- Syria's Assad Calls US-Backed Kurdish Militia "Traitors" Under Foreign Control
On Monday Syrian President Bashar al-Assad described US-backed forces in eastern Syria as “traitors” during a meeting with Russian Deputy Prime Minister Dmitry Rogozin. "When we talk about those referred to as 'the Kurds', they are in fact not just Kurds," Assad said in remarks released through official Syrian government accounts on social media. "All those who work for a foreign country, mainly those under American command… are traitors."
Washington has given substantial military assistance and various supplies to the Kurdish-dominated Syrian Democratic Forces (SDF), not to mention direct air power and artillery support, which has enabled the SDF to seize a sizable part of eastern Syria, including the cities of Raqqa and Manbij, and many of country's valuable oil and gas fields.
Assad received the Russian delegation headed by Rogozin in Damascus, and said further that the victory over terrorists “has created conditions for accelerating the process of restoring the Syrian economy.”
Image source: European Pressphoto Agency“This visit may also help us boost cooperation in other fields, which were not mentioned earlier, when we determined the priorities of our economic relations,” he said. Assad has on multiple occasions promised to restore all of Syria to its original sovereign borders from before the war.
Predictably, this prompted an angry response from the Syrian Democratic Forces, which said in a statement: “Bashar Assad and what’s left of his regime are the last people with the right to talk of treachery. It was the regime that flung the country’s doors wide open to hordes of foreign terrorists from across the world.”
Assad's words directed at Kurdish forces operating under US sponsorship have come at a time just after the collapse of the once sizable Islamic State. The rapid collapse of ISIS – which once controlled an area the size of Britain stretching from the edges of Aleppo to Mosul in Iraq, and down to Ramadi and Fallujah – began in earnest in early September when the Syrian Army breached ISIS lines around Deir Ezzor city, after which the city was fully liberated by early November. And as ISIS retreated in the Deir Ezzor countryside, it lost its previous Syrian capital of Raqqa in mid-October to the US-backed Syrian Democratic Forces (SDF), which also struck a deal to allow the quick exit of ISIS terrorists to other parts of Syria and region, according to a report by the BBC.
As we explained previously, the US strategy of support to the Kurds appears predicated on the Pentagon forcing itself into a place of affecting the Syrian war's outcome and final apportionment of power: American power and planners in the region are likely to seek the establishment of permanent US bases under a Syrian Kurdish federated zone with favored access to Syrian oil doled out by Kurdish partners.
Map via The Carter Center. Battlefield situation as of early December.But it appears the Kurds could already be cutting separate deals and are in secret and no doubt contentious ongoing communications with Syria and Russia, which means a US exit from Syria will likely be the focus of any future dialogue between the SDF factions and Damascus. According to University of Oklahoma Middle East expert Joshua Landis, the Kurds and the Syrian government are now sharing oil revenues from disputed oil fields controlled by Kurdish groups in some parts of Syria's east.
Landis has previously confirmed that, "the Syrian gov, Syrian Kurds, and Arab tribes share oil revenues already. SAG gets 65% of revenues in Rmeilan field. PYD gets 20% (powerful Kurdish confederation in Syria's north: the Democratic Union Party). Arab forces get 15%." Landis also posted the question, "is this the model for a future deal between Kurds, Arabs, and the Syrian Government in northern Syria?"
Assad's "traitors" comment today is likely meant to signal to Syrian Kurds that their future survival depends on direct dealing and rapprochement with the Syrian government, and that time is running out. But this also depends in large part on the White House's long term policy towards the Syrian Kurds and broader Syria policy in general, all of which has been somewhat inconsistent and unclear of late under the Trump White House.
- A Bad Moon Is Rising In America
Authord by Alastair Crooke via The Strategic Culture Foundation,
It seems that we are coming to the crux: President Trump, like Reagan before him, was elected by ‘the people’ rather than by (what Paul Craig Roberts calls the ‘ruling interest groups’): “As a high official in Reagan’s government who was aligned with Reagan’s goals to end stagflation and the Cold War, I experienced first-hand, the cost of going against the powerful interest groups that are accustomed to ruling. We took away part of their rule from them, but now they have taken it back. And, they are now stronger than before”.
I too, experienced something of the panic that the end to the Cold War induced amongst the ‘ruling interest groups’ — after all, American policy in the Middle East (and western Europe) was entirely dominated by an unstoppable momentum to cleanse it of all Russian influence. And then – ‘pop’ – the Soviet enemy suddenly, was ‘enemy’ no more. Yet, the ‘ruling interest groups’ were, by then, fully committed to a globalized (i.e. a culturally non-nationalist, consumerist, life-style,) rules-based, political and financial, ‘world’, shaped by the US. Serendipitously, after 9/11, terrorism emerged served to underpin the perceived need for a common defence-based, NATO-esque, global ‘order’, as the glue to America’s unipolar moment.
President Obama lay very much in the globalist ‘struggle for a democratic-liberal world’ mould, (though he did try to make the ‘ruling interests’ understand that there were limits: that there had to be boundaries to US commitments). In other words, Obama accepted the globalist premise, though he tried to mitigate some of its military impulses. Notably however, he acquiesced to re-heating the Russia ‘threat’ (after Medvedev gave place to Mr Putin (thus ending Obama’s hope to seduce Russia into the embrace of the global economic order).
But then Donald Trump, elected President by his deplorables’ base, made clear that he wished for détente with Russia, and even disdained the claims made on ordinary Americans by the maintenance of America’s unipolar global ‘order’. For this heresy, he has been punished by the manufactured ‘Russiagate’ non-scandal. “Can a president, concerned that he might be removed from office by a special prosecutor or possibly assassinated, resist the march toward war?” – asks Paul Craig Roberts, who asserts that the President has been effectively caged, by a trifecta of Establishment generals, on the one hand; and by a Goldman Sachs posse, on the other.
That the ‘ruling interests’ have managed substantially to contain President Trump is undeniable, but what is new, and perhaps – or perhaps, not – alters the calculus, is that these ‘ruling interests’ have had to come out from the shadows into the open.
The former Acting Director of the CIA, Mike Morrell, an early voice peddling the Russian collusion meme now publicly admits in a surprisingly frank interview with Politico, his leading role in the intelligence community waging political war against President Trump, describing his actions as something he didn't "fully think through", adding that maybe it wasn't such a great idea to leak against, and bash a new president: “There was a significant downside”, Morrell acknowledges. Just to recall: Not only had Morell in an early NY Times op-ed piece asserted that he was committed to doing "everything I can to ensure that she [Hillary Clinton] is elected as our 45th president”, but he went so far as to call then candidate Trump "a threat to our national security”, while making the extraordinary claim that "in the intelligence business, we would say that Mr. Putin had recruited Mr. Trump as an unwitting agent of the Russian Federation."
