Jan 15

Today’s News 15th January 2017

  • The Clinton Foundation Is Shutting Down The Clinton Global Initiative

    In a “mass layoff” event reported late last week by the Department of Labor, the Clinton Foundation announced it would lay off some 22 employees at the Clinton Global Initiative, which attained notoriety during the John Podesta leaks, when the various details of the fallout between between CGI head Doug Band and Chelsea Clinton were revealed; it also emerged that long-time Bill Clinton friend Band was soliciting donations for Clinton through his PR firm, Teneo in an sordid example of “pay for play” which most of the mainstream media refused to cover, especially after Band emailed Podesta “If this story gets out, we are screwed.”

    Filed as mandated by the Department of Labor’s Worker Adjustment and Retraining Notification, or WARN notice, on January 12, the Clinton Foundation’s Veronika Shiroka advised the DOL that as part of a “Plant Layoff” it would layoff 22 workers on April 15, with reason for the dislocation stated as “Discontinuation of the Clinton Global Initiative.” The layoffs are part of the Clinton plan put in motion ahead of the presidential election, to offset a storm of criticism regarding pay-to-play allegations during Clinton’s tenure as secretary of state.

    As the Daily Caller notes, the layoffs were reportedly announced internally in September, ahead of Clinton’s stunning loss to President-elect Donald Trump. Many other employees had already begun looking for or accepting other jobs at that time, as it had become clear the future of the initiative was in doubt. It’s unclear how many of the once 200 strong staff might remain at the Clinton Foundation in some other capacity.

    As a reminder, while the FBI has cleared Hillary Clinton of wrongdoing regarding her use of a private email server, a parallel probe into the Clinton Foundation regarding allegations of corruption is still ongoing.

    The decision to sunset the Clinton Global Initiative reportedly set off a dispute within Clinton Foundation circles regarding the best way to handle the fallout from the allegations. Some complained the layoff process was “insensitively” handled, Politico reported, while others took issue with the optics of allowing anyone with the Clinton Global Initiative to stay on.

    And while CGI is now officially being “discontinued”, the same fate likely awaits the Clinton Foundation itself following news in the aftermath of Hillary Clinton’s loss to Trump that Australia has cut its donations to the foundation to $0, while the far more generous Norway likewise slashed its donations by 87% as the political cout of the “charitable” organization dried up and as the opportunity for any future “quid pro quo” is now effectively gone.

  • We Are Getting Worried About Paul Krugman

    When a delicate snowflake is suddenly faced with a perceived reality so devastating as to be an existential crisis, the mind's reaction to dealing with this cognitive dissonance can be disabling for some. Certainly for The New York Times' flip-flopping, hate-mongering, fact-twisting, Keynesian poster-boy Paul Krugman it appears coping with "no" is not going well and his tirade last night in Twitter has us gravely concerned for his mental stability, which is ironic given how he began yesterday…

    But that was followed quickly by a six-tweet-rant nothing short of what we would expect from a dejected five-year-old who just got denied another scoop of ice cream…

    Krugman once again blames the ignorance of the deplorable masses (who just don't get what a "fraudster" Trump is) in shunning him and his "know-it-alls", but he has been heading down this hill of manic-depressive lashing out for weeks now having recently suggested Trump will unleash a 9/11-style attack to legitimize his presidency.

    Is he hoping to maintain a groundswell of "well, if he is not hitler… he must be worse" thoughts among those so easily led? Still, coming from a man who has prognosticated alien invasions as a global economic growth engine, we are not sure if he is mental situation is improving or deteriorating. We wish him well.

  • Will The CIA Assassinate Trump? Ron Paul Warns Of "More Powerful, Shadow Government"

    Submitted by Mac Slavo via SHTFPlan.com,

    It isn’t just that Donald Trump routinely thumbs his nose at the establishment, insults media figures he sees as unfair and bucks conventional wisdom.

    It is that President-elect Trump is defying the will of the deep state, military industrial complex base of ultimate power in the United States. That is why he is treading dangerous waters, and risks the fate of JFK.

    Trump publicly dissed the intelligence community assessments on Russian hacking; they retaliated with a made up dossier about the alleged Trump-Putin ‘golden shower’ episode.

    While it may be a silly falsehood, it may also be serving as a final warning that they get to script reality, not him.

    Perhaps they want Trump to feel blackmailed and controlled by alluding to fake dirt, while reminding him of the real dirt they hold on his activities (whatever it may be).

    Insulting the credibility of the intelligence community in a public way – as the man elected to the highest office in the land – is liable to ruffle a few feathers, and it could provoke a serious response.

    Trump knows the power of the people he is taunting, but he may not be aware of where the line is between play in political rhetoric and actually irritating and setting off those who control policy.

    There is plenty of Trump misbehavior that can be simply written off, or trivialized, but cutting into the war and statecraft narrative of the shadow government steering this deep state is a deviation too far.

    It is one thing to play captain, but another to imagine that you steer the ship. They are happy for Trump to take all the prestige and privileges of the office; but not for him to cut into the big business of foreign conflict, the undercurrent of all American affairs, the dealings in death, drugs, oil and weapons, and the control of people through a manipulation of these affairs.

    If President Trump takes his rogue populism too far, he will suffer the wrath of the same people who took out Kennedy… there are some things that are not tolerated by those who are really in charge.

    And now leaders in the Senate are warning President-elect Trump about the stupidity of going against the national-security establishment.

    As Jacob G. Hornberger warns:

    In a truly remarkable bit of honesty and candor regarding the U.S. national-security establishment, new Senate minority leader Charles Schumer has accused President-elect Trump of “being really dumb.”… for taking on the CIA and questioning its conclusions regarding Russia.

     

    “Let me tell you, you take on the intelligence community, they have six ways from Sunday at getting back at you…. He’s being really dumb to do this.”

     

    […]

     

    No president since John F. Kennedy has dared to take on the CIA or the rest of the national security establishment […] They knew that if they opposed the national-security establishment at a fundamental level, they would be subjected to retaliatory measures.

     

    Kennedy… After the Bay of Pigs, he vowed to tear the CIA into a thousand pieces and scatter them to the winds. He also fired CIA Director Allen Dulles, who, in a rather unusual twist of fate, would later be appointed to the Warren Commission to investigate Kennedy’s murder.

     

    Kennedy’s antipathy toward the CIA gradually extended to what President Eisenhower had termed the military-industrial complex, especially when it proposed Operation Northwoods, which called for fraudulent terrorist attacks to serve as a pretext for invading Cuba, and when it suggested that Kennedy initiate a surprise nuclear attack on the Soviet Union.

     

    […]

     

    Worst of all, from the standpoint of the national-security establishment, [Kennedy] initiated secret personal negotiations with Soviet Premier Nikita Khrushchev and Cuban leader Fidel Castro, both of whom, by this time, were on the same page as Kennedy.

     

    […]

     

    Kennedy was fully aware of the danger he faced by taking on such a formidable enemy.

    And to the extent that President Kennedy consciously stood up to the system, he paid the price for his attempt at independent wielding of power from the Oval Office.

    It is a shuddering thought. A sharp lesson in history that must not be misinterpreted.

    The implications for Trump are quite clear. If his refusal to take intelligence briefings, or follow CIA advice is serious, then serious consequences will follow. If Trump is serious about peace with Putin when they insist on war, there will be a problem.

    There are several powers behind the throne that have wanted to ensure that presidents don’t let the power go to their head, or try to change course from the carefully arranged crisis-reaction-solution paradigm.

    True peace is not good for military industrial complex business; true peace, without the persistence of grave threats, and plenty of sparks of chaos to back it up, cannot be tolerated.

    As things have progressed today, making friendly with Putin, and calling off the war with Russia may simply be impermissible. If Trump is attempting to negotiate his own peace – and sing along with Frank Sinatra’s “My Way” at the inauguration, then he is in for a very rude awakening.

    If, on the other hand, he is the Trump card being played by this very same establishment, then things may develop according to the same ultimate objectives, albeit through a ‘wild card’ path styled after the ego of President Trump.

    With Goldman Sachs and neocon advisors filling up his administration, Trump may be simply nudged in the right direction. But the intelligence community is not willing to take many chances – and there are clearly contingencies in place.

    As SHTF has previously reported, the continuity of government “Doomsday” command-and-control planes were brought out after the election as a public show of power to Trump and the American people. The shadow government is real, and for now, maintains dominance.

    Former congressman and presidential candidate Ron Paul warned of the shadow government taking control of President Trump’s administration before it was even formed:

    You know, we look at the president, we look at what he said, we look at what he might do, and we look at his advisors, but quite frankly, there is an outside source, which we refer to as a deep state or a shadow government. There is a lot of influence by people that are actually more powerful than our government itself, our president and on up. I mean, you take for instance how our government gets involved in elections around the world, whether it’s in the Middle East or Ukraine.

    Trump is reportedly retaining his own private security, bucking the protocol of Secret Service detail… and this clearly a sign that he and his team have thought through security issues and the possibility of an inside job.

    This is prudent, but these deep state guys have access throughout the system at every level. They are anywhere, and everywhere. Probably someone that Trump trusts. There are certainly many threats.

    For the sake of the stability of this country, and President-elect Trump’s own life, let us hope that they stay several steps ahead of anyone who might want to do him harm.

    This is eerie, but real.

    *  *  *

    On a personal level, it seems wise to prepare for the possibility of widespread unrest due to political instability.

    Tread carefully at the scene of the inauguration, and any high profile political gatherings or demonstrations.

    Riots at the inauguration, or in cities throughout the country are possible, maybe even likely, as is an attempted assassination. Even if this scenario is a long shot, and taboo to even discuss, the role of the CIA in past coups, revolutions and uprisings is enough to warrant taking precautions.

    There is an element of chaos present during this unprecedented transfer of power to the 45th president, and a wounded animal in the defensive-attack posture.

    If you are at a protest, either as a participant, or as an observer, remain aware of the larger actions of the crowd, identify potential provocateurs and stay away from points of potential violence. Police could use anti-riot gear and spray the crowd, fire rubber bullet, use microwave heating or auditory devices, make mass arrests, or block off large portions of the city.

    If anything significant happens, use any available phone or camera to film it, but be prepared for confiscation or technologies to wipe phones. An EMF shielded bag could block this; live stream or upload instantly to as many video platforms as possible, but they have been known to jam cell phone signals at mass gatherings and demonstrations. Make copies and store a physical copy, and several back-ups.

    If you are at home, do not wait for the all clear signal from the authorities, shelter in place and prepare to ride out a storm, if something sensational or deadly takes place and panic spreads. Do not trust the media; and try to take notice if a coup has taken place, and constitutional authority subverted.

  • In His First Foreign Trip As President, Trump Plans To Meet With Putin In Reykjavik

    Donald Trump and his advisers have told British officials their administration’s first foreign trip will be a meeting with Russia’s Vladimir Putin in the capital of Iceland, the Sunday Times reported, citing an unidentified source, a move that is certain to unleash even more domestic and foreign criticism of Trump’s alleged proximity to the Russian leader.

    According to The Sunday Times, Trump hopes to conduct the Putin “summit” within weeks of his January 20 inauguration in the Reykjavik, “emulating Ronald Reagan’s Cold War deal-making in Reykjavik with Mikhail Gorbachev.”  

    The meeting with Vladimir Putin, which would be Donald Trump’s first foreign trip, is where Trump will start working on an agreement limiting nuclear arms within a “reset” in US-Russian relations. The Times adds that according to sources close to the Russian Embassy in London, Moscow would agree to a summit between the two heads of state.


    A summit between Putin and Trump could reset western relations with the Kremlin.

    The meeting would come just over 30 years since the historic summit on October 11-12, 1986, between Ronald Reagan and Mikhail Gorbachev, the second in a series of meetings that relaunched the relationship between the United States and the Soviet Union, and ultimately led to a material de-escalation in the raging, at the time, nuclear arms race between the USA and USSR.

    And, just like Ronald Reagan then, Trump wants to discuss nuclear disarmament with Putin, the Times reported, adding that sources said Trump wants to meet Putin outside of Russia and that Reykjavik was a strong contender.

    The latest report comes just a day after Trump told the WSJ he is open to lifting the sanctions against Russia “under certain conditions.” In an hour-long interview on Friday, Trump said he wants to keep the sanctions that the Obama administration recently imposed on Russia “at least for a period of time.” However, the President-elect added that he would consider lifting the restrictions, depending on how helpful the Russians are in the fight against terrorism, as well as assisting with other goals that he feels are key to the US.

    The meeting has not officially been announced by Trump team officials or Russian officials, and reports say Iceland has not been formally contacted about such an event. But more importantly, the talking points for all of Sunday’s news shows and media talking points are currently being updated to reflect this latest olive branch by the Trump administration toward the Kremlin, which will be promptly spun as further “proof” of Putin’s diabolical control over his brand news Oval Office puppet.

  • 2017: Change Can Be A Bitch

    Submitted by Raul Ilargi Meijer via The Automatic Earth blog,

    2016 brought a lot of changes, or rather, brought them to light. In reality, the world has been changing for many years, but many prominent actors benefitted from the changes remaining hidden. Simply because their wealth and power and worldviews are better served that way.

    It’s entirely unclear whether we will ever get a chance to see to what extent the efforts to hide developments have been successful, or even been perpetrated at all, because we don’t know to what extent truth and reality will be accessible in the future.

    What we can say at this point in time is that the changes 2016 delivered were urgently needed. There are many people out there who just want to turn back the clock, and change everything back to how it was, but they can’t, and that’s a good thing, because the way things were was hurting too many people.

    2016 will go down in history as the year when a big divide between groups of people in the western world became visible, a divide that had until then been papered over by real or imaginary wealth, as well as by ignorance and denial.

    When politics and media conspire to paint for the public a picture of their choosing, they can be very successful, especially if that picture is what people very much wish to see, true or not. But as we’ve seen recently, our traditional media have become completely useless when it comes to reporting news; the vast majority have switched to reporting their own opinions and pretending that is news.

    On the one hand, there is a segment of society that either has noticed no changes, or is so desperate to hold on to what they have left, that they resist seeing them. On the other hand, there are those who feel left behind by that first group, and by the idea that the world that is still functioning and even doing well.

    The first group has been captivated by, and believed in, the incessantly promoted message of recovery from an economic, financial and gradually also political crisis. The second see in their lives and that of their friends and neighbors that this recovery is an illusion.

    It’s like the old saying goes: you can’t fool all of the people all of the time. And that’s why you have Brexit and Trump and why you’re going to have much more of that, certainly across Europe. Things are not going well, and there is no recovery, for a large enough percentage of people that their votes and voices now swing the debates and elections.

    It’s not even complicated. This week there was a report from Elevate’s Center for the New Middle Class that concluded that half of Americans, 160 million people, can’t afford to have a broken arm treated (at $1,400). And sure, you can say that perhaps that number is a bit too high, but there have been many such reports, that for instance say the majority of Americans have less than $1000 in savings, and can’t even afford a car repair.

    In Britain numbers are not much different. Over the past decade, the country has been very busy creating an entire new underclass. If your economy is not doing well, and your answer to that is budget cuts and austerity, it’s inevitable that this happens, that you create some kind of two-tier or three-tier society. And then come election time, you run the risk of losing.

    Both Britain and the US boast low unemployment numbers, but as soon as you lift the veil, what you see is low participation rates, low wages and huge numbers of part-time jobs stripped of all the benefits a job used to guarantee. It allows those who still sit pretty to continue doing that, but it’ll come right back to haunt you if you don’t turn it around, and fast enough.

    For many people, Obama, Merkel, Cameron and the EU cabal have been disasters. For too many, as we now know. That doesn’t mean that Trump will fix the economic problems, but that’s not the issue. People have voted for anything but more of the same. Which in Britain they’re not even getting either, so expect more mayhem there.

    In most places, some variety of right wing alternative is the only option available that is far enough removed from ‘more of the same’. Moreover, many if not most incumbent parties are in a deep identity crisis. Trump did away with the Republicans AND the Democrats, and they had better understand why that is, or they’ll be wholly irrelevant soon.

    In Britain, the most important votes in many decades was lost by the Tories, who subsequently performed a musical chairs act and stayed in power. You lost! Losers are not supposed to stay in power! But the other guys are all too busy infighting to notice.

    That identity crisis, by the way, is not a new thing. If you look across the western political spectrum, there are all these left wing and right wing parties happily working together, either in coalition governments or through other ‘productive’ forms of cooperation. So who are people going to vote for when they’re unhappy with what they’ve got? Where is that ‘change’ that they want? Not on the traditional left or right.

    So you get Podemos and M5S and Trump and UKIP and Le Pen. It’s not their fault, or the voters’ fault, it’s the political establishment that has tricked itself into believing in the same illusion it’s been promoting to voters.

    And yes, they have now proven that it’s possible to stave off, for a number of years, a deeper crisis, depression, by borrowing and printing ‘money’. Especially if you can at the same time hit the poorest in your society with impunity.

    But in the end no amount of fake or false news on the economic front will allow you to continue the facade for too long, because people know when they can’t afford things anymore. The evidence here is somewhat more direct than with regards to political fake news, though they may well both follow the same pattern of ‘discovery’.

    Our societies are still run as if there is no real crisis, as if it’s all just a temporary glitch, as if the incumbent models function just fine, and as if recovery is just around the corner. And we can make it look as if that is true, but only for an ever smaller amount of time, and for an ever smaller amount of people.

    The basic issue here is not a political one. It’s economic. Our economic systems have failed, and they can’t be repaired. We should always have realized that no growth is forever, but at least we now know. Or could know, it’ll take a while to sink in.

    Next up is a redo and revamp of those economic systems, but that is not going to be easy, and may not get done at all. The resistance may be too strong, warfare -economic or physical- may seem like a way out, there are many unknowns. We could, ironically, get quite far in that redo if we simply cut all the waste for our economic processes, but then again, that would have us find out that much of the system runs entirely on wasting stuff, and wasting less kills the system.

    However that may be, and however it may turn out, this is where we find ourselves. Protesting Trump and Brexit is inevitable, but it doesn’t address any core issues. From a purely economic point of view, Obama failed spectacularly, as did David Cameron, as does Angela Merkel. And as do, we will find out in 2017, many other incumbent ‘leaders’.

    Their successors, whatever political colors they may come from, will all come to power promising, and subsequently attempting, to restart growth. Which is no longer feasible across an entire country, or even if it were, it would mean squeezing other countries. With corresponding risks.

    Trump and Brexit are necessary, perhaps even long overdue, in order to break the illusion that things could go on as they were. But they are not solutions. America needs a big wake-up. Trump looks likely to deliver one. That is needed for the rest of the country to wake from its slumber. Ask yourself: are you going to get weaker from dealing with a Trump presidency? Maybe not the best question, or at least not before having asked: do you know how weak you are right now?

    For Britain to leave the EU is a great first step. As I’ve said many times, centralization is not an option without growth. And Brussels has shown us quite a few of the worst consequences of centralization. Nobody should want to be a part of that.

    Summarized: for most people, 2017 will be the year of the inability to understand where their favorite worldview flew off the rails. Change can be a bitch. But change is needed to keep life alive.

  • Harvard Is 'Billionaire-Making' University

    Want to learn about the history of economics, how to code with Ruby on Rails, or the essentials of string theory? It’s all out there for free on the internet, and anyone who has the time or energy can learn it directly from the experts.

    The Information Age grants us an unprecedented amount of access to the world’s knowledge – and some thinkers like James Altucher or Peter Thiel see this leading to a path where the role of colleges and universities will continue to diminish.

    We share that sentiment. The most recent crop of successful entrepreneurs like Evan Spiegel or Mark Zuckerberg already proves that entrepreneurs can make billions without spending a full four years in the classroom. The forthcoming generation will be even less tied to attending brick-and-mortar institutions.

    However, as Visual Capitalist’s Jeff Desjardins notes, there’s one caveat to this line of thought, however, and it coincides with this week’s chart. While one can say that the actual academic value of these institutions may be undermined by access to the digital world, the value of these as places to “rub shoulders” with up-and-comers still remains entrenched.

    Courtesy of: Visual Capitalist

     

    A BILLIONAIRE MAKING MACHINE

    Talk to any successful person in business and they will tell you that developing a strong network is half of the battle. As far as schools go, Harvard is the perfect example of the “network effect” at work.

    To date, a total of 35 of the richest 500 people in the world have emerged from the storied halls of Harvard. In fact, more billionaires have graduated from Harvard than all of those hailing from Saudi Arabia and Spain combined.

    The total net worth of the top 35 Harvard billionaire graduates? It’s $309 billion – roughly equivalent to the GDP of Hong Kong or Ireland. With alumni like Charlie Munger, Meg Whitman, John Paulson, Steve Ballmer, Paul Singer, Ken Griffin, Ray Dalio, and Michael Bloomberg among the ranks of Harvard graduates, it’s a powerful hub to tap into. Today’s Harvard students and professors take advantage of this prestigious network every day.

    Elite universities still serve as filtering mechanisms that only bring in students that are smart, well-connected, or both. Top schools like Stanford or Harvard have acceptance rates less than 6%, and this exclusivity gives graduating students a connected and privileged network from the get-go.

    One hundred years from now, will these institutions still have the same track records from the exclusivity factor alone? It remains to be seen, but for now they are still undisputed billionaire making machines until proven otherwise.

  • The Clinton Global Initiative is shutting down

    This article was originally posted at www.disobedientmedia.com

    A document from the New York State Department of Labor reveals that the Clinton Global Initiative is being discontinued.

    Filed on January 12, 2017, the document shows the layoff of a specialist employed by the Clinton Global Initiative as part of a “plant closure” and that the reason for their discontinuation was the “Discontinuation of the Clinton Global Initiative.”

    The news of the closure of the Clinton Global Initiative comes after reports emerged in the Fall of 2016 that they were laying off dozens of workers at their New York offices.

    The Clinton Global Initiative was founded in 2005 by Bill Clinton and associate Doug Band. Band and Clinton were dogged by accusations of corruption, which intensified after 2016 document releases by Wikileaks revealed that Band was soliciting large numbers of donations for Clinton through his public relations firm, Teneo.

  • Treasury Specs Are So Short, It Is Now A 4 Sigma Event

    With doubts that the “Trumpflation” trade is over creeping ever higher, leading to a precarious decline in the USD in recent days, and prompting comparisons to the Dollar’s move at the start of 2016 when the greenback’s ascent dramatically reversed…

    … resulting in a pick up in the long end, which has outperformed the Dow YTD in 2017…

    … it was surprising to see that traders, seemingly unfazed by recent price action, took their record shorts across the Treasury curve, and made them even recorder.

    According to the latest breakdown of short positions by Deutsche Bank, speculators increased their net shorts by $7.7 billion in 10Y cash equivalents to $99.4 billion, a third successive week of record low positions.

    The Breakdown by 5Y net specs…

    … 10Y net specs…

    … and 30Y net specs…

    … shows just how aggressive the short pile up has been.

    According to DB’s calculations, the net short position is now a four sigma event, having grown to nearly four standard deviations away from mean, even after adjusting for open interest.

    TY and FV net spec shorts reached new record highs of 395K (+50K) contracts and 437K (+27K) contracts, respectively. An exception was in TU futures where specs pared 35K contracts from their net shorts. Spec net short in Eurodollars also increased to a new record high of 2,442K (+326K) contracts.

    And while other asset classes were relatively unchanged, with the recent surge in net specs in oil, nat gas and copper all moderating slightly in recent weeks…

    … a separate observation by Bank of America suggest that the recent hedge fund infatuation with equities may be over, after hedge funds net sold the most S&P 500 contracts in a week since Jan. 2016., while the recent surge in Russell bullish bets also appears to have found a ceiling for now, and while buy-side net position in Russell 2000 was near record high (a “contrarian bearish” signal), a near term a move below 1347.2 would trigger a tactical bearish signal for the 1308.85 to 1300 area, according to Bank of America.

    Of all of the above, keep an eye on the record(er) TSY shorts: a few more indication that the Trump reflation rally is over, or worse, inverting especially if the recent spike in positive macro news tapers off, we may witness one of the most violent short squeezes across the rates complex in history.

  • Trump Has 6 Goldman Appointees- Swamp Drains You

     

    Dear Trump Voters: Goldman Wins Again.

     To the Trump voters scratching their heads at the PEOTUS’ recent appointments. This is the nexus of finance influencing politics in real time. Here is your chance to save yourselves years of denial, cognitive dissonance, regret, and therapy when you are forced to confront the reality that you were lied to. 

    Why Trump Voters are Stupid

    Via Soren K and Marketslant Once we cast our votes our egos have a stake in the outcome. Many become enamored with their “identity” decision. Like Obama voters before, some people actually believe things will be different this time under Trump. This bias only lets in facts corroborating their opinion. We see only what fits the identity narrative adopted. In an emergency, there are plenty of “safe spaces” we can find online to perpetuate the illusion.  

    And come on, Trump is the car salesman dripping in gold that attracts a certain type of car buyer, the status seeker. Maybe if I buy from him, I’ll be like him. Hillary is worse. At least Trump is transparent about his narcissism.

    Here’s the thing, people are slowly catching on to the lies that systems perpetuate on people by co-opting leaders. The people know now that Wall Street is about money first, and service second. People are beginning to sense that Obama was not an instrument of change. The Hillary and DNC emails should have stripped voters’ political delusions. Sadly that didn’t happen. The power of denial is strong

    Liberals are now the new bitter-clingers. They hug their idealistic but inflexible beliefs in globalism and a premature Kumbaya world. This is exactly how Obama described the right. He called them bitter-clingers to guns and G-d. 

    Meanwhile a whole generation of Republicans actually thinks  Trump is the answer to their prayers of hope and change. Wake up. Trump is so happy he’s on the inside now. He’s the Howard Stern of finance/politics. Ranting to be let in. Then kissing the ring of the ones who made campaign contributions to Hillary. 

    Trump Now has 6 Goldman Appointees

    1. Bannon – Sr. Adviser
    2. Scaramucci – Adviser
    3. Mnuchin – Treasury
    4. Powell – Counselor
    5. Cohn – NEC
    6. Clayton – SEC

    Goldman Sachs is a fraternal culture.  You never really “leave” Goldman, just like there are no EX-Marines. So the question any reasonable person should be asking is “Why so many Goldman people?”  The answer is we believe right now Trump and GS are building a symbiotic relationship. They are trading debt for influence via soft dollar transactions. But we have no factual evidence. We are not journalists with the resources to prove this. But there is plenty of history to tell. If there is a real journalist out there who isn’t worried about getting fired for taking the time to investigate a conflicted POTUS and an opportunistic bank with an amoral behavioral pattern now is the time to look. Not 4 years from now.

    Trump Org has a Lot of Debt

    As of Dec 12th here were 2 of Trump’s biggest corporate creditors and a simplified look at the issue each has with Trump. 

    1- Deutsche Bank: $364 million 

    • ?DB has DOJ issues in the amount of a $14 billion claim, major balance sheet problems and is in litigation with Trump on his debt.
    • DB’s DOJ issues are a huge conflict of interest if Trump is POTUS while the DOJ is investigating them

    2- Ladder Capital: $282 million

    • Trump is personally liable for $26MM
    • a POTUS who is personally liable for a debt has an enormous conflict of interest

     

    According to his own public disclosure,Trump, as of May, was on the hook for 16 loans worth
    at least $713 million. This list does not include an estimated $2 billion in debt     amassed
    by real estate partnerships that include Trump. One of those loans is a $950
    million deal that was cobbled together by Goldman Sachs and the state-owned
    Bank of China—an arrangement that ethics experts believe violates the Constitution’s emolument clause,     which prohibits foreign governments from providing
    financial benefits to federal officials. Mother Jones

    So, you can see that it is in Trump’s best interest to restructure these loans because of conflicts that could impede his objectivity as President. DB is in no position to risk more headlines that drive its stock even lower as it negotiates with the DOJ on a better settlement. And Ladder is reportedly struggling under the weight of its own balance sheet.

     

    Deutsche, Ladder, and Trump Need Help

    What we need here is someone who can do DB a favor and take the debt off their hands which would: alleviate them of Trump litigation, shrink their systemically risky balance sheet, and reduce chances of more DOJ headline risk tied to the new administration.

    For Ladder Capital, that hero must buy the debt and remove Trump’s personal liability.  Ladder had hired Citibank to help it find a buyer for the Trump debt according to Mother Jones.

    Meanwhile, Trump needs to divest himself of potential interest conflicts as well as make sure he is not a sitting president who can be sued by a creditor. What would be even cooler would be if somehow Trump could get his deals renegotiated at better terms. But how to reciprocate if someone did such a favor?

     

    Enter Goldman Sachs?

    Sources: GS had been buying Trump’s debt up from Deutsche and Ladder with totals so far around $400 mm. This is yet not confirmed, and we are not in the business of empty conjecture.  So lets see if there is a trade here.

    Like most people, we are kept in the dark fact-wise and fed a lot of crap by our elitist bettors. Some decision analysis is warranted.

    • Who Benefits?- Trump, DB, Ladder, and whoever buys the debt
    • Who has the ability to do it?- any Financial institution with good lawyers and weak ethics (all of them)
    • Who has done it in the past?- all of them 
    • How do Trump and the Debt Buyer materially benefit?
      •  Trump benefits because the debt terms under GS (or other bank) are probably better for him. (Lower rates, personal liability removed etc)
      • Trump Rewards GS (or other bank) with positions that afford  policy influence, “first to know”, status, etc
    • How does the Debt Buyer avoid conflict with Trump?
      • be squeaky clean with the DOJ- a white knight at the Buffet table always helps
      • have off balance subsids it can put debt in- e.g. former employees who run hedge funds that the former employer invests in
      • securitize debt and sell to client base- like subprime loans 
      • must be sharp  with a flat hierarchy and low bureaucratic latency- a firm that aggregates risk but decentralizes decision making (Marines, not Army)

    Here is your chance right now to acknowledge what your gut is already telling you before 4 years go by. Trump is full of shit and out for himself only. If something good comes of his administration it will not be because of him. It will likely be in spite of him. Intervention in markets and economies only helps in the direction of the trend.

     

    Why We Feel Goldman is Buying the Debt

    So empirically speaking, not as politicians who claim objectivity in their process but use rhetoric to manipulate facts, we can say 2 things:

    1. Based on evidence, belief, and past behaviors it is highly likely that some firm is going to accumulate Trump’s debt.
    2. And based on Trump’s appointees, GS culture and acumen, we put Goldman Sachs at the top of that list.

    When the data suggests or drifts in another direction we will adjust our opinion. We are careful to test our own biases and acknowledge them

     So we don’t know if Goldman is running around collecting Trump’s chits. But we damn sure expect someone is because there is a need for it on both sides of the equation. DB and Ladder need out, and Trump needs out. And we don’t see 10 guys from DB or CITI being hired. We see Goldman guys getting jobs. 

    And if we are wrong, that’s ok too. Because someone is buying that debt. DB and Ladder definitely do not want it.  

     

    Goldman and the  Emolument Clause

    There is one other large loan that already directly involves Goldman Sachs. It’s the one discussed in context of the Constitution’s emolument clause.

    Time: “It appears that Trump’s largest debt obligation is tied up with his 30% stake in the building at 1290 Avenue of the Americas, which is near Rockefeller Center. The financial obligation on that building is $950 million. Trump is responsible for 30% of that debt. It is, by far, the single biggest debt obligation among his signature properties. Were it to become a troubled asset for any reason, it would cause an immense and immediate problem for the bottom line of his business. There are two big lenders involved with the complicated debt structure on this asset, the Times reported. One of them is the state-owned Bank of China. The other is Goldman Sachs.”

    Legally, we are sure Trump will have a defendable argument. But biased and objective in his duties as POTUS? Doubt it.

     

    There is no Conclusive Proof, and There Never Will Be Again

    The brilliance of society’s embracing deductive reasoning banished opinions without facts being represented as truth. But unethical people find a way to pervert it now. They say things like: No body, no murder… “f they don’t have proof, just deny it...  and “What is the definition of IS?”  Facts are only the purview of higher ups. Its kind of a class warfare thing.

    The result is, no-one asks ( or is afraid to ask) the questions anymore that lead to the facts that prove or dismiss the intuition. Everyone is a fucking lawyer now. Did you see your child take the cookie? Then you can’t be sure, can you? Nothing gets investigated unless we have metaphysical certitude now. The Gold and Silver manipulation case is an example. The perpetrators do not care. They are off shearing sheep in Asia now after manipulating metals for 20 years.

    No-one will call that yellow thing with the orange beak a duck until it: drinks the water, lays an egg, and bites you on the face these days.

    Evidence Drift

    So when something cannot be proven factually, but the consilience of accumulated data using different measuring methods points to a likelihood of truth, adjust your behavior accordingly. We do not know if Trump is cutting deals that compromise his status, but we believe he is and will act accordingly.  We will stay away from the thing that looks like a duck until proven otherwise. 

    Good Luck

    H/T Vlanci@echobay.com

     

Digest powered by RSS Digest

Jan 14

Today’s News 14th January 2017

  • "The Spiritual Center" of the Democratic Party, John Lewis, Says Trump Is Illegitimate Because Muh Russians

    The cuckery has reached a fevered pitch and the democratic party, in what can only be construed as a traumatic emotional breakdown on an institutional level, are throwing the gauntlet down here and now by sending out the so called ‘spiritual center’ of the party, Congressman John Lewis — declaring Trump ‘illegitimate’ because (wait for it) MUH RUSSIANS.

    It has been an absolute blitzkrieg of U.S. intelligence leaks and disinformation, all designed to damage the incoming President — coordinated by uniparty shills in both the republican and democratic parties.

    Here’s Chuck Todd, channeling Ceasar Flickerman’s disingenuous and overly dramatic cadence from the movie The Hunger Games, interviewing  Congressman John Lewis — who said he would not be attending the inauguration because the Russians hacked John Podesta’s email box and revealed the democratic party was an organization rife with both corruption and criminality at the highest levels. These revelations must’ve been the difference between electoral college winship and bitter defeat, obviously.

    Charles Krauthammer, hardly a Trump fan, calls bullshit on all of these events — suggesting a conspiracy to diminish the office of the President is at hand.

     

     

    Content originally generated at iBankCoin.com

  • Is This The Coup In America? "U.S. Troops On Russian Border" To Start War Before Inauguration

    Submitted by Mac Slavo via SHTFPlan.com,

    Is there a coup underway, while America is in the transition period, and before Trump swears in as the 45th president of the United States?

    How real is the clash between the rogue Manhattan billionaire and the intelligence gang behind the throne? Who will win the struggle for power over foreign policy? These are serious times and require serious considerations.

    The U.S. sent an entire armored brigade to the Russian border, and Vladimir Putin is preparing as if for war. Missile defense systems are raised; tall claims and serious charges have been leveled; diplomatic relations have chilled to a permafrost. Several Russian diplomats have turned up dead recently, including one murdered in front of cameras during a dramatic assassination in Turkey. Russia has bucked U.S. order in the Middle East, and carved out a potential peace deal in Syria without their consultation.

    Things are reaching a flashpoint, and the system is concerned about controlling President-elect Trump given his rumored friendliness with Putin and plans to drop sanctions.

    Will there be a “shock” designed to correct Trump’s foreign policy, and set-off the ticking time bomb between East and West into all-out hostilities?

    Though these two world powers have clashed repeatedly in recent years, there several key factors that make this round extra alarming – and put a peaceful transition into question of exploding into total war, and an undermining force from within the deep state, CIA and shadow government:

    1. Until Donald Trump swears in and settles into the White House, the U.S. remains in a strange air, with an open window for a coup to take place, or a major unforeseen disruption (including something like a terrorist attack). If the deep state wants to start a war which President Trump will be forced to finish, they can. If the deep state wants that same war to block Trump from taking power, or from making major decisions, they will.
    2. With claims that Russia hacked the U.S. election, foreign policy has never been more warlike. Despite lacking evidence, and a politically-heavy spin on events, the powers-that-be intend to drive home the narrative that Putin crossed the line, while Trump is his puppet, and the alternative media his mesmerized “fake news” cheerleaders. This narrative is false, but could fan the flames for war. The new Cold War has been solidified; the aggressive rhetoric in Washington, and highly militarized movements such something big is coming down the pipeline. Though there may not be all out war, tensions will be very high; people will be placed under suspicion; nuclear war and other highly deadly scenarios are on the table like never before. The stage is set for world war three.
    3. Leftists and angry Hillary supporters are revolutionary, if severely misguided. Rosie O’Donnell was only the latest celebrity figure to call for martial law in order to postpone the inauguration, and put Trump on trial. The deep state crew that tags along with Hillary are also quite dangerous – the CIA and shadow advisor types. It is possible that some of these figures are involved in assassinating diplomats, chauffeurs and personal aides close to Putin and his network.
    4. In his final week in office, lame duck Obama could lay an egg that hatches the war. Or, intelligence community figures could go rouge; black ops, a false flag or a successful provocation/antagonization event could trigger a massive kick off to war that no president could simply stop with the stroke of a pen. There is the distinct possibility that if things go hot in a very short span of time, national emergency and outright war will put all other considerations behind them. Gear up for major conflict could be the only way to reset the devastating economic conditions, and the debt bomb that the federal government and federal reserve are prepared to drop on us.
    5. Defensive measures, including setting up anti-missile defense shields has moved inward, encircling Moscow, and those being used in the Ukraine, in Syria and elsewhere along the grand chessboard suggest extremely pugnacious diplomatic gestures – since true diplomacy has frozen up after repeated insult from Washington.

    via the Daily Mail:

    Russia has deployed anti-aircraft missile systems around Moscow to protect the capital from attack in the latest sign Vladimir Putin is preparing for war.

     

    The s-400 Triumph air defence system has been providing air cover for Russian forces in Syria since November, and is now being deployed on home soil.

     

    It is capable of hitting moving airborne targets including planes and incoming missiles and has a range of 400km.

     

    The news has emerged the day the US sent more than 3,000 troops to Poland in response to Nato’s concern Russia was becoming more aggressive.

    via Russia Insider:

    A US armored brigade (3rd Armored Brigade, 4th Infantry Division) is on the move to Russia’s Baltic border. After its equipment begun arriving in Europe last week so now have its soldiers.

     

    The move is so big it will require 37 trains and over one thousand rail cars to transport from Germany to Poland.

     

    A US armored brigade fields over 400 tracked and over 1300 wheeled vehicles including 80 62-ton Abrams tanks, 140 Bradley armored fighting vehicles and 400 humvees.

    There is always saber-rattling and hyperbolic claims of war, but right now is a critical time that will decide the next several decades of U.S. world power.

    Probably, they aren’t going to take any chances, and as desperate as they are, are looking to reignite public support for U.S. struggles abroad – by any means necessary.

    Beware these next few weeks, and remember that the continuity of government “Doomsday” command-and-control planes were brought out after the election as a public show of power to Trump and the American people. The shadow government is real, and for now, maintain dominance.

    This is not the time for games. Constitutional government is in jeopardy; war provocations and assassinations are taking place, and the duly-elected next president of the United States should be very carefully protected, watched over and pray for a peaceful transition.

    We are at risk of entering a very difficult and dangerous time.

  • New York Real Estate Prices Plunge In 4Q As Listing Days and Discounts Soar

    After reviewing the Elliman Report on the New York City Real Estate market at the end of 3Q 2016, we concluded that sellers had simply refused to accept the fact that the Manhattan real estate bubble had burst and rather than dropping prices had decided to simply let their apartments sit on the market unsold while hoping for a miracle.  Here was our conclusion (see “NYC Real Estate Bubble Bursts As Apartment Sales Crash 20%“):

    In conclusion, the lesson seems to be that the marginal New York City buyer has been priced out of the market (volume down 20%) while sellers have not yet accepted that the bubble has burst deciding instead to maintain listing prices while letting their apartments sit on the market longer amid growing inventory levels.  Meanwhile, the luxury market is the only segment that seems to be holding up which only serves to prove that Chinese billionaires still have cash they would like to hide in the U.S.

    Alas, with the release of Elliman’s 4Q 2016 report, it has become apparent that that miracle never materialized for New York’s hedgies and i-bankers.  In fact, the data from Manhattan real estate sales was almost universally bad with median pricing down 8.7% YoY, volume down 3.7%, listing days up 14.6% and discounts up to 5.5%.

    NYC Real Estate

     

    Meanwhile, a view of the longer term sales and pricing trends for Manhattan seems to suggest that the 2013-2015 expansionary period has officially turned.

    NYC Real Estate

     

    As was the case last quarter, the re-sale market was among the hardest hit segments with median prices down 6.3% YoY and volume down 1.5%. 

    NYC Real Estate

     

    Also like previous quarters, the luxury market, despite sinking volumes, is the only segment to continue to show growth in median sales prices.

    NYC Real Estate

     

    And while buyers are abandoning Manhattan en masse, Brooklyn seems to be the key beneficiary with purchases there soaring 22% YoY and median prices climbing 15%.  Per Bloomberg:

    Home buyers in Brooklyn competed for a record-low number of listings in the fourth quarter, driving up prices in the New York borough that’s historically been seen as a refuge from Manhattan’s high costs.

     

    Purchases in Brooklyn rose 22 percent from a year earlier to 2,582, while the median price of those deals climbed 15 percent to a record $750,000, according to a report Thursday by appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate. The number of homes for sale at the end of December tumbled 31 percent to 2,232, the fewest since the firms started keeping the data in 2008.

     

    The sales market in Brooklyn, the city’s most populous borough, is moving in the opposite direction to Manhattan’s, where rising supply is offering buyers more choices and the option to walk away from listings they view as overpriced. Manhattan’s median home price dropped 8.7 percent in the fourth quarter to $1.05 million as sellers awakened to a slowdown after years of holding out for all they could get, the firms said last week.

     

    “You have a disconnect with sellers in Manhattan, and Brooklyn is poaching some of that demand,” Jonathan Miller, president of Miller Samuel, said in an interview. “Overall, it’s generally a lower price point, and affordability has been a big issue the last couple of years.”

    NYC Real Estate

     

    Seems that “Bridge & Tunnel” is starting to have a nice ring to it.

  • Stunning Before And After Pictures Of The California Drought And Devastating Rain Storms

    Just as California’s liberal elites had convinced everyone that climate change had permanently altered global weather patterns such that the entire state was doomed to be stuck in a perpetual drought which would inevitably render it about as inhabitable as the surface of Mars within years, an unrelenting series of storms has struck and in a matter of days filled lakes, overflowed rivers and buried mountains in snow.  And just like that, 40% of California was lifted from a drought that had plagued the state for a decade.

    Of course, that much rain, in such a short period of time, can have devastating consequences as this video from Big Sur illustrates.

     

    As does this dashcam video of a flash flood in norther California. 

     

    In all, the rainfall totals from around Northern California over the past 14 days are staggering with certain areas receiving nearly 2 feet of rain according to SFGate.

    Downtown San Francisco has received 5.53 inches of rain since Jan. 1. The last time the city has seen a number higher than this was 1982 when 7.53 inches fell between Jan. 1 and Jan. 11. During last year’s El Niño year, S.F. had received close to three inches by this date.

     

    More impressive numbers: The coastal range mountains outside Guerneville, where roads and homes went underwater when the Russian River flooded, has received some 21 inches of rain since Jan. 4.

     

    In Downieville, where the Yuba River gushed with a heavy flow all week, some 23 inches of rain were recorded in the past seven days.

     

    And as bad as the flooding has been in parts of Northern California, it would have undoubtedly been even worse but for the the ability to divert some of the excess water into previously depleted reservoirs scattered throughout the state.

    The super soakings have filled reservoirs that were mere mud puddles, their cracked lake beds once exposed at the height of the drought that plagued the state for five-plus years and still persists in many regions, especially in Southern California.

     

    The reservoirs in Northern California have gained some million acres of storage in the past seven days, Michael Anderson, a climatologist with the California Department of Water Resources estimates. And total surface storage for the state is roughly 97 percent of average, with the the total storage for the largest reservoirs being at 111 percent of normal.

     

    Lake Oroville, the state’s second-largest reservoir, gained a bit more than 620,000 acre-feet in the first 10 days of January alone.

     

    “That is almost 18 percent of its capacity,” Anderson said. “Since Oroville was about 750,000 acre-feet below its storage limits during flood season (a consequence of the drought), they can keep all that water for future use and largely offset storage impacts from the drought.”

    Meanwhile, the transformation of the state’s reservoirs, in just a matter of weeks, is astonishing.

    Cali Drought

    Cal

    Cali Drought

    Yuba River

    Cali Drought

    Cali Drought

     

    What a difference a year makes with most reservoirs now near capacity….

    Cali Drought

     

    …versus ~30% of capacity last year.

    Cali Drought

     

    But we’re sure this abundance of rain is ever bit as much due to global warming as the lack of rain was last year…but we’re still waiting for official confirmation on that from our respected political leaders in Sacramento.

  • The US Economy: Back On Track?

    Submitted by Erico Matias Tavares via Sinclair & Co.,

    The weekly rail traffic report published by the Association of American Railroads (“AAR”) provides a great snapshot of US economic activity almost in real (weekly) time.

    Last July we noted that we were starting to witness some signals of a trend change, now suggesting a softening. But much has happened since then, including a broadly unexpected change in the political direction of the US. Have those signals been reversed as a result?

    Let’s start with some general indicators.

    The US ISM Manufacturing Purchasing Managers Index reported by the Institute for Supply Management fell briefly into contraction territory last August, which is often a presage for economic weakness ahead. However, it recovered handsomely in the following months and just printed the highest number in two years.

    A significant reversal to the upside was also observed in the latest National Federation of Independent Business (“NFIB”) Optimism Index for Small Businesses – the real wealth generators in the economy, which after some weakness mid-year just printed the highest level since the Financial Crisis of 2008.

    Not to be outdone, US investors have pushed equities to new historical highs, as shown in the graph above (by finviz.com).

    So things are looking up in the US right? Perhaps so… but the railroads aren’t feeling it.

    Rail intermodal traffic registers the long-haul movement of shipping containers and truck trailers by rail whenever combined with (a much shorter) truck movement at one or both ends. It covers a broad range of goods that Americans consume regularly, from laptops to frozen chickens, and is thus a great indicator of how consumers are doing. Given the huge importance of consumption for the US economy as a whole, for us this is the most revealing category.

    The grey cloud in our rail shipment graphs (in units) depicted henceforth shows the maximum and minimum volume range recorded for the same week over the five years prior (2011-2015). The green line shows the readings for 2016, now for the full year.

    After a strong start of the year, rail intermodal traffic started to underperform, although some pickup was observed later in the year. Aggregating the numbers by year provides a clearer picture, and here are the figures since 2006 (in MM units):

    For the first time since the lead up to the 2009 recession, yearly values are down versus the prior year. In percentage terms the 2015-16 decline is almost the same as the 2007-08 decline, when the Financial Crisis was raging.

    While clearly not a good sign this is just a warning given the still high transactional levels compared to prior years. If weakness persists in this category into 2017 then we will start getting really, really worried about the broader condition of the US economy.

