May 14

Today’s News 14th May 2017

  • Paul Craig Roberts Rages "Are You Ready To Die?"

    Authored by Paul Criag Roberts,

    “Fifty years ago, the streets of Leningrad taught me one thing: If a fight is inevitable, you must strike first.” Vladimir Putin

    In George Orwell’s 1949 dystopian novel, 1984, information that no longer is consistent with Big Brother’s explanations is chucked down the Memory Hole. In the real American dystopia in which we currently live, the information is never reported at all.

    On April 26 – 16 days ago – Lt. Gen. Viktor Poznihir, Deputy Chief of the Main Operations Directorate of the Russian Armed Forces, stated at the Moscow International Security Conference that the Operations Command of the Russian General Staff has concluded that Washington is preparing a nuclear first strike on Russia.

    See:

    https://www.rt.com/news/386276-us-missile-shield-russia-strike/ 

    http://www.fort-russ.com/2017/04/us-forces-preparing-sudden-nuclear.html 

    https://www.times-gazette.com/ap%20general%20news/2016/10/12/russia-china-to-mull-joint-response-to-us-missile-shield  

    http://themillenniumreport.com/2017/04/us-forces-preparing-sudden-nuclear-strike-on-russia-moscow-security-conference/ 

    The Times-Gazett in Ashland, Ohio, was the only US print media that a Google search could turn up that reported this most alarming of all announcements. A Google search turned up no reports on US TV, and none on Canadian, Australian, European, or any other media except RT and Internet sites.

    I have been unable to find any report that any US Senator or Representative or any European, Canadian, or Australian politician has raised a voice of concern.

    No one in Washington got on the telephone to tell Putin that this was all a mistake, that the US was not preparing a nuclear first strike on Russia, or ask Putin how this serious situation could be defused.

    Americans do not even know about it, except for our readers.

    I would have expected at least that the CIA would have planted the story in the Washington Post, the New York Times, CNN, MSNBC, and NPR that General Poznihir was expressing his personal opinion, nothing to be taken seriously. But apparently Americans and their European vassals are not to even know that such an accussation was made.

    As I reported some time ago and more recently in my column about North Korea, the Chinese leadership has also concluded that the US intends a nuclear first strike against China.

    Alone either Russia or China can destroy the US. If they act together, the destruction of the US would be redundant. What is the intelligence, if any, and morality, clearly none, of the US leadership that recklessly and irresponsibly invites Russia and China to preempt Washington’s attack on them with an attack on the US?

    Surely not even insouciant Americans are so stupid as to think that Russia and China will just sit there and wait for Washington’s nuclear attack.

    I lived through every stage of the Cold War. I participated in it. Never in my life have I experienced the situation where two nuclear powers were convinced that the third was going to surprise them with a nuclear attack.

    I supported Trump because he, unlike Hillary, said he would normalize relations with Russia. Instead he has raised the tensions between the nuclear powers. Nothing is more irresponsible or dangerous.

    We currently are in the most dangerous situation of my lifetime, and there is ZERO AWARENESS AND NO DISCUSSION!

    How can this be? Putin has been issuing warnings for years. He has told the Western presstitute media on more than one occasion that they, in their dishonesty, are pushing the world to nuclear war. Putin has said over and over, “I issue warnings and no one hears.” “How do I get through to you?”

    Maybe the morons will hear when mushroom clouds appear over Washington and New York, and Europe ceases to exist, as it will if Europe continues the confrontation with Russia as is required from Washington’s well-paid vassals.

    Within the last several years I reported the Chinese government’s reaction to US war plans for a nuclear strike on China. The Chinese showed how their submarines would destroy the West Coast of the US and their ICBMs would finish off the rest of the country.

    I reported all of this, and it produced no response. The Memory Hole wasn’t needed, as neither Washington nor the presstitutes nor the Internet noticed. This is insouciance to the thousandth degree.

    In America and its subservient, crawling on their knees vassal states, the information never gets reported, so it never has to be put down the Memory Hole.