Now that Morrell has come clean, and the Robert Mueller investigation increasingly is publicly being revealed as a politicised hatchet operation, why then speak of a possible Bad Moon Rising? Well, simply because Morrell’s bout of candour does suggest that the Deep State now may be thinking compromise: It will give Trump some leeway, but will want its quid pro quo from him, too.
Some such signs of possible quid pro quo have been already apparent: Trump ate his campaign rhetoric on Afghanistan to allow the US military to persecute its (long and unsuccessful) war there. The Pentagon too, has announced that 2,000 US military, and an additional large number of contractors, will stay on in north-eastern Syria without specific time limit – after the end of anti-ISIS operations there. And fresh troops have been inserted into Iraq, and deployed to within 100 kms of the Iranian border. The ostensible justification is that with ISIS’ defeat – a void has opened, and into this ‘void’, Iran might penetrate. Only an aggressive US military presence might stop it, it is said. But American forces in Syria have been becoming ‘aggressive’ there too (against Russian Aerospace Forces, and not just Iranians) – as this report by RT makes clear:
(A US F-22 fighter was preventing two Russian Su-25 strike aircraft from bombing an ISIS base to the west of the Euphrates November 23, according to the Russian Defence ministry).
General Igor Konashenkov said: “The [USAF] F-22 launched decoy flares and used airbrakes while constantly maneuvering [near the Russian strike jets], imitating an air fight”. He added that the US jet “ceased its dangerous manoeuvres” only after a Russian Su-35S fighter jet joined the two strike planes, [chasing away the F22]. “Most close-mid-air encounters between Russian and US jets in the area around the Euphrates River have been linked to the attempts of US aircraft to get in the way [of the Russian warplanes] striking against Islamic State terrorists”, the general said.
The statement came as a response to the Pentagon’s claims about Russian or Syrian aircraft crossing “into our airspace on the east side of the Euphrates River,” Lt. Col. Damien Pickart, the spokesman for US Air Force Central Command, told CNN earlier on Saturday.
Konashenkov said that any claims made by US military officials concerning the fact that there is “any part of the airspace in Syria that belongs to the US” are “puzzling.” Konashenkov also said that “Syria is a sovereign state and a UN member. And that means that there… can be no US airspace ‘of its own’”.
All of this rather looks as though the US military wants to flex muscle and is ‘looking for trouble’ with someone. Operational military co-ordination in Syria between American and Russian militaries, deliberately is being allowed to wither (on the US side), I understand. President Putin it seems, has read the runes correctly, and is pre-empting this new US Deep State ‘purpose’ to protect the Middle Eastern (suddenly opening) ‘void’ – by announcing a part Russian military withdrawal from Syria. Putin is not ‘looking for trouble’ there. The job in Syria is done. He knows that the return of Russia to the Middle East stands as a ‘poke in the eye’ to decades of a neo-con doctrine of precisely trying to expel Russia from the region.
But … into this paradigm of US Establishment re-calibrated purpose: ‘to protect the Middle Eastern void’ from the likes of Iran’s Revolutionary Guards, Hash’d al-Sha’abi and Hizbullah, percolating their influence across the region, President Trump has tossed his bombshell of declaring Jerusalem the capital of Israel. Trump had good domestic reasons for this act: the evangelical constituency within the Republican Party is significant (perhaps even fifty percent), and the Israeli Right (Sheldon Adelson has been a big Trump donor), and its powerful lobby, represents a ‘ruling interest’ that has a clout in DC that can match up to that of other components of the Deep State. It can, if it so chooses, cast an umbrella around an American politician.
In any case, ‘the act’ would have appealed to Trump’s delight in defying conventional wisdom (especially, if in so doing, he could snub his predecessor, too). It fits too, with his Art of the Deal methodology: weigh up the elements of power in your hands, and match them against those of your business opponent. And having done this analysis, where possible, remove or weaken your opponent’s components of strength – and build your own. From this optic, Palestinian ‘rejectionism’ in recognising Israel, and insisting on Jerusalem as the Palestinian capital, was the primordial element to any Palestinian negotiating hand. Indeed, it has been pretty much all of it. And Trump simply KO’d it (or, so it may have seemed to him). Without Jerusalem, and the withholding of recognition of Israel remaining as Palestinian negotiating cards, the negotiation becomes banal. It is then just about ‘real estate’, and the amount of money required to get to a Palestinian ‘yes’. It is a particularly western way of negotiating: the weighing and balancing of literal components of power. It is not however the Hizbullah ‘way’ (I speak with a modicum of experience). Sayyed Hassan Nasrallah (Secretary General of Hizbullah) simply recast Trump’s play: asymmetrically.
‘Yes’, he said: Jerusalem is indeed ‘the core, the axis and the essence of the Palestinian case’. But that is the half of it. For Jerusalem – the Holy City – represents the core, and the essence of Muslim and Christian cultural identity. It is their history, their meaning, their sanctities. President Trump cannot ‘confiscate’ that identity, that history, and meaning – and simply give it to Israel. Nasrallah has called for Israel to be diplomatically isolated, for an Intifada, and for all movements and components to the resistance (Shi’i and Sunni; Christian and Muslim) to join the struggle for Jerusalem – the Holy City – and for al-Aqsa, the holy shrine, which is now in grave peril, he claimed. Nasrallah turned President Trump’s play from a ‘real estate’ tussle into a war of religious symbols – paradigm. His rendering makes it hard for so-called Muslim ‘moderates’ to deny Nasrallah’s casting of the conflict as one of emotionally charged spiritual symbols. They cannot, and are not. (See here, Abdul Bari Atwan, for example).
In sum, Nasrallah, backed by Iran, and in parallel by Egypt’s Sunni religious leadership of al-Azar, by Turkey (taking the Caliph’s mantle) and many others, has redefined President Trump’s Art of the Deal ploy — not as one robbing the Palestinians of the heart of their cause, but as the re-ignition of the long struggle of all Muslims and Christians for Jerusalem, and all, for which it stands.
The American ‘ruling interests’ – after a long series of failures in the Middle East – will not abide yet more: they will retch at the thought of Israel challenged in this way; of Saudi Arabia humiliated and at Hizbullah and Iran in the vanguard of a regional campaign for Jerusalem, and for Palestine – and by implication, against those who have been seen willing to normalise with Israel.
