May 05

Today’s News 5th May 2018

  • What May 2018 Has In Store: It's Difficult To Understate The Looming Dangers

    Authored by Peter Korzun via The Strategic Culture Foundation,

    The month of May is always associated with V-E Day. The sentiments of “never again” were strong 73 years ago, in 1945 when the UN was founded. Since then Europe has put a huge amount of effort into creating a unique security system to prevent armed conflicts. It was never perfect, but by and large it worked. Other continents used to look on with envy and try to establish security regimes of their own.

    Multiple agreements are still in force, working to prevent the worst scenarios, but today they appear to be somewhat forgotten and are failing to meet their objectives. Yet by no stretch of the imagination would anyone have imagined that May 2018 would be a month spent teetering on the brink of war, with the experts left trying to guess when it will ignite, how far it will spread, and how many actors are likely to be involved. It’s scary but that’s where we are. It’s never been this tense since the worst days of the Cold War.

    On May 2, Siil (Hedgehog), the largest NATO exercise to be held in the Baltics since 1991, began in Estonia and Latvia, involving 3, 000 troops from 16 countries. It will last until May 14. Estonia and Latvia border the Russian Federation. Latvia will host five military exercises in May and June. All of this activity is intensive enough for Moscow to interpret it as preparation for war.

    June will see large-scale BALTOPS and Sabre Strike 2018 exercises in the Baltics. Europe will host a US armored brigade – a force of at least 4,000 soldiers accompanied by about 90 Abrams tanks, Bradley combat vehicles, 18 self-propelled Paladin howitzers, and other vehicles.

    The largest-ever NATO exercise, Anakonda 2018, will be held in Poland this summer. This is the biggest event staged by the alliance since the end of the Cold War and will include about 100,000 troops, 5,000 vehicles, 150 aircraft and helicopters, and 45 warships. Such a huge force will naturally make Russia wary. The NATO Air Policing was stepped up last month. The alliance will conduct 80 joint exercises in Europe this year, mainly aimed at prepping for a war with Russia.

    This intensified training is taking place at a time when the Donbas conflict in Ukraine is really heating up. The escalation of tensions is coming on the heels of the US deliveries of Javelin antitank systems to the Ukrainian military. This is the first transfer of lethal weapons.

    On May 1, the US State Department released a statement announcing that the American military is shifting to a new phase in its Syria operation. The US-led coalition, the SDF, and its mysterious “local partners” are to be involved. Turkey, Israel, Jordan, Iraq, and Lebanon have also been mentioned as having a role. The Islamic State has not been much of an issue for Beirut, but now Lebanon is very likely to become a battlefield that will draw in many actors, especially Israel and Iran.

    Officially the mission is intended to sweep away the remnants of the Islamic State (IS) forces, but that claim should be taken with a grain of salt. Whatever is left of IS is insignificant and can be dealt with without the help of the US-led coalition. The situation in Syria is very explosive now that the US has ratcheted up the tensions instead of pulling out as President Trump said he wanted to do. A wider conflict is right around the corner there. The US-led SDF and the Syrian regular forces have recently been involved in direct clashes — a very worrisome development and coinciding with the Israeli airstrikes against Syrian and Iranian forces.

    These war preparations are taking place at the same time that Prime Minister Netanyahu is accusing Tehran of allegedly cheating on the nuclear deal. The US was quick to claim that the evidence was “compelling.” The Israeli parliament has just voted to grant the prime minister the authority to declare war or to order a major military operation without the prior approval of his security cabinet.

    US President Trump is widely expected to decertify the Iran deal on May 12 and pay a high-profile visit to Israel when the new US embassy’s provisional site in Jerusalem opens on May 14. The opening ceremony will be the right place and time to announce new moves against Iran — a country that works closely with Russia in Syria and elsewhere.

    All the events taking place in Europe and Syria have a direct impact on Russia’s security. A spark is enough to kindle a conflict in Europe.

    The never-ending NATO exercises and other operations conducted right up against Russia’s borders are extremely provocative. A war against Iran in Syria appears to be almost certain, since Russian forces are deployed near Iranian positions. It will be next to impossible to strike Iranian or Syrian sites without provoking the Russian military into taking measures to defend itself. A single strike against Iranian forces could be contained but a military campaign against them will inevitably put Russian personnel at risk. Russia has some very formidable military forces positioned in Syria that must be a serious factor in any war scenario.

    Tensions are running high in Europe and a wider conflict could ignite at any time in Syria. In either situation it won’t be Russia that provokes the explosive situations that threaten to deteriorate into a full-blown conflict.

  • Facebook Co-Founder Wants To Slap $3 Trillion Tax On Rich To Pay For Universal Basic Income

    Facebook co-founder Chris Hughes wants to tax anyone who makes over $250,000 to the tune of nearly $3 trillion over ten years, then use the proceeds to provide universal basic income (UBI) to every working American who makes under $50,000 a year, including those providing services such as child care and elder care. 

    Hughes, 34, now devotes his time to evangelizing for higher taxes on the rich, such as himself. He’s proposing that the government give a guaranteed income of $500 a month to every working American earning less than $50,000 a year, at a total cost of $290 billion a year. This is a staggering number, but Hughes points out that it equals half the U.S. defense budget and would combat the inequality that he argues is destabilizing the nation. –Bloomberg

    Hughes, who has a related book coming out, has made tackling income inequality his top priority by partnering with the Economic Security Project – a major recipient of his philanthropic efforts. The group is focused finding solutions to provide “unconditional cash and basic income” in the United States due to the effects of “automation, globalization, and financialization” forcing the discussion. 

    The plan would essentially be an expansion of the Earned Income Tax Credit (EITC) for low-to-moderate income individuals and families.

    The Economic Security Project is a network committed to advancing the debate on unconditional cash and basic income in the United States. In a time of immense wealth, no one should live in poverty, nor should the middle class be consigned to a future of permanent stagnation or anxiety. Automation, globalization, and financialization are changing the nature of work, and these shifts require us to rethink how to create economic opportunity for all. –Economic Security Project

    While Hughes notes that the annual $290 billion annual price tag is half the U.S. defense budget, he contends that income inequality is destabilizing the nation – and that there is a “very practical concern that, given that consumer spending is the biggest driver of economic growth in the United States and that median household incomes haven’t meaningfully budged in 40 years,” a Universal Basic Income is vital to maintaining economic national security.   