    If you convince someone that you are going to kill them, they are going to kill you first. A government, such as what exists in Washington, that convinces powerful countries that they are targeted, is a government that has no respect whatsoever for the lives of its own people or the peoples of the world or for any life on planet Earth.

    Such a government as Washington is evil beyond all measure, as are the media whores and European, Canadian, Australian, and Japanese vassal states that serve Washington at the expense of their own citizens.

    Despite all their efforts to believe otherwise, the Russian and Chinese leaderships have finally arrived, belatedly, at the realization that Washington is evil to the core and is the agent of Satan.

    For Russia and China, the Satanic Evil that rules in the West has reduced the choice for Russia and China to them or us.

  • Which US Region Contributes The Most To GDP?

    The U.S. Bureau of Economic Analysis (BEA) has published gross domestic product (GDP) figures for the fourth quarter of 2016 by state. According to the BEA data released on Thursday, real GDP increased in every state and the District of Columbia for that time period.

    GDP by state growth ranged from 3.4 percent in Texas to 0.1 percent in Kansas and Mississippi. Finance and insurance; retail trade; and professional, scientific, and technical services were the leading contributors to U.S. economic growth in the fourth quarter.

    Overall, growth was pretty even when states are combined to regions. The GDP share of those regions didn’t change much, comparing year-over-year fourth quarter figures.

    Infographic: United States Gross Domestic Product by Region 2016 | Statista

    You will find more statistics at Statista

    As shown in the Statista chart above, the GDP has a strong correlation with how many people live in those areas. It doesn’t come as much of a surprise that the Southeast, which has the combined population of 12 states, amounting to approximately 83 million (or a quarter of U.S. citizens), also has the biggest GDP share, standing at 21.4 percent of total GDP. The thinly populated Rocky Mountain area (12 million inhabitants) has a share of 3.4 percent of the GDP.

  • A California Business Banker Speaks Out: "It's A Classic Late-Cycle Red Flag"

    Authored by Mike Shedlock via MishTalk.com,

    On occasion, I get emails from a commercial banker friend who lives in California. Today he provides anecdotes from a business banker’s perspective.chair
     

    Hey Mish

     

    It’s been a while since my last email. Here are some views from this business banker’s chair.

     

    I had lunch with a financial planner today, and he said the new tax plan coming from DC would eliminate tax-deductibility of state taxes. While Federal tax rates might go down a little, the net impact would be higher total taxes via higher total federal taxes due to the loss of writing off state taxes. At least, that is the view for those of us in high state income tax states like CA. He already had clients exiting the state.

     

    The gentleman I had lunch with today is a lifelong financial planner, mostly on the insurance side. He stated that the insurance industry today is in worse shape than that of the banking industry during the prior recession, and yet we hear very little about it. If so, we both agreed that the world isn’t ready for an insurance industry meltdown anything like that of the Banking industry during the last recession.

     

    I provide financing to a lot of subcontractors (the trades). While visibility 9-12 months looking forward has looked good for the past few years, I finally have a client (a framing contractor for the major home builders) that has said something to the contrary. He stated that some of his major home builders are starting to see some issues in selling inventory in CA. Without going into specifics, he also stated that he senses something is changing in their world.

     

    I’ve seen a spike in the number of unqualified (financially and expertise) in people who want to get into flipping homes. It’s becoming vogue amongst those who lack the qualification to do it at a time when the values in the San Francisco Greater Bay Area have never been higher. Somehow, 2007 peak real estate values were crazy, but the value today that are higher than 2007 are justifiable/sustainable. That’s a classic late cycle red flag.

     

    During the last 3-4 years, I’ve seen more people who seek to finance new restaurants than any time in the past 20 years. This industry seems frothy. With rising rental costs for space and higher minimum wages for staff, I’m seeing pressure on the cost structure of existing operators squeeze them, while people are rushing to build out a new restaurant.

     

    Finally, for the past 12-18 months, I’ve been flooded with new loan requests. I haven’t been this busy with new loan requests since the last cycle Top. Again, this seems like another last cycle red flag.

     

    Hope all is well

     

    “BBC”

    I had a friend tell me one time: “Mish if you ever get the urge to start a restaurant, please call me. I will talk you out of it. Some succeed, but most lose their investment or struggle for years barely surviving.”