    What about housing, another key industry? The forest products category includes lumber, a major input of house construction, and is shown in the graph below:

    Volumes were generally weak throughout the year, setting new five year lows. However, as per US Census Bureau data privately-owned housing completions in November came out at a very solid 15% (±13.5%) above the revised October estimate and a whopping 25% (±15.0%) over the prior year. How can these two seemingly disparate trends be reconciled?

    The answer might be in the brackets after the percentage growth figures. These statistics are estimated from sample surveys, so the Census Bureau provides a standard error to indicate a range where the real number might actually lie. And quite a wide one in fact. As such, the actual year-on-year figure could be somewhere in the range +10% to +40%. Given falling volumes transported by the railways even the lower estimate from these surveys looks optimistic. Another category to keep a close eye on.

    The motor vehicles and parts graph shown below includes all sorts of vehicles (used and new), passenger car and bus bodies, parts and accessories and other related equipment:

    This industry is of course very important for US manufacturing. Last July we noted that it had been the bright spot out of all the categories, recording new cycle highs up until then. And while that persisted for a while longer some weakness sipped in towards the end of the year.

    Still, volumes reached the highest level in 2016 since the go-go days of 2007. Not bad at all, but hopefully that year-end weakness is nothing to worry about… because as we shall see other industries – particularly in the primary sector – continue to struggle.

    After a terrible performance through 2015, metallic ores (shown above), which include all kinds of ores (iron, copper, lead, zinc and so forth) and waste scrap, managed to do even worse in 2016. Not much reason for optimism here (unless as a contrarian).

    The same can be said about coal, with volumes collapsing since the start of the year. Not even the recovery in the second half could avoid a miserable performance overall.

    What about oil production?

    Using rail shipments of crude oil and refined products to gauge production levels is a little tricky because volumes can be diverted to pipelines and/or the mix can change. That being said, the declines in rail shipments throughout 2016 are consistent with the drop in US production as reported by the IEA, shown in the graph below (in MM bopd):

    The silver lining is that the weekly oil rig count as reported by Baker Hughes has responded positively to the recent recovery in crude oil prices, as shown in the graph below (with WTI pushed forward a number of weeks):

    So we may see some pickup in activity going forward, as long as prices continue to hold. Other than that it’s pretty safe to say that the US extractive sector as a whole had another miserable year.

    And last but certainly not least, here are the rail shipments of grains:

    Volumes exploded higher in the second half of the year. The flipside of such volume increases was a continued correction in grain prices, particularly in corn and wheat (soybeans managed to hold up). Great news for consumers, but terrible for farmers: according to the latest USDA estimates in 2016 net farm income dropped to the lowest level in six years.

    ***

    If so many industries continued to struggle in 2016, with some key ones even deteriorating towards year-end, how come small businesses are so wildly optimistic?

    Perhaps the graph above, taken from the same NFIB small business report, provides the answer: while actual sales have languished expectations of future activity have gone through the roof. And that differential between actual versus expectations reached the highest level in many years.

    It is hard to dissociate this from all the economic promises of the incoming Administration. That may explain why small business owners across the US – and indeed stock investors – have become so optimistic. However, the hard goods-traded reality continues to show some concerning signs of weakness.

    Whether or not the new economic policies will prove to be successful the railways will likely feel it before anyone else. That’s why we will continue to keep an eye on the data.

    And with that, here’s our economic wish for 2017: Make Railways Great Again!

     

  • Artist's Impression Of Obama's Farewell Address

    “King of the world…”

     

    Source: MichaelPRamirez.com

  • Why Ridiculous Official Propaganda Still Works

    Submitted by CJ Hopkins via Counterpunch.org,

    For students of official propaganda, manipulation of public opinion, psychological conditioning, and emotional coercion, it doesn’t get much better than this. As Trump and his army of Goldman Sachs guys, corporate CEOs, and Christian zealots slouch toward inauguration day, we are being treated to a master class in coordinated media manipulation that is making Goebbels look like an amateur. This may not be immediately apparent, given the seemingly risible nature of most of the garbage we are being barraged with, but once one understands the actual purpose of such official propaganda, everything starts to make more sense.

    Chief among the common misconceptions about the way official propaganda works is the notion that its goal is to deceive the public into believing things that are not “the truth” (that Trump is a Russian agent, for example, or that Saddam had weapons of mass destruction, or that the terrorists hate us for our freedom, et cetera). However, while official propagandists are definitely pleased if anyone actually believes whatever lies they are selling, deception is not their primary aim.

    The primary aim of official propaganda is to generate an “official narrative” that can be mindlessly repeated by the ruling classes and those who support and identify with them. This official narrative does not have to make sense, or to stand up to any sort of serious scrutiny. Its factualness is not the point. The point is to draw a Maginot line, a defensive ideological boundary, between “the truth” as defined by the ruling classes and any other “truth” that contradicts their narrative.

    Imagine this Maginot line as a circular wall surrounded by inhospitable territory. Inside the wall is “normal” society, gainful employment, career advancement, and all the other considerable benefits of cooperating with the ruling classes. Outside the wall is poverty, anxiety, social and professional stigmatization, and various other forms of suffering. Which side of the wall do you want to be on? Every day, in countless ways, each of us are asked and have to answer this question. Conform, and there’s a place for you inside. Refuse, and … well, good luck out there.

    In openly despotic societies, the stakes involved in making this choice (to conform or dissent) are often life and death. In our relatively liberal Western societies (for those of us who are not militant guerillas), the consequences of not conforming to the official narrative are usually subtler. Despite that, the pressure is still intense. Conforming to the consensus “reality” generated by these official narratives is price of admission to the inner sanctum, where the jobs, money, professional prestige, and the other rewards of Capitalism are. Conforming does not require belief. It requires allegiance and rote obedience. What one actually believes is completely irrelevant, as long as one parrots the official narrative.

    In short, official propaganda is not designed to deceive the public (no more than the speeches in an actor’s script are intended to deceive the actor who speaks them). It is designed to be absorbed and repeated, no matter how implausible or preposterous it might be. Actually, it is often most effective when those who are forced to robotically repeat it know that it is utter nonsense, as the humiliation of having to do so cements their allegiance to the ruling classes (this phenomenon being a standard feature of the classic Stockholm Syndrome model, and authoritarian conditioning generally).

    The current “Russian hacking” hysteria is a perfect example of how this works. No one aside from total morons actually believes this official narrative (the substance of which is beyond ridiculous), not even the stooges selling it to us. This, however, is not a problem, because it isn’t intended to be believed … it is intended to be accepted and repeated, more or less like religious dogma. (It doesn’t matter what actually happened, i.e., whether the “hack” was a hack or a leak, or who the hackers or leakers were, or who they may have been working for, or what whoever’s motives may have been. What matters is that the ruling classes have issued a new official narrative and are demanding that every “normal” American stand up and swear allegiance to it.)

    The ruling classes are not exactly making it easy for their followers this time. Their new official narrative (let’s go ahead and call it “The Putinist Putsch to Destroy Democracy”) is so completely fatuous that it’s beyond embarrassing. The plot is more or less what you’d expect from a mediocre young adult novel or a Game of Thrones-type fantasy series. And if that wasn’t already humiliating enough for the liberals being asked to pretend to believe it, the PR folks in charge couldn’t even be bothered to assemble a new collection of liars to market their childish fairy tale for them. Not only are they insisting that liberals take the word of the “Intelligence Community” and the mainstream media that sold the world the “Saddam Has Secret WMDs” hoax, they actually dispatched James R. Clapper to sit there, in more or less the same spot he sat in the last time he lied to Congress, and do his dog and pony show again.

    Meanwhile, the ruling classes’ papers of record, which cosmopolitan liberals rely on to provide a simulation of “serious journalism,” highbrow “arts and culture,” and so on, have descended to the level of the National Enquirer. Among the recent highlights was The Washington Post‘s “Russians Hacked the Vermont Power Grid” story, which it turned out involved neither Russians nor hackers, nor the Vermont power grid’s actual computers, and was basically just another made-up story, like the one about Putin’s Fake News Army. The New York Times, which has also been dutifully rolling out the new official narrative, has taken the leash off Charles M. Blow (aka “The Withering Gaze”), who is accusing Trump of being Russia’s appointment” and proclaiming his election “an act of war.” And now, as I was writing this piece, they hit us with the “Golden Showers” story, in which Trump paid a bunch of Russian hookers to pee on the bed where Obama slept. Any day now we are going to be told that Elvis is secretly working with Putin to deploy a Zhirinovskian gravitational weapon in a UFO disguised as Jesus that Assange and Snowden will personally pilot across the Atlantic to sink America. It’s like some kind of loyalty test in which the ruling classes are trying to determine just how far they can go with this crap before liberals refuse to salute any more of it.

    The point of all this propaganda is to delegitimize Donald Trump, and to prophylactically reassert the neoliberal ruling classes’ monopoly on power, “reality,” and “truth.” In case this wasn’t already abundantly clear, the neoliberal ruling classes have no intention of giving up control of the global capitalist pseudo-empire they’ve been working to establish these last sixty years. They’re going to delegitimize and stigmatize Trump (and any other symbol of nationalist backlash or resistance to transnational Capitalism), bide their time for the next four years, and then install another of their loyal servants … after which life will go back to “normal,” and liberals will do their best to forget this unfortunate period where they pretended to believe this insipid neo-McCarthyite nonsense.

    If I wasn’t worried that Trump is going to launch an all-out War on Islam, or that one of “our boys” in the tanks Obama has theatrically ordered to the Russian border was going to go bonkers and try to “git some” for Clinton, I’d be looking forward to seeing just how batshit crazy it’s going to get.

  • "China's Next Time Bomb" – A Look Inside The Insane World Of China's Bitcoin Traders

    The recent tumble in bitcoin, driven by a stampede of Chinese sellers who until last week were willing buyers at any price, has exposed the weakest link in bitcoin’s until recently exponential rise: the mood and social psychology of Chinese momentum and bubble chasers, who like clockwork rush into any one given asset, bid it up to ridiculous levels, watch the bubble burst, before moving on to the next bubble.

    The good news is that courtesy of $25 trillion in local savings, or more than double the amount in the US, the bubble eventually returns to where it burst. The bad news is that in the meantime, those who chased the original bubble lose most if not all of their money.

    Unfortunately, for most of China’s bitcoin traders, the bad news may be just starting.

    Take the story of Ding Wen, who by the age of 34 had built up a personal fortune of more than two million yuan after years of hard work at an internet company in Nanjing, in east China’s Jiangsu province. But, as SCMP recounts his tale, Wen saw most of that wealth go up in smoke on January 5, when China’s bitcoin market crashed, sending the price of the virtual currency plunging 40 per cent in just a few hours after lunch.

    With the market in free fall, Ding was unable to log into his account with China’s biggest bitcoin trading platform, Huobi, meaning he could not sell off his holdings or top up his principal to meet the margin call. By the time he managed to log on in the evening, most of the bitcoins in his account had been compulsorily sold off by Huobi for 6,361 yuan each, lower than his purchase price of 8,101 yuan. This included the part of his investment he had bought using a loan he obtained from Huobi by pledging the bitcoins he owned originally.

    “I have taken on big risks when making leveraged betting, but the collapse of the trading system made me unable to run stop-loss orders, so I think the platform should compensate for investors’ losses,” Ding said.

    The platform disagrees.

    Ahead of the market crash, Ding had borrowed 995 million yuan from Huobi by pledging a principal consisting of the 409 bitcoins he already owned. He then bought a further 1,228 bitcoins with the loan. Most of his holdings were compulsorily sold out by Huobi during the price collapse while he was unable to access his account.

    Meanwhile, Wu Xing, head of marketing at Huobi, said the log-in delay was caused by a torrent of visits and selling orders, which exceeded the capacity of the website. “[The loss] was due to irresistible factors and not included in the compensation scope. We are sorry and understand the feelings of the investors,” she said.

    So to recap… trading the extremely volatile bitcoin on massive, unregulated margin, in an exchange that arbitrarily locks out its clients? 

    What can possibly go wrong.

    * * *

    According to SCMP, “many analysts and investors fear China’s bitcoin market is quickly turning into another time bomb like the scandal-hit peer-to-peer (P2P) lending sector. A series of P2P lending platform frauds rocked the country last year and washed away tens of billions of yuan of investment from small investors, creating a headache for local and central governments, which feared social unrest.”

    Now speculation, derivative products, leveraged betting and program trading appear to be spreading in the largely unregulated bitcoin market. Such practices are thought to be responsible for pushing up the price of bitcoin by more than 260 per cent since early 2016.

    The market hit a historic high of 8,995 yuan on January 5… Just ahead of the crash.

     

    Most of the transactions are happening on three privately owned platforms or through P2P trading.

    Data provider Bitcoinity shows trading volume in China accounted for more than 98% of the global total during the past 30 days amid more pronounced price fluctuations. Until now, no regulator has overseen this market, which sees daily turnover worth tens of billions of yuan. However, things appear to be changing fast.

    After the great bitcoin crash, the People’s Bank of China announced on Wednesday afternoon that it had sent inspection teams to the country’s top three bitcoin trading platforms to scrutinise their practices. It is the first regulatory move China’s central bank has made publicly involving the virtual currency.

    The PBOC has been in talks with the platforms from time to time in private since 2013 and asked them for data and information, according to an executive from a major trading platform, who asked not to be named. But the authorities have not formally listed bitcoin under their regulatory framework. Nor have they issued any rules to govern the market.

    Like all other central banks, the PBOC defines bitcoin as a commodity rather than a currency, which ruled it out of their existing regulatory coverage in late 2013. Aurélien Menant, founder and chief executive of Gatecoin, a cryptocurrency and blockchain assets trading platform based in Hong Kong, said: “Given the dominant role of Chinese exchanges, which represent 95 per cent of global bitcoin trading activity, at more than 50 billion yuan every day, it’s likely that the PBOC recognises the growing significance of this new and so far unregulated alternative financial market.

    “The PBOC has been engaging with the major cryptocurrency exchanges in China for several years, but given the sudden price movements and high volumes traded over the past few weeks, it’s very clear that now it just wanted to step up their checks on market manipulation and money laundering.”

    In an announcement issued on Wednesday, the central bank said it was joining forces with the Beijing Financial Bureau to probe trading platforms including Huobi and OKCoin to check if they were running in accordance with foreign-exchange management, anti-money-laundering and trading exchange rules.

    Mainland media reported in recent months that bitcoins had become a popular tool for investors to export money out of China, circumventing capital controls that had been tightened by the regulators amid the yuan’s sharp depreciation. Cheung Chun-yin, a PwC China fintech partner, said it was possible for bitcoin holders in China to circumvent domestic capital control limits by selling bitcoin to an overseas buyer in exchange for foreign currency.

    “In theory, the bitcoin market is borderless, and as long as you could find a buyer overseas, you would be able to get US dollars, and the trade could happen without leaving a trace, with no record in the traditional banking system,” he said, adding that the volume of capital flow through this channel was likely to be quite limited.

    Feeling attacked, the local industry quickly rose up in defense. Zhao Dong, owner of Jiandong Tech, a company that buys and sells bitcoin, agreed that the actual amount of capital leaving the country through bitcoin was not likely to be very high.

    “Among the 16 million bitcoins already dug out across the world by now, there are around four to five million held by the Chinese. That already caps the total value, while most of the owners are more interested in short-term speculation on the mainland market than exporting them for foreign currencies,” he said. Cheung said that although neither the mainland nor Hong Kong financial regulators had included bitcoin in the existing regulatory framework, bitcoin-related activities were “evolving and bearing the features of traditional financial market activities” and overlapping with the traditional financial system. That makes it more important than ever that the regulators start to take notice.

    The biggest problem for the Chinese bitcoin market, according to Zhao, is that “the trading platforms are facing the challenge of having to prove themselves innocent” because many investors accuse them of inside trading or market manipulation. The market boom and the quick build-up of leverage had left the market in urgent need of official regulation, he said. Chen Yunfeng, a senior partner with Zhonglun W&D law firm, based in Shanghai, said he was dealing with an increasing number of bitcoin-related disputes. These included cases of bitcoin theft and scams in which investors have been unable to verify their trading partners.

    “The bitcoin market is facing great risks, with turnover and leverage climbing quickly, and mixed up with unregulated foreign-currency trading and money laundering. I think it is time that the PBOC prepared new policies,” he added.

    Industry players said the PBOC was mulling the idea of introducing third-party custodian services to govern the market by taking care of the account records, cash or bitcoins on behalf of the platforms. In early August, investor confidence in bitcoin took another knock when Bitfinex, a prominent Hong Kong-based digital currency exchange, reported the theft of about US$65.8 million worth of bitcoins. About 119,756 bitcoins were lost in a security breach, the company said.

    In early 2014, Japan-based bitcoin exchange MtGox collapsed over the loss of nearly US$390 million worth of the virtual currency. Police later arrested its chief executive, Mark Karpeles, who was suspected of having accessed the computer system of the exchange and falsifying data on its outstanding balance.

    * * *

    Meanwhile, overnight BTCChina announced (and other exchanges allegedly followed) that it had suspended its margin loan service indefinitely. The move came after the exchange received “informal guidance” from the PBoC, which has been more actively engaged with domestic bitcoin exchanges amid the run-up in bitcoin prices seen at the start of the year.  While the move may flush out much of the bubbly euphoria, it may also lead to a far more stable market.

    Alternatively, it may just accelerate the blow up of China’s “bitcoin time bomb.”

  • Some Election Interference Is More Equal Than Others – How Ukraine Meddled On Behalf Of Clinton

    Submitted by Mike Krieger via Liberty Blitzkrieg blog,

    A couple of days ago, Politico published a fascinating piece describing how factions associated with the current Ukrainian government apparently interfered in the U.S. election on behalf of Hillary Clinton. The findings seem pretty damning, and certainly warrant at least some conversation within the American media given the 24/7 obsession with Russia. Nevertheless, most of you have probably never heard of this saga, since when it comes to the corporate media news cycle, some election interference is more equal than others.

    The article is lengthy, and can be confusing at times given all the moving parts, but I highly encourage you to read it. Ukrainian interference in the election can be traced to essentially two sources. First, there was the apparent collaboration between the Ukrainian embassy in Washington D.C. and a highly paid Ukrainian-American DNC consultant, Alexandra Chalupa. The second angle is far more disturbing, and involves the publicization of a so-called ledger demonstrating corruption between Paul Manafort and pro-Russian elements in Ukraine, by a parliamentarian named Serhiy Leshchenko. Bizarrely, the investigation was effectively dropped after Trump won the election, making you wonder if there was anything really there in the first place.

    What follows are excerpts from the excellent piece, Ukrainian Efforts to Sabotage Trump Backfire:

    Donald Trump wasn’t the only presidential candidate whose campaign was boosted by officials of a former Soviet bloc country.

     

    Ukrainian government officials tried to help Hillary Clinton and undermine Trump by publicly questioning his fitness for office. They also disseminated documents implicating a top Trump aide in corruption and suggested they were investigating the matter, only to back away after the election. And they helped Clinton’s allies research damaging information on Trump and his advisers, a Politico investigation found.

     

    A Ukrainian-American operative who was consulting for the Democratic National Committee met with top officials in the Ukrainian Embassy in Washington in an effort to expose ties between Trump, top campaign aide Paul Manafort and Russia, according to people with direct knowledge of the situation.

     

    The Ukrainian efforts had an impact in the race, helping to force Manafort’s resignation and advancing the narrative that Trump’s campaign was deeply connected to Ukraine’s foe to the east, Russia. But they were far less concerted or centrally directed than Russia’s alleged hacking and dissemination of Democratic emails.

     

    Politico’s investigation found evidence of Ukrainian government involvement in the race that appears to strain diplomatic protocol dictating that governments refrain from engaging in one another’s elections.

     

    The Ukrainian antipathy for Trump’s team — and alignment with Clinton’s — can be traced back to late 2013. That’s when the country’s president, Viktor Yanukovych, whom Manafort had been advising, abruptly backed out of a European Union pact linked to anti-corruption reforms. Instead, Yanukovych entered into a multibillion-dollar bailout agreement with Russia, sparking protests across Ukraine and prompting Yanukovych to flee the country to Russia under Putin’s protection.

     

    In the ensuing crisis, Russian troops moved into the Ukrainian territory of Crimea, and Manafort dropped off the radar.

     

    Manafort’s work for Yanukovych caught the attention of a veteran Democratic operative named Alexandra Chalupa, who had worked in the White House Office of Public Liaison during the Clinton administration. Chalupa went on to work as a staffer, then as a consultant, for Democratic National Committee. The DNC paid her $412,000 from 2004 to June 2016, according to Federal Election Commission records, though she also was paid by other clients during that time, including Democratic campaigns and the DNC’s arm for engaging expatriate Democrats around the world.

     

    She said she shared her concern with Ukraine’s ambassador to the U.S., Valeriy Chaly, and one of his top aides, Oksana Shulyar, during a March 2016 meeting at the Ukrainian Embassy. According to someone briefed on the meeting, Chaly said that Manafort was very much on his radar, but that he wasn’t particularly concerned about the operative’s ties to Trump since he didn’t believe Trump stood much of a chance of winning the GOP nomination, let alone the presidency.

     

    Chalupa said the embassy also worked directly with reporters researching Trump, Manafort and Russia to point them in the right directions. She added, though, “they were being very protective and not speaking to the press as much as they should have. I think they were being careful because their situation was that they had to be very, very careful because they could not pick sides. It’s a political issue, and they didn’t want to get involved politically because they couldn’t.”

     

    Shulyar vehemently denied working with reporters or with Chalupa on anything related to Trump or Manafort, explaining “we were stormed by many reporters to comment on this subject, but our clear and adamant position was not to give any comment [and] not to interfere into the campaign affairs.”

     

    Shulyar said her work with Chalupa “didn’t involve the campaign,” and she specifically stressed that “We have never worked to research and disseminate damaging information about Donald Trump and Paul Manafort.”

     

    But Andrii Telizhenko, who worked as a political officer in the Ukrainian Embassy under Shulyar, said she instructed him to help Chalupa research connections between Trump, Manafort and Russia. “Oksana said that if I had any information, or knew other people who did, then I should contact Chalupa,” recalled Telizhenko, who is now a political consultant in Kiev. “They were coordinating an investigation with the Hillary team on Paul Manafort with Alexandra Chalupa,” he said, adding “Oksana was keeping it all quiet,” but “the embassy worked very closely with” Chalupa.

     

    In fact, sources familiar with the effort say that Shulyar specifically called Telizhenko into a meeting with Chalupa to provide an update on an American media outlet’s ongoing investigation into Manafort.

     

    Telizhenko recalled that Chalupa told him and Shulyar that, “If we can get enough information on Paul [Manafort] or Trump’s involvement with Russia, she can get a hearing in Congress by September.”

    Sure seems like pretty close coordination between a DNC consultant and the official embassy of Ukraine in the midst of a Presidential election.

    Nevertheless, that’s small potatoes compared to what happened within the Ukrainian parliament itself. As Politico notes:

    While it’s not uncommon for outside operatives to serve as intermediaries between governments and reporters, one of the more damaging Russia-related stories for the Trump campaign — and certainly for Manafort — can be traced more directly to the Ukrainian government.

     

    Documents released by an independent Ukrainian government agency — and publicized by a parliamentarian — appeared to show $12.7 million in cash payments that were earmarked for Manafort by the Russia-aligned party of the deposed former president, Yanukovych.

     

    The New York Times, in the August story revealing the ledgers’ existence, reported that the payments earmarked for Manafort were “a focus” of an investigation by Ukrainian anti-corruption officials, while CNN reported days later that the FBI was pursuing an overlapping inquiry.

     

    Clinton’s campaign seized on the story to advance Democrats’ argument that Trump’s campaign was closely linked to Russia. The ledger represented “more troubling connections between Donald Trump’s team and pro-Kremlin elements in Ukraine,” Robby Mook, Clinton’s campaign manager, said in a statement. He demanded that Trump “disclose campaign chair Paul Manafort’s and all other campaign employees’ and advisers’ ties to Russian or pro-Kremlin entities, including whether any of Trump’s employees or advisers are currently representing and or being paid by them.”

     

    A former Ukrainian investigative journalist and current parliamentarian named Serhiy Leshchenko, who was elected in 2014 as part of Poroshenko’s party, held a news conference to highlight the ledgers, and to urge Ukrainian and American law enforcement to aggressively investigate Manafort.

     

    “I believe and understand the basis of these payments are totally against the law — we have the proof from these books,” Leshchenko said during the news conference, which attracted international media coverage. “If Mr. Manafort denies any allegations, I think he has to be interrogated into this case and prove his position that he was not involved in any misconduct on the territory of Ukraine,” Leshchenko added. 

    These are some really serious allegations, which makes his current behavior, which I’ll highlight later, that much more concerning.

    Manafort denied receiving any off-books cash from Yanukovych’s Party of Regions, and said that he had never been contacted about the ledger by Ukrainian or American investigators, later telling POLITICO “I was just caught in the crossfire.”

     

    The scrutiny around the ledgers — combined with that from other stories about his Ukraine work — proved too much, and he stepped down from the Trump campaign less than a week after the Times story.

     

    At the time, Leshchenko suggested that his motivation was partly to undermine Trump. “For me, it was important to show not only the corruption aspect, but that he is [a] pro-Russian candidate who can break the geopolitical balance in the world,” Leshchenko told the Financial Times about two weeks after his news conference. The newspaper noted that Trump’s candidacy had spurred “Kiev’s wider political leadership to do something they would never have attempted before: intervene, however indirectly, in a U.S. election,” and the story quoted Leshchenko asserting that the majority of Ukraine’s politicians are “on Hillary Clinton’s side.”

    Well, well, well…but there’s more.

    An operative who has worked extensively in Ukraine, including as an adviser to Poroshenko, said it was highly unlikely that either Leshchenko or the anti-corruption bureau would have pushed the issue without at least tacit approval from Poroshenko or his closest allies.

     

    “It was something that Poroshenko was probably aware of and could have stopped if he wanted to,” said the operative.

     

    And, almost immediately after Trump’s stunning victory over Clinton, questions began mounting about the investigations into the ledgers — and the ledgers themselves.

     

    An official with the anti-corruption bureau told a Ukrainian newspaper, “Mr. Manafort does not have a role in this case.”

     

    And, while the anti-corruption bureau told Politico late last month that a “general investigation [is] still ongoing” of the ledger, it said Manafort is not a target of the investigation. “As he is not the Ukrainian citizen, [the anti-corruption bureau] by the law couldn’t investigate him personally,” the bureau said in a statement.

    Note that the only thing that changed is Trump won the election, which apparently caused the Ukrainian government to backtrack on the entire thing after its sabotage failed to deliver the desire outcome.

    Some Poroshenko critics have gone further, suggesting that the bureau is backing away from investigating because the ledgers might have been doctored or even forged.

     

    And in an interview this week, Manafort, who re-emerged as an informal advisor to Trump after Election Day, suggested that the ledgers were inauthentic and called their publication “a politically motivated false attack on me. My role as a paid consultant was public. There was nothing off the books, but the way that this was presented tried to make it look shady.”

    As shameless as all of this is, it doesn’t end there.

    Poroshenko’s allies are scrambling to figure out how to build a relationship with Trump, who is known for harboring and prosecuting grudges for years.

     

    A delegation of Ukrainian parliamentarians allied with Poroshenko last month traveled to Washington partly to try to make inroads with the Trump transition team, but they were unable to secure a meeting, according to a Washington foreign policy operative familiar with the trip. And operatives in Washington and Kiev say that after the election, Poroshenko met in Kiev with top executives from the Washington lobbying firm BGR — including Ed Rogers and Lester Munson — about how to navigate the Trump regime.

     

    Weeks later, BGR reported to the Department of Justice that the government of Ukraine would pay the firm $50,000 a month to “provide strategic public relations and government affairs counsel,” including “outreach to U.S. government officials, non-government organizations, members of the media and other individuals.”

    The fact that foreign influence is purchased like this is simply disgusting, but I digress.

    In fact, I’ve saved the best for last…

    The Poroshenko regime’s standing with Trump is considered so dire that the president’s allies after the election actually reached out to make amends with — and even seek assistance from — Manafort, according to two operatives familiar with Ukraine’s efforts to make inroads with Trump.

    After essentially claiming that Manafort was a hired gun for Putin to intervene in the internal affairs of Ukraine, the government is now reaching out to him? You don’t have to be Sherlock Holmes to see something’s not adding up here. Was the entire investigation a fraud to help Hillary Clinton win the election? If so, isn’t that election interference?

    Nevertheless, I somehow I doubt we’ll see America’s three stooges, Graham, Rubio and McCain make a big stink over this one.

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Jan 13

Today’s News 13th January 2017

  • Why Has The White House Suddenly Released A Strategy For Dealing With A Catastrophic Meteor Impact?

    As SHTFPlan.com's Mac Slavo notes, we should take notice at the government preparations for disaster, and the possibility of a cataclysmic collision with damaging objects in space.

    At the same time, we should take notice at what they are preparing for with all the billions of dollars thrown at defense and survival, it comes in secretive infrastructure for a reclusive sect of power, and in top-down plans to contain the unrest.

     

    Preparations for the individual to survive, and be resilient are not being put in place in this government, though many other governments have made such an investment into the lives of individuals. Time and again, these people are told to brace for the worst, with little to show for it. A few have made their preps, and it may yet prove useful in this or some other disaster.

    Why Has The White House Suddenly Released A Strategy For Dealing With The Threat Of A Catastrophic Meteor Impact?

    Authored by The End Of The American Dream's Michael Snyder,

    Does the White House know something that the rest of us do not? As the Obama administration draws to a close, the White House has suddenly released a major document that details a multi-pronged strategy for dealing with the threat of a catastrophic meteor impact. Most of us remember movies such as “Deep Impact” and “Armageddon” that attempted to depict what such a crisis would look like, but up until fairly recently the U.S. government has never seemed to take this kind of threat very seriously.

    So what has changed?

    Of all the things that the White House could be focusing on, why this?

    And this new report is just the latest in a series of measures that the government has taken over the past couple of years to help prepare us for incoming meteors and asteroids. The following is an excerpt from a recent Gizmodo article…

    Concern over an apocalyptic asteroid strike has risen all the way to the top: The White House released a document this week detailing a strategy for National Near Earth Object (NEO) preparedness. Morgan Freeman would no doubt be proud, although honestly, the nation might have more pressing apocalypse concerns closer to home.

     

    Last year brought renewed interest in handling humanity-ending impact events. After a 2014 audit showed that NASA had a cruddy NEO preparedness system, the agency founded a new Planetary Defense Coordination Office (PDCO) last year to detect all of our potentially nasty NEO neighbors. The office quickly escalated talk to action, running preparedness drills with the Federal Emergency Management Agency (FEMA), launching spacecraft to gather asteroid information, and even drawing up plans to nuke the bad boys out of the sky if things get dicey.

    NASA continues to assure us that no threat is imminent, so why spend so much time, energy and resources on a non-existent crisis?

    If you want to read the 25 page document that the White House just released, it is entitled “National Near-Earth Object Preparedness Strategy” and you can read it for yourself right here.

    The document was put together by the Interagency Working Group for Detecting and Mitigating the Impact of Earth-bound Near-Earth Objects, and it outlined seven key objectives that the authors believe are important…

    1. Enhance NEO detection, tracking, and characterization capabilities
    2. Develop methods for NEO deflection and disruption
    3. Improve modelling, predictions, and information integration
    4. Develop emergency procedures for NEO impact scenarios
    5. Establish NEO impact response and recovery procedures
    6. Leverage and support international cooperation
    7. Establish coordination and communications protocols and thresholds for taking action

    And without a doubt, we definitely do need to enhance our detection abilities. Just the other day, a very large asteroid barely missed us, and we had only discovered it two days earlier…

    Early Monday morning, while the US East Coast was pouring coffee, dropping kids off at school, and cursing in traffic, a space rock as big as a 10-story building slipped past Earth.

     

    The asteroid, dubbed 2017 AG13, was discovered only Saturday by the University of Arizona’s Catalina Sky Survey, according to an email from Slooh, a company that broadcasts live views of space.

    We were very fortunate this time, but the truth is that our planet crosses paths with other giant space rocks on a very regular basis.

    In fact, a near-Earth object that is being called “a cross between an asteroid and a comet” will come fairly close to our planet in February…

    The latter “object”, dubbed the 2016 WF9, was detected by NASA in late November and has left scientist’s scratching their heads.

     

    They have described the celestial rock as a cross between an asteroid and a comet.

     

    It’s in the middle of its of.9 year orbit between Jupiter and Earth and will approach us on February 25, flying by at a distance of 32million miles from the planet.

    Currently, approximately 10,000 major near-Earth objects have been identified by scientists, and about 10 percent of them are one kilometer or larger in size.

    If one of those monsters directly hit our planet, we truly would be facing an extinction-level event.

    For example, just imagine the kind of devastation that would happen if a large asteroid or meteor hit the Atlantic Ocean. Tsunami waves hundreds of feet tall would be sent racing toward the coasts of North America, South America, Africa and western Europe, and millions upon millions of people would die.

    This is something that scientists have actually studied. According to a study conducted at the University of California at Santa Cruz, if a giant meteor did strike the Atlantic Ocean we could potentially see tsunami waves as high as 400 feet slam into the east coast of the United States…

    If an asteroid crashes into the Earth, it is likely to splash down somewhere in the oceans that cover 70 percent of the planet’s surface. Huge tsunami waves, spreading out from the impact site like the ripples from a rock tossed into a pond, would inundate heavily populated coastal areas. A computer simulation of an asteroid impact tsunami developed by scientists at the University of California, Santa Cruz, shows waves as high as 400 feet sweeping onto the Atlantic Coast of the United States.

    Depending on where the meteor strikes, we could potentially see New York City, Boston, Philadelphia, Baltimore, Washington D.C., Charleston, Miami and countless other major coastal cities all wiped out on a single day.

    Right now, 39 percent of all Americans live in a county that directly borders a shoreline.

    To say that we are vulnerable to a massive tsunami caused by a meteor impact would be a massive understatement.

    And scientists assure us that it will happen someday. In fact, I don’t know if you have noticed, but our area of space seems to have a lot more “traffic” in it these days. NASA tells us that there is nothing to be worried about, but others are concerned that something may be coming toward us or that we are moving toward something.

    Ultimately, we need to remember that we are essentially a speck of dust hurtling through a massive galaxy at incredibly high speeds, and our galaxy is only an extremely small part of an absolutely enormous and ever changing universe.

  • Mexican Drug Cartels Looting State-Owned Gas Pipelines For Black Market Sales

    A couple of weeks ago we highlighted the protests that had engulfed Mexico after the finance ministry announced plans to raise gasoline prices by 20.1% starting January 1st.  Amid the chaos, the country’s powerful Jalisco New Generation cartel threatened to to burn down gas stations as retribution for taking advantage of “the majority of the people who don’t make even a minimum wage.”

    But before readers blow this off as just another protest by an angry population which fails to grasp the “global deflationary collapse” while focusing on “fringe, outlier events”  – at least in the words of central bankers –  things suddenly got serious when none other than the country’s powerful Jalisco New Generation cartel has entered the fray, threatening to burn gas stations in response to the price hikes, according to Jalisco authorities cited by TeleSur.

     

    “They are speculating in order to obtain million dollar profits from the majority of the people who don’t make even a minimum wage, we have already realized that the (shortage) of fuel is because dealers don’t want to sell fuel unless they can do so at a profit, all of our people are now ready to start the mission,” the Mexican drug cartel stated in a WhatsApp message circulating in Jalisco.

     

    “The CJNG, in support of the working class, commits itself to making burn all the gasoline stations that to December 30 of the current year, at 10:00 p.m.” — before the price increases go into effect — “have not normalized the sale of fuel at the fair price,” the message said, according to the Mexican news outlet Aristegui Noticias.

    Gas Looting

     

    Alas, after the knee jerk reaction to riot subsided, which would have only resulted in gas prices soaring even higher anyway, Mexico’s drug cartels did what any clever black market entrepreneurial organization would do:  they decided to steal the gasoline and sell it themselves.  With a modest upfront capital investment of $5,000 – $8,000, the cartels have realized they can tap directly into state-owned gas pipelines and withdraw seemingly unlimited supplies of gasoline which they then sell along the highway at a discount to official government prices.  It’s a win-win situation whereby the drug cartels make 100% profit margins and citizens get “cheap” fuel.

    The black market is booming. Several states experienced gasoline shortages at the end of last year as more thieves tapped into state-owned Petróleos Mexicanos (Pemex) pipelines. The pilfered fuel was sold to drivers hoping to save money. Pipeline theft in 2015 increased sevenfold, to more than 5,500 taps, from just 710 in 2010. Pemex attributes the company’s 12-year slide in crude production in part to the growth in illegal taps.

     

    The drug cartels have turned to fuel theft as a side business worth hundreds of millions of dollars each year, and crime groups focused solely on gasoline robbery have sprung up, says Alejandro Schtulmann, president of Empra, a political-risk consulting firm in Mexico City. “You only need to invest $5,000 or $8,000 to buy some specific equipment, and the outcome of that is huge earnings.”

     

    Fuel theft creates a vicious cycle: The theft increases costs for Pemex and makes the official gasoline supply more scarce, contributing to higher prices for legal consumers. Theft amounts to about $1 billion a year, says Luis Miguel Labardini, an energy consultant at Marcos y Asociados and senior adviser to Pemex’s chief financial officer in the 1990s. “If Pemex were a public company, they would be in financial trouble just because of the theft of fuel,” he says. “It’s that bad.”

    Of course, there are some losers in all of this as Enrique Peña Nieto has basically become the least popular President in Mexico since one-party ruled ended in 2000.

    All this is creating headaches for Enrique Peña Nieto, whose popularity was already the lowest of any president since one-party rule ended in 2000. Peña Nieto is limited to a single term, and polls show potential candidates from his Institutional Revolutionary Party (PRI) trail populist opposition leader Andrés Manuel López Obrador in the race for the mid-2018 presidential election. López Obrador has made the jump in gasoline prices his latest rallying cry against the administration.

     

    “This is definitely going to have consequences for the PRI,” says Jorge Chabat, a political scientist at the Center for Economic Research and Teaching, a university based in Mexico City. “Frankly, I don’t see any way that they can win in 2018.”

    State-owned Pemex is also one of the losers with the company expected to lose about $1 billion to theft this year…but no one really pays taxes anyway so it shouldn’t be that big a deal.

  • Neil Cavuto Kicks CNN in the Ass for Ignoring Obama’s Attacks on Fox News Over the Past 8 Years

    Over the past 8 years, on a continuous basis, the liberal media has impugned the integrity of the only conservative news outlet in the country (Fox) — laughing and smirking while President Obama kicked them in the shins. Now that Trump refused a question from a reporter at CNN, which was punishment for publishing some very damaging information about him that wasn’t true or fact checked, CNN is crying ‘unfair’, causing their supporters to accuse Trump of (wait for it) FASCISM. There’s a double standard being pressed by here by CNN, wanting to be treated fairly while at the same time being shameful in their own conduct.

    The proverbial shoe is on the other foot, claimed Fox’s Neil Cavuto, and it probably isn’t a very comfy one. The Obama administration has gotten away with murder (extra Seth Rich) over the past 8 years and not once did CNN take him to task for it, instead opting to serve him and his ilk in a manner which is the antithesis of a free and independent press.

    They’ve ruined the fifth estate, which is why start up media organizations are booming across the internet.

     

    Content originally generated at iBankCoin.com

  • The Utter Stupidity Of The New Cold War

    Submitted by Gary Leupp via The Strategic Culture Foundation,

    It seems so strange, twenty-seven years after the fall of the Berlin Wall, to be living through a new Cold War with (as it happens, capitalist) Russia.

    The Russian president is attacked by the U.S. political class and media as they never attacked Soviet leaders; he is personally vilified as a corrupt, venal dictator, who arrests or assassinates political opponents and dissident journalists, and is hell-bent on the restoration of the USSR.

    (The latter claim rests largely on Vladimir Putin’s comment that the dissolution of the Soviet Union was a “catastrophe” and “tragedy” — which in many respects it was. The press chooses to ignore his comment that “Anyone who does not miss the Soviet Union has no heart, while anyone who wants to restore it has no brain.” It conflicts with the simple talking-point that Putin misses the imperial Russia of the tsars if not the commissars and, burning with resentment over the west’s triumph in the Cold War, plans to exact revenge through wars of aggression and territorial expansion.)

    The U.S. media following its State Department script depicts Russia as an expansionist power. That it can do so, so successfully, such that even rather progressive people—such as those appalled by Trump’s victory who feel inclined to blame it on an external force—believe it, is testimony to the lingering power and utility of the Cold War mindset.

    The military brass keep reminding us: We are up against an existential threat! One wants to say that this — obviously — makes no sense! Russia is twice the size of the U.S. with half its population. Its foreign bases can be counted on two hands. The U.S. has 800 or so bases abroad.

    Russia’s military budget is 14% of the U.S. figure. It does not claim to be the exceptional nation appointed by God to preserve “security” on its terms anywhere on the globe. Since the dissolution of the USSR in 1991, the U.S. has waged war (sometimes creating new client-states) in Bosnia (1994-5),  Serbia (1999), Afghanistan (2001- ), Iraq (2003- ), Libya (2011), and Syria (2014- ), while raining down drone strikes from Pakistan to Yemen to North Africa. These wars-based-on-lies have produced hundreds of thousands of civilian deaths, millions of refugees, and general ongoing catastrophe throughout the “Greater Middle East.” There is no understating their evil.

    The U.S. heads an expanding military alliance formed in 1949 to confront the Soviet Union and global communism in general. Its raison d’être has been dead for many years. Yet it has expanded from 16 to 28 members since 1999, and new members Estonia and Latvia share borders with Russia.

    (Imagine the Warsaw Pact expanding to include Mexico. But no, the Warsaw Pact of the USSR and six European allies was dissolved 26 years ago in the idealistic expectation that NATO would follow in a new era of cooperation and peace.)

    And this NATO alliance, in theory designed to defend the North Atlantic, was only first deployed after the long (and peaceful) first Cold War, in what had been neutral Yugoslavia (never a member of either the Warsaw Pact nor NATO), Afghanistan (over 3000 miles from the North Atlantic), and the North African country of Libya. Last summer NATO held its most massive military drills since the collapse of the Soviet Union, involving 31,000 troops in Poland, rehearsing war with Russia. (The German foreign minister Frank-Walter Steinmeier actually criticized this exercise as “warmongering.”)

    Alliance officials expressed outrage when Russia responded to the warmongering by placing a new S-400 surface-to-air missiles and nuclear-capable Iskander systems on its territory of Kaliningrad between Poland and Lithuania on the Baltic coast. But Russia has in fact been comparatively passive in a military sense during this period.

    In 1999, as NATO was about to occupy the Serbian province of Kosovo (soon to be proclaimed an independent country, in violation of international law), nearby Russian peacekeepers raced to the airport in Pristina, Kosovo, to secure it an ensure a Russian role in the Serbiam province’s  future. It was a bold move that could have provoked a NATO-Russian clash. But the British officer on the ground wisely refused an order from Gen. Wesley Clark to block the Russian move, declaring he would not start World War III for Gen. Clark.

    This, recall, was after Bill Clinton’s secretary of state, Madeleine Albright (remember, the Hillary shill who said there’s a special place in hell reserved for women who don’t vote for women) presented to the Russian and Serbian negotiators at Rambouillet a plan for NATO occupation of not just Kosovo but all Serbia. It was a ridiculous demand, rejected by the Serbs and Russians, but depicted by unofficial State Department spokesperson and warmonger Christiane Amanpour as the “will of the international community.” As though Russia was not a member of the international community!

    This Pristina airport operation was largely a symbolic challenge to U.S. hegemony over the former Yugoslavia, a statement of protest that should have been taken seriously at the time.

    In any case, the new Russian leader Putin was gracious after the 9/11 attacks in 2001, even offering NATO a military  transport corridor through Russia to Afghanistan (closed in 2015). He was thanked by George W. Bush with the expansion of NATO by seven more members in 2004. (The U.S. press made light of this extraordinary geopolitical development; it saw and continues to see the expansion of NATO as no more problematic than the expansion of the UN or the European Union.) Then in April 2008 NATO announced that Georgia would be among the next members accepted into the alliance.

    Soon the crazy Georgian president Mikhail Saakashvili, emboldened by the promise of near-term membership, provoked a war with the breakaway republic of South Ossetia, which had never accepted inclusion of the new Georgian state established upon the dissolution of the Georgian Soviet Socialist Republic in 1991. The Ossetians, fearing resurgent Georgian nationalism, had sought union with the Russian Federation. So had the people of Abkhazia.

    The two “frozen conflicts,” between the Georgian state and these peoples, had been frozen due to the deployment of Russian and Georgian peacekeepers. Russia had not recognized these regions as independent states nor agreed to their inclusion in the Russian Federation. But when Russian soldiers died in the Georgian attack ion August, Russia responded with a brief punishing invasion. It then recognized of the two new states (six months after the U.S. recognized Kosovo).

    (Saakashvili, in case you’re interested, was voted out of power, disgraced, accused of economic crimes, and deprived of his Georgian citizenship. After a brief stint at the Fletcher School of International Law and Diplomacy at Tufts University—of which I as a Tufts faculty member feel deeply ashamed—he was appointed as governor of Odessa in Ukraine by the pro-NATO regime empowered by the U.S.-backed coup of February 22, 2014.)

    Sen. John McCain proclaimed in 2008: “We are all Georgians now,” and advocated U.S. military aid to the Georgian regime. An advocate of war as a rule, McCain then became a big proponent of regime change in Ukraine to allow for that country’s entry into NATO. Neocons in the State Department including most importantly McCain buddy Victoria Nuland, boasted of spending $ 5 billion in support of “the Ukrainian people’s European aspirations” (meaning: the desire of many Ukrainians in the western part of the country to join the European Union — risking, although they perhaps do not realize it, a reduction in their standard of living under a Greek-style austerity program — to be followed by NATO membership, tightening the military noose around Russia).

    The Ukrainian president opted out in favor of a generous Russian aid package. That decision — to deny these “European aspirations” — was used to justify the coup.

    But look at it from a Russian point of view. Just look at this map, of the expanding NATO alliance, and imagine it spreading to include that vast country (the largest in Europe, actually) between Russia to the east and Poland to the west, bordering the Black Sea to the south. The NATO countries at present are shown in dark blue, Ukraine and Georgia in green. Imagine those countries’ inclusion.

    And imagine NATO demanding that Russia vacate its Sevastopol naval facilities, which have been Russian since 1783, turning them over to the (to repeat: anti-Russian) alliance. How can anyone understand the situation in Ukraine without grasping this basic history?

    The Russians denounced the coup against President Viktor Yanukovych (democratically elected—if it matters—in 2010), which was abetted by neo-fascists and marked from the outset by an ugly Russophobic character encouraged by the U.S. State Department. The majority population in the east of the country, inhabited by Russian-speaking ethnic Russians and not even part of Ukraine until 1917, also denounced the coup and refused to accept the unconstitutional regime that assumed power after Feb. 22.