    “Cash is just the simplest and most efficient thing to eradicate poverty and stabilize the middle class,” Hughs told Bloomberg at the Economic Security Project’s New York offices at Union Square.

    There are many ways to pay for a guaranteed income. However, I do think that the resources can and should come from the people who most benefited from the structure of the economy. We had tax rates at 50 percent for several decades after [World War II]. In the same period, we had record economic growth and broad-based prosperity. I’m not making the case, in the book and in general, that we just need higher taxes. It matters what our tax dollars are going to. Cash is just the simplest and most efficient thing to eradicate poverty and stabilize the middle class. –Bloomberg

    You can read the rest of Bloomberg‘s interview with Hughes here. 

  • In Bizarre Tweet, Elon Musk Threatens Shorts With "Unreal Carnage"

    Two days after the “most unusual conference call in 20 years”, in which Elon Musk cut off questions from Bernstein and RBC research analysts, the Tesla CEO’s descent into some “unstable genius” abyss is, unfortunately, accelerating.

    It started very late on Thursday Pacific time, when perhaps unable to procure ambien, Musk took to twitter (after spending the entire night in the factory) and in a series of disjointed, rambling tweets attacked the research analysts (who were merely doing their work, seeking more information on Tesla’s CapEx plans and Model 3 rollout) whose assault prompted Musk’s erratic behavior that led to a plunge in Tesla stock on Thursday, one Musk may have instigated himself after telling “daytraders” who can’t take the volatility to sell Tesla stock.

    In his first overnight tweet, in what would soon become a tweetstorm worthy of Donald Trump, Musk “explained” that he had cut off the sellside analysts because, get this, they were “trying to justify their Tesla short thesis” (both have Tesla as a Hold).

    The “dry” questions were not asked by investors, but rather by two sell-side analysts who were trying to justify their Tesla short thesis. They are actually on the *opposite* side of investors. HyperChange represented actual investors, so I switched to them.

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    Musk then doubled down in a later tweet saying “The 2 questioners I ignored on the Q1 call are sell-side analysts who represent a short seller thesis, not investors”

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    Then, even more bizarrely, in the very next two tweets Musk contradicted himself, saying the analysts were cut off not because “they represent a shot seller thesis”, but because they were too lazy to read the company’s press release, or “boneheaded” not to believe that a company which has delayed production targets every quarter for the past year, will be able to hits it ambitious goals.

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    At this point it is worth pointing out that there is no way Musk does not know that sellside research is fundamentally useless – that’s why the buyside does its own research – and only exists to facilitate meetings between asset managers and company management (which leads us to assume that there certainly isn’t a line of people waiting to speak to Elon). As such, taking the analysts’ questions as personally as he did merely indicates that there is something very troubling with Musk’s otherwise impeccably rational thought process.

    Going back to Musk’s tweets, for a second it almost appeared that Elon’s bizarre, childish tantrum may finally be ending when in response to a question on twitter, Musk admitted that “I should have answered their questions live. It was foolish of me to ignore them.”

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    The fact that it took Musk 48 hours to grasp this is by far the biggest red flag about Elon’s fragile state of mind. Had Musk simply left it at that, the whole bizarre episode may have been on its way to being forgotten, attributed to Musk’s occasionally infantile absurdities.

    Only it was not meant to be… and in the very next tweet Musk took direct aim at his perceived mortal enemies, the Tesla shorts, when he threatened that the “short burn of the century [is] comin soon. Flamethrowers should arrive just in time.”

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    At this point, just after 6am PT, the hyperventilating Tony Stark decided to finally go to bed.

    Unfortunately, any hopes the much needed sleep would have helped him see things more clearly were dashed when after waking up several hours later, Musk appears to have read an article that made him go apeshit.

    The article in question was from Barrons, and pointed out that despite “his tweet storm in which he defended his remarks and hit out against short sellers”, or perhaps due to, Tesla short interest just hit an all time high:

    Short interest in the stock increased by nearly 400,000 shares on May 3, the day after the report, bringing the total to more than 40 million shares for the first time in Tesla’s history, notes S3 Partners’ Ihor Dusaniwsky. Moreover, despite Musk’s remarks today and the stocks’ gain, shorts rose by half a million shares Friday.

    Adding insult to injury, author Teresa Rivas touched on a very sensitive topic for Musk – supply vs demand – pointing out that there may not be any more shortable TSLA shares soon

    All of which means that Tesla customers and shorts may have something in common, says Dusaniwsky: More demand than supply. Not all long shares are in stock-lending programs, and given the high short interest at the moment, that leaves just 6.5 million shares for expanded short positions.

    At this point, Musk, who over the past 72 hours has sounded like he is having an acute psychotic episode or merely a mental breakdown, again took to twitter and in his best Trump impression, let his fingers do the talking before his brain could stop them, and sent out another “message” to the record shorts, this time even more cryptic than before, saying “Looks like sooner than expected” and while it wasn’t clear what he was referring to, the context made it clear that this was a continuation of his previous tweet about the “burn of the century” headed for the shorts.

    He then clarified his hyperbolic threat: “The sheer magnitude of short carnage will be unreal.” and concluded with some friendly advice: “If you’re short, I suggest tiptoeing quietly to the exit …“

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    And then, in response to a Twitter remark which may or may not have been sarcastic, “You seem very concerned by shorts these days… That is very kind” Musk pulled out the noble humanitarian card, saying he just wants to help the shorts:

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    With that, Musk’s tweetstorm has – for now – concluded, although we doubt it has ended, because unlike Trump, Musk actually does respond to taunts and provocations on Twitter, and after this particular threat, the CEO of the company that just burned another $1 billion in three months will be bombarded with both.

    And while it still remains to be determined who will be the winner in the end of this increasingly surreal, absurd saga – Musk or his mortal enemies, the shorts – one thing is clear: things have certainly changed from the simpler days of “Stormy weather in Shortville …”

  • How Often Do Freelancers Get Paid Late? It Depends If You’re A Woman Or Man

    Submitted by Priceonomics

    It seems obvious that you should get paid for the work you do.

    Unfortunately that’s not always the case for freelancers. In addition to irregular income streams and projects, freelancers have to deal with clients that don’t pay on time. This makes an already hard job even harder.

