

    The question is: how many will they be in five years, ten years, twenty years? It is important to ask, because polls always present a point in time, a freeze-frame of a situation. When we know that the veil and halal food restrictions are imposed on the whole family by "big brothers," we have to understand that a process is taking place, a secession process due to the re-Islamization of the whole Muslim community by the young.

    Journalist and author Elisabeth Schemla wrote in Le Figaro:

    To understand what re-Islamization means a definition of Islamism must be given. The most accurate is the definition given by one of his very fervent supporters, State Advisor Thierry Tuot, one of three judges chosen this summer to decide not to ban the burkini at the beach (…). Islamism, he writes, is the "public claim of a social behavior presented as a divine requirement and bursting into the public and political arena." In light of this definition, the Al Karoui report shows that Islamism is unalterably spreading.

    Islam at Work; Islamism on the Move

    This ticking time bomb is silently working… at work.

    A poll, conducted between April and June 2016 by the Randstad Institute and Observatory of the Religious Experience at Work (OFRE), surveying 1,405 managers in different companies, revealed that two managers out of every three (65%) were reporting that "religious behavior" is a regular manifestation in the workplace — up from 50% in 2015.

    Professor Lyonel Honoré, Director of OFRE and author of the study, recognizes quietly that "in 95% of cases," the "religious behavior at work is related to Muslims."

    To understand the importance of this "visible Islam" in French factories and offices today, we have to know that traditionally, the workplace was considered neutral space. The law did not prohibit any type of religious or political expression in the workplace, but by tradition, employees and employers considered that restraint must be shown by all in exercising their freedom of belief.

    The 2016 Ranstad study shows that this old tradition is over. Religious symbols are proliferating in the workplace, and 95% of these visible symbols are Islamic. Overt expressions and symbols of Christianity or Judaism at work do exist, of course, but are minimal compared to Islam.

    The survey considered two types of the expression of religious beliefs:

    1. Personal practices, such as the right to be missing for religious holidays, flexible working hours, the right to pray during work breaks, and the right to wear symbols of religious belief.
    2. Disturbances at work or breaches of rules, such as the refusal of men to work with a woman or take orders from a female manager, refusal to work with people who are not co-religionists, refusal to perform specific tasks, and proselytizing during work time.

    "In 2016," states the survey, "the wearing of religious symbols [hijab] became the top expression of religious belief (21% of cases, up from 17% in 2015 and 10% in 2014). The request to be absent because of religious holidays remains stable (18%) but now ranks in second place."

    Under "disturbances at work", this politically correct study notes that conflicts between employee and employer on religious grounds are few: a "minority event" and "only" 9% of religious disturbances in 2016. But figures for conflicts have nevertheless risen by 50%, up from 6% in 2015. Conflicts have also tripled since 2014 (3%) and nearly quintupled since 2013 (2%).

    Eric Manca, a lawyer in the law firm August & Debouzy who specializes in labor law and was assisting at the press conference, said that when a conflict on religious ground turns to litigation, "it is always a problem with Islam. Christians and Jews never turn to the court against their employer because of religion." When Islamists sue their employer, jurisprudence shows that the accusation is always based on "racism", and "discrimination" — charges that can only make employers regret having hired them in the first place.

    Sources of conflict listed include proselytizing (6%), and refusing to perform tasks (6%) — for instance, a delivery man declining to deliver alcohol to customers; refusing to work with a woman or under the direction of a woman (5%), and requesting to work only with Muslims (1%). These cases are concentrated in business sectors "such as automotive suppliers, construction, waste processing, supermarkets… and are located in peri-urban regions."

    Conclusions

    The French model of assimilation is over. As noted, it worked for everyone except French Muslims; and public schools seem unable today to transmit republican values, especially among young Muslims. According to Hakim el Karoui:

    "Muslims of France are living in the heart of multiple crises. Syria, of course, which shakes the spirit. But also the transformation of Arab societies where women take a new place: female students outnumber male students, girls are better educated than their fathers. Religion, in its authoritarian version, is a weapon of reaction against these evolutions. …. And finally, there is the social crisis: Muslims, two-thirds of child laborers and employees, are the first victims of deindustrialization."

    Islamization is growing everywhere. In city centers, most Arab women wear a veil, and in the suburbs, burqas and niqabs are increasingly common. At work, where non-religious behavior was usually the rule, managers try to learn how to deal with Islamist demands. In big corporations, such as Orange (telecom), a "director of diversity" was appointed to manage demands and conflicts. In small companies, managers are in disarray. Conflicts and litigation are escalating.

    Silence of the politicians. Despite the wide media coverage around these two studies, an astounding silence was the only thing heard from politicians. This is disturbing because Institut Montaigne's study also included some proposals to build an "Islam of France," such as putting an end to foreign funding of mosques, and local training religious and civil leaders. Other ideas, such as teaching Arabic in secular schools "to prevent parents from sending their children in Koranic schools" are quite strange because they would perpetuate the failed strategy of integrating Islamism through institutions. Young French Muslims, even those born in France, have difficulty speaking and writing proper French. That is why they need to speak and write French correctly before anything else.

    These two studies, although a start, are staggeringly insufficient. Politicians, journalists, and every citizen needs to learn more about Islam, its tenets and its goals in the country. It is unbelievable that the only tools at our disposal are inadequate opinion polls. Without knowledge, no political action — or any other action — is possible. It is a situation that immeasurably benefits aggressive political Islamists.

    Without more knowledge, the denial of Islamization, and an immobility in addressing it, will continue. Willful blindness is the mother of the civil war to come — unless the people and their politicians choose to submit to Islam without a fight.

  • INSiDe RoBBY MooK'S MoM'S BaSeMeNT…

    INSIDE ROBBY MOOK'S MOM'S BASEMENT

  • Big Brother Is Watching – New Emails Reveal Homeland Security Tracks License Plates At Gun Shows

    Newly discovered emails from the Department of Homeland Security (DHS), reveal efforts of the federal government to track American citizens who visit gun shows across the country.  The discovery came via a Freedom of Information Act (FOIA) request from the Wall Street Journal that revealed internal emails from an Immigration and Customs Enforcement (ICE) agent requesting the support of local California police officers to “deploy license plate readers” at a 2010 gun show in Del Mar, California.

    In an email titled “Request for Assistance,” an ICE investigator wrote, “We would like to see if you can support an outbound guns/ammo operation on (redacted) at the Crossroads (Del Mar) Gun Show. We would like to deploy license plate readers.” The email, whose sender and recipient are redacted, includes a large section of operational details that are also redacted.

    According to the emails, the program was intended to collect license plate data from gun shows and then cross reference that data with border crossings in an attempt to identify gun runners.  Of course, the program has drawn criticism from gun rights organizations across the country who argue that this form of mass surveillance draws undue suspicion to people who happen to engage in two completely legal activities. 

    Jay Stanley, a lawyer at the American Civil Liberties Union, said the gun-show surveillance “highlights the problem with mass collection of data.” He said law enforcement can take two entirely legal activities, like buying guns and crossing the border, “and because those two activities in concert fit somebody’s idea of a crime, a person becomes inherently suspicious.”

     

    Erich Pratt, executive director of Gun Owners of America, said his group also opposes such surveillance. “Information on law-abiding gun owners ends up getting recorded, stored, and registered, which is a violation of the 1986 Firearm Owners Protection Act and of the Second Amendment,” Mr. Pratt said.

    Gun Show

     

    Of course, efforts to target gun owners is nothing new.  Just last week we pointed out a new ballot measure being considered by voters in Washington state, officially referred to as Initiative Measure 1491, that would allow authorities to seize guns from people considered “significantly more likely to commit violence toward themselves or others in the near future” (see “WA Goes After Pre-Crime: Gun Confiscation Proposed For Those ‘Likely To Commit Violence In The Near Future’“).  In most instances, seizing someone’s personal property on the mere suggestion of an ex-girlfriend would be considered outrageous but for gun owners our government seems to be increasingly willing make exceptions.

    This type of data gathering continues to push the limits on how far the federal government is allowed to go in terms of mass surveillance before actually violating the constitutionally protected rights of American citizens to privacy.    

    License-plate readers are increasingly used by law-enforcement agencies as a way to search for fugitives, missing children, and, recently, the man who allegedly set off a bomb in New York City.

     

    But their use at gun shows occupies a murky legal ground. While technology and data collection have greatly expanded the ability of government and companies to monitor citizens’ activity, U.S. courts, lawmakers, and senior officials have been slow to make clear what types of mass surveillance cross the line into violations of constitutional rights.

     

    It has long been legal for police officers to record license plates they observe in the course of ordinary life. License-plate-reader technology, however, allows those observations to become mass-data collection. A single camera can record thousands of vehicle plates an hour, capturing the data at high speeds, in thick traffic and in other situations that the human eye cannot.

     

    Boosters of the technology say it is a way to find a criminal in a sea of otherwise indistinguishable cars. Critics say that to find that criminal the government is tracking the movements of millions of innocent people—adding up to detailed surveillance of their daily lives and creating data that can be misused.

    As the CEO of the “Crossroads of the West” gun show points out, the show attracted 6,000 – 9,000 customers who would probably “be resentful of having been the target of that kind of surveillance.”

    Bob Templeton, the CEO of Crossroads of the West, which puts on the gun show, said he knew local police had been at the show, but was surprised to learn that federal agents had been gathering data about customers. The show at the Del Mar Fairgrounds typically draws 6,000 to 9,000 customers, meaning thousands of cars are in the parking lot, he said.

     

    “It’s obviously intrusive and an activity that hasn’t proven to have any legitimate law-enforcement purpose,” said Mr. Templeton. “I think my customers would be resentful of having been the target of that kind of surveillance.”

    So, just to clarify today’s events, the DHS can conduct mass surveillance of the American public just for choosing to attend a gun show but the FBI has to sign a “side agreement promising to physically destroy Cheryl Mills’ and Heather Samuelson’s computers before being able to review evidence in an actual criminal investigation? 

  • 40 Million Russians To Take Part In "Nuclear Disaster" Drill, Days After US General Warns Of War With Moscow

    As relations between Russia and the US disintegrate as a result of the escalating proxy war in Syria, which today culminated with Putin halting a Plutonium cleanup effort with the US, shortly before the US State Department announced it would end negotiations with Russia over Syria, tomorrow an unprecedented 40 million Russian citizens, as well as 200,000 specialists from “emergency rescue divisions” and 50,000 units of equipment are set to take part in a four day-long civil defense, emergency evacuation and disaster preparedness drill, the Russian Ministry for Civil Defense reported on its website.

    According to the ministry, an all-Russian civil defense drill involving federal and regional executive authorities and local governments dubbed “Organization of civil defense during large natural and man-caused disasters in the Russian Federation” will start tomorrow morning in all constituent territories of Russia and last until October 7. While the ministry does not specify what kind of “man-caused disaster” it envisions, it would have to be a substantial one for 40 million Russians to take part in the emergency preparedness drill. Furthermore, be reading the guidelines of the drill, we can get a rather good idea of just what it is that Russia is “preparing” for.

    The website adds that “the main goal of the drill is to practice organization of management during civil defense events and emergency and fire management, to check preparedness of management bodies and forces of civil defense on all levels to respond to natural and man-made disasters and to take civil defense measures.” Oleg Manuilov, director of the Civil Defence Ministry explained that the exercise will be a test of how the population would respond to a “disaster” under an “emergency” situation.

    Some further details, on the 3-stage, 4 day drill:

    I stage: organization of civil defense actions

     

    The stage is going to practice notification and gathering of senior officials of federal and regional executive authorities, local governments and civil defense forces, deployment of civil defense management system on all levels, readying civil defense communication and notification system. After the National Crisis Management Center have brought the management signals, all management bodies, state authorities, forces and facilities on duty and people will be notified through notification systems available.

     

    II stage: Planning and organization of civil defense actions. Deploying a team of civil defense forces and facilities designed to respond to large disasters and fires.

     

    The stage plans to practice deployment a mobile interagency multi-functional team of civil defense forces and facilities in each federal district in order to carry our rescue and other urgent operations, civil defense actions and to deploy special civil defense units in constituent territories; putting rescue military units, divisions of the federal fire service, rescue units on standby. The stage provides for the team to be reinforced, activation of backup control centers and practicing collecting and exchanging information in the field of civil defense.

     

    III stage: Organization of actions of civil defense management bodies and forces for response to large disasters and fires.

     

    The stage will deal with the use of the civil defense team to respond to large disasters and fires, setting up aerial and mobile control centers, revising of routes for save evacuation of people, organization of vital services; taking off fire and rescue units of the federal fire service to put out fires and conduct rescue operations at potentially dangerous facilities, including closed administrative territorial entities.

     

    The drill will rehearse radiation, chemical and biological protection of the personnel and population during emergencies at crucial and potentially dangerous facilities. Fire safety, civil defense and human protection at social institutions and public buildings are also planned to be checked. Response units will deploy radiation, chemical and biological monitoring centers and sanitation posts at the emergency areas, while laboratory control networks are going to be put on standby.

    The fact that among the measures tasked for the civil defense team will be a response to “disasters and fires” as well as the rehearsal of “radiation, chemical and biological protection”, makes it clear that Russia is about to hold its biggest nuclear war drill since perhaps the end of the Cold War.

    Why now? Perhaps, in addition to the sharp deterioration in relations between Russia and the west, where tensions are on par with the cold war, another answer may come from the Chairman of the Joint Chiefs of Staff Joseph Dunford, who last week warned Congress that the implementation of a No Fly Zone in Syria as proposed by John Kerry recently, and a centerpiece of Hillary’s foreign policy strategy, would result in World War III.

    During testimony before the Senate Committee on Armed Services last week General Joseph Dunford rang the alarm over a policy shift that is gaining more traction within the halls of Washington following the collapse of the ceasefire brokered by the United States and Russia in Syria saying that it could result in a major international war which he was not prepared to advocate on behalf of. Senator Roger Wicker of Mississippi asked about Hillary Clinton’s proposal for a no fly zone in Syria in response to allegations that Russia and Syria have intensified their aerial bombardment of rebel-held East Aleppo since the collapse of the ceasefire.

    “What about the option of controlling the airspace so that barrel bombs cannot be dropped? What do you think of that option?” asked Wicker. “Right now, Senator, for us to control all of the airspace in Syria would require us to go to war against Syria and Russia. That is a pretty fundamental decision that certainly I’m not going to make,” said the Chairman of the Joint Chiefs of Staff suggesting the policy was too hawkish even for military leaders.

    As a reminder, Hillary Clinton strongly argued in favor of a no fly zone ever since October 2015, just days after Russia began a bombing campaign aimed at maintaining the stability of the Syrian government. “I personally would be advocating now for a no fly zone and humanitarian corridors to try to stop the carnage on the ground and from the air, to try to provide some way to take stock of what’s happening, to try to stem the flow of refugees,” said Clinton in an interview with NBC in October 2015.

    Despite the warnings, the former Secretary of State and current presidential candidate, who has a well-known hawkish position towards regime change and matters related to Russia, has continued to advocate this position which has gained traction in recent weeks among top US diplomats.

    Clinton is note alone: as the WSJ reported in June, more than 50 US diplomats endorsed a notorious dissent memo, demanding that that the Obama administration employ military options against Assad, such as the implementation of a no fly zone if not a direct attack against the Syrian regime. The argument from the diplomats is that the situation in Syria will continue to devolve without direct action by the US military, an argument of dubious legality if undertaken unilaterally without a UN Security Council resolution but which as Sputnik reports, the US Ambassador to the UN Samantha Power has been laying the groundwork for under the controversial “right to protect” theory of international law arguing that Russia’s opposition to a resolution should be ignored because they are a party to the conflict.

    Russia, in turn, has countered that if the Assad regime falls then terrorist groups including ISIS and al-Nusra Front will likely fill the resulting power vacuum descending the country into an even greater harbor for international terrorism. Ultimately, the Syrian conflict is fundamentally about the transport of energy, and whether Russia maintains its dominance over European natural gas imports, or if – with the Syrian regime deposed – a Qatar natural gas pipeline can cross the territory and make its way to Europe.

    As for the Russian nuclear war drill, we can only hope that any such rising hints of nuclear warfare remain in the realm of the purely theoretical.

  • More Confessions Of An Economic Hit Man: "This Time, They’re Coming For Your Democracy"

    Submitted by Sarah van Gelder via YesMagazine.com,

    Twelve years ago, John Perkins published his book, Confessions of an Economic Hit Man, and it rapidly rose up The New York Times’ best-seller list. In it, Perkins describes his career convincing heads of state to adopt economic policies that impoverished their countries and undermined democratic institutions. These policies helped to enrich tiny, local elite groups while padding the pockets of U.S.-based transnational corporations.

    Perkins was recruited, he says, by the National Security Agency (NSA), but he worked for a private consulting company. His job as an undertrained, overpaid economist was to generate reports that justified lucrative contracts for U.S. corporations, while plunging vulnerable nations into debt. Countries that didn’t cooperate saw the screws tightened on their economies. In Chile, for example, President Richard Nixon famously called on the CIA to “make the economy scream” to undermine the prospects of the democratically elected president, Salvador Allende.

    If economic pressure and threats didn’t work, Perkins says, the jackals were called to either overthrow or assassinate the noncompliant heads of state. That is, indeed, what happened to Allende, with the backing of the CIA.

    Perkins’ book has been controversial, and some have disputed some of his claims, including, for example, that the NSA was involved in activities beyond code making and breaking.

    Perkins has just reissued his book with major updates. The basic premise of the book remains the same, but the update shows how the economic hit man approach has evolved in the last 12 years. Among other things, U.S. cities are now on the target list. The combination of debt, enforced austerity, underinvestment, privatization, and the undermining of democratically elected governments is now happening here.

    I couldn’t help but think about Flint, Michigan, under emergency management as I read The New Confessions of an Economic Hit Man.

    I interviewed Perkins at his home in the Seattle area. In addition to being a recovering economic hit man, he is a grandfather and a founder and board member of Dream Change and The Pachamama Alliance, organizations that work for “a world that future generations will want to inherit.”

    Sarah van Gelder: What’s changed in our world since you wrote the first Confessions of an Economic Hit Man?

    John Perkins: Things have just gotten so much worse in the last 12 years since the first Confessions was written. Economic hit men and jackals have expanded tremendously, including the United States and Europe.

    Back in my day we were pretty much limited to what we called the third world, or economically developing countries, but now it’s everywhere.

    And in fact, the cancer of the corporate empire has metastasized into what I would call a failed global death economy. This is an economy that’s based on destroying the very resources upon which it depends, and upon the military. It’s become totally global, and it’s a failure.

    van Gelder: So how has this switched from us being the beneficiaries of this hit-man economy, perhaps in the past, to us now being more of the victims of it?

    Perkins: It’s been interesting because, in the past, the economic hit man economy was being propagated in order to make America wealthier and presumably to make people here better off, but as this whole process has expanded in the U.S. and Europe, what we’ve seen is a tremendous growth in the very wealthy at the expense of everybody else.

    On a global basis we now know that 62 individuals have as many assets as half the world’s population.

    We of course in the U.S. have seen how our government is frozen, it’s just not working. It’s controlled by the big corporations and they’ve really taken over. They’ve understood that the new market, the new resource, is the U.S. and Europe, and the incredibly awful things that have happened to Greece and Ireland and Iceland, are now happening here in the U.S.

    We’re seeing this situation where we can have what statistically shows economic growth, and at the same time increased foreclosures on homes and unemployment.

    van Gelder: Is this the same kind of dynamic about debt that leads to emergency managers who then turn over the reins of the economy to private enterprises? The same thing that you are seeing in third-world countries?

    Perkins: Yes, when I was an economic hit man, one of the things that we did, we raised these huge loans for these countries, but the money never actually went to the countries, it went to our own corporations to build infrastructure in those countries. And when the countries could not pay off their debt, we insisted that they privatize their water systems, their sewage systems, their electric systems.

    Now we’re seeing that same thing happen in the United States. Flint, Michigan, is a very good example of that. This is not a U.S. empire, it’s a corporate empire protected and supported by the U.S. military and the CIA. But it is not an American empire, it’s not helping Americans. It’s exploiting us in the same way that we used to exploit all these other countries around the world.

    van Gelder: So it seems like Americans are starting to get this. What is your sense about where the American public is in terms of readiness to do something?

    Perkins: As I travel around the U.S., as I travel around the world, I see that people are really waking up. We’re getting it. We’re understanding that we live on a very fragile space station, and it’s got no shuttles; we can’t get off. We’ve got to fix it, we’ve got to take care of it, and we’re in the process of destroying it. The big corporations are destroying it, but the big corporations are just run by people, and they’re vulnerable to us. If we really consider it, the market place is a democracy, if we just use it as such.

    van Gelder: I want to push back on that one a little bit because so many corporations don’t sell to ordinary consumers, they sell to other companies or to governments, and so many corporations have such an entrenched reward system where if one person doesn’t perform by exploiting the earth they’ll simply get replaced with somebody else who does.

    Perkins: I’ve recently been speaking at a number of corporate conferences. I hear time after time after time that many of them want to leave a green legacy. They’ve got children, they’ve got grandchildren, they understand we can’t go on like this.

    So what they say is, “Go out there, start consumer movements. What I want is to receive a hundred thousand emails from my customers saying, ’Hey, I love your product but I’m not going to buy it anymore until you pay your workers a fair wage in Indonesia, or wherever, or clean up the environment, or do something.’ And then I can take that to my board of directors and my big stockholders, to the people who really control whether I get hired or fired.”

    van Gelder: I agree, and those campaigns, as you know, have been going on for decades now, and sometimes they have little incremental changes around the edge. But then we look back on it later and we see that there’s enormous resistance because of the profits to be made in continuing the system.

    Perkins: I think we’ve seen tremendous changes, though. Just in the last few years, we’ve seen organic foods become very big. Twenty years ago they couldn’t make a go of it. We’ve seen women having bigger positions in corporations, and minorities, and we need to get better at this.

    We’ve seen the labeling of many foods. GMOs aren’t included yet, but nutrition and calories and so forth are. And what we really need to do is convince corporations that they’ve got to have a new goal.

    We’ve got to let corporations know what their job is: It’s to serve a public interest, and make a decent rate of return for investors. We need investors, but beyond that, every corporation should serve a public interest, should serve the earth, should serve future generations.

    van Gelder: I want to ask you about the Trans-Pacific Partnership, and other trade deals. Is there any way that we can beat these things back so they don’t continue supercharging the corporate sphere at the expense of local democracies?

    Perkins: They’re devastating; they give sovereignty to corporations over governments. It’s ridiculous.

    We’re seeing terrible desperation from people in Central America trying to get away from a system that’s broken, primarily because our trade agreements and our policies toward Latin America have broken them. And we’re seeing, of course, those similar things in the Middle East and in Africa, these waves of immigrants that are swarming into Europe from the Middle East. These terrible problems that have been created because of the greed of big corporations.

    I was just in Central America and what we talk about in the U.S. as being an immigration problem is really a trade agreement problem.

    They’re not allowed to impose tariffs under the trade agreements—NAFTA and CAFTA—but the U.S. is allowed to subsidize its farmers. Those governments can’t afford to subsidize their farmers. So our farmers can undercut theirs, and that’s destroyed the economies, and a number of other things, and that’s why we’ve got immigration problems.

    van Gelder: Can you talk about the violence that people are fleeing in Central America, and how that links back to the role the U.S. has had there?

    Perkins: Three or four years ago the CIA orchestrated a coup against the democratically elected president of Honduras, President Zelaya, because he stood up to Dole and Chiquita and some other big, global, basically U.S.-based corporations.

    He wanted to raise the minimum wage to a reasonable level, and he wanted some land reform that would make sure that his own people were able to make money off their own land, rather than having big international corporations do it.

    The big corporations couldn’t stand for this. He wasn’t assassinated but he was overthrown in a coup and sent to another country, and replaced by a terribly brutal dictator, and today Honduras is one of the most violent, homicidal countries in the hemisphere.

    It’s frightening what we’ve done. And when that happens to a president, it sends a message to every other president throughout the hemisphere, and in fact throughout the world: Don’t mess with us. Don’t mess with the big corporations. Either cooperate and get rich in the process, and have all your friends and family get rich in the process, or go get overthrown or assassinated. It’s a very strong message.

    van Gelder: I wanted to ask about your time spent in Ecuador with indigenous people. I’m wondering if you could talk about how that experience has changed you?

    Perkins: Many years ago when I was a Peace Corps volunteer in the Amazon with the Shuar indigenous people there, I was dying. I got very ill, and my life was saved in one night by a shaman. I’d come out of business school this is 1968, ’69, and I had no idea what a shaman was, but it changed my life by helping me understand that what was killing me was a mindset—what they would call the dream.

    I spent many years studying all this, and working with many different indigenous groups, and what I saw was the power of the mindset.

    The shamans teach us—the indigenous people teach us—once you change the mindset, then it’s pretty easy to have the objective reality change around it. So, instead of the kind of economy we have now, a death economy, if we can change the mindset we can very quickly move into a life economy.

    van Gelder: So what are the mechanisms by which a change in consciousness actually shifts things on the ground?

    Perkins: Well, in my opinion the biggest catalyst that needs to go forward to change this is we’ve got to change the corporations. We’ve got to move from that goal that was stated by Milton Friedman in the 1970s, that the only responsibility of corporations is to maximize profits regardless of social and environmental costs.

    We change the big corporations by telling them we’re not going to buy from you anymore unless you change your goal. No longer should your goal be to maximize profits regardless of social and environmental costs. Make a decent rate of return for your investors, but serve us, we the people, or we’re not buying from you.

    van Gelder : You quote Tom Paine in your book: “If there must be trouble let it be in my day that my child may have peace.” Why did you decide to use that quote?

    Perkins : Well, I think Tom Paine was brilliant in that statement. He understood how that would impact people. And he wrote that statement in December 1776.

    Washington had lost just about every battle he ever fought; he wasn’t getting any support from the Continental Congress; they weren’t giving his men guns or ammunition or even blankets and shoes, and he was bogged down at Valley Forge. Paine realizes that he’s got to somehow write something that will rally people, and there’s nothing that rallies people more than to think about their children

    That to me is where we’re at right now. I’ve got a daughter and I’ve got an 8-year-old grandson. Bring on the trouble for me, OK, but let’s create a world they’re going to want to live in. And let’s understand that my 8-year-old grandson cannot have an environmentally sustainable and regenerative, socially just, fulfilling world unless every child on the planet has that.

    And this is new. It used to be all we had to worry about was our local community, maybe our country. But we didn’t have to worry about the world. But what we know now is that we can’t have peace anywhere in the world, we can’t have peace in the U.S., unless everybody has peace.

     

  • FBI Allowed 2 Hillary Aides To "Destroy" Their Laptops In Newly Exposed "Side Agreements"

    Just when you think the Hillary email scandal can’t get any more bizarre and corrupt, it does. According to a just released letter from the Chairman of the House Judiciary Committee, Bob Goodlatte (R – Virginia), to Attorney General Lynch, the FBI apparently struck “side agreements” with both Cheryl Mills an Heather Samuelson to “destroy” their “laptops after concluding its search.”

    In the attached, Goodlatte questioned why the destruction of the laptops used to sort Clinton’s emails was included in immunity deals that already protected Mills and Samuelson from prosecution based on the records recovered from their computers. Furthermore, we learn that according to the immunity agreements, FBI agents limited their search to documents authored before Jan. 2015. The Republican argued such parameters prevented investigators from examining potential proof of the destruction of evidence that may have occurred after that date, and that the deals offered to Mills and Samuelson already protected the aides from prosecution related to their alleged roles in the deletion of federal records.

    “Like many things about this case, these new materials raise more questions than answers,” Goodlatte wrote of the “side agreements,” which lawmakers were allowed to read even though they have not yet been released in full to members of Congress.

    The immunity deals for Mills and Samuelson were negotiated before they agreed to hand over their laptops which we now learn were subsequently destroyed.

    While we parse the letter to understand what basis for action the FBI may have had when pursuing such a course of action, we can’t help but note that the FBI appears to have acted as a co-conspirator in what appears to be an unprecedented case of destruction of key evidence.

    Below are some of the key excerpts from the letter (full document attached at the end of this post):

    As part of the Judiciary Committee’s ongoing oversight of Secretary Clinton’s unauthorized use of a private email server during her tenure as Secretary of State, the Justice Department (DOJ) provided in camera review’ of certain immunity agreements. After a specific request from the Committee, based on references made in the immunity agreements to certain “side agreements,” DOJ subsequently provided in camera review of those “side agreements” between DOJ, the Federal Bureau of Investigation (FBI), and Beth Wilkinson, the lawyer representing both Cheryl Mills and Heather Samuelson. Like many things about this case, these new materials raise more questions than answers. Please provide a written response to the below questions and make DOJ staff available for a briefing on this matter no later than October 10, 2016.

     

    1.    Why did the FBI agree to destroy both Cheryl Mills’ and Heather Samuelson’s laptops after concluding its search?

     

    2.    Doesn’t the willingness of Ms. Mills and Ms. Samuelson to have their laptops destroyed by the FBI contradict their claim that the laptops could have been withheld because they contained non-relevant, privileged information? If so, doesn’t that undermine the claim that the side agreements were necessary?

     

    7.   Please explain why DOJ agreed to limit their search of the Mills and Samuelson laptops to a date no later than January 31, 2015 and therefore give up any opportunity to find evidence related to the destruction of evidence or obstruction of justice related to Secretary Clinton’s unauthorized use of a private email server during her tenure as Secretary of State.

     

    8.   Why was this time limit necessary when Ms. Mills and Ms. Samuelson were granted immunity for any potential destruction of evidence charges?

     

    9.   Please confirm whether a grand jury was convened to investigate Secretary Clinton’s unauthorized use of a private email server. Disclosure is authorized under Fed. R. Crim. P. 6(e)(3)(A)(i) and (e)(3)(D).

    Of course, since this will be promptly spun as just more “plumes of smoke” we hope people will stop trying to “criminalize behavior that is normal.”

    Link to letter here.

  • Kuroda Ruined His Chance Of A Second Term By Doing "Stupid Things", Abe Advisor Says

    It was one thing when Wall Street slammed Haruhiko Kuroda, and the BOJ, for the latest “QQE with Yield Curve Control” monetary contraption unveiled last month by the Japanese central bank as a “disaster”, coupled with such dire forecasts “it may be over for the BOJ.” But when politicians such Nobuyuki Nakahara, a close advisor to Japan’s prime minister on the economy and an intellectual father of the Bank of Japan’s first run at quantitative easing in 2001, say that “Kuroda has ruined his chances of getting a second full term”, things start to get serious for everyone’s favorite monetary policy Peter Pan.

    In a stinging attack on the BOJ’s recent actions, Nakahara said during an interview on September 30 that the central bank’s switch to yield-curve targeting compounds its earlier error of adopting negative interest rates (which we learned was launched following “peer pressure” by billionaires and policy makers at Davos, early in 2016) and is a disappointing move away from monetary-base expansion. Abe’s advisor also said the decision to conduct a comprehensive review of monetary policy had invited defeat on reflationist efforts and would raise questions about Abenomics as a whole.

    Echoing our thoughts on QQEWYCC, Nakahara said that the BOJ is “trying to clean up the mess of negative rates. It’s impossible to do a stupid thing like keeping the yield curve under government control. They changed the regime to rates from quantity, meaning those who support quantitative easing were defeated. Reflationists on the BOJ policy board lost. An exit from deflation is going to be far away.” Kuroda has insisted after the BOJ’s policy decision that it hadn’t reached the practical limits of its bond buying and wasn’t moving toward tapering.

    Under the new yield-curve regime, the central bank has pledged to keep the yield on benchmark 10-year debt around zero. The problem in this, according to Nakahara, is that if the yield falls further below zero, the BOJ will have to slow its sovereign debt purchases to push the yield back up and markets will interpret this as tapering. This in turn will push the yen up and stocks down. This was explained previously on this website,  and was observed in practical terms this past Friday when the BOJ’s indicated purchases for super-long-term debt could see the central bank buying the smallest amount since expanding QQE two years ago. As Bloomberg reporter previously, for the first operations next month, BOJ plans to buy 110b yen for debt maturing in more than 25 years, 190b yen for bonds with maturities of 10 to 25 years, down by 10b yen each compared with the latest operation, the BOJ said on Friday.  This would be the smallest purchases of debt of more than 10 years since BOJ expanded quantitative easing in Oct. 2014, and is the definitional equivalent of “tapering.”

    Perhaps shaken by the comments, in parliament on Monday Bloomberg reported that Kuroda defended his policies and reiterated that there is room for additional monetary easing, adding that the recent changes have strengthened the previous framework and increased the sustainability of his policy. Ultimately, whether or not he will be reappointed to another term is a matter for the government and the parliament to decide, Kuroda said.

    Chief Cabinet Secretary Yoshihide Suga told reporters he was “aware that there are various opinions regarding monetary policy among private-sector economists and critics. I want to decline to comment on individual views,” said Suga. “The government wants the BOJ to continue make its utmost efforts to reach the price target as early as possible.”

    As Bloomberg adds, after being greeted with fanfare when he took the helm, Kuroda, 71, now faces a reversal of fortunes on multiple fronts. Markets – that biggest driver behind “Abenomics” – have moved against him and critics are growing more vocal. The extended honeymoon he enjoyed with a rising stock market and falling yen are long gone and his 2 percent inflation goal is nowhere in sight. Kuroda has less than 19 months to go in his term. While no BOJ governor has been tapped for a second five-year term since the 1960s, Kuroda’s central role in Abenomics has led to speculation that he may be different.

    “They should end negative rates, but they took action to save face and offset the failure of negative rates,” Nakahara said. “Bringing the rate up to zero means tightening, causing the yen to rise. The current framework is very vulnerable to external factors.

    Meanwhile, Fitch Ratings said on Monday that the negative rate may be cut to minus 0.5% , from minus 0.1% now, by the end of 2017. This would weigh on the profitability of commercial banks, Fitch said. However, Moody’s Investors Service was more upbeat and raised its forecast for real gross domestic product growth in Japan this year to 0.7 percent.

    In June Nakahara suggested that the central bank boost its purchases of Japanese government bonds to 100 trillion yen ($988 billion) a year, from 80 trillion yen. The governor’s propensity to deliver surprises also drew the ire of Nakahara. He described the about-face in adopting negative rates in January – which came the same month as ruling this out – as being “like the attack of Pearl Harbor.”

    * * *

    One person, however, who did not share Nakahara’s gloomy perspective on Abenomics, is RBC’s Charlie McElligott, who in a note today, explained why the BOJ’s announcement last week merely sets the stage for much more aggressive action in the future.

    This is what he said:

    KURODA IN A CORNER = ASYMMETRICAL POLICY RISK: The final point above regarding Kuroda mentality and the BoJ is of great importance for global risk assets.  Japan is the “weathervane” for markets and their sentiment towards QE monpol, which is how our most recent version of the “taper tantrum” with the global long-end selloff originated there following the Sakurai / JGB curve steepening commentary. 

     

    Todd Cross on our Asia USD Rates Trading desk has been making the case that Kuroda is being further ‘backed into a corner’ via the increasingly negative rhetoric from his former peers…which in turn will only make him MORE LIKELY to get asymmetrical on policy at the next meeting.  Todd’s view is that the BoJ now has a “free option to exercise” with Kuroda, where since he will be either read as “hero” (if “kitchen-sinking-it” works) or “scapegoat” (if the policy fails, he’ll be out of a job)…so in a sense, the BoJ is liberated to act MORE AGGRESSIVELY on stimulus.  This also ties-in nicely to a thought we’ve been discussing for a while now within the “RBC Big Picture” too, which has been the market’s misinterpretation that the BoJ “assessment” outcome was a shift towards ‘curve control / yield targeting,’ and a move AWAY from NIRP…when in fact, we are more confident than ever that the BoJ will be pushing even MORE negative on rates.  And “not for nuthin,” but Kuroda himself stated in front of the Japanese Parliament today that the BoJ has further room to add stimulus.

     

    The mix of the market being “lulled to sleep” thinking that the BoJ has “moved away from NIRP” into an increasingly-threatened Kuroda (who, along with Abe, believes that negative interest rates are the ‘key monpol vehicle’ to drive inflation) is a dangerous dynamic for global risk if they do indeed “shock” markets with more NIRP.  The most brutal part of this scenario?  We could get the ‘policy surprise’ call “right,” but get a completely binary response in $yen / JGB markets.  The “macro minds” team is having a ton of debate on whether we see a stronger or weaker $yen if this did indeed “play out.”  A purely “mechanical” market response would seemingly see the VERY substantial ‘long Yen’ positioning get spooked by such a surprise and get ‘puked.’  BUTTTTTTT, a view where a policy shock causes a counter-intuitive flight to quality / risk-aversion response in Yen (as experienced since the initial NIRP announcement) could see $yen travel to mid-90s in a heartbeat. 

    Whatever the outcome for the BOJ, and Kuroda, one thing is increasingly clear: even the central bankers are now in openly uncharted waters, and having largely exhausted most options, not even they know where the hyper-unorthofox monetary policies will take them, which for an entity that can purchase any and every asset using an unlimited source of funds, is a truly concerning place to be.

  • Dilbert Creator Scott Adams "Shadowbanned" From Twitter After Trump Support

    Following the permanent banning of conservative commentator Milo Yiannopoulos from using its service; the suspension of the account of Glenn Reynolds, aka @instapundit and creator of the Instapundit blog, a University of Tennessee law professor and a conservative columnist for USA TODAY; and blocking veteran reporter Mahir Zeynalov after bowing to pressure from Turkish president Erdogan; last week saw the ‘shadowbanning’ of thoughtful – non-violent – twitter-er Scott Adams – the creator of the Dilbert cartoon character.

    Following a blog post daring to discuss how “dangerous” Donald Trump was compared to Hillary Clinton… (excerpt below)

    …the alleged risks of each candidate so you can see how they compare on the “scariness” dimension.

     

    Alleged Clinton Risks

    1. Dementia risk (because of age)
    2. Low energy (maybe can’t perform the job)
    3. Temperament (alleged to yell and throw things)
    4. Might allow more terrorists into country via immigration
    5. Influenced by lobbyists to start wars (Eisenhower warned of this)
    6. Drinks alcohol (We don’t know how much or how often)
    7. General brain health is questionable lately
    8. Adversaries won’t know who she serves or how she will react.

     

    Alleged Trump Risks

    1. Dementia risk (because of age)
    2. Trump is “literally Hitler” (This risk is cognitive dissonance, not real)
    3. Con man (Sure, but we’ll be watching him closely)
    4. Temperament (responds proportionately every time)
    5. Race riots (Clinton’s side created this risk by framing Trump as a racist)
    6. Inexperience (But Trump routinely succeeds where he has no experience)

     

    If you think Trump is risky because of his “temperament” or because he is “literally Hitler” you are experiencing cognitive dissonance caused by Clinton’s persuasion game. I mean that literally. And remember that I’m a trained hypnotist. That doesn’t mean I’m always right, but it does mean I’m trained to spot cognitive dissonance and you probably aren’t.

     

    I don’t think any of us is smart enough to evaluate the relative risk of either candidate. And that’s my point. If you think Trump is the dangerous one, that isn’t supported by his history, his patterns, or the facts. It is literally an illusion created by his opponents.

    Scott Adams asked his followers for examples of Clinton supporters being violent against peaceful Trump supports in public… which seems to have ‘triggered’ some people and got Adams “Shadowbanned” from Twitter

    This weekend I got “shadowbanned” on Twitter. It lasted until my followers noticed and protested. Shadowbanning prevents my followers from seeing my tweets and replies, but in a way that is not obvious until you do some digging.

     

    Why did I get shadowbanned?

     

    Beats me.

     

    But it was probably because I asked people to tweet me examples of Clinton supporters being violent against peaceful Trump supporters in public. I got a lot of them. It was chilling.

     

    Late last week my Twitter feed was invaded by an army of Clinton trolls (it’s a real thing) leaving sarcastic insults and not much else on my feed. There was an obvious similarity to them, meaning it was organized.

     

    At around the same time, a bottom-feeder at Slate wrote a hit piece on me that had nothing to do with anything. Except obviously it was politically motivated. It was so lame that I retweeted it myself. The timing of the hit piece might be a coincidence, but I stopped believing in coincidences this year.

     

    All things considered, I had a great week. I didn’t realize I was having enough impact to get on the Clinton enemies list. I don’t think I’m supposed to be happy about any of this, but that’s not how I’m wired.

     

    Mmm, critics. Delicious 🙂

     

     

    P.S. The one and only speaking gig I had on my calendar for the coming year cancelled yesterday because they decided to “go in a different direction.” I estimate my opportunity cost from speaking events alone to be around $1 million. That’s based on how the rate of offers went from several per month (for decades) to zero this year. Blogging about Trump is expensive.

     

    But it is also a system, not a goal. I wrote a book about that.

    Oh and we are sure it is just coincidence that Dilbert’s blog site is currently down…

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Today’s News 3rd October 2016

  • Why American Military Doctrine Is Doomed For Failure

    Submitted by Federico Pieraccini via Strategic-Culture.org,

    An analysis of US generals’ growing dissatisfaction with the political leadership in Washington sheds new light on the direction in which the American military machine is heading. In particular, it is interesting to observe the military planning for the future of the sea, air, space, cyberspace, and land forces.

    At the end of the Cold War, the US armed forces found themselves without any real peer, causing them to gradually alter their strategy and investments in war and conflicts. They transitioned from being a large numerical force geared toward fighting opponents of a similar caliber (the USSR) in accordance with a specific military strategy, to a force focused on hybrid adversaries (regular or militia forces) or foes that were not their equal (Iraq, Syria, Afghanistan, Yugoslavia, and Libya). The US military accordingly proceeded to change its planning and tactics to satisfy the demands of the new tenants in the White House, the notorious Neoconservatives. What resulted was a military doctrine centered on the concept of a unipolar world and aimed at global domination.

    Since the early 90s, policy-makers in Washington have had as their objective the utopian goal of global hegemony, and in order to accomplish this the US armed forces had to expand and create new control centers (USAFRICOM, USNORTHCOM), in addition to those already in existence (USEUCOM, USPACOM, USSOUTHCOM, USSOCOM, USSTRATCOM, USTRANSCOM), in every corner of the planet.

    This is a typical example of imperial overreach, which has historically been the impetus for the collapse of several kingdoms and empires over the centuries.

    The operational capabilities of the US military machine from the 90s to the mid-2000s remained more or less unchanged in every major conflict in which it was involved: Yugoslavia in 1999, Afghanistan in 2001, and Iraq in 2003. These were conflicts in which the defense forces of these nations could not hope to match the attacker's power. Weak air defences were a common denominator for all these nations – a vulnerability that has always been the prerequisite for wars such as those in Iraq and Afghanistan, as well as the US ability to attain air superiority and thus subsequently enjoy unchallenged air space.

    Carpet bombing, coupled with the use of staggering numbers of cruise missiles, destroyed the anti-aircraft defenses of both countries, paving the way for massive ground or airborne invasions. One example still fresh in everyone’s mind was the intensity of the US strike in the early days of the Iraq war in 2003, which brought unprecedented levels of death and destruction.

    Yet despite this advantageous position, the number of dead American and allied soldiers during the years of occupation was enough to shock the American public, perhaps forever changing the perception of the military conflict. The consequences were predictable, with popular pressure forcing a withdrawal of troops from Iraq and a significant reduction of the contingent stationed in Afghanistan.

    After a 70-year history of warfare, the old strategy of bombing, invading, and occupying a conquered territory had outlived its usefulness.

    Time to change. New Goal: World Domination

    The pursuit of a new global strategy required changes. A numerically smaller force was now needed, which would could be deployed on short notice to any corner of the world. US military strategists began to develop plans for new operational training methods and procedures, based on rapid-reaction forces and the ability to reach any theater of war with ease. To this end, US special forces, drones used for reconnaissance and attack, and reliance on the National Reconnaissance Office (NRO) and National Security Agency (NSA) ended up almost totally replacing the previous approach and tactics that had been focused on protecting ground troops.

    This organizational change, which allowed the regional command centers a high-degree of strategic and decision-making autonomy, increased the complexity of the American military machine on a devastating scale. The practical results of these transformations could be seen in the control centers’ reduced ability to respond to external threats as a single military power under a single flag.

    In less than 10 years the United States had gone from a largely ground force able to invade foreign countries with sizable numbers of troops – thanks to its uncontested mastery of the airspace – to an organized military force compartmentalized into small units, which has rarely been asked to intervene directly in a conflict. Thus there has been less emphasis on a search for means and technologies to protect soldiers on the battlefield.

    Instead, air power has continued to be the decisive weapon in the war scenarios for several years, especially in North Africa and the Middle East. In 2011 in Libya, one of its latest demonstrations of air superiority, the power of the USAF, combined with that of its allies, provided the necessary cover allowing ground forces (consisting of terrorists who later invaded Syria and the Sinai Peninsula) to conquer and occupy that territory.

    To an attentive observer, all these nations that have found themselves in the US military’s crosshairs in recent years share a common characteristic, namely a pronounced inability to defend their own airspace. Once the skies were conquered, which provided protection for the troops during ground operations, most of the work was already done.

    But this is a formula that has not always had a successful impact on the course of the fighting. Ukraine and Syria are proof, despite representing two very different scenarios.

    A new situation

    For entirely different reasons, the two scenarios have highlighted the shortcomings and the strategic and structural weaknesses of the unified military command. In the case of Syria, the air-defense capabilities of the forces loyal to Damascus, rated among the top ten in the world, forced analysts in Washington in 2013 to develop a strategy based on the need to destroy the air-defense systems with the use of numerous cruise missiles that were launched from their fleet in the Mediterranean. Unless the surface-to-air missile (SAM) systems are disabled, the USAF cannot operate with impunity above Syrian skies and risks heavy losses. Syrian anti-aircraft systems are still quite able to neutralize not only an air attack but also a cruise-missile barrage, making any US assault enormously expensive (each Tomahawk costs about a million dollars), counterproductive, and ineffective. This new situation prompted Obama to seek Moscow's help to avoid a conflict that would have caused more than one headache for the Pentagon.

    In the case of Ukraine, control of the airspace was uncontested as the Donbass does not possess an air force that can rival that of the Ukrainian military, and thus the military plan was more focused on effective coordination between ground troops, heavy vehicles, and reconnaissance. The goal was to make tactical advances and to conquer the territories in dispute. Yet despite advisors sent from Washington and the technology offered by the United States (the NSA and NRO), Kiev’s army suffered grim setbacks at the hands of irregular forces far more poorly armed in terms of quality and quantity.

    Soon, a series of new situations began to unfold for the United States. Its inability to control the airspace over Syria or gain ground in Ukraine was symptomatic of a deeper malaise affecting the capabilities of the US military and its allies to fight certain battles.

    Back to the old school

    In the minds of US generals and military advisers, these developments were an unprecedented wake-up call. After 70 years of wars and conflicts, the US found itself for the first time in situations where it could neither afford the luxury of intervening directly (Ukraine) nor be able to provide a concrete solution that would reverse the situation on the battlefield (Syria). This was a cause for concern, forcing American political leaders to rethink their entire approach to military confrontation and to formulate a new strategy to face these new challenges.

    In some public meetings conducted by General Robert Neller (Commandant of the Marine Corps) and General Joseph Dunford (Chairman of the Joint Chiefs of Staff), both men have highlighted the most important challenge for the future of the United States military. They foresee a transformation, over just 15 years, into a military force capable of fighting not only enemies that are well equipped (as in Syria and Ukraine) but also on par with the US (Russia and China). It is a revolution, or more precisely, a return to the past.

    In defining these challenges, Dunford spoke of what is referred to in military jargon as the “4+1,” i.e., the nations that the US Strategic Command sees as posing major challenges over the next 10 years, in other words: Russia, China, North Korea, and Iran + Terrorism. In describing this approach, Dunford has outlined a future war scenario mainly involving short-, medium-, and long-range ballistic missiles (SRBMs, MRBMs, and ICBMs, respectively), anti-ballistic systems (ABMs), cyber attacks, and the ability to deny access or airspace (A2/AD).

    What will surprise the reader is the admission by Neller and Dunford that the United States has some operational issues that could easily be exploited by opponents. Rival countries (peer competitors) have made technological strides in the past decade allowing them to almost close the gap with the US military in vital sectors for future war scenarios in many fields, such as the following:

    • Fifth-generation aircraft (J-31 and PAK FA) with stealth capabilities.

    • Long-range ballistic missiles (R-36M) and short-/medium-range missiles (Iskander).

    • ICBMs with supersonic speed (unable to be intercepted by current and future ABMs).

    • The ability to produce cybernetic damage with real-world effects.

    • Increasingly advanced technology to deny airspace to an opponent either electronically (EW) or mechanically (S-300, S-400, S-500).

    In all these challenges we can see America’s advantages being diminished. Another worrying aspect, of which both commanders are aware, is the need to have an Internet/intranet connection in order to operate at full capacity. The interconnection between men and means for the United States is a force multiplier, just as is the need to project power on enemy shores through naval forces. Strategies to deny these advantages are essential components of Russia’s and China’s military doctrines.

    The new generation of anti-ship missiles (DF-26BrahMos II, Qader and P-900) offer a clear example of how Beijing and Moscow are reacting to the steady degradation of the frameworks for global peace. If the US Navy is denied a radius of several hundred kilometers, which is needed in order to control ships and aircraft carriers close to an enemy coast, this is a big problem for American military planners. The anti-ship missiles also offer an economic advantage: they cost little but can sink ships worth billions of dollars. They are thus ideal for challenging the US Navy, whose unparalleled power can be seen in its 10 aircraft carriers. Furthering this strategy, Russia and China are working on beyond-visual-range (BVR) missiles that, combined with stealth aircraft (J-20 and PAK FA), can deny the United States the essential ability to anticipate a lethal attack on its aircraft carriers that can be launched from a safe distance.

    The goal for Beijing, Moscow, or Tehran is always the same: to keep Washington from being able to approach their shores or operate in international waters, in order to prevent the huge American aircraft carriers from being used as a launch pad for military operations.

    In terms of strategic security, the protection of the skies is the first priority for any military planner. ABM systems, like Chinese or Russian S-300, S-400, and S-500s, are, as stated, designed with the goal of creating an impenetrable airspace for ICBMs and/or fourth- or fifth-generation stealth aircraft. Without air cover and naval platforms, the functional capabilities of any ground troops are drastically reduced. Add to this SRBMs such as Iskander missiles, which can wipe out whole platoons, and one can easily understand why Dunford is worried that he has already lost his technological and operational edge when faced with a competitor of similar stature.

    Certainly the evolution of the American military-industrial complex (MIC) has not facilitated the task of the strategists at the Pentagon. Programs such as the F-35 (fifth-generation stealth aircraft) that were supposed to compete with equivalent Sino-Russian projects have been beset by numerous problems and massive cost overruns, probably the result of a widespread system of corruption, leaving the United States at a disadvantage in future contests for air supremacy.

    Even the US nuclear arsenal (nuclear triad) could use some upgrades to keep it on par with Russia’s, and those modernizations are estimated to cost about a trillion dollars over 10 years, a figure the US Treasury does not currently possess (without printing extra money, but that's another story). Recently Moscow conducted a long list of tests of its ballistic missiles that are capable of achieving unprecedented speed (Mach 6-7), able to change direction after launch, and which possess a significantly increased operating range (17,000 kms), making all current and future anti-ballistic systems ineffective and useless.

    Closing the gap

    Moscow and Beijing have practical considerations (but which are, in a way, almost philosophical) based on the enormous difference in their military spending compared to Washington. This has forced them to aim for inexpensive systems that are nevertheless just as effective.

    A perfect example, already fully operational, is the development and use of Kalibr missiles – the Russian response to the US cruise missile. Similar to the American version, its main difference is that it can be fired from small ships. To understand Washington’s level of anxiety, one need only analyze its reaction to the Black Sea launch of the first Kalibr missiles in 2015 toward targets in Syria. The Pentagon declared its surprise at Russia’s “new” ability to launch such missiles at a distance of thousands of kilometers from such small ships (with consequently reduced costs). This inability to recognize an opponent’s capabilities is perhaps symptomatic of underlying problems.

    The Kalibr missiles allowed Moscow to gain a tactical advantage, which, according to US military advisers, changed the strategic balance in the Middle East. This was enough to dramatically reduce one of the US’s largest advantages: cruise missiles. Top US advisors panicked, realizing they needed to immediately offer an adequate response to this new situation. Moreover, the strategy of equipping small ships with Kalibr missiles has allowed Moscow to produce a large number of corvettes, vastly expanding the total power of the Russian fleet. Moscow currently has quite a number of these ships, all armed in this way.

    The United States prefers the opposite philosophical stance in terms of its projects. Long-term projects are being promoted that offer massive opportunities for price gouging and extra profits for contractors and brokers: stealth ships (USS Zumwalt), mega carriers (Gerald R. Ford class), and the F-35 are just a few examples. Without offering any immediate technological advances, especially in relation to the countermoves of the “4 + 1,” it seems that this is where the moderization efforts of the US armed forces are focused.

    Paradoxically, although the US cannot even deploy a few F-35s, nations such as North Korea and Iran already have strategies in place to use deterrence to nullify the current American operational supremacy. In this sense, despite sanctions and the international climate of hostility, Pyongyang has managed to produce a submarine equipped with nuclear SLBMs – a big step forward that greatly expands its ability to deter the United States and South Korea. In Iran, the mass production of domestically developed weapons (Bavar-373) similar to the S-300 system (and just as effective) have been designed to deny any operational capacity over the skies of the Islamic Republic and its allies (Hezbollah and Syria) in the immediate future.

    An impossible request

    Washington is asking its generals to be prepared for a large-scale conflict with opponents of a stature equal to its own, but the reality behind the scenes is troubling, and the desperate cries of Dunford and Neller, appropriately kept hidden from the media, offer proof of this. Just a simple comparison of the military doctrines of China, Russia, and the United States – in regard to their long-term trajectory – shows that Washington, although possessing a numerical advantage in terms of the forces and means at its disposal, lacks the necessary capability to properly unify the powerful components of the US military in order to dominate its rivals.

    This is probably why General Dunford said recently that subsequent strategic plans by US armed forces will not be made public. Evidently, hiding these endemic weaknesses is necessary to avoid jeopardizing a cornerstone of the strategy of US forces: the ability to project power and intimidate opponents without having to take real action.

    Conclusions and today's conflicts

    Because they have effectively taken advantage of all the above factors, Russia, Iran, and their allies have attained the necessary skills to prevent direct US intervention in various contexts, from Ukraine to Syria.

    In analyzing what has not worked in the Middle East or Eastern Europe, the US is blinded by the complexity of its military system and is focusing mostly on its inability to rapidly devise a workable strategy that is inexpensive in terms of human casualties. This is the main reason Washington has been forced to lean on outside actors to influence events on the ground (mercenary battalions in Ukraine and Salafis and Wahhabis in Syria). As we can see, these are all choices that do not pay off in the long run, instead allowing other rising powers to dominate the United States without necessarily resorting to a direct confrontation.

    The wars of the third millennium AD also heavily rely on psychological factors and deterrence, as well as the essential ability to influence an opponent with false information. Take the example of Syria and the Russian intervention. No one at the Pentagon or CIA was able to predict Russia’s air and naval deployment, which was accomplished in less than 48 hours. No one, least of all Dunford, was ready at the time with a well-defined plan to respond to this move. In addition to technical and organizational inefficiencies, there is a clearly inadequate ability to decipher an opponent’s moves such as one does in chess. The ability to catch an opponent off guard has already proved its effectiveness in the conflict in Ukraine, in which Crimea was reunified with Russia without a shot being fired and with full popular support.

    Dunford and Neller have grasped that any future battlefield will be a hostile environment in terms of air superiority, Internet connectivity, and the simultaneous management of resources across a broad geographical spectrum. It is a challenge with – by the general’s own admission – a far from obvious outcome. Washington's policy, which is dominated by lobbies and corruption, requires an unprecedented turnaround in its military apparatus. But this is what is needed in order to meet the future challenges of a multipolar world with different nations (allied together) with capabilities equal to that of the US military machine.

    The truth, which is difficult for US policymakers to accept, is that the current environment of the military-industrial complex (MIC) leaves little room to maneuver, given the gargantuan projects that are in place. The F-35 is unlikely to be put on hold while the project is completely revised and its actual ability to carry out the tasks required of a fifth-generation fighter reviewed. The same could be said about the development of expensive ships such as the USS Enterprise and USS Zumwalt, in which several hundred billion dollars have already been invested.

    Military spending is an essential gear in the machine of the US system of oligarchy, but the consequences are starting to drag down the future military capabilities of the United States. Its rivals are catching up, using systems that are more advanced, more economical, and more effective, while also easier to use or replicate. The military leaders at the Pentagon are starting to show telling signs of impatience, calling for a transformation that will be difficult to achieve, since it will require a sea change in the country's top-brass establishment. The ultimate consequences are evidence of a pattern that is slowly draining Washington’s wallet and greatly reducing the competitive advantage that Washington possesses.

  • General Market Commentary 10-2-2016 (Video)

    By EconMatters


    The week starts off both the month and the quarter for fund flows as money managers allocate capital to their best ideas for the 4th quarter of 2016. The ISM, European Bank News, and the Job`s Report set the tone for this week.

    © EconMatters All Rights Reserved | Facebook | Twitter | YouTube | Email Digest | Kindle   

  • ALERT: US Real Estate Crash Imminent as Matthew threatens Miami Luxury Market

    It isn’t often such a clear market signal is painted such as the impending real estate market collapse.  It doesn’t take sophistocated algorithms or an MBA from Harvard to add up the math and the data and see that we’re on the precipice of a historic real estate asset cliff; and that the market is waiting for an ‘event’ to tip it over.  That event, it can be Hurricane Matthew.  That means this can all unfold THIS WEEK.  For those of us who have been following this trend for a long time (like, more than 10 years) this isn’t news, it’s just the obvious result of bad planning and decades of building a foundation on the wrong things (this is an educational metaphor – Real Estate Investors built their knowledge on the wrong ideals, the false axioms, and thus – invested in the wrong markets, on markets build on soft, unstable foundations…).

    As we explain in Splitting Pennies – Understanding Forex; the entire world’s economy, both micro and macro, can be explained through the prism of monetary policy.  Or in other words, if you master FOREX, you can master any market, because all markets are denominated in Forex.  Or in yet other words, markets are only able to function as a derivative of money markets – which Forex is.  

    Bubbles have persisted for years, but this last bubble that caused the 2008 crisis was based on real estate.  For a long time, US real estate prices always went up; until they didn’t.  So what changed in 2008?  Enter Quantitative Easing, a program designed by the Fed to create ‘liquidity’ in the market that was otherwise illiquid.  Starting out buying ‘toxic’ assets no one wanted, now the Fed has a diversified portfolio of many assets, much of which is real estate.  This is not the only thing propping up the real estate market.  Also, the Fed has given banks and hedge funds HUGE access to cheap capital, or free capital, in large quantities.  Let’s take the world’s largest, as the best example; Blackstone, with $100 Billion + to invest in real estate:

    Blackstone, helmed by global head of real estate Jon Gray, is the largest real estate private equity firm in the world. Since raising their first opportunistic real estate fund in 1997, Blackstone has been a dominant player in the industry with their simplified opportunistic philosophy of “buy it, fix it, sell it”. Just this month, Blackstone real estate surpassed a staggering $100 billion in assets under management. As part of a push towards a longer hold, core plus strategy, they recently closed the largest ever PE real estate fund at $15.8 billion. Furthermore, Blackstone recently acquired Chicago’s iconic Willis Tower, which they plan to enhance through value add renovations and a repositioning of the tower’s retail space.

    Well, not all $100 Billion is invested in Real Estate, but remember, they are leveraged, so they don’t buy for cash, so it’s not known what they’re real ‘real’ estate portfolio is.  Between the Fed buying MBS (Mortage Backed Securities), Hedge Funds & Private Equity Funds like Blackstone, and your typical foreign buyers fleeing corruption or a crashing economy in their own market – real estate is highly inflated.  This is of course, exaggerated in niche areas; Los Angeles, San Francisco, Las Vegas, Boston, New York, Miami, Greenwich CT, and many, many others.  Just take a look at what you get in Ohio for $4M and what you get in San Francisco for $4M.  Hmm… Something doesn’t add up here.  People in CA shocked at non-CA market values.  Hmm… and there’s high state taxes in CA, and pollution, a water drought, and fallout from Fukushima irradiating the crops and population, explosion of cancers.  Where do I sign?  

    Years ago, analysts said that in 50 years Florida will be underwater.  Real Estate investors didn’t feel that their feet were wet, so they ignored this.  Well, these analysts were wrong – it’s happening much, much, much faster.  Miami-Dade County is going to be hit the hardest.  If you don’t know about this issue, read this article here “A Rising Tide” :

    “This whole beautiful landscape’s going to change,” he said. Miami Beach consists of a long, low barrier island accompanied by a scattering of manmade islets. It’s one of the lowest-lying municipalities in the country, and its residents are leading the way into the world’s wetter future. Along the island’s low western side bordering Biscayne Bay, people have come to dread full-moon high tides, when salt water seeps into storm-drain outlets and the porous limestone that provides the island’s foundation, forcing water up and out into the streets and sidewalks and threatening buildings and infrastructure. And Miami Beach is just one small part of a region that’s in big trouble. If sea levels rise as projected, no major U.S. metropolitan area stands to rack up bigger losses than Miami-Dade County. Almost 60 percent of the county is less than six feet above sea level. Even before swelling of the seas is factored in, Miami has the greatest total value of assets exposed to flooding of any city in the world: more than $400 billion. Once you account for future sea-level rise and continued economic growth, Miami’s exposed property will far outstrip that of any other urban area, reaching almost $3.5 trillion by the 2070s. The sea level around the South Florida coast has already risen nine inches over the past century. Among experts, the optimists expect it to edge up another three to seven inches in the next 15 years and nine inches to two feet in the next 45 years. More pessimistic (some say increasingly realistic) predictions say the rise will be much faster. Even the very gradual rise of recent decades will make extensive infrastructure reengineering necessary—Mowry’s job. However, according to a report published by the Florida Department of Transportation, it will become difficult, expensive, and maybe impossible for these efforts to keep up with the accelerated sea-level rise that is actually expected. 

    Miami is spending $500 Million building walls and drainage to address this problem.  Read the 2012 Presentation in PDF here.  But will it be enough?  And what about Hurricanes?  A Category 5 hurricane can have a storm surge of 20 – 30 feet, such as Camille in 1969.  Storm Surge is when the water rises, completely – that means the ocean will rise 24 feet (Read about it here).  Matthew, if it struck Florida, would really be Biblical.  Billions of Dollars in damage would occur, just from the storm.  And this information is not ‘priced in’ to this already ‘frothy’ market, just see spring articles about Miami’s real estate crash here, here, and here.

    This article being the most dramatic: “Luxury Urban Housing, Built on a Myth, Is About to Take a Big Hit”.

    The other info that you need to know, since the early 90’s, the US Government manipulates the weather.  If you’re not up to date on this topic, you can read about it here in this groundbreaking book Chemtrails, HAARP, and the Full Spectrum Dominance of Planet Earth.  Or for a simple primer on Geo-engineering, checkout No Natural Weather: Geoengineering 101.  Then, why would they allow a hurricane to smash into South Florida?  Who knows, but if you want to look at the strange correlation between military events and Hurricanes, take a deeper look at 911 and Hurrican Erin – This book Black 911 is a great start.

    Matthew is now heading toward Jamaica, at which point it may settle down; Jamaica has mountains which Hurricanes don’t like.  But Florida is being warned.  

