- Austrian Parliament To Declare BDS Movement As Anti-Semitic
Austrian Parliament To Declare BDS Movement As Anti-Semitic
Authored by Soeren Kern via The Gatestone Institute,
All of the major parties represented in the Austrian Parliament have agreed to support a resolution condemning the anti-Israel Boycott, Divestment and Sanctions (BDS) movement as anti-Semitic.
The measure calls on Austria’s federal government to fight anti-Semitism and anti-Zionism, and to withhold any form of financial and other state support from anti-Semitic organizations and advocates of BDS principles.
The resolution will be submitted to the lower house of Parliament, the National Council, in January 2020. It is expected to be passed with an overwhelming majority. While anti-BDS laws have been passed in Vienna and Graz, the largest and second-largest cities in Austria, this would be the first time that such a measure is enacted at the federal level.
On December 11, legislators from all five major parties — including the left-leaning Greens and the right-leaning Freedom Party (Freiheitliche Partei Österreichs, FPÖ) — formally agreed to co-sponsor the resolution, which is being spearheaded by Sebastian Kurz, a former (and most likely the next) chancellor of Austria who also leads the center-right Austrian People’s Party (Österreichische Volkspartei, ÖVP). The resolution states:
“Anti-Semitism has existed since antiquity, although the term itself was not used until the 19th century. The core, however, was always the same: it was — and is — the fomenting of prejudices and hatred in word and deed against Jews. Throughout history they have been victims of violence and exclusion, which reached a devastating climax in the murderous cruelty of National Socialism and the declared goal of the systematic destruction of Jewry by the Nazi regime.
“In total, more than six million Jews, many of them children, fell victim to the Shoah. They were murdered in the extermination camps by poison gas or otherwise. But even this unimaginably cruel genocide and the memory of it has not caused many people to rethink, and so Jews, even in the present, are exposed, once again, to hate and prejudices, which in the worst cases culminate in violence.
“In a survey of 16,500 Jewish Europeans in 12 European countries conducted by the EU’s Fundamental Rights Agency in May/June 2018, highly alarming findings emerged: nine out of ten respondents said that anti-Semitism had intensified, and one-third were considering emigrating.
“The European Parliament’s Working Group on Anti-Semitism (EP WGAS) has already done valuable work. In June 2017, an anti-Semitism resolution was adopted by a large majority in plenary. The text included calling for all EU Member States to adopt the definition of anti-Semitism developed by the International Holocaust Remembrance Alliance (IHRA) and to train their police and judicial authorities on how to prosecute anti-Semitism. Austria was one of the first EU Member States to adopt this IHRA working definition of anti-Semitism by a resolution of the Council of Ministers on April 21, 2017.
“The Austrian Presidency of the EU unanimously adopted a declaration on combating anti-Semitism and developing a common approach to security for Jewish communities and institutions during the Justice and Home Affairs Council on December 6, 2018. The European Council welcomed this statement in its conclusions of December 13 and 14, 2018. This path must continue to be pursued consistently.
“Also, in 2018, the President of the National Council, Wolfgang Sobotka, commissioned a study to understand the level of anti-Semitic sentiments in Austria. The result of this study is that 10% of Austrians are manifestly anti-Semitic and 30% are latently anti-Semitic. The percentages are alarmingly higher among the Turkish and Arabic-speaking people who were born in Austria or have lived with us for more than ten years.
“According to the IHRA anti-Semitism definition adopted by Austria, the State of Israel, which is understood as a Jewish collective, may be the target of anti-Semitic hostility, such as the rejection of the right of the Jewish people to self-determination, collective responsibility of Jews for acts of the State of Israel, or comparisons between current Israeli politics and Nazi policies.
“The ‘Boycott, Divestment and Sanctions’ (BDS) movement, which has increasingly appeared in Austria in recent years, makes use of this anti-Semitic pattern: This movement calls for a boycott of the Jewish state, of Israeli products and companies, of Israeli artists, scientists and athletes. It demonizes and measures Israel by double standards, makes Austrian Jews jointly responsible for Israeli politics, and by calling for the right of return for Palestinian refugees and all their descendants, it questions the right of existence of the Jewish state.
“For Austria, Israel’s right to exist is non-negotiable, and any form of anti-Semitism, including Israel-related anti-Semitism, is unacceptable and must be severely condemned. Of course, factual criticism of individual measures by the government of Israel must be allowed.
“The National Council strongly condemns all forms of anti-Semitism, including Israel-related anti-Semitism, and calls on the federal government to resolutely and consequently confront these tendencies.
“The federal government is further requested:
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to develop a holistic strategy to prevent and combat all forms of anti-Semitism, with close involvement of all relevant bodies, as part of its strategies to prevent racism, xenophobia, radicalization and violent extremism;
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to strongly condemn the BDS movement and its goals, in particular the call for a boycott of Israeli products, companies, artists, scientists or athletes;
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to not provide premises and infrastructure to organizations and associations that use anti-Semitic rhetoric or question Israel’s right to exist;
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to not support, financially or otherwise, events of the BDS movement or groups that pursue similar goals;
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to maintain Austria’s role as an excellent place for international dialogue and exchange.”
The Austrian resolution, one of the most forceful European statements of support for Israel to date, is part of a growing pushback against the BDS movement.
On November 14, 2019, the City Council of Graz, the second-largest city in Austria, adopted a resolution against anti-Semitism and the anti-Israel BDS movement. The council stated that it “resolutely opposes every form of anti-Semitism and condemns the BDS campaign and the call for a boycott of the Jewish state as clearly anti-Semitic.” The council said that “no organizations should be financially supported that question Israel’s right to exist.” It added:
“Projects that call for a boycott or support the BDS movement must not be financially supported. Also, as a result of the decision, the City of Graz will no longer provide urban space for BDS campaigns or events in the future.”
On June 27, 2018, the City Council of Vienna unanimously passed an anti-BDS resolution, which stated:
“The City of Vienna strongly condemns the spread of anti-Semitism worldwide, opposes the anti-Semitic BDS campaign, will not provide urban space for BDS campaigns or events, exhibitions or demonstrations that pursue BDS goals, and will not provide any other support for BDS events.”
On May 17, 2019, the German Parliament passed a resolution condemning the BDS movement as anti-Semitic and pledging to cut off funding to any organizations that actively support BDS. The resolution, passed by a broad cross-party alliance, stated:
“The all-embracing boycott call in its radicalism leads to the branding of Israeli citizens of the Jewish faith. There are statements and actions from the BDS movement that seek to cast doubt on the right of existence of the State of Israel. Calls for boycott are reminiscent of anti-Semitic positions of National Socialism are unacceptable and sharply condemnable.”
The conservative anti-establishment party, Alternative for Germany (AfD), said that the resolution did not go far enough and called for a total ban of BDS activities in Germany. It noted that the BDS movement “has its origins in the anti-Semitic and anti-Zionist initiatives of Arab groups that were already active long before the founding of the State of Israel and that between 1933 and 1945 were in close and friendly contact with the National Socialist government of Germany.”
On October 22, 2019, the Czech Chamber of Deputies passed a non-binding resolution calling for the government “to refuse financial support from such organizations for such movements, organizations and organizations in the European Union, the United Nations and other international institutions and associations calling for a boycott of the State of Israel.”
On July 23, 2019, the U.S. House of Representatives overwhelmingly passed a bi-partisan resolution rejecting the BDS campaign against Israel. The bill — formally known as House Resolution 246 — passed by a vote of 398-17, with five abstentions. The bill was opposed by one Republican and 16 Democrats, including the first two Muslim women elected to Congress: representatives Rashida Tlaib of Michigan and Ilhan Omar of Minnesota.
The measure “opposes the Global Boycott, Divestment, and Sanctions Movement (BDS Movement) targeting Israel, including efforts to target United States companies that are engaged in commercial activities that are legal under United States law, and all efforts to delegitimize the State of Israel.”
It also stated that the BDS campaign “undermines the possibility for a negotiated solution to the Israeli-Palestinian conflict by demanding concessions of one party alone and encouraging the Palestinians to reject negotiations in favor of international pressure.”
Anti-BDS resolutions have been passed in 27 U.S. states: Alabama, Arizona, Arkansas, California, Colorado, Florida, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maryland, Michigan, Minnesota, Nevada, New Jersey, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Tennessee, Texas, Virginia and Wisconsin.
Tyler Durden
Wed, 12/18/2019 – 02:00 -
- Never Trust A Failing Empire
Never Trust A Failing Empire
Authored by Federico Pieraccini via The Strategic Culture Foundation,
The Washington Post, through documents released through the Freedom of Information Act, has published a long investigation into Afghanistan. Journalists have collected over 400 testimonies from American diplomats, NATO generals and other NATO personnel, that show that reports about Afghanistan were falsified to deceive the public about the real situation on the ground.
After the tampering with and falsification of the report of the Organization for the Prohibition of Chemical Weapons (OPCW), we are witnessing another event that will certainly discomfit those who have hitherto relied on the official reports of the Pentagon, the US State Department and international organizations like the OPCW for the last word.
There are very deliberate reasons for such disinformation campaigns. In the case of the OPCW, as I wrote some time back, the aim was to paint the Syrian government as the fiend and the al-Qaeda- and Daesh-linked “moderate rebels” as the innocent souls, thereby likely justifying a responsibility-to-protect armed intervention by the likes of the US, the UK and France. In such circumstances, the standing and status of the reporting organization (like the OPCW) is commandeered to validate Western propaganda that is duly disseminated through the corporate-controlled mainstream media.
In this particular case, various Western capitals colluded with the OPCW to lay the groundwork for the removal of Assad and his replacement with the al-Nusra Front as well as the very same al-Qaeda- and Daesh-linked armed opposition officially responsible for the 9/11 attacks.
As if the massaging of the OPCW reports were not enough in themselves to provoke international outrage, this dossier serves to give aid and comfort to jihadi groups supported by the Pentagon who are known to be responsible for the worst human-rights abuses, as seen in Syria and Iraq in the last 6 years.
False or carefully manipulated reports paint a picture vastly different from the reality on the ground. The United States has never really declared war on Islamic terrorism, its proclamations of a “War on Terror” notwithstanding. In reality, it has simply used this justification to occupy or destabilize strategically important areas of the world in the interests of maintaining US hegemony, intending in so doing to hobble the energy policies and national security of rival countries like China, Iran and the Russian Federation.
The Post investigation lays bare how the US strategy had failed since its inception, the data doctored to represent a reality very different from that on the ground. The inability of the United States to clean up Afghanistan is blamed by the Post on incorrect military planning and incorrect political choices. While this could certainly be the case, the Post’s real purpose in its investigation is to harm Trump, even as it reveals the Pentagon’s efforts to continue its regional presence for grand geopolitical goals by hiding inconvenient truths.
The real issue lies in the built-in mendacity of the bureaucratic and military apparatus of the United States. No general has ever gone on TV to say that the US presence in Iraq is needed to support any war against Iran; or that Afghanistan is a great point of entry for the destabilization of Eurasia, because this very heart of the Heartland is crucial to the Sino-Russian transcontinental integration projects like the Eurasian Economic Union (EAEU) and the Belt and Road Initiative. In the same vein, the overthrow of the Syrian government would have ensured Israel a greater capacity to expand its interests in the Middle East, as well as to weaken Iran’s main regional ally.
The Post investigation lays bare the hypocrisy of the military-industrial complex as well as the prevailing political establishments of Europe and the United States. These parties are not interested in human rights, the wellbeing of civilians or justice in general. Their only goal is to try and maintain their global hegemony indefinitely by preventing any other powers from being able to realize their potential and thereby pose a threat to Atlanticist preeminence.