    Freelancers assume late payments are a professional hazard, but just how common are they, and what factors influence whether a freelancer is paid on time?

    Bonsai, which provides business management and automation tools to 100,000+ freelancers, analyzed 3 years of invoicing data to find out. The invoices covered all types of work, from digital design and development to photography and marketing. That data includes demographic info on the freelancers themselves, as well as info on their projects and payments.

    Some of the findings weren’t surprising: 29% of invoices were paid late. 

    Other data points were more shocking: female freelancers were paid late 31% of the time, versus 24% of the time for male freelancers. We also learned that cryptocurrencies are terrible payment methods for freelancers, resulting in almost 3x more late payments than other payment options like bank transfers.‍

    29% of freelance invoices are paid late

    We started by looking at how likely a freelancer’s invoice is to be paid late. We counted an invoice as paid late as one that one paid even one day past the due date. Most freelancers give clients 2 to 4 weeks to pay an invoice once it’s sent.‍‍

    We found that 29% of invoices were paid after they were due. Over 75% late invoices were paid within 14 days of the due date, and 90% were paid within a month. However, even these delays could significantly hamper a freelancer’s ability to pay for necessities like rent and groceries.

    Clients pay late for many reasons. They can simply be busy, which affects all companies, from the bureaucratic slowness of large organizations to the hectic disorganization of small ones. Clients can also be bullies, who see freelancers as powerless to enforce on time payment. Freelancers can also be to blame if they don’t set and stick to a clear payment schedule.‍

    Female freelancers get paid late more often than male freelancers.

    However, certain factors influence late payments regardless of the freelancer’s abilities or client’s size.

    The most unfortunate of those is the gender of the freelancer. 31% of female freelancers’ invoices were paid late, while 24% and 23% of men and studios’ invoices were paid late.

    This effect persisted even when we controlled for the freelancer’s skill set or experience and client’s size.

    Want to get paid on time? Avoid cryptocurrencies.

    How a client pays a freelancer also significantly influences whether that invoice was paid on time. Payment via cryptocurrencies were late almost 3 times more often than those with ACH or bank transfer.

    These late payment rates were the same even when we accounted for the slower processing time of ACH / bank transfer (up to 7-10 business days) versus the relatively quick transfer times of bitcoin. Unsurprisingly, cash and check are also a slow payment method, given the friction needed for the client to withdraw cash or physically write and deliver a check. Common digital payment methods, such as credit and debit card via Stripe or Paypal represented the average.‍

    Freelancer Marketers are most likely to be paid late.

    Another interesting finding is how the type of work a freelancer does influences their likelihood of being paid late. While many would expect higher earning freelancers like software developers and designers to be paid on time, they were paid late 29% and 28% of the time, while more traditional freelancers like writers and photographers enjoyed relatively fewer late payments (26% and 24% respectively).

    There are several hypotheses for why freelancers or certain skills are paid on time more than others. It can do with the fact that writers and photographers have a more defined work product to turn over (a blog post or an essay), and can use that as leverage in payment. Designers and developers have also relatively higher earning than writers and photographers, so it can also be that they have more of a cash buffer and are more willing to let late payments slide. For more information, check our study on freelance rates to see how rates differ across skills, experience and locations.

    Larger Invoices Get Paid Later

    Lastly, the size of the invoice has a very clear and linear effect on its late payment rate. The larger the invoice, the more likely it was to get paid late. The largest invoices of over $20,000 were 3 times more likely to be paid late than an invoice of under $100.‍

    This likely has to do with the steps and authorization necessary for clients to pay larger amounts. Interestingly, we found little relationship between payment size and payment method. Some clients will happily pay a $15,000 invoice with a credit card, while other prefer a bank transfer for even $150 invoices.‍

    Freelancing can be a rewarding career: you get the flexibility to set you own path and control your destiny. However, these benefits come with risks, especially getting paid late. You can do things like avoid payment via cryptocurrencies or invoicing for large amounts at once, which make you 3 times more likely to get paid late than other payment methods or small invoices.

    However, some things, such as your type of work or even your gender, can be harder to change but just as impactful on your payment prospects. Unfortunately for freelancers, it’s not just the work you do, but how you charge and who you are, that determines whether you get paid on time.

  • UN Secretary General Warns Scrapping Iran Deal Could Lead To "World War III"

    UN Secretary General Antonio Guterres offered a chilling message to the world during a recent interview with BBC Radio: The risk of “World War III” breaking out in the Middle East is intensifying at an alarming rate.

    As we’ve previously speculated, the combatants in the conflict that Guterres envisions would be the US, Israel and Saudi Arabia on one side, aided by some of their allies in Western Europe, and China, Russia and Iran on the other. What’s worse, Guterres warned that the collapse of the Iran deal could be the catalyst for a military conflict that morphs into the next global confrontation.

    Unless the agreement is preserved, the world will likely descend into chaos, he said.

    “The risks are there. I think we need to do everything to avoid those risks.”

    “I believe the JCPOA was an important diplomatic victory and it is important to preserve it. I also believe there are areas in which it would be very important to have a meaningful dialogue because I see the region in a very dangerous position.”

    President Trump has the opportunity to avert this horrifying future, Gutteres said – all he would need to do is preserve the JCPOA until a better deal can be worked out. Perhaps the deal’s signatories could work out something similar to the “four-part” supplementary agreement outlined by Emmanuel Macron  during a press conference with President Trump.

    Gutteres added that while he understands concerns about Iranian influence and the country’s nuclear program, a reference to Israeli Prime Minister Benjamin Netanyahu’s recent presentation about Iran’s alleged attempts to conceal a nuclear weapons program, the Iran deal is an “important achievement” that should be preserved.

    “I understand the concerns of some countries in relation the Iranian influence in other countries of the region. I think we should separate things. I think that this agreement is an important achievement. If one day there is a better agreement to replace, it’s fine, but we should not scrap it unless we have a good alternative.”

    During his tour of the West last month, MbS expounded upon the dangers posed by Iran and even went so far as to compare Ayatollah Ali Khamenei to Adolf Hitler.

    “Hitler didn’t do what the supreme leader is trying to do. Hitler tried to conquer Europe. But the supreme leader is trying to conquer the world,” he said.

