- Are Russia And China Right On North Korea?
Authored by Matthew Jamison via The Strategic Culture Foundation,
With the nuclear standoff between North Korea and the United States having heated up significantly over the summer, it has been the Governments of Russia and China who have sought to be the responsible, mature and wise international parties at the United Nations and throughout the international community.
It has been the brilliant diplomacy of Moscow and Beijing who have been the voices urging restraint, calm and dialogue unlike the insane, ridiculous and totally counter-productive rhetoric of the American President Donald Trump and the US Ambassador to the UN Nikki Haley.
The leaders of Russia and China must be given a strong round of applause for trying to avert a nuclear holocaust on the Korean peninsula whilst upholding international law, attempting to avoid a nuclear war and advocating for multi-party dialogue with the resumption of the 6 Party Talks {which have been in abeyance since 2009} and a cooling off period on the Korean peninsula with the suspension of the US-South Korea military exercises. This is the right policy going forward for the welfare, safety and security of the Korean peninsula as well as regional and international peace and stability. The wrong course of action and the wrong policies of handling North Korea and the Kim Jong Un regime have been consistently followed by the Trump administration and its allies on the UN Security Council.
The American policy of constantly aggravating North Korea with US-South Korea joint military exercises designed to unsettle, disturb and provoke the North is counter-productive and has only increased tensions and the possibility of all out war in Korea which would be a complete disaster and must not be allowed to happen. The American policy of deploying THAAD has also been like a red rag to a bull in North Korea and again only adds to increasing tensions ans the likelihood of armed conflict. While Russia and China have been working with great effort to calm the situation down with the restoration of dialogue, cooperation and stability it has been unfortunately the Governments of the United States and to a certain degree President Trump's ally in British "prime" minister Theresa May who have actually in reality been increasing tensions, escalating the situation, antagonising the North Koreans and not helping to decrease tensions and deescalate the situation.
To be clear North Korea is also completely in the wrong and it is the prime actor that must stop its nuclear tests and enter into talks. Yet it is very difficult for the North to enter into the 6 Party Talks when the United States will not countenance such talks. One could also mount an argument that the only reason the North Korean regime is behaving this way and seeking nuclear weapons is to preserve its own security as it in all likelihood feels extremely threatened especially in light of what happened with regards to Iraq during 2002-2003 and beyond and Libya after 2003.
The rhetoric of the Trump administration whether it be from the President himself or his Defence Secretary Mattis or UN Ambassador Haley has not been helpful and has been full of hyperbole, no doubt sabre rattling, but still it simply inflames and escalates an already difficult, tense and fragile international and regional security and humanitarian headache.
Imagine if the situation where reversed and it was Mexico on the United States' southern border acting in this way. Do you really think the American Government would want to deal with the fall out on its own door step of a nuclear obliterated Mexico and the tremendous ecological, environmental and human damage that would create. I doubt it very much that the United States would take the same approach to such a situation if the rogue party playing up was right on its own southern border.
With regards to the role that the United Kingdom Government is playing, hopefully, it is a constructive role with the aim to help reduce tensions and deescalate the nuclear crisis on the Korean Peninsula not increase and exacerbate what is already a very delicate situation. Time alone will tell if the current British "prime" minister Theresa May is fully committed to such a course and is actually exerting (what little influence and leverage) she may have over her new found best friend from January President Trump. Mrs. May made great hay out of her early visit to hold hands with Donald Trump a week after he was sworn in. Let the international community see now the Anglo-American "special relationship" in action with the UK prime minister persuading the American President to change tack.
- 24% Of American Men Would Have Sex With A Robot
Sex machine is going to take on a whole new meaning in years to come.
As Statista's Niall McCarthy notes, once the realm of science fiction fantasies, the technology behind anthropomorphic sex robots is advancing at a rapid pace.
Some observers believe the technology will become widespread in the near future and that sex with robots could even eclipse human love-making by 2050. It is highly controversial, however, with many feeling that the development of sex robots cannot be morally justified.
That begs the question: would you have sex with a robot? YouGov conducted a survey in an attempt to find out how Americans feel about the possibility of having a wild night with an actual sex machine. They found that while the vast majority of U.S. adults would turn down the chance of having sex with a robot, men are more likely to accept the offer than women.
You will find more statistics at Statista
1 in 4 men say they would consider having sex with a robot compared to just 1 in 10 women.
The research also shed some light on the moral consequences of having a mechanical fling. 32 percent of people would consider it cheating if their partner had sex with a robot while 33 percent would not. Interestingly, men are less likely to consider it cheating than women.
- US Boosts Defense Spending – To What End?
Authored by J.Hawk, Daniel Deiss, & Edwin Watson via SouthFront.org,
One of Donald Trump’s campaign promises was the pledge to “rebuild the US military”, and it is one of the few of his initiatives that appears to enjoy broad bipartisan support.
The US Senate’s version of the defense appropriations bill provides for what amounts to a dramatic 10% increase in defense spending, or more than even the Trump Administration requested. The bill passed with a strong bipartisan majority and with hardly any debate. There is no reason to expect the House of Representatives will not follow suit.
This naturally raises the question: what is behind the sudden interest in boosting US defense spending, after a decade and a half of continuous war?