The war in Iraq was launched to destabilize the Middle East, China’s energy-supply basin crucial to fueling her future growth. The war in Syria served the purpose of further dismantling the Middle East to favor Saudi Arabia and Israel, the West’s main strategic allies in the Persian Gulf. The war in Afghanistan was to slow down the Eurasian integration of China and Russia. And the war in Ukraine was for the purposes of generating chaos and destruction on Russia’s border, with the initial hope of wresting the very strategically area of Crimea from Russia.
The best-laid plans of mice and men often go awry, and this has been on full display in recent times. Almost all of Washington’s recent strategic objectives have ended up producing results worse than the status quo ante. In Iraq there is the type of strong cooperation between Baghdad and Tehran reminiscent of the time prior to 1979. Through Hezbollah, Iran has strengthened its position in Syria in defense of Damascus. Moscow has found itself playing the role of crucial decider in the Middle East (and soon in North Africa), until only a few years ago the sole prerogative of Washington. Turkey’s problems with NATO, coupled with Tel Aviv’s open relation with Moscow are both a prime example of Washington’s diminishing influence in the region and Moscow’s corresponding increase in influence.
The situation in Afghanistan is not very different, with a general recognition that peace is the only option for the region being reflected in the talks between the Afghans, the Taliban, the Russians, Chinese, Indians and Pakistanis. Beijing and Moscow have well known for over a decade the real intent behind Washington’s presence in the country, endeavoring to blunt its impact.
The Post investigation only further increases the public’s war weariness, the war in Afghanistan now having lasted 18 years, the longest war in US history. Jeff Bezos, the owner of the Post, is a bitter opponent of Trump and wants the president to come clean on the Afghanistan debacle by admitting that the troops cannot be withdrawn. Needless to say, admitting such would not help Trump’s strategy for the 2020 election. Trump cannot afford to humiliate the US military, given that it, along with the US dollar, is his main weapon of “diplomacy”. Were it to be revealed that some illiterate peasants holed up in caves and armed with AK-47s some 40 years ago are responsible for successfully keeping the most powerful army in history at bay, all of Washington’s propaganda, disseminated by a compliant media, will cease to be of any effect. Such a revelation would also humiliate military personnel, an otherwise dependable demographic Trump cannot afford to alienate.
The Washington Post performed a service to the country by shedding light on the disinformation used to sustain endless war. But the Post’s intentions are also political, seeking to undermine Trump’s electoral chances by damaging Trump’s military credentials as well as his standing amongst military personnel. What Washington’s elite and the Post do not know, or perhaps prefer to ignore, is that such media investigations directed against political opponents actually end up doing irreparable damage to the political and military prestige of the United States.
In other words, when journalist do their job, the military industrial complex finds it difficult to lie its way through wars and failures, but when a country relies on Hollywood to sustain its make-believe world, as well as on journalists on the CIA payroll, on compliant publishers and on censored news, then any such revelations of forbidden truths threaten to bring the whole facade crashing down.
Tyler Durden
Wed, 12/18/2019 – 00:05 - SoCal Millennials Are Piling On Most Credit Card Debt
SoCal Millennials Are Piling On Most Credit Card Debt
Beverly Hills’ Millennials were far ahead of the competition in terms of credit card debt, showing, as Statista’s Katharina Buchholz explains, the correlation that exists between high incomes and credit card use in the United States. Cities in affluent Southern California, especially in the Los Angeles area, had some of the highest average per capita credit card debt rates for Millennials, according to website Experian.
Beverly Hill’s Millennials piled on an average of more than $12,000 in credit card debt, far more than second-placed Monsey in the New York area, where the average debt rate was around $8,600.
You will find more infographics at Statista
Because high incomes normally lead to better credit scores, richer people are able to go into more debt on their cards. High debt municipalities were most often found around big cities, showing another reason Millennials might feel the need to go into debt: high cost of living. In recent years, U.S. wage growth has not kept up with housing costs, a fact that is amplified in bigger cities – top 10 cities for credit card debt among Millennials were found around L.A., New York, Houston, Miami and Austin.
Tyler Durden
Tue, 12/17/2019 – 23:45 - 10 Self-Evident Truths That 'We, The People' Have Spontaneously Come To Realize…
10 Self-Evident Truths That ‘We, The People’ Have Spontaneously Come To Realize…
Authored by Mike Adams via NaturalNews.com,
We have a lot to thank Trump for, but among the most important is the idea that Trump has caused the corrupt, fraudulent, lying specter of “Big Government” to fully reveal itself for what it truly is.
Does anyone trust the FBI after reading the shocking findings of the Horowitz (IG) report? Not on your life.
Does anyone believe the Democrats are pursuing legitimate “impeachment” based on legitimate “high crimes?” Not a chance.
Does any rational person think that high-level lawmakers and bureaucrats aren’t on the take, receiving kickbacks from billions in foreign aid?
It’s quite stunning, actually, how the mass awakening has accelerated over the last three years as Trump has succeeded as President. In their desperate attempt to destroy Trump, the deep state swamp creatures and corrupt, lawless Democrats have been forced to reveal the truth about their corruption, fraud and malicious abuse of power.
Because of all this, there are many self-evident truths that have now become obvious to the American people. Read from the point of view of the People talking to the political swamp in Washington D.C.:
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We don’t believe you.
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You are all dishonest crooks and horrible people who should never be trusted again.
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The intelligence community is the enemy of the people and must be dismantled if any American is to ever be truly free.
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We are not going to voluntarily hand over our guns. You may come try to take them by force, but we will shoot you if you try.
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We are withdrawing our consent. You are now a rogue enemy government that we finally recognize as the ENEMY.
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We are never going to vote for establishment candidates ever again.
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We will not live as slaves, suffering under your tyranny. We would rather die as Americans, defending our liberty and our republic.
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If we ever get the chance, we will arrest all of you and throw you in prison for as long as you live.
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We will no longer cooperate with your sham court system, your corrupt FBI and your lawless federal regulators. They are all fraudulent, criminal cartels that have no legitimate authority. You have lost the consent of “the governed.”
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Your fiat currency financial system and debt Ponzi scheme is a criminal fraud that steals money from the working class. We will no longer hold your dollars and will seek alternatives at every opportunity.
I’m sure you can think of dozens more, but that short list sums up the highlights.
The bottom line should be crystal clear: The United States federal government is run by illegitimate, corrupt, fraudulent swamp creatures and the very future of freedom for America depends on completely dismantling the very concept of a “government” that rules over the people.
The time has come to end the era of big government. We the People no longer need “representatives” in Washington. We don’t need a United States Senate, packed with treasonous crooks (like McCain or Reid) and foreign aid skimming hucksters. We don’t need the FDA or the CDC, both of which are nothing but fake science marketing departments for Big Pharma. We don’t need the Federal Reserve, a fiat currency counterfeiting operation that steals from all working Americans. And we don’t need the intelligence community, which has morphed into a domestic spying secret police operation that routinely abuses its power to surveil and threaten innocent Americans.
We don’t need government-run health care, government-run food stamps or government-run anything, other than defending the shores, setting standards and using the limited powers of small government to protect the rights of individuals against dangerous corporations such as banks and tech giants. That’s the proper role of government: To protect liberty, not to rule over the people.
Do not surrender an inch to this corrupt, lawless system run by traitors and tyrants. Every Democrat in Washington D.C., without exception, is guilty of treason and should be arrested, charged and treated accordingly. And half the Republicans are guilty of the same crime, by the way.
The entire system is corrupt beyond repair. The deep state swamp cannot investigate itself, yet all the powers of investigation have been concentrated in the hands of the very people who are the most dangerous, corrupt criminals of all.
It’s time to revoke our consent from this criminal government and dismantle it once and for all.
Trump is attempting to do exactly that, but even he is spending America into oblivion with record debt spending. Perhaps he realizes a financial implosion is the only sure way to bring down the whole corrupt system.
There will never be another Trump. Once Trump’s tenure is up, We the People must continue his work of exposing, dismantling and rejecting the criminals, crooks and fraudsters in Washington D.C. The very existence of big government is irreconcilable with personal liberty and prosperity. We can either be free and prosperous, or we can be enslaved and forced into destitution under the rule of big government tyranny.
Tyler Durden
Tue, 12/17/2019 – 23:25 -
- Boeing 737 MAX Production Halt Will Slash A Third Off Q1 GDP
Boeing 737 MAX Production Halt Will Slash A Third Off Q1 GDP
Several months ago, when news of the grounding of Boeing’s 737 MAX fleet first hit, we wrote that this would likely lower GDP growth by around 0.3%-0.5% in both Q2 and Q3, as the collapse in shipments was only partially offset by a pickup in the inventory component. Last night’s announcement that production of the plane will also be halted indefinitely, suggests a longer, and more acute hit to US GDP.
First, some history: After the plane was grounded in March, deliveries were halted, producing a roughly 33% decline in nondefense aircraft and parts shipments. However, Boeing continued to produce the plane—albeit in more limited quantities (42/month vs. 52/month)—and placed them in inventory instead of shipping them out while waiting for reauthorization. As a result, industry-wide production of aircraft declined by a much less dramatic ~20%.
All that stopped last night. According to economists from JPMorgan, Goldman and Capital Economics, Boeing’s work stoppage will cut up to 0.5% from first quarter 2020 GDP, with risk to the upside as Boeing’s suppliers are already reeling from the uncertainty around just how long this production halt will last.
While Boeing previously cut production of the 737 Max to 42 a month, down from 52 in March, the move did not have a shocking impact on the economy. However, a full stop in production means the GDP-boosting rise in inventories will end, resulting in a hit to growth.
In the chart below, Goldman used relevant GDP source data to produce a more comprehensive estimate of the GDP contribution from commercial aircraft output. The bank found that the decline in aircraft shipments has indeed only been partially offset by a pickup in measured inventory investment (the former is reflected in the GDP statistics in business investment, the latter in the change in private inventories).
What happens next?
“The expected drag on 1Q GDP growth should be concentrated in reduced inventory accumulation,” said JPMorgan chief economist Michael Feroli, who also expects the monthly factory orders and non-farm payroll reports to be adversely impacted by Boeing’s production halt.
Meanwhile, according to the FT, Michael Pearce at Capital Economics expects a 0.5% hit to GDP growth in the first three months of the year if the shutdown lasts the entire quarter. He said the move will reduce output of commercial aircraft by about $25bn annualized. Pearce expects the decision could deliver a “big hit to the manufacturing sector just as prospects were beginning to brighten” and cautioned that if staff at Boeing’s suppliers are impacted, “there’s a risk the damage could be even worse.”
Goldman also chimed in today, pointing out that “given that 737 MAX production will halt entirely in January, inventory growth is set to fall sharply, which will weigh on Q1 GDP growth.” Source data available for October and November indicate that the elevated pace of inventory accumulation in Q3 has continued into Q4. Because the second derivative of inventories is what matters for GDP growth, Goldman expects the Q1 slowdown in inventory accumulation to lower growth in the quarter by around 0.4%, reflecting an $18bn decline in the pace of real inventory investment, as shown in the next chart.
The good news is that for now, Boeing has avoided any layoffs, but depending on the length of the stoppage that will change; Pearce expects at least some of the workers “at the more than 600 smaller companies in the supply chain will be furloughed or laid off,” and this could halt their investment plans and could crop up in jobless claims and consumer confidence data.
The bigger issue is that with Q1 GDP already set to print at just 1.5%, another 0.5% in growth being removed will result in the worst quarter for US GDP in years, and would leave the US economy precariously close to a recession.