    Of course, this hard-line stance hardly bodes well for world peace. While negotiations continue, it’s widely believed that President Trump will scrap the Iran deal on May 12 by refusing to renew the sanctions waivers – though he would then have a few options to continue with negotiations before the most draconian sanctions kick back in.

  • Peter Schiff Rants Bernie's Guaranteed Jobs Program Is "Utter Nonsense"

    Authored by Peter Schiff via SchiffGold.com,

    Bernie Sanders wants everybody to have a job with health benefits paying $15 per hour. Most people would like to see that happen. But Bernie is willing to put your money where his mouth is. He’s come up with a plan guaranteeing every American worker “who wants or needs one” such a job. Here’s how the Washington Post described the proposal.

    Sanders’s jobs guarantee would fund hundreds of projects throughout the United States aimed at addressing priorities such as infrastructure, care giving, the environment, education and other goals. Under the job guarantee, every American would be entitled to a job under one of these projects or receive job training to be able to do so, according to an early draft of the proposal.”

    According to a representative from Sanders’ office, the senator has not come up with a cost estimate for the proposal or decided how a government this is more than $21 trillion in debt would fund such a program.

    As Peter Schiff put it in his latest podcast, Bernie Sanders has come up with a lot of dumb ideas, but this one is probably the dumbest. 

    This is ridiculous. What an asinine idea… The fact that Bernie Sanders, who is a US senator, could propose such utter nonsense. I mean, we have senators who are basically complete ignoramuses when it comes to a basic understanding of economics or the role of government. Bernie Sanders may be a socialist, but the United States of America is not a socialist country. This is a socialist concept – that the government is going to employ everybody.”

    Wrap your head around this. Bernie could have been president. If the Democratic Party hadn’t been in the tank for Hillary, he might have won the nomination, and he may well have been able to beat Trump.

    So, he could have been president. A guy that thinks the government should employ everybody and pay them $15 per how. Think about how ridiculous this is.”

    Peter outlined a number of obvious problems with this scheme. In the first place, what are all of these people going to do to warrant a $15 per hour wage? A lot of them likely have no skills. Is the government going to train them? Are they going to get paid while they’re being trained? Who is going to assess all these people to determine what kind of job they should be able to do?

    And Peter pointed out an even more fundamental point – the goal of an economy is not just jobs.

    We don’t want jobs just so people work. The goal is the production – that is the product of those jobs. Jobs is a means to an ends. If the government hires a million people to dig ditches and then another million people to fill the ditches back up again, those are 2 million jobs. But we’ve got nothing to show for it. We’ve produced zero. So, those jobs are a drain. We are wasting resources. We’re wasting money. Nothing is being accomplished.”

    Some will argue the government will put people to work doing valuable tasks and making necessary products. But how will it know without a profit incentive? How do we know how to best use resources with no market-based information? It will end up being nothing more than a bunch of politicians throwing resources at pet projects that may or may not beneficial or even necessary.

    Here’s another question. What’s the motivation for the “worker?”

    If you’re working for the government and your job is guaranteed, do you have to show up? They can’t fire you. If they fire you, you’re guaranteed a job … No matter how shitty you do that work, you’re going to get that job. So, can you imagine the quality of the work that would be performed by workers who know that no matter what they do they can’t be fired?”

    The labor participation rate is at a very low level right now. You’re talking millions of Americans who don’t have jobs. Let’s say all these people show up for one of these $15 per hour jobs. How is the government going to pay for this? It will cost trillions of dollars. The feds can raise taxes. But if everybody is working a government job, they will be effectively paying themselves. When the government takes money from its own employees, it’s not getting money that it didn’t already have. The only real tax base is the private sector. And Bernie’s little scheme would wreck the private sector.

    Consider the impact on private employers. If you’re making $10 an hour working for a private company, wouldn’t you just quit and go grab a $15 per hour government job?

    If you’re a private employer, you’re going to have to pay your workers at least $15 per hour, probably more. If you’re working for a private company, you’ve still got to show up on time and you might get fired. So why not just work for the government where you can show up whenever you want. So, in order for a private employer to get somebody not to take a cushy $15 per hour, no-show government job, maybe they’ll have to pay $20 per hour to get somebody to actually have to do work.”

    Of course, private companies can’t just print money to make payroll like the government. They’ll have to raise prices or just go out of business. They will also outsource and automate, which will mean even more people needing a guaranteed government job.

    The end result of all of this would be a totally government-run economy.

    I think if this law were to get passed, pretty soon they would drive out all private employees. I think everybody would want to work for the government.

    There would be no one left working in the private sector. So, there’d be nobody to tax. So, that means all of these $15 per hour jobs with benefits would be worthless because you’d have nothing to buy with your wages because there would be no real productivity in the economy. We would have a complete socialist society or a communist government. Everybody would be working for the government. The government would have to decide what everybody does. They would be in charge of allocating all of the resources. You do this. You produce that. I mean it would be a complete command economy and it’ll be a complete disaster.”

     

  • More Than 4 Million Americans Have Lost Health Insurance Since 2016

    Even before the GOP killed Obamacare’s individual mandate back in December as part of their tax-reform plan, the number of Americans going without health insurance had been rising.

    Obamacare

    And now, according to a recent study, the number of uninsured US adults between the ages of 19 and 64 climbed to 15.5% in March 2018 compared with 12.7% in 2016. That’s tantamount to 4 million people losing insurance, according to CBS.

    The number of uninsured adults between the ages of 19 and 64 rose to 15.5 percent in March 2018, up from 12.7 percent in 2016. An estimated 4 million people lost individual coverage during that period, while the number of people with employer-sponsored coverage stayed steady.

    Adults with lower incomes – about $30,000 for an individual and $61,000 for a family of four – saw a much higher increase: 25.7 percent in March 2018 compared to 20.9 percent in 2016.

    Perhaps the biggest contributor to rising uninsured rates, according to the study, is the coverage gap, which leaves poor Americans in many states unable to afford health insurance. The gap first emerged in 2012, after the Supreme Court ruled that Obamacare’s mandate forcing states to expand Medicaid was “unconstitutionally coercive”.

    The biggest increases in uninsured rates in recent years have occurred in states that did not expand Medicaid, which shouldn’t come as a surprise.