The official reason for the boost, and one that has some merit, is the sorry state of the US military. The wars in Afghanistan and Iraq, plus the various and sundry other operations against Libya, Syria, Yemen, Somalia, not to mention the confrontations with Russia, China, and North Korea, have left the US military stretched thin and demoralized.
Much of the Army and Marine equipment pool has incurred significant wear and tear from operating in the hot and dusty Middle East conditions. The air force has been reduced to a collection of on-call bomb trucks supporting land operations. Even the navy, easily the least-engaged of the three services, has had to station carrier battle groups to contribute their airwings to the ground support mission, and thus justify the existence of the costly carrier fleet. The result is a force with significant morale and training problems which manifest themselves in crashing planes and colliding warships.
It is doubtful, however, that Congress is so eagerly “supporting the troops” for the reasons outlined above. As the recent US elections have demonstrated, the US economy’s softness is leading to unpredictable and uncontrollable election outcomes. Moreover, ideological opposition makes public spending extremely difficult to provide, with defense spending being the one solitary exception. The members of Congress are therefore supporting the defense appropriations bill with the expectation it will create jobs in their districts and states. Defense contractors themselves go out of their way to “educate” the legislators of the benefits associated with supporting this bill.
Donald Trump’s own motives likely aren’t all that different. While he campaigned on, for example, a “trillion-dollar investment in infrastructure,” the chances of such a program being passed by Congress are between slim and none. So offering a de-facto trillion-dollar increase in defense spending is the next best thing, as it may well translate into enough jobs in key states to ensure a margin of victory in the 2020 election.
But there is also a deeper sense to this effort, as the US establishment seems to try to re-enact the 1980s. And for a good reason. It was quite literally the last decade of America’s greatness, the last decade in which the country elected a president by a landslide–Ronald Reagan in 1984–and the last decade in which it scored a genuine, unalloyed geopolitical triumph in the form of the collapse of USSR and the emergence of the US as the sole hegemonic power. Therefore it is no surprise that US decisionmakers want to use it as a blueprint for repeating the earlier success.
Indeed, if one looks at the origins of America’s 1980s triumph, it is easy to see similarities between the current policies and US policies of 1970s and 1980s. The prescription for success looks something like this: first, end unpopular costly quagmire wars, retrench, carry out domestic reforms liberalizing the economy, run up national debt through massive deficit spending, pump hundreds of billions of dollars of new spending into a revitalized all-volunteer force benefiting from a technological leap forward, and watch the geopolitical benefits practically reap themselves!
But it’s unlikely this feat can be repeated.
There is no next generation of US weapons comparable to the Abrams and Bradley armored vehicles, F-15 and F-16 fighters, or AEGIS destroyers that would provide the US with the sort of qualitative advantage it enjoyed in the 1980s and 1990s. It seems highly unlikely the US will be able to extricate itself from the debilitating wars in the Middle East. Trump is no Nixon, he lacks the foreign policy credibility sufficient to persuade the US establishment to accept at least a temporary loss of influence in the Middle East. Most importantly, while Reagan benefited from a stagflationary economy that benefited from liberalization and deregulation, and a low level of national debt, Trump has neither. US economy is suffering from neoliberalism and globalization taken to their logical extremes, not over-regulation or over-taxation. The US national debt is reaching its historic maximums. And, last but not least, China today is an economic powerhouse while Russia’s economy is on a far more sound footing than the Soviet economy was in the 1970s and 1980s.
The danger here is that, aware that the time is not on their side, the US elites may engage in more international adventurism to a far greater extent than Reagan did in Grenada and Lebanon.
Unfortunately, there are few indications the US elites have accommodated themselves to the new, post-hegemonic, international balance of power, and the boost in military spending is a reflection of their efforts to recapture past glories. But it is unlikely they can reverse the process of US hegemonic decline. Indeed, this effort actually represents a still-heavier burden on the already weak US economy.
- Unsealed CIA Memos Provide Shocking 'Salt Pit' Black Site Details
A new batch of 274 CIA documents connected with Bush era torture have just been made public as a result of a lawsuit brought by families of victims. Contained in the documents are newly unearthed details on the CIA’s “black site” program which reached its peak under Bush’s ‘war on terror’ as well as shocking details revealing how the agency integrated its contract psychologists into its ‘enhanced interrogation’ program in order to give torture a veneer of legality. While much of this story of CIA torture has already slowly come to light over the past few years, especially with the 2014 Senate Intelligence Committee report, the just released documents capture internal high level agency discussions revealing a cover-up in action.
Many of the memos focus on the CIA’s infamous ‘Cobalt’ site in Afghanistan (also code named The Salt Pit), routinely described in headlines as the “sadistic dungeon” and “dark prison” for its full sensory deprivation darkness which detainees experienced round the clock, sometimes for years, as well as the two psychologists credited with designing the program of brutal interrogation techniques: John “Bruce” Jessen and James Mitchell.
Two surviving prisoners and the family of a detainee who died at the Colbalt site reached an out-of-court settlement with the CIA psychologists in August after a lawsuit was brought for their role in the torture. As was hoped, the CIA and Pentagon were forced to declassify the documents related to the case in pretrial discovery.