    Traders, tomorrow’s trade is easy; put in your buy limits above the MAs on HD, LOW, and get ready to short homebuilders, and other South Florida real estate companies.  This week is going to be a wild ride for real estate, regardless if Matthew hits FL or not.

    The market now is quiet, sales are down 80% in some areas (i.e. Greenwich, CT “Billionaire Capital”), but the panic selling hasn’t started yet.  An event such as a Hurricane in FL, or a big Earthquake in CA, can be the tipping point that starts it.

    This will hit the rent market too – as values collapse, rents will too.  Not only that, but a bad economy will put pressure on renters and their ability to pay.  This recent bubble, in both housing values, rent prices, and other assets – is just that.  A bubble.  It will pop.  And as we saw in 2008, each time the bubble bursts, the drawdown is a little deeper.  But real estate in particular recovered with the help of the Fed and numerous Fed players, as this was a political victory as well as an economic one.  It was seen as helping Main St. as well as Wall St.

    There’s other investments, other ways to make money than real estate, such as Forex algorithms.  But it seems that as usual, investors will need to have a huge loss before learning this lesson.  

    Pain – is the only real teacher!

    To learn more about the financial markets, checkout Splitting Pennies – Understanding Forex – your pocket guide to make you a Forex genius!  Or visit Fortress Capital Forex, and broaden your horizons.

  • "I'm A Bernie Sanders Voter.. Here's Why I'll Vote Trump"

    Authored by Eric Zuesse,

    Sometimes, things in politics are the opposite of the way they seem. The Presidential contest between the ‘liberal’ Hillary Clinton’ and the ‘conservative’ Donald Trump is perhaps the most extreme example of this — for ten reasons that will be documented here.

    I have never voted Republican in my life, starting with my first vote in the 1960s. I’ve consistently supported Bernie Sanders for President (even before he entered the contest). The reason for that support is his record in public office, regarding especially these ten key issues, where Sanders’s actions in public office contrast sharply against Hillary Clinton’s actions in public office. (Her policy-words lie often; but her policy-actions never have lied — actions speak the truth.) Trump has no record at all in public office. Even if he’s as bad as he sometimes projects to be, he’s not as bad as Hillary’s policy-record already is. But his clear superiority over her isn’t merely his lack of any record in public office; because, as will be demonstrated here, his words on some of the crucial public-policy issues have been consistently far more progressive than her actions on those same issues have been (and sometimes more progressive than her words on these issues have been) — and, in Donald Trump’s case, words are all that we have to go by, because his record as a businessman displays nothing about his authentic views about public policy, but only about his self-interest. Both of these two candidates are liars, and any intelligent voter knows it by now.

    First, here, will be stated these ten key issues, on each of which issues Bernie and Hillary are opposites, and then Trump’s stated position regarding each of the ten will be presented.

    At the end will be presented the reason I won’t vote for Jill Stein.

    Here are the ten key issues:

    1:  Sanders favors “breaking up the big banks.” Hillary Clinton opposes that.

     

    2:  Sanders has fought consistently against Obama’s mega-‘trade’ deals. Hillary consistently favored them.

     

    3:  Sanders favors working with Russia against jihadists in Syria. Hillary opposes that.

     

    4:  Sanders says jihadists are America’s top foe. Hillary says both jihadists and Russia are equally anti-American, equally dangerous to America. Hillary is simply a neoconservative; Sanders isn’t. Her having voted to invade Iraq was no mistake on her part; it was consistent with her entire international outlook, all of which is neoconservative, like invading Libya, Syria, etcetera. Bernie’s vote against invading Iraq was likewise consistent with his international outlook.

     

    5:  Sanders has been consistently opposed to fossil fuels. Hillary has aggressively supported them.

     

    6:  Sanders says that the system is rigged. Hillary says that it’s not.

     

    7:  Sanders says the system is rigged specifically against the poor. Hillary says the problem that keeps people poor is instead individual bigots — against Blacks, Hispanics, women, gays, etc. Not the system itself. She is proud to represent the system. She’s not against it. She’s for it.

     

    8:  Sanders’s political career has been financed by small-dollar donations. Hillary’s has been financed by mega-donations.

     

    9:  Sanders favors every possible means of reducing the influence big-money donations to politicians has over politics. Hillary opposes that idea.

     
    10:  Sanders favors socialized health insurance, like exists in the European nations that spend per-capita half what America does but have higher life-expectancy than America does. Hillary opposes that — she favors the existing profit-based system of health-care, and opposes the European system where basic healthcare is a right, no privilege (that’s based only on ability-to-pay).
    *  *  *
    I support Sanders not because his rhetoric on these matters is correct in my view, but because his record on them is correct: he has voted in Congress consistently in the ways that his rhetoric has said he believes — and I agree with his record, and thus too with his rhetoric (since it’s the same as his rhetoric). Hillary has instead contradicted herself frequently — and even voted in Congress, and acted as the U.S. Secretary of State — in ways that directly contradict her mealy-mouthed progressive statements. Her record shows that she’s actually the anti-Bernie, the opposite of Bernie. Trump (as I shall document here) is definitely not that (despite his frequent appeals to conservatives for their votes). This article will document the reasons why any reasonable and well-informed progressive will vote for Donald Trump.
     
    *  *  *
    Here are the positions of Trump and of Clinton on these ten key issues:
     

    1:  Sanders favors “breaking up the big banks.” Hillary Clinton opposes that.

    The real meaning of “breaking up the big banks” is separating investment banks from commercial banks: it has nothing actually to do with a bank’s size. It has to do with a bank’s function. It’s structural, not an issue of mere size (which Bernie’s opponents pretend it to be). 
     
    As Morning Consult reported on 18 July 2016, Bernie Sanders required as a precondition in order for him to endorse Hillary Clinton for President, the inclusion in the Democratic Party platform of a recommendation that the FDR-era Glass-Steagall Act, which had separated investment banking (stock-brokerage) from commercial banking (checking and savings accounts), be restored. Bill Clinton had killed Glass-Steagall, and that’s one big reason why Wall Street heavily funds the Clintons. The elimination of Glass-Steagall returned the U.S. in 2000 to the structure that had produced the Great Depression, in which billionaires were gambling with the money of depositors — gambling with depositors’ checking accounts and savings accounts. That ending of Glass-Steagall set the groundwork for building the bubble which ended with the 2008 economic crash. Both Clintons have been against restoring Glass-Steagall, but Sanders forced this into the platform, even though a party’s platform is pure PR, no real policy-statement. This was purely Bernie’s statement, not at all Hillary’s. (In fact, at the very same time she did this merely nominal act, she selected as her VP pick Senator Tim Kaine, who is a longtime agent for Wall Street and international corporations, and who just before she selected him, was the subject of an article by Zach Carter at Huffington Post, on July 20th, headlined “Tim Kaine Calls To Deregulate Banks As He Campaigns To Be Clinton’s VP”. Kaine also had provided one of the 60 votes to pass Fast Track Trade Promotion Authority, the enabling act for ultimate passage of Obama’s TPP, which will give international corporations unprecedented power if passed. Fast Track needed 60 votes in order to pass, and that’s exactly what it got; each of those 60 votes, including Tim Kaine’s, was essential for it. Hillary supported Fast Track. Clearly, she also will deregulate further the financial firms; what her husband did in 1999 wasn’t bad enough to suit her. With this VP pick, she was stabbing Sanders in the back, right at the start of the Democratic National Convention.)
     
    When Bill Clinton ended Glass-Steagall, it was by his signing a piece of legislation titled the Gramm-Leach-Bliley Act, and all three of those names attached to it were Republicans — this was the fulfillment, the very culmination, of a longtime Republican Party effort to end Glass-Steagall. Bill Clinton was a right-wing Democrat (though not as far-right as Hillary) who, by moving the Democratic Party to the right, forced the Republican Party even farther to the right than it had been, in order for Republican candidates to be able to continue to attract conservative voters. Barack Obama has perfected this strategy (of moving America’s political center toward the right) even further. Hillary Clinton would carry it much farther still. The congressional vote on Gramm-Leach-Bliley occurred near the end of Bill Clinton’s Presidency, by which time, there was almost as high a percentage of congressional Democrats who voted to repeal that Democratic Party (FDR) milestone law as there was of Republicans who voted to repeal it, but only Republicans would attach their names to this far-right bill. Gramm-Leach-Bliley was a sell-out to Wall Street. Hillary Clinton always supported strongly that sell-out; Bernie forced her now to nominally oppose it.
     
    That same Morning Consult article also reported that, “Paul Manafort, campaign chairman of presumptive GOP nominee Donald Trump, told reporters in Cleveland today that the Republican platform will include language calling for the reinstatement of the law that was repealed in 1999.” That was shocking news. 
     
    When Donald Trump forced into the Republican platform a restoration of the Democratic Glass-Steagall Act, this was his statement, not something that somebody else forced upon him. He knew that doing this would antagonize Wall Street, but he did it anyway. Trump actually wants to ‘break up the big banks’. He would allow the traditional Republican lower-class voter-base favorites of banning abortions, etc. (he needs those people’s votes in order to win), but he wouldn’t allow Gramm-Leach-Bliley to continue (he apparently doesn’t think he’ll need those people’s money in order to win).
     
    On 9 August 2016, the far-right American Enterprise Institute headlined “How Can Trump Support Deregulation and Glass-Steagall?” and opened by saying, “The Republican platform’s proposal to reinstate Glass-Steagall is hard to understand, even in the confused policy mishmash created by Donald Trump. The best interpretation is that it’s an awkward outreach to the disappointed ‘progressive’ supporters of Elizabeth Warren and Bernie Sanders. The worst is that it calls into question whether Donald Trump really supports financial deregulation. The key problem for those Republicans who are now warily supporting their presidential nominee is that it is not clear where he will lead the party in this election — and the country — if he wins.” That’s precisely true. Conservatives view this with alarm. By contrast, few progressives have yet been equally smart, to even recognize that it exists — the fact that Donald Trump is, perhaps, as much of a closeted progressive, as Hillary Clinton is a closeted fascist (servant of international corporations, their chosen government dictator).
     
    The AEI article continued: “But how can we believe any of this [Trump’s anti-regulatory statements]? More than anything else, the reinstatement of Glass-Steagall suggests that the government, and not private decision-making, should determine the structure of the economy. One can’t believe in the reinstatement of Glass-Steagall and still believe in the repeal or significant modification of Dodd-Frank. It’s like saying free markets work, but price controls can help.” 
     
    The answer to that is: Trump recognizes “that the government, and not private decision-making, should determine the structure of the economy,” and that this is one of the fundamental reasons government even exists — to establish “the rules of the road” for the economy.
     
    On 28 January 2016, Chris Arnade headlined in Britain’s Guardian, “I worked on Wall Street. I am skeptical Hillary Clinton will rein it in”, and he wrote: "Ask anyone who has spent the last two decades on Wall Street which politicians have worked for them the hardest and most will grudgingly admit it’s the Clintons.” Those millions of dollars didn’t come from Occupy Wall Street — they came from Wall Street.
     
    Any really well-informed progressive knows that Dodd-Frank was largely a sell-out to the mega-corporations, which competitively gain, from the enormously complex Dodd-Frank Act, a huge advantage against the smaller firms, because the more complex a regulatory law is, the more that the required paperwork to comply with it will cripple small firms and so provide added competitive advantage to large firms (for which such paperwork is inevitably a far smaller percentage of their total costs of doing business). Dodd-Frank is a Wall Street monstrosity, and AEI knows it, but they’re appalled that the Republican Presidential nominee stands against the mega-firms that pay AEI’s bills. This is not something that AEI is accustomed to, from a Republican Presidential nominee. After all: the Dodd-Frank Act was Barack Obama’s law he wanted to pass in order to placate Democrats who were demanding restoration of the Glass-Steagall Act. It’s not something that a progressive would support. It was the way to avoid doing what progressives wanted to be done — restoring Glass-Steagall. (Similarly: Obamacare was the way for Obama to avoid pushing a single-payer health insurance plan, such as by opening Medicare to everyone.) 
     
    The AEI commentary closed: “The Trump proposal to reinstate Glass-Steagall — only a technical idea of no particular consequence to most American voters — has major implications for the credibility of the candidate in whom so many Republicans have now placed their trust. Like the canary in the coal mine, it’s small but significant.” They know that though the public don’t pay attention to such things (the things that are important), the reinstatement of Glass-Steagall is an enormous threat to the ability of America’s billionaires to gamble with the money in the public’s checking accounts and savings accounts — their ability to take the gambling-profits and to leave the government holding the bag in the event that those aristocrats’ gambles don’t pay off (like the Wall Street bailouts in 2008). They favor ‘socialism for the rich, capitalism for the poor’. So does the Democratic Presidential nominee, Hillary Clinton; and, thus, AEI is part of the Republican Party elite’s move away from Trump, toward Hillary. They’re increasingly recognizing such “canaries in the coal mines,” from Trump. Progressive Democratic voters should recognize it too, before they help elect Wall Street’s favorite candidate by not voting for Trump.
     

    2:  Sanders has fought consistently against Obama’s mega-‘trade’ deals. Hillary consistently favored them.

    Hillary Clinton was instrumental in getting the “Fast Track Trade Promotion Authority” law approved by congressional Democrats, and that’s the enabling law which now makes likely the ability of Obama to get his TPP ‘trade’ treaty with Pacific countries passed into lawduring the upcoming “lame duck” session of Congress, November 9th through January 3rd. She was a part of it, and she has always acted behind the scenes to push for passage of such treaties, including her own husband’s NAFTA.
     
    Like Bernie Sanders, Donald Trump has passionately condemned those treaties, and is urging members of Congress to vote against TPP if and when Obama tries to get it passed into law right after the November 8th elections (which is when members of Congress are maximally willing to do what their funders want and their voters oppose).
     
    Hillary's 2003 Living History (p. 182) actually bragged about her husband’s having passed NAFTA, and she said: “Creating a free trade zone in North America — the largest free trade zone in the world — would expand U.S. exports, create jobs and ensure that our country was reaping the benefits, not the burdens, of globalization.” This was one of, supposedly, her proudest achievements, which were (p. 231) “Bill’s successes on the budget, the Brady bill and NAFTA.” But Hillary in her 2008 primary campaign against Obama was demanding that he apologise for his campaign flyer’s having said: “Only Barack Obama fought NAFTA and other bad trade deals.” That statement was just a fact. (Only after Obama started his second Presidential term in 2012 did he staff-up for, and start an operation to institute, mega-‘trade’ agreements that are much bigger, and much worse, even than NAFTA. For that purpose, he hired Michael Froman, who had been the Clinton-operative and longtime Obama friend who had personally introduced Obama in 2004 to the top people on Wall Street who had financed the Clintons’ political careers.) 
     
    On 20 March 2008, the day after Hillary finally released her schedule during her White House years, The Nation’s John Nichols blogged “Clinton Lie Kills Her Credibility on Trade Policy”, and he said: “Now that we know from the 11,000 pages of Clinton White House documents released this week that [the] former First Lady was an ardent advocate for NAFTA; … now that we know she was in the thick of the maneuvering to block the efforts of labor, farm, environmental and human rights groups to get a better agreement; … now that we know from official records of her time as First Lady that Clinton was the featured speaker at a closed-door session where 120 women opinion leaders were hectored to pressure their congressional representatives to approve NAFTA; now that we know from ABC News reporting on the session that ‘her remarks were totally pro-NAFTA’ and that ‘there was no equivocation for her support for NAFTA at the time’; … what should we make of Clinton’s campaign claim that she was never comfortable with the militant free-trade agenda that has cost the United States hundreds of thousands of union jobs?”
     
    The next day, Jennifer Parker at Jake Tapper’s “Political Punch” blog, headlined “From the Fact Check Desk: The Clinton Campaign Misrepresents Clinton NAFTA Meeting”, and she reported: “I have now talked to three former Clinton Administration officials whom I trust who tell me that then-First Lady Hillary Clinton opposed the idea of introducing NAFTA before health care, but expressed no reservations in public or private about the substance of NAFTA. Yet the Clinton campaign continues to propagate this myth that she fought NAFTA.” Hillary continued this lie even after it had been repeatedly and soundly exposed to be a lie. Her behavior in this regard was reminiscent of George W. Bush’s statements on WMD in Iraq, and on many other issues.
     
    Only a sucker would believe Hillary’s statements in which she says she has changed her mind and now opposes TPP. She knows that when she helped Obama to win Fast Track Trade Promotion Authority, she had the only impact on that matter which she will ever have, and that it’s because of that law, which she helped Obama to pass, that TPP might be approved in Congress even before the next President enters the White House.
     
     

    3:  Sanders favors working with Russia against jihadists in Syria. Hillary opposes that.

    Trump says: “The approach of fighting Assad and ISIS simultaneously was madness, and idiocy. They’re fighting each other and yet we’re fighting both of them. You know, we were fighting both of them. I think that our far bigger problem than Assad is ISIS, I’ve always felt that. Assad is, you know I’m not saying Assad is a good man, ’cause he’s not, but our far greater problem is not Assad, it’s ISIS. … I think, you can’t be fighting two people that are fighting each other, and fighting them together. You have to pick one or the other.” Assad is allied with Russia against the Sauds, so the U.S. (in accord with a policy that George Herbert Walker Bush initiated on 24 February 1990 and which has been carried out by all subsequent U.S. Presidents) is determined to overthrow Assad, but Trump is firmly opposed to that policy.
     
    Months before that, Trump had said: “I think Assad is a bad guy, a very bad guy, all right? Lots of people killed. I think we are backing people we have no idea who they are. The rebels, we call them the rebels, the patriotic rebels. We have no idea. A lot of people think, Hugh, that they are ISIS. We have to do one thing at a time. We can't be fighting ISIS and fighting Assad. Assad is fighting ISIS. He is fighting ISIS. Russia is fighting now ISIS. And Iran is fighting ISIS. We have to do one thing at a time. We can't go — and I watched Lindsey Graham, he said, I have been here for 10 years fighting. Well, he will be there with that thinking for another 50 years. He won't be able to solve the problem. We have to get rid of ISIS first. After we get rid of ISIS, we'll start thinking about it. But we can't be fighting Assad. And when you're fighting Assad, you are fighting Russia, you're fighting — you're fighting a lot of different groups. But we can't be fighting everybody at one time.”
     
    In that same debate (15 December 2015) he also said: “In my opinion, we've spent $4 trillion trying to topple various people that frankly, if they were there and if we could've spent that $4 trillion in the United States to fix our roads, our bridges, and all of the other problems; our airports and all of the other problems we've had, we would've been a lot better off. I can tell you that right now. We have done a tremendous disservice, not only to Middle East, we've done a tremendous disservice to humanity. The people that have been killed, the people that have wiped away, and for what? It's not like we had victory.
    It's a mess. The Middle East is totally destabilized. A total and complete mess. I wish we had the $4 trillion or $5 trillion. I wish it were spent right here in the United States, on our schools, hospitals, roads, airports, and everything else that are all falling apart.”
     
    His thinking about this matter is in the same direction as Bernie Sanders’s but far more fully thought-out, with the connections being made in a prominent way even to domestic spending. If there is anything that is clearly and carefully thought-out in Trump’s policy-positions — and war-peace and the avoidance of precipitating a nuclear war is the very biggest single issue of all — then this issue is it.
     
    Here was the debate-segment about this issue between Bernie and Hillary:
     
    Hillary Clinton, in a debate with Bernie on 19 December 2015, argued for her proposal that the U.S. impose in Syria a “no-fly zone” where Russians were dropping bombs on the imported jihadists who have been trying to overthrow and replace Assad: "I am advocating the no-fly zone both because I think it would help us on the ground to protect Syrians; I'm also advocating it because I think it gives us some leverage in our conversations with Russia.” She said there that allowing the jihadists to overthrow Assad “would help us on the ground to protect Syrians,” somehow; and, also, that, somehow, shooting down Russia’s planes in Syria (the “no-fly zone”) "gives us some leverage in our conversations with Russia.”
     
    Bernie Sanders’s response to that was: "I worry too much that Secretary Clinton is too much into regime change and a little bit too aggressive without knowing what the unintended consequences might be. Yes, we could get rid of Saddam Hussein, but that destabilized the entire region. Yes, we could get rid of Gadhafi, a terrible dictator, but that created a vacuum for ISIS. Yes, we could get rid of Assad tomorrow, but that would create another political vacuum that would benefit ISIS. So I think, yeah, regime change is easy, getting rid of dictators is easy. But before you do that, you've got to think about what happens the day after. And in my view, what we need to do is put together broad coalitions to understand that we're not going to have a political vacuum filled by terrorists, that, in fact, we are going to move steadily — and maybe slowly — toward democratic societies, in terms of Assad, a terrible dictator. But I think in Syria the primary focus now must be on destroying ISIS and working over the years to get rid of Assad. That's the secondary issue.”
     

    4:  Sanders says jihadists are America’s top foe. Hillary says both jihadists and Russia are equally anti-American, equally dangerous to America. Hillary is simply a neoconservative; Sanders isn’t. Her having voted to invade Iraq was no mistake on her part; it was consistent with her entire international outlook, all of which is neoconservative, like invading Libya, Syria, etcetera. Bernie’s vote against invading Iraq was likewise consistent with his international outlook.

    Trump has repeatedly said that jihadists are America’s #1 foe. He constantly says that fundamentalist Muslims — jihadists, such as have been sent out and paid by the Sauds to countries around the world to punish and conquer people who don’t share the Sauds’ particular fundamentalist faith — are the biggest danger to American national security. On this basis, Trump says that America’s invasion of Iraq was wrong:
     
     
     
    The Intercept headlined on 29 February 2016, “Neoconservatives Declare War on Trump”. On 21 March 2016, the Washington Post bannered, “Trump Questions Need for NATO, Outlines Noninterventionist Foreign Policy”. On 23 March 2016, William Greider headlined inThe Nation, “Donald Trump Could Be the Military-Industrial Complex’s Worst Nightmare”.
     
    This is called by some people ‘non-interventionist’, but actually it’s more correctly called opposition to the continuing take-over of the U.S. government by the military-industrial complex. Trump says: “Right now we’re protecting, we’re basically protecting Japan, and we are, every time North Korea raises its head, you know, we get calls from Japan and we get calls from everybody else, and ‘Do something.’ And there’ll be a point at which we’re just not going to be able to do it anymore. Now, does that [intervention] mean nuclear? It could mean nuclear. It’s a very scary nuclear world. Biggest problem, to me, in the world, is nuclear, and proliferation.” On the same basis, he especially wants to ratchet-down, not up (like Clinton does), the U.S. arms-race with Russia, which restoration of the ‘Cold War’ is beneficial to arms-makers and their investors, but not to anyone else. And he’s especially against continuing our existing relationship with the Sauds, the royal family who own Saudi Arabia. He says: “We’re not being reimbursed for the kind of tremendous service that we’re performing by protecting various countries. Now Saudi Arabia’s one of them. I think if Saudi Arabia was without the cloak of American protection, … I don’t think it would be around. It would be, whether it was internal or external, it wouldn’t be around for very long. And they’re a money machine, they’re a monetary machine, and yet they don’t reimburse us the way we should be reimbursed. So that’s a real problem.” The Saud family, the royal owners of their nation, compete against the government of Russia as the leading suppliers of oil to the world. Russia’s main export market was Europe, and the Sauds have wanted to replace Russia’s oil and gas dominance there. The Saud family are also the world’s leading buyer of weaponry. U.S. weapons-makers profit enormously from continuing this relationship — the Sauds buy America’s weapons, and the U.S. joins the Sauds’ wars, which are basically against the allies of Iran and of Russia, the Sauds’ chief competitors. The Sauds helped us end the Soviet Union, by sending Osama bin Laden into Afghanistan etc. and creating Islamic terrorism, both there and subsequently inside Russia, in Chechnia. After King Fahd had a stroke in 1995, Osama bin Laden’s advice was even sought by the Saud Princes to determine which of them should become the next king, and he supplied that advice to them in a letter, which was delivered by a private courier. Since the U.S.-Saudi creation of Islamic terrorism helped end the Soviet Union by 1991, the Sauds have been just a huge drain and embarrassment to America. Only the armaments firms benefit from continuing the campaign, now directed against Russia and its allies (such as were Saddam Hussein, Muammar Gaddafi, Bashar al-Assad, and Viktor Yanukovych), instead of against the Soviet Union and its Warsaw Pact (which are gone).
     
     
    Trump is much more explicit about these things than Sanders has been, and Trump has been even so bold as to assert: “I have two problems with NATO. No. 1, it’s obsolete. When NATO was formed many decades ago we were a different country. There was a different threat. Soviet Union was, the Soviet Union, not Russia, which was much bigger than Russia, as you know. And, it was certainly much more powerful than even today’s Russia, although again you go back into the weaponry. But, but – I said, I think NATO is obsolete, and I think that – because I don’t think – right now we don’t have somebody looking at terror, and we should be looking at terror. And you may want to add and subtract from NATO in terms of countries. But we have to be looking at terror, because terror today is the big threat.”Though there was his usual incoherence — NATO is “obsolete” but “you may want to add and subtract from NATO in terms of countries” (instead of to end it) — his statement isn’t nearly as incoherent as, for example, Hillary’s proposing to bring peace to Syria by going to war there against Russia. And he clarified his view further when he went on to say of NATO, that not only are its member-countries wrong for today’s challenges, but that “it was set up to talk about the Soviet Union,” and the big problem today is terrorism, and “I think, probably a new institution maybe would be better for that than using NATO which was not meant for that.” So: he actually knows that it’s got to be ended. A military alliance that’s “obsolete” is dangerous. Perhaps no U.S. Presidential candidate has spoken in such depth about foreign affairs. In this matter, he has delved far beyond the fashionable political platitutudes, to the basic realities, which no politician wants to talk about. Doing this requires guts. He’s correct not only regarding TPP etc., but regarding fundamental military strategy.
     
    On 18 May 2016, the Republican Robert Kagan, scion of (along with the Kristols) the most famous neoconservative family, and also the husband of Victoria Nuland (Hillary’s friend who ran Obama’s coup in Ukraine and installed racist fascists or nazis into control there), headlined in the Washington Post, “This Is How Fascism Comes to America”, and he opened, with his usual sanctimonious pomposity, “The Republican Party’s attempt to treat Donald Trump as a normal political candidate would be laughable were it not so perilous to the republic.”
     
    Then, the May/June 2016 issue of Politico magazine headlined “The Kremlin’s Candidate”, and Michael Crowley, formerly of The New Republic (the top Democratic Party neoconservative magazine), portrayed Trump in the way that Joseph R. McCarthy had been famous in the old days for portraying people such as Robert La Follette Jr.: as being a traitor. The far-right ‘media-watchdog’ organization, Accuracy In Media (AIM), headlined on 20 April 2016, 25 years after the end of the Soviet Union, “Trump Hires ‘Fixer’ With Soviet Connections”. Hillary Clinton’s shills are all over the newsmedia proclaiming Trump to be Putin’s fool, or Putin’s secret agent, or even to be both at once (which simply exposes how little respect they have for the people who believe their lies).
     
    Trump’s basic message is that the actual Cold War against the Soviet Union and its communism ended in 1991 when the U.S.S.R. and its Warsaw Pact ended, and that until Islamic terrorism arose after that, America really had no enemy after the end of communism — that Islamic jihadists are America’s real enemy, and Mitt Romney was profoundly wrong to allege that "Russia, this is, without question, our number one geopolitical foe.” Mitt supported the invasion of Iraq, just as did Hillary. Hillary was also the one member of the Obama Administration who most effectively argued for and persuaded President Obama to invade Libya. (Both Iraq’s Saddam Hussein and Libya’s Muammar Gaddafi were friendly toward Russia, which neoconservatives especially and viscerally hate. Thus, there was Hillary’s famous “We came, we saw, he died — ha, ha!!”) Trump says something that Sanders himself has merely hinted at: NATO’s emphasis against Russia — the very basis of NATO — is, after 1991, outdated, and needs to be replaced by an entirely new U.S. defense-strategy, one directed instead against jihadists, no longer against Russia, which isn’t even communist anymore, and doesn’t even have the Soviet Union’s Warsaw Pact military alliance anymore. He’s looking long-term, and saying that national security against jihadists is a real concern, but that the war against Russia needs to stop and has no reason to continue, and that, to the contrary, the U.S. and Russia have shared interests in eliminating jihadists and jihadism. He says we’ll need to work together in order to end Islamic terrorism, which will mean a profound change in today’s Islamic world — a change that will benefit Moslems even more than anyone else, but that will also benefit us enormously. The idea of fighting both jihadists and Russians makes no sense at all to him: “You can’t be fighting two people. … You have to pick one or the other.” That’s a stronger statement than Sanders’s (“I think in Syria the primary focus now must be on destroying ISIS and working over the years to get rid of Assad. That's the secondary issue.”), but it’s in exactly the same direction.
     
    Already, the Obama Administration and NATO have pushed the anti-Russian agenda, and are expanding NATO, to such an extent that “The US leadership has done everything it could to push the situation to the brink of disaster.” Beyond that brink is nuclear war. A potential ally in the global war against jihadists is thus instead “without question, our number one geopolitical foe,” and declared by Obama to be the world’s most “aggressive” nation. That’s being said of a nation which wants to be America’s strongest ally, in America’s — and Russia’s — real war: against jihadism.
     
    In addition, the U.S. military are now starting to push for the necessity of going to war as soon as possible against China, so as not to permit the Chinese to arm themselves enough to be able to survive and remain an independent power. Trump has said that as President he will respect China’s independence, though he will negotiate with them a new agreement regarding trade between the two countries. Neoconservatives, by contrast, are only slightly less hostile toward China than they are toward Russia.
     

    5:  Sanders has been consistently opposed to fossil fuels. Hillary has aggressively supported them.

    Trump, like all Republican Presidential contenders (except for Ted Cruz), is no longer outright, and with certainty, denying that global warming is a real problem. On 11 February 2016, MSNBC headlined about this, “How Trump and company warmed to climate change”. However, no Republican Presidential candidate can afford to speak about the necessity to end reliance on fossil fuels, which constitute that Party’s chief and most reliable financial support. A Democrat, such as Hillary Clinton, can afford to speak about it, even if, like Clinton, the given candidate is actually also in the bag for fossil fuel companies. The Trump-Clinton rhetorical difference on global warming can’t be evaluated in a vacuum that’s devoid of these funding-realities. During all of Hillary’s time in public office, she has — by heractions though not always by her words — been a reliable supporter of fossil fuels, and fossil-fuels companies have responded with their money. Trump has no policy-record at all, but only rhetoric (pro-fossil-fuels, of course), and even his rhetoric hasn’t been consistently Republican on this quintessentially Republican issue. The biggest organizer of fossil-fuels political donations, the Koch brothers, are directing all of the Presidential-campaign cash to the Clinton campaign, none to Trump.
     
    On 17 July 2015, Paul Blumenthal and Kate Sheppard at Huffington Post bannered, “Hillary Clinton's Biggest Campaign Bundlers Are Fossil Fuel Lobbyists”  and the sub-head was "Clinton's top campaign financiers are linked to Big Oil, natural gas and the Keystone pipeline.”
     
    Her record does show that she represents those lobbyists, not the public. As I had reported previously, the Hillary Clinton State Department’s two environmental impact statements on the proposed Keystone XL Pipeline were triple-hoaxes that totally and scandalously ignored the proposed pipeline’s impact on climate-change but that did discuss the impact of climate-change on the proposed pipeline (as if anybody even cared about that); neither of the two studies had even one climatologist on the team that prepared the report; and the State Department didn’t do either of the reports themselves, but instead hired two oil-industry contractors that were proposed to the State Department by TransCanada Corporation, which is the company that was proposing to build and own the pipeline. So: those ‘studies' were rigged to enable the President to approve the Pipeline — which he ultimately decided not  to do.
     
    Furthermore, on 2 May 2013, Steve Horn headlined, "Digging Into TransCanada's Lobbying History,” and he found that, indeed, Hillary Clinton was surrounded by TransCanada lobbyists while the reports were being prepared by TransCanada’s chosen oil-industry contractors.
     
    Hillary Clinton is also a big champion of fracking. In September 2014, Mariah Blake bannered "How Hillary Clinton's State Department Sold Fracking to the World,” and reported that, "As part of its expanded energy mandate, the State Department hosted conferences on fracking from Thailand to Botswana. It sent US experts to work alongside foreign officials as they developed shale gas programs.” The energy-companies didn’t pay for those sales-calls by the U.S. Secretary of State; taxpayers did.
     
    Though Clinton verbally endorses the view that global warming is the world’s biggest problem, she doesn’t care about it in her actual actions as a public official. It’s mere rhetoric to her. Trump seems more honest, by saying: “When people talk global warming, I say the global warming that we have to be careful of is the nuclear global warming [blowing up the world]. Single biggest problem that the world has. Power of weaponry today is beyond anything ever thought of, or even, you know, it’s unthinkable, the power. You look at Hiroshima and you can multiply that times many, many times, is what you have today. And to me, it’s the single biggest, it’s the single biggest problem.” Furthermore, that statement was his response to an interviewer’s question, “Would you be willing to have the U.S. be the first to use nuclear weapons in a confrontation with adversaries?” Trump’s response indicated that the nuclear-war issue brought to his mind the issue of global warming: it showed that the mental association in his mind is that these two issues are the two most important issues that a U.S. President must address. He answered the question about nuclear war, by asserting that nuclear war is an even bigger concern for him than is global warming. That’s the correct priority, but it also shows that Trump is no conservative when the issue is global warming. No conservative thinks “global warming” when being asked about nuclear war.
     
    In order for Trump to hold his conservative base, he must include among his nominal ‘economic advisors’ some rabid anti-environmentalists. One of them is the libertarian Stephen Moore, chief economist for the Heritage Foundation, and founder of the Club for Growth. On 10 August 2016, Morning Consult bannered, “Trump Adviser Not Sweating Consequences of Promised Coal Boom”, and Moore criticized Trump for not being sufficiently pro-fracking. Moore even condemned environmentalists by saying “Fracking reduces global warming, you morons!” Of course, that statement of his is false. He then lambasted Barack Obama: “I think he believes totally in this lunatic idea that somehow everything’s going to be underwater in 20 years. … I think Obama is the most fanatical politician I’ve ever met on global warming.” The kicker in the article was this: “Hillary Clinton, however, appears to be ‘less extreme’ than Obama in opposing fossil fuels, Moore said.” Moore, a ‘former’ lobbyist himself, knows that she’s in the fossil-fuels industries’ pockets. Trump, on the other hand, is just a question-mark. Clearly, Trump is seen as the enemy, by the biggest anti-environmentalist political spenders of all: the strongly pro-Hillary Koch brothers.
     
    Furthermore, though the issue of global warming wasn’t raised by the interviewer or anyone else in the September 26th U.S. Presidential nominees’ debate between Hillary and Donald; Trump, and he alone, chose to bring it up during the discussion of nuclear war, when Hillary said there that, “his cavalier attitude about nuclear weapons is so deeply troubling. That is the number-one threat we face in the world.” He replied: “I agree with her on one thing. The single greatest problem the world has is nuclear armament, nuclear weapons, not global warming, like you think and your — your president thinks. Nuclear is the single greatest threat.” Yet again, he was showing the link that exists in his mind between these two premier issues; he was showing an implicit acknowledgement that though nuclear war is the top threat, global warming — if it is occurring — would be #2. If he becomes President, then not only the scientific consensus that it’s happening and is human-caused would be constantly pressing in upon him to acknowledge this reality publicly, but his ‘yielding to it’ and ‘changing his mind’ (if that’s really what it would be) about it, will be far more effective at reducing the shockingly high percentage of the American public who deny this terrible reality, than would a President Clinton’s acknowledgement that it’s real. It could cause the entire Koch-Exxon-etc. campaign of lies about it to collapse (much as happened with regard to the lies that the tobacco industry so successfully had peddled for so long about smoking). The U.S. would become far more cooperative with the international movement against fossil fuels than this country ever has been.
     
    The fossil-fuels industries are smart to be pouring funds into ads against Trump. They’ve been doing that for a long time.
     

    6:  Sanders says that the system is rigged. Hillary says that it’s not.

     

    7:  Sanders says the system is rigged specifically against the poor. Hillary says the problem that keeps people poor is instead individual bigots — against Blacks, Hispanics, women, gays, etc. Not the system itself. She is proud to represent the system. She’s not against it. She’s for it.

     
    On 18 March 2016, Jason Linkins at Huffington Post bannered “How To Explain Hillary Clinton’s Fundraiser With Failed Theranos CEO Elizabeth Holmes: Scenes from the wreckage of the Democratic party”, and he reported that, “‘At some point,’ [Thomas] Frank tells the Huffington Post, ‘[the Democrats] decided that they weren’t all that interested in the concerns of working people anymore.’ Rather, Frank says, they became fixated on ‘the concerns of the professional class, people with advanced degrees, people at the very top of our economic society.’” Those are the voters whom Hillary Clinton’s policies aim to please. Trump, like Bernie, is pitching to working people. By making economic regulations so complex that only large corporations can afford the costs of compliance with them, more lawyers are needed, and more accountants are needed. By reducing and blocking taxpayer-funded healthcare, more doctors and more bill-collection agencies and more lobbyists are hired at higher salaries, in order to produce any given quality-level of healthcare. 

     

    8:  Sanders’s political career has been financed by small-dollar donations. Hillary’s has been financed by mega-donations.

    Trump’s stated positions are basically like Sanders’s: Trump has stated:
     
     
     
    As regards proposed solutions, Trump’s focus is different from Sanders’s, which proposes both limits on donations, and also total transparency of mega-donations so that the public will accurately know who actually was behind each particular mega-donation. Trump recognizes that the Republicans on the Supreme Court have eliminated the former (size-limits), and that they have also opened up a huge door to increased non-transparency, regarding whom the actual mega-donors to a candidate are. Trump has said:
     
    Hillary Clinton has opposed Sanders’s proposal regarding limiting the size of campaign-contributions, and she has been vague on everything else except “Overturn Citizens United”, which is one of the Republican judges’ decisions (starting with Buckley v. Valeo in 1976) that unleashed mega-donations by declaring that in political campaigns, money is first-amendment-protected “speech,” and that therefore the more money that’s spent advertising any candidate, the more “free speech” there is, and therefore, the better it is. In other words: Clinton has no actual position on money-in-politics (the idea that ‘money is speech’), she has only empty rhetoric, though she’s long been in public office collecting mega-donations. Clinton made it all the way through the primaries against Sanders and never even asserted (as if one can even trust what she says) a coherent position on the matter, other than the bumper-sticker “Overturn Citizens United,” to please liberal fools to vote for her. Meanwhile, the lawyer Glenn Greenwald has pointed out that Hillary was lying, even on the little she says about Citizens United — the one money-in-politics decision she condemns. Greenwald wrote: “The Clinton argument actually goes well beyond the Court’s conservatives: In Citizens United, the right-wing justices merely denied the corrupting effect of independent expenditures (i.e., ones not coordinated with the campaign). But Clinton supporters in 2016 are denying the corrupting effect of direct campaign donations by large banks and corporations and, even worse, huge speaking fees paid to an individual politician shortly before and after that person holds massive political power.” Donald Trump has spoken clearly against all of that — he opposes, in principle, the type of opacity in donations, which the Democratic Party under Clinton encourages; and he also opposes, in principle, the opacity (such as Clinton’s being allowed to hide from the public her 91 paid secret speeches to mega-corporations and to their lobbying organizations). Trump, like Bernie, says the system itself is corrupt and corruptiing. The corruptors don’t like him much more than they liked Bernie. 
     
    The Washington Post headlined on 1 March 2016, “GOP Super PAC’s Ad Portrays Donald Trump as a Predatory Huckster”. The next day, Politico reported:
     
    The effort [by Republican mega-donors against Trump] is centered on the recently formed Our Principles PAC, the latest big-money group airing anti-Trump ads, which is run by GOP strategist Katie Packer, deputy campaign manager for Mitt Romney in 2012. The group, initially funded by $3 million from Marlene Ricketts, wife of billionaire T.D. Ameritrade founder Joe Ricketts, wants to saturate the expensive Florida airwaves ahead of the state’s March 15 primary with hopes of denying Trump a victory that could crush the hopes of home state Sen. Marco Rubio. A conference call on Tuesday to solicit donors for the group included Paul Singer, billionaire founder of hedge fund Elliott Management; Hewlett Packard President and CEO Meg Whitman; and Chicago Cubs co-owner Todd Ricketts, one of Joe and Marlene Ricketts’ three sons. Wealthy Illinois businessman Richard Uihlein is also expected to help fund the effort. Jim Francis, a big GOP donor and bundler from Texas, was also on the phone call on Tuesday 
     
     
    The Washington Post reported that “Money Raised as of June 30” of 2016, produced the following ratios, advantaging Clinton over Trump:
    Ratio of Hillary Clinton Campaign $ divided by Donald Trump campaign $ = 3.21
    Ratio of Clinton Super PACs $ divided by Trump Super PACs $ = 12.71
    18% of Clinton-campaign money came from donations of $200 or less. 27% of Trump-campaign money did. But that 27/18 ratio, of Trump/Clinton small donations, under-represents the true extent to which Trump was being backed by small donations, because Super PACS are almost entirely big-money donations, and an additional $106.8 million of Super PAC money helped Clinton’s campaign, whereas an additional mere $8.4 million of Super PAC money helped Trump’s campaign. Clearly: Clinton attracts the big money; Trump repels it. (He even condemns it.)
     
    With Trump, there is at least the possibility of a President who opposes the existing corrupt-and-corrupting system. With Clinton, there is a long and continuing, thoroughly convincing, record of her participating in, and sustaining, corruption in public office. Her top donors are employed by the companies that benefit the most from complexification of our laws, eliminating simplification, adding counter-productive bureacratization, which crushes everyone but the top 1%.
     

    9:  Sanders favors every possible means of reducing the influence big-money donations to politicians has over politics. Hillary opposes that idea.

    Trump during the Republican primaries was so averse to selling the Presidency to his fellow-billionaires, that he ran his campaign, against his competitors, on a virtual shoestring. After the primaries, he needs lots more money to campaign, especially against Hillary’s campaign that’s funded more heavily than any political campaign in history, from almost every special-interest group (and see here the list of closed-to-the-public speeches she’s given to the various lobbying organizations). She’s offering the U.S. government for sale. Trump is thus-far getting very few billionaires to pony up for his campaign. That’s extraordinary: normally, Republican candidates get even more from mega-donations than Democratic candidates do. However, Trump’s being starved by his fellow-billionaires means that he needs to rely even more heavily upon the Republican Party’s grassroots voting base: especially fundamentalist Christians, gun-rights fanatics, and anti-immigrant voters. The more that he can rely upon Bernie’s voters to win, the less he’ll need to rely upon those traditional Republican groups. If Bernie’s voters show up at the polls for him, this will greatly encourage a future President Trump to surprise the nation with how progressive he actually is. But he can’t afford, right now, to make any overt policy-pitches to Bernie’s voters, because that could scare away lots of the Republican voting-base he’ll definitely need in order to win.
     
    Also, Trump, unlike Sanders, is running in the traditional big-money Party, the Republican Party. Though Sanders was able to be viable while categorically refusing any assistance from Super PACs, Trump wasn’t, and isn’t. Trump, if he wins, will pull the Republican Party toward the “peace and justice” left; congressional Democrats will then need to move along with them in that same direction, in order to be able to retain their existing base. By contrast, a Clinton victory would move the Democratic Party to the right, and then congressional Republicans will need to move even farther to the right, in order to retain their existing voting-base. To move America’s center in the direction of progressivism, Trump is the clear choice.
     
    Hillary Clinton is the Democrats’ deceiver-in-chief; she is actually the Democratic Party’s Richard Nixon. By contrast, the “huckster” Trump is, if anything, too honest for his own good. Maybe he thinks that he’s a good-enough sheer salesman to be able to do that and still win, but he’ll need a lot more support from Bernie-voters in order to make it happen. 
     

    10:  Sanders favors socialized health insurance, like exists in the European nations that spend per-capita half what America does but have higher life-expectancy than America does. Hillary opposes that — she favors the existing profit-based system of health-care, and opposes the European system where basic healthcare is a right, no privilege (that’s based only on ability-to-pay).

    Trump says he favors taxpayer-paid healthcare for Americans who cannot afford to pay for the basic healthcare they need:
     
    “Donald Trump: By the way. Everybody's got to be covered. This is an un-Republican thing for me to say because a lot of times they say, "No, no, the lower 25 percent that can't afford private." But — Scott Pelley: Universal health care? Donald Trump: I am going to take care of everybody. I don't care if it costs me votes or not. Everybody's going to be taken care of much better than they're taken care of now. Scott Pelley: The uninsured person is going to be taken care of how? Donald Trump: They're going to be taken care of. I would make a deal with existing hospitals to take care of people. And, you know what, if this is probably — Scott Pelley: Make a deal? Who pays for it? Donald Trump: — The government's gonna pay for it. But we’re going to save so much money on the other side.”
     
    Here’s what that “so much money on the other side” might refer to:
    The latest OECD data on healthcare costs show that the U.S. spends by far the world’s highest percentage of GDP on healthcare, 16.9 percent; and also show that the average U.S. life expectancy is 78.7 years; by contrast, Canada spends 10.2 percent, and their life expectancy is 81.0 years. The OECD average expenditure is 9.3 percent , and life expectancy is 80.1 years. So: the U.S. spends almost twice as high a percentage of GDP as every other OECD nation, and gets markedly inferior results. This makes the U.S. far less economically competitive than it otherwise would be; but, the healthcare industries finance conservative politicians such as Hillary Clinton, Barack Obama, and all Republicans; so, those politicians don’t like single-payer — it would take much of the excess profits out of exploiting the sick, and those excess profits help to fund their campaigns.
    The American people’s financial losses produce exceptional financial gains for the investors in healthcare-related stocks, and also inflate the pay for executives in those firms. This helps to fund lots of what conservatives such as Antonin Scalia lovingly call “free speech” — campaign commercials.
     
    Here are the latest available data, and they show that, still, the U.S. is somewhat worse than average, for quality of care, and astronomically higher than any nation on both per-capita healthcare costs, and the percentage of GDP that goes to healthcare costs. For examples: across 45 countries tabulated by the OECD, the U.S. healthcare-expenditure per capita was $8,713 and 16.4% of GDP, whereas the average OECD country paid $3,453 and 8.9% of GDP. France paid $4,124 and 10.9% of GDP, and Japan paid $3,713 and 10.2% of GDP. The U.S. also was tied with Brazil, Chile, and South Africa, for having the highest percentage of healthcare-costs that’s paid privately rather than by the government.
     
    In any case, with our existing healthcare-for-profit, instead of healthcare-as-a-right, system, the U.S. ends up paying lots more than our competing nations, yet getting inferior results. (Apparently, postponing care until one is being rushed into an emergency-room is both atrociously poor care, and extremely expensive care. But it’s the most profitable for the healthcare-industries.) 
     
    Trump might have been referring to data such as those. If so, then he was correct about “we’re going to save so much money on the other side.” Hillary’s statements against the European-Canadian-Japanese system — basic healthcare as a right, instead of as a privilege — are false, and she knows it, she simply lies (for money).
     
    Hillary condemns Bernie Sanders’ support of taxpayer-funded health isurance for all (or ‘Medicare for all’ or “single-payer” health insurance). She says, "People who have health emergencies can't wait for us to have a theoretical debate about some better idea that will never, ever come to pass.” (There is no ‘theoretical debate’: many of those other countries do retain a role for private insurance, but not as big a role as ours, and not the same role.) That CBS News story, 29 January 2016, by a reporter who clearly favored Hillary, was headlined “Hillary Clinton: Single-payer health care will ‘never, ever’ happen”, and that reporter summarized by saying, “The debate over health care underscores the difference between Clinton's campaign pitch as a pragmatic, effecitve leader and Sander's pitch as a candidate with vision,” or, in other words, Clinton was saying, and CBS was simply assuming to be true, and not challenging at all: the U.S. must stay with its existing system, which produces lower life-expectancies and twice the cost; Bernie’s belief that we can do what Europe, Japan, etc. have done, is impossible for Americans; our country is too corrupt for that, she’s saying (and CBS reported without questioning or challenging). The CBS news-report continued by approvingly quoting Hillary: “'As someone who has a little bit of experience standing up to the health insurance industry, that spent, you know, many, many millions of dollars attacking me, and probably will so again. … I think it's important to point out that there are a lot of reasons we have the health care system we have today,’ she said. ‘I know how much money influences the political decision-making. … However, we started a system that had private health insurance.’” That news-report closed by quoting, also approvingly, Hillary’s statement in 1994: “‘If, for whatever reason, the Congress doesn't pass health care reform, I believe, and I may be totally off base on this, but I believe that by the year 2000 we will have a single payer system,’ she said. ‘I don't even think it's a close call politically. I think the momentum for a single payer system will sweep the country. … It will be such a huge popular issue … that even if it's not successful the first time, it will eventually be.’” Back in 1994, she was citing single-payer as being a threat — never a goal. Wall Street knows where she stands, even if her voters don’t.
     
    Obamacare continues this status-quo, but adds, to it, more federal and state regulations, which make the system even more complex, and thereby further disadvantages small businesses, in their competing against big ones. Hillary Clinton likes Obamacare, and opposes single-payer health insurance. Back in 2008, she said regarding both her own 1993 Hillarycare proposal, and her then-current 2008 campaign proposal: “I never seriously considered a single payer system. … I think that, you know, there’s too many bells and whistles that Americans want that would not be available.” She said, “Talking about single payer really is a conversation ender for most Americans, because then they become very nervous about socialized medicine and all the rest of this.” However, that too was a lie. She reads polls. Just months earlier, on 14-20 December 2007, an Associated Press/Yahoo poll of 1,523 registered voters, including 847 Democrats and 655 Republicans — about the same proportions Democratic and Republican as the U.S. population generally, at that time — asked respondents whether “the United States should adopt a universal health insurance program in which everyone is covered under a program like Medicare that is run by the government and financed by taxpayers,” and also asked them “Do you consider yourself a supporter of a single-payer health care system, that is a national health plan financed by taxpayers in which all Americans would get their insurance from a single government plan”; and 65 percent said yes to the first, and 54 percent said yes to the second. The public wanted single-payer. Hillary had designed her 1993 Hillarycare proposal for the Health Maintenance Organization (HMO) industry; and she designed her 2008 position for the drug companies and the private insurance companies. Single-payer would replace those big political contributors, which she doesn’t want to do; she wants their money.
     
    What she had said in 1994 about Hillarycare needing to be passed into law because of the danger that “by the year 2000 we will have a single-payer system,” was being said by her in private to the top people at Lehman Brothers Health Corporation. She knew that single-payer was popular and would become more so. Consequently, when she said to the public, in her 2008 Presidential campaign, that “single payer really is a conversation ender for most Americans,” she was just blatantly lying. Her real masters are clear: it’s not the public. She instead treats the public like suckers. (Trump just has a different way of doing it, and evidently not so clearly a malignant purpose for it.)
     
    Furthermore, she implicitly has condemned the Canadian and other nations’ single-payer healthcare systems by saying, “We don’t have one size fits all; our country is quite diverse. What works in New York City won’t work in Albuquerque.” (In 2015, according to the OECD, in 2015, the U.S. spent 16.9% of its GDP on healthcare, and Canada spent 10.2%. Canada also has higher life-expectancy.) Her presumption was that what works in Canada or some other large single-payer country cannot work here — that local control must trump everything in order to fix what’s wrong with American health care. She was implying that our healthcare system delivers superior healthcare at a lower cost than those single-payer countries’. However, as we’ve shown, that too is a lie: we pay more, and get less, and she knows it; she lies.
     
    This is how the Clinton scam works: most of the Democratic Party voters are either totally ignorant of it, or else in denial about it. They think that because she’s not nominally a “Republican,” she’s less right-wing than Republicans are. That’s the reason why she won the votes of enough Democrats to become the nominee: they are fooled by her public rhetoric, and don’t know about her actual record in public office, which is simply atrocious.
     
    A Washington Post interview published on August 11th, was titled “The Donald Trump interview that should terrify national Republicans”, and the questioners there were shocked at the extent to which Trump’s economic proposals reflected Democratic and not Republican economic policies — far more so than Hillary Clinton’s do. Trump in this interview made the distinction between the U.S. government borrowing money at record all-time-low interest rates such as now, versus when interest rates are high, and he said that in a time like this, the repairing and rebuilding of our infrastructure will repay maximum returns for the future, because of those record-low interest-rates. He was proposing to more than double the amount that Hillary Clinton is proposing to spend to restore America’s crumbling infrastructure up to world-class standards, because doing this now will reduce instead of increase costs long-term. “Roads, tunnels, hospitals. I mean, everything. We have to fix the airports. Our airports are like third world countries.” 
     
    The health of the public is America’s human-resources infrastructure (notice that he included there “hospitals”), and Trump — not Hillary — is the candidate who recognizes this fact, and who thinks in this way. It’s something that the great Democrat, Franklin Delano Roosevelt (the creator of Social Security, and of the Works Progress Administration), recognized and put into practice starting in 1938, and immediately the U.S. economy boomed, from then on. The FDR boom didn’t start on December 7, 1941, with World War II; it started when FDR first came into office in 1933, and really sped up in 1938 going full speed ahead with Keynesianism. (Keynes’s theory wasn’t even published until 1936.) Trump is correct to say (in effect) that now is the time for FDR2 — not another Herbert Hoover (or, since Hillary is corrupt, Warren Harding).
     
    *  *  *
     
    My vote for Trump will be the first Republican vote in my life, and I hope that this will be the only time in my life when the Democratic candidate is so abysmal that I’ll have to do this. It’s not because I like Trump; it’s because he’s vastly better than the Democratic nominee, whom I consider to be by far the worst Democrat ever. To me, choosing between Trump, who has no political record, and Hillary, who has the worst record in public office of any Democrat ever, is easy. On all other ballot lines, I shall, as always, vote Democratic. In fact, that will be the best way to block from getting to President Trump’s desk the Republican bills that he’ll likely be wanting to sign, such as any bill to eliminate the estate-tax. But I don’t expect that Democrats will at all oppose what might be his boldestprogressive initiatives, such as, perhaps, a European-style healthcare system. If Democrats would block something like that, they’d then be killing their own Party (and cursing their country), and there aren’t many Democrats who are (like Hillary Clinton would be) corrupt enough to carry things quite that far in the conservative direction, as to persist in sustaining healthcare-by-corruption. (As former President Jimmy Carter says of today’s U.S.: “Now it's just an oligarchy with unlimited political bribery being the essence of getting the nominations for president or being elected president.”) Perhaps a President Trump would get so many congressional Democrats and Republicans to vote for a single-payer health insurance proposal, that such a piece of legislation could be signed into law much likelier than if a President Sanders (who would be voted against in Congress by virtually every Republican member) were to be pushing for exactly the same type of legislation and getting only some congressional Democrats (and no Republicans then) to vote for it. Indeed, we all might even turn out to be surprised to find that a President Trump will be the most effective progressive President since FDR. If Democrats control Congress, then he might turn out that way, and become widely revered — and the neoconservatives, who are America’s fascists, will then have to become curses upon some other land, perhaps Israel, because they wouldn’t be able, any more, to make life hell for Americans (such as by our invading Iraq and Libya). They’ll then be like the Soviet Union’s die-hard communists were, after communism ended: failed ‘prophets’ without a country.
     
    Hillary Clinton’s constant refrain against Trump is that he’s a racist. However, as the progressive John V. Walsh argued, on 29 December 2015, in a superb essay, “Who Is the Arch Racist: The Donald or Hillary?” the answer to that question is clearly Clinton, not clearly Trump, despite Trump’s frequent use of racist rhetoric in order to hold enough of the Republican base to be able to win the election. Anyone who believes what either of the two candidates asserts is believing a confirmed and persistent liar, but only Hillary is a consistent liar for the biggest-money interests. With Trump, we really don’t know what his policies would be, because he has no record in public office, but with Hillary Clinton, we do — and it’s truly horrific. 
     
    John Pilger said, “Trump's views on migration are grotesque, but no more grotesque than those of David Cameron. It is not Trump who is the Great Deporter from the United States, but the Nobel Peace Prize winner, Barack Obama.” (Pilger’s disgust against liars and hypocrites such as Obama, reflects his extraodinarily pure progressivism. Obama has been the most effective — and effectively closeted — Republican President; he has been the ultimate deceiver. For example, Blacks have actually lost wealth under Obama, the most of any ethnic group, yet they constantly support him the most of any ethnic group.) And anyone who thinks that Hillary Clinton would be less conservative than Barack Obama has been, is in for a sore disappointment if she becomes the next President. By contrast, a President Donald Trump could well surprise strongly on the upside, because, unlike Hillary, whose record in public office makes clear that she would be horrifying, Trump has no such record at all, and the people who are demonizing him are themselves individuals whose records in public office (or else as journalists) are as despicable as Hillary Clinton’s record is.
     
    Both sides in this election are concentrating on personal attacks against the other, but the ten issues that have been discussed here are vastly more important than, for examples, whether Donald Trump (and/or Bill Clinton) is a rapist (or whether Hillary Clinton hired thugs to make life hell for Bill’s rape-victims), or whether the Trump University scam from which Trump profited, is worse than the Laureate International Universities scam from which Bill and Hillary Clinton profited. At the economic top in America, is unimaginable corruption and rampant psychopathy; and, so, one can reasonably question whether this nation is still a democracy at all, but the scummiest people have funded Hillary Clinton’s career, vastly more than Donald Trump’s. Hillary owes a lot of billionaires a lot of money on their investments in her. Trump does not. 
     
    We’re going to be placing this country into the hands of either Hillary Clinton’s enemies, or else Donald Trump’s enemies, and the latter group are by far the worse of the two. Not to vote, in such a situation, or else to vote for a ‘protest’ candidate and so throw one’s vote away (even if the voting-machine will only be programmed to misreport it), is irresponsible. If America is not a democracy, then, still, a voter’s obligation is to do whatever he or she can in order to maximize the chance that it might become one. As between the two viable options here, Clinton is the clear police-state option, but Trump might possibly fight to restore America’s democracy. The choice of Trump over Clinton is easy to make, because, even in the reasonable worst-case scenario, the damage Trump would likely cause the country (and the world) is vastly less than the damage — nuclear war against Russia — that Clinton would likely cause. This is certainly no ‘Tweedledee, Tweedledum’ election. Not even close to that.
     
     
    By voting for Trump, you add 1 vote to him, and 0 vote to Hillary, and so that’s a real action in the real world of electoral politics: it puts Trump up 1. By voting for Hillary, you add 1 vote to her, and 0 vote to Trump, and so that too is a real action in the real world of electoral politics: it puts Hillary up 1. Either vote is a real vote.
     
    *  *  *

    The real world of electoral politics is the foundation of democracy, without which it can’t function at all. Fantasy votes are not votes that can even possibly participate in democracy. For example: by voting instead for Jill Stein, you add 0 vote to each of the two real-world contestants, just the same as you would be doing by staying home on Election Day.

     
    Regarding the question of whether voting for Jill Stein is at all rational:
     
    The U.S. Presidency is determined in the Electoral College, in which each state’s entire delegation votes the given state’s Election-Day choice, winner-take-all for all of that state’s electors.
     
    Neither Nader nor Perot won even one state, neither of them came even close to winning even a single state.
     
    Jill Stein definitely won’t win even one state.
     
    Voting for her is nothing but a sucker-punch on the ballot there.
     
    When Nader ran, and received 2.74% of the nationwide vote at his peak in 2000, he was on the ballot in 49 states, yet still he won not even a single state. Instead, because he drew off more than enough Gore voters in both New Hampshire and Florida so as to throw NH to Bush and to cause FL to be so close that the outcome there was decided by the 5-4 Republican-majority of the U.S. Supreme Court, Nader made George W. Bush President. If Nader hadn’t been on the FL ballot and drawn 97,488 votes there, Gore would have won FL decisively; Bush’s ‘537 vote win’ couldn’t even possibly have occurred, because Gore’s winning margin there would have precluded any recount at all. (Gore would have won FL by around ten thousand votes.) There would have been no invasion of Iraq. The problem of global warming wouldn’t have been shunted off to the side, as it was by Bush.
     
    Furthermore, Nader also threw NH to Bush, and Gore would have won the Presidency even if only one of those two states, NH and FL, hadn’t been thrown to Bush by Nader. Bush needed both of those two states in order to eke out his 271-266-vote win of the Electoral College, and that’s what Nader’s participation in the contest handed Bush — both states. Nader sucked away enough voter-fools, most of them to the left of center, so as to move the electoral result (the electoral advantage) far to the right of center.
     
    In a Presidential system such as the U.S. (though not in a parliamentary system), only fools vote third-party. These people are either so ignorant they can’t count, or so stupid they think that to ‘register a protest’ is somehow more patriotic than to register a vote that might make an actual difference in the resulting winner, the resulting President.
     
    The stakes in the current election are actually huge: the Tweedledee Tweedledom argument certainly doesn’t apply here (neither did it apply in 2000) to excuse a voter from really participating in the ultimate outcome. It’s our duty to vote only for candidates who might possibly win, even if the electoral system is rigged (such as it is in Iran, to eliminate from having even a real chance to win the Presidency, all candidates who are so good they’d pose a threat to the behind-the-scenes dictators). If the electoral system is rigged, voting is the only way to protest, that has even a possibility of being effective (unless a violent revolution might improve matters, which seems unlikely here). To be a fool is never good. It harms everyone. It’s certainly not an ethical choice, if anyone actually chooses it. (Of course, if the person is too stupid to be said to ‘choose’ it, then one can’t blame the person, but merely feel sorry for his unintended victims.) 
     
    The only realistic choice that is offered is either Clinton or else Trump. Even if it’s a choice between two bad candidates, one of them is far worse than is the other. With Trump as President, there is a realistic possibility of getting a reasonably good President, someone who won enough independents and fooled enough Republicans, to enable him to win the Republican Party’s nomination. With Clinton as President, there’s a realistic possibility of nuclear war with Russia, but a virtual certaintly that this nation will be ruled behind-the-scenes, by-and-for America’s international corporations. That is the real choice we have, if we have any at all. Fantasists have the freedom to stay with their fictions, but realists are obliged not to. Realism is a prerequisite to progressivism. Trump is the clear, and the only reasonable, choice for progressives in this election.
     
    Our choice, Bernie, didn’t make it to the finals. (Hillary and her big-money people beat him — sometimes cheated him.) We are stunningly fortunate that the voters in the other Party’s primaries ended up giving us (for once) a realistic chance to have, as the next U.S. President, a person who is at least no worse than, and is on many of the most important issues far better than, the atrocity (Hillary) that is being offered to us by the Democratic Party. How often does the Republican Party provide the better candidate? In the opinion of this Bernie-supporter, such a thing has never happened since the time of Abraham Lincoln. Donald Trump might not be another Abraham Lincoln, but he might be another Franklin Delano Roosevelt — the greatest progressive of them all. Thank you, Donald Trump, for having given us this opportunity — the realistic possibility to salvage, for America, a progressive future. It couldn’t have happened without you — if it does happen, at all.
     