    Everyone thinks they are different. But they aren’t. After a run up in property values, rising minimum wages, and increased competition, this is the worst time in the last 10 years.

  • The Final Straw: President Trump Had Two Scoops of Iced Cream, While Everyone Else Had One

    Correspondents from Time Magazine recently dined at the White House in the famed ‘blue room’ and were treated like savage animals. All went well with the enemies of America until dessert was prepared and served. As unbelievable as it might seem, the President made sure he was served not one, but TWO, scoops of iced cream, while everyone else got just 1.

    These revelations have led to new outrage on the left, with the people demanding swift resignation from the President.

    //platform.twitter.com/widgets.js

    Others on the right point out that President Obama was once seen with two scoops inside of a waffled cone.

    //platform.twitter.com/widgets.js

    Personally, I think the President was being generous, as I’d ensure the bastards from Time would’ve received nothing at all.

    //platform.twitter.com/widgets.js

    CNN provides coverage on this important topic.

    Content originally published at iBankCoin.com

  • 'Holier-Than-Thou' – How America's Mainstream Media Rebuke Foreign Leaders

    Authored by Brian Cloughley via The Strategic Culture Foundation,

    In the week of World Press Freedom Day the New York Times carried one of its holier-than-thou and unintentionally ironical editorials, this time titled «Donald Trump Embraces Another Despot». Seeing the headline, the world could be forgiven for asking which one it might be, this time, and eventually the Editorial Board revealed the target of their displeasure to be President Duterte of the Philippines, an unpleasant morsel of filth who had just been invited to visit the United States by President Donald Trump, who is also an unpleasant morsel of filth.

    In the run-up to identifying Mr Duterte as the object of its disapproval, the Times observed that «for the most part American presidents, Republican and Democratic, have believed that the United States should provide a moral compass to the world».

    A moral compass? That rang a bell, because one person who used this phrase recently was the US Ambassador to the United Nations, the egregious Nikki Haley, who declared at her confirmation hearing that she will «speak up against anything that goes against American values», because «we have always been the moral compass of the world». What nonsense.

    Many Americans have been horrified at the way in which their leaders have spun America’s moral compass over the years, and it is barely credible that anyone could utter such a phrase with sincerity.

    Past presidents may have paid lip-service to such ideals, but few have pursued policies that would in any way indicate that the United States of America was providing a global moral compass. Post World War II, Washington’s ethics were blasted into pieces by the Pentagon’s evil fandangos in Vietnam and surrounding countries, where the effects of its massacres, bombings of cities and towns, and use of the chemical Agent Orange are still being suffered.

    Ironically, the New York Times carried a piece in 2014 titled Agent Orange’s Long Legacy, for Vietnam and Veterans, which stated that «the war has not ended for many of the 2.8 million [US] servicemen and women who went to Vietnam. These ailing veterans are convinced that their cancers and nervous disorders and skin diseases — not to mention congenital maladies afflicting some of their children — are a result of their contact with Agent Orange». The writer claimed that «Often enough, that linkage has not been established incontrovertibly», which is a contemptible get-out, but the swinging moral compass went off the wall when he averred that the «Vietnamese accept almost as an article of faith that America’s aerial and ground spraying poisoned their environment, perhaps for decades to come, and is to blame for severe birth defects that afflict hundreds of thousands of their children. Whether that is indeed a reality has not been definitively established».

    The poison of Agent Orange has indeed continued, as evidenced by many reports, one of the latest being on 4 April 2017 that «on a hill above his home, former soldier Do Duc Diu showed me the cemetery he built for his twelve children, who all died soon after being born disabled. There are a few extra plots next to the existing graves for where his daughters, who are still alive but very sick, will be buried». And it was Presidents Kennedy, Johnson and Nixon who bore responsibility for the vile despoliation of a region and the deaths of so many of its innocent citizens.

    Moral compass? You’ve got to be joking.

    Then the Editorial Board excelled itself by pronouncing that the Presidents of the United States have been «encouraging people to pursue their right to self-government and human dignity and rebuking foreign leaders who fall short».