Satellite image of Cobalt site, also called the Salt Pitt, from now public documents.The documents show the psychologists had been directly involved in designing and implementing torture, and that the blurring of lines between CIA interrogators and the psychologists originally brought in for “research” and development of techniques had agency leadership worried over future legal ramifications. Jessen himself had spent 10 days at the Cobalt facility in November 2002 where he was involved in interrogating Gul Rahman – a suspected militant who died of hypothermia while chained naked from the waist down to a concrete floor. He died 5 days after Jessen left.
Ironically, a key fact rarely highlighted is that Gul Rahman was captured among Gulbuddin Hekmatyar’s Hezb-i-Islami faction, which itself had previously been funded and vastly expanded by the CIA as part of Operation Cyclone. By 2010 terror leader Hekmatyar himself would enter negotiations with then President Karzai, and by 2017 would be fully reconciled with the US-backed government in Kabul.
Dr. Bruce Jessen, left, and Dr. James Mitchell, psychologists who contracted with the C.I.A.The Guardian summarizes the newly released “Chronology of Significant Events” court findings covering the specific time period of Rahman’s slow death at the Salt Pit as follows:
- November 2002: Rahman wearing only socks and diaper; supervisor has concern regarding hypothermia
- Rahman subjected to 48 hours of sleep deprivation, rough treatment, cold shower and other measures but remained noncompliant.
- Subjected to cold conditions and minimum food and sleep… confused due to dehydration and fatigue.
- Cable recommends future use of continued environmental deprivations with interrogations 18 out of 24 hours daily
- Linguist asks questions about the temperature at which hypothermia occurs
- November 19 2200 hrs guard check – Rahman is alive.
- 2300 hrs guard check – Rahman is alive.
- November 20 0400 hrs guard check – Rahman is alive.
- 0800 hrs guard check – Rahman is alive.
- 1000 hrs guard check – Rahman is dead.
The Guardian further describes the now declassified documents as providing “the fullest picture yet of what the three men suffered [associated with the lawsuit] in that secret CIA dungeon – and of how fatefully their lives intersected with the rise and fall of James Mitchell and Bruce Jessen, the men who designed the torture regime.”
Highlighted below are some revealing sections from the newly released batch of CIA torture memos – some of the below were already available before the latest release:
CIA contracted psychologists created an “Exploitation Draft Plan” which involved holding captives in soundproof cells in hidden facilities that were beyond the reach of the Red Cross, the press, and even internal US government oversight. The plan notes: No International Red Cross [IRC] nor even US observers. Detainees were essentially “disappeared” individuals and not even family members knowing their fates. Rahman’s family didn’t know of his whereabouts or death for seven years until an AP report unearthed his name. As noted in the below memo, Pentagon involvement ended with capture and transfer as a DoD psychologist accompanied the captive “unbeknown to the subject” after which the CIA psychologists would be involved in interrogation.
Particularly intense “interrogation” sessions involved medical personnel attending to detainee wounds, and even applying antibiotics, so that torture could continue: “The straps were removed: subjects breathing continued to be rapid. Subject was then instructed to off the [water] board under his own power, which he did. The interrogators pointed to the small box and said, ‘you know what to do.’… At 1130 hours, taken out of small box, hooded, and made to stand against a cell wall: at 1230 hrs, back into the large box (unhooded)–note that medical officers dressed as security team member at this time gave subject Betadine to clean wound. Subject was also given a topical antibiotic to apply to the leg wound… At 1450 hrs, back to large box. At 1601 hrs into small box: 1612 hrs, subject was heard crying/wimpering/chanting, 1635 went from small box to floor, sitting down hooded; and 1655 hrs, returned to large box, unhooded…”
CIA leadership envisioned that psychologists Jessen and Mitchel would provide a legally “defensible” veneer to torture sessions (after being paid $81 million). So long as their personal assessments vouched for detainees being of mentally sound mind, “enhanced interrogations” could be initiated. “In my read of the DOJ memo, providing we abide by our water board process on [redacted] (qualified medical staff present, the defensible exam is done and we follow our procedures) I believe the water board can be approved by CTC/LGL [CIA’s internal legal review team] without the need for further input from DOJ.” Jessen and Mitchel were paid $81 million by the CIA in the process.
CIA leadership suggested psych evals be done from afar based on mere review of a file in order to set up a minimally invasive rubber stamp process. “to get waterboard approvals, we need a psychological evaluation… [Name redacted] indicated that we need to make a ‘defensible’ psychological analysis indicating that, given the individual’s particular mental disposition, he would not suffer prolonged and sever psychological problems resulting from the enhanced interrogation techniques… can OTS make a defensible analysis based on a file review on the targets? Or do they need to have a psych eval done on the ground, face-to-face? [Name redacted] indicates that all it must [be] is ‘defensible.'”
Doctors and nurses were requested to be present during sessions. One email with the subject line “Medical coverage planning” asked “There would be nurses on site correct?” This was presumably to allow torture to continue after detainees were injured, wounded, or sick – while also preventing those running the program from being legally exposed to prosecution.
