Apr 012023
 
 April 1, 2023  Posted by at 9:00 am Finance Tagged with: , , , , , , ,  58 Responses »


Willem de Kooning Door to the river 1960

 

The Capital of the Multipolar World: A Moscow Diary (Pepe Escobar)
US Urges Americans To Leave Russia ‘Immediately’ (RT)
Nebenzya: Without Russia the UN Will Lose Its Meaning (TASS)
ICC’s Putin Arrest Warrant Based On US-funded Report That Debunked Itself (GZ)
Europe Needs Russia To Survive – Lukashenko (RT)
China’s Xi Is Right: Changes Not Seen For A Century (Lukyanov)
From Iraq War To Arming Ukraine. Where Will This Lead? (Sushenstov)
Comparing Beijing, Minsk Peace Plans In Ukraine Inappropriate – Kremlin (TASS)
West Can’t Sweep Nord Stream Sabotage Under The Carpet – Diplomat (TASS)
Russian Needs Major Effort In Bakhmut Despite Heavy Kiev Losses – Wagner (TASS)
EU Underestimates Russian Economic Capacity – Orban (RT)
Norway’s Wealth Fund Unable To Withdraw Funds From Russia (RT)
‘Peacekeepers’ Deployed To Ukraine Without Russia’s Consent – Medvedev (TASS)
Did They Light Up a Cigarette Afterward? (Kunstler)
Manhattan Assistant DA Nukes Twitter Account After Anti-Trump Bias Exposed (ZH)
The Trump Indictment: Making History in the Worst Possible Way (Turley)
Stirrings of Euro Eco-rebellion (Higgie)

 

 

 

 

Dowd

 

 

“Gates, the WHO, a ton of these universities: they’re all talking about including mRNA vaccinations as part of the food. They’re gonna modify the genes of these foods to make them mRNA vaccines,” warned attorney @TomRenz. Missouri HB 1169 seeks to counter such an effort. It’s been described as “one of the most controversial bills in history,” but all it is – is a labeling bill. If a food product is a gene therapy product, you have every right to know. So, if this bill gets passed, it’s a major victory not just for our well-being — but also for discovery, too.
https://twitter.com/i/status/1641990297142829056

 

 

 

 

Trump team
https://twitter.com/i/status/1641827495426113536

 

 

Tucker Trump
https://twitter.com/i/status/1641973692740833281

 

 

Beck
https://twitter.com/i/status/1641603632100524035

 

 

 

 

Ursula

 

 

Kneissl

 

 

 

 

 

 

Western media refuse to report on the major changes happening. How does that serve their audience?

The Capital of the Multipolar World: A Moscow Diary (Pepe Escobar)

How sharp was good ol’ Lenin, prime modernist, when he mused, “there are decades where nothing happens; and there are weeks where decades happen”. This global nomad now addressing you has enjoyed the privilege of spending four astonishing weeks in Moscow at the heart of an historical crossroads – culminating with the Putin-Xi geopolitical game-changing summit at the Kremlin. [..] The initial gut feeling the day I arrived, after a seven-hour walk under snow flurries, was confirmed: this is the capital of the multipolar world. I saw it among the West Asians at the Valdai. I saw it talking to visiting Iranians, Turks and Chinese. I saw it when over 40 African delegations took over the whole area around the Duma – the day Xi arrived in town. I saw it throughout the reception across the Global South to what Xi and Putin are proposing to the overwhelming majority of the planet.

In Moscow you feel no crisis. No effects of sanctions. No unemployment. No homeless people in the streets. Minimal inflation. Import substitution in all areas, especially agriculture, has been a resounding success. Supermarkets have everything – and more – compared to the West. There’s an abundance of first-rate restaurants. You can buy a Bentley or a Loro Pianna cashmere coat you can’t even find in Italy. We laughed about it chatting with managers at the TSUM department store. At the BiblioGlobus bookstore, one of them told me, “We are the Resistance.”

By the way, I had the honor to deliver a talk on the war in Ukraine at the coolest bookshop in town, Bunker, mediated by my dear friend, immensely knowledgeable Dima Babich. A huge responsibility. Especially because Vladimir L. was in the audience. He’s Ukrainian, and spent 8 years, up to 2022, telling it like it really was to Russian radio, until he managed to leave – after being held at gunpoint – using an internal Ukrainian passport. Later we went to a Czech beer hall where he detailed his extraordinary story. In Moscow, their toxic ghosts are always lurking in the background. Yet one cannot but feel sorry for the psycho Straussian neocons and neoliberal-cons who now barely qualify as Zbig “Grand Chessboard” Brzezinski’s puny orphans.