    On September 16th, the conservative Ramesh Ponnuru headlined an op-ed at Bloomberg News, “Trump Throws Out the Republican Litmus Tests”, and he wrote about what The Week magazine titled “The End of Republican Dogma?” Ponnuru said:
    “Over the span of two days, the Republican nominee for president has proposed new child-care subsidies, new mandatory benefits to be provided by business, the removal of millions of families from the income-tax rolls, and an increase in tax rates on single people making from $112,500 to $190,000 a year. Oh, and he put in a good word for Medicaid too, leaving the impression with many people that he favors expanding it. … None of these positions seem to be costing him any of his supporters, just as his opposition to entitlement reform and free trade did not keep him from winning the Republican nomination. … He has exercised more [ideological] freedom than Republican politicians dreamed they had. For years, they have been complaining that purists had imposed a series of litmus tests that kept their party from winning elections or governing well. … That stranglehold now appears to be broken.”
    Trump is rapidly moving America’s political center in the opposite direction from the direction that Bill Clinton, Barack Obama, and Hillary Clinton, did, which was toward conservatism, away from progressivism: those conservative Democratic Presidents and (now) would-be President, have moved America’s political center considerably toward the right (the international-corporate agenda). A President Trump would reverse the political direction that this country has been heading in ever since 1993.

    If we progressives don’t help Trump to do that, we shall be throwing away the only such opportunity that the U.S. oligarchy (slipped-up and) allowed us to have. A President Hillary Clinton would have the support of almost all congressional Democrats no matter how right-wing her proposals are, and her big-money financial backers will buy enough congressional Republicans to make her the most effective most conservative Democratic President in decades if not centuries. The prospect is chilling.

    *  *  *

  • Meanwhile, Saudi Stocks Crash Near 7 Year Lows

    Despite the Deutsche-driven bounce in Western markets on Friday, the 'panic in The Kingdom' that we highlighted earlier in the week is accelerating fast. Following demands from officials for banks to reschedule loans to clients affected by last week's decision to cut salaries and bonuses for state employees, Middle-East bank stocks are collapsing and Saudi's Tadawul Index is back near its 2009 lows

    The weakness – despite crude strength – was driven by Saudi Arabia’s central bank decision to direct local lenders to reschedule the consumer loans of clients affected by last week’s decision to scrap the bonuses and allowances of many state employees. As Bloomberg reports,

    The Saudi Arabian Monetary Agency, as the central bank is known, said in a statement on its website on Sunday that the step was part of efforts to “reduce pressure on borrowers” whose income was cut by the government’s Sept. 26 package of measures to further trim spending.

     

    The agency said local banks must obtain the client’s approval before rescheduling a loan. Borrowers should present proof that their income has been affected by the recent cuts to the nearest bank branch, the regulator said. Loans taken after the cabinet decision to end the payments won’t be rescheduled.

     

    Under Deputy Crown Prince Mohammed bin Salman, the world’s biggest oil exporter has already delayed payments owed to contractors and started cutting fuel subsidies as it tries to manage lower oil prices. The measures may help narrow the budget deficit to 13 percent of gross domestic product this year and below 10 percent in 2017, according to International Monetary Fund estimates.

     

    The cancellation of bonuses and allowances — and a simultaneous decision to lower ministers’ salaries by 20 percent — further spread the burden of shoring up public finances to a population accustomed to years of government largesse. Yet analysts have warned the cuts risk deepening the kingdom’s economic slowdown by damaging consumer confidence.

    Which collapsed Saudi banking stocks to record lows…

     

    And trust is rapidly being lost in the Saudi interbank markets…

     

    And this is a major problem…

    No help at all as oil prices rebounce post-Algiers.

    As the forward market implies dramatic devaluation is looming…

     

    And investors are loading up on record amounts of CDS protection (red line)…

     

    Charts: Bloomberg

  • Here's Why You May Want To Tiptoe Out Before The Party Ends

    Submitted by The Wall Street Examiner's Lee Adler, via Contra Corner blog,

    Private spending on capital goods is a measure of business confidence in the economy. If business people believe the economy will grow, they invest more in plant and equipment. If they are not optimistic, they pull in their horns. This week’s Commerce Department report on Durable Goods orders contains a nugget or two that help us to see how business people are behaving in that regard.

    The picture isn’t good. Apparently business people have been growing less confident in the growth potential of the US economy for the past 16 years. That belief, and the reduction in investment that follows from that belief, runs the risk of being a self fulfilling prophecy. This isn’t just a long term phenomenon. Business investment in capital goods has been flat since 2011, and has been declining for the past 2 years. Meanwhile, over the 5 years that growth in business capital spending has stalled, stock prices went to the moon. The disconnect matters.

    Real Nondefense Capital Goods and Stock Prices - Click to enlarge

    Capital goods have a limited life. Most need replacement within 10 years. If such replacement is delayed, as was the case during the 2008-09 crash and depression, a strong rebound is inevitable.   Replacement can only be delayed for so long, until pent up demand reaches the point where it begins to actualize.

    This is inherent in the natural business cycle. Such rebounds do not require 0% interest rates to occur. Economists and central bankers may argue that ZIRP was needed to trigger such a turn in 2009, but the turn would have come whether rates were 0% or 5%. They always did so in the past, and would have done so again in 2009. The recovery that began in 2002 was a case in point.

    Real Nondefense Capital Goods and Fed Funds 1999-2006 - Click to enlarge

    Even assuming ZIRP was needed as a trigger, after a few months it would no longer have been. In fact, 0% interest rates have had no effect since that initial rebound. The growth phase slowed in 2012, settled into a trend of replacement only, with zero growth, and then began to steadily contract in late 2014, a trend that remains in force today.

    Real Nondefense Capital Goods and Fed Funds - Click to enlarge

    It appears that since 2011 we have gone through an entire business cycle with rates pinned at zero for no reason. The Fed has put us in a box. It can no longer even pretend to enhance a rebound by lowering rates.

    Capital goods aren’t the only aspect of business investment. In addition to equipment, there’s also physical plant, that is, the buildings that house the business, whether commercial, industrial, retail, or service. To get an idea whether investment in buildings changed the picture any, I created a combined index of non defense capital goods plus private investment in commercial and industrial property. I converted that index to real terms using the PPI for construction.

    The housing bubble generated a commercial construction bubble that sent total real business investment to a record high in 2008. But the crash followed and the recovery was weak, fizzling out altogether in 2014. Real investment is now down 5% over the last 2 years, and by 20% since 2008 when real business investment hit its lagging peak. Compare that to the current 49% gain in stock prices from the 2007 peak to the August 2016 level. It’s hard to fathom any rationale for a 49% rise in stock prices while real business investment has shrunk by 20%.

    Real Business Investment and Stock Prices - Click to enlarge

    There should be a connection between business investment and Commercial and Industrial Loans. Businesses typically borrow the funds for purchases of equipment or to fund construction of physical plant. From 1999 through 2014, such borrowing moved roughly concurrently with business investment. Not only the timing, but the relative directions were similar. But in 2012 the relative directions of the curves of the two series began to diverge as growth in business investment slowed while C&I Loans soared. In 2014-15, the normal relationship became completely unhinged. Businesses pulled in their horns in making real investments, but they continued to increase their borrowing exponentially.

    Business borrowing had always tracked real business investment until 2014. Then businesses stopped investing in plant and equipment. But they continued borrowing at a breakneck pace. It was as if the borrowed funds were disappearing into a black hole. But in spite of there apparently being no tangible assets to back the new borrowing, banks have been all too happy to take the business. The credit bubble has been expanding at a breathtaking pace as a result.

    At one point in early 2015 C&I lending was growing at a  13% annual rate. That has only slowed to a 9.5% growth rate today while real business investment has been shrinking.

    Where’s it going? We should all know the answer to that question by now. Driven by ZIRP and massive amounts of excess cash in the system, corporations are borrowing to buy back their own stocks. CEOs, CFOs, and their fellow executives conspire to issue massive stock option grants to themselves. Then the have their companies borrow the funds for free to buy the stock issued under those option grants. They shrink the shares outstanding and drive their stock prices higher in the process. As they raid their companies, everybody’s happy because their stock prices go higher. Corporate boards and regulatory bodies do nothing to stop the looting because the scam looks like a win win for everybody.

    Real Business Investment and Commercial and Industrial Loans - Click to enlarge

    But it’s not. It’s just another massive bubble, a financial engineering bubble. It is a bubble driven by the cold calculations of the criminal masterminds in the C-suites of America’s corporations. It is a bubble enabled and funded by the mass insanity of central bankers and clueless investors around the world. And it is a bubble egged on by the cheerleaders on Wall Street and their financial media handmaidens.

    Stock Prices, Real Business Investment and Commercial and Industrial Loans - Click to enlarge

    So party on, Garth! Party on! But you might want to consider tiptoeing out the back door before they lock the exits.

  • WSJ Reports "No Settlement Deal" Between Deutsche, DOJ As German Econ Minister Slams Deutsche Bank

    As we predicted on Friday, and as we reported earlier today, the AFP “story” of a $5.4 billion revised settlement between DB and DOJ was indeed “sources” on Twitter, and had no basis in reality. The reason: not only has John Cryan barely started the negotiations with the DOJ, and is set to arrive in the US this week to beg for mercy, but as the WSJ, which broke the original settlement story more than two weeks ago just reported, Deutsche Bank’s settlement talks with the DOJ are continuing, “with no deal yet presented to senior decision makers for approval on either side.

    The talks are moving forward, but they have “not progressed to a degree that a proposed deal has reached senior-level review at the Justice Department or with Deutsche Bank’s supervisory board, people familiar with the matter said.”

    While there is much more information one could hope for in what is now the most important litigation in capital markets, we will gladly take what the WSJ reports over the market-manipulating garbage spewed by AFP with the sole intent of getting both DB and the market to close higher.

    Some more details from the WSJ:

    “People familiar with the continuing settlement talks say details remain in flux. Justice Department lawyers have floated the possibility of also reaching accords with other European banks who have yet to resolve similar investigations and announce them at once, but no such move is certain, the people say.”

    The WSJ also adds that CEO John Cryan plans to be in Washington, D.C. this week for meetings of the International Monetary Fund and World Bank. The visit has stoked speculation that he could delve in person into ongoing talks with the Justice Department. The Deutsche Bank spokesman declined to comment on any matters related to talks with Justice Department.

    Meanwhile, as Deutsche ponders what rumors it will have to unleash tomorrow to provide another much needed boost to the stock, especially if the market sells off on today’s denial of the settlement speculation, German Economy Minister Sigmar Gabriel accused Deutsche Bank on Sunday of blaming speculators for last week’s plunge in its share price when the bank had itself made speculation its business.

    Cited by Reuters, he said thatI did not know if I should laugh or cry that the bank that made speculation a business model is now saying it is a victim of speculators,” Gabriel told reporters on a plane to Iran, which he is visiting with a business delegation.

    That does not sound like the soothing words of a government willing to backstop its biggest lender.

    Gabriel, who is also leader of the Social Democrats the junior partner in Angela Merkel’s coalition government, also said he was worried about those who were employed by the lender. As Reuters repeats, the problems of Deutsche Bank are awkward for Berlin, which has berated many euro zone peers for economic mismanagement and taken a hard line on other EU nations giving state aid to bail out their problem banks.

    Last week the German finance ministry moved swiftly to dismiss a report that a government rescue plan was being prepared in case Deutsche Bank was unable to raise sufficient new capital to settle litigation which includes cases dating back to its expansion before the financial crisis.

    However, if now that the rumors of a revised settlement have been taken off the table if only for the time being, and if the selling once again resumes – if for no other reason that to prompt precisely such a discounted settlement borne out of existential fears for the German bank – the German finance ministry may find itself busy once again: on one hand denying it would bailout Deutsche Bank, on the other scrambling to round up all possible resources – listed in a previous post – to boost confidence in the German bank, just in case another fake rumor of an imminent “fix” doesn’t restore the public’s, and counterparties’, confidence in the ailing lender with tens of trillions of derivatives on its books.

  • David Stockman: America Now Lives Under A "Perverted Regime"

    Submitted by Adam Taggart via PeakProsperity.com,

    The rise of Trump – and Bernie Sanders too – vastly transcends ordinary politics. In fact, it reaches deep into a ruined national economy that has morphed into rank casino capitalism under the misguided policies and faithless rule of the Washington and Wall Street elites.
     
    This epic deformation has delivered historically unprecedented set-backs to the bottom 90% of American households. They have seen their real wealth and living standards steadily deteriorate for several decades now, even as vast financial windfalls have accrued to the elite few at the very top.
     
    In fact, during the last 30 years, the real net worth of the bottom 90% has not increased at all. At the same time, the top 1% has experienced a 300% gain while the real wealth of the Forbes 400 has risen by 1,000%.
     
    That’s not old-fashioned capitalism at work; it’s the fruit of a perverted regime of printing press money and debt-fueled faux prosperity that has been foisted on the nation by the bipartisan ruling elites.
     
    To be sure, the proximate cause of this year’s election upheaval is similar to that in Reagan’s time. Back then, an era of drastic bipartisan mis-governance generated an electoral impulse to sweep out the Washington stables.
     
    Now, however, it is not just the Beltway political class that is under attack. The very foundations of American economic life are imperiled. What remained of healthy market capitalism in Reagan’s time is no more.
     
    It has been battered by 30 years of madcap money printing at the Fed. It labors under the $50 trillion of new public and private debt generated by that monetary eruption. And it staggers from the destructive blows of serial financial bubbles.
     
    These bubbles have self-evidently resulted in a destructive boom-and-bust cycle in the financial system, but also much more. Bubble Finance has drained productivity and efficiency from the Main Street economy and has channeled vast resources to speculators and wasteful malinvestments.
     
    ~ "Trumped!" by David Stockman

    David Stockman, former director of the OMB under President Reagan, former US Representative, and veteran financier is an insider's insider. Few people understand the ways in which both Washington DC and Wall Street work and intersect better than he does.

    In his upcoming book, Trumped! A Nation on the Brink of Ruin…And How to Bring it Back, Stockman lays out how we have devolved from a free market economy into a managed one that operates for the benefit of a privileged few. And when trouble arises, these few are bailed out at the expense of the public good.

    Stockman brings us his report of what 30 years of politics, degenerative crony capitalism and “bubble finance” have finally wrought. The upheaval and crossroads represented by Donald Trump’s candidacy spell economic disaster or resurgence, depending on the steps America chooses to take from here:

    This election is enormously important but it’s not entirely about the candidates, per se, but about the fact that much of the country is beginning to recognize that we’ve been on the wrong path for a long time and we’re reaching a dead end. And that’s why, you know, on the cover of this new book, I have a map of America and the east and west coast are colored, shaded, and the vast area in between is in white. I call it Flyover America.

     

    And part of the book is to try to explain the phenomena of the Trump campaign, which came out of nowhere, and why there seems to be such an unexpected ground swell of economically driven support. Of course, the elite media wants to blame it on racism and xenophobia and, you know, small-mindedness of one type or another. But I think the underlying driver here, the underlying alienation comes from an economic policy that has benefitted enormously the bicoastal elites and we go through that, a very small share of the population that lives off finance venture capital and the enormous expansion of the warfare state and welfare state in Washington. Versus the rest of America – call it the 90% to use a general term.

     

    But the thing that I try to demonstrate in the book is that since 1987 when Greenspan arrived at the Fed in this era of bubble finances I call it incepted, we basically have a bifurcated economy. The bottom 90% of the population has no more real net worth today if you use an honest inflation measure to deflate nominal values. It has no more net worth today than it did in 1987. That’s nearly 30 years of going nowhere. The top 1% has gained 300% in net worth, which the Forbes 400 to take the final clip on this, is 1,000% gain.

     

    Now, that’s not market capitalism at work. That is a, as I called it, a deformed or mutant system of crony capitalism and finance-driven economic life coming right out of the central bank and that whole complex of unsound policy that has produced a result that is very unsustainable. Not only has there been no net worth gain as we lay out in the book but if you just go to the year 2000, real median household income – again, deflated with, I think, an accurate measure of the cost of living faced by most households – is down nearly 20% from where it was when Bill Clinton was shuffling out of the White House.

    Click the play button below to listen to Chris' interview with David Stockman (49m:26s)…

  • JPMorgan Joins Yellen and Summers In Hinting The Fed May Buy Stocks Next

    During her latest testimony in Congress, when asked by rep Mick Mulvaney if the Fed has considered buying equities, Janet Yellen had a cryptic, yet open to interpretation answer: “the Federal Reserve is not permitted to purchase equities. We can only purchase U.S. treasuries and agency securities. I did mention in a speech in Jackson Hole, though, where I discussed longer term issues and difficulties we could have in providing adequate monetary policy. Accommodation may be somewhere in the future, down the line that this is the kind of thing that Congress might consider.”

    Then, the very next day, during a video conference Q&A, Yellen once again unexpectedly latched on to the topic of the Fed buying stocks, saying that “the idea of expanding into areas like equities might be “good thing to think about,” noting that (for now) The Fed is more restricted in which assets it can purchase than other central banks. If we found, I think as other countries did, that they could reach the limits in terms of purchasing safe assets like longer-term government bonds, it could be useful to be able to intervene directly in assets where the prices have a more direct link to spending decisions.

    Assets such as equities.

    Then, jumping on to the idea of nationalizing the stock market, none other than the world’s most farcical former econopundit, Larry Summers, who has plunged to such recent depths he has to retweet himself on Twitter to get page views for his blog, “floated the idea of continuous purchases of stocks as a potential ingredient in a recipe for the developed world to strengthen economies struggling with subdued growth and inflation.”

    Cited by Bloomberg, Summer said that among the proposals that deserve “serious reflection” is the purchase of a “wider range of assets on a sustained and continuing basis,” Summers said in a lecture at a Bank of Japan conference in Tokyo Friday. “I’m not prepared to make a policy recommendation at this point,” he told reporters later.

    It got even funnier when Summers said that “there are obviously important political and economic questions associated with government ownership of companies,” adding that “some critics could term such a policy as “socialism, while others could highlight that governments already buy stocks in other ways, such as in the U.S. for federal employee pension funds.

    Still others could term such a policy as utter idiocy, because once a price-indiscriminate entity is unleashed on stocks directly and legally (as opposed to the current framework whereby the Fed merely intervenes by way of its HFT proxy, Citadel, at key inflection points to break selling momentum), it is game over for price discovery and for the concept of capitalism.

    However, one would not find JPM among the “others.” In a note released on Friday, the otherwise serious commentator Nick Panigirtzoglou, author of the closely followed “Flows and Liquidity” weekly publication, when discussing the limits of QE – a topic prominently touched upon by Bridgewater this past week, said the following:

    How big are the QE capacity constraints facing central banks? One of the arguments put forward by some in explaining the BoJ’s shift away from QE to yield targeting is for the BoJ to avoid finding itself in the same position as the ECB is currently: i.e. facing a QE cliff at a not too distant point in the future.

     

    We believe that QE constraints are rather artificial. One of the channels via which QE operates is via bolstering the capacity of debt capital markets. Indeed, this year’s big increase in spread product supply coincided with more QE by the ECB and the BoJ relative to the previous year. More bond issuance not only implies more credit creation, helping the economy, but also more QE capacity allowing central banks to purchase more assets in the future.

     

    But QE need not be confined to bond instruments in our mind. By limiting themselves to bonds, central banks are indeed deemed to face quantitative constraints given declining government bond issuance even as spread product issuance has increased. This year’s purchases by the ECB, BoJ and the BoE account for 75% of total net bond issuance globally excluding EM local debt.

    And there you have it: first, a central banker, then a still somewhat prominent (if recently discredited) economist, and now a respected sell-side analyst, have all jumped on the “Fed should buy equities” bandwagon. We point this out just because it increasingly appears that the Fed is launching trial balloons at what its next, emergency policy may be at a time when the US central bank should, according to experts, be getting ready to hike rates. Which is why, something tells us that the market’s 59% odds of a December rate hike as of December will be, as usually, dramatically wrong.

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Today’s News 2nd October 2016

  • Paul Craig Roberts Urges "Bring Back The Cold War"

    Authored by Paul Craig Roberts,

    Pundits have declared a “New Cold War.” If only! The Cold War was a time when leaders focused on reducing tensions between nuclear powers. What we have today is much more dangerous: Washington’s reckless and irresponsible aggression toward the other major nuclear powers, Russia and China.

    During my lifetime American presidents worked to defuse tensions with Russia. President John F. Kennedy worked with Khrushchev to defuse the Cuban Missile Crisis. President Richard Nixon negotiated SALT I and the anti-ballistic missile treaty, and Nixon opened to Communist China. President Carter negotiated SALT II. Reagan worked with Soviet leader Gorbachev and ended the Cold War. The Berlin Wall came down. Gorbachev was promised that in exchange for the Soviet Union’s agreement to the reunification of Germany, NATO would not move one inch to the East.

    Peace was at hand. And then the neoconservatives, rehabilitated by the Israeli influence in the American press, went to work to destroy the peace that Reagan and Gorbachev had achieved. It was a short-lasting peace. Peace is costly to the profits of the military/security complex. Washington’s gigantic military and security interests are far more powerful than the peace lobby.

    Since the advent of the criminal Clinton regime, every American president has worked overtime to raise tensions with Russia and China.

    China is confronted with the crazed and criminal Obama regime’s declaration of the “pivot to Asia” and the prospect of the US Navy controlling the sea lanes that provision China.

    Russia is even more dangerously threatened with US nuclear missile bases on her border and with US and NATO military bases stretching from the Baltics to the Black Sea.

    Russia is also threatened with endless provocations and with demonization that is clearly intended to prepare Western peoples for war against “the Russian threat.” Extreme and hostile words stream from the mouth of the Democratic presidential candidate, Hillary Clinton, who has called the president of Russia “the new Hitler” and threatened Russia with military force. Insouciant Americans are capable of electing this warmonger who would bring Armageddon upon the earth.

    Yesterday, Israel’s voice in the US, the New York Times, added to Hillary’s demonization of the most responsible leader in the world with this editorial: “Vladimir Putin’s Outlaw State.” This irresponsible and propagandistic editorial, no doubt written by the neoconservatives, blames all the troubles in Ukraine and Syria on Putin. The NYT presstitutes know that they have no case, so they drag in the US-orchestrated false report on MH-17 recently released by Washington’s Netherlands vassal.

    This report is so absurd as to cast doubt on whether intelligence exists anywhere in the Western world. Russia and the now independent Russian provinces that have separated from Ukraine have no interest whatsoever in shooting down a Malaysian airliner. But despite this fact, Russia, according to the orchestrated report, sent a surface-to-air missile, useful only at high altitude, an altitude far higher than the Ukrainian planes fly that are attacking Russians in the separated republics, to the “rebels” so that the “rebels” could shoot down a Malaysian airliner. Then the missile system was sent back to Russia.

    How insouciant does a person have to be to believe this propaganda from the New York Times?

    Does the New York Times write this nonsense because it is bankrupt and lives on CIA subsidies?

    It is obvious that the Malaysian airliner was destroyed for the purpose of blaming Russia so that Washington could force Europe to cooperate in applying illegal sanctions on Russia in an attempt to destabilize Russia, a country that placed itself in the way of Washington’s determination to destabilize Syria and Iran.

    In a recent speech, the mindless cipher, who in his role as US Secretary of Defense serves as a front man for the armaments industry, declared the one trillion dollars (1,000 billion dollars or 1,000,000 million dollars, that is, one million dollars one million times) that Washington is going to spend of Americans’ money for nuclear force renewal is so we can “get up in the morning to go to school, to go to work, to live our lives, to dream our dreams and to give our children a better future.”

    But Russia’s response to this buildup in Washington’s strategic nuclear weapons is, according to Defense Secretary Aston B. Carter, “saber rattling” that “raises serious questions about Russia’s leaders commitment to strategic stability.”

    Do you get the picture? Or are you an insouciant American? Washington’s buildup is only so that we can get up in the morning and go to school and work, but Russia’s buildup in response to Washington’s buildup upsets “strategic stability.”

    What the Pentagon chief means is that Russia is supposed to sit there and let Washington gain the upper hand so Washington can maintain “strategic stability” by dictating to Russia. By not letting Washington prevail, Russia is upsetting “strategic stability.”

    US Secretary of State John Kerry, who has been broken and tamed by the neoconservatives, recently displayed the same point of view with his “ultimatum” to Russian Foreign Minister Sergey Lavrov. In effect, Kerry told Lavrov that Russia must stop helping Syria resist the jihadist forces and allow the US-supported ISIS to regain the initiative and reduce Syria to the chaos in which Washington left Libya and Iraq. Otherwise, Kerry said that the agreement to cooperate is off.

    There can be no cooperation between the US and Russia over Syria, because the two government’s goals are entirely different. Russia wants to defeat ISIS, and the US wants to use ISIS to overthrow Assad. This should be clear to the Russians. Yet they still enter into “agreements” that Washington has no intention of keeping. Washington breaks the agreements and blames Russia, thus creating more opportunities to paint Russia as untrustworthy. Without Russia’s cooperation in setting themselves up for blame, Russia’s portrait would not be so black.

    On September 28, 2016, the New York Times gave us a good example of how Washington’s propaganda system works.

    The headline set the stage: “Russia’s Brutal Bombing of Aleppo May Be Calculated, and It May Be Working.” According to the NYT report, Russia was not bombing ISIS. Russia was “destroying hospitals and schools, choking off basic supplies, and killing aid workers and hundreds of civilians.”

     

    The NYT asks: “What could possibly motivate such brutality?”

     

    The NYT answers: Russia is “massacring Aleppo’s civilians as part of a calculated strategy . . . designed to pressure [moderates] to ally themselves with extremists,” thereby discrediting the forces that Washington has sent to overthrow Syria and to reduce the country to chaos.

    When America’s Newspaper of Record is nothing but a propaganda ministry, what is America?

    Pundits keep explaining that Washington’s 15 year old wars in the Middle East are about controlling the routing of energy pipelines. Little doubt this is a factor as it brings on board powerful American energy and financial interests. But this is not the motive for the wars. Washington, or the neoconservatives who control the US government, intend to destabilize the Russian Federation, the former Soviet Central Asian countries, and China’s Muslim province by adding Syria and then Iran to the chaos that Washington has created in Iraq and Libya. If Washington succeeds in destroying Syria as it succeeded in destroying Libya and Iraq, Iran becomes the last buffer for Russia. If Washington then knocks off Iran, Russia is set up for destabilization by jihadists operating in Muslim regions of the Russian Federation.

    This is clear as day. Putin understands this. But Russia, which existed under Washington’s domination during the Yeltsin years, has been left threatened by Washington’s Fifth Columns in Russia. There are a large number of foreign-financed NGOs in Russia that Putin finally realized were Washington’s agents. These Washington operatives have been made to register as foreign-financed, but they are still functioning.

    Russia is also betrayed by a section of its elite who are allied economically, politically, and emotionally with Washington. I have termed these Russians “America Worshipers.” Their over-riding cause is to have Russia integrated with the West, which means to be a vassal of Washington.

    Washington’s money even seems to have found its way into Russian “think tanks” and academic institutions. According to this report, two think tanks, one Russian one American, possibly funded by Washington’s money, have concluded that “US,Russia ‘Have far more common interests than differences’ in Asia-Pacific.”

    This “academic report” is a direct assault on the Russian/Chinese alliance. It makes one wonder whether the report was funded by the CIA. The Russian media fall for the “common interest” propaganda, because they desire to be included in the West. Like Russian academics, the Russian media know English, not Chinese. Russia’s history since Peter the Great is with the West. So that is where they want to be. However, these America Worshipping Russians cannot understand that to be part of the West means being Washington’s vassal, or if they do understand the price, they are content with a vassal’s status like Germany, Great Britain, France, and the rest of the European puppet states.

    To be a vassal is not an unusual choice in history. For example, many peoples chose to be Rome’s vassals, so those elements in Russia who desire to be Washington’s vassal have precedents for their decision.

    To reduce Russia’s status to Washington’s vassal, we have Russian-US cooperation between the Moscow-based Institute of World Economy and International Relations and the US-based International Institute for Strategic Studies. These two co-conspirators against Russian sovereignty are working to destroy Russia’s strategic alliance with China and to create a US-Russian Pacific Alliance in its place. One of the benefits, the joint report declares, is “maintaining freedom of navigation and maritime security.”

    “Freedom of navigation” is Washington’s term for controlling the sea lanes that supply China. So now we have a Russian institute supporting Washington’s plans to cut off resource flow into China. This idiocy on the part of the Moscow-based Institute of World Economy and International Relations is unlikely to reassure China about its alliance with Russia. If the alliance is broken, Washington can more easily deal with the two constraints on its unilateralism.

    Additionally, the joint report says that Moscow could cooperate with Washington in confidence-building measures to resolve territorial disputes in the Asia-Pacific region. What this means is that Russia should help Washington pressure China to give up its territorial claims.

    One cannot but wonder if the Moscow-based Institute of World Economy and International Relations is a CIA front. If it is not, the CIA is getting a free ride.

    The foreign policy of the United States rests entirely on propagandistic lies. The presstitute media, a Ministry of Propaganda, establishes an orchestrated reality by treating lies as fact. News organizations around the world, accustomed as they are to following Washington’s lead, echo the lies as if they are facts.

    Thus Washington’s lies–such as Saddam Hussein’s weapons of mass destruction, Iranian nukes, Assad’s use of chemical weapons, Russian invasions–become the reality.

    Russia’s very capable spokeswoman, Maria Zakharova, understands that Washington uses the Western media to control explanations by shaping public opinion. She terms it a “reality show.” However, Zakharova thinks the problem is that Washington misuses “international relations and international platforms for addressing internal issues.” By this she means that Obama’s foreign policy failures have made him hysterical and impudent as he strives to leave a legacy, and that American/Russian relations are poisoned by the US presidential campaign that is painting Trump as a “Putin stooge” for not seeing the point of conflict with Russia.

    The US presstitutes are disreputable. This morning NPR presented us with a report on Chinese censorship of the media as if this was something that never happens in the US. Yet NPR not only censors the news, but uses disinformation as a weapon in behalf of Washington and Israel’s agendas. Anyone who depends on NPR is presented a very controlled picture of the world. And do not forget German newspaper editor Udo Ulfkotte, who admits he planted stories for the CIA in the Frankfurter Allgemeine Zeitnung and says that there is no significant European journalist who doesn’t do the same thing

    The situation is far more serious than Zakharova realizes. Russians seem unable to get their minds around the fact that the neoconservatives are serious about imposing Washington’s hegemony on the rest of the world. The neoconservative doctrine declares that it is the principal goal of US foreign policy to prevent the rise of any country that would have sufficient power to serve as a check on American unilateralism. This neoconservative doctrine puts Russia and China in Washington’s crosshairs. If the Russian and Chinese governments do not yet understand this, they are not long for this world.

    The neoconservative doctrine fits perfectly with the material interests of the US military/security complex. The US armaments and spy industries have had 70 years to entrench themselves with a huge claim on the US budget. This politically powerful interest group has no intention of letting go of its hold on US resources.

    As long ago as 1961, President Dwight D. Eisenhower in his last public address to the American people warned that the Cold War confronted Americans with a new internal danger as large as the external Soviet threat:

    “Our military organization today bears little relation to that known by any of my predecessors in peacetime, or indeed by the fighting men of World War II or Korea.

     

    “Until the latest of our world conflicts, the United States had no armaments industry. American makers of plowshares could, with time and as required, make swords as well. But now we can no longer risk emergency improvisation of national defense; we have been compelled to create a permanent armaments industry of vast proportions. Added to this, three and a half million men and women are directly engaged in the defense establishment. We annually spend on military security more than the net income of all United States corporations.

     

    “This conjunction of an immense military establishment and a large arms industry is new in the American experience. The total influence — economic, political, even spiritual — is felt in every city, every State house, every office of the Federal government. We recognize the imperative need for this development. Yet we must not fail to comprehend its grave implications. Our toil, resources and livelihood are all involved; so is the very structure of our society.

     

    “In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military industrial complex. The potential for the disastrous rise of misplaced power exists and will persist.

     

    “We must never let the weight of this combination endanger our liberties or democratic processes. We should take nothing for granted. Only an alert and knowledgeable citizenry can compel the proper meshing of the huge industrial and military machinery of defense with our peaceful methods and goals, so that security and liberty may prosper together.”

    President Eisenhower’s warning that our liberties were equally at stake from the military/security complex as from the Soviet Threat did not last 24 hours. The military/security complex buried Eisenhower’s warning with extraordinary hype of the Soviet Threat.

    In truth, there was no Soviet threat. Stalin had buffered Russia from the West with his control of Eastern Europe, just as Washington controlled Western Europe. Stalin had eliminated Trotsky and his supporters who stood for world revolution. Stalin declared “socialism in one country.”

    Stalin terminated international communism. But the American military/security complex had much money to gain from the Amerian taxpayers in order to “protect America from International Communism.” So the fact that there was no effort on the part of the Soviet Union to subvert the world was ignored. Instead, every national liberation movement was declared by the US military/industrial complex to be a “falling domino” of the Communist takeover of the world.

    Ho Chi Minh begged Washington for help against the French colonialists in Vietnam. Washington told him to go to hell. It was Washington that sent Ho Cho Minh to seek communist support.

    The long Vietnam war went on for years. It enriched the military/security complex and officers’ pensions. But it was otherwise entirely pointless. There were no dominoes to fall. Vietnam won the war but is open to American influence and commerce.

    Because of the military/security complex more than 50,000 Americans died in the war and many thousands more suffered physical and psychological wounds. Millions of Vietnamese suffered death, maiming, birth defects and illnesses associated with Washington’s use of Agent Orange.

    The entire war was totally pointless. It achieved nothing but destruction of innocents.

    This is Washington’s preferred way. The corrupt capitalism that rules in America has no interest in life, only in profit. Profit is all that counts. If entire countries are destroyed and left in ruins, all the better for American armaments industries.

    Yes, please, a new Cold War. We need one desperately, a conflict responsibly managed in place of the reckless, insane drive for world hegemony emanating from the crazed, evil criminals in Washington who are driving the world to Armageddon.

  • Sept 11 Widow Is First American To Sue Saudi Arabia For Terrorism: Her Full Lawsuit

    Two days ago, after the stunning Congressional override of Obama’s veto of the Justice Against Sponsors of Terrorism (JASTA), aka the “Sept.11” bill, we wondered how long until the first lawsuit by a Sept 11 victim naming Saudi Arabia as a defendant would emerge.

    We didn’t have long to wait. 

    On Friday, September 30, a woman widowed when her husband was killed at the Pentagon on Sept. 11, 2001 became the first American to sue the Kingdom of Saudi Arabia in Washington DC District Court, just two days after Congress slammed Obama for siding with Saudi Arabia, overriding his presidential veto only for the first time in his administration, and enacting legislation allowing Americans to sue foreign governments for allegedly playing a role in terrorist attacks on U.S. soil.

    Stephanie Ross DeSimone alleged the kingdom provided material support to al-Qaeda and its leader, Osama bin Laden. Her suit is also filed on behalf of the couple’s daughter. DeSimone was two months pregnant when her husband, Navy Commander Patrick Dunn was killed.

    She is suing for wrongful death and intentional infliction of emotional distress, and is seeking unspecified compensatory and punitive damages.

    In the lawsuit she alleges that “at all material times, Saudi Arabia, through its officials, officers, agents and employees, provided material support and resources to Osama bin Laden (“bin Laden”) and Al Qaeda. The support provided by Saudi Arabia to bin Laden and Al Qaeda assisted in or contributed to the preparation and execution of the September 11th attacks and the extrajudicial killing of Patrick Dunn.

    She adds that “Al Qaeda was funded, to the tune of approximately $30 million per year, by diversions of money from Islamic charities” and explains”

    Al Qaeda’s development into a global terrorist network was funded primarily by the money and other material support it received from the Kingdom and purported charities acting as agents and alter-egos of the government of the Kingdom of Saudi Arabia, many of which worked with the Al Qaeda leadership during the Afghan jihad. These governmental agents served as the primary conduits for channeling financial, logistical, operational, and ideological support for Al Qaeda’s global jihad for more than twenty years.

    Fifteen of the 19 men who hijacked airliners used in the attack were Saudi nationals. One jet struck the Pentagon, seat of the U.S. military, two destroyed the World Trade Center’s twin towers in New York while another crashed in a Pennsylvania field as its passengers fought back against the hijackers.

    While a U.S. commission that investigated the 2001 attacks said in a 2004 report that it “found no evidence that the Saudi government, as an institution, or senior officials within the Saudi government funded al-Qaeda”, this will be the first time that a US court will be forced to rule if Saudi Arabia was indeed responsible.  The kingdom has previously denied culpability. Its embassy didn’t immediately reply to an e-mailed message seeking comment on the suit.

    An official at Saudi Arabia’s Ministry of Foreign Affairs told the state-run Saudi Press Agency on Sept. 29 that the U.S. Congress must correct the 9/11 bill to avoid “serious unintended consequences,” adding the law is of “great concern” to the Kingdom.

    Well, thanks to this lawsuit, Saudi Arabia will now be able to provide its opinion in court. Here is what it will have to deny, courtesy of DeSimone’s lawsuit:

    Beyond the massive financial sponsorship of Al Qaeda’s global jihad, the Saudi government, through its agents, officials and purported charities, has been intimately involved in all aspects of Al Qaeda’s operations including:

    • (1) raising and laundering funds on behalf of Islamic terrorist organizations and associated separatist movements, including Al Qaeda;
    • (2) channeling funds to Islamic terrorist organizations, fighters and associated separatist movements, including Al Qaeda;
    • (3) providing financial and logistical support and physical assets to Islamic fighters and terrorists, including Al Qaeda;
    • (4) aiding and abetting Al Qaeda’s terrorist activities, including the planning, coordination, funding and execution of terrorist attacks;
    • (5) permitting Islamic fighters and terrorists, including Al Qaeda members, to use ostensible employment with their organizations as a vehicle for gaining access to conflict regions, thereby allowing those individuals to carry out militant and terrorist activities in those areas;
    • (6) serving as liaisons to localized terrorist organizations on behalf of Al Qaeda, thereby assisting Al Qaeda in expanding its operational base and sphere of influence;
    • (7) funding and facilitating shipments of arms and supplies to Islamic terrorist organizations and associated separatist movements, including Al Qaeda;
    • (8) funding camps used by Al Qaeda and associated jihadist organizations to train soldiers and terrorists, including camps used to train the September 11th hijackers;
    • (9) actively recruiting new members for Islamic terrorist organizations and associated separatist movements, including Al Qaeda;
    • (10) working throughout the World to spread Al Qaeda’s jihadist ideology and draw new adherents to its cause;
    • (11) serving as channels for distributing information and documentation within Islamic terrorist organizations and associated separatist movements, including Al Qaeda, and from Islamic terrorist organizations and separatist movements to the media;
    • (12) disseminating publications designed to advance Al Qaeda’s radical Islamist ideology throughout the Muslim world and legitimize violent jihad against Christians and Jews on the grounds that they are “infidels” who do not deserve to live; and
    • (13) openly advocating for Muslims to take up arms against Western and democratic societies, including the United States.

    The full 54-page lawsuit laying out the plaintiff’s entire case is presented below. And now that the first lawsuit has been filed, we expect a deluge of similar lawsuits. It remains unclear if, now that it is about to be dragged into countless US courts, Saudi Arabia will execute on its threat from 6 months ago and proceed to sell billions in Treasuries and other US assets.

    Saudi Lawsuit

  • 90 Days Later: Still No Signs Of Brexit 'Doom & Gloom'

    For the first half of the year, we were warned early and often by authorities that the Brexit vote could be a calamity for the ages.

    For example, the IMF claimed that a “Leave” result would threaten to “cause severe damage”, while Standard and Poor’s said that it would “paralyze” investment in the UK.

    But, as Visual Capitalist's Jeff Desjardins notes, it turns out that the real Brexit casualty isn’t the UK economy – instead it is the reputation of the many professional economists who wrongly predicted doom and gloom as the likely aftermath.

    THE STORY SO FAR

    Today’s chart looks at the three months before and after the Brexit vote, which took place on June 23, 2016.

     

    Courtesy of: Visual Capitalist

     

    The two charts tracked are the GBP/EUR and the FTSE 100. The former is the price of the British pound in terms of euros, and the latter is a major stock index that includes the largest companies listed in London, such as Barclays, Glencore, HSBC, Royal Dutch Shell, or Sainsbury’s.

    As expected, both markets have seen some action in the aftermath of the vote to leave. The pound has depreciated in terms of euros, but it is still higher now than it was from 2009-2011 in the post-crisis period. Against the ultra-strong USD, the pound is at decade-lows – but many other currencies are in similar territory as well.

    The FTSE 100 is another story. It’s relatively close to all-time highs – and even despite the fears of a potential collapse of Deutsche Bank, it’s climbed over 12% since the initial Brexit slump.

    In both cases, the action was partly underscored by the Bank of England, which announced a new stimulus program (QE) after its August meeting, while cutting rates from 0.5% to 0.25%.

    OTHER INDICATORS

    While there’s been movement in the currency and equity markets, other economic indicators have been status quo or better for the UK so far.

    Retail sales beat in July and August, and unemployment remains at 11-year lows. Purchasing manager indices dropped temporarily, but jumped back up.

    The economists that predicted that the sky was falling? They’ve been forced to revise growth expectations back up, at least on a short-term basis. It’s been dubbed the “Brexit Bounce” by The Spectator, a conservative magazine based in London.

    While there is likely still going to be some long-term fallout from the Brexit decision, many “experts” blew it on this one.

  • Meet The Young Virginia Democrat That Registered 19 Dead People To Vote In Virginia

    Just yesterday we wrote about an FBI investigation into potential voter fraud in the critical swing state of Virginia after it was revealed that 19 dead people had recently been re-registered to vote (see “FBI Investigating More Dead People Voting In The Key Swing State Of Virginia“).  While the Washington Post caught wind of the investigation, it was not known who was behind the operation…until now.  

    Meet, Andrew Spieles, a student at James Madison University, and apparently “Lead Organizer” for HarrisonburgVOTES.  According to the Daily News-Record, Spieles confessed to re-registering 19 deceased Virginians to vote in the 2016 election cycle

    While this should come as a surprise to precisely 0 people, Spieles just happens to be Democrat who, accorded to a deleted FaceBook post, apparently recently ran for Caucus Chair of the Virginia Young Democrats. 

    It’s too bad really, sounds like Spieles had all the right “special talents” required to be very successful politician…he just forgot the most important first rule: “Don’t get caught.”  

    Harrisonburg Votes

     

    The 19 applications of deceased citizens were submitted by Spieles through an organization called HarrisonburgVOTES. According to the organization’s “About Us” page, HarrisonburgVOTES is a “non-partisan” voter registration organization in Harrisonburg, VA and the surrounding areas.

    As the HarrisonburgVOTES webpage points out, the sole goal of the organization is to raise the number of registered voters in Harrisonburg to 25,000…though it’s unclear what percentage of that goal was intended to be filled by dead voters.

    The sole goal of HarrisonburgVOTES is to increase the number of registered voters in Harrisonburg and the surrounding areas to increase and encourage civic engagement.

     

    Harrisonburg has the lowest percentage of voting age population (VAP) registered to vote among Virginia localities. Very roughly, about 17,000 people are registered to vote and about 18,000 are voting age and not registered.  The goal of HarrisonburgVOTES will be to overcome these issues and raise the number of registered voters to 25,000.

    HarrisonburgVOTES was founded by Joseph Fitzgerald who, “shockingly”, is also a prominent democrat in Harrisonburg.   Fitzgerald is currently Chairman of the Sixth Congressional District Democratic Committee in Virginia and the former Mayor of Harrisonburg. 

    Harrisonburg Votes

     

    Fitzgerald told reporters, of course, that his organization had no knowledge of Spieles’s actions and fired him immediately after his confession.   

    “He’s smart, and he understands the [political] process,” Fitzgerald told the Daily News-Record of Spieles. “Who the hell knows what his motivations were?”

    While we agree it’s difficult to be 100% sure about anyone’s motivations, we would be willing to put money on it having something to do with registering a bunch of dead people and then having them all vote for Hillary in November….just a hunch.

  • Voting For Survival: The Election Story Of 2016

    Submitted by TJ Brown via The Foundation for Economic Education,

    Is it just me, or does this year appear to be the most pessimistic election season ever? Typically during presidential elections, you notice people’s optimism as they extol their preferred political candidate. This year, however, not so much.

    Which Poison Is the Least Potent?

    Of course there are plenty within each political party who support their party's nominee. But the mainstream vibe I’ve been getting is mixed. Most people aren’t cheering campaign slogans of Hope & Change. Most people aren’t enthusiastic about the future they’re being promised by their elected representatives.

    There is a sense of betrayal held by supporters of the Bernie Revolution, which promised to oppose corporate corruption in politics, only to endorse the person who is possibly the most cronyistic political candidate Washington has to offer.

    The rebranding of social media hashtags such as #ImWithHer to #IGuessImWithHer exemplifies dispirited submission, rather than positive momentum. Ask a Hillary voter why they’re supporting Hillary, and chances are it’s not because of her policies or her personality. It’s because they are disgusted by and terrified of the opposing candidate, Donald Trump.

    It is the same with Trump’s base. Many are supporting him solely because they feel threatened by a Hillary Clinton presidency. They fear her quasi-socialist economic plans, her hawkish history on foreign policy, and her disregard of the second amendment.

    And even third party candidates feel the same. I’ve often said that much of Gary Johnson’s momentum is not due to his charisma or ideas, but more because many people have equal disdain for both Trump and Hillary, who in many ways are ideologically interchangeable.

    The voice of the American people is so disenfranchised that people are no longer voting based on the desires they want their government to satisfy. Rather, they’re voting based on the least negative inevitable effect the new administration will have on their life.

    There is an upside to this. Even a cause for hope.

    How Did We Get to This Point?

    As with any monster, as government grows, it becomes more threatening and uncontrollable. The democratic process, once used to proactively control the state’s power, has now transformed into a tool of defensive opposition to the threat that same state now poses to our liberty and happiness.

    Some people will claim that this reckless condition of government overreach is due to greedy interests, bad leaders, and bad laws. But the truth is, this beast we find ourselves fighting is of our own creation. It is government created by the people, of the people, but not for the people.

    The pessimism of voters today needs to become optimism about what can be done once the force of rule relinquishes its control.

    Public policy has become exploitation by self-interested citizens looking to control their fellow man via regulatory rule over individuals, markets, academia, and property. This, coupled with the intrinsic power of the state to place itself above the moral standards we hold ourselves to, is why this system exists. It’s not a broken system. It’s an abused system that has been dominated by authoritarian mendicants.

    The ruling class in government has dominated for so long that it has become exclusively pursuant of interests that contribute to its own benefit rather than the benefit of citizens.

    Whether this system will be salvageable remains to be seen, but one thing is abundantly clear: people are fearful of the future actions of their government. And so long as we continue to let it be dominated by power-hungry voters, no matter how altruistic or well-intentioned, the result we are currently woeful of will continue to manifest itself to an even more severe degree than Hillary vs Trump.

    That might at first appear a scary direction in which to travel. And yet there is hope. What is really dawning here is a new embrace of reality. Government has not worked to achieve what it promised to do. The pessimism of voters today needs to become optimism about what can be done once the force of rule relinquishes its control. We need a new confidence in what society can accomplish on its own.

    If the first step is a total loss of faith in political leaders, so be it, so long as it is accompanied by a renewed faith in the power of individuals and society to achieve greatness without being led by would-be central planners.

  • Russia Warns US Military "Aggression" In Syria Would Lead To "Terrible, Tectonic" Consequences

    As the drums of war beat louder, following last week’s ultimatum by John Kerry that the US is contemplating a direct military intervention in Syria, including potentially sending US troops on the ground in the war-torn country for the first time, on Saturday Russia warned the US against carrying out any attacks on Syrian government forces, saying it would have repercussions across the Middle East. The warning comes as government forces captured a hill on the edge of the northern city of Aleppo under the cover of airstrikes.

    It has been one year since Russia became officially involved in the Syria conflict. The maps below show zones controlled by different forces before Russian intervention in September 2015 and the situation now.

    The most obvious change is the collapse in territory controlled by ISIS, as well as the expansion of territories held by the Syrian regime, which is the biggest concern to the US, whose main directive in the Syrian conflict has been less to crush the Islamic State as to minimize the influence and territory of Assad’s regime, replacing it with US-controlled “rebel” forces.

    And with Russia – long an ally to Assad as the conflict is fundamentally about Gazprom’s loss of influence over Europe should a Qatari natgas pipelines cross under Syria  – having become the biggest hurdle to US strategy in Syria, there has been a notable shift in the US strategy, with western media slamming Russia’s “barbarous airstrikes“, focusing on recent bombing strikes of the rebel-held city of Aleppo, a repeat of US strategy from the summer of 2013 when a doctored “chemical attack” YouTube video was used to justify US presence in the local conflict.

    In response, Russian news agencies quoted Foreign Ministry spokeswoman Maria Zakharova as saying that “U.S. aggression” against the Syrian army “will lead to terrible, tectonic consequences not only on the territory of this country but also in the region on the whole.

    She said regime change in Syria would create a vacuum that would be “quickly filled” by “terrorists of all stripes.”

    As AP notes, U.S.-Russian tensions over Syria have escalated since the breakdown of a cease-fire last month, with each side blaming the other for its failure. Syrian government forces backed by Russian warplanes have launched a major onslaught on rebel-held parts of the northern city of Aleppo. Syrian troops pushed ahead in their offensive in Aleppo on Saturday capturing the strategic Um al-Shuqeef hill near the Palestinian refugee camp of Handarat that government forces captured from rebels earlier this week, according to state TV. The hill is on the northern edge of the Aleppo, Syria’s largest city and former commercial center.

    The al Qaeda-linked Ahrar al-Sham militant group said rebels regained control Saturday of several positions they lost in Aleppo in the Bustan al-Basha neighborhood. State media said 13 people were wounded when rebels shelled the central government-held neighborhood of Midan.

    Adding to the propaganda, airstrikes on Aleppo struck a hospital in the eastern rebel-held neighborhood of Sakhour putting it out of service, according to the Britain-based Syrian Observatory for Human Rights, the same entity that created the infamous doctored 2013 YouTube video. 

    Opposition activist Ahmad Alkhatib described the hospital, known as M10, as one of the largest in Aleppo. He posted photographs on his Twitter account showing the damage including beds covered with dust, a hole in its roof and debris covering the street outside. A doctor at the hospital told the Aleppo Media Center, an activist collective, that thousands of people were treated in the compound in the past adding that two people were killed in Saturday’s airstrikes and several were wounded.

    “A real catastrophe will hit medical institutions in Aleppo if the direct shelling continues to target hospitals and clinics,” said the doctor whose name was not given. He said the whole hospital is out of service.

    In a familiar repeat of the 2013 media narrative, opposition activists have blamed the President Bashar Assad’s forces and Russia for airstrikes that hit Civil Defense units and clinics in the city where eastern rebel-held neighborhoods are besieged by government forces and pro-government militiamen.

    On Friday, the international medical humanitarian organization Doctors Without Borders demanded that the Syrian government and its allies “halt the indiscriminate bombing that has killed and wounded hundreds of civilians_many of them children,” over the past week in Aleppo. “Bombs are raining from Syria-led coalition planes and the whole of east Aleppo has become a giant kill box,” said Xisco Villalonga, director of operations for the group. “The Syrian government must stop the indiscriminate bombing, and Russia as an indispensable political and military ally of Syria has the responsibility to exert the pressure to stop this.”

    It said from Sept. 21 to 26, hospitals still functioning in Aleppo reported receiving more than 822 wounded, including at least 221 children, and more than 278 dead bodies_including 96 children_according to the Directorate of Health in east Aleppo.  Sweden’s Foreign Minister Margot Wallstrom criticized attacks on civilian targets writing on her Twitter account: “Unacceptable to bomb civilians, children and hospitals in #Aleppo. No humanity. Assad & Russia moving further away from peace.”

    Surprisingly, few if any in the western media have complained about the thousands of civilians killed by the US-backed Saudi bombing campaign in neighboring Yemen.

    * * *

    Meanwhile, according to leaked closed-door comments by US Secretary of State John Kerry it was revealed how angry John Kerry is about being unable to topple President Bashar Assad by military means.

    The New York Times previously acquired a taped conversation between the US
    Secretary of State and two dozen Syrian civilians from education,
    rescue, and medical groups working in rebel-held areas, during a meeting
    on the sidelines of the United Nations General Assembly. “I’ve argued for use of force. I stood up. I’m the guy who stood up and announced we’re going to attack Assad because of the weapons, and then you know things evolved into a different process,” the Secretary of State said in the tape.

    He told the civilians that “you have nobody more frustrated than we are (the US)” that the Syrian issue is now being solved diplomatically. Kerry also warned the Syrians, who sounded clearly unhappy with Washington’s contribution, that attempts to intervene militarily or provide more support to the rebels by the US may have a reverse effect.

    “The problem is that, you know, you get, quote, ‘enforcers’ in there and then everybody ups the ante, right? Russia puts in more, Iran puts in more; Hezbollah is there more and Nusra is more; and Saudi Arabia and Turkey put all their surrogate money in, and you all are destroyed,” the diplomat explained.

    * * *

    We expect the Syrian proxy war to continue to escalate until either Assad is removed, which however seems unlikely with Russian, and now Chinese backing, behind the Syrian president, or until the proxy war escalates into a full blown world war once US troops are sent to Syria, a move which would be met by a proportional response by Russia and, perhaps, China.

  • German Mayor Beaten Unconscious After Announcing Plan To Accept Refugees

    Over the past several months, the German people have become increasingly frustrated with Merkel’s “open-border” policy that has allowed over 1mm migrants to flow into the country from the Middle East and North Africa.  The flood of migrants has brought with it a wave of violent crime including sexual assaults resulting in a rising nationalist tension as people have turned their backs on Merkel and her Christian Democratic Union party in recent elections.  

    The most recent example of backlash over the migrant crisis comes from the small German town of Oersdorf in Northern Germany.  The Mayor of Oersdorf, Joachim Kebschull (61), was recently beaten unconscious outside of the city’s Town Hall where the construction committee was meeting to discuss a new housing development for migrants.  The mayor was apparently struck with a club from behind as he stepped out the Town Hall building to get a laptop from his car. 

    German Mayo

     

    According to The Telegraph, just hours before the committee meeting Kebschull received a threatening letter saying:

    “He who will not listen will have to feel.” 

     

    “Oersdorf for Oersdorfers”

    According to DW, Kebschull had been receiving threats for months.  In fact, the committee meeting had already been postponed twice over bomb threats. 

    The controversy surrounded a local subsidized housing revitalization where the mayor wanted to offer apartments to asylum-seekers.  “If we could also offer a family of refugees a new home in our village, we would like to take this opportunity and make a small contribution to people who had to flee their homes,” the association said in a statement on its website.

    Kebschull is still in the hospital but is expected to make a full recovery.

     

    The attack occurred in the small North German city of Oersdorf just north of Hamburg.  Oersdorf has less than 900 residents.

    Hamburg

     

    “We cancan’t do this?”

  • Minnesota Commissioner Slams Obamacare As "Unfair & Unsustainable" As Rates Soar

    Soaring Obamacare premiums and declining insurer participation rates in exchanges across the country have been a frequent topic of conversation for us (see “Obamacare On “Verge Of Collapse” As Premiums Set To Soar Again In 2017” and “Stunning Maps Depict Collapse Of Obamacare “Coverage” In 2017“).  So it should come as no surprise to our readers that Minnesota has just announced that 2017 Obamacare rates have been set and are expected to soar nearly 60% on average. 

    Minnesota Commerce Commissioner Mike Rothman posted a letter to the state’s website saying that the state succeeded in preserving the exchanges for one more year by agreeing to massive rate hikes but warned they are on the “verge of collapse.”  The letter goes on to describe Minnesota’s healthcare rate environment as “unsustainable and unfair” and notes that “middle-class Minnesotans” are being “crushed by the heavy burden of these costs.”

    ”Last year at this time when rates were announced, I said there was a serious need for reform in Minnesota’s individual market,” said Rothman. “This year the need for reform is now without any doubt even more serious and urgent.”

     

    He highlighted Governor Mark Dayton’s recent decision to reconvene his Task Force on Health Care Financing to make recommendations to ensure that Minnesota consumers have access to affordable, high-quality health insurance options in the individual market.

     

    “While federal tax credits will help make monthly premiums more affordable for many Minnesotans, these rising insurance rates are both unsustainable and unfair,” said Rothman. “Middle-class Minnesotans in particular are being crushed by the heavy burden of these costs. There is a clear and urgent need for reform to protect Minnesota consumers who purchase their own health insurance.”

     

    Rothman said the reconvened Task Force on Health Care Financing should consider any and all feasible reforms. Above all, he said, it should offer recommendations that can be implemented in the next year to improve market stability and rates for 2018.

     

    “We received over 50 public comments from Minnesotans as part of our rate review,” said Rothman. “I personally read each one. They told heartbreaking stories about how hard-working families are struggling with very tough, painful choices because of these skyrocketing costs. They say that health insurance is unaffordable, and they’re right. This calls for immediate reforms as everyone’s top priority.”

    Rate increases ranges from 50% – 67% across Minnesota.

    Obmacare

    But rates aren’t the only issue.  Most of the insurers participating in Minnesota’s individual market also plan to limit enrollment, to avoid taking on too many customers from other insurers that have pulled out of the exchanges all together. 

    However, Minnesota’s individual market also faces unique challenges because of a disproportionate concentration of individuals with serious medical conditions whose high claims costs must be absorbed by a relatively small risk pool, pushing up rates for everyone in the individual market.

     

    Citing ongoing financial losses, Blue Cross and Blue Shield of Minnesota announced in late June that it is leaving the individual market, except for its Blue Plus HMO affiliate. The company’s decision affects approximately 103,000 Minnesotans, or about 40 percent of the state’s total individual market.

     

    Rothman said that, following Blue Cross’s announcement, Minnesota’s individual market for 2017 was on the verge of collapse as all of the other insurers indicated that they were also prepared to exit this market.

     

    “The Commerce Department pursued every option within its power to avert a collapse this year,” said Rothman. “We succeeded in saving the market for 2017, with only Blue Cross leaving. But the rates insurers are charging will increase significantly to address their expected costs and the loss of federal reinsurance support. In addition, each insurer except for Blue Plus will limit its total 2017 enrollment to manage its financial or provider network capacity to absorb the many current Blue Cross consumers who will be shopping for new plans.”

     

    Obamacare

     

    Meanwhile, per Bloomberg, Jonathan Gold, a spokesman for the U.S. Department of Health and Human Services, peddled the same ole fiction that “headline rate changes do not reflect what these consumers actually pay because tax credits reduce the cost of coverage below the sticker price”…which is true for everyone except the overwhelming majority of people that don’t receive subsidies.

    Guess we have to add Minnesota’s Insurance Commissioner to Obama’s every growing list of “fiction peddlers.”

     

  • Today's Federal Reserve Makes Volcker Look Timid

    Submitted by John Mauldin via MauldinEconomics.com,

    Let’s look at the Fed’s (and other central banks’) magnitude of monetary manipulation in recent years and the very constrained maneuvering room they now have as a consequence.

    Of course, it’s questionable whether they should even be trying to maneuver the economy to the degree that they are. The current problem is a direct result of mistakes made during and after the last financial crisis.

    Two Charts: Bernanke Was More Extreme Than Volcker

    Here’s a long-term chart of the federal funds rate, the Fed’s main policy tool:

    The gray vertical bars represent recessions. You can see how the Fed has historically dropped rates in response to recessions and then tightened again when those recessions ended. I red-circled the drastic loosening and retightening under Paul Volcker in the early 1980s and Ben Bernanke’s cuts to near-zero in 2008.

    To this day, the Volcker rate hikes are legendary. No Fed chair has ever done anything like that—before or since. You hear it all the time.

    Problem: it’s not true.

    Here’s the same chart again. This time with a log scale on the vertical axis. This adjusts the rate changes to be proportionate with percentage rises and falls. The percentage change between 5% and 10% is the same as between 10% and 20%, since both represent a doubling of the lower number.

     

    Looking at it this way, the Volcker hikes are tame.

    But the Bernanke cuts dwarf all other interest rate changes since 1955. Nothing else is even close.

    Bernanke’s rate cuts were far, far more aggressive than Volcker’s rate hikes.

    Why did Bernanke—et al.—cut rates to zero? Because moving rates up and down was all they knew to do.

    The Fed Is Scared of Wall Street

    Moving rates had always worked before. If it wasn’t working this time, the Bernanke-led Fed figured more of the same should do the trick. And it might have worked for a year or two. After that, though, the Fed was so scared of a negative stock market reaction that they kept rates artificially low for eight years.

    Long-term low rates have decimated fixed-income returns of pension funds and retirement plans for the middle class.

    Central banks all over the world did the same—and more. The suffering caused by this bone-headed policy has intensified for all these years. You may not be suffering yourself, but I bet someone close to you is. And I guarantee you that your retirement funds have suffered.

    Now, the supposedly humming economy is going to suffer another recession in the not-too-distant future. What then?

    The Fed Is Ready to Go Negative

    For lack of anything else, the Fed is preparing to send interest rates below zero. That was clearly the message from Jackson Hole.

    How in Hades did we get to a place where negative rates were considered a good idea? One of the most stupid ideas ever cooked up in academia is now seen as rational and globally applicable.

    What should we do? There are not many options. There is no magic wand to get us to normal. If there were, I’m pretty sure the Federal Reserve would wave it at once, because I think everybody realizes that rates should already have been normalized—and that to do so now is going to be problematic.

    We really have come to a place where there are no good choices.

    *  *  *

    Follow Mauldin as he uncovers the truth behind, and beyond, the financial headlines in his free publication, Thoughts from the Frontline. The publication explores developments overlooked by mainstream news and analyzes challenges and opportunities on the horizon.

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Today’s News 1st October 2016

  • Meet The Young Virginia Democrat That Registered 19 Dead People To Vote In Virginia

    Just yesterday we wrote about an FBI investigation into potential voter fraud in the critical swing state of Virginia after it was revealed that 19 dead people had recently been re-registered to vote (see “FBI Investigating More Dead People Voting In The Key Swing State Of Virginia“).  While the Washington Post caught wind of the investigation, it was not known who was behind the operation…until now.  

    Meet, Andrew Spieles, a student at James Madison University, and apparently “Lead Organizer” for HarrisonburgVOTES.  According to the Daily News-Record, Spieles confessed to re-registering 19 deceased Virginians to vote in the 2016 election cycle

    While this should come as a surprise to precisely 0 people, Spieles just happens to be Democrat who, accorded to a deleted FaceBook post, apparently recently ran for Caucus Chair of the Virginia Young Democrats. 

    It’s too bad really, sounds like Spieles had all the right “special talents” required to be very successful politician…he just forgot the most important first rule: “Don’t get caught.”  

    Harrisonburg Votes

     

    The 19 applications of deceased citizens were submitted by Spieles through an organization called HarrisonburgVOTES. According to the organization’s “About Us” page, HarrisonburgVOTES is a “non-partisan” voter registration organization in Harrisonburg, VA and the surrounding areas.

    As the HarrisonburgVOTES webpage points out, the sole goal of the organization is to raise the number of registered voters in Harrisonburg to 25,000…though it’s unclear what percentage of that goal was intended to be filled by dead voters.

    The sole goal of HarrisonburgVOTES is to increase the number of registered voters in Harrisonburg and the surrounding areas to increase and encourage civic engagement.

     

    Harrisonburg has the lowest percentage of voting age population (VAP) registered to vote among Virginia localities. Very roughly, about 17,000 people are registered to vote and about 18,000 are voting age and not registered.  The goal of HarrisonburgVOTES will be to overcome these issues and raise the number of registered voters to 25,000.

    HarrisonburgVOTES was founded by Joseph Fitzgerald who, “shockingly”, is also a prominent democrat in Harrisonburg.   Fitzgerald is currently Chairman of the Sixth Congressional District Democratic Committee in Virginia and the former Mayor of Harrisonburg. 

