Florence Archives - The Automatic Earth

Typhoon Mangkhut killed at least 30 people in the Philippines as it obliterated homes and crops and caused massive flooding, and is now on course to plough into China’s southern coast. Presidential adviser Francis Tolentino said the heaviest casualty was recorded in the mountainous Cordillera region in northern Luzon, where heavy rains caused landslides that left 24 people dead and 13 more missing. Four others – including two children – were buried in a landslide in Nueva Ecija, another in Kalinga, and one person was killed by a falling tree in Ilocos Sur, Tolentino said.

The storm, which was the strongest the region has seen this year, was not as ferocious as feared, though due to the remote areas where the typhoon hit, the full death toll and extent of the destruction is still unknown. By Sunday morning, it was hurtling towards China’s heavily populated southern coast with winds of 177km/h (110mph). In Hong Kong, where the huge storm is expected to skirt just 100km (62 miles) south of the city, officials raised the storm alert to a T10, its highest level. Businesses have been boarded up and most flights cancelled.

Philippines (2018) – Typhoon Mangkhut – Seems like the world's ending
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.#Hurricane #hurricaneflorence #Florence #NorthCarolina #SouthCarolina #EastCoast #Virginia #NationalHurricaneCenter #landfall #TropicalStorm #Typhoon #TyphoonMangkhut #weather #hurricanes #MangKhut pic.twitter.com/MsGQPiiMrV

— Ruivismo (@blogruivismo) September 16, 2018

The water has nowhere to go.

• Florence Dumps ‘Epic’ Amounts Of Rain On Carolinas (BBC)

US east coast communities face “epic amounts of rainfall” from tropical storm Florence, which has been linked to at least 12 deaths. It has caused catastrophic flooding since arriving as a category one hurricane on Friday. Some towns have already seen 2ft (60cm) of rain in two days, with totals forecast to top 3.5ft (1m) in places. It is feared that more communities could become deluged as the storm crawls west at only 2mph (3km/h). “This system is unloading epic amounts of rainfall, in some places measured in feet and not inches,” North Carolina Governor Roy Cooper said on Saturday. He urged against residents attempting to return home, warning that “all roads in the state are at risk of floods”.

“There’s no snooze button on the national debt clock..”

• ‘We’re Using the Future for a Fiscal Dumping Ground’ (Barron’s)

There’s no snooze button on the national debt clock, though you wouldn’t know it by the way public alarm has quieted as the situation grows worse. October begins a new fiscal year for the U.S. government—and a faster ballooning of how much it owes. Barring a behavioral miracle in Congress, trillion dollar yearly budget shortfalls will return, perhaps as soon as the coming year. And unlike the ones brought by the financial crisis and Great Recession of 2007-09, these will start during a period of relative plenty, and won’t end. Debt held by the public, a conservative tally of what America owes, will swell from $15.7 trillion at the end of September, or 78% of GDP to $28.7 trillion in a decade, or 96% of GDP.

Those estimates, provided by the Congressional Budget Office, are based on reasonable assumptions about economic growth, inflation, employment, and interest rates, but they leave out some important things. They assume that the nation’s need for increased infrastructure investment, estimated by the American Society of Civil Engineers at $1.4 trillion through 2025, goes unmet. They don’t account for the possibility of another financial crisis, or war, or a rise in the frequency or severity of natural disasters, and they assume that some Trump tax cuts will expire in 2025.

There is no clear milestone that marks the moment a country loses control of its finances, but consider how the bar has already been lowered for what seems possible in Congress. Even debt scolds no longer talk seriously about America paying down what it owes, or holding the dollar amount steady. The new path of fiscal prudence involves containing debt at some manageable percentage of GDP, and the opportunity for that is slipping.

“If I have to blame anybody, I will blame Bernanke..”

• The Lehman Brothers Bankruptcy (ET)

Sept. 15 marks the 10th anniversary of the collapse of Lehman Brothers, which had unprecedented ramifications worldwide. Painful lessons have been learned, but the debate continues among economists about whether the crisis could have been handled better. Lehman was the fourth-largest U.S. investment bank before it filed for bankruptcy. With $639 billion in assets, it was the biggest bankruptcy in U.S. history. It was also the largest victim of the subprime mortgage crisis that swept through global financial markets. And its collapse intensified the market shock, which wiped out nearly $10 trillion from global equity markets in October 2008, the largest monthly decline on record. The policymakers who handled Lehman’s bankruptcy in 2008 argue they did all they could.

However, economist Steve Keen, author of “Can We Avoid Another Financial Crisis?”, believes policymakers had a great deal of responsibility for causing the crisis. Keen is a harsh critic of mainstream economists who ignored mounting private debt in their forecasts and policy recommendations. “They could have prevented the bubble burst in the first place,” he said. He thinks the former chairman of the Federal Reserve, Ben Bernanke, was one of those who failed to recognize the risk created by the private debt explosion. “All these regulators were collecting data on global private debt and not worrying about it because economic theory said it did not matter,” he said. “If I have to blame anybody, I will blame Bernanke,” he said, adding that Bernanke “was the main academic economist saying ‘Don’t worry about the level of private debt.’”

But when? It’ll take a long time still before it becomes an option, and by then Brexit will be much closer.

• Give Britain A New Referendum On Brexit – London Mayor (G.)

The mayor of London has issued a dramatic call for another referendum on EU membership, insisting that the people must be given the chance to reject a Brexit deal that will be bad for the economy, jobs and the NHS. Writing in the Observer, Sadiq Khan says that, with so little time left to negotiate, there are now only two possible outcomes: a bad deal for the UK or “no deal” at all, which will be even worse. “They are both incredibly risky and I don’t believe Theresa May has the mandate to gamble so flagrantly with the British economy and people’s livelihoods,” he writes. Khan says that backing a second referendum was never something he expected to have to do.

But so abject has been the government’s performance, and so great is the threat to living standards and jobs, he says, that he sees no alternative than to give people a chance to stay in the EU. “This means a public vote on any Brexit deal obtained by the government, or a vote on a ‘no-deal’ Brexit if one is not secured, alongside the option of staying in the EU,” he writes. “People didn’t vote to leave the EU to make themselves poorer, to watch their businesses suffer, to have NHS wards understaffed, to see the police preparing for civil unrest or for our national security to be put at risk if our cooperation with the EU in the fight against terrorism is weakened.” The intervention from one of Labour’s most powerful politicians will put yet more pressure on the party leader Jeremy Corbyn to throw his support behind another referendum at Labour’s annual conference, which opens in Liverpool next weekend.

Italy had signed -oil- deals with Gaddafi.

• Italy Faults France for Gaddafi’s Downfall and Migrant Crisis (Sp.)

In Rome, the responsibility for the influx of migrants is laid on France, which persuaded NATO countries to get rid of Gaddafi. As a result, Libya is now torn apart by rival factions and an ongoing conflict between its two governments. “It is clearly now undeniable that this country (Libya) finds itself in this situation because someone, in 2011, put their own interests ahead of those of the Libyan people and of Europe itself,” Italian Defense Minister Elisabetta Trenta wrote on Facebook. “France, from this point of view, is partly to blame,” she added. Italian parliamentary speaker Roberto Fico was even more explicit, pointing to “a serious problem that has come from France.”

Italy’s Deputy Prime Minister Matteo Salvini also chimed in, blaming former French President Nicolas Sarkozy for unleashing the war in Libya and the present government for adding fuel to the flames of the Libyan conflict. Italians are filled with nostalgia each time they recall the time when Rome and Tripoli signed an agreement to allow Italian companies to extract oil in Libya. The Gaddafi government was holding back the flow of migrants to Europe and the country’s GDP was the second biggest in Africa and the first among the Arabic-speaking states of the Maghreb. In Rome, the emphasis is that the decision to overthrow Gaddafi was made without taking into account the views of Italy.

Seven years on, the French look equally unenthusiastic about the so-called “Libyan Revolution,” with President Emmanuel Macron admitting that the intervention was a mistake. “I remember how some people decided to get rid of the Libyan leader without having any action plan for the future. We plunged Libya into a situation of lawlessness without having a chance to rectify the situation,” Macron said when speaking in the Tunisian parliament earlier this year.

Don’t stop talking.

• Trump ‘Likely’ To Announce New China Tariffs As Early As Monday (R.)

U.S. President Donald Trump is likely to announce new tariffs on about $200 billion on Chinese imports as early as Monday, a senior administration official told Reuters on Saturday. The tariff level will probably be about 10 percent, the Wall Street Journal reported, quoting people familiar with the matter. This is below the 25 percent the administration said it was considering for this possible round of tariffs. The upcoming tariffs will be on a list of items that included $200 billion worth of internet technology products and other electronics, printed circuit boards and consumer goods including Chinese seafood, furniture and lighting products, tires, chemicals, plastics, bicycles and car seats for babies.

It was unclear if the administration will exempt any of the products that were on the list, which was announced in July. On Friday, White House spokeswoman Lindsay Walters said Trump “has been clear that he and his administration will continue to take action to address China’s unfair trade practices. We encourage China to address the long-standing concerns raised by the Unites States.” Trump had already directed aides to proceed with tariffs, despite Treasury Secretary Steven Mnuchin’s attempts to restart trade talks with China.

Do you see it happening?

• Europe’s Meat And Dairy Production Must Halve By 2050 (G.)

Europe’s animal farming sector has exceeded safe bounds for greenhouse gas emissions, nutrient flows and biodiversity loss, and urgently needs to be scaled back, according to a major report. Pressure on livestock farmers is set to intensify this century as global population and income growth raises demand for meat-based products beyond the planet’s capacity to supply it. The paper’s co-author, Professor Allan Buckwell, endorses a Greenpeace call for halving meat and dairy production by 2050, and his report’s broadside is squarely aimed at the heart of the EU’s policy establishment.

Launching the report, the EU’s former environment commissioner Janez Potocnik said: “Unless policymakers face up to this now, livestock farmers will pay the price of their inactivity. ‘Protecting the status quo’ is providing a disservice to the sector.” The study calls for the European commission to urgently set up a formal inquiry mandated to propose measures – including taxes and subsidies – that “discourage livestock products harmful to health, climate or the environment”. Livestock has the world’s largest land footprint and is growing fast, with close to 80% of the planet’s agricultural land now used for grazing and animal feed production, even though meat delivers just 18% of our calories.

Debt Rattle September 15 2018

Sep 152018

September 15, 2018 Posted by Raúl Ilargi Meijer at 8:26 am Finance Tagged with: boom, bust, Dalai Lama, Florence, pension cuts, rates, Russia, Shiller, Tulsi Gabbard, Turkey, Yellen 6 Responses »

Leonard Misonne Waterloo Place 1899

• Central Banks Have Gone Rogue, Putting Us All at Risk (Ellen Brown)

• Shiller Sees ‘Bad Times In The Stock Market’ Ahead (CNBC)

• Yellen: Fed Should Commit To Future ‘Booms’ To Make Up For Major Busts (R.)

• Russia Central Bank Raises Key Rate To 7.5%, Extends Pause In FX Buying (R.)

• Turkey Raises Key Interest Rate To 24% In Bid To Curb Inflation (G.)

• Lamentation (Jim Kunstler)

• Days After 9/11 Tulsi Gabbard Slams Betrayal Of American People Over Syria (ZH)

• Acrimony As EU Denies False Report On Greek Pension Cuts Relief (K.)

• Dalai Lama Says ‘Europe Belongs To Europeans’ (AFP)

• Florence Plows Inland, Leaving Five Dead, States Flooded (R.)