In the late 1990s, Brzezinski pontificated that, “Ukraine, a new and important space on the Eurasian chessboard, is a geopolitical center because its very existence as an independent state helps transform Russia. Without Ukraine, Russia ceases to be a Eurasian empire.” With or without a demilitarized and denazified Ukraine, Russia has already changed the narrative. This is not about becoming a Eurasian empire again. This is about leading the long, complex process of Eurasia integration – already in effect – in parallel to supporting true, sovereign independence across the Global South.

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This is hilarious. Blinken and Jean-Pierre tell everyone to “depart immediately”, and then “National Security Council spokesperson” Kirby “explained Washington was not actually calling upon all Americans to literally leave Russia and was not encouraging news outlets to withdraw their correspondents from the country.”

Leave, but not literally?! Do note Russia says they caught Gershkovich “red-handed”…

US Urges Americans To Leave Russia ‘Immediately’ (RT)

Washington has called upon Americans who are traveling to or residing in Russia to leave the country “immediately” in the aftermath of the arrest of Wall Street Journal (WSJ) correspondent Evan Gershkovich. While Moscow said he was caught “red-handed” trying to obtain state secrets, the US has condemned the arrest as an assault on “press freedom.” US Secretary of State Antony Blinken said Washington was “deeply concerned” about the development, adding that “in the strongest possible terms, we condemn the Kremlin’s continued attempts to intimidate, repress, and punish journalists and civil society voices.”

“We reiterate our strong warnings about the danger posed to US citizens inside the Russian Federation. US citizens residing or traveling in Russia should depart immediately,” the top diplomat said in a statement. A similar message was conveyed by the White House, with Press Secretary Karine Jean-Pierre stating that the “targeting of American citizens by the Russian government is unacceptable.” “We also condemn the Russian government’s continued targeting and repression of journalists and freedom of the press,” she added, urging Americans to “heed the US government’s warning to not travel to Russia” or leave should they happen to already be in the country.

The call was somewhat watered down by US National Security Council spokesperson John Kirby, who explained Washington was not actually calling upon all Americans to literally leave Russia and was not encouraging news outlets to withdraw their correspondents from the country. Gershkovich, a WSJ correspondent who covers news from Russia, Ukraine, and the former USSR, was detained in the city of Ekaterinburg on suspicion of espionage, Russia’s Federal Security Service (FSB) announced earlier in the day. According to Kremlin spokesman Dmitry Peskov, the journalist was caught “red-handed” while trying to obtain Russian state secrets.

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“Apparently, the collective West’s thinking is that children, in particular, orphans, are better left in the war zone.”

Nebenzya: Without Russia the UN Will Lose Its Meaning (TASS)

Will the informal meeting of the UN Security Council on the “Arria formula” on children evacuated from the Ukrainian conflict zone touch upon the issue of their return, as you mentioned at the press conference? The “Arria formula” meeting is designed to bring to the international community first-hand information about evacuated children from the war zone in Donbass and Ukraine and dispel the false narrative spread by the Western media about the alleged “abductions” of children from Ukraine and attempts to “destroy their identity.” I would like to emphasize once again that we are talking about evacuation from the war zone in full compliance with the obligations under International Humanitarian Law, as well as the Convention on the Rights of the Child. Apparently, the collective West’s thinking is that children, in particular, orphans, are better left in the war zone.

From the beginning of the special military operation to the present, millions of people have been evacuated in this way, including children, who in the overwhelming majority of cases arrived on the territory of Russia with their parents, guardians and trustees. Only a small number of evacuated children were in institutions for orphans and children left without parental care. Children who were pupils at institutions located within the administrative boundaries of the DPR and LPR at the time of recognition of their independence by the Russian Federation were transferred under guardianship. Great attention was paid to the placement of minors in the families of blood relatives living in Russia. The Westerners’ use of the term “adoption” in this context is deliberately misleading. In reality, we are talking about temporary preliminary guardianship or temporary guardianship.