    When such people rejected the new government, and declared their autonomy, the Ukrainian army was sent in to repress them but failed, embarrassingly, when the troops confronted by angry babushkas turned back. The regime since has relied on the neo-fascist Azov Battalion to harass secessionists in what has become a new “frozen conflict.”

    Russia has no doubt assisted the secessionists while refusing to annex Ukrainian territory, urging a federal system for the country to be negotiated by the parties. Russian families straddle the Russian-Ukrainian border. There are many Afghan War veterans in both countries. The Soviet munitions industry integrated Russian and Ukrainian elements. One must assume there are more than enough Russians angry about such atrocities as the May 2014 killing of 42 ethnic Russian government opponents in Odessa to bolster the Donbas volunteers.

    But there is little evidence (apart from a handful of reports about convoys of dozens of “unmarked military vehicles” from Russia in late 2014) for a Russian “invasion” of Ukraine. And the annexation of Crimea (meaning, its restoration to its 1954 status as Russian territory) following a credible referendum did not require any “invasion” since there were already 38,000 Russian troops stationed there. All they had to do was to secure government buildings, and give Ukrainian soldiers the option of leaving or joining the Russian military. (A lot of Ukrainian soldiers opted to stay and accept Russian citizenship.)

    Still, these two incidents — the brief 2008 war in Georgia, and Moscow’s (measured) response to the Ukrainian coup since 2014 — have been presented as evidence of a general project to disrupt the world order by military expansion, requiring a firm U.S. response. The entirety of the cable news anchor class embraces this narrative.

    But they are blind fools. Who has in this young century disrupted world order more than the U.S., wrecking whole countries, slaughtering hundreds of thousands of innocents, provoking more outrage through grotesquely documented torture, generating new terror groups, and flooding Europe with refugees who include some determined to sow chaos and terror in European cities? How can any rational person with any awareness of history since 1991 conclude that Russia is the aggressive party?

    And yet, this is the conventional wisdom. I doubt you can get a TV anchor job if you question it. The teleprompter will refer routinely to Putin’s aggression and Russian expansion and the need for any mature presidential candidate to respect the time-honored tradition of supporting NATO no matter what. And now the anchor is expected to repeat that all 17 U.S. intelligence services have concluded that Vladimir Putin interfered in the U.S. presidential election.

    Since there is zero evidence for this, one must conclude that the Democratic losers dipped into the reliable grab bag of scapegoats and posited that Russia and Putin in particular must have hacked the DNC in order to — through the revelation of primary sources of unquestionable validity, revealing the DNC’s determination to make Clinton president, while sabotaging Sanders and promoting (through their media surrogates)  Donald Trump as the Republican candidate — undermine Clinton’s legitimacy.

    All kinds of liberals, including Sanders’ best surrogates like Nina Turner, are totally on board the Putin vilification campaign. It is sad and disturbing that so many progressive people are so willing to jump on the new Cold War bandwagon. It is as though they have learned nothing from history but are positively eager, in their fear and rage, to relive the McCarthy era.

    But the bottom line is: U.S. Russophobia does not rest on reason, judgment, knowledge of recent history and the ability to make rational comparisons. It rests on religious-like assumptions of “American exceptionalism” and in particular the right of the U.S. to expand militarily at Russia’s expense — as an obvious good in itself, rather than a distinct, obvious evil threatening World War III.

    The hawks in Congress — bipartisan, amoral, ignorant, knee-jerk Israel apologists, opportunist scum — are determined to dissuade the president-elect (bile rises in my throat as I use that term, but it’s true that he’s that, technically) from any significant rapprochement with Russia. (Heavens, they must be horrified at the possibility that Trump follows Kissinger’s reported advice and recognizes the Russian annexation of Crimea!) They want to so embarrass him with the charge of being (as Hillary accused him of being during the campaign) Putin’s “puppet” that he backs of from his vague promise to “get along” with Russia.

    They don’t want to get along with Russia. They want more NATO expansion, more confrontation. They are furious with Russian-Syrian victories over U.S-backed, al-Qaeda-led forces in Syria, especially the liberation of Aleppo that the U.S. media (1) does not cover having no reporters on the ground, and little interest since events in Syria so powerfully challenge the State Department’s talking points that shape U.S. reporting, (2) misreports systematically, as the tragic triumph of the evil, Assad’s victory over an imaginary heroic opposition, and (3) sees the strengthening of the position of the Syrian stats as an indication of Russia’s reemergence as a superpower. (This they they cannot accept, as virtually a matter of religious conviction; the U.S. in official doctrine must maintain “full spectrum dominance” over the world and prohibit the emergence of any possible competitor, forever.)

    * * *

    The first Cold War was based on the western capitalists’ fear of socialist expansion. It was based on the understanding that the USSR had defeated the Nazis, had extraordinary prestige in the world, and was the center for a time of the expanding global communist movement. It was based on the fear that more and more countries would achieve independence from western imperialism, denying investors their rights to dominate world markets. It had an ideological content. This one does not. Russia and the U.S. are equally committed to capitalism and neoliberal ideology. Their conflict is of the same nature as the U.S. conflict with Germany in the early 20th century. The Kaiser’s Germany was at least as “democratic” as the U.S.; the system was not the issue. It was just jockeying for power, and as it happened, the U.S. intervening in World War I belatedly, after everybody else was exhausted, cleaned up. In World War II in Europe, the U.S. having hesitated to invade the continent despite repeated Soviet appeals to do so, responded to the fall of Berlin to Soviet forces by rushing token forces to the city to claim joint credit.

    And then it wound up, after the war, establishing its hegemony over most of Europe — much, much more of Europe than became the Soviet-dominated zone, which has since with the Warsaw Pact evaporated.  Russia is a truncated, weakened version of its former self. It is not threatening the U.S. in any of the ways the U.S. is threatening itself. It is not expanding a military alliance. It is not holding huge military exercises on the U.S. border. It is not destroying the Middle East through regime-change efforts justified to the American people by sheer misinformation. In September 2015 Putin asked the U.S., at the United Nations: “Do you realize what you’ve done?”

    Unfortunately the people of this country are not educated, by their schools, press or even their favorite websites to realize what has been done, how truly horrible it is, and how based it all is on lies. Fake news is the order of the day.

    Up is down, black is white, Russia is the aggressor, the U.S. is the victim. The new president must be a team-player, and for God’s sake, understand that Putin is today’s Hitler, and if Trump wants to get along with him, he will have to become a team-player embracing this most basic of political truths in this particular imperialist country: Russia (with its nukes, which are equally matched with the U.S. stockpile) is the enemy, whose every action must be skewed to inflame anti-Russian feeling, as the normative default sentiment towards this NATO-encircled, sanction-ridden, non-threatening nation, under what seems by comparison a cautious, rational leadership?

    * * *

    CNN’s horrible “chief national correspondent” John King (former husband of equally horrid Dana Bash, CNN’s “chief political correspondent”) just posed the question, with an air of aggressive irritation: “Who does Donald Trump respect more, the U.S. intelligence agencies, or the guy who started Wikileaks [Assange]?”

    It’s a demand for the Trump camp to buy the Russian blame game, or get smeared as a fellow-traveler with international whistle-blowers keen on exposing the multiple crimes of U.S. imperialism.

    So the real question is: Will Trump play ball, and credit the “intelligence community” that generates “intelligence products” on demand, or brush aside the war hawks’ drive for a showdown with Putin’s Russia? Will the second Cold War peter out coolly, or culminate in the conflagration that “Mutually Assured Destruction” (MAD) was supposed to render impossible?

    The latter would be utterly stupid. But stupid people — or wise people, cynically exploiting others’ stupidity — are shaping opinion every day, and have been since the first Cold War, based like this one on innumerable lies.

  • New York Times Admits "Higher Minimum Wage May Have Losers"

    The New York Times would like for you to know that, after attending the annual meeting of the American Economic Association where they sat in on multiple presentations on the economic impacts of minimum wage, they can now confirm what most of us have known for most of our adult lives, namely that basic economic supply/demand models actually work.

    Apparently, the NYT was pleasantly surprised when the first presentation suggested that higher minimum wage didn’t actually result in job losses, just lower hours, but then quickly realized it’s basically the same thing.

    At first glance, the findings were consistent with the growing body of work on the minimum wage: While the workers saw their wages rise, there was little decline in hiring. But other results suggested that the minimum wage was having large effects. Most important, the hours a given worker spent on a given job fell substantially for jobs that typically pay a low wage — say, answering customer emails.

     

    Mr. Horton concluded that when forced to pay more in wages, many employers were hiring more productive workers, so that the overall amount they spent on each job changed far less than the minimum-wage increase would have suggested. The more productive workers appeared to finish similar work more quickly.

    Unfortunately, the second study left a bit less to the imagination.  After studying “tens of thousands of restaurants in the San Francisco area,” researchers
    Michael Luca of Harvard Business School and Dara Lee Luca of Mathematica Policy Research found that many lower rated restaurants have a unique way of dealing with minimum wage hikes: they simply go out of business.

    A second study presented at the conference suggests another way that employers may respond to a rising minimum wage: simply going out of business.

     

    The husband-and-wife research team of Michael Luca of Harvard Business School and Dara Lee Luca of Mathematica Policy Research identified the ratings of tens of thousands of restaurants in the San Francisco area on the website Yelp and found that many poorly rated restaurants tend to go out of business after a minimum-wage increase takes effect.

    Finally, confirming what we’ve noted multiple times (and basic common sense for that matter), Zane Tankel, an owner of several dozen Applebee’s restaurants in the New York City area, informed the startled New York Times that higher minimum wage simply improves the ROIC profile of capital investments thereby speeding up employee replacement projects….shocking.

    Zane Tankel, chief executive and equity partner in a group that owns and operates several dozen Applebee’s restaurants in the New York City area, said replacing low-skilled workers with higher-skilled ones after the state’s recent minimum-wage increases is “not something that we try to do.”

     

    Mr. Tankel argued that differences in the productivity of low-level workers in his industry are not very big. “It’s just a lot more money for the exact same job description,” he said. He is accelerating automation in his restaurants, including tablet devices for ordering certain items and payment, to offset the costs of the higher minimum.

    With that, here are some charts illustrating where the most minimum wage workers will lose their jobs over the coming years:

    Min Wage

    Min Wage

     

    And while California and Washington DC have already won their “Fight for $15”, here’s where all the other states stand in their efforts to crush low-income workers.

    Min Wage

  • China Daily: Tillerson's "Disastrous" Actions Would Set The Course For A "Devastating Confrontation"

    We were surprised by how contained China was this morning after yesterday’s confirmation hearing of Rex Tillerson, in which the former Exxon CEO said that a failure to respond to China had allowed it to “keep pushing the envelope” in the South China Sea and added that “we’re going to have to send China a clear signal that first the island-building stops and second your access to those islands is also not going to be allowed” and that putting military assets on those islands was “akin to Russia’s taking Crimea” from Ukraine.”

    Traditionally such a direct threat would be i) perceived as very undiplomatic and ii) prompt an immediate, and angry rebuke from Beijing, with China immediately shifting to the offensive.

    “This is the sort of off-the-cuff remark akin to a tweet that pours fuel on the fire and maybe makes things worse,” Malcolm Davis, a senior analyst at the Australian Strategic Policy Institute in Canberra told Bloomberg. “Short of going to war with China, there is nothing the Americans can do.”

    But not today: during his press conference earlier today, Foreign Ministry spokesman Lu Kang could barely muster the will to sound defensive, saying China has been acting within the limits of its sovereignty. “Like the U.S., China has the right within its own territory to carry out normal activities,” he said at a regular briefing in Beijing. When asked repeatedly about Tillerson’s comments on blocking access to islands, China’s foreign ministry spokesman said he couldn’t make any guesses as to what Tillerson was referring to and would not answer hypothetical questions, Reuters reported.

    As it turns out, China may not have had time to digest what Tillerson said. After all his South China sea remark was toward the end of his nearly all day long hearing, and so many local media outlets may have simply missed it. However, they caught up today, and first China Daily, then its nationalist tabloid, the Global Times took turns to first mock, then attack Tillerson.

    Here is the gist of the China Daily op-ed published earlier today: according to the Chinese daily mouthpiece, not only were Tillerson’s views “divergent from, even contrary to, those of Trump on some critical issues. He openly conceded he is yet to have a serious, in-depth discussion with Trump on foreign policy imperatives. These boil down to one simple point – his remarks at the Wednesday hearing, sensational as they were, turned out to be of little reference value except for judging his personal orientations.“

    Yet while China realizes that Tillerson’s bluster was intended for a specific audience, that does not make it any happier:

    The backlash that has ensued is understandable. It is certainly no small matter for a man intended to be the US diplomat in chief to display such undisguised animosity toward China.  Tillerson labeled China’s reclamation projects in the South China Sea as “an illegal taking of disputed areas without regard for international norms,” in obvious disregard of the essential truth that all those activities took place well within the country’s persistent, historical territorial claims.

     

    Blaming the “extremely worrisome” state of affairs in the South China Sea on an “inadequate US response”, the US secretary of state nominee even claimed China’s access to those islands should “not to be allowed”. Which sounded intimidating; though he stopped short of elaborating how to achieve it. And like Trump, he blamed Beijing for “not being a reliable partner” in dealing with the Democratic People’s Republic of Korea.

    And then, the not so subtle threats followed:

    Such remarks are not worth taking seriously because they are a mish-mash of naivety, shortsightedness, worn-out prejudices, and unrealistic political fantasies. Should he act on them in the real world, it would be disastrous.

     

    As many have observed, it would set a course for devastating confrontation between China and the US. After all, how can the US deny China access to its own territories without inviting the latter’s legitimate, defensive responses?

    Finally, the mocking of Tillerson as a clueless former company exec who does not have the faintest understanding of diplomacy: “Tillerson wanted a reality-based China policy that is “based on what we see and not based on what we hope”. But what he presented was based more on what prejudice and arms-spurred self-righteousness make him believe and hope than on real-world realities. What happened on Wednesday shows that if and when confirmed, Rex Tillerson needs to first acquaint himself with the ABCs of China-US relations and diplomacy at large.“

    The Global Times approach was almost verbatim. First, the justification of Tillerson’s “bluster”:

    It is suspected that he merely wanted to curry favor from senators and increase his chances of being confirmed by intentionally showing a tough stance toward China.

     

    Tillerson did not give details of how he would achieve his self-proclaimed goals. Nonetheless, he also mentioned that Chinese and American economic interests are deeply intertwined and that “China has been a valuable ally in curtailing elements of radical Islam.” He noted that “We should not let disagreements over other issues exclude areas for productive partnership.”

    Motives aside, the GT then explained that China no longer views itself as America’s subordinate:

    China has enough determination and strength to make sure that his rabble rousing will not succeed. Unless Washington plans to wage a large-scale war in the South China Sea, any other approaches to prevent Chinese access to the islands will be foolish. The US has no absolute power to dominate the South China Sea.

    Following this, just like in the case of China Daily, there was the mocking:

    Tillerson had better bone up on nuclear power strategies if he wants to force a big nuclear power to withdraw from its own territories. Probably he just has oil prices and currency rates in his mind as former ExxonMobil CEO.

    Next, the not so thinly veiled threat – again – aimed not so much at Tillerson but at Trump:

    As Trump has yet to be sworn in, China has shown restraint whenever his team members expressed radical views. But the US should not be misled into thinking that Beijing will be fearful of their threats.

    How does it all end according to China? Unless Trump’s diplomatic team changes course, the Times said “the two sides better prepare for a military clash.”

    Tillerson’s statements regarding the islands in the South China Sea are far from professional. If Trump’s diplomatic team shapes future Sino-US ties as it is doing now, the two sides had better prepare for a military clash. South China Sea countries will accelerate their negotiations on a Code of Conduct. They have the ability to solve divergences by themselves without US interference.

    And the conclusion:

    Just as the Philippines and Vietnam are trying to warm their ties with China, Tillerson’s words cannot be more irritating.  It is hoped that Tillerson will desire a productive partnership with China more and his harsh words are just coaxing the Senate Foreign Relations Committee. But no matter what, China will always respond to various US diplomatic maneuvers.

    As a reminder, all this has already happened and Trump isn’t president yet. We eagerly look forward to the president-elect’s next steps vis-a-vis an increasingly angry CHina and vice versa.

  • S&P Downgrades City Of Dallas On "Continued Deterioration" Of Police Pension

    As the City of Dallas continues to work with the Dallas Police and Fire Pension (DPFP) board on solutions to help close the pension’s massive $4 billion funding hole, Standard & Poor’s has finally decided that the “continued deterioration in the funded status” of the fund merits a downgrade.  As such, S&P has downgraded the city’s general obligation bonds to “AA-” from “AA” and placed them on “negative watch.”  Per the Dallas Business Journal:

    “The downgrade reflects our view that despite the city’s broad and diverse economy, which continues to grow, stable financial performance, and very strong management practices, expected continued deterioration in the funded status of the city’s police and fire pension system coupled with growing carrying costs for debt, pension, and other post-employment benefit obligations is significant and negatively affects Dallas’ creditworthiness,” S&P Global Ratings credit analyst Andy Hobbs said in a statement.

     

    The police and fire pension system could go insolvent in the next 10 years because of a funding gap. The financial troubles, along with a multi-billion-dollar lawsuit between the city and emergency works, could put Dallas on a path to bankruptcy.

    The move by S&P comes over a month after Moody’s downgraded Dallas’ credit rating, for the second time in recent months, to A1, which is a notch below S&P’s new rating.  Oddly, as we pointed out yesterday, S&P also seems to be somewhat delayed in their rating downgrade of the City of Chicago (see “Chicago Mayor Emanuel Pushes Moody’s To Rescind Junk Rating Ahead Of $1.2 Billion New Issue“).  That said, we’re sure it has nothing to do with keeping the city’s G.O. rating above investment grade just long enough to get that $1.2 billion bond deal done next week so that Rahm Emanuel can continue his ponzi scheme with taxpayer money. 

    Of course, the downgrades have come as little surprise to Dallas Mayor Mike Rawlings who, for months, has been arguing that the “run on the pension” has brought the DPFP to the “verge of collapse.”  Responding to the downgrade, even Dallas CFO Elizabeth Reich implied that S&P was a little late to the ball game saying their “actions today are not a surprise” and that the “pension is a significant risk to the fiscal health of the City.”

    “S&P’s actions today are not a surprise,” Dallas Chief Financial Officer Elizabeth Reich said in a statement. “The more the rating agencies learn about the crisis facing Dallas as a result of the police and fire pension, the more they understand what the City has been saying for some time – the pension is a significant risk to the fiscal health of the City.”

    As we noted last week, this most recent downgrade for Dallas comes after the City Council floated a proposal to inject $1 billion of incremental taxpayer funding into the DPFP, over the course of 30 years, if retirees would agree to a $1 billion “clawback” of what city officials referred to a ill-gotten interest guarantees (see “City Of Dallas Looks To “Clawback” Ill-Gotten Pension Gains From Police“).

    Unfortunately, the downgrade from S&P came a day before the pension board is (1) scheduled to meet with Bank of America about restructuring or extending roughly $130 million in outstanding debt and (2) due to decide whether to lift its ban on large, lump-sum payments to retirees. 

    The pension is in danger of falling into insolvency in the next 10 years because of an estimated $3.3 billion funding gap. The problem, along with a multi-billion-dollar lawsuit over emergency worker back pay, could send the city spiraling into bankruptcy and threaten its blossoming economy. The state is launching a criminal investigation into the previous administration’s handling of the pension’s finances.

     

    “We have been working with Bank of America on the terms of the loan and possibly restructuring and extending the term,” a spokesman for the pension board said in an email to the Dallas Business Journal. “Nothing is finalized at this point.”

    But we’re just everything is fine, Bank Of America, so please go ahead and grant that loan extension for an extra 10 bps of yield.

    * * *

    For those that haven’t followed this story as closely, here is a recap we posted last week.

    Almost exactly one month after taking the unprecedented step of suspending withdrawals from the Dallas Police and Fire Pension (DPFP), the Dallas city council is looking to “clawback” what it views as ill-gotten interest payments made to pensioners to the tune of roughly $1 billion.

    Of course, we have followed the epic meltdown of the DPFP closely over the past several months after a series of shady real estate deals brought the fund to, in the words of Dallas Mayor Mike Rawlings, “the verge of collapse” and resulted in an FBI raid of one of the funds largest real estate investors (see “Dallas Cops’ Pension Fund Nears Insolvency In Wake Of Shady Real Estate Deals, FBI Raid“).  The discovery of the failed real estate deals led to a “run on the bank” as scared pensioners looked to withdraw as much as possible before the whole ponzi scheme collapsed (see “After A “Run On The Pension Fund” Dallas Mayor Demands Halt Of Withdrawals“).  All of which culminated with the unprecedented decision last month to suspend withdrawals (see “In Unprecedented Move, Dallas Pension System Suspends Withdrawals“) after nearly $500mm was removed from police accounts.

    Now, according to a local ABC affiliate, the Dallas city council is frantically working with the DPFP board to close a $4 billion funding gap.  While the city has agreed to throw an incremental $1 billion of taxpayer money at the problem over the next 30 years, that additional funding comes with some strings attached, which includes a $1 billion “clawback” of what the city views as ill-gotten gains from Police DROP accounts.  The proposed “clawbacks” would come in the form of reduced future distributions for pensioners.

    For those who haven’t followed this story as closely, DROP, which was created in the early 90’s, allowed police and firefighters in Dallas to retire while still on the job. Their monthly pension checks were then diverted into DROP accounts, which were guaranteed an 8-10% return regardless of how the overall fund performed.  Unfortunately for DPFP pensioners, the Dallas City Council now views those guaranteed returns as an effort to defraud Dallas taxpayers of billions…we would tend to agree.

    The city has agreed to put in an additional billion dollars over 30 years, but they’re proposing a series of bitter pills to make up the rest of the nearly $4 billion shortfall.

     

    The bitterest pill: A proposal to take back all of the interest police and firefighters earned on Deferred Option Retirement accounts, or DROP. That would amount to an additional billion dollars saved.

     

    The city is calling it an “equity adjustment.” Retirees call it an illegal “claw back.”

     

    Whatever you want to call it, it’s outlined in a draft legislation being hammered out by the city and pension fund leaders. Pension fund representatives and the city have been meeting almost daily to try to come to an agreement on proposed legislation that they can take to the state capital to fix the failing fund.

    Of course, anyone with half a brain probably should have realized that this ponzi on steroids was doomed to fail from the start.  But, better late than never we suppose. 

    To add insult to injury, for Dallas taxpayers at least, the City Council also notes that the DPFP’s artificially high annual cost of living adjustments have resulted in pension checks that are 20% higher than they would have been had they been tied to actual inflation levels instead. 

    News 8 obtained a copy of the legislation which says accounts would be “adjusted to zero percent of interest.”

     

    “It’s very tough but the city wants to protect the monthly benefit,” Kleinman said. “It’s a restatement of their accounts.”

     

    The city is also seeking to “equity adjustment” on cost of living increases. The city says that pension checks are about 20 percent higher than they would have been if increases had been tied to inflation.

     

    The city’s proposing to freeze cost of living increases until it catches up to the inflation index.

     

    DROP and the cost of living increases account for about half of the fund’s liability, the city says.

     

    For those retirees who have already taken the money out of DROP accounts, they’d garnish their future pension checks to recoup excess interest. Worried retirees have withdrawn in excess of $500 million from DROP accounts in recent months.

    Meanwhile, all of these discussions have Dallas’ police predictably upset.

    “We used the rules they gave us now all of the sudden they’re going to go back on the rules and say hey you don’t get any of that,” said Charles Hale, a retired police officer. “That’s not fair.”

     

    Retirees promised they’d be suing if anybody tried to take back money they feel they’ve earned.

     

    “It’s acting like it was an underhanded Ponzi scheme that we pulled,” said Joe Dunn, a retired police officer. “It’s not fair.”

    Frankly, we too are shocked at the audacity of the Dallas City Council to suggest that public employees be forced to be compensated in a way somewhat more akin to private employees.  It’s just outrageous.

     

  • Afghan "Ghost Soldiers" Are Costing US Taxpayers Hundreds Of Millions Of Dollars Annually

    Submitted by Jason Ditz via AntiWar.com,

    Special Inspector General for Afghanistan Reconstruction (SIGAR) John Sopko is once again warning about the long-standing problems of corruption in Afghanistan, and the amount of US “reconstruction aid” disappearing down black holes over the course of the years. As always, the discussion came around to “ghost soldiers.”

    Ghost soldiers are a phenomenon in which Afghan military commanders fill their ranks with fictional names and just keep the salaries, which since the salaries are paid pretty much exclusively by NATO and overwhelmingly by the US, has been a known tactic that the Afghan government has done nothing to prevent.

    Sopko warned that the “ghost soldier” problem has expanded to include fictional police, teachers, and other government officials, and that all told the US taxpayers are paying the salaries of “tens of thousands” of Afghans who don’t actually exist, and will likely be doing so for years, potentially decades to come. Though exact figures are impossible to know, SIGAR said some $300 million in salaries are paid to “unverified” employees.

    Individual Afghan government employee salaries are pretty small, particularly for military recruits, which has been a big reason the nation has struggled to fill the ranks with actual people. That commanders can pocket the difference just adds to the incentive to make up names and “pay” them.

    This is a big reason why the Afghan military has struggled so mightily in fights with the Taliban as well, as their statistics on how many troops they have defending any given checkpoint or important city are wildly inaccurate, and they can find that the Taliban forces they thought they handily outnumbered are actually in a position to seize territory.

    SIGAR found that corruption cut across all aspects of the reconstruction effort, jeopardizing progress made in security, rule of law, governance, and economic growth. The report concluded that failure to effectively address the problem meant U.S. reconstruction programs, at best, would continue to be subverted by systemic corruption and, at worst, would fail.

    The report identified five main findings:

    1. Corruption undermined the U.S. mission in Afghanistan by fueling grievances against the Afghan government and channeling material support to the insurgency.
    2. The United States contributed to the growth of corruption by injecting tens of billions of dollars into the Afghan economy, using flawed oversight and contracting practices, and partnering with malign powerbrokers.
    3. The U.S. government was slow to recognize the magnitude of the problem, the role of corrupt patronage networks, the ways in which corruption threatened core U.S. goals, and that certain U.S. policies and practices exacerbated the problem.
    4. Even when the United States acknowledged corruption as a strategic threat, security and political goals consistently trumped strong anticorruption actions.
    5. Where the United States sought to combat corruption, its efforts saw only limited success in the absence of sustained Afghan and U.S. political commitment.

    *  *  *

    Full SIGAR Report below…

  • Israeli Jets Bomb Damascus Military Airport; Syria Vows It Will Respond To "Flagrant Attack"

    Just as the Syrian proxy war showed some hopeful signs of finally dying down, the Syrian army command said on Friday that Israeli jets have bombed the Mezzeh military airport west of Damascus, accusing Tel Aviv of supporting terrorism, and warned Tel Aviv of repercussions of what it called a “flagrant” attack. Syrian state TV quoted the army as saying several rockets were fired from an area near Lake Tiberias in northern Israel just after midnight which landed in the compound of the airport, a major facility for elite Republican Guards and special forces. The airport was rocked by multiple explosions, some of which were captured by social media.

    “Syrian army command and armed forces warn Israel of the repercussions of the flagrant attack and stresses its continued fight against (this) terrorism and amputate the arms of the perpetrators,” the army command said in a statement.

    The statement did not disclose if there were any casualties, but said the rockets caused a fire. Earlier, state television said several major explosions hit Mezzeh military airport compound near Damascus and ambulances were rushed to the area, without giving details.

    The airport southwest of the capital is a major strategic air base used mainly by Syrian elite Republican Guards and had been a base used to fire rockets at former rebel-held areas in the suburbs of Damascus. State television did not give any further details.

    Footage from the scene with heavy fire and the sounds of explosions has surfaced on social media. Multiple reports from journalists and activists on the ground described the bombing, with the opposition also reporting there were rockets fired.

    “Rockets strike at Mezzeh Military airport in Damascus minutes ago,” tweeted Hadi al-Bahra, former president of the National Coalition of Syrian Revolution and Opposition Forces.

    In the past, Israel has targeted positions of Lebanon’s Hezbollah group inside Syria where the Iranian-backed group is heavily involved in fighting alongside the Syrian army. According to Israeli breaking, the airport was bombed because it was a “suspected holding ammunition depots for Hezbollah. “

    Israeli defence officials have voiced concern that Hizbollah’s experience in the Syrian civil war, where it has played a significant role and recently helped the Syrian army regain the eastern sector of the city of Aleppo, has strengthened it.

    Rebels operating in the area have said Hizbollah’s major arms supply route into Damascus from the Lebanese border has been targeted on several occasions in recent years by air strikes. This has included strikes on convoys of weapons and warehouses.

    This is the second time in two months the Israeli Defense Forces have being accused by Syria of targeting Syrian positions from Israeli territory.  On December 7, SANA reported that “several surface-to-surface missiles” were launched by the IDF from the Golan Heights. At the time, the source in the Syrian armed forces slammed the attack as a “desperate attempt” by Israel to endorse terrorists.   

    Rebels operating in the area have said Hezbollah’s major arms supply route into Damascus from the Lebanese border has been targeted on several occasions in recent years by air strikes. This has included strikes on convoys of weapons and warehouses. Damascus airport was also hit by air strikes in 2013. Tel Aviv neither confirms nor denies involvement in striking targets inside Syria. Damascus has also been tightlipped about previous strikes.

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Jan 12

Today’s News 12th January 2017

  • How Globalists Predict Your Behavior

    Submitted by Brandon Smith via Alt-Market.com,

    The globalists seem to have an overarching obsession with data collection. As we have seen with revelations from multiple government whistle-blowers, the establishment spends most of its time, energy and manpower collecting information not just on known threats to their supremacy, but information on EVERYONE through FISA-based surveillance protocols. This is because the establishment sees every individual as a potential threat.

    Thus, the system, without warrant, is programmed to collate data from everywhere, not necessarily to be analyzed on the spot, but to be analyzed later in the event that a specific person rises to a level that poses legitimate harm to the globalist power structure.

    There was a time not long ago when this notion was considered “conspiracy theory” by the mainstream, but with multiple exposures from Wikileaks to Edward Snowden it is now common knowledge that the government (and the globalists) spy on us en masse. However, I do not think that many people understand the greater implications or uses for this full spectrum surveillance. This is why you sometimes hear the argument that “if you aren’t doing anything wrong, then you have nothing to worry about…”

    The truth is, mass surveillance is not done merely for the sake of surveillance, and it is certainly not undertaken for the sake of public safety. There is a greater purpose, and it is something the elites crave dearly — the purpose of total and PREDICTIVE information awareness.

    The establishment is not just hoping to observe our present behavior in detail. No, they hope to use today’s data to predict our behavior tomorrow, and at this very moment, they are extremely close to achieving their goal.

    Lets examine some of the methods they use in the pursuit of this goal…

    Internet Macro-Analytics

    Web analytics are used by almost everyone with a website of their own, and Google is a primary source for this data. Through analytics you can easily measure web traffic for a particular site, but also where in the world the traffic is coming from, how long these people are staying on your site, how many of them are new visitors versus regular visitors, how your traffic has increased or decreased over a span of months or years, etc, etc. That said analytics are not just useful to someone with a web-based business or a blog, they are very useful to the establishment. Why? Because they allow the establishment to view the behavior of most of a population at any given time.

    In fact, Eric Schmidt, the former CEO of Google, is notorious for opening his big mouth and letting slip some of the finer intricacies of the establishment’s information war. In 2010 in a videotaped interview with The Atlantic, Schmidt said this:

    “With your permission, you give us more information about you, about your friends, and we can improve the quality of our searches. We don’t need you to type at all. We know where you are. We know where you’ve been. We can more or less know what you’re thinking about.”

    Now, this statement from Schmidt is not entirely true. The use of analytics to know the thought processes of the individual person is nonsensical because, first, individuals can be highly erratic and unpredictable due to emotion, intuition and abrupt changes in psychological dynamic. The elites do not know what you are thinking, yet.

    That said, they do have the tools at their disposal to use what I would call “macro-analytics,” a widely encompassing view of internet traffic, to predict GROUP behavior.

    The ability to track the web habits of an entire population allows the elites to see shifts in social consciousness in real time. For example, I believe this very method was used to predict the shift of the U.S. population and parts of Europe towards a more conservative or “populist” ideal in 2016. Because of this the elites have acted accordingly.

    Instead of attempting to stop the social changes of the group, they have allowed conservative and sovereignty movements to attain a certain level of political power, while also setting those same movements up for epic failure in the next couple of years. I also predicted this move by the elites in advance before the Brexit Referendum (I will go into more detail on this in my next article).

    The point is, the elites do not necessarily need to spend the incredible amount of energy required to spy on each individual. When people form into ideological groups their behavior becomes much easier to predict. Through macro-analytics, the establishment can simply watch the traffic numbers of conservative and liberty sites to see how quickly a population is adopting that mindset, or abandoning it. They can read these social movements in advance and move to intercept or co-opt.

    Even if everyone in a given population found a way to use the web anonymously, this would do nothing to prevent the establishment from collecting wider analytic data and traffic data.

    The best strategy for defusing this weapon at the fingertips of the elites would be a decentralized internet; an internet in which analytics are not collected or cannot be collected. Whether this can be done using existing internet infrastructure or if it would require the freedom minded to start all over from scratch, I do not know. All I know is that while the existing system is indeed useful to liberty advocates as a means to spread information and to counter disinformation, it is also highly useful to the elites as a means to view and predict mass behavior. It is a trade-off, and it is hard to say who is getting the better part of the trade.

    For the establishment, though, the internet is quickly becoming, for all intents and purposes, the all seeing eye.

    Human Integration With The Internet

    Here is where Eric Schmidt’s claim of Google “knowing what you are thinking” could actually come true. Yet another statement from Schmidt in an interview with The Hollywood Reporter breaks down exactly what a human integration with the web might entail:

    “There will be so many IP addresses… so many devices, sensors, things that you are wearing, things that you are interacting with that you won’t even sense it. … It will be part of your presence all the time. Imagine you walk into a room, and the room is dynamic. And with your permission and all of that, you are interacting with the things going on in the room.”

    Note that Schmidt keeps bringing up the idea that they will have your “permission” to watch your life and actions in such vivid detail. The elites love the idea of consent, but see consent as an unconscious act.  Meaning, they take joy in tricking people into consenting to their own slavery through misinformed participation. Surely, if the average person knew the extent to which their information would be used by the establishment against them they would not consent to a thing. But the elites figure that your ignorance and participation is enough for them.

    Case in point, the “internet of things” which Schmidt is describing, is already here.

    Not only can spy agencies tap into your web activity and your computer microphone and webcam, but also your cell phone activity. This includes the ability to use cell phone GPS to track every move you make in real time. But cell phones can also be activated while turned off (as long as they have battery power), and your conversations can be recorded while you are none-the-wiser.

    The cell phone is also a powerful tool for video surveillance. Cell phone makers are now getting ready to equip products with facial recognition software, allowing organizations like the NSA to not only track you with your own cell phone, but also track you through OTHER people’s cell phones if they happen to capture your face in their own phone camera.  Imagine a world in which the elites have eyes everywhere because nearly everywhere you go someone is holding a cell phone with biometric software.

    New products are even more invasive. Amazon’s latest “Echo” technology, featuring “Alexa,” an app which allows the Echo to interpret your commands via microphone and talk back to you, is essentially a highly sensitive listening device (with digital speech interpretation) which people are paying good money for and willingly centralizing in their homes. This is so Orwellian it is astonishing.

    Though Amazon claims the Echo only records audio for 60 seconds at a time and has refused to give data to the government in two separate instances for use in court prosecutions, the fact is that Amazon does have the data. And, if Amazon has access, then the NSA has access. It is foolish to assume otherwise. The federal pursuit of warrants to gain the data for use in court cases is nothing more than a show designed to normalize the practice of exploiting these devices and make the idea more palatable to the public. If the data can be used to solve a crime, then how can such surveillance be bad, after all?

    What Schmidt envisions, and I think what the globalists envision, are millions of households filled with devices like the Echo. Not only this, but they also envision every human being reliant on the “internet of things” every moment of every day. They want a world in which you can’t accomplish any necessary activity without interacting with the network. They want a world in which everything you say and do is recorded and modeled and profiled. We are not quite there yet, but we are not far off, and if such a world comes to pass, then the elites will, in a sense, be able to predict individual thought and behavior.

    Countering The Surveillance Grid

    In my next article I will be outlining more methods for countering establishment intrusions into your life. Not only that, but I will also be explaining how you can turn the tables and predict the behavior of the elites.

    In the meantime, the best solution to the problem is to distance one’s self from the grid wherever possible. This means doing simple things, like leaving your cell phone at home when it is not really necessary. I grew up in an era without cell phones. Trust me, we got by just fine without them.

    It also means being more present-minded on the technology in your home and what it does. Do you really need your webcam overlooking your house all day long? Does your computer really need to be operating every second? Do you really need to take pictures of your entire life and post them on Facebook? Can you not limit your desire for every new gadget that happens to come along?

    Humanity needs a healthy distance from technology. This doesn’t mean we go back to using a horse and buggy, but it does mean there is wisdom in moderation. Mass surveillance potential by the establishment is not just a threat to people who might be “up to no good”; it is a threat to everyone. For the ability to predict a population’s behavior makes that population highly controllable. NO ONE is morally benevolent enough to be trusted with that kind of power. Anyone deliberately seeking to obtain such power should be treated with the utmost suspicion. Only the worst of men desire the means to intrude on the lives and minds of men.

  • Chuck Todd Excoriates Buzzfeed's Editor in Chief: 'YOU PUBLISHED FAKE NEWS'

    Democrat shill, Chuck Todd, cannibalized the liberal media tonight by ripping into the Editor in Chief of Buzzfeed, Ben Smith, for publishing a 35 page dossier of laughable content, such as germaphobe Trump having Russian hookers urinate on him, or an irate Donald yelling at Ivanka to respond to her mother, whilst devouring a plate of chicken tenders, saying that if she didn’t her Mother would perish in a horrible accident.
    img_6070

    Over the past day, all of the actors involved in leaking the ‘dossier’ to the public have been discredited and humiliated — from John McCain to the CIA and of course  to the Buzzfeed reporter, Rick “I’m a spy” Wilson — who published the trite piece of offal — hoping it would derail Trump’s presidency and give solace to the cadre of his fellow Never Trumpsters, who’ve been waiting for the opportunity to discredit and rid themselves of his orangeness.

    Unfortunately, for him and his ilk, there are consequences to publishing lies about the President elect of the United States, especially when done in a manner that garnered world wide exposure, galvanizing all of the snowflakes to unite and form into a maniacal Snow Demon set out to devour and crush President elect Donald J. Trump.

    Once again, The Donald has proved to be resilient, admonishing his enemies , taking a flame thrower to them — effectively reducing them to a small, sad, pond of liberal misery to be pissed upon whenever he’s in the mood for golden showers.

    Todd eats Smith.

     

    Content originally generated at iBankCoin.com

  • 2016 Chicago Homicides Even Higher Than Originally Reported

    2016 was a record breaking year for the city of Chicago, unfortunately just not in any positive ways.  Throughout 2016 we noted several grim milestones that plagued the Windy City: the deadliest month in 23 years, the deadliest day in 13 years, 4,300 people shot…the list goes on and on.  And, as we noted a couple of weeks ago, when it was all said and done Chicago was thought to have recorded around 762 murders in 2016 (see “Chicago Violence Worst In 20 Years: ‘Not Seen This Level Of Disrespect For Police Ever’“).  To put those numbers into perspective, Chicago recorded over 20% more murders in 2016 than New York and Los Angeles combined, despite having a fraction of the population.

    And as bad as all those figures are, according to the Cook County Medical Examiner’s office, the actual number of homicides recorded in Chicago in 2016 were even higher than the official police data would suggest.  The discrepancy is largely due to the fact that the Medical Examiner’s office tallies “homicides” while the official police data tracks “murders,” which exclude intentional killings that are deemed “justified” (e.g. police shootings).  So while the official police data suggests there were 762 murders in 2016 the county numbers reflect 812 homicides including all of the “justified” killings.

    The record-setting violence in Chicago is even worse than announced as new evidence shows the city suffered 50 more homicides last year than the numbers publicly reported in the past week.

     

    The city posted a decades-high homicide count of 812 in 2016, per the Cook County Medical Examiner’s office. That’s 15% greater than the 762 murders reported by the city’s police department.

     

    The discrepancy is largely due to the fact that the county tallies “homicides” while the police number counts “murders.” Murders are defined as violent acts subject to criminal prosecution. Homicides, according to the medical examiner, include instances “when the death of a person comes at the hand of another person. This does not imply that all homicides are murders that would be subject to criminal prosecution.”

     

    The city police count is also lower because it excludes violent, intentional deaths if the act is deemed justified, including police killings of residents.

    Meanwhile, the overwhelming majority of Chicago’s homicides came a result of gunshot wounds while ~80% of the victims in Cook County were African American.

    Gun violence is the leading cause of death for victims of homicide in Chicago with 725 decedents being felled by at least one gunshot wound.

     

    African Americans also bore the brunt of the violence in Cook County, which includes Chicago. They accounted for 710 of the county-wide total of 915 (88% of which occurred in the city). Men comprised 90% of the homicide victims in the county.

    On a positive note, after a violent opening weekend to the year (see “3 Killed, 27 Wounded As Chicago Opens 2017 With A String Of Murders“), shootings and murders over the past week seem to be much lower than the run-rate for most of December.  Per HeyJackAss!:

    Chicago Murders

     

    And while we would like to hope the recent data points to a less violent 2017, the collapse in shootings seems to be perfectly correlated with a 5-day period of frigid temperatures that likely kept Chicago’s violent youth indoors for a few days.

    Chicago Murders

  • FBI Reportedly Sought FISA Court Warrant To Spy On Trump Campaign Officials

    Submitted by Jason Ditz via AntiWar.com,

    A new report released today features both the FBI seeking to launch a surveillance operation against an active US presidential campaign, and the ultra-rare case of the FISA courts actually turning down an FBI request to conduct surveillance against somebody.

    The report, originating at the Guardian, claims that the FBI had sought broad surveillance powers over four high-ranking members of President-elect Donald Trump’s campaign during the election, claiming them to have had contact with Russian officials.

    The FISA court turned the request down, telling investigators they needed to narrow the request.

    Though the four are not directly named in the report, it is related to claims in a dossier of Russia having substantial blackmail dirt on Trump, and that dossier centered heavily around accusations against a handful of Trump campaign personnel, including Carter Page, Paul Manafort, and Lt. Gen. Michael Flynn, along with Trump’s personal lawyer Michael Cohen, meaning some of them may well be among the targets.

    Secondary reports speculated that the FBI may well have sought a more narrow application for surveillance, though details on that are even less clear than the previous reports.

    Though a lot of these reports don’t end up substantiated, if true this could well add to the expected acrimony between the incoming administration and the intelligence community.

  • American Home Sale Failures Suddenly Double In Q4 2016 – Signed, Sealed, No Deal

    A stunning new analysis from Trulia suggests that rising interest rates in 4Q 2016 may actually be having the desired effect of cooling home sales, despite the best efforts of Obama to keep the party rolling at the expense of American taxpayers.  Looking at homes that go from “pending” status back to “for sale”, Trulia found that the number of home “sale failures” spiked in Q4 2016, to nearly nearly double the 2015 rate, with “starter homes” being most at risk.  

    Nationally, sales have been failing at an increasing rate, rising to 4.3% in Q4 2016 from 1.4% of all listed properties during Q4 2014. On an annual basis, the failure rate has nearly doubled to 3.9% in 2016, up from 2.1% in 2015.

     

    New homes and very old homes are least likely to see deals fail. As of Q4 2016, homes built in 2016 have among the lowest proportion of failed sales at 2.6%. That proportion increases steadily as age increases to an average of 5.2% in homes built from 1959 through 1969, then falls steadily to an average of 3.5% for homes built from 1900 through 1920.

     

    Of all listings in the largest 100 metros, 7.1% of starter home listings failed in the most recent quarter, compared with 6.7% of trade-up homes and 3.8% of premium homes. For all of 2016, the failure rate was 6.3% for both starter and trade-up homes and 3.6% for premium homes.

     

    During the last two years, the places with the most failed sales are predominantly in the West with Las Vegas leading the pack at 7.6% of all unique listings reverting back to “for sale” at least once.

     

    During the most recent quarter, Tucson, Ariz., saw the highest rate of failed deals with 13.9% of all unique listings retrogressing. For all of 2016, Ventura County, Calif., had the highest fail rate at 11.6%, up from 3.1% in 2015.

     

    Considering both the last two years and just the most recent quarter, Madison, Wis., has had the fewest listings fall back to a “for sale” status at 0.1% of all listings.

    Not surprisingly, per Bloomberg, the highest rates of failure occurred in the subprime mecca of the American Southwest.

    Mortgages

     

    Meanwhile, starter homes performed the worst…

    Mortgages

     

    And while any number of things can cause a home sale to fall through, including lower than expected appraisals and bad home inspections, we suspect that rising mortgage rates are more likely the cause of the sudden surge in “failed sales” rather than a national outbreak of termites.  With Americans managing their monthly budgets down to the last penny, because you can “afford it” as long as you can cover the monthly payment, we suspect the 60bps rise in the average 30-year fixed mortgage rate during 4Q was just more than the fragile American budgets could bear.

    Mortgages

  • Russia Deploys S-400 Missile Regiment Near Moscow On Combat Duty

    While the stated reason behind its deployment has not been disclosed, Russia has put on duty a surface-to-air missile regiment equipped with the brand-new S-400 air defense system, Russia’s most advanced, in Moscow’s suburbs on combat alert.

    “The SAM combat squads of the Moscow Region aerospace forces have put the new S-400 Triumph air defense missile system into service, and have gone on combat duty for the air defense of Moscow and the central industrial region of Russia,” the Defense Ministry’s Department of Information and Mass Communication told Interfax. The new SAM battery arrived at its destination in the Moscow Region from Kapustin Yar in the south Russia last December, the Defense Ministry noted.

    “The main task of the anti-aircraft missile troops of the Russian Aerospace Forces is air defense and protecting vital state, military, industry and energy facilities, as well as the Armed Forces troops and transport communications, from aerospace attacks,” said the ministry.

    The Triumph system, which was developed by air-defense systems manufacturer Almaz Antei, is designed for high-efficiency protection against airstrikes utilizing strategic, cruise, tactical, and other kinds of ballistic missiles. The new system is capable of hitting moving targets in the air, including planes and cruise missiles, at a distance of 400 kilometers, as well as ballistic targets moving at speeds of up to 4.8 kilometers per second at altitudes ranging from several meters to several dozens of kilometers.

    As RT adds, four more Triumph units are to come into service in 2017, citing the Russia’s Defense Ministry said. S-400 Triumph air defense systems have been providing air cover for Russia’s forces in Syria since November, when President Vladimir Putin order their deployment.

    It was not clear however, why i) Russia is deploying one near the capital now and ii) why it is doing so publicly.