    The list of countries whose people have been actively discouraged by US Administrations from «pursuing their right to self-government» is long and depressing, and when there was movement to support people who want democracy the usual result was catastrophe. That this statement was made during Press Freedom Week was indeed ironic, because it was also reported that «Washington is working to push through contracts for tens of billions of dollars in arms sales to Saudi Arabia, some new, others in the pipeline, ahead of President Donald Trump's trip to the kingdom this month». He is visiting a dictatorship where, as his own State Department acknowledges, «civil law does not protect human rights, including freedoms of speech and of the press». Moral compass, anyone?

    President Duterte is a gross violator of human rights and entirely without any moral sense. As noted on CNN, he is «the thug President of the Philippines — our ally. Here’s a man who has bragged about committing murder . . . and who just happens to be presiding over an anti-drug operation that by some estimates has involved the extrajudicial killing of some 7,000 people».

    But there have been and continue to be many similar despots around the world whom the United States and the New York Times have supported for years. Take the truly evil Park Chung-Hee of South Korea with whom President Kennedy «reaffirmed the strong bonds of friendship traditionally existing between the two countries» and who lasted through Presidents Johnson, Nixon, Ford and even the faintly morally-conscious Carter, until Park’s assassination in 1979. Where was the moral compass in these hideous years in which Park was a valued ally of the United States?

    Then there was the brutal Suharto of Indonesia (1967 to 1998; Johnson, Nixon, Ford, Carter, Reagan, Bush the First, Clinton) about whom in 2015, fifty years after Suharto’s most appalling massacres, the New York Times carried a piece acknowledging that «with American support, more than 500,000 people were murdered by the Indonesian Army and its civilian death squads. At least 750,000 more were tortured and sent to concentration camps, many for decades». Reagan liked Suharto and in a speech went so far as to spin his moral compass back-to-front and say that «tonight we welcome good friends back to the White House» because he considered his dictator guest to have «clear-sighted recognition of where the interests of both our nations lie».

    Of course Suharto recognised American interests — just as present-day dictators recognise them and know that although Nikki Haley and Secretary of State Rex Tillerson and the Tweeter-in Chief, Donald Trump, should, as Haley proudly announced, «speak up against anything that goes against American values», they’ll do that selectively. They adopt this approach because although US values are Constitutionally and morally at variance with those of all the Gulf dictatorships, for example, they are subject to modification in interpretation as they go up the gently-sloped moral ladders of the Congress and the Administration.

    There are never any public rebukes for the Gulf dictators, in spite of the State Department recording that they are intolerant bigots with no regard for human rights.

    Washington declares Saudi Arabia to be «a strong partner» in spite of it being noted in the report on human rights that its citizens have no «ability and legal means to choose their government» while there are «restrictions on universal rights, such as freedom of expression, including on the internet, and the freedoms of assembly, association, movement, and religion; and pervasive gender discrimination and lack of equal rights that affected most aspects of women’s lives».

    It would be refreshing if the New York Times Editorial Board were to get hold of America’s moral compass and encourage the President to rebuke the monarchy of Saudi Arabia for its long-standing, embedded and comprehensive contempt for the rights of Saudi citizens.

    By all means criticize Trump for cosying up to the savage Duterte – but spare us the claptrap about moral compasses.

  • The Other Shoe Drops: Prime Auto Loan Losses Surge As Recoveries Tumble

    When we looked at subprime auto delinquencies most recently, we found some troubling trends: first, in February, we showed that 61+ day delinquencies in General Motors’ subprime securitization book would support a rather bleak thesis for future auto sales, and specifically the demand side of the equation, with January 2017 delinquency rates soaring to the highest levels since late 2009/early 2010. 

    Autos

    Ironically, this hasn’t stopped lenders from providing financing, and according to Morgan Stanley since 2010, the share of Subprime Auto ABS origination that has come from deep subprime deals has increased from 5.1% to 32.5%, suggesting that yield-starved buyside will put “other people’s money” into anything as long as it provides a slightly higher yield.