The main goal is for children to be in families, not orphanages. This form was chosen specifically taking into account the potential reunification of minors with their blood relatives, if any are found. The Russian side does not prevent children from maintaining contact and communication with their relatives and friends, regardless of their place of residence. To simplify the reunification process, parents can seek help finding their child directly from the office of the Russian Commissioner for Children’s Rights. To this day, with the participation of the Commissioner for Children’s Rights, 15 children from 8 families have already been reunited with their relatives. We have held a number of meetings with representatives of the Regional Delegation of the International Committee of the Red Cross in the Russian Federation and the Republic of Belarus, who also decided to facilitate the reunification of children with parents outside the Russian Federation and Ukraine (in Poland, Portugal and Norway), within the framework of the organization’s mandate.

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Jeremy Loffredo and Max Blumenthal for the Grayzone.

ICC’s Putin Arrest Warrant Based On US-funded Report That Debunked Itself (GZ)

On March 17, the Prosecutor General of the International Criminal Court, Karim Khan, introduced an arrest warrant for Russian President Vladimir Putin and his Commissioner for Children’s Rights, Maria Llova-Belova. The warrant, which accused Putin and Lolva-Belova of conducting the “unlawful deportation” of Ukrainian children to a “network of camps” across the Russian Federation, inspired a wave of incendiary commentary in the West. US Sen. Lindsey Graham, perhaps the most aggressive cheerleader in Congress for war with Russia, proclaimed: “The ICC has an arrest warrant for Putin because he has organized the kidnapping of at least 16,000 Ukrainian children from their families and sent them to Russia. It is exactly what Hitler did in World War II.” CNN’s Fareed Zakaria echoed Graham, declaring the ICC warrant revealed that Putin “is in fact following parts of Hitler’s playbook.”

The ICC prosecutor appeared to have based his arrest warrant on research produced by Yale University’s Humanitarian Research Lab (HRL). Yale HRL’s work was funded and guided by the State Department’s Bureau of Conflict and Stabilization Operations, an entity the Biden administration established in May 2022 to advance the prosecution of Russian officials. During an interview with CNN’s Anderson Cooper, Yale HRL’s executive director, Nathaniel Raymond, claimed his report provided proof that “thousands of children are in a hostage situation.” Invoking the Holocaust, Raymond asserted, “We are dealing with the largest network of children camps seen in the 21st century.”

Yet in an interview with Jeremy Loffredo, the co-author of this report, and in his own paper for Yale HRL, Raymond contradicted many of the bombastic claims he made to the media about child hostages. During a phone conversation with Loffredo, Raymond acknowledged that “a large amount” of the camps his team investigated were “primarily cultural education – like, I would say, teddy bear.” Yale HRL’s report similarly acknowledges that most of the camps it profiled provided free recreational programs for disadvantaged youth whose parents sought “to protect their children from ongoing fighting” and “ensure they had nutritious food of the sort unavailable where they live.” Nearly all of the campers returned home in a timely manner after attending with the consent of their parents, according to the paper. The State Department-funded report further concedes that it found “no documentation of child mistreatment.”

Yale HRL based its research entirely on Maxar satellite data, Telegram postings, and Russian media reports, relying on Google translate to interpret them and at times misrepresented the articles in its citations. The State Department-funded unit conceded that it performed no field research for its paper, stating that it “does not conduct ground-level investigations and therefore did not request access to the camps.” Unlike the Yale investigators who inspired the ICC’s arrest warrant, Loffredo gained unfettered access to a Russian government camp in Moscow that houses youth from the war-torn Donbas region. Though it is precisely the kind of center that Yale HRL – and by extension, the ICC – have portrayed as a “re-education camp” for Ukrainian child hostages, he found a hotel full of happy campers receiving free classical music lessons in their native Russian language from first-class instructors – a “teddy bear,” as Raymond called it.

At The Donbas Express music camp located just outside of Moscow, youth told Loffredo they were grateful to have found refuge from the Ukrainian army’s years-long campaign of shelling and besiegement of their homeland. By fleeing the war in Donbas, these children had escaped a nightmarish military conflict for which Yale HRL and the ICC have demonstrated little to no concern.

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The UN needs Russia, and Europe needs Russia.

Europe Needs Russia To Survive – Lukashenko (RT)

The world is currently witnessing “the destruction of Europe,”Belarusian President Alexander Lukashenko told the national parliament in an annual address on Friday. The continent is losing its independence because Western nations are turning into US satellites, the Belarusian leader believes. Only uniting with Moscow could stop that, he said. “The policy of the European Union, both foreign and internal, has become totally subordinated to US interests,” Lukashenko said, as he accused European leaders of lacking the political will to make their nations truly independent in international affairs. According to Lukashenko, the US has long been pursuing a policy of economic suppression against the EU. The emergence of Europe’s own competitive currency, the euro, has prompted the US to start “suffocating” its “subjects,” he stated.