    Another factor may be related to the so-called coverage gap. When the ACA was passed, it mandated that all states expand their Medicaid coverage, including increasing qualifying income limits. At the same time, the ACA ruled that people whose income fell below 100 percent of the poverty level would not qualify for the ACA’s government subsidies to help pay health insurance premiums. The assumption was these people would be covered by expanded Medicaid coverage, Collins explained.

    That plan went haywire when the Supreme Court later ruled that states were not required to expand Medicaid coverage but could do so voluntarily. As a result, people in nonexpansion states with incomes below the ACA subsidy limits often don’t qualify for Medicaid. Indeed, the survey found the steepest increases in uninsured rates occurred in states that did not expand Medicaid.  

    Collins predicted the rising uninsured trend is likely to continue. One reason: The repeal of the individual mandate, which required people to buy insurance or face penalties. The new tax law did away with that provision and eliminated penalties starting in 2019. Commonwealth found that 5 percent of people with insurance are planning to drop coverage once the mandate becomes obsolete. “That’s not a huge number, but it is something,” said Collins. 

    At least one former ACA antagonist is warning that the repeal of the individual mandate was a mistake. Tom Price, former secretary of the Department of Health and Human Services, said during a recent health-care conference in Washington that eliminating the individual mandate would almost certainly drive up premiums. Last year, the CBO forecast that 13 million people would lose coverage if the mandate was eliminated.

    Of course, this trend can’t continue for much longer until Obamacare experiences an all-out collapse as insurers decide that it’s simply no longer worth it to offer health-care plans on the ACA’s exchanges. As premiums soar, more and more people will be forced out of the market, deteriorating risk pools and forcing insurance companies to reconsider their participation.

    In an interview last year, Aetna CEO Mark Bertolini warned about the impending Obamacare “death spiral”, saying “it’s not going to get any better; it’s getting worse.”

  • What Is The Government Doing To Protect Us From An EMP?

    Via SurvivalSullivan.com,

    An EMP attack is the most deadly doomsday proposition we could ever face. Few outside of the prepper community are even pondering such an end of the work event – and far fewer still are preparing to survive such a SHTF and the copious amount of domino mega disaster effects it would create.

    An electromagnetic pulse (EMP) is defined as a brief surge of electromagnetic energy and it can be the result of either man-made or natural disturbances. Electronics can be affected and in some cases an EMP can result in physical destruction of things such as structures and vehicles. After a nuclear explosion, the EMP will radiate abruptly, and is likely to cause unspeakable damage to electrical systems as unnaturally high voltage surges through valves and transistors.

    Let’s break down that very technical and scientific definition of an EMP into practical terms, shall we? The SHTF will epically hit fan in biblical proportion and could forever change life as we know it on planet Earth.

    And….it could happen any minute now.

    That, my fellow preppers, is the deep and dirty mega secrete neither the mainstream media nor government officials are paying enough attention to or want us to know.

    If you grew up watching the Little House on the Prairie and Grizzly Adams like I did and ever wondered what it would be like to live an 1800s style existance, you just might get your chance to find out.

    If (I really should agree with former DHS Secretary Janet Napolitano and say, “when”) an EMP happens, expect a scene like this to begin playing out in your neighborhood.

    An electromagnetic pulse, whether it is caused by an Earth-directed X Class solar flare or a more nefarious man-made attack, WILL fry out fragile and antiquated power grid, anything hooked to it during when the EMP occurs, and ALL sensitive electronic equipment,

    An EMP is a short, but very strong burst, of electromagnetic energy caused by a rapid and intense increase in charged particles in the ionosphere. The acceleration of particles can occur as the result of a solar storm, a nuclear bomb, dirty bomb or an a small scale, even due to a simple, yet strong, bolt of lightning.

    Once the ionosphere experiences a particle surge, a wave of electrical currents emerges and shorts out all, modern equipment which needs electricity to function – including the transformers are necessary to make power grids all around the world, work.

    An EMP disturbance has the capability to not only destroy sensitive electronic equipment, but can even burst power lines, down airplanes, and damage brick-and-mortar structures.

    EMP Classification

    We are all familiar with the government’s hurricane and tornado classification. The same type of scale also exists for electromagnetic pulses.

    E1 – This classification of an EMp is the most brief. An E1 typically lasts for hardly even a microsecond, but is still regarded as being substantially powerful and highly destructive. An E1 EMP would occur after the detonation of a nuclear bomb.

    E2 – This classification of an electromagnetic pulse lasts at least a little bit longer than an E1 and could be caused by a man-made dirty bomb depending upon its capacity, or a nuclear explosion. During a nuclear blast, what would most likely occur is an E1 level EMP would happen followed by an E2 class event. Our power grid might be capable of withstanding an E2 event if it is really as hardened as the government claims, but there is currently no known way to harden the electrical grid (or anything else, for that matter) against an E1 class EMP event.

    E3 – An E3 EMP event is less powerful than either an E1 or an E2. It can last for hours to days, depending upon the originating incident. This is the type of EMP disturbance that commonly occurs due to solar flares during the summer months.

    The Carrington Event

    When the most recent and only recorded EMP provoking solar flare happened in 1859, it was dubbed the Carrington Event. Richard Carrington, an astronomer, watched the EMP unleash its power through his telescope lens and documented the event.

    A monstrous power outage resulted, leaving more than six million people in the dark from Canada through New York to New Jersey. At the time, NASA experts proclaimed the solar flare possessed approximately one-third of the power that the Carrington Event carried.

    Telegraph lines, the most sophisticated type of technological equipment of that era, not only snapped and caught fire, even the papers and desks of operators also burst into flames.

    Scientists often refer to EMPs as a “transient electromagnetic disturbance.” The incidents can be natural disturbances due to solar flares or a man-made current used as part of a weapons system.

    Man-Made EMPs

    An EMP strike is actually more likely to occur than a nuclear bomb or a war because of money and power. Why spend billions on war, manufacturing weapons, training and dispatching soldiers, when you can discharge an EMP attack, wait a few months, and then survey the inevitable damage?

    By simply launching a few SCUD missiles (a storable-propellant, single-stage ballistic first developed by the Soviets) from a ship anchored off the coast, you could unleash a silent, quick, and clean attack on an enemy, without so much as a single bullet. Human nature and the force of evolution will take care of the rest, as populations become defenseless, weak, and increasingly desperate. North Korea claims to have the ability to launch such an attack right now.The bottom line is that an EMP assault is cheaper and less messy for our enemies than anything else.