    “With these complexes, we are able to destroy both sea and ground targets” at distances of 350 kilometers for sea targets and nearly 450 kilometers for ground targets, Russian Defense Minister Sergey Shoigu said at the time. In October, President Putin and India’s Prime Minister Narendra Modi signed an agreement for the sale of S-400s to India. Deliveries could begin in 2020.

  • The Path To $10,000 Bitcoin

    Submitted by Charles Hugh-Smith via OfTwoMinds blog,

    So let's imagine a scenario in which tens of trillions of at-risk wealth suddenly seek an alternative–any alternative to staying in an asset class that's circling the drain.

    As my colleague Davefairtex observed recently, the paint isn't quite dry on bitcoin and the expanding host of other cryptocurrencies. Initial enthusiasm for the latest cryptocurrency that's going to eat bitcoin's lunch generates outsized returns for early investors, but as glitches in the vision arise, the bubble of initial euphoria pops.

    Differing visions of bitcoin's future have divided its community of participants and miners, and hard forks have split other cryptocurrencies into competing camps.

    Meanwhile, the spectre of outright bans on bitcoin and cryptocurrencies by nations such as China adds uncertainty to the entire sector. Many observers expect that China's increasingly pervasive attempts to staunch the flow of capital out of China via capital controls will lead inevitably to strict limits on bitcoin or even a total ban on bitcoin transactions and mining in China.

    Since the majority of mining and transactions occur in China, severe limits or a ban would have an outsized impact on the bitcoin community. Many observers foresee the potential for a massive decline in the price of bitcoin should such a ban be imposed.

    As if all these issues didn't generate enough uncertainty and skepticism, it seems as if every time the general public starts getting interested in cryptocurrencies, another exchange is hacked or another entry in the cryptocurrency sweepstakes blows up, sending the sector back into the "untrustworthy" abyss.

    But this minefield shouldn't blind us to the possibility of a path to $10,000 bitcoin. Skepticism is always prudent in any financial matter, especially a speculative one, so put on your skeptical thinkijng cap and follow along.

    The problem is everything is now speculative. Do you really think the $100 trillion private-sector bond market (i.e. the bet that debtors will pay back what they borrowed with interest) is "safe," as in guaranteed, bullet-proof, no serious loss of capital is possible, etc.? How about the $60 trillion sovereign (government) bond market?

    The problem with sovereign bonds is governments with central banks can create "money" out of thin air to pay interest and redeem maturing bonds, but this devalues the currency. So getting back 100% of your nominal investment doesn't mean you're whole; if the currency the bond is denominated in fell 50%, bondholders suffer a 50% loss in the purchasing power of their initial capital. Ouch. How is that not speculative?

    How about the $70 trillion in global stocks? Yes, we all "know" that stocks will never go down ever again because central banks can keep inflating new credit bubbles indefinitely–but let's not kid ourselves: history tells us that stocks remain a speculative gamble.

    How about the $62 trillion in unsecuritized debt instruments? How much of this debt is collateralized by fast-dying malls, bubble-priced real estate, or Unicorn-type valuations in other assets?

    Take a gander at this chart of financial assets, roughly $300 trillion, and note that this doesn't include real estate, housing, etc. Global real estate is estimated at $217 trillion, roughly two-thirds of financial wealth.

    Together, these assets add up to over $500 trillion.

    Once again, the larger context here is: all these assets are speculative. Yes, even real estate. Consider this, if you missed it: When Assets (Such as Real Estate) Become Liabilities.

    Then there's the currency market. Care to argue that currencies are non-speculative investments? Is that why Chinese wealth is gushing out of the yuan, because it's so guaranteed to never lose purchasing power? Is that why the euro fell from 1.40 to 1.05, because it's a guaranteed safe investment? Venezuelans learned the hard way that fiat currencies when mismanaged by the issuing nation/central bank can destroy wealth on an unimaginable scale.

    So now let's turn to bitcoin, with a market cap of about $14 billion, down from a recent high of $18 billion. Now compare that to $500 trillion. If we take 1 measly little trillion, bitcoin's entire market cap is 1/70th of that.

    So let's imagine a scenario in which tens of trillions of at-risk wealth suddenly seek an alternative–any alternative to staying in an asset class that's circling the drain. We're accustomed to "rotation," the nice little game where bonds can be sold and the capital invested in real estate or stocks, or vice versa.

    We're less accustomed to all the conventional asset classes toppling like dominoes. Where do the fleeing trillions go when stocks, bonds and real estate are all going down in a chaotic sell-off? Gold and silver are time-honored safe havens, but it's not too difficult to foresee the potential for limits or bans on gold, or supply constraints. Some percentage of investors will consider alternatives.

    In such an environment of a crowd rushing for increasingly narrowing exits, what thin slice of institutional and individual investors will take a chance that bitcoin might hold or even increase its value as a major currency melts down, or some other global financial crisis unfolds?

    Shall we guess 1/10th of 1% of the panicky fleeing wealth will take the chance that bitcoin will be a safer haven than the conventional assets that are cratering?

    So 1% of the $300 trillion in financial assets (setting aside the $200 trillion in real estate for the moment) is $3 trillion, and a tenth of that is $300 billion.

    So what happens to bitcoin's price if $300 billion rushes through the wormhole? On the face of it, market cap would go up 20-fold from current levels. Since the number of bitcoin is limited to around 18 or 19 million (subtracting those bitcoin lost forever to hard drive crashes, etc., and those yet to be mined), price would also have to rise 20-fold.

    OK, so 1/10th of 1% of global financial wealth flowing into bitcoin strains credulity. Let's make it 1/20th of 1%, or $150 billion. That still pushes bitcoin's market cap and price up 10-fold.

    That's the pathway to $10,000 bitcoin. Unlikely, you say? Perhaps. But if you're of the mind that $500 trillion in current assets might be revalued considerably lower in a global crisis, then a tiny sliver of that fast-evaporating wealth finding a home in bitcoin (or other cryptocurrencies) doesn't seem all that farfetched.

    You want farfetched, how about $3 trillion in panicky fleeing capital flooding into bitcoin? Yes, a whole, gigantic, enormous 1% of speculative financial "wealth" and "money" seeking a home in cryptocurrencies.

    (It's worth doing the same exercise with gold, only substitute $6.4 trillion in market cap (i.e. all the non-central owned bank gold) for bitcoin's $14 billion market cap.)

    Cryptocurrencies are intrinsically volatile and speculative. Anyone pondering them must keep this firmly in mind at all times. There is no "guaranteed" safety or guaranteed anything. Everything that appears solid can melt into thin air (to borrow Marx's phrase) without advance notice.

    All of the World’s Money and Markets in One Visualization

    How Much Gold Do Central Banks Actually Have?

    Disclosure: the author has a tiny speculative position in bitcoin. This is not a recommendation to anyone to speculate in any financial instrument, including cryptocurrecies. Please read the site's full disclosure here: HUGE GIANT BIG FAT DISCLAIMER.

  • China's Xi Open To Meet Trump's Team In Davos, Warns Populism "Can Lead To War"

    On the surface, relations between China’s president Xi and Donald Trump have had a rocky start even before the president-elect’s inauguration, with speculation about a trade war, tariffs, the collapse of the “One China” policy, the confiscation of a US naval drone, fly-bys over disputed islands, and non-stop jingoist bluster dominating the airwaves and local press. However, that may be merely bluster as the two leaders gradually warm up to each other, ironically, at a very cold place: Switzerland’s World Economic Form held, as every other year, in Davos. It is here that a senior Chinese official said Beijing is open to a meeting with US president-elect Donald Trump’s team.

    “China has good contacts with the present US government, and also has a smooth communication channel with Trump’s team,” deputy foreign minister Li Baodong said on Wednesday. Li was responding to a query on the possibility of a meeting between President Xi Jinping and Trump’s team members when they attend the World Economic Forum in Davos from January 17 to 20, according to SCMP.

    This year’s forum is expected to be dominated by discussion of a surge in public hostility toward globalization and the rise of U.S. President-elect Donald Trump, whose tough talk on trade, including promises of tariffs against China and Mexico, helped win him the White House. Earlier, we laid out the top risks envisioned by the WEF in 2017, and which will be topic of much discussion by those present. They are summarized in the chart below.

     

    State Councillor Yang Jiechi met retired general ­Michael Flynn, the US president-elect’s nominee for national security adviser, and other Trump team members in New York last month.

    What makes this year’s Davos meeting unique is that as reported previously, this will be the first time a Chinese head of state will attend the winter gathering of political and business leaders. And while Trump’s inauguration is on January 20, preventing him from participating in Davos, Xi will attend the forum as part of a state visit to Switzerland from January 15 to 18.

    World Economic Forum executive chairman Klaus Schwab said “someone from the transition team representing the new [Trump] administration” would attend the forum, according to Reuters. US Vice-President Joe Biden and Secretary of State John Kerry would also be there, Schwab said.

    “During the annual meeting in Davos, China is willing to exchange ideas with all parties [at the forum],” Li said, adding that bilateral meetings were still being discussed. “As long as both sides have the time and will, we are willing to arrange for meetings.” Commenting on why Xi had broken with past practice of sending the premier or other top officials to Davos and decided to attend himself, Li said the head of state’s decision came after “years of invitations from WEF executive chairman Klaus Schwab”.

    According to Chinese officials, quoted by Reuters, during his visit, Xi Jinping will promote “inclusive globalization” and will warn that populist approaches can lead to “war and poverty.”

    Jiang Jianguo, head of the State Council Information Office, told a symposium hosted by the World Trade Organization in Geneva that President Xi would go to Davos to push for development, cooperation and economic globalization in order to build “a human community with shared destiny.”

    “With the rise of populism, protectionism, and nativism, the world has come to a historic crossroad where one road leads to war, poverty, confrontation and domination while the other road leads to peace, development, cooperation and win-win solutions,” Jiang said.

    Here China was speaking tongue in cheek, and referring not so much to events in the UK or the US, but more about possible events in China, where it is very much terrified that if the local population is ever inspired by the anti-establishment wave observed in the developed world, then it’s game over for the Chinese landed oligarchy, which in many ways is far more corrupt and crony, not to mention rich, than any western government.

    To that point, at a briefing in Beijing on the Davos visit, Vice Foreign Minister Li Baodong said China would respond to the international community’s concern over globalization by putting forward Beijing’s opinions on how to “steer economic globalization toward greater inclusiveness.”.

    Needless to say, this is precisely the opposite direction in which Trump would like to steer the world economy.

    Li added that criticism of trade protectionism leveled at China, by Trump and others, was unjust. “Trade protectionism will lead to isolation and is in the interest of no one,” he said. “Channels of communication are open” between China and Trump’s transition team at the forum, Li said, but warned that scheduling a meeting might be difficult. Well, not if the two manage to connect in Davos, even though that would hardly resolve the inherent conflicts between a mercanilist nation and one that is (allegedly) trying to try out isolationism.

    Days after Trump’s victory, Xi vowed to fight protectionism and to push forward with multilateral trade deals. Foreign businesses in China have long complained about a lack of market access and protectionist Chinese policies.

     

  • Chanos Fears Trump's "Unmet Expectations", Warns Investors To "Rethink Almost Everything In Your Life"

    Submitted by Lynn Paramore via The Institute for New Economic Thinking,

    Milwaukee-born short-seller Jim Chanos, founder and managing partner of New York-based Kynikos Associates, teaches University of Wisconsin and Yale business students about corporate fraud. During his life and career, he has witnessed seismic shifts in economic thinking and the relationship between labor and capital.

     

    Chanos shares his thoughts on the world emerging from the election of Donald Trump and the tumultuous political events of 2016. 

    Lynn Parramore: Leading up to the election of Trump, we had eight years of Obama, and before that, eight years of Bush. Before we get to the president-elect, how do you assess the records of those past presidents in terms of basic policing of markets and corporate fraud?

    Jim Chanos: Bush was the MBA president who was going to be pro-business, cut taxes, and deregulate. Meanwhile, he had two recessions on his watch, less employment than when he started, and two bear markets in the stock market — probably the worst president for business since Herbert Hoover. The business guy!

     

    Yet, he did tighten up the Justice Department and go after corporate crime. The Ashcroft Justice Department, as bad as it was in lots of other things, went after corporate fraud and accounting fraud, criminally. In 2002, we got Sarbanes-Oxley to curb fraud.

     

    I don’t know that all this was Bush’s predilection — remember, his biggest supporter was Enron. But because of Enron and the other dot-com era scandals, he got backed into a corner to go hard on them. I’ve joked that the only person who put more corporate executives in jail than George W. Bush was his father during the Savings and Loan Crisis.

     

    On these issues, I’d rather have Bush any day of the week than Obama. Both Eric Holder and Lanny Breuer of Obama’s Justice Department said in TV interviews and testimony that they factored in non-judicial aspects as to whether to mount prosecutions. I think that this had political costs to the Democrats. The crony capitalism still bothers people — the idea that Wall Street got off scot-free and they are still struggling. That lack of justice applied equally under the law was corrosive, not necessarily for Obama personally, but certainly for the party following him.

    LP: How do you see a Trump presidency in this light?

    JC: You and I have talked about how it has become a cost calculus for lots of corporations and financial institutions to cheat. “If I get caught,” they say, “I’m just going to pay a fine.” How does this change with new faces in Washington?  You still have this very pro-corporate group on Capitol Hill whose main bailiwick, in my opinion, is to protect the corporate class and the very wealthy. You’ve got what ostensibly is a proto-populist in the White House with a cabinet that is a mélange of different types, so who knows?

     

    In my overall view, stuff happens to change people. If we go back to Bill Clinton, his “Putting People First” manifesto in ’92 was quite left-of-center, but he didn’t govern that way. If you look at things like NAFTA, Welfare reform, and cutting capital gains taxes  — well, in many ways, Ronald Reagan would have been proud of him.

     

    Events conspire to derail our perceptions of presidents. When we look at their platforms, we think we know where things are headed. But in modern times, the only two presidents that I can think of who really got their ideas and platforms enacted wholesale were FDR and Reagan. Everybody else has gotten compromised, or has had events overwhelm them.

    LP: What do you make of the expectations of the economy under Trump?

    JC: I worry about the heightened expectations from the people who voted for him thinking that he’s their savior. That’s what scares me — unmet expectations.

     

    For the swing voter in the Midwest who voted for this guy because he thinks coal-mines are coming back or the plants are going to reopen — it’s not going to happen.

    LP: What about the rise in bank stocks since the election? Are banks anticipating deregulation?

    JC: Almost all stocks are going up, mostly because of the belief of lower taxation. But after Obama’s election, most stocks went down and kept going down until the following March — and then they tripled! So I wouldn’t read a lot into the first month or two.

     

    It could be that banks are anticipating deregulation, but so what? Deregulated to what end? They’re still going to have the capital requirements, which are international. Putting capital standards on them is the biggest way in which they were regulated.

     

    In the bigger picture, if you think this is an uncertain presidency and we’re not quite sure where he’s going and how events will conspire, it’s not that important to get too worked up because things will happen and you’ll have to react. If, however, this is a once-in-a-fifty-year change in global thoughts about capitalism, then you have to pay attention.

    LP: If this is a once-in-fifty-year change, what’s at stake?

    JC: Part of my view is that in the 1930s, we rejected the individuality of the ’20s and before. After the crash and the Depression, we finally put the corporate class and bankers to the sidelines. Whether it was Keynesianism or the New Deal in the West, or state fascism or the advent of Stalinism, you saw more government control over the economy. This was good for workers and large governments. It was more nationalistic and led, obviously, to the next conflict. But the rise of government planning and government involvement was good for nominal GDPs. It was not good for the asset-holding classes — stocks and bonds did terribly over that period, right? You wanted to be a worker, you wanted to be labor, not capital.

     

    The period from the late 1970s to 1980 changed all that. You had Thatcher and the U.K. and Reagan in the U.S. Mao died in 1976, the Solidarity movement in Poland began in 1978, and the Soviet Union peaked in power in 1979. You saw that the pendulum had gone too far and now we’re going to cut taxes on capital, we’re going to be more globalistic, and trade was going to improve. Since then, capital has risen and assets have done better than labor. Taxes have been light on financial assets and heavy on labor. Everything was reversed on its head.

     

    If we look at the events of 2016 — Brexit, the Italian referendum, Trump, and the rise of nationalist China — are these the harbingers of something bigger? Or are they just a coincidence?  The ground seems to be fertile for things to change globally. If so, does this give rise to a more nationalistic, protectionist, statist scenario?  Are labor prices going to go up again? Are we going to tax capital and emphasize wages?

     

    We’ll see….

    LP: Going back to Trump’s promise to bring jobs back to the U.S. — can the government even do that?

    JC: In the case of the ’30s, you had massive public works spending and government spending, so you created construction workers. But on that front, we’re not going to compete anymore, as the Carrier guy said. Mexican labor is $3 an hour. No amount of retraining for a lower-skilled assembly job is going to change that. The only thing that will replace that Mexican worker himself is a robot. And a robot is infinitely cheaper than even the cheapest labor.

     

    Surveys show that there are jobs open in the economy, but there’s just not a skill level to fill all of them. Our problem is the displacement in things like mining, assembly, low-end manufacturing – that’s where the job losses have occurred. It is just very hard under almost any scenario no matter what your politics are to see where those jobs are going to come back.

     

    To the extent that you have wholesale, large, construction-like projects, then you will put people to work at relatively high rates, but the jobs are episodic and not necessarily career paths. When I was making $14 an hour working steel in Milwaukee in the summers in college, a steel worker could basically say, “all right, as long as I understand that I’m going to work in this factory, I can have a nice living for my family.” Those jobs are gone. The plants closed. So the whole idea that someone can now say, “I can work in the Carrier plant for $20 an hour and be assured of a job for life and security and put my kids through college” — that doesn’t exist anymore.

     

    That’s where the problem and discontent will come — when you’ve sold that dream and it doesn’t happen. In that scenario, Trump begins to have a pretty short honeymoon.

    LP: You’ve long been linked with China. What do you make of the positions of China and the U.S. in the international economy, and how do you think they’re changing?

    JC: To me, the rise of Xi Jinping is a big event still underestimated in the global political economy. He is more of a personality than either Deng Xiaoping or Mao Zedong, certainly higher in stature internally than his predecessors. He is not first among equals in the Politburo Standing Committee — he’s first. This goes along with the theory about the rise of nationalists such at Putin in Russia. Xi Jinping is also a nationalist. He talks about the China Dream, China getting back to past glories, and not exporting communism. What you would have heard Mao say.

     

    He’s a member the Chinese Communist Party, but the Party exists now as a political apparatus, not an ideology. China would not have the type of capitalism it has today if this were not the case. So these are not Marxist-Leninists, but rather just a fantastic single party in control. We have to understand it in that light.

     

    China is increasingly a geostrategic rival. In the past, China looked toward protecting what it had — making claims on Taiwan and Tibet and ancillary areas, but the Chinese were really content not to compete in the global Cold War between the Soviet Union and the United States. Now we have this multi-polar world, and China sees itself clearly as the prime actor in the Pacific willing to fill any vacuum that the United States begins to pull away from.

     

    Xi Jinping comes in and immediately he rewrites the passport maps. He sets the air traffic and extends the air defense zones. More ominously, he begins to militarize the South China Sea, and puts military bases on the islands, which alarms pretty much everybody. (And yet if you look at a map of the Pacific, the only country that really needs to traverse the South China Sea is China itself —oil going from the Middle East to Japan goes around it. The South China Sea is symbolic more than it is geostrategic).

     

    I think, however, that Trump has decided that China makes a convenient media punching bag. You can claim that China took your jobs and China is a bogeyman. It seems to me that president-elect Trump does best when he has someone to fight against. However, the broader issue will be that foreign policy and national security events have a whole different dynamic than beating up on a defense contractor for an air conditioning plant.

     

    What will be the ramifications? How will China react? What do you do about countries like the Philippines that are in the middle — a country that has elected its own interesting president, someone who seems to want to embrace China after decades of being staunchly a U.S. ally? What does this do for Japan? Japan itself has a nationalist, Shinzo Abe, who wants to increase military spending and take off the yoke of the Japanese constitution block on an expanded military.

     

    There are many questions, but whatever you might think, China and Japan, while big trading partners, are not the best of friends in that neighborhood. Finally you’ve got the wacky guy in North Korea. What’s he going to do?

     

    This whole area just keeps quietly but relentlessly getting to be more dangerous. I think that at some point in the first four years of the Trump administration, the Pacific is going to heat up again.

     

    People are talking about starting a trade war with China but they haven’t really thought it through, because if you talk to corporate execs in the United States, they’re sort of quietly terrified.  Often the supply chain, even in U.S. manufacturing, relies on parts from Mexico and China coming in. We are pretty interconnected. Lots of businesses, and workers, too, will get disrupted in ways we can’t even think of in a trade war. There’s a reason why people studied the 1930s with the tariff walls that went up and the disruptions that happened. It’s negative for growth.

     

    So stay tuned, it’s going to be interesting. 

    LP: To turn to Europe, you’re a Greek-American, and you have been critical of the Eurozone’s attitude toward Greece. What do you make of the situation there now?

    JC: The key issues for Greece now revolve around two entities that are not Greek. First you have the EU as a whole. We continue to have these bombshells, like the Italian referendum and Brexit — and you’ve also got elections coming up elsewhere in 2017.

     

    I think Greece was sort of the Spanish Civil War to what’s about to be the EU’s WWII in that it was the opening preview of all of the problems that are going to come to the fore if Catalonia wants to become independent, if Italy wants to leave, if France wants to leave. The EU is being held together by chewing gum and string right now.

     

    With this rise of nationalism  — if that’s what it is and it continues — the EU is going to find itself increasingly a victim of people wanting self-determination in northern Europe. That’s the first thing. Second is something I’m much more concerned about which nobody’s paying attention to, and that’s the continued rise of Erdo?an in Turkey. He has not only consolidated his power through a series of purges —thousands and thousands of journalists and academics have been thrown in prison since the aborted coup — but increasingly he is becoming more militant and Turkey is becoming a pro-Islamic state that is part of NATO. He’s throwing wild monkey wrenches into the whole Middle Eastern situation by making claims on land that was owned by the Ottomans, pre-WWI, like modern-day Iraq, modern-day Syria, and modern-day Greece and Bulgaria. He’s warned the EU that he will open Turkey’s borders to undocumented immigrants if EU membership talks are frozen.  Like Xi Jinping, he’s putting out these old maps and saying: this is our real land. Erdo?an is yet another nationalist.

     

    Poor Greece is at the crossroads of all these seismic events and Ottoman Empire II. You’ve got the possible weakening or dissolution of the EU, and Greek debt problems are about tenth on the list of issues in that region. They’re going to struggle, no doubt about it. Every time the Greek economy starts to show some green shoots, it seems to stall and fall right back down again.

    LP: What do you hope might happen in this emerging world?

    JC: This is the tough thing about being in the financial markets. You can have opinions on all this stuff and either get it wrong or have it not matter.

     

    First, I hope our system of free trade holds up. That’s one thing I believe in fervently. The evidence seems to be that a rise of tariffs and trade walls and barriers will be bad for global growth. Given the debt overhang that’s out there, which is relentless, the ability of economies to service debts in a global trade war will be greatly curtailed, so I’m clearly watching that.

     

    I also continue to be concerned, on a stand-alone basis, with the giant debt bubble occurring in China. It has done nothing but just gotten bigger since you and I last sat down. Despite all the talk of reform, there really hasn’t been any. The Chinese are more reliant on the state than ever — on state lending and state banks. The debt continues to grow at twice the rate of growth, and now the currency is depreciating.

     

    We’re getting a situation where the Chinese economy is still a very important driver of global growth, but increasingly it is using the old methods that the Chinese themselves said only a few years ago that they would have to change. But they can’t, because every time they try, the economy slows too fast.

     

    China continues to be half of the demand for global commodities. It basically supports Africa and countries like Australia and Brazil. Almost 40 percent of global GDP is either China or commodity-exporting countries whose prime market is China. That’s considerable. So we have to look not only at China’s role with us, but China’s role on its own because it is such a driver for global growth, Chinese growth represents 1 point of the 3 percent GDP growth, so if China were not growing at all, we’d be at 2 percent. Doesn’t sound like a lot but it is. We have to keep our eye on what’s going on there. A global trade war would probably send China into a really steep recession.

     

    How would an average worker navigate a rising trade barrier globally? It’s scary. If we look back at the ’30s template, one major outlet was, of course, a giant arms race. By the late ’30s, you had the whole world realizing the threats of fascism and rearming rapidly. Keynesian government spending was what pulled up the economies; it just had some really bad repercussions from 1939-45. But if we get into any kind of global arms race with China, either conventionally or otherwise, that would be Reagan-like. I don’t know what the numbers would mean in terms of employment, but you would take a lot of manufacturing people and turn them to making other things. 

    LP: How do you rate the current moment with big periods of change you’ve seen in your lifetime?

    JC: I had this odd personal journey from being a union pipefitter and boilermaker as a college student — I made more money in two-and-a-half months making steel than I did my first year on Wall Street. I went from being a product of the industrial Midwest and putting myself through college by working in a steel mill, to being the beneficiary of the Reagan-Thatcher era. I saw the world change, but I didn’t really understand until years later what an important period the late ’70s/early ’80s was (and a great period for music, by the way!).

     

    If we’re in one of those periods now, if 2016 is like 1932 or 1979 — then you not only have to change your portfolio, you have to change your lifestyle. That’s one of the things we’ve been telling clients. If this is a major shift to populism, nationalism, greater state involvement, and less globalism, then you really have to rethink almost everything in your life.

     

    Certainly, if you were a capitalist in 1932, you might be best served to change your outlook. And if you were a union leader in 1979, it would have been good to change your outlook. The question will be, in 2016, would it be best for the Davos man and woman, the globalists, to change their outlook?

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Jan 11

Today’s News 11th January 2017

  • Bill Blain: "Throughout My Career, Years Ending In 7 Haven’t Been Good"

    While we wish one of our favorite market commentators’, Mint’s Bill Blain, all the best as he recovers from his recent heart attack, we would like to share with readers his inaugural for 2017 note, which lays out his current concerns about the state of the markets, and the global economy.

    From the January 10 edition of Blain’s Mid-Morning Porridge

    Let me start by stating the issues causing me some worry:

    Throughout my career, years ending in 7 haven’t been good.

    1987 saw a massive stock market crash, in 1997 we got the Asian Financial Crisis, and 2007 saw the start of the Global Financial Crisis and consequences we’re still struggling with today. In the case of year 7s, the trend is not our friend.

    I’m told by my stock picking chartists there is a 10-yr stock cycle that looks to have peaked. Many factors about this succession of market turnaround moments worry me – firstly, the scale of crisis seems to be multiplying as each 10-yrs event. A simple stock market rout in 1987 became near global catastrophe in 2007.

    Thankfully we haven’t ever had the kind of absolute global market meltdown doomsters say will happen, but it does strike me that market moves – whether caused by an evil conjunction of rogue algorithims and Hi-Speed-Trading, or simple human foolishness – are becoming increasingly chaotic, thus raising the scale of crashes.

    The second aspect is how financial crisis are solved. Each is new – but it worries me the efforts made to ensure the last crisis doesn’t happen again may contribute to the causes the next one. I certainly don’t believe the deluge of regulatory tat since 2008 has made the world safer. It has not… it has made it more.. difficult. It’s a game of consequences…

    And change is definitely coming…

    I’ve been looking at the dismal science of Economics. It’s proper name is political economy and its not a proper science. It’s a language for understanding complex events and responding to them,rather than mathematical rules. Over the past 10-years we’ve seen a massive economic experiment in monetary economics. It’s hasn’t gone well. It strikes me the legions of central bank economists are akin to the ancient alchemists looking to change base metal into gold….

    The piper will soon want paid. The next phase – underway already – will be a reversal back to fiscal economics. That one potentially positive reality for the US and UK, but yet another minefield for Europe. It’s a big if to see whether Trump delivers the fiscal boost the market expects, or whether the continued weakness of sterling continues to push the FTSE into the stratosphere. I have my doubts…!
    In Europe a swing towards Fiscal policy spells crisis.

    The fact that France and Italy could be steaming towards fiscal stimuli will break the current ECB monetary consensus, while Germans become increasing strident about the need for higher rates and an end to QE. Add to that a hefty dose of European politics. Dutch Elections, French Elections and the Germans.. its all much to worry about. 

  • U.S. Intelligence Agencies Have No Clothes

    Submitted by Mike Krieger via Liberty Blitzkrieg blog,

    The true patriotism, the only rational patriotism is loyalty to the nation all the time, loyalty to the government when it deserves it.

     

    – Mark Twain, The Czar’s Soliloquy”

    At this point, pretty much everyone in America has seen the results of Hillary Clinton media pet, John Harwood’s recent Twitter poll.

    The significance of the above cannot be overstated. U.S. intelligence agencies, like so many other national institutions, have lost nearly all credibility in the eyes of the American public. The list is long, but includes economists, politicians, the mainstream media, central bankers, the financial system, and a lot more. The loss in credibility is well deserved and has nothing to do with Russia. Rather, it’s a function of a disastrous 21st century outcome for U.S. citizens both at home and abroad. A result that was achieved under eight years of Republican rule and then eight years of Democratic rule. The results were the same whether a donkey or elephant was in charge, because the people determining policy behind the scenes never really changed (same economists, central bankers, intelligence officials, etc), and the people selling the catastrophic policies to the public definitely never changes (mainstream media and its worthless pundits).

    So here we stand at a moment where trust in essentially all U.S. institutions is at a well deserved all-time low, and the best the establishment can come up with is to blame Russia. Even worse, those pushing the whole “Putin is to blame for everything” conspiracy theories, consistently refuse to back up their assertions with any evidence whatsoever. In fact, with each passing week the case looks increasingly flimsy, with the latest declassified document issued Friday being particularly suspect. Even many of those largely convinced of Russia’s meddling in the U.S. election admit the most recent report was pathetic, embarrassing and proved absolutely nothing.

    Robert Parry of Consortium News summarizes the farce perfectly in his recent piece U.S. Report Still Lacks Proof on Russia ‘Hack’. Here’s how he begins the article:

    Repeating an accusation over and over again is not evidence that the accused is guilty, no matter how much “confidence” the accuser asserts about the conclusion. Nor is it evidence just to suggest that someone has a motive for doing something. Many conspiracy theories are built on the notion of “cui bono” – who benefits – without following up the supposed motive with facts.

     

    But that is essentially what the U.S. intelligence community has done regarding the dangerous accusation that Russian President Vladimir Putin orchestrated a covert information campaign to influence the outcome of the Nov. 8 U.S. presidential election in favor of Republican Donald Trump.

     

    Just a day after Director of National Intelligence James Clapper vowed to go to the greatest possible lengths to supply the public with the evidence behind the accusations, his office released a 25-page report that contained no direct evidence that Russia delivered hacked emails from the Democratic National Committee and Hillary Clinton’s campaign chairman John Podesta to WikiLeaks.

     

    The DNI report amounted to a compendium of reasons to suspect that Russia was the source of the information – built largely on the argument that Russia had a motive for doing so because of its disdain for Democratic nominee Clinton and the potential for friendlier relations with Republican nominee Trump.

     

    But the report’s assessment is more than just a reasonable judgment based on a body of incomplete information. It is tendentious in that it only lays out the case for believing in Russia’s guilt, not reasons for doubting that guilt.

     

    For instance, while it is true that many Russian officials, including President Putin, considered Clinton to be a threat to worsen the already frayed relationship between the two nuclear superpowers, the report ignores the downside for Russia trying to interfere with the U.S. election campaign and then failing to stop Clinton, which looked like the most likely outcome until Election Night.

     

    If Russia had accessed the DNC and Podesta emails and slipped them to WikiLeaks for publication, Putin would have to think that the National Security Agency, with its exceptional ability to track electronic communications around the world, might well have detected the maneuver and would have informed Clinton.

     

    So, on top of Clinton’s well-known hawkishness, Putin would have risked handing the expected incoming president a personal reason to take revenge on him and his country. Historically, Russia has been very circumspect in such situations, usually holding its intelligence collections for internal purposes only, not sharing them with the public.

    Another very good breakdown of the clownishness of the latest intel report was written by noted anti-Putin activist Masha Gessen in The New York Review of Books. Like many others, she finds the obsession with RT within the report bizarre to say the least. She notes:

    Finally, the bulk of the rest of the report is devoted to RT, the television network formerly known as Russia Today.

     

    A seven-page annex to the report details RT activities, including hosting third-party candidate debates, broadcasting a documentary about the Occupy Wall Street movement and “anti-fracking programming, highlighting environmental issues and the impacts on public health”—perfectly appropriate journalistic activities, even if they do appear on what is certainly a propaganda outlet funded by an aggressive dictatorship. An entire page is devoted to RT’s social media footprint: the network appears to score more YouTube views than CNN (though far fewer Facebook likes). Even this part of the report is slightly misleading: RT’s tactics for inflating its viewership numbers in order to secure continued Kremlin funding has been the subject of some convincing scholarship. That is the entirety of the case the intelligence agencies have presented: Putin wanted Trump to win and used WikiLeaks and RT to ensure that outcome.

    Indeed, it appears the intelligence community is more concerned that RT is doing a better job than U.S. journalists at covering issues Americans care about than it is about Russia “hacking the election.” She also concludes:

    Despite its brevity, the report makes many repetitive statements remarkable for their misplaced modifiers, mangled assertions, and missing words. This is not just bad English: this is muddled thinking and vague or entirely absent argument…

     

    It is conceivable that the classified version of the report, which includes additional “supporting information” and sourcing, adds up to a stronger case. But considering the arc of the argument contained in the report, and the principle findings (which are apparently “identical” to those in the classified version), this would be a charitable reading. An appropriate headline for a news story on this report might be something like, “Intel Report on Russia Reveals Few New Facts,” or, say, “Intelligence Agencies Claim Russian Propaganda TV Influenced Election.” Instead, however, the major newspapers and commentators spoke in unison, broadcasting the report’s assertion of Putin’s intent without examining the arguments.

    Which brings me to the biggest red flag in the entire intelligence report. The part where it states:

    We also assess Putin and the Russian Government aspired to help President-elect Trump’s election chances when possible by discrediting Secretary Clinton and publicly contrasting her unfavorably to him. All three agencies agree with this judgment. CIA and FBI have high confidence in this judgment; NSA has moderate confidence.

    If any agency should have high confidence it’s the NSA, and pretty much every security expert I follow seems to agree. First, here’s what Bruce Schneier wrote in his recent piece, Attributing the DNC Hacks to Russia:

    Attribution is easier if you are monitoring broad swaths of the Internet. This gives the National Security Agency a singular advantage in the attribution game. The problem, of course, is that the NSA doesn’t want to publish what it knows.

    Isn’t that interesting. The one agency with the most information is the one least confident in the conclusion. Why only moderate confidence from the NSA? I wonder.

    Schneier isn’t the only one of course. As famed NSA whistleblower William Binney noted in a recent article coauthored with Ray McGovern, The Dubious Case on Russian ‘Hacking’:

    With respect to the alleged interference by Russia and WikiLeaks in the U.S. election, it is a major mystery why U.S. intelligence feels it must rely on “circumstantial evidence,” when it has NSA’s vacuum cleaner sucking up hard evidence galore. What we know of NSA’s capabilities shows that the email disclosures were from leaking, not hacking.

    Here’s the difference:

     

    Hack: When someone in a remote location electronically penetrates operating systems, firewalls or other cyber-protection systems and then extracts data. Our own considerable experience, plus the rich detail revealed by Edward Snowden, persuades us that, with NSA’s formidable trace capability, it can identify both sender and recipient of any and all data crossing the network.

     

    Leak: When someone physically takes data out of an organization — on a thumb drive, for example — and gives it to someone else, as Edward Snowden and Chelsea Manning did. Leaking is the only way such data can be copied and removed with no electronic trace.

     

    Because NSA can trace exactly where and how any “hacked” emails from the Democratic National Committee or other servers were routed through the network, it is puzzling why NSA cannot produce hard evidence implicating the Russian government and WikiLeaks. Unless we are dealing with a leak from an insider, not a hack, as other reporting suggests. From a technical perspective alone, we are convinced that this is what happened.

    Again, if any agency should have high confidence, it is the NSA.

    Moving along, the U.S. government’s case gets even weaker the more you dig into it. A perfect example can be seen in how poorly State Department spokesman Robert Kirby handled a few questions during a recent press conference. Here’s the clip:

    Three major red flags appear in this exchange. First, Mr. Kirby admits that no evidence has been provided to the public regarding Russian hacking and distribution of information to Wikileaks, and that none would be forthcoming.

    Second, Mr. Kirby repeatedly insists that the fact “all 17 intelligence agencies” came to the same conclusion should be sufficient for the American public in the absence of any actual proof. To this I reply:

    I don’t know about you, but the fact that seventeen agencies representing a bipartisan status quo that has been catastrophically wrong about pretty much everything came to the same conclusion, does not inspire confidence or credibility in the mind of this citizen.

    Finally, there’s red flag number three. When AP reporter Matt Lee follows up wondering why the WMD assessment debacle holds no relevance to the current intelligence assessment, Mr. Kirby responds by highlighting all of “the kinds of gains that have been made in intelligence and analysis since then.”

    Here’s the problem. The Director of National Intelligence (DNI), James Clapper does not have clean hands when it comes to the WMD affair. He also blatantly lied to the American people with regard to NSA surveillance before being called out by Edward Snowden. As Binney and McGovern explain:

    Mr. Trump’s skepticism is warranted not only by technical realities, but also by human ones, including the dramatis personae involved. Mr. Clapper has admitted giving Congress on March 12, 2013, false testimony regarding the extent of the National Security Agency’s collection of data on Americans. Four months later, after the Edward Snowden revelations, Mr. Clapper apologized to the Senate for testimony he admitted was “clearly erroneous.” That he is a survivor was already apparent by the way he landed on his feet after the intelligence debacle on Iraq.

     

    Mr. Clapper was a key player in facilitating the fraudulent intelligence. Defense Secretary Donald Rumsfeld put Mr. Clapper in charge of the analysis of satellite imagery, the best source for pinpointing the location of weapons of mass destruction — if any.

     

    When Pentagon favorites like Iraqi émigré Ahmed Chalabi plied U.S. intelligence with spurious “evidence” on WMD in Iraq, Mr. Clapper was in position to suppress the findings of any imagery analyst who might have the temerity to report, for example, that the Iraqi “chemical weapons facility” for which Mr. Chalabi provided the geographic coordinates was nothing of the kind. Mr. Clapper preferred to go by the Rumsfeldian dictum: “The absence of evidence is not evidence of absence.” (It will be interesting to see if he tries that out on the President-elect Friday.)

     

    A year after the war began, Mr. Chalabi told the media, “We are heroes in error. As far as we’re concerned we’ve been entirely successful.” By that time it was clear there were no WMD in Iraq. When Mr. Clapper was asked to explain, he opined, without adducing any evidence, that they probably were moved into Syria. 

    To conclude, I certainly think it is important to know if the Russian government hacked the DNC/Podesta and then handed that information to Wikileaks. Likewise, such an explosive claim necessitates publicly available evidence given the horrible track record of U.S. intelligence agencies. Until such evidence is made available I, like countless other Americans, will tend to believe Wikileaks, which has a track record of proving its claims and being accurate, as opposed to U.S. intelligence, which doesn’t.

  • Caught On Tape: U.S. Immigration Official Okays Syrian Immigrants With "Fake Passports"

    Over the past several months, we have frequently noted the staggering increases in the number of refugees Obama has permitted into the United States just as his Presidency is winding down.  In fact, just a couple of weeks ago, we noted that in the first 84 days of the 2017 fiscal year (October 1, 2016 – December 23, 2016), the Obama administration has accepted 25,584 refugees into the United States, an 86% increase year-over-year (see “Refugee Admissions Surge 86% YoY As Obama Rushes Arrivals Ahead Of Trump Inauguration“).  And while we were expecting a large increase in refugee admittances in 2017 (see “Hillbama Administration Plans To Admit At Least 110,000 Refugees In 2017“), the ~30% increase that Secretary John Kerry estimated back in September is looking like a fairly modest increase now compared to the actual numbers. 

    Meanwhile, just a few weeks ago we pointed out that European officials finally admitted that refugees were being directly recruited by ISIS both in Syria and in migrant camps throughout Europe to carry out terrorist attacks (see “Europol Admits ISIS Actively Targeting Refugees To Carry Out Terrorist Attacks In The EU“).

    Confirming what most of us deduced long ago via the application of just a bit of common sense, Europol and Frontex, Europe’s  border and coast guard agency, are finally admitting that their intelligence indicates coordinated efforts on the part of ISIS to recruit asylum seekers, both in Syria and in migrant camps after they’ve already reached Europe, to carry out terrorist attacks.  In a report published by Europol, counter-terrorism experts warn that, among other things, “Syrian refugee diaspora may become vulnerable to radicalisation once in Europe and may be specifically targeted by Islamic extremist recruiters.”

    But, here in the U.S. there should be no similar cause for concern because Josh Earnest has assured us that “significant screening was put in place to ensure that these [refugees] don’t pose an undue threat to our national security.”

    And while we have no doubt in the Obama administration’s commitment to a rigorous vetting process, we were somewhat alarmed by an undercover video revealed earlier today by the Daily Caller which seems to show a U.S. Immigration Services official in New York coaching a woman on how to help a Syrian family gain asylum in the US with “fake passports”…a situation which the official describes as “far from unique.”

    “The fake passport is one thing, we are going to use the name that is on the passport as AKA, also known as,” the man identified as Sergio responded. He added, “chances are considering the situation in Syria, they are not going to be sent back.”

     

    The USCIS employee went on to say, “Was there ever a situation where people came with fraudulent documents and qualified for asylum? Yes, because it’s understood that they can not always obtain genuine documents. So it’s far from being unique.”

    Of course, when the Daily Caller attempted to confirm whether granting asylum to refugees with “fake passports” was indeed “far from unique,” they were courteously referred to a website for further assistance with their concerns.

    The Daily Caller asked the USCIS if giving asylum to immigrants with fake documents is “far from unique” like the USCIS employee said in the video. A spokesperson responded by saying they do not “publicly discuss individual immigration cases” and giving a link to a information on their refugee and asylum programs.

     

    A USCIS spokesperson also said that the agency cannot confirm the authenticity of the video as they claim it is heavily edited. The USCIS did not confirm nor deny that Sergio is an employee with the agency.

     

    TheDC has previously reported on an internal Immigration and Customs Enforcement memo which states difficulty in preventing fraud in the refugee program as “bad actors” use false biographies and “produce and submit fictitious supporting documentation.” It has also been reported that the Islamic State has a thriving fake passport industry.

     

    Guess there is really no need for the elaborate games when you can just walk straight through the front door…

    Refugee ISIS

  • Fed Remits Only $92 Billion To Treasury In 2016, Lowest Since 2013

    The world was reminded of the cozy relationship between The Fed and The Treasury again today as Janet sent Jack $92.0 billion of freshly ponzi'd net income for 2016 providing the federal government with an important source of funding. This, however, is down almost 6% from 2015 and despite a considerably larger balance sheet is the lowest remittance since 2013 due to doubling the handouts to the major banks to $12 billion last year.

    As Reuters reports, part of the decline is due to a drop of about $2.6 billion in what the Fed earns on its holdings of U.S. Treasury bonds and mortgage-backed securities accumulated in fighting the 2007 to 2009 financial crisis.

    But most of it is a result of the interest paid on excess reserves held by commercial banks at the 12 regional Federal Reserve institutions. Banks are required to hold some reserves, but are allowed to deposit more if they choose.

     

    Between more cautious lending and weak economic growth, total reserves have been at historically high levels since the financial crisis — roughly $2 trillion as of the end of the last year compared with a few billions of dollars in more typical times.

     

    When the Fed increased its target interest rate in Dec. 2015 by a quarter of a percentage point, to a range of between 0.25 and 0.5, it increased the rate paid to banks as well – and pushed its overall reserve interest costs from $6.9 billion in 2015 to $12 billion last year.

     

    The increase may draw attention from lawmakers who have been critical of the Fed paying money to large commercial institutions. The central bank argues that the payments are its most effective way to push rates higher: by offering interest on excess reserves, the Fed forces banks to raise the rate at which they are willing to lend to each other.

    In the last 15 years, The Fed has handed over $880 billion to The Treasury…

    Source: The Fed

    As is clear in the chart above, a decade ago, back when the Fed was a smaller size, Fed remittances were fairly steady, in the neighborhood of $20 billion a year. This all changed after 2008 as the Fed’s Quantitative Easing programs increased the amount of interest-earning assets that would generate funds to transfer back to the Treasury.

    Big Bucks for the US Treasury

    For the US Treasury, Fed remittances are something of a free lunch. When someone buys a Treasury bond, the government must pay them interest. This applies to the Fed as well, but then at year-end the Fed remits the interest back to the Treasury.

    As we noted previously, in more “normal” times (i.e., prior to 2008) around 7 percent of the Treasury’s interest payments were paid back to it by the Fed. This figure has grown to over three times that amount over the past few years…

    Implications for Fed “Independence”

    As much as economists talk about the independence that the Fed holds from Congress, these remittances represent a strong link. In fact, since they enable federal spending they create a form of quasi-fiscal policy for the Fed to use, in addition to its more common monetary policy options.

    Consider that since Treasury debt is almost never repaid in net terms (old issues are retired but replaced with new debt issuances), the true cost of financing the US government’s borrowing is not the gross amount of debt outstanding but the annual interest expense it faces. Viewed this way, nearly half of the Treasury’s borrowing was financed by the Fed last year. Absent these Fed remittances, Congress would need to look at either an alternative funding source (though I am not sure how many takers there are for the Fed’s $2.5 trillion Treasury holdings) or make some serious cuts.

    How serious? NASA’s operating budget was roughly $18 billion last year, so a lack of Fed remittances would cause the Treasury to cut around five NASA-sized programs. Alternatively, the governments Supplemental Nutrition Assistance Program (previously known as “food stamps”) cost $70 billion in 2014. Without the Fed’s remittances, Congress would have to stop paying out all food stamp recipients plus it would be forced to defund almost two NASAs.

    More important in many Americans’ hearts is their monthly social security check. In 2014, $830 billion of social security checks were mailed out. Without Fed remittances, retirees might see their monthly check cut by about 12 percent.

    For those concerned with the burgeoning size of the federal government, putting a stop to Fed remittances would put a serious dent in public finances and force some serious thought as to what programs need to be cut.

  • Taiwan Scrambles Jets, Navy After Chinese Aircraft Carrier Group Enters Taiwan Strait

    While much of America was preparing to listen to Obama speak one final time, the Chinese had far less lofty ambitions, and on Wednesday morning Beijing sent a group of Chinese warships led by China’s sole aircraft carrier north through the Taiwan Strait, resulting in Taiwan scrambling jets and navy ships in the latest sign of heightened tensions between China and the self-ruled Taiwan.

    According to Reuters, The Soviet-built Liaoning aircraft carrier, returning from exercises in the South China Sea, was not trespassing in Taiwan’s territorial waters but entered its air defense identification zone (ADIZ) in the southwest, Taiwan’s defense ministry said.