The silver lining in this situation is that once the 737 Max gets the green light to get off the ground again, the US economy stands to get a big boost as there will be a surge in exports and investment, though this could be delayed until the second half of 2020 . Indeed, as Goldman puts it, “a potential recertification of the plane suggests scope for the level of GDP to rebound by around 0.3% (or 1.2pp annualized) at some point in the future, but we will wait for clarity on the timing before incorporating this into our baseline forecasts.”
Of course, the upside scenario is based on the assumption that the 737 Max grounding will end… eventually. The problem is that the longer this plane remains grounded, the lower its odds of ever flying again. Meanwhile, every quarter 737 Max production is mothballed, US GDP will continue to be hit by about 0.5% relative to some optimistic ~2% or so baseline which assumed airplane production in perpetuity. As such, just a fairly modest hit to the US economy will be sufficient to finally send the economy into a recession.
Tyler Durden
Tue, 12/17/2019 – 23:05 - The Big Hole In The China Trade Agreement
The Big Hole In The China Trade Agreement
Authored by Gordon Chang via The Gatestone Institute,
There’s something missing from the “Phase One” trade agreement with China, announced Friday. And it’s something critically important. Yet, Larry Kudlow, President Trump’s director of the National Economic Council, appeared not to know about it afterwards.
“We will see,” said Kudlow in response to Maria Bartiromo on “Sunday Morning Futures,” her Fox News Channel show, as she asked him about Beijing’s new “cybersecurity” rules.
“There’s a large IP chapter in this deal and there’s also a large forced technology transfer chapter in this deal. I don’t think we know enough about these new Chinese rules and we’ll have to look at that and by the way if they do violate them of course we will take action.”
Bartiromo was referring to two sets of Chinese rules.
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On December 1, Beijing implemented the Multi-Level Protection Scheme 2.0, issued pursuant to the 2016 Cybersecurity Law.
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On January 1, China’s Cryptography Law becomes effective.
These measures prohibit foreign companies from encrypting data so that it cannot be read by the Chinese central government and the Communist Party of China. Businesses will be required to turn over encryption keys. Companies will not be able to employ virtual private networks to keep data secret, and some believe they will no longer be allowed to use private servers.
Together, these measures allow Beijing to take all the data and communications of foreign companies.
Beijing’s complete visibility into the networks of foreign companies will have extremely disadvantagious consequences. For instance, Chinese officials will be permitted, under Chinese law, to share seized information with state enterprises. This sharing means the enterprises will weaponize the information against their foreign competitors.
Moreover, China’s officials, once they have encryption keys and access to the China network of a foreign firm, will be in a good position to penetrate the networks of that firm outside China. Therefore, Beijing will soon steal data stored on foreign networks and put companies, like Nortel Networks, out of business or ruin them to the point where Chinese entities can buy them up at reduced prices. Do we really want the Fortune 500 to be owned by China?
The U.S. Trade Representative’s skimpy Fact Sheet for the Phase One deal does not address the December 1 and January 1 rules. There is, of course, no point in including in the trade deal forced taking and intellectual property protections if they do not cover the cybersecurity rules.
Judging from Kudlow’s nonspecific response to Bartiromo and his admission of not knowing much about “these new Chinese rules,” the administration apparently has not considered the linkages between them and the trade deal. If that is indeed the case, the Phase One deal will be pointless. Anything — information, data, communications, trade secrets, or technology — protected under its terms will nonetheless be available to Chinese authorities pursuant to the December 1 and January 1 rules.
The remedy? President Trump can pull out of the Phase One deal — something he should do anyway — or use his considerable powers under the International Emergency Economic Powers Act of 1977 to prohibit American companies from complying with the new cybersecurity rules or from storing data in China. On August 23, Trump threatened to use the act to force companies out of that country.
Washington will have to do something fast to protect American businesses in China — and the American economy — because the Phase One deal is clearly inadequate. There is, after all, a big hole in the center of it.
Tyler Durden
Tue, 12/17/2019 – 22:45 -
- Fed President's Shocking Admission: "We Need To Be Pretty Focused On Asset Prices, Not Just Inflation"
Fed President’s Shocking Admission: “We Need To Be Pretty Focused On Asset Prices, Not Just Inflation”
There was an stunning admission by Boston Fed head Eric Rosengren on Tuesday, when during an audience Q&A after a speech to The Forecasters Club of New York, the voting FOMC member (and chronic dissenter – Rosengren has voted against all three rate cuts made by the Fed this year) the former dove warned that lower rates could encourage excessive risk taking and over-leveraging, which would create great risks during a downturn. More importantly, he confirmed that high asset prices are a direct function of low rates, and thus Fed policy, and it is the Fed that is responsible for not only all prior bubbles, but the biggest one them all: the one right now.
“I do have concerns about that financial stability. I would prefer probably a different level of rates,” the Boston Fed President said, confirming that low rates will eventually result in a financial crisis, and that only higher rates can lead to a final outcome that is not apocalyptic.
Rosengren said that following three rate cuts this year and the launch of QE4, he remains worried that lower rates could encourage corporations to take on excessive risk and borrow too much. The policymaker said companies that are over-leveraged may have to lay off more workers in a downturn, which could amplify losses and cause more damage to the economy.
Most importantly, the Boston Fed confirmed what we have been saying all along: the Fed should be worried not just about economic inflation – which remains muted – but also asset prices, which have been gripped by runaway inflation over the past decade.
“If you look at the last two recessions, they were not situations where inflation got out of control. They were situations where asset prices went way up and then came way down. So if your goal is to avoid recessions, I think we need to be pretty focused on asset prices not just inflation“, Rosengren said in a moment of shocking candor and transparency.
He was referring, of course, to the chart below which we have shown on many prior occasions, yet which most of Rosengren’s peers refuse to admit even exists.
Rosengren’s conclusion, while spot on, to wit “If what you want to do is avoid recessions in the future, you have to be thinking about what is happening to asset prices as well”, will be ignored by everyone, from investors to policy makers, because if the Fed admits that Rosengren is right and the Fed has to start “paying attention” to the hyperinflation it has created across asset prices, then the party is over. It’s even worse when considering that the Fed has blown such an asset price bubble in equities and other assets, that the only possible outcome is either for the bubble to burst, or to keep growing exponentially, making the resulting crisis far worse.
Of course, while the Fed may still be ignoring what is so blatantly obvious to everyone else, the problem is that increasingly more ordinary people are realizing that in a time when the S&P is up 27% and wages are barely higher for the 10th consecutive year, there is something catastrophically wrong… and that thing is called monetary policy. And once the tipping point of populist anger finally arrives and an angry platoon of pitchfork-dragging discontents arrives at the Fed building in D.C., that’s the moment when the insanity of the past decade will finally be over. Insanity, which incidentally started with Ben Bernanke’s explanation in a WaPo op-ed just why the Fed’s true mandate is to push stock prices higher, because – somehow – it would stimulate the economy (recall: “higher stock prices will boost consumer wealth and help increase confidence, which can also spur spending”). Instead, all the Fed’s mandate of levitating asset achieved was to make the top 0.01% richer than ever, crush the middle class, and unleashed a tidal wave of populist anger that will eventually culminate with an angry mob burning down the Marriner Eccles building. For the sake of everyone, we can only hope that said mob does not wait too long.
Tyler Durden
Tue, 12/17/2019 – 22:25 - Buchanan: Will The Secessionist Epidemic Ever End?
Buchanan: Will The Secessionist Epidemic Ever End?
Authored by Pat Buchanan via Buchanan.org,
Fresh from his triumphal “Get Brexit Done!” campaign, Prime Minister Boris Johnson anticipates a swift secession from the European Union.
But if Britain secedes from the EU, warns Scotland’s first minister Nicola Sturgeon, Scotland will secede from the United Kingdom.
Northern Ireland, which voted in 2016 to remain in the EU, could follow Scotland out of Britain, leaving her with “Little England” and Wales.
Not going to happen, says Boris. His government will not allow a second referendum on Scottish independence.
Yet the Scottish National Party won 48 of Scotland’s 59 seats in Parliament, and Sturgeon calls this a mandate for a new vote to secede:
“If (Boris) thinks … saying no is the end of the matter then he is going to find himself completely and utterly wrong. … You cannot hold Scotland in the union against its will.”
She has a point. If a majority of Scots wish to secede, how does a democratic Great Britain indefinitely deny them the right of self-determination?
Is Scotland fated to become for Britain what Catalonia is to Spain?
Where does this phenomenon, this continuing unraveling of old and proliferation of new nations, this epidemic of secessionism, end?
The most recent population explosion of new nations began three decades ago, when 15 republics of the USSR became independent nations. Soon, several of the 15 began to unravel further.
Transnistria seceded from Moldova. South Ossetia and Abkhazia seceded from Georgia. Chechnya sought to break free of Russia, only to be crushed. Since 2015, the Donbass has sought to secede from Ukraine.
When Josip Tito’s Yugoslavia collapsed, six “nations” seceded from Belgrade.
When did secessionism begin? The Americans started it all.
The first great secessionist cause was the Revolution, when the 13 American colonies declared and won independence from the British crown.
It is solemnly declared today that our Revolution was about ideas, such as the equality of all men. But the author of the Declaration did not believe in equality.
Jefferson was a Virginia plantation owner, some of whose slaves were with him in Philadelphia. He described Native Americans in the Declaration as “merciless Indian Savages.” The British are fraternally called “brethren” with whom we share “ties of a common kindred,” but who have been “deaf to the voice of consanguinity.”
I.e, our cousins have been deaf to the call of our common blood.
John Jay, in Federalist 2, before the Constitution was even ratified, spoke of the elements that formed the nation — “one connected country to one united people … descended from the same ancestors, speaking the same language, professing the same religion … similar in their manners and customs.”
A second secessionist movement, six decades later, created a second American nation. Texans under Sam Houston rose up and ripped that vast province away from its young mother country, Mexico.
The third secessionist movement united 11 states that sought to create a new confederated nation outside the Union, as the revolutionary generation had created a new nation outside of Britain.
In the 19th century, a dozen new nations were created by Latin American secessionists of the Spanish and Portuguese empires who emulated the example of the Americans of 1776.
After 1945, colonies of the British, French, Portuguese and Belgian empires seceded to produce a baby boom of new nations whose most common characteristic seems to be that all receive foreign aid and all have seats in the U.N. General Assembly.
If the secessionism epidemic is to someday expire, then its causes will have to be addressed. And what are they?
Secessionism appears rooted principally in issues of national identity — ethnicity, religion, race, language, culture and “the mystic chords of memory” — most of which Jay identified as both uniting Americans and separating us from our British “brethren.”
Yet these issues of identity appear not to be receding but rising in the Caucasus, Middle East, Africa and South Asia.
The Kurds, the Palestinians, the Baluch and many more seek their own nations. Taiwan’s secession is not recognized by China. The secession of Russian-speaking Donbass is not recognized by a U.S.-armed Ukraine, or by us.
As more and more people identify themselves by who they are, and are not, secessions of people from each other will continue.
These are not inconsequential matters. In 1939, the question of whether 300,000 Germans in a Polish-controlled city, Danzig, should be restored to German rule led to the worst war in the history of the world.
The peace of mankind in the 21st century may well depend upon our ability to accommodate this inexorable secessionist drive to some degree.
In June 1945, the U.N. had 50 members. It begins 2020 with 193.
Last week, Bougainville, a South Pacific island cluster of Papua New Guinea, voted 98%, in a nonbinding referendum for independence, to become the world’s newest nation. Papua New Guinea won its own independence from Australia when Gerald Ford was president.
And the beat goes on.