    Following an EMP attack, financial and communication systems would fail. Transportation systems would derail. The unprepared portion of the population, all 325.7 million of them that are not preppers or already living off grid or on a sustainable homestead, will not be able to cope with the basic needs of daily survival.

    Depending upon the origin of the electromagnetic pulse, a man-made disturbance can stem from an electric, radiated, conducted electric current, or magnetic field. A nuclear EMP attack would be even more devastating than a solar EMP – or coronal mass ejection – CME.

    An EMP attack results when the enemy launches a nuclear bomb – from land or sea – into the Earth’s atmosphere, rocketing to a height of more than 25 miles. The detonation causes gamma rays to interact with air molecules, producing positive ions while recoiling electrons in Earth’s atmosphere.

    The positive ions take over the electrons and a gigantic pulse bursts out towards the Earth below. Simply put, an atomic reaction takes place and the electromagnetic pulse that is created scorches all the electrical devices within a vast radius, including batteries.

    Solar Storms

    The effects of a solar (geomagnetic) storm are often attributed to that of an electromagnetic pulse. While an intense solar storm could potentially damage huge segments of the country’s power grid, it will impact ground level sensitive electronic equipment that isn’t even plugged in. While the effects of a solar storm do match the scientific definition of an EMP, the response it triggers is much slower than the expected speed of a ‘pulse’.

    It is untrue that an EMP has limited range because it follows the inverse square law. This law is, in fact, irrelevant for most nuclear EMP occurrences. This is because, while the detonation of the nuclear weapon may be occur at a great distance, the E1 EMP is produced within the atmosphere, 12 to 24 miles directly above, in the stratosphere region, referred to as the source region by scientists.

    A Coronal Mass Ejection (CME) is a huge burst of gas released from the Sun.This is the organic, natural form of an EMP and it brings the might power to fry electronics along with it. It targets the power grid, blasts power plants, and sends surges of electrical current along the lines, damaging household appliances and simple electronics that are plugged in along with all sensitive high-tech devices.

    A CME lasts only a few hours, but if the Sun emits many of these in several directions, there’s more chance one could collide with the Earth. A CME will have global consequences, disrupting radio transmissions, blasting satellites, and endangering people travelling in airplanes and spacecraft at high altitudes.

    The power grid would only be temporarily disrupted by a solar storm, these types of occurrences happen with fair frequency during the hot months of summer – when you see your television experiencing heavy static and have patchy cell or internet service, a solar storm is likely the root cause. However, geometric currents, triggered by a solar storm, could eradicate much of the biggest transformers worldwide and recovery could stretch over decades.

    It’s only a matter of time before nature unleashes a solar storm. And next time, it could be a big one. Solar flares run in cycles with most scientists in agreement that an X Class Earth directed solar flare occurs about every 100 years. It has been longer than a century since the Carrington Event of 1859 – so we are long overdue for what we, as a society, are ill-prepared and ill-equipped, to survive without a traumatic death toll.

    What Will Stop Working After An EMP

    1. Lights

    2. Gas pumps – meaning tractor-trailers carrying food, water, and medicine will not be able to roll. Nor will emergency responders or the military once their generators and stockpiles of fuel run out – no vehicles with sensitive computer components will be able to move even with a full tank of gas because the EMP will fry the circuits

    3. ATM machines

    4. Cell phones

    5. Computers, laptops, tablets

    6. Televisions

    7. Radios that have not been stored in Faraday Cages

    8. Life-saving hospital equipment

    9. Air conditioners

    10. Electric furnaces

    11. Electric stoves

    12. Microwave ovens

    13. Power tools – not because of sensitive electronic components but because there is no electricity to provide fuel for their tanks or to recharge their batteries once generator power and stockpiles run out

    14. Water pumps, well pumps, and municipal water treatment and utility services

    15. Refrigerators – including the ones needed to keep medicines cool at pharmacies and warehouses and the coolers at grocery stores

    16. Internet

    17. and more

    Because we rely so much on modern conveniences, the sudden deprivation will mean the general populace will be thrown into a state of panic that will rapidly lead to violent civil unrest and the breakdown of society.

    What Other EMP Effects Can We Expect?

    While an EMP doesn’t harm the human body, (with the possible exception of people with pacemakers) one strategic strike launched over Kansas could cripple electrical operations in the United States. Basically, all telecommunications would fail and the country will be plunged into a 19th-century-era darkness with nationwide blackouts, because the power grid will go down immediately after the EMP hits.

    The intensity of the high voltage spikes produced by an E1 surge is based on several factors including location relative to the EMP surge, amount of shielding, as well as object size and energy status at the time.

    The E2 surge is like lightning, but weaker and relatively harmless. Electronic devices already damaged by an E1 are more vulnerable to an E2. The E3 is similar to a geomagnetic storm, lasting several minutes. Unconnected electronics won’t be damaged. Its primary threat is to the power grid, especially the larger transformers.

    Phone, cable TVs and electric lines are the most hazardous when an EMP strikes. External antennas and computer cables are next in line. Smaller electronic devices would be mildly affected and would probably stay intact. A cell phone or wristwatch may be immune to a spike, but only EMP-resistant signal towers will stay online.

    Planes will literally be falling from the sky after an EMP. Their highly sensitive computer components will fail and the approximately 7,000 planes flying above our heads across the country at any given moment, will crash and burn – and no one will be there to put out the flames.

    The spreading of fires from plane crashes as well as from survivors attempting to stay warm, boil water, and prepare food, will causes an insurmountable amount of damage to homes, businesses, crops, wildlife that will need to be hunted for food, etc.

    Shock, disbelief, and then panic will be the first emotions and reactions the general populace (and let’s face it, many areas of our government will be going through the same set of emotions as well) will feel. Once the full impact of the doomsday disaster beings to register, things will get even worse once folks know the lights are not going to come back on for at least months, but more than likely years…if at all.

    With no functioning ATMS, cash will go fast and essentially be deemed worthless overnight. A can of peaches or a bottle of water will become far more valuable than a $100 bill to survivors.