Washington is also using the ongoing conflict in Ukraine to “stall” Europe, the Belarusian president added. The only way out for Europe is to join forces with Russia, Lukashenko said. “Europe can survive only together with us, primarily with Russia,” he told the lawmakers. “If Russia and Europe unite, it will be a powerhouse no one can beat.” The statements were made as Russia unveiled its revised foreign policy concept. The document, which outlines the nation’s strategic priorities, called the “anti-Russian policy” of the US a major threat to international peace. At the same time, Moscow maintained that it did not consider Western nations to be adversaries and was ready for dialogue and cooperation on the basis of mutual respect.

The developments came amid the ongoing military conflict between Russia and Ukraine, in which the EU followed the US in supporting Kiev with both military and financial aid while slapping Moscow with unprecedented sanctions. The EU has also tried to get rid of Russian oil and gas imports, which has negatively impacted European nations that were previously heavily dependent on Russian energy imports, like Germany. Although the German government announced in January that the country would narrowly avoid a recession this year, credit ratings agency Fitch predicted earlier this month that the German economy would enter recession by late 2023.

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“We will take our cue from Xi, who sees the changes taking place as a sign of necessary renewal. And we will manage the costs somehow.”

China’s Xi Is Right: Changes Not Seen For A Century (Lukyanov)

The second half of the twentieth century and the beginning of the twenty-first have been very comfortable times for the world as a whole. In terms of the overall geopolitical arrangement, we saw first a rather strong balance based on bipolar confrontation, then a relatively stable hegemony. But there has also been progress in the social and economic senses. Many positive changes took place after the Second World War. The welfare state model spread across most of Europe, and even the United States, with its more modest traditions in this sphere, made great strides. Similar changes also took place on the other side of the Iron Curtain, with a focus on improving living standards and consumer diversity added to the traditional priorities of defence. In the Third World, as colonial possessions were disappearing there was an enthusiasm for freedom and a belief in the future. Even if many of the new states carried little heft.

The end of the Cold War brought with it new expectations. The ‘free world’ enjoyed a ‘peace dividend’ (reduced military spending) and the opportunity to extend its economic expansion into previously closed areas. The former socialist countries took advantage of the opening up in every way they could and – at least for individuals – there were more opportunities than before. This was often to the detriment of state capacity, but it was believed that this was the general trend – the individual was more important. Eventually, the former Third World tried to take advantage of both. Many countries in Asia, for example, have benefited greatly from globalization. Meanwhile, a lot of people from states which have underachieved have chosen to move to wealthier locations.

Both periods had one thing in common – a widespread feeling that tomorrow would be better than yesterday. However, now, just like that, it’s over. At present, it’s commonplace to accuse political elites of unprofessionalism and bad governance. Without making excuses for individual politicians, the current generation – which grew up in these very favourable conditions – has had to deal with shifts of a tectonic nature. The exhaustion of the previous financial model of the capitalist economy, the communications revolution (one of the main results of which is the mental divide between the mature and the young), technological change with inevitable consequences for the labour market, an ageing population in the developed countries, and a rejuvenation in previously troubled states is creating a completely different international environment.

Moreover, the interconnectedness of the planet does not allow anyone to isolate themselves from the general instability, which spills over national borders in various forms. Moreover, as was the case a century ago, the growth of socio-political activism among the masses is leading to the radicalization of political groups. And with traditional parties and ideologies in deep crisis, radicalization can take quite archaic forms. We will take our cue from Xi, who sees the changes taking place as a sign of necessary renewal. And we will manage the costs somehow.

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“America at the Apex.”

From Iraq War To Arming Ukraine. Where Will This Lead? (Sushenstov)

This year’s twentieth anniversary of the illegal Iraq invasion paradoxically coincided with major international events. Xi Jinping, General Secretary of the Central Committee of the Communist Party of China, was in Moscow on the day, while a Russia-Africa Parliamentary Forum opened at the same time. In 2003, at the height of its power, the US proclaimed its “unipolar moment” in which it would dominate unchallenged, needing no allies and tolerating no objections from adversaries. History, it was believed, had a single purpose, and they would stop at nothing to achieve it. Indeed, American military, political and economic dominance seemed total at the time, echoing the sentiments of Henry Kissinger, who a few years earlier had written that “America at the Apex.”