Tyler Durden
Tue, 12/17/2019 – 22:05 - WeWork Obtains $1.75 Billion Credit Line From Goldman Sachs
WeWork Obtains $1.75 Billion Credit Line From Goldman Sachs
Last week it was rumored that Goldman Sachs would provide a new line of credit to bailout Softbank’s money-losing investment in WeWork, thus saving Goldman’s money-losing bet on the struggling shared office space company.
Now it appears sources familiar with the situation have confirmed to Bloomberg that Goldman has provided a $1.75 billion line of credit as the first step in SoftBank’s pledge to put together $5 billion in debt financing for WeWork as part of its bailout package. The new credit line would free up $800 million in cash that WeWork had set aside for covenants on its previous credit line.
“We are pleased that WeWork and SoftBank Group Corp. have entered into a commitment letter with Goldman Sachs,” Erin Clark, a spokeswoman for WeWork, wrote in an email to Bloomberg.
“WeWork and Softbank are co-obligors on a senior-secured and unsecured basis, respectively.”
She added that WeWork didn’t post any cash collateral under the financing deal with Goldman.
Clark said the credit line could be tapped as early as next month, preventing WeWork for imminent death.
WeWork’s bond prices have responded positively to the bailouts from SoftBank and Goldman in the last month, have climbed 10 cents to 82.317 on the dollar, but that’s only after a plunge following a failed IPO in September.
Goldman, a top investor in WeWork, took an $80 million loss when WeWork valuations crashed from $39 billion to about $8 billion in under a year.
Goldman appears to be fully committed to supplying capital to the struggling company.
Sources said the new credit line would replace an existing one that totals $1.1 billion, allowing the company to free up working capital to cover lease payments and other expenses.
Before Goldman agreed to the new credit line with SoftBank for WeWork, the fund approached Mitsubishi UFJ, Sumimoto, and Mizuho banks in late November.
It was reported that all three banks balked at the idea to provide SoftBank with more capital so it could bailout WeWork unless it can develop a credible turnaround strategy.
At the end of the day, the Japanese banks passed on the deal to save WeWork as Goldman has arranged the credit line as part of WeWork’s rescue package.
Has WeWork become Silicon Valley’s biggest “zombie” unicorn?
Tyler Durden
Tue, 12/17/2019 – 21:45 - Krieger: "It's A Systemic Looting On A Massive Scale"
Krieger: “It’s A Systemic Looting On A Massive Scale”
Authored by Michael Krieger via Liberety Blitzkrieg blog,
The United States has historically bragged about its free and transparent markets. But what the Fed is doing today is pulling a dark curtain around the financing of this so-called free and transparent market. The public has no idea which Wall Street firms have received this $3 trillion or why they can’t borrow it elsewhere. This kind of obfuscation by the Federal Reserve could actually stimulate distrust in the U.S. banking system. The Fed admitted as much in its most recent Federal Open Market Committee (FOMC) minutes, writing that participation in the Fed’s loan program “could become stigmatized.”
– Wall Street on Parade: Is the Fed’s $3 Trillion in Loans to Trading Houses on Wall Street Legal?
The business model of Wall Street is fraud.
– Bernie Sanders
Financial services as currently structured is the most pernicious, predatory and corrupt industry on earth. Moreover, it’s the deliberately complex and opaque nature of the industry which then limits public debate when some problem arises and governments and central banks are called upon to take emergency measures to “save the system,” which is just a euphemism for enormous sums of corporate welfare being funneled to people and institutions who couldn’t survive otherwise.
It is systemic looting on a massive scale and the primary patrons of this ongoing and seemingly endless scheme are central banks. In the U.S. this means the Federal Reserve, which recently came back into the “market” with enormous new interventions in both the repo market and via renewed balance sheet expansion. I’ve read many of the smart takes on the repo crisis and still don’t feel confident I know precisely what’s going on. This is intentional.
Unelected central bankers throwing around billions upon billions gets almost no scrutiny, while impeachment theater dominates mass media 24/7. Which of these deserves more scrutiny?
This is how the public gets scammed. Look over here, while we loot the system quietly here.— Michael Krieger (@LibertyBlitz) December 16, 2019
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One of the main reasons big finance is able to pull off scam after scam in plain sight relates to the complexity, opacity and esoteric jargon associated with the industry. Repo is a perfect example. The market had a spasm in September and the Fed immediately rushed in with billions to bring the rate down without offering any transparency or a credible explanation of what was going on. Meanwhile, as the crisis continued over subsequent months and the central bank response grew larger and larger, we actually seem to be learning less with each passing day.
Instead of providing the public with the transparency it deserves, Fed officials run around pretending to be financial surgeons called in to perform an unexpected emergency operation on a patient after a freak accident. In reality, central banks are merely pumping billions into an already dead body while enriching connected and powerful individuals and institutions in the process. They know exactly what they’re doing and we need to stop pretending otherwise.
When you hear QE, the only thing that should pop into your mind is upward wealth transfer. In addition to keeping a pernicious system afloat, that’s all it does.
— Michael Krieger (@LibertyBlitz) December 17, 2019
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While I’m grateful to those who’ve spent time trying to thoughtfully explain the mechanics of the repo crisis and why it happened, I think that’s a sideshow at this point since nobody who really knows what’s going on is talking. Instead, we should focus on the absurd and unconscionable lack of transparency with regard to Federal Reserve actions. As far as I know, we have no idea which parties are taking up this expanded central bank funding. Think about how criminally insane that is. We have no idea if it’s driven by a troubled institution like Deutsche Bank, hedge funds with over-leveraged trades, treasury issuance, a combination of these factors, or something else.
We don’t know because they don’t want us to know, and they don’t want us to know because they don’t want the public thinking or talking about it. It’s at times like these when the totalitarian nature of central banking comes into crystal clear focus. What we have is government via unelected, unaccountable bankers. It’s the opposite of self-government, and understanding this simple fact blows apart all the myths about our so-called democracy and freedom. Nothing of the sort exists in reality, and when push comes to shove, you’re just a peasant living in an imperial oligarchy.
This should be the real takeaway from the Fed’s recent actions both in the repo market and via its rapid balance sheet expansion. The public’s not allowed to know anything about what’s really happening, and similar to the post-financial crisis period of a decade ago, the central bank comes in and conducts significant public policy to the tune of hundreds of billions of dollars with zero public debate.
How is it that we’re accepting this? Why isn’t the inequality obsessed left commenting more aggressively on the central bank mechanism of upward wealth transfer, which is precisely what’s been happening for so long? Why push for a wealth tax while leaving the primary instrument of upward wealth transfer (central banking) completely unchecked?
It’d be one thing if the Fed came out and detailed exactly what the problem is and told us specifically who’s using the funds and why. Then we could actually have a conversation about whether this is appropriate or, more likely, a gigantic moral hazard financially rewarding various unscrupulous industry players.
Don’t think for a moment that huge sums of money aren’t being made from these Fed actions. When the spigots come on out of nowhere to the tune of hundreds of billions of dollars someone is benefitting tremendously and it’s not you.
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Tyler Durden
Tue, 12/17/2019 – 21:25 - 92% Of Americans Feel Their Freedom Is Threatened
92% Of Americans Feel Their Freedom Is Threatened
Americans are most afraid their First Amendment rights could be taken away, according to a new poll by Harris Poll/Purple Project, which surveyed 2,002 people nationwide from November 18-20, 2019. Overall, Statista’s Maria Vultaggio notes that 92 percent were concerned their rights were being jeopardized, USA Today wrote, citing the poll. Americans also fear their right to bear arms and their right to equal justice are in danger.
You will find more infographics at Statista
The poll comes one week after it was revealed by the Foundation for Individual Rights in Education (FIRE) that at least 6.4 million students at nearly 500 campuses in the U.S. have experienced their freedom of speech being restricted. FIRE discovered this through analyzing the written policies of the schools and coding them with a grade of red, yellow or green. Nearly a quarter of schools received a red rating, meaning speech was most restricted at these schools.
The finding was worrying for Laura Beltz, the lead author of the study.
“Colleges should serve as centers of intellectual debate and inquiry, but if you have policies telling you can’t protest unless you submit a request two weeks in advance, or you can’t use words that other people find offensive, that ends up being impossible,” she told The Epoch Times.
Tyler Durden
Tue, 12/17/2019 – 21:05 - Everything You Wanted To Know About Impeachment (But Were Afraid To Ask On Twitter)
Everything You Wanted To Know About Impeachment (But Were Afraid To Ask On Twitter)
Impeachment can be confusing…
But The Babylon Bee is here with an explainer so you will know how the process works and what it takes for Dems to snap their fingers together and make Trump disappear in a cloud of dust.
What is impeachment?
It’s the official, constitutional method for screaming at the sky because Trump is president.
Why is Trump being impeached?
Trump has committed some very serious offenses, from not being a Democrat to being a Republican. He also won the 2016 election, which rises to the level of high crimes and misdemeanors. He also restored the celebration of Christmas after eight years of winter with no Christmas under Obama. This drove Dems up a wall so they drummed up some charges against him.
Why didn’t Democrats include any criminal offenses in the articles of impeachment?
There were just so many of them, it was hard to pick one. So, instead of laying out actually impeachable offenses, the Democrats summarized it all with two main articles of impeachment: 1.) Trump is president. 2.) TRUMP IS PRESIDENT.
What does it take to remove the president from office?
Faith, trust, and pixie dust.
Will Trump be removed from office?
Lol.
If we believe in ourselves and try hard, and Trump is removed, Hillary Clinton becomes president, right?
Actually, Mike Pence would become president, basically making the United States into a Handmaid’s Tale-style dystopia.
What happens if Trump is impeached in the House but acquitted in the Senate?
Democrats don’t get the big prize, but they each get a complimentary copy of Impeachment: The Board Game.
Once the House votes to officially impeach President Trump, what happens next?
Trump wins the 2020 election.
* * *
Tyler Durden
Tue, 12/17/2019 – 20:45 - VIX Options-Whale '50 Cent' Re-Emerges As New Short-Vol ETF Appears
VIX Options-Whale ’50 Cent’ Re-Emerges As New Short-Vol ETF Appears
The last few years of constant vol suppression by central banks worldwide has been greeted by the emergence of a veritable bestiary of options whales, characterized by their respective trading patterns…
Perhaps the most infamous of them all is “50-cent” – so called for the price at which he is willing to buy VIX calls as VIX itself collapsed (as we have detailed here, here, and here)…
And, as Bloomberg reports, today saw his huge footprint re-appear as someone snapped up roughly 130,000 January $22 calls on the index for about 50 cents each.
Source: Bloomberg
“50 Cent” first came to the market’s attention by buying huge amounts of VIX calls during the market turmoil through 2017 and early 2018. The trading pattern reappeared last August as the S&P 500 was locked in a trading range with implied volatility trading around its highest levels of the year.
The familiar price point for buying VIX calls “will certainly lead to investors believing ‘50 Cent’ is back,” Chris Murphy, the co-head of derivatives strategy at Susquehanna Susquehanna Financial Group, said in a research note.
With the options maturing on January 22nd, there are still plenty of catalysts to trigger a spike in vol and a big payout for ’50-cent’ – including this week’s op-ex, the partial trade-deal falling apart, year-end repo/liquidity issues, and potentially bad news from the World Economic Forum in Davos early next year.
But, as 50-cent buys vol cheap in anticipation of a spike, another financial start-up appears to have gone full Einsteinian madness.
Bloomberg reports that Volatility Shares LLC has applied to Cboe Global Markets Inc. to register an exchange-traded fund that would give investors the ability to short futures on the Cboe Volatility Index, according to a new filing.
This is nothing less than a replacement for the XIV product that created volmageddon in February 2018 as vol spiked and the short-vol-ETN crashed and died…
Source: Bloomberg
Bloomberg reports that the new ETF’s design changes some of the attributes that may have contributed to the flame out of XIV.