Tons of 10-year Lehman stories. haven’t seen that many truly impressive ones.

• Central Banks Have Gone Rogue, Putting Us All at Risk (Ellen Brown)

The U.S. Federal Reserve, which bailed out General Motors in a rescue operation in 2009, was prohibited from lending to individual companies under the Dodd-Frank Act of 2010, and it is legally barred from owning equities. It parks its reserves instead in bonds and other government-backed securities. But other countries have different rules, and central banks are now buying individual stocks as investments, with a preference for big tech companies like Amazon, Apple, Facebook and Microsoft. Those are the stocks that dominate the market, and central banks are aggressively driving up their value. Markets, including the U.S. stock market, are thus literally being rigged by foreign central banks.

The result, as noted in a January 2017 article at Zero Hedge, is that central bankers, “who create fiat money out of thin air and for whom ‘acquisition cost’ is a meaningless term, are increasingly nationalizing the equity capital markets.” Or at least they would be nationalizing equities, if they were actually “national” central banks. But the Swiss National Bank, the biggest single player in this game, is 48 percent privately owned, and most central banks have declared their independence from their governments. They march to the drums not of government but of private industry.

Marking the 10th anniversary of the 2008 collapse, former Fed Chairman Ben Bernanke and former Treasury Secretaries Timothy Geithner and Henry Paulson wrote in a Sept. 7 New York Times op-ed that the Fed’s tools needed to be broadened to allow it to fight the next anticipated economic crisis, including allowing it to prop up the stock market by buying individual stocks. To investors, propping up the stock market may seem like a good thing, but what happens when the central banks decide to sell? The Fed’s massive $4 trillion economic support is now being taken away, and other central banks are expected to follow. Their U.S. and global holdings are so large that their withdrawal from the market could trigger another global recession. That means when and how the economy will collapse is now in the hands of central bankers.

We all do.

• Shiller Sees ‘Bad Times In The Stock Market’ Ahead (CNBC)

Nobel laureate Robert Shiller thinks investors ought to ignore the recent burst in corporate profits and focus on longer-term valuation, which he says carries foreboding news for the stock market. At a time when earnings are rising 25 percent a quarter, Shilller said that’s not indicative of what longer-term results in the market will be. History has shown that in previous times, particularly around World War I, the late 1920s approaching the time of the Depression, and in the high-inflation 1980s, profits could be strong but equity results not as much. In the present case, the recent surge in profits has been due to last year’s tax cuts, backed by President Donald Trump, that took the corporate rate from 35 percent to 21 percent.

“My own way of thinking is it looks like an overreaction,” Shiller said Friday at a conference in New York presented by the Wharton School. “We’re launching a trade war. Aren’t people thinking about that? Is that a good thing? I don’t know, but I’m thinking it’s likely to be bad times in the stock market.” Shiller cautioned that he is not predicting major calamity for the market but rather a much lower level of returns, in the 2.6 percent annual range, than investors have come to expect during the 9-year-old bull market. The longest rally in history has the S&P 500 up more than 335 percent since the March 2009 bottom. “It’s not like I’m predicting a crash,” he said. “This is a 10-year forward return. This is not going to be great, because we’re just too high at the present value.”

Really, these people think they saved the economy. By creating fake booms.

• Yellen: Fed Should Commit To Future ‘Booms’ To Make Up For Major Busts (R.)

The U.S. Federal Reserve should commit to letting economic booms run on enough to fully offset collapses like the 2007 to 2009 Great Recession, former Fed chair Janet Yellen said on Friday, urging the central bank to make “lower-for-longer” its official motto for interest rates following serious downturns. Yellen’s approach, which comes in the wake of complaints by the Trump administration about Fed interest rate hikes, could imply a looser monetary policy stance amid Fed officials’ concerns about tight labor markets and greater financial stability risks after a decade of low rates. Those concerns should not be shunted aside, Yellen said, in her most extensive remarks about monetary policy since leaving the Fed early in the year.

Elaborating on how the central bank should think about what to do if rates have to be cut to zero again in the future and can’t go any lower, she said the Fed should promise now that it will keep rates low enough to let a hot economy make up for lost time. “By keeping interest rates unusually low after the zero lower bound no longer binds, the lower-for-longer approach promises, in effect, to allow the economy to boom,” Yellen said in remarks delivered at a Brookings Institution conference. “The (Federal Open Market Committee) needs to make a credible statement endorsing such an approach, ideally before the next downturn.”

The trade wars affect Russia only slightly.

• Russia Central Bank Raises Key Rate To 7.5%, Extends Pause In FX Buying (R.)

The Russian central bank raised its key interest rate to 7.50 percent on Friday and said it would not make any foreign currency purchases until the end of the year, citing the risk of higher inflation and rouble volatility. It was the first time the central bank had raised the key rate since late 2014 when it had to step in to help stabilise the tanking rouble. The rouble firmed after the decision, trading at 67.88 versus the dollar compared with 68.41 shortly before. “The increase of the key rate will help maintain real interest rates on deposits in positive territory, which will support the attractiveness of savings and balanced growth in consumption,” the central bank said in a statement.

Analysts polled by Reuters had mostly expected the central bank to hold the rate at 7.25 percent, as it had done at three previous board meetings, but had not ruled out the possibility of a rate hike either. The bank’s decision to extend a pause in daily FX buying until the end of 2018 from the end of September will help curtail exchange rate volatility and its influence on inflation over the next few quarters, the central bank said. Explaining its thinking, the central bank said “changes in external conditions observed since the previous meeting of the Board of Directors have significantly increased pro-inflationary risks.”

7.5% in Russia, 24% in Turkey. Why? Because Turks borrowed so much in dollars.

• Turkey Raises Key Interest Rate To 24% In Bid To Curb Inflation (G.)

Turkey‘s central bank has raised its key interest rate to 24% in a dramatic bid to control rocketing inflation and prevent a currency crisis. Ignoring calls for restraint from President Erdogan, the bank raised its main short-term rate from 17.5% following weeks of pressure from international investors. Financial markets have grown increasingly concerned that Turkey is in danger of adding its name to the list of countries seeking a rescue loan from the IMF. Argentina agreed a loan earlier in the summer with the IMF and only last month called on the Washington-based lender to release the funds earlier to to ease concerns that the country would not be able to meet its debt obligations over the next year.

South Africa, Indonesia and Mexico are also among a group of emerging market economies that have seen their currencies tumble as investors desert countries that have grown quickly using large amounts of borrowed funds. The Turkish lira began to recover shortly after the rate hike, strengthening by 3% to 6.16 against the dollar. Inflation also soared this month to a 15-year high of almost 18%. The currency has plunged in recent months and even after Thursday’s rise was down almost 39% against the dollar this year.

Third world America.

• Lamentation (Jim Kunstler)

The lamentation for the northern part of “flyover” America is an old story now. Nobody is surprised anymore by the desolation of de-industrialized places like Youngstown, Ohio, or Gary, Indiana, where American wealth was once minted the hard way by men toiling around blast furnaces. But the southeast states enjoyed a strange interlude of artificial dynamism since the 1950s, which is about three generations, and there is little cultural memory for what the region was like before: an agricultural backwater with few cities of consequence and widespread Third Worldish poverty, barefoot children with hookworm, and scrawny field laborers in ragged straw hats leaning on their hoes in the stifling heat.

The demographic shifts of recent decades turned a lot of it into an endless theme park of All-You-Can-Eat buffets, drive-in beer emporia, hamburger palaces, gated retirement subdivisions, evangelical churches built like giant muffler shops, vast wastelands of free parking, and all the other trappings of the greatest misallocation of resources in the history of the world. Like many of history’s prankish proceedings, it seemed like a good idea at the time. As survivors slosh around in the plastic debris in the weeks ahead, and the news media spins out its heartwarming vignettes of rescue and heroism, will there be any awareness of what has actually happened: the very sudden end of a whole regional economy that was a tragic blunder from the get-go?

It is probably hard to imagine Dixieland struggling into whatever its next economy might be. In some places, it’s not even possible to return to a prior economy based on agriculture. A lot of the landscape was farmed so ruinously for two hundred years that the soil has turned into a kind of natural cement, called hardpan or caliche. The climate prospects for the region are not favorable either, not to mention the certain cessation of universal air-conditioning and “happy motoring” that made the unwise mega-developments of recent decades possible.

I remember her meeting with Trump. She must feel deceived. Just not clear by whom.

• Days After 9/11 Tulsi Gabbard Slams Betrayal Of American People (ZH)

In a rare and unprecedented speech delivered on the House floor just two days after the nation memorialized 9/11, Democratic Hawaiian Congresswoman Tulsi Gabbard on Thursday slammed Washington’s longtime support to anti-Assad jihadists in Syria, while also sounding the alarm over the current build-up of tensions between the US and Russia over the Syria crisis. She called on Congress to condemn what she called the Trump Administration’s protection of al-Qaeda in Idlib and slammed Washington’s policies in Syria as “a betrayal of the American people” — especially the victims and families that perished on 9/11.

Considering that Congresswoman Gabbard herself is an Iraq war veteran and current Army reserve officer who served in the aftermath of 9/11, it’s all the more power and rare that a sitting Congress member would make such forceful comments exposing the hypocrisy and contradictions of US policy. She called out President Trump and Vice President Mike Pence by name on the House floor in her speech: “Two days ago, President Trump and Vice President Pence delivered solemn speeches about the attacks on 9/11, talking about how much they care about the victims of al-Qaeda’s attack on our country. But, they are now standing up to protect the 20,000 to 40,000 al-Qaeda and other jihadist forces in Syria, and threatening Russia, Syria, and Iran, with military force if they dare attack these terrorists.”

[..] Trump and Gabbard had even once met to discuss Syria policy at a private meeting at Trump Tower in November of 2016 just ahead of then president-elect Trump being sworn into office. At the time the two appeared to be in complete agreement over Syria policy, after which Gabbard said of the meeting, “I felt it important to take the opportunity to meet with the President-elect now before the drumbeats of war that neocons have been beating drag us into an escalation of the war to overthrow the Syrian government—a war which has already cost hundreds of thousands of lives and forced millions of refugees to flee their homes in search of safety for themselves and their families.”

Pacta sunt servanda.

• Acrimony As EU Denies False Report On Greek Pension Cuts Relief (K.)

The European Commission on Friday denied a report in the state-run Athens-Macedonian News Agency (ANA-MPA) that claimed Greece’s lenders had agreed to the non-implementation of pension cuts slated for January as they believe the country’s social security system has become viable. The agency, whose report was initially backed by government spokesman Dimitris Tzanakopoulos, also claimed that the institutions had informed opposition parties about their decision. But a government source told Kathimerini that the report was not true.

The EC was quick to refute the report with a statement urging Greece to deliver on the promises it has made to its international lenders under the bailout program. “Our position is crystal-clear: Pacta sunt servanda. This is the only position you need to look at,” Commission spokesman Alexander Winterstein told a news briefing, using a Latin proverb which means “agreements must be kept.” For their part, the institutions said they made the visit to Athens – the first since Greece’s exit from the bailout program in August – not to engage in negotiations but to monitor whether the government is sticking to agreed reforms.

Not a popular thing to say. But is it wrong? What he means is stop the wars and invasions first.