    Harrisonburg Votes

     

    Fitzgerald told reporters, of course, that his organization had no knowledge of Spieles’s actions and fired him immediately after his confession.   

    “He’s smart, and he understands the [political] process,” Fitzgerald told the Daily News-Record of Spieles. “Who the hell knows what his motivations were?”

    While we agree it’s difficult to be 100% sure about anyone’s motivations, we would be willing to put money on it having something to do with registering a bunch of dead people and then having them all vote for Hillary in November….just a hunch.

  • After the Debate, the Deluge? (Now With A Trigger Warning)

    Submitted by David Galland via GarretGalland.com,

    Trigger Warning: The following article includes an abundance of insults and harsh words directed at individuals of both of the male and female sex as well as politically incorrect statements including digs at cross-dressers and people worried about the weather. If you feel “triggered” by any of the statements, please see a psychiatrist.

    ****  ****  *****

    Dear Debate-Watchers,

    “I guess he is a buffoon after all. Too bad.”

    Those words were written by a dear friend and, until the lights went out on the first presidential debate, the most ardent of Trump supporters.

    For the debate, a group of us had gathered at the Social Club at La Estancia de Cafayate here in the Argentine outback.

    Most of our group were expats who, yearning to be free, have voted with our feet. Therefore, not indicative of broader US demographics.

    It’s safe to say the audience was hopeful that Trump would wipe the proverbial floor with Mrs. Clinton. Within a few minutes, however, it became apparent it was not The Donald holding the mop handle.

    If proof was ever needed that Hillary is a skilled politician, the debate provided it. She speaks in complete sentences, adroitly dodges sticky questions, and wields the rhetorical knife like a Colombian sicario.

    Of course, Hillary had help. It often seemed as if the moderator had sat in on Hillary’s debate preparation, studiously taking notes as her team made helpful suggestions on questions he could use to blindside Trump or topics to be quickly passed over should they arise. Topics such as war-starting and email-server emptying.

    But the moderator’s lack of impartiality ultimately didn’t matter, because, to the great detriment of the American Dream, The Donald could hardly string together a single coherent thought. Trump huffed and puffed—and oddly, sniffed—but in the end couldn’t have blown out a paper match.

    When he did make an understandable point, as often as not, I disagreed. For instance, it seems like he’s advocating imposing a fresh round of trade tariffs, something that history has proven time and again to be a bucket of cold water over the free flow of goods and services. And he appears to favor using US military muscle to “take the oil” of Middle Eastern countries.

    So, here we are.

    And by “here,” I mean on the verge of electing the ultimate statist and an unindicted conspirator in too many shady deals to list here.

     

    The Real Problem

    As mentioned last week, this month’s edition of Compelling Investments Quantified, released yesterday, leads off with a fairly deep dive into the regulatory morass gunking up the workings of the US and global economies.

    To give you the smallest sense of the situation, the graphic below shows the stunning increase in regulation under Obama.

    As you can see, the biggest new burden foisted on the economy is an aggressive ramping up of the Environmental Protection Agency, Grand Inquisitors of the Holy Church of Weather Worriers.

    While I have long held the attitude that anyone wanting to be a politician is possessed of serious character flaws, I confess to caring about Trump winning the debate and, more to the point, prevailing in the November election.

    My reasons were not that he is a man of stellar character with a firm grasp on the issues, but rather because it is clear from his many public actions that he is not a politician in the conventional sense.

    Therefore, the Pollyannaish side of me hoped that, upon taking office, he would stop providing water and nutrients to the growing bureaucracy that is literally destroying the US economy, as well as the very idea of America.

    And by the latter, I mean a corner of the Earth where private property rights are respected and where everyone has a decent shot at attaining whatever it is they deem to be success.

    You know, the America where rugged individuals are considered archetypical.

    Instead, the American entrepreneur is forced to struggle through a minefield of politically correct landmines and hundreds of thousands of pages of laws and regulations.

    Should he or she succeed financially, the government celebrates such success with progressively punitive taxes.

    As a symbol of the New American, I would nominate campus Safe Spaces, such as the one promoted on the sign shown here, from the hallway at Hofstra University where the presidential debate was held.

    I will now briefly pause, dear readers, to let out a string of loud and very politically incorrect expletives.

    That out of the way, and falling in line with what it means to be an American in this day and age, I must confess to feeling “triggered” by the implications of Trump’s debate pratfall.

    After the Debate, the Deluge?

    During the debate, Mrs. Clinton made it clear that—rather than reversing the tide of regulation and taxation, prerequisites to getting the US economy off the blocks—she is going to double down.

    Starting by ensuring that those individuals whose energetic pursuit of success has resulted in them earning above-average incomes are forced by the state to “pay their fair share.”

    We all know how unfair that statement is, given that the top 1% of income earners already pay about half of all income taxes, while the bottom 80% pay just 20% of the total. And a very large percentage of that total pay no taxes at all.

    Mrs. Clinton is aware of these facts, but fairness and facts have no role to play in Progressive America. The only thing that counts is how the narrative plays with the rubes.

    Will she be worse than Obama in terms of regulations and implementing punitive taxes? Based on her history and stump speeches, the Magic 8 ball points to “YES.”

    The following quote is from a Clinton-fawning article in the Huffington Post, entitled, “The Future of America Is Being Written in This Tiny Office.”

    “…Clinton’s plans are as unambiguously progressive as any from a Democratic nominee in modern history—and almost nobody seems to have noticed.”

    Among those plans are free college for the 50% or so of Americans who are already not paying any taxes; subsidies so no one has to pay more than 10% of their income on child care; guaranteed paid family leave; new layers of special treatment for non-whites and non-heterosexuals; new regulations to help unions regain their bargaining power and even, in her own words, to “rewrite the rules” on capitalism.

    And so, at the very point in time when the US desperately needs to cut away the bureaucratic Kudzu holding back capitalism, the country is falling into the hands of a socialist sociopath who views the state as a hammer to be unhesitantly used to beat society flat.

    In addition to higher taxes for those on the wrong side of the income divide, and more handouts for those on the right side, I think we can correctly anticipate some other consequences of Zer election as La Presidenta, many of which will have implications for investment markets:

    • Bank bashing. Mrs. Clinton has promised, when elected, to burden the banks with even more regulations. Coming on top of the massive Dodd-Frank bill, the flow of bank funds, which in a healthy economy provides upwards of 90% of total money supply (M4), will continue to remain frozen.
    • Dastardly deeds done to dirty energy. Oil, gas, nuclear, and in particular coal—are going to come under even greater pressure. Fracking is going to get fracked.
    • Obamacare is dead, long live Hillarycare. Make no mistake, Hillary and her brain trust will set about “fixing” Obamacare by adding yet more bureaucracy. Universal healthcare was her pet project back in the day. She is plenty peeved Obama pulled off his version of it and so will go to great lengths to make it her own again.
    • Political correctness on steroids. The morning after she is sworn in, Hillary will get to work pandering to the miscellany of special interest groups to win a second term. With George Soros on her arm and supported at every turn by the not-so-invisible hand of Silicon Valley, she’ll find ways to assure Black Lives Matter in every way they think they should matter. Ditto, the Hispanic populations and every other non-white male demographic, especially Bernie’s Millennials, who will be a far bigger factor in the next election than they are in this one.
    • An economic circus, but not of the funny sort. The US economy—and most of the world’s largest economies—have suffered extensively at the hands of government bureaucrats who, through ignorance or deliberate malfeasance, have burdened it with regulations to the point of breaking.

      However, given that Clinton will have grand plans to make her tenure historically significant for something more than possessing a womb, you can expect a tidal wave of new regulation designed to create a more perfect world.

      As the new wave of regulations will threaten to kill the already gagging golden goose, the Clinton administration will need to get very creative to keep the deficits from running amok.

      I can’t even begin to guess how, but literally anything that can be imagined is on the table. Wage and price controls, higher estate taxes, big penalties for companies with assets overseas (unless, of course, her hubby is on the board), confiscating foreign-held assets… really, anything is fair game.

    • Prosperity on hold. Most importantly, instead of turning back toward the light, a Clinton victory ensures that the current economic stagnation and the attendant societal tensions will only worsen. Rig for a long dark night and for the deluge that is all but certain.

    While the blame for the precarious situation the US finds itself in could justly be placed at the feet of any number of players, and extends well back in history, at the risk of angering some dear readers, in terms of the here and now, I choose to throw a razzberry in the direction of Donald Trump.

    That’s because he arrogantly failed to properly prepare for the debate. As a consequence, he walked into one sucker punch after another and, when smacked, had no snappy retorts prepared to steer the debate back to themes less flattering to his opponent.

    By failing to prepare, he let down the millions of people who had allowed themselves to become reengaged in the political process and who dared hope the cultural Marxism overrunning the nation could be slowed.

    Of course, there is another possible explanation for Trump’s performance. Maybe he did prepare rigorously for the debate—and according to his campaign co-chair, he did—in which case, could his dismal performance be a sign that, per my friend’s assessment, he actually is a buffoon? Or, as they say in Texas, he’s all hat and no cows.

    Regardless, his dismal showing has fully exposed the tender belly of what was left of the American dream, granting a big opening for the progressives to move in for the kill.

    Game Over?

    Given the debate disaster, is it game over for Trump and, by extension, America?

    It’s impossible to say. On the one hand, demoralized as Trump’s supporters may be, the idea of President Hillary is probably enough to get them off their couches come election day.

    In fact, much to my surprise, following the debate, Trump’s fundraising efforts soared. And while I have heard from many Trump supporters who share my assessment of his debate performance, every one of them appears to remain committed to their candidate come election day.

    However, as far as independents go, I think his performance may have poisoned that well for good.

    At the end of the day, it will all come down to turnout. Whereas prior to the debate, Hillary couldn’t get any respect, I don’t think anyone who watched could deny that she appeared more presidential.

    Condescending? Arrogant? Slippery? Absolutely.

    But at least she was coherent.

    I cannot tell you how it pains me to write these words, because I tend toward optimism in my life. Despite having removed our family from ground zero, I had hoped the driving force behind Trump’s near miraculous candidacy—an up-swelling of popular anger at the poor condition the bureaucrats have left the country in—heralded a step back toward the path of sanity for the United States.

    Maybe Trump just had a really bad day and will do well enough in what’s left of the campaign season to prevail. And maybe, if elected, he’ll surround himself with smart people and then wander off to the nearest golf course like his predecessor.

    At this point, given the choice between the anti-capitalist crook and the big unknown that is Donald Trump, I would still have to pull the lever for Trump and hope for the best.

    However, after the dismal debate, the future has just gotten a lot more unpredictable.

  • In Hacked Fundraiser Recording, Hillary Mocks Bernie Supporters "Living In Their Parents’ Basement"

    The reason why the Trump campaign has been so eager to find transcripts and recordings of the private speeches Hillary Clinton has delivered during her extensive, lucrative speaking career, is because it is there that she reveals that rare glimpse into what she truly thinks, or at least what $250,000 per hour will get her to believe. One such example is a recently hacked recording of Hillary Clinton, where in a private conversation with campaign donors in February, Clinton distanced herself from progressive goals like “free college, free healthcare” and described her place on the political spectrum as spanning from the center-left to the center-right.

    The newly disclosed comments first noticed by the Intercept, came in audio from hacked emails revealed this week by the Washington Free Beacon. Clinton was speaking at a Virginia fundraiser hosted by Beatrice Welters, the former U.S. ambassador to Trinidad and Tobago, and her husband Anthony Welters, the executive chairman of an investment consulting firm founded by former Clinton aid Cheryl Mills.

    The hacked audio provides another peek into the ideological chameleon that Hillary is on a day to day basis. As the Intercept notes, “Clinton has been inconsistent in the past about espousing political labels. She has at times touted herself as stalwart liberal. For instance, she said last July: “I take a backseat to no one when you look at my record in standing up and fighting for progressive values.” But a few months later, she told a group in Ohio: “You know, I get accused of being kind of moderate and center. I plead guilty.”

    In one segment of the leaked audio, Hillary focused on her opponent at the time, Bernie Sanders, was pointed to successful programs in Scandinavia which provide universal daycare, family leave, and government sponsored healthcare and college education, as policies that he would seek to adopt. “Progressive” Hillary mocked the compared idea of “free college, free healthcare” to the “extreme” ideas promulgated by the right, which include “populism, nationalism and xenophobia.”

    It is important to recognize what’s going on in this election. Everybody who’s ever been in an election that I’m aware of is quite bewildered because there is a strain of, on the one hand, the kind of populist, nationalist, xenophobic, discriminatory kind of approach that we hear too much of from the Republican candidates. And on the other side, there’s just a deep desire to believe that we can have free college, free healthcare, that what we’ve done hasn’t gone far enough, and that we just need to, you know,  go as far as, you know, Scandinavia, whatever that means, and half the people don’t know what that means, but it’s something that they deeply feel. So as a friend of mine said the other day, I am occupying from the center-left to the center-right. And I don’t have much company there. Because it is difficult when you’re running to be president, and you understand how hard the job is —  I don’t want to overpromise. I don’t want to tell people things that I know we cannot do.

    Recording below::

     

    Clinton then went on to explain why she felt so many Democratic voters, many of whom “live in their parents’ basement” were gravitating to Sanders. Ironically, for a presidential candidate that touts the economic recovery the US is going through, she admits these “children of the Great Recession” don’t see much of a future…

    Some are new to politics completely. They’re children of the Great Recession. And they are living in their parents’ basement. They feel they got their education and the jobs that are available to them are not at all what they envisioned for themselves. And they don’t see much of a future.

    … and with an entire generation unexpectedly finding itself in a dead-end economy, it provides a perfect incubator for what according to Hillary is an army of Bernie supporters: “if you’re feeling like you’re consigned to, you know, being a barista… then the idea that maybe, just maybe, you could be part of a political revolution is pretty appealing.”

    I met with a group of young black millennials today and you know one of the young women said, “You know, none of us feel that we have the job that we should have gotten out of college. And we don’t believe the job market is going to give us much of a chance.” So that is a mindset that is really affecting their politics. And so if you’re feeling like you’re consigned to, you know, being a barista, or you know, some other job that doesn’t pay a lot, and doesn’t have some other ladder of opportunity attached to it, then the idea that maybe, just maybe, you could be part of a political revolution is pretty appealing

    One wonders whose fault it is that millions of young people are stuck in dead end jobs, living in their parents basement, while both Obama and Hillary make TV appearances touting the strength of the economic recovery.

    But the punchline was what Hillary, who has been scrambling to secure the much-needed Millennial vote in recent weeks, truly thought about about the millions of young people whose vote she is trying to win: a diatribe of mockery, in which she describes the concept of a political revolution as a “false promise” which has attracted all these disillusioned and disheartened young people “living in their parents’ basement.” Does Hillary have anything to offer them? No, but she desperately needs their vote, even if behind the scenes at generously paid private functions, she mocks them in front of all those present.

    We should all be really understanding of that and should try to do the best we can not to be, you know, a wet blanket on idealism. We want people to be idealistic. We want them to set big goals… But those of us who understand this, who’ve worked in it know that it’s a false promise. But I don’t think you tell idealistic people, particularly young people that they’ve bought into a false promise.

    Especially when you are trying to secure their votes?

    Then again, considering the eagerness with which Bernie Sanders has endorsed Wall Street’s favorite candidate, it is quite clear that the real “false promise” here was Sanders’ “revolution” all along.  We wonder if in light of this hack, if Bernie Sanders would care to make some statement why he is endosing the candidate who behind closed doors, openly mocks everything that his supporters believe in.

    Clinton has been accused numerous times in the past of patronizing young Sanders supporters. On Meet The Press in April, Clinton said she said “I feel sorry sometimes for the young people” who believe Sanders’s claims about her taking money from the fossil fuel industry.

    During her remarks, she reiterated her belief that politics is the art of the possible, dismissing the more aspirational approach of Sanders and his supporters. “I want to be very clear about the progress I think we can make,” she said. There was no discussion of her view that the ideology of millions of progressive, young people is a false promise.

    And while America’s young voters will be given an opportunity to respond to Hillary in just over 5 weeks time, one wonders what, in a world where Donald Trump’s every word is brutally attacked by the pro-Clinton media. would emerge if even a handful of Hillary’s Wall Street speech transcripts were the finally emerge.

  • A Furious Rick Santelli Rages At Janet's Jawboning: "Please, Don't Help Anymore"

    CNBC’s Rick Santelli turned it up to ’11’ today as The Fed’s Janet Yellen joined the world’s central planners in suggesting intervention directly in the stock markets would ‘help’ the average joe.

    Santelli exclaims “don’t help anymore!!” How has any of their ‘help’ helped in the last 7 years?

     

    “Central banks buying in the [stock] market… you really think that’s a good idea?” Raging about picking winners, buying Deutsche Bank, and keeping stocks “steady” around elections, the veteran pit trader exploded, “is that the world we really want to live in?”

     

    The Fed’s buying stocks “will completely and utterly and in every possible way destroy and value in the marketplace…”

    3 minutes of brutal reality slapped into the face of a ridiculous rumor-driven day…

  • "Message Sent?" – Russia, China Release Stunning Panoramic Video Of Naval Drills

    Helicopters and warships dominated the South China Sea, as Russia and China continued their joint eight-day naval exercises, dubbed Joint Sea 2016.

    A total of 18 ships and supply vessels, 21 aircraft and over 250 service personnel took part in the Joint Sea 2016 naval drills on September 12-19 in the South China Sea.

    Does this look like Russia and China are sending a message?

    h/t The Burning Platform

  • The Complete A To Z Of Nations Destroyed By Hillary Clinton's "Hubris"

    Submitted by Wayne Madsen via infowars.com

    In an email sent to his business partner and Democratic fundraiser Jeffrey Leeds, former Secretary of State Colin Powell wrote of Hillary Clinton, “Everything HRC touches she kind of screws up with hubris.”

    Clinton’s tenure as Secretary of State during Barack Obama’s first term was an unmitigated disaster for many nations around the world. Neither the Donald Trump campaign nor the corporate media have adequately described how a number of countries around the world suffered horribly from Mrs. Clinton’s foreign policy decisions.

    Millions of people were adversely harmed by Clinton’s misguided policies and her “pay-to-play” operations involving favors in return for donations to the Clinton Foundation and Clinton Global Initiative.

    The following is a before and after recap, country by country, of the destabilizing effects of Clinton’s policies as Secretary of State:

    Abkhazia

    Before Hillary: In 2009, more and more nations began recognizing the independence of this nation that broke away from Georgia and successfully repelled a U.S.-supported Georgian invasion in 2008.

    After Hillary: Clinton pressured Vanuatu and Tuvalu to break off diplomatic relations with Abkhazia in 2011. The State Department pressured the governments of India, Germany, and Spain to refuse to recognize the validity of Abkhazian passports and, in violation of the US-UN Treaty, refused to permit Abkhazian diplomats to visit UN headquarters in New York. The Clinton State Department also threatened San Marino, Belarus, Ecuador, Bolivia, Cuba, Somalia, Uzbekistan, and Peru with recriminations if they recognized Abkhazia. Georgia was connected to Clinton through the representation of Georgia in Washington by the Podesta Group, headed by Tony Podesta, the brother of Mrs. Clinton’s close friend and current campaign chairman John Podesta.

    Argentina

    Before Hillary: Under President Nestor Kirchner and his wife Cristina Fernandez de Kirchner, Argentina’s economy improved and the working class and students prospered.

    After Hillary: After former president Nestor Kirchner’s sudden death in 2010, the U.S. embassy in Buenos Aires became a nexus for anti-Kirchner activities, including the fomenting of political and labor protests against the government. Meanwhile, Clinton pressed Argentina hard on its debt obligations to the IMF, also crippling the economy.

    Bolivia

    Before Hillary: Bolivia’s progressive president Evo Morales, the country’s first indigenous Aymara leader, provided government support to the country’s coca farmers and miners. Morales also committed his government to environmental protection. He kept his country out of the Free Trade Area of the Americas and helped start the Peoples’ Trade Agreement with Venezuela and Cuba.

    After Hillary: Clinton permitted the U.S. embassy in La Paz to stir up separatist revolts in four mostly European-descent Bolivian provinces, as well as foment labor strikes among miners and other workers in the same model used in Venezuela.

    Brazil

    Before Hillary: Brazil’s progressive presidents, Luiz Inacio Lula da Silva and Dilma Rousseff, ushered in a new era for the country, with workers’ and students' rights at the forefront and environmental protection and economic development for the poor major priorities.

    After Hillary: Clinton’s authorization of massive electronic spying from the US embassy in Brasilia and consulate general in Rio de Janeiro resulted in a “constitutional coup” against Rousseff and the Workers’ Party government, ushering in a right-wing, CIA-supported corrupt government.

    Central African Republic

    Before Hillary: Under President Francois Bozize, the CAR remained relatively calm under a peace agreement hammered out under the auspices of Muammar Qaddafi’s Libya.

    After Hillary: In 2012, Islamist terrorists of the Seleka movement and supported by Saudi Arabia conducted an uprising, massacring Christians and riving Bozize’s government from power. The CAR became a failed state under Clinton’s State Department.

    Ecuador

    Before Hillary: Ecuador began sharing its oil wealth with the people and the economy and the plight of the nation’s poor improved.

    After Hillary: Clinton authorized a 2010 National Police coup against President Rafael Correa. The economy soon plunged as labor disputes wracked the mining and oil sectors.

    Egypt

    Before Hillary: Under Hosni Mubarak, Egypt was a stable secular nation that suppressed jihadist politics in the mosques. The jihadist-oriented Muslim Brotherhood was kept at bay.

    After Hillary: After Clinton’s 2011 “Arab Spring” and the toppling of Mubarak, Egypt saw Mohamed Morsi of the Muslim Brotherhood elected president. Immediately, the secular country began a process of Islamization with Christian Copts experiencing repression and violence, including massacres. Morsi’s rule resulted in a military coup, thus ending Egypt’s previous moves toward democracy.

    Germany

    Before Hillary: The nation was a peaceful country where German culture, as well as religious freedom and women’s rights were guaranteed.

    After Hillary: Clinton’s “Arab Spring” eventually resulted in a flood of mainly Muslim refugees being welcomed into Germany from the Middle East, Africa, and South Asia. Today, Germany is wracked by Muslim refugee street crime, unsanitary and harmful public health habits of migrants, sexual assaults by migrant men of women and children, increased acts of terrorism, and a diminution of German culture and religious practices.

    Greece

    Before Hillary: Greece was a nation that saw government safety net social services extended to all in need. It also remained a top tourist destination for northern Europeans.

    After Hillary: The 2010 debt crisis emaciated the Greek economy and Clinton remained adamant that Greece comply with draconian economic measures dictated by Germany, the European Union, and the IMF/World Bank. Making matters worse, Clinton’s “Arab Spring” eventually resulted in a flood of mainly Muslim refugees being welcomed into first, the Greek isles, and then mainland Greece, from the Middle East, Africa, and South Asia. Today, Greece, especially the islands of Lesbos, Chios, Samos, Symi, Rhodes, Leros, and Kos, are wracked by Muslim refugee crime, unsanitary public health habits of migrants, sexual assaults by migrant men of women and children, acts of arson and vandalism, and a diminution of Greek culture and religious practices.

    Guatemala

    Before Hillary: Under President Alvaro Colom, the nation’s first populist progressive president, the poor received access to health, education, and social security.

    After Hillary: Clinton authorized the U.S. embassy in Guatemala to work against the 2011 election of president Colom’s wife, Sandra Torres. Colom was succeeded by a right-wing corrupt president who resigned for corruption and then was arrested.

    Haiti

    Before Hillary: Haiti was prepared in 2011 to re-elect Jean-Bertrand Aristide, forced out of office and into exile in a 2004 CIA coup. The prospects of Artistide’s return to power was a blessing for the slum dwellers of Haiti.

    After Hillary: Clinton refused to allow Aristide to return to Haiti from exile in South Africa until it was too late for him to run in the 2011 election. Under a series of U.S.-installed presidents, all approved by Bill and Hillary Clinton, Haiti is a virtual cash cow for the Clintons. The Clinton Foundation diverted for its own use, international aid to Haiti, and the Clintons ensured that their wealthy friends in the hotel, textile, and construction businesses landed lucrative contracts for Haitian projects, none of which have benefited the Haitian poor and many of which resulted in sweat shops and extremely low wage labor practices.

    Honduras

    Before Hillary: Emergent multi-party democracy with a populist progressive president, Manuel Zelaya. Children received free education, poor children received free school meals, interest rates were reduced, and the poorest families were given free electricity.

    After Hillary: Clinton authorized a military coup d’etat against Zelaya in 2009. Clinton family “fix-it” man Lanny Davis became a public relations flack for the military dictatorship. A fascist dictatorship involved in extrajudicial death squad killings of journalists, politicians, and indigenous leaders followed the “constitutional coup” against Zelaya. During 2012, Clinton ordered U.S. embassy in Tegucigalpa to work against the 2013 election of Xiomara Castro de Zelaya as president.

    Iraq

    Before Hillary: Under Prime Minister Nouri al-Maliki, Iraq experienced small moves toward an accommodation with the Kurds of the north and Sunnis. Iran acted as a moderating political force in the country that deterred any attempts by Saudi-supported jihadis to disrupt the central government in Baghdad.

    After Hillary: Clinton’s Arab Spring resulted in the rise of the Sunni/Wahhabist Islamic State in northern and western Iraq and Iraq’s plunge into failed state status. Shi’as, Kurds, Yazidis, Assyrian Christians, and moderate Sunnis were massacred by the jihadis in northern, western, and central Iraq. The Iraqi cities of Mosul, Kirkuk, and Nineveh fell to ISIL forces with non-Muslims being raped, tortured, and executed and priceless antiquities being destroyed by the marauding jihadists.

    Kosovo

    Before Hillary: Kosovo, which became independent in 2008, initially granted its Serbian minority in northern Kosovo and Metohija some degree of self-government.

    After Hillary: In 2009, Kosovo increasingly became a state ruled by criminal syndicates and terrorists of the former Kosovo Liberation Army. The rights of Serbs were increasingly marginalized and Kosovo became a prime recruiting ground for jihadist guerrillas in Arab countries subjected to Clinton’s “Arab Spring” operations, including Libya and Syria.

    Clinton pressured states receiving U.S. aid and other U.S. allies to recognize Kosovo’s independence. These included Pakistan, Palau, Maldives, St. Kitts-Nevis, Dominica, Fiji, Papua New Guinea, Burundi, East Timor, Haiti, Chad, Gambia, Brunei, Ghana, Kuwait, Ivory Coast, Gabon, St. Lucia, Benin, Niger, Guinea, Central African Republic, Andorra, Oman, Guinea-Bissau, Qatar, Tuvalu, Kiribati, Honduras, Somalia, Djibouti, Vanuatu, Swaziland, Mauritania, Malawi, New Zealand, Dominican Republic, Jordan, Bahrain, and Comoros. In the Kosovo capital of Pristina, there is a 10-foot-high statue of Bill Clinton standing over Bill Clinton Boulevard. Not far away is a women’s clothing store called “Hillary.”

    Libya

    Before Hillary: Under Muammar Qaddafi, post-sanction Libya saw a boom in urban construction and a new major international airport to serve as a hub for Africa. Plans announced for an African dinar, supported by Libyan gold holdings, to serve the needs of Africa. All Libyans received free education and medical care. There was a program for revenue sharing of Libya’s oil wealth with the Libyan people.

    After Hillary: Clinton’s 2011 regime change operations against Qaddafi, which saw the Libyan leader sodomized, beaten, and shot in the head by U.S.-supervised jihadist rebels, resulted in Clinton laughing about the incident in the infamous, “We came, we saw, he died” comment. Libya became a failed state where Islamic jihadist terrorists vied for control of the country and Qaddafi’s arm caches were given or sold to jihadist terrorists in Syria, Iraq, Egypt, the pan-Sahel region, and sub-Saharan Africa. After Qaddafi’s ouster, black African guest workers and their families were massacred by jihadist forces.

    Malaysia

    Before Hillary:  Malaysia, before 2009, was a religiously tolerant nation where Buddhists, Christians, and Hindus enjoyed freedom of religion.

    After Hillary: In 2009, Najib Razak became prime minister and he began accepting bribes from Saudi Arabia that totaled some $2.6 billion with additional Malaysian public money in Razak’s personal bank accounts plus the Saudi cash totaling some $3.5 billion. Razak began allowing Saudi-influenced clerics to push for sharia law throughout Malaysia and Christians in Sarawak, Sabah, and Penang began experiencing Wahhabist repression. Clinton was silent about Malaysian persecution of non-Muslims. The reason may have been a reported several hundred million donation from Razak’s slush fund into the Clinton Foundation’s coffers.

    Palestine

    Before Hillary: In 2012, Palestine was granted non-member observer status in the United nations. The 2009 Goldstone Report of the UN found that Israel violated international humanitarian law in its war against Gaza in 2009. Palestine was gaining more support and sympathy internationally and was successfully putting to rest Israeli propaganda disinformation.

    After Hillary: Hillary Clinton rejected the Goldstone Report as “one-sided.” Clinton’s unbridled support for expanding Israeli settlements in the West Bank and east Jerusalem and its silence on the dehumanizing Israeli blockade of Gaza, emboldened Israel’s theocratic right-wing government to further encroach on Palestinian territories and cementing into place an apartheid-like series of Palestinian “Bantustans” in the West Bank and an open-air ghetto in Gaza.

    Paraguay

    Before Hillary: The country under Fernando Lugo began lifting out of poverty the nation’s rural campesinos and urban workers. Paraguay also began a steady move toward democratization after years of military dictatorships.

    After Hillary: Clinton’s 2012 “constitutional coup” against Fernando Lugo brought back into power the military-industrial oligarchy with the nation’s campesinos being forced back into poverty and repressive rule.

    South Sudan

    Before Hillary: Prior to independence in 2011, South Sudan, while rife with intra-tribal feuding, was relatively calm.

    After Hillary: After being rushed into independence from Sudan in 2011, South Sudan, a special project of Clinton, George Soros, and actor George Clooney, descended into civil war and chaos. It beat all records in being transformed from a newly-independent state into a failed state.

    Syria

    Before Hillary: Syria was a multi-cultural and multi-religious secular state championing the concept of pan-Arab socialism and progressive policies advanced by Egypt’s Gamal Abdel Nasser. Syria was not a safe place for jihadism.

    After Hillary: After Clinton’s 2011 green light for the “Arab Spring,” Syria became a failed state where the Islamic State gained a firm foothold. Minority Alawites, Christians, Druze, and Kurds were massacred by jihadist groups aided and abetted by NGOs and other interests backed by Clinton.

    Thailand

    Before Hillary: Thailand’s Red Shirt movement was a powerful force that demanded a return to democracy in Thailand and the restoration of former Prime Minister Thaksin Shinawatra, ousted in a 2006 military coup, to power.

    After Hillary: A Red Shirt protest in 2010 resulted in a bloody crackdown by the Thai military. Clinton remained silent about the Thai army’s killing of protesters and the mass arrests of Red Shirt leaders. U.S. military assistance to the Thai government was continued by Clinton. When Thaskin’s sister, Yingluck Shinawatra, became prime minister in 2011, Clinton began working to undermine her and her government in a manner not unlike Clinton’s subterfuge against Rousseff in Brazil and Cristina Kirchner in Argentina. When it comes to women leaders, Clinton only tolerates conservatives who kow-tow to the United States. The pressure against Yingluck eventually resulted in her ouster in 2014 and her being criminally charged in the same manner that saw Rousseff charged in Brazil.

    Tunisia

    Before Hillary: Tunisia was one of the most secular nations in the Arab and Islamic world. A top destination for European tourists, the country was more European in its outlook than North African.

    After Hillary: After Clinton’s 2011 “Jasmine Revolution,” a textbook themed revolution crafted by Clinton’s friend George Soros, Tunisia descended into Islamist rule and violence. Today, Tunisia is the top country for recruits to the Islamic State.

    Turkey

    Before Hillary: Turkey was moving steadily closer to European standards on human rights and democracy. Even under the Islamist-oriented Prime Minister Recep Tayyip Erdogan, the country remained committed to pluralism.

    After Hillary: Clinton authorized the shipment of Libyan weapons captured from Qaddafi’s arms caches to Turkish middlemen in the employment of Erdogan’s government for transfer to the jihadist rebels in Syria. A complication in this arrangement resulted in the September 11, 2012 jihadist attack on the CIA warehouse facility in Benghazi, which killed U.S. envoy Chris Stevens and other State Department personnel. Turkey’s dalliance with jihadist rebels in Syria was mirrored by increasing Islamization of Turkey. The events of 2011 and 2012 resulted in Turkey today being ruled by an Islamist strongman, Erdogan, with open political opposition being stamped out.

    Ukraine

    Before Hillary: Ukraine was a stable and neutral country that neither aligned itself with the West and NATO nor with Russia under the presidency of Viktor Yanukovych, elected in 2009 and inaugurated in 2010.

    After Hillary: Clinton tried everything possible to ensure the 2009 defeat of Viktor Yanukovych. The State Department and its friends in the George Soros camp provided assistance to Clinton’s favorite candidate Yulia Tymoshenko to defeat Yanokovych. It was this early interference in the 2009 election that ultimately led to the “Euromaidan” themed revolution in 2014 against the government, resulting in civil war, the retrocession of Crimea back to Russia, and secessionist states in eastern Ukraine. Clinton’s policies directly led to a failed state in Europe.

    Venezuela

    Before Hillary: Under Hugo Chavez, the country provided basic social services to its poorest of citizens. Venezuela also provided discounted gasoline to several Caribbean and Central American countries through the PetroCaribe consortium.

    After Hillary: After Clinton allowed the U.S. embassy in Caracas to foment anti-Chavez labor and political protests, the country began to falter economically. After Chavez’s 2012 diagnosis of terminal cancer, the State Department stepped up pressure on Venezuela, crippling the nation’s economy and political system.

    Western Sahara

    Before Hillary: Recognized by the African Union and several nations around the world as the Sahrawi Arab Democratic Republic (SADR), Western Sahara saw some hope for an evacuation of illegal Moroccan occupation troops from its territory.

    After Hillary: In 2010, Moroccan troops began entering Sahrawi refugee camps and attacking residents, even in UN-protected exclusion zones, where Moroccan troops were prohibited from entering. Clinton ensured that UN talks and a proposed popular referendum on the future of Western Sahara were stalled. Clinton pressured a number of states to withdraw their recognition of the SADR, including St. Vincent and the Grenadines, Paraguay, Haiti, Guinea-Bissau, Cape Verde, Malawi, Kenya, Mauritius, Zambia, Panama, and Burundi. The Clinton Foundation received a 2011 donation of $1 million from a Moroccan phosphate company owned by the Moroccan government and which has mining operations in Western Sahara.

    Yemen

    Before Hillary: Yemen was a largely secular state that was transforming into a federation where the rights of South Yemen and the Zaidi Houthis of north Yemen were being recognized.

    After Hillary: Clinton’s “Arab Spring” of 2011 and the fall of Abdullah Saleh from power saw Yemen become a failed state. Al Qaeda in the Arabian Peninsula and the Islamic State gained control over several areas of North and South Yemen. The fall of Saleh permitted Saudi Arabia to conduct a genocidal war in the country with Mrs. Clinton’s full support.

     

  • China Housing Bubble Re-Inflates – "Even We Didn't Expect The Prices To Go Up This Much"

    They say that history tends to repeat itself and for the China housing market, and its constantly repeating cycle of bubbles, that certainly seems to be the case.  It seems like just yesterday that we pointed out the following video of ghost towns springing up all over China with millions of square feet of newly constructed residential living space but not a single resident. 

     

    And now, as we’ve pointed out numerous times recently (see posts here and here), China’s home prices are bubbling up all over again.  Prices in China’s smaller cities, in particular, are seeing the largest gains as buyers from the larger tier one cities go hunting for “bargains.”  In fact, per a recent account from Reuters, home prices in the city of Changsha have risen 30% in two months all while 13.5mm square meters of residential real estate remains unoccupied.

    “Prices have risen 2,000 yuan ($299.84) per square meter on average in the past two months. That’s almost a 30 percent rise from July,” said Hu Yi, marketing manager at Central Courtyard, a residential project in Changsha targeting mid- to high-end buyers.

     

    Chen Xiaochuan, marketing manager with local residential property project Xiang-Shore Park said speculators make up about a third of homebuyers in Changsha.

     

    They are mainly from first-tier cities such as Shanghai and Shenzhen, property agents said, but are also from Hefei, where home prices have doubled since the start of the year.

     

    China Index Academy data shows there are 126,945 homes, or 13.46 million square meters, sitting empty in Changsha.

     

    China Real Estate Bubble

     

    But Changsha isn’t the only city where home prices are bubbling over.  Prices in the Zhengdong district have risen two-thirds this year with sales managers in the area caught off guard, “Even we didn’t expect the prices to go up this much.”

    “We have already bought an apartment here, and we are looking to buy a second one,” a woman who goes by her last name Wang told Reuters just outside of project’s sales office.

     

    “We see a flux of buyers from people outside of Zhengzhou, especially those from smaller cities in the same province,” Xu said, who apologized for his raspy voice, which he said was due to one too many sales pitches.

     

    And for Zhang Liyang, a sales manager at Greenland Group’s HK.600606 Zhengzhou office, the price surge in the past few months came as a surprise, which meant missed opportunities as she was entitled to employee discount rates.

    Of course, as we’ve pointed out numerous times, and confirmed here with data from Deutsche Bank’s China Chief Economist, Zhiwei Zhang, the whole thing is yet another debt-fueled bubble that will inevitably come crashing down again at some point in the not-so-distant future.

    Per the chart below, accompanying China’s booming property market is a surge in mortgage loans with LTV’s skyrocketing to 71.2% in recent months, twice the level in 2016H1, 34.8%, which was already much higher than its peak, around 25%, in previous years.

    China Bubble

     

    Meanwhile, DB points out the average land auction premium for tier 1 cities rose from around 40% at the beginning of the year to over 90% by August.  In tier 2 cities it soared to almost 70% from 25%.  Note, these are premia to asking prices not even YoY price changes…seems very reasonable.

    China Real Estate Bubble

     

    And, of course, pricing growth is almost perfectly correlated with credit expansion.

    China Real Estate Bubble

     

    But, just like last time around, its probably nothing…

  • "The Fed Is Leading Us To Economic Hell" Mauldin Warns "Only A Public Outcry Can Stop It"

    Submitted by John Mauldin via MauldinEconomics.com,

    The Fed argues that low rates have worked. The economy emerged from recession. Unemployment drifted back down. “Yay for us,” said the Fed.

    Don't buy that statistical economic garbage. The economy recovered in spite of Fed policy, not because of it. The economy recovered because business owners, entrepreneurs, and workers rolled up their sleeves and made things happen.

    It involved a lot of pain: layoffs, asset sales, lost customers, and more. But the hard-working citizens of this country slowly and painfully pulled themselves out of the nosedive.

    Those are the people who deserve the credit, not the Fed. Keeping rates at artificially low levels did nothing other than push our economy into the mother of all corners.

    Look where we are now.

    The next recession means rates will go below zero

    The US economy is going to suffer another recession in the not-too-distant future. So, for lack of anything else to do, the Fed is preparing to send rates below zero when the economy next needs goosing. That was clearly the message from Jackson Hole.

    What then? Here is the most likely scenario I think we are facing—and you are not going to like it.

    We are going to go into the next recession with interest rates still stuck in the sub-1% range. This doesn’t give the Fed much ammunition.

    Economists (who could certainly qualify as High Priests) have done studies on recent Fed policies. These show that quantitative easing didn’t really do anything, other than maybe goose the stock market.

    There is also no data that shows any positive benefit from the so-called wealth effect, which was all the academic rage at the beginning of this process. Forget the wealth effect. The fact is that when the stock market goes up, it does not trickle down to the average guy on Main Street.

    (It’s ironic that the same economists who derided supply-side economics as trickle-down economics have adopted trickle-down monetary policy. I mean, that is so messed up on so many levels.)

    We know that the Fed will not simply do nothing. We’ll get quantitative easing on a scale that is currently unimaginable. This will blow out the Fed’s balance sheet to a level that is unrecognizable.

    Unless there’s considerable pushback from Congress. And it must come from more than just the usual suspects on the far right of the Republican Party. If not, we will see negative rates in the world’s reserve currency.

    The central bankers of Europe who are experimenting with negative rates came to Jackson Hole to advise the Fed. They said that negative rates are working wonderfully. Never mind that cash hoarding in Switzerland is at astronomical levels.

    (It’s a fascinating arbitrage: bank rates are -75 bips, and you can insure your cash in a safe deposit box for about 10 bips. And in Switzerland, you can find a bill worth $1000. It makes total sense.)

    Negative rates will drive consumer spending down, not up. They will result in less income in retirees' pockets—forcing them to save more, work longer, and spend less.

    The next 10 years will see an explosion of government debt and an implosion of the ability of governments to fulfill their promises. Any economic or investment model based on past performance under previous economic conditions will be worthless. Just as worthless as the Federal Reserve’s models.

    The toughest investing climate of the last 100 years

    We are truly going to have to go outside the box if we are going to figure out how to get our portfolios from where we are today to the other side of the coming crisis. There is no way to predict what our investment portfolios should look like six months or one year or two years or six years from now.

    I see no way for Europe to avoid that crisis. The US might if we make some radical decisions in 2017. You can ask yourself how likely that is.

    I’m telling you, this is not going to end well. You cannot assume that your investment returns will look anything like the average for the last 20, 30, 40 years.

    I know some people will say that is exactly what’s going to happen. Many of them are my friends, and I enjoy sitting and talking with them over a bottle of wine and a great meal. But I will look them in the eye and tell them that they’re walking into economic hell with their eyes closed. And anyone who follows them will see their portfolio go up in smoke.

    This is going to be the most difficult investing environment of the last 100 years. Only a public outcry can stop it.

    *  *  *

    Follow Mauldin as he uncovers the truth behind, and beyond, the financial headlines in his free publication, Thoughts from the Frontline. The publication explores developments overlooked by mainstream news and analyzes challenges and opportunities on the horizon.

  • Debate Commission Admits There Was An "Issue" With Trump's Microphone

    Almost one week after the first presidential debate, and days after Trump claimed that there were problems with his microphone, earlier today the Commission on Presidential Debates issued a brief, one-sentence statement Friday admitting “issues” with Donald Trump’s audio in during the first presidential debate held on Monday.

    “Regarding the first debate, there were issues regarding Donald Trump’s audio that affected the sound level in the debate hall,” the statement read.

    Was Trump’s audio purposefully impaired? It is unclear, however we do know that while Trump argued after the debate that his microphone was defective, Hillary Clinton dismissed it an excuse of someone who did poorly. Clinton, who put Trump on the defensive, mocked the republican on Tuesday for complaining about his microphone.

    “Anybody who complains about the microphone is not having a good night,” Clinton quipped while speaking to reporters on her plane.

    Trump told reporters immediately following the debate that event organizers “gave me a defective mic” that he said affected the audio inside the Hofstra University venue. 

    In retrospect it means he was right.

    “Did you notice that?” he asked a reporter immediately after the debate. “My mic was defective within the room.” 

    While the issue didn’t appear to affect the broadcast of the debate, it may have led to a loss of concentration at the high stakes event, giving Hillary an advantage.

    “Was that on purpose?” Trump asked. We will likely never know.

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Today’s News 30th September 2016

  • France's New Sharia Police

    Submitted by Yves Manou via The Gatestone Institute,

    • Are French institutions sacrificing one freedom for another? Is equality between men and women being sacrificed to freedom of religion (Islam) to impose its diktats on French society?
    • If someone still does not realize that the Islamic dress code is the Trojan horse of Islamist jihad, he will learn it fast.
    • For years, "big brothers" have been obliging their mothers and sisters to wear a veil when they go out. Now that this job is done, they have begun to fight non-Muslim women who wear shorts and skirts — no longer just in the sensitive Muslim "no-go zones" of the suburbs, where women no longer dare to wear skirts — but now also in the heart of big cities.
    • "The law guarantees women, in all fields, same equal rights as men."
    • What people do not seem to know is that in the heart of Paris, a Muslim man can insult a woman for drinking a cola in the street and is served in stores first, before women.
    • Many people evidently still do not know that Islam is a religion and a political movement at war with the West — and openly intent on subjugating the West. It must be responded to as such. The problem is, every time it is responded to as such, Muslim extremists run for cover under the claim of freedom of religion.
    • It is crucial for Western societies to start making a distinction between freedom of speech and incitement to violence, and to begin seriously penalizing attacks on innocents, as well as calls to attack innocents.

    The Council of State, the highest administrative court in France, decided that, to allow freedom of religion, the burkini must not be banned. At first the ruling looked sound: why should people not be able to wear what they wish when they wish? What is not visible, however, is that the harm comes later.

    If someone still does not realize that the Islamic dress code is the Trojan horse of Islamist jihad, he will learn it fast.

    A few recent incidents include:

    September 7. In Guingamp, Brittany, a 17-year-old girl in shorts was beaten by a man who considered her outfit "too provocative". Although the attacker escaped, so that the police have no idea who he is or what his background might be, it is a taste of things to come.

     

    September 7. In Toulon, southern France, two families were on a bicycle path when they were insulted by a gang of 10 "youths" (the French press uses "jeunes" [youths] in order not to say Arabs or Muslims). According to the local prosecutor, the "youths" shouted at the women, "whores!" and "strip naked!" When the women's husbands protested, the "youths" approached and a fight began. One of the husbands was found unconscious with multiple facial fractures.

     

    At first, the motive of the attack was reported to be linked to the women wearing shorts, but in fact the women were not wearing shorts; they were wearing leggings.

     

    July 19. In a resort in Garde-Colombe (Alps), a Moroccan man stabbed a woman and her three daughters, apparently because they were scantily dressed. One of the girls was seriously injured. The attacker, Mohamed, says that he was the "victim," because he claims the husband of the woman he stabbed scratched his own crotch in front of Mohamed's wife. According to the prosecutor, "the husband of the victim does not remember having made such a gesture."

     

    July 7. A day-camp center in Reims, eastern France, circulated a note asking parents to avoid dressing their daughters in skirts because of the improper conduct of boys aged 10 to 12. A mother published the document on Twitter and commented on Facebook: "Obviously the idea did not occur to them that it is not for little girls to adapt their dress to big creeps, but for big creeps to get educated? "

     

    In early June, 18-year-old Maude Vallet was threatened and spat on by a group of girls on a bus in Toulon because she was wearing shorts. She posted a photo of herself on Facebook with the caption, "Hello, I'm a slut." The posting was shared by more than 80,000 people. The attackers were Muslim girls, but Maude, according the "politically correct" who believe "thntdwi" (this has nothing to do with Islam), did not want to reveal their ethnic origin.

     

    April 22. Nadia, a 16-year-old girl wearing a skirt, was severely beaten in Gennevilliers, a suburb of Paris, by three girls who were apparently Muslims.

    Snapshots of France's new sharia police. Left: In Toulon, 18-year-old Maude Vallet was threatened and spat on by a group of Muslim girls on a bus, because she was wearing shorts. She posted a photo of herself on Facebook with the caption, "Hello, I'm a slut." Right: In a resort in Garde-Colombe, a Moroccan man stabbed a woman and her three daughters on July 19, apparently because they were scantily dressed.

    These cases were dramatically publicized in all media, both official and social. Ironically, however, none of these incidents triggered the international attention and outrage that greeted a Burkini incident in Nice: A woman, apparently Muslim, was lying alone on a beach with no towel, no book, no parasol, no sunglasses, no husband (or brother, or father) to "protect" her, in the full glare of the midday sun near a police post — with a photographer nearby ready and waiting to take pictures of her surrounded by four policemen. Who alerted them? The woman was issued a fine and possibly ordered to remove some of her clothes on the beach. Pictures of the incident were first published on August 23 by the Daily Mail and within minutes went viral, provoking international indignation against these seemingly racist French people discriminating against innocent Arab women. A week later, however, the Daily Mail suggested that this incident may well have been "staged" and the "pictures may be SET UP."

    So the real question is: Are Islamists in France now using photos and videos, the way the Palestinians are doing against Israel: to film and disseminate fake and staged situations in order to provoke global indignation about supposedly poor Muslim "victims" — especially women who are allegedly "discriminated against" in France?

    If fabricated propaganda is allowed to persist, the defrauders will win a big war.

    "In the war that Islamism is leading with determination against civilization, women are becoming a real issue," said Berenice Levet, author and professor of philosophy at the École Polytechnique to the daily Le Figaro.

    She added:

    "Rather than produce figures that say everything and nothing, I want it recognized once and for all that if today the roles of the genders are forced to regress in France, if domination and patriarchy are spreading in our country, this fact is related exclusively to our having imported Muslim values."

    Ironically, at the same moment, France's Minister for Family, Children and Women's Rights, Laurence Rossignol, decided to spend public money on an ad campaign against "ordinary sexism" — the supposed sexism by all French men against supposedly eternally victimized women. But there was not a word in this campaign about the possible victimization or potential outcome from the increasing proliferation of the burqa, veil or burkinis on Muslim women.

    Commenting the ad campaign, Berenice Levet added:

    "Laurence Rossignol should read Géraldine Smith's book, Rue Jean-Pierre Timbaud. Une vie de famille entre barbus et bobos ("Jean-Pierre Timbaud Street: The life of a family among bearded men [Islamists] and Bohemians"). She would learn — among other things — that in some stores or bakeries, men are served first, before women."

    In this book, we can learn also that in the heart of Paris, a Muslim can insult a woman for drinking a cola in the street. But for many, including Rossignol, it seems the only enemy is the white Frenchman.

    Two serious questions are at stake:

    • Are sharia police emerging in France?
    • Are French institutions sacrificing one freedom for another? Is the principle of equality between men and women being sacrificed to freedom of religion (Islam) to impose its diktats on French society?

    Sharia Police

    In France, no organized Islamist brigades patrol the streets (as in Germany or Britain) to fight alcohol consumption or to beat women for the way they are dressed. Yet gangs of "youths", again, both men and women, are increasingly doing just that in practice. For years now, "big brothers" have been obliging their mothers and sisters to wear a veil when they go out. And now that this job is done, they have begun to fight non-Muslim women who wear shorts and skirts — no longer just in the sensitive Muslim enclaves, the "no-go zones" of the suburbs, where women no longer dare to wear skirts — but now also in the heart of big cities.

    More and more, the equivalent of "Islamist Virtue Police" try to impose those standards by violence. As Celine Pina, former regional councilor of Île-de-France, said in Le Figaro:

    "In the last recorded attack [on the families in Toulon], with cries of "whores" and "strip naked", the young men were behaving as a "virtue police" that we had thought impossible here in our parts…

     

    "It cannot be expressed more clearly: it is a command to modesty as a social norm and self-censorship as a behavioral norm… [it]… illustrates the rejection of the female body, seen as inherently impure and dirty…

     

    "The question of the burkini, the proliferation of full veils, assaults against women in shorts and the beating of their companions, share the same logic. Making body of the woman a social and political issue, a marker of the progress of an ideology within society."

    Laurent Bouvet, a professor of political science, noticed on his Facebook page that after the men were beaten in Toulon, so-called human rights organizations — supposedly "professionals" of "anti-racism" — remained silent in the debate.

    The prosecutor of #Toulon said: "the fight was trigger by a women's dress code. These women were not wearing shorts… Sexism is undeniable. Where are the professionals of public indignation?"

    Laurence Rossignol, Minister for Women's Rights, remained silent too. So a new rule has emerged in France: the more politicians and institutions do not want to criticize Islamists norms, the more violent the debate on social networks.

    Equality between Men and Women or Freedom of (Islamic) Religion?

    The silence of politicians and human rights organizations, when non-Muslim women are violently assaulted because they wear shorts that are not compatible with sharia — as opposed to their thundering indignation against police for issuing a fine to a Muslim woman in a burkini — signals an immensely important political and institutional move: A fundamental and constitutional principle, equality between men and women, is being sacrificed in the name of freedom of religion, thereby enabling one religion (Islam) to impose its diktats on the rest of society.

    Studying the burkini case in Nice, Blandine Kriegel, philosopher and former president of Haut Conseil à l'intégration (High Council of Integration) published an analysis in which she establishes that in the burkini case, secularism or individual freedom were not even in danger in the first place. But "fundamentally an openly, the principle of equality between men and women" was surrendered:

    In its remarkable ordinance, the Council of State refers to the jurisprudence of 1909 concerning the wearing of a cassock and does not pay attention to more recent laws voted on by sovereign people, prohibiting the veil at school (2004) and burqa in public places (2010).

     

    The Council of state did not feel inspired either by the constitutional commitment towards women: "the law guarantees women, in all fields, same equal rights as men."

     

    In the burkini affair, neither secularism nor individual freedom is at stake; but fundamentally and openly the principle of equality between men and women. … This term "burkini" integrates intentionally the word "burqa"; this word does not express the desire to go swimming at the beach (nothing prohibits this); or the affirmation of a religious freedom (no mayor has ever prohibited the exercise of the Muslim religion); the word burkini express only the essential inequality of women.

     

    Contrary to their husbands, who feel free to exhibit their nudity, some women must be covered from head to toe. Not only because they are impure, but mostly because of the legal status conferred to them: they are under the private law of the husband, the father or the community.

     

    The Republic cannot accept something opposed to its laws and values. Inequality of women cannot be defended on the ground of religious freedom… of freedom of conscience. This issue was addressed three centuries ago by our European philosophers, who are founding fathers of the Republic. To those who were legitimating oppression, slavery and inequality were merely the expression of free will, explained the French philosopher Jean-Jacques Rousseau, inspiring our 1789 Declaration [of the Rights of Man and of the Citizen], and that freedom and equality are inalienable possessions.

    France's socialist government and administrative judges have apparently found it politically useful to make concessions to Islamists. Perhaps they originally agreed to burkinis not only because they may think that people should wear what they like, but also in the vain hope of calming down the permanent pressure that increasingly appears to be a cultural jihad. It may not even have occurred to them that they were potentially sacrificing the principle of equality of women.

    Many people evidently still do not know that Islam is a religion and a political movement at war with the West — and openly intent on subjugating the West. It must be responded to as such. The problem is, every time it is responded to as such, Muslim extremists run for cover under the claim of freedom of religion.

    It is high time for French and European politicians to draw a hard line between where one person's right to worship as they see fit ends, and where society's right to freedom and security begins. And it is time to outlaw, not necessarily the burkini, but the very real problem of aggressive supremacism.

    The root problem is incitement to violence. It is crucial for Western societies to start making a distinction between freedom of speech and incitement to violence, and to begin seriously penalizing attacks on innocents, as well as calls to attack innocents.

  • This Is How Much Liquidity Deutsche Bank Has At This Moment, And What Happens Next

    It is not solvency, or the lack of capital – a vague, synthetic, and usually quite arbitrary concept, determined by regulators – that kills a bank; it is – as Dick Fuld will tell anyone who bothers to listen – the loss of (access to) liquidity: cold, hard, fungible (something Jon Corzine knew all too well when he commingled and was caught) cash, that pushes a bank into its grave, usually quite rapidly: recall that it took Lehman just a few days for its stock to plunge from the high double digits to zero.

    It is also liquidity, or rather concerns about it, that sent Deutsche Bank stock crashing to new all time lows earlier today: after all, the investing world already knew for nearly two weeks that its capitalization is insufficient. As we reported earlier this week, it was a report by Citigroup, among many other, that found how badly undercapitalized the German lender is, noting that DB’s “leverage ratio, at 3.4%, looks even worse relative to the 4.5% company target by 2018” and calculated that while he only models €2.9bn in litigation charges over 2H16-2017 – far less than the $14 billion settlement figure proposed by the DOJ – and includes a successful disposal of a 70% stake in Postbank at end-2017 for 0.4x book he still only reaches a CET 1 ratio of 11.6% by end-2018, meaning the bank would have a Tier 1 capital €3bn shortfall to the company target of 12.5%, and a leverage ratio of 3.9%, resulting in an €8bn shortfall to the target of 4.5%.

    When Citi’s note exposing DB’s undercapitalization came out, it had precisely zero impact on the price of DB stock. Why? Because as we said above, capitalization – and solvency – tends to be a largely worthless, pro-forma concept. However, when Bloomberg reported today that select funds have withdrawn “some excess cash and positions held at the lender” the stock immediately plunged: the reason is that this had everything to do with not only DB’s suddenly crashing liquidity, but the pernicious feedback loop, where once a source of liquidity leaves, the departure tends to spook other such sources, leading to an outward bound liquidity cascade. Again: just ask Lehman (and AIG) for the details.

    Which then brings us to the $64 trillion (roughly the same amount as DB’s gross notional derivative exposure) question: since DB is suddenly experiencing a sharp “liquidity event”, how much liquidity does Deutsche Bank have access to as of this moment, to offset this event? The answer would allow us to calculate how long DB may have in a worst case scenario if we knew the rate of liquidity outflow.

    For the answer, we go to a just released note by Goldman Sachs, which admits that it is now facing “crisis” questions from clients, among which “can a large European bank face a liquidity event” to wit”

    Deutsche Bank stands at the center of the European financial system – it is a major counterpart of all relevant European banks, and broader. Recent reports of potential litigation hits have compounded capital concerns, and raised the overall level of market anxiety. “Crisis” questions are being asked: “is there risk of a financial crisis re-run” and “can a large European bank face a liquidity event”?

    So what is the answer: how much liquidity does Deutsche Bank have access to? The answer is two fold, with the first part focusing on central bank, in this case ECB, backstops in both $ and €. 

    Goldman starts with an overview of said back-stops, summarized below. These facilities are available to all Eurozone banks (and, naturally, also to Deutsche Bank) – they are generous in terms of volume (full allotment), price (fixed rate at 0%) and tenure (from short term, all the way to 4-years). These ECB facilities are key to ensuring the bank’s long-term funding stability, in Goldman’s view, and were put in place following the funding market fallout in 2007, in order to contain the effects from the Lehman crisis. They were further bolstered to contain the Eurozone sovereign crisis in 2011-12. All of the liquidity provisions remain in place, and broadly, they fall into the following two categories:

    1. Regular market operations: 1-week Main Refinancing Operations or “MRO” (priced @0%), and 3-month Long Term Refinancing Operations or “LTRO” (@0%);
    2. Non-standard measures, which split between € funding facilities with 4-year Targeted LTROs (@0%, with the option to fall to -0.4% if lending targets are met) and the emergency liquidity assistance to solvent financial institutions and a US$ funding facility: 1-week US$ MRO (@0.86%).

    Stepping away from the ECB – because if Deutsche is forced to come crawling to Draghi and beg for central bank liquidity assistance to continue as a going concern, the outcome may be just as dire (recall the stigma associated with US banks using the Fed’s Discount Window) especially since  unlike Lehman, DB has nearly €600 billion in deposits which are susceptible to a retail depositor run – what about Deutsche Bank’s own liquidity position? It is this which appears to be concerning the market most, because as Goldman writes, following the Bloomberg report that hedge fund clients have pulled excess cash, the market has reacted aggressively (ADR down 6.7%), indicating concerns have moved from DBK’s equity to question the resilience of the banks’ funding position.

    Below, Goldman provides an overview of DBK’s liquidity position, noting that its last reported liquidity reserve stood at €223 bn or ~20% of its total assets. DBK’s high quality liquid assets (or HQLA) balance stood at €196 bn or 16% of its total assets; its liquidity coverage ratio (“LCR”) stood at 124%. DBK’s LCR is above that of many largest European banks (BNP 112%), as well as US banks (Citigroup
    121%).

    Here is the breakdown:

    • Liquidity reserve: €223 bn, or ~20% of total assets. In total, DBK’s liquidity reserve stood at €223 bn, representing ~20% of the banks total net assets (where assets are US GAAP equivalent). The 2Q16 level of liquidity reserve compares to €65 bn in 2007, showing that DBK has grown its liquidity reserve by 3.4x from pre-crisis levels.
    • Cash: €125 bn. The liquidity reserve breaks down between €125 bn of cash and cash equivalents, and €98 bn of securities, available for use at the central banks. As highlighted in Exhibit 2, the € portion of the securities can be used to obtain liquidity of varied duration (between O/N to 4-years) at a cost of 0% (and as low as -40 bp, if lending benchmarks are met).
    • LCR: 124%. DBK’s Liquidity Coverage ratio stood at 124%, which is ~1.5x the current regulatory minimum, and a cut above the 2019 fully-loaded requirement of 100%. This compares favorably to, say, Citigroup (121%), BNP (112%). Other US banks (e.g. JPM, BofA) do not disclose their LCR other than to say that they are “compliant”, suggesting LCR is at or above 100%.

    Where does this liquidity come from? Exhibit 3 above examines DBK’s funding composition – this is relevant in the context of media reports highlighting a decline in prime brokerage balances (Bloomberg, September 29). These include:

    • Lowest volatility funding: 57%. Lowest volatility sources of funding – retail deposits, transaction banking balances (corporate and institutional deposits from corporate banking relationships) and equity account for 57% of total funding. Over half of the groups’ funding therefore, stems from this source.
    • Low volatility funds: 15%. Debt securities in issue account for 14% of total funding. Together with the previous category, “lowest” and “low” volatility funding accounts for 72% of total funding.
    • Other customers – this includes prime brokerage cash balance – 7%. The total amount of “other customer” funds, which includes: fiduciary, self-funding structures (e.g. X-markets), margin/Prime Brokerage cash balances (shown on a net basis (see DBK 2015 annual report, p178). Importantly, this represents ~7% of total funding, and is 3.1x covered with the liquidity reserve.
    • Other parts of funding – unsecured wholesale, secured funding – account for the residual.

    In other words, all else equal, even in a worst case Prime Brokerage situation, one where all €71 billion in “other customer” funds flee, DB should still have about €152 billion of the €223 billion in liquidity reserve as of June 30, once again assuming there have been no other changes. Stated simply, if the hedge fund outflow accelerates and depletes all the liquidity at the Prime Brokerage division, DB would part with about a third (just over  €70 billion) of its €220 billion liquidity reserve.

    Some other observations: even if one assumes the full loss of PB balances, DB would still have a Liquidity coverage ratio (“LCR”) of 124%.  The LCR is equivalent to HQLA/net stressed outflows over 30 day period. This ratio shows the banks’ ability to meet stressed funding conditions over a period of 1 month. For Deutsche bank, the LCR stood at 124% with the ratio composed of:

    1. High Quality Liquid Assets (HQLAs) of €196 bn. These include Level 1 assets (the most liquid securities which include cash and equivalents, bonds issued or guaranteed by a government and certain covered bonds); Level 2A assets, which are subject to a haircut (third country government bonds, bonds issued by public entities, EU covered bonds, non-EU covered bonds, corporate bonds) and Level 2B assets (high quality securitisations, corporate bonds, other high quality covered bonds).
    2. The net stressed outflows: €158 bn as of 2Q16 (YE15 €161 bn). DBK’s net stressed outflows amounted to €161 bn at year-end 2015, and include an assumption of loss of prime brokerage deposits. As per Commission Delegated Regulation (EU) 2015/61 “Deposits arising out of a correspondent banking relationship or from the provision of prime brokerage services shall not be treated as an operational deposit and shall receive a 100 % outflow rate.”
    3. The minimum level is 100% (effective 2018) and is phased in gradually from 2015; the 2016 requirement is 70%.

    Of course, the “stressed outflow over a 30 day period” is an assumption, one which can accelerate rapidly, especially if the stock price of DB continues to fall crushing what is any bank’s most critical asset: counterparty confidence, either from retail investors or institutional peers.