Twenty years later, we are witnessing the flowering of multi-polarity: in Moscow, the General Secretary of the Central Committee of the Communist Party of China talking to the Russian President, two countries contributing to a change the world has not seen in a hundred years. This transience of world history shows how quickly historical cycles change, but it is also important that the US itself, through its actions in different parts of the world, is accelerating its course. One of the most important strategic mistakes made by Washington was the invasion of Iraq. Based on a false pretext and deliberately misleading the international community, it led to a series of serious war crimes, a catastrophic civil war, the shattering of Iraqi statehood and significant repercussions for the entire Middle East.

Just a few years of American presence in Iraq resulted in huge numbers civilian deaths, indiscriminate use of force, and the destruction of several cities, including Mosul. During the evacuation of the Russian embassy during the 2003 US invasion, a convoy of diplomats came under US fire and several were injured. US private military contractors, who at one point had the same presence in the country as official troops, committed a number of war crimes. The abuse of prisoners by the US military at Abu Ghraib prison near Baghdad has been well documented. When the International Criminal Court raised the question of the responsibility of American citizens being charged over offenses in Afghanistan and Iraq, the US responded by saying that it would prosecute the judges who raised the issue and that they should withdraw their initiatives immediately. Arguably the greatest crime of the US in Iraq has been to create a civil war that has resulted in a terrible number of casualties with estimates ranging from 600,000 to one million.

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“..a number of provisions of China’s plan were unlikely to materialize right away, as Kiev was unable to disobey the West.”

Comparing Beijing, Minsk Peace Plans In Ukraine Inappropriate – Kremlin (TASS)

It will be inappropriate to compare the two sets of ideas for a peace settlement in Ukraine, proposed by Chinese President Xi Jinping and Belarusian President Alexander Lukashenko, Russian Presidential Spokesman Dmitry Peskov told the media on Friday. “We believe it will be hardly appropriate to compare these two sets of ideas, I mean the plan that was voiced by [Chinese] President Xi [Jinping] and the one that [Belarusian] President Alexander] Lukashenko has just mentioned,” the Kremlin spokesman said. He also noted that Russian President Vladimir Putin had discussed with Xi the plan proposed by China and some of its individual provisions. At the same time, according to Peskov, a number of provisions of China’s plan were unlikely to materialize right away, as Kiev was unable to disobey the West.

“The plan [peace plan proposed by China] has not been put on hold, but there are certain provisions that, so to say, cannot be implemented for now due to the inability of the Ukrainian side to disobey its patrons, its commanders,” Peskov said. “These commanders, as we know, are not in Kiev. They insist that the war should continue,” he added. On March 20-22, Xi Jinping paid a state visit to Moscow. Among other things he discussed with Russian President Vladimir Putin China’s plan for a peace settlement in Ukraine. The Russian leader said afterwards that many of the provisions of that plan were in line with Russia’s own approaches and could be used as the basis for a peace settlement, when the West and Kiev were ready for it.

Earlier on Friday, Lukashenko, in his address to the people and parliament of Belarus, called for declaring truce in Ukraine “without the right to move and regroup troops on both sides and without the right to move weapons and ammunition, manpower and equipment.” Lukashenko explained that in such a situation, “if the West once again tries to use the pause to deceitfully strengthen its positions, Russia will be obliged to use the entire strength of its military-industrial complex and the army to prevent an escalation of the conflict.”

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Nebenzya comes to the front. Yet another erudite spokesman.

West Can’t Sweep Nord Stream Sabotage Under The Carpet – Diplomat (TASS)

The West will not be able to “sweep under the carpet” the topic of sabotage on the Nord Stream and Nord Stream 2 gas pipelines, Russian Permanent Representative to the United Nations Vasily Nebenzya said in an exclusive interview with TASS. Russia will take the chair of the UN Security Council in April. According to the diplomat, when voting on March 27 in the UN Security Council on a draft resolution on the establishment of an international commission to investigate the circumstances of sabotage, the United States and its allies “preferred to hide behind the “front” of convenient national investigations in Germany, Denmark and Sweden.” “The tactics of our Western colleagues do not surprise us – after all, as we once again became convinced from the recent investigation of the autoritative American journalist Seymour Hersh, all the evidence points to who is behind the explosions on the Nord Stream,” Nebenzya said.