• Dalai Lama Says ‘Europe Belongs To Europeans’ (AFP)

The Tibetan spiritual leader, the Dalai Lama, said Wednesday that “Europe belongs to the Europeans” and that refugees should return to their native countries to rebuild them. Speaking at a conference in Sweden’s third-largest city of Malmo, home to a large immigrant population, the Dalai Lama – who won the Nobel Peace Prize in 1989 – said Europe was “morally responsible” for helping “a refugee really facing danger against their life”. “Receive them, help them, educate them… but ultimately they should develop their own country,” said the 83-year-old Tibetan who fled the capital Lhasa in fear of his life after China poured troops into the region to crush an uprising. “I think Europe belongs to the Europeans,” he said, adding they should make clear to refugees that “they ultimately should rebuild their own country”. .

Where’s all the water going to go?

• Florence Plows Inland, Leaving Five Dead, States Flooded (R.)

Florence had been a Category 3 hurricane on the five-step Saffir-Simpson scale with 120-mph winds as of Thursday, but dropped to a Category 1 hurricane before coming ashore near Wrightsville Beach close to Wilmington. The National Hurricane Center downgraded it to a tropical storm on Friday afternoon, but warned it would dump as much as 30 to 40 inches of rain on the southeastern coast of North Carolina and into the northeastern coast of South Carolina in spots. “This rainfall will produce catastrophic flash flooding and prolonged significant river flooding,” the hurricane center said. Atlantic Beach on North Carolina’s Outer Banks islands had already received 30 inches (76 cm) of rain, the U.S. Geological Survey said.

By Friday night the center of the storm had moved to eastern South Carolina, about 15 miles northeast of Myrtle Beach, with maximum sustained winds of 70 mph. North Carolina utilities have estimated that as many as 2.5 million state residents could be left without power, the state’s Department of Public Safety said. More than 22,600 people were housed in 150 shelters statewide, including schools, churches and Wake Forest University’s basketball arena. Officials in New Bern, which dates to the early 18th century, said over 100 people were rescued from floods and the downtown was under water by Friday afternoon. Calls for help multiplied as the wind picked up and the tide rolled in.

“These are folks who decided to stay and ride out the storm for whatever reason, despite having a mandatory evacuation,” city public information officer Colleen Roberts said. “These are folks who are maybe in one-story buildings and they’re seeing the floodwaters rise.”

Debt Rattle September 14 2018

Sep 142018

September 14, 2018 Posted by Raúl Ilargi Meijer at 8:28 am Finance Tagged with: Bailouts, Brexit, China, extinction, Florence, Lehman, mass surveillance, Salvini, underwater 1 Response »

Claude Monet The sheltered path 1888

• The Bailouts for the Rich Are Why America Is So Screwed Right Now (Stoller)

• Ten Years After the Crash, We’ve Learned Nothing (Taibbi)

• Millions Of Americans Trapped In Underwater Homes 10 Years After Crisis (R.)

• No-Deal Brexit Could Lead To Financial Crisis As Bad As 2008 – Carney (Ind.)

• Europe’s Top Rights Court Rules Against Britain Over Mass Surveillance (AFP)

• S&P Sees Major Opportunity In China’s $11 Trillion Bond Market (CNBC)

• China Says World Trade System Not Perfect, Needs Reform (R.)

• ‘Little Mussolinis’: EU Chief Angers Italy With Comment On Far Right (R.)

• Third Of Earth’s Surface Must Be Protected To Prevent Mass Extinction (Ind.)

• Hurricane Florence Deluges Carolinas Ahead Of Landfall (R.)

And there are different ways…

• The Bailouts for the Rich Are Why America Is So Screwed Right Now (Stoller)

In 1933, when FDR took power, global banking was essentially non-functional. Bankers had committed widespread fraud on top of a rickety and poorly structured financial system. Herbert Hoover, who organized an initial bailout by establishing what was known as the Reconstruction Finance Corporation, was widely mocked for secretly sending money to Republican bankers rather than ordinary people. The new administration realized that trust in the system was essential. One of the first things Roosevelt did, even before he took office, was to embarrass powerful financiers. He did this by encouraging the Senate Banking Committee to continue its probe, under investigator Ferdinand Pecora, of the most powerful institutions on Wall Street, which were National City (now Citibank) and JP Morgan.

Pecora exposed these institutions as nests of corruption. The Senate Banking Committee made public Morgan’s “preferred list,” which was the group of powerful and famous people who essentially got bribes from Morgan. It included the most important men in the country, like former Republican President Calvin Coolidge, a Supreme Court Justice, important CEOs and military leaders, and important Democrats, too. Roosevelt also ordered his attorney general “vigorously to prosecute any violations of the law” that emerged from the investigations. New Dealers felt that “if the people become convinced that the big violators are to be punished it will be helpful in restoring confidence.” The DOJ indicted National City’s Charles Mitchell for tax evasion.

This was part of a series of aggressive attacks on the old order of corrupt political and economic elites. The administration pursued these cases, often losing the criminal complaints but continuing with civil charges. This bought the Democrats the trust of the public. When Roosevelt engaged in his own broad series of bank bailouts, the people rewarded his party with overwhelming gains in the midterm elections of 1934 and a resounding re-election in 1936. Along with an assertive populist Congress, the new administration used the bailout money in the RFC to implement mass foreclosure-mitigation programs, create deposit insurance, and put millions of people to work. He sought to save not the bankers but the savings of the people themselves.

Neil Barofsky on Twitter: “No need to write a retrospective on the bailouts, @mtaibbi has got it all covered here.”

Taibbi’s reply: “Wow. Can I unpublish so you will write one? (Neil wrote the definitive book on the subject)”.

(Barofsky was the SIGTARP, the Special United States Treasury Department Inspector General overseeing the Troubled Assets Relief Program from late 2008 till early 2011)

• Ten Years After the Crash, We’ve Learned Nothing (Taibbi)

Too Big To Fail shows Fuld on a rant: “People act like we’re crack dealers,” Fuld (James Woods) gripes. “Nobody put a gun to anybody’s head and said, ‘Hey, nimrod, buy a house you can’t afford. And you know what? While you’re at it, put a line of credit on that baby and buy yourself a boat.” This argument is the Wall Street equivalent of Reagan’s famous Cadillac-driving “welfare queen” spiel, which today is universally recognized as asinine race rhetoric. Were there masses of people pre-2008 buying houses they couldn’t afford? Hell yes. Were some of them speculators or “flippers” who were trying to game the bubble for profit? Sure. Most weren’t like that – most were ordinary working people, or, worse, elderly folks encouraged to refinance and use their houses as ATMs – but there were some flippers in there, sure.

People pointing the finger at homeowners are asking the wrong questions. The right question is, why didn’t the Fulds of the world care if those “nimrods” couldn’t afford their loans? The answer is, the game had nothing to do with whether or not the homeowner could pay. The homeowner was not the real mark. The real suckers were institutional customers like pensions, hedge funds and insurance companies, who invested in these mortgages. If you had a retirement fund and woke up one day in 2009 to see you’d lost 30 percent of your life savings, you were the mark. Ordinary Americans had their remaining cash in houses and retirement plans, and the subprime scheme was designed to suck the value out of both places, into the coffers of a few giant banks.

“As of June 30, nearly one in 10 American homes with mortgages were “seriously” underwater..”

• Millions Of Americans Trapped In Underwater Homes 10 Years After Crisis (R.)

School bus driver Michael Payne was renting an apartment on the 30th floor of a New York City high-rise, where the landlord’s idea of fixing broken windows was to cover them with boards. So when Payne and his wife Gail saw ads in the tabloids for brand-new houses in the Pennsylvania mountains for under $200,000, they saw an escape. The middle-aged couple took out a mortgage on a $168,000, four-bedroom home in a gated community with swimming pools, tennis courts and a clubhouse. “It was going for the American Dream,” Payne, now 61, said recently as he sat in his living room. “We felt rich.” Today the powder-blue split-level is worth less than half of what they paid for it 12 years ago at the peak of the nation’s housing bubble.

Located about 80 miles northwest of New York City in Monroe County, Pennsylvania, their home resides in one of the sickest real estate markets in the United States, according to a Reuters analysis of data provided by a leading realty tracking firm. More than one-quarter of homeowners in Monroe County are deeply “underwater,” meaning they still owe more to their lenders than their houses are worth. The world has moved on from the global financial crisis. Hard-hit areas such as Las Vegas and the Rust Belt cities of Pittsburgh and Cleveland have seen their fortunes improve. But the Paynes and about 5.1 million other U.S. homeowners are still living with the fallout from the real estate bust that triggered the epic downturn.

As of June 30, nearly one in 10 American homes with mortgages were “seriously” underwater, according to Irvine, California-based ATTOM Data Solutions, meaning that their market values were at least 25 percent lower than the balance remaining on their mortgages.

And he just signed up to oversee it till 2020.

• No-Deal Brexit Could Lead To Financial Crisis As Bad As 2008 – Carney (Ind.)

A no-deal Brexit could lead to a financial crisis as bad as the crash in 2008, the governor of the Bank of England has warned. Mark Carney told Theresa May and senior ministers that not getting a deal with the European Union would lead to a number of negative economic consequences. It is also understood that Mr Carney warned house prices could fall by up to 35 per cent over three years in a worst case scenario, an event that could cause the value of sterling to plummet and force the bank to push up interest rates. His bleak prognosis came as France said it could halt flights and Eurostar trains from the UK if there was no agreement when Britain leaves the EU in March 2019.

The Bank of England declined to comment on Mr Carney’s briefing to ministers. Following the three-and-a-half hour meeting of the cabinet, a Downing Street spokesman said ministers remained confident of securing a Brexit agreement, but had agreed to “ramp up” their no-deal planning.

So what changes now?

• Europe’s Top Rights Court Rules Against Britain Over Mass Surveillance (AFP)

Europe’s top rights court ruled Thursday that Britain’s programme of mass surveillance, revealed by whistleblower Edward Snowden as part of his sensational leaks on US spying, violated people’s right to privacy. Ruling in the case of Big Brother Watch and Others versus the United Kingdom, the European Court of Human Rights in Strasbourg, France, said the interception of journalistic material also violated the right to freedom of information. The case was brought by a group of journalists and rights activists who believe that their data may have been targeted. The court ruled that the existence of the surveillance programme “did not in and of itself violate the convention” but noted “that such a regime had to respect criteria set down in its case-law”.

They concluded that the mass trawling for information by Britain’s GCHQ spy agency violated Article 8 of the European Convention on Human Rights regarding the right to privacy because there was “insufficient oversight” of the programme. The court found the oversight to be doubly deficient, in the way in which the GCHQ selected internet providers for intercepting data and then filtered the messages, and the way in which intelligence agents selected which data to examine. It determined that the regime covering how the spy agency obtained data from internet and phone companies was “not in accordance with the law”.

China needs money, badly. Or it wouldn’t open up like this.

• S&P Sees Major Opportunity In China’s $11 Trillion Bond Market (CNBC)

Financial services and ratings giant S&P Global is honing in on China’s $11 trillion bond market, a move that may spell good news for international investors in search of more reliable ratings for bonds. Speaking to CNBC on Friday, S&P Global Chief Financial Officer Ewout Steenbergen explained that it’s a good time to enter China as Asia’s largest economy has lifted foreign ownership restrictions for credit ratings agencies. Elaborating on the company’s plan to offer ratings services for the bond market there, Steenbergen said that S&P Global intends to start a new entity for its mainland business.

“We are expanding our market intelligence business in China, very specific local content, for example for Chinese private company data … But the most attractive opportunity we have is in the ratings business,” he said on CNBC’s “Squawk Box.” “It is the third-largest domestic bond market in the world, we think it will overtake Japan soon to become the second-largest domestic bond market,” added Steenbergen, who is also an executive vice president at S&P Global. [..] Steenbergen said he hopes that S&P Global’s move to enter that market can create more confidence. “Today, Chinese domestic bonds, 2 percent are bought by international investors, 98 percent only by Chinese investors. And I think (how) we can help with the market is to create more maturity, more confidence.