A Bad Moon is rising: America is polarised at home; unitive government has splintered into departments at odds with each other, and with officials leaking on each other; with fake news abounding; with Congress gridlocked, and with American social and political fabric tearing apart. Against this background – can a president, concerned that he might be removed from office, and beset still by hitherto hidden ‘ruling interests’ now dragged out from the shadows into the public glare for their tawdry schemes, resist the march toward war – the original question posed by Paul Craig Roberts?
Either a war in North Korea (“the greatest threat facing America”, McMaster says), or an aggressive military show of force against ‘bad actor’ Iran – and in support of a failing Saudi Crown Prince. Is this the diversion that either a now exposed and vulnerable Deep State, and a hobbled President, might welcome as the chance to stand erect in public esteem? Both might share a common interest in escaping domestic problems to mount a show of American strength and military power. Very possibly they might, but oddly, the US military have chosen to leave American soldiers hostage and isolated in both cases: 30,000 US forces in the DMZ between the Koreas, and in smaller outposts in north-eastern Syria and in Iraq. This may turn out badly. Remember Beirut in 1983.
- China Systemic Risk: Liquidity Problem Surfaces At HNA Group Less Than Two Weeks After Company's Denial
Here we go again…
On December 8, we lamented how every few days we return to the subject of systemic risk in China related to its big four highly-indebted conglomerates, HNA, Anbang, Evergrande and Dalian Wanda. We also noted how our chief source of concern had become HNA, after it issued a bond with less than one year to maturity with the extortionately high coupon of 9%. And S&P downgraded HNA’s credit rating from b+ to b, five levels below investment grade. The reason for our continuing focus on HNA is its $28bn of short-term debt which matures before the end of next June, much of it accumulated during a $40 billion binge of acquisition-driven growth which saw it become a major shareholder in Deutsche Bank, Hilton Worldwide and others.
In our update less than two weeks ago, we noted how HNA business units had suffered further credit downgrades and been forced into cancelling bond issues. For example, Hainan Airlines cancelled a 1 billion yuan ($151.2 billion) issue of perpetual bonds to repay maturing debt, HNA Investment Group (hotels and real estate) cancelled a 5.22 billion yuan ($790 million) issue and S&P cut the long-term credit rating of HNA’s Swissport Group Sarl to b-, six levels below investment grade, citing concerns about its parent.
As this spate of bad news travelled across the business media, we noted wryly that.
A sign that a company’s financial position is becoming critical is when company executives make public pronouncements that all is fine without providing the financial data to back up their assertions.
HNA, in our opinion, entered this “zone” after both the Financial Times and Bloomberg reported on interviews they’d had with a newly-appointed HNA board director, Zhao Quan. According to Quan, the company has “healthy” cash flow, “stable” debt structure and there was no liquidity problem. However, he did acknowledge the company was affected by “end-of-the-year tightness” in lending markets.
It’s become clear that HNA’s position is more precarious than Zhao was prepared to acknowledge. Over the weekend, Citic Bank Corp., China’s seventh largest bank, stated that HNA Aviation Group is in difficulty. From Bloomberg.
Citic Bank Corp. said a unit of HNA Group Co. is having difficulty repaying certain short-term debts, just over a week after the Chinese conglomerate said it won’t default in the coming year. HNA Aviation Group Co. has had trouble paying bankers’ acceptances – debt instruments that mature in the short term – and Citic Bank is working with HNA Group to try to resolve the situation, the Chinese lender said in a statement sent exclusively to Bloomberg News this weekend. The group has several bonds and loans from multiple banks maturing at similar times, causing a “temporary liquidity” issue, Citic Bank said.
The statement from Citic Bank comes after HNA Group director Zhao Quan sought to ease investor concerns over the conglomerate’s ability to pay its debt obligations. The company has “a healthy and stable debt structure” and there would be no default in the coming year, he said in a Dec. 8 interview.
Not surprisingly, when Bloomberg asked for an explanation, HNA was ready with an explanation for the current mishap.
HNA Group’s cooperation with Citic Bank remains normal and there’s no delayed payment, the company said in a WeChat response to Bloomberg News questions on Saturday, declining to comment further.
An HNA unit’s dollar bonds due in 2018 dropped 0.4 cent, the first decline in three trading days, to 97.2 cents on the dollar as of 11:20 a.m. Monday in Hong Kong, according to prices compiled by Bloomberg.
While a bond market rout drove up funding costs for all Chinese firms recently, the acquisitive conglomerate has faced its own issues as government scrutiny of its finances this year has made some investors wary. Chief Executive Officer Adam Tan said late November that the company is considering selling assets, suggesting it is reversing a shopping spree that cost tens of billions of dollars.
In another Bloomberg piece from yesterday, “The Mysterious Chinese Company Worrying The World”, authors Laurence Arnold and Prudence Ho noted that although the company is regularly in the news, HNA “remains shrouded in mystery”. Although the focus of investigations is different, HNA is currently being investigated by lawmakers and regulators in the US and Europe, as well as in China, where the authorities are seeking to rein back foreign takeovers which contributed to capital outflows.
In the US, HNA is being investigated by the Committee on Foreign Investment in the United States (CFIUS) due to its proposed purchase of a stake in the hedge fund owned by Anthony Scaramucci, President Trump’s former communications director. It is also being sued for its dealings with bankrupt travel company, Travana. Former Travana executives claim that the company may have significant claims against HNA which, they say, benefited from its closure. In another case, two HNA units are being sued for providing false and improper information to the CFIUS which led to the collapse of a $325m takeover of a technology company. In Europe, the German financial regulator is investigating whether HNA accurately reported its holdings while acquiring its stake in Deutsche Bank.
Meanwhile, putting aside all the lawsuits, scrapped bond issues and credit downgrades, the ownership of HNA, and its potential links to the Chinese authorities, remains opaque. From the Bloomberg article.
HNA disclosed in July that it’s controlled by two company-connected charities named Cihang — one based in New York, the other in China’s resort island of Hainan — that together own 52 percent, and that 12 company officials, including founders Chen Feng and Wang Jian, together hold about 47.5 percent. Prior to that, a little-known investor named Guan Jun had been HNA’s biggest shareholder, with a 29 percent stake, according to Chinese corporate filings in late 2016. He was holding it on behalf of the company and its leadership, Bloomberg News reported. HNA reorganized its ownership structure in early 2017 and Guan distributed most of his holdings to five individuals, who then donated the shares to HNA’s Cihang foundation. Guan donated his remaining stake, about 4.4 percent, to the charity as well.