    Subprime

    Meanwhile, the subprime shock has already impacted the broader market, observed with the latest monthly auto sales data which declined four month in a row heading into May. An even bleaker picture of the subprime market emerged a month later when looking at the latest securitization analysis from Morgan Stanley which revealed that 60+ day delinquencies at 266 subprime auto ABS deals were surging – despite low unemployment, high consumer confidence and debt-to-income ratios at 30-year lows – back to ‘great recession’ levels. Meanwhile, loss severities were also shooting higher just as used car prices were sliding.

     

    Used Car Prices

    In part, this tied in with the overnight look at the “flood of off-lease vehicles“, according to which by the end of 2019, an estimated 12 million low-mileage vehicles are coming off leases inked during a 2014-2016 spurt in new auto sales, which is set to put even more pressure on used (and new) car prices for the foreseeable future.

    As Reuters noted, a computer search for available used vehicles within 150 miles of Reel revealed an eye-popping figure: 668 Escapes. That’s enough to put more than 40 percent of the inhabitants of this small northeastern Ohio town, population 1,600, into the popular crossover. A search for the Chevrolet Equinox, a comparable crossover, showed 461 available.

    “The automakers have flooded the market,” said Reel, owner of Reel’s Auto in Orwell, Ohio, about 40 miles east of Cleveland.

    The above trends validate a recent bearish Morgan Stanley analysis, which forecast that the plunge in used car prices is just getting started, and in a bear case, the bank sees used car prices dropping by up to 50% over the next 5 years.

     

    * * *

    However, in an even more troubling development for US consumers, it now appears that the other shoe for the US auto market has finally also dropped, and according to analyses by both Morgan Stanley and S&P, losses on prime auto loans are also surging.

    In the latest note by Morgan Stanley’s Jeen Ng, the analyst reports that “fundamental performance deterioration has not been confined to Subprime. Both 60+ day delinquencies and default rates in Prime ABS pools have nearly doubled from their post-crisis lows.”

    A slightly better picture – at least according to MS data – emerges in terms of loss severities. Still, while subprime losses are far worse, the deterioration among prime loans is unmistakable: compared to peak levels, 60+ day delinquencies in Prime auto loan pools are roughly 65% of the way back, whereas Subprime pools are close to 95% of their peak levels. On the default rate side, the deterioration is somewhat more subdued, with Subprime over 80% of the way back to prior peaks while Prime has yet to reach the 45% mark.

    One troubling observation, as confirmed in the recent Fed Senior Loan Officers Survey is that credit standards have continued to ease: as in Subprime, some of the ongoing Prime deterioration can be attributed to a relaxing of credit standards.

     

    Subprime

    Aggregate credit scores have decreased by about 5 points, which while easier is not even half as much as the 10+ point deterioration in Subprime. The same is true for longer origination terms. Most Prime issuers have extended loan terms by 3-4 months over the past 5 years. In Subprime, extension in most cases has been longer than 10 months. These easier standards can help explain both why delinquencies and defaults are higher, according to Ng. Also, keep in mind, there is a limit as to how far Prime issuers can expand their credit box in the form of lower credit scores before the deals become Subprime.

    Some more observations from Morgan Stanley, which finds a particular deterioration in recent loan issuance at Huyndai and Mercedes:

    As auto lenders expand their credit box to weaker credit borrowers, we should expect to see poorer credit performance among more recent deals relative to the more seasoned ones.

     

     

    Across the OEM originators above, we see a very consistent shift in lending standards over time – marginally longer loan terms, higher credit scores and lower used car composition. Overall, the longer loan terms and higher credit scores have offsetting effects on fundamental performance. If we look at the 60+ delinquencies and 3-month CDR curves by vintage, we don’t necessarily observe performance  deterioration over time, and for some issuers we even see relative outperformance among recent deals. However, we do see higher severities among recent vintages, which we can at least partly attribute to the decline in used car values.

     

    HART (Hyundai) and MBART (Mercedes Benz) serve as exceptions to the above, with a higher % of used vehicles and FICO migration of less than +10 points over the last 7 years. They are also the two shelves which show the most pronounced performance shift. TAOT (Toyota) also extended their credit score by less than 10 points, but their change in origination loan terms has been minimal and they have a lower  composition of used vehicles over time.