Internal admissions of “blatant disregard for ethics”: CIA contracted psychologists’ ethics were questioned even by colleagues. They “have both shown blatant disregard for the ethics shared by almost all of their colleagues.” Other emails admitted: “No professional in the field would credit their later judgments as psychologists assessing the subjects of their enhanced measures.” And also, “if some untoward outcome is later to be explained, their sole use in this role will be indefensible.”
- Minsky, Myopia, & Why The S&P 500 Is A Bloated Corpse
Authored by Raul Ilargi Meijer via The Automatic Earth blog,
According to Hyman Minsky, economic stability is not only inevitably followed by instability, it inevitably creates it. Complacent humans being what they are. If he’s right, and would anyone dare doubt it, we’re in for that mushroom cloud on the financial horizon. We know that because market volatility, as measured for instance by the VIX, the Chicago Board Options Exchange (CBOE)’s volatility index, is scraping the depths of the Mariana trench.
Two separate articles at Zero Hedge this weekend, one by NorthmanTrader.com and one by LPLResearch.com, address the issue: it is time to be afraid and wake up. And that is not just true for investors or traders, it’s true for ‘everyone out there’ perhaps even more. Central bank policies, QE and ultra low rates, have distorted the financial system to such an extent -ostensibly in an attempt to save it- that the depressed, compressed volatility these policies have created can only come back to life with a vengeance.
Feel free to picture zombies and/or loss of heartbeat as much as you want; it’s all true. Financial markets haven’t been functioning for years, and there have been no investors either, only gamblers and profiteers, as savers and pensioners have been drawn and quartered. Central bankers have eradicated price discovery, nobody knows what anything is really worth anymore, be it stocks, bonds, housing, gold, bitcoin, you name it.
If you make interest rates ‘magically’ disappear anyone can spend any amount of money on anything they fancy buying. And it’s not just traders and investors either. Scores of people think: look, I can buy a house, others think they can buy a bigger house, many will get into stocks and/or bonds, because prices just keep going up. Even savers and pensioners are drawn into the central bank Ponzi, often in an effort to make up for what they lose when their accumulated wealth no longer pays them any returns. Shoeshine boys are dishing out market tips.
Crypto may or may not be a new tulip, but many Silicon Valley start-ups -increasingly funded by crypto ICO’s- certainly are. There’s so much money sloshing around nobody can tell, or even cares, whether they are actually worth a penny. It’s all based on gossip multiplied by the idea that they will be smart enough to get out in time in case things go awry.
People mistakenly think that a market’s heartbeat can be found in for instance rising stock prices, the Dow, the S&P. But that’s simply not true. The S&P is a bloated corpse increasingly filling up with gases that will eventually cause it to explode, with guts and blood and body parts and fluids flying all around.
The US stock market’s heartbeat manifests itself in volatility, and the overall economy’s heartbeat in interest rates. Rising and falling volatility and interest rates is how we know whether a market is in good health, or even alive at all. They are its vital signs.
That follows straight from Minsky. Ultra-low rates and ultra-low volatility, especially if they last for a longer period of time, are signs of trouble. The markets the central banks’ $20+ trillion QE and ZIRP have created are bloated corpses that no longer have a heartbeat. They are zombies. But markets, unlike natural bodies, won’t die, they can’t. They will instead rise from their graves and take over Wall Street, the City, and then everyone else’s street.
Bernanke, Yellen, Draghi and Kuroda are sorcerer’s apprentices and Dr. Frankensteins, who have created walking dead monsters they have no control over. But the monsters won’t turn on them personally; that’s the tragedy here as much as it is the reason why they have worked their sorcery. They themselves won’t go bankrupt, other will. No skin in the game.
Enough with the metaphors. First, here’s NorthmanTrader:
In the movie Flatliners aspiring medical doctors tried to unlock the mysteries of death by, well, killing themselves. It was meant to be a controlled death of course, to flat line on the heart rate monitor for a few minutes to find out what wonders where to be found “on the other side” only to then return safe & sound thanks to medical intervention. Well, they soon found out the other side wasn’t everything it was cracked up to be and the main character soon got regular beatings as the sins of his past came back to haunt him.
In my view markets find themselves in a very similar script. The promise of investor nirvana where the pains of real life no longer matter. If you only pay attention to the record highs headlines it all looks rather fantastical these days. [..] any trader staring at the tape knows that we find ourselves in the most compressed price environment in history. This is not normal, there’s no heartbeat:
As I’m writing this I’m fully aware I may be viewed as the bear who cried wolf. After all I’ve been outlining structural risk factors for a while and markets have moved past my technical risk zones of 2450-2500 and most recently 2530. That’s what bubbles do. They blow past anyone’s expectations, they make believers of the unbelievers, make bears look like idiots and the most reckless look like geniuses. But an extreme market that only becomes more extreme is not any less extreme, it is just more extreme. As no risk is apparent these extremes are then dismissed as the new normal. Yet momentum driven price appreciation has absolutely zero predictive value of future price appreciation, it only appears as such at the time.