“The behavior of the United States and Western countries during the discussion of this topic at the Council platform, including the eloquent silence of the American delegates in response to the reminder of the threats against the gas pipeline from the American leadership, only reinforces these suspicions. But unfortunately for their Western colleagues they will not be able to “sweep under the carpet” this topic. We will continue to strive to ensure that the true circumstances of what happened are established, and all those responsible are punished,” the diplomat stressed.

Nebenzya noted that during the discussion of this initiative, Russia’s representatives showed “the most flexible and responsible approach, and a balanced text was put to a vote, taking into account the concerns expressed by states.” “Its adoption was supported by such major players as China and Brazil. However, the United States and its allies, of course, did not come out in favor,” the diplomat stated. He noted that “investigations in Germany, Denmark and Sweden, whose objectivity is questionable” for Russia “given that the authorities of these countries, without any clear reason, refused to cooperate” with the Russian competent authorities.

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The fields are mud. Russia is not in a hurry.

Russian Needs Major Effort In Bakhmut Despite Heavy Kiev Losses – Wagner (TASS)

The Ukrainian military is suffering serious casualties in Artyomovsk (called Bakhmut in Ukraine) but Russian troops still have to take enormous efforts in that area, Yevgeny Prigozhin, founder of the Wagner private military company, said on Friday. “No, the Ukrainian army is not fleeing anywhere. The Ukrainian army is engaged in bloody battles and is defending Artyomovsk at the expense of serious casualties,” the Wagner press office quoted Prigozhin as saying on its Telegram channel. “Another important aspect that should be mentioned is the need to hold the flanks,” he stressed. “Today we need to concentrate efforts in the city because this is an enormous amount of combat work to do. The flanks should not let us down and allied units should hold them,” Prigozhin said.

Russian forces “are moving forward and taking every building, every building entrance and every garage between buildings,” he said. “In Bakhmut, there are about 800 high-rise buildings. If we tell about each [building] entrance, you will be tired of hearing it. When we take Bakhmut, then we will talk about that,” the Wagner founder said. Artyomovsk is located on the Kiev-controlled part of the Donetsk People’s Republic and is a major transportation hub for the Ukrainian army’s supplies in Donbass. Fierce fighting for the city is underway.

Yan Gagin, military-political expert and adviser to the acting head of the Donetsk People’s Republic (DPR), said on March 22 that the city had been practically sealed off by Russian forces and all approaches to Artyomovsk were under Russian artillery control. He earlier said that Russian forces controlled about 70% of the city. Acting DPR Head Denis Pushilin has repeatedly said that there is no evidence of the Ukrainian army’s plans to leave Artyomovsk. Meanwhile, Kiev claims that the city’s defense will be bolstered. Ukrainian President Vladimir Zelensky earlier said that Ukrainian troops would not surrender Artyomovsk and would fight for it as long as they could.

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“Russia’s foreign trade grew by more than 8% last year, while inflation is expected at around 4% this year. This comes as “other Europeans” are trying “to convince everyone of the imminent collapse of the Russian economy..”

EU Underestimates Russian Economic Capacity – Orban (RT)

Western countries are making a mistake by underestimating Russia’s ability to adapt to sanctions, Hungarian Prime Minister Viktor Orban stated on Friday. According to Orban, Moscow demonstrated it could adjust its economy to restrictions following the first wave of Western sanctions, introduced after Crimea voted to secede from Ukraine and to reunify with Russia. “I remember well that in 2015 we exported a lot of food products to Russia…In three years, Russia has built its agriculture and food industry to such an extent that if Hungary wanted to export food there today, it would either not work or be much more difficult than before the imposition of sanctions,” the politician told Kossuth Radio.

The Russian economy has shown its resilience to sanctions and “underestimating” the ability of a country as “huge” as Russia to adapt to restrictions is a “fatal mistake,” Orban added. The Hungarian premier is a vocal critic of the bloc’s approach to the conflict in Ukraine, and has repeatedly argued that sanctions are hurting the EU more than they hurt Russia. Earlier, Orban said that the punitive measures “were supposed to hit Russia, but hit Europe.” The anti-Russia measures have had a devastating impact on Budapest, by sending energy prices soaring and raising costs throughout the economy.