As Bloomberg notes, the ownership issue is still not really settled, for example, why did HNA executives place their shares with Guan in the first place? Then, there’s the unsubstantiated allegations of Chinese billionaire-in-exile, Guo Wengui. Guo, a property developer who allegedly fled China when he discovered he would be detained as part of Xin Jinping’s crackdown on corruption. Guo, he resides in a $68m apartment on New York’s Upper East Side, is a member of Donald Trump’s Mar-a-Lago club. Here is a picture he tweeted of himself with former senior Trump adviser, Steve Bannon.
Guo claims that HNA has secret financial ties to top officials in China’s Communist Party. HNA denied the allegation and is suing him in New York for “defamatory and libelous statements, including that Chinese Communist party officials are undisclosed shareholders in the company.”
Confused?
While almost everything we read about HNA is “shady”, one thing is certain, HNA’s financial position is far from being “stable”, as the company asserts. Indeed, all the evidence points to it becoming more unstable, although its “private” ownership structure makes it even harder to analyse. Despite this, the analysts which Bloomberg spoke to don’t sound too alarmed at this point.
“There is opacity around HNA’s corporate and ownership structure as well as its funding strategies,” Anne Zhang, executive director for fixed income, currencies and commodities at JPMorgan Private Bank in Asia, said earlier this month. “It’s not clear which of its entities will tap the market and if there are any inter-entity fund flows. The market is certainly demanding a lot of risk premium for its opacity.”
There are concerns over HNA’s ability to pay its debt obligations but the firm’s default probability in the near term is “quite low,” Warut Promboon, managing partner at credit research firm Bondcritic Ltd., said earlier this month, adding that he expects Chinese lenders to support the company.
HNA’s interest expenses more than doubled to a record 15.6 billion yuan ($2.4 billion) in the first half from a year earlier, according to data compiled by Bloomberg. Its short-term debt expanded to 185.2 billion yuan, exceeding its cash-pile. “Financial flexibility is becoming increasingly challenged,” Todd Schubert, head of fixed-income research at Bank of Singapore Ltd., said earlier this month.
We are less sanguine.
We see it as a major “red flag” when fee-hunting banks – Bank of America in July and HSBC earlier this month – warn their bankers not to pitch for new business with a company that’s been on a $40 billion acquisition spree since 2016.
- The RussiaGate Witch-Hunt: Stockman Names Names In The Deep State's "Insurance Policy"
Authored by David Stockman via Contra Corner blog,
There was a sinister plot to meddle in the 2016 election, after all. But it was not orchestrated from the Kremlin; it was an entirely homegrown affair conducted from the inner sanctums—the White House, DOJ, the Hoover Building and Langley—-of the Imperial City.
Likewise, the perpetrators didn't speak Russian or write in the Cyrillic script. In fact, they were lifetime beltway insiders occupying the highest positions of power in the US government.
Here are the names and rank of the principal conspirators: John Brennan, CIA director; Susan Rice, National Security Advisor; Samantha Power, UN Ambassador; James Clapper, Director of National Intelligence; James Comey, FBI director; Andrew McCabe, Deputy FBI director; Sally Yates, deputy Attorney General, Bruce Ohr, associate deputy AG; Peter Strzok, deputy assistant director of FBI counterintelligence; Lisa Page, FBI lawyer; and countless other lessor and greater poobahs of Washington power, including President Obama himself.
To a person, the participants in this illicit cabal shared the core trait that made Obama such a blight on the nation's well-being. To wit, he never held an honest job outside the halls of government in his entire adult life; and as a careerist agent of the state and practitioner of its purported goods works, he exuded a sanctimonious disdain for everyday citizens who make their living along the capitalist highways and by-ways of America.
The above cast of election-meddlers, of course, comes from the same mold. If Wikipedia is roughly correct, just these 10 named perpetrators have punched in about 300 years of post-graduate employment—and 260 of those years (87%) were on government payrolls or government contractor jobs.
As to whether they shared Obama's political class arrogance, Peter Strzok left nothing to the imagination in his now celebrated texts to his gal-pal, Lisa Page:
"Just went to a southern Virginia Walmart. I could SMELL the Trump support……I LOATHE congress….And F Trump."
You really didn't need the ALL CAPS to get the gist.
In a word, the anti-Trump cabal is comprised of creatures of the state.
Their now obvious effort to alter the outcome of the 2016 election was nothing less than the Imperial City's immune system attacking an alien threat, which embodied the very opposite trait: That is, the Donald had never spent one moment on the state's payroll, had been elected to no government office and displayed a spirited contempt for the groupthink and verities of officialdom in the Imperial City.
But it is the vehemence and flagrant transparency of this conspiracy to prevent Trump's ascension to the Oval Office that reveals the profound threat to capitalism and democracy posed by the Deep State and its prosperous elites and fellow travelers domiciled in the Imperial City.
That is to say, Donald Trump was no kind of anti-statist and only a skin-deep populist, at best. His signature anti-immigrant meme was apparently discovered by accident when in the early days of the campaign he went off on Mexican thugs, rapists and murderers—-only to find that it resonated strongly among a certain element of the GOP grass roots.
But a harsh line on immigrants, refugees and Muslims would not have incited the Deep State into an attempted coup d'état; it wouldn't have mobilized so overtly against Ted Cruz, for example, whose positions on the ballyhooed terrorist/immigrant threat were not much different.
No, what sent the Imperial City establishment into a fit of apoplexy was exactly two things that struck at the core of its raison d' etre.
First was Trump's stated intentions to seek rapprochement with Putin's Russia and his sensible embrace of a non-interventionist "America First" view of Washington's role in the world. And secondly, and even more importantly, was his very persona.
That is to say, the role of today's president is to function as the suave, reliable maître d' of the Imperial City and the lead spokesman for Washington's purported good works at home and abroad. And for that role the slovenly, loud-mouthed, narcissistic, bombastic, ill-informed and crudely-mannered Donald Trump was utterly unqualified.
Stated differently, welfare statism and warfare statism is the secular religion of the Imperial City and its collaborators in the mainstream media; and the Oval Office is the bully pulpit from which its catechisms, bromides and self-justifications are propagandized to the unwashed masses—the tax-and-debt-slaves of Flyover America who bear the burden of its continuation.
Needless to say, the Never Trumpers were eminently correct in their worry that Trump would sully, degrade and weaken the Imperial Presidency. That he has done in spades with his endless tweet storms that consist mainly of petty score settling, self-justification, unseemly boasting and shrill partisanship; and on top of that you can pile his impetuous attacks on friend, foe and bystanders (e.g. NFL kneelers) alike.