    Still, what the above calculations reveals is that the Bloomberg report suggest that while substantial, the Prime Brokerage outflow would not be, on its own, deadly.  But therein lies the rub: since any bank’s collapse is a procyclical event in which liquidity flees in all directions, with a speed that is usually inversely proportional to the stock price, the lower the price of DB goes (and the higher its CDS), the more dire its liquidity situation.

    However, as noted above, the biggest threat to DB is not so much its hedge fund client base, whose damage potential is limited, but the depositor base. Again: while Lehman failed, it did so as a result of its corporate counterparties suffocating the bank by rapidly pulling out their liquidity lines. Lehman, however, was lucky in that it didn’t have retail depositors: it death would have likely come far faster as the capital panic was not limited to institutions but also included a retail depositor bank run.

    This is where Deutsche Bank is very different from Lehman, and far riskier, because if the institutional panic spreads to the depositor base, which as the table below shows amounts to some €566 billion in total, and €307 billion in retail deposits…

     

    … then all bets are off.

    Which is why it is so critical for Angela Merkel to halt the plunging stock price, an indicator DB’s retail clients, simplistically (and not erroneously) now equate with the bank’s viability, and the lower the price drops, the faster they will pull their deposits, the quicker DB’s liquidity hits zero, the faster the self-fulfilling prophecy of Deutsche Bank’s death is confirmed.

    Which ultimately means that DB really has four options: raise capital (sell equity, convert CoCos, which may results in an even bigger drop in the stock price due to dilution or concerns the liquidity raise may not be sufficient), approach the ECB for a liquidity bridge (this may also backfire as counterparties scramble to flee a central bank-backstopped institution), appeal for a state bailout (Merkel has so far said “Nein”) or implement a bail-in, eliminating billions in unsecured claims (and deposits) and leading to a full-blown systemic bank run as depositors everywhere rush to withdraw their savings, leading to a collapse of the fractional reserve banking mode (in which there is only 10 cents in physical deliverable cash for every dollar in depositor claims). 

    Which of the four choices Deutsche Bank will pick should become clear in the coming days. Until it does, it will keep the market on edge and quite volatile, because as Jeff Gundlach explained today, a “do nothing” scenario is no longer an option for CEO John Cryan as the market will keep pushing the price of DB lower until it either fails, or is bailed out.

  • The Run Begins: Deutsche Bank Hedge Fund Clients Withdraw Excess Cash

    Deutsche Bank concerns just went to ’11’ as Bloomberg reports a number of funds that clear derivatives trades with Deutsche Bank AG have withdrawn some excess cash and positions held at the lender, a sign of counterparties’ mounting concerns about doing business with Europe’s largest investment bank.

    While the vast majority of Deutsche Bank’s more than 200 derivatives-clearing clients have made no changes, some funds that use the bank’s prime brokerage service have moved part of their listed derivatives holdings to other firms this week, according to an internal bank document seen by Bloomberg News.

    Millennium Partners, Capula Investment Management and Rokos Capital Management are among about 10 hedge funds that have cut their exposure, said a person familiar with the situation who declined to be identified talking about confidential client matters.

     

    The hedge funds use Deutsche Bank to clear their listed derivatives transactions because they are not members of clearinghouses. Millennium, Capula and Rokos declined to comment when contacted by phone or e-mail.

    Which explains why short-dated CDS is soaring.

     

     

     

    “Our trading clients are amongst the world’s most sophisticated investors,” Michael Golden, a spokesman for Deutsche Bank, said in an e-mailed statement.

     

    “We are confident that the vast majority of them have a full understanding of our stable financial position, the current macroeconomic environment, the litigation process in the U.S. and the progress we are making with our strategy.”

    Clients review their exposure to counterparties to avoid situations like the 2008 collapse of Lehman Brothers Holdings Inc. and MF Global’s 2011 bankruptcy when hedge funds had billions of dollars of assets frozen until the resolution of lengthy legal proceedings.

    As expected, Deutsche Bank stock in NY is sliding.

     

    If the most sophisticated professionals in the world are withdrawing cash, why are German depositors leaving their life savings at risk… ahead of a long weekend in Germany (Monday is a bank holiday).

    *  *  *

    And for those believing that there is no contagion and this is all ring-fenced…

     

    And US banks are sliding…

     

    As a reminder, if the liquidity run forces DB to start unwinding or being forced to novate derivatives, it could get ugly.

     

    Those who have cash parked at Deutsche Bank, and at last check there was about €566 billion, they may want to consider moving it for the time being to a safer bank.

     

    * * *

    Earlier this morning, we reported that Europe is experiencing a sudden and acute dollar shortage, which we attributed to Deutsche Bank. It now appears this was accurate. Since Deutsche’s recent highs, the short-end of the EUR-USD basis swap curve has collapsed:

    Simplifying – this chart measures the degree of USD shortage
    (willingness to spend money just to get USD now) across time – the lower
    the level, the more desperate for USDs.

    And no, it’s not a quarter-end issue:

     

    Still not sure… Then explain why European banks just increased
    their demand for USDs from The ECB’s 7-day lending facility by over
    2000%…

    As @Landonthomasjr notes, since 2009: DB shareholders put up 13.5 billion euros in equity. DB has paid 19.3 billion euro in bonuses. Perhaps they should have saved some of that cash eh?

    Simply put – trust in the European Banking system is faltering, counterparty risk hedging is accelerating:

     And liquidity concerns are exploding, ahead of Germany’s bank holiday on Monday.

  • Pizzaflation and the US Dollar collapse

    Sometimes the best economic analysis comes anecdotally.  Why not explain the most important economic issue of our day with America’s favorite food: PIZZA.  As we explain in our book Splitting Pennies – Understanding Forex, the real reason of inflation is because of monetary policy, not supply and demand.

    In case you didn’t know, facts about Pizza

    Pizza is actually America’s favorite food.  The Atlantic covered a DOA report that showed the cheesy stats:

    Like football, pop music, and democracy itself, pizza follows in the long American tradition of things that began overseas before the United States imported, violently altered, and eventually defined the institution. Although the first pizza shops didn’t open in the U.S. until the early 20th century, hundreds of years after the original Neapolitan pies, we now spend $37 billion a year on pizza, accounting for a third of the global market. The obsession deepens. On any given day, about 13 percent of Americans eat pizza, according to a new report from the Department of Agriculture. One in six guys between the ages of two and 39 ate it for breakfast, lunch, or dinner today. In part due to this obsession, per capita consumption of cheese is up 41 percent since 1995. Drawn from the report, here are seven facts about Americans and pizza, presented free of moralizing comments about whether or not it is healthy or sensible for the American diet to consist so overwhelming of bread adorned with tomato-cheesey gloop.

    Pizza, is actually an AMERICAN food, brought to America by the Italians.  Pizza was invented in Italy, but in Italy, Pizza is completely different, and not very popular.  In fact, Pizza is most popular in America.  It’s more American than Apple Pie.  Check it out:

    In 1905, a slice of pizza cost five cents. During the Depression, when families did not have much money, pizza became popular with everyone in the United States. Families were eating different types of pizza on the east and west coasts. A thick-crust pizza was called double-crust pizza or west coast pizza. When they had a large exhibit about pizza at the Texas State Fair, more people inquired about this food than any other.The first recipe for pizza appeared in a fundraising cookbook published in Boston in 1936. The recipe, for Neapolitan pizza, was made by hand. Dough had to be hand-stretched by pizzaiolos and housewives until it was half an inch thick. The pizza had cheese, tomatoes, grated parmesan cheese, and olive oil. Surprisingly, the dough was not made by hand, but cooks were told to buy it at a good Italian bake shop.However, pizza was mostly limited to Italian immigrant communities until after World War II, when American soldiers returning from Italy still wanted their pies. Popularity spread, and various American styles developed. Pizzeria Uno is credited with the invention of the Chicago deep dish pizza in 1943. This is known as tomato pie and was baked in rectangular pans in bakeries. Its crust was extra thick and it had seasoned tomato puree and was dusted with Romano cheese before it went into the oven. Some eventually had meat and thick cheese, and it was so thick, it often had to be eaten with a knife and fork.

    The American Dollar is collapsing

    From five cents a slice to $20 a Pizza.  What happened?  During this time, the US Dollar went down by more than 95%.  Let’s take a look at one of America’s favorite Pizzas, Numero Uno Pizza.  For those of you who have not had the pleasure to live in the greater Los Angeles area, where Numero Uno has had 95% name recognition, Numero Uno Pizza is a household name.  Interestingly, Numero Uno was founded in Los Angeles right around the time Nixon created Forex; 1970.  We’ve obtained an old Numero Uno menu (we think though, it’s from the 80s) that shows prices from that time:

    Wow!  .85 House Wine, less than $5 for a Carafe!  

    Now take a look at prices we’ve lifted from current NU store sites, such as Numero Uno Palmdale:

    The most popular NU pizza is the S5 “Slaughterhouse 5” which currently stands at $16.95.  We confirmed with the manager of Palmdale location that indeed; prices are due for a rate hike in January.

    From $10.85 to $16.95 isn’t too bad, Pizzaflation is not nearly as bad as inflation in other markets, most notably, real estate, groceries, coffee, and other items.  Using an inflation calculator, $1 in 1970 is about $6.21 today.  If the menu is from 1985, the S5 should be $24.29.  Other NU stores have it priced at $19.99.  In any case, for older folk, $20 is a lot to pay for a Pizza, in their mind.  But that’s only because of memory, of times past.  Inflation is a slow subtle tax.  From a ‘real dollar’ perspective, Numero Uno Pizza is cheap.

    Let’s understand the second component of inflation that’s less obvious – the deterioration of QUALITY.  You can get a Pizza today for $5 – but it’s a bunch of crap.  Like any product, you get what you pay for.  This part of inflation, the decline in quality, is less obvious but more damaging.  Every year, products get a little worse and worse.

    The real cause of Pizzaflation

    Real analysts must always seek the CAUSALITY  

    Inflation happens only for one reason:  Central Bank prints more currency.  More currency, chasing the same or fewer goods and assets, makes the price go up.  It’s really simple!  QE (Quantitative Easing) has been rampant in recent years.  Fortunately for consumers, most inflation has happened in financial markets, real estate, and other markets.

    This phenomenon has been covered well in “The Burrito Index:”

    In our household, we measure inflation with the “Burrito Index”: How much has the cost of a regular burrito at our favorite taco truck gone up?

    Since we keep detailed records of expenses (a necessity if you’re a self-employed free-lance writer), I can track the real-world inflation of the Burrito Index with great accuracy: the cost of a regular burrito from our local taco truck has gone up from $2.50 in 2001 to $5 in 2010 to $6.50 in 2016.That’s a $160% increase since 2001; 15 years in which the official inflation rate reports that what $1 bought in 2001 can supposedly be bought with $1.35 today.

    If the Burrito Index had tracked official inflation, the burrito at our truck should cost $3.38—up only 35% from 2001. Compare that to today’s actual cost of $6.50—almost double what it “should cost” according to official inflation calculations.

    Since 2001, the real-world burrito index is 4.5 times greater than the official rate of inflation—not a trivial difference.

    Between 2010 and now, the Burrito Index has logged a 30% increase, more than triple the officially registered 10% drop in purchasing power over the same time.

    Those interested can check the official inflation rate (going back to 1913) with the BLS Inflation calculator by clicking here.

    My Burrito Index is a rough-and-ready index of real-world inflation. To insure its measure isn’t an outlying aberration, we also need to track the real-world costs of big-ticket items such as college tuition and healthcare insurance, as well as local government-provided services. When we do, we observe results of similar magnitude.

    The takeaway? Our money is losing its purchasing power much faster than the government would like us to believe.

    It’s important for consumers to understand, Pizzaflation is not caused by Pizza makers.  Numero Uno actually is doing a great job keeping prices low, because their food cost, rent, and other costs, are all exploding parabolic.

    Los Angeles has the highest rent burden in America:

    Overall, rents in Los Angeles have doubled since the 1970s:

    But of course, that’s not counting other various fees, taxes, increased regulatory costs, increased insurances due to higher crime rates, and other factors.  Pizzaflation has hit Los Angeles hard, creating a ‘double whammy’ for businesses like Numero Uno.  And with LA’s median income flat since 1970, it makes one wonder who can afford a $20 Pizza.  But the remaining Numero Uno stores are mostly packed and have great reviews, so it seems that it takes something really Magic to survive the pressure of the Fed.

    To learn more about how the Fed decreases the value of the US Dollar via Quantitative Easing, checkout Splitting Pennies – Understanding Forex – your pocket guide to make you a Forex genius!  

    The good news, Forex is artificial so you can learn about it online.  It’s all digital.  If you want the best Pizza you’ve ever had in your life – you’ll have to drive all the way to Palmdale, California and visit Numero Uno Palmdale.

  • A Conspiracy Theory About Conspiracy Theories

    Submitted by Paul Rosenberg via FreemansPersepctive.com,

    One of the funny things about conspiracy theories, including false flag attacks, is how often they are proven to be true. You have to wonder how long the shame-inducing slam, “That’s a conspiracy theory,” will keep working.

    But that’s not my point for today. Today, I want to introduce a conspiracy theory of my own, a conspiracy theory about conspiracy theories. Here it is:

    The powers that be – the elite, the deep state, whomever – want wild conspiracy theories to spread. Because after these wild theories set the “outrage meter” very high, they can get away with almost anything below that line.

    In other words, wild theories ensure that the “I’ll act if I see that” trigger is never reached and Joe Average remains docile, even as he is progressively abused.

    I hope I haven’t given any nefarious people ideas, but I think this is already happening. And in any event, I’m fairly certain it’s worth pointing out.

    A Second Theory

    There is a second reason for the lords of the status quo to love conspiracy theories, which is that such theories make it easy to discredit troublesome ideas.

    For example, we now know – thank you again, Edward Snowden – that government agents are infiltrating websites to sow fear, uncertainty, and doubt, as well as to destroy reputations.

    So, rather than just pulling out the usual manipulation to discredit a troublesome idea (“conspiracy theory!”), why not tie it to some really nasty racist crap?

    Lots of people have avoided discussions of the Federal Reserve, for example, because trolls attached to the discussions demonize Jews. Disgusted by anti-Semitism, people turn away from the whole subject, and the central banking scam remains unquestioned.

    There are reasons open comment boards are overrun with hate-spewing trolls, and it’s not that deeply deluded people make up that much of the general populace. (Though they do exist, and they do love to spew their filth.)

    So, this is my second conspiracy theory:

    Disgusting trolls are paid to promote certain ideas… ideas the elite want to eliminate.

    And nowadays, paid trolls aren’t even needed; artificial intelligence bots can carry out the work quite well and can even respond to counter-posts.

    Can I Prove This?

    Not entirely, no. And I’m not going to spend hundreds of hours tracking down evidence. That’s not my job; I’m not an investigative journalist. (Neither is anyone else these days, but that’s a separate point.)

    Still, the links I’ve inserted above prove a lot of what I’m writing, and the rest will have to remain my own personal theories… and I’m just fine with that. People can take them or leave them as they choose.

    The Other Problem

    Beyond everything covered above, the other problem with conspiracy theories is that they are far too hopeful. Yes, hopeful.

    The implication buried in conspiracy theories is that the world is being controlled. Whether it’s controlled by the Illuminati, the Jews, the Masons, or whomever, there is a strange sort of comfort in the idea that the world is controllable.

    The comforting thought goes like this:

    The world is being controlled by evil people. So, if we can just get rid of them, control will revert to good people, and things will be great again.

    This thought is false. The world is not controlled by any single group of people. Rather, it’s a large, chaotic mess. Yes, the deep staters, central bankers, and so on do manipulate a lot of things, but they struggle endlessly and very often fail. Consider just two recent examples:

    • If they were that smart, these groups wouldn’t have allowed the internet to jump onto the scene in the early 1990s.

    • If they were that potent, they would have killed Bitcoin as soon as it appeared.

    The truth is that they’re not that smart, and they’re not all-powerful. In fact, they have power only to the extent that they hoodwink people into serving them. And that’s not an iron-clad arrangement.

    So…

    Presuming that everything above is true, what do we do about it?

    My first thought is that we should stick to facts, not imaginings. I suspect, for example, that Building 7 at the World Trade Center was purposely brought down, but I don’t know that. My suspicions don’t make it true. Furthermore, it isn’t worth obsessing over. There are dozens of more important things to invest with time and energy – like actually building a better world.

    I can’t think of a single conspiracy theory that’s worth majoring upon. Aliens at Roswell or the Kennedy assassination may be fun speculations – and I’d love to know the God’s-honest truth about both – but they’re simply not that important.

    Rather, we should be busy building a better world, bypassing the institutions of abuse that dominate life in the West.

  • FBI Investigating More Dead People Voting In The Key Swing State Of Virginia

    For years the political elites, backed by funding from George Soros, have fought common sense voter ID laws as blatant attempts of racist right wingers to suppress the votes of minority and low-income citizens.  These same people tirelessly argue that there is no evidence of voter fraud despite the mountain of facts that keeps piling up the contrary.  In fact, per the National Review, United States District Judge Lynn Adelman of Wisconsin, in response to a voter ID complaint in that state, recently claimed that “virtually no voter impersonation occurs” in Wisconsin and that “no evidence suggests that voter-impersonation fraud will become a problem at any time in the foreseeable future.”

    Well, we guess that could be true if the pesky facts would just stop getting in the way.  According to research conducted by the Pew Research Center in 2012, the capacity for voter fraud in the U.S. is substantial with nearly 2mm dead people found to be registered voters and nearly 3mm people registered in multiple states. 

    • Approximately 24 million—one of every eight—voter registrations in the United States are no longer valid or are significantly inaccurate
    • More than 1.8 million deceased individuals are listed as voters
    • Approximately 2.75 million people have registrations in more than one state

    And, just earlier today we wrote about how Arcan Cetin, the 20 year old Turkish citizen who recently killed 5 people at the Cascade Mall in Washington, somehow managed to vote in the past 3 election cycles despite not being a U.S. citizen.  When asked about the news, Washington Secretary of State, Kim Wyman, simply said “we don’t have a provision in state law that allows either county elections officials or the Secretary of State’s office to verify someone’s citizenship.”  Sure, because why would someone’s citizenship status be important for determining his eligibity to vote?

    Now, courtesy of WaPo, we know that the FBI is investigating how exactly 19 dead people were recently re-registered to vote in the critical swing state of Virginia.  A few months ago we noted Virginia Governor, and long-time Clinton confidant, Terry McAuliffe‘s willingness to go to great lengths to hand his state’s 13 electoral votes to Hillary by registering 200,000 felons to vote, but adding dead people to the voting rolls seems a bit excessive (see “FelonsVotesMatter (To Hillary) – Clinton’s Election Fate In Virginia Lies With 200,000 Unregistered Offenders“).

    Dead Voters

    Alas, according to WaPo, all 19 deceased voters were originally registered to vote in Harrisonburg and attempts to re-register the deceased voters were only discovered by chance after a clerk recognized one of the names as the deceased father of a local judge.

    All 19 were initially registered as voters in the Shenandoah Valley city of Harrisonburg, although a clerk double-checking the entries later raised questions about one. She recognized the name of Richard Allen Claybrook Sr., who died in 2014 at age 87, because his son is a well-known local judge. She happened to recall that the judge’s father had died.

     

    He was a retired Fairfax County elementary school principal and had fought in World War II,” said his son, retired Harrisonburg General District Court Judge Richard Allen Claybrook Jr. “So our family is very disgusted that they would pick his name, because he was such a law-abiding citizen devoted to public service.”

     

    All of the forms had been submitted by a private group that was working to register voters on the campus of James Madison University, according to the Harrisonburg registrar’s office. The group was not identified. No charges have been filed.

    Meanwhile, state republicans pointed to this as obvious evidence of voter fraud…

    Republicans in the state House of Delegates, who in recent years have supported tighter voter ID laws, held a conference call with reporters to call attention to the investigation.

     

    Oftentimes we hear our Democratic colleagues suggest that voter fraud doesn’t exist in Virginia, or it’s a myth,” House Speaker William J. Howell (R-Stafford) said. “This is proof that voter fraud not only exists but is ongoing and is a threat to the integrity of our elections.

    …while democrats responded with the same ole argument that no fraud occurred because no one actually voted. 

    “First of all, there was no voter fraud — they caught him,” Toscano said. “Nobody cast a vote. . . . There’s still no evidence of that going on in the state. But there is evidence every time you turn around that the Republicans are trying to make it more difficult for citizens to vote in elections.”

    Of course, we just pointed out how the dead in Colorado are actually voting and have been doing so for years…but we’re sure that’s not a concern to Toscano either.

    But something tells us, no matter how many of these types of situations emerge over and over, that U.S. citizens, and common sense for that matter, will never prevail in the war against George Soros and the simple political narrative that voter I.D. laws are somehow racist and/or disenfranchise low-income voters.  

  • US Outcry Over Syria… Tears Followed By NATO Bombs

    Submitted by Finian Cunningham via Strategic-Culture.org,

    The crescendo of US-led condemnations against Syria and Russia over alleged humanitarian crimes in Syria grows louder by the day. The eerie sense is that this «outcry» is being orchestrated as a prelude to a NATO-style intervention in Syria.

    Such a NATO maneuver would follow the template for former Yugoslavia and Libya, leading to greater civilian deaths, territorial disintegration, a surge in regional terrorism and more international lawlessness by Western states.

    The concerted, emotive appeals over the past week – bordering on hysteria – indicate a propaganda campaign coordinated between Washington and its Western allies, the mass media and the US-led NATO military alliance.

    It was US ambassador the United Nations Samantha Power who led the chorus of accusations against Russia and its Syrian ally, using the Security Council emergency meeting last weekend to condemn «barbarism» of renewed violence around the northern Syrian city of Aleppo. Britain and France piled in with more unsubstantiated condemnations of war crimes, as did shameless UN officials, Ban Ki-Moon, the secretary general, and Staffan de Mistura, the UN’s special envoy to Syria.

    Few people would countenance war, but surely Syria has the sovereign right to defend its nation from a foreign-fueled war on its territory. In all the lachrymose lecturing from the likes of Samantha Power, the pertinent question of who started this war in the first place gets lost in rhetorical fog.

    Days later, NATO civilian chief Jens Stoltenberg issued a statement denouncing Russia and Syria for «blatant violation of international laws» in Aleppo, adding that the military actions by both were «morally totally unacceptable».

    All the while, Western news media outlets have run saturation coverage of what they depict as a humanitarian hell in Aleppo, the strategic Syrian city where the final throes of the country’s nearly six-year war seem to be playing out.

    The New York Times published an article with the gut-wrenching headline: ‘The Children of Aleppo, Syria, Trapped in a Killing Zone’.

    It goes on to say: «Among the roughly 250,000 people trapped in the insurgent redoubt of the divided northern Syrian city are 100,000 children, the most vulnerable victims of intensified bombings by Syrian forces and their Russian allies.»

    In a separate article, euronews.com reports: ‘Nowhere to hide’ – volunteer describes conditions inside Aleppo’.

    The implication in the Western mass media is that Syrian and Russian air forces are bombarding indiscriminately across civilian districts of the city. The same desperate tone and bias is ubiquitous in all Western media outlets.

    However, if we ascertain the sources for this saturation information, it turns out to be a limited range of anonymous «activists», or the Western-funded group known as the White Helmets, which purports to be a humanitarian response network, but which in actual fact is integrated with illegally armed insurgents, including the al Qaeda terror organization Jabhat al Fatah al Sham (al Nusra Front), as writer Rick Sterling details.

    Western TV news outlets are routinely using video footage from the White Helmets, supposedly taken in the aftermath of air strikes on Aleppo. This is an astounding abdication of any journalistic ethics of independence and impartiality.

    These same media outlets rarely, if ever, carry reports from the western side of Aleppo where a six-fold greater population – 1.5 million – live in government-held districts, compared with the «rebel-held» eastern quarter.

    As independent writer Vanessa Beeley recently reported, some 600,000 people fled to the western side of Aleppo from the al Nusra-dominant stronghold on the eastern side. According to medics quoted by Beeley, the majority of the population in the eastern quarter are being held hostage as human shields by the insurgents, or as the Western governments and media call them «moderate rebels» and «activists». There are also credible witness reports of terrorists shooting at people fleeing from the east through humanitarian corridors set up by the Syrian government.

    In recent weeks, hundreds of civilians in the western districts of Aleppo have been killed from indiscriminate shelling and sniping by militants from the eastern side.

    When do you ever hear or read the Western media reporting on those crimes? You don’t, because that would unravel the propaganda narrative aimed at demonizing, criminalizing and delegitimizing the Syrian government and its Russia ally.

    And a key leitmotif of the official Western narrative is to create the perception that innocent civilians in Aleppo are being slaughtered by Syria and Russian forces. Both Damascus and Moscow reject claims that they are targeting civilian areas. Moscow has vehemently refuted Western claims that it is committing war crimes. Even the normally jingoistic US outlet Radio Free Europe quotes a legal expert from Amnesty International as saying that there is no evidence to indict Russia of such crimes.

    And because the anti-government militants restrict access to their stronghold, including for UN aid agencies, it is hard to verify the claims and footage coming out of there. Which notwithstanding has not restrained Western media from broadcasting the information verbatim.

    The Western mantra of «humanitarian crisis» and «war crimes» has the unmistakable connotation of contriving a public acceptance of certain policy objectives that Washington and its allies are striving for. At the very least, one of those objectives is to create a political atmosphere whereby Syria and Russia are obliged to comply with calls for no-fly zones, as recently demanded by US Secretary of State John Kerry. So far, Syria and Russia have rebuffed any such initiative, saying that it would give succor to the illegally armed groups who are now decisively in retreat.

    Still, a more far-reaching objective could be Washington and its allies fostering a public mandate for military intervention by the NATO alliance. The outcry over «humanitarian suffering» in eastern Aleppo is a repeat of the «responsibility to protect» (R2P) ploy which NATO invoked to previously intervene and dismember former Yugoslavia in the late 1990s, and a decade later in Libya in 2011.

    The US official inimitably qualified for such a political objective is Washington’s ambassador at the UN – Samantha Power. Her recent diatribes against Russia show a total disregard for diplomatic or legal protocol. Suffused with self-righteousness and selective «humanitarian» concern, Power is evidently leading a media campaign to mandate a NATO force being deployed to Syria’s Aleppo in order to «protect the children trapped in a killing zone» as the New York Times might put it.

    Forty-six-year-old Power has made her entire professional career out of formulating the «R2P» doctrine that has in the past well-served Washington’s imperialist goals.

    As a young reporter in the 1990s, Power wrote one-sided screeds about ethnic cleansing and genocide in the Balkans, which conveniently demonized Serbia, culminating in the NATO bombing of Belgrade in 1999 and the subsequent carve up of Kosovo to become a NATO base. For this service to imperial interests, she was subsequently rewarded with a professorship at Harvard University and a Pulitzer-prize-winning book about genocide, a book which eminent scholars like Edward Herman have debunked as a load of plagiarism and self-serving historical distortions.

    The fiery, Irish-born Power was later promoted by President Barack Obama as an advisor on his National Security Council. It was in this position that she pushed the policy of NATO bombing Libya in 2011 with a reprise of her «R2P» doctrine.

    These NATO military assaults facilitated by emotive appeals to «humanitarian values» have since been shown to be reckless violations of international law amounting to foreign aggression. Earlier this year, the late Serbian leader Slobodan Milosevic was officially exonerated over war crimes allegations, charges that NATO had leveled to justify its bombardment of his country. Also, earlier this month a British parliamentary committee denounced former prime minister David Cameron for his involvement in the NATO intervention in Libya as being unfounded on claims that then Libyan leader Muammar Gaddafi was preparing to slaughter residents in the city of Benghazi.

    But it was so-called «liberal hawks» like Samantha Power who were instrumental in providing political and moral cover for Washington and the NATO military to conduct these illegal foreign invasions and regime changes under the pretext of protecting human rights and civilian lives.

    Obama assigned his useful apparatchik Samantha Power to the United Nations in August 2013, where she has proven to be completely out of her depth in terms of diplomatic finesse. She has infused her position on the Security Council with anti-Russian vitriol in the pursuit of Washington’s hegemonic interests, regardless of international law or objective historical analysis.

    The «humanitarian» propaganda drumbeat over Aleppo belies the facts and circumstances of Washington’s covert war for regime change in Syria. A dirty war in which it and its NATO allies have colluded with a proxy army of terrorist gangs, as this recent German media report by Jurgen Todenhofer confirms.

    Faced with a losing covert war in Syria, through the defeat of its terror proxy forces, it appears that Washington is striving for a more robust intervention in the guise of NATO military deployment, perhaps as «peacekeepers» overseeing a no-fly zone, as seen previously in Libya with disastrous results.

    Emoting about humanitarian concerns is a well-worn prelude for NATO barbarism on behalf of Washington’s geopolitical interests. Crocodile tears followed by bombs. And no better person to carry out this subterfuge than UN ambassador Samantha Power.

  • 4 States Sue To Block Obama's Internet Transition Set For Tomorrow Night

    The US government, much to the chagrin of Senator Ted Cruz, is set to officially relinquish the Department of Commerce’s oversight of the Internet Corporation for Assigned Names and Numbers (ICANN) as of tomorrow night at midnight.  ICANN is a California nonprofit that has supervised website domains since 1998, essentially under subcontract from the Commerce Department. Under the Obama transition plan oversight by the U.S. Commerce Department would end and be replaced by a multi-stakeholder community, which would include the technical community, businesses, civil society and governments.

    Cruz had attempted to block the internet transition by tying the recently passed funding bill to the reversal of the ICANN turnover.  That said, apparently his harsh admonishments on the Senate floor failed to draw enough support from his fellow republicans to force a government shutdown over the topic. 

    “In 22 short days, if Congress fails to act, the Obama administration intends to give away control of the Internet to an international body akin to the United Nations,” Sen. Cruz said. “I rise today to discuss the significant, irreparable damage this proposed Internet giveaway could wreak not only on our nation, but on free speech across the world.”

     

    “The Obama administration is instead pushing through a radical proposal to take control of Internet domain names and instead give it to an international organization, ICANN, that includes 162 foreign countries. And if that proposal goes through, it will empower countries like Russia, like China, like Iran to be able to censor speech on the Internet, your speech. Countries like China, Russia, and Iran are not our friends, and their interests are not our interests.

     

    “Imagine searching the Internet and instead of seeing your standard search results, you see a disclaimer that the information you were searching for is censored. It is not consistent with the standards of this new international body, it does not meet their approval. Now, if you’re in China, that situation could well come with the threat of arrest for daring to merely search for such a thing that didn’t meet the approval of the censors. Thankfully, that doesn’t happen in America, but giving control of the Internet to an international body with Russia, and China, and Iran having power over it could lead to precisely that threat, and it’s going to take Congress acting affirmatively to stop it.

    ICANN

     

    Supporters of the plan counter that critics’ harsh rhetoric fails to recognize that ICANN will be turned over to management by an independent board with representation from all over the world with no single body holding undue influence over decisions.  According to Yahoo, the transition has drawn support from Google and several democrat senators who commented to TechCrunch that “the internet belongs to the world, not to Ted Cruz.”

    “The transition will further strengthen the internet as a stable, resilient and secure tool for empowering billions of people across the globe for decades to come.”

     

    Google senior vice president Kent Walker also endorsed the shift, saying it would “fulfill a promise the United States made almost two decades ago: that the internet could and should be governed by everyone with a stake in its continued growth.”

     

    “The internet belongs to the world, not to Ted Cruz,” Senators Brian Schatz and Chris Coons, and Representatives Anna Eshoo, Doris Matsui, Frank Pallone and Mike Doyle said in an article for the TechCrunch news site.

     

    “If the Republicans successfully delay the transition, America’s enemies are sure to pounce. Russia and its allies could push to shift control of the internet’s core functions to a government body like the UN where they have more influence.”

    But, in a last ditch effort to block the transition, 4 state attorneys general from Arizona, Oklahoma, Nevada and Texas, have filed a lawsuit in a Texas federal court alleging that the transition, in the absence of congressional approval, amounts to an illegal forfeiture of U.S. government property.  According to Politico, the lawsuit also expresses concern that the reorganized ICANN would be so unchecked that it could “effectively enable or prohibit speech on the Internet.”  

    “Trusting authoritarian regimes to ensure the continued freedom of the internet is lunacy,” said Texas Attorney General Ken Paxton in a statement. “The president does not have the authority to simply give away America’s pioneering role in ensuring that the internet remains a place where free expression can flourish.”

     

    “I think, as a matter of philosophy, turning this over ultimately is maybe a great idea in the long run,” the attorney general said, “but I do think there are a lot of stakeholders involved, and we want to make sure no one in the future can limit or suppress access to the internet or punish people for speaking their minds.”

    Given Obama’s recent humiliating loss on the 9/11 lawsuit bill, we’re sure that efforts to block his internet transition plan will draw some attention at the White House.

  • Trump Campaign Releases "Ten Inconvenient Truths About The Clinton Foundation"

    Just a few weeks back we introduced you to the work of Wall Street analyst Charles Ortel who spent the past year and a half digging into the Clinton Foundation and subsequently labeled it as a “Charity Fraud Of Epic Proportions” (see our full post on the findings here:  ““Clinton Foundation Is Charity Fraud Of Epic Proportions”, Analyst Charges In Stunning Takedown“).  As many of our readers know, Ortel is the analyst that uncovered financial discrepancies at General Electric before its stock crashed in 2008, and was described by the Sunday Times of London as “one of the finest analysts of financial statements on the planet” in a 2009 story detailing the troubles at AIG.

    After a year and a half of looking into the Clinton Foundation, Ortel summarized his findings as follows:

    “An educated guess, based upon ongoing analysis of the public record begun in February 2015, is that the Clinton Foundation entities are part of a network that has defrauded donors and created illegal private gains of approximately $100 billion in combined magnitude, and possibly more, since 23 October 1997.

    With that, here’s 10 more things that the Trump campaign thinks you should know about the Clinton Foundation.

    * * *

    Here Are Ten Facts Everyone Should Know About The Massive Conflict Of Interest And Corruption Issues Facing The Clinton Foundation

    FACT ONEThere Are Major Overlaps Between Clinton’s Campaign Donors And Her Foundation Donors, Raising Ethical Red Flags:

    According To The Washington Post, Nearly Half Of The Major Donors To Ready For Hillary And Nearly Half Of Her 2008 Campaign Bundlers Have Given At Least $10,000 To The Foundation. “Nearly half of the major donors who are backing Ready for Hillary, a group promoting her 2016 presidential bid, as well as nearly half of the bundlers from her 2008 campaign, have given at least $10,000 to the foundation, either on their own or through foundations or companies they run.” (Rosalind S. Helderman, Tom Hamburger and Steven Rich, “Clintons’ Foundation Has Raised Nearly $2 Billion — And Some Key Questions,” The Washington Post, 2/18/15)

    • The Clintons Have Relied Heavily On Their Close Ties To Wall Street, With Donations From The Financial Services Sector Representing The Largest Share Of Corporate Donors.”(Rosalind S. Helderman, Tom Hamburger and Steven Rich, “Clintons’ Foundation Has Raised Nearly $2 Billion — And Some Key Questions,” The Washington Post, 2/18/15)

    The Foundation “Has Given Contributors Entree, Outside The Traditional Political Arena, To A Possible President.” “The financial success of the foundation, which funds charitable work around the world, underscores the highly unusual nature of another Clinton candidacy. The organization has given contributors entree, outside the traditional political arena, to a possible president. Foreign donors and countries that are likely to have interests before a potential Clinton administration — and yet are ineligible to give to U.S. political campaigns — have affirmed their support for the family’s work through the charitable giving.” (Rosalind S. Helderman, Tom Hamburger and Steven Rich, “Clintons’ Foundation Has Raised Nearly $2 Billion — And Some Key Questions,” The Washington Post, 2/18/15)

    The Washington Post’s Review Of The Foundation’s Seven Biggest Donors Found “That There Is Strong Overlap Between The Family’s Political Base And The Foundation,” And That A Substantial Number Of Its Donors Are Based Outside Of The U.S. “The review found that there is strong overlap between the family’s political base and the foundation and that a substantial number of the foundation’s largest donors — those who have given at least $1 million — are based outside of the United States. Financial institutions also make up the largest portion of the foundation’s corporate giving.”(Rosalind S. Helderman, “Here Are The Seven Biggest Donors To The Bill, Hillary And Chelsea Clinton Foundation,” The Washington Post, 2/19/15)

    Bill Allison Of The Sunlight Foundation: “The Clinton Foundation Is A Unique Non-Profit That Can’t Be Separated From The American Political System.” “Bill Allison, senior policy analyst at the Sunlight Foundation, a campaign finance watchdog group, says the Clinton foundation is a unique non-profit that can’t be separated from the US political system. ‘If there is foreign money coming into the Clinton Foundation, it will raise the question of – is the president going to be doing favors for a foreign business, a foreign government, a foreign individual? And you just cannot have that in the American system of government, where the president is supposed to represent the American people,’ Allison said.” (Julianna Goldman, “Chinese Company Pledged $2 Million To Clinton Foundation In 2013,” CBS News, 3/16/15)

     

    FACT TWOSeveral Major Clinton Foundation Donations Came From Companies Lobbying The Federal Government:

    The Wall Street Journal Headline: “Hillary Clinton’s Complex Corporate Ties” (James V. Grimaldi and Rebecca Ballhaus, “Hillary Clinton’s Complex Corporate Ties,” The Wall Street Journal, 2/19/15)

    As Secretary Of State Clinton “Was One Of The Most Aggressive Global Cheerleaders For American Companies…” “Among recent secretaries of state, Hillary Clinton was one of the most aggressive global cheerleaders for American companies, pushing governments to sign deals and change policies to the advantage of corporate giants such as General Electric Co., Exxon Mobil Corp., Microsoft Corp. and Boeing Co.” (James V. Grimaldi and Rebecca Ballhaus, “Hillary Clinton’s Complex Corporate Ties,” The Wall Street Journal, 2/19/15)

    • “At The Same Time, Those Companies Were Among The Many That Gave To The Clinton Family’s Global Foundation…” “At the same time, those companies were among the many that gave to the Clinton family’s global foundation set up by her husband, former President Bill Clinton.” (James V. Grimaldi and Rebecca Ballhaus, “Hillary Clinton’s Complex Corporate Ties,” The Wall Street Journal, 2/19/15)

    “At Least 60 Companies That Lobbied The State Department During Her Tenure Donated A Total Of More Than $26 Million To The Clinton Foundation…” “At least 60 companies that lobbied the State Department during her tenure donated a total of more than $26 million to the Clinton Foundation, according to a Wall Street Journal analysis of public and foundation disclosures.” (James V. Grimaldi and Rebecca Ballhaus, “Hillary Clinton’s Complex Corporate Ties,” The Wall Street Journal, 2/19/15)

    “At Least 44 Of Those 60 Companies Also Participated In Philanthropic Projects Valued At $3.2 Billion That Were Set Up Though A Wing Of The Foundation Called The Clinton Global Initiative…” “At least 44 of those 60 companies also participated in philanthropic projects valued at $3.2 billion that were set up though a wing of the foundation called the Clinton Global Initiative, which coordinates the projects but receives no cash for them.” (James V. Grimaldi and Rebecca Ballhaus, “Hillary Clinton’s Complex Corporate Ties,” The Wall Street Journal, 2/19/15)

    “As Secretary Of State, She Created 15 Public-Private Partnerships Coordinated By The State Department, And At Least 25 Companies Contributed To Those Partnerships.” (James V. Grimaldi and Rebecca Ballhaus, “Hillary Clinton’s Complex Corporate Ties,” The Wall Street Journal, 2/19/15)

    Clinton “Has A Web Of Connections To Big Corporations Unique In American Politics—Ties Forged Both As Secretary Of State And By Her Family’s Charitable Interests.” “As Mrs. Clinton prepares to embark on a race for the presidency, she has a web of connections to big corporations unique in American politics—ties forged both as secretary of state and by her family’s charitable interests.” (James V. Grimaldi and Rebecca Ballhaus, “Hillary Clinton’s Complex Corporate Ties,” The Wall Street Journal, 2/19/15)

    “Those Relationships Are Emerging As An Issue For Mrs. Clinton’s Expected Presidential Campaign As Income Disparity And Other Populist Themes Gain Early Attention.” (James V. Grimaldi and Rebecca Ballhaus, “Hillary Clinton’s Complex Corporate Ties,” The Wall Street Journal, 2/19/15)

     

    FACT THREEThe Clinton Foundation Accepted Millions From Foreign Governments:

    Trump

     

    “Rarely, If Ever, Has A Potential Commander In Chief Been So Closely Associated With An Organization That Has Solicited Financial Support From Foreign Governments.” “Rarely, if ever, has a potential commander in chief been so closely associated with an organization that has solicited financial support from foreign governments. Clinton formally joined the foundation in 2013 after leaving the State Department, and the organization was renamed the Bill, Hillary & Chelsea Clinton Foundation.” (Rosalind S. Helderman and Tom Hamburger, “Foreign Governments Gave Millions To Foundation While Clinton Was At State Dept.,” The Washington Post, 2/25/15)

     

    FACT FOURThe Clinton Foundation Accepted Millions From Other Foreign Sources While Clinton Served As Secretary Of State:

    “More Than 40 Percent Of The Top Donors To The Clinton Foundation Are Based In Foreign Countries.” “More than 40 percent of the top donors to the Clinton Foundation are based in foreign countries, according to an analysis by McClatchy.” (Anita Kumar, “Clinton Foundation Limits Foreign Donations,” McClatchy, 4/15/15)

    According To The Wall Street Journal, While The Clinton Foundation “Swore Off Donations From Foreign Governments,” It Was Still Raising Millions From “Foreigners With Connections To Their Home Governments. “The Clinton Foundation swore off donations from foreign governments when Hillary Clinton was secretary of state. That didn’t stop the foundation from raising millions of dollars from foreigners with connections to their home governments, a review of foundation disclosures shows.” (James Grimaldi and Rebecca Ballhaus, “Clinton Charity Tapped Foreign Friends,” The Wall Street Journal, 3/19/15)

    While Bill Clinton Promised The Obama Administration To Stop Accepting Money From Foreign Governments, The Agreement Did Not “Place Limits On Donations From Foreign Individuals Or Corporations.” “Former President Bill Clinton promised the Obama administration the foundation wouldn’t accept most foreign-government donations while his wife was secretary of state. The agreement didn’t place limits on donations from foreign individuals or corporations.” (James Grimaldi and Rebecca Ballhaus, “Clinton Charity Tapped Foreign Friends,” The Wall Street Journal, 3/19/15)

    The Donors Have Personal, Familial, And Business Ties To Foreign Governments. “Some donors have direct ties to foreign governments. One is a member of the Saudi royal family. Another is a Ukrainian oligarch and former parliamentarian. Others are individuals with close connections to foreign governments that stem from their business activities. Their professed policy interests range from human rights to U.S.-Cuba relations.” (James Grimaldi and Rebecca Ballhaus, “Clinton Charity Tapped Foreign Friends,” The Wall Street Journal, 3/19/15)

    During Clinton’s Tenure At The State Department, Foreign Donors And Their Organizations Accounted For Between $34 And $68 Million In Donations And $60 Million In Commitments To The Foundation. “All told, more than a dozen foreign individuals and their foundations and companies were large donors to the Clinton Foundation in the years after Mrs. Clinton became secretary of state in 2009, collectively giving between $34 million and $68 million, foundation records show. Some donors also provided funding directly to charitable projects sponsored by the foundation, valued by the organization at $60 million.” (James Grimaldi and Rebecca Ballhaus, “Clinton Charity Tapped Foreign Friends,” The Wall Street Journal, 3/19/15)

     

    FACT FIVELast Week The Clinton Foundation Announced They Wouldn’t Take Foreign Or Corporate Money If Clinton Is Elected, But Other Charities Still Will Be Allowed To:

    Last Week Bill Clinton Said The Clinton Foundation “Would Only Accept Contributions From U.S. Citizens And Independent Charities” If Hillary Clinton Is Elected President. “The Clinton Foundation will no longer accept foreign and corporate donations if Hillary Clinton is elected president. … Bill Clinton said if Hillary Clinton wins the White House, the family’s foundation would only accept contributions from U.S. citizens and independent charities.” (Ken Thomas, “Clinton’s Foundation To Alter Donations Policy If Elected,” The Associated Press, 8/18/16)

    Other Clinton Charities Will Continue To Take Foreign And Corporate Donations Should Clinton Become President. “Big chunks of the Clinton family’s charitable network would be exempt from a self-imposed ban on foreign and corporate donations if Hillary Clinton wins the presidency, loopholes that highlight the complexity of disentangling her from the former first family’s myriad potential conflicts of interest.” (Annie Linskey, “Not All Clinton Charities Bound By New Set Of Rules,” Boston Globe, 8/20/16)

    These Charities Include The Clinton Health Access Initiative, The Alliance For A Healthier Generation And The Clinton Giustra Enterprise Partnership. “The most prominent of the exceptions applies to the Boston-based Clinton Health Access Initiative, which in 2014 accounted for 66 percent of spending by the Clinton network of charities. … They include the Alliance for a Healthier Generation, an entity cofounded by the American Heart Association and the Clinton Foundation, and the Clinton Giustra Enterprise Partnership, a joint venture between Bill Clinton and Canadian mining billionaire Frank Giustra.” (Annie Linskey, “Not All Clinton Charities Bound By New Set Of Rules,” Boston Globe, 8/20/16)

     

    FACT SIXThe FBI Wanted To Open An Investigation Into The Clinton Foundation, But The Effort Was Scuttled By The Obama Administration:

    The FBI And Department Of Justice Met In Early 2016 To Discuss Opening A Public Corruption Case Into The Clinton Foundation. “Officials from the FBI and Department of Justice met several months ago to discuss opening a public corruption case into the Clinton Foundation, according to a US official.” (Drew Griffin, Pamela Brown and Shimon Prokupecz, “Inside The Debate Over Probing The Clinton Foundation,” CNN, 8/11/16)

    Three FBI Field Offices Wanted To Investigate If Suspicious Banking Activity From A Foreigner Was Involved A Criminal Conflict Of Interest With The State Department And The Clinton Foundation. “At the time, three field offices were in agreement an investigation should be launched after the FBI received notification from a bank of suspicious activity from a foreigner who had donated to the Clinton Foundation, according to the official. FBI officials wanted to investigate whether there was a criminal conflict of interest with the State Department and the Clinton Foundation during Clinton’s tenure. The Department of Justice had looked into allegations surrounding the foundation a year earlier after the release of the controversial book ‘Clinton Cash,’ but found them to be unsubstantiated and there was insufficient evidence to open a case.” (Drew Griffin, Pamela Brown and Shimon Prokupecz, “Inside The Debate Over Probing The Clinton Foundation,” CNN, 8/11/16)

    Obama’s Department Of Justice Pushed Back Against Opening A Case. “As a result, DOJ officials pushed back against opening a case during the meeting earlier this year. Some also expressed concern the request seemed more political than substantive, especially given the timing of it coinciding with the investigation into the private email server and Clinton’s presidential campaign.”(Drew Griffin, Pamela Brown and Shimon Prokupecz, “Inside The Debate Over Probing The Clinton Foundation,” CNN, 8/11/16)

    The FBI Field Offices Were “Waved Off” By The DOJ. “Accusations that Clinton has committed crimes, and gotten away with them, have colored Republican campaigns for decades. They’ve picked up since the FBI announced that it would take no further steps to investigate her ‘careless’ use of a private email server after a year-long probe; they’ve gained more steam after reports that three (of 56) FBI field offices wanted to probe the Bill, Hillary, and Chelsea Clinton Foundation over a foreign donation but were waved off by a DOJ that had come up empty in a similar probe.” (David Weigel, “‘Lock Her Up’ Sentiment Comes To A Congressional Campaign,” The Washington Post, 8/12/16)

     

    FACT SEVENClinton’s Chief Of Staff At State Had A Deep And Simultaneous Involvement In The Clinton Foundation:

    CNN Headline: “Top Clinton State Department Aide Helped Clinton Foundation” (Drew Griffin, “Top Clinton State Department Aide Helped Clinton Foundation,” CNN, 8/11/26)

    It Was Discovered That Clinton’s Chief Of Staff At The State Department Cheryl Mills Went To New York In 2012 To Interview Executives For A Top Position At The Clinton Foundation. “A CNN investigation found that Clinton aide Cheryl Mills was involved in the Clinton Foudnation while she was also employed as Chief of Staff to the Secretary of State. On a trip to New York in 2012, Mills interviewed two executives for a top position at the Clinton foundation. The State Department said she was on personal time. Mills’ attorney says she was, doing ‘volunteer work for a charitable foundation. She was not paid.’” (Drew Griffin, Pamela Brown and Shimon Prokupecz, “Inside The Debate Over Probing The Clinton Foundation,” CNN, 8/11/16)

    “The Fact That The Aide, Cheryl Mills, Was Taking Part In Such A High Level Task For The Clinton Foundation While Also Working As Chief Of Staff For The Secretary Of State Raises New Question About The Blurred Lines That Dogged The Clinton As Secretary Of State.” (Drew Griffin, Pamela Brown and Shimon Prokupecz, “Inside The Debate Over Probing The Clinton Foundation,” CNN, 8/11/16)

    The State Department Has Been Stonewalling Congressional Investigators On This Matter. “The Senate Judiciary Committee, chaired by Republican Chuck Grassley of Iowa, has tried to get answers about Mills’ New York trip as well. Grassley sent Secretary of State John Kerry a letter in January asking the purpose of Mills’ trip. The State Department did not officially respond to the letter.” (Drew Griffin, Pamela Brown and Shimon Prokupecz, “Inside The Debate Over Probing The Clinton Foundation,” CNN, 8/11/16)

     

    FACT EIGHTSidney Blumenthal Collected $10,000 A Month From The Clinton Foundation While Providing Libyan Intelligence To Clinton:

    Clinton Wanted To Bring Blumenthal On Board To The State Department In 2009, But The Hire Was Turned Down By The Obama White House Because Of His “Harsh Attacks” In The Democratic Primary. “As White House chief of staff, Rahm Emanuel was the one to bring the hammer down on Sidney Blumenthal. Secretary of State Hillary Rodham Clinton wanted to hire Mr. Blumenthal, a loyal confidant who had helped her promote the idea of a ‘vast right-wing conspiracy’ more than a decade ago. But President Obama’s campaign veterans still blamed him for spreading harsh attacks against their candidate in the primary showdown with Mrs. Clinton last year. So Mr. Emanuel talked with Mrs. Clinton, said Democrats informed about the situation, and explained that bringing Mr. Blumenthal on board was a no-go.” (Peter Baker and Jeff Zeleny, “Emanuel Wields Power Freely, And Faces The Risks,” The New York Times, 8/15/09)

    Blumenthal “Earned About $10,000 A Month As A Full-Time Employee Of The Clinton Foundation” While At The Same Time He Provided Intelligence On Libya To Then-Secretary Clinton. “Sidney Blumenthal, a longtime confidant of Bill and Hillary Clinton, earned about $10,000 a month as a full-time employee of the Clinton Foundation while he was providing unsolicited intelligence on Libya to then Secretary of State Hillary Clinton, according to multiple sources familiar with the arrangement.” (Kenneth P. Vogel, “Clinton Foundation paid Blumenthal $10K per month while he advised on Libya,” Politico, 5/28/15)

    • Politico Headline: “Clinton Foundation Paid Blumenthal $10K Per Month While He Advised On Libya”(Kenneth P. Vogel, “Clinton Foundation Paid Blumenthal $10K Per Month While He Advised On Libya,” Politico, 5/28/15)

    Blumenthal Was Added To The Clinton Foundation’s Payroll In 2009, “Not Long After Advising Hillary Clinton’s Presidential Campaign — At The Behest Of Former President Bill Clinton…” “Blumenthal was added to the payroll of the Clintons’ global philanthropy in 2009 — not long after advising Hillary Clinton’s presidential campaign — at the behest of former president Bill Clinton, for whom he had worked in the White House, say the sources.” (Kenneth P. Vogel, “Clinton Foundation Paid Blumenthal $10K Per Month While He Advised On Libya,” Politico, 5/28/15)

    Some Clinton Foundation Officials “Questioned” Blumenthal’s “Value And Grumbled That His Hiring Was A Favor From The Clintons.” “While Blumenthal’s foundation job focused on highlighting the legacy of Clinton’s presidency, some officials at the charity questioned his value and grumbled that his hiring was a favor from the Clintons, according to people familiar with the foundation.”(Kenneth P. Vogel, “Clinton Foundation Paid Blumenthal $10K Per Month While He Advised On Libya,” Politico, 5/28/15)

    “When The Clintons Last Occupied The White House, Sidney Blumenthal Cast Himself In Varied Roles: Speechwriter, In-House Intellectual And Press Corps Whisperer.” “When the Clintons last occupied the White House, Sidney Blumenthal cast himself in varied roles: speechwriter, in-house intellectual and press corps whisperer. Republicans added another, accusing Mr. Blumenthal of spreading gossip to discredit Republican investigators, and forced him to testify during President Bill Clinton’s impeachment trial. Now, as Hillary Rodham Clinton embarks on her second presidential bid, Mr. Blumenthal’s service to the Clintons is again under the spotlight.”(Nicholas Confessore and Michael S. Schmidt, “Clinton’s Friend’s Memos On Libya Draw Scrutiny To Politics And Business,” The New York Times, 5/18/15)

    Blumenthal’s Work With Clinton Has Been “Wide-Ranging,” “Complicated,” And Embodied “The Blurry Lines Between Business, Politics And Philanthropy That Have Enriched And Vexed The Clintons And Their Inner Circle For Years.”“But an examination by The Times suggests that Mr. Blumenthal’s involvement was more wide-ranging and more complicated than previously known, embodying the blurry lines between business, politics and philanthropy that have enriched and vexed the Clintons and their inner circle for years.” (Nicholas Confessore and Michael S. Schmidt, “Clinton’s Friend’s Memos On Libya Draw Scrutiny To Politics And Business,” The New York Times, 5/18/15)

    “It May Be Difficult To Determine Where One Of Mr. Blumenthal’s Jobs Ended And Another Began.” “But interviews with his associates and a review of previously unreported correspondence suggest that — once again — it may be difficult to determine where one of Mr. Blumenthal’s jobs ended and another began.”(Nicholas Confessore and Michael S. Schmidt, “Clinton’s Friend’s Memos On Libya Draw Scrutiny To Politics And Business,” The New York Times, 5/18/15)

    “[T]he Clintons’ Past Does Provide Some Evidence That When It Comes To Friends And Politics, They Prize Loyalty Over All Else.” “Why didn’t Clinton do either of those things? Who knows. But, the Clintons’ past does provide some evidence that when it comes to friends and politics, they prize loyalty over all else.” (Chris Cillizza, “Hillary Clinton Is Defending Her ‘Loyal Old Friends.’ Here’s Why That’s A Mistake.,” The Washington Post, 5/19/15)

     

    FACT NINEThe Clinton Foundation Failed To Disclose $26.4 Million In Speaking Honoraria While Clinton Was Secretary Of State:

    Politico Headline: “New Clinton Speech Disclosures Reveal Foundation’s Take”(Josh Gerstein, “New Clinton Speech Disclosure Reveal Foundation’s Take,” Politico, 5/21/15)

    In May 2015, The Clinton Foundation Reported That It Has Received As Much As $26 Million In Previously Undisclosed Speaking Fees. “The Clinton Foundation reported Thursday that it has received as much as $26.4 million in previously undisclosed payments from major corporations, universities, foreign sources and other groups … The money was paid as fees for speeches by Bill, Hillary and Chelsea Clinton. Foundation officials said the funds were tallied internally as “revenue” rather than donations, which is why they had not been included in the public listings of its contributors published as part of the 2008 agreement.” (Rosalind Helderman and Tom Hamburger, “Clinton Foundation Reveals Up To $26 Million In Additional Payments,” The Washington Post, 5/21/15)

    “The Clinton Foundation Confirmed Thursday That It Received As Much As $26.4 Million In Previously Unreported Payments From Foreign Governments And Corporations For Speeches Given By The Clintons.”(Alexandra Jaffe and Dan Merica, “Clinton Foundation Didn’t Disclose As Much As $26M In Speaking Fees,” CNN, 5/21/15)

    The Disclosure Came As The Foundation Faced Questions “Over Whether It Fully Complied With A 2008 Ethics Agreement To Reveal Its Donors And Whether Any Of Its Funding Sources Present Conflicts Of Interest. “The disclosure came as the foundation faced questions over whether it fully complied with a 2008 ethics agreement to reveal its donors and whether any of its funding sources present conflicts of interest for Hillary Rodham Clinton as she begins her presidential campaign.”(Rosalind Helderman and Tom Hamburger, “Clinton Foundation Reveals Up To $26 Million In Additional Payments,” The Washington Post, 5/21/15)

    The Disclosure Of Speaking Fees Was “The Latest In A String Of Admissions From The Foundation That It Didn’t Always Abide By A 2008 Ethics Agreement To Disclose Its Funding Sources Publicly.” “It’s the latest in a string of admissions from the foundation that it didn’t always abide by a 2008 ethics agreement to disclose its funding sources publicly. That agreement, penned as Hillary Clinton became secretary of state, is certain to continue the headache that the foundation’s work and donors have become for Clinton as she makes another run at the White House.” (Alexandra Jaffe and Dan Merica, “Clinton Foundation Didn’t Disclose As Much As $26M In Speaking Fees,” CNN, 5/21/15)

    The Clinton’s Paid Speaking Honorariums Included Six Figure Speaking Fees From Foreign Companies And Wall Street Banks. “The paid appearances included speeches by former president Bill Clinton to the Nigerian ThisDay newspaper group for at least $500,000 and to the Beijing Huaduo Enterprise Consulting Company Ltd., an investment holding company that specializes in the natural gas market, for at least $250,000. Citibank paid at least $250,000 for a speech by Hillary Rodham Clinton.” (Rosalind Helderman and Tom Hamburger, “Clinton Foundation Reveals Up To $26 Million In Additional Payments,” The Washington Post, 5/21/15)

    Clinton Herself Delivered 15 Speeches On The Foundation’s Behalf, “Including One Address To Goldman Sachs And Another To JPMorgan Chase.” “But the new disclosure indicates that the former president has also spent considerable time speaking on the foundation’s behalf — 73 times since 2002. Hillary Clinton has delivered 15 such speeches, including one address to Goldman Sachs and another to JPMorgan Chase.” (Rosalind Helderman and Tom Hamburger, “Clinton Foundation Reveals Up To $26 Million In Additional Payments,” The Washington Post, 5/21/15)

     

    FACT TENSince 2003, The Clinton Foundation Has Spent More Than $50 Million On Travel:

    The New York Post Headline: “Bill Clinton Foundation Has Spent More Than $50 Million On Travel Expenses” (Geoff Earle, “Bill Clinton Foundation Has Spent More Than $50 Million On Travel Expenses,” New York Post, 8/20/13)

    From 2003 To 2012, The Clinton Foundation Spent More Than $50 Million On Travel. “Bill Clinton’s foundation has spent more than $50 million on travel expenses since 2003, an analysis of the non-profit’s tax forms reveal.” (Geoff Earle, “Bill Clinton Foundation Has Spent More Than $50 Million On Travel Expenses,” New York Post, 8/20/13)

    In Just 2011, The Clinton Associated Foundations Spent $12.1 Million On Travel. “The web of foundations run by the former president spent an eye-opening $12.1 million on travel in 2011 alone, according to an internal audit conducted by foundation accountants. That’s enough to by 12,000 air tickets costing $1,000 each, or 33 air tickets each day of the year.” (Geoff Earle, “Bill Clinton Foundation Has Spent More Than $50M On Travel Expenses,” New York Post, 8/20/13)

    The William J. Clinton Foundation Spent $4.2 Million On Travel In 2011. “That overall figure includes travel costs for the William J. Clinton Foundation (to which Hillary and Chelsea are now attached) of $4.2 million on travel in 2011, the most recent year where figures are available.” (Geoff Earle, “Bill Clinton Foundation Has Spent More Than $50M On Travel Expenses,” New York Post, 8/20/13)

    “The Clinton Global Health Initiative Spent Another $730,000 On Travel In 2011, While The Clinton Health Action Initiative (CHAI) Spent $7.2 Million On Travel.”(Geoff Earle, “Bill Clinton Foundation Has Spent More Than $50M On Travel Expenses,” New York Post, 8/20/13)

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Today’s News 29th September 2016

  • IRS Report Reveals How Obamacare "Spread [$11 Billion] Of Wealth Around"

    If folks don’t like their healthcare then they can give us all their money so we can give it to other folks.

    New IRS disclosures from the 2014 tax year reveal the specifics of how the so-called “Affordable Care Act” helped to facilitate Obama’s desire to, as he famously told “Joe the Plumber”, “spread the wealth around.”  To be precise, in 2014, Obamacare spread $11.2BN of wealth around, in the form of healthcare premium tax credits, with nearly 80% going to taxpayers reporting less that $35,000 of adjusted gross income.  Moreover, the average tax filer received $3,600 of healthcare premium support with those in the lowest tax bracket receiving over $5,500 per person.

    Equally disturbing is the fact that 8.1mm tax filers, those who elected to forgo health insurance, were hit with $1.7BN in Obamacare penalties…call it the “young and healthy tax”.  Ironically, 40% of the penalties fell upon people making less than $35,000 per year…the very same people that Obama apparently intended to “help”. 

    Here’s how the subsidies and penalties broke down by tax bracket (the original IRS table can be found here):

    ACA Penalties

     

    Of course, the real tragedy of Obamacare is that even if those 8.1mm young and healthy people wanted to buy health insurance, many of them have now likely been priced out of the market as premiums have soared and coverage “options” have vanished as insurers have pulled out of exchanges all over the country (something we discussed at length in a post entitled “Obamacare On “Verge Of Collapse” As Premiums Set To Soar Again In 2017“).  In essence, while the bill has seemingly “helped” the 3.1mm people receiving subsidies in the chart above it has trapped the 8.1mm young and health people with a permanent tax increase as they are now even less likely to buy health insurance after Obamacare has driven up the rates astronomically.

    But, of course, the Obamacare penalties will only get even worse from here.  According to The Washington Free Beacon, in 2014, uninsured individuals were required to pay the greater of either a flat penalty of $95 for each uninsured adult or 1% of their household’s adjusted gross income.  That said, the penalties are set to increase in 2016 to the greater of a flat fee of $695 or 2.5% of AGI.  According to the Congressional Budget Office, taxpayers are expected to pay penalties of $4BN in 2016 and $5BN annually from 2017 through 2024.

    Senator Tom Cotton (R-Arkansas), also pointed out the irony in the fact that Obamacare is now penalizing many taxpayers who can no longer afford healthcare simply because Obamacare itself has driven up premiums to such an extent they’ve been rendered completely unaffordable.

    “It’s not surprising that the Obamacare mandate numbers are worse than the administration first claimed,” said Sen. Tom Cotton (R., Ark.). “Obamacare penalizes taxpayers who can no longer afford insurance that Obamacare made unaffordable.

     

    “As Obamacare continues to unravel, things will only get worse,” Cotton said. “The legacy of Obamacare is skyrocketing premiums, unaffordable deductibles, the destruction of the individual insurance market, and tax penalties on Obamacare’s victims.

    With that, we’ll leave you with this blast from the past…

     

  • These Are The Best And Worst U.S. Cities For Rising Home Prices

    In its latest update looking at July home prices, Case Shiller pointed out that ” the housing sector continued to expand” at just around 5%, a pace that has held since early 2015.