We find ourselves in a very unique point in history and in a world dominated by false narratives. It is a challenge to keep an analytical grip on reality, but I’ll try to tie a few threads together here to put everything in a macro context. Firstly the underlying base reality: Free money, easy money, whatever you want to call it, permeates everything we see in financial markets. Indeed I would argue price appreciation has been paid for with unprecedented and, in my view, unsustainable volatility compression. A couple of charts really highlight this. Most clearly perhaps is the precise trend line tagging we can observe in the correlated picture of price appreciation and volatility compression since the February 2016 lows:
The $VIX’s corollary, the inverse $XIV, embarked on an explosive near one way journey since the US election coinciding with over $2 trillion central bank intervention in just the first 9 months of 2017:
And it has continued to this day and just made another all time high this past week on a massive negative divergence. It is the magnitude of this volatility compression that explains the current trading environment we find ourselves in.
[..] Debt expansion at low rates continues to sustain the illusion of real prosperity for the 90%:
And then LPLResearch with another indicator that goes to show we’re dealing with a zombie here: stock prices are not moving, either up or down. Or rather, they’re moving up all the time, but in too small increments. Yeah, like that bloated corpse.
Where Did All the Big Moves Go?
There have only been eight moves of at least 1% for the S&P 500 Index so far this year—the least since 13 in 1995. The all-time record was an incredible three in 1963. What about a big move? The last time the S&P 500 moved at least 4% was nearly six years ago. In fact, the S&P 500 had four consecutive days with 4% (or greater) changes in August 2011. Other than 2008 and the crash of ’87, that is the only other time since the Great Depression to see four consecutive 4% changes. That isn’t anything like today’s action.
As the chart below shows, so far in 2017, big moves have been nonexistent; and even 1% changes have been rare. Per Ryan Detrick, Senior Market Strategist, “If you had forecast that the 11 months after the 2016 U.S. presidential election would be one of the least volatile periods ever, you would be in the minority. Then again, the last time we saw a streak of calm like this was the year after John F. Kennedy was assassinated in November 1963. Once again proving that the market rarely does what the masses expect and usually surprises us.”
You want a heartbeat. That tells you if a body or a market is alive, healthy, functioning. We don’t have one. We haven’t for years. But we will again.
Natural bodies can tend towards equilibrium, i.e. death. Markets cannot. They’re doomed to flatline, and then to always come back from near death experiences. They tend to do so in violent ways though. When volatility at last returns, so will price discovery. It won’t be pretty.
- "The Prices Are Insane": You Know It's Bad When Used Private Jet Prices Are Crashing
America’s wealthiest have never been richer, thanks to 9 years of Federal Reserve “wealth creation” which has favored the top 1%, leading to an imbalance in wealth accumulation that has resulted in a record split between the haves and have nots. In fact, as the Fed admitted two weeks ago, the top 1% of Americans are 70% wealthier than the bottom 90%. But even though the number of millionaires and billionaires living in the US is at an all time high, and is on track to increase by nearly 700,000 a year between now and 2021 – assuming the market does not for the next 4 years – an influx of new potential buyers has done little to alleviate a supply glut that has been weighing on used jet prices for years.
As Bloomberg reports, sales prices for used private jets have fallen as much as 16% over the past year – and more than 35% over the past 3 years – with the average price falling from $13.7 million in April 2014 to $8.9 million as of this summer, according to research by Colibri Aircraft, which specializes in the marketing, resale and purchase of pre-owned private aircraft. And, as a glut of planes came on to the market in the wake of the economic downturn, owners have lost millions on the value of their existing business jets. The resale price of a Bombardier Global XRS, which sold for $50m, has dropped from $31.3m to $20.4m — down just under 35%.
While most major manufacturers, including Gulfstream and Bombardier have modestly pared production in the last couple of years as demand for private jets slumped, it has been nowhere near enough to shrink supply in line with the collapse in demand, and as a result it has not been enough to halt declines in aircraft values, say consultants for the $18 billion industry quoted by Bloomberg.
And with bargains aplenty on machines with few flight hours, including various new timeshare startups which have made it even more economical to rent than to own, manufacturers are slashing prices and cutting deals to entice buyers to purchase new planes. Meanwhile, they keep churning out aircraft and introducing new models.
It is this excess production glut that has sent prices tumbling by double-digits. “It’s a question of who wants to blink first,” Rolland Vincent, a consultant who puts together the JetNet iQ industry forecast, told Bloomberg. “Nobody – because whoever blinks, loses share.”
In the latest, just released long-term outlook on the state of the Business Jet Aviation, Honeywell forecast up to 8,300 new business jet deliveries worth $249 billion from 2017 to 2027, down 2-3% points from the most recent 10-year forecast released one year ago.
And unfortunately for makers of private jets, a rebound in demand for new company planes, which would help stabilize the market, isn’t in the cards. Corporate plane-buying plans have hit a 17-year low, according to an annual survey by Honeywell International Inc. of more than 1,500 flight departments. Companies expect to replace or add planes equivalent to 19 percent of their fleets on average over the next five years, down from 27 percent in last year’s survey.
“Declining used aircraft prices, continued low commodities prices, and economic and political uncertainties in many business jet markets remain as near-term concerns for new jet purchases, leading to a modest growth in 2018,” said Ben Driggs, president, Americas Aftermarket, Honeywell Aerospace. Driggs noted that the declined was most significant in Chinese and Russian purchase plans; Brazil remains a bright spot by recording strongest new aircraft purchase plans in survey from a major aircraft market though overall buying plans also declined year over year.