    China’s Liaoning aircraft carrier conducts a drill in an area of South China Sea,
    in this undated photo taken December, 2016

    As a result Taiwan scrambled jets and navy ships to “surveil and control” the passage of the Chinese ships through the narrow body of water separating Taiwan and China. “We have full grasp of its movements,” Taiwan defense ministry spokesman Chen Chung-chi said.

    The defense ministry spokesman added that the Taiwanese military aircraft and ships have been deployed to follow the carrier group, which is sailing up the west side of the median line of the strait.

    Previously, China has said the Liaoning aircraft carrier was on drills to test weapons and equipment in the disputed South China Sea and its movements comply with international law.

    As Reuters adds, the latest Chinese naval exercises have unnerved Beijing’s neighbors, especially Taiwan which Beijing claims as its own, given long-running territorial disputes in the South China Sea. China claims most of the energy-rich waters of the South China Sea, through which about $5 trillion in ship-borne trade passes every year. Neighbors Brunei, Malaysia, the Philippines, Taiwan and Vietnam also have claims.

    While China traditionally distrusts Taiwan, and especially the new President Tsai Ing-wen, it has has stepped up pressure on her following a protocol-breaking, congratulatory telephone call between her and U.S. President-elect Donald Trump last month.

  • 4Chan Claims To Have Fabricated Anti-Trump Report As A Hoax

    In a story that is getting more surreal by the minute, a post on 4Chan now claims that the infamous “golden showers” scene in the unverified 35-page dossier, allegedly compiled by a British intelligence officer, was a hoax and fabricated by a member of the chatboard as “fanfiction”, then sent to Rick Wilson, who proceeded to send it to the CIA, which then put it in their official classified intelligence report on the election.

    Here is 4Chan’s explanation of how the story came to light:

    >/pol/acks mailed fanfiction to anti-trump pundit Rick Wilson about trump making people piss on a bed obama slept in

    >he thought it was real and gave it to the CIA

    >the central intelligence agency of the united states of america put this in their official classified intelligence report on russian involvement in the election

    >donald trump and obama have both read this pol/acks fanfiction

    >the cia has concluded that the russian plans to blackmail trump with this story we made up

    just let that sink in what we have become.

     

    And a summary posted on pastebin:

    On january 10, Buzzfeed posted a story under the byline of Ken Bensinger, Mark Schoofs and Miriam elder titled “these reports Allege Trump Has Deep Ties To Russia” and posted a link to a document alleging, among other things, that russia has been cultivating trump for 5+ years, that trump has been in constant contact with the kremlin for information on his opponents, and perhaps most inflammatory, that there are many recorded instances of blackmail of trump in sexual misconduct. A prominent claim is that trump rented the presidential suite of the Ritz Carlton Hotel in moscow, where he knew that the Obamas had slept in; he them hired a number of prostitutes to perform a ‘golden shower’ (pissplay) on the bed and in the room. https://www.buzzfeed.com/kenbensinger/these-reports-allege-trump-has-dee…
    https://assets.documentcloud.org/documents/3259984/Trump-Intelligence-Al…

     

    Noted #nevertrump voice Rick Wilson later commented on twitter, stating that the report “gave a new meaning to Wikileaks” (https://twitter.com/TheRickWilson/status/818982395202379777) and that the report was the reason everybody was fighting so hard against the election of Trump. (https://twitter.com/TheRickWilson/status/818983514335047680)

     

    The remarkable thing? It’s all fake. And not only fake; it’s a prank perpetuated by 4chan, on Rick Wilson himself. A post on 4chan on october 26 stated “mfw managed to convince CTR and certain (((journalists))) on Twitter there’ll be an October surprise on Trump this Friday” along with a picture of a smug face with a hash name. http://archive.4plebs.org/pol/thread/94704894/#94705224

     

    on november 1, a person without a picture but is assumed to be the same person posted “So they took what I told Rick Wilson and added a Russian spy angle to it. They still believe it. Guys, they’re truly fucking desperate – there’s no remaining Trump scandal that’s credible.” https://archive.4plebs.org/pol/thread/95568919/#95571329

     

    on january 10, moments after the story broke and began to gain traction on social media, a person with the same smug grin face, and the same hash title for the picture, stated “I didn’t think they’d take it so far.” http://boards.4chan.org/pol/thread/106514445#p106520376

     

    This story has taken on something of a life of it’s own. Going through Rick Wilson’s twitter, you can find many different stories from the time that he had shown the story to a wide number of anti-trump news sources, trying to find a news organization that would actually publish the story. During that time period, he referred to it often as ‘the thing’, and often playing coy with followers on the content with the story with anybody who was not also a #Nevertrumper. Unconfirmed sources has people as high up as John McCain giving the story to FBI Director James Comey to attempt to verify the story. Given that Rick Wilson runs in Establishment circles, it is not an impossible scenario that long-serving senators are falling for what amounts to a 4chan troll trump supporter creating an ironic October Surprise out of wholecloth to punk a GOPe pundit who derogatorily referred to them as single men who masturbate to anime.

    While this entire incident is laughable, and even more so if the 4Chan account is accurate, what makes it quite tragic, is that it is no longer possible to dismiss the “fake news” angle to an intelligence report. And if the CIA is compromised, what is left for “news outlets” like CNN and BuzzFeed, which were all too eager to run with the story without any attempt at verification?

  • Hungary To Launch Crackdown On All George Soros-Funded Organizations

    In a dramatic example of blowback against the establishment in the post-Trumpian world, Hungary announced it plans to crack down on non-governmental organizations linked to billionaire George Soros now that Donald Trump will occupy the White House, according to the deputy head of Prime Minister Viktor Orban’s party, cited by Bloomberg.

    The European Union member, and native country of Soros, will use “all the tools at its disposal” to “sweep out” NGOs funded by the Hungarian-born financier, which “serve global capitalists and back political correctness over national governments,” Szilard Nemeth, a vice president of the ruling Fidesz party, told reporters on Tuesday. No one answered the phone at the Open Society Institute in Budapest when Bloomberg News called outside business hours.

    “I feel that there is an opportunity for this, internationally,” because of Trump’s election, state news service MTI reported Nemeth as saying. Lawmakers will start debating a bill to let authorities audit NGO executives, according to parliament’s legislative agenda.

    As a reminder, Orban was the first European leader to publicly back Trump’s campaign, and was reportedly invited by Trump to visit the US; he has ignored criticism from the European Commission and U.S. President Barack Obama’s administration for building a self-described “illiberal state” modeled on authoritarian regimes including Russia, China and Turkey. In 2014, Orban personally ordered the state audit agency to probe foundations financed by Norway and said that civil society groups financed from abroad were covers for “paid political activists.” As a result of Trump’s victory, Orban has felt empowered to further last out against Europe’s established structures, and its core supporters.

    As Bloomberg notes, Orban and his administration have repeatedly singled out NGOs supported by Soros, a prominent Hillary Clinton and Democratic Party supporter, with a wide network of organizations that promote democracy in formerly communist eastern Europe.

    Orban is not alone: Trump has also accused the 86-year-old billionaire of being part of “a global power structure that is responsible for the economic decisions that have robbed our working class, stripped our country of its wealth and put that money into the pockets of a handful of large corporations and political entities.” In a pre-election commercial, he showed images of Soros along with Federal Reserve Chair Janet Yellen, and Goldman Sachs Group Inc. CEO Lloyd Blankfein, all of whom are Jewish. The Anti-Defamation League criticized the ad for touching on “subjects that anti-Semites have used for ages.”

    Since then things have changed, however, and Trump has retained the services of two prominent Goldman alumni, Steven Mnuchin and Gary Cohn, to serve on his administration. His current thinking on George Soros is unknown.

  • Live Stream: Obama Says Farewell; Reminds Us One Last Time How Awesome He Is

    Once again parting with Presidential tradition, rather that delivering his farewell speech from the oval office, the ever so humble Obama has decided to give his final address to the American people from his home town of Chicago.  And, like his 2008 speech at the Democratic National Convention in Denver, we're certain this will be a glorious event complete with a slew of celebrities and all the pomp and circumstance befitting a king…rest assured that no taxpayer expense was spared.

    While the content of Obama's remarks have not been revealed, earlier today he posted the following preview on Facebook which noted that he looks forward to going back to "where it all started" and humbly affirmed that he's "made America a better, stronger place for the generations that will follow."

    For Michelle and me, Chicago is where it all started. It’s the city that showed us the power and fundamental goodness of the American people.

     

    It’s that inherent strength that brought our country through our fair share of challenges these last eight years. Because of you, we’ve come through them stronger. Because of you, we’ve held to a belief that has guided us ever since our founding – our conviction that, together, we can change this country for the better.

     

    It’s easy to lose sight of that in the blizzard of our minute-to-minute Washington news cycles. But America is a story told not minute to minute, but generation to generation – a story written by parents, and teachers, and veterans, and neighbors who’ve taken on the call of citizenship, working together, without fanfare, to form a more perfect union.

     

    Over the course of my life, I’ve been reminded time and again that change can happen – that ordinary people can come together to achieve extraordinary things. And I’ve seen that truth up close over these last eight years.

     

    We’ve made America a better, stronger place for the generations that will follow. We’ve run our leg in a long relay of progress, knowing that our work will always be unfinished. And we’ve reaffirmed the belief that we can make a difference with our own hands, in our own time. That’s the imperative of citizenship – the idea that, with hard work, and a generous heart toward our fellow Americans, people who love their country can change it.

     

    So tonight, I’m returning to where it all began to offer my most grateful farewell to the American people. I hope you’ll join me – I want to thank you for everything you’ve done.

    And while Obama will undoubtedly brag about his amazing "economic recovery," we would once again highlight the following data that seemingly paints a slightly more sobering picture.

    Harvard

     

    Of course, these charts that we presented last summer also cast a slight shadow over Obama's "economic recovery." 

     

    Unfortunately for Obama, simply stating something repeatedly doesn't actually make it a fact. 

    And speaking of repeating fictitious stories until they somehow become fact, as Post News pointed out yesterday, for weeks now Obama and his various mouthpieces have been peddling the fiction that his administration managed to spend 8 years in the White House without a single major scandal.  And while that would be a fantastic accomplishment, unfortunately it's every bit as "fake" as the Obama "economic recovery."  In fact, here are just a few of the scandals that plagued the Obama administration over the years (a detailed description of each can be viewed here).

    • Iran Nuclear Deal and Ransom Payment
    • NSA Spying
    • Benghazi
    • Operation Fast and Furious
    • Eric Holder – First Attorney General Ever Held In Contempt Of Congress
    • IRS Targeting Of Conservative Groups
    • Bowe Bergdahl
    • The Great “Stimulus” Heist
    • Solyndra
    • Spying On Journalists
    • VA Death-list Scandal

    Finally, since Obama will undoubtedly use his pedestal tonight to defend his one crowning piece of legislation, in a last-ditch effort to save it from being repealed by the incoming Trump administration, we leave you with the following charts displaying the epic collapse of Obamacare in just 1 year as insurers pulled out of exchanges all around the country in 2017 leaving Americans with minimal insurance options and substantially higher premiums.

     

    2016 healthcare insurance carriers by county:

    Obamacare 2016

     

    2017 healthcare insurance carriers by county:

    Obamacare 2017

     

    With that intro, here is Obama's farewell speech for your viewing pleasure:

     

  • China's Exorbitant Detriment (Mirror Image Of America's Exorbitant Privilege) Is Costing It Dearly

    Submitted by Benn Steil and Emma Smith via The Council on Foreign Relations,

    The so-called Exorbitant Privilege of the United States, the power to conjure the world’s primary reserve currency, is reflected in the unique combination of being deeply in debt to the rest of the world (that is, having a massive negative net international investment position, or NIIP) while earning far more income abroad than it pays out in interest (that is, having massive positive annual net investment income, or NII).  The U.S. NIIP averaged negative $7.5 trillion over FY15/16, while its NII was positive $167 billion, as shown in the top left of the graphic below.  Basically, foreigners are willing to accept a trivial return to hold dollar-denominated assets.

     

    Far less well known is the mirror-image of the Exorbitant Privilege, or what we might call the Exorbitant Detriment.

    It is, not surprisingly, borne by China.  It is, to some extent, the price the country bears as the world’s largest holder of dollar-denominated central bank reserves.  Reserves account for half of China’s foreign assets, of which around 40 percent are invested in low-yielding U.S. Treasury securities.  But it also reflects the fact that China is lending to the rest of the world at paltry rates.  Chinese government institutions lend to Chinese, as well as foreign, firms operating abroad far more cheaply than alternative lenders. This reflects the Chinese government’s efforts both to subsidize its companies and to strengthen economic ties with resource-rich countries in, for example, Africa and Latin America.  China’s Exorbitant Detriment is reflected in an NIIP of $1.6 trillion and NII of negative $80 billion in FY15/16.

    Can China continue supporting its Exorbitant Detriment indefinitely?

    Not if it wants to prioritize a halt to reserve sales, which have been necessitated by capital outflows.  Negative investment income reduces the current account surplus, and therefore the amount of capital that can leave the country before the central bank has to match outflows with reserve sales. If China’s investment income balance had been zero over FY15/16 it would, all else being equal, have been able to absorb an additional $80 billion of capital outflows before having to sell reserves.  This is equivalent to 17 percent of the actual decline in reserves over this period.  China’s reserves fell to $3 trillion in December and, as we pointed out in an earlier post, could actually fall to what the IMF reserve-analysis rubric would deem dangerously low levels by summer if outflows continue at the pace seen over the last three months.  China can slow this decline by demanding higher returns on its lending abroad, but this will require sacrificing its efforts to subsidize its companies as well as those aimed at putting dollars to the service of geostrategic objectives.

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Jan 10

Today’s News 10th January 2017

  • We All Lose: Obama's Legacy And What It Means For A Trump Presidency

    Submitted by John Whitehead via The Rutherford Institute,

    “This light of history is pitiless; it has a strange and divine quality that, luminous as it is, and precisely because it is luminous, often casts a shadow just where we saw a radiance; out of the same man it makes two different phantoms, and the one attacks and punishes the other, the darkness of the despot struggles with the splendor of the captain. Hence a truer measure in the final judgment of the nations. Babylon violated diminishes Alexander; Rome enslaved diminishes Caesar; massacred Jerusalem diminishes Titus. Tyranny follows the tyrant. Woe to the man who leaves behind a shadow that bears his form.” ? Victor Hugo, Les Misérables

    Let’s talk about President Obama’s legacy, shall we?

    This was a candidate who was ushered into office promising hope and change, pledging to put an end to the endless wars that were bankrupting the country (he was actually awarded the Nobel Peace Prize in anticipation of his efforts to bring about world peace), and vowing to put an end of the corporate revolving door that had turned our republic into an oligarchy.

    After eight years in office, Barack Obama leaves our nation with a weakened Constitution that has been dealt one crippling blow after another by court rulings and government overreach, with more militarized police empowered to shoot first and ask questions later, with more SWAT team raids, with more government corruption, with more debt than ever before ($19 trillion and rising), with more racial tensions bubbling over into confrontations, with even greater surveillance intruding into the privacy of the citizenry, with less tolerance for free speech and thought, with taxpayers groaning under the weight of even more taxes disguised as fines and fees, with a more “imperial” president empowered to act unilaterally through the use of signing statements and executive orders, with a greater risk of blowback from military occupations, drone strikes and endless wars abroad, and with a citizenry more broken and oppressed than ever.

    In other words, Obama leaves our nation worse off than when he took office.

    You won’t hear any of this from Obama, who believes he would have been re-elected had he been permitted to run for a third term. Nor will you hear it from the celebrities who are quick to sing Obama’s praises, while likening Donald Trump to Hitler. And you certainly won’t hear it from those who are staging sit-ins, marches and acts of civil disobedience to protest Trump’s election, while having failed to voice even a whisper of protest over Obama’s long list of civil liberties abuses.

    Yet the reality we must contend with is that the world is a far more dangerous place today than it was eight years ago, and Obama must shoulder some of the blame for that. As President Harry S. Truman recognized, “The buck stops here.”

    How did we come to this?

    How did a politician who showed such potential and managed to ignite such positive feelings among the citizenry, young and old alike, go from being a poster child for hope and change to being the smiling face of a government that is blind, deaf and dumb to the needs of its citizens?

    Let me answer my own question in a roundabout way by quoting something Meryl Streep said recently in her recent Golden Globe acceptance speech.

    Ostensibly taking aim at Trump for imitating a disabled reporter, Streep declared: “This instinct to humiliate, when it’s modeled by someone in the public platform, by someone powerful, it filters down into everybody’s life, because it kind of gives permission for other people to do the same thing. Disrespect invites disrespect. Violence incites violence. And when the powerful use their position to bully others, we all lose.”

    Streep is right in one sense.

    We all lose when the powerful inflict violence, humiliation, disrespect on others.

    However, where Streep goes wrong is in failing to recognize that “we the people” have been on the losing end of this relationship long before Trump’s name was even being batted about as a possible candidate for the White House.

    Indeed, the agents of the Obama administration—many of whom belong to that permanent government bureaucracy that is unaltered by elections and flows in a continuous line from one president to another—have been consistently and persistently inflicting violence, humiliation and disrespect on the citizenry for the past eight years.

    Every time a SWAT team funded by government grants crashes through a door, that’s an infliction of violence. Every drone strike that kills innocent civilians is inflicting violence on the less powerful. Every roadside stop that ends with an unwarranted strip search is inflicting humiliation on the less powerful. Every law that criminalizes the speech or activities of those whose views may not jibe with the mainstream is tantamount to government-sanctioned bullying.

    So for those lamenting the perils of a Trump presidency, who have been quick to blame racism, sexism and even the Russians for Trump’s electoral victory, you might want to consider the old Native American proverb that says “every time you point a finger in scorn—there are three remaining fingers pointing right back at you.”

    As civil rights activist Cornel West concluded, “The reign of Obama did not produce the nightmare of Donald Trump – but it did contribute to it. And those Obama cheerleaders who refused to make him accountable bear some responsibility.”

    West goes on to document the many missteps that contributed to Obama’s failed legacy: his allegiance to Wall Street, the drone strikes that have killed innocent civilians, the demonization of whistleblowers, the killing of U.S. citizens without due process, and his refusal to hold police accountable for excessive force and civil rights violations among others.

    As West writes for The Guardian:

    “[T]he mainstream media and academia failed to highlight these painful truths linked to Obama. Instead, most well-paid pundits on TV and radio celebrated the Obama brand. And most black spokespeople shamelessly defended Obama’s silences and crimes in the name of racial symbolism and their own careerism. How hypocritical to see them now speak truth to white power when most went mute in the face of black power. Their moral authority is weak and their newfound militancy is shallow.”

    Let me also say that this is not only an indictment of all that Obama has failed to do in the past eight years. It is also an indictment of those administrations prior to Obama, Democrat and Republican alike, which have contributed to our present sorry state of affairs. And it is a warning to Trump as he begins to carve out a path for his own administration.

    Every time I write one of these diatribes about the government, I’m always asked “what can I do to push back against the government?”

    My answer, which I flesh out in greater detail in my book Battlefield America: The War on the American People, is always the same: When all is said and done, politicians are only as effective, trustworthy and accountable as they are made to be. And they are only made to be effective, trustworthy and accountable when the citizenry stays engaged, informed and active in the workings of government.

    One of the best models I know for a citizen who took the duties of citizenship to heart every moment of the day was my good friend, mentor and hero Nat Hentoff—one of the nation’s most respected, controversial and uncompromising writers and a lifelong champion of the First Amendment—who passed away on Saturday, January 7, 2017, at the age of 91.

    Nat was a radical in the best sense of the word, a feisty, fiercely loyal, inveterate freedom fighter and warrior journalist with a deep-seated intolerance of injustice and a love of America that weathered the best and worst this nation has had to offer.

    Nat didn’t live to see the last days of Obama’s reign, but he saw enough to describe the nation’s 44th president as “possibly the most dangerous and destructive president we have ever had.” A few years back, I asked Nat how he maintains his optimism in the face of the constant barrage of discouraging news about government corruption, civil liberties abuses, war, etc.

    I’ll end with Nat’s answer as he inscribed it in the foreword to my book A Government of Wolves: The Emerging American Police State:

    Government officials like to claim that everything they are doing is for security, to keep America safe in the so-called war against terrorism. What they are really effectuating is a weakening of why we are Americans. A lot of Americans today have a very limited idea as to why they are Americans, let alone why we have a First Amendment or a Bill of Rights. People are becoming accustomed or conditioned to what's going on now with the raping of the Fourth Amendment, for example. Too many Americans appear unconcerned about the loss of fundamental individual liberties—such as due process, the right to confront their government accusers in a courtroom, and the presumption of innocence—that are vital to being an American.  Yet the reason we are vulnerable to being manipulated by the government out of fear is that most of us do not know and understand our liberties and how difficult it was to obtain them and how hard it is to keep them.

     

    I have spent a lot of time studying our Founders and people like Samuel Adams. What Adams and the Sons of Liberty did in Boston was spread the word about the abuses of the British. They had Committees of Correspondence that got the word out to the colonies. We need Committees of Correspondence now. The danger we now face is admittedly greater than any we have had before. If I were to judge what I do and write on the basis of optimism, I would probably go back to writing novels, but I figure you have to do what you feel you have to do and just keep hoping and trying to get people to understand why we are Americans and what we are fighting to preserve.

  • Venezuela Hikes Minimum Wage By 50% "Due To Economic War And Mafia Attacks"

    With (hyper)inflation expected to hit 1,660% this year and 2,880% next, Venezuela's President Maduro hiked the minimum wage another 50% on Sunday, the fifth increase in the past year (for a total annualized increase of 536%), to help shield workers from 'economic war'.

    As Reuters reports, the measure puts the minimum monthly salary at 40,683 bolivars – about $60 at the weakest exchange level under the state's currency controls, or $12 at the black market rate.

    "To start the year, I have decided to raise salaries and pensions," he said on his weekly TV and radio program.

     

    "In times of economic war and mafia attacks … we must protect employment and workers' income," added Maduro, who has now increased the minimum wage by a cumulative 322 percent since February 2016.

     

    The 54-year-old successor to Hugo Chavez attributes Venezuela's three-year recession, soaring prices and product shortages to a plunge in global oil prices since mid-2014 and an "economic war" by political foes and hostile businessmen.

     

    But critics say his incompetence, and 17 years of failed socialist policies, are behind Venezuela's economic mess.

     

    They say the constant minimum wage hikes symbolize Maduro's policy failures and fail to keep pace with real on-the-street price rises.

    Fox News also notes that Venezuela's biggest employer, Fedecamaras, said that the pay increase was announced "without consultation" by the government and could reduce employment and result in the closure of companies that cannot deal with the hike.

    And while the black market Bolivar rallied briefly as the bank-note ban debacle was put in place, the currency's street worth is collapsing once again…

    But, as The Washington Post reports, while the government has been able to censor the country’s main newspapers, so you won’t read much about crime in the media, death is one of the few guaranteed things you can find in Venezuela.

    There are no official tallies of deaths related to violence, but some NGOs put last year’s national death toll as high as 24,000, which would make a total of 252,000 deaths since the revolution came to power 17 years ago.

     

    There are an estimated 200,000 members of the Venezuelan security forces, but it doesn’t seem like that is enough.

     

     

    Violence permeates everyday life here. In the streets, gangs clash with one another, with the police and with the army. Sometimes, police even clash among themselves. All of these factions wield power and abuse it. Caught in the middle of all of this, ordinary citizens buy guns to protect themselves. Whether it’s the loss of a friend or a relative, everyone here has been touched by violence. Death is in the air.

     

     

    Venezuela is a country that seems to be at war with itself. It’s not always clear who is who. It’s hard to know who to trust or who your enemy is, so you’re always looking over your shoulder, waiting for the next blow, unsure of where it will come from. Violence has so saturated life here that people have begun to see it as normal.

     

     

    Read more here…

  • CNN Is Now Least Trusted News Network Among Viewers

    Via TheAntiMedia.org,

    A recent poll of cable news network viewers found that CNN’s regular audience is far more skeptical of the political news they receive than Fox News fans.

    In the poll published Wednesday by Rasmussen Reports, 1,000 likely voters were asked to describe their media viewing habits. Seventy-five percent said they watch at least some form of cable news each week, with 42 percent saying they most frequently watch Fox News, 35 percent usually choosing CNN, and 19 percent favoring MSNBC.

    An even 50 percent of frequent Fox News viewers agreed with a followup question, “Do you trust the political news you are getting?” By comparison, 43 percent of frequent MSNBC viewers and just 33 percent of those who mostly watch CNN said they trust their political news.

    According to a November survey by Rasmussen, 37 percent of voters still say they get most of their news from cable news networks. Voters in general were highly critical of the election coverage, with the strongest criticism coming from the 7 percent of those polled who said they mostly get their news from social media, rather than TV.

    While once considered a pioneer of 24-hour TV journalism, CNN has faced criticism and accusations of bias over its political news coverage. During the 2016 election cycle, some viewers and analysts claimed CNN focused too much attention on the candidacy of Donald Trump, even to the point that it negatively impacted other candidates. Trump’s former campaign manager, Corey Lewandowski, worked at CNN for months as an on-air personality while maintaining notably close ties to the candidate.

    In April, Bernie Sanders supporters protested outside of CNN’s offices in Hollywood, claiming the network’s reporters ignored their candidate. In October, CNN cut ties with frequent contributor-turned-interim Democratic National Committee Chair Donna Brazile after WikiLeaks’ archive of Hillary Clinton’s emails revealed Brazile gave Clinton advance notice of debate questions.

    Since the election, CNN has been quick to embrace President-elect Trump. On Dec. 2, CNN reporter Cristina Alesci praised Trump’s advisory board of wealthy CEOs, calling it a “historic” gathering. She continued:

    “I don’t think that I’ve ever seen anything quite like this before. … Like I said before, this list really represents a bipartisan group of people, so he’ll have some very diverse viewpoints to tap into.”

    The president-elect has surrounded himself with a cadre of wealthy advisors and Cabinet members, prompting many critics to question just how much diversity they’ll actually bring to the table. “The very definition of corporate media diversity: the entire spectrum of opinion, from GE to GM,” quipped Steve Rendall, a reporter for the media analysis organization Fairness and Accuracy in Reporting, on Dec. 2.

    In September, FAIR also accused CNN of spreading a false claim about Black Lives Matter protests being stoked by “outside agitators” in Charlotte, North Carolina, which quickly went viral among conservatives.

    From their close ties to politicians to the apparent agendas pushed by paid pundits, viewers are wise to question the political news they receive from any major TV news network.

  • Redneck Investin Part 5 – Muny over Yonder

    Many investors who aren’t ECP simply can’t access decent strategies for investing and practically, if you only have $100,000 to invest, it’s really not worth it in today’s world (better to ‘invest’ in your own living conditions, vehicle, tools, and other things you might actually need).  You don’t need to be a redneck to follow these simple rules, but if you want to run a ‘redneck check’ on yourself, here’s a list of signs you might be a redneck IF:

    1) Your neighbor dug a big hole in his backyard he calls a ‘mud hole’ which is used on weekends.  He fills it with water and lets it sit for days, creating a ‘mud soup’ and then invites his friends over with their trucks as they drive through it one by one, until one turns over or the engine dies.

    2) Your other neighbor burns their garbage, plastic bags and all.  

    3) You need a monster truck to access your property.

    4) You don’t have a bank account because you ‘don’t trust them suns a bitches.’

    5) You’ve invested more than 50% of your yearly disposable income in your truck.

    Not all southerners are rednecks – here’s a good comparison about the differences between ‘southern’ and ‘redneck’:

    • Southern: Eating honeysuckle
    • Redneck: Chewing tobacco
    • Southern: Playing barefoot outside with your friends as a kid
    • Redneck: Going to the grocery store barefoot
    • Southern: Having a truck
    • Redneck: Having any of the following on your truck: a lift kit, a Confederate flag, or any sticker that talks about guns, has the word “pussy”, or actually labels you as a “redneck”.
    • Southern: Food with a lot of butter
    • Redneck: Food with a lot of mayonnaise
    • Southern: Common family nicknames include “Junior” and “Sissy”
    • Redneck: Common family nicknames include “Bubba” and “Buzz”
    • Southern: Cracker Barrel
    • Redneck: Golden Corral
    • Southern: Elvis, Johnny Cash, The Allman Brothers, Lynard Skynard
    • Redneck: David Allan Coe, Toby Keith, Trace Adkins
    • Southern: Having pecan pie crumbs on your mouth
    • Redneck: Missing teeth from your mouth
    • Southern: Having at least one relative (even if distant and you’ve met them once) who owns horses
    • Redneck: Having at least one relative who’s had sex with a horse
    • Southern: Having an innocent crush on one of your cousins as a kid
    • Redneck: Doing literally anything about that crush
    • Southern: Tailgating before a game
    • Redneck: Tailgating without having tickets to the game and watching it on a TV in the parking lot
    • Southern: Sweet tea
    • Redneck: Mountain Dew
    • Southern: Drinking moonshine borderline ironically on special occasions like weddings or weekend trips to the mountains
    • Redneck: Consuming moonshine regularly like it’s not even a thing 

    So here’s part 5 in our series Redneck Investin’ – for the ‘other’ America:

    Ways to get money, food, a place to live, and other highlights of life in USA

    Free Cash – Sites like Free Money Claims www.freemoneyclaims.com , www.pleaseorderit.com/free – and many others, offer the ability to get free money.  Who doesn’t like free money?  Yes, it can be a big waste of time.  But you’ve got plenty of time – you’re unemployed, on the dole, and Wrastlin’ doesn’t come on for another 3 hours!

    Food Stamp Arbitrage – THIS IS ILLEGAL – DO NOT TRY THIS AT HOME.  Many rednecks trade food stamp products for cash at a huge discount, sometimes even 50%.  But they have no choice, as who else is going to pay them for 100 cases of Coca Cola but their local Quik-e-mart.  

    Panhandling – THIS IS ILLEGAL – DO NOT TRY THIS AT HOME.  You know the best parking lots, the best clothes to wear – to evoke that human nature in people.  Make that man shell out all the cash in his wallet, because he feels bad for you.  Keeping the family in the car is a big plus!  Take his plastic too.  DISCLAIMER – Sadly, these untrained panhandlers would fare better on Wall St. where they would be paid millions to do the same job but in a different context.

    Friends are for MUNY – Rednecks have no shame to just flat out ask you for money.  If you refuse for a reason such as ‘I don’t use cash’ they offer a host of solutions such as ‘oh you can write me a check, thanks.’  There’s not a friend they won’t abuse with this question but it’s also a bit of a ‘redneck test’ because if you are a true redneck, you’d ask the friend first.

    Craigslist FREE – Really, the average person would be shocked what people give away on Craigslist.  Here in the south, it’s common to find things like Televisions, Wood crates, furniture, couches, cats, bicycles, and other stuff completely free.  People just want to get rid of their junk.

    Metal Scrapin’ – Dismantling America’s dwindling infrastructure one railroad tie at a time.  This can be an environmentally friendly and profitable hobby if done LEGALLY.  If you ASK people they will often have metal you can take with their permission for FREE – such as old appliances, old excercise equiptment, shopping carts, wheelchairs, all kinds of stuff.  Stealing metal is illegal and potentially dangerous, every year in the South there are at least a small handful of deaths or near deaths of copper wire theives getting electrocuted, and in LA too.  Even though the price of scrap metal is near an all time low – they still pay.  Haul it over to the yard!

    For more on this series, see:

    Redneck Investin Part 4 – Free on the Fringe

    Redneck Investin Part 3 – Get R Dun

    Redneck Investin Part 2 – The evolved Redneck – READ before RIOT 

    Redneck Investin Part 1 – A look from the other side

    If you order stuff online, checkout PleaseOrderIt.com which provides special discounts, savings, coupons, and free stuff too!  For a guide to the markets and how to survive with only a small amount to invest, checkout Splitting Pennies only $6.11 on Amazon.

  • State Department Says Presenting Evidence Of Russian Hacking Would Be "Irresponsible"

    One recurring lament throughout the theatrically dramatic campaign involving reports and emotional appeals by US intelligence agencies such as the CIA (whose primary function is the creation of disinformation) to ordinary Americans, that Russia had “hacked the US presidential election” is that for all the bluster and “conviction”, there has been zero evidence.

    And, as it turns out, there won’t be any, because according to the US State Department, US intelligence agencies were right to not reveal evidence of their proof that Russia interfered in US elections, and comparisons with intelligence reports that Iraq had WMDs were not relevant in the current year.

    Asked by RT’s Gayane Chichakyan if Friday’s public intelligence report should have contained any proof of Russian intervention, State Department spokesman John Kirby said that no one should be surprised that US intelligence agencies were keeping evidence secret in order to protect sources and methods.

    “Most American people understand that they have the responsibility to protect their sources and methods,” Kirby said, adding it would be “irresponsible” to do otherwise. Actually, with the Iraq WMD fiasco strill fresh in “American people’s” minds, it is irresponsible to think most Americans are still naive idiots who will believe whatever the “intelligence agencies” will tell them.

    Alas, none of that has filtered through to the appropriate authorities, and Kirby said that it was “up to the agencies to decide which information they share with the public. We rely on them to make that determination for themselves.” And, in this case, it meant sharing no information at all.

    The assessment in Friday’s report was made “by all 17 intelligence communities. All of them came to the same basic conclusion: that Russia interfered in the US election,” Kirby said. “All of our intelligence communities came to the same basic conclusion, over and over again.”

    They just couldn’t prove it, instead hoping that by repeating the same statement over and over would be sufficient.

    Furthermore, the actual report, describes itself as an “analytic assessment drafted and coordinated among The Central Intelligence Agency (CIA), The Federal Bureau of Investigation (FBI), and The National Security Agency (NSA).”

    Russian President Vladimir Putin and his government “aspired to help President-elect Trump’s election chances when possible by discrediting Secretary Clinton and publicly contrasting her unfavorably to him,” the agencies assert in the report, noting that the CIA and FBI have “high confidence” in this judgment, while the NSA – which, in theory, would have actual surveillance data to prove the assertion – had only “moderate” confidence.

    Secretary of State John Kerry “believes strongly that they handled this matter in the appropriate way, in terms of how it was analyzed, how it was presented, and how it was briefed to those who needed to see a deeper level of information,” Kirby said.

    When Chichakyan brought up the 2003 intelligence assessment on the Iraqi weapons of mass destruction – invoked by the Bush administration to justify the US invasion and occupation of that country – Kirby said the comparison was irrelevant, since that was a long time ago.

    “We have moved on. We have learned a lot from those mistakes,” he said.

    Ironically, somehow much of America ended up with the opposite conclusion.

  • Trump Backs Delay Of Obamacare Repeal After Pressure From Rand Paul

    As we reported earlier today, while many items on the Trump agenda for both the “first day” and the rest of 2017, could take a substantial amount of time and effort before they are legislated and implemented, one thing that there was virtually unanimous consensus on, was that Trump would immediately launch the repeal of Obamacare, even if replacing the Affordable Care Law would take considerably longer (as it would require bipartisan support). 

    However, it now appears that even the prompt repeal of Obamacare is in question as Trump has now backed waiting to repeal the Affordable Care Act until a replacement proposal is in hand, following in a Friday night phone call with Rand Paul, the Kentucky Republican said Monday, adding to momentum for changing GOP leaders’ strategy on dismantling the 2010 health-care law.

    Paul has emerged a vocal leader of a growing group of Republican senators expressing concerns with GOP plans to vote to repeal the health law early this year, then to hammer out over weeks or months what would replace it after a two- to three-year transition. Cited by the WSJ,  Paul said in an interview “I believe we should vote on replacement the same day we vote on repeal,” and added that Trump called the senator on Friday night “to say he agrees completely.”

    As the WSJ adds, a Trump transition official confirmed that the incoming president spoke with Mr. Paul on Friday, and said meetings are under way to determine how a replacement law could be approved at the same time—or close to it—that a repeal of the law is approved. Last week, Trump personally warned congressional Republicans on Twitter to “be careful” about the political consequences of moving quickly to repeal the law.

    The push from both Trump and Paul, as well as at least five other GOP senators, will put pressure on Republican leaders to accelerate the process of crafting a unified GOP replacement plan. Republicans have proposed dozens of ideas over the years for overhauling the health-care system but have yet to coalesce around a plan.

    In other words, in a shift on a popular Nency Pelosi statement, the Republicans “will not repeal it eventually come up with a replacement“, but will do both at the same time. The question now is how long such a unified process could take.

    Senate Majority Leader Mitch McConnell, who met with Mr. Trump in Trump Tower on Monday morning, appeared to indicate Sunday that Republicans were accelerating the process of settling on a replacement plan.

     

    “We will be replacing it rapidly after repealing it,” the Kentucky Republican said Sunday on CBS. He wasn’t specific about the timing of the drafting of a new health-care system, or what it would entail, but he said, “There ought not to be a great gap between the first step and the second.”

    Trump has said before that he wanted to “simultaneously” repeal and replace the health-care law, but GOP leaders on Capitol Hill hadn’t committed to that timeline.

    One thing is clear: both repealing and replacing the health law would be complicated legislative maneuvers with sweeping repercussions for both the health-care industry and millions of American consumers. It could also take years, and keep Obamacare in its current form for a long time, contrary to Trump’s campaign promises.

    Reince Priebus said on Sunday that a new health plan might not be ready immediately after gutting the Affordable Care Act. “It may take time to get all the elements of the replacement in place,” Mr. Priebus said on CBS. “The full replacement may take more time than an instantaneous action.”

    As reported previously, Republicans are planning to use a special process tied to the budget to pass legislation repealing the health law with a simple majority, but they can afford to lose few GOP votes. They would need all Republicans and several Democratic votes to then approve any replacement health-care system, in order to reach the 60 votes needed to clear the chamber’s procedural hurdles. Paul, who has objected to the budget maneuver over its spending levels, said that he would like to see what would replace the health law weeks later, after House and Senate committees have detailed how the ACA would be repealed. The budget specifies that they must produce their legislation by Jan. 27.

    Meanwhile, in a separate article, Bloomberg reports that top advisers to President-elect Donald Trump will meet Monday evening with House Speaker Paul Ryan and his policy staff to discuss taxes and other policy issues, according to two people familiar with the plans. Topics on the agenda include tax reform, the budget, infrastructure and Obamacare.

    As a reminder, tax reform was the other item that Trump is expected to be able to enact relatively painlessly.

    Ryan and his team intend to walk through the tax reform plan House Republicans put forward last year, calling it a “priority issue” for the House and the president-elect, according to the other person, a Republican aide. House Ways & Means Committee Chair Kevin Brady will be the House Republicans’ point person on tax reform, the aide said. According to Bloomberg, though Trump and Ryan agree on plenty, points of contention include tariffs for companies that move jobs overseas, a $1 trillion infrastructure plan, as Trump has called for, and how many people an Obamacare replacement should insure.

    Present at the meeting will be all the top economic Incoming White House aides Reince Priebus, Stephen Miller, Stephen Bannon, Jared Kushner and, of course, former Goldman President Gary Cohn.

  • FBI Quietly Releases 300 Documents Pertaining To Hillary Clinton Investigation

    Submitted by Joseph Jankowski via PlanetFreeWill.com,

    While most Americans were likely watching the 74th Annual Golden Globes Awards and NFL football, the FBI quietly released another several hundred pages of documents from its investigation of Hillary Clinton’s private email server on Sunday night.

     

    The documents deal with the handling of computer hardware collected from Clinton’s lawyers for the investigation and also contains emails from FBI officials discussing the classification of Clinton’s emails.

    This is the fifth dump of Clinton investigation records which can be found at the FBI’s Vault website where the agency provides information about high-profile Freedom of Information Act (FOIA) releases.

    Chuck Ross of the Daily Caller reports:

    The emails included in the documents are from the months prior to the formal opening of the Clinton email probe, which occurred on July 10, 2015. The exchanges show disagreements between the FBI and State Department over whether some of Clinton’s personal emails should be classified.

     

    In one April 27, 2015 email, an FBI official wrote to other officials that they were “about to get drug into an issue on classification” of Clinton’s emails. The official, whose name is redacted, said that the State Department was “forum shopping,” or seeking a favorable opinion on the classification issue by asking different officials to rate emails as unclassified.

     

    screen-shot-2017-01-08-at-6-52-31-pm

     

    From FBI document release

     

    Other email traffic sheds light on a controversy involving State Department under secretary for management Patrick Kennedy and a request he made in 2015 that the FBI reduce its classification of a Clinton email related to the Sept. 11, 2012 attacks in Benghazi.

     

    Clinton investigation notes released by the FBI in October showed that an FBI official said during an interview as part of the email probe that Kennedy asked him and others at the FBI to relax classifications on some emails.

    The under the radar release also contains a May 21, 2015 email in which the FBI’s assistant director of the counterterrorism division, Michael Steinbach, details a conversation with Patrick Kennedy on classification.

    In the email, Steinbach recommended that one of Clinton’s emails be classified using b(1) and b(7) redactions, a technique used to protect information in the interest of national defense. Kennedy was asking Steinbach to allow just b(1) redactions.

     

    An unnamed official said that the email in dispute by Kennedy and Steinbach could disclose sources and investigative methods used by the bureau, according to the released documents.

     

    The official also added that the disputed email was redacted and classified on the rationale that it contained information that would cause “interference with foreign relations.”

     

    “While the email does not name the particular official, this might be deduced and, given the threat of violence in the region, any surmise could be fatal for whoever cooperated with us,” the official wrote.

     

    “State will say no one will know if it is redacted, but that is not how classification works,” they added.

    More information will be coming out about this document dump as the week progresses, but don’t expect the MSM to harp on it at all. Remember the Russians are coming…

    The FBI has not yet announced the release of the documents.

    Read the latest Clinton files below:

  • PReCiouS BoDiLY FLuiDS…

    PRECIOUS BODILY FLUIDS

  • Obama Finally Admits He Bears "Some Responsibility" For The Dems' Staggering Losses Since 2008

    On the verge of his last days in the White House and in a rare display of humility, President Obama admitted to ABC’s George Stephanopoulos over the weekend that it is possible, just maybe, that he, and the epic failure of his crowning piece of legislation, Obamacare, could have contributed to the stunning collapse of the Democratic party over the last 8 years.  Well, at least he kind of admitted it before enumerating all the reasons he couldn’t possibly be to blame…but it’s a step in the right direction. 

    “I take some responsibility on that. I think that some of it was circumstances. If you look at what happened, I came in in the middle of the worst financial crisis since the Great Depression. And unlike FDR who waited — well, didn’t take office until about three years into the Great Depression, it was happening just as I was elected. I think we did a really good job in saving this economy and putting us back on the track of growth. But what that meant is in 2010 there were a lot of folks who were still out of work. There were a lot of folks who had lost their homes or saw their home values plummet, their 401k’s plummet. And we were just at the beginnings of a recovery. And the, you know, whoever is president at that point is going to get hit, and his party’s going to get hit. That then means that suddenly you’ve got a redistricting in which a lot of state legislatures are now Republican. They draw lines that give a huge structural advantage in subsequent elections. But what I think that what is also true is that partly because my docket was really full here, so I couldn’t be both chief organizer of the Democratic Party and function as commander in chief and president of the United States. We did not begin what I think needs to happen over the long haul, and that is rebuild the Democratic Party at the ground level.”

    And while Obama would like for you to believe that the prolonged “great recession” caused all of those Democrats losses in Congress and state legislatures, he seems to be “mis-remembering” history.  The “great recession” is precisely what catapulted Obama into the White House and resulted in massive Democratic majorities in both the House and Senate in 2008.  The Democratic losses in the House and State Legislatures across the country didn’t come until the mid-term elections, two full years later in 2010, as Democrats were forced to go out and campaign just after passing the unpopular and wildly controversial Obamacare.

    The Washington Post even created this handy graphic which charts the losses by year.

    Dem Losses

     

    Moreover, if Democrat losses in 2010 were, in fact, attributable to the “great recession”, and given that Mr. Obama constantly likes to remind us that he has presided over a staggering “economic recovery” over the past 8 years, perhaps he can explain why Democrats have continued to lose seats throughout his presidency.  Surely Democrat misfortunes should have reversed in 2012 when it became glaringly obvious that his economic policies were “working,” right?

    And here is the full interview with George Stephanopoulos:

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Jan 09

Today’s News 9th January 2017

  • Tonight's Forecast Inside the Golden Globes: Lots of Snow with a Chance of Trump Tears

    The entire star-studded audience at the Golden Globes practically cried in unison, after Meryl Streep took to the mic to lament over an incident that happened last year regarding what she thought was Donald Trump mocking a disabled reporter.
     
    The rift was with NY Times reporter Serge Kovaleski, who said Trump was lying about witnessing Muslims celebrating in New Jersey after 9/11 — which later proved out to be true. Without delving into old news, Trump said he wasn’t making fun of Serge’s physical disabilities, but instead mocking a reporter who was flustered.
     

    I have no idea who this reporter, Serge Kovalski [sic], is, what he looks like or his level of intelligence. I don’t know if he is J.J. Watt or Muhammad Ali in his prime or somebody of less athletic or physical ability. Despite having one of the all-time great memories, I certainly do not remember him.
     
    I merely mimicked what I thought would be a flustered reporter trying to get out of a statement he made long ago. If Mr. Kovaleski is handicapped, I would not know because I do not know what he looks like. If I did know, I would definitely not say anything about his appearance.

     
    In light of all the horseshit taking place in the world, the fact that the United States is engaged in armed conflicts in 8 different countries and is led by a man who has literally destroyed the middle east, relations with Russia, and has divided this country along matters of race, gender and orientation more than any person in the history of the country, as well as compiling more debt than all of the previous Presidents combined, Meryl Streep decided that Trump mocking a reporter was the most important thing to talk about during her 5 minute speech at the Golden Globes tonight.
     


     
    Once icy cold, floating through the air with glee, the snow flakes have hit the ground now and have melted.

     

     

    Content originally generated at iBankCoin.com

  • Yuan Is Crashing (Again)

    The volatility in the Chinese currency has gone from the sublime to the ridiculous. After exploding 21 handles stronger in the biggest PBOC-engineered short-squeeze in history – erasing the entire post-election sell-off – offshore Yuan is now collapsing once again, down 350 pips tonight (and over 10 big figures from Thursday's highs). While interbank rates have calmed down, the rush to exit the currency has not…

    The last two days are the biggest drop in offshore Yuan since Aug 2015's devaluation… as PBOC weakens its fix by the most sine June 2016.

     

    Pushing historical volatility to its highest since the Aug 2015 devaluation…

    For some context, this level of volatility is over 10 standard deviations away from the pre-Aug 2015 norms.

    Notably the moves accelerate afterPBOC Advisor Fan Gang told Bloomberg TV…

    • *PBOC WANTS TO SEE FX RESERVES REDUCE SMOOTHLY, GRADUALLY: FAN
    • *CHINA POLICY MAKERS NOT LIKELY GO FURTHER ON OUTFLOW CURBS: FAN
    • *YUAN OVERVALUED IN PAST 3-4 YEARS AGAINST DOLLAR: FAN
    • *CHINA POLICY MAKERS NOT LIKELY TO DROP INTERVENTION: FAN
    • *USE OF YUAN HAS INCREASED DESPITE RECENT DEPRECIATION: FAN
    • *CHINA NEEDS LESS FX RESERVE AFTER YUAN'S INCLUSION IN SDR: FAN

    Which was followed by the state-run Global Times newspaper says in an English-language editorial, saying that the Chinese people will demand its government to “take revenge” if Donald Trump reneges on the one-China policy after becoming U.S. President.