Another way to protest tariffs.

• China Says World Trade System Not Perfect, Needs Reform (R.)

The current world trade system is not perfect and China supports reforms to it, including to the World Trade Organization, to make it fairer and more effective, Beijing’s top diplomat said. China is locked in a bitter trade war with the United States and has vowed repeatedly to uphold the multilateral trading system and free trade, with the WTO at its center. But speaking late on Thursday to reporters after meeting French Foreign Minister Jean-Yves Le Drian, Chinese State Councillor Wang Yi said some reforms could be good. While certain doubts have been raised about the current international trading system, China has always supported the protection of free trade and believes that multilateralism with the WTO at its core should be strengthened, Wang added.

[..] China will not buckle to U.S. demands in any trade negotiations, the major state-run China Daily newspaper said in an editorial on Friday, after Chinese officials welcomed an invitation from Washington for a new round of talks. The official China Daily said that while China was “serious” about resolving the stand-off through talks, it would not be rolled over, despite concerns over a slowing economy and a falling stock market at home. “The Trump administration should not be mistaken that China will surrender to the U.S. demands. It has enough fuel to drive its economy even if a trade war is prolonged,” the newspaper said in an editorial.

Brussels still feels superior.

• ‘Little Mussolinis’: EU Chief Angers Italy With Comment On Far Right (R.)

The EU’s top economic official has voiced fears that “little Mussolinis” might be emerging in Europe, drawing a furious response from Italy’s far-right interior minister who accused him of insulting his country and Italians. Pierre Moscovici, a Frenchman who is the European Union’s economics affairs commissioner, said the current political situation, with populist, far-right forces on the rise in many nations, resembled the 1930s when Germany’s Adolf Hitler and Italian fascist chief Benito Mussolini were in power. “Fortunately there is no sound of jackboots, there is no Hitler, (but maybe there are) small Mussolinis. That remains to be seen,” he told reporters in Paris, speaking in a jocular fashion.

Moscovici, a former French finance minister, mentioned no names, but Matteo Salvini, who is a deputy prime minister and heads Italy’s anti-immigrant League, took it personally. “He should wash his mouth out before insulting Italy, the Italians and their legitimate government,” Salvini said in a statement released by his office in Rome. Salvini took advantage of the spat to set out once again his grievances with France, which he accuses of not doing enough to help deal with migrants from Africa and of having plunged Libya into chaos by helping to oust former strongman Muammar Gaddafi. “EU commissioner Moscovici, instead of censuring his France that rejects immigrants … has bombed Libya and has broken European (budget) parameters, attacks Italy and talks about ‘many little Mussolini’ around Europe,” Salvini said.

Yeah. Not going to happen.

• Third Of Earth’s Surface Must Be Protected To Prevent Mass Extinction (Ind.)

Two leading scientists have issued a call for massive swathes of the planet’s land and sea to be protected from human interference in order to avert mass extinction. Current levels of protection “do not even come close to required levels”, they said, urging world leaders to come to a new arrangement by which at least 30 per cent of the planet’s surface is formally protected by 2030. Chief scientist of the National Geographic Society Jonathan Baillie and Chinese Academy of Sciences biologist Ya-Ping Zhang made their views clear in an editorial published in the journal Science.

They said the new target was the absolute minimum that ought to be conserved, and ideally this figure should rise to 50 per cent by the middle of the century. “This will be extremely challenging, but it is possible,” they said. “Anything less will likely result in a major extinction crisis and jeopardise the health and wellbeing of future generations.” Most current scientific estimates have the amount of space needed to safeguard the world’s animals and plants at between 25 and 75 per cent of land and oceans.

Nervous weekend ahead. In the Philippines too.

• Hurricane Florence Deluges Carolinas Ahead Of Landfall (R.)

Heavy rain, wind gusts and rising floodwaters from Hurricane Florence swamped the Carolinas early on Friday as the massive storm crawled toward the coast, threatening millions of people in its path with record rainfall and punishing surf. Florence was downgraded to a Category 1 storm on the five-step Saffir-Simpson scale on Thursday evening and was moving west at only 6 mph (9 km/h). The hurricane’s sheer size means it could batter the U.S. East Coast with hurricane-force winds for nearly a full day, according to weather forecasters. Despite its unpredictable path, it was forecast to make landfall near Cape Fear, North Carolina, at midday on Friday.

Debt Rattle September 13 2018

Sep 132018

September 13, 2018 Posted by Raúl Ilargi Meijer at 8:45 am Finance Tagged with: Brexit, crisis, Florence, Google, Hungary, Juncker, Kerry, Logan Act, Mangkhut, Minsky, plastics, Syria 4 Responses »

Henri Matisse Landscape with a bench 1918

• This Will Be The Mother Of All Minsky Moments (Mauldin)

• Leaderless World Is Sleepwalking Into A Financial Crisis – Gordon Brown (G.)

• UK PM May Calls Special Meeting To Discuss ‘No-Deal’ Brexit (CNBC)

• EU Can ‘Certainly Not’ Accept Theresa May’s Single Market Plan – Juncker (Ind.)

• Juncker Calls On EU To Seize Chance To Become Major Sovereign Power (G.)

• Poland Says It Will Block Any EU Sanctions Against Hungary (R.)

• Leaked Video Shows Distraught Google Execs Grappling With Hillary’s Loss (ZH)

• John Kerry Accused Of Violating Logan Act In Secret Iran Talks (ZH)

• US Destroyer Arrives In Mediterranean As Syria Tensions Rise (RT)

• No NGO Rescue Boats Currently In Central Mediterranean (G.)

Two More Potential ‘Garbage Patch’ Zones In World’s Oceans Identified (Ind.)

• Florence To Slow Down, Hammer Carolinas and Appalachia for Days (Weather.com)

The mother of all debt loads.

• This Will Be The Mother Of All Minsky Moments (Mauldin)

Dr. Hyman Minsky points out that stability leads to instability. The more comfortable we get with a given condition or trend, the longer it will persist. And then when the trend fails, the more dramatic the correction. Long-term stability produces unstable financial arrangements. If we believe that tomorrow will be the same as last week, we are more willing to add debt or postpone savings in favor of current consumption. Thus, says Minsky, the longer the period of stability, the higher the potential risk for even greater instability when market participants must change their behavior.

[..] I think the mother of all Minsky moments is building. It will not be an instant sandpile collapse, but instead take years because we have $500 trillion of debt to work through. Remember, that debt just can’t be pooped away. It is both money somebody owes and an asset on somebody else’s balance sheet. We can’t just take that away without huge consequences to culture and society.

All these people responsible for the last crisis are now advising on what to do with the next one.

• Leaderless World Is Sleepwalking Into A Financial Crisis – Gordon Brown (G.)

“It is very difficult to say what will trigger it [the next crisis] but we are at the latter end of the economic cycle where people take greater risks. There are problems in emerging markets.” Brown said one area of concern should be heavy commercial and industrial lending by lightly or unregulated shadow banks at a time when US interest rates are rising. “It could arise in Asia because of the amount of lending through the shadow banking system.” He added: “In an interconnected world there is an escalation of risks. We have had a decade of stagnation and we are now about to have a decade of vulnerability.”

Recalling the freezing up of the financial markets a decade ago, Brown said governments had sought to compensate for the lack of trust between banks by cooperating more closely. “In the next crisis a breakdown of trust in the financial sector would be mirrored by breakdown in trust between governments. There wouldn’t be the same willingness to cooperate but rather a tendency to blame each other for what’s gone wrong.

Waking up at last?

• UK PM May Calls Special Meeting To Discuss ‘No-Deal’ Brexit (CNBC)

The U.K. government is set to meet Thursday morning for three-hours to discuss the eventuality of a “no-deal” Brexit. The meeting takes place at a time when the government is also releasing more than 20 documents, outlining some more preparations in case the U.K. leaves the European Union in March 2019 without a deal. This is not the first set of papers outlining what will happen in case the U.K. and the EU do not reach a deal. In late August, the U.K. government said that businesses should prepare for higher barriers to trade, more red tape and potentially higher costs too, if Brexit talks collapse.

All these steps are part of a wider attempt to step up works for the worst-case scenario. The EU has also strengthened its preparations in case the U.K. leaves the bloc abruptly. The U.K.’s Brexit chief, Dominic Raab, warned on Wednesday that the U.K. will not pay the so-called divorce bill, if there is no final deal over Brexit. Raab wrote in the Daily Telegraph that the £39 billion ($50.82 billion) the U.K. owes to the EU, due to previous policy agreements, will not be repaid if there is no deal.

We know.

• EU Can ‘Certainly Not’ Accept Theresa May’s Single Market Plan – Juncker (Ind.)

Jean-Claude Juncker has given his clearest signal yet that the EU will not accept Theresa May’s plan to keep Britain in the single market for goods after Brexit. In his annual state of the union address in Strasbourg, the European Commission president said parts of the single market could “certainly not” be jettisoned for countries outside the bloc. But he said the Chequers proposals could be a “starting point” for the future relationship and that Britain would “never be an ordinary” country for the EU. “We respect the British decision to leave our union, even though we continue to regret it deeply,” he told MEPs. “But we also ask the British government to understand that someone who leaves the union cannot be in the same privileged position as a member state.

Bigger is better?!

• Juncker Calls On EU To Seize Chance To Become Major Sovereign Power (G.)

In his state of the union speech, titled The Hour of European Sovereignty, the European commission president appealed to MEPs and heads of government to give the EU the powers and characteristics traditionally restricted to states. Explaining his expansive vision, Juncker said the EU should aim to surpass the dominance of the dollar in the world economy and challenge China in its attempts to become the ascendant influence in Africa. The EU should be “a global player” as well as a “global payer”, Juncker said, with foreign policy decisions made on the basis of a qualified majority vote in which the will of 55% of member states would win the day.

Through trade deals, the EU’s standards and labour conditions were being exported across the world, he said, and it was time for the continent to further use its “clout” to mould the future. “The geopolitical situation makes this Europe’s hour: the time for European sovereignty has come,” Juncker told the European parliament in Strasbourg. “It is time Europe took its destiny into its own hands. It is time Europe developed what I coined Weltpolitikfähigkeit – the capacity to play a role, as a union, in shaping global affairs. Europe has to become a more sovereign actor in international relations.”

A crumbling fortress.

• Poland Says It Will Block Any EU Sanctions Against Hungary (R.)

Poland, the biggest former communist country in the European Union, said it will oppose any sanctions imposed by the bloc on fellow member Hungary, accused of floating EU rules on democracy. “Every country has its sovereign right to make internal reforms it deems appropriate,” Poland’s foreign ministry said in a statement late on Wednesday. “Actions aimed against member states serve only deepening divides in the EU, increasing citizens’ current lack of confidence to European institutions.” The European Parliament voted on Wednesday to sanction Hungary for neglecting norms on democracy, civil rights and corruption in a first bid to launch the punitive process of the EU treaty’s Article 7.

AI to save their day?