    Additionally, in terms of loss severities, the bank finds that all originator types appear to be trending higher in similar fashion, with non-bank originators printing the lowest recovery values. OEM originators overtook bank originators to see the highest recovery values last year.

    * * *

    In a separate, and even more downbeat report, S&P Global Ratings analyst Ann Matin noted that losses in bonds tied to “prime auto loans have surged surged in recent months from a year ago, hurt by falling recoveries” and notes that prime net losses rose to 0.73% in February from 0.57% in same month last year. According to S&P, bonds from some issuers that have become a larger share of the index, including Mechanics Bank’s California Republic and TCF Financial Corp., and both are contributing to those higher losses.  Additionally, the rating agency referred to the abovementioned loan losses at Huyndai, stating that “we’ve increased our expected cumulative net loss levels for certain issuers, including Hyundai’s most recent transaction, HART 2017-A.”

    Margin also wrote that prime asset-backed deals issued in 2015 seem to be performing worse, comparatively, than those sold between 2010 and 2014, and the deterioration in loans made to strong credit borrowers has forced S&P to revise its net loss expectations for various bonds.

    * * *

    To summarize: subprime loan losses have been surging alongside loss severities (with the buyside happy to soak up any and all issuance, regardless of underlying fundamentals), as recoveries slide, and in recent months this deterioration has finally shifted over to prime loans. Meanwhile, used car prices are tumbling, while new car sales have declined for 4 consecutive months as auto loan demand among tapped out consumers has tumbled. Meanwhile, millions of used cars are about to hit the market as they come off lease, which in turn will further pressure used car prices and new car sales.

    So what happens next?  Here, we’ll repeat what we concluded last night:

    Unstable used car prices will almost certainly reduce OEM reliance on leases as the implied 3-year depreciation (or residual values, if you prefer) will make them all but completely uneconomical: remember, Americans only care about that monthly payment.  Meanwhile, the relative value between used and new cars will tilt heavily in favor of the used market.  Thankfully Americans will still be able to buy that Mercedes they require to get back and forth from their minimum wage jobs, while maintaining a monthly payment of $500 or less, but it will just have to have 30,000 miles on it.

    Of course, the OEMs of the world won’t admit that their game is over until it’s way too late.  So, they’ll keep right on producing new cars to cover a 17-18mm SAAR environment up until the point they face an outright revolt from their dealer networks.  At that point, however, dealer inventories will be so high that Detroit will be forced to shutdown for months on end while new car prices are slashed to reduce the massive inventory glut.  Tanking new car prices will put even more pressure on used car prices which will mark the beginning of the death spiral that will result in a new round of inevitable auto bankruptcies, catalyzing the next economic contraction… assuming one hadn’t started already.

  • Arizona Passes Bill To End Income Taxation On Gold And Silver

    Sound money advocates scored a major victory on Wednesday, when the Arizona state senate voted 16-13 to remove all income taxation of precious metals at the state level. The measure heads to Governor Doug Ducey, who is expected to sign it into law.

    Under House Bill 2014, introduced by Representative Mark Finchem (R-Tucson), Arizona taxpayers will simply back out all precious metals “gains” and “losses” reported on their federal tax returns from the calculation of their Arizona adjusted gross income (AGI).

    If taxpayers own gold to protect themselves against the devaluation of America’s paper currency, they frequently end up with a “gain” when exchanging those metals back into dollars. However, this is not necessarily a real gain in terms of a gain in actual purchasing power. This “gain” is often a nominal gain because of the slow but steady devaluation of the dollar.  Yet the government nevertheless assesses a tax.

    Sound Money Defense League, former presidential candidate Congressman Ron Paul, and Campaign for Liberty helped secure passage of HB 2014 because “it begins to dismantle the Federal Reserve’s monopoly on money” according to JP Cortez, an alumnus of Mises University.