    When the SHTF, looting will occur quickly and bartering will replace cash transactions. Security systems will fail, leaving you and your home vulnerable to intruders because you cannot call 911 for help. You’ll need alternative methods to prepare and refrigerate or otherwise store food. Start canning, stockpiling, and preserving food before it’s too late.

    There are indirect and direct EMP effects. Direct, physical effects include damaged electrical systems. Indirect effects can be more severe and cause widespread chaos. And, the worst part is, it only takes a fraction of a second to fry all electronics.

    The indirect effects of a doomsday disaster, like an EMP, are referred to as “domino effects.” With the exception of a full-scale nuclear war, that is no other SHTF scenario that will bring out more devastating domino effects than an EMP.

    EMP Domino Effects

    1. Economic collapse

    2. Dehydration

    3. Starvation

    4. Fires – raging unchecked because the fire department cannot respond.

    5. Looting and general lawlessness

    6. Violent civil unrest

    7. Homelessness

    8. Disease – because trash will not be collected and human waste can no longer be flushed, we could have a plague on our hands within weeks. Treatable medical conditions will turn deadly, people with controllable chronic conditions will die due to a lack of medication, and serious medical issues, like heart attacks, will cause even more deaths as hospitals run out of generator power and because doctors will no longer have access to the high-tech tools they have come to rely upon. A pandemic is highly likely during such a long-term disaster.

    When both the United States and Russian government engaged in nuclear tests during the 1960s, the experiments definitely did not go as planned.

    The Star Fish Prime test of 1962 involved a 1.4 megaton nuclear warhead being launched over the Pacific Ocean by the United States government. The EMP pulses generated by the testing of the nuclear warhead were significantly more powerful and far reaching than the learned scientists of that era had anticipated.

    In Hawaii, more than 1,000 miles away from the test sight, street lights went out. The test results the scientists had hoped to review and learn from were rendered useless because the EMP event was so powerful it exceeded the ability of their equipment to measure.

    At the same time as the Star Fish Prime test, Russia was engaging a nearly identical nuclear experiment of their own – Test 184. Although the exacts details about the type of nuclear warhead used and other particulars related to the test are still unknown outside of our Cold War foe, diesel generators were damaged and a a shielded and underground power line 180 miles away from the test area in Kazakhstan.

    Are We Prepared?

    Some analysts and elected officials prefer to bury their heads in the sand instead of facing reality and hardening our power grid from an EMP attack.If you think the government has a ready stockpile of necessary parts tucked away in Faraday cages “just in case” think again. We do not even make the parts needed to repair our electrical grid in the United States. If the EMP attack is global, as would be the case with an Earth-directed solar flare, getting the parts we need from an overseas manufacturer will not be an option.

    How Can I Protect My Stuff ?

    During an EMP, electric fields, both non-static and static, are obstructed because electricity is directed around the mesh, producing continuous voltage on all sides but not the space in the middle. Cars and microwaves are NOT Faraday cages. As a rule of thumb, if you can listen to the radio or call your cell phone while inside any of them, they won’t work.

    To ensure that your electronics survive an EMP spike, they have to be housed inside aFaraday cage shield, preferably several nested cages. What is a Faraday cage? It is a low-tech cage, box, or can made of metal and lined with cardboard that houses sensitive electronic equipment to harden it against an EMP or CME. The components inside absolutely cannot touch for the cage to function properly.

    Michael Faraday, a scientist from England, invented a cage that is capable of shielding its contents from an EMP by rerouting the charge around the surface of the metal, in 1836. The more dense the metal, the better the contents in inside will be protected – that fact is why most preppers use metal trash cans as Faraday cages.

    How well a Faraday cage would work under real world conditions remains unknown because they have only been tested in laboratory simulations. But, it still remains the best shot at saving your handheld 2-way radios, batteries, spare vehicle parts, etc.

    There Are many opinions on whether or not these cages will work so… better safe than sorry.The mesh layer of conductive material in Faraday bags creates this protective skin.

    If you’re worried about EMP obliterating your comms, invest in a Surplus PRC 77 radio and an EMP-resistant vehicle. Short range comms, that utilize VHF/UHF radios, can be up and running less than an hour after an EMP strike, if protected. Long range comms will take several hours to recover.

    How well your vehicle will fare against an EMP will depend largely upon its age. There is a lot of debate about how old is old enough, when it comes to the durability of car parts from an EMP survival perspective. Some folks say any vehicle built prior to the early 1970s does not possess components with electronic components sensitive enough to be impacted by an EMP. Still others staunchly maintain a vehicle older than the 1950s or maybe the 1960s, will not still work after an EMP.

    You can turn your garage into a Faraday cage in an attempt to harden your vehicle, ATV, and other electronic devices and survival gear. If you own a metal pole barn style garage, simply line the floor with sheet metal and then place several layers of thick cardboard or plywood on top of the metal to insulate the vehicles or equipment from the impact of the EMP.

    To protect your electronic devices, you need to defend against the E1 phase, a surge similar to radio waves that penetrates ground-level devices such as power cords, circuit boards and antennas. The E3 phase, which travels through power and phone lines, is also worrisome. E3 energy travels over longer conductors, flooding connected equipment and causing a destructive power overload.

    Formulate Plan B for operating your home and business without electronics or the Internet. How will you manage transactions? Inventory stock? Accept payments? To be safe, prepare yourself now to conduct all operations manually and to do cash only transactions.

    What About Day-To-Day Power Surges?

    For day-to-day protection, invest in quality surge protectors for your electronic devices, an affordable and reliable precaution. You’ll need one that’s UL-listed with a voltage of 330 volts or less, as well as a rapid response time. Buy a computer with an Ethernet slot, or get yourself a dedicated Ethernet surge protector. For optimal protection, add an uninterruptible power supply (UPS), an effective but more expensive option.

    The UPS should be a double conversion supply tested to meet UL standards. While 60-90% of today’s vehicles are designed to withstand electromagnetic pulses of up to 25 kV/m, it’s always best to be prepared for the worst case scenario. If you know your way around cars, consider buying back-up modules for your vehicle’s key electronics.

    What Is The Government Doing To Protect Us From An EMP?

    Not much, is the short answer.

    While nuclear weapons are destructive enough to level entire cities, the resultant EMP from one would likely be its most devastating effect. In 2001, in response to concern that crucial infrastructure and even the United States military would not hold up against an EMP strike, the EMP Commission was created by Congress. President Obama disbanded the committee and the potentially society-saving information that would come out of it, not long after taking office.