  • US Aristocracy Panics That Maybe Trump Is Serious

    Submitted by Eric Zuesse via Strategic-Culture.org,

    On January 2nd, the U.S. Republican Party’s Wall Street Journal headlined «Tensions Within GOP Rise Over How to Handle Russia», and reported that the policy toward Russia by the incoming Republican President Donald Trump is being opposed not only by Democrats in the U.S. Congress, but also by some Republicans, and perhaps even by enough Republicans to jeopardize confirmation of his nominee for U.S. Secretary of State, as well as some nominees for other crucial diplomatic and military positions.

    A key insightful passage in that news-report was: «‘What you are seeing on Russia within the Republican Party is in some ways more a symptom of realignment across the board within American political parties,’ said Matthew Rojansky, director of the Washington-based Kennan Institute. ‘This speaks to something very critical that’s going on in our political system right now.’»

    Trump is being significantly opposed by both Parties regarding his foreign policies, even though his domestic policies are being opposed on a far more partisan basis, by Democrats, and have a higher chance of congressional passage than his international initiatives do, because of the almost-solid support for his domestic policies on the part of Republican members of Congress — and because Republicans control both the Senate and the House.

    The «realignment across the board within American political parties» is actually a realignment only in the field of foreign policy — not at all in domestic policy. What used to be «Republican foreign policy» ever since the time of Richard Nixon, has been called «neoconservatism» — referring to a hard line against communism and then against Russia and any country that’s friendly toward Russia — but the incoming Republican President Trump campaigned consistently against neoconservatism, and now Democrats are almost solidly neocons, while some Republicans are actually joining the Republican President in condemning neocons.

    Whereas Trump is generally called «conservative» on his domestic policy statements, he could possibly turn out to be more of a «progressive» than his Democratic Party predecessor, President Barack Obama, was, regarding foreign affairs. And this terrifies the U.S. aristocracy in both of the political Parties, because the U.S. aristocracy — both its Republicans and its Democrats — has been solidly neoconservative: they are virtually united, on this, against Trump.

    The U.S. aristocracy control not only the major American corporations, but all influential ‘news’ media, and their respective ‘news’media; and their shared fear and loathing for incoming U.S. President Donald Trump is clear, even though he himself is one of them. Nobody knows what will happen to the U.S. government under his stewardship, but the fear amongst almost all of the other aristocrats is that maybe Trump hasn’t only been pretending to want a ‘populist’ government — they fear that he might really have such revolutionary intentions. They are consequently afraid: might it really be the case that a revolution — especially one transforming America’s foreign policies, which are the policies that are of the greatest interest to aristocrats (more even than domestic policies are) — will be led by a member of their own class? Is the ruling class — the thousand or so of them in the U.S. — perhaps now splitting, in a way that is far more meaningful than the merely superficial (rhetorical) distinctions that still remain between America’s two major political Parties, the Republicans and the Democrats?

    The old ideological political alliances within the United States have now utterly broken down, and the reason is that in recent decades, both the right and the left had been controlled behind the scenes, by America’s billionaires and centi-millionaires, who are virtually unanimous on some policy-issues (so that the U.S. has a one-party government on these matters), with no significant ideological dissent amongst the U.S. aristocracy on those key issues, especially about continuing the old ideological Cold War against communism, switched now into a purely nationalistic and increasingly hot war against Russia, as allegedly an evil and imperialistic nation in ways that the United States itself is supposedly not (but actually is even more so than Russia or any other nation in the world, and widely recognized as such, except inside the United States itself, where the aristocracy’s ‘news’ media hide this ugly nationalistic fact about the land they control — the fact of America’s being the world’s most aggressive nation).

    America’s super-rich have no objection against the government that they control conquering others, like the Iraq-invasion in 2003, and the U.S. coup overthrowing and replacing the democratically elected and Moscow-friendly President of that country in 2014, and aiding jihadists in Syria to overthrow Syria’s pro-Russian secular government; and the phone-tapping of all Western leaders including Angela Merkel and generally practicing cyber-invasions everywhere in the world — but they and their agents allege that Russia is doing these things even worse than America is, and needs to be punished by the ‘virtuous’ U.S. government for (allegedly) doing what the U.S. actually does far more than any other nation in the world.

    Though Trump has reversed himself on many things that threaten the U.S. aristocracy, such as by his saying he won’t, after all, prosecute Hillary Clinton for her crimes (which were never really investigated under Obama’s regime — and protecting the legal immunity of aristocrats is crucial to the aristocracy of both political Parties), Trump still hasn’t – now just days before entering the White House – reversed himself regarding his intention to improve relations with Russia. 

    Becoming even more hostile toward Russia is almost a unanimous goal of the U.S. aristocracy. They’re thus rebelling against him, in their ‘news’ media, and they won’t stop trying to cripple his Presidency unless and until he relents on this, turns around, and continues, ever-hotter than before, their (under Obama, increasing) ’Cold War’ against Russia: going beyond even what President Obama has been doing (coups, invasions, sanctions, etc.), aiming to replace the Russian government’s allies by the American government’s allies, and thus to isolate and weaken Russia, ultimately to take over Russia itself.

    During the early years of the Cold War, America’s Republican Party and their ‘news’ media, especially insisted upon increasing the war against the Soviet Union; but, now, in the purely nationalistic war against Russia, it’s instead Democratic Party politicians and ‘news’ media, who are especially fervid to conquer Russia. Republican Party ‘news’ media, such as Fox ‘News’, are now considerably less hateful toward Russia, no longer obsessed against it, like the Democratic Party’s ‘news’ media have become — thereby switching political roles.

    Consequently, too, for example, the Democratic Party’s Washington Post is doing everything they can to encourage U.S. conquest of Russia, such as by spreading fake ‘news’ stories against the few small independent Western newsmedia that are pointing out the lies (especially the ones against Russia) in such media-giants; and some of the Republican Party’s ‘news’media now are even doing in-depth actual news-reporting about the fraudulence of the Democratic Party’s ‘news’media, on these matters that are of such intense interest to America’s aristocrats.

    Excellent examples of this phenomenon are provided by the various ‘news’media of the rightwing-populist Alex Jones, which featured, on New Year’s Day, the video «Dems Want War With Russia To Stop Trump», and an associated investigative news report from their Mikael Thalen, «Washington Post Stirs Fear After False Report of Power Grid Hack by Russia», exposing the WP’s lying propaganda for «War With Russia» — Democrats’ (and a few Republicans’) lies basically to promote unsubstantiated allegations by the Obama regime, that ‘Russian hacking’ is a danger both to American ‘democracy’, and to American national security.

    That «War With Russia» video (at 5:00-) presents the futurist, Gerald Celente, discussing liberal Democrats who were saying, totally without evidence, such things as »Vermonters and all Americans should be both alarmed and outraged that one of the world’s leading thugs, Vladimir Putin, has been attempting to hack our electric grid, which we rely upon to support our quality of life, economy, health, and safety.» The infamous 1950s Republican, Joseph R. McCarthy, has thus non-ideologically returned from the grave, now, in the guise of liberal Democrats (or should that instead be ‘Democrats’?), as part of the U.S. aristocracy’s war to force the Republican President, Donald Trump, to join the tradition that the Republican President George Herbert Walker Bush established, on 24 February 1990, of treating Russia as being America’s enemy, no longer communism as being America’s enemy.

    These people simply can’t draw enough of other people’s blood. Bram Stoker might be shocked that reality has thus produced ghouls who would make Stoker’s own legendary vampires seem like angels by comparison. Will Trump perform the role of Stoker’s hero, Abraham van Helsing here, or instead become just another of the vampires himself (which all of America’s major, and most of its minor, ‘news’media are demanding)?

  • "Unequivocally Bad?" Gas Prices Soar Over 20% YoY – Most Since 2011

    In December 2014, as gas prices had plunged over 20% YoY, Janet Yellen proclaimed "from the standpoint of the U.S… the decline we've seen in oil prices is likely to be, on net, a positive," and that narrative of slumping gas prices being "unequivocally good" for Americans was spewed everywhere across linear-thinking mainstream media. So we wonder, with gas prices up 22% year-over, the fastest spike since 2011, is that "unequivocally bad" for America?

    Remember when Janet Yellen, and all the tenured economists in her circles said that plunging gas prices are great for the consumer?

    The dramatic plunge in oil prices might be spooking some investors, but Janet Yellen isn't worried at all.

     

    The Federal Reserve chief believes oil tumbling is like a tax cut for American consumers.

     

    "From the standpoint of the U.S. and U.S. outlook, the decline we've seen in oil prices is likely to be, on net, a positive," said Yellen at a press conference on Wednesday.

     

    "It's good for families, for households. It's putting more money in their pockets," she said.

     

    "On balance, I would see these developments as a positive," she said.

    Well, as we noted last week, as GasBuddy warned of "sticker-shock" – as motorists will shell out $52 billion more over the course of the year compared to 2016, we are about to find out just how bad for the consumer rising prices will be.

    Retail gas prices surged again last week, with the average price for regular gasoline at U.S. pumps rising 11.97c to $2.3777/gal, according to Lundberg Survey.

    This is a 20.6% year-over-year surge – the biggest since October 2011.

     

    By Janet Yellen's logic, the 20-plus percent surge in gas prices means "less money in Americans' pockets" and as a final reminder, this is what happened to the US Macro-economic data, the last time gas prices surged at the current pace…

    Trilby Lundberg, president of Lundberg Survey, explains there are two primary causes to rise in average retail price:

    1. "Retail gasoline has been catching up to earlier crude price rises”, and
    2. "More states added gasoline tax hikes and federal regulations reduced amount of sulfur in gasoline by two- thirds, both effective Jan. 1"

    We wonder what Janet Yellen will have to say about this 'drag' on the consumer… or is it now an indication of the 'confidence' in the US economy?

  • Ron Paul Sums Up Nobel-Peace-Prize-Winning President Obama In One Short Sentence

    Following our discussion of the unprecedented bombing-fest that has been undertaken during President Obama's reign…

    Seven years after being awarded the Nobel Peace Prize for his "extraordinary efforts to strengthen international diplomacy and cooperation between peoples," despite having been in office for less than one year and having pretty much no actual, tangible foreign diplomacy accomplishments at the time, President Obama will depart the White House having dropped 26,171 bombs on foreign countries around the world in 2016, 3,027 more than 2015.

    According to an analysis of Defense Department data from the Council on Foreign Relations, a non-partisan think tank, the majority of Obama's 2016 bombs were dropped on Syria and Iraq.  Meanwhile, Afghanistan, a country President Obama vowed U.S. troops would evacuate completely by the end of his Presidency, was also bombed over 1,300 times, a 40% increase over 2015.  Per McClatchy DC:

    The U.S. dropped 79 percent of the anti-Islamic State group coalition bombs in Syria and Iraq, totaling 24,287. That figure, along with others analyzed by CFR, is likely lower than the actual number dropped because one airstrike can involved multiple bombs.

     

    Obama did authorize a troop surge in Afghanistan — a conflict he pledged to end during his campaign — where the U.S. dropped 1,337 bombs in 2016. There are currently 8,400 U.S. troops left in the country, more than Obama initially wanted to keep there at the end of his term. The U.S. only dropped 947 bombs in Afghanistan in 2015.

     

    The U.S. also dropped more bombs in Libya in 2016 than it did in 2015. Nearly 500 bombs were dropped in the North African country that has essentially been ungoverned since the fall of dictator Muammar Gaddafi in 2011. He was captured and killed during the Libyan Civil War, kicked off by the Arab Spring protests that also began the Syrian conflict.

    Bombs Dropped

    Ron Paul opined on the farce via his Facebook page…

    Barack Obama started with a Nobel Peace Prize and is ending his presidency with the Pentagon's Distinguished Public Service Medal.

     

     

    Sounds about right for a president who bombed 7 nations and became the first in U.S. history to be at war every single day of his eight year administration.

    Just remember America, as Obama signs 'The Ministry of Truth' act into reality, "War is peace, freedom is slavery, and ignorance is strength."

  • On Russian Hacking, The Only Narrative That Matters Is Truth

    Authored by Davide Battistella,

    Excuse me for wanting to point out the obvious, but sometimes the obvious gets very lost in the web of narratives spun by the master narrator inside the White House. Forgive me, but are we not losing the idea that the only narrative that really matters is that all of the information “LEAKED” was obtained through a simple fishing e-mail sent to John Podesta. See their own words here:

    Somehow this has been converted into words like “HACKING” (ps it is not hacking when it involves your own ineptitude or stupidity) into “Russian actors”, “digital fingerprints” or any other slew of gobbledyspeak they can come up with for wanting desperately to hide a simple fact: the truth is in the e-mails.

    Notice nobody is disputing the contents of the email leaks, they just want to complain about the fact that it was stolen by Russians,  though if the passwords were freely given away it’s hard to call it hacking.

    Just to be clear a hack is defined this way.

    “Computer hacking refers to the practice of modifying or altering computer software and hardware to accomplish a goal that is considered to be outside of the creator’s original objective. Those individuals who engage in computer hacking activities are typically referred to as ‘hackers‘.”

    That is completely different from entering an account to which a party freely gave away the password and downloading the data for say an “inbox”.  So don’t confuse hacking with the granting of access through being ill informed.

    The reason all of this becomes important is simple, it’s leading the world into potentially very dangerous conflict.  This isn’t something that should be taken lightly and you have to go to the WHY?  Why is it so important to divert people from the contents of the e-mails and point them instead to the way they were obtained.  It’s for war mongering purposes.

    The MSM is going right along with it too.  Have we heard nearly as much about the theft and publication of Donald Trumps tax returns as published by the New York Times?

    http://www.nytimes.com/2016/10/02/us/politics/donald-trump-taxes.html

    Who is investigating the “hostile actors” from within the IRS who might have illegally stolen, copied and provided documents to the New York Times who then did barley more that what Wikileaks did with the Podesta e-mails.

    At least Wikileaks published a pristine, searchable archive, the kind you could search in your local public library. In a crowdsourcing age, it is incredible what can be uncovered in a shot amount of time.

    But it is different now.  Wikileaks expects  “professional” journalists to do their jobs, pour through the information and uncover everything from the salacious, the banal and the illegal.  Why did this not happen with the wikileaks, but it was all hands on deck to pour over illegally obtained tax returns of a private citizen. Perhaps MSM credibility is at the heart of the issue? Not sure. 

    People consume information differently now and have many outlets to weigh before forming an opinion and that is a narrative busting option.

    There remains only one defense, attack the messenger, lie and divert attention. So you can’t dismiss the contents of the wikileaks, you can only call Assange a pedophile, place him under house arrest, tell the world that Russia did the following (and I am following your logic here “intelligence” community/narrative spinners)

    1. The Russians sent a phishing e-mail to John Podesta and he responded with his password.
    2. The Russians downloaded all the information in his inbox.
    3. The Russians found a third party who new Jullian Assange and arranged for that third party to deliver the contents of that archive to wikileaks.
    4. Wikileaks released the information day after day and about 120 million and Americans followed that story closely enough that based on that leak (and maybe the DNC one as well) decided that they could not vote democrat in the election.
    5. Hillary Clinton won the popular vote but lost the electoral college by losing  key “shoe in” democratic stronghold manufacturing states where jobs have been lost, people are hurting and decided voted for change, not because of those reasons but because somehow Russia managed to release true information to the American public.

    While all this was happening President Obama knew about it and told Putin to “cut it out” or you he would be in trouble after the election, after we try some recounts and after we try to intimate the electoral college, but before I leave office. Maybe I will throw in a fake story from the Washington post that Russia tried to hack the power grid on Christmas day in Vermont as well, just to get folks really fired up.

    This entire transition process demonstrates a complete lack of class and childish behaviour by the outgoing administration. That is the only way to describe it.  Sore losers who demostrate abolutely no class, no respect for process or really for the American people who democratically elected Donal Trump in a fair process.

    Folks don’t get bamboozled, remember, your President told you this when the narrative suited him.

    Transcript from TIME

    President Obama,

    “One of the great things about America’s democracy is we have a vigorous, sometimes bitter political contest and when it’s done, historically, regardless of party, the person who loses the election congratulates the winner, who reaffirms our democracy and we move forward.

     

    That’s how democracy survives because we recognize that there’s something more important than any individual campaign. And that is making sure that the integrity and trust in our institutions sustains itself.

     

    Because democracy, by definition, works by consent, not by force. I have never seen, in my lifetime or in modern political history, any presidential candidate trying to discredit the elections and the election process before votes have even taken place.

     

    It’s unprecedented. It happens to be based on no facts; every expert, regardless of political party, regardless of ideology, conservative or liberal, who has ever examined these issues in a serious way, will tell you that instances of significant voter fraud are not to be found, that — keep in mind, elections are run by state and local officials, which means that there are places like Florida, for example, where you’ve got a Republican governor, whose Republican appointees are going to running and monitoring a whole bunch of these election sites.”

    That was on October 19th of 2016.

  • Twitter Suspends Martin Shkreli for Trolling a Reporter

    I haven’t seen any of Martin’s tweets ever since he blocked me for calling out his utter bullshit with Kalobios. Apparently, he’s been very busy stalking some liberal reporter on Twitter, goading and trolling her to the point that @Jack had to step in and put an end to the madness.

    Have a closer look at his homage to Lauren Duca.

    shkreli

    Is Twitter a little fucking obsessed with controlling their community? Absolutely. Back in the old days I felt very comfortable telling people to ‘DIE IN A FUCKING RAGING FIRE’ or to ‘GET EATEN BY A HOMOSEXUAL GIRAFFE.’ But now, I rarely tell people to fuck off, for fears of being banned.

    It’s sad, really.

    Here is a DM Marty sent Lauren, which has given me some new found respect for the ‘pharma bro.’

    martin

    Washpo tried to reach out for comment on the situation and was roundly rebuffed, basically told to fuck off.
    kovnt6dsayzkcaj8v-ykdqdu5oco8zukyj5-tik-ghm

     

    And this from Huffington Post, reporting on the situation.

    The Huffington Post attempted to reach Shkreli via an email address he had previously listed on his Twitter page; we received a response that read “lol suck a dick.”

     

    Content originally generated at iBankCoin.com

  • Democrats Use Trump-Rescued Ethics Office To Delay Trump Nominees

    In an ironic twist, following president-elect Trump's urging to kill a bill that would have severely diminished Congress' Ethics Office power, The Hill reports that Democrats are calling on Senate Republicans to delay hearings for Trump's Cabinet picks, citing an incomplete ethics screening of several nominees.

    As a reminder, House Republicans abruptly voted on Monday night to eliminate the independence of the Office of Congressional Ethics, the chamber’s nonpartisan ethics board which investigates lawmakers' alleged misconduct, largely stripping it of its power, leading to pushback from Democrats and government watchdog groups. House Republicans, meeting as a group Monday night, approved an amendment from House Judiciary Committee Chairman Bob Goodlatte that would place the office under the oversight of the lawmaker-run House Ethics Committee.

    Trump responded…

    Which led House Republicans to hold an emergency meeting, resulting in… (via The Hill)

    House Republicans at an emergency conference meeting on Tuesday withdrew a proposal to gut an ethics watchdog.

     

    House Majority Leader Kevin McCarthy (R-Calif.) offered a motion to restore the current OCE rules, and that was accepted by the GOP conference.

     

    The new Congress hadn't even formally gaveled in on before GOP leaders held an emergency conference meeting to discuss the blowback against the party's vote Monday evening to gut the chamber's independent ethics watchdog.

    And so now, as The Hill reports, Democrats are using that rescued 'power' to try to delay confirmation of Trump's cabinet picks…

    Early on Saturday, the director of the federal Office of Government Ethics, a watchdog agency that conducts ethics reviews of all Cabinet appointments, said that the plan to hold confirmation hearings before the ethics reviews are complete is "of great concern."

     

    “As OGE’s director, the announced hearing schedule for several nominees who have not completed the ethics review process is of great concern to me,” Walter Shaub, Jr., said in a letter to Senate Minority Leader Charles Schumer (D-N.Y.) and Sen. Elizabeth Warren (D-Mass.).

     

    “It is unprecedented and deeply worrisome to hold confirmation hearings on President-elect Donald Trump's nominees before basic ethics reviews are completed," Democratic National Committee (DNC) spokeswoman Adrienne Watson said in a statement.

     

    "These rushed hearings must be delayed until the ethics reviews are finished, and if Trump and the GOP-led Senate fail to do so, the only reasonable conclusion to be drawn is that they are concerned about what will be exposed,” Watson added.

     

    Schumer blasted the timing of the scheduled hearings, accusing Republican lawmakers of trying to "jam through" the nominees.

    The GOP hoped to hold confirmation hearings on Tuesday and Wednesday as the party seeks to usher a smooth transition of power to the new administration. The nominees currently scheduled for the next week's hearings include former ExxonMobil CEO Rex Tillerson, Trump's pick for secretary of State; Sen. Jeff Sessions (R-Ala.), Trump's pick for attorney general; and Betsy DeVos, Trump's pick for Education secretary.

    And as one would imagine Trump's team strongly disagrees with "head clown" Schumer's view of the hearings… (via The Hill)

    Incoming White House chief of staff Reince Priebus said Sunday there's “no reason” to delay confirmation hearings for President-elect Donald Trump’s Cabinet nominees until their background checks are complete.

     

    “No, they have to get moving. They have to move faster,” Priebus told "Fox News Sunday." “They have all the information. These are people that have been highly successful in their lives. They need to move quicker.

     

    “The fact is there’s no reason,” he added. “It’s the first week of January, they have all the details that they need, they have all the information that they need, it’s no different from any other new administration coming in. The American people demand it. Change was voted for and change we will get.”

     

  • Neera Tanden Reveals "Hillary Will Never Run For Elected Office Again"

    "I felt a great disturbance in the farce, as if millions of snowflakes suddenly cried out in terror and were suddenly silenced. I fear something terrible has happened…"

    Just days after rumors emerged of Hillary Clinton potentially running for New York City mayor, Hillary Clinton confidante Neera Tanden told CNN that she doesn't expect Clinton to run for New York City mayor — or anything else, ever again.

    "I think she's going to figure out ways to help kids and families. That's been what she's been focused on her whole life, and a lot of issues that are affecting them, over the next couple of years," Tanden told CNN's Jake Tapper on "State of the Union" Sunday.

     

    "But I don't expect her to ever run for any elected office again," she said.

     

    Tanden, a close Clinton ally and the head of the liberal think tank Center for American Progress, was shooting down reports of chatter in New York political circles that Clinton could run against incumbent Democratic Mayor Bill de Blasio.

     

     

    "I don't expect her to run for this and I don't expect her to run for other office," Tanden said. "I think her job is to — what she's thinking about right now is how to help those kids and families as she has her whole life."

    It appears our video anology of Clinton's strategy meeting was spot on…

Digest powered by RSS Digest

Jan 08

Today’s News 8th January 2017

  • Newt Gingrich Likens Russian Hacking Probe to Benghazi, Says 'Profoundly Wrong Things Going On'

    Newt Gingrich dropped some redpills during a Fox News interview, wondering out loud ‘what’s going on here?”

    Amongst his chief complaints is the fact that NBC obtained the report from the Obama administration before President elect Trump. What was Obama doing to protect against hacks and for how long did he know about them? Why did Obama slap Russia with sanctions a week before the report? What basis did he use to justify them?

    Trump wants to know how the fuck NBC obtained the report before him and has called for an investigation.

     

    Content originally generated at iBankCoin.com

  • THe EMPeRoR OF HORSe $HiT

    EMPEROR OF HORSE SHIT

  • Czech Government Fears Muslim "Super-Holocaust", Urges Citizens To Shoot Them Yourselves

    On the heels of Czech President Milos Zeman's warnings of a possible "super-Holocaust" carried out by Muslim terrorists, urging citizens to arm themselves, WaPo reports the country's interior ministry is pushing a constitutional change that would let citizens use guns against terrorists if police are delayed or unable to make their way to the scene of an attack.

    Czech president Milos Zeman had previously proposed that economic migrants should be deported from Europe to “uninhabited Greek islands” or to “empty places” in North Africa. The spectacularly incredible president also proposed that the Greek debt should be progressively reduced in return for shouldering the cost of hosting hundreds of thousands economic migrants.

    “We are in Greece, and Greece has plenty of uninhabited islands, and big foreign debt. So if you have ‘hotspots’ in Greek islands, this would be a sort of payment of foreign debt,” Zeman told Financial Times in an interview on the islands of Rhodes where he participated in the Rhodes Forum.

    As The Guardian previously noted, the Czech president has unleashed a rhetorical fusillade against Muslim incomers of such intensity that it makes the anti-Islamic sentiments of Robert Fico, the Slovakian prime minister, and even Viktor Orbán, Hungary’s prime minister, seem mild in comparison.

    Zeman has warned that the Czech Republic – home to fewer than 4,000 Muslims out of a population of 10.5 million, according to official figures – could be targeted in a jihadi attack and urged Czechs to arm themselves against what he referred to as a possible "super-Holocaust." The concern is believed to have prompted the unprecedented introduction of metal detectors to screen the crowds of foreign tourists that visit Prague castle each day.

     

    The alarmist message is particularly striking because unlike most anti-immigrant politicians in western Europe, Zeman, 71, is a social democrat (and former communist) rather than a rightwinger, and the Czech Republic has been largely spared the waves of refugees that have swept into neighbouring Austria and Hungary en route to Germany.

    But now, as The Washington Post reports, the rhetoric is getting even louder as the country's interior ministry is pushing a constitutional change that would let citizens use guns against terrorists.

    Proponents say this could save lives if an attack occurs and police are delayed or unable to make their way to the scene. To become law, Parliament must approve the proposal; they'll vote in the coming months.

     

    The Czech Republic already has some of the most lenient gun policies in Europe. It's home to about 800,000 registered firearms and 300,000 people with gun licenses. Obtaining a weapon is relatively easy: Residents must be 21, pass a gun knowledge check and have no criminal record. By law, Czechs can use their weapons to protect their property or when in danger, although they need to prove they faced a real threat.

     

    This puts the country at odds with much of Europe, which has long supported much more stringent gun-control measures.  In the wake of the 2015 terror attacks in Paris, France pushed the European Union to enact even tougher policies. The European Commission's initial proposal called for a complete ban on the sale of weapons like Kalashnikovs or AR-15s that are intended primarily for military use. Ammunition magazines would be limited to 20 rounds or less.

     

    The Czech Republic came out hard against the directive. Officials warned — somewhat ominously — that the measure would limit the country's ability to build "an internal security system" and make it nearly impossible to train army reservists. And a total ban on military-style rifles that can fire large numbers of rounds would make illegal thousands of weapons already owned by Czech citizens, potentially creating a black market for terrorists to exploit.

    Of course, the populist rhetoric may be the driving force behind this bill, as for now the Czech republic is the only country to oppose the EU's directive for being too strict.

    This is not the first 'extreme' move by Czech politicians with regard refugees/muslims/terrorists, as we noted previously, police in the Czech Republic are investigating comments made on Facebook by an extremist politician calling for refugees to be placed in Terezin, the former Nazi concentration camp.

    Adam Bartos, the leader of the fringe yet vocal far-right nationalist National Democracy Party, published the comments about the site, located in the central European country, on Monday.

     

     

    Reacting to the establishment of a refugee camp near the country’s border with Slovakia, Bartos wrote, “Why build tent camps for the aliens? We have the beautiful fortress town of Terezin where the aliens could concentrate before they are taken home by trains.”

     

    A police spokeswoman told the Czech News Agency on Monday that the police will probe whether or not the comments constitute a criminal act. According to Czech law, hate speech and comments inciting national, racial or religious hatred can carry penalties of up to three years in prison.

     

    Bartos is under investigation for four incidents involving allegedly racist, anti-Semitic and violence-inciting remarks. He also keeps a blog titled Hall of Jewish Fame that critics say lists politicians, journalists and other public figures of supposedly Jewish origin.

     

    Bartos’ party failed to gain seats in the European elections last year, the only campaign it has run in under his leadership.

    Terezin, also known as Theresienstadt in German, is located some 40 miles northwest of Prague.

    The town was turned into a concentration and transit camp by the Nazis in 1941. Roughly 144,000 Jewish people were sent there during the Holocaust, most of whom were later transported to extermination camps in occupied Poland. Some 33,000 died in the Terezin camp.

  • Confessions Of A Fake News Reporter

    Submitted by Douglas Herman via Strike-The-Root.com,

    “A lie can travel half way around the world while truth is still putting on its shoes.”  ~ Mark Twain

    I write for those so-called “fake news” websites. You know the ones: the 200 odd deplorable websites, the ones Hillary, the Pope and Michael Moore have attacked as threatening to destroy World Peace, Democracy, Facebook and the Mainstream Media (MSM).

    I only write for a handful of them, sad to say, although I’ve been linked to scores more. One of my recent columns went viral and it probably swayed the entire election – for better or worse: Before Trump, Sen Bulworth Spoke Truth To Power .  Seriously, the blatant corruption of the losing team, from Super Delegates to Podesta and PizzaGate to hidden Hillary health issues and secret sums of money funneling through the Clinton Foundation in “Pay to Play” accusations cost them the election, despite the best efforts and endorsements of the entire American media.

    I’ve written for Rense, Counterpunch, Antiwar and Zerohedge. Most of my best stuff appears here on Strike The Root first, or STR as we call it, a website where Henry David Thoreau rather than Mark Zuckerberg is our moderator.  Tragically, STR did not appear on ProporNot and we are devastated, absolutely devastated.  Not.

    Sometimes I ask my friends: If knowledge is power and ignorance is bliss, which is preferable? I always hope someone will respond, as Socrates or Obi Wan would have: Knowledge of our ignorance is power; bliss in this age is unattainable. 

    So then, as an average American citizen, is it better to be misinformed or uninformed? Because Disinformation is almost a holy sacrament within the mainstream Operation Mockingbird media. Thus we fake news reporters believe we’re channeling our inner Tom Paine, Mark Twain or Henry D. Thoreau when we blog or post or link. When HDT wrote: “There are a thousand hacking at the branches of evil, to one who is striking at the root,” he was a spreader of fake news, by today’s tender standards. We like to think of ourselves as worldwide root strikers, following in his footsteps.

    Cui Bono: Who Benefits?

    Cops and crime scene investigators (CSI) always ask that question: Who benefits? Who had most to gain by the murder? We fake news reporters pride ourselves on getting the facts. Like legendary Joe Friday from that old TV show, Dragnet, we interview eyewitnesses, contact insiders and whistleblowers, sift through the circumstantial evidence (Like John Podesta’s creepy artwork) and attempt to deduce the truth. Unlike the TV talking heads and Op/Ed writers for the elite media news, we want to know exactly Who Benefits?  Even if it pisses off some elites. Or the elite media.

    “There are invisible rulers who control the destinies of millions. It is not generally realized to what extent the words and actions of our most influential public men are dictated by shrewd persons operating behind the scenes.”

    Sounds like some fake news screed, right, or some wacky conspiracy theory, right? Nope, this was written almost a hundred years ago by the Father of Public Relations and author of a book on propaganda that greatly influenced Adolf Hitler. Edward Bernays was Jewish and teaching in New York in 1923. Hitler’s Propaganda Minister, Joseph Goebbels, read his book Crystallizing Public Opinion and learned a lot from him a few years later, adopting Bernays’ masterful propaganda techniques.

    “There is no means of human communication which may not also be a means of deliberate propaganda,” Bernays wrote and the Nazis adopted. “The American motion picture is the greatest unconscious carrier of propaganda in the world today.”

    Maybe the mainstream media should nominate Ed Bernays as the Founding Father of Fake News, for spreading these ludicrous ideas far ahead of his time. But fakery and fudging the facts is best left to those rich and powerful Mockingbirds and their presstitutes of the so-called legacy media. Most of the best and brightest of that media have long since been blacklisted or silenced. Seymour Hersh, Steve Lendman and Paul Craig Roberts rarely appear in the NY/LA Times anymore.  Why? Because their stuff, like most of the stuff written by unknown root strikers like me, is exactly like Senator Bulworth’s. Too tough, too true.

    “It must be the money; it turns everything to crap,” said Bulworth to some Hollywood elites in that movie, just before the Oscar-winning actor and director, Warren Beatty, was blacklisted from Hollywood for almost 20 years. But money is rarely a factor for fake news reporters like myself. We do it for patriotism and professional pride. In more than a dozen years of devising “fake news,” I’ve been paid about $2,000 or about TEN BUCKS A COLUMN.

    “I guess I really do believe that the good is worth doing because it is good,” said peace activist and co-founder of Veteran Intelligence Professionals for Sanity (VIPS), Ray McGovern. “It shouldn’t matter that there is little or no guarantee of success, or even a truthful recounting of what happened.”

    A couple years ago, McGovern was manhandled out of a Hillary Clinton speech she gave at George Washington University.  The topic of her speech? The need for respect of dissent. Naturally NONE of the so-called legacy media present there covered his dissent, except in a dismissive way. “America’s Fawning Corporate Media is the embodiment of a Fourth Estate that is dead in the water,” McGovern added.

    By contrast to my TEN BUCKS a column, Hillary Clinton received a reported $500,000 for an appearance and speech she gave at ASU. The transcript never appeared in public, as far as I know, so it must have been absolutely priceless.

    “Hillary Clinton, the woman who voted for a war that was sold on a diet of fake news, a war that killed hundreds of thousands, is now lecturing Americans about fake news putting ‘lives at risk’,” wrote Paul Joseph Watson, on the alleged fake news website Infowars. Watson is like Sherlock Holmes’ sidekick on steroids. “Being lectured by Hillary Clinton about fake news is like being lectured by Ted Bundy about not raping and killing women. It’s a joke, but a particularly sick joke given that Hillary’s role in pushing fake news had actually led to the deaths of countless innocent lives.”

    We fake news reporters feed on the efforts and insights of others. We wish them well, Godspeed, Kudos, Bravos, Hurrahs, Links and Likes. Because we know that Pulitzer Prizes for reporting are now reserved for the con artists connected to the crony crime media. True Crime reporters rarely win Pulitzers anymore.

    Consider Matthew Allen. He penned a column called: NYT Mocks PizzaGate as Impossible, But Its CEO Covered up Jimmy Savile Scandal. Now if this news reporter Allen is wrong, a malicious spreader of so-called fake news, then why doesn’t the NYT sue him for slander or libel?  Most of us would simply Google this fellow Jimmy Savile and then we would try to weigh the facts in PizzaGate objectively.

    Allen writes, “It’s important to remember that the CEO of the fabled newspaper is none other than Mark Thompson, the former BBC director who ‘lied’ during the Jimmy Savile investigation, and is at least partly to blame for allowing a monster like Savile (So evil?) to operate within the BBC for so long ‘undetected’.”

    As I said, if so many of us fake news reporters are slandering people, why aren’t they suing us? Shouldn’t The New York Times, instead of trying to sublet office space in their diminishing empire, sue writers like Matthew Allen? Why doesn’t the New York Times sue him for malicious slander or libel? “Mark Thompson’s newspaper is a crime against the written word,” Allen added, as a parting shot.  

    To those of us who seek the truth, guys like Allen and Assange and Anonymous are allies in the fight against the toxic lies of the wealthy, well-connected and woefully corrupt power elites.

    Props or Snopes?

    Over the holidays, when a huge scandal shocked the cringing mainstream media world, WE CELEBRATED. We celebrated the deliciously karmic news that Facebook 'fact checker' Snopes.com was accused of embezzling company funds. The so-called debunker of “fake news,” deified by the mainstream media without any fact-checking at all, suddenly was a steaming pile of backstabbers, porn stars and alleged con artists and embezzlers.  Not that there’s anything wrong with porn stars.  Most mainstream media personalities are highly paid porn performers. They just earn MILLIONS more than porn star Jenna Jameson ever dreamed of earning.

    Many brilliant fake news reporters remain anonymous while posting as fictional characters in the alt media. Cognitive Dissonance, Miffed Microbiologist and Hedgeless Horseman are funny and always provocative at Zerohedge.  Jack Burton, at the same website, offers some astute, thought-provoking insight on an especially timely subject, terrorism.

    “ISIS never touches an Israeli head,” Jack opined recently. “They are sworn allies of the Israeli Government. Seeing great benefits to be had from the Middle East Super Power, backed by the USA. The main ISIS allies are: Turkey, Israel, the USA and NATO. All this Obama crying on TV about ISIS threats is bullshit fucking lies. Obama is behind backing ISIS on to final victory in Syria. When Russia began to kill ISIS in earnest, the following governments demanded they cease bombing ISIS at once:  Saudi Arabia, Qatar, Jordan, Turkey, USA, UK, Germany and others.”

    Now that Aleppo has fallen, the mainstream media is in mourning. Not for all the wars they encouraged these past 15 years, or for the millions of refugees those wars caused, or the tremendous pressure now on European countries to house and feed those refugees.  No, not at all.  To them, that evil dictator Putin has almost prevailed, and only freedom of the press will keep democracy safe. And you know what? They are right. Only freedom of the press and the Constitution will keep citizens safe. That’s why I guess I’ll log onto George Washington’s Blog, Zerohedge, Infowars, Brietbart, STR, Rense and Natural News to stay informed.  Because we fake news reporters must keep informed.  Without us, America will certainly fall.

    Addendum: While we fake news reporters love to be proven right, quite often we’re proven prescient. When I penned JFK and Obama–Profiles in Courage and Cowardice, I hoped to have been proven wrong. Sadly, ALL of the fake news reporters I quoted in that column EXACTLY eight years ago were proven correct.

    Addendum 2.0   No fake news reporter can claim Trump will succeed overwhelmingly. More likely he will sell out his huge core of hopeful believers to the money/power elites, just as almost all presidents have done in the past. If not, Trump will die in some tragic accident or from some lone gunman. We would love to be proven wrong.

  • Citi: "There Is Something Strange Going On… Something Doesn't Smell Right"

    With the Dow Jones rising excruciatingly close, or within 0.37 points of 20,000 on Friday only to let down the market cheerleaders in the last minute, it would appear that there is nothing one can throw at a market which is determined to keep rising no matter what happens in the world.  So leave it to our favorite skeptic, Citi’s Matt King to throw a fly in the ointment by asking how is it possible that “nothing sticks to markets.”

    He proposes one possible reason: perhaps analysts were overly pessimistic going into the election and year end, which is possible considering the “most synchronized DM upturn in years”…

    … an upturn, which however, has been largely predicated by the reflexivity of soaring stock markets, which in turn have spiked not on actual news, but frontrunning the “everyone’s-a-winner-under-Trump” trade…

    … which however may never actually materialize in practice, and which could very well also lead to a recession as the surging dollar leads to a global GDP slump while paralyzing financial conditions (see recent record FX volatility in China).

    As King then notes, earnings bullishness gets you only so far, and as the chart below shows, the recent surge in global stock prices is not a function of earnings, but expanding P/E multiples relative to Trasuries, which then prompts him to ask why, now that yields are surging, “shouldn’t we be discounting using higher bond yields.”

    This is turn prompts King to propose one of his trademark rhetorical questions: “There Is something strange going on” adding that “something doesn’t smell right” in a world in which uncertainty is soaring yet spreads are collapsing, as SocGen first pointed out last month in its “most frightening credit chart“, even as leverage also keeps rising.

    What is the “key ingredient” in the mix that makes sense out of this market chaos? Simple: according to King, central bank buying of anything that is not nailed down is the “missing link.”

    Furthermore, despite all talk of a shift from monetary to fiscal stimulus, “central banks aren’t done yet“, not by a long shot:

    Which in turn has – so far – allowed markets to ignore the reality that the credit bubble is getting bigger by the day as debt and interest coverage continue to rise while EBITDA still shrinks, resulting in late cycle fundamentals and valuations.

    And yet, there is always a tipping point: according to King, such a point would arrive once real yields spike higher “not matched by a pick-up in growth.”

    His final rhetorical question: how long until this tipping point happens? The answer: 50 basis points.

    Now if only a 50 basis point spike in real yields would also put an end to all the other “strange things” taking place in a world which is burning every day, yet where the Dow Jones is partying like it’s 19,999.

  • Hypernormalisation

    Submitted by Bryce McBride via Mises Canada,

    This past November, the filmmaker Adam Curtis released the documentary Hypernormalisation.

    The term comes from Alexei Yurchak’s 2006 book Everything was Forever, Until it was No More: The Last Soviet Generation. The book argues that over the last 20 years of the Soviet Union, everyone knew the system wasn’t working, but as no one could imagine any alternative, politicians and citizens were resigned to pretending that it was. Eventually this pretending was accepted as normal and the fake reality thus created was accepted as real, an effect which Yurchak termed “hypernormalisation.”

    Looking at events over the past few years, one wonders if our own society is experiencing the same phenomenon. A contrast with what economic policy-makers term “normalisation” is instructive.

    Normalisation is what has historically happened in the wake of financial crises. During the booms that precede busts, low interest rates encourage people to make investments with borrowed money. However, even after all of the prudent investment opportunities have been taken, people continue borrowing to invest in projects and ideas that are unlikely to ever generate profits.

    Eventually, the precariousness of some of these later investments becomes apparent. Those that arrive at this realization early sell up, settle their debts and pocket profits, but their selling often triggers a rush for the exits that bankrupts companies and individuals and, in many cases, the banks which lent to them.

    In the normalisation which follows (usually held during ‘special’ bank holidays) auditors and accountants go through financial records and decide which companies and individuals are insolvent (and should therefore go bankrupt) and which are merely illiquid (and therefore eligible for additional loans, pledged against good collateral). In a similar fashion, central bank officials decide which banks are to close and which are to remain open. Lenders made freshly aware of bankruptcy risk raise (or normalise) interest rates and in so doing complete the process of clearing bad debt out of the system. Overall, reality replaces wishful thinking.

    While this process is by no means pleasant for the people involved, from a societal standpoint bankruptcy and higher interest rates are necessary to keep businesses focused on profitable investment, banks focused on prudent lending and overall debt levels manageable.

    By contrast, the responses of policy-makers to 2008’s financial crisis suggest the psychology of hypernormalisation. Quantitative easing (also known as money printing) and interest rate suppression (to zero percent and, in Europe, negative interest rates) are not working and will never result in sustained increases in productivity, income and employment. However, as our leaders are unable to consider alternative policy solutions, they have to pretend that they are working.

    To understand why our leaders are unable to consider alternative policy solutions such as interest rate normalization and banking reform one only needs to understand that while such policies would lay the groundwork for a sustained recovery, they would also expose many of the world’s biggest banks as insolvent. As the financial sector is a powerful constituency (and a generous donor to political campaigns) the banks get the free money they need, even if such policies harm society as a whole.

    As we live in a democratic society, it is necessary for our leaders to convince us that there are no other solutions and that the monetary policy fixes of the past 8 years have been effective and have done no harm.

    Statistical chicanery has helped understate unemployment and inflation while global cooperation has served to obscure the currency depreciation and loss of confidence in paper money (as opposed to ‘hard money’ such as gold and silver) that are to be expected from rampant money printing.

    Looking at unemployment figures first, while the unemployment rate is currently very low, the number of Americans of working age not in the labour force is currently at an all-time high of over 95 million people. Discouraged workers who stop looking for work are no longer classified as unemployed but instead become economically inactive, but clearly many of these people really should be counted as unemployed. Similarly, while government statistical agencies record inflation rates of between one and two percent, measures that use methodologies used in the past (such as John Williams’ Shadowstats measures) show consumer prices rising at annual rates of 6 to 8 percent. In addition, many people have noticed what has been termed ‘shrinkflation’, where prices remain the same even as package sizes shrink. A common example is bacon, which used to be sold by the pound but which is now commonly sold in 12 ounce slabs.

    Meanwhile central banks have coordinated their money printing to ensure that no major currency (the dollar, the yen, the euro or the Chinese renminbi) depreciates noticeably against the others for a sustained period of time. Further, since gold hit a peak of over $1900 per ounce in 2011, central banks have worked hard to keep the gold price suppressed through the futures market. On more than a few occasions, contracts for many months worth of global gold production have been sold in a matter of a few minutes, with predictable consequences for the gold price. At all costs, people’s confidence in and acceptance of the paper (or, more commonly, electronic) money issued by central banks must be maintained.

    Despite these efforts people nonetheless sense that something is wrong. The Brexit vote and the election of Donald Trump to the White House represent to a large degree a rejection of the fake reality propagated by the policymaking elite. Increasingly, people recognize that a financial system dependent upon zero percent interest rates is not sustainable and are responding by taking their money out of the banks in favour of holding cash or other forms of wealth. In the face of such understanding and resistance, governments are showing themselves willing to use coercion to enforce acceptance of their fake reality.

    The recent fuss over ‘fake news’ seems intended to remove alternative news and information sources from a population that, alarmingly for those in charge, is both ever-more aware that the system is not working and less and less willing to pretend that it is. Just this month U.S. President Barack Obama signed the Countering Disinformation and Propaganda Act into law. United States, meet your Ministry of Truth.

    Meanwhile, in India last month, people were told that the highest denomination bills in common circulation would be ‘demonetized’ or made worthless as of December 30th. People were allowed to deposit or exchange a certain quantity of the demonetized bills in banks but many people who had accumulated their savings in rupee notes (often the poor who did not have bank accounts) have been ruined. Ostensibly, this demonetization policy was aimed at curbing corruption and terrorism, but it is fairly obvious that its real objective was to force people into the banking system and electronic money. Unsurprisingly, the demonetization drive was accompanied by limits on the quantity of gold people are allowed to hold.

    Despite such attempts to influence our thinking and our behaviour, we don’t need to resign ourselves to pretending that our system is working when it so clearly isn’t. Looking at the eventual fate of the Soviet Union, it should be clear that the sooner we abandon the drift towards hypernormalisation and start on the path to normalisation the better off we will be.

  • Democratic Party 'Post-Election' Strategies

    Denial is not just a river in Egypt…

     

    Source: ComicallyIncorrect.com

  • Is A Bitcoin "As Good As Gold"?

    Submitted by Stefan Wieler via GoldMoney.com,

    Introduction

     

    The price of Bitcoin seems to have exceeded the price of gold briefly for the first time this week; however, this comparison is completely arbitrary.

     

    Gold is measured in weight, while Bitcoin, much like currency, is an abstract form of money and can only be measured in units of itself. One Bitcoin is worth a lot more than 1 gram of gold, but a lot less than 1 tonne. Despite Bitcoin’s stellar performance in 2016, the size and depth of the cryptocurrency market is dwarfed by the $7 trillion gold market.

     

    Gold remains the only true global money with a size and volatility comparable to that of fiat currency.

     

    View the entire Research Piece as a PDF here…

    Bitcoin – or cryptocurrency itself – is the most exciting monetary experiment in modern times.