    Ron Paul noted, “HB 2014 is a very important and timely piece of legislation. The Federal Reserve’s failure to reignite the economy with record-low interest rates since the last crash is a sign that we may soon see the dollar’s collapse. It is therefore imperative that the law protect people’s right to use alternatives to what may soon be virtually worthless Federal Reserve Notes.” In early March, Dr. Paul appeared before the state Senate committee that was considering the proposal.

    “We ought not to tax money, and that’s a good idea. It makes no sense to tax money,” Paul told the state senators. “Paper is not money, it’s a substitute for money and it’s fraud,” he added, referring to the fractional-reserve banking practiced by the Federal Reserve and other central banks.

    After the committee voted to pass the bill on to the full body of the Senate, Dr. Paul held a rally on the grounds of the state legislature, congratulating supporters of the measure and of sound money.

    Paul told the crowd that “they were on the right side of history” and that even though those working to restore constitutional liberty to Arizona and all the states “had a great burden to bear,” there are “more than you know” working toward the same goal.

    Referring to the bill’s elimination of capital gains taxes on gold and silver, the sponsor of the bill, State Representative Mark Finchem, said, “What the IRS has figured out at the federal level is to target inflation as a gain. They call it capital gains.”

    Shortly after the vote in the state Senate, the Sound Money Defense League, an organization working to bring back gold and silver as America’s constitutional money, issued a press release announcing the good news.

    “Arizona is helping lead the way in defending sound money and making it less difficult for citizens to protect themselves from the inflation and financial turmoil that flows from the abusive Federal Reserve System,” said Stefan Gleason, the organization’s director

    As a reminder, in 1813 Thomas Jefferson warned, “paper money is liable to be abused, has been, is, and forever will be abused, in every country in which it is permitted.” This is also why the men who drafted the Constitution empowered Congress to mint gold and silver, sound money, and why they included not a single syllable authorizing the legislature to “surrender that critical power to a plutocracy with a penchant for printing fiat money.”

    Slowly, states may be summoning back the days when money was actually worth something. At least 20 states are currently considering doing as Arizona is about to do and remove the income tax on the capital gains from the buying and selling of precious metals: some state legislatures, including Utah and Idaho, have taken steps toward eliminating income taxation on the monetary metals.  Other states are rolling back sales taxes on gold and silver or setting up precious metals depositories to help citizens save and transact in gold and silver bullion. 

  • North Korea Test-Fires 7th Ballistic Missile Of 2017, Projectile Flew 700Km, Landed In Sea Of Japan

    Update: Japanese Chief Cabinet Secretary Yoshihide Suga said on Sunday that North Korea's firing of a ballistic missile was a violation of U.N. resolutions and that Japan strongly protested the action. Additionally:

    • *MISSILE MAY BE NEW TYPE: KYODO CITES JAPAN DEFENSE MINISTER
    • *MISSILE EST ALTITUDE 2,000KM, KYODO NEWS REPORT
    • *S. KOREA WILL DEAL STERNLY WITH N. KOREA PROVOCATIONS: YOON
    • *S. KOREA PRESIDENT STILL OPEN TO DIALOGUE WITH N. KOREA: YOON

    *  *  *

    As we detailed earlier, on the eve of a summit in Beijing, and just hours after Pyongyang's chief nuclear negotiator said North Korea is ready to hold talks with the United States "if the conditions are mature", South Korea's Yonhap reports that North Korea has fired a projectile believed to be a ballistic missile, from a region named Kusong located northwest of Pyongyang, where the North previously test-launched its intermediate-range missile.

    The nature of the projectile was not immediately clear, a South Korean military official told Reuters.

    The ballistic missile firing is North Korea’s seventh this year.

    The launch comes just hours after The South China Morning Post reports Choe Son-hui, head of the North Korea's Foreign Ministry's North America bureau, offered the assurance in the Chinese capital after an informal meeting in Norway with Thomas Pickering, a former US ambassador to the United Nations.

    "If conditions are mature, we will hold dialogue with the Donald Trump administration," she said.

     

    Choe made the remarks just days after Trump said he would be willing to meet North Korean leader Kim Jong-un "under the right circumstances".