    Once again that was an understatement: in 15 of 20 of the tracked metro areas, the pace of home appreciation over the past year was 5% or higher, or more than twice the pace of core inflation. And with rents continuing to soar across the country, in many cases at a double digit clip, not to mention exploding healthcare costs, one wonders just what the BLS “measures” with its monthly CPI update.

    In any case, for those lucky Americans who can afford to own a house instead of being stuck renting the New Normal American dream (where they are prohibited from peddling fiction as their annual rent increases by 10% or more each year), here is the breakdown of the top US cities with the highest and lowest home price appreciation.

    At the top, with annual price increases of between 9% and 12%, we find the usual west coast (and thus closest to China) suspects for the second month: Portland, Seattle and Denver, with the cities closest to Vancouver not surprisingly continue to see the highest Y/Y growth. What is surprising is that what until recently was a superstar in this category, San Francisco, has seen its annual price increase drop to just 6.0% from 9.3% in February.

    On the other end once again are Cleveland, Washington and, the worst performer of all, New York.

    Of course, one can debate whether the city with the fastest home price growth, in this case Portland, is “best”, for those who already own a house, or “worst”, for those who are trying to buy one and find it increasingly more unaffordable.

  • Obama Responds To Veto Override…

    Despite all his cajoling and fearmongery, President Obama lost his veto-override virginity today… and is not happy. Speaking at a CNN town hall this evening, the president said that Congress “made a mistake,” and, as The Hill reports, trotted out the tired old excuse that despte their noble intentions, this elimination of sovereign immunity could have unintended consequences.

    As The Hill reports, the override, the first of Obama’s tenure, is a major blow to the president and raises questions about his diminishing sway over Capitol Hill and foreign policy four months before he leaves office. While more stoic than his press spokesperson Josh Earnest’s earlier outrage, Obama’s calm demeanour during tonight’s CNN townhall hid his bitterness which was exposed by his carefully chosen – and well-rehearsed – words…

    the measure sets a “dangerous precedent” in international law that could have negative consequences for the U.S.

     

    “It’s an example of why sometimes you have to do what’s hard,” he added. “And, frankly, I wish Congress here had done what’s hard.”

     

    But, he conceded, “I understand why it happened. Obviously, all of us still carry the scars and trauma of 9/11.”

    Obama reiterated his longstanding argument that the measure carries serious unintended consequences, despite the noble intentions of its supporters.

    The president said the measure could erode the concept of sovereign immunity, leaving  American citizens and assets abroad vulnerable to lawsuits if foreign countries pass reciprocal laws.

    “The concern that I’ve had is — has nothing to do with Saudi Arabia per se, or my sympathy for 9/11 families,” Obama said.

     

    “It has to do with me not wanting a situation in which we’re suddenly exposed to liabilities for all the work that we’re doing all around the world.”

    As usual his words articulately obscure what he is really saying… between the lines… How dare Americans make me accountable for my actions?!

  • How The 'Deplorables' Can Save America

    Submitted by Brandon Smith via Alt-Market.com,

    In my last article, “The Deplorables – Who We Are And What We Want,” I examined the basic philosophies that define what I call the liberty movement; the same group of Americans that Hillary Clinton admonishes as part of her “basket of deplorables.”

    It is important to recognize that only foolish progressives actually take Clinton’s claims at face value. Clinton seeks to characterize a large subset of conservatives as narrow minded when she mentions the “deplorables.” But, it is how she defines “narrow minded” that is the crux of the thing.

    When people like her talk about “racists,” they are referring to conservatives who want a secure southern border. When they talk about “Islamaphobes,” they are referring to people who want to stop Islamic refugees from being bused into the country without being vetted or philosophically and morally acclimated to our way of life. When they talk about sexists, they are usually referring to all males in general, because remember, social justice warriors (SJWs) claim that we are “subconsciously sexist,” even if we think we are fair to women. When they talk about homophobes, they are referring to Christian bakers who do not want to participate in services for gay weddings despite the fact that they should be perfectly free to refuse association with anyone at any time for any reason.

    What Clinton and social justice lunatics are really referring to when they use these attacks are those people who want to be free to think and do as they see fit as long as they are not violating the constitutional rights of others. No one in Hillary’s basket is actually narrow minded, but she and her cronies pigeonhole them as narrow minded anyway.

    Clinton is not actually worried about real racists, or real sexists or real homophobes. What she and the establishment are worried about are true conservatives, because our principles are not built on hate; they are built on reason and truth. It’s easy to defeat a movement driven by hate; it’s next to impossible to defeat a movement driven by truth.

    It is absolutely essential for liberty activists to understand that the goal of the establishment will be to redefine the core of our movement. If they can repaint us as hateful, then we can be beaten. If they can fool us into acting against our principles in the name of winning by any means, then once again, we can be beaten. If we are able to retain our principles and repel the propaganda, then we will NEVER be beaten. Even the greatest war machines on Earth can be crushed by the force of a principled rebellion.

    As my readers know well, I do not hold much optimism for America in the short term. Our economic status is dismal. In my article, “Brexit Aftermath – Here’s What Happens Next,” I warned that global markets would be experiencing a slow grinding decline into the U.S. elections. This is now occurring. It is my belief that international financiers and central banks will pull stimulus support from the global economy just before or just after the elections. I believe that the establishment will attempt to blame conservative movements for the fiscal crisis they created.

    By extension, and as I have been predicting for many months, I believe that Donald Trump will be allowed into the White House. Whether Trump is aware of this dynamic or not, I do not know. The point is, our fight is just beginning, and it has nothing to do with a Trump presidency.

    The U.S. cannot be saved from financial crisis; instability is a mathematical certainty. It is how we respond to this instability that will determine our success or failure. Here is what we “deplorables” must accomplish in the next decade if we are to rebuild America and defeat globalism.

    Put An End To Economic Harmonization

    Economic harmonization is nothing more than a globalist phrase meaning the socialist redistribution of wealth. Globalists and progressives will assert that capitalism is the cause of all our ailments. They will say it leads to an unfair allocation of wealth into the coffers of a select few through the “natural” evolution of corporate power. In reality, most socialist nations work side by side with corporations, and even the existence of the legal corporate model is owed to government interference in free markets. That is to say, there is nothing natural about corporations.

    It was western governments that fabricated special legal protections for corporations including corporate personhood and limited liability. Without government protection, corporations could not exist at their current level of dominance. Therefore, bigger government and more government intervention in free markets will likely only serve to secure even greater empires for the corporate elite.

    These empires can only be dismantled by removing government as a factor in free markets, and allowing true competition in business to return instead of corporate favoritism. As a part of this shift, the middle class must be allowed to thrive through innovation and production. Taxation designed to redistribute wealth only seems to harm burgeoning entrepreneurs and stifles their ability to use good ideas to compete with larger businesses and their superior capital.

    Economic harmonization will eventually result in equality — it will make everyone equally poor. Only a handful of elites will ever be able to pursue economic success within this kind of framework.

    The End Of Forced Multiculturalism

    We’re tired of Cloward-Piven strategies used by cultural Marxists to undermine western principles and heritage. The bottom line is, some cultures are completely incompatible and they should not be roommates. Are we racist for holding this view? No, we’re just being practical. One look at the scheisse-storm hitting Europe right now and only an idiot or a Leftist with an agenda would argue that mass immigration of contrary cultures is a good idea.

    Uncontrolled migrations of peoples from socialist nations into nations that desire free markets will only make the effort towards free markets impossible. Illegal immigration by people who only want taxpayer funded entitlements and that import their socialist ideals as they invade is counter to the health of a liberty-based model.

    Harshly theocratic cultures also will not be able to integrate into a society that respects individual freedom. Social justice groups assume that religious freedom requires us to remain apathetic in the face of unchecked theocratic immigration (as long as it is anything other than Christian).  But, potential immigrants and illegal immigrants do not have legal rights under the U.S. Constitution. Religious freedom has nothing to do with immigration.

    For example, fundamentalist Islamic culture does not mix with the traditional Western ideals of liberty and free market participation. Period.

    Leftists are willfully blind to the distinction. Globalists understand the problem full well and they intend to exploit it. Their goal is to import counter-ideologies en masse in order to annihilate the last vestiges of the West.

    Why? Because this is about eliminating the final obstacle to total globalization. They seek to wash out conservative and classical liberal thinking to make way for a collectivist system that outlaws sovereign philosophies as “barbaric.” It is not exactly an “ethnic cleansing;” more like an ideological cleansing of true conservativism.

    We aren’t going to allow that.

    This is why many in the liberty movement do in fact support a ban on all immigration into Western nations until the damage done by the multicultural cabal can be mitigated. Some may argue for a limited ban on the immigration of certain groups (including Muslims) and this is an issue where the “deplorables” diverge.

    I personally don’t know how such a selective ban could be enforced without an insanely large, intrusive and expensive immigration bureaucracy designed to investigate and weed out millions of people not allowed under such a law. A simpler solution would be to freeze ALL immigration for a period of time (perhaps 10 years or more).

    This would eliminate the need for the U.S. Citizenship And Immigration Services (USCIS). The $3.2 billion allocated to that entity could be spent better securing U.S. borders.

    Frankly, there is nothing wrong with denying citizenship to immigrants for a period of time. The extreme left acts as if open immigration into our country is some kind of human right. It’s not.

    A Less Inclusive Republican Party

    It is perfectly healthy to be discriminating against ideologies and people that are destructive to inherent freedoms. I remember after Barack Obama took office for a second term that the common argument by Democratic and Republican elites alike was that it was “time for the Republican Party to be more inclusive" if they ever wanted to win the White House again.  What that really means in translation is, it was time for the Republican Party to move completely away from conservative values and be more like the Left.

    In reality, the Republican Party needs to stop accommodating socialist and globalist ideals and be more selective in who its friends are, and who its leaders are. Either that, or the party needs to go the way of smallpox and die so that more honest political organizations can take its place.

    The Eradication Of Language Policing

    We “deplorables” have seen political correctness and social justice fear mongering turn our society into a simpering cesspool of terrified effeminate spineless men, deluded miserable vitriolic women who think they are men, and the rest of us who are supposed to walk on eggshells whenever the PC police are around while being sure to use the “proper pronouns.” I think not.

    I think instead, the deplorables are going to say whatever the hell we feel like saying. Why should we concern ourselves with the irrational feelings of others? Why should we censor ourselves just to satisfy the ignorant notion that language shapes environment? Language is irrelevant to our internal monologue. Changing the language is not going to change our souls. Thus, controlling it is pointless and only serves to oppress the public.

    We’re not going to refer to anyone by a gender other than what their genetics dictate. We don’t care if you wear make-up and a wig and a tampon. If you were born with a Y chromosome, then you are a man. Your personal freedoms do not include the right to force others to recognize you as a woman, a “trans,” a diva, a porpoise, etc. Your feelings do not matter. We are no longer going to participate in your gender role-play fantasies.

    Some of us may at times play with race related jokes and have fun at the expense of other groups. We might argue that women actually don’t make very good Ghostbusters or that movies pontificating about slavery are becoming extraordinarily boring. We will probably refer to illegal immigrants as illegal immigrants and stare at beautiful women like we have x-ray vision.

    Understand, there is nothing you can do to stop us, so you might as well spend your time doing something more constructive, like dropping out of gender studies and enrolling in a real college course.

    No More Recognition Of Victim Group Status

    For decades now it has become trendy for anyone besides white heterosexual males to blame all their failures on white heterosexual males. With all the gnashing of teeth over “white male privilege,” we might forget that the only groups with privileges under the law are victim groups. So much government preference is being given to these groups that almost everyone is now clamoring to categorize themselves as a victim in some sense.

    The “transgender” movement is the culmination of this insanity; primarily because there is no such thing as a transgender person except the extremely rare occasion when someone is born with both male and female genitalia. Gender is biological, it is not fluid. You cannot argue with nature about your gender. Laws that govern gender issues should follow biological standards, not hollow psychological standards.

    Today, anyone can simply say they are a victim group by virtue of what amounts to a mental illness. It is time to stop treating this mental illness as a civil rights issue. In turn, it is also time to stop government from designating privileges to groups based on arbitrary victimhood. Everyone today has equal rights under the law. Everything else should be based on merit. If you fail, then it is your own fault. To foster the notion in our society that the evil white man is to blame for all the inadequacies of every loser in the world is to do more harm to those losers than good. Instead, let them take responsibility for their failings so that they might actually strive to do better.

    Limited Government

    There are only a few reasonable purposes behind government — to defend the inborn liberties of the populace, to repel foreign invaders and to secure a sound monetary framework. That’s about it. But while we deplorables see these as limited powers and responsibilities, socialists and globalists see these as excuses for an infinitely expanding government behemoth.

    For example, you can build a functioning military based on the militia model, in which every able-bodied citizen rises to the defense of their community and nation in the event of attack. This would be a cost-effective and less intrusive model.

    Or, you can build a massive standing army with hundreds of bases around the world and a police state here at home, all funded by an unsustainable fiat money and debt system. This would be the big government model, which socialists argue is what government should do to fulfill its role.

    Government can also be used to force private associations in the name of protecting the "rights" of others. A Christian taxpayer might be forced to fund entities they oppose, like Planned Parenthood (which receives around $500 million in tax dollars per year). This is the problem with open-ended nanny government; the individual freedom to associate is violated in the name of protecting the victim status of others.

    This comes from a “fluid interpretation” of the Constitution and the role of government that allows expansion to be rationalized. To put an end to this would require we “deplorables” to assert a literal and limited interpretation.

    True Free Markets

    The establishment has spent the better part of the past 30 years trying to convince the world that globalism is a natural extension of the free market. It’s not. The fact is, globalism is a system thrust upon the people, not an organic evolution of economics.

    True free market philosophy would dictate that if a model is destroying the wealth standards of a society, that society would naturally abandon it. If a model is elevating corporations, which are a product of government charter and are artificially supported by taxpayer dollars, then this is not conducive to real competition. If a model is allowing those same government chartered corporations to export jobs while destroying any chance for smaller competitors to fill the void through unfair taxation and other laws, then this creates economic instability. Without government intervention, globalism would not exist, because no society with a free market would naturally seek to destroy itself.

    The “deplorables” want the end of all welfare, including corporate welfare and the concept of the “too big to fail” company. We want the end of government intervention in business and special favors for corporate elites. We also want the end of central banking and fiat debt based currency. It’s funny, but the mainstream media constantly accuses us of seeking an unfair world, but we are actually the only group of people working for a level playing field.

    This concept terrifies progressives and corporate elites alike because without a socialist welfare system and special treatment for victim groups and companies, all success would then rely on merit. This means, they would have to work harder than most, or be smarter than most or be more naturally gifted than most in order to be more prosperous than most. Take a look at the millennials permeating the halls of universities today — those that espouse socialist ideals –and you will find yourself struggling to identify a single person with exceptional merit or work ethic.

    Take a look at all the banks and corporate monstrosities that should have collapsed eight years ago due to terrible business practices. Under a free market, they would be failures, and rightly so.

    *  *  *

    As mentioned in my first article on the “deplorables,” these changes– which represent a redress of grievances over decades of American corruption –will not take place without years of struggle and sacrifice. Again, this is not about a Trump presidency or any other future election. This is about action on the part of regular men and women, average conservatives, everyday. This is about self sufficiency, localized economies, the return of individual producers, the refusal to comply with social justice-based laws and legislation, the return of community-based security rather than reliance on state and federal security, local efforts for border security, the punishment of criminal financial institutions, etc.; all of which will probably come at the cost of a fight with the establishment.

    While you are welcome to vote for whatever candidate you please, remember that central leadership is not the solution. Self leadership is the solution. We do not need a hero on a white horse. The future is in OUR hands. Only by the efforts of millions of liberty champions in large and small ways can America return to prosperity, and to freedom.

  • Obama Humiliated: For The First Time, Congress Votes To Override President's "Sept 11" Bill Veto

    Summary: US Congress, first the Senate and then the House, humiliated the president when it voted on Wednesday to override Obama for the first time in his eight-year tenure, as the House rejected a veto of legislation allowing families of terrorist victims to sue Saudi Arabia. The House easily cleared the two-thirds threshold with a 348-77 vote to push back against the veto. The Senate voted 97-1 in favor of the override earlier in the day, with only Democratic Leader Harry Reid voting to sustain the president’s veto.

    “We can no longer allow those who injure and kill Americans to hide behind legal loopholes denying justice to the victims of terror,” said House Judiciary Committee Chairman Bob Goodlatte (R-Va.).

    The White House immediately slammed lawmakers following the Senate vote.

    “I would venture to say that this is the single most embarrassing thing that the United States Senate has done possibly since 1983,” press secretary Josh Earnest told reporters aboard Air Force One, an apparent reference to a 95-0 vote to override President Ronald Reagan that year.

    The override was widely expected in both chambers, with lawmakers from both sides of the aisle characterizing it as an act of justice for the victims of the Sept. 11 attacks.

    The so-called Justice Against Sponsors of Terrorism (JASTA) would amend current law to allow victims of terrorist attacks on U.S. soil to sue countries that are not formally designated as sponsors of terrorism — like Saudi Arabia.

    As reported before, the implications for capital markets should the House follow the Senate in overriding Obama’s veto, they could be dramatic: as noted earlier, the threat of the 9/11 bill passing has put on hold Saudi plans to issue its megabond, effectively putting even more pressure on the kingdom’s finances; alternatively as Saudi Arabia has threatened before, should the bill pass, it would (and may have no other choice considering its liquidity crisis) have to sell US reserves, among which billions in Treasurys and an unknown amount of US equities.

    * * *

    Update: moments ago the House also overrode Obama’s veto, meaning that as of this moment, the Sept 11 bill is now law.

    • HOUSE HAS VOTES TO OVERRIDE VETO OF SAUDI BILL, VOTE ONGOING

    This is the first time an Obama veto has been overriden by Congress.

    * * *

    Late last Friday, we reported that in a troubling development for all Americans, Barack Obama sided with Saudi Arabia when he vetoed the Justice Against Sponsors of Terrorism Act , better known as the “Sept 11” bill, allowing Americans to sue Saudi Arabia over its involvement in terrorism on US soil, passed previously in Congress, despite clear signs that the veto may be rejected by both the Senate and the House.

    Moments ago, that is precisely what happened, when the Senate voted overwhelmingly 97 to 1, to override President Obama’s veto of a bill letting the victims of the 9/11 attacks sue Saudi Arabia, striking a blow to the president on foreign policy weeks before he leaves office. The vote marks the first time the Senate has mustered enough votes to overrule Obama’s veto pen.

    Democratic Leader Harry Reid was the sole NO vote.


    As the Hill reported, not a single Democrat came to the Senate floor before the vote to argue in favor of Obama’s position.

    Obama has never had a veto overridden by Congress.

    Ironically, the White House promptly called the veto the most embarrassing action by lawmakers in years. What it failed to comprehend is that it was Obama’s veto of the Sept 11 that was the most embarrassing action by a US president, perhaps ever.

    Lawmakers don’t want to be seen as soft on punishing terrorist sponsors a few weeks before the election, at a time when voters are increasingly worried about radical Islamic terrorism in the wake of recent attacks in Manhattan, Minnesota and Orlando, Fla. Oddly enough, Obama had no problem with those particular optics.

    The House will take up the matter later on Wednesday, and Speaker Paul Ryan told reporters last week that he expects there be to enough votes for an override.

    As a reminder, the legislation, sponsored by Senate Republican Whip John Cornyn (Texas) and Sen. Chuck Schumer (D-N.Y.), the third-ranking member of the Democratic leadership, would create an exception in the Foreign Sovereign Immunities Act to allow the victims of terrorism to sue foreign sponsors of attacks on U.S. soil.

    It was crafted primarily at the urging of the families of victims of the Sept. 11, 2001, attacks who want to sue Saudi Arabian officials found to have links with the hijackers who flew planes into the World Trade Center and Pentagon. It passed the Senate and House unanimously in May and September, respectively, but without roll-call votes.

    “This is pretty much close to a miraculous occurrence because Democrats and Republicans, senators [and] House members have all agreed [on] the Justice Against Sponsors of Terrorism Act (JASTA), which give the victims of a terrorist attack on our won soil an opportunity to seek the justice they deserve,” Cornyn said on the Senate floor before the vote.

    President Obama warned in a veto message to the Senate last week that the bill would improperly give legal plaintiffs and the courts authority over complex and sensitive questions of state-sponsored terrorism. He also cautioned that it would undermine protections for U.S. military, intelligence and foreign service personnel serving overseas, as well as possibly subject U.S. government assets to seizure.

    Obama sent a letter to Senate leaders reiterating his threats concerns that the measure could put U.S. troops and interests at risk.:

    “The consequences of JASTA could be devastating to the Department of Defense and its service members — and there is no doubt that the consequences could be equally significant for our foreign affairs and intelligence communities,” he wrote in the letter, which was later circulated by a public affairs company working for the embassy of Saudi Arabia.

    For once, using threat as a negotiating tactic, especially when on behalf of a foreign sponsor of terorrism and one of the Clinton foundation’s biggest donors, failed to work.

    * * *

    The Saudi Embassy and a high-priced team of lobbyists it hired waged an intense campaign to persuade lawmakers to sustain the override, but it came too late. Surprisingly, the White House seemed to have recognized it as a lost battle and put in less effort, according to Sen. Bob Corker (R-Tenn.), the chairman of the Foreign Relations Committee, who on Tuesday characterized the administration’s lobbying effort as zero.

    Senators who are worried about the risk posed by the bill to U.S. personnel in foreign countries huddled on the Senate floor Tuesday to discuss passing additional legislation to protect them.   These lawmakers acknowledged the 9/11 victims bill had too much political momentum to stop weeks before Election Day, especially after both chambers approved it unanimously. 

    “The focus right now is how can we over a period of time create some corrective legislation to deal with whatever blowback might occur,” Corker said. Ryan told reporters last week that he had concerns with the legislation but said he would nevertheless allow it to come to the floor.

    “I’m going to let Congress work its will because that’s what Congress does. I do think the votes are there for the override,” he said.

    The veto override is a big win for Schumer, whose home state bore the worst of the 9/11 attacks.

    “This bill is near and dear to my heart as a New Yorker, because it would allow the victims of 9/11 to pursue some small measure of justice — finally giving them a legal avenue to hold accountable foreign sponsors of the terrorist attack that took from them the lives of their loved ones,” Schumer said on the floor. He co-sponsored the bill when it was first introduced in December 2009 by the late Sen. Arlen Specter (Pa.).

    Schumer revived the bill last year by teaming up with Cornyn, a fellow member of the Judiciary Committee. They overcame an early objection from colleagues by empowering the president to pause a lawsuit against a foreign government if the administration proves good-faith effort to reach a settlement are underway. The administration initially wanted unilateral authority to stop a lawsuit regardless of the status of negotiations, something the 9/11 families rejected.

    Efforts to override Obama’s vetoes of legislation authorizing construction of the Keystone XL pipeline and a special budget package dismantling the Affordable Care Act failed earlier this Congress.  

    * * *

    Now we wait to see if the Veto is likewise overriden in the House, in what is set to be a historic humiliation for the outgoing Saudi American president.

    As for the implications for capital markets should the House follow the Senate in overriding Obama’s veto, they could be dramatic: as noted earlier, the threat of the 9/11 bill passing has put on hold Saudi plans to issue its megabond, effectively putting even more pressure on the kingdom’s finances; alternatively as Saudi Arabia has threatened before, should the bill pass, it would (and may have no other choice considering its liquidity crisis) have to sell US reserves, among which billions in Treasurys and an unknown amount of US equities.

  • Janet Yellen On The Fed Buying Stocks: "Maybe In The Future, Down The Line…"

    There was an interesting exchange during Janet Yellen’s testimony before the House Financial Services Committee on Wednesday morning, when South Carolina Republican Mick Mulvaney asked Yellen if the Fed will openly (as opposed to indirectly via Citadel) buy stocks. Specifically, he said that “there’s been some attention in the last few months about the resent decision by the Bank of Japan to start purchasing equities and my question to you is fairly simple. Is the United States Federal Reserve looking at the possibility of adding the purchase of equities to its tool box as it looks at monetary policy?”

    This was her response:

    “Well, the Federal Reserve is not permitted to purchase equities. We can only purchase U.S. treasuries and agency securities. I did mention in a speech in Jackson Hole, though, where I discussed longer term issues and difficulties we could have in providing adequate monetary policy. Accommodation may be somewhere in the future, down the line that this is the kind of thing that Congress might consider, but if you were to do so, it’s not something that the Federal Reserve is asking for.”

    And there you have the apolitical Fed hinting to Congress all it would to keep the stock market propped up in perpetuity is a small change in the law for Yellen to lift the offer, or as Chuck Schumer would put it, “get to work Mrs; Chairwoman.”

    Also, not asking for yet, because we are certain that there was a time when neither the BOJ nor the SNB imagined they would have to officially intervene in the stock market to keep it propped up. Furthermore, as the WSJ notes, “Yellen’s tentative openness to changing the law suggests Fed officials have been giving a lot of thought to new ways to jolt the economy in an era of low inflation and low interest rates.”

    Alas, in a time when the Reuters writes that “any ECB scheme to buy stocks could total 200 billion euros“, to keep hammering the idea that central bank purchases of stocks are just a matter of time, we get the feeling that the spot Yellen envisions as being “somewhere in the future” is not that far off.

  • "When Hillary Gets Scared, She Plays The Russia Card"

    By Gary Leupp, Professor of History at Tufts University, originally posted on Counterpunch

    Hillary Clinton’s Campaign Against Russia

    George H. W. Bush’s unsurprising support for Hillary Clinton strengthens the alliance of careful, conniving warmongers (including both neocon and “liberal interventionist” camps), admiring former generals,  middle and upper-class “Clinton Coalition” African-Americans (including clerics and TV commentators like MSNBC’s awful anchor/DNC shill Joy Reid snarling first about Bernie as much as Trump, and now trashing Putin along with Trump), Wall Street donors, older women too driven by identity politics, masochistic and naive former Bernie supporters settling for “the lesser evil,” and miscellaneous communities of the confused.

    It is a rainbow coalition of everyone she needs on board when she starts bombing Syria—seriously bombing Syria, courageously doing so one-upping Barack Obama (who she thinks blew his opportunities to take out Assad in 2011 and 2013) and producing another regime change accompanied by her triumphant Tarzan yell. This time it will be: “We came, we saw, Syria died!”

    Hillary was, you recall, a leading cheerleader of the destruction of the modern Iraqi and Libyan states, and continues to justify those regime-change actions while bemoaning their aftermaths, which she blames on others.

    For someone doing so poorly in the polls, and exciting so little enthusiasm—barely edging over a buffoon whose main purpose seems to be to reveal to the world the depths of the U.S. electorate’s abject ignorance and moral depravity—Hillary can boast on the one hand that the Democratic Party platform is the “most progressive” in the party’s history (thanks to the Bernie supporters, whom she regularly acknowledges, pandering with little success); and on the other hand her candidacy is solidly supported by Goldman-Sachs and the neocons and the whole military-industrial complex. From left to right, such a big tent!

    Everybody else (especially, we’re supposed to believe, less-educated “middle-class” white men over 40) is for Trump. But (the Hillary camp wants to believe) with such high negatives among blacks, Latinos and women Trump can’t win barring some horrible failure of the good people to go to the polls.

    But polls are showing Trump and Clinton neck and neck, or even showing the billionaire leading, including in some key states. This brings out the worst, most dishonest streak in Clinton’s character. Her response indicates that she remains the eternal Goldwater Girl. Running scared, she resorts to the least creative yet tried-and-true ploy imaginable: Cold War-era style redbaiting.

    Never mind that there are few Reds in Moscow anymore, and that Russia is a thoroughly capitalist society posing no threat to the U.S.  Never mind that Russia like the U.S. has a multiparty democratic political system (rigged, like that in the U.S.) and like the U.S. is controlled by its billionaire One Percent (that by the way invests heavily in the U.S. and Britain). There is no ideological divide, and Russia does not head an international ideological movement.

    The basis for its deteriorating relationship with the U.S. and some of its allies is that Washington has steadily expanded NATO to surround the Russian Federation since 1999 (when during Clinton’s husband Bill’s administration it added Poland, Czechoslovakia, and Hungary); wants to add Georgia and Ukraine to the alliance; and spends billions trying to influence elections or fund movements for regime change such as the one that toppled Ukraine’s elected president Viktor Yanukovych in February 2014.

    The U.S. press has virtually ignored one of the most important geopolitical developments of our time. NATO expansion has been a non-story. Russia’s reactions to it (including recent war games held on Russian territory, in response to the biggest NATO war games ever in Poland earlier this year) are invariably depicted as “threatening” to Europe. Vladimir Putin is personally vilified as a brutal dictator who imprisons and assassinates political foes and journalists and has ambitions to restore the Soviet Union.

    All of this is accepted without questions by cable anchors, coached no doubt by news editors who shape the packaging of the news. Instead of noting the obvious fact that NATO is by its very expansion provoking Russia, the mainstream press declares with a straight face that Russia is provoking NATO—by opposing its expansion!

    The reportage on Ukraine has been particularly bankrupt. Talking heads repeatedly refer to Russian “invasions” of the Donbas region of eastern Ukraine and Crimea that never happened. They methodically avoid discussion of the neo-fascist element in the post-coup regime and how its actions prompted separatism among Russian speakers in the east. Journalists for the top newspapers routinely cite unnamed “government officials” as confirming Russian responsibility for all manner of offenses, from shooting down planes to hacking U.S. emails, blissfully free of any need to provide evidence. This is why polls show Putin the most despised man in the U.S.

    The vilification is absurd, especially given the kid gloves treatment of much worse leaders in the U.S. camp. (Turkish President Recep Tayyip Erdogan resembles Putin in many respects but the U.S. press ignores his repression, military aggression, aid to terrorists, and mass detention of journalists.) But the press generally echoes the State Department, to which it is sometimes literally wed (Christiane Amanpour). And the post-Cold War State Department and Pentagon have felt the need to posit a new Enemy in the form of a Russia that threatens its neighbors and (in Syria and elsewhere) supports horrible regimes.

    So when Hillary gets scared, she plays the Russia card. Her campaign has been doing it in several ways. It notes that Trump campaign staffers arranged the removal of a call to arm Kiev against separatists in the Republican platform, implying that this shows Trump’s support for Putin’s objectives in Ukraine (rather than, say, a disinclination to exacerbate the conflict and to support the Minsk Agreement).

    It notes that former Trump campaign manager Paul Manafort also worked as a campaign advisor and lobbyist for Ukraine’s Yanukovich for over a decade, and implies that this connection explains the platform change. (As though there were something especially nasty about a professional political operative from the U.S. selling his services to a politician who won what everyone acknowledges was a “free” election in Ukraine in 2010. But Yanukovych, because he opposed NATO membership for Ukraine and decided to reject EU membership due to the austerity conditions it would impose on Ukraine, was considered “pro-Russian” by the State Department.  Ergo, Manafort must be a Putin agent. Such accusations forced him to resign as campaign manager Aug. 19.)

    The campaign responded to the devastating Wikileaks revelation that the DNC rigged the primary process in favor of Clinton against Sanders—a scandal serious enough to result in the resignation of Debbie Wasserman Schultz and other top DNC officials—by blaming the leaks on Russia! Even if someone in that country hacked the accounts announcing to the world how corrupt the U.S. political process is, what should it matter more than if the hacker was a high school kid in Florida? Because, the Clinton campaign echoed by the entire bourgeois media proclaims, Russia is trying to influence our elections!

    The media sometimes uses the term “bromance” and posits a soul-mate relationship between the Russian leader, who has in fact never met Trump nor said more than a couple sentences relating to him (in answer to reporters’ questions). He has called him “flamboyant” (which is true), not “brilliant” as the press sometimes reports. It’s common sense to imagine that he prefers Trump to the warmongering Clinton, who wants regime change in Syria, and more NATO expansion, and has preposterously compared Putin to Hitler. But Putin has in fact been diplomatically silent on the U.S. election. (RT TV has contrasted this silence to the active U.S. support for the reelection of Russian president Boris Yeltsin, a total buffoon—opposed by the initially more popular Communist Party leader Gennady Zyuganov—in 1996.)

    But Goldwater Girl Hillary wants to make it clear: she is anti-Putin, anti-Russian, while Trump is a Putin fan. (The press refers to Trump’s repeated “praise” for Putin, alluding to his occasional vague comments to the effect that Putin is sharp and popular. But my impression is that his references to Putin are largely allusions to his supposed high estimation of his own narcissistic and solopsistic self. Like the poet Apollinaire, Trump praises all who love him. And he is mercurial. Fawning generals could use these traits to affect his actual policies in power towards Russia. And recall Trump has boasted about being the “most militaristic” of candidates.)

    That the first woman president of the U.S. will be elected (as still seems likely, I think, although not with high confidence) might be brought to power by a coalition of self-defined progressives and war criminals like George H. W. Bush, whipped up in part by tired old Russia-baiting, is depressing. It’s depressing that 27 years after the end of the Cold War it’s still possible to exploit a Russian bogeyman to win support for hot war.

    That Hillary in power will try (and possibly) succeed in going to war once again, this time targeting Russia or its allies (the Syrian state, the Ukrainian Russian separatists), is frightening.  The electorate is malleable, its collective memory short. What should be universally acknowledged truths (the Iraq War was based on lies, produced horrible death and suffering, generated more terrorism that spread to Syria, etc.) are in fact not grasped adequately by the masses. If they were, how could anybody vote for hideous Hillary?

    Remember how the ratings of an unpopular (and actually un-elected) president named George W. Bush leaped from around 50% at 9/11 to 70% just before the invasion of Iraq. Weak, unpopular presidents are sufficiently motivated to study history as to realize that war brings scared people together, causing them to unite around you. While the good thing about this nationally embarrassing farce will be the election of a highly unpopular president (vulnerable to overthrow), the really, really bad thing is that president might provoke World War III with Russia.

    In that connection it might be worthwhile to check out the anti-Goldwater ad of the Democrats in 1964, raising this very issue. Fear, people, fear.

    * * *

    Gary Leupp is Professor of History at Tufts University, and holds a secondary appointment in the Department of Religion. He is the author of Servants, Shophands and Laborers in in the Cities of Tokugawa JapanMale Colors: The Construction of Homosexuality in Tokugawa Japan; and Interracial Intimacy in Japan: Western Men and Japanese Women, 1543-1900. He is a contributor to Hopeless: Barack Obama and the Politics of Illusion, (AK Press). He can be reached at: gleupp@tufts.edu

     

  • How Much Money Have Humans Created – A Visual History

    The dollar amounts are so staggering, that simply telling you how much money humans have created probably wouldn’t convey the magnitude. However, The Money Project's data visualization in this video, allows us to relate numbers in the millions, billions, and trillions to create the context to make it more understandable.

    Source: Visual Capitslist

    Starting With Context

    The median U.S. household income of $54,000 is a number that most people can relate to. It’s enough money to save up to buy a car, or maybe even a house depending on where you live.

    Multiply that income by eight, and that number is now big enough to count as being in the top 1% of earners. People in the “one percent” make at least $430,000 per year.

    Famous celebrities and businesspeople have fortunes that dwarf those of many “one percenters”. Actor George Clooney, for example, has a net worth of $180 million. Meanwhile, author J.K. Rowling is estimated to have a net worth of roughly $1 billion according to Forbes.

    Zuckerberg takes things to a whole new level. His net worth worth is $53 billion, thanks to the value of Facebook stock. Lastly, Bill Gates regularly tops the “richest people” lists with a wealth of $75 billion – though lately that number has been a little higher based on stock fluctuations.

    However, even the wealth of the richest human on Earth is not enough to get up to our unit of measurement that we use in the video: each square is equal to $100 billion.

    The World’s Money

    Some of the world’s biggest companies take up just a few squares with our unit of measurement. ExxonMobil for example has a market capitalization of about $350 billion, and the world’s largest public company by market capitalization, Apple, is at about $600 billion.

    The total of the world’s physical currency – all coins and bills denominated in dollars, euros, yen, and other currencies – is about $5 trillion.

    Meanwhile, if we add checking accounts to the equation, the number for the amount of money in the world goes up to $28.6 trillionaccording to the CIA World Factbook. This is called “narrow money”.

    Add all money market, savings, and time deposits, and the number jumps up to $80.9 trillion – or “broad money”.

    But that’s nothing compared to the world of Wall Street.

    Wall Street

    All stock markets added together are worth $70 trillion, and global debt is $199 trillion.

    That’s all impressive, but the derivatives market takes the cake. Derivatives are contracts between parties that derive value from the performance of underlying assets, indices, or entities. On the low end, the notional value of the derivatives market is estimated to be a whopping $630 trillion according to the Bank of International Settlements.

    However, that only accounts for OTC (over-the-counter) derivatives, and the truth is that no one actually knows the size of the derivatives market. It’s been estimated by some that it could be as high as $1.2 quadrillion, and others estimate it could be even higher.

    There are many financial critics who worry about the risk that these contracts pile onto the global financial system. With the sheer size of the derivative market dwarfing all others, it’s understandable why business mogul Warren Buffett has called derivatives “financial weapons of mass destruction”.

  • Libertarian Gary Johnson Has Another "Aleppo Moment"

    If the rest of the world was already laughing violently, watching the spectacle that is America’s presidential election, we wonder how it would react if it knew that there is actually a third candidate for the US presidency, one who can’t name a single foreign world leader.

    Sadly, that is precisely what happened today when during a New Hampshire townhall moderated by MSNBC’s Chris Matthews, libertarian candidate Gary Johnson had another “Aleppo moment” when asked who his favorite foreign leader is, as the clip below shows.

    It did not end there.

    Johnson continued, adding that Hillary Clinton would likely start a nuclear war if faced with a tough split-second decision. “I think she is going to press the button … She is going to be hawkish, she is going to be more hawkish in that role,” Johnson said. “I think that she is not going to air on the side of not being an aggressor.”

    The presidential candidate added that he would be the only candidate who could be trusted with the nuclear codes as president.

    “I think she is going to shoot. She is going to shoot. She is not going to be herself. She is not going to be perceived as weak. She is going to shoot,” he said later.

    And just to make it fair, former Massachusetts Gov. Bill Weld, Johnson’s running mate, said that Donald Trump is not to be trusted with the nuclear codes either, and pointed to the GOP nominee’s past support for countries like Japan and South Korea expanding their own nuclear capabilities. Weld said Trump would be better off running a laundry business than campaigning to become the President of the United States.

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  • "The Only Way Out Is Creative Destruction" Sinn Fears "Self-Inflicted Malaise"

    Authored by Hans-Werner Sinn, originally posted at Project Syndicate,

    Almost exactly eight years ago, the Lehman Brothers collapse plunged the global economy into recession. The interbank market collapsed, and the entire industrialized world was thrown into the worst crisis since the end of World War II. Though central banks have maintained ultra-low interest rates, the crisis hasn’t yet been fully overcome. On the contrary, numerous economies, such as the southern European countries and France, simply aren’t making any headway. And Japan has been on the ropes for a quarter-century.

    Some economists believe that this is evidence of “secular stagnation,” a phenomenon described in 1938 by the American economist Alvin Hansen, who drew on Karl Marx’s Law of the Tendency of the Rate of Profit to Fall. Owing to the gradual exhaustion of profitable investment projects, according to this view, the natural real interest rate has continued to fall. Stabilizing the economy thus is possible only by an equivalent decline in policy interest rates.

    In view of the huge credit bubble that preceded the crisis in Japan, the United States, and southern Europe, and the aggressive policies pursued by central banks over the last few years, I doubt that this theory is correct. In fact, I find it plausible that a very different mechanism lies behind the post-2008 stagnation, which I refer to as “self-inflicted malaise.”

    This hypothesis is best understood in the context of the economist Joseph Schumpeter’s theory of the business cycle. Faulty expectations on the part of market participants regularly cause credit and asset-price bubbles. Investors, expecting prices and incomes to rise, purchase residential and commercial properties, and they take chances on new business ventures. Real-estate prices start to rise, a construction boom occurs, and a new phase of rapid expansion begins, partly sustained by the revitalization of the domestic economy, including services. The growth in incomes increasingly emboldens borrowers, which further heats things up.

    Then the bubble bursts. Investment collapses and real-estate prices fall; businesses and banks go bankrupt; factories and residential buildings are vacated; and employees are laid off. Once prices and wages have fallen, new investors step in with new business ideas and establish new firms. After this “creative destruction,” a new phase of rapid expansion sets in.

    In the current crisis, however, monetary policy preempted the creative destruction that could have formed the basis for a new upswing in growth. Asset holders talked central bankers into believing that Schumpeter’s economic cycle could be overcome by large-scale bond purchases financed via the printing press, and by corresponding interest-rate reductions.

    To be sure, these measures stopped the fall in asset prices halfway and thus saved much wealth. But they also prevented sufficient numbers of young entrepreneurs and investors from risking a new start. Instead, established firms remained in place, keeping themselves afloat but lacking the wherewithal for new investments. In Japan and Europe, in particular, large numbers of such zombie firms and banks survived, and they are now blocking would-be competitors able to drive the next upswing in growth. The resulting economic ossification looks like the secular stagnation that Hansen described; in fact, the malaise is self-inflicted.

    And, because low interest rates have reduced asset managers’ returns, some central banks – and the European Central Bank, in particular – have relied on successive interest-rate cuts in an effort to engineer ersatz value gains for assets. The economy is thus caught in a trap, forcing the ECB to engage in ever more radical monetary-policy measures. Its current program of quantitative easing is meant to double the money supply in a very short period. Further guns are being moved into position, such as successively more negative nominal interest rates or so-called helicopter money.

    The only way out of the trap is a hefty dose of creative destruction, which in Europe would have to be accompanied by debt relief and exits from the eurozone, with subsequent currency devaluations. The shock would be painful for the incumbent wealth owners, but, after a rapid decline in the dollar values of asset prices, including land and real estate, new businesses and investment projects would soon have room to grow, and new jobs would be created. The natural return on investment would again be high, meaning that the economy could expand once again at normal interest rates. The sooner this purge is allowed to take place, the milder it will be, and the sooner Europeans and others will be able to breathe easy again.

  • Deutsche CEO Goes Full 'Dick Fuld': Bailout "Out Of The Question" Sees "Few Risks… Comfortable Liquidity"

    Will John Cryan's name go down in the annals of financial history lore alongside Erin Callan, Joe Gregory, and Dick Fuld?

    Given the extreme level of denial and hubris the Deutsche Bank CEO reportedly uses in an interview with Germany's Bild magazine, we'd say chances are better than even.

    Echoing Fuld's blustering 2008 description of a Lehman balance sheet with "billions in highly liquid assets," along with his plan to sell prized assets, and threats to "hurt the shorts";

     

    Deutsche's Cryan stated unequivocally that the bank is "comfortably equipped with free liquidity," that he sees no need for a capital raise – as he plans to sell Postbank – and a state bailout "is not an issue for us,"  could not understand "how someone can say that."

    As a reminder, here are some special moments from Fuld and Callan's mouths as Lehman fell…

    March 2008: Lehman had eliminated close to 4,000 jobs in the last year.

     

    April 2008: "The worst of the financial crisis impact is behind us" … "environment will remain challenging for a while"

     

    " by adhering to strong risk-management standards and running the company well, "I will hurt the shorts, and that is my goal."

     

    Lehman has more than $35 billion of cash and liquid assets and another $65 billion of "unencumbered" assets that aren't pledged elsewhere and can easily be turned into cash, Fuld and Chief Financial Erin Callan said Tuesday.

    And here, as Bild reports, is Deutsche Bank's CEO John Cryan explaining that everything is fine, nothing to see here… (via Google Translate)

    The CEO of Deutsche Bank sees no need for state support of his institution. In an interview with "Bild" (Wednesday) John Cryan said aloud advance notification to the question whether the Bank need government aid: "This is not an issue for us."

     

    The manager had also jected reports and speculation about alleged talks with German Chancellor Angela Merkel (CDU) on state aid for the German bank. "I have not asked the Chancellor at any time for help. I have indicated like nothing." Cryan said. He could not understand "how someone can say that."

     

    Even its shareholders do not want to ask for help of the German Bank CEO. "The question of a capital increase currently does not arise," said the manager. The Bank met all regulatory capital requirements. They have "far fewer risks in the books than in the past" and was "comfortably equipped with free liquidity".

     

    The CEO described the situation of Deutsche Bank as better than it was currently perceived from the outside.

    So no capital increase, plenty of liquidity, and fewer risks?

    Investor jitters were stoked by a preliminary Justice Department request that the bank pay $14 billion to resolve a probe into its handling of mortgage-backed securities. The company has said it expects to whittle down the settlement amount, just as other Wall Street banks did during their talks.

    “It was clear from the beginning that we would not pay this sum,” Bild quoted Cryan as saying.

     

    “The Department of Justice will treat us with the same fairness as American banks that have already agreed on a compromise."

    The bank is also selling assets (just like Lehman)…

    The CEO stressed that he considers the planned sale of Postbank started: ".. Everything is ready, we could pass Postbank tomorrow into new hands – but then the price has to be right, we have time."

    When asked whether there would be a bonus waiver for directors like 2016 again next year, Cryan said:

    "We're in a difficult transition, everyone knows that no one harbors unrealistic expectations.."

    So there you have it. Nothing to see here at all. All you hedgers and speculators are crazy…

     

    So who blinks first? The ECB – knowing the collateral chains that will snap. The Bundesbank – knowing their entire banking system is at risk. The German government – knowing it's over for them if DB depositors have to take a haircut… Or Brussells – who know the entire EU plan is teetering is done if anything but the 'rules' are applied to Deutsche. For now, there is one thing for sure – the market will press for one of these players to be forced to make decision.

  • General Market Commentary 9-27-2016 (Video)

    By EconMatters


    We talk about various markets from Bonds and Gold to Natural Gas and Oil in this video. Something seems to be going on underneath the radar in crude oil, maybe we are starting to experience some tighter markets right here. API had draws across the board tonight in the Oil Market.

    © EconMatters All Rights Reserved | Facebook | Twitter | YouTube | Email Digest | Kindle   

  • A Few Uncomfortable Truths You Won't Hear From The 2016 Presidential Candidates

    Submitted by John Whitehead via The Rutherford Institute,

    “If liberty means anything at all, it means the right to tell people what they do not want to hear.”—George Orwell

    In the interest of liberty and truth, here are a few uncomfortable truths about life in the American police state that we will not be hearing from either of the two leading presidential candidates.

    1. The government is not our friend. Nor does it work for “we the people.”
    2. Our so-called government representatives do not actually represent us, the citizenry. We are now ruled by an oligarchic elite of governmental and corporate interests whose main interest is in perpetuating power and control.
    3. Republicans and Democrats are not sworn enemies so much as they are partners in crime, united in a common goal, which is to maintain the status quo.
    4. Presidential elections are not exercises in self-government. They are merely business forums for selecting the next CEO of the United States of America, Inc.
    5. No matter which candidate wins this election, the police state will continue to grow. In other words, it will win and “we the people” will lose.
    6. The lesser of two evils is still evil.
    7. There is virtually no difference between psychopaths and politicians.
    8. Americans only think they’re choosing the next president. In truth, however, they’re engaging in the illusion of participation culminating in the reassurance ritual of voting.
    9. The U.S. government has become a greater menace to the life, liberty and property of its citizens than any of the so-called dangers from which the government claims to protect us.
    10. The government knows exactly which buttons to push in order to manipulate the populace and gain the public’s cooperation and compliance.
    11. Fear, which now permeates the populace, leads to fascism.
    12. If voting made any difference, they wouldn’t let us do it.
    13. America’s shadow government—which is comprised of unelected government bureaucrats who operate beyond the reach of the Constitution—is the real reason why “we the people” have no control over our government.
    14. The government does whatever it wants.
    15. You no longer have to be poor, black or guilty to be treated like a criminal in America. All that is required is that you belong to the suspect class—that is, the citizenry—of the American police state.
    16. Whether instigated by the government or the citizenry, violence will only lead to more violence. Anyone who believes that they can wage—and win—an armed revolt against the American police state is playing right into the government’s hands.
    17. “We the people” are no longer shielded by the rule of law.
    18. Government eyes are watching you. Every move you make is being monitored, mined for data, crunched, and tabulated in order to form a picture of who you are, what makes you tick, and how best to control you when and if it becomes necessary to bring you in line.
    19. Private property means nothing if the government can take your home, car or money under the flimsiest of pretexts, whether it be asset forfeiture schemes, eminent domain or overdue property taxes. Likewise, private property means little at a time when SWAT teams and other government agents can invade your home, break down your doors, kill your dog, wound or kill you, damage your furnishings and terrorize your family
    20. If there is an absolute maxim by which the federal government seems to operate, it is that the American taxpayer always gets ripped off.
    21. From the moment they are born to the time they legally come of age, young people are now wards of the state.
    22. Americans are powerless in the face of militarized police.
    23. Government bureaucrats believe they have the right to search, seize, strip, scan, spy on, probe, pat down, taser, and arrest any individual at any time and for the slightest provocation.
    24. Forced cavity searches, forced colonoscopies, forced blood draws, forced breath-alcohol tests, forced DNA extractions, forced eye scans, and forced inclusion in biometric databases are just a few ways in which Americans continue to be reminded that we have no control over what happens to our bodies during an encounter with government officials.
    25. Finally, we all bleed red. And we all suffer when violence becomes the government’s calling card. Remember, in a police state, you’re either the one with your hand on the trigger or you’re staring down the barrel of a loaded gun. The oppression and injustice—be it in the form of shootings, surveillance, fines, asset forfeiture, prison terms, roadside searches, and so on—will come to all of us eventually unless we do something to stop it now.

    These are not problems that can be glibly dismissed with a few well-chosen words, as most politicians are inclined to do. Nor will the 2016 elections do much to alter our present course towards a police state.

    Indeed, the popularity contest for the new occupant of the White House will not significantly alter the day-to-day life of the average American greatly at all. Those life-changing decisions are made elsewhere, by nameless, unelected government officials who have turned bureaucracy into a full-time and profitable business.

    As I point out in my book Battlefield America: The War on the American People, these problems will continue to plague our nation unless and until Americans wake up to the fact that we’re the only ones who can change things for the better and then do something about it. Indeed, the Constitution opens with those three vital words, “We the people.”

    What the founders wanted us to understand is that we are the government.

    There is no government without us—our sheer numbers, our muscle, our economy, our physical presence in this land. There can also be no police state—no tyranny—no routine violations of our rights without our complicity and collusion—without our turning a blind eye, shrugging our shoulders, allowing ourselves to be distracted and our civic awareness diluted.

    No matter which candidate wins this election, the citizenry and those who represent us need to be held accountable to this powerful truth.

  • Caught On Tape: Hackers Take Control Of A Moving Tesla From Miles Away

    Tesla can’t seem to catch a break this year with multiple accidents blamed on the company’s autopilot feature, earnings misses and huge cash burns on lower than expected deliveries that have resulted in the company hitting its bank “funding limit”, and a controversial proposed merger with SolarCity.  Fortunately, none of this has really mattered to shareholders who keep supporting the stock near its all time highs. 

    As such, we suspect that Chinese hackers posting the first-ever evidence on youtube that they can hack into moving Teslas and control the vehicles from miles away won’t be of much concern to shareholders either. 

    Nevertheless, we present the following startling footage of Tesla Model S vehicles being remotely controlled by hackers who demonstrate the ability to manipulate everything from overriding the internal displays to opening locked doors and slamming on the brakes while the car is moving.  Seems pretty safe, right?

    The following footage shows a hacker slamming on the brakes of this Model S from 12 miles away.

    teslagif1.gif

     

    Per Forbes, the hack by Tencent’s Keen Security Labs Team was the first demonstration of anyone proving they could remotely control vehicles, making the potential for real-world attacks a little more realistic.

    Keen said it had informed Tesla’s security team of multiple vulnerabilities in the latest models running the most recent software. Moreover, the hacks were found to work on various versions of the Tesla Model S and are believed to also work across all marques.

    A Tesla spokesperson acknowledged the Keen hack and said it had issued an over-the-air update to “address” the vulnerabilities even though the “risk to our customers was very low.”

    “Within just 10 days of receiving this report, Tesla has already deployed an over-the-air software update (v7.1, 2.36.31) that addresses the potential security issues.  The issue demonstrated is only triggered when the web browser is used, and also required the car to be physically near to and connected to a malicious wifi hotspot. Our realistic estimate is that the risk to our customers was very low, but this did not stop us from responding quickly.”

    We agree, it’s probably nothing to worry about.

    The full video can be viewed here:

  • Viral Surveillance Video Reveals A Shocking Scene From China's Housing Bubble

    Chinese home prices in August rose the most in more than six years, indicating local government efforts to avert a housing bubble have failed. Average new-home prices in the 70 cities rose 1.2% in August from July, the biggest increase since January 2010, while the value of home sales jumped 33% last month from a year earlier. At the same time, prices in Tier 1 cities, soared 3.5%, the most on record.

    Still, in ongoing efforts to limit speculation in China’s latest housing bubble, cities such as Hangzhou have phased in ownership rules like banning those born outside the city from owning more than one property. Alas, squeezing demand represents a misguided way to tame a bubble, because if anything it leads to bursts of buying, sending prices soaring, followed by just as sharp plunges as the greater fools panic and rush to offload, forcing the initial rule to be undone, resetting the cycle… something which last happened in China in 2013 and is taking place again now.

    Nowhere was this seen better than on a surveillance camera recording which captured China’s sheer housing bubble lunacy in its shocking raw intensity.

    As People’s Daily reports, a surveillance camera – and the resulting viral video – caught the moment new real estate in east Hangzhou opened for sale on September 24. The resulting spree was prompted by the abovementioned new restrictions launched on Monday, which prevents people born outside Hangzhou from buying more than one property.  What is mind-boggling is that despite one of the buying lunatics caught in the stampede literally tearing down the entrance door, all the properties sold out in a matter of hours.

  • Bridgewater Calculates How Much Time Central Banks Have Left

    One of the key themes that have emerged in the past year is that, having loaded up their balance sheets with tens of trillions in various assets, central banks are “running out of road.” While it is a topic extensively discussed on these pages, going all the way back to 2014, a good summary of the practical limitations on central banks comes from the following series of charts from Deutsche Bank.

    The first slide looks at the bond transmission mechanism, namely that central banks have become increasingly aware of the adverse impact of low bond yields on financial sector profitability; another aspect is that European pension liabilities as a % of market cap are at a 10-year high – and above the levels they reached in 2008, when the European market cap was at half the current level. This means that absent an independent rise in inflation expectations, central banks’ attempts to push up nominal bond yields (via less QE or faster hikes) risks leading to higher real bond yields as well; the implication is that equities tend to de-rate when real bond yields rise (i.e. the discount rate increases).

    There is a limitation from the standpoint of markets as well: European 12-month forward P/E, at 14.9x, is around 20% above its 10-year average; DB notes that its P/E model suggests that this deviation is fully accounted for by the fact that real bond yields are 180bps below their 10-year average; more troubling is the admission that any removal of monetary accommodation would likely lead to a sharp rise in credit spreads to reflect the deterioration in fundamentals (with default rates now at 5.7%), while equity strategist note that accommodative monetary policy has driven aggregate bond and equity valuations to the highest level since 1800

    In the third slide, DB points out that while equities would likely react positively to any rise in nominal bond yields driven by higher inflation expectations (rather than by higher real bond yields), underlying inflation is only likely to accelerate if growth accelerates to be clearly above potential (i.e. the output gap closes). Meanwhile, weakening growth momentum in the US points to downside risks for inflation, and that since the Chinese RMB is still around 10% overvalued – and any renewed devaluation is likely to weigh on DM inflation expectations.

    * * *

    Ok fine, central banks are “running out of road”, however at the same time they are terrified to rip (or even peel) the band-aid off. This has put the system in an unstable equilibrium: on one hand, central bankers – as even they admit – need to hand over the growth impulse over to governments, yet on the other hand, they terrified of even the smallest change to the status quo as they know they may undo some 7 years of “wealth effect” creation overnight.

    How much longer can this charade continue?

    While many would be quick to answer “indefinitely” that is not true, because with every bond, ETF or stock, purchased by central bankers they come to the point where they either monetize the entire lot, or they increasingly impair the functioning of the capital markets (just ask the dozens of marquee hedge funds that have shuttered in recent years).

    Luckily, in a recent analysis, Ray Dalio’s Bridgewater asked precisely this question, and even better, provided the answer to how much time is left until both the ECB and BOJ hit the limits on their existing programs.

    As the chart below shows, assuming no changes to existing programs, the ECB and the BOJ, the two central banks most actively monetizing debt currently, have 8 and 26 months respectively, if they do no changes to their programs.

    However, if incremental easing is layered on, like expanding the scope of their bond buying programs or purchasing equities even more aggressively, the total rises substantially. The final answer: 68 months, or just above 5 and a half years,  in the case of the ECB, were it to steamroll all political opposition and monetize virtually every possible bond (and 20% of the equity market), and 48 months, or 4 years, in the case of the BOJ.

    Which means for those market participants who have already torn most of their hair out from participating in a centrally planned “market” where nothing makes sense, get ready because, the insanity may last another 4 or 5 years longer…

  • "The Donald Nailed It" Stockman Screams "We Are In A Big Fat Ugly Bubble"

    Submitted by David Stockman via Contra Corner blog,

    Most of the 90 minutes last night was a wastewith both candidates lobbing well-worn clichés, slogans and sound bites at the audience and each other.

    But there was one brief moment that made it all worthwhile. That was when Donald Trump peeled the bark off the Fed’s phony recovery narrative and warned that the stupendous stock market bubble it has created will come crashing down the minute it stops pegging rates to the zero bound.

    “……Typical politician. All talk, no action. Sounds good, doesn’t work. Never going to happen. Our country is suffering because people like Secretary Clinton have made such bad decisions in terms of our jobs and in terms of what’s going on.

     

    Now, look, we have the worst revival of an economy since the Great Depression. And believe me: We’re in a bubble right now. And the only thing that looks good is the stock market, but if you raise interest rates even a little bit, that’s going to come crashing down.

     

    We are in a big, fat, ugly bubble. And we better be awfully careful. And we have a Fed that’s doing political things. This Janet Yellen of the Fed. The Fed is doing political — by keeping the interest rates at this level. And believe me: The day Obama goes off, and he leaves, and goes out to the golf course for the rest of his life to play golf, when they raise interest rates, you’re going to see some very bad things happen, because the Fed is not doing their job. The Fed is being more political than Secretary Clinton.

    Trump thereby landed a direct hit on the false Wall Street/Washington postulate that the Fed has been the nation’s economic savior. And he also elicited an almost instant defense of its destructive, anti-capitalist regime of Bubble Finance—-albeit in the guise of a “fact check” by the New York Times’ Fed reporter, Benyamin Appelbaum.

    To be sure, there were actually no “facts” to check in Trump’ statement. It was simply an entirely correct judgment that the utterly unnatural interest rates engineered by the Fed have fueled an egregious inflation of financial asset prices and that “some very bad things” are going to happen when the Fed’s market rigging operation is finally halted.

    Still, and opinion or not, Appelbaum emitted a barrage of harrumphing and scolding, implying that Trump is some kind of yokel who does not understand the sacred independence of the Fed:

    In attacking the Fed, Mr. Trump is plowing across a line that presidential candidates and presidents have observed for the past several decades. There has been a bipartisan consensus that central banks operate most effectively when they are shielded from short-term political pressures. Indeed, President Richard M. Nixon’s insistence that the Fed should not raise rates in the early 1970s played a role in unleashing a long era of inflation — and in convincing his successors that it was better to leave the Fed to its technocratic devices.

    Technocratic devices? Now that is downright balderdash because what the Fed is doing is profoundly and resoundingly political.

    To wit, after 94 months on the zero bound the Fed has executed the most massive income and wealth transfer in American history. Upwards of $2.5 trillion has been extracted from the hides of main street savers and retirees over that eight year period (@ $300 billion per year). All of that and then some was gifted to the banks and Wall Street speculators.

    Needless to say, a wealth redistribution that monumental in scope and capricious in impact would never see the light of day among the unwashed “politicians” that Appelbaum apparently thinks are too benighted to be involved in monetary policy. That’s because whether or not they embrace the Keynesian nostrum that saving is bad and debt is good, the nation’s politicians are smart enough to know that the sweeping fiscal transfer at the core of Fed policy would be shouted down by the voters in a thunderous chorus of denunciation and derision.

    Stated differently, the politician at least know that if the Congress were to enact anything remotely similar to the Fed’s savage and relentless attack on savers and wage-earners, they would be on the receiving end of the torches and pitchforks that would descend on the Imperial City.

    In fact, this wanton redistribution from savers to debtors and speculators is occurring only because a happenstance of history has put lethal financial power in the hands of an insulated, unelected monetary politburo; and one that has been taken-over by a tiny posse of delusional and power-hungry Keynesian academics, to boot.

    Journalistic hacks like Appelbaum, along with Steve Liesman of CNBC and Jon Hilsenrath of the Wall Street Journal, not only exhibit the worst kind of access-driven mendacity; they also faithfully perpetuate all the myths, shibboleths and outright lies that insulate the Fed from any policy accountability whatsoever.

    In the case at hand, Appelbaum claims that it was Nixon’s manhandling of the spineless Fed Chairman, Arthur Burns, in the run-up to the 1972 election that proved the case for the strict “independence” of the Fed. The  resultant decade-long inflationary wave instigated by the nefarious Tricky Dick, therefore, was the inadvertent founding event; it allegedly fostered a newly minted separation of powers doctrine that has invested the 12 members of the FOMC with virtually dictatorial powers over the nation’s financial system.

    Well, yes, Nixon was the evil-doer that paved the way to our present form of mutant casino capitalism. But it was not because Arthur Burns had a propensity to bend over in the presence of great power.

    To the contrary, the real evil happened in August 1971 when Nixon was persuaded by a passel of so-called free market economists, led and inspired by Milton Friedman, to trash the Bretton Woods system, and sever the dollar’s last link to anything other than the whims and economic theories of the FOMC.

    It did take several decades, of course, for the denizens of the Eccles Building to realize that with the shackles of gold and convertibility removed, they were free to generate dollar liabilities at will. Indeed, the great Paul Volcker fully understood what had happened at Camp David, and strove mightily during the next decade, first at the NY Fed and then in the Eccles Building, to keep the fiat genie bottled-up via sheer intellectual discipline and willpower.

    But it couldn’t last, and not just because Alan Greenspan checked in his hard money doctrines in the cloak room of the Eccles Building the first day he arrived and never reclaimed the check. What happened was that the financial press discovered that it could swap journalistic integrity for access, and the rest is now history.

    What has materialized, in fact, is a cult of central bank flattery and subservience that is every bit in the emperor has no clothes modality. Not since the days of Bill Greider has a mainstream journalist even dared to suggest that Fed policies have untoward effects on the people or that its real function is to serve the interests of its Wall Street masters.

    But now it’s gotten downright hideous. There is not an honest price left in any precinct of the financial system. Dangerous, unstable speculative bubbles infest every corner of the money and capital markets.

    Likewise, the Fed’s fatuous policy of inflation targeting has caused the massive off-shoring of breadwinner jobs to the China Price for goods and the India Price for services. And that wasn’t the half of it.

    At the same time, this sweeping and perverse job destruction policy has generated massive slack in the domestic labor markets—upwards of 180 billion hours in quantitative terms. That overhang, in turn, has suppressed nominal wage rates in the middle and bottom end of the labor market, causing wage-earners to fall increasingly behind a relentlessly rising cost of living.