• Leaked Video Shows Distraught Google Execs Grappling With Hillary’s Loss (ZH)

Days after Google was exposed trying to help Hillary Clinton win the 2016 election, a leaked “internal only” video published by Breitbart Senior Tech correspondent Allum Bokhari reveals a panel of Google executives who are absolutely beside themselves following Hillary Clinton’s historic loss. The video is a full recording of Google’s first all-hands meeting following the 2016 election (these weekly meetings are known inside the company as “TGIF” or “Thank God It’s Friday” meetings). Sent to Breitbart News by an anonymous source, it features co-founders Larry Page and Sergey Brin, VPs Kent Walker and Eileen Naughton, CFO Ruth Porat, and CEO Sundar Pichai. -Breitbart

In the video, Brin can be heard comparing Trump supporters to fascists and extremists – arguing that like other extremists, Trump voters suffered from “boredom” which has, he claims, historically led to fascism and communism. He then asks his company what they can do to ensure a “better quality of governance and decision-making.” And according to Kent Walker, VP for Global Affairs, those who support populist causes like the MAGA movement are motivated by “fear, xenophobia, hatred and a desire for answers that may or may not be there.” He later says that Google needs to fight to ensure that populist movements around the world are merely a “blip” and a “hiccup” in the arc of history that “bends towards progress.”

A dark-grey area at best.

• John Kerry Accused Of Violating Logan Act In Secret Iran Talks (ZH)

Though he previously denied it when allegations first surfaced last Spring, former Secretary of State John Kerry has now disclosed he’s personally had semi-frequent face to face contact with top Iranian officials to discuss US-Iran relations since Trump entered office. Kerry confirmed and explained in detail his recent meetings with Iranian Former Minister Javad Zarif in an interview with radio host Hugh Hewitt to promote his new memoir, Every Day Is Extra.

During the interview Kerry disclosed that he met with Zarif “three or four times” and discussed political issues and challenges between the United States and Iran in what could constitute a significant and clear violation of the Logan Act. Though it’s almost never been enforced, the 1799 Logan Act states that unauthorized diplomacy with foreign powers by private American citizens is a crime. Notably, two Trump-connected individuals that prominent Liberals and editorials demanded be prosecuted under the Logan Act include former national security advisor Michael Flynn and Trump senior adviser and son-in-law Jared Kushner.

When asked point blank during the radio show about his rumored meetings with top Iran officials, Kerry admitted, “I think I’ve seen him three or four times,” but attempted to claim he was not trying to “coach” Iran on how to navigate President Trump’s pullout of the Iran nuclear deal. Kerry is of course now a private citizen out of government but holds significant clout and influence with the Iran FM as the two hammered out the details of the JCPOA brokered under President Obama in the first place.

I wouldn’t be too sure Russia will back down again.

• US Destroyer Arrives In Mediterranean As Syria Tensions Rise (RT)

With the arrival of another guided missile destroyer to the Mediterranean, the US may have 200 ‘Tomahawks’ ready for a strike on Syria, as Russia warns that jihadist groups in Idlib are planning a fake chemical attack. The USS Bulkeley (DDG-84), an Arleigh Burke-class destroyer, entered the Mediterranean through the Straits of Gibraltar on Wednesday, the Russian news agency Interfax reported citing international maritime monitoring data. A Gibraltar-watcher confirmed the destroyer’s transit on September 12.

With the arrival of the Bulkeley, the US forces in the region have up to 200 ‘Tomahawk’ cruise missiles available to strike targets in Syria if ordered to do so, Interfax reported. Last week, the attack submarine USS Newport News (SSN-750) arrived in the Mediterranean as well. Last week, Russia conducted massive naval maneuvers off the Syrian coast, culminating in marine landing drills and missile launches. The presence of Russian ships in the area was seen as a possible deterrent to further US military action against Syria.

If a tree falls in a forest…

• No NGO Rescue Boats Currently In Central Mediterranean (G.)

Thousands of migrants risk dying at sea because of a clampdown on NGO rescue ships, aid agencies have warned, in what has been their longest period of absence from the central Mediterranean since they began operating in late 2015. Since 26 August, no NGO rescue vessel has operated on the main migration routes between north Africa and southern Europe. Anti-immigration policies by the Maltese and Italian governments, which have closed their ports to the vessels, have driven the sharp decrease in rescue missions. People seeking asylum are still attempting the risky crossing – but without the boats, shipwrecks are likely to rise dramatically.

The last time the Mediterranean was without NGO rescue boats was from 28 June to 8 July 2018, and in those days more than 300 migrants died at sea. The death toll has fallen in the past year, but the number of those drowning as a proportion of arrivals in Italy has risen sharply in the past few months, with the possibility of dying during the crossing now three times higher.

When we create truly lasting legacies.

• Two More Potential ‘Garbage Patch’ Zones In World’s Oceans Identified (Ind.)

Much attention has focus on the plastic floating on the surface, but this accounts for less than 1 per cent of the total plastic thought to be in ocean. To trace the likely fate of the remaining 99 per cent, scientists at Newcastle University used computer models and identified two likely locations for accumulation zones that had previously slipped under the radar. The Gulf of Guinea region and the East Siberian Sea may be hosting large quantities of plastic that cannot be easily viewed from the water surface, as up to 70 per cent of plastic debris is thought to sink and remain on the sea floor.

“There’s a need to find the unaccounted for plastic in the ocean mainly because if we don’t know the extent of the problem, then there’s no way of knowing the potential implications it has,” explained Alethea Mountford, a PhD Student at Newcastle University who led the study. “Once the plastics reach the water column, the greatest impact would be on marine organisms through ingestion and entanglement,” she said.

A lot of storms. Mangkhut is about to hit the Philippines.

• Florence To Slow Down, Hammer Carolinas and Appalachia for Days (Weather.com)

Hurricane Florence continues to expand in size. Hurricane-force winds now extend outward up to 80 miles the center and tropical-storm-force winds extend outward up to 195 miles from the center. This expansion in size only increases the hurricane’s energy and potential for significant storm surge. The National Hurricane Center noted Wednesday evening that while Florence has weakened some, “the wind field of the hurricane continues to grow in size. This evolution will produce storm surges similar to that of a more intense, but smaller, hurricane, and thus the storm surge values seen in the previous advisory are still valid.” Previous large Category 2 hurricanes have done enormous amounts of damage along the U.S. coast.

Sarah Kendzior tweets:

The best workaround I’ve found to Twitter’s horrible new algorithm is putting this in the search bar:

filter:follows -filter:replies include:nativeretweets

You will get your old chronological timeline back with no “likes” and with retweets from people you actually follow.

Debt Rattle September 12 2018

Sep 122018

September 12, 2018 Posted by Raúl Ilargi Meijer at 9:14 am Finance Tagged with: Armageddon, Brexit, censorship, constitution, copyright, deficit, Florence, Mangkhut, Monsanto, Putin, Skripal 16 Responses »

Vincent van Gogh Mountainous Landscape Behind Saint-Rémy 1888

• US Federal Deficit Soars 32% To $895 Billion (Hill)

• The Fed’s Lost Opportunity to Return to Normal (Rickards)

• China ‘National Team’ Bought Billions In Stocks in Q2 – Goldman (CNBC)

• Putin Bashes Protectionism, ‘Sanctions, Bans And Political Bias’ (CNBC)

• Skripal Poisoning Suspects Are Civilians, Not Criminals, Says Putin (G.)

• UK Police Prepares For Disorder At Ports If UK Crashes Out Of EU (Ind.)

• Barnier Confronts Raab Over Discovery Of Brexit No-Deal Letters To EU27 (G.)

• Europe Is Voting On Controversial Internet Copyright Law (CNBC)

• Americans Need Social Media Guided by the US Constitution (Krieger)

• Internet Industry Group Backs ‘National’ Data Privacy Approach (R.)

• Armageddon Rides In The Balance (PCR)

• Tsipras Warns “Europe Has No Future If It Doesn’t Admit Mistakes” (KTG)

• Monsanto-Bayer Merger Hurts Farmers and Consumers (CP)

• ‘Monster’ Hurricane Florence To Pummel US Southeast For Days (R.)

Steady as she goes.

• US Federal Deficit Soars 32% To $895 Billion (Hill)

The federal deficit hit $895 billion in the first 11 months of fiscal 2018, an increase of $222 billion, or 32 percent, over the same period the previous year, according to the Congressional Budget Office (CBO). The nonpartisan CBO reported that the central drivers of the increasing deficit were the Republican tax law and the bipartisan agreement to increase spending. As a result, revenue only rose 1 percent, failing to keep up with a 7 percent surge in spending, it added. Revenue from individual and payroll taxes was up some $105 billion, or 4 percent, while corporate taxes fell $71 billion, or 30 percent.

The August statistics were somewhat inflated, however, due to a timing shift for certain payments, putting the deficit measure through August slightly out of sync with the previous year, the CBO noted. Had it not been for the timing shift, the deficit would have increased $154 billion instead of $222 billion. Earlier analysis from CBO projected that deficits would near $1 trillion in 2019 and surpass that amount the following year.

With 10 years of such market manipulation that there is no market left, what exactly is normal?

• The Fed’s Lost Opportunity to Return to Normal (Rickards)

Current Fed policy will push the U.S. economy to the brink of recession, possibly by later this year. When that happens, the Fed will have to reverse course and ease monetary policy. Meanwhile, the economic cheerleaders recite recent GDP figures and the stimulative effects of the Trump tax cuts. There’s one problem with the happy talk about 3–4% growth. We’ve seen this movie before. In 2009, almost every economic forecaster and commentator was talking about “green shoots.” In 2010, then-Secretary of the Treasury Tim Geithner forecast the “recovery summer.” In 2017, the global monetary elites were praising the arrival (at last) of “synchronized global growth.”

None of this wishful thinking panned out. The green shoots turned brown, the recovery summer never came and the synchronized global growth was over almost as soon as it began. Strong quarters have been followed by much weaker quarters within six months on six separate occasions in the past nine years. There’s no reason to believe this time will be any different. This expansion has been extraordinarily long — over 30% longer than average — indicating that a recession should be expected sooner rather than later. Into this mix of weak growth comes the Federal Reserve, which is tightening monetary policy, reducing the base money supply and supporting a strong dollar. All of these policies are associated with slower growth ahead and a high probability of recession.

Plunge protection. Imitating ECB.

• China ‘National Team’ Bought Billions In Stocks in Q2 – Goldman (CNBC)

As the mainland Chinese stock market dropped in the second quarter, groups with government ties bought shares, according to a Goldman Sachs analysis. The “national team” of entities related to or influenced by the state was formed in 2015 to help support stocks during that summer’s market turmoil. The Shanghai composite crashed more than 40 percent that year, and has struggled to recover since. The index’s losses accelerated in June, when it fell 20 percent from a recent high, or into a bear market. Beijing’s efforts to reduce the economy’s reliance on debt has led to tighter financial conditions, while rising U.S.-China trade tensions have added to pressure on growth. In all, the Shanghai composite lost 10 percent in the second quarter.

During that time, the national team bought an estimated net 116 billion yuan — or nearly $17 billion — worth of local stocks known as A shares, Goldman Sachs’ Chief China Equity Strategist Kinger Lau said in a Friday report.The second-quarter purchases account for about 0.2 percent of market capitalization and follow sales of 71 billion yuan in the first quarter, Lau said. Overall, his team estimated the national team holds 1.5 trillion yuan worth of A shares, or about 2.9 percent of the listed market capitalization. The findings are based on analysis of required quarterly disclosures of the top 10 shareholders in A share companies.

Source: Goldman Sachs Global Investment Research

Trump unites China and Russia.

• Putin Bashes Protectionism, ‘Sanctions, Bans And Political Bias’ (CNBC)

President Vladimir Putin appeared to take another thinly veiled swipe at Trump’s economic policies on Wednesday, a day after Russia and China vowed to stand together to fight protectionism. “The world and global economy are coming up against new forms of protectionism today with different kinds of barriers which are increasing,” Russian President Vladimir Putin told a plenary session at the Eastern Economic Forum (EEF) in Vladivostok, Russia. “Basic principles of trade — competition and mutual economic benefit — are depreciated and unfortunately undermined, they’re becoming hostages of ideological and fleeting political situations, in that we see a serious challenge for all of the global economy, especially for the dynamically-growing Asia-Pacific and its leadership,” he added.