    Unlike fiat currency, it can’t just be printed, and it mimics the scarcity properties of gold in that it needs an enormous amount of energy to create one coin. The energy-proof of value is what links gold to the primary industries and allows it to maintain its purchasing power over incredibly long periods of time. Without it, any form of money will inevitably be corrupted over time and decay. Bitcoin has some of the same energy-proof of value that makes gold far superior to fiat currency, which can be created with the stroke of a key. Bitcoin, also like gold, is a global currency that may be universally accepted in the future. Even USD can’t make that claim.

    Bitcoin has some qualities that are not shared by any other form of money, most notably the potential total anonymity in electronic transactions; however, some might feel that aspect that may prevent the universal adoption of Bitcoin as money. Today, the global stock of Bitcoin is just $20 billion (despite its price rally) and its transaction volume is tiny, even when compared to more exotic currencies. That said, as the adoption of Bitcoin increases, governments may no longer be happy with the fact that it can be used for anonymous transactions and may prevent legitimate businesses from accepting it as money if they see this as a threat. Only time will tell. In the meantime, Bitcoin remains the only alternative to gold (and other precious metals) for savers to escape the built-in decay function of fiat currency otherwise known as inflation.

    Bitcoin is currently in the limelight because it has apparently exceeded the price of gold for the first time on some exchanges (although at the time of writing, Bloomberg still shows an average price of Bitcoin hasn’t crossed the gold price yet, but it seems just a question of time). We have no doubt that this will lead to a barrage of headlines in online media, and some mainstream outlets will jump on the bandwagon as well. After all, they already widely reported on a claim made by the Winklevoss brothers in mid-2016 that Bitcoin’s volatility had apparently fallen below the volatility of gold, and thus Bitcoin had become “better at being gold than gold”. We rebutted this claim and surely Bitcoin’s volatility shot back up to 100% shortly thereafter.

    Bitcoin has rallied almost USD500 last year and USD100 in the first two days of 2017 alone. At the time of writing, 1 Bitcoin was trading at USD1,135, while 1 oz of gold was trading at USD1,164. To some, it may seem like Bitcoin is about to be more valuable than gold, and though this is of course conceptually incorrect, it probably won’t stop the media pundits from publishing the headline anyway.

    Gold and elements can be measured by weight (oz, g, kg, t). Mass and weight are the measuring units endowed by nature. Fiat currencies, or any other abstract commodity or money (including Bitcoin), cannot be measured that way. An abstraction can only be measured in units of itself. Gold and silver are therefore the only form of money today that are traded in weight. Fiat currency on the other hand cannot be measured by anything other than other currency, at least since Nixon ended the convertibility to gold in 1971. In that respect, Bitcoin falls into the same category.

    Thus, when comparing units of gold to units of Bitcoin, one must first define what unit it is measured against. Is it grams (currently USD37/g), kilograms (USD37,000/kg) or tonnes (USD 37 million/tonne)? Or are we measuring it in the rather obscure measure of troy ounce (USD1,157/ozt), which, apart from exchange traded metals, is not used for anything else?

    Hence comparing the price of 1 Bitcoin vs 1 troy ounce of gold is a little bit like comparing the shares of Seaboard Corp. (USD4,179 per share) to those of Apple Inc. (USD116 per share) and concluding that Seaboard Corp. is worth 35 times as much. Clearly, measured accurately by market cap, Apple is the largest and most valuable company in the world and worth 126 times as much as Seaboard Corp.

    The same basic principle applies to money. Combined above-ground gold stocks are currently worth around $7 trillion. As we noted last year, that is more than all banknotes in circulation of all currencies combined (see Eliminating cash will also eliminate the checks and balances on banking policy and practice, February 22, 2016), and it certainly dwarfs the market cap of Bitcoin at around $18 billion. In fact, all crypto-currencies combined (we count 710) have a market cap of just $21 billion (see Figure 2).

    bitcoin market size full

    There is another obvious obstacle when comparing Bitcoin with gold: Volatility. High volatility is often pointed out against gold being used as medium of exchange and store of value. We will look the volatility of gold in more detail in an upcoming report, but in a nutshell, we find the volatility of gold (measured as standard deviation) is roughly comparable with currency, and gold has proven to be a much better store of value than any currency over the long run – even when interest is taken into account. Bitcoin’s volatility significantly exceeds that of both gold and currency. At times, Bitcoin’s volatility declines for a short period and can even approach the volatilities of gold and currency, but tends to shoot up violently shortly thereafter.

    Bitcoin major currencies

    However, standard deviation should not be confused with a measure of risk. The standard deviation quantifies the dispersion of returns; what it does not do is distinguish whether that dispersion comes from upward or downward moves.

    For example, an asset that has a 1% return every second day and 0% return every other day would exhibit an annualized standard deviation of 8%. An asset that has a -1% performance every second day and 0% every other day exhibits the same standard deviation. In an asset management context, the two assets may have the same risk. In fact, the negatively performing asset might reduce risk in a portfolio if it is negatively correlated to the other assets. But for a saver, the first asset is clearly less risky.

    Hence, instead of measuring volatility as standard deviation, we can measure just the downside deviation. This provides a better idea of the risks of money. How does this look for Bitcoin? Bitcoin’s downside deviation is still several orders of magnitude higher than that of gold or currency. Over the past two years, Bitcoin experienced a downside deviation of >45%. Since the beginning of data in 2010, it was >100%.

    bitcoin deviation

    The volatility – or to be precise, the downside risk – makes it difficult for Bitcoin to be more widely adopted as money. What speaks for Bitcoin is that it has shown stellar performance over its short lifespan, but this stellar performance comes with considerable downside risk. A merchant accepting Bitcoin as payment is exposed to this downside risk unless he instantly exchanges Bitcoins back to currency following the transaction. Even though a cycle takes about 6 minutes in theory, exchanging Bitcoin to currency actually takes about one hour to confirm the transaction and another hour to confirm the price, during which at the very least the merchant is exposed to the downside volatility. Holding Bitcoins permanently might hold huge upside, but that also comes with intolerable downside risk for a merchant. After all, merchants should spend their time and energy with what they are best at (selling goods) rather than trading currencies and Bitcoin.

    Another claim we don’t agree with is that Bitcoin is as free of counter-party risk as gold. What we have seen with Ethereum, another nascent cryptocurrency, is that these virtual currencies ultimately have a master key. With Ethereum, that key is controlled by a council that decides its future inflation rate; with Bitcoin, that key is controlled by Gavin Andresen, an engineer based in Massachusetts. There’s no guarantee that they won’t change the source code for the Bitcoin blockchain in the future, and when you “own” a Bitcoin you simply refer to the blockchain – a distributed ledger that tells you what and how much you own. In this regard, we don’t agree that Bitcoin does not have custodial or counter-party risk; the blockchain itself is the fat tail.

    This means that for now, gold remains the only global currency in which individuals and corporations can transact with no time delay, with price volatility comparable to that of major currencies yet without counter-party risk, and one that has been proven as a store of value for thousands of years.

  • China’s tighter overseas currency use impacts Canadian real estate landscape

    The heavy exodus of the Chinese renminbi from mainland China put pressure on the country’s economy. In an effort to stymie the outflow, the Peoples Bank of China (PBOC) enacted new rules that are meant to help it exert more control over its currency…and that could spell trouble for the Canadian real estate market!

    A CANADIAN REAL ESTATE “BUBBLE”

    It is well known that the global financial crisis of 2009 was precipitated by a housing “bubble”in the United States. Real estate analysts south of the border, and even some local market watchers here in Canada, have long been predicting a similar bubble of sorts brewing in Canada. However, the Canadian “bubble” seems to have a much different origins.

    The Canadian Perspective

    It has long been suspected that the booming housing “bubble”, in great Canadian metropolitan cities like Toronto and Vancouver, was partly inflated as a result of foreign buyers. Predominant amongst those foreigners were property buyers and investors from China. Desperate to diversify their investments, and find better use of their capital outside the mainland, Chinese buyers are rumoured to be piling into real estate in large cities like Vancouver and Toronto.

    According to industry analysts, home prices in British Columbia increased from 6.6% year-over-year in 2014, to 20.5% in 2016; while Ontario saw increases from 5.2% to 11.6% over that same period. Clearly, by some definitions, this is a bubble in the making.

    The Chinese Perspective

    Every sovereign nation wants to (in fact must!) have maximum control on its currency, and China is no exception. However, once currency is converted into foreign exchange and sent out of jurisdictions influenced by the country, “control” becomes even more difficult to exert.

    The large outflow of currency from China is a concern to the authorities there – and they
    decided late last year to do something about it. Among some of the exchange control measures include:

    • Making it harder for individuals and institutions to convert renminbi into other currencies
    • Enforcing greater restrictions on transferring money from the mainland to other international jurisdictions
    • Requiring more transparency on the intent and motivation behind foreign exchange transactions
    • Mandating greater punishment for individuals and institutions who run afoul of the new rules

    While large Chinese corporations and global real estate players may still be able to skirt around these new regulations, it is expected that a large amount of property investment transactions by individuals could be impacted. As a result, Canada, and especially hot beds like Vancouver and Toronto real estate, should brace for potential fallout.

    MORE THAN A CHINA CONNECTION

    While China’s new forex rules will definitely put a damper on many Canadian real estate companies business plans, there is more bad news for the industry – largely emanating from within Canada. Both at the federal and provincial levels, governments are concerned about facing similar repercussions as that seen by our southern neighbor because of housing bubbles faced there. As a result:

    • In February 2016, the government of British Columbia implemented a new tax rate of 15% for properties sold in excess of $2-million; while also mandating collection of more data on foreign buyers
    • At the same time, the BC government also empowered municipalities like Vancouver to tax “empty homes”– mostly foreigner-owned investment properties that are vacant; waiting to be sold at a huge profit
    • On October 3, 2016, the federal government imposed more stringent rules for mortgage insurance, raising the barrier for high-ratio borrowers to qualify for loans
    • Additionally, through that same legislative move, some loopholes in Canada’s tax code, which were being used for preferential tax treatment by foreign buyers and non-permanent residents, were closed

    All of these moves are billed as initiatives that will ultimately make housing more affordable in hot markets like Vancouver and Toronto. However, their impact will be far-reaching in terms of broader impact to the nation’s real estate market.

    Early Signs

    It is too early yet to tell whether the new regimen will have any impact on Canada’s housing industry. But based on early reports from B.C, it does look like they are having a
    cooling effect, at least in the Vancouver area.

    Since the new Canadian/B.C rules took effect, there has already been a marked decline in foreign investment recorded in Vancouver. According to the B.C government’s information, foreign purchases in Metro Vancouver, which also includes Chinese purchasers, accounted for roughly 3% of the region’s residential real estate transactions from June 10th to October 31st, 2016. This number has dropped well below the 13.2% rate for similar
    transactions prior to the new legislation.

    WHAT THE FUTURE HOLDS

    The end game for China’s new currency export policy is to detract its citizens from annually spending an estimated $15 to $20 billion overseas. But China-analysts seem to think that, even though the country’s new forex laws are tightening the noose around real estate investors who may be contemplating Canadian investments; such transactions will likely not decline substantially – at least not in the immediate future. New ways to get renminbi out of China will evolve within months of old ones being shut down!

    Canadian real estate industry analysts however seem to have a different take on the issue. According to Canadian property market watchers, the number of resale homes projected for resale in 2017 across Canada are expected to fall by around 11.5% (compared to 2016); with B.C leading the pack (-23.8%), and Ontario (-10.5) declining by double-digits.

    This one-two punch, by federal and provincial jurisdictions, to the real estate market doesn’t bode well for the real estate industry, but especially for property owners. Researchers believe that the collective impact of the new housing regimens – both from China and from within Canada – will contribute to much slower increases to property values.

    Researchers forecast that on a national level, the average Canadian home’s resale value will increase by only 1.6% in the New Year, compared to a robust 9.5% increase in 2016. Ontario homes are set to post their weakest rate of increase in over 8 years – at 3%;
    while B.C home prices will rise by 1.9% (compared to a staggering 20.5% in 2016).

    With not much information available as of yet, about the impact of the policies discussed here, it is hard to predict what impact they are having on the country’s real estate industry. One thing is definite though: None of the steps implemented so far, by both China and various jurisdictions within Canada, seem “investor friendly”.

    1. http://www.rbc.com/economics/economic-reports/pdf/canadian-housing/housingforecastNovember2016.pdf

    2. http://www.news1130.com/2016/09/14/details-on-the-empty-home-tax-to-be-unveiled/

     

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Jan 07

Today’s News 7th January 2017

  • The False Economic Recovery Narrative Will Die In 2017

    Submitted by Brandon Smith via Alt-Market.com,

    Yes, the narrative of the “new normal” has been around for so long now that many people have simply grown used to it. The assumption is that the fiscal “new normal” has become the fiscal “normal,” and though the fundamentals continue to strain under the weight of poor global demand and historic debt levitated by extraneous fiat stimulus, the masses feel far less fear than is warranted. Hey, why should they? We’ve managed around eight years skating on thin ice, why shouldn’t we expect eight more years of the same?

    The banking elites have done the job they set out to do, which was to drive the economy to the very edge of the financial cliff, and then keep it suspended there until the general public became comfortable living next door to the abyss.

    Why do this? Well, the greater dynamic at play here is something the average person will not understand or refuses to examine — economics today is about mass psychology. The economy is a tool, or a weapon, by which international financiers can influence the public mind and the emotions of the mob. In order to grasp the mechanics of economics it is not enough to deal in statistics and trade principles; one must also grasp human behavior and how it is manipulated. One must acknowledge that in economics we witness the transmutation of societies by word and by force, by chaos and by order. Economics is alchemy.

    The globalists (in their twisted view) seek to change lead into gold, and just as in alchemy, these elements are a metaphor for psychological evolution. For the globalists, social engineering is a form of witchcraft; they see it as creation, or a grand form of architecture.

    But it is not creation. The globalists are incapable of such art because true art requires wisdom and empathy. All they know is how to deconstruct existing systems generated by nature and free men and rearrange the shattered pieces into something more oppressive and ultimately less interesting than what existed before. Give the internationalists a Mona Lisa and they will shred it, reconstitute it and regurgitate a paint by numbers coloring book.

    The globalists only know how to turn gold into lead.

    If you do not understand the reality of globalist influence in markets and the nature of economics as a weapon; if you actually believe that the economy operates purely on some kind of free-roaming free market principles, then you will never be able to wrap your head around the otherwise absurd behavior of our financial structure.

    The psychology of fiscal “recovery” is a vital tool for change and for developing false dichotomies. For example, I recently came across this article from the pervasive propaganda hub of Bloomberg. In it, Bloomberg outlines a story we are by now very used to hearing from the mainstream — that the presidential era of Barack Obama has left the economy of the U.S. in particular in “far better shape” as he leaves office than when he entered office.

    Now, anyone who has been reading my analysis for at least the past six months (if not the past ten years) knows exactly what I think about the current state of the economy and what is likely to happen in the near future. For those new to my position, here is a very quick summary along with linked evidence supporting my claims:

    From the 1990’s leading into the year 2007, the Federal Reserve engineered a massive debt and derivatives bubble through the use of artificially low interest rates in the housing market. Alan Greenspan, the presiding Fed chairman at the time, openly admitted in interviews that the central bank KNEW an irrational bubble had formed, but claims they assumed the negative factors would “wash out.” This is a constant meme set forward by the Fed — that they were essentially too stupid to foresee a collapse of the bubble they knew they had created. They prefer that the public believes that the Fed was “incompetent” rather than deliberately destructive.

     

    The low rates fueled a machine of mortgage backed securities and derivatives based on trillions of dollars in loans to people that had no ability or no intention of ever paying them back. The Fed had aid in this program from the ratings agencies, which labeled obviously toxic debt as AAA for years, and the SEC, which refused to investigate any legitimate claims of asset manipulation and ill intent. This corrupt behavior on the part of the SEC was showcased in the testimony of SEC whistle blower Gary J. Aguirre, who warned of dangerous debt pools and manipulation within the banking industry in 2006 before the derivatives collapse and also warned that the SEC interfered with any investigation attempts into the problem.

     

    This led to the well known “Great Recession” triggered in 2007/2008. The Fed along with numerous other central banks around the world had conjured a crisis and then offered their own solution to that crisis. Namely, the solution of massive fiat stimulus programs purchasing toxic debt, treasury bonds, corporate stocks and anything else that wasn’t nailed down.

     

    The “bailouts” and quantitative easing projects, however, were actually cover for a far larger program of untold trillions in overnight loans to corporations, domestic and foreign.  A never-ending river of dollars created out of thin air and pumped into companies for near zero interest. It was these free overnight loans that allowed international conglomerates to sidestep the monstrous black hole of derivatives debt they were circling and purchase their own stocks through stock buybacks, thus reducing the number of existing stocks on the exchanges and artificially boosting the price of the remaining stocks. This caused stock markets to skyrocket from near death to historic highs.

     

    In the meantime, government bureaucracy has worked tirelessly to manipulate statistics to falsely reflect an overall recovery. The stock market is much easier to manipulate than the fundamentals, so, the fundamentals must be misrepresented.  While some numbers slip through the cracks and issues of true supply and demand continue, the vast majority of the populace has little clue that the collapse of 2008 never actually stopped, it was just shifted into a state of slow motion.

     

    The Fed’s low interest rates, specifically on overnight loans, has allowed the economy to sputter along for eight years, and has greatly enriched the top .01% in the process. But now, their strategy is changing.

     

    The problem is that stimulus has a shelf life, and while certain stats can be skewed and the stock market can be inflated for a time, eventually, consequences must be accepted in the real economy for attempting to defy gravity for so long.

     

    The initial collapse was designed to foster an even greater event. Without the derivatives bubble, the central bankers never could have convinced the masses to accept the idea of a fiat stimulus bubble which would eventually put the dollar at risk, along with the overall U.S economy. Taking the brunt of the 2008 crash would have been painful, but not insurmountable. But with eight more years and tens of trillions in added debt along with increased geopolitical tensions and an equities bubble for the ages, the scale of the final stage of collapse will be truly unprecedented.

     

    The purpose of this final event will be to generate so much chaos and desperation that the public will be compelled to search for extraordinary solutions. The globalists will be ready with those solutions, including those they have openly outlined decades in advance in publications like The Economist.

     

    The end game? The formation of a single monetary and economic authority under the management of the International Monetary Fund, and the establishment of a single global currency using the IMF’s Special Drawing Rights as a “bridge” for locking national currencies into a harmonized exchange rate until they eventually become pointless, interchangeable and replaceable.

     

    The problem is, the globalists cannot possibly initiate this end game in a vacuum, otherwise, they would take the blame for the inevitable collateral damage to people’s lives as their “great global reset” is undertaken. The globalists need a scapegoat.

     

    Enter Donald Trump, the Brexit Referendum, and the rise of “populist” movements. For the entire first half of 2016, globalists were “warning” non-stop that a rise in populism (conservatives and sovereignty champions) would result in international financial catastrophe. It was as if they KNEW that the Brexit would succeed and that Donald Trump would win the election…

    This has been my position for the past half year — that globalists were planning to allow conservative and sovereignty movements to take the reigns of power, that they would allow the passage of the Brexit and the rise of Trump, just before they pull the plug on the system’s life support. The Federal Reserve in particular has already launched the final phase by beginning a series of rate hikes which will remove the safety net of free and cheap overnight loans to companies, thereby sabotaging equities markets. I specifically warned about this over a year ago when most analysts were stating that negative rates and QE4 were “just around the corner.”

    And this is where we are today. As noted above, Bloomberg writes an interesting bit of propaganda starting with a bit of truth. Here’s the beginning quote from their article:

    “Research suggests factors beyond the control of any U.S. president, not their actual policies, set the course of the economy. Yet with voters, President-Elect Donald Trump will secure much of the praise or blame when it comes to the impact of his agenda over the next four years.”

    The recovery narrative from 2008 to today was imperative to the globalist’s greater agenda. For a considerable portion of the public must be made to believe that under a socialist and decidedly globalist president (Barack Obama) the general trend in the economy was positive and that “things were getting better.” The rise of conservative movements today sets the stage for the final collapse and the IMF’s great reset, in which conservatives and sovereignty activists will be blamed, whether there is any evidence of culpability or not, for the crash that the globalists have spent the better part of two decades setting in motion.

    After the dust has settled, the argument will be that the world was "on course" before the Brexit, before Trump and before populism. The argument will be that globalism was working and conservatives screwed it up with their selfish nationalist endeavors. After the final crash and perhaps numerous deaths from poverty and violence, the argument will be that the only conceivable solution must be a return to globalism in an extreme form; or total global centralization, so that such a tragedy will never happen again.

    Bloomberg helps to set up the scenario, by claiming that Trump is “inheriting” a stable and improving economy compared to the economy that Barack Obama inherited:

    “While today’s economy is a mixed bag by historical standards, one thing is clear: Obama has left Trump a 2016 economy in a better state, by many measures, than when he was first elected president in 2008 in the middle of the worst downturn since the Great Depression.”

    Of course, Bloomberg fails to mention that the standards and statistics by which they measure economic “improvement” are entirely fraudulent.

    For example, real GDP is at -2 percent, not +2 percent as Bloomberg claims, when one calculates for distortions such as government spending, which is counted towards GDP even though government does not actually produce anything. Government can only steal productivity from citizens and reassign that wealth elsewhere.

    Bloomberg also cites a vastly improved unemployment rate. They once again refuse to bring up the fact that over 95 MILLION Americans are no longer counted as unemployed by the Bureau of Labor Statistics because they have been jobless for so long they do not qualify to be included on the rolls. This lie of reduced unemployment has been pervasive through the entirety of the Obama Administration.

    Bloomberg then mentions a greatly improved housing market that Trump will enjoy when he takes office. They certainly do not include the fact that pending home sales are now plummeting and home ownership rates in the U.S. are so low you have to go back to 1965 to match them.   They do not mention that the majority of the boost in home sales during Obama’s two terms was due to corporations like Blackstone buying up distressed mortgages and turning the homes into rentals. The housing market is NOT being supported by individuals and families seeking home ownership, but corporations snatching up real estate on the cheap and driving up prices.  Wall Street is now America's landlord.

    And there you have it. The globalist setup continues with mainstream outlets telling Americans that the economy is in ascension as Trump and populists move into positions of power, when in truth the economy is as dire as it ever was if not worse off. To add to the theater, Donald Trump has ventured to take credit for the sharp rise in stocks and the impression of improving economic stats.  In one of his latest tweets just after Christmas, he had this to say:

    "The world was gloomy before I won – there was no hope. Now the market is up nearly 10% and Christmas spending is over a trillion dollars!"

    Now, if you know anything about the true fiscal situation, you would think this statement is a severely idiotic move by Trump.  No incoming president with any sense would try to take credit for the largest equities bubble in history.  But, take credit is essentially what he did.  That said, if you ALSO understand that the globalist narrative is engineered so that conservatives take the blame for the coming crash, AND if you believe that Trump is knowingly participating in this narrative (as I now do after he lied about "draining the swamp" and front loaded his cabinet with banking elites), then Trump's statement makes perfect sense.  Trump is playing the role of a future bumbling villain, the populist maniac who gets too big for his britches and brings disaster down on people's heads.

    The false recovery narrative will indeed die in 2017, and it will be because the globalists WANT it to die while nationalists are at the helm. This is perhaps the biggest con game in recent history; with conservatives as the fall guy and the rest of the public as the gullible mark. One can only hope that we can educate enough people on this scenario to make a difference before it is too late.

     

  • The High Life: Here Are The States Where The Most People Are Tokin' Up

    After a slew of states across the country have decided to legalize medical and/or recreational use of marijuana, the Washington Post decided to take a look at the impact this new legislation has had on weed consumption by state.  Ironically the map looks a lot like the 2016 electoral college map with the highest levels of consumption per capita coming from the liberal strongholds of New England and the West Coast.  Meanwhile, Montana seems to be the one conservative outlier where people love both their individual liberties and tokin’ up on the reg.

    Overall, a study by the U.S. Department of Health and Human Services found that 22 million Americans like to light up on a monthly basis with closer to 37 million admitting they partake at least once a year.

    According to one estimate by ArcView Group, a marijuana industry consulting firm, the legal marijuana market rang up $6.7 billion in sales in 2016.

     

    Legal or not, millions of Americans already use marijuana regularly. According to the most recent National Survey on Drug Use and Health, 8.3 percent of Americans age 12 and over — 22 million people — used marijuana on a monthly basis in 2015. And close to 37 million people used marijuana at least once that year.

    Weed Use

     

    Meanwhile, it’s readily apparent that the highest marijuana use per capita comes from states where the drug has been legalized for medical and/or medicinal purposes.

    In the 2014-2015 period (years are paired for state-level data to provide bigger sample sizes), nearly a quarter of people in places where recreational pot is legal — like D.C. and Colorado — used some form of marijuana at least once a year.

     

    That’s nearly double the national average, and it’s close to three times the rate for the most pot-abstinent states, like Alabama, Mississippi and Iowa, where around 8 or 9 percent of people age 12 and older use pot yearly.

     

    Generally speaking, the Northeast and the West Coast are the two major marijuana hotbeds in the country. Marijuana use between the coasts is generally lower, with the notable exception of Colorado.

     

    The state-level data shows that places with the most marijuana use generally have some form of legal medical or recreational marijuana available. This is likely a two-way street: places with lax attitudes about marijuana use are more likely to approve legal marijuana, and marijuana availability probably leads to more lax attitudes about use.

    Weed Legal

     

    Finally, for our entrepreneurial readers, we just wanted to highlight that we see staggering opportunities for new KFC and Taco Bell franchises in parts of Montana, Colorado and New England.

    Fast Food

  • The Case Against Fed Reform

    Submitted by Tho Bishop via The Mises Institute,

    This week the 115th Congress was sworn in, and there are some indications that Fed reform may be on the agenda. The combination of populist anger fueled by Ron Paul’s Presidential campaigns and the 2008 financial crisis coupled with the repeated failings of the Federal Reserve to meet their projections has created a rare window for monetary policy to be both politically advantageous, as well as so obviously needed that even politicians can see it.  

    The question now is what sort of reform is on the table.

    Congressional Reforms

    Last Congressional session saw proposals from both the House and the Senate.  

    From the House we have the FORM Act, which would require the Fed to adopt a monetary policy rule and explain to Congress whenever they deviate from that rule. The FORM Act also calls for an annual GAO audit of the Federal Reserve, doubles the number of times the Fed Chairman testifies before Congress, and makes some other tweaks to the makeup and protocol of the Federal Reserve Board. Since the FORM Act passed the House in 2015, there is a good chance we will see it resurrected in 2017.

    On the Senate side, Banking Committee Chairman Richard Shelby has pushed for the Financial Regulatory Improvement Act. Not only does it lack a catchy acronym, but its reforms to the Fed are far more modest than the FORM Act. The meat of the bill focuses on changes to the Fed board. The head of the New York Fed would no longer be appointed the banks board of the directors, but would instead be nominated by the President and confirmed by the Senate – just like the Federal Reserve Chairman. It would also grant powers to the Fed’s regional presidents that currently only reside with the board of directors.

    Though early drafts of the Senate bill called for the Fed to adopt rules-based monetary policy, this ended up being stripped from the final proposal due to Democratic opposition – largely because much of the Hill focus has been on the Taylor rule, which many Fed advocates fear is too restricting.

    The Battle Over the Taylor Rule

    Recently this debate has played out in the pages of the Wall Street Journal with Neel Kashkari and John Taylor exchanging op-eds on the virtues of rules-based policy.

    Though Kashkari begins with a broad attack on monetary rules, it quickly devolves into a focused attack on the Taylor Rule which he argues “effectively turn[s] monetary policy over to a computer, rather than continue to let Fed policy makers use their best judgment to consider a wide range of data and economic trends.” Of course Kashkari ignores that the “best judgement” of Fed policy makers has been widely criticized – and not just by Austrians who oppose any sort of Fed policy at all.

    Kashkari’s allusion to a computer-guided monetary policy is may be an attempt to get readers to conflate recent monetary rules proposals to the views of Milton Friedman that have not aged particularly well. In Taylor’s response, he criticized the portrayal for being dishonest while pointing to various analysis critical of the Fed behavior since the crisis.

    What’s more interesting than the finer details of the debate over the relative virtues of the Taylor rule is how that specific proposal has largely been the single focus of those critical of rules-based policy. Though support for the Taylor rule has become largely split on partisan lines, there is another monetary rule that has growing support from across the ideological spectrum.

    The Appeal of NGDP Targeting

    Following 2008, NGDP targeting has grown from a topic of conversation largely limited to blogs such as Scott Sumner’s The Money Illusion, to something discussed openly among central banks, prominent publications, and even Presidential candidates. The proposal would require a central bank to set a nominal goal for GDP – without taking into account inflation or deflation – and allow it to use a variety of tools to reach that goal. Since the policy gives Fed critics a black and white standard to measure its performance, without putting too many restrictions on the Fed as to ruffle the feathers of Fed proponents, it has been able to build a broad coalition of support. As a result, you have progressives such as Christina Romer and Brad DeLong on the same side as the Cato Institute and the Mercatus Center.

    Of course widespread appeal is not the same thing as sensible policy. As Shawn Ritenour sums up his brilliant refutation of the proposal:

    NGDP targeting advocates end up fostering the monetary illusion that scarcity can be overcome and prosperity can be achieved via monetary inflation.

    Unfortunately policy does not have to be sensible to become reality.

    Should the House succeed in creating pressure on the Senate to act on a version of the FORM Act, it would not be surprising to see the discussion move away from the Taylor rule to NGDP targeting – with advocates selling its broad appeal as its leading virtue. The Fed Audit, which has consistently been fought by the Senate, could easily be dropped – with Republican legislators being able to point to the endorsement of the beltway’s leading libertarian think tanks as evidence of being tough on the Fed.

    The Real Problem with Rules-Based Monetary Policy

    Of course no matter if it is NGDP targeting, the Taylor rule, or even a rule that would have the Fed tie itself to gold – the entire debate about rules-based monetary policy ignores the obvious: rules are meant to be broken.

    We’ve already seen this play out routinely at the Fed, with both sides of the isle usually accusing the Fed of not upholding one side of its current dual mandate. History is littered with examples of government financial institutions ignoring and modifying rules whenever they directly conflict with the judgment of current leaders. As recently as 2015, the IMF arbitrarily changed a long-standing policy on loan requirements so it could help Ukraine. The US government changed long-standing monetary policy rules when faced with a crisis, such as when it cut the dollar’s connection with gold for both domestic and international payments.

    Be it Constitutional rights, contractual obligations, or its own self-imposed rules, when push comes to shove the government officials have proven they will side with their own judgment – no matter what the rule is.

    So while there are certainly arguments to be made in favor of a rules-based Fed over the pure discretion of the current PhD standard, such reform should not be viewed as a solution to the real issue, which is a central bank having a monopoly on money at all. Instead of a Fed reform, we need Fed competition: eliminate legal tender laws, remove the burdensome taxes placed on gold, Bitcoin and other potential currencies, and give Americans a true alternative to Federal Reserve notes for those who want it.

    Anything short of that continues to let the Fed’s monopoly on money continue, and is therefore no real solution at all. 

  • In Stunning Last Minute Power Grab, Obama Designates Election Systems As "Critical Infrastructure"

    In a stunning last minute power grab by the Obama administration with just 14 days left in his Presidency, the Department of Homeland Security released a statement this evening officially declaring state election systems to be “critical infrastructure.”  The statement from DHS Secretary Jeh Johnson defines “election infrastructure” as “storage facilities, polling places, centralized vote tabulations locations, voter registration databases, voting machines” and all “other systems” to manage the election process…so pretty much everything.

    I have determined that election infrastructure in this country should be designated as a subsector of the existing Government Facilities critical infrastructure sector. Given the vital role elections play in this country, it is clear that certain systems and assets of election infrastructure meet the definition of critical infrastructure, in fact and in law.

     

    I have reached this determination so that election infrastructure will, on a more formal and enduring basis, be a priority for cybersecurity assistance and protections that the Department of Homeland Security provides to a range of private and public sector entities. By “election infrastructure,” we mean storage facilities, polling places, and centralized vote tabulations locations used to support the election process, and information and communications technology to include voter registration databases, voting machines, and other systems to manage the election process and report and display results on behalf of state and local governments.

    Of course, it’s likely not a coincidence that the DHS made this announcement just hours after the “intelligence community” declassified their “Russian Hacking” propaganda which basically noted that RT has a very effective social media distribution platform while once again providing absolutely no actual evidence.

    Jeh Johnson

     

    Johnson’s statement goes on to note that while many “state and local election officials are opposed to this designation” he went ahead with his decision anyway, because that’s just what the Obama administration does.

    Prior to reaching this determination, my staff and I consulted many state and local election officials; I am aware that many of them are opposed to this designation. It is important to stress what this designation does and does not mean. This designation does not mean a federal takeover, regulation, oversight or intrusion concerning elections in this country. This designation does nothing to change the role state and local governments have in administering and running elections.

     

    The designation of election infrastructure as critical infrastructure subsector does mean that election infrastructure becomes a priority within the National Infrastructure Protection Plan. It also enables this Department to prioritize our cybersecurity assistance to state and local election officials, but only for those who request it. Further, the designation makes clear both domestically and internationally that election infrastructure enjoys all the benefits and protections of critical infrastructure that the U.S. government has to offer. Finally, a designation makes it easier for the federal government to have full and frank discussions with key stakeholders regarding sensitive vulnerability information.

     

    Particularly in these times, this designation is simply the right and obvious thing to do.

    Of course, one of the most vocal opponents of this move has been Georgia Secretary of State Brian Kemp who recently told Politico it is nothing more than an attempt to “subvert the Constitution to achieve the goal of federalizing elections under the guise of security.”

    During an earlier interview with the site Nextgov, Kemp warned: “The question remains whether the federal government will subvert the Constitution to achieve the goal of federalizing elections under the guise of security.” Kemp told POLITICO he sees a “clear motivation from this White House” to expand federal control, citing Obama’s health care law, the Dodd-Frank financial-reform legislation and the increased role of the Education Department in local schools.

     

    To some election officials, this sounds like the first stage of a more intrusive plan.

     

    “I think it’s kind of the nose under the tent,” said Vermont Secretary of State Jim Condos, a Democrat. “What I think a lot of folks get concerned about [is] when the federal government says, ‘Well, look, we’re not really interested in doing that, but we just want to give you this,’ and then all of a sudden this leads to something else.”

    Meanwhile, Kemp continued on by noting that “this administration only has 15 days left in its term” and to make such a critical decision during the 11th hour “smacks of partisan politics.”

    But we’re sure it’s nothing, Obama doesn’t really strike us as the type to play the “partisan politics” game.

  • Worst. Recovery. Ever.

    As the champagne glasses clink in Washington over a record-breaking streak of job growth on record (as the percent of the population employed slumped), and the fastest wage growth since the start of the recovery (for managers), we just wanted to remind a few blinkered media types that Obama’s “recovery” has officially been the worst recovery in US history (despite adding almost $10 trillion to the national debt)…

    When ‘fake news’ and ‘peddling fiction’ meet fact…

    Source: JPMorgan

    Not quite as rosy an economic handover to Trump as The White House would like everyone to believe.

  • John Harwood Asks "Who Do You Believe America?" – Gets Surprising Answer

    CNBC Political reporter, friend of Hillary, and Democratic Party sycophant John Harwood took to Twitter last night to ask:

    “Who do you believe America? Wikileaks, or US Intel Officials?”

    The response, which emerged from his immediate following which one would surmise, should gravitate toward Harwood’s liberal ideology and thus respond in a way Harwood expected, was yet another slap in the face for the establishment’s perspective on how the world should really run.

    And that Mr. Harwood is why Donald Trump is about to become President! When will you and your ilk wake up to this?

    As Trump tweeted earlier in the week: “It is for the American people to make up their minds as to the truth.”

    This merely confirms Lou Dobbs’ survey from earlier in the week.

  • The Fourth-Generation War

    Submitted by David Galland via GarretGalland.com,

    For most people, the term “4GW” will conjure visions of a new and improved data service for their mobile devices. For members of the military and intelligence community, 4GW means something entirely different: Fourth-Generation Warfare, a form of warfare where the lines between civilians and combatants, political and military goals, and even the weapons to be used in fighting the war are blurred.

    Smudged to the point where even identifying the warring parties is difficult.

    To understand the 4GW, look no further than last month’s attack on a Christmas market in Berlin, Germany.

    • Instead of using a bomb, gun, or even a knife, the attacker used a commercial truck.
    • The attacker was from Tunisia, a country with no clear grievances against the Germans.
    • He was an adherent of Islam (natch). Given the attack was directed against innocent bystanders at a Christmas market, we assume—but don’t know—that it was motivated by a religious goal. But to what end? We can have no idea.
    • And why Germany, the country that had provided succor to the man and his family as refugees? Was the attack part of a broader strategy to complete the Islamization of Germany? All of Europe?
    • Or was it to force the Europeans to withdraw from the Middle East—even though the European footprint in the Middle East is barely visible compared to the US and Russia?
    • Perhaps it was just a target of convenience—in which case, what’s the point(s) the attacker was trying to make?
    • And who, exactly, is the enemy the “West” is fighting against? Is it ISIS, which took credit for the attack? We think that’s right, but really can’t know. Maybe the ISIS spokesperson was just being opportunistic in taking credit for an act of an individual who had become overly emotional as a result of indoctrination by a radical mullah?
    • Who does Germany retaliate against? They could lob missiles into ISIS strongholds, but as those strongholds are not citadels, but rather cities populated by innocents—captives even—how effective can that be?
    • Alternatively, whom does Germany negotiate with to bring an end to the hostilities?

    I could go on, but I think the point is clear: 4GW warfare is so distributed—between weapons, tactics, cultures, places, ideologies, and leadership—that dealing with it requires an entirely different approach.

    Trying to get a handle on how one counters such an amorphous enemy, because it is unlikely the attacks will stop anytime soon, and maybe not in our lifetime, I reached out to Scott Taylor, publisher and editor of Esprit de Corps magazine. Scott has extensive experience in the Middle East, as a soldier, author, and war correspondent.

    He is also one of the few people to have been kidnapped by Islamists and lived to tell about it. Here’s a biographical sketch from the Esprit de Corps website.

    For more than 25 years, Taylor has reported from numerous global hot spots, including Kuwait, Cambodia, Western Sahara, Croatia, Bosnia, Serbia, Kosovo, Iraq, Nagorno-Karabakh, South Ossetia, Libya and Afghanistan. In 1996, Taylor won the prestigious Quill Award and in 2008 he was named Press TV’s “Unembedded Journalist of the Year.” In 2011, Taylor won a Telly Award for the CPAC documentary Afghanistan: Outside the Wire.

    On September 7, 2004, while reporting on the U.S. occupation, Taylor was taken hostage in Northern Iraq by Ansar al-Islam Mujahadeen. Taylor and his Turkish colleague were subjected to torture and severe abuse before being released five days later. That harrowing ordeal was recreated by National Geographic Channel in an episode of the popular series Locked Up Abroad.

    With Scott’s bonafides established, here are my questions and his answers.

    Q. Are there any historical precedents for the current conflict being fought between the Islamists and the Western world?

    First of all, we need to stop misidentifying the current conflict as Islam versus the West. The vast majority of the blood being spilled in all of these theatres (Iraq, Syria, Libya, Afghanistan, Turkey) is Muslim vs. Muslim.

    The simplistic division of sides is Sunni versus Shiite, but that further divides into secular versus fundamentalist, and then again into ethnic factions (example: Kurd versus Turk, Arab versus Kurd). Much like the Crusades of old, it is the West’s interference in their territorial squabbles that makes us a target for retaliation.

    Q. Is there any sort of prevailing theory about how a government can fight back given the lack of any clear enemy or even stated objective for the attacks?

    The current tactic of Western security forces appears to be the mounting of large shows of force after a terrorist attack has taken place. Hordes of heavily armed police with armored vehicles appear at all major transit hubs and public spaces to present the appearance of an armed camp.

    However, given the randomness of the targets, the variety of weapons employed (simply driving a truck into a crowd, for instance), and the apparent willingness for the attackers to die for their cause, makes these attacks all but impossible to defend against.

    Q. The Israelis, which arguably have the most experience in fighting a 4GW conflict, have used retribution against family members of the terrorists— including the controversial policy of destroying family homes—as a countermeasure. Any thoughts?

    If the Israelis and Palestinians were presently cohabitating in a state of mutual bliss, I would say that they were on the right track. However, as Israel remains in a state of perpetual threat of attack, I would say that employing retaliatory attacks against a culture steeped in revenge (an eye for an eye) is not a smart move.

    If Trump starts attacking terrorist families, the violence cycle will only accelerate… and become far more personal.

    Q. Any sense of how this all ends? Or is this conflict likely to be with us for the foreseeable future?

    Humankind is the most self-destructive species on the planet. Historically, we continue to invest in ever more creative ways to kill our fellow humans… and to protect ourselves from evolving threats.

    The map of the Middle East will need to be redrawn to recognize the existing ethnic divisions (as opposed to the arbitrary colonial boundaries drawn up by Britain and France in 1917). The abject poverty and illiteracy of Afghanistan will condemn it to decades more bloodshed, and countries such as Libya will need to be reunified by force and subdued for a generation before they can once again enjoy stability and prosperity.

    Q. Do you believe the US should stop meddling in the Middle East? Having read a fair bit on the history of the Crusades, it is revealing that so many cities regularly under attack back then are again under attack now. And, per your comments, invariably by other Muslims. Given that history, one can only ask, "Why would any outside nation want to deal with that mess?"

    If the US could divest itself of the need to import oil, they could afford to ignore events in the Middle East. It may sound crazy, but a huge opportunity was missed in the aftermath of 9/11 when Americans might have accepted (or been forced to accept) wartime rationing of fuel. This would have hurt the automobile industry but at the same time created a massive boom for alternative modes of transportation, such as production of e-bikes and mass transit systems.

    America, like Canada, is protected by the Atlantic and Pacific Oceans. Our “defense” departments should be correctly called “war departments.”

    So, what’s the new administration to do?

    Carry On

    Per Scott’s comments, I think it behooves us to accept the reality that there may be little, and maybe nothing, the nation-states with all their intelligence services and blunt military power can do to stop the 4GW enemies.

    Repurposing the prescient words of John F. Kennedy on the topic of assassins, "If anyone wants to do it, no amount of protection is enough. All a man needs is a willingness to trade his life for mine."

    Time and again, the Islamic terrorists have shown a willingness to trade their lives to carry out their dastardly deeds. That’s just how they roll.

    If there is good news, it is that the damage these terrorists do is typically limited. Returning to the Christmas attack in Berlin, that attack took the lives of 12 people. Approximately the number of people who die every day and a half in German automobile accidents. So while the attack was unsettling, especially for the victims or someone close to the victims, it poses no existential threat to the German nation.

    Even 9/11—the apex of success as far as these attacks go—adds up to just 31 days of traffic fatalities in the US.

    Could the jihadists someday succeed in getting their hands on nukes? Or blow up a liquid petroleum depot near a population center? Anything is possible. However, governments around the world are acutely aware of the threats and take measures to guard the targets with the potential for causing mass destruction. It will take more than a maniac driving a truck or wielding an AK-47 to breach one of the more sensitive installations.

    As a consequence, the path of least resistance suggests the 4GW will continue to unfold mostly as low-level attacks that, in the overall scheme of things, do little physical damage.

    Keep in mind that, on average, 43 people are murdered every day in the US and 93 die in car accidents. By comparison, in the 16 years since 2000, there have been a total of 3,064 people killed by terrorists in the United States, but of that number, 2,997 died in the 9/11 attacks.

    Doing the math, outside of that horrific event, there have been a total of 67 people killed in the US by terrorists over the past 16 years. Which means that over the period, death by terrorism in the US doesn’t add up to even a single day of automobile fatalities.

    To be clear, my purpose here is to provide perspective about the fourth-generation war. That perspective is necessary given how energetically the mainstream media sensationalizes every attack, even if it only involves a single stabbing. By doing so, they have effectively turned the entire nation into fear-biters.

    That’s not to say that terrorism isn’t a concern. It’s just, per Scott’s comments above, that most of it involves fighting between Muslim sects in a very limited number of countries. This from a comprehensive report on global terrorism by the US State Department:

    Although terrorist attacks took place in 92 countries in 2015, they were heavily concentrated geographically. More than 55% of all attacks took place in five countries (Iraq, Afghanistan, Pakistan, India, and Nigeria), and 74% of all deaths due to terrorist attacks took place in five countries (Iraq, Afghanistan, Nigeria, Syria, and Pakistan).

    Here’s a tip: Don’t live in Iraq, Afghanistan, Nigeria, Syria, or Pakistan.

    While incidents like the truck attacks in Nice and in Berlin get a lot of media attention, when viewed from an actuarial perspective, they are gnats on an elephant. And it’s important to keep this in perspective, because overblown fears within the population provide license to the state to expand its powers and trample the rights of the individual in pursuit of a perfect level of security that simply cannot be attained.

    It is worth noting that since 9/11, the United States has spent over $7.5 trillion in defense and homeland security, much of which cannot even be accounted for.

    And that tally is just the thin edge of the cost of overreacting to the terrorists, a cost that includes the loss of personal freedom and the creation of indelible bureaucracies that grow in power every day.

    Remain vigilant, sure. But above all, as the Brits like to say, “Keep calm and carry on.”

  • "Depressed" Millennials Are Convinced The Trump Economy Is Going To Implode

    When asked about the economic outlook for America, millennials were the only generation to predict 2017 would be worse than 2016. As Bloomberg reports, the feeling of impending doom wasn’t exclusively reserved for 2017: about a third of millennials surveyed said they don’t think they’ll have enough money to comfortably retire at all.

    While the new year marks a fresh start for many, millennials aren’t so optimistic.

    In fact, this generation is the only one to say they’re feeling worse, financially, about 2017 than 2016.

    As Bloomberg details, in the days following the election, Country Financial Group, an insurance and investment firm, conducted its annual financial security index and found that the score was lowest for millennials, defined as those between 18 and 34 years old, at 60.9 (the highest score is 100).

    To determine its score, used a survey that asked over 1,000 Americans questions about their financial stability, like whether they had savings, or if their assets were adequately assured. Independent research firm GfK collected the data. Generation X-ers, (people aged 35 to 49), had a score of 66.6. Boomers (between the ages of 50 to 64) came in at 69.2. The Silent Generation, defined as those over age of 65, had the highest score at 71.2.

    As Bloomberg notes, given that the poll was conducted in the days following the election and millennials overwhelmingly supported the losing candidate, these survey results might be swayed by some election-related depression.


  • Florida Shooter Had Been Sent To A Mental Hospital Over "ISIS Ties", Was Investigated For Child Porn

    As more details emerge about the Ft. Lauderdale airport shooter, Esteban Santiago-Ruiz, 26, who on Friday afternoon opened fire at the baggage claim area at the airport, killing 5 and wounding 8, we start to get a detailed glimpse not only into his past, but his numerous recent interactions with authorities.