“What happened on Feb. 5 was kind of a problem that I think the original architects of those products hadn’t foreseen,” said Barton.
“That left a gap in the markets, and we were asking people to provide a solution. Nobody stepped up, so we did the research and leg work and hope to bring that solution to market.”
SVIX would track the Short VIX Futures Index, whose backtest suggests a loss of just 30% on Feb. 5, compared to the 96% retreat in the indicative value of XIV.
However, this all has the smell of yet another penny-picking trade that will go well… until it doesn’t.
After XIV’s implosion, Devesh Shah, who helped invent the VIX index, said he didn’t know why these products existed — while predicting that a successor would soon emerge.
“And what’s going to happen as a result of this? Nothing, other than in a few months’ time someone’s going to come up with a new XIV, and everyone’s going to start putting money into that,” he said back in February 2018.
“That’s OK, that’s how the world goes.”
He was right, and simply put, if at first you don’t succeed in blowing up the world with leveraged short vol bets, try, try again…
Tyler Durden
Tue, 12/17/2019 – 20:25 - WA State Steps Up To Defend Female Athletes In Trans Debate
WA State Steps Up To Defend Female Athletes In Trans Debate
Authored by Kelli Ballard via LibertyNation.com,
Competition is the name of the game, but what constitutes fair rivalry? With today’s progressives trying to change everything, including how genders should be addressed, who is in the right when it comes to females in sports and transgenders competing against them? As Liberty Nation’s Onar Am said,
“Just as you need different weight classes in boxing or wrestling to make the competition fair, you also need a separate category for women so that they have a chance to compete on equal biological terms.”
Thankfully, at least one politician is aiming to correct this matter: Rep. Bill Klippert. The Republican has filed in the Washington state legislature House Bill 2201, which would prevent biological males who identify as females from competing in some women’s sports.
According to the bill, however, this exclusion would not necessarily apply to all female sports. It is designed to target those activities intended only for female students, and it must be an individual competition such as track.
“I’m running this in support of female athletes,” Klippert said, “so they can compete against each other and not have to compete against male athletes who have different hormones flowing through their veins, which gives them much more muscle capacity.”
What’s surprising is that this legislation has been proposed in liberal state such as Washington. What’s not surprising is the backlash it’s receiving from LGBTQ activist groups. One such, PFLAG, claimed the bill is “at its core an attempt to invalidate transgender and gender non-binary identity.”
Klippert’s bill is meant to protect natural-born female rights, not dehumanize transgender people as PFLAG implies. Using that logic, allowing transgenders to compete against females would be an “attempt to invalidate” the latter. PFLAG continued its argument, saying there is no evidence that transgender athletes cause any “serious danger” to the sports in which they participate. That would depend on how “danger” is defined and interpreted. Physical? Emotional? Extinction to female competitive sports?
Without enumerating the biological differences between males and females, the trend of born-males winning titles in women’s sports should be proof enough that the odds are stacked in their favor when competing against natural-born females. The separation of sports by gender was done so that women could compete on a level playing field.
PFLAG insisted transgender people deserve their constitutional rights, but what about those of natural-born females? “Transgender people are people, non-binary people are people, they are entitled to a recognition of who they are and to have their civil rights and basic dignity honored,” the organization asserted. The question is, do their rights supersede others’?
Save Women’s Sports produced an article on its website entitled “Male Athletes Are Taking Over Women’s Cycling.” In the piece, Mary Verrandeaux, a member of the 1985 U.S. National Team, said:
“It is without a doubt that allowing men, who identify as women, to continue to compete in women’s categories is the end of women’s sports. Women’s opportunities, records, scholarships, and championships are now being awarded to biological men. This has already destroyed the sanctified intent of women competing against other women – not women competing against biological men who ‘identify as women.’”
Recognizing and respecting people for who they are – biologically or emotionally — does not mean trouncing other individuals’ rights. Here’s a little food for thought. If transgenders who identify as females can’t understand the ‘danger’ they pose to the world of women’s sports, then how can they truly claim to be female? If they cannot identify with the challenges facing natural-born females as they usurp their titles and trophies, how can they claim womanhood?
Save Women’s Sports summarized the issue:
“This is the beginning of the end for women’s sports. We cannot allow this abuse of female athletes and mockery of women’s sports to continue. It is not bigotry to defend biology, and it is not hate speech to defend your rights.”
Although House Bill 2201 has been only pre-filed, it is at least a step in the right direction. It is hoped more Washington state lawmakers will join in its support. It must be introduced in the House before it can move to a committee.
Tyler Durden
Tue, 12/17/2019 – 20:05 - Supreme Court Lets Lower Court Ruling Stand Allowing Homeless To Sleep On Sidewalk
Supreme Court Lets Lower Court Ruling Stand Allowing Homeless To Sleep On Sidewalk
The Supreme Court on Monday rejected to hear a major case concerning homelessness, thus allowing a lower court’s ruling to stand allowing homeless people to sleep on sidewalks or in public parks if there are no other options for shelter.
The highest court in the land gave no explanation for their decision to deny the appeal, which is standard practice. It’s possible they may have considered the dispute moot, according to the Los Angeles Times.
Mike Westfall stands next to his tent and his bike. Santa Rosa, CA The 9th circuit federal court of appeals agreed with lawyers for the homeless, who argued in a case out of Boise, Idaho that prosecuting vagrants for sleeping on sidewalks violates the 8th Amendment’s ban on cruel and unusual punishment in cases where the city has failed to provide adequate shelter, reports the Times.
Lawyers for the homeless noted that in 2014, Boise announced a “shall not enforce” policy regarding misdemeanor violations against camping or sleeping in public when no shelter has been provided. While the city thought that would end the litigation, the 9th Circuit proceeded to issue a broad ruling last year.
The outcome was a significant victory for homeless activists and a setback for city officials in California and other Western states who argued the ruling from the 9th U.S. Circuit Court of Appeals undercut their authority to regulate encampments on the sidewalks. The 9th Circuit had agreed with lawyers for the homeless who argued that prosecuting people for sleeping on the sidewalks violated the 8th Amendment’s ban on cruel and unusual punishment if a city failed to provide adequate shelter.
A city ordinance “violates the 8th Amendment insofar as it imposes criminal sanctions against homeless individuals for sleeping outdoors on public property, when no alternative shelter is available to them,” said the ruling by the 9th Circuit, which has jurisdiction over California and eight other Western states. –Los Angeles Times
Officials in Los Angeles say the court’s decision leaves the law unclear about what actions local officials can take. They joined with the city of Boise to ask the Supreme Court to hear the case, which was “never an attempt to criminalize the homeless; rather, it was a pursuit of a legal framework that is clear — in comparison to a status quo that is ambiguous and confusing,” according to LA County Supervisor Mark Ridley-Thomas.
California’s growing homeless emergency. Figures as of August 2019 (via the Daily Mail) “Letting the current law stand handicaps cities and counties from acting nimbly to aid those perishing on the streets, exacerbating unsafe and unhealthy conditions that negatively affect our most vulnerable residents,” he added.
According to LA Mayor Eric Garcetti, “homelessness won’t be solved by moving people from one street to another. Our focus will remain on providing services to save lives, keeping our neighborhoods clean and healthy, opening shelters to help get people indoors more quickly, and building permanent units to keep them under a roof for good.”
Several West Coast cities, including Los Angeles, urged the Supreme Court to take up the appeal of Boise vs. Martin, with lawyers for Boise writing that the “creation of a de facto constitutional right to live on sidewalks and in parks will cripple the ability of more than 1,600 municipalities in the 9th Circuit to maintain the health and safety of their communities.”
There are approximately 130,000 homeless people across California.
“Nothing in the Constitution … requires cities to surrender their streets, sidewalks, parks, riverbeds and other public areas to vast encampments,” argued the lawyers. The Times notes that the appeal was filed by Ted Olson and Theane Evangelis, partners at LA-based Gibson Dunn.
A right to sleep on the sidewalk is not new for Los Angeles or city officials. In 2006, the 9th Circuit handed down a similar ruling that said the city may not enforce laws against sleeping in public places. Rather than appeal, the city negotiated a settlement with lawyers for homeless people in which it agreed to not enforce such laws from 9 p.m. to 6 a.m.
The Supreme Court has previously relied on the 8th Amendment to limit the punishment for some crimes, but it is rare for judges to strike down a criminal law itself as cruel and unusual punishment. The 9th Circuit cited a 1962 decision in Robinson vs. California, which struck down part of a state law that “made the status of narcotic addiction a criminal offense.”
Judge Marsha Berzon said this principle extends to homelessness. “Just as the state may not criminalize the state of being homeless in public places,” she wrote, “the state may not criminalize conduct that is an unavoidable consequence of being homeless — namely sitting, lying or sleeping on the streets.” –Los Angeles Times
LA City Attorney Mike Feuer urged the court to review the 9th Circuit’s opinion, writing “The lack of clarity of the Boise decision, combined with its sweeping rationale, makes more difficult the efforts of Los Angeles to balance the needs of its homeless residents with the needs of everyone who uses our public spaces.”
Feuer wanted to know whether the city needs to make shelters available for all 36,000 homeless residents “before taking enforcement action against a single unsheltered individual who refuses an available shelter bed in one of the city’s regional shelters, just because shelters at the opposite end of the city are full.”
Meanwhile, the California city of Santa Rosa is about to unveil emergency proposals to shelter homeless people at local fairgrounds. The proposal will allow some of those currently living in a mile-long camp along the Joe Rodota Trail – as well as the rest of Sonoma County’s 3,000 or so homeless to move into the fairgrounds, according to The Press Democrat.
Tyler Durden
Tue, 12/17/2019 – 19:45 - Bad Capitalism And Good Socialism
Bad Capitalism And Good Socialism
Authored by Walter Block via The Mises Institute,
Is socialism the enemy of the civilized order? It depends on what kind of socialism we are discussing.
There are several varieties, not only one. If it is the version calling for government ownership and control of all the means of production, the complete nationalization of all industries, then yes, socialism is the work of the devil. All we need do to demonstrate this is to mention economic basket cases like Venezuela, East Germany, Maoist China and the U.S.S.R. They produced dire poverty and the deaths of millions of innocent people.
There is a second, just as historically accurate a definition of socialism as the first. It is predicated on the Marxian nostrum: “From each according to his ability, to each according to his need.” If this goal is attained on a coercive basis, then, yet again, this compulsory egalitarianism is surely uncivilized. It amounts to stealing from the innocent rich. But suppose people agree to live under this principle? Ayn Rand might not like this too much, but, if it is truly voluntary, then instead of being incompatible with civilized principles, it is a paradigmatic case of them. That is, the rich agree to be “expropriated” in favor of the poor.
Are there any such institutions that actually flourish? Here are a few: the convent, monastery, kibbutz, commune, syndicalist association, cooperative. I teach at a Jesuit school, and all members of this order subscribe to the “from each, to each” philosophy. True, kibbutzim were initially subsidized by the state of Israel and are now a shadow of their former selves, and Robert Owen’s commune in New Harmony, Ind., is no longer in operation. But neither does every business last forever. Then there is the average American family. It, too, lives according to this Marxian doctrine. The 3-year-old girl eats, gets toys and is clothed not in accordance with her ability to earn income, but based on her needs.
Capitalism is likewise divided into several varieties. If it is free-market capitalism we are contemplating, or as near to that system as we can approach in this vale of tears, then this—along with voluntary socialism—is the very foundation of the civilized order. All boats rise on a tide of profit maximization and untrammeled entrepreneurship, as long as personal and property rights are respected. The experiences of places with expansive economic freedom, such as the U.S., Switzerland, Hong Kong, Singapore—and yes, Bernie, Scandinavia too—give ample testimony to this claim.