Putin’s comments come as China and Russia appeared united on Tuesday after the leaders of both countries pledged to stand together to fight protectionism. The comments were seen as a thinly veiled attack on U.S. President Donald Trump who has implemented a massive package of tariffs on Chinese imports and threatened further sanctions on Moscow. [..] Putin said Wednesday that Russia and its eastern economic partners should work to keep trade free of barriers. “We’re convinced that in order for our region to continue to achieve high growth rates, and to remain a key participant in the global economy and trade, it should retain the spirit of economic freedom, to be the space of business initiative without sanctions, bans and political bias ,” Putin told delegates.

With a whole series of CCTV images. Because Russian secret agents on murder missions are too stupid to avoid their photos being taken. There is even one where they take time to ‘pose’ by looking into a shop window with a camera, taken AFTER the ‘attack’.

• Skripal Poisoning Suspects Are Civilians, Not Criminals, Says Putin (G.)

The two men accused by the UK of carrying out a nerve agent attack in Salisbury have been identified and are civilians, not criminals, Vladimir Putin has said. “We know who they are, we have found them,” Putin said at an economic forum in the eastern Russian city of Vladivostok, adding that the two men – named by the UK as Alexander Petrov and Ruslan Boshirov – might soon make appearances in the media to protest their innocence. “These are civilians,” Putin said in remarks reported by Russian news agencies. “There is nothing criminal here.” British officials have said the men were agents of Russian military intelligence dispatched to kill Sergei Skripal, a former Russian spy who had given information to British intelligence. He was imprisoned in Russia before being released in a spy swap in 2010.

Putin’s remarks appeared to be a denial that the men worked for Russia’s military intelligence service the Main Directorate, commonly called the GRU. British officials this month charged the two men in absentia with the attempted murder with novichok of Sergei Skripal, his daughter, Yulia, and a police officer who investigated the scene. Scotland Yard released CCTV images of the two suspects at Salisbury train station on the day of the attack. [..] Putin called on the two men to appear in the media to protest their innocence, saying he “wanted to address them directly”. The Russian’s president’s words marked a departure from his country’s earlier position, which was to disregard the evidence released by Scotland Yard as a fabrication.

And the military too. And this is just what you’re allowed to know.

• UK Police Prepares For Disorder At Ports If UK Crashes Out Of EU (Ind.)

Police are preparing for disorder at British ports in the event of a no-deal Brexit, Metropolitan Police Commissioner Cressida Dick has revealed. The head of Scotland Yard said her force was also bracing for the loss of key European data systems that are “very important” for keeping London safe. She said that the police were conducting careful, calm and sober contingency planning for eventualities, particularly relating to ports in Kent as well as in other parts of the UK. “Is there going to be protests, is there going to be disorder?” she asked, while addressing delegates at the Police Superintendents’ Association conference in Leicester. “At the moment in planning terms it’s a long-way off because there are so many uncertainties that could happen.”

Her comments came after a leaked document prepared by the National Police Coordination Centre revealed the “real possibility” of police calling on the military to help with civil disorder caused by a no-deal Brexit. It warned of traffic queues at ports and said concerns around medical supplies could “feed civil disorder”, while a rise in the price of goods could also lead to “widespread protest” and trigger crimes such as theft. Ms Dick raised additional concerns over the potential loss of access to EU systems including the European Arrest Warrant, Europol and databases containing information on criminals and terrorists entering the UK. “At any one time in my custody suites I will have 35, 40 per cent foreign nationals, over half EU citizens and a huge chunk would have travelled through Europe,” she explained.

The UK still thinks they can make separate deals. It doesn’t understand the EU.

• Barnier Confronts Raab Over Discovery Of Brexit No-Deal Letters To EU27 (G.)

Dominic Raab has been reprimanded by Michel Barnier after the EU’s chief negotiator discovered the British government had written to the 27 other member states asking for side negotiations on transport in the event of a no-deal Brexit. The Brexit secretary was confronted by Barnier during their most recent meeting in Brussels over correspondence sent in recent days to EU capitals by the Department for Transport. The letters had asked the member states to prepare to engage with the British government in side deals on aviation and haulage, to allow key trade flows to continue in the event of the UK and the EU failing to come to an agreement on leaving the union by 29 March 2019.

The transport secretary, Chris Grayling, had ordered the letters to be sent despite being told less than two weeks ago by the European commission’s most senior trade official, Violeta Bulc, that without a deal this autumn, there would be no other agreements made to protect the UK economy. Barnier is said to have reiterated that message to Raab, telling the cabinet minister: “If there is no deal, there is no trust.” The bruising exchange came on the same day that Theresa May told cabinet members the UK should remain “the EU’s closest ally” after Brexit, amid a growing belief in Downing Street that progress was gradually being made in the long-running divorce talks.

A few of them may understand the issues, but the majority sure don’t.

• Europe Is Voting On Controversial Internet Copyright Law (CNBC)

European parliamentarians are set to vote on a controversial copyright law that some critics believe could stop people from sharing memes and articles online. Lawmakers in Strasbourg, France, will cast their votes on the European Union’s new copyright directive on Wednesday. The result of that vote could determine whether large tech companies including Facebook, Twitter and Google are forced to use filtering systems that block copyrighted content. Two particular parts of the directive have attracted the most criticism from pro-internet freedom activists. One is Article 13. This section calls on internet giants to take “appropriate and proportionate” measures to prevent user-generated content that infringes a rightsholder’s copyright.

This part of the law has come under heavy criticism over concerns that tech giants could end up using automated content filtering systems. The law states that “effective content recognition systems” should be put in place by digital companies to prevent copyrighted materials from being distributed on their platforms. Campaigners have scrutinized this part of the legislation over concerns that it could amount to censorship, and argue that the use of copyright-protected material by way of commentary or parody should be permitted under the doctrine of “fair use.” Particular attention has been paid to the status of “memes,” which often rely on copyright protected images or pieces of video, and whether they could be censored as a result.

Echoing a point I’ve been making.

• Americans Need Social Media Guided by the US Constitution (Krieger)

This past Friday, Alex Jones was de-platformed from the last couple of third party tools he had been using to publicly communicate his message after Twitter and Apple permanently banned him and his website Infowars. This means an American citizen with a very large audience who played a meaningful role in the 2016 election, has been banned from all of the most widely used products of communication of our age: Twitter, Facebook, Google’s YouTube and Apple’s iTunes. You can point out he still has his radio show and website, and this is unquestionably true, but when it comes to the everyday tools most people interact with to receive information and communicate in 2018, Alex Jones has been thrown down the memory hole. Not because he was convicted of a crime or broke any laws, but because corporate executives decided he crossed an arbitrary line of their own creation.

It’s not against the law to be crazy or say crazy things in this country. It’s also not against the law to say hateful things. It’s pretty obvious the main reason Alex Jones was deleted from public discourse by Silicon Valley executives relates to his impact and popularity. [..] unabashed bigots like David Duke and Louis Farrakhan continue to have active presences across social media, and rightly so. The difference is neither David Duke nor Louis Farrakhan played a major role in the election of Donald Trump, whereas Alex Jones did. Jones and Infowars were having an outsized impact on the U.S. political discourse in a manner tech giant executives found threatening and offensive, so they collectively found excuses to silence him.

When the outrage mob consisting of politicians, corporate media outlets like CNN, and even his own employees, complained to Twitter’s Jack Dorsey on the issue of Alex Jones, he couldn’t hold the line on free speech because his company’s own policies are junk. Twitter, Facebook and YouTube should have a clear policy when it comes to speech, and it should be this: If it isn’t breaking the law – in other words, if it’s protected speech under the First Amendment – it stays up. Period. When you have corporate rules against “hate speech,” you’re relying on a concept that doesn’t really have any sort of legal standing when it comes to free speech in this country. There is no “hate speech” exception to the First Amendment of the U.S Constitution.

They want to regulate themselves. Don’t let them.

• Internet Industry Group Backs ‘National’ Data Privacy Approach (R.)

A group representing major internet companies including Facebook, Amazon.com and Alphabet said on Tuesday it backed modernizing U.S. data privacy rules but wants a national approach that would preempt California’s new regulations that take effect in 2020. The Internet Association, a group representing more than 40 major internet and technology firms including Netflix, Microsoft and Twitter, said “internet companies support an economy-wide, national approach to regulation that protects the privacy of all Americans.” The group said it backed principles that would ensure consumers should have “meaningful controls over how personal information they provide” is used and should be able to know who it is being shared with.

Consumers should also be able to seek deletion of data or request corrections or take personal information to another company that provides similar services and have reasonable access to the personal information they provide, it said. The group also told policymakers they should give companies flexibility in notifying individuals, set a “performance standard” on privacy and data security protections that avoids a prescriptive approach and set national data breach notification rules. Michael Beckerman, president and chief executive officer of the Internet Association, said in an interview the proposals were “very forward looking and very aggressive” and would push to ensure the new rules apply “economy wide.” He said the group “would be very active working with both the administration and Congress on putting pen to paper.”

Leftwing and intelligence.

• Armageddon Rides In The Balance (PCR)

For some time I have pointed out the paradox of the American liberal/progressive/left being allied with the CIA, FBI, military/security complex and deep state. Now leftist Ann Garrison has noticed the paradox of this alliance. She concludes that the left has lost its mind. Indeed, it has. Out of its hatred of Trump the left has united with the forces of evil and war that are leading to conflict with Russia. The left’s hatred of Trump shows that the American left has totally seperated from the interests of the working class, which elected Trump. The American left has abandoned the working class for the group victimizations and hatreds of Identity Politics. As Hillary put it, the working class comprises the “Trump deplorables.” The Democratic Party, like the Republicans, represents the ruling oligarchy.

I have explained that the leftwing lost its bearings when the Soviet Union collapsed and socialism gave way to neoliberal privatizations. The moral fury of the leftwing movement had to go somewhere, and it found its home in Identity Politics in which the white heterosexual male takes the place of the capitalist, and his victim groups—blacks, women, homosexuals, illegal immigrants—take the place of the working class. The consequences of the leftwing’s alliance with warmongers and liars is the leftwing’s loss of veracity. The left has endorsed a CIA orchestration—“Russiagate”—for which there is no known evidence, but which the left supports as proven truth. The purpose of “Russiagate” is to prevent President Trump from normalizing relations with Russia.

In these times when so many Americans are hard pressed, normal relations could adversely impact the budget and power of the military/security complex by reducing the “Russian threat.” If there is no real Russian threat, only an orchestrated perceived one, the question arises: why does the military/security complex have a taxpayer-supported annual budget of $1,000 billion dollars? The presstitutes have kept the truth from emerging that the “Russiagate” investigation has found no sign of a Trump/Putin plot to steal the 2016 presidential election from Hillary. Indeed, it has been proven beyond all questioning that the Hillary emails were not hacked but were downloaded on a thumb drive. This proof collapses the entire premise of “Russiagate.” Nevertheless, the hoax continues.

He might as well be talking about himself.