     

    But the comments also came as the US embassy in Beijing told China's foreign ministry that North Korea's attendance at the top-level gathering for the "Belt and Road Initiative" could send the wrong message as the world was trying to pressure Pyongyang over its ­repeated missile and nuclear tests. The foreign ministry said Beijing welcomed the participation of all countries in the summit.

    South Korea's Yonhap News confirms North Korea has fired what appears to be a ballistic missile from its west coast, the South Korean military reported early Sunday. The launch would be the first in two weeks since the last attempt to fire a missile ended in a failure just minutes into flight. It would also be the first launch since a new, liberal president took office in South Korea on Wednesday saying dialogue as well as pressure must be used to ease tensions on the Korean peninsula and stop the North's weapons pursuit. The new president Moon has said he is willing to engage in dialogue with his northern neighbor.

    Weapons experts and government officials, cited by Reuters, "believe the North has accomplished some technical progress with those tests."

    South Korean Military has now confirmed it was a ballistic missile that flew 700 km.

    The Japanese government confirms the missile flew 30 minutes and landed in The Sea of Japan.

    Kim claimed in January to be in the final stages of preparations to test-fire an intercontinental ballistic missile, and has since launched several intermediate-range projectiles with varying degrees of success.

    The action provides an early test for South Korean President Moon Jae-in, who came to office on May 10 saying he would visit Pyongyang under the “right circumstances” to bring peace to the peninsula. Moon convened a meeting of the national security council Sunday morning, according to the Presidential Blue House.

    *  *  *

    Today's launch should not be a total surprise: In a interview earlier in the week with by Sky News, in response to a question "is a sixth nuclear test now imminent", the answer of the North Korean Ambassador to the UK, Choe Il was "In regards to the sixth nuclear test, I do not know the scheduled time for it, as I am here in the UK, not in my home country. However, I can say that the nuclear test will be conducted at the place and time as decided by our supreme leader, Kim Jong-Un."

    Asked if he is afraid of a possible US military response, the ambassador answers that "we are developing our nuclear strength to respond to that kind of attack by the US. If the US attacks us, our military and people are fully ready to respond to any kind of attack. I do not think the US are considering a military attack against us." 

    Asked what would North Korea's response be to a preemptive strike, he answer that: "The US cannot attack us first. If the US moves an inch, then we are ready to turn to ashes any available strategic assets of the US."

  • Trump-Appointed Manufacturing Tzar Backfires – Supports NAFTA, Backs Mexico

    In an apparent snub to the administration's trade policy plans, GE CEO Jeff Immelt – who sits on the Trump-appointed manufacturing council – said he "very supportive" of NAFTA adding that he was "optimistic about Mexico."

    Just a day after we showed Mexico's Manufacturing industrial production surge 8.5% year-over-year – the greatest surge since August 2010…

     

    And expectations for employment in US manufacturers are tumbling…

     

    Reuters reports that GE Chief Executive Officer Jeff Immelt said on a visit that Mexico had great potential and was not properly understood. He touted the conglomerate's Mexican operations and the trade deal binding Mexico, Canada and the United States.

    "GE as a company, we're very supportive of NAFTA," Immelt told employees at an event to mark the expansion of operations in the northern city of Monterrey. He said the trade accord could be modernized, as Mexico has argued.

     

    The GE boss said trade meant "win-win" opportunities across North America.

     

    "We will continue to work constructively in the context of wanting to see a close relationship between the U.S. and Mexico," he said, noting that GE's exports to the rest of the world from Mexico were worth $3 billion.

     

    "We're optimistic about Mexico, we're optimistic about what we can do here," Immelt added, saying Latin America's no. 2 economy would be a "big part" of GE's future.

    As a reminder, Immelt sits on a Trump-appointed manufacturing council (that Mexico has targeted for lobbying as Mexico and Canada push U.S. business leaders to defend NAFTA).

    While Trump touts a "Buy American" policy and has railed against U.S. companies moving operations to Mexico (threatening to ditch NAFTA, a lynchpin of the Mexican economy, if he cannot rework it to secure better terms for the United States), unlike some U.S. companies, GE has not backed off plans in Mexico, risking broadsides from Trump on Twitter.

    How long before Mr. Immelt gets a tap on the shoulder?

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