    And then it has added insult to injury by fueling the fantastic bubble in the stock market that Trump so accurately called-out last night. Its not just that it will soon crash and wipe-put tens of trillions of paper wealth. Actually, the real evil of ZIRP and QE has already been done.

    To wit, can anyone not drinking the Wall Street Cool-Aid believe that John Stumpf and his patron, St, Warren Buffet, were actually running a bank?

    In fact, the C-suites of corporate America have been turned into stock gambling dens, and corporate balance sheets have been strip-mined to fund the greatest financial engineering ponzi schemes every conceived.

    The truth is, Janet Yellen is a paint-by-the-numbers academic fool who has no clue about the havoc she and her posse have unleashed on the American economy. Yet she gets away with it exactly owing to the “Fed independence” cover story so mendaciously peddled by the likes of Appelbaum, Liesman and Hilsenrath.

    Thank heavens for the Donald. He knows a rigged job when he sees it, and, at least last night, was undomesticated enough to let 100 million voters hear the truth.

  • WA Goes After Pre-Crime: Gun Confiscation Proposed For Those "Likely To Commit Violence In The Near Future"

    A new ballot measure being considered by voters in Washington State, officially referred to a Initiative Measure 1491, would allow authorities to seize guns from people considered “significantly more likely to commit violence toward themselves or others in the near future.”  The legislation would allow authorities with a court order to seize an individual’s guns for a period of up to 1 year.  Under the measure, gun owners would have the right to appeal a court order to have their guns returned but would have no ability to block the upfront confiscation.

    The full text of Initiative Measure 1491 is included at the end of this post but below are a couple of key excerpts:

    This act is designed to temporarily prevent individuals who are at high risk of harming themselves or others from accessing firearms by allowing family, household members, and police to obtain a court order when there is demonstrated evidence that the person poses a significant danger, including danger as a result of a dangerous mental health crisis or violent behavior.

     

    Studies show that individuals who engage in certain dangerous behaviors are significantly more likely to commit violence toward themselves or others in the near future. These behaviors, which can include other acts or threats of violence, self-harm, or the abuse of drugs or alcohol, are warning signs that the person may soon commit an act of violence.

     

    Individuals who pose a danger to themselves or others often exhibit signs that alert family, household members, or law enforcement to the threat. Many mass shooters displayed warning signs prior to their killings, but federal and state laws provided no clear legal process to suspend the shooters’ access to guns, even temporarily.

    I-1491

     

    According to the Wall Street Journal, if the measure passes, Washington would become the second state after California to allow family members and police to petition a judge to take guns from a person considered a danger. Connecticut, Indiana and Texas have similar laws, but only police can ask a judge to do so.

    Aside from all the obvious issues surrounding unreasonable seizures of personal property, another key issue with the bill is the broad definition of people who can petition authorities to confiscate someone’s guns.  Per the measure’s definition of “Family or Household Member”, any disgruntled former “dating partner” could allege mental instability and have someone’s personal property confiscated as a form of retribution.  

    Family or household member” means, with respect to a respondent, any: (a) Person related by blood, marriage, or adoption to the respondent; (b) Dating partners of the respondent; (c) Person who has a child in common with the respondent, regardless of whether such person has been married to the respondent or has lived together with the respondent at any time; (d) Person who resides or has resided with the respondent within the past year; (e) Domestic partner of the respondent; (f) Person who has a biological or legal parent-child relationship with the respondent, including stepparents and stepchildren and grandparents and grandchildren; and (g) Person who is acting or has acted as the respondent’s legal guardian.

    While the WSJ has alleged that the bill has bipartisan support, the state’s Republican Party and gun-right’s groups are slightly less “enthusiastic” with the Washington State Rifle and Pistol Association saying “it’s just an excuse to go after guns.”

    The state Republican Party has yet to take a position on the initiative, and Ms. Hutchison said she doesn’t know if it is a solution.

     

    “That’s something that sounds very good on the surface,” said Joe Waldron, legislative chairman for the Washington State Rifle and Pistol Association. “It’s just an excuse to go after guns.”

     

    Mr. Waldron said he is concerned that the measure would deprive gun owners of their constitutional rights, including due process and protections against unreasonable search and seizure.

    What are the chances this bill has any impact at all on violent crime in the state of Washington?

     

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Today’s News 27th September 2016

  • George Soros' False Flag Factories

    Submitted by Wayne Madsen via Strategic-Culture.org,

    Global hedge fund tycoon and political provocateur George Soros is leading a war of symbols, namely flags and banners either resurrected or conjured up by his myriad non-profit groups, to stir religious, racial, and ethnic tensions the world over. From the Serbian OTPOR! movement and its clenched-fist symbol adopted by protests groups around the world to the menacing black and white flag of the Islamic State, which first appeared during the Soros-backed «Arab Spring» rebellions, Soros’s «false flag» factories have been running at break-neck production speeds.

    Soros and his acolytes saw the importance of symbology in the writings of Gene Sharp of the Albert Einstein Institution in Boston, Massachusetts. Although Sharp’s catechism of how to conduct non-violent resistance and revolution has been likened by some political scientists to Mohandas Gandhi and Dr. Martin Luther King, his concepts on upsetting the political status quo appear to be borrowed more from the likes of Mao Zedong, Karl Marx, and Adolf Hitler.

    Among Sharp’s necessary tools to conduct political action are «flags and symbolic colors», «slogans, caricatures, and symbols», and «banners, posters, and displayed communications». The «symbolic colors» have been used by Soros- and Central Intelligence Agency-sponsored «color revolutions» in Ukraine (Orange) and Kyrgyzstan (Pink) and attempted color revolutions in Iran (Green), Kuwait (Blue), and Burma (Saffron).

    Using the Sharp template and financing from Soros and the CIA-linked National Endowment for Democracy (NED), Symbols were used in the themed Arab Spring revolutions in Tunisia (Jasmine) and Egypt (Lotus) and attempted revolutions in Georgia (Rose), Lebanon (Cedar), Uzbekistan (Cotton), and Moldova (Grape).

    It is now more than obvious that Soros and his minions, known as «Sorosites» – a clever play on «parasites» – in the Balkans, contracted with flag factories to churn out banners of former regimes in the uprisings in Libya and Syria. In Libya, the rebels who rose up against Libyan leader Muammar Qaddafi in 2011 brandished factory-fresh, still-creased red-black-green horizontal tricolor with the white crescent and star used by the old Libyan monarchy, the regime that Qaddafi overthrew in 1969.

    Almost simultaneously, Syrian rebels opposed to President Bashar al-Assad hit the streets of major Syrian cities with factory-fresh green-white-black horizontal tricolors with three red stars used by Syria during the French League of Nations mandate and by the Republic of Syria in 1961. It was obvious that in both cases, the Soros- and NED-sponsored opposition groups in Libya and Syria foresaw a return to a pro-Western Libya as had existed under the feudalistic King Idris until his overthrow in 1969 and a Syria not unlike the pro-Western regime of Major-General Abd al-Karim Zahr as-Din, a Druze who ousted the pro-Gamal Abdel Nasser regime in Damascus in 1961. However, for Soros and the regime change advocates under U.S. Secretary of State Hillary Clinton, there would be disappointment.

    Instead of pro-Western regimes taking power in Libya and Syria, major swaths of territory fell to jihadist forces who mainly owed allegiance to the Islamic State but with a few swearing loyalty to Al Qaeda. Regardless of what jihadist entity they supported, these rebel groups received support from Saudi Arabia, the Turkish Islamist government of Recep Tayyip Erdogan, and the Gulf emirates of Qatar, Abu Dhabi, Dubai, Sharjah, and Kuwait.

    Instead of the flags of the former pro-Western proxy regimes appearing over buildings in Libya and Syria, factory-fresh black and white flags of the Islamic State of Iraq and the Levant (ISIL) flew from flagpoles, windows, and balconies from Benghazi and Sirte to Tripoli and Derna. In Syria, new ISIL flags were raised from Raqqa and Majib to Idlib and Palmyra. To the east, in Iraq, ISIL flags replaced those of the U.S.-installed Iraqi government and the Kurdistan Regional Government.

    One indication as to the source of the new ISIL flags was reported on October 7, 2014 by the Jewish Telegraph Agency from the northern Israeli town of Nazareth Illit. Gardeners in the factory area of the city discovered a bag that had fallen onto a street from a truck. Twenty-five new black and white ISIL flags were found inside the bag.

    A number of questions were raised by the discovery. Were the flags manufactured by a factory in the Jewish city? It is known that the Israeli military provided logistical and other support to jihadists fighting across the Golan Heights border in Syria. Were ISIL flags part of Israeli propaganda support to the jihadist rebels? Additionally, did Soros and the NED outsource the production of ISIL, as well as the flags of former Arab regimes, to the Israelis for distribution in Libya and Syria?

    Soros’s connections to ISIL became very apparent during the opening session of the United Nations General Assembly when some human rights advocates, including some linked to Soros’s nongovernmental organizations, called for the International Criminal Court (ICC) to prosecute the leadership of ISIL. The ICC, which is heavily influenced by Soros organizations, balked at the idea of prosecuting ISIL officials and operatives.

    The ICC claimed that since neither Syria nor Iraq were parties to the 1998 Rome Statute, which created the court, ISIL commanders and ground troops could not be hauled before the international tribunal to answer for their crimes against humanity in those countries. The ICC has had no problem prosecuting leaders and military officers from the Balkans and Africa, but ISIL was deemed off-limits.

    The ICC was also prepared to put members of the Qaddafi family on trial for alleged crimes in Libya, however, ISIL and its affiliates in Libya were of no interest to the court. The main reason for the ICC to look askance at ISIL is because in any trial of the group’s leadership, the «false flag» antics of the Saudis, Israelis, Turks, Emiratis, the Soros organizations, and the Americans might have been laid bare for all the world to see.

    Soros’s false flag antics are not merely confined to the Middle East. The eruption of violence among African-Americans in response to police violence targeting mainly African-American men saw new flags bearing the slogan «Black Lives Matter» being raised in cities and towns across the United States. It is well-known that Soros finances the Black Lives Matter group and the flags appeared to be yet another use of banners, slogans, and symbols in keeping with the template of Sharp and his themed revolution model.

    While «Black Lives Matter» flags appeared throughout America, historical flags like the 13-star «Betsy Ross» flag from the American Revolution; the Gadsden Flag bearing the motto «Don’t Tread on Me», a slogan popularized by Benjamin Franklin; and any flag bearing any symbols from the Confederate States of America were denounced by Soros-funded pressure groups as «racist». There were demands that these historical American flags be banned from cemeteries, parks, historical battlefield sites, and other locations. This was yet another «false flag» attack by Soros and those who actually wish to alter American history and impose a regime of extreme political correctness in violation of the free speech clause of the U.S. Constitution.

    As a result of Sharp’s roadmap to revolution, flags and symbols are potent weapons. Police in Spain have found ISIL flags in towns located in southern Spain, the location of the old Al Andalus Caliphate that the Islamic State has vowed to «liberate» from Christianity. Turkish flags are found in greater numbers in some German neighborhoods than German flags. Hispanic groups protesting Republican presidential candidate Donald Trump wave factory-fresh Mexican flags. The telltale signs of George Soros and CIA destabilization efforts can be found in the flags that appear in crowds of protesters. Vexillology intelligence (Vexint), or flag intelligence, should become a branch of every major intelligence agency around the world.

  • I Prefer Donald Trump over Hillary Clinton (Video)

    By EconMatters


    Donald Trump might just be outside the career politician mode enough to address some of the structural issues facing this country over the next four years that sadly Hillary Clinton will just continue perpetuating with the status quo. I expect out of control spending and continued fiscal mismanagement during Hillary Clinton`s Presidency.

     

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  • Debate Post-Mortem: Rematch Required As Commentators Split On Debate Winner, Markets Give Hillary Nod

    From "big, fat, ugly bubbles" to "trumped-up trickle-down" economics, tonight's debate had something for everyone. One-liners and soundbites were dropped like confetti with strange facial gestures, delicate coughs, and direct jabs flying left, right, and center. As far as the results go, it's anyone's guess: Lester Holt was soundly beaten by everyone online; the markets (S&P Futs and the Mexican Peso) both suggested a Trump loss, Trump won Twitter, online (and unscientific) polls were undecided with a slight nod to a Trump victory, as commentators were mixed, most siding with their ideological bias.

    As Bloomberg reports, after a little more than 90 minutes of debate (full transcript here), here are the key takeaways from tonight's event:

    The candidates spent a good deal of time on stop-and-frisk, racial issues, Obama birther matter, ISIS and nuclear weapons.

     

    Trump appeared to be rambling on a number of questions, especially on foreign policy.

     

    Clinton made points on the tax returns, with Trump not ending questions about whether he failed to pay any federal income taxes — an not offering a clear reason as to why he's not releasing his tax returns.

     

    Clinton's answers often were recitations of her campaign statements.

     

    It was difficult for Holt, as moderator, to keep the candidates focused on the questions. At times, it appeared he'd lost control of the debate.

    Behind their glazed eyes…

     

    Some Key Excerpts

    Clash of the Titans…

     

    Then Hillary struck…

     

    Quickly followed by Trump…

    And…

     

    Trump on 'birtherism'

    "I got him to give the birth certificate," he said about President Barack Obama.

    Trump on his temperament

    "I think my strongest asset by far is my temperament. I have a winning temperament," Trump said.

    Trump on taxes

    "That makes me smart," Trump said in response to Clinton saying he might not pay federal income taxes.

    Clinton on her emails

    "I made a mistake using private email," Clinton said.
    "That's for sure," Trump added.

    How rich?

    "Maybe he's not as rich as he says he is … There is something he's hiding … Who does he owe money to?" Clinton speculating on why Trump hasn't released his tax returns.

    Trump Won The Drinking Game:

     

    Trump Won Twitter:

     

    Polls Were Mixed:

    Drudge – as expected – big trump win, suggesting whoever was for Trump before, remained with Trump:

     

     

    NJ.com – Trump win.

     

    Time.com – Hillary win.

    Fortune.com – Small Trump win.

     

    The Hill: Trump slightly ahead:

     

    On the other hand, judging by the market's response, Trump lost:

     

    Judging by the surge in futures and the Mexican peso, markets judged the first of three U.S. presidential debates a win for Hillary Clinton: U.S. stock index futures reversed losses, while Mexico’s peso rebounding from a record low and haven assets including the yen and gold fell.  S&P 500 futs gained 0.4 percent as shares in Asia pared losses. Mexico’s peso rose as much as 1.5 percent, although rolled over toward the end of the debate.

    *  *  *

    She Said…

    • *CLINTON SAYS KEY ELECTION QUESTION IS WHAT FUTURE FOR U.S.
    • *CLINTON SAYS NEED TO BUILD AN ECONOMY FOR `EVERYONE'
    • *CLINTON SAYS NEED TO INVEST IN INFRASTRUCTURE, RENEWABLES
    • *CLINTON CALLS FOR RAISING MINIMUM WAGE, MORE PROFIT SHARING
    • *CLINTON SAYS WEALTHY NEED TO `PAY THEIR FAIR SHARE'
    • *CLINTON: TRUMP'S TAX PLAN IS TRUMPED UP TRICKLE-DOWN ECONOMICS
    • *CLINTON SAYS TRUMP `ROOTED FOR THE HOUSING CRISIS'
    • *CLINTON, TRUMP SPAR ON ECONOMIC RECORD OF BILL CLINTON'S YEARS
    • *CLINTON: `DONALD, I KNOW YOU LIVE IN YOUR OWN REALITY'
    • *TRUMP: YOU HAVE NO PLAN; CLINTON: I WROTE A BOOK ABOUT IT
    • *CLINTON: I HAVE A FEELING I'LL BE BLAMED FOR EVERYTHING
    • *CLINTON ON PRIVATE EMAILS: I MADE A MISTAKE; TRUMP AGREES
    • *CLINTON SAYS SHE'S MET PEOPLE `STIFFED' BY TRUMP'S BUSINESSES
    • *CLINTON: RACE REMAINS `SIGNIFICANT' CHALLENGE IN U.S.
    • *CLINTON: TRUMP PAINTS `DIRE, NEGATIVE' PICTURE OF BLACK AMERICA
    • *CLINTON SAYS WANTS TO END PRIVATE PRISONS IN STATE SYSTEMS TOO
    • *CLINTON SAYS TRUMP INVITING RUSSIA TO HACK WAS `UNACCEPTABLE'
    • *CLINTON SAYS TRUMP BACKED IRAQ WAR AND LIBYA INTERVENTION
    • *CLINTON SAYS TRUMP HAS `CAVALIER ATTITUDE' ON NUCLEAR WEAPONS
    • *CLINTON SAYS U.S. CAMPAIGN HAS CAUSED WORRY FOR WORLD LEADERS

    He Said…

    • *TRUMP SAYS U.S. JOBS `FLEEING THE COUNTRY' INCL. TO MEXICO
    • *TRUMP: THEY'RE USING OUR COUNTRY AS PIGGY BANK TO REBUILD CHINA
    • *TRUMP: WE HAVE TO STOP OUR JOBS FROM BEING STOLEN FROM US
    • *TRUMP CITES FORD, CARRIER SAYING NEED TO KEEP COS. IN U.S.
    • *TRUMP CALLS CLINTON BY SECRETARY TITLE, ASKS IF THAT'S OK
    • *TRUMP INTERJECTS ON CLINTON ATTACK: `THAT'S CALLED BUSINESS'
    • *TRUMP SAYS U.S. ENERGY POLICIES ARE A `DISASTER'
    • *CLINTON, TRUMP SPAR ON ECONOMIC RECORD OF BILL CLINTON'S YEARS
    • *TRUMP SAYS NAFTA IS THE WORST TRADE DEAL SIGNED ANYWHERE
    • *TRUMP SAYS CLINTON FLIPPED ON TPP AFTER HIS CRITICISMS
    • *TRUMP: YOU HAVE NO PLAN; CLINTON: I WROTE A BOOK ABOUT IT
    • *TRUMP SAYS WE HAVE NO LEADERSHIP, THAT STARTS WITH CLINTON
    • *TRUMP SAYS CLINTON A `TYPICAL POLITICIAN,' THAT SHE'S ALL TALK
    • *TRUMP SAYS THE FED IS NOT DOING THEIR JOBS, BEING POLITICAL
    • *TRUMP ON E-MAILS: THAT WAS NOT A MISTAKE, DONE PURPOSEFULLY
    • *TRUMP ON RACIAL DIVIDE, SAYS NEED TO HAVE `LAW AND ORDER'
    • *TRUMP: TEND TO AGREE W/ BLOCKING GUNS FOR THOSE ON NO-FLY-LIST
    • *TRUMP: BLACK COMMUNITY HAS BEEN `LET DOWN' BY POLITICIANS
    • *TRUMP SAYS HE GOT OBAMA TO PROVIDE HIS BIRTH CERTIFICATE
    • *TRUMP SAYS CLINTON ALLIES PEDDLED OBAMA BIRTHPLACE QUESTIONS
    • *TRUMP SAYS DOESN'T KNOW IF RUSSIA HACKED DNC, COULD BE OTHERS
    • *TRUMP: ISLAMIC STATE COULDN'T HAVE FORMED IF WE'D TAKEN THE OIL
    • *TRUMP SAYS IDEA HE SUPPORTED IRAQ WAR IS MEDIA NONSENSE
    • *TRUMP SAYS HE HAS MUCH BETTER TEMPERAMENT THAN CLINTON DOES
    • *TRUMP: NUCLEAR WEAPONS ARE NUMBER ONE THREAT NOT CLIMATE CHANGE
    • *TRUMP ON NUCLEAR WEAPONS: I WOULD CERTAINLY NOT DO FIRST STRIKE
    • *TRUMP: CLINTON DOESN'T HAVE THE LOOK, DOESN'T HAVE THE STAMINA
    • *TRUMP: `HILLARY HAS EXPERIENCE, BUT IT'S BAD EXPERIENCE'

    *  *  *

    The bottom line.

     

    So, as Obama would say after his first unfortunate debate in 2012, on to the rematch.

  • "Foot-In-Mouth" Trump Vs. "Frog-In-Throat" Clinton: First Presidential Debate Begins – Live Feed

    The day has finally arrived. The two most disliked presidential candidates in the history of America face off mano a (wo)mano in a 90-minute, pee-break-barred grudge match of the politically-correct corrupt establishmentarian against the deplorable status-quo-wrecker. With the polls tied up, there's everything to play for as a record audience tunes in to see who will screw up first

    Anything could happen…

     

    With race almost perfectly tied up in the polls, as we detailed earlier, there is everything to play for, and as The Hill details, here are five things to watch for in the heavyweight clash that will set the course for the final 42 days of the election…

    Will Trump bring up _______?

    During the GOP primary debates, Trump veered from controversial and blustering to subdued and cordial. On the campaign trail, he’s shifted away from free-wheeling stream-of-consciousness rallies to reading from prepared text, but sometimes the teleprompter is not enough to keep him on message. The Clinton camp is preparing for everything but is undoubtedly unnerved by the prospect of Trump conjuring one of the countless real and imagined conspiracies or controversies from Clinton’s decades in public life. Trump could make Clinton’s marriage an issue by bringing up Monica Lewinsky, Paula Jones, Juanita Broaddrick or Kathleen Willey, or he could bring up Clinton’s health, just weeks after a passerby captured dramatic cellphone video of her appearing to pass out while leaving a 9/11 memorial in New York City. He could also veer into conspiracy. Trump during the GOP primary suggested rival Ted Cruz’s father might have been involved in the assassination of President John F. Kennedy. The GOP nominee has huddled with controversial anti-Clinton author Ed Klein, whose work has been dismissed by the mainstream political class as unsubstantiated conspiracy-mongering. And he has surrounded himself with conservative media giants like former Fox News chief Roger Ailes and Breitbart chairman Steve Bannon, both known for gleefully trafficking in the most embarrassing aspects of Clinton’s private life. It all has the potential to blow Clinton off course. Or it could backfire spectacularly on Trump and provide an election-defining moment of authenticity for Clinton. The Democrat will also have ample opportunities to get under Trump’s skin. A New York Times report said Clinton wants to show him unhinged, which could signal she intends to dig at her rival over his business accomplishments, temperament, past controversies with women or ties to right-wing extremist elements.

     

    Body language

    Every move, subconscious twitch and unplanned reaction will be captured in high definition, magnified before a Super Bowl-sized audience and endlessly dissected on cable news. Minor physical faux pas have sunk candidates in the past, from Al Gore sighing in 2000 to George H.W. Bush checking his watch in 1992. Trump has a flashy and over-the-top style punctuated by unique hand gesticulations and facial expressions. He is entertaining to watch and is a ratings juggernaut but is also in the position of having to prove to a skeptical public that he is commander in chief material — not just a showman. Clinton, meanwhile, is a cool and accomplished debater but can come across as dull or dispassionate. The Democratic nominee badly needs to energize a liberal base that has shown indifference to her. She’ll be looking to avoid a performance that appears overly scripted or sterile under the bright lights.

     

    The moderator

    Lester Holt, the modest and understated anchor of "NBC Nightly News," need only ask his colleague Matt Lauer, the host of NBC’s "Today," how tricky moderating a presidential forum can be. Lauer has suffered immense blowback from critics who said he was unprepared and allowed Trump to walk all over him at a military forum earlier this month. Holt will face intense scrutiny for the questions he asks, how he frames those questions, and whether he fact-checks and challenges the candidates on their claims. In 2012, CNN anchor Candy Crowley came under fire for correcting Mitt Romney — wrongly, according to conservatives — at a key moment in a debate against President Obama over a question about Benghazi. There are myriad controversies and scandals involving both candidates that Holt could choose to raise. Partisans will be keeping tally. The campaigns and candidates are already busy working the ref. Trump this week said Holt is a Democrat and warned the anchor not to fact-check his assertions. The Clinton campaign is publicly fretting that Holt has such low expectations for Trump that the moderator will take it easy on the GOP nominee while holding Clinton to a higher standard.

     

    What voters do Trump and Clinton speak to?

    Both candidates have work to do in shoring up their respective bases, but both also need to expand their appeal. Clinton has big leads over Trump among Hispanics, African-Americans and young voters. But none of these groups that formed the core of the Obama coalition are particularly enthused about turning out for her. She could lay it on thick with a message that energizes that liberal core, which could help her slam the door shut on Trump. But Clinton could also be looking to expand her appeal to Republicans who can’t bring themselves to vote for Trump. That would mean casting herself as a centrist and a pragmatist, rather than a fierce advocate for the causes important to the left. Trump, meanwhile, badly needs to resonate with some constituency outside his core base of white men. His efforts to reach African-American voters have been mocked as condescending and trafficking in stereotypes. Many minority voters and young people aren’t considering voting for Trump, but if he can improve even slightly on his dismal numbers there it could be meaningful for him in the long-run. A focus on minority outreach might also help alleviate the fears of white, college-educated voters who are steering clear of Trump because they don’t want to be associated with a candidate who has been accused of racism and bigotry.

     

    The debate over black and blue

    A police shooting of a black man under disputed circumstances in North Carolina has the nation on edge. The fatal shooting of Keith Lamont Scott has sparked protests in Charlotte and once again put the spotlight on police practices in black communities. Potentially furthering the tension — Monday’s debate is expected to attract upwards of 10,000 protesters and will take place on Long Island, which has a high concentration of cops, firefighters and first responders. Trump has broken recently from his hard-line pro-police stance, saying he was “troubled” by a different police shooting of a black man in Tulsa, Okla., which has led to charges of manslaughter against the officer. Tensions are running hot on both ends of the debate, and how the candidates handle the super-charged political minefield will be revealing.

    With some big money bets going down in the last few days on Trump's victory

    We suspect tonight's battle royale will do much to solidify the nation's choice.

    *  *  *

    Live Feed:

    *  *  *

    Perhaps more crucially for many watching tonight's debate, is the opportunity to drink (responsibly at first)

    Beginner's Drinking Game…

    h/t @chgirl

    Professional's Drinking Game… (only attempt if you have attempted at least one debate drinking game)

    Simplified… Pick A Candidate, Listen for words; If any candidate says a Community word, everyone drinks…

    h/t DebateDrinking.com

    And Keeping Score…

    And for the non-drinkers… How about some Bingo:

  • "America Is On Our Side": Al-Nusra Commander Tells German Press US Is Arming Jihadists

    In a striking interview with German journalist Jürgen Todenhöfer published today the German press including the prominent newspaper Focus, a militant jihadist commander said that US weapons are being delivered to Jabhat Al-Nusra by governments that Washington supports, adding that American instructors were in Syria to teach how to use the new equipment.

    “Yes, the US supports the opposition [in Syria], but not directly. They support the countries that support us. But we are not yet satisfied with this support,” Jabhat al-Nusra unit commander Abu Al Ezz said in an interview with Koelner Stadt-Anzeiger newspaper from the city of Aleppo. According to the commander, the militants should be receiving more “sophisticated weapons” from their backers to succeed against the Syrian government.

     

    For those pressed for time, below is a summary of what the Al-Nusra commander said:

    • They are directly supported by the US
    • They received tanks and other heavy weaponry via Libya and Turkey
    • They got officers and experts from the US, Israel, Turkey inside Aleppo
    • The commanders of IS are led by Western intelligence
    • They are against cease-fires and aid deliveries
    • “The U.S. is on our side”

    In the full interview, the commander notes that “The fight is difficult. The regime is strong and gets support from Russia,” the jihadist explained. Al Ezz said that Jabhat Al-Nusra “won battles thanks to TOW rockets. Due to these rockets, we reached a balance with the regime. Our tanks came from Libya via Turkey, joined by the [BM-21] multiple rocket launchers,” he said. 

    “We will fight until the regime is toppled,” he said, referring to Assad’s government. Al-Nusra Front wants “to establish an Islamic state that will be ruled according to the Sharia law. We do not recognize any secular state.”

    The government forces have an advantage because of aircraft and missile launchers, but “we have the American-made TOW missiles, and the situation in some areas is under control,” Al Ezz added.

    But the most stunning admission came when asked if the TOW missiles were initially intended for Jabhat Al-Nusra or if the group obtained them from the moderate Free Syrian Army, the jihadist clarified: “No, the missiles were given to us directly.”

     He also said that when Jabhat Al-Nusra was “besieged, we had officers from Turkey, Qatar, Saudi Arabia, Israel and America here… Experts in the use of satellites, rockets, reconnaissance and thermal security cameras.”

    Another dramatic admission: when Todenhöfer asked specifically if the US instructors were really present among the jihadists’ ranks and Al Ezz replied: “The Americans are on our side.”

    He also said that Jabhat Al-Nusra has been paid for achieving specific military goals during the Syrian conflict. “We got 500 million Syrian pounds (around $2.3 million) from Saudi Arabia. To capture the Infantry School in Al Muslimiya years ago we received 1.5 million Kuwaiti dinars (around $500,000) and Saudi Arabia’s $5 million,” Al Ezz said.

    The money came from the “governments” of those states, not private individuals, he said.

    One of the governments cited as a source of funds – Israel. “Israel is now giving us support because Israel is at war with Syria and with Hezbollah,” Al Ezz said. The West also “paved the way” for jihadists coming to Syria, saying that “we have many fighters from Germany, France, Britain, America, from all the Western countries,” the commander said.

    In the interview, Al Ezz confirmed claims made by Moscow and the Syrian government that the militants had used the Syrian ceasefire, agreed by Russia and US on September 9, to prepare for a new offensive.

    “We do not recognize the ceasefire. We will regroup our groups. We will carry out the next overwhelming attack against the regime in a few days. We have regrouped our forces in all provinces, including Homs, Aleppo, Idlib and Hama,” Al Ezz said.

    He said that Jabhat Al-Nusa would not let trucks with humanitarian aid enter Aleppo “as long as the regime [forces] are along the Castello Road, in Al Malah and in the northern regions.” “The regime must withdraw from all the territories, and we will let the trucks in. If a truck is going in anyway, we will detain the driver,” he said.

    The idea of a transitional government in Syria is also not supported by Jabhat Al-Nusra, the commander said. “We accept no one from the Assad regime or of the Free Syrian Army, which is described as moderate. Our goal is to overthrow the regime, and establish an Islamic state in accordance with the Islamic Sharia,” he said.

    As for the people who represent the Syrian opposition at the Geneva talks, Al Ezz said that “these people are weak, they’ve got a lot of money. They’ve sold themselves.”

    “There are mercenaries in Syria, Alloush fights with Al Nusra-Front,” he said talking about Mohammed Alloush, a leader in the Jaysh al-Islam group, part of the Syrian opposition’s High Negotiations Committee (HNC) in the peace talks. “The group that was housed in Turkey and which was turned into the Free Syrian Army, used to be part of Al Nusra-Front.”

    Interestingly, the al-Nusra Front commander also mentioned the UN aid convoy. Keep in mind that Todenhöfer, the first Western journalist to be granted access to the caliphate, conducted the interview ten day ago, before the attack. The commander said that the militants would not allow UN trucks carrying aid to enter Aleppo if the Syrian Arab Army does not withdraw “as required.” “The regime must withdraw from all areas in order for us to let the trucks in. If a truck drives in anyway, we will arrest the driver,” he detailed.

    Finally, in case there is still any confusion, the commander openly confirmed that Jabhat Al-Nusra “are part of Al Qaeda.”

    “Actually, we were inside one group together with the Islamic State. But the Islamic State has been used in accordance with the interests and political purposes of the big powers like America, and the group has drifted away from our principles. Most of the IS leaders are working with intelligence services, and it’s now clear for us. We, the Jabhat Al-Nusra, have our own way,” Al Ezz said.

    The interview with Jabhat al-Nusra’s commander was taken at a stone quarry in Aleppo on September 17 by Koelner Stadt-Anzeiger journalist Jurgen Todenhöfer on his seventh trip to war-torn Syria.

  • P2P Meltdown Continues: LoanDepot's CDO Collapses Just 10 Months After Issuance

    We first noted Wall Street’s misguided plan to feed its securitization machine with peer-to-peer (P2P) loans back in May 2015 (see “What Bubble? Wall Street To Turn P2P Loans Into CDOs“).  Obviously we warned then that the voracious demand for P2P loans was a direct product of central bank policies that had sent investors searching far and wide for yield leaving them so desperate they were willing to gamble on the payment streams generated by loans made on peer-to-peer platforms.

    In addition to the pure lunacy of using unsecured, low/no-doc, micro-loans as collateral for a CDO, we pointed out that the very nature of P2P loans meant that borrower creditworthiness likely deteriorated as soon as loans were issued.  The credit deterioration stemmed from the fact that many borrowers were simply using P2P loan proceeds to repay higher-interest credit card debt.  That said, after paying off that credit card, many people simply proceeded to max it out again leaving them with twice the original amount of debt.

    And, sure enough, it only took about a year before the first signs started to emerge that the P2P lending bubble was bursting.  The first such sign came in May 2016 when Lending Club’s stock collapsed 25% in a single day after reporting that their write-off rates were trending at 7%-8% or roughly double the forecasted rate (we wrote about it here “P2P Bubble Bursts? LendingClub Stock Plummets 25% After CEO Resigns On Internal Loan Review“). 

    Now, signs are starting to emerge that Lending Club isn’t the only P2P lender with deteriorating credit metrics.  As Bloomberg points out, less than year after wall street launched the P2P CDO, one of the first such securities backed by loans from LoanDepot has already experienced such high default and delinquency rates that cash flow triggers have been tripped cutting off cash flow to the lowest-rating tranches. 

    The $140mm private security, called MPLT 2014-LD1, was issued by Jefferies in November 2015 and, less than 1 year after it’s issuance, cumulative losses rose to 4.97% in September, breaching the 4.9% “trigger” for the structure.  And sure enough, the deal was sold to a group of investors that included life insurance company, Catholic Order of Foresters.

    But, as Bloomberg noted, the LoanDepot deal wasn’t the only one to breach covenants in less than a year.  Two other Jefferies securitizations backed by loans made by the online startups CircleBack Lending and OnDeck Capital have also breached triggers.

    For some reason the following clip from the “Big Short” comes to mind…“short everything that guy has touched.”

  • Wells Fargo Or The Fed: Who's The Bigger Fraud?

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

    The Wells Fargo bank account scandal took center stage in the news last week and in all likelihood will continue to make headlines for many weeks to come. What Wells Fargo employees did in opening bank accounts without customers' authorization was obviously wrong, but in true Washington fashion the scandal is being used to deflect attention away from larger, more enduring, and more important scandals.

    What Wells Fargo employees who opened these accounts engaged in was nothing more than fraud and theft, and they should be punished accordingly. But how much larger is the fraud perpetrated by the Federal Reserve System and why does the Fed continue to go unpunished?

    For over 100 years the Federal Reserve System has been devaluing the dollar, siphoning money from the wallets of savers into the pockets of debtors. Where is the outrage? Where are the hearings? Why isn’t Congress up in arms about the Fed’s malfeasance?

    It reminds me of the story of the pirate confronting Alexander the Great. When accused by Alexander of piracy, he replies “Because I do it with a small boat, I am called a pirate and a thief. You, with a great navy, molest the world and are called an emperor.”

    Over two thousand years later, not much has changed. Wells Fargo will face more scrutiny and perhaps more punishment. There will undoubtedly be more calls for stricter regulation, notwithstanding the fact that regulators failed to detect this fraud, just as they have failed to detect every fraud and financial crisis in history. And who will suffer? Why, the average account-holder of course.

    Any penalties assessed against Wells Fargo will be made up by increasing fees on account-holders. Clawbacks of bonuses, if they occur, will likely face resistance from the beneficiaries of those bonuses, leading to protracted and costly lawsuits. Even if the Wells Fargo CEO and top executives of Wells Fargo step down, the culture at Wells Fargo is unlikely to change anytime soon. As one of the largest banks in the world, Wells Fargo knows that it is not only too big to fail, but also too big to prosecute. At the end of the day, no matter how much public posturing there is, Wells Fargo and the regulators will remain best buddies. And those regulators who failed to catch this fraud will be rewarded with more power and larger budgets, courtesy of the US taxpayer.

    Through all of this, the Federal Reserve will continue its policy of low interest rates and easy money. Retirees who hoped to be able to live off the interest on their investments will find themselves squeezed by continued low interest rates. Those living on fixed incomes will see their monthly checks buying less and less as the prices of food staples continue to rise. The fat cats on Wall Street will continue to have access to cheap and easy money while those on Main Street will face a constantly declining quality of life.

    It is well past time for the Federal Reserve to face the same music as Wells Fargo and the bad actors on Wall Street. It is, after all, the Federal Reserve's creation of money out of thin air that enables all of this fraudulent behavior in the first place, so why should the Fed remain untouchable? Let's hope that someday Congress wakes up, hauls the Federal Reserve in for questioning, and puts as much pressure on the Fed as it does on private sector fraudsters.

  • Hofstra University Unveils "Trigger Warning" For Tonight's Debate

    It was inevitable. With much of the debate over the past year focusing on Social Justice Warriors, “safe spaces”, and – most notably – “trigger warnings,” moments ago the first such caution emerged when Hofstra University- the venue of tonight’s historic debate – posted a “trigger warning” sign to warn students about the potentially disturbing content that may be discussed during Monday night’s presidential debate.

    According to CBS New York reporter Tony Aiello, a sign inside of the student center at Hofstra reads, “Trigger warning: The event conducted just beyond this sign may contain triggering and/or sensitive material. Sexual violence, sexual assault, and abuse are some topics mentioned within this event. If you feel triggered, please know there are resources to help you.”

    As MrcTV adds, the sign provides students with contact information for student counseling services, the Title IX coordinator, student advocacy and prevention, and the national sexual assault hotline

  • The QE Premium

    Authored by Michael Lebowitz via 720Global.com,

    It has been eight years since the great financial crisis of 2008, and the Federal Reserve (Fed) is still maintaining an unprecedented level of accommodation in monetary policy. The Federal Funds rate has been pinned at or near zero since 2008. Recent discussions on raising the rate a mere quarter of a percent are met with a palpable level of angst and incredulity by economists and investors alike. Since the crisis, the Fed quadrupled their balance sheet using printed money to buy U.S. Treasury and mortgage securities. The economic results, supposedly the justification for these aggressive actions, have mostly been disappointing. That said, one can credit Fed policy actions for driving financial asset valuations to historic levels.

    Over the last eight years investors have adopted a mindset that Fed intervention is good for asset prices, despite clear evidence that it has contributed little to the fundamental rationale for owning such assets.  Fixed income yields are at or near record lows and stock indices trade at valuations that have only been eclipsed twice in history, just prior to the great depression (1929) and at the height of the technology bubble (2000). High end real-estate and various collectibles trade at unparalleled levels. The eye-popping valuations on these less liquid assets further confirm how impactful Fed policy has been on asset prices.

    We have written numerous articles highlighting rich valuations and the infectious behavior that can compel investors to make investment decisions that they would not otherwise make.  In this article we employ a cash flow model to quantify the potential ramifications on the equity market. The goal is to provide investors with a simple tool to calculate total return outcomes that could occur if investors were to lose confidence in the Fed and as a result stretched market valuation premiums built up since 2008 diminish or vanish altogether.

     

    P/E Ratio

    The 720 Global cash flow model was built to provide expected total returns associated with changes to the S&P 500 P/E ratio. For instance, if the P/E ratio were to increase to 30 or decrease to 15, what total return should an investor expect? The model uses the Shiller CAPE 10 ratio versus one-year trailing earnings as it provides earnings consistency by eliminating cyclical noise. The graph below offers a long term historical perspective on the wide range of monthly P/E ratios that have occurred since 1884.

     

    CAPE Ratio

    Data Courtesy: Shiller Data  http://www.econ.yale.edu/~shiller/data.htm

    The current P/E ratio of 26.57, denoted by the black dotted line, is approximately 60% above the average and has only been eclipsed by the exuberant periods of 1929 and 2000 and matched in 2007. Since the era of Fed activism began in the 1990’s, the ratio has tended to remain elevated relative to the historical average, despite what the recent quote from Janet Yellen would have us believe. “I would not say that asset valuations are out of line with historical norms.” – Federal Reserve Chairwoman Janet Yellen 9/21/2016

     

    P/E Shifts and Returns

    The graph below shows the output of the 720 Global cash flow model. Annualized percentage equity returns on the vertical axis (which includes price changes and dividends paid) are shown for correspondent P/E scenarios along the horizontal axis. The model assumes: 2.50% annual corporate earnings growth, 3.50% annual dividend growth and a three year term over which cash flows are modeled.

     

    Expected Annualized Returns

    Data Courtesy: 720 Global Cash Flow Model

     

    Hurdle Rate

    To use the graph to calculate the expected total return for a particular P/E ratio, locate the forecasted P/E ratio on the x-axis, follow it straight up to the total return black line, and read the corresponding figure on the y-axis. The green lines on the graph exhibit how a reversion from the current P/E ratio of 26.57 to a more historically normal P/E of 17.16, imply three consecutive years of –6.73% annualized returns.

    Under normal market conditions, investors appropriately require additional levels of return for added levels of risk. Historically, U.S. equities have exhibited approximately 2.5 times the risk (measured by standard deviation of prices) of U.S Treasury bonds. Fittingly, equites have rewarded investors with approximately 4.50% of additional annual returns over the long term. Measured using the Sharpe Ratio, the bond and stock markets have been very efficient over a long time horizon at assessing comparative risk between the two assets.

    Currently, 30-year U.S. Treasury bonds yield 2.35, thus equity investors mindful of history should have an investment hurdle rate, or a required annual rate of return of 6.85% (4.50% + 2.35%). Such an annualized return over time compensates them fairly for the additional risk of buying equities.

    The 720 Global model can be used to solve for the S&P 500 price that would allow an investor to meet their given hurdle rate or required rate of return for a given P/E ratio. The graph below charts these prices versus the associated P/E ratios for a hurdle rate of 6.85%.

     

    S&P 500 Hurdle Rates

    As shown with the green lines, an investor with the aforementioned 6.85% hurdle rate and expectations of P/E ratios decreasing only modestly from 26.57 to 20.00, should feel comfortable meeting their return requirement by purchasing the S&P 500 at any price below 1706.90.

     

    Data Courtesy: 720 Global Cash Flow Model

     

    Is the Past Prologue to the Future?

    The graphs above use conservative and relatively stable earnings and dividend assumptions. If the economy slides into a recession, not only may P/E ratios dip below the mean, but earnings and dividends growth may falter. The extent to which these measures adjust is often influenced by the extremity of valuations.

    The following table highlights historical experiences that occurred the three other times that P/E ratios resided at or above current levels. The top half of the table displays the changes in the ten year average earnings growth, dividend growth and P/E ratios that occurred during the 1929, 2000 and 2008 market corrections. The bottom half of the table uses that data as its assumptions and forecasts how similar changes would affect total returns today.

     

    Summary

    Equity valuations are grossly dislocated from supporting fundamental data. Comparisons to historic norms, despite what Janet Yellen claims, are far from reality. Investors willing to study history and look at current data will come to the same conclusion. Those that do will also likely agree that the downside looms large as mean reversion is, after all, a powerful force in the markets.

    The purpose of this article is not to claim that the market will immediately correct. In fact, there are several reasons, however unsound, that valuations may indeed rise further. The point is to stress that the odds are not in your favor of that occurring. Any sort of regression to mean, or as frequently occurs below mean, will result in a sizeable market correction as shown. To reiterate this point, the graph below shows the range of returns associated with the various P/E ratios described earlier. Additionally, the bar chart backdrop illustrates the percentage of time the market traded at the corresponding P/E ratios. Based on this analysis, one should expect negative returns if P/E ratios revert to historical ranges.

     

    Expected Annualized Returns with Historical Distribution of P/E Ratio

    Data Courtesy: 720 Global Cash Flow Model

    The current economic recovery and equity bull market rank among the longest on record. Concurrently, domestic and global economic data are slowing markedly while U.S. corporate earnings are declining. Even more concerning, the Federal Reserve’s tool kit is sparse and their ability to continue to prop up the market appears limited. To be blunt, given the aforementioned fundamental risks and the poor risk/return skew, history is clearly not in favor of those who remain long equities banking on the Fed to continue to levitate valuations and prices with limited tools and faulty narratives.

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Today’s News 26th September 2016

  • "You're An Idiot & A Lunatic if You Question 'Safe Spaces' Or 'Microaggression'" – President Of Northwestern

    Submitted by Mark Glennon via WirePoints.com,

    Never mind that he’s talking about many who his university educated, including me. Any of you who question campus preoccupation with safe spaces, trigger warnings and microaggressions are idiots and lunatics. That’s what Northwestern University President Morton Schapiro told new students this past week in his welcoming address. Articles about his comments include those in CampusReform and The Daily Northwestern.

    “Look for safe spaces,” Schapiro told the freshman, and he pledged that “if you can’t find them, we will help you find them.” Regarding traumatic ideas, Schapiro says, “If they say that…you shouldn’t be warned to prepare yourself psychologically for that, that somehow that’s coddling, those people are lunatics.”

    Northwestern University President Morton Schapiro

    The hypocrisy is breathtaking. Words like “idiot” and “lunatic” are just the kind from which the safe space crowd thinks it should be protected.

    Contempt for stereotyping is also high among their pieties. Yet Schapiro told his students, “The people who decry safe spaces do it from their segregated housing places, from their jobs without diversity — they do it from their country clubs. It just drives me nuts.”

    But it’s the microaggression thing that’s most interesting. Those who deny their existence are “idiots,” Schapiro says.” They “cut you to the core” and aren’t easily forgotten.

    Seems to me that’s why they’re great. I like them. They piss you off. They force you to decide who you are and what you stand for.

    Daislyland. Safe from the horrors of “microagression.”

    Like that girl from Manhattan in the dorm at Northwestern who told me she could never see any reason to go to the south suburbs (where I am from). Or the union thug when I worked at Jewel who threatened me with retaliation for questioning the political contributions I was forced to make. Or the people in the Cook County Recorder of Deeds office who would shake you down to get a lien search done when I was a young lawyer. Or some of the comments and emails I get here.

    I bet everybody who reads this – anybody with motivation, that is, in whatever direction – has their own stories. That’s what gets you out of bed in the morning.

    It’s far worse for gays, blacks and certain others. I get that. No comparison. Nobody is defending slurs or bigotry against them. But Schapiro’s obsession with microaggressions extends to everybody, and “micro” just isn’t big enough to worry about.

    “If you want to play in the NFL, you gotta play hurt,” football guys say. That’s true everywhere in everything, grownups know.

    Except at universities like Northwestern has become under Morton Schapiro.

    *  *  *

    Schapiro has defended safe spaces before: In a Washington Post op-ed published in January, he wrote that “the best hope we have of creating an inclusive community is to first create spaces where members of each group feel safe.”

    So – to translate – the 'final' solution' to creating a community where we are all equal is to segregate everyone into like-minded groups who do not feel 'safe' in the broad community?

  • "I Think It’ll Be A Clown Show" – Why Tomorrow's Debate Is So Important

    Craig Bell, a 55-year-old software engineer from Columbus, Ohio, will be one of the 100 million estimated Americans set to tune in on Monday night at 9pm for the first debate between the Democratic and Republican presidential nominees.  As profiled by Bloomberg, what he sees will be as important as what he hears. “I don’t know how to say this nicely, but I just want to see which one can act more presidential and more trustworthy,’’ Bell said at a table outside North Market in downtown Columbus.

    Bell, and millions of “undecideds” like him, is why tomorrow’s debate has such huge significance:  according to a new Wall Street Journal/NBC News poll, 34% of registered voters think the three presidential debates would be extremely or quite important in helping them decide whom to support for president. About 11% of voters are considered “debate persuadables”—that is, they think the debates are important and are either third-party voters or only loosely committed to either major-party candidate.

    Slightly more Republicans than Democrats said the debates would be important to them, 37% to 31%. But voter groups that seem poised to pay the most attention include several that Hillary Clinton is counting on to win. Some 49% of Hispanics, 42% of African-Americans and 39% of voters under age 35 say that the debates will be extremely or quite important to them.

    The breakdown of the millions of Americans yet to decide who they will vote for is shown below (apologies to Gary Johnson fans: he will not make it tomorrow): 


    According to Bloomberg, interviews conducted in key precincts of Ohio and Pennsylvania as well as other battleground states found voters who said they’ve ruled out either Clinton or Trump but aren’t yet comfortable with the alternative. Some are considering a third party contender, such as Libertarian Gary Johnson or not voting at all for president. While they care about the issues, most say they’ve heard where the candidates stand and aren’t expecting any new ground to be broken when they meet Monday night at Hofstra University in New York for the first of three scheduled debates.

    Still, they may be persuaded, and that’s what the campaigns are betting on. Indeed, as the WSJ adds, the campaigns of Donald Trump and Hillary Clinton acknowledged the huge stakes of Monday’s televised presidential debate. “In many ways, with this debate coming up, we’re just starting,” said Robby Mook, Mrs. Clinton’s campaign manager, on ABC Sunday. Added Kellyanne Conway, Mr. Trump’s campaign manager, speaking on the same network: “This will be the first time Americans have seen Donald Trump and Hillary Clinton on the same stage, and they’re going to be able to make their choice based on what they see.”

    The risk, of course, is that the two most unpopular presidential candidates in history succeed in turning away even more potential voters.

    “I feel like they are both bad choices,” said Melissa Huber, a 39-year-old day-care provider in Oklahoma. “I’m hoping that through the debate one of them will come out as a preferred option.”

    Ms. Huber is thinking of supporting Mr. Johnson, but added that like the abovementioned Craig Bell, Trump could win her over in the debate if he was to “show a little decorum. Show that he can be presidential.”

    Arnitress Dowdy, 39, an African-American who hasn’t settled on a candidate and quoted by the WSJ, is inclined to support Mrs. Clinton and is hoping to hear her address issues of race and police violence in the wake of the unrest in Charlotte, N.C.

    “I’m not sure who is really well equipped; I just need to hear more,” said Ms. Dowdy, a mother of two in New York. “I know she has advocated for children. I want to know what she will do so things will calm down.”

    * * *

    The most likely outcome from tomorrow’s debates, however, is that those who have decided on either Trump or Hillary will not change their minds, while the truly undecided will remain undecided. Worse, their confusion may be exacerbated: in that vein, Bloomberg reports that some 74 percent of likely Colorado voters deemed Trump “risky,” to 59 percent for Clinton, and 62 percent said Trump was “scary,” versus 57 percent for Clinton.

    A bigger risk, this time for Hillary, is that in a rerun of the seminal 2000 debate between Dubya and Al Gore, she passes off as even more robotic than usual: while more than eight in ten Colorado Democrats described Clinton as “competent” and “responsible,” only about 40 percent said she was “exciting,” CBS News said. When the latter group were asked specifically why they didn’t find her so, the top answer was they had wanted Senator Bernie Sanders as the party nominee, followed closely by the response that Clinton is too close to politics as usual.

    Trump did well within his own party in Colorado, being seen as “inspiring” by 72 percent of Republicans. And many Republicans who described him as risky are voting for him nonetheless, the poll showed. Some 91 percent of Republicans felt Trump would change Washington and 86 percent said he can fix the economy.

    * * *

    For those who do hope to be persuaded, here are some clues during the debate for what kind of leader the candidates will be.

    Reece Pavlovich of Columbus, 23, who works in sales for the Columbus Blue Jackets, said whether the candidates try to answer questions directly or dodge them will help him decide.

    “It’s a small tell-tale sign, if you can’t answer this one simple question that was asked of you without diverting or trying to blame it on someone else,’’ he said. “I don’t think that you’re fit to make massive world decisions or political decisions that can impact millions or billions of people.’’

    Judy Thacker of Palmetto, Florida, 58, a laid-off cook who considers herself an independent, doesn’t like either Clinton or Trump. She wants to see how they interact with each other as a cue for how they would handle themselves on the international stage. “If you watch them speak with each other, that’s how they would speak with a foreign leader if they were in a tight situation and they were trying to work something out and things were getting really hot and heavy like they will be at the debate,’’ Thacker said.

    Stephanie Frederick-Weber, 38, who lives near Reno, Nevada, doesn’t think either candidate has articulated a broader vision for the U.S. beyond standard rhetoric and hopes the debate will be an opportunity to get more than prepared speeches and talking points. “The debates are kind of integral because they kind of catch them off guard a little bit,’’ she said.

    To all of the above, and millions like them who honestly hope to be swayed, good luck.

    The rest, however, will merely be watching tomorrow’s debate just for the shock and entertainment value. As Bloomberg concludes, some undecided voters are so fed up with the race and their choices, they doubt the debate will matter or don’t plan to watch it.

    “I think it’ll be a clown show, more than I’ll get a good bombshell out of it,’’ said Ryan Porter of Columbus, 29, a financial adviser. It will be up to Trump and Hillary to prove him wrong, and – in the process – win.

  • Bush vs Obama As Explained By Glenn Greenwald In One Tweet

    Glenn Greenwald perfectly sums up the farce that is the supposed “two-party” system that rules America in one tweet…

    Welcome to the oligarchy.

    Evildoers (New Republic.com)

     

    Besties (CNN.com)

  • Dr. Lisa Bardack’s Faustian Bargain

    Submitted by Jay Michaels via AmericanThinker.com,

    “Oh what tangled webs we weave, when we first practice to deceive.”  Sir Walter Scott

    When Dr. Lisa Bardack was asked to become Hillary Clinton’s personal physician in 2001, it had to have been a crowning moment in the career of the Mt. Kisco internist.  Dr. Bardack could have anticipated little downside.  She already had the responsibility — and legal obligation under HIPAA — to protect the privacy of her patient.  She and her staff would have to be especially scrupulous in the case of a senator with presidential ambitions, but this should not have posed a serious problem.

    Unfortunately, Hillary Clinton corrupts everyone who serves her.  And this year Bardack encountered difficulties she could not have foreseen in 2001:

    1.  Clinton developed serious medical issues.

     

    2.  The candidate was being videoed, not only during campaign stops, speeches, townhalls, and the rare press conference, but before and after events — by individuals with cell phones who were under no obligation to obey orders given to servile journalists to turn off their cameras.

     

    3.  The internet not only permitted the mass distribution of these videos and photos, but it enabled those who were curious to check Bardack’s reports against information available on reputable medical sites.  It also enabled skeptical physicians to share their doubts with hundreds of thousands of readers.

    In July 2015, the Clinton campaign asked Bardack to give the candidate a clean bill of health.  She was to disclose, selectively, some of her patient’s medical history.  But the letter was not widely analyzed until after the disturbing September 11 video by Zdenek Gazda, the Zapruder of 2016.  It was no longer possible to dismiss those asking questions about Hillary’s health as right-wing conspiracy theorists, and the campaign now requested a second letter from Dr. Bardack explaining the event.  The physician duly issued a report on September 14.  Now her real problems began.

    Let’s take a look at the two letters and some of questions doctors have asked about the diagnoses and treatment.

    I.  The letter of 12 July 2015

    Bardack’s summary revealed a couple of major health problems that had not been previously disclosed.  We had been told that Clinton suffered an elbow fracture in 2009 and a concussion in 2012.  The fact that a woman in her mid-60s would fall twice ought perhaps to have raised some red flags.  In particular, unless you’re being tackled or attacked, a concussion can usually be avoided by the body’s reflexes.  Arms are extended to break the fall.

    But now the public learned that some time in 2009 and in December 2012, the month of the concussion, Clinton had suffered blood clots.

    She already had a history of clotting.  Running for the Presidential nomination in the fall of 2007, Hillary gave an extended interview on her 60th birthday in which she disclosed that she’d had a life-threatening medical emergency in 1998.  The crisis had been kept a secret not only from the public, but from her staff, who were told she had a sprained ankle.  Clinton’s foot had swollen and she was in great pain.  A White House doctor told her to rush to Bethesda Naval Hospital, where the diagnosis of a blood clot was made.  "That was scary,” Hillary said, “because you have to treat it immediately — you don't want to take the risk that it will break lose and travel to your brain, or your heart or your lungs.  That was the most significant health scare I've ever had."  Clinton assured the reporter that she was no longer on blood thinners. This was probably the last time Hillary spoke candidly about her health.

    What Clinton had was a deep vein thrombosis, or venous thromboembolism (VTE).  The blood clot is usually in the leg, and in Hillary’s case, it was behind the right knee.

    Now Dr. Bardack revealed that Hillary had had two others.  The first, in 2009, was another VTE, but the second was still more serious.  It was a right transverse cerebral venous sinus thrombosis (CVST).  This is a clot in one of the two channels between layers of the dura, the membrane enclosing the brain, which receive blood and cerebrospinal fluid.  A clot here means that blood flow out of the brain is impeded, and there is the potential for a hemorrhage if there’s leakage into the cerebral tissues.  The Johns Hopkins Health Library refers to it as a rare form of stroke affecting only five in one million individuals.  It’s treated with anti-seizure medicines as well as anticoagulants, and the complications range from impaired speech, difficulty moving parts of the body, and vision problems to death.

    There were two problems in the 2015 letter relating to the clot:

    1)  Clinton, her physician wrote, “began anticoagulation therapy to dissolve the clot.”  But this is not something anticoagulants do.  Two of these drugs are mentioned by Bardack:  Lovenox, which was discontinued beuing administered to her in 1998, and Coumadin (warfarin). 

    Bristol-Myers-Squibb, its manufacturer, says explicitly that the medication doesn’t dissolve clots: 

    COUMADIN has no direct effect on an established thrombus, nor does it reverse ischemic tissue damage.

    Every doctor prescribing Coumadin knows this.  Because of patient expectations, all reputable medical sites, like the NIH’s PubMed, repeat the warning.

    There are thrombolytic (clot-dissolving) drugs, injected by catheter or infused through an i.v., but none are mentioned by Bardack.  In any case, the embolisms for which thrombolytic agents are indicated don’t correspond to Clinton’s, and these drugs are never referred to as anticoagulants.

    2.  A second problem comes with the duration of the symptoms.  Bardack says that these lasted for less than two months.  But according to Bill Clinton, his wife’s injury “required six months of very serious work to get over.”

    Of course it could be that the four addition months of symptoms were the result not of the concussion, but the CVST.  However, it would not be easy to differentiate these symptoms.  One is instinctively disinclined to take the former President’s word on anything, but there’d be no reason for him to exaggerate the length of time it took his wife to recover.

    In any case, what the public was told was an elbow fracture (Hillary sported a State Department sling) and a concussion (she was jokingly presented with a football helmet by her minions) coincided with problems much more ominous.

    3.  A third issue in the 2015 letter is Bardack’s final evaluation of her patient.  Twice she calls Clinton “a healthy female” and concludes that “she is in excellent physical condition and fit to serve as President of the United States.”

    While Bardack could hardly have been expected to write otherwise, the truth is that anyone who is on lifelong Coumadin is not in excellent physical condition.  As is well known, warfarin was developed as a rat poison, and increases significantly the risk of intercranial intracranial bleeding.   A recent ten-year study of 32,000 veterans found that nearly one-third developed intercranial intracranial bleeds while on warfarin.  The vets were over 75, but the high figure was still very disturbing, though probably not surprising to most physicians.

    Dr. Milton Wolf, a board-certified radiologist, writes, “Coumadin carries a substantial risk for patients, particularly those with fall risk. Spontaneous hemorrhage common, intracranial and elsewhere. I see it commonly, including life-threatening brain bleeds. Normal, healthy patients are NEVER, NEVER prescribed Coumadin.”  There are safer anticoagulants.  “Coumadin is typically given to those who can’t afford the newer drugs or reserved for cases that are refractory to the safer drugs.”  Wolf speculates that Clinton probably has a hypercoagulable blood disorder.  Coumadin would otherwise be given only to patients with chronic atrial fibrillation (like the vets) or with prosthetic heart valves, both of which can cause hypercoagulation.

    The interactions with warfarin are also sobering.  In addition to avoiding both NSAIDs and acetaminophen, users are advised not to use, or to use with caution, antibiotics, anti-fungal medications, anti-depressants, and seizure medication — carbamazepine (Carbatrol, Equetro, Tegretol), phenobarbital (Solfoton), and phenytoin (Dilantin).

    Whether or not Hillary has been put at risk by seizure medications, the whole world now knows about her propensity to fall.  The airplane and podium stumbles and her being helped up a short flight of steps had gone viral long before the 9/11 collapse.  And we know nothing about the falls that have occurred off-camera, except for the one that gave her a concussion.  Family friends have told Ed Klein these falls are frequent.  And head trauma is the number one concern for patients on Coumadin.

    4.  Still another disclosure in Bardack’s July 2015 letter raised eyebrows.  In addition to taking Coumadin for the rest of her life, Hillary will also be on Armour thyroid until she dies.  Unlike CVST, hypothyroidism, an underactive thyroid gland, is common.  In fact, the most frequently prescribed drug in the U.S. (though not the most lucrative) is Synthroid, synthetic levothyroidoxine, the major hormone the gland produces.

    Armour thyroid is an extract of desiccated pig’s thyroid.  The therapy dates to the 19th century, and the American Association of Clinical Endocrinologists recommends that it not be used.  But a case can be made for natural thyroid therapy, and one recent study found that more patients prefer it, though there was no difference in the control of symptoms.  These include memory problems and difficulty thinking clearly.  A physician who is one of the most vocal advocates of natural thyroid switched to a different brand of natural thyroid after Armour changed the tablet formula in 2009.

    II.  The letter of 14 September 2016

    1.  Bardack disclosed that Clinton was given a brain scan for an ear infection after she had “experienced significant improvement in her symptoms.”  The physician of a patient “in excellent health” would not normally order a CT scan for an ear infection that was being successfully treated by antibiotics and a myringotomy tube.  Bardack’s caution, however commendable, suggests she was worried about some underlying problem.

    2.  Bardack then discusses Hillary’s pneumonia.  When an upper respiratory infection persisted for a week after Clinton had been prescribed antibiotics and allergy medicine, Bardack, on Sept. 9, ordered “a non-contrast chest CT scan, including a CTA calcium score.”

    According to Dr. Wolf, a CTA (a CT angiogram) scan always requires a contrast.  On the other hand, a CT calcium score study must always be non-contrast, otherwise “the coronary calcifications would be masked by the contrast in the arteries.”  The radiologist concluded that “Hillary’s doctor just claimed Hillary got a perfect score on a test that does not exist.”

    It’s likely that Bardack misstated what she’d ordered — though one would think she would be extraordinarily careful in a letter that would be read by millions.  A coronary calcium scoring CT does not use contrast, while a CTA requires it. A simple thoracic CT, which is what Hillary must have received, may or may not be done with contrast.

    3.  Then there’s the finding from the scan:  “a small right middle-lobe pneumonia,” further described as “a mild non-contagious bacterial pneumonia.”

    Doctors immediately questioned this diagnosis.  There is no such thing as a non-contagious pneumonia, tweeted Dr. Wolf. How did Hillary pick it up?  What about all the reports  the campaign circulated about staffers who’d come down with pneumonia, including manager Robbie Mook?

    While bacterial pneumonia is not as contagious as viral pneumonia, there is no test to determine whether or not a patient is contagious.  A doctor defending Bardack listed three types of bacterial pneumonia not likely to be contagious.  The only one that Hillary could possibly have had was aspiration pneumonia.

    The dubious adjective “non-contagious” may have been dictated to Bardack by Clinton.  The problem, obviously, was that after her collapse, the candidate went directly to her daughter’s apartment, where she presumably exposed her grandchildren to pneumonia, then, 90 minutes later, bounced out of the building, exulting that it was a beautiful day in New York, and embraced a little girl, exposing her, too, to the infection.

    Other doctors have also pointed out how the photo-op undercut the “pneumonia” explanation.  “I’m feeling great,” Hillary said three times, not something a pneumonia patient is likely to exclaim.