Meanwhile, all those “aspirational” buyers who hoped to impress someone with their full-priced toy purchase, are seething said Barry Justice, founder and chief executive officer of Corporate Aviation Analysis & Planning Inc.
And so, to stimulate some demand, Gulfstream slashed as much as 35% off the price of its G450, which is being phased out as the new G500 aircraft nears arrival, Vincent said. The G450 had a list price of about $43 million, according to the Business & Commercial Aviation guide.
Others are similarly liquidating: Bombardier has offered discounts of as much as $7 million on the Challenger 350’s list price of about $26 million as it fends off competitors entering the super midsize space, he said. The weakness across the industry in private-jet sales is adding to the pressure on Bombardier, which is also struggling to sell its C Series commercial planes. The U.S. government slapped import duties of about 300% on the single-aisle jetliner in the last two weeks after a complaint by Boeing.
But what is most surprising is that the corporate aircraft segment – the one catering exclusively to the world’s richest, i.e. those who have explicitly benefited from central bank policies in the past decade, the global market hasn’t fully recovered from the last U.S. recession, when plunging demand popped a bubble that had flooded the industry with more than 1,000 new jet deliveries in both 2007 and 2008. A nascent recovery in 2013 and 2014 fell apart after the price of oil and other commodities collapsed, drying up sales in emerging markets such as Russia and Brazil.
Deliveries of new private jets are forecast to drop to 630 this year, from 657 last year and 689 in 2015, according to JPMorgan Chase & Co. The number is forecast to rebound slightly to 640 next year.
According to Bloomberg, the more conservative pace has done little to relieve the glut, creating a buyer’s market for used aircraft. A five-year-old jet sold in 2016 was worth only 56% of its original list price, on average. That’s down from 64% in 2012, according to a report by plane broker Jetcraft. The value retention was as high as 91 percent in 2008.
Prices for used aircraft right now are “insane,” said Justice. And yet, prices are only going to get even more insane.
“There’s a vast overproduction of large-cabin airplanes and there are only so many people in the world who are going to step up and pay $60 million-plus,” he said. “What happens is, people are going to that pre-owned market.”
Of couse, none of this should be a surprise, as the collapse of the private-jet bubble isn’t a new phenomenon, though the markdowns that some owners face are probably even larger than what Bloomberg is reporting: Back in 2015, we reported that Delta purchased a used Boeing 777 for just $7.7 million, equivalent to a 97.2% discount off its list price of $277.3 million.
Delta CEO Richard Anderson raised eyebrows, and caused smirks among industry “experts”, that October when he said there was a “huge bubble” in used widebody aircraft, pricing a 10-year-old 777-200 at $10 million. Anderson said that the market would be “ripe” for Delta to buy used 777s. To be sure, Boeing CEO Dennis Muilenburg was among those who pushed back against Anderson, saying the Delta CEO was valuing used 777’s much too low. Turns out, Anderson’s estimate was $2.3 million too high.
To be sure, the supply of new jets has fallen sharply in the past decade. In 2008, 1,313 business jets were delivered, compared with 661 in 2016, and less expected this year. But the drop hasn’t been fast enough to balance out oversupply in the used-jet market.
The silver lining is that the chartered private plane industry stands to benefit as more owners give their planes up for charter. The rise in available planes hasn’t had much of an impact on the price of a charter hour, which has changed little in the last decade. “It has been exactly the same price to charter a private jet for the past 10 years,” said Adam Twidell, chief executive of PrivateFly, a global booking service for private aircraft hire.
However, it is just a matter of time before the primary cost deflation spreads to the services segment and who knows: at this rate of plunging prices, it may soon be (much) cheaper to charter a seat in a private jet than to fly commercial first (or even business) class.
- Donald Trump: Warmonger-In-Chief?
Authored by Antonius Aquinas via Acting-Man.com,
Cryptic Pronouncements
If a world conflagration, God forbid, should break out during the Trump Administration, its genesis will not be too hard to discover: the thin-skinned, immature, shallow, doofus who currently resides in the Oval Office!
The commander-in-chief – a potential source of radiation?
This past week, the Donald has continued his bellicose talk with both veiled and explicit threats against purported American adversaries throughout the world. In a cryptic exchange with reporters during a dinner with military leaders, he quipped:
You guys know what this represents? Maybe it’s the calm before the storm. It could be the calm… before… the storm.*
A reporter asked if he meant Iran or Isis which the POTUS responded, “you’ll find out.” Instead of threatening supposed overseas foes with nuclear annihilation, none of whom have taken any concrete military action against the US, why not go after someone who has actually compromised the country’s security, namely Hillary Rodham Clinton!
While some dismissed the comments as typical Trumpian bluster, White House press secretary Sarah Sanders added further ominous overtones when questioned saying they were “extremely serious.” Later in the week, Trump continued to threaten tiny North Korea, this time in not so veiled terms:
“Presidents and their administrations have been talking to North Korea for 25 years, agreements made and massive amounts of money paid hasn’t worked, agreements violated before the ink was dry, making fools of U.S. negotiators. Sorry, but only one thing will work”.**
If war erupts either on the Korean Peninsula or in any other part of the globe that the U.S has wantonly poked its nose into, it can be safely assured that neither Trump nor any of the other “military leaders,” with whom he recently had dinner with will be in the midst of hostilities as the bombs and bullets are being cast about.