• Tsipras Warns “Europe Has No Future If It Doesn’t Admit Mistakes” (KTG)

Europe will have no future if the bloc does not admit mistakes in handling the financial and the migration crisis, Prime Minister warned the European Parliament on Tuesday. Alexis Tsipras said Europe could face an existential crisis over nationalism unless the bloc admits mistakes and its failure to handle a fiscal crisis and the deal with an influx of migrants effectively. The Greek Prime Minister said economic austerity pushed by European governments has fostered fear, racism and the emergence of the far right.“ The economic austerity pursued by European governments had fostered fear, racism and the emergence of the far right, he told lawmakers in the European parliament.

“The EU’s failure to give democratic and effective responses to modern challenges will lead irrevocably to the triumph of chauvinism and will rekindle nationalistic rivalry,” he said. “It will turn it into a fragmented continent, a continent without cohesion, without an international role, and without a future,” he said. Tsipras also criticised Europe’s handling of security and said this could have helped bolster support for far right parties. Several European countries including France and Belgium have seen attacks by Islamist militants in recent years. “The issue at stake is existential for Europe,” said Tsipras. “The handling so far of the financial crisis, the refugee crisis and a security crisis, has exposed huge deficiencies and contradictions.”

“93% of farmers expressed concern that the merger will harm independent farmers and farming communities.”

• Monsanto-Bayer Merger Hurts Farmers and Consumers (CP)

The U.S. Department of Justice issued a stern warning in its lawsuit against the conditionally-approved mega-merger between Bayer and Monsanto in June. The anti-competitive price effects of the merger would, according to the DOJ, “likely result in hundreds of millions of dollars per year in harm, raising costs to farmers and consumers.” The Justice Department warned that the combining of Bayer and Monsanto would reduce competition for vegetable seeds, likely driving up prices. Further, farmers might see prices for GMO cotton, canola, corn and soybean seeds increase, as well as price increases for herbicide and seed treatments. After imposing some limited divestments on Monsanto, the DOJ approved this merger, enabling Monsanto to hide its controversial name brand while giving Bayer anti-competitive control over seeds, pesticides, farmers and consumers worldwide.

But the harm to consumers and farmers will still exist. The DOJ is on the brink of essentially authorizing a monopoly. This is bad news for nearly everyone on the planet except Bayer and Monsanto executives and shareholders. Aside from a combined Bayer-Monsanto, only three other seed companies will be in the market manufacture and sell these products. Farmers overwhelmingly object to the merger. 93% of farmers expressed concern that the merger will harm independent farmers and farming communities. Farmers’ top three concerns were that Bayer/Monsanto “would use its dominance in one product to push sales of other products;” “control data about farm practices;” and that the merger will create “increased pressure for chemically dependent farming.”

Meanwhile, super typhoon Mangkhut is heading straight for Hong Kong.

• ‘Monster’ Hurricane Florence To Pummel US Southeast For Days (R.)

Hurricane Florence, on track to become the first Category 4 storm to make a direct hit on North Carolina in six decades, howled closer to shore on Tuesday, threatening to unleash deadly pounding surf, days of torrential rain and severe flooding. Fierce winds and massive waves are expected to lash the coasts of North and South Carolina and Virginia even before Florence makes landfall by early Friday, bringing a storm surge as much as 13 feet (4 meters), the National Hurricane Center in Miami warned. Catastrophic floods could follow if the storm stalls inland, it said. Although Florence was still days from arrival, authorities took extraordinary measures to move people out of harm’s way. More than 1 million residents have been ordered to evacuate from the coastline of the three states, while university campuses, schools and factories were being shuttered.

The U.S. Coast Guard closed ports in Wilmington and Morehead City, North Carolina and Hampton Roads, Virginia to inbound vessels greater than 500 tons and was requiring vessels of that size to leave if they did not have permission to be in the ports. Packing maximum sustained winds of 140 miles per hour (225 km per hour), the storm ranked as a Category 4 on the five-step Saffir-Simpson hurricane scale and was expected to grow stronger and larger over the next few days, the NHC said. “This storm is a monster,” North Carolina Governor Roy Cooper said. “Even if you’ve ridden out storms before, this one is different. Don’t bet your life on riding out a monster.” He cited forecasts showing Florence was likely to stall over North Carolina, “bringing days and days of rain.”

Graph: weather.com

Debt Rattle September 11 2018

Sep 112018

September 11, 2018 Posted by Raúl Ilargi Meijer at 9:16 am Finance Tagged with: Brexit, Carolinas, Catalonia, evacuations, Florence, Greece, ICC, Korea, Moria, recession, social media, VIPS 10 Responses »

Claude Monet The Manneporte at Étretat 1886

Please Note: The mailing lists I’ve used for many years all of a sudden stopped working. This appears to be because there is some sort of discrepancy between Gmail and Apple Mail. I’ve lost all access to one Gmail account in Apple Mail, though it still works in a browser. Two other Gmail accounts still function in Apple Mail, but bounce back all mails sent as part of the mailing lists. Working on a solution.

Ilargi

• America’s Sub-4% Unemployment Rate Means A Recession Is Not Far Off (Colombo)

• Mass Evacuations Ordered As Hurricane Florence Heads Toward Carolinas (R.)

• EU’s Barnier Says Brexit Deal Still ‘Realistic’ As Deadline Looms (Ind.)

• Three-Bagger (Jim Kunstler)

• Kim Jong Un Asks Trump For Another Meeting In ‘Very Warm’ Letter (R.)

• US Threatens To Arrest ICC Judges Who Probe War Crimes (AFP)

• Moscow Has Upped the Ante in Syria (VIPS)

• Netherlands Ends Support To Syrian Militants & White Helmets (RT)

• Catalan Separatists Plan Mass Rally Tuesday For Independence From Spain (R.)

• Creditors Warn Greece On Debt Relief As Inspectors Return (AP)

• Greece’s Moria Migrant Camp Faces Closure Over Living Conditions (K.)

• US Teens Prefer Remote Chats To Face-to-Face Meeting (AFP)

Not all that glitters is gold.

• America’s Sub-4% Unemployment Rate Means A Recession Is Not Far Off (Colombo)

The strong job market has become a reason for optimism for many Americans in the past couple years in stark contrast to the dark days of the Great Recession and the ensuing “jobless recovery.” The unemployment rate fell beneath 4% for the past several months, weekly jobless claims are at a 49-year low, and wages are growing at their fastest rate since 2009. So, what’s not to like? Obviously, everyone likes good news on the economic front, but these strong job market statistics are a sign that the economic cycle is much closer to the end (including a recession and bear market) rather than the beginning. As the chart below shows, when the U.S. unemployment rate falls under 4%, recessions follow soon after (recessions are marked by the gray shaded areas on the chart).

Historically, U.S. unemployment under 4% is quite rare and typically occurs after a long, powerful economic expansion. By the time the unemployment rate is under 4%, the economic cycle is already mature, the labor market is tight, and inflation is becoming a concern. At this time, the Federal Reserve has been hiking interest rates steadily, which eventually causes the demise of the economic cycle. According to Nicole Smith, chief economist at the Georgetown University Center on Education and the Workforce: “The 4 percent number is not exactly a number that economists are necessarily happy with.” “What’s been happening here is, if we look historically at other times when the unemployment rate has fallen below 4 percent, it’s times where it was the boom phase just before recession or just after a major war period.”

Florence is dangerous. Get out of the way.

• Mass Evacuations Ordered As Hurricane Florence Heads Toward Carolinas (R.)

Mass evacuations were ordered along the U.S. Atlantic Coast as Hurricane Florence, a Category 4 storm and the most powerful to menace the region in nearly three decades, barreled toward the region on Tuesday. Governor Ralph Northam issued an evacuation order for about 245,000 residents in flood-prone coastal Virginia beginning at 8 a.m. local time while South Carolina Governor Henry McMaster has ordered more than 1 million residents along his state’s coastline to leave starting at noon on Tuesday. “This is a serious storm and it’s going to effect the entire state,” Northam told a news conference. “Everyone in Virginia needs to prepare.”

Florence, packing winds of 140 miles per hour (220 kph), was expected to grow even stronger before making landfall on Thursday, mostly likely in southeastern North Carolina near the South Carolina border, the National Hurricane Center in Miami said. North Carolina Governor Roy Cooper told a news conference his state was in “the bull’s eye.” At least 250,000 more people were due to be evacuated from the northern Outer Banks in North Carolina on Tuesday after more than 50,000 people were ordered on Monday to leave Hatteras and Ocracoke, the southernmost of the state’s barrier islands.

North Carolina, South Carolina, Virginia and Maryland governors have declared states of emergency. Authorities warned of life-threatening coastal storm surges and the potential for Florence to unleash prolonged torrential rains and widespread flooding, especially if it lingers inland for several days. NHC Director Ken Graham warned of “staggering” amounts of rainfall that may extend hundreds of miles inland and cause flash flooding across the mid-Atlantic region.

If the UK change their positions, that is.

• EU’s Barnier Says Brexit Deal Still ‘Realistic’ As Deadline Looms (Ind.)

It is “realistic” to believe Britain and the EU will sign a Brexit withdrawal agreement before the looming deadline, Michel Barnier has said. Speaking at the Bled Strategic Forum conference in Slovenia the EU’s chief negotiator said a deal was “possible” in the next six to eight weeks – the cutoff date set for talks. The pound jumped by nearly 1 per cent against the dollar on the foreign exchange markets following the comments, after traders apparently over-interpreted the official’s words. “If we are realistic, I want to reach an agreement on the first stage of the negotiation, which is the Brexit treaty, within six or eight weeks,” Mr Barnier said.

He added: “The treaty is clear, we have two years to reach an agreement before they leave… in March 2019. “That means that taking into account the time necessary for the ratification process in the House of Commons on one side, the European Parliament and the Council on the other side, we must reach an agreement before the beginning of November. I think it is possible.” The episode comes around a week after jumpy financial markets also boosted the pound after Mr Barnier repeated his mantra about wanting to do an ambitious and unique trade deal with the UK. Though little has changed on the ground, both sides of talks are staying publicly positive – if only to give them the upper hand in any ensuing blame game that follows a no deal.

“..a cast of rogue spooks from the CIA, various FBI officers, and British Intelligence in a scheme that is now going to grand juries.”

• Three-Bagger (Jim Kunstler)

The likely confirmation of Brett Kavanaugh may be a last straw for the “Resistance.” It would certainly affect the adjudication of any new disputes that arise over relations between Mr. Trump and Special Counsel Robert Mueller in the weeks ahead. The Mueller investigation into 2016 election “collusion” between Russia and Trump looks more and more like a case of displacement-projection syndrome, since dumpster-loads of evidence now point to collusion between the Hillary campaign, the DNC, a cast of rogue spooks from the CIA, various FBI officers, and British Intelligence in a scheme that is now going to grand juries.

All that nasty business, starting with the news that a grand jury has been secretly grilling former FBI Deputy Director Andrew McCabe for weeks, suggests that events are about to unspool dramatically. The story has been coiling for months as fresh documents emerge and officials, such as the DOJ Inspector General, confirm what they mean. It remains to be seen whether the Web chatter about dozens of “sealed indictments” coming down is horse-shit. The baffling part is the role of Attorney General Jeff Sessions. I’m inclined to doubt that Mr. Trump’s regular vilifications of Sessions are a ruse, meant to mislead the media about the AG’s activities in these matters. But the DC Swamp is unnerved by Sessions’ extraordinary absence of presence on the scene. Has he actually been involved in any of this, or is he playing animal lotto on his desk?

The Korea’s want peace and unison. Let nobody put a loophole, a loophole in their way.

• Kim Jong Un Asks Trump For Another Meeting In ‘Very Warm’ Letter (R.)