Yet under the veneer of economic freedom, markets have their dark side, too: crony capitalism. Uber is brutalized by the taxi industry in the name of protecting the public; young women who braid hair are hassled by licensed beauticians; domestic manufacturers lust after protective tariffs; farm states tried to outlaw dyeing margarine yellow; labor unions champion minimum-wage laws to price their unskilled competitors out of the market. As Adam Smith wisely said, under this type of capitalism, “people of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.”
No, not all versions of socialism are the enemy of humanity and decency, nor are all types of capitalism their friend. It all depends on which variety of each we are discussing.
Tyler Durden
Tue, 12/17/2019 – 19:25 - "You Have Found NOTHING!": Trump Sends Scathing Letter To Pelosi Slamming "Illegal Attempted Coup"
“You Have Found NOTHING!”: Trump Sends Scathing Letter To Pelosi Slamming “Illegal Attempted Coup”
In a six-page letter to Speaker Pelosi, President Trump rages against The Democrats’ “attempted coup,” blasting that “there was more due process at The Salem Witch Trials.”
“This is nothing more than an illegal, partisan attempted coup that will, based on recent sentiment, badly fail at the voting both. You are not just after me, as President, you are after the entire Republican Party,” Trump wrote.
“History will judge you harshly as you proceed with this impeachment charade.”
“I have no doubt the American people will hold you and the Democrats fully responsible in the upcoming 2020 election. They will not soon forgive your perversion of justice and abuse of power,” he added.
The letter comes on the eve of the House vote on two articles of impeachment against Trump for alleged abuse of power and obstruction of Congress, which is widely expected to approve the articles along party lines.
Full letter below (emphasis ours):
Dear Madam Speaker:
I write to express my strongest and most powerful protest against the partisan impeachment crusade being pursued by the Democrats in the House of Representatives. This impeachment represents an unprecedented and unconstitutional abuse of power by Democrat Lawmakers, unequaled in nearly two and a half centuries of American legislative history.
The Articles of Impeachment introduced by the House Judiciary Committee are not recognizable under any standard of Constitutional theory, interpretation, or jurisprudence. They include no crimes, no misdemeanors, and no offenses whatsoever. You have cheapened the importance of the very ugly word, impeachment!
By proceeding with your invalid impeachment, you are violating your oaths of office, you are breaking your allegiance to the Constitution, and you are declaring open war on American Democracy. You dare to invoke the Founding Fathers in pursuit of this election-nullification scheme—yet your spiteful actions display unfettered contempt for America’s founding and your egregious conduct threatens to destroy that which our Founders pledged their very lives to build. Even worse than offending the Founding Fathers, you are offending Americans of faith by continually saying “I pray for the President,” when you know this statement is not true, unless it is meant in a negative sense. It is a terrible thing you are doing, but you will have to live with it, not I!
Your first claim, “Abuse of Power,” is a completely disingenuous, meritless, and baseless invention of your imagination. You know that I had a totally innocent conversation with the President of Ukraine. I then had a second conversation that has been misquoted, mischaracterized, and fraudulently misrepresented. Fortunately, there was a transcript of the conversation taken, and you know from the transcript (which was immediately made available) that the paragraph in question was perfect. I said to President Zelensky: “I would like you to do us a favor, though, because our country has been through a lot and Ukraine knows a lot about it.” I said do us a favor, not me, and our country, not a campaign. I then mentioned the Attorney General of the United States. Every time I talk with a foreign leader, I put America’s interests first, just as I did with President Zelensky.
You are turning a policy disagreement between two branches of government into an impeachable offense—it is no more legitimate than the Executive Branch charging members of Congress with crimes for the lawful exercise of legislative power.
You know full well that Vice President Biden used his office and $1 billion dollars of U.S. aid money to coerce Ukraine into firing the prosecutor who was digging into the company paying his son millions of dollars. You know this because Biden bragged about it on video. Biden openly stated: “I said, ‘I’m telling you, you’re not getting the billion dollars’ …I looked at them and said: ‘I’m leaving in six hours. If the prosecutor is not fired, you’re not getting the money.’ Well, son of a bitch. He got fired.”
Even Joe Biden admitted just days ago in an interview with NPR that it “looked bad.” Now you are trying to impeach me by falsely accusing me of doing what Joe Biden has admitted he actually did.
President Zelensky has repeatedly declared that I did nothing wrong, and that there was No Pressure. He further emphasized that it was a “good phone call,” that “I don’t feel pressure,” and explicitly stressed that “nobody pushed me.” The Ukrainian Foreign Minister stated very clearly: “I have never seen a direct link between investigations and security assistance.” He also said there was “No Pressure.” Senator Ron Johnson of Wisconsin, a supporter of Ukraine who met privately with President Zelensky, has said: -At no time during this meeting…was there any mention by Zelensky or any Ukrainian that they were feeling pressure to do anything in return for the military aid.” Many meetings have been held between representatives of Ukraine and our country. Never once did Ukraine complain about pressure being applied—not once!
Ambassador Sondland testified that I told him: “No quid pro quo. I want nothing. I want nothing. I want President Zelensky to do the right thing, do what he ran on.”
The second claim, so-called “Obstruction of Congress,” is preposterous and dangerous. House Democrats are trying to impeach the duly elected President of the United States for asserting Constitutionally based privileges that have been asserted on a bipartisan basis by administrations of both political parties throughout our Nation’s history. Under that standard, every American president would have been impeached many times over. As liberal law professor Jonathan Turley warned when addressing Congressional Democrats: “I can’t emphasize this enough… if you impeach a president, if you make a high crime and misdemeanor out of going to the courts, it is an abuse of power. It’s your abuse of power. You’re doing precisely what you’re criticizing the President for doing.”
Everyone, you included, knows what is really happening. Your chosen candidate lost the election in 2016, in an Electoral College landslide (306-227), and you and your party have never recovered from this defeat. You have developed a full-fledged case of what many in the media call Trump Derangement Syndrome and sadly, you will never get over it! You are unwilling and unable to accept the verdict issued at the ballot box during the great Election of 2016. So you have spent three straight years attempting to overturn the will of the American people and nullify their votes. You view democracy as your enemy!
Speaker Pelosi, you admitted just last week at a public forum that your party’s impeachment effort has been going on for “two and a half years,” long before you ever heard about a phone call with Ukraine. Nineteen minutes after I took the oath of office, the Washington Post published a story headlined, “The Campaign to Impeach President Trump Has Begun.” Less than three months after my inauguration, Representative Maxine Waters stated, “I’m going to fight every day until he’s impeached.” House Democrats introduced the first impeachment resolution against me within months of my inauguration, for what will be regarded as one of our country’s best decisions, the firing of James Comey (see Inspector General Reports)—who the world now knows is one of the dirtiest cops our Nation has ever seen. A ranting and raving Congresswoman, Rashida Tlaib, declared just hours after she was sworn into office, “We’re gonna go in there and we’re gonna impeach the motherf’***r.” Representative Al Green said in May, -I’m concerned that if we don’t impeach this president, he will get re-elected.” Again, you and your allies said, and did, all of these things long before you ever heard of President Zelensky or anything related to Ukraine. As you know very well, this impeachment drive has nothing to do with Ukraine, or the totally appropriate conversation I had with its new president. It only has to do with your attempt to undo the election of 2016 and steal the election of 2020!
Congressman Adam Schiff cheated and lied all the way up to the present day, even going so far as to fraudulently make up, out of thin air, my conversation with President Zelensky of Ukraine and read this fantasy language to Congress as though it were said by me. His shameless lies and deceptions, dating all the way back to the Russia Hoax, is one of the main reasons we are here today.
You and your party are desperate to distract from America’s extraordinary economy, incredible jobs boom, record stock market, soaring confidence, and flourishing citizens. Your party simply cannot compete with our record: 7 million new jobs; the lowest-ever unemployment for African Americans, Hispanic Americans, and Asian Americans; a rebuilt military; a completely reformed VA with Choice and Accountability for our great veterans; more than 170 new federal judges and two Supreme Court Justices; historic tax and regulation cuts; the elimination of the individual mandate; the first decline in prescription drug prices in half a century; the first new branch of the United States Military since 1947, the Space Force; strong protection of the Second Amendment; criminal justice reform; a defeated ISIS caliphate and the killing of the world’s number one terrorist leader, al-Baghdadi; the replacement of the disastrous NAFTA trade deal with the wonderful USMCA (Mexico and Canada); a breakthrough Phase One trade deal with China; massive new trade deals with Japan and South Korea; withdrawal from the terrible Iran Nuclear Deal; cancellation of the unfair and costly Paris Climate Accord; becoming the world’s top energy producer; recognition of Israel’s capital, opening the American Embassy in Jerusalem, and recognizing Israeli sovereignty over the Golan Heights; a colossal reduction in illegal border crossings, the ending of Catch-and-Release, and the building of the Southern Border Wall—and that is just the beginning, there is so much more. You cannot defend your extreme policies—open borders, mass migration, high crime, crippling taxes, socialized healthcare, destruction of American energy, late-term taxpayer-funded abortion, elimination of the Second Amendment, radical far-left theories of law and justice, and constant partisan obstruction of both common sense and common good.
There is nothing I would rather do than stop referring to your party as the Do-Nothing Democrats. Unfortunately, I don’t know that you will ever give me a chance to do so.
After three years of unfair and unwarranted investigations, 45 million dollars spent, 18 angry Democrat prosecutors, the entire force of the FBI, headed by leadership now proven to be totally incompetent and corrupt, you have found NOTHING! Few people in high position could have endured or passed this test. You do not know, nor do you care, the great damage and hurt you have inflicted upon wonderful and loving members of my family. You conducted a fake investigation upon the democratically elected President of the United States, and you are doing it yet again.
There are not many people who could have taken the punishment inflicted during this period of time, and yet done so much for the success of America and its citizens. But instead of putting our country first, you have decided to disgrace our country still further. You completely failed with the Mueller report because there was nothing to find, so you decided to take the next hoax that came along, the phone call with Ukraine—even though it was a perfect call. And by the way, when I speak to foreign countries, there are many people, with permission, listening to the call on both sides of the conversation.
You are the ones interfering in America’s elections. You are the ones subverting America’s Democracy. You are the ones Obstructing Justice. You are the ones bringing pain and suffering to our Republic for your own selfish personal, political, and partisan gain.
Before the Impeachment Hoax, it was the Russian Witch Hunt. Against all evidence, and regardless of the truth, you and your deputies claimed that my campaign colluded with the Russians—a grave, malicious, and slanderous lie, a falsehood like no other. You forced our Nation through turmoil and torment over a wholly fabricated story, illegally purchased from a foreign spy by Hillary Clinton and the DNC in order to assault our democracy. Yet, when the monstrous lie was debunked and this Democrat conspiracy dissolved into dust, you did not apologize. You did not recant. You did not ask to be forgiven. You showed no remorse, no capacity for self-reflection. Instead, you pursued your next libelous and vicious crusade—you engineered an attempt to frame and defame an innocent person. All of this was motivated by personal political calculation. Your Speakership and your party are held hostage by your most deranged and radical representatives of the far left. Each one of your members lives in fear of a socialist primary challenger – this is what is driving impeachment. Look at Congressman Nadler’s challenger. Look at yourself and others. Do not take our country down with your party.