    4.  Apart from a case of “mild non-contagious pneumonia,” what felled Clinton on September 11th, wrote Bardack, was that “she became overheated and dehydrated.”  Even MSM reporters questioned the “overheated” pretext.  The day was partly cloudy and the temperature about 80, with a slight breeze.  Dehydration is hardly less suspicious.  First of all, it’s been used repeatedly for other falls.  And medical science has come up with a cure for dehydration.  While Marco Rubio was ridiculed for taking a swig of water in the middle his reply to the President’s 2013 State of the Union address, no one who valued his job would criticize Hillary for “re-hydrating” during an event.  One would expect that someone who had experienced multiple falls and was on Coumadin would take every precaution to avoid dehydration — especially when it’s such a simple matter.

    5.  If Hillary’s dramatic recovery casts doubt on Bardack’s diagnosis, so does the fall itself.  It was not a swoon, as one might expect, where Clinton appeared woozy, lost consciousness, and her knees buckled.  Instead, she becomes stiff and immobile.  She is propped up against a bollard.  It’s only when the Secret Service agents attempt to propel her forward that she falls.  It’s not clear she’s lost conscious; she is just frozen, unable to move.

    6.  Pictures taken of Clinton en route to the van also undermine Bardack’s explanation.  In one, Hillary is being given what appears to be a finger squeeze test.

    The test is a neurological exam, sometimes used also as a test for arthritis.  There would be no reason to administer it to a patient suffering from pneumonia.

    In the second photo, the same woman, Christine Falvo, appears to be monitoring Clinton’s pulse as they walk.  Hillary has her other hand pressed against her chest, an unusual position for someone in motion, but a good way to disguise the pill-rolling tremor associated with Parkinson’s disease.

    Also present in the photos, inevitably, is the bulky African-American Secret Service agent who clearly has had some medical training.  When Hillary froze during a speech on August 4, it was he who rushed to her side, put his hand on her back, kept repeating, “Keep talking, keep talking,” and then shooed away the other agents.  Some sites have posted pictures of him holding what appears to be a diazepam injector, used for seizures, but the images are too blurry to positively identify the object.

    There is no photo of either the Secret Service medic or Falvo offering the dehydrated Hillary a bottle of water.

    7.  Bardack’s 2015 letter mentioned the Fresnel prism glasses Hillary wore to eliminate double vision.  The 2016 letter makes no mention of the Zeiss Z1 blue lenses she was wearing on September 11th.  These are used to help prevent seizures, particularly in photosensitive epilepsy, and improve motor control.  They are not normally prescribed for patients with pneumonia or seasonal allergies.

    8.  Also unmentioned by Bardack are Hillary’s repeated coughing episodes, going back at least to January of this year.  Here’s video of eight.  Has Clinton had pneumonia for nine months?  Or is this a symptom of a neurodegenerative problem causing pulmonary aspiration?

    9.  Finally, the fact that Hillary was not rushed to a hospital after the collapse and given another CT suggests that her handlers knew exactly what was going on.  And it wasn’t pneumonia.

    The physician who has put forward the most plausible case that Hillary is suffering from Parkinson’s disease is Dr. Ted Noel, whose videos I linked in a recent blog post.

    Though there’s been no sign so far of the pill-rolling tremor or the shuffling gait characteristic of Parkinson’s, other evidence suggests Clinton is suffering from the disease, or experiencing side effects associated with the drug most commonly used to manage it, levodopa, which include disorientation and confusion and dyskinesia (involuntary muscle movements).

    Examples of the latter are Clinton’s spasmodic head movements while being questioned by several reporters (attributed by Hillary to her cold chai tea) and, less dramatically, her response to the light show at the end of the Democratic convention.

    Dr. Noel has a newer video out that further undercuts Bardack’s credibility.  In addition to mentioning Wolf’s point about CT angiography, he carefully describes problems with the oxygen saturation levels reported by Hillary’s physician, and her use of an outdated test to manage Clinton’s hypothyroidism.

    If she doesn’t have Parkinson’s, Hillary clearly has some major neurological disorder. 

    Bardack has already been targeted by Google reviewers.  Purportedly coming from Chelsea is a one-star rating and the comment, “My mother died of Parkinson’s after she was diagnosed with pneumonia.”

    Lisa Bardack will be fortunate if satiric reviews are the worst consequences for the disinformation campaign she has helped wage in Hillary’s behalf.

  • Edward Snowden Warns, Whatever You Do, Don't Use Google Allo

    Google Allo, the new “smart” chat app launched on Wednesday, is ‘dangerous’ and should be avoided, according to whistleblower Edward Snowden, because it will “record every message you ever send and make it available to police upon request.”

     

     

    As RT reports, Allo, designed to unseat chat pack leader WhatsApp, promises to deliver quick conversations with features like; “Smart Reply” that can guess your answers and respond to messages with just the tap of a button, and “Google Assistant”, which answers your questions and helps you search for things directly in your chat.

    How does Allo plan on predicting your every word and witty emoji, you ask? “The more you use it, the more it improves over time,” which basically means they’ll collect and store as much of your data as possible and then use artificial intelligence to guess your replies.

    However, the efficiency of time-saving typing may end up costing customers their already compromised privacy.

    When Google first announced the introduction of Allo earlier this year they, too, had planned end-to-end-encryption in “Incognito Mode” and assured they would only store messages transiently, rather than indefinitely.

    However,  it now appears that Google won’t be doing that after all. Wednesday’s announcement revealed Google plans to store all conversations that aren’t specifically started in “incognito mode” by default.

    As Snowden pointed out, last year every single one of the NSA and FBI’s 1,457 surveillance requests was granted by the US foreign intelligence surveillance court… and Allo’s stored data (i.e. your data) will be fair game too.

    In contrast, all of WhatsApp’s chats are encrypted and unreadable – although they did announce last month that they will now be sharing your contacts and who you talk to with Facebook.

  • Trump vs Hillary: The Debate Of The Century… Gets Even Wilder

    There is nothing we can say to underscore the importance of tomorrow’s debate that can come close to Goldman’s characterization of what is about to be unleashed in just over 24 hours. As Goldman’s David Kostin puts it, the “upcoming debate ranks as the biggest match-up since the Mayweather/Pacquiao bout”…

    … adding that “the first US Presidential debate will take place on Monday, September 26 and viewership may approach Super Bowl proportions with an audience of perhaps 100 million.

    * * *

    And it may get even wilder.

    As we reported over the weekend, as Hillary Clinton and Donald Trump got ready to face off in the first – and perhaps most anticipated in US history – presidential debate, their campaigns were mired in a controversy over guests.  The candidates have been accused of using their debate invitations to get under their opponent’s skin — and appear to be trying to outdo each other with their potential guests.

    It started when billionaire Mark Cuban, formerly a supporter who then flipped and became an outspoken critic of Donald Trump, last week announced he had accepted an invitation from Clinton’s campaign to sit front-row at the debate on Monday night. In response, Trump threatened to bring Gennifer Flowers, a woman with whom former President Bill Clinton had an extramarital affair. The GOP nominee tweeted Saturday if “dopey Mark Cuban of failed Benefactor fame wants to sit in the front row, perhaps I will put Gennifer Flowers right alongside him.”

    As reported previously, Flowers was eager to accept the invitation: “Hi Donald. You know I’m in your corner and will definitely be at the debate,” she tweeted in response. Bill Clinton testified under oath in 1998, saying he had a sexual affair with Flowers.

    However, speculation that Hillary would be eyeballing his husband’s former mistress in the front row quickly died earlier today when members of Trump’s campaign on Sunday denied that Flowers was officially invited and said she will not attend. Trump’s VP candidate Mike Pence confirmed Flowers wouldn’t be at the debate, and said his running mate’s tweet was meant to mock Clinton for “trying to distract attention away from this moment in our national life where the American people are going to see a strong contrast” between both major party’s nominees.

    The Indiana governor criticized the Democratic nominee for extending an invitation to Cuban. “Hillary Clinton apparently thinks this is an episode of ‘Shark Tank,’ but this is America,” Pence said on “Fox News Sunday,” referring to the ABC reality-business show Cuban has appeared on as an investor. 

    “It’s serious business” he added as we reported earlier, flipping the table on Hillary. 

    Trump’s campaign manager, Kellyanne Conway, echoed Pence’s comments, saying Flowers isn’t expected to be at the presidential debate as Trump’s guest. “Mr. Trump was putting them on notice that we could certainly invite guests that make it into the head of Hillary Clinton,” Conway said Sunday morning.

    Meanwhile, debate commission Co-Chairman Frank Fahrenkopf warned both major party’s nominees against using their invites to try to disrupt the debate.   

    “We’re going to frown upon — I will tell you this right now — whether or not a Republican or Democrat or anyone else attempts by use of the tickets in placing people in a front-row or not, to try to impact the debate,” he said Saturday on CNN. Then again, having guest “impact the debate” is precisely what America’s population appears to want, judging by the feverish response over the weekend to the tentative proposals to take the mudslining campaign between the two to an unprecedented level. 

    “It’s wrong. We would frown upon Mr. Cuban being in the front row if his purpose is to somehow disrupt the debate. Likewise, if Mr. Trump was going to put someone in the front row to try to impact things.”

    Quote by The Hill, Fahrenkopf said the debate commission has been working with the both campaigns’ staff and doesn’t expect any problems.  “They’re approaching this in a very dignified manner — the way I think it should be approached,” he said.

    That said, on Sunday, members of Clinton’s campaign defended the decision to invite Cuban to the debate, touting his accomplishments and denying it’s an attempt to annoy Trump. Clinton’s chief strategist, Joel Benenson, called Cuban a “successful businessman” whose economic beliefs often match Clinton’s. “I think it’s legitimate to have a businessperson sitting there who’s been advocating for you because of your economic policies,” Benenson said on “Fox News Sunday.”

    Meanwhile, whether Cuban is present or not, Conway, Trump’s campaign manager, praised the GOP nominee’s debate skills, calling him a “brilliant debater.”  “He’s like the Babe Ruth of debating. He really shows up and swings and does a great job,” she said Sunday on ABC’s “This Week.”

    Monday’s debate, moderated by NBC News’s Lester Holt, is expected to be the most watched ever, with an audience that could exceed 100 million people.

    An audience of that size would be something never seen before in U.S. politics.

    Which is also why most of the attention will be on Trump. The Republican presidential nominee has never debated another candidate one-on-one in his short political life. Trump has also never debated in such a quiet setting, the Hill adds.

    As the GOP primary debates sometimes resembled wrestling matches, with an audience applauding and booing loudly depending on what it heard, Trump – a consummate entertainer and TV personality – seized on many of those moments during the primary campaign to turn the tide.

    This time, however, it will be different: At Hofstra University in New York on Monday night, the crowd will be directed to not applaud, cheer or boo, and it will at times feel like two people and a moderator talking in front of a quiet theater audience. 

    How Trump handles this different setting remains to be seen, as experts say the primary debate format played right into his wheelhouse.  “The very crowded stage served him very well,” said David Birdsell, a debate expert and professor at Baruch College, of the primary debate.  “He was able to pick fights, land a quick one-off and then fade into the background, becoming a headline without a lengthy examination of his record and changing policy positions.”

    Trump’s most notable debate moments came not during a protracted back-and-forth on policy, but when he deployed quick one-liners that disarmed his rivals.  While some opponents, like Carly Fiorina at the start and Ted Cruz down the stretch, chose to attack him head on, Trump benefited when other candidates’ battles drew the spotlight, allowing him to pick his spots to strike hard and then retreat.

    Additionally, the events themselves will be significantly longer. Networks loaded up the two-hour primary debates with commercial breaks, giving candidates time to collect themselves as well as shortening the event.  But the general election debate will be a 90-minute commercial-free event, testing the concentration of the Trump in his first one-on-one debate. As the Hill points out, that could put Trump at a disadvantage, both as a candidate outmatched by his opponent’s policy grasp and with a penchant for controversial comments.  

    Trump’s debate prep appears to be less concerned about the former while looking to control the latter. Trump is reportedly taking a more hands-off approach with debate preparations, eschewing full-length test runs and deep-dives into briefing books, according to the New York Times. Aides even have expressed concern that Trump is downplaying the difficulties of staying on top of his game for the full 90 minutes.

     

    Instead, Trump, who once owned a United States Football League team, is scouring game tape, footage from old Clinton debates, in the hopes of finding weaknesses to exploit. 

     

    And his advisers are cautioning him to avoid falling into Clinton’s traps meant to frame him as unstable, and instead focus on hitting his campaign’s major themes.

    Then again, underestimating Trump has proven to be a failure in the past: those who took on Trump in the primary debates caution against taking him lightly—predictions that the Trump train would derail when the political novice took the debate stage fell flat. Frank Sadler, Carly Fiorina’s campaign manager during the primary race, believes it would be foolish to “underestimate Trump.”  “There’s this general thought that he can’t sit there for 90 minutes and answer policy questions in an effective manner,” he said.  “He’s been effective with the media since he came down that escalator. To think in the brand new format that he would be at a disadvantage, I don’t agree.”

    There is also Hillary’s health and stamina: following her recent health shocks, it remains to be seen if Hillary can muster anywhere close to 90 minutes of straight debate without breaks, something that Trump can surely use to his advnatage. 

    Furthermore, many critics point to Trump’s impulsive nature as potentially his undoing, as his campaign’s greatest missteps have come thanks to controversial comments made while deviating from message. But the potential weakness could also turn out to be a key asset.

    Those close to Clinton have told The Hill that she is preparing for “multiple Trumps,” an acknowledgement that they aren’t quite sure who will be standing across the stage from her.  “That’s the big unknown here, and it’s a case where it’s making her prep a little bit harder because she’s got to prepare for different versions of Trump—subdued Trump, aggressive Trump,” MSNBC’s Chuck Todd said Friday on “Andrea Mitchell Reports.”

    “The Trump campaign is enjoying this.”

    What Trump also has going for him are low expectations: his limited debate experience is perhaps the reason why the latest poll by Morning Consult has Trump losing with 29% of registered voters predicting a victory for Trump and 36% predicting Clinton will win. To be sure, Clinton communications director Jennifer Palmieri called low expectations “my biggest concern” during a chat with reporters in the days ahead of the debate on the campaign’s plane, according to ABC News.

    It is understandable: coming out of nowhere, and underestimated from day one, Trump is now in a “dead heat” with Hillary according even to the Washington Post.

    As The Hill concludes, multiple experts have compared the matchup to the 2000 debate, where a wonky Al Gore showed a mastery of policy but rubbed the audience the wrong way as he audibly sighed through George W. Bush’s answers. Bush emerged looking competent, compared to the expectations, and significantly more likable than Gore. And ultimately, he edged out the sitting vice president.  “You have a very similar contest here,” Birdsell said.

    “You have a candidate not expected to be able to talk about policy facing one expected to do an absolutely bang up job. The one who did an OK job could up being seen as the winner because he didn’t just flame out entirely.”

    * * *

    Oh, and Al Gore lost.

    Finally, here is a brief visual summary of the key historical moments in presidential debate history.

     


  • Smoking Hot Wives, Gold, And The Dollar (+ Other Good Stuff)

    By Chris at www.CapitalistExploits.at

    It’s been a while since I did a Q&A, and though I have a number of things I could discuss they will wait for another day for two very important reasons.

    Firstly, by doing a Q&A I can reply to questions which typically takes me a bit shorter than it does to write longer articles. This is important because it’s a Friday night and my wife is looking smoking hot…

    The second point. Oh, I forget what that was. Onto it then…

    “Hi,


    I just downloaded your US$ Bull Market Report from Dec. 2014.  It seems most of your predictions did not work out and the US$ has been in broadly a sideways to slightly up market since then.  The Yen is back to 100.


    Your entire thesis on the US$ Bull Market appears to be based on the notion that US interest rates will rise whilst interest rates everywhere else will stay low or fall or even go negative.


    Doesn’t your recent podcast on owning gold negate the US$ bull stance? With the FED having postponed its tightening cycle several time and the market now starting to doubt the FED will ever raise interest rates, does your stance from 2014 still stand?


     What is your stance on the USD/JPY? It seems the JPY is the new save haven currency which strengthens whenever there is a crisis. Do you still stand by your prediction that the JPY will weaken substantially against the USD?


    Where do you buy the currency options (especially USD/JPY) you refer to in your write-up? Could you kindly let me know which exchange they are traded on? (I have market access to all major exchanges).


     Kind Regards


    R.S”

    Let me break the questions down one by one.

    Dollar Index

    Not sure what charts you’re looking at but to get on the same page here is what we said on November 13, 2014:

    “A bull market in the US Dollar is underway and its magnitude and duration are likely to catch everyone by surprise. I believe it isn’t out of the question for the USD Index to advance by at least 50% within the next 5 years. If this forecast proves correct, there will be profound ramifications for the global economy and many financial markets, particularly emerging markets.”

    The Dollar Report was published a few weeks later so the thesis is the same. At the time it was trading at 86. And today we’re at 95. Didn’t we just catch the biggest move in the last decade?

    DXY Index

    We’ve been bumping and grinding for the last 12 months and we are forming a converging wedge which typically portends a break. I think we break higher. Maybe I’m wrong but that’s where the weight of probability lies for me right now.

    Remember, the dollar spent 10 straight years doing nothing but go down. To expect it to go up in a linear fashion is foolish. It’s not going to happen. Markets don’t work like that. They are non-linear.

    The dollar bull thesis is in part due to an interest rate differential – as you mention – but there is more to it than that. The USD carry trade unwinding is arguably a much bigger force behind a rising dollar than interest rate arbitrage.

    Then there is the fact that on a relative basis, especially politically, the US looks a whole lot less shaky than does Europe or Japan, where Kuroda-san continues on the path to destroy the yen. This is a ridiculously sad situation given that the two podium donuts on show in the US actually look less bad than the clutch of parasites at the helm in Europe. It is what it is.

    USD and Gold

    With regards to being dollar bullish as well as long-term gold bullish I believe we are likely to see both rising simultaneously.

    ————————————–

    Kyle Bass Gold

    ————————————–

    The factors driving the two asset classes are at this point in time working to strengthen both. For more on this you can listen to my discussion with Raoul Pal.

    Yen

    I guess this is not really fair if you’ve not been a long term reader as we put out a special Japan report in January 2012 saying we were shorting the yen. It was at 72. Twelve months later at 89, and hit a high of 125 before moving back to 100 today.

    For me this is a long term trade I’m happy to have on for the next decade. I actually think it’s possible we get back down to 95 before heading much higher. I’m not prepared to buy the yen in anticipation of that but if we get there I’ll be pressing the short trade. This is quite simply something that I think you can set and forget and not be too worried about short-term noise.

    Options on currencies are available via the Saxo platform. If you’re a US citizen then you’re a lepper to Saxo and they don’t want anything to do with you.

    Easy enough to get around by using an offshore (non-US) company to open an account. I don’t know of any other platform that offers options on currencies. Perhaps readers can comment below if they know of any.

    Next question:

    “Thanks for your fantastic blog – it is much appreciated. I would be very interested in your view on two points:


    1. China looks like a Ponzi scheme to me too. However in the tradition of searching for non-bias-confirming views, I come accross the argument that Chinese SOE debt is not as bad as it looks because savings are very high, those savings fund corporate loans, and therefore in China debt is often used as a substitute for raising capital in the equity markets. By this reasoning, a debt for equity swap could at a stroke hugely reduce the debt load. An example of this argument is here:

     

    https://www.project-syndicate.org/commentary/china-moving-from-debt-to-equity-by-andrew-sheng-and-xiao-geng-2016-05


    1. I have heard you talk about the frequency of six-sigma events in today’s markets. This may or may not be remarkable, but I think we have to exercise caution over this interpretation of a statistical measure. Standard deviations are only applicable to normally distributed events, and financial events are certainly very far from normally distributed. I think that the frequency of n-sigma events is just re-enforcing this fact, though of course their increase does point to a change in the climate. Do you agree with this?

     

    Thanks again,

     

    Matthew”

    China, a Ponzi Scheme?

    This argument has been used before. It’s a variation of “we owe it to ourselves so it doesn’t matter”.

    Let’s say you lent money to your cousin Joey who, instead of using using it to grow his business as promised, bought a Bentley (he clearly has terrible taste).

    Since you found that, after he failed to pay you back your money on time, he’s put some mileage on it, taken out an additional loan against the car to access some more cash, and dinged it parallel parking which we can’t really blame him for since it’s such a big ugly sucker. You’re family so it doesn’t matter?

    What about a debt for equity swap? You get the equity in his “ugly as sin” Bentley. But wait, it’s encumbered and when you net out the debt against the equity you realise the equity is close to worthless. Does it matter?

    Here’s the issue. Economists call it pushing on string:

    In 2015, total Chinese government debt increased by a CNY4.6 trillion, or about US$700 billion.

    Problem is, in 2004, one yuan in new debt generated 73 cents in additional GDP. By 2009, this was down to 33 cents. Today, the ratio is less than 1 to 4. You don’t need me to explain to you that when your debt is increasing four times faster than your income you’re heading fast towards the edge of a cliff.

    This is the real tragedy of central bank policy. By these bureaucrats’ warped logic, the fact that the increase in debt is no longer having the desired effect is used as evidence that in fact more debt is required. This lands up being a debt multiplier in that an ever increasing amount of debt is required to achieve the same level of growth. To the point that now we sit with central banks pushing NIRP down our collective throats.

    As I mentioned earlier this week, with the help of some birds to explain the situation, we now await blowback.

    Six Sigma Market Events

    The increase in frequency of such events is unmistakable but not unsurprising.

    It points to a period of time that is unlike the periods of time we’ve been experiencing: unchartered waters. Imbalances have consequences and greater imbalances beget greater consequences.

    Ergo, more 6 sigma events on the horizon.

    Onto the next one:

    “Hi Chris, 

     

    Thank you for continuing to post unique and insightful content on CapEx! Really invaluable insight. One topic I would like to pick your brain on, and which has been a topic of a few of your latest posts, is inflation:

     

    Over the past 8 years we had an incredible amount of asset price inflation due to QE/NIRP etc. as liquidity remained in the financial system. How likely is, in your opinion, that eventually this will be reflected into CPI/consumer goods?

     

    The potential scenarios I see:

     

    On one hand (Scenario 1 – Deflationary Bust) this asset inflation boom might end a-la ’08, as FED raises rates/dollar strengthens triggering a repricing of asset prices 

     

    On the other hand (Scenario 2 – Stagflation), the FED might stay put (after a small raise of benchmark rates) and fiscal policy on a worldwide scale is more accommodating; this will unleash a wave of wage/consumer goods inflation.

     

    I used to think that the most likely scenario was Deflationary Bust followed by even more aggressive QE/fiscal policy which in turn would lead to Stagflation. Now though I am more inclined to think that Scenario 2 is a real possibility (because of structural impossibility of raising rates significantly without triggering a crisis; additionally policy speeches seems to be shifting towards more fiscal easing as well lately). 

     

    What are your thoughts? And how should Scenario 2 be traded – short rates or short currencies? So far currencies have been the release valve, but are we going to assist to a paradigm shift whereby rates will have be forced upwards (by inflation expectations/market or as central banks catch up)? Apologies for the long e-mail.

     

    Thanks,

     

    M”

    Firstly, thanks for the kind words.

    Inflation Showing Up in CPI

    To your question on inflation showing up in CPI: you’re dead right. We’ve had asset inflation largely in financial assets to an extent that is truly frightening.

    Consider that 50 years ago in pretty much any developed country in the world a home was affordable with just one working parent, healthcare was affordable, college tuition could be saved and paid for by weekend and holiday jobs at the local supermarket checkout counter, and televisions and phones were luxury expensive items.

    Today everyone, including kids, has a smartphone, everyone has a TV that can’t be fitted through a doorway without gymnastics. And yet home ownership, especially for millennials, is a pipe dream, college tuition can no longer be paid for by summer jobs, and healthcare insurance requires you to sell your kidney to pay for it, which of course defeats the purpose.

    Many consumer goods, on the other hand, have been experiencing deflation though this is due to tech innovation and geographical labour cost arbitrage.

    I don’t know when inflation shows up in consumer goods.

    Obviously in a bond market rout and currency crisis then inflation typically takes hold in every asset class, including consumer goods. Given that I believe there is no more GDP to be juiced out of the global economy via credit fuelled policies (NIRP, ZIRP), I think it’s prudent to be looking at those asset classes which are in the “need to have” basket of consumer goods.

    For example I’m beginning to get pretty interested in the soft commodities. If you take a look at the charts alone it’s hard not to get a little excited.

    Regarding fiscal policy. As I mentioned recently when chatting with Erik Townsend, I think fiscal policy is the next big hit, certainly in the US.

    Should that bring even a whiff of inflation it could spell real trouble for what is now a bond market that is more sensitive to price movement than it’s ever been!

    Your question was how to trade. Rates or currencies? Both – they’re reflexively related.

    Next…

    “Hey Chris,  

     

    I’m a retired medical doctor and consider myself well read and well versed in world affairs. The first article I read of yours roughly 2 years ago really irked me. It angered me because at the time I was convinced the dollar was going to hell. I’d been reading a lot of material published by [omitted] and it was a constantly repeated theme. I felt like it was the only thing that mattered and I automatically rejected anything that contradicted what I wanted to believe. I was invested in emerging markets and foreign currencies as a result. I honestly don’t know what made me sign up for your free content as I recall thinking you were a complete idiot. Perhaps I simply was convinced you would be wrong and wanted to see your ideas proven for the garbage I was convinced they were.  

     

    It only took a few more articles since reading that first one, and as much as I was ready to hate you and see you proven wrong I found myself nodding my head and smiling at your ability to dispassionately see and explain what are very complex financial, social and political issues. I can tell you that over the course of time, I have a newfound understanding of our world, am certainly less dogmatic than I used to be, and your work together with Realvision TV which you introduced me to has played a significant part in that.  

     

    You Sir have yourself a dedicated reader.  

     

    If you would be so kind, (and I feel bad for asking for this since you’ve given me so much and I’ve given you an email address) you mentioned in an article a while back that the HK market was worth a look. I decided for the first time to act on your thoughts and bought the iShares MSCI Hong Kong ETF. I’m up over 10% and would love to know more on why you thought HK equities were a good bet.

     

    Deepest thanks

     

    AJ”

    Wow, thanks. I’m glad you no longer hate me. That’s a decent start.

    One quick comment and I know I’ve mentioned this before but it bears repeating. The market DOESN’T care what you or I think. It doesn’t care about opinions, it doesn’t care about who said what or how rich or famous they may be. Dogmatism in investing is lethal. Nobody knows all the answers. Certainly not I.

    Question everything and whenever someone is yelling and screaming that XYZ is absolutely going to happen it’s probably a sign to be cautious, especially if they’re selling something. I know a lot of incredibly smart, successful investors, and not one of them thinks they absolutely know what is going to happen. It’s all just probabilities and risk management.

    In any event, what you’re referring to was an issue of “World Out Of Whack” back in June:

    “While the focus today is on overvalued RE markets, as an investor I can’t help myself from pointing out that with a P/E ratio of just 9x, Hong Kong’s equity markets are today the cheapest in the world, with the Hang Seng Index trading at the biggest discount to global shares in 15 years.

     

    As a reference point consider that most major stock markets typically trade at a P/E of between 15-20x, so we’re looking at an equity market some 40-50% of its highs and an overvalued real estate market at the same time.”

    Here is the ETF you bought. We’re up about 14% this quarter:

    EWH ETF

    Cheaper valuations obviously, a stable currency pegged to the USD (for now at least), and the coming second exchange link with China seem to point towards more favourable setup for HK equities. Where would be the first place you’d go if you were a mainland Chinese looking to diversify out of China?

    That’s all for now and my apologies to all those who email me and who’s questions go unanswered. It’s not because I don’t love you too.

    Have an awesome weekend wherever you are. I’m going to go find that wife of mine…

    – Chris

    “My most brilliant achievement was my ability to be able to persuade my wife to marry me.” —  Winston Churchill

    ————————————–

    Liked this article? Don’t miss our future missives and podcasts, and

    get access to free subscriber-only content here.

    ————————————–

  • A Sunni Muslim Asks: Is "Radical Islam" The Problem Or Is "Islam" The Problem?

    Submitted by Michael Shedlock via MishTalk.com,

    In 2015, President Obama told CNN that 99.9 Percent of Muslims Reject Radical Islam. He made the comments in response to a question about the White House avoiding using the phrase “Islamic terrorists.”

    Hillary Clinton says “Let’s be clear: Islam is not our adversary. Muslims are peaceful and tolerant people and have nothing whatsoever to do with terrorism.”

    Are they correct?

    Obama Rejects Religious War

    “It’s absolutely true that I reject the notion that somehow that [Isis] creates a religious war”.

    Let’s Be Clear

    Breitbart provides this Hillary Islam Flashback.

    Clinton claimed that using the phrase “radical Islamic terrorism” to describe the previous radical Islamic terrorist attack in France — the Paris massacre, which occurred just a few days before she spoke — “gives these criminals, these murderers, more standing than they deserve, and it actually plays into their hands by alienating partners we need by our side.”

     

    “In the end it didn’t matter what kind of terrorist we called [Osama] bin Laden. It mattered that we killed bin Laden,” Clinton sniffed.

     

    By June, Clinton had grown uncomfortable enough with public perceptions of her terrorist-fighting credentials to assure a CNN audience that she was super-duper comfortable with saying the words “radical Islam.”

     

    “From my perspective, it matters what we do more than what we say. And it mattered we got bin Laden, not what name we called him. I have clearly said we – whether you call it radical jihadism or radical Islamism, I’m happy to say either. I think they mean the same thing,” she said, making a game effort to keep her we got bin Laden without calling him a jihadi talking point alive.

     

    However, when she made her desperate call to Bill O’Reilly after the Nice atrocity unfolded, she was suddenly uncomfortable with the “radical Islam” formulation again, going with “these radical jihadist groups” instead. Perhaps Mrs. Clinton could tell us about some moderate jihadist groups, for the purposes of comparison.

    A Sunni Muslim Chimes In

    Here’s a video that I would like you to play. The video is by a Sunni Muslim. It’s called By The Numbers – The Untold Story of Muslim Opinions & Demographics.

    By the Numbers is an honest and open discussion about Muslim opinions and demographics. Narrated by Raheel Raza, president of Muslims Facing Tomorrow, this short film is about the acceptance that radical Islam is a bigger problem than most politically correct governments and individuals are ready to admit. Is ISIS, the Islamic State, trying to penetrate the U.S. with the refugee influx? Are Muslims radicalized on U.S. soil? Are organizations such as CAIR, who purport to represent American Muslims accepting and liberal or radicalized with links to terror organizations.

     

    Question of the Month

     

    Fundamentally, it may be fair to ask “Is religion in general the problem?”

     

     

  • The Obama Gun "Super Owner" – New Study Finds 50% Of Guns Owned By Just 3% Of Population

    A recent Harvard study of the demographics of gun ownership in the United States yielded a fairly shocking discovery, namely the emergence of the Obama gun “Super Owner.”  The study, entitled “The Stock and Flow of US Firearms: Results from the 2015 National Firearms Survey“, was conducted by the Harvard School of Public Health and found that just 14% of all gun owners, or 7.6mm adults and 3% of the total U.S. population, possessed 50% of all guns owned by civilians in the country.  Moreover, with a total stock of 270mm civilian-owned guns in the U.S., that implies that these “super owners” possess an average of nearly 18 guns per person. 

    Gun owning respondents owned an average of 4.85 firearms (range: 1-140); the median gun owner reported owning approximately two guns. As can be seen in Figure 3, approximately half (48%) of gun owners report owning 1 or 2 guns, accounting for 14% of the total US gun stock, while those who own 10 or more guns (8% of all gun owners), own 39% of the gun stock. Put another way, one half of the gun stock (~130 million guns) is owned by approximately 86% of gun owners, while the other half is owned by 14% of gun owners (14% of gun owners equals 7.6 million adults, or 3% of the adult US population).

    Guns

     

    Another startling discovery in the data, though “oddly” not highlighted in the report, is that the surge in gun ownership per capita seemed to coincide with the start of the Obama presidency and growing rhetoric over new gun regulations.  Per the chart below, over the past 20 years, gun ownership per U.S. adult hovered around 1 from 1993 through 2007 but then surged starting in 2008 as an Obama presidency became increasingly likely.  

    Guns

     

    This trend is also reflected in annual guns sales which floated between 4-6mm units per year before surging in 2008.

    Guns

     

    And perhaps no one has benefited more than Smith and Wesson shareholders…

    Guns

     

    Meanwhile, the less surprising takeaway from the study was that conservative, veterans living in rural areas were the most likely people to own guns.  Shocking.

    Guns

     

    Guess that, like with military intervention, new gun regulations don’t really work that well if they’re advertised well in advance. 

     

    Full report:

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Today’s News 25th September 2016

  • Washington Mall Shooter Caught: Suspect Is 20 Year Old Turk

    Following last night’s shooting at the Cascade Mall in Burlington, WA mall, when an unidentified gunman killed 5 then managed to slip away from authorities for nearly 24 hours, moments ago the Washington State Patrol tweeted that the shooter has, after a daylong manhunt, been captured.

    The man was arrested without incident, and is in custody, said Sgt. Keith Leary, of the Washington State Patrol.

    Below is a photo of the arrest courtesy of Q13fox

    As reported early this morning, the suspect fled the Cascade Mall after the deadly shooting at Macy’s. The motive behind his shooting is still not yet known. 

    While the police previously described the mall shooter as Hispanic, according to unconfirmed reports – as the police still hasn’t released the suspect’s name – the identity of the shooter is Arcan Cetin, aged 20…

    …. who according to his Facebook profile is originally Turkish, from the city of Adana.

    Several photos of Cetin’s Myspace page were released on twitter, suggesting he had a fascination with weapons:

    Some more of his facebook pictures:

    And then there was this odd tweet from January 2015:

    … followed by this one from April, 2015

  • Bill Clinton's Ex-Girlfriend, Gennifer Flowers, Confirms She Will "Definitely Be At The Debate"

    Following Trump's earlier tweet, "If dopey Mark Cuban of failed Benefactor fame wants to sit in the front row, perhaps I will put Gennifer Flowers right alongside of him!"; Bill Clinton's old girlfriend confirmed she will indeed be attending the debates on Monday.

    In response to Hillary Clinton giving Mark Cuban front row seats at the debate, Trump tweeted:

    As a reminder, Bill Clinton testified under oath in 1998 that he had a sexual affair with Flowers.

    In his January 1998 deposition, the President, though finally confirming a sexual encounter with Ms. Flowers, was precise in denying Ms. Willey's report that he had sought to kiss her and feel her breasts in an encounter in his private dining room off the Oval Office.

    Trump said earlier this week that he did not plan to bring up the Clintons’ marriage at the debate.

    “I don’t think I’m looking to do that Bill. I don’t know what I’m going to do that exactly,” Trump said during an interview on “The O’Reilly Factor.” “It depends on what level she hits you with, if she’s fair, if it’s unfair, but certainly I’m not looking to do that.”

    That may have changed, however. To be sure, Saturday isn't the first time Trump has referenced Bill Clinton's infidelity. He brought the former president's sex scandals into the campaign late last year around the time Hillary Clinton announced her husband would join her on the campaign trail. At the time, she had recently accused Trump of having a "penchant for sexism" over his charge that she had been "schlonged" in the 2008 primary.

    "Hillary Clinton has announced that she is letting her husband out to campaign but HE'S DEMONSTRATED A PENCHANT FOR SEXISM, so inappropriate!" Trump tweeted in December. Trump later labeled Clinton "one of the great women abusers of all time."

    Sure enough, just to make Monday's debate even more memorable, moments ago Gennifer Flowers confirmed she will be at the debate.

    Grab your popcorn because the "best. election. ever" just got even better.

     

  • Charlotte Police Release Dashcam, Body-Cam Footage Of Keith Scott's Death, Chief Says "Absolutely" Had A Gun

    Update:  Charlotte police have just released the following bodycam footage of the event.

    Here is the dashcam footage…

     

     

    And additionally, the Charlotte Police released evidence images…

     

    *  *  *

    As we detailed earlier, having exclaimed "drop the gun" 11 times in the video of the fatal shooting of Keith Scott provided by his mother, Charlotte police have just stated in a press cobnference that they have agreed to release the body-cam video of the event. Despite earlier saying that it wouldn't release police video for fear of compromising its review, the State Bureau of Investigation has succumbed to public pressure despite a lack of "absolute, definitive, visual evidence" that Scott brandished a weapon at the officers.

    Keith Scott's mother's view of the event…

    OFFICER: Hands up!

    RAKEYIA SCOTT: Don’t shoot him. Don’t shoot him. He has no weapon. He has no weapon. Don’t shoot him.

    OFFICER: Don’t shoot. Drop the gun. Drop the fucking gun.

    RAKEYIA SCOTT: Don’t shoot him. Don’t shoot him.

    OFFICER: Drop the gun.

    RAKEYIA SCOTT: He didn’t do anything.

    OFFICER: Drop the gun. Drop the gun.

    RAKEYIA SCOTT: He doesn’t have a gun. He has a T.B.I. (Traumatic Brain Injury).

    OFFICER: Drop the gun.

    RAKEYIA SCOTT: He is not going to do anything to you guys.

    RAKEYIA SCOTT: He just took his medicine.

    OFFICER: Drop the gun. Let me get a fucking baton over here. [muffled]

    RAKEYIA SCOTT: Keith, don’t let them break the windows. Come on out the car.

    OFFICER: [muffled]

    OFFICER:Drop the gun.

    RAKEYIA SCOTT: Keith! Don’t you do it.

    OFFICER: Drop the gun.

    RAKEYIA SCOTT: Keith, get out the car. Keith! Keith! Don’t you do it! Don’t you do it! Keith!

    OFFICER: Drop the gun.

    RAKEYIA SCOTT:Keith! Keith! Keith! Don’t you do it! [SHOTS]

    RAKEYIA SCOTT: Fuck. Did you shoot him? Did you shoot him? Did you shoot him? He better not be fucking dead. He better not be fucking dead. I know that fucking much. I know that much. He better not be dead. I’m not going to come near you. I’m going to record, though. I’m not coming near you. I’m going to record, though. He better be alive because …I come You better be alive. How about that?Yes, we here, over here at 50 … 50 …9453 Lexington Court. These are the police officers that shot my husband, and he better live. He better live. Because he didn’t do nothing to them.

    OFFICER: Is everybody good? Are you good?

    RAKEYIA SCOTT: He good. Nobody … touch nobody, so they’re all good.

    OFFICER: You good?

    RAKEYIA SCOTT: I know he better live. I know he better live. How about that I’m not coming to you guys, but he’d better live. He better live. You all hear it, you see this, right? He better live.

    OFFICER: [muffled]

    RAKEYIA SCOTT: He better live. I swear, he better live. Yep, he better live. He better fucking live. He better live. Where is…He better fucking live, and I can’t even leave the damn…I ain’t going nowhere. I’m staying in the same damn spot. What the fuck. That’s O.K. did you all call the police? I mean, did you all call an ambulance?

     

    Some have argued that there was a gun seen…

    *  *  *

    Press Conference has concluded.

    The body-cam footage will be released by 1715ET.

    During the press conference, Charlotte police chief Putney said "Officers are absolutely not being charged by me, but again, there's another investigation ongoing." Putney said that Scott was "absolutely in possession of a handgun," and that officers also saw marijuana in his car — prompting officers to act.

    • There was a crime that Keith Scott had committed that led cops to him and "the gun exacerbated the encounter."
    • He can't assure Keith Scott's wife and 7 children that every effort was made to avoid deadly force.
    • Officers Are ‘Absolutely Not Being Charged By Me at This Point’
    • Keith Scott Had Marijuana and Gun, Prompting Police Encounter
    • "No single piece of evidence…proves all the complexities" of Keith Lamont Scott case
    • Police have said Scott was shot on Tuesday because he refused commands to drop a handgun. Residents have said he was unarmed. Putney says Scott "absolutely" had a gun but that it's not shown in his hand in the videos.

     

  • Here's How CIA Puppet-Masters Are Deliberately Picking A 'World War III Level' Fight

    Via DasiyLuther.com,

    It’s really quite embarrassing on a global scale when members of our own government seem to be deliberately trying to pick fights with people who aren’t interested in fighting with us. If you’ve traveled outside of the United States much, you probably know that we Americans have a rather negative reputation off of our own shores. Now, generally speaking, that isn’t our fault as individuals. You and I don’t create headlines that make waves throughout Europe and Asia.

    While average Americans aren’t directly responsible for this, our federal officials are. I’ve written recently about President Obama doing things in Syria that are worsening the conflict there. I’ve also written about the fact that he and Russian President Vladimir Putin are starting to butt heads. And finally, I’ve warned time and time again that war is upon us – and everyone knows but the US.

    Michael Morell is the director of the CIA. Here’s a little blurb from Wikipedia about him.

    Michael Joseph Morell (born September 4, 1958) is an American intelligence analyst. He served as the deputy director of the Central Intelligence Agency as well as its acting director twice, first in 2011 and then from 2012 to 2013. Since November 2013, he has been a Senior Counselor to Beacon Global Strategies LLC. He is a proponent of the CIA’s use of enhanced interrogation techniques which many consider to be torture, and is also a proponent of the CIA’s targeted killings by drones.

    Wow, and just think. He’s a guy that has almost unfettered power to call a hit on anyone in the world.

    This video shows us how the global situation is being manipulated towards war by our own Central Intelligence Agency. Watch as Michael Morell boasts about how the CIA operates – and then watch as his boasting comes to life.

    This is the creepy, sadistic little puppetmaster that is going to deliberately get our sons and daughters sent off to fight the next war “for our freedom.” This is just more proof that nothing we see on the mainstream news is as it seems and that the federal alphabet agencies are never what they present themselves to be.

  • Extensive Immigration Study Finds Impact On "Aggregate Wealth Of Natives Is, At Best, A Wash"

    Immigration has been and will continue to be a hot button topic in the 2016 presidential campaign.  Trump has called for a wall along the U.S. southern border with Mexico and a halt to all immigration from certain “countries of concern to national security.”  Meanwhile, Hillary has called for more relaxed immigration policies that would grant illegal immigrants a path to citizenship and a surge in Syrian refugees. 

    But, no matter where you stand politically on immigration, a group of the nation’s “smartest” professors from the most elite schools in the country recently came together to publish a 500-page study for the “National Academies of Sciences, Engineering and Medicine” on the economic and fiscal impacts of immigration.  After what must have been countless months of research, the report seems to confirm what most people could have derived from applying simple logic, namely that while immigration expands the economy it also negatively impacts the employment of low-skilled native workers and places undue burden on federal and state entitlements like food assistance programs and Medicaid.

    The full 500-page immigration study can be reviewed at the end of this post but here are the key takeaways…

    First, the study finds that the lower median age of immigrants is a positive offset to the aging U.S. population and serves to enlarge the economy but notes that the key beneficiaries are the immigrants themselves and not the native citizens.

    Immigration enlarges the economy while leaving the native population slightly better off on average, but the greatest beneficiaries of immigration are the immigrants themselves as they avail themselves of opportunities not available to them in their home countries.

    Immigration

     

    That said, low-skilled immigrants, which represented nearly 50% of the total in 2012, were found to have a higher employment rates than low-skilled natives indicating that U.S. citizens are being displaced at least at the lower bound of the income spectrum. 

    Shortly after arrival in the United States, immigrant men—especially recent cohorts—experience a disadvantage relative to native-born men in terms of the probability of being employed. However, for cohorts of immigrants arriving since the 1970s, after this initial period of adjustment in which their probability of employment is lower, they became slightly more likely to be employed than their native-born peers. The higher employment rate among immigrant men is mainly represented in the population with education of a high school degree or less.

     

    Immigration

     

    Immigrations

     

    Finally, first-generation immigrants were found to be more costly for entitlement programs than native-born citizens.

    Beyond wage and employment considerations, policy makers and the general public are interested in the impact that an expanding population, and immigration in particular, has on public finances and the sustainability of government programs. All population subgroups contribute to government finances by paying taxes and add to expenditures by consuming public services—but the levels differ. On average, individuals in the first generation are more costly to governments, mainly at the state and local levels, than are the native-born generations; however, immigrants’ children—the second generation—are among the strongest economic and fiscal contributors in the population.

     

    Immigrant households’ use of food assistance programs and Medicaid is much higher than that of native-headed households—not as a result of not working (in 2009, 95 percent of immigrant households with children had at least one person working) but because of lower levels of education and income.

    But perhaps, Harvard University’s George Borjas summed up the study best by telling the Wall Street Journal simply that “the impact of immigration on the aggregate wealth of natives is, at best, a wash.

     

  • America's 24/7 Circus Maximus

    Authored by Pepe Escobar, originally posted op-ed via SputnikNews.com,

    Perplexed global public opinion holds its breath at the (circus) best American “democracy” is able to conjure.

    The first cage match this coming Monday between a Queen of War profiting from a mighty (Clinton) Cash Machine and a billionaire uber-narcissist adored by a “basket of deplorables”.

    This is a circus quite fitting for a self-described “indispensable nation” where “evil” has been propelled – seriously – to the status of philosophical category.

    For the basket of deplorables, and even beyond their circle, the temptation is immense to equate voting for Donald Trump with raising a finger against the establishment.

    Ultra-savvy at playing mainstream media for invaluable free publicity, elevating Outrageousness to an art form and being impervious to irony and derision, Trump has been a master at tapping wave after wave of anger against the new liberal elite — including a nomenklatura of crypto-intellectual Ivy league-educated “experts” who could not give a damn about understanding the (real world) consequences of United States Government (USG) policies.  The anger is manifested by declassified blue collars, the unemployed, the functionally illiterate, white trash. Whatever you call them, they are the excluded form the Neoliberal Banquet, not only economically but also culturally. But this being Trump, a master of self-promotion, the battle is more like Ego against The Establishment. And it gets juicier when we learn from powerful, discreet New York-based interests – supporters of Trump’s platform — about who’s really winning:

    The Trump campaign is hardly spending any money at all and holding all over. They may use their money in the last month after the debates if Hillary recovers for those debates from what appears to be an attack of Parkinson’s. He has a shot though no matter who wins I predict there will be peace with Russia; the oil price will rise; imports from Asia of military parts will be repatriated and rigging of currencies is over; there will be offsetting measures to stop the flood of immigrants and products under mis-valued currencies. The masters do not lose.”

    The “masters” are of course the Masters of the Universe who really run the USG.

    And here’s the clincher on how’s in control:

    Both sides are controlled and that explains everything. Lenin said that the way to defeat our opponents is to take over their leadership of the opponent. Look at the Moral Majority which Jerry Falwell disbanded when it became too powerful.  Look at Ross Perot who exited when he started making a real dent. Both were taken care of and Ross made money out of it.”

     

    “Their internal lingo for it is the concept of  “dynamic silence”. This is a technique by the masters to block out all news coverage of let’s say a Nazi so that he could gain no following. That they could have done to Trump if he were not theirs. Who could have complained? He was just an apolitical real estate operator that no one was interested in.”

     

    “So what do we have in the end? An entertaining gladiatorial contest that they control both sides of and the winner gets all the money — as with the Clinton Foundation. And the public is no wiser.”

    The 24/7 Circus Maximus 

    There are subtle gradations to this scenario. Rothschild interests are not supporting Trump – according to these well-connected sources, because Trump has not been anointed by the club and is thus unreliable. They recall, for instance, how “Greenspan was so incompetent that Wall Street leaders had to give him trades so he could make money before they put him as the head of Federal Reserve. Then he was so out of it that they had to direct his every move as he had no comprehension what they do.” “They”, of course, meaning Rothschild interests.   On the Cold War 2.0 front, things are even hazier. Since 2010, when Obama was ordered to keep the US nuclear first-strike strategy, Russia and China know where this is heading. It’s no wonder Trump is being relentlessly attacked as Putin’s own Trojan Horse – because he’s against Cold War 2.0 and the demonization of Russia.

    But the Pentagon’s strident Ash Carter, soon out of a job, is one thing; another thing entirely is what the Masters of the Universe really want, according to these Trump-supporting sources; “Hillary would be following Trump’s guidelines should she win, as the US military will explain to her that she has no other options based on Russian military superiority in submarines, and defensive and offensive missiles. Trump’s policies are wise.”

    There’s even a P.R. move that could literally devastate the already wobbly Hillary campaign:

    “Hillary’s reckless threats against Russia, risking nuclear war, could bring back the Lyndon Johnson TV ads against Goldwater by Donald Trump, where we had a little child in a meadow picking flowers while a nuclear bomb goes off. It was an ad of genius and destroyed Goldwater. The first strike nuclear attack policy and the reckless provocations combine to form an excellent Johnson style ad. This time Trump can use it against the Democrats, who have created almost all the wars in the last 125 years.”

    The daisy cutter ad is here.

    A Force for Farce?

    Even considering that virtually the whole US establishment – from the Beltway nomenklatura to Wall Street — is arrayed against him, the jury is still out on whether Trump is a real threat to their interests.

    Because Trump could also be the perfect Trojan Horse. Evidence relies for instance on his appointment of perfect insiders Larry Kudlow and Steven Moore as his senior economic advisors. That’s the Trump as a Force for Farce scenario. So “dynamic silence” seems to be the rule. Here’s how dynamic silence works;

    If you oppose those above the President, the news media blacks you out and the masses do not hear anything, so how can they be stirred up? Donald is an insider and he represents the military industrial complex including the CIA, DIA, etc. They will deny it, of course, so they have deniability and he can say he is against the establishment when he is an insider.”

     

    “That is the first line of defense. If you manage to outsmart them, then they characterize you as a nut. That is the second line of defense.

     

    Now, if you persist in making them uncomfortable, then you end up as William Colby, Vince Forster or Jack Kennedy.  Richard Nixon was ousted and he went quietly so that, to quote Tricky Dick, “I am not going to end up as Jack” as he went out the back door of the White House.”

     

    The key here is Donald is receiving more publicity than Hillary, and by attacking him for being an America Firster his polls have risen dramatically. The public loves it so the Masters of the Universe are helping him. The military industries have to be repatriated as we no longer control the seas and this will require either currency adjustments or tariffs. Hence, Donald’s correct calls for an end to currency rigging which had as part of their purpose the building up of Germany and Japan at the sacrifice of our industries. Absurd that we did that but that is how it was. That is ending now with Donald and the emergency situation of lack of control of the Pacific Ocean for the component transportation by sea for our military production. Japan and Germany will be cut loose.”

     

    Brzezinski said that if any opponent leaps ahead of the United States militarily, the US ceases to be a global power. That is the case and the military knows it.  And Trump knows it or he would not have said that much. They need a crash program to catch up. That costs big money.  It will probably require force and base reductions and an increase in technological expenditure in a massive way. That is what the Russians did. They can obtain this from massively reducing the welfare transfers on illegal immigrants. That is what Donald is committed to.”

    If this analysis is correct, it ties in with Trump’s push to organize an immediate rapprochement with Russia in case he’s elected, so the US industrial-military-surveillance complex can catch up and at least try to remedy the danger of losing the next war Hillary and her own  neocon bag of deplorables are so bullish on.

    As we approach the first cage match, the jury is still out on whether the Queen of War may lose the election because millennials absolutely detest her, because the “basket of deplorables” absolutely detests her, or both.

    But one thing seems to be certain in the whole Les Deplorables saga – at least for those Masters of the Universe-connected sources; who the real winner will be. So let’s give them the last word, for now; “It will be very difficult for Hillary to beat Trump in a debate as he is quick on his feet and will take no prisoners. Let me say this. If Hillary were to win, and we don’t think she will, she will do what she is told and follow the same policies as Trump would.

  • "Eight Election Trades For November 8th"

    No matter the outcome of the presidential election, according to BofA’s Chief Investment Strategist, Michael Hartnett, 2017 will likely be a year of small absolute returns as the bank expects higher rates will collide with high bond and equity valuations, but it will be a year of big rotations “as investors shift from ZIRP winners like bonds, US, growth stocks to ZIRP losers like commodities, banks and Japan”, where BofA forecasts 20,000 on Nikkei, although for that to happen the currency would have to implode in what may be a terminal loss of faith in the central bank.

    Still, with all attention now focused on the key risk event until a potential December rate hike, namely the November 8 presidential election, BofA provides 8 specific election trades for the election.

    In a note titled “Eight election trades for Nov 8th”, Hartnett shares a variety of trade ideas, some “election-specific and some result-dependent: long VIX futures; long AUDUSD vol; long TIPS;  long global E-commerce, short fast restaurants (inequality); long US materials and largecap banks (fiscal); long US small caps, short emerging markets (Trump protectionist); long gold, short EU banks (Trump geopolitics); long Mexican peso (Clinton victory).”

    This is what he says:

    On November 8th, the US Presidential election will take place. Below we list eight trades, all specific to the election, some applicable to whoever wins, some dependent on the election result:

    Long VIX futures. It seems an obvious trade, but the election is likely to be close (see latest projected electoral college result – Chart 4). There could even be a statistical tie in the Electoral College if Trump wins FL, OH, NC, WI, IA, and Clinton wins PA, VA, CO, NV, MI, NH, arguably the most volatility-inducing event of all. VIX futures are the most liquid expression of volatility, and ahead of the first Presidential debate, the cost of a Nov’16 hedge has fallen to the 19th percentile vs. the past year.

    Long AUDUSD volatility. One way to invest in a risk-off scenario in the event of a Trump victory is long AUDUSD volatility. In our most recent FMS, a Republican victory was seen as a much greater “tail risk” for markets than a Democratic win. Trump has a more protectionist stance, and has threatened import tariffs against China, a stance that would unsettle Asian FX markets. David Woo recommends buying AUDUSD volatility to hedge election uncertainty. AUDUSD volatility is correlated with quant-fund selloffs: it is a top hedge for our BofAML MAST index.

    Long TIPS. Populism is on the rise across the globe and both candidates have redistributive policies targeted at raising wages and reducing inequality. This could lead to higher inflation. It could lead to stagflation. Either way, it will likely be positive for TIPS.

    Long Main Street, short Wall Street. Both candidates want to boost Main Street rather than Wall Street and thus propose higher minimum wages, paid family leave and higher taxation on the rich. This would be positive for US municipal bonds (U0A0). Main Street-Wall Street pair trades: long global E-commerce (BIGECOM), short fast restaurants (BINAFCRC); long mass retailers (BRUSMASS), short luxury goods makers (SPGLGUP).

    Long fiscal stimulus. Best way to leverage fiscal stimulus under either president is via infrastructure spending and defense spending. Clinton has proposed $1.65tn of additional fiscal spending and Trump has proposed $2tn, according to the justreleased Committee for a Responsible Federal Budget report; Congress-approved budgets are likely to be significantly lower. Nonetheless, the direction is clearly toward more fiscal stimulus. Long US aerospace & defense (S5AEROX), US materials (S5MATR), and large-cap banks (S5BANKX). Fiscal stimulus is the primary reason our rates strategists see higher US bond yields in 2017.

    Protectionism pair-trade: anti-globalization is on the rise, and Trump has a more isolationist/protectionist agenda; our economists believe that the Trans-Pacific Partnership is at greater risk under Trump; a reduction in global trade would likely be most negative for EM and the mercantilist economies of Germany and Japan; should US protectionism lead to a bout of inflation in the US, we think US small caps would benefit from inflation and have less foreign exposure. In our view, the best protectionist pair trade: long US small caps (RTY), short emerging markets (MXEF).

    Geopolitical pair-trades: a Trump win could mean lower capital flows to the US, a rise in Treasury yields, and a weaker US dollar, all of which would be positive for gold. A Trump victory would also raise expectations that populist parties in Europe in 2017 could rise to power and increase the European Union disintegration risk premium. Long gold, short European banks (SX7E).

    Short USD/MXN on a Clinton victory as MXN appears 15% undervalued after better Trump polls. Long health care services (SPSIHPTR), short biotech (XNBI). Best way to leverage a Clinton win, with promised tax break for health care services versus higher pharmaceutical regulation.

  • Dead People Are Voting In The Key Swing State Of Colorado

    Colorado has been a key swing state in recent presidential elections after flip-flopping back and forth between support for Democratic and Republican candidates.  Obama won the state in the past two elections but George Bush prevailed for the two preceding contests while Bob Dole narrowly eked out a victory against Clinton in 1996. 

    That said, the margin of victory has often been very tight in Colorado which is what makes the recent discovery of voter fraud there so concerning.  An investigation by CBS Denver recently found that dozens of deceased Colorado citizens continued voting multiple years after their death…even though Colorado Secretary of State Wayne Williams assured CBS that “it is impossible to vote from the grave legally.”  While we’re disturbed by the voter fraud in Colorado, we’re so glad that the legality of the issue could be cleared up so easily. 

    According to CBS, one of the most glaring cases of voter fraud they found was of Sara Sosa who lived in Colorado Springs. Sosa died on Oct. 14, 2009 but CBS found that she continued to cast her ballot in 2010, 2011, 2012 and 2013.  Likewise, her husband, Miguel, died on Sept. 26, 2008 but voted later in 2009.

    Colorado’s Secretary of State confirmed the cases of voter fraud discovered by CBS, saying:

    “We do believe there were several instances of potential vote fraud that occurred.  It shows there is the potential for fraud.  It’s not a perfect system. There are some gaps.”

     

    Of course Colorado isn’t the only place where voter fraud occurs.  Project Veritas recently recorded a  series videos in Michigan showing just how easy it is to vote as someone else.  In the following video, the Project Veritas journalist claims she is Jocelyn Benson, the Dean of Wayne State University Law School, but that she lost her ID.  The “Poll Supervisor” is quick to reassure Mrs. Benson that as long as she signs the affidavit on the back of the ballot she is free to vote.  When the journalist pushes back and insists that she feels an obligation to prove her identity the Poll Supervisor reassures her that “nobody can vote twice” because if the real Jocelyn Benson subsequently comes in she won’t be able to vote “because you already voted.”  Perfect logic if we understand it correctly.  So just to clarify, each registered voter only gets one ballot…great, this seems reasonable…but it doesn’t necessarily matter so much who casts that ballot…wait, what?

    PV Journalist:  “I feel like I should prove that I am who I am.”

     

    Poll Supervisor:  “Your word is your proof is right here.

     

    PV Journalist:  “And that’s fine?”

     

    Poll Supervisor:  “Yup.  Because if somebody else comes in and says that they’re you, they can’t because you already voted.  So, you can’t vote twice, nobody can vote twice.  So once you vote, I don’t care who you are.

     

    PV Journalist:  “You guys are fine with me just voting.”

     

    Poll Supervisor:  “Yup I’m fine.  You’re not the first one that’s left you ID at home.

     

     

     

    All signs point to a very interesting 2016 election.  Which candidate do you think appeals to dead voters the most?

  • Foreign Buying Plummets In Vancouver: Sales To Foreigners Crash 96%

    China’s favorite offshore money laundering hub is officially no longer accepting its money.

    According to data released by British Columbia’s Ministry of Finance on Thursday, foreign investors officially disappeared from Vancouver’s property market last month after the local government imposed a 15% surcharge to curb a record-shattering surge in home prices. Overseas buyers accounted for a paltry 0.7% of the C$6.5 billion of residential real estate purchases in August in Metro Vancouver; this represents a 96% plunge from the seven weeks prior, when foreigners were responsible for 16.5% of transactions by value.

    According to the latest data overseas buyers snapped up C$2.3 billion of homes in the seven weeks before the tax was imposed, and less than C$50 million in the next four weeks. The government began collecting data on citizenship in home purchases on June 10. The ministry said auditors are checking citizenship or permanent residency declarations made by buyers and also reviewing transactions to determine if any were structured to avoid tax (spoiler alert: most of them were).

    Across the province, the participation of foreigners dropped to 1.4% of transactions by value in August, from 13% in the preceding seven weeks.

    Prior to the new real estate tax home prices were almost double the national average of C$473,105; however we expect a sharp corretion in the coming weeks – as we pointed out at the beginning of September, the average price of detached Vancouver properties promptly crashed following the news tax, dropping 17% on the month, and 0.6% on the year, to C$1.47 million ($1.13 million) in August, wiping away one year of gains in a few weeks.

    As Bloomberg notes, the plunge in foreign participation joins other signs of a slowdown in Canada’s most expensive property market. 

    The silver lining is that while transactions may have ground to a halt, the government did pick up some extra tax revenues: British Columbia has raised C$2.5 million in revenue from the new levy since it took effect. Budget forecasts released last week indicated that the Pacific coast province expects foreign investors to scoop up about C$4.5 billion of real estate through March 2019.

    That may prove optimistic, because as reported two weeks ago as Chinese buyers wave goodbye to Vancouver, they have set their sights on another Canadian city: Toronto.

    According to the Star, sales of $1-million-plus Toronto-area single-family homes rose 83% year over year in July and August. That’s 3,026 homes, with 55 per cent of them inside Toronto’s borders.  That’s not entirely surprising given that the average cost of a detached home in Toronto was about $1.2 million, said Sotheby’s CEO Brad Henderson.

    “While $1 million is still a considerable amount of money, it’s difficult to find a single-family home in the city of Toronto for less than $1 million and it is not uncommon to find homes in the $2-million, $3-million or even $4-million-plus range,” he said.

    Sotheby’s says sales of homes in the $4-million-and-up category rose 74 per cent in the region and 58 per cent in the city in July and August. Sotheby’s said it expects Toronto’s luxury market to take the lead among Canada’s cities, outpacing Montreal, which probably will become a target for investors from Europe, China and the Middle East.

    “What the (Vancouver) tax introduced is . . . some uncertainty as to what other policy issues the city or the province may introduce, which would adversely affect investors,” Henderson said, adding that  investors are looking elsewhere, including cities outside Canada.

    “But, if they are looking in Canada, we believe Toronto will be the most logical place for people to consider. Montreal and Calgary will probably also get a look-see,” Henderson said.

    Or maybe not.

    As CBC reported earlier this week, economist Benjamin Tal of CIBC said that Ontario will have little choice but to copy Vancouver and implement a tax on foreign house buyers.  In a recent note to clients, the economist said the biggest problem facing policymakers with regard to hot housing markets in Toronto and Vancouver is a limit on the supply of new homes.

    “The main reason behind higher prices in the [Greater Toronto Area] is a policy-driven lack of land supply,” Tal said. “And with no change on that front, policymakers have to use demand tools to deal with what is essentially a supply problem.”

    Tal doesn’t speculate how much of a tax could be under consideration for Toronto, nor does he have any insight as to when and how it might be implemented.

    A foreign buyer tax is not the only possible response to the problem of high house prices. Among other possibilities, Tal cites:

    • Compelling banks to tighten their lending practices by making them pay for their own mortgage insurance.
    • Raising the down payment minimum to 10 per cent, even for homes under $1 million,
    • Closer monitoring of lending to subprime buyers.
    • Offering tax incentives to developers to make more purpose-built rental buildings, including more flexible rent control rules, as ways of cooling Toronto’s housing market.

    Tal says Toronto’s housing market has been inflated by cheap lending to people who would have no business getting a mortgage if rates returned to more typical levels.

    Of course, if Toronto does what Vancouver did and tries to spook away foreign buyers, the housing bubble will simply keep jumping city to city, first in Canada, then in move to the US, and back over to Europe, until soon the entire world makes it clear that China’s $30 some trillion in deposits that are just itching to be parked offshore are no longer welcome, forcing the Chinese government to finally deal with the alarming consequences of its own unprecedented monetary injections, which now amount to some $4 trillion in new money creation mostly by way of bank “loans” (and thus deposits) every single year.

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