Yet that is exactly what has the Deep State and its media collaborators running scared. To wit, Trump's entire modus operandi is not about governing or a serious policy agenda—and most certainly not about Making America's Economy Great Again. (MAEGA)
By appointing a passel of Keynesian monetary central planners to the Fed and launching an orgy of fiscal recklessness via his massive defense spending and tax-cutting initiatives, the Donald has more than sealed his own doom: There will unavoidably be a massive financial and economic crisis in the years just ahead and the rulers of the Imperial City will most certainly heap the blame upon him with malice aforethought.
In the interim, however, what the Donald is actually doing is sharply polarizing the country and using the Bully Pulpit for the very opposite function assigned to it by Washington's permanent political class. Namely, to discredit and vilify the ruling elites of government and the media and thereby undermine the docility and acquiescence of the unwashed masses upon which the Imperial City's rule and hideous prosperity depend.
It is no wonder, then, that the inner circle of the Obama Administration plotted an "insurance policy". They saw it coming—–that is, an offensive rogue disrupter who was soft on Russia, to boot— and out of that alarm the entire hoax of RussiaGate was born.
As is now well known from the recent dump of 375 Strzok/Gates text messages, there occurred on August 15, 2016 a meeting in the office of FBI Deputy Director Andrew McCabe (who is still there) to kick off the RussiaGate campaign. As Strzok later wrote to Page, who was also at the meeting:
“I want to believe the path you threw out for consideration in Andy’s office — that there’s no way he gets elected — but I’m afraid we can’t take that risk……It’s like an insurance policy in the unlikely event that you die before you’re 40.”
They will try to spin this money quote seven-ways to Sunday, but in the context of everything else now known there is only one possible meaning: The national security and law enforcement machinery of Imperial Washington was being activated then and there in behalf of Hillary Clinton's campaign.
Indeed, the trail of proof is quite clear. At the very time of this August meeting, the FBI was already being fed the initial elements of the Steele dossier, and the latter had nothing to do with any kind of national security investigation.
For crying out loud, it was plain old "oppo research" paid for by the Clinton campaign and the DNC. And the only way that it bore on Russian involvement in the US election was that virtually all of the salacious material and false narratives about Trump emissaries meeting with high level Russian officials was disinformation sourced in Moscow, and was completely untrue.
As former senior FBI official, Andrew McCarthy, neatly summarized the sequence of action recently:
The Clinton campaign generated the Steele dossier through lawyers who retained Fusion GPS. Fusion, in turn, hired Steele, a former British intelligence agent who had FBI contacts from prior collaborative investigations. The dossier was steered into the FBI’s hands as it began to be compiled in the summer of 2016. A Fusion Russia expert, Nellie Ohr, worked with Steele on Fusion’s anti-Trump research. She is the wife of Bruce Ohr, then the deputy associate attorney general — the top subordinate of Sally Yates, then Obama’s deputy attorney general (later acting AG). Ohr was a direct pipeline to Yates…..
Based on the publication this week of text messages between FBI agent Peter Strzok and Lisa Page, the FBI lawyer with whom he was having an extramarital affair, we have learned of a meeting convened in the office of FBI deputy director Andrew McCabe…… right around the time the Page FISA warrant was obtained……
Bruce Ohr met personally with Steele. And after Trump was elected, according to Fusion founder Glenn Simpson, he requested and got a meeting with Simpson to, as Simpson told the House Intelligence Committee, “discuss our findings regarding Russia and the election.”
This, of course, was the precise time Democrats began peddling the public narrative of Trump-Russia collusion. It is the time frame during which Ohr’s boss, Yates, was pushing an absurd Logan Act investigation of Trump transition official Michael Flynn (then slotted to become Trump’s national-security adviser) over Flynn’s meetings with the Russian ambassador.
Here's the thing. There is almost nothing in the Steele dossiers which is true. At the same time, there is no real alternative evidence based on hard NSA intercepts that show Russian government agents were behind the only two acts—-the leaks of the DNC emails and the Podesta emails—-that were of even minimal import to the outcome of the 2016 presidential campaign.
As to the veracity of the dossier, the raving anti-Trumper and former CIA interim chief, Michael Morrell, settled the matter. If you are paying ex-FSA agents for information on the back streets of Moscow, the more you pay, the more "information" you will get:
Then I asked myself, why did these guys provide this information, what was their motivation? And I subsequently learned that he paid them. That the intermediaries paid the sources and the intermediaries got the money from Chris. And that kind of worries me a little bit because if you’re paying somebody, particularly former [Russian Federal Security Service] officers, they are going to tell you truth and innuendo and rumor, and they’re going to call you up and say, ‘Hey, let’s have another meeting, I have more information for you,’ because they want to get paid some more,’ Morrell said.
Far from being “verified,” the dossier is best described as a pack of lies, gossip, innuendo and irrelevancies. Take, for example, the claim that Trump lawyer Michael Cohen met with Russian Federation Council foreign affairs head Konstantin Kosachev in Prague during August 2016. That claim is verifiably false as proven by Cohen's own passport.
Likewise, the dossier 's claim that Carter Page was offered a giant bribe by the head of Rosneft, the Russian state energy company, in return for lifting the sanctions is downright laughable. That's because Carter Page never had any serious role in the Trump campaign and was one of hundreds of unpaid informal advisors who hung around the basket hoping for some role in a future Trump government.
Like the hapless George Papadopoulos, in fact, Page apparently never met Trump, had no foreign policy credentials and had been drafted onto the campaign's so-called foreign policy advisory committee out of sheer desperation.
That is, because the mainstream GOP foreign policy establishment had so completely boycotted the Trump campaign, the latter was forced to fill its advisory committee essentially from the phone book; and that desperation move in March 2016, in turn, had been undertaken in order to damp-down the media uproar over the Donald's assertion that he got his foreign policy advise from watching TV!
The truth of the matter is that Page was a former Merrill Lynch stockbrokers who had plied his trade in Russia several years earlier. He had gone to Moscow in July 2016 on his own dime and without any mandate from the Trump campaign; and his "meeting" with Rosneft actually consisted of drinks with an old buddy from his broker days who had become head of investor relations at Rosneft.
Nevertheless, it is pretty evident that the Steele dossier's tale about Page's alleged bribery scheme was the basis for the FISA warrant that resulted in wiretaps on Page and other officials in Trump Tower during September and October.
And that's your insurance policy at work: The Deep State and its allies in the Obama administration were desperately looking for dirt with which to crucify the Donald, and thereby insure that the establishment's anointed candidate would not fail at the polls.
So the question recurs as to why did the conspirators resort to the outlandish and even cartoonish disinformation contained in the Steele dossier?
The answer to that question cuts to the quick of the entire RussiaGate hoax. To wit, that's all they had!