    In 2008, the Commission delivered a report on the possible effects that an EMP strike would have on national infrastructures, recommending ways that the US could prepare, protect, and restore these if this kind of attack were ever to take place. Dr. William Forstchen’s One Second After was heralded on the floor of Congress by those elected officials and commission members who saw the writing on the wall and were urging, if not outright begging, for something to be done to protect the lives of Americans, our economy, and sanctity of this nation, from an EMP attack.

    Their pleas largely fell upon deaf ears. Several bills were written to address the power grid’s frailties and to develop a full and actionable plan to prepare for an EMP attack – and to survive afterwards, but they never made it out of committee.

    Why do perhaps the most important pieces of legislation introduced during our lifetimes keep getting buried? Disbelief such a SHTF event is really going to happen for one – but over money, mostly.

    Hardening the power grid and taking other necessary steps to prepare American for either a man-made or natural EMP attack would cost billions of dollars. Why don’t our public servants just stop sending our hard-earned money to countries they readily and loudly proclaim their hate for us and curtail the tens of billions of dollars sent overseas for charitable reasons and spent on studies about that place shrimp on treadmills? That is a good question for which neither I, nor those politicians who continue to ignore this looming and very real SHTF thread, have no reasonable answer.

    Final Word

    An EMP attack is a strong possibility in today’s economically-strained, weaponized world. It is a swift, deadly, and silent force that relies on the deterioration of civil society into chaos and darkness. While it may appear to be a perfectly normal scientific phenomenon, its effects on humanity will be crippling. How prepared are you for an EMP strike?

  • US Farmers Choke On Trade War With China

    In April we told you about how some of the “unintended consequences” of Trump’s steel tariffs, such as an Illinois farmer who put the brakes on a $71,000 grain mill, but had to hold off on the purchase because the seller raised the price 5% to account for the rising price of steel, or Iowa grain mill producer Sukup Manufacturing, which had to hike their prices for grain storage bins. 

    The Wall Street Journal now reports that the US-China “trade spat” is now affecting US exporters of soybeans, pork and other commodities. 

    Since early April, when China announced tariffs on some U.S. agricultural goods and threatened to target others, Chinese importers have canceled purchases of corn and cut orders for pork while dramatically reducing new soybean purchases, according to U.S. Department of Agriculture data. Chinese importers’ new orders of sorghum, a grain used in animal feed, have dwindled while cancellations increased.

    The chill in agricultural trade is sending jitters through the U.S. Farm Belt, which for years has dispatched farmers on trade missions to cultivate the Chinese market. –WSJ

    “As the summer persists and if nothing’s been resolved, it will start showing up as a pretty big hole in U.S. exports,” warned Soren Schroder, CEO of Bunge Ltd., one of the world’s largest soybean processors and traders.

    Last Thursday, a ship bound for China carrying over 58,000 tons of American sorghum was diverted to South Korea after Beijing said it would levy a hefty deposit on U.S. shipments of the grain amid an anti-dumping probe.

    Importers now facing losses of millions of dollars on their cargoes are trying to resell the grain to buyers elsewhere but are being forced to offer steep discounts.

    Four cargoes have been resold to Saudi Arabia and Japan, and another is heading to Spain. If the ‘Peak Pegasus’ unloads in South Korea, it would be first of the Chinese cargoes to be resold in that country. –Reuters

    No date has been set in stone for the various tariffs China has threatened to impose, however senior US officials including Treasury Secretary Steven Mnuchin and US Trade Representative Robert Lighthizer are meeting with Chinese officials in Beijing this week for negotiations. That said, even if they reach an agreement, the uncertainty created by the threatened tariffs has already done quite a lot of damage in the commodities sector.

    China spent around $20 billion annually on US agricultural products in 2017 – and their growing apetite for pork and other meats requires huge quantities of feed grain, such as the aforementioned diverted sorghum. China-based importers are holding off on new soybean orders from the US, including their usual advance purchase of this fall’s crops, as nobody wants to take the risk that a shipment will be slapped with a giant tariff by the time it is delivered. As such, China is buying more beans from South American suppliers, according to Bunge’s Schroder.

    Chinese buyers ordered about 255,000 metric tons of U.S. soybeans during the week ended April 5, according to the USDA, but new sales over the rest of the month came to about 11,000 metric tons, a sharp decline. Meanwhile, purchasers canceled nearly 76,000 metric tons’ worth of orders over the month. –WSJ

    “If [the Chinese] market closes, it could be devastating for local communities across the Midwest,” said Senator Chuck Grassley (R-IA) in a statement. 

    Despite the fact that US soybeans are around $15 a ton cheaper than beans from Brazil, a 25% tariff would cost Chinese importers around $100 a ton according to St. Louis-based trader Ken Morrison. 

    Ed Breen, chief executive of crop-seed supplier DowDuPont Inc., said Thursday that if China steps back from U.S. soybean purchases, growing markets like Mexico, Indonesia, Vietnam and Turkey would fill the void. –WSJ

    Following China’s tariff on US pork products on April 2, the USDA reported the largest weekly drop in net pork sales to the country since October 2016, and sales have declined further since then.

    Given expanding pork supplies—boneless hams in cold storage hit a record 86 million pounds earlier this year—and another big slaughterhouse set to open later this year, the industry has been aiming to sell more to China, not less. –WSJ

    “With the trade negotiations, a lot of unknowns with our future demand is clearly not a positive to the pork market at this stage,” said Jason Roose, VP of U.S. Commodities Inc., a livestock and grain advisory firm based in Des Moines, Iowa.

    Given China’s growing need for agricultural imports, some believe that China won’t be able to avoid US crops for long. That said, the biggest danger in this trade war is US farmers and agricultural companies developing a reputation for unreliability – prompting other countries to maximize their own crop production, according to research firm AgResource Co’s President, Dan Basse. 

    “Our biggest concern is the message this sends to the world,” said Mr. Basse, adding that “Brazil still has an abundance of land to bring into production, and farm profits there would rise to the chagrin of the U.S. farmer.”

    Trump might be wise to note that the very US farmers suffering the unintended consequences of the trade spat with China are the very same folks from he promised not to neglect.

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