    Esteban Santiago, the suspected shooter at Ft. Lauderdale Airport on Jan. 6, 2017

    According to law enforcement officials, Santiago was found with an active military ID and is an American citizen, born in New Jersey. Previous known addresses include Penuelas, Puerto Rico and Anchorage, Alaska.

    They add that in November 2016, just two months ago, he walked into an FBI office in Anchorage claiming that the government had “forced him to watch ISIS videos” and to fight for ISIS. According to a slightly different narrative presented by CNN, source said that Santiago was hearing voice telling him to join the Islamic State. Ultimately he was sent to a psychiatric hospital.

    AP confirms that Santiago’s brother said the suspect had been receiving psychological treatment while living in Alaska. Bryan Santiago told The Associated Press that his family got a call in recent months from 26-year-old Esteban Santiago’s girlfriend alerting them to the situation.

    Bryan Santiago said he didn’t know what his brother was being treated for and that they never talked about it over the phone. He said Esteban Santiago was born in New Jersey but moved to the U.S. territory of Puerto Rico when he was 2 years old.

    He said Esteban Santiago grew up in the southern coastal town of Penuelas and served with the island’s National Guard for a couple of years. He was deployed to Iraq in 2010 and spent a year there as a combat engineer with the 130th Engineer Battalion, the 1013th engineer company out of Aguadilla, according to Puerto Rico National Guard spokesman Maj. Paul Dahlen.

    Sen. Bill Nelson of Florida said that the gunman was carrying a military ID that identified him as Esteban Santiago, but that it was unclear whether the ID was his. Nelson gave no further information on the suspect.

    As CBS adds, in 2011 or 2012, Santiago was investigated by Homeland Security Investigations for child porn. Three weapons and a computer were seized, but there was not enough evidence to prosecute, according to law enforcement sources. Santiago also has a record for minor traffic violations and was evicted in 2015 for not paying rent.

    Furthermore, AP notes that according to a  military spokeswoman Santiago received a general discharge from the Alaska Army National Guard last year for unsatisfactory performance.

    Lt. Col. Candis Olmstead did not release details about 26-year-old Esteban Santiago’s discharge in August 2016. Olmstead said that he joined the Guard in November 2014.

    Puerto Rico National Guard spokesman Maj. Paul Dahlen said that Santiago was deployed to Iraq in 2010 and spent a year there with the 130th Engineer Battalion, the 1013th engineer company out of Aguadilla. Olmstead also said that Santiago had served in the Army Reserves prior to joining the Alaska Army National Guard.

    Previously, a spokeswoman from the Canadian Embassy says the suspect in the shooting at the international airport in Fort Lauderdale has no connection to the country and did not fly to Florida from there. Embassy spokeswoman Christine Constantin said in an email to The Associated Press that the suspect did not travel from Canada and was not on an Air Canada flight. She says the suspect has no connection to Canada.

    The shooting happened at the airport’s terminal 2, where Air Canada and Delta operate flights. Five were killed and eight wounded. Constantin’s email says, “We understand from officials he was on a flight originating in Anchorage, transiting through Minneapolis and landing in Ft. Lauderdale.”

    Meanwhile, authorities are looking into what event may have set off the unstable Santiago.

    Law enforcement sources said the suspected gunman in a deadly attack at Fort Lauderdale-Hollywood International Airport got into an argument during his flight from Alaska to Florida. They’re now investigating whether that’s what set off a shooting rampage CBS reports.

    Esteban Santiago-Ruiz, 26, took a flight from Alaska to Florida Friday with a stop in Minnesota, officials said. Somewhere along the way, he got into an argument.

    According to Broward Commissioner Chip LaMarca, Santiago-Ruiz arrived from a flight with a gun that he checked in. “He claimed his bag and took the gun from baggage and went into the bathroom to load it. Came out shooting people in baggage claim,” LaMarca said.

    Earlier reports claimed Santiago-Ruiz came in on a flight from Canada. On the company’s Twitter account, Air Canada confirmed that no one by that name was on their flight. Air Canada flights arrive to Terminal 2, where the shooting took place.

    Police were able to apprehend the suspect without having to fire their own weapons when he apparently ran out of bullets.

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Jan 06

Today’s News 6th January 2017

  • Silver Dumps, Peso Jumps As Mexican Central Bank Intervenes (Again)

    If at first you don't succeed, intervene again! For the second time today (at midnight ET), Banxico officials confirmed the central bank entered the market to sell US dollars in an attempt to strengthen the peso. Now we await the next Trump tweet to take the peso back down…

    As Bloomberg reports, according to a Banxico official who asked not to be identified, the central bank is looking to strengthen Mexican peso.

    For now the move is far less impressive – which is odd given the lack of liquidity and an irrational peso buyer…

    We have one other question… Is Banxico dumping its silver to receive dollars to sell to buy pesos?

    Around $200mm notional of Silver was dumped in those few minutes.

    As we noted at their earlier attempt, we can't really blame Banxico for intervening: with the local population, of which over half lives in poverty, angry and protesting the recent "Gasolinazo", or 20% increase in the price of gas, the crashing currency is sure to send many other prices, especially of imported goods, through the roof while sending much of the population over the edge. Which is why Goldman's Alberto Ramos agrees that the central bank had to do something:

    "In our assessment, some FX market intervention at this juncture is justified since market liquidity conditions became somewhat tighter, the MXN entered overshooting territory (excessively undervalued) and from current levels, significant additional exchange rate weakness, while making exporters even more competitive, can threaten two valuable public goods: price and local financial market stability. A very weak currency can have significant medium-term costs for the broader economy as it is likely to add pressure on inflation and wages (which would over time reduce the cost-competitiveness of the Mexican exporters) and prompt to a tighter monetary stance. Overall, higher inflation/wages and higher rates would be a clear negative shock to the non-tradable sectors of the Mexican economy, for they would not enjoy the exporters (tradable sectors) benefit of a weak currency.

    So much for a "brave new world" in which global trade imbalances can be resolved without central bank intervention. If anything, the events from the first 4 days of 2017, in which we first saw a dramatic indirect intervention by the PBOC which sent the overnight CNH deposit rate to the highest ever in a desperate attempt to crush shorts, and then the Mexican direct intervention, have confirmed that 2017 will be very much like 2016 when it comes to central bank intervention, if not more so.

    However, as Goldman admits, Banxico made one mistake which explains why virtually the entire post-intervention move has been faded:

    In our assessment, if the MXN remains under pressure the authorities should entertain the possibility of using different intervention instruments, such as USD Dollar swaps, for they are not a direct claim on reserves and offer valuable FX hedging protection to the market in a period of significant uncertainty but no large spot market outflows.

    There is a problem with using reserves to fight a currency war, one which China is very familiar with:

    On the other hand, using USD swaps is precisely what the PBOC shifted to late in 2015 (perhaps as advised by Goldman then too) when it too realized that using reserves was a very rudimentary (if effective) attempt at intervention. The only problem is that it eventually catched up to the central bank, and just like in the case of China which used swaps for about 3-4 months even as the capital outflows persisted, it ultimately had to return to draining reserves for a full blown intervention.

    Ironically, even that has failed, and as we have documented extensively in the past 2 months, the PBOC is now scrambling with intraday gimmicks like crushing shorts using deposit rates. That too only works for a while.

    Meanwhile, Mexico is caught between a rock and a hard place, because while the currency is depreciating, and the "MXN is now visibly undervalued versus theoretical fundamental fair-value under any of the three model metrics we use" Goldman warns that any further depreciation can undermine the inflation backdrop and/or risk unleashing destabilizing financial forces.

    Which is all Trump needs: a several economic crisis just south of the border.

    Actually, there is another thing Trump "needs": Mexico launching an all out currency war against the US, whether through reserve draining (which would hit US assets) or USD swaps. Should the central bank intervene on a few more occasions to offset today's failed revaluation attempt, which the market is now openly mocking, we eagerly await the barrage of tweets that will be launched by the Trump account as the president-elect, having slammed the occasional stock, shifts to FX.

    Trump aside, what happens next? Once today's intervention fails, the Peso is looking at a lot more downside, and as Rabobank's Christina Lawrence writes,the MXN could fall as far as 23, as there "is little room for MXN relief as Banxico is highly unlikely to provide any lasting support for peso as market is too liquid and Mexico’s reserves will start to evaporate very quickly." Putting trading volumes in context, MXN is the 10th most liquid currency globally with an average daily volume in the spot market of $43b and $112b when including options.

    Rabo says that it “expects volatility to rise further and for the skew to continue moving to the right as market participants move to protect themselves from further USD/MXN upside”

    Finally, the real message here is that the Banxico’s intervention "may also be seen as sign of greater underlying problems." Bingo.

  • DNC Refused FBI Access to Its Servers … Instead Gave Access to a DNC Consultant Tied to Organization Promoting Russia Conflict

    CNN reports:

    The Democratic National Committee "rebuffed" a request from the FBI to examine its computer services after it was allegedly hacked by Russia during the 2016 election, a senior law enforcement official told CNN Thursday.

     

    "The FBI repeatedly stressed to DNC officials the necessity of obtaining direct access to servers and data, only to be rebuffed until well after the initial compromise had been mitigated," a senior law enforcement official told CNN. "This left the FBI no choice but to rely upon a third party for information.

     

    ***

     

    The FBI instead relied on the assessment from a third-party security company called CrowdStrike.

    As first reported by George Eliason, CrowdStrike's Chief Technology Officer and Co-Founder Dimitri Alperovitch – who wrote the CrowdStrike reports allegedly linking Russia to the Democratic party emails published by Wikileaks – is a fellow at the Atlantic Council … an organization associated with Ukraine, and whose main policy goal seems to stir up a confrontation with Russia.[1]

    The Nation writes:

    In late December, Crowdstrike released a largely debunked report claiming that the same Russian malware that was used to hack the DNC has been used by Russian intelligence to target Ukrainian artillery positions. Crowdstrike’s co-founder and chief technology officer, Dmitri Alperovitch, told PBS, “Ukraine’s artillery men were targeted by the same hackers…that targeted DNC, but this time they were targeting cellphones [belonging to the Ukrainian artillery men] to try to understand their location so that the Russian artillery forces can actually target them in the open battle.”

    Dmitri Alperovitch is also a senior fellow at the Atlantic Council.

     

    The connection between Alperovitch and the Atlantic Council has gone largely unremarked upon, but it is relevant given that the Atlantic Council—which is funded in part by the US State Department, NATO, the governments of Latvia and Lithuania, the Ukrainian World Congress, and the Ukrainian oligarch Victor Pinchuk—has been among the loudest voices calling for a new Cold War with Russia. As I pointed out in the pages of The Nation in November, the Atlantic Council has spent the past several years producing some of the most virulent specimens of the new Cold War propaganda.

     

    It would seem then that a healthy amount of skepticism toward a government report that relied, in part, on the findings of private-sector cyber security companies like Crowdstrike might be in order.

    The Atlantic Council is also funded by the U.S. military and the largest defense contractors, including:

    • United States Army
    • United States Navy
    • United States Air Force
    • United States Marines
    • Lockheed Martin
    • Raytheon
    • Northrop Grumman
    • Boeing

    [1]  Here's an example of the Atlantic Council's bellicose rhetoric from July 2016:

    Poland should announce that it reserves the right to deploy offensive cyber operations (and not necessarily in response just to cyber attacks).  The authorities could also suggest potential targets, which could include the Moscow metro, the St. Petersburg power network, and Russian state-run media outlets such as RT.

  • Turkey Threatens To Block US From Using Incirlik Airbase

    In the immediate aftermath of the failed Turkish “coup” of July 2016, the immediate concern to the US was not the fate of the Erdogan regime, but whether the US would maintain access to Incirlik Air Base, a strategic output for the US airforce, allowing it fast and easy access to most of the Middle East and part of Russia even in the immediate absence of an aircraft carrier. It explains why when Erdogan said he felt snubbed by the US, he cut off the power to the US troops stationed at the airbase, and kept them in the dark for a considerable period of time, perhaps to remind Washington that in Turkey he is the boss.

    Fast forward to this week, when on Wednesday, Turkish officials again made a veiled threat to ground U.S. warplanes at Incirlik Air Base over the U.S. denial of air support for the Turkish military inside Syria. The officials questioned the value of having the U.S. fly missions out of Incirlik in southeastern Turkey against ISIS targets in Syria and Iraq while Turkish forces are struggling to take the ISIS-held Syrian town of El Bab.

    “This is leading to serious disappointment in Turkish public opinion,” Turkish Defense Minister Fikri Isik said, adding that “this is leading to questions over Incirlik,” Turkey’s Anadolu news agency reported.

    He then once again treatened the US, when he said that to avoid repercussions that could affect Incirlik operations, the Defense Minister called on the U.S. to “start to provide the aerial support and other support that the [Turkish military] needs” to take El Bab, which would also drive a wedge between Syrian Kurdish militias supported by the U.S. in actions against the Islamic State of Iraq and Syria.

    U.S. Air Force Col. John Dorrian said Wednesday than any actions by Turkey to shut down or limit U.S. air operations out of Incirlik would be disastrous for the U.S. anti-ISIS campaign now focused in Syria on the drive by a mixed Syrian Kurdish and Arab force against Raqqa, the self-proclaimed ISIS capital. What he meant to say is that it would disastrous for the U.S., period, as it would deprive the US of one of its most critical military outputs in the MENA region.

    12 F-15s from RAF Lakenheath, UK are deployed to Incirlik AB, Turkey, November, 2015

    “It’s absolutely invaluable,” Dorrian, a spokesman for Combined Joint Task Force-Operation Inherent Resolve, said of Incirlik. “Really, the entire world has been made safer by the operations that have been conducted there.” Well, that or precisely the opposite – it all depends on one’s point of view.

    Turkey briefly closed its airspace to U.S. operations out of Incirlik last July and cut off power to the base during the failed military coup against the government of President Recep Tayyip Erdogan when suspicions ran high among Turkish officials that the U.S. may have supported rebels within the military.  As the coup attempt failed, a high-ranking Turkish officer walked across the Incirlik airfield and tried to turn himself into the U.S. military to seek asylum. His request was rejected, and he was arrested by Turkish authorities.

    On Wednesday, Turkish Foreign Minister Mevlut Cavusoglu said, “The U.S. is a very important ally for us. We have cooperation in every field, but there is the reality of a confidence crisis in the relationship at the moment” over Incirlik and the El Bab offensive, which Turkey has named Operation Euphrates Shield. “Our people ask, ‘Why are they [the U.S. and coalition warplanes] using the ?ncirlik air base’ ” if they won’t back up Turkish forces against ISIS and the Kurdish militias considered terrorists by Turkey? “What purpose are you serving if you do not provide aerial support against [ISIS] in the most sensitive operation for us?”

    U.S. officials have confirmed they are withholding airstrikes from the El  Bab offensive while maintaining overall support for Turkey’s anti-ISIS efforts inside Syria, aimed at sealing off border areas. On Tuesday, Pentagon Press Secretary Peter Cook said that U.S. aircraft flew near El Bab on Monday but did not conduct any strikes. In a briefing from Baghdad to the Pentagon on Wednesday, Dorrian suggested that weather and poor intelligence on the disposition of friendly forces may have been a factors in the decision not to attack.

    “The cardinal rule of air support is to do no harm,” Dorrian said, adding that the aircrews may not have had “good fidelity” on enemy positions. The result was “a show of force that was conducted at the request of Turkish forces operating on the ground,” he said.

    Quoted by Military.com, Dorrian said that “there were ongoing discussions at higher levels “to increase the support and operations” by the U.S. military to back Turkish forces, but “I can’t get ahead of those discussions. I don’t have the details to offer you about what the way forward will be in El Bab. But I do know there has been some good discussion on that, and Turkey is aware of that discussion,” he said.

    The loss of Incirlik air base would be a tremendous hit to US influence in the region.

    The U.S. Army Corps of Engineers began construction in 1951 of what was to become Incirlik Air Base, and U.S. and Turkish air forces signed an agreement in 1954 for joint use of the base. Incirlik long served as a deterrent to the then-Soviet Union and as a staging base for U.S. operations in the Mideast.

    Despite recurring reports that US nuclear weapons are store in the base, the U.S. Air Force will neither confirm nor deny. About 5,000 U.S. service members, mostly Air Force, are based at Incirlik; they are currently confined to the base because of unrest in the region. The U.S. last year withdrew military families from Turkey, and the State Department has also sent home non-essential personnel.

    The tensions over El Bab and Incirlik have only added to the downward spiral of relations between the U.S. and NATO ally Turkey, marked by Erdogan’s new alliance with Russian President Vladimir Putin to bring about a ceasefire and peace talks to end Syria’s nearly six-year-old civil war. As reported last week, the U.S. was not invited to a Moscow meeting last month of the foreign ministers of Russia, Turkey and Iran that led to Putin’s announcement last week of the ceasefire and possible peace talks later this month in Astana, Kazakhstan, with rebel groups.

    Turkey has also been angered by what it sees as U.S. foot-dragging on its extradition request for exiled Muslim cleric Fethullah Gulen, now living in Pennsylvania. Erdogan has blamed Gulen for fomenting the July coup attempt. In addition, Erdogan has bridled at U.S. support for the Syrian Kurdish militia known as the YPG, or People’s Protection Units. The YPG has proven to be the most effective fighting force against ISIS in Syria, but Erdogan considers it an arm of the Kurdish PKK, or Kurdistan Workers Party, which has been branded a terrorist group by the U.S. and Turkey.

    A senior U.S. military official, speaking on background last month, told Military.com that the Turks “hate that we support” the YPG.

    Erdogan and other Turkish officials have charged that the U.S. is supplying weapons to the YPG. The U.S., while acknowledging support for the YPG, has denied giving them recent supplies of weapons.

  • Trump Aims To Cut The Neocon Deep State Off At The Knees

    Submitted by Charles Hugh-Smith via OfTwoMinds blog,

    The Neocon-Neoliberals must be fired and put out to pasture before they do any more harm.

    I have long held that America's Deep State–the unelected National Security State often referred to as the Shadow Government–is not a unified monolith but a deeply divided ecosystem in which the dominant Neocon-Neoliberal Oligarchy is being challenged by elements which view the Neocon-Neoliberal agenda as a threat to national security and the interests of the United States.

    I call these anti-Neocon-Neoliberal elements the progressive Deep State.

    If you want a working definition of the Neocon-Neoliberal Deep State, Hillary Clinton's quip–we came, we saw, he died–is a good summary: a bullying, arrogance-soaked state-within-a-state pursuing an agenda of ceaseless intervention while operating a global Murder, Inc., supremely confident that no one in the elected government can touch them.

    Until Trump unexpectedly wrenched the presidency from the Neocon's candidate. The Neocon Deep State's response was to manufacture a mass-media hysteria that Russia had wrongfully deprived the Neocon's candidate (Hillary Clinton) of what was rightfully hers: the presidency. (The Neocons operate their own version of the divine right of Political Nobility.)

    The Neocon-Neoliberals' strategy was to delegitimize Trump's victory by ascribing it to "Russian Hacking," a claim that remains entirely unsubstantiated. Now that this grasping-at-straws Hail Mary coup attempt by a politicized C.I.A. and its corporate media mouthpiece has failed, the Neocon Deep State is about to find out the Progressive Deep State finally has a president who is willing and able to cut the Neocon-Neoliberals off at the knees.

    Trump Is Working On A Plan To Restructure, Pare Back The CIA And America's Top Spy Agency.

    If you want documented evidence of this split in the Deep State–sorry, it doesn't work that way. Nobody in the higher echelons of the Deep State is going to leak anything about the low-intensity war being waged because the one thing everyone agrees on is the Deep State's dirty laundry must be kept private.

    As a result, the split is visible only by carefully reading between the lines, by examining who is being placed in positions of control in the Trump Administration, and reading the tea leaves of who is "retiring" (i.e. being fired) or quitting, which agencies are suddenly being reorganized, and the appearance of dissenting views in journals that serve as public conduits for Deep State narratives.

    I have also long held that Wall Street's political dominance is part and parcel of the Neocon-Neoliberal ideology, and the progressive elements in the Deep State also want to (finally) limit the power of the big banks and the rest of the Wall Street crowd.

    Is the Deep State Fracturing into Disunity? (March 14, 2014)

    The split in the Deep State is a reflection of the profound political disunity that is occurring in the U.S. In other words, it isn't just disunity in the masses or the political elites–it's a division in all levels of our society.

    The cause is not difficult to discern: the concentration of wealth and political power in the hands of the few is generating levels of inequality that threaten democracy, the social order and the vitality of the economy:

    As someone who has studied the Deep State for 40 years, I find it ironic that so many self-identified "progressives" do not understand that the U.S. military is now the Progressive element and it's the civilian leadership–the Neocon-Neoliberals– who are responsible for leading the nation into quagmires and handing the keys to the chicken coop to the wolves of Wall Street.

    When military leaders such as Eric Shinseki questioned the Neocon's insane "strategy" in Iraq–essentially a civilian fantasy of magical-thinking–the Neocons quickly cashiered him (Shinseki was a wounded combat veteran of Vietnam who rose through the ranks–the exact opposite of the coddled never-get-my-hands-dirty Elites in the civilian Neocon-Neoliberal leadership.)

    To the degree that the U.S. has become a Third World Oligarchy owned and controlled by a financial-political Elite, then the U.S. military is one of the few national institutions that hasn't been corrupted by top-down politicization and worship of Wall Street.

    Shinseki et al. did not amass a fortune from Wall Street like Bill and Hillary Clinton. The simple dictum–follow the money–maps the lay of the land rather neatly.

    The Neocon-Neoliberals have run the nation into the ground. They must be fired and put out to pasture before they do any more harm. That includes the Fake-"Progressives" and the fake-"Conservatives" alike who have enriched themselves within the Neocon-Neoliberal Oligarchy.

    If you are surprised that the Democratic Party, the C.I.A. and Wall Street are all hugging each other in the same cozy Neocon-Neoliberal Oligarchic embrace, you shouldn't be. Open your eyes.

    Could the Deep State Be Sabotaging Hillary? (August 8, 2016)

  • Payrolls Preview: Blame Weakness On Weather, Strength On Trump

    With all eyes likely on wage growth indications in the subtext of tomorrow's payrolls report (following The Fed Minutes' comments on full employment), Goldman Sachs is forecasting a better-than-expected 0.3% rebound in average hourly earnings (helped by more favorable calendar effects) and a better-than-expected 180k payrolls print (albeit with a small rise in the unemployment rate). However, they are careful to note that any downside can be blamed on "a considerable drop in temperatures."

    As Goldman Sachs details:

    We forecast that nonfarm payroll employment increased 180k in December, after an increase of 178k in November and 142k in October. On balance, labor market indicators were moderately strong in December, with improvement in the employment components of many service-sector and manufacturing surveys and a rise in consumer confidence to a 15-year high. The key labor market subcomponent of consumer confidence also hovered near its post-crisis high, despite a modest pullback from November. We also expect above-trend payroll growth in the transportation and warehousing industry, driven by elevated hiring related to strong online holiday shopping. On the negative side, initial jobless claims drifted higher and continuing claims posted the largest survey-week-to-survey-week increase in nearly a year. December’s relatively cold payroll survey week could also constrain payroll growth in weather-sensitive industries such as construction, particularly after the warmer-than-usual November.

    We do not expect the end of the election to be a major factor this month. If election-related uncertainty reduced or delayed hiring plans earlier in 2016, the end of the election could potentially catalyze a reacceleration in hiring, as we’ve documented in research studying past elections. However, the reacceleration historically tends to occur over several quarters, and perhaps more importantly, we would not characterize the post-election landscape as one of reduced uncertainty. We will study the industry composition of tomorrow’s reports for signs of an impact from the election, such as above-trend growth in energy or financial services, or below-trend growth in healthcare or import-reliant subindustries.

    Arguing for a stronger report:

    • Service sector surveys. Most of the employment components of service sector surveys improved or remained at encouraging levels in December. The Philly Fed non-manufacturing employment index rose most dramatically to an 18-month high (+5.4pt to +19.7), and the New York Fed index increased to a 9-month high (+1pt to +12.0, SA by GS). The ISM non-manufacturing employment component was disappointing, falling to 53.8 from 58.2, but remains at a level consistent with moderate growth in service-sector employment. Meanwhile, the Richmond Fed (-1pt to +12.0) and Dallas Fed (-1.4pt to +7.8) measures pulled back modestly to levels also consistent with expansion. Service sector payroll employment increased 139k in November and has increased 177k on average over the last six months.
    • Manufacturing sector surveys. The employment components of manufacturing surveys were somewhat stronger in December. The ISM manufacturing employment component rose to an 18-month high (+0.8pt to 53.1), and the Philly Fed (+9.0pt to +6.4) and Kansas City Fed (+9pt to +10) employment components both improved sharply. On the negative side, the Dallas Fed (-7.4pt to -2.9), Richmond Fed (-6pt to -1), and Empire State (-1.3pt to -12.2) employment components all declined into contractionary territory, and the Chicago PMI employment component remained flat. Manufacturing payroll employment declined by 4k in the November report, and has declined by 3.5k on average over the last six months.
    • Job availability. The Conference Board labor differential—the difference between the percent of respondents saying jobs are plentiful and those saying jobs are hard to get—declined modestly to +4.4 from a cycle high +6.6 November. Despite the pullback, this measure has risen 5pt year-over-year and remains 8pt above its 2015 average, suggestive of a strong report. The Conference Board labor differential is historically correlated with economy-wide hiring rates (JOLTS), which slowed during 2016 and have yet to rebound as of October (see Exhibit 2).
    • Transportation Jobs. Transportation and warehousing payrolls have seen elevated readings in recent Decembers (Exhibit 1), as the seasonal adjustment factors have appeared to lag the secular shift toward online holiday sales. We also note the possibility that the seasonal factors have been anchored to some extent by a particularly weak reading in December 2009 (-52k, compared to an average of -10k in the preceding three months and +12k in the subsequent three months). Given the generally positive anecdotes around online holiday shopping, we expect another year of above-trend growth in this industry, which should provide a boost to headline payrolls of roughly 10k relative to its recent trend.

    Exhibit 1: Online Holiday Shipments May Boost December Transportation Payrolls (Again)

    Source: Department of Labor, Goldman Sachs Global Investment Research

    • Hurricane Matthew. We also see a small amount of upside risk from continued bounce-back from Hurricane Matthew, which hit the East Coast in October. Employment across East Coast states in the three sectors that we find are most sensitive to weather– retail, construction, and leisure and hospitality – declined by a total of 17k in October, compared to an average monthly increase of 15k over the prior six months. The November rebound in these state-level industries was fairly lackluster, with +10k total gains across that state-industry grouping. Accordingly, we see a possibility of above-trend December growth (or an upward revision to November) to restore employment levels toward their pre-hurricane trend.

    Arguing for a weaker report:

    • Jobless claims. Initial claims for unemployment insurance benefits moved higher, averaging 261k during the 5 weeks between the November and December payroll survey periods, compared to 253k for the November report. Continuing claims also showed its largest survey-week-to-survey-week increase (+53k) in nearly a year (January 2016). Jobless claims can be difficult to seasonally adjust around this time of the year, and we partially discount the data accordingly. Some of the rise in initial claims may also reflect a return toward mid-year levels after especially low results in late-Q3/early-Q4.
    • ADP. The payroll processing firm ADP reported a 153k gain in private payroll employment in December, down from +215k in November and somewhat below expectations of +175k. In the past we have found minimal incremental predictive power for nonfarm payrolls in the ADP report, with the notable exception of large surprises/deviations. The new methodology ADP introduced in October creates some additional uncertainty around the translation of the somewhat softer ADP data into the outlook for tomorrow’s nonfarm payroll report. Notably, ADP’s measure of healthcare employment has slowed in recent months – even more so than official BLS estimates – and in December rose just 26k, matching the two-year low growth rate achieved last month.
    • Temperatures. The December payroll period featured few notable storms, but saw a considerable drop in temperatures following much warmer-than-usual weather in early and mid-November. Accordingly, December’s relatively cold payroll survey week could constrain job growth in weather-sensitive industries. For example, we anticipate some payback in the construction industry, which has averaged +20k payroll growth in the last three months, compared to trend monthly growth in the 10-15k range.

    Neutral Factors:

    • End of the election. We do not expect the end of the election to be a major factor this month. If election-related uncertainty reduced or delayed hiring plans earlier in 2016, the end of the election could potentially catalyze a reacceleration in hiring, as we’ve documented in research studying past elections. However, the reacceleration historically tends to occur over several quarters, and perhaps more importantly, we would not characterize the post-election landscape as one of reduced uncertainty. Payroll growth did slow during the course of 2016, consistent with the possibility that election-related uncertainty reduced or delayed hiring plans, though dwindling labor market slack represents a second viable explanation. More granular data from JOLTS show a decline in the pace of hiring since the beginning of the year, with a further meaningful drop in hiring in September and October ahead of the election (Exhibit 2). We would note that considerable policy uncertainty remains. For example, the anticipation of policy changes related to health insurance and destination-based taxation could slow hiring in the healthcare sector and in import-reliant industries such as retail, wholesale, and parts of manufacturing. Much like the policy outlook itself, the evolution of business-sector expectations and their implications for aggregate-level job growth remain open questions. In terms of short-term hiring in election-related job categories, note that the BLS makes a special adjustment to estimate and remove these effects in election years, and November payrolls showed no pronounced spike in marketing research categories or government.

    Exhibit 2: Were 2016’s Slower Hiring Rates Election-Related?

    Source: Department of Labor, Goldman Sachs Global Investment Research

    • Online job ads. The Conference Board’s Help Wanted Online (HWOL) report reversed most of last month’s decline, and stands 9% lower than levels last year (vs. -15% yoy in November). However, we put limited weight on this indicator at the moment in light of research by Fed economists that argued that the HWOL ad count has been depressed by higher prices for online job ads.
    • Job cuts. Announced layoffs reported by Challenger, Gray & Christmas after our seasonal adjustment increased by 7k to 34k in December, but the level of announced layoffs remains range-bound and not far from cycle-lows.
    • Seasonals. Since 2010, December payroll growth has surprised positively relative to consensus two thirds of the time (4/6), however the average surprise is slightly negative at -3k.

    We believe the unemployment rate most likely rebounded one-tenth to 4.7% after a 0.3pp drop last month. The unemployment rate fell 0.3pp to an unrounded 4.64% last month, but the decline was mainly driven by the participation rate, as opposed to an acceleration in household employment (which nonetheless rose a respectable 160k in the month). Sharp changes in the participation rate often reverse, and the fact that the second decimal nearly rounded up, we believe a modest rebound to 4.7% is more likely than another 4.6% reading.

    Average hourly earnings likely rose 0.3% after a 0.1% decline in November, as the December survey period ended on the 17th, a relatively late calendar that is historically associated with average or favorable earnings growth. The year-over-year rate is likely to accelerate from 2.5% to 2.8%, which would match the cycle high. Our wage tracker, which captures the broader trend in wage growth across four major indicators, stands at 2.8% year-over-year as of Q3.

    Tomorrow’s employment report will be accompanied by the annual revision to the household survey, with potential revisions to the last 5 years of seasonally adjusted household data. Annual revisions to the establishment survey – as well as the incorporation of updated population estimates from the Census into the household survey – are scheduled for February 3rd. The revisions to the household survey accompanying the December report are usually minor, and last year’s revisions did not result in a change to any of the monthly unemployment rates for 2015.

    *  *  *

    And Ransquawk details the potential market reaction:

    As ever with the NFP release, the headline is likely to garner much of the initial focus with algorithms and fast money moves jumping on any large discrepancies, participants must be aware that moves could be exacerbated and choppy trade likely due to the beginning of January's historic thin trading conditions.

     

    If there is an overwhelmingly strong report, the USD will strengthen across the board however, as the dollar index continues to ramp many analysts consider the dollar upside to be limited and the possible move to lookout for is a poor report, negatively affecting the USD.

     

    As focus detatches from the Fed and interest rates, equity markets are likely to be a much cleaner trade than recent months. Furthermore, with whispers of a reversal in equity markets and many participants still long the market an overwhelming poor report may prove to be a slight catalyst in a bearish push. In terms of technical levels in the S&P 500, November's high at 2214.10 can prove to be some support on the downside and there is an internal downtrend line which originates on 23/08/16 to the next lower high on the 07/09/16 and support likely at 2158.20.

     

    Gold and treasury markets are likely to act in tandem with classic price action in regards to the NFP likely to be evident in flight to safety asset classes, with a strong report likely to cause some risk on sentiment resulting in weakness in both gold and treasury markets and vice versa for a weak report. Participants are likely to keep an eye on fixed income markets, with tight trading ranges evident across the curve throughout December and any discrepancy in either direction could result in some traction.

    And if that fails Buy The Fucking Payrolls Dip no matter what…

  • Ruled by DC: Get The Feds Out Of Western Lands

    Submitted by Ryan McMaken via The Mises Institute,

    In the final days of his administration, President Obama has decided that with the stroke of pen, he shall further consolidate direct federal control over lands within Western states. Specifically, Obama created the Bear Ears National Monument and the Gold Butte National Monument in Utah and Nevada, respectively. The Obama Administration claims that Obama's unilateral edict was necessary because Congress had not passed any legislation on the matter.

    Indeed, the Obama-appointed Interior Secretary stated that "protecting the area using legislation would have been preferable" but that in the absence of legislation, it was necessary to simply declare the lands to be National Monuments. 

    In other words, the democratic, constitutional process of Congressional lawmaking was inconvenient for the President. So, he decided to rule by proclamation instead, giving the Governor of Utah barely an hour's notice before the proclamation was made public. 

    It's Not About Conservation — It's About Federal Control

    Now, we should first note that the overwhelming majority of lands newly designated as National Monument lands were already federal lands to begin with, and have been controlled largely by the US Bureau of Land Management and the Forest Service.

    Moreover, it is not the case that opponents to the new designation are mostly people who want to privatize the land or make it easier to mine or develop the land. In fact, many opponents of the designation oppose it because they fear Monument status will lead to greater development of the area as a tourist mecca.

    In other cases, members of Indian tribes object to making sacred lands part of a federally-controlled National Monument area.

    And, of course, throughout Western states, public lands continue to be a lucrative source of tourist dollars and eco-tourism. The old caricature of pro-conservationist leftists and strip-mining conservatives has long been just that: a caricature.

    The reality is that nowadays many private firms and local governments depend on public lands for their livelihood and revenue, and these groups have quite a bit of influence at the state legislatures in question. Preserving natural spaces from development can mean big business and Western-state politicians know it:

    It is not at all clear that markets or local governments would prefer that land be used for agricultural purposes as opposed to other purposes. For example, were Rocky Mountain National Park to become a locally-controlled park or state park, there is, realistically speaking, zero chance that it would be handed over to ranchers or miners. The park is far too valuable to the local economy as part of the recreation and tourism industries. To turn the park into range land would devastate the economies of the local communities, many of which contain wealthy and influential voters.

     

    But, say that the park were broken up into parcels and sold to a number of private owners. (We're in the realm of pure fantasy at this point.) It would make little sense to use the land for mining or ranching even in this case. Given the infrastructure in place and the relative closeness to a major metropolitan area, the lands in and around the Park are likely far more lucrative for recreational purposes than for mining or ranching. 

    There is little doubt, however, that much of the controversy over the site will be framed like this: on one side are the conscientious environmentalists and others who want to preserve these pristine lands from destruction. On the other side are oil executives who want to strip-mine the land.

    The real debate here, however, isn't over strip mining vs. conservation. It's about whether or not a president thousands of miles away can — with the stroke of a pen — dictate how millions of acres in a faraway state can be used, and do so over the protestations of the state legislature.

    Nor can it be demonstrated that federal agencies are better custodians of lands than are states. Indeed, the federal government has routinely been more inclined to allow overgrazing on federal lands while subsidizing ranchers at taxpayer expense. It is the states that have demonstrated more prudent stewardship of resources.

    Moreover, The Denver post in a 2014 editorial noted other cases in which the federal government hapless mismanaged fish and wildlife issues:

    One has only to look at the great elk management debacle in Rocky Mountain National Park. When populations grew out of control in the park, federal decision-makers chose to pay significant sums to bring in contract killers to thin the herd. A proposal by Colorado wildlife managers to use well-trained hunters and donate the meat to struggling families was cast aside.

    We could further examine the sad case of game fish being electrocuted and buried on the Yampa River in northwest Colorado at the insistence of the U.S. Fish and Wildlife Service to preserve the pikeminnow, while the same pikeminnows are slaughtered and dumped in Washington state to preserve the wild salmon. All of this, in a never-ending nightmare of bureaucratic red tape with no firmly stated goals or objective in sight, by design.

    Moreover, federal lands can be manipulated for political purposes putting local communities at risk.

    Perhaps the most memorable recent example of this occurred in 2013 when the federal government shut down national parks and other federal lands as part of the usual "government shutdown" ploy. The federal government dispatched federal agents armed with assault rifles who forcibly ejected visitors from the allegedly “public lands.” Meanwhile, nearby towns that rely on tourists for the local economy were powerless to open the parks themselves. State officials, who are far more sensitive to local economic needs than members of Congress or the White House, were also powerless to do anything.

    Eventually, after much political pressure was applied, the federal government kindly allowed states to pay millions to the federal government to open the parks again.

    These are just some of the reasons why Utahns of various interests have opposed greater federal power over lands in their states. 

    Federal Lands Are the Problem

    This Obama Administration's move with Bear Ears is the latest "screw-you" to Utah in an ongoing effort by the State of Utah to exercise more control over federal lands. For years now, the Utah legislature and the state's delegation in Congress have been exploring ways to limit federal control over lands within the borders of Utah.

    What is steadfastly ignored in the debate however, is the questionable legitimacy of federal control over so many immense swaths of land. 

    Today, the feds control 640 million acres (not counting the far larger federally-owned areas of coastal sea floor). And in most Western states, the Federal government owns more than a third of all the land. In the case of Utah and Nevada, where the two new monuments are created, the federal government owns 65 percent and 85 percent of all land, respectively.

    This means that these lands are ultimately controlled by politicians thousands of miles away who are not citizens of those states. In the case of Utah, for example, federal lands are controlled by executive-branch bureaucrats — few of whom are from Utah — or they are controlled by Congressional laws passed by a Congress composed of 529 non-Utahns and 6 Utahns.

    The fact that lands in Utah should be largely controlled by Californians, Texans, and New Yorkers — many of whom have never even set foot in Utah — should strike reasonable people as both objectionable and bizarre.

    At the same time, if those lands are truly sacred sites, as some groups contend, then those sites should be Tribal lands and neither federal or state lands. (See "Why Indian-Tribe Sovereignty Is Important.")

    Repeal the Antiquities Act?

    Other observers of the Obama Administration's many executive orders on federal lands have called for the abolition of the Antiquities Act of 1906 which empowers the president to designate federal lands as National Monuments. The Act allows presidents to act unilaterally without any consent from Congress as to how these lands might be designated. Moreover, as critics of the Act note, the Act was supposed to protect small areas of archeological or geographical interest. But, the Act has been abused in order to make many thousands of acres into areas similar to National Parks. 

    Repealing the acts would be a step in the right direction, but it fails to tackle the larger problem of federal lands. After all, if federal lands were not so expansive to begin with, the Antiquities Act would be far more limited in its scope. And, even if Congress were the body designating Monument status, that would only be a tiny improvement. It's true that giving a single person in the Oval office the ability to control lands in faraway states is a problem. However, giving that same control to 535 people in a building down the street form the Oval Office isn't exactly a significant improvement.

     

  • China Prepares For Trade War With Trump

    Having warned U.S. President-elect Donald Trump yesterday, through Chinese state media, that he’ll be met with "big sticks" if he tries to ignite a trade war or further strain ties, China’s central government has reportedly "compiled possible countermeasures" against "well-known U.S. companies or ones that have large Chinese operations."

    As Bloomberg reports, China is prepared to step up its scrutiny of U.S. companies in the event President-elect Donald Trump takes punitive measures against Chinese goods and triggers a trade war between the world’s two biggest economies after he takes office, according to people familiar with the matter.

    The options include subjecting well-known U.S. companies or ones that have large Chinese operations to tax or antitrust probes, the people said, asking not to be identified because the matter isn’t public. Other possible measures include the launch of anti-dumping investigations and scaling back government purchases of American products, according to the people.

     

    The move illustrates how the fallout from escalating tensions between the two nations could spread to companies. Trump has made China a frequent target of his attacks and nominated trade-related officials that the Communist Party’s Global Times newspaper said would form an "iron curtain" of protectionism.

     

    While specific details of China’s options weren’t immediately clear, the retaliatory measures could affect companies related to agriculture, pharmaceuticals, technology and consumer industries, according to the people.

     

    China’s central government compiled the possible countermeasures after collecting opinions from various departments, the people said. The punitive steps would only be carried out if the U.S. acts first and after senior Chinese leaders sign off on them, they said.

     

    Representatives at China’s Ministry of Commerce, National Development and Reform Commission, State Administration of Taxation and General Administration of Customs either didn’t respond or couldn’t immediately comment to Bloomberg queries.

     

    Representatives at Trump’s transition team didn’t respond to a request for comment.

    Today's comments were much more directly aimed than yesterday's more prosaic langauge…

    "There are flowers around the gate of China’s Ministry of Commerce, but there are also big sticks hidden inside the door — they both await Americans," the Communist Party’s Global Times newspaper wrote in an editorial Thursday in response to Trump’s plans to nominate lawyer Robert Lighthizer, who has criticized Beijing’s trade practices, as U.S. trade representative.

    For now China appears to have fallen off Trump's radar (as maybe he is letting them blow themselves up with massive spikes in Yuan and overnight depoist rates as liquidity freezes), and instead over the past few days the president-elect has been focusing on the ongoing Russian hacking fiasco, crashing the Mexican peso, and slamming "head clown" Chuck Schumer for the mess that is Obamacare.

  • Rand Paul Goes Off On Republican Party Over New Budget Resolution

    Submitted by Joseph Jankowski via PlanetFreeWill.com,

    On Wednesday afternoon, one day after reintroducing his Federal Reserve Transparency Act, Senator Rand Paul (R-KY) took to the Senate floor to slam his fellow Republicans for the $9.7 trillion of debt that a newly introduced budget resolution will tack on to the country's already out of control debt total.

    Senate Budget Committee Chair Michael Enzi (R-WY) introduced a budget resolution on Tuesday that is being touted as the first step the newly sworn in congress is taking to repealing Obamacare. The legislation includes “reconciliation instructions” that would allow congress to dismantle the health care law as part of reconciling taxes and spending with the budget blueprint.

    According to Paul, “there is a time and a place to debate Obamacare” but this new piece of legislation is a budget and he is unwilling to support the debt it will accumulate.

    “Republicans won the White House. Republicans control the Senate. Republicans control the House. And what will the first order of business be for the new Republican majority?” Paul asked.

     

    “To pass a budget that never balances,” the Kentucky Senator answered his own question. “To pass a budget that will add $9.7 trillion dollars of new debt in tens years.”

    “Is that really what we campaigned on?” Paul asked on. “Is that really what the Republican party represents?”

    After stating that he is with his fellow Republicans for the repeal of Obamacare, Senator Paul went on to ask “why should we vote on a budget that doesn’t represent our conservative view?”

    “I’m not for it,” Paul said of the potential new debt. “That’s not why I ran for office. That’s not why I’m here. That’s not why I spend time away from my family and from my medical practice. It’s because debt is consuming our country.”

     

    “There is a time and place to debate Obamacare, and I’m more than willing to debate that but this is a budget,” Paul exclaimed.

    The Senator from Kentucky said he will put forth an opposition to the Republican majority’s resolution with his own budget that will freeze spending and create balance over a 5 year period.

    “I will continue to bring up to the American people that it is important not to add more debt,” Paul said.

     

    “At the appropriate time, I will introduce an amendment that will strike and replace this budget and in it’s place I will put forward a conservative vision for the country,” the Senator said. “A vision of a balanced budget that balances within 5 years.”

    Senator Paul has not only made headlines for his opposition to Obamacare as of late, he has also been stirring things up with his recent reintroduction of his Federal Reserve Transparency Act, widely known as the ‘Audit the Fed’ bill.

     

    “No institution holds more power over the future of the American economy and the value of our savings than the Federal Reserve,” Paul said on Wednesday, “yet Fed Chair Yellen refuses to be fully accountable to the people’s representatives.” 

    “The U.S. House has responded to the American people by passing Audit the Fed multiple times, and President-elect Trump has stated his support for an audit. Let’s send him the bill this Congress.”

  • California Farmers Fret Over Labor Shortages As Trump Vows To Deport Their Work Force

    Unbeknownst to most Americans, the Central Valley of California is an agricultural powerhouse producing nearly 50% of all fruits and vegetables grown in the United States, including over 90% of popular items like almonds, carrots and table grapes.  But producing all those fruits and vegetables is extremely labor intensive requiring up to nearly 500,000 laborers each year.  The problem is that those jobs are extremely seasonal (see chart below) and extremely difficult requiring hours of back-breaking work in the 100-degree California sun.

    California Farmworkers

     

    Needless to say, America’s snowflakes have no interest in such “back-breaking” work and so California farmers have grown reliant on migrant labor from Mexico to grow and harvest their crops.  Which is why Trump’s deportation vows have California’s farmers a bit concerned.

    As one farm labor contractor told the Associated Press, farmers are growing increasingly concerned that there won’t be enough labor for the 2017 season.

    “Our workers are scared,” said Joe Garcia, a farm labor contractor who hires up to 4,000 people each year to pick grapes from Napa to Bakersfield and along the Central Coast. “If they’re concerned, we’re concerned.”

     

    Since Election Day, Garcia’s crews throughout the state have been asking what will happen to them when Trump takes office. Farmers also are calling to see if they’ll need to pay more to attract people to prune the vines, he said.

     

    Garcia tells farmers not to panic. They’ll learn how many return from Mexico after the holidays. “We’ll plan around what we have,” he tells them. “That’s all we can do.”

    But some farmers are planning for the worst and investing additional capital now to make their operations more labor efficient.  Fresno farmer Kevin Herman said he’s heard too many stories of workers that don’t plan to return from their holiday trips to Mexico for the 2017 ag season.

    Days after Donald Trump won the White House vowing to deport millions of people in the country illegally and fortify the Mexican border, California farmer Kevin Herman ordered nearly $600,000 in new equipment, cutting the number of workers he’ll need starting with the next harvest.

     

    Herman, who grows figs, persimmons and almonds in the nation’s most productive farming state, said Trump’s comments pushed him to make the purchase, larger than he would have otherwise.

     

    Plus, Herman said, he’s heard too many workers question whether they’ll return from their holiday trips to Mexico. “It’s stories like that that have motivated me to become efficient and upgrade my equipment,” Herman said.

     

    “No doubt about it,” Herman said. “I probably wouldn’t have spent as much or bought as much machinery as I did.”

    Of course, there is a clearing labor price for America’s snowflakes to take these jobs provided Americans are willing to pay double for their tomatoes and carrots.  That said, we suspect moving production to Mexico and importing food to U.S. supermarkets, even with Trump’s 35% tariff, is the more economical solution.

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