Notwithstanding the massive machinery and communications vacuum cleaners operated by the $75 billion US intelligence communities and its vaunted 17 agencies, there are no digital intercepts proving that Russian state operatives hacked the DNC and Podesta emails. Period.
Yet when it comes to anything that even remotely smacks of "meddling" in the US election campaign, that's all she wrote.
There is nothing else of moment, and most especially not the alleged phishing expeditions directed at 20 or so state election boards. Most of these have been discredited, denied by local officials or were simply the work of everyday hackers looking for voter registration lists that could be sold.
The patently obvious point here is that in America there is no on-line network of voting machines on either an intra-state or interstate basis. And that fact renders the whole election machinery hacking meme null and void. Not even the treacherous Russians are stupid enough to waste their time trying to hack that which is unhackable.
In that vein, the Facebook ad buying scheme is even more ridiculous. In the context of an election campaign in which upwards of $7 billion of spending was reported by candidates and their committees to the FEC, and during which easily double that amount was spent by independent committees and issue campaigns, the notion that just $44,000 of Facebook ads made any difference to anything is not worthy of adult thought.
And, yes, out of the ballyhooed $100,000 of Facebook ads, the majority occurred after the election was over and none of them named candidates, anyway. The ads consisted of issue messages that reflected all points on the political spectrum from pro-choice to anti-gun control.
And even this so-called effort at "polarizing" the American electorate was "discovered" only after Facebook failed to find any “Russian-linked” ads during its first two searches. Instead, this complete drivel was detected only after the Senate's modern day Joseph McCarthy, Sen. Mark Warner, who is the vice chairman of the Senate Intelligence Committee and a leading legislator on Internet regulation, showed up on Mark Zuckerberg's doorstep at Facebook headquarters.
In any event, we can be sure there are no NSA intercepts proving that the Russians hacked the Dem emails for one simple reason: They would have been leaked long ago by the vast network of Imperial City operatives plotting to bring the Donald down.
Moreover, the original architect and godfather of NSA's vast spying apparatus, William Binney, has essentially proved that the DNC emails were leaked by an insider who downloaded them on a memory stick. By conducting his own experiments, he showed that the known download speed of one batch of DNC emails could not have occurred over the Internet from a remote location in Russia or anywhere else on the planet, and actually matched what was possible only via a local USB-connected thumb drive.
So the real meaning of the Strzok/Gates text messages is straight foreword. There was a conspiracy to prevent Trump's election, and then after the shocking results of November 8, this campaign morphed into an intensified effort to discredit the winner.
For instance, Susan Rice got Obama to lower the classification level of the information obtained from the Trump campaign intercepts and other dirt-gathering actions by the Intelligence Community (IC)— so that it could be disseminated more readily to all Washington intelligence agencies.
In short order, of course, the IC was leaking like a sieve, thereby paving the way for the post-election hysteria and the implication that any contact with a Russian–even one living in Brooklyn– must be collusion. And that included calls to the Russian ambassador by the president-elect's own national security advisor designate.
Should there by any surprise, therefore, that it turns out the Andrew McCabe bushwhacked General Flynn on January 24 when he called to say that FBI agents were on the way to the White House for what Flynn presumed to be more security clearance work with his incipient staff.
No at all. The FBI team was there to interrogate Flynn about the transcripts of his perfectly appropriate and legal conversations with Ambassador Kislyak about two matters of state—-the UN resolution on Israel and the spiteful new sanctions on certain Russian citizens that Obama announced on December 28 in a fit of pique over the Dems election loss.
And that insidious team of FBI gotcha cops was led by none other than……Peter Strzok!
But after all the recent leaks—and these text messages are just the tip of the iceberg—–the die is now cast. Either the Deep State and its minions and collaborators in the media and the Republican party, too, will soon succeed in putting Mike Pence into the Oval Office, or the Imperial City is about ready to break-out in vicious partisan warfare like never before.
Either way, economic and fiscal governance is about ready to collapse entirely, making the tax bill a kind of last hurrah before they mayhem really begins.
In that context, selling the rip may become one of the most profitable speculations ever imagined.
- Here's An Interactive Map Of Which Housing Markets Get Hit The Most By The GOP Tax Bill
With the Republican party (and the S&P 500 apparently) convinced they have the votes required to pass their tax reform legislation this week, the folks at ATTOM Data Solutions took a look at which housing markets will be most impacted by new limitations on mortgage interest and property tax deductions.
First, on the reduction of the mortgage interest deduction to $750,000 from $1,000,000, ATTOM found that nearly 99,000 single family home and condo purchases so far in 2017 involved a mortgage higher than $750,000. And while that represents a small 3.9% of all home purchase loans underwritten so far in the year, per the interactive map below, those 99,000 loans are concentrated in a handful of liberal counties in the Northeast, California and Southern Florida.
Among 2,022 counties included in this analysis and at least 50 home purchase loans so far in 2017, those with the highest share of loan originations above $750,000 were New York County (Manhattan), New York (63.8 percent); San Francisco County, California (58.0 percent); Nantucket County, Massachusetts (57.3 percent); San Mateo County, California (55.2 percent); and Marin County, California (50.o percent). Among those same 2,022 counties, those with the highest number of purchase home loan originations above $750,000 so far in 2017 were Los Angeles County, California (9,197); Santa Clara County, California (5,543); Orange County, California (4,450); Maricopa County, Arizona (3,723); and King County, Washington (3,715).
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Meanwhile, the second proposed change in the GOP tax plan involves a cap on the deductibility of property taxes at $10,000. And, much like the impact of mortgage interest above, the map of who’s most impacted looks eerily similar to the 2016 electoral college map.
The county-level heat map below shows the share of single family homes and condos in each county where the most recent property tax bill available was more than $10,000.
Among the 1,731 counties analyzed, those with the highest share of homes with property taxes above $10,000 were Westchester County, New York (73.4 percent); Luna County, New Mexico (68.7 percent); Rockland County, New York (60.0 percent); Mathews County, Virginia (54.4 percent); and New York County (Manhattan), New York (52.5 percent). Among those same counties those with the highest volume of homes with property taxes above $10,000 were Nassau County (Long Island), New York (176,946); Los Angeles County, California (165,078); Suffolk County (Long Island), New York (155,592); Bergen County, New Jersey (126,096); and Harris County (Houston), Texas (125,792).
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Of course, this all presumes that Senator John McCain doesn’t have another sudden change of heart when it comes time to actually cast his vote.