If you truly cared about freedom and liberty for our Nation, then you would be devoting your vast investigative resources to exposing the full truth concerning the FBI’s horrifying abuses of power before, during, and after the 2016 election—including the use of spies against my campaign, the submission of false evidence to a FISA court, and the concealment of exculpatory evidence in order to frame the innocent. The FBI has great and honorable people, but the leadership was inept and corrupt. I would think that you would personally be appalled by these revelations, because in your press conference the day you announced impeachment, you tied the impeachment effort directly to the completely discredited Russia Hoax, declaring twice that “all roads lead to Putin,” when you know that is an abject lie. I have been far tougher on Russia than President Obama ever even thought to be.
Any member of Congress who votes in support of impeachment – against every shred of truth, fact, evidence, and legal principle – is showing how deeply they revile the voters and how truly they detest America’s Constitutional order. Our Founders feared the tribalization of partisan politics, and you are bringing their worst fears to life.
Worse still, I have been deprived of basic Constitutional Due Process from the beginning of this impeachment scam right up until the present. I have been denied the most fundamental rights afforded by the Constitution, including the right to present evidence, to have my own counsel present, to confront accusers, and to call and cross-examine witnesses, like the so-called whistleblower who started this entire hoax with a false report of the phone call that bears no relationship to the actual phone call that was made. Once I presented the transcribed call, which surprised and shocked the fraudsters (they never thought that such evidence would be presented), the so-called whistleblower, and the second whistleblower, disappeared because they got caught, their report was a fraud, and they were no longer going to be made available to us. In other words, once the phone call was made public, your whole plot blew up, but that didn’t stop you from continuing.
More due process was afforded to those accused in the Salem Witch Trials.
You and others on your committees have long said impeachment must be bipartisan—it is not. You said it was very divisive—it certainly is, even far more than you ever thought possible—and it will only get worse!
This is nothing more than an illegal, partisan attempted coup that will, based on recent sentiment, badly fail at the voting booth. You are not just after me, as President, you are after the entire Republican Party. But because of this colossal injustice, our party is more united than it has ever been before. History will judge you harshly as you proceed with this impeachment charade. Your legacy will be that of turning the House of Representatives from a revered legislative body into a Star Chamber of partisan persecution.
Perhaps most insulting of all is your false display of solemnity. You apparently have so little respect for the American People that you expect them to believe that you are approaching this impeachment somberly, reservedly, and reluctantly. No intelligent person believes what you are saying. Since the moment I won the election, the Democrat Party has been possessed by Impeachment Fever. There is no reticence. This is not a somber affair. You are making a mockery of impeachment and you are scarcely concealing your hatred of me, of the Republican Party, and tens of millions of patriotic Americans. The voters are wise, and they are seeing straight through this empty, hollow, and dangerous game you are playing.
I have no doubt the American people will hold you and the Democrats fully responsible in the upcoming 2020 election. They will not soon forgive your perversion of justice and abuse of power.
There is far too much that needs to be done to improve the lives of our citizens. It is time for you and the highly partisan Democrats in Congress to immediately cease this impeachment fantasy and get back to work for the American People. While I have no expectation that you will do so, I write this letter to you for the purpose of history and to put my thoughts on a permanent and indelible record.
One hundred years from now, when people look back at this affair, I want them to understand it, and learn from it, so that it can never happen to another President again.
* * *
No punches pulled there, for sure.
Tyler Durden
Tue, 12/17/2019 – 19:10 - First Made-In-China Aircraft Carrier Enters Active Service
First Made-In-China Aircraft Carrier Enters Active Service
China’s second aircraft carrier, the first domestically built one, called the Shandong, was delivered and commissioned by President Xi Jinping, also general secretary of the Communist Party of China Central Committee and chairman of the Central Military Commission, at a commissioning ceremony in Shandong, an eastern Chinese province on the Yellow Sea, on Tuesday, reported China News Service.
China’s PLAN commissions it’s 2nd (1st locally built) aircraft carrier into service at near Sanya in Hainan island. Pennant no. 17 is named Shandong (山东) and looks like it will be assigned to the South Sea Fleet pic.twitter.com/W5ebvRRdEZ
— Mike Yeo 杨启铭 (@TheBaseLeg) December 17, 2019
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The commissioning of the new aircraft carrier was a significant milestone for China as it expands its efforts to become a dominant superpower in the Indo-Pacific region.
China has now entered an elite circle of superpowers that operate multiple carriers, including the US, the UK, and Italy.
China’s 2nd aircraft carrier officially commissioned. Named Shandong after the province. If every Chinese province gets an aircraft carrier named after, it will be 34 aircraft carrier 😬 pic.twitter.com/UrAHjQxG41
— Carl Zha (@CarlZha) December 17, 2019
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Before Shandong, the People’s Liberation Army Navy (PLAN) operated one aircraft carrier called the Liaoning, which was built on a Soviet-era vessel, refitted as an aircraft carrier and launched into service back in 2012.
Construction of Shandong began in 2013 and was launch at the Dalian Shipyard in 2017. By 2018, the vessel started several sea trials, and it wasn’t until late 2019 that the ship completed eight tests, including transiting the Taiwan Strait and the South China Sea.
WATCH: Xi Jinping tours China’s first domestically-made aircraft carrier pic.twitter.com/gcftZ6zQ4I
— QuickTake by Bloomberg (@QuickTake) December 17, 2019
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Shandong has a displacement of 40,000-60,000 tons with a ski-jump flight deck similar to Liaoning. Significant improvements in layout design allow the new aircraft carrier to carry 36 J-15 fighter jets, compared to the Liaoning’s 24.
China is the first Asian country since World War II to operate a domestically built aircraft carrier.
Military expert Song Zhongping told the South China Morning Post that Shandong will be stationed Sanya, a port city located on the southern end of China’s Hainan Island.
Zhongping said: “The South China Sea offers ample scope for Chinese aircraft carriers to show their capabilities. It is also the area where the PLA needs to prepare for military struggles.”
He added that Shandong “might be placed under the Southern Theatre Command for joint operations in the event of war in the South China Sea.”
China’s rapid modernization effort of its military in the last decade has caused concern among its neighbors, some of which are strategic allies of the US.
Japanese Defence Minister Taro Kono, on Monday, criticized China for its attempt to reconfiguring the balance of powers in the East and South China seas.
Kono warned that Japan was “also concerned about China’s rapid enhancement of its military power without transparency, including its nuclear and missile capabilities.”
China’s ascension to become a global superpower could be realized by 2030. The economic war waged by the US on China has been an attempt to limit the rise of China, but if that fails, it seems that a trade war could transform into a shooting war somewhere in the South China Sea.
Tyler Durden
Tue, 12/17/2019 – 19:05 - US Official Gold Reserves Auditor Caught Lying
US Official Gold Reserves Auditor Caught Lying
Submitted by Jan Nieuwenhuijs of Voima Gold
In my previous post, from March 2018, on the audits of US official gold reserves, I have exposed that during the audit procedures of the US official gold reserves from 1974 through 2008, repeatedly audit staff deviated from the auditing protocol, while internal control meant to prevent this was failing. Many audits and assay reports have been destroyed. For decades a significant share of the metal was excluded from verifications for no apparent reason. And, the US government went to great lengths in withholding information and spreading false information about the audits, among other findings in documents obtained through Freedom of Information Act (FOIA) requests. All in all, these findings made me question the integrity of the auditor.
After my last publication, I have obtained more documents from the US Treasury through FOIA requests, which expose another falsehood that puts the auditor in an even more peculiar position. In conflict with the audit protocol, the permanent seals of the vault compartments have been broken, time and again. In addition, the auditor has lied about these events, and when confronted, it’s unable to explain its actions. By now, I have lost faith in the auditor fully.
Prologue
It’s been a very long investigative journey that has led me to make bold statements, such as the ones above, about the auditor of the world’s largest gold holding. I wouldn’t claim anything of this magnitude if I didn’t thoroughly do my homework and research every single possibility that could have caused the auditor to have accidentally spread inaccurate material, including asking the auditor for an explanation.
If any of their statements appeared to be false, surely, they would be able to explain what I was missing. The head auditor said during a congressional hearing in 2011 (source video 42:50):
Transparency is our business.
Who would disagree? The US official gold reserves, weighing over 8,000 metric tonnes, deserve nothing less than an accurate audit.
My journey started in 2014, when I first discovered—in contrast to what I was accustomed to reading on blogs and in newspapers—that the US official gold reserves are audited every year. I published an article on my discoveries, titled A First Glance At US Official Gold Reserves Audits, which was basically a summary of all publicly available documents about the audits. Logically, these documents present a narrative that looks to be credible at the surface, but I found some questions left unanswered, and wrote in my article “this post will be part one of a series.” (Little did I know what I got myself into.) Given the importance of the subject, I intended to submit FOIA requests at the US government, in an open-minded attempt to have my concerns removed.
Since 2014 I have been prosecuting the US government. I have emailed staff of all related institutions—the US Treasury, The Office of Inspector General of the Treasury, the US Mint, and National Archives—that were initially replied, but as I got closer to the details, ceased altogether. I have submitted several dozen FOIA requests to all related institutions, some of which were honored, some not. In search of answers, I repeatedly called the Inspector General. In one of those calls, my contact simply hung up while I was talking. This incident is emblematic of this whole investigation.
On one occasion, the Mint wrote me a specific FOIA request would cost $3,145 “based on an estimate of 1,200 pages of responsive documentation and the duplication costs associated with the requested documents. This estimate also includes 40 hours of estimated search time and 8 hours of estimated review time…” The costs seemed outrages to me, but I got financed through a crowdfunding campaign and paid the Mint. A few months late(r), I received 223 redacted pages that contained 68 pages of reports I didn’t ask for and 21 pages that were copied twice. Effectively, I got 134 pages for $3,145. After some pressure on the Mint, they agreed the costs had been estimated too high, and I got the full amount refunded. (And I ordered my crowdfunding platform to refund all my donors.) The barrier of the costs was used to keep me at bay. To no avail, instead, I got some essential pages in my possession.
In total, I have written nine articles to inform my audience about the developments (I, II, III, IV, V, VI, VII, VIII, IX). After the last one, which was a comprehensive overview of every piece of information I had found (published on March 28, 2018, at the BullionStar website), a reply to another FOIA request came into my mailbox. I received a document that irrefutable reveals a lie by the auditor.
Today’s article is about this falsehood, and numerous other false statements by the auditor, that all have one thing in common: they hide the fact that most vault compartments have been re-opened multiple times after being put under permanent seals, which were meant to prevent re-opening of the doors. Upon request, the auditor provided me one argument for these actions—the “re-opening” of compartments. Alas the argument is in conflict with another statement by them, made under oath, so the auditor still stands as unable to answer a critical question.
Unfortunately, and contrary to how it could have been done, the entire audit process from 1974 until 2008 is extremely complicated. The account below is simplified—I can’t discuss every detail in every article—but for the ones that want to know the details I have added external sources (in parentheses with hyperlinks), which can be used to cross-check my statements. (Also, you can read my previous posts, and if anything is still unclear, I invite anyone to ask me to expand on my conclusions in the comment section below this article. I’m willing to substantiate any findings—as one should when making bold claims.)
Let’s start with some background information, and then we will discuss the heart of the matter.
Introduction
The US official gold reserves are the largest globally at 8,134 metric tonnes (owned by the US Treasury). Although this gold does not back the US dollar at a fixed parity as it did before 1971, it does provide essential support as a final backstop to the dollar and thus credibility to the present world reserve currency.
The majority of the gold is located at the US Mint depository at Fort Knox. Smaller amounts are stored at US Mint depositories in Denver and West Point. Aggregated this metal is referred to as Deep Storage gold and is captured within 42 sealed vault compartments. The remainder is at the Federal Reserve Bank of New York.
When the audits commenced in 1974, the protocol designed was simple (page 534). The following excerpt is from the first auditing committee:
In performing the audit, the gold bars are physically moved from one vault compartment to another. During this operations [sic], the melt numbers and the number of bars in each melt are verified with an inventory listing, and one in fifty melts is randomly selected for weighing and test assay.