No, these laptop bombers will be in safe quarters far away from enemy lines, giving orders, making speeches, and praising the troops, while Congress will be hurriedly passing more “defense” funding legislation further lining the pockets of the military industrial complex.
Too far removed from the battlefield…
Curtailing the Warmongers
The Warmonger-in-Chief, who has repeatedly bragged about America’s military prowess, had a chance to become a part of the organization he constantly gushes over during his youth at the time of the Vietnam War. Yet, he escaped military service, due to the machinations of his father, because of a mysterious foot/toe malady.
All those who avoided being conscripted into America’s disastrous imperial exercise in Southeast Asia during those years, whether it was from phony medical conditions, escaping to Canada or beyond, or going to jail, they did so for justifiable reasons.
The war was immoral, since Vietnam had taken no hostile action against the US and what made it worse, the government drafted thousands of America’s youth to fight it. It is reprehensible that those who got out of military service then are now at the forefront in advocating mass murder (war).
One resolution that would certainly curtail warmongering in the future would be that any legislator, president, cabinet officer, or ambassador who promotes military intervention abroad should be required to directly participate in field operations. This would quickly put the brakes on threatening talk from the likes of Trump and his crazed UN Ambassador, Nikki Haley.
A country’s leadership personally conducting military operations has a long tradition in Western history. During the era of the crusades, princes and kings led their retinues and forces into battle risking their own life and limb – such as the great Norman prince, Bohemond, whose courage, tenacity, and military acumen won the day for Christian forces at the battle of Antioch.
From left to right: Bohemond I of Antioch, Bohemond’s troops scaling the ramparts of Antioch in AD 1098, Bohemond’s mausoleum in Canosa di Puglia. Bohemond was the son of Rober Guiscard, the count of Apulia and Calabria. His real name was Mark Guiscard. He was a nicknamed Bohemond after a legendary giant – the name was given to him because he was an unusually tall and strong man, dwarfing those around him. Even for a crusader, Bohemond’s life was unusually colorful. [PT]
This venerable ideal can still be seen in Russia when recently one of its generals and two colonels lost their lives in the Syrian quagmire.*** When was the last time a US general has perished in active combat?
It is apparent that the current POTUS does not understand the catastrophic consequences of what his threats, if carried out, would lead to – death to millions, unimaginable destruction, and the end of civilization.
A brief history of US-North Korean relations in the 2000ds
Maybe, had he actually suffered through the horrors of combat or had been the victim of US aggression as the peoples of North Korea, Vietnam and Iraq have witnessed, he might refrain from such bellicose language.
Hopefully, cooler heads in the Administration will prevail, however, a more peaceful world is unlikely with the likes of Donald J. Trump at the command of the greatest destructive force in human history.
References:
*Tyler Durden, “President Trump Warns Ominously: ‘It’s the Calm Before the Storm.’” Zero Hedge. 6 October 2017.
**Tyler Durden, “Trump Hints at War With North Korea: ‘Sorry, But Only One Thing Will Work.’” Zerohedge, 7 October 2017.
- Vegas Massacre Story Changes: Gunman Shot Security Guard Before Opening Fire On Crowd
In a dramatic shift to the original Las Vegas shooting narrative, over a week after Stephen Paddock rained down bullets on a crowd and killed 58 people, late on Monday Clark County Sheriff Joe Lombardo drastically changed the timeline of the deadliest mass shooting in modern U.S. history, and now the gunman allegedly opened fire on a security guard six minutes before he unleashed the massacre. Officials had previously claimed that Paddock, 64, shot Mandalay Bay security guard Jesus Campos only after Paddock had started shooting at the Route 91 Harvest country-music festival from his 32nd-floor hotel suite on Oct. 1.
The revision to the story also undermines the story surrounding the end of the shooting: officials had previously credited Campos, who was shot in the leg, with stopping the 10-minute assault by turning the gunman’s attention to the hotel hallway, where Campos was checking an alert for an open door in another guest’s room. However, with the revelation that Campos was shot before his mass shooting, officials now admit they don’t know why he stopped his attack.
Las Vegas Metro PD: Suspect shot security guard before shooting at crowd https://t.co/befniwHBH8 https://t.co/GHSxEOfAtZ
— NBC News (@NBCNews) October 9, 2017
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As part of the new “story”, officials said that police officers who rushed to the hotel room when the shooting began didn’t know a hotel security guard had been shot “until they met him in the hallway after exiting the elevator,” Lombardo said.
The security guard, Jesus Campos, was struck in the leg as the gunman, from behind his door, shot into the hallway on the 32nd floor. Paddock apparently detected Campos via surveillance cameras he set up outside his hotel suite, police have said.
Paddock shot the guard at 9:59 p.m. local time, Lombardo said, shortly before raining down bullets on the Route 91 Harvest festival in an attack that began at 10:05 p.m. and lasted 10 minutes. Police officers found Campos when they arrived on the floor.
And since it is not Campos who summoned the police, it is once again unclear what event catalyze the end of the mass shooting.