- The Dumbing Down Of America: "The Numbers Speak Volumes"
Authored by Mac Slavo via SHTFplan.com,
Almost everyone can see that the dumbing down of America is in full effect. A video breakdown of a Psychology Today piece from 2014 which details the anti-intellectualism most of us have already experienced in some way.
According to Signs of the Times, there has been a long tradition of anti-intellectualism in America, unlike most other Western countries. Richard Hofstadter, who won a Pulitzer Prize in 1964 for his book, Anti-Intellectualism In American Life, describes how the vast underlying foundations of anti-elite, anti-reason, and anti-science have been infused into America’s political and social fabric. Mark Bauerlein, in his book, The Dumbest Generation, reveals how a whole generation of youth is being dumbed down by their aversion to reading anything of substance and their addiction to digital “crap” that is composed on social media.
Joe Joseph from The Daily Sheeple breaks it down in his new video.
“You have plenty of these experts that are basically sounding the alarm,” he says.
“Let’s keep it simple,” he continues. “I ask everybody a very simple question. If you think about what you learned from grade K to grade 12, give yourself a percentage of how much of that you actually use in your everyday life. Out of all of that information…now think about how much of your life experience weighs in.”
Joseph then goes over the statistics that have been compiled which are evidence of Americans getting dumber by the decade. Part of that, is because of the declining quality of higher education. After leading the world for decades in 25-34-year-olds with university degrees, the U.S. is now in 12th place. The World Economic Forum ranked the U.S. at 52nd among 139 nations in the quality of its university math and science instruction in 2010.
According to the 2009 National Assessment of Educational Progress, 68% of public school children in the U.S. do not read proficiently by the time they finish third grade. And the U.S. News & World reported that barely 50% of students are ready for college-level reading when they graduate:
We’re creating a world of dummies. Angry dummies who feel they have the right, the authority and the need not only to comment on everything, but to make sure their voice is heard above the rest, and to drag down any opposing views through personal attacks, loud repetition and confrontation. –Signs of the Times
The new elite are the angry social media posters; those who can shout loudest and more often, a clique of bullies and malcontents baying together like dogs cornering a fox.
Rational thought is the enemy, says Bill Keller, writing in the New York Times.
- Hamas Torturing Militants In Crackdown On "Unauthorized" Rocket Attacks Against Israel
The Palestinian militant group Hamas which governs the Gaza Strip has reportedly initiated a crackdown on Salafist fighters within its ranks who are responsible for instances of unauthorized rocket fire into Israel, which has been sporadic in the last two weeks since President Trump's contentious recognition of Jerusalem as the Israeli capital on December 6th.
The Times of Israel cites Hamas media statements as well as unnamed intelligence sources to report that the group has arrested a growing number of Islamist militants in recent days amidst the crackdown and further that some among them were likely tortured in an effort to clamp down on the attacks, which have invited devastating air and tank counter assaults by Israeli forces on Hamas locations.
"According to Hamas, among those arrested were operatives responsible for the recent rocket launches. It’s likely that some of these men were tortured by Hamas’ security people," the report states. Hamas is further signaling to Egyptian intelligence and other regional Arab governments that it wishes to avoid escalation with Israel according to the report.
Hamas militants. Image source: AFP/FileSince protests began across the West Bank, Gaza, and Jerusalem earlier this month which quickly escalated into outbursts of violence, Hamas affiliated factions have launched almost 30 rockets – half of which have entered Israel (others falling short within Gaza territory), with at least two hitting populated areas within southern Israel. Many of the rockets have been successfully intercepted by Israel's Iron Dome missile defense system, however a number have made it through Israeli defenses.
Meanwhile, Israeli media now tallies about 40 Israeli Defense Forces (IDF) strikes on Hamas positions over the past two weeks. Thus far no Israelis have died while at least eight Palestinians have been killed (including two militants who reportedly died in an accidental blast while transporting explosives). The most recent rocket attacks from Gaza were Sunday night, for which the IDF retaliated on what the Israeli military described as a Hamas training compound in the northern Gaza Strip.
The IDF has repeatedly warned that it would hold Hamas directly responsible for all "hostile activity" and threats coming from Gaza – though Israeli airstrikes on the densely populated Gaza Strip have been notorious for causing mass civilian casualties among the Palestinian population, who often have nowhere to flee outside the confines of the relatively small strip of land that comprises Gaza territory.
But it appears that the political leadership on both sides wishes to avoid a scenario which leads to a repeat of Operation Protective Edge or other similar IDF incursions into Gaza before it. During Operation Protective Edge the United Nations reported that at least 2,104 Palestinians died, which included 1,462 civilians, of whom 495 were children and 253 women. The 2014 Israeli Army incursion into Gaza lasted seven weeks, and 66 Israeli soldiers died during the operation, as well as seven civilians killed in Israel due to rocket fire from Gaza.
Map source: BBCPast major military conflicts between Israel and Hamas have started precisely through the kind of gradual tit-for-tat strikes and counter-strikes we are seeing now. However, according to Israeli media reports, intelligence assessments see Hamas' declarations that it will prevent rogue or unaccounted for rocket attacks on Israel as legitimate.
According to the Times of Israel:
The Israeli intelligence community is sticking to the assessment that Hamas doesn’t seek a conflict with Israel that would deteriorate into a broader war. Still, the fact that Hamas hasn’t stopped the periodic fire for nearly two weeks raises the question of whether the launches stem from Hamas’ inability to enforce quiet or from its security forces’ lack of motivation to do so.
Should reporting of the Hamas internal crackdown be legitimate, there's still the question of whether broader Palestinian anger will tolerate the potential "moderation" of Hamas leadership, especially as tensions are set to intensify this week with Vice President Mike Pence's visit to Israel so soon after Trump's bombshell declaration on the status of Jerusalem. Pence is expected to land in Jerusalem Wednesday, and the trip will include a contested visit to the Western Wall, which administration officials have promised will remain under the sovereignty of the Israeli state in any future agreement.
The trip will also come after Monday's UN vote, which pitted the United States against all other members of the UN Security Council in a 14 to 1 decision with the US as the lone veto blocking a resolution calling for the withdrawal of President Trump's recognition of Jerusalem as the Israeli capital. Nikki Haley was reportedly furious over the resolution, calling it an "insult" and saying the US won’t be told where it can put its embassy.
And within Isreal, Prime Minister Benjamin Netanyahu is facing harsh criticism from opposition Labor party politicians for perceived inaction against Gaza's militants as well as the accusation that the country's "weak" leadership has lost the advantage of "deterrence".
- Is The FBI An Enemy Of Freedom?