One melt averages about twenty bars cast from one crucible of molten gold.
The audit protocol follows that “these actions, having once been performed by an authorized committee, in accordance with established procedures, will not have to be repeated as long as the assets verified remain under an unimpaired joint seal.” Compartments physically verified were placed under Official Joint Seal (OJS) to “avoid the necessity of verifying all assets in each annual or special settlement (audit).” The US Treasury pledged to do a “periodic, cyclical inventory” to “ensure that about 10 percent of the gold” was physically inspected annually, eventually to have audited “all the gold for which the US government is accountable” “by 1984.” The essence of the “established procedures” was to open, audit and seal each compartment once. We will return to this fundamental topic later on.
Since the stated purpose of joint sealing was to avoid the need of “re-audits,” all the gold could (after 1984) be verified by simply checking if the seals were unimpaired. Great intentions, but this is not what happened.
The current auditor of the US monetary gold is the Department of the Treasury’s Office of Inspector General (OIG). Representing the OIG, Eric M. Thorson attended the congressional hearing for the Gold Transparency Act (not enacted) that was initiated by Ron Paul in 2011. Mr. Thorson’s testimony at the hearing serves as the official statement by the government on the audits. Having weighed his words carefully, Thorson spoke under oath:
… 100 percent of the U.S. Government’s gold reserves in the custody of the Mint has been inventoried and audited. … I can say that without any hesitation, because I have observed the gold and the security of the gold reserves myself.
… the Committee for Continuing Audit of the U.S. Government-owned Gold [The Committee that started the audits] performed annual audits of Treasury’s gold reserves from 1974[*] to 1986. … by 1986, 97 percent of the Government-owned gold held by the Mint had been audited and placed under joint seal. So once you have done that, and that seal remains unbroken, then I am not sure what other benefit there would be to going back into it at that point. …
Since 1993, when we [OIG] assumed responsibility for the audit, my office has continued to directly observe the inventory and test the gold. In fact, my auditors signed the official joint seals … placed on those compartments, inventoried and tested in their presence. At the end of Fiscal Year of 2008, all 42 compartments had been audited by … the Committee for Continuing Audit of the U.S. Government-owned Gold, or my office, and placed under official joint seals.
Thus, in summary:
- From 1974 until 1986, 97 percent of the gold at the Mint had been verified by the Committee for Continuing Audit.
- In 1993 the OIG became responsible for the audits, and by 2008 all compartments had been verified and sealed.
The conclusions we derive from Thorson’s testimony:
- From 1987 until 1992, there were no audits.
- From 1993 until 2008, the remaining 3 percent of the gold was verified.
Thorson doesn’t mention anything about vault compartments having been re-opened.
The Problem
First of all, the OIG did not assume responsibility for the audits since 1993, but since 1982 as disclosed in one of the few documents that survived the 1980s (page 2).
Effective October 1, 1982, the Internal Audit Staffs of BGFO and the United States Mint [Committee for Continuing Audit] were reorganized under the Department of the Treasury, Office of the Inspector General [OIG].
Ever since the OIG became part of the audits in 1982, exactly what was not supposed to happen, did happen: vault compartments that had been physically verified and sealed were re-opened. Read with me, from the 1986 audit report regarding the Fort Knox (page 8) and Denver (page 9) depositories:
For some reason, starting in 1983, “re-audits” were performed over 1,929 tonnes “in accordance with the plan approved by the Treasurer.” However, in 1983, both depositories had already been fully audited, while West Point had not. Why were these compartments re-opened when the protocol stated that, “these actions” (physical verification) “having once been performed … will not have to be repeated as long as the assets verified remain under an unimpaired joint seal”? The OIG can’t explain this to me, and neither can it explain to me what “the plan approved by the Treasurer” was.
What Thorson carefully refrained from mentioning under oath, he mentions in a written statement for the Gold Transparency Act. At the surface, his official testimony seems identical to his written statement, but when I compared both word for word, the latter crosses a topic that’s excluded in the former. Thorson never spoke about this in the congressional hearing (page 45):
From 1987[**] to 1992, the Mint continued to perform an annual inventory and verification of the gold reserves in accordance with its own policies over those compartments that had not been placed under Official Joint Seal…
Note that from the quote above, we learn that the US Mint—mind you, the custodian of the gold—audited the US monetary gold “in accordance with its own policies” from 1987 through 1992. This is arguably like a bank opening its customers’ safety deposit boxes. According to universal auditing principles, a custodian is not authorized to audit its client’s assets. An independent entity should audit custodial gold. This might explain why Thorson failed to mention this in the congressional hearing.
Note also that Thorson writes that the Mint exclusively opened “those compartments that had not been placed under Official Joint Seal.” This is false, and I can prove it.
I have obtained copies of the seals that were placed by the Mint on 5 Deep Storage compartments (together containing 795 tonnes of gold) between 1987 and 1992 (download here). Thorson’s written statement is false, as these compartments had, for a fact, already been verified and sealed, because they were all at Fort Knox and Denver, which were fully audited by 1982. Let’s have a look at one of the seal copies.
We can see the “date sealed” at the top, “July 25, 1990,” and the depository is “Fort Knox, Kentucky.” Thus, Thorson lied to us when he said that the Mint was only verifying “those compartments that had not been placed under Official Joint Seal,” because we know Fort Knox was fully audited, and thus all of its compartments put under Official Joint Seal, by 1982.
We can also see on the seal when this compartment was “sealed previously.” It was in 1976 (underlined in red). Confirming it was a “re-audit.” If it was the first audit, the “sealed previously” date had to be prior to 1974, before any audits were performed.
Last but not least, at the very bottom of the seal, we see a date, “February 16, 1993” (in the red oval), which is when this seal was removed by the OIG (presumably for yet another “re-audit”). More evidence that the OIG must have known what happened to these compartments in between 1987 and 1992. As, removing the seal in 1993 by the OIG, clearly would have shown the history of this compartment. Attentive readers might see a pattern emerging.
From 1993 until 2008, additional compartments were “re-audited.” Thorson, again, did not mention these “re-audits” under oath, but in this specific period, more than 2,000 tonnes*** of gold saw the light of day again. I know through an excel sheet (download here) the OIG sent me in response to a FOIA request. When I asked the OIG for confirmation on how much they audited since 1993 they replied (source):
[Since 1993]…we observed the counting of 246,203 bars, which equates to 81,638,569 FTOs (or 2,539 tonnes).
When I asked my contact at the OIG why thousands of tonnes had been “re-audited” in periods from 1983 until 2008, he replied:
Unfortunately, the OIG stopped responding to my emails by late 2016. Everything had to be submitted through FOIA requests, I was told, which made my investigations take a few years extra.
Notice that the OIG doesn’t mention “the plan approved by the Treasurer,” which at least could have explained the “re-audits” from 1983 until 1986.
An explanation of why so many compartments had been “re-verified (in some cases) was because occasionally vault contents would have to be moved.” However, this argument makes no sense. It is true that since 1974, when the audits started, gold has been moved. Roughly 1,900 tonnes were moved from the New York Assay Office to West Point. But this movement occurred in 1982 before any “re-audits” began. There have been no other substantial movements of gold (read the chapter “Problem 11”).
Additional evidence indicating there hasn’t been any movement of Deep Storage gold comes, ironically, from Thorson. Let’s go back to the congressional hearing with Paul and Thorson in 2011. After Thorson’s testimony, a Q&A follows wherein Paul asks Thorson about the audits from 1974 until 1986, and if it would be “worthwhile to inventory and assay [audit] this portion of the gold” again. Thorson replies that would be unnecessary because (39:00):
. . . there is no movement. Those doors aren’t opened. There is nothing there that can happen. Because once those doors are sealed … it’s very obvious if those seals are ever broken. … There is no movement. Those doors are not opened.
A strange thing to say, for Thorson, as this is exactly what he was continuously doing: re-opening the compartment doors. With this statement, Thorson confirms that any compartment should never have been re-opened. Not only is this what happened time and time again, but it also started precisely from the moment Thorson’s department (OIG) became involved with the audits in 1983.
In trying to think of any legitimate reason why compartments have been re-opened, ever, I decided to submit a FOIA request for the audit protocols that prevailed after 1992. Maybe the audit approach had changed? If the OIG can’t explain it to me, maybe I can find the answers in some documents? What if I’m still missing something?
Eventually, I received the Mint’s 2005 audit directive that shows us whenever a compartment has been “verified. . . the annual verification [i.e., audit] will be limited to inspection of the Seals.” Put differently: once physically verified the doors remain closed (from page 11):
Makes sense as this auditing approach matches the one from the 1970s. Like Thorson said during the congressional hearing in 2011: “So once you have done that [physical verification], and that seal remains unbroken, then I am not sure what other benefit there would be to going back into it at that point. . . . There is no movement. Those doors are not opened.” (Note in the quote above that “An OIG Representative must be present for any subsequent opening.” The issue isn’t whether it’s possible to re-open a compartment. Gold inside a compartment that can never be opened again has no value. You might as well put it in a rocket a blast it into the sun. The point is that barring legitimate reasons to re-open a compartment (e.g., selling the metal inside), they should remain closed.)
Conclusion
Altogether, the vast majority of Deep Storage vault compartments have been re-opened for dubious reasons. (For exact data on “re-audits,” see my article “Audits Of US Monetary Gold Severely Lack Credibility.”)
After years of prosecuting, these are the facts as they lay in front of us:
- The majority of Deep Storage vault compartments have been “re-opened” for unknown or dubious reasons. (Again, for details, see “Audits Of US Monetary Gold Severely Lack Credibility.”)
- Under oath, the auditor, Thorson, carefully avoided the subject of “re-opening” compartments.
- In another written statement, the same auditor lied about the subject of “re-opening” compartments.
- When this auditor was asked for an explanation regarding the “re-opening” of compartments, it could only muster an unfitting one.
I find it astonishing that all falsehoods the auditor (OIG) has spread have in common that they hide the fact compartments have been “re-opened.”
My investigation concerns the audits, which appear to have been executed with an inadequate degree of integrity. Accordingly, there should be a new audit authorized by Congress, which, incidentally, is also the opinion of former US Mint Director Edmund C. Moy (see tweet below).
@NotoriousCLO @HereTizz @KoosJansen Not much but wouldn’t satisfy him. IMO there should be a comprehensive audit authorized by Congress.
— Edmund Moy (@EdmundCMoy) January 19, 2015
https://platform.twitter.com/widgets.js
Naturally, if the OIG or Treasury wants to respond to my findings, that would be more than welcome, and I would be happy to engage with them.
Notes
*: The original documents states “1975” but for the sake of simplicity I have changed it into “1974”. Officially, the Committee for Continuing Audit of the U.S. Government-owned Gold started in 1975, but because they accepted the audit performed in 1974 in their program effectively their program started in 1974.
**: The original documents states “1986” but to improve the readability of this post I have changed it into “1987.”
***: An overview of the “re-audits”:
– From 1983 until 1986, 1,929 tonnes were “re-audited.”
– From 1987 until 1992, 796 tonnes were “re-audited.”
– From 1993 until 2008, 2,296 tonnes were “re-audited.” (By 1986 only 243 tonnes at West Point were not audited. According to the OIG, from 1993 until 2008, 2,539 tonnes were audited. 2,539 minus 243 is 2,296, which is the amount “re-audited” from 1993 until 2008.)Altogether from 1983 until 2008, 5,021 tonnes have been “re-audited” for unclear reasons.
Tyler Durden
Tue, 12/17/2019 – 18:45
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