U.S. President Donald Trump received a “very warm, very positive” letter from North Korean leader Kim Jong Un asking for a second meeting and the White House is looking at scheduling one, White House spokeswoman Sarah Sanders said on Monday. The two countries have been discussing North Korea’s nuclear programs since their leaders met in Singapore in June, although that summit’s outcome was criticized for being short on concrete details about how and whether Kim is willing to give up weapons that threaten the United States. The likely timing of a second Trump-Kim meeting was unclear.

South Korea’s President Moon Jae-in is scheduled to have his third summit with Kim next week in Pyongyang, and his government had pushed for a three-way summit involving Trump, with the aim of agreeing a joint declaration to end the 1950-53 Korean War. The conflict ended with an armistice, not a peace treaty, leaving the U.S.-led United Nations forces including South Korea technically still at war with North Korea. While South Korea had hoped an accord formally ending the conflict could have been unveiled on the sidelines of the U.N. General Assembly later this month, Moon’s security chief Chung Eui-yong said last week, without elaborating, that the necessary conditions for a three-way meeting were missing.

The ICC was only ever meant to go after Arican dictators fallen out of favor with the west. Bolton protects himself and his ilk.

• US Threatens To Arrest ICC Judges Who Probe War Crimes (AFP)

The United States threatened Monday to arrest and sanction judges and other officials of the International Criminal Court if it moves to charge any American who served in Afghanistan with war crimes. White House National Security Advisor John Bolton called the Hague-based rights body “unaccountable” and “outright dangerous” to the United States, Israel and other allies, and said any probe of US service members would be “an utterly unfounded, unjustifiable investigation.” “If the court comes after us, Israel or other US allies, we will not sit quietly,” Bolton said. He said the US was prepared to slap financial sanctions and criminal charges on officials of the court if they proceed against any Americans.

“We will ban its judges and prosecutors from entering the United States. We will sanction their funds in the US financial system, and we will prosecute them in the US criminal system,” Bolton said. “We will do the same for any company or state that assists an ICC investigation of Americans.” Bolton made the comments in a speech in Washington to the Federalist Society, a powerful association of legal conservatives. Bolton pointed to an ICC prosecutor’s request in November 2017 to open an investigation into alleged war crimes committed by the US military and intelligence officials in Afghanistan, especially over the abuse of detainees. [..] He also cited a recent move by Palestinian leaders to have Israeli officials prosecuted at the ICC for human rights violations.

Veteran Intelligence Professionals for Sanity (VIPS) is made up of former intelligence officers, diplomats, military officers and congressional staffers.

• Moscow Has Upped the Ante in Syria (VIPS)

Mr. President:

We are concerned that you may not have been adequately briefed on the upsurge of hostilities in northwestern Syria, where Syrian armed forces with Russian support have launched a full-out campaign to take back the al-Nusra/al-Qaeda/ISIS-infested province of Idlib. The Syrians will almost certainly succeed, as they did in late 2016 in Aleppo. As in Aleppo, it will mean unspeakable carnage, unless someone finally tells the insurgents theirs is a lost cause. That someone is you. The Israelis, Saudis, and others who want unrest to endure are egging on the insurgents, assuring them that you, Mr. President, will use US forces to protect the insurgents in Idlib, and perhaps also rain hell down on Damascus.

We believe that your senior advisers are encouraging the insurgents to think in those terms, and that your most senior aides are taking credit for your recent policy shift from troop withdrawal from Syria to indefinite war. Russian missile-armed naval and air units are now deployed in unprecedented numbers to engage those tempted to interfere with Syrian and Russian forces trying to clean out the terrorists from Idlib. We assume you have been briefed on that — at least to some extent. More important, we know that your advisers tend to be dangerously dismissive of Russian capabilities and intentions. We do not want you to be surprised when the Russians start firing their missiles.

The prospect of direct Russian-U.S. hostilities in Syria is at an all-time high. We are not sure you realize that. The situation is even more volatile because Kremlin leaders are not sure who is calling the shots in Washington. This is not the first time that President Putin has encountered such uncertainty . This is, however, the first time that Russian forces have deployed in such numbers into the area, ready to do battle. The stakes are very high. We hope that John Bolton has given you an accurate description of his acerbic talks with his Russian counterpart in Geneva a few weeks ago. In our view, it is a safe bet that the Kremlin is uncertain whether Bolton faithfully speaks in your stead, or speaks INSTEAD of you.

A government spending million to support what it itself has labeled ‘terrorists’. We’re not even surprised. Standard fare in the west.

• Netherlands Ends Support To Syrian Militants & White Helmets (RT)

The Netherlands has decided to end its support to militants in Syria, since the program did not yield “expected” results. The move comes as journalists found one of the groups had been labeled as terrorists by the country itself. “The opportunity to quickly change the situation [in Syria] is extremely small,” reads the letter the lower house of the parliament by Dutch Foreign Minister Stef Blok and Minister for Foreign Trade Sigrid Kaag, announcing the end of support programs for the militants in Syria. The program to support of “moderate” anti-government groups in Syria was established in close cooperation with “like-minded donors who pursued the same goals as the Netherlands” and cost the country over $80 million over the years, according to the document.

It failed to “bring the expected results,” however, and is to be closed since the Syrian troops “will soon win” the war against militant groups. Over the years, the Netherlands allocated $29 million to the so-called “non-lethal assistance” (NLA) program, $14.5 million were donated to the so-called White Helmets and $17.1 million went to the Access to Justice and Community Service (AJACS) program. The AJACS was supposedly designed to support “community police” work in Syria, specifically the so-called Free Syrian Police (FSP) group. The support for militants is set to end immediately, yet the White Helmets will be funded until December, according to the document.

Since the White Helmets now operate only in the Idlib province, which is believed to be the destination of the looming offensive by the Syrian Army and its allies, their future is quite doubtful, the document states. [..] The “non-lethal” goods supplied by the Dutch government included satellite phones, uniforms, assorted equipment and even the ‘iconic’ Toyota Hilux pick-up trucks, widely used by various militant groups in Syria. At least one of the groups supplied by the Netherlands, Jabhat al-Shamiya, turned out to be labeled a terrorist group by the country’s own justice department, the journalists have revealed. One Dutch man is currently prosecuted for joining the group back in 2015, with the indictment describing it as a “salafist and jihadist” movement which can qualify only as a “criminal organization with terrorist intent.”

What year is it?

• Catalan Separatists Plan Mass Rally Tuesday For Independence From Spain (R.)

Hundreds of thousands of Catalans are expected to fill the streets of Barcelona on Tuesday for the Spanish region’s first commemorative day since its leader declared independence last year and pitched the country into constitutional crisis. Supporters of splitting the wealthy northeastern region from the rest of Spain have in recent years used the Sept. 11 “Diada”, the anniversary of the fall of their coastal capital to Spanish forces in 1714, to promote the cause. This year, Catalonia’s leader Quim Torra, who took over from his exiled predecessor after Madrid ended an unprecedented period of direct rule, has called for a mass rally in support of his bid for a binding referendum on independence.

“Our government has committed to making the republic a reality,” Torra said in a televised address to mark the occasion. “I wish you all a very good Diada. Long live free Catalonia.” He wore a yellow ribbon signifying support for nine politicians whose jailing for their role in the independence bid is one of the Catalan government’s biggest grievances. Socialist Prime Minister Pedro Sanchez, who took power in June, has taken a softer approach to one of the thorniest issues in national politics than that of his conservative predecessor Mariano Rajoy, but he has stood firm against allowing a vote on secession, or any unilateral attempt by Catalonia to secede.

Last year’s Diada, in which marchers often climb on each other’s shoulders in shows of the traditional sport of forming human towers, fell as the regional government was preparing to hold a referendum in defiance of Madrid, which ultimately sent riot police to try to stop the vote.

Sovereignty, 2018.

• Creditors Warn Greece On Debt Relief As Inspectors Return (AP)

Greece’s lead creditor warned the country on Monday not to stray from reforms agreed upon before the end of its international bailout, as European monitors arrived to check the nation’s finances. The five-day inspection is expected to focus on government promises over the weekend to offer tax relief as well as plans to scrap promised pension cuts that are due to take effect in 2019. Klaus Regling, managing director of the European Stability Mechanism, the eurozone’s rescue fund, told Austria’s Die Presse newspaper that Greece’s needed to stick to its commitments. “We are a very patient creditor. But we can stop debt relief measures that have been decided for Greece if the adjustment programs are not continued as agreed,” he said.

“The debt level appears to be frighteningly elevated. But Greece can live with that as the loan maturities are very long and the interest rates on the loans are much lower than in most other countries.” Left-wing Prime Minister Alexis Tsipras is trailing opposition conservatives in opinion polls and must call a general election within the next 12 months. Amid large protest rallies led by labor unions over the weekend, the prime minister said that relief measures promised to taxpayers would not jeopardize fiscal performance targets and would be introduced gradually. Greece has promised to deliver high primary surpluses — the budget balance before calculating the cost of servicing debt — for years to come, along with a series of reforms in exchange for better debt repayment terms.

The end of the bailout means Greece will have to return to international capital markets to finance itself. However, the country faces a troubled return after the financial turmoil in Turkey and Italy halted a decline in Greek borrowing rates. The yield on Greece’s 10-year-bond remains above 4 percent. The bailout program ended Aug. 20 but the country’s debt level remains near 180 percent of gross domestic product.

Let’s see what happens in the next 30 days.

• Greece’s Moria Migrant Camp Faces Closure Over Living Conditions (K.)

The Regional Authority of the Northern Aegean has given the Ministry of Migration Policy 30 days to clean up the overcrowded Moria hot spot for migrants and refugees on the island of Lesvos, or face closure. The announcement is part of a report compiled by environmental and health inspectors from Lesvos’ public health directorate who found the camp is unsuitable and dangerous for public health and the environment. According to the report, inspectors said there is an uncontrolled wastewater spill at the entrance of the camp, which ends into an adjacent stream or even on the road.

In another section of the camp, toilet waste pipes are broken, resulting in a strong stench and creating a danger to public health. Inspectors said the overcrowding living conditions in Moria, in which up to 15 people are squeezed into the small houses and up to 150 in every tent, increases the risk of disease transmission. “There was also a strong stench and insects (flies) due to the inability to properly clean the living quarters,” the report added. North Aegean Regional Governor Christiana Kalogirou says the ministry will have to restore every damage or problem detailed in the report, otherwise the authority will forbid the hot spot’s operation.

It’ll take years to assess the damage. And then it’ll be too late.

• US Teens Prefer Remote Chats To Face-to-Face Meeting (AFP)

American teenagers are starting to prefer communicating via text instead of meeting face-to-face, according to a study published Monday by the independent organization Common Sense Media. Some 35% of kids aged 13 to 17 years old said they would rather send a text than meet up with people, which received 32%. The last time the media and technology-focused nonprofit conducted such a survey in 2012, meeting face-to-face hit 49%, far ahead of texting’s 33%. More than two-thirds of American teens choose remote communication — including texting, social media, video conversation and phone conversation — when they can, according to the study. In 2012 less than half of them marked a similar preference.

Notably, in the six-year span between the two studies the proportion of 13 to 17-year-olds with their own smartphone increased from 41 to 89%. As for social networks, 81% of respondents said online exchange is part of their lives, with 32% calling it “extremely” or “very” important. The most-used platform for this age group is Snapchat (63%), followed by Instagram (61%) and Facebook (43%). Some 54% of the teens who use social networks said it steals attention away from those in their physical presence. Two-fifths of them said time spent on social media prevents them from spending more time with friends in person. The study was conducted online with a sample of 1,141 young people ages 13 to 17, from March 22 to April 10.