Authored by Scot McPherson via The Future of Freedom Foundation,
Former FBI special agent Clint Watts has responded to tweets from President Trump critical of the FBI by branding the president an “enemy of the state.” Watts claims Trump’s tweets will “sow doubt” and “hurt” the abilities of the FBI, “so he is an enemy of the state whenever he is pushing against the FBI in that way,” he concluded.
With the possible exception of the BATFE, it would be hard to imagine an entity within the federal government more out of control and in need of — dare I say it? – abolition.
Getting rid of the FBI would be a giant boon for the freedom of the American people. As President Harry S. Truman put it, “We want no Gestapo or secret police. The FBI is tending in that direction.”
For its entire existence the FBI has served as the strong arm of the federal government. Beginning in 1909 as the Bureau of Investigation, no one’s life, liberty, or property has been safe since. Ostensibly created to investigate anarchists, bootleggers, kidnappers, bank robbers, crimes on federal property, and later, the KKK, the FBI would soon find its true calling: political repression, personal destruction, and terror.
Communists, real and imagined, were the first to find themselves under the FBI’s ominous glare. World War II provided an opportunity for the FBI to serve a legitimate role, by investigating acts of espionage, but that would take a backseat to mass arrests of innocent Japanese Americans and warrant-less searches of their property.
J. Edgar Hoover, the first FBI director and its longest serving, then began compiling a list of “sexual deviants” in April 1950 so that homosexuals could be purged from the federal workforce.
Hoover disliked civil rights leaders as well, and the FBI’s COINTELPRO – for “counter intelligence program” – targeted Martin Luther King, Jr. and the Southern Christian Leadership Conference.
The FBI was also linked to political assassinations in the 1960s, including that of Illinois Black Panther Party leader Fred Hampton in Chicago, and the wiretapping of congressional offices.
To protect its Mafia informants, the FBI allowed four innocent men to be imprisoned for life in 1965 (two would die there); forty years later a congressional committee called it “one of the greatest failures in the history of federal law enforcement.”
The Bureau’s record of failure would only continue, and grow more tragic.
In the early 1970s the FBI sought to undermine the American Indian Movement (AIM) by supporting a corrupt tribal leader at the Pine Ridge Reservation in South Dakota, Richard Wilson, who formed a private militia to intimidate his political opponents. In the case of Leonard Peltier, an AIM activist and outspoken critic of Wilson’s, allegations were raised that FBI agents threatened a witness in order to secure Peltier’s murder conviction in 1977.
In September 1992, an FBI sniper killed the wife of Randy Weaver as she stood at the door of her family’s cabin in Idaho, unarmed and holding her ten-month-old baby.
In April 1993, the FBI used a tank to attack the Davidian complex outside Waco, Texas, after a fifty-one day standoff. All seventy-six people inside died in the resulting fire. The FBI claimed for years that no incendiary devices were used in the assault, but an investigation by William Gazecki proved this to be false. In 1996 the FBI leaked the name of Richard Jewell in connection with the Olympic Park bombing in Atlanta. He was hounded mercilessly by the media. Ultimately he was completely exonerated.
The FBI’s shady deals and shoddy work would ooze into the next century. An internal report in 2003 called into question thirty years of bullet sample evidence collected and analyzed by the Bureau. Yet a full year would pass before the FBI ended its corrupted practice, and not until 2007 would the agency identify the three decades of cases (!) affected and notify prosecutors that potentially flawed testimony was used. In the war on terror, the FBI has become associated with highly questionable tactics, providing encouragement and resources, even bribes, to manufacture “terrorist” suspects who later provide glowing headlines and boost budgets for the FBI.
What place does a FBI have in a free society? No place.
- Kroger And Walmart Try More Gimmicks To Thwart Amazon; They Will Fail…Again
Over the summer, we argued that the grocery business in the U.S. is, and always has been, a fairly miserable one. From A&P to Grand Union, Dahl’s, etc., bankruptcy courts have been littered with the industry’s failures for decades.
The reason for the persistent failures is fairly simple…razor-thin operating margins that hover around 1-3% leave the entire industry completely incapable of absorbing even the slightest financial shock from things like increasing competition and food deflation.
Meanwhile, if these retailers have difficultly absorbing even the slightest changes in competition and food inflation, you can only imagine how the efforts of Amazon to slash in-store employee headcounts, a line item which Kroger spends roughly 17% of their revenue on, might impact the fragile industry. Unfortunately, at least for the traditional grocers of the world, a completely automated shopping experience may be closer than they had hoped just a couple of years ago.
All that said, the likes of Kroger and WalMart hardly plan to cede their grocery market share to Amazon without a fight. So how do they plan to compete against a technologically superior new entrant that can offer all the same services but with a small fraction of the employee overhead…well, by adding more employees of course.
As Reuters points out today, both Kroger and WalMart are ramping up their “curbside pickup” programs which allow customers to place orders online then simply drive up to the grocery store and wait while an employee loads their order into the trunk.
As Amazon.com looks to upend the U.S. grocery market with home delivery, some veteran supermarket operators are betting on a different strategy: curbside pickup. Americans have long loved the convenience of drive-through service for burgers and coffee. Kroger Co (KR.N) and Walmart Inc (WMT.N) are tweaking that formula for groceries.
The companies have invested heavily in online systems that allow customers to order ahead from their neighborhood store. Workers pick and pack the products, then run them out to shoppers in the parking lot, the grocery version of carry out pizza. For the retailers, the service is cheaper than delivery, because customers do the driving. For shoppers, it means skipping crowds and queues at their local market, and no worries about missing packages or melted ice cream if they are not at home to meet the delivery guy.
Tony Sacco, who lives in the Los Angeles beach community of Playa Del Rey, is a regular user of the service at a nearby Ralphs supermarket, owned by Cincinnati-based Kroger. Each pickup costs $6.95, but the time-crunched married father of three says it is worth it.
“This is easy. Time is money,” said Sacco, 47, as a worker loaded bags into his SUV on a recent morning.
Unfortunately, such programs don’t implement any new technology but rather rely on an army of new “pickers” that run around the store fulfilling customer orders while adding a fortune in costs to the P&L. And while these chains are presumably betting on market share gains to offset the higher per store employee costs, given that there are no barriers to other retailers implementing the exact same strategy, we’re going to go out on a limb and bet that those market share gains will remain elusive on future earnings calls.
Of course, this is not to say that curbside pickup won’t play a role in the future of grocery retailing. In fact, Amazon is likely to implement such a strategy as well…the only difference is that your curbside order from Amazon won’t be packed by a $15 per hour minimum wage worker but rather a robot that performs all the same functions but works works for free, doesn’t require a pension and never takes a vacation day…
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