Lombardo also disclosed that Paddock was seen on numerous occasions in Las Vegas without any person accompanying him and he gambled the night before the shooting. “This individual purposely hid his actions leading up to this event, and it is difficult for us to find the answers,” said Lombardo, who said he was frustrated with the speed of the investigation.
“In coordination with the FBI’s behavioral analysis unit, a comprehensive picture is being drawn as to the suspect’s mental state and currently we do not believe there is one particular event in the suspect’s life for us to key on,” Lombardo said.
Meanwhile, Sheriff Lombardo refuted something he himself insinuated last week, when he said that there is no indication anyone other than Paddock fired on the crowd: “We have uncovered no evidence to show there was a second shooter.”
“We have uncovered no evidence to show there was a second shooter,” Sheriff Joe Lombardo says of Las Vegas massacre https://t.co/Okz2bwUl4f pic.twitter.com/bNLOdsgyn3
— CBS News (@CBSNews) October 9, 2017
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Now, as part of the new narrative, Lombardo said it was unclear why Paddock stopped firing at the crowd, suggesting he may have initially planned to escape. As we reported last week, Paddock also shot at jet fuel tanks at McCarran International Airport and had protective gear in the hotel suite and explosives in his parked car.
- South Korea's New "Blackout Bomb" Can Paralyze The North's Power Grid
US and South Korean officials are nervously watching to see if North Korea follows through with its threats to carry out another nuclear test – or to fire a rumored long-range missile capable of accurately striking the west coast of the US into the Pacific – in celebration of the Oct. 10 anniversary of the Communist Party’s creation. Meanwhile, the Telegraph reports that South Korea has developed a new weapon to hobble the North’s infrastructure should an armed conflict erupt on the peninsula. Given that it's almost daybreak in North Korea, such a test could happen as soon as Monday night, Eastern Time.
The weapon is a graphite bomb – otherwise known as a “blackout bomb” – which South Korean officials say will be capable of shutting down North Korea’s entire power grid. Blackout bombs were first used by the US in Iraq in the 1990 Gulf War and work by releasing a cloud of extremely fine, chemically treated carbon filaments over electrical components. The filaments are so fine that they act like a cloud, but cause short circuits in electrical equipment.
As News.com.au points out, North Korea tends to celebrate the Oct. 10 holiday with military parades and aggressive rhetoric. But this year's festivities could include new provocative weapons tests.
“The Kim regime usually uses these sorts of occasions to demonstrate some show of strength — in this current climate a missile test is a likely result,” says Dr Genevieve Hohnen, lecturer in politics and international relations at Edith Cowan University.
The Telegraph reports that the South developed the bomb to minimize civilian casualties in the North should a conflict erupt. In a statement to Yonhap, a military official said the South Korean army could assemble a blackout bomb at any time. The weapon was reportedly developed by South Korea's Agency for Defense Development.
“All technologies for the development of a graphite bomb led by the ADD have been secured. It is in the stage where we can build the bombs anytime,” a military official told Yonhap.
The bomb is often referred to as a “soft bomb” because it only affects targeted electrical power systems.
As the Telegraph explains, the blackout bomb was developed as part of South Korea’s “three pillars” plan for retaliating against the North if it believes a nuclear strike is imminent. Escalating tensions with the North have inspired the South to move its target date for completion forward by three years. The plan was initially slated to be complete by the mid-2020s.
The first two parts of the plan involve detecting – and then intercepting – North Korea missiles. The second part – aptly named the “massive punishment and retaliation plan” involves launching attacks against the country’s leadership, including a plan to assassinate Kim Jong Un.
South Korea is bringing forward the deployment of its "three pillars" of national defence by as much as three years as a result of the growing threat posed by Pyongyang's nuclear and missile development programmes.
The three-pronged strategy was originally scheduled to be in place by the mid-2020s, but North Korea's increasingly aggressive and unpredictable behaviour has forced Seoul to revise that timeline.
The Kill Chain programme is designed to detect, identify and intercept incoming missiles in the shortest possible time and operates in conjunction with the Korea Air and Missile Defence system for lower-tier defence against inbound missiles.
The final component of the strategy is the Korea Massive Punishment & Retaliation plan, under which Seoul will launch attacks against leadership targets in North Korea if it detects signs that the regime is planning to use nuclear weapons.
South Korea believes North Korea’s energy grid is outdated and vulnerable, and thus would be incredibly susceptible to a “blackout bomb” attack. Blackout bombs were first used by the US against Iraq in the Gulf War of 1990, when they knocked out about 85 percent of Iraq’s electricity. They were also used by NATO against Serbia in 1999, when it damaged around 70 percent of the country’s electrical supply.
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President Donald Trump fired off his latest threatening tweet about North Korea earlier today, reiterating his view that 25 years of US appeasement and billions of dollars in humanitarian aid for the North clearly have not worked. He ended the tweet with yet another vague hint that the US could soon resort to a military strike.
Our country has been unsuccessfully dealing with North Korea for 25 years, giving billions of dollars & getting nothing. Policy didn't work!
— Donald J. Trump (@realDonaldTrump) October 9, 2017
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Though the US has rejected North Korea's claims that Trump's rhetoric has amounted to a declaration of war, how much longer can the US credibly claim that "all options are on the table" if North Korea continues to provoke the international community with its missile and nuclear tests?
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