According to the prime minister, EU sanctions introduced against Russia over its military operation in Ukraine have cost Hungary’s economy €10 billion but have failed to stop the conflict. Meanwhile, Russia has survived the loss of Western markets and its economy is developing in a new way, with GDP expected to grow as soon as the second quarter of this year, President Vladimir Putin said earlier in March. Russia’s foreign trade grew by more than 8% last year, while inflation is expected at around 4% this year. This comes as “other Europeans” are trying “to convince everyone of the imminent collapse of the Russian economy,” even though EU inflation rates are higher, the Russian president noted.

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“..a wrapped gift to the oligarchs who buy our shares.”

Norway’s Wealth Fund Unable To Withdraw Funds From Russia (RT)

Norway’s $1.3 trillion sovereign wealth fund, one of the world’s largest investors, is still unable to divest its holdings in Russia as the custodian bank is under Western sanctions, the Norwegian Finance Ministry said on Friday. The Oslo-based Government Pension Fund is the world’s biggest owner of publicly traded companies with a portfolio of about 9,000 stocks. It has around 0.2% of its assets invested in Russia. “The market for trading in Russian financial instruments is still subject to comprehensive sanctions and has not been normalized as of March 2023,” the ministry said in a statement. The Nordic country’s authorities decided to sell Russian stocks right after the start of the military operation in Ukraine.

The fund held shares in 47 Russian companies and government bonds valued at 25 billion Norwegian crowns ($2.4 billion) at the end of 2021. However, at that time the fund’s management was resisting pressure to shed Russian assets, with CEO Nicolai Tangen saying it would be “a wrapped gift to the oligarchs who buy our shares.” Since then, Western nations have imposed sweeping sanctions against Russia which now prevent the Norwegian pension fund from divesting its assets. “The concrete and practical problem is that the custodian bank that we use is under sanctions, and can’t assist us with settlement of transactions, and neither with voting on shares” in Russian companies, deputy CEO, Trond Grande said in January.

The situation is “deadlocked” he noted, adding that “there is no way we can either sell or buy or vote on these shares.” Details of the fund’s portfolio at the end of 2022 released in January revealed a loss of about $2.8 billion from Russian holdings, compared to their value at the end of 2021. Meanwhile, Russia has repeatedly warned that sanctions imposed on the country would backfire. Earlier this month, Finance Minister Anton Siluanov said Western nations would “suffer from their own restrictions” while being “disappointed” by Russia’s resilience.

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A pretty crazy plan, if you ask me. Do they really think Russia will let armed troops wander around?

‘Peacekeepers’ Deployed To Ukraine Without Russia’s Consent – Medvedev (TASS)

So-called peacekeepers, whose deployment to Ukraine under NATO auspices is currently being mooted in Europe, will be eliminated should any appear at the frontlines without Russia’s consent, Russian Security Council Deputy Chairman Dimity Medvedev said on Friday. “It is obvious that such ‘peacekeepers’ are our unvarnished enemies, wolves in sheep’s clothing. They would be a legitimate target for our armed forces should they be deployed at the frontlines, without Russia’s consent, with weapons in hand and presenting a direct threat to us,” Medvedev wrote on his Telegram channel. According to Medvedev, “those ‘peacekeepers’” must be destroyed mercilessly as they are the “soldiers of the enemy.”

“They will die in the course of combat,” the deputy chairman of the Russian Security Council stated with confidence. “Is Europe prepared for a long line of coffins holding its ‘peacekeepers’?” he asked rhetorically. “Their (NATO member countries’ – TASS) true intentions are crystal clear – to impose a peace that is favorable to them on the line of contact from a position of strength and to station their ‘peacekeeping’ troops in Ukraine, who would be armed with assault rifles and riding on tanks, and would be wearing some sort of blue helmets with yellow stars,” the deputy chairman of the Russian Security Council said.

Medvedev recalled that the potential results of such actions can be seen in the “history of operations conducted by the United States and its allies in various regions of the world, [including] the tragedies of Korea, Vietnam, Yugoslavia, Iraq, Afghanistan and numerous African countries.” “It is clear that the so-called NATO peacekeepers are simply preparing to enter the conflict on the side of our enemies in order to make hay out of this, bringing the situation to the point of no return, and to unleash that World War III they claim to be so afraid of.”.

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“It’s a little early to assess the knock-on effects of the Left’s ecstatic Trumpgasm..”

Did They Light Up a Cigarette Afterward? (Kunstler)

The New York Times enjoyed its long-delayed tantric Trumpgasm so much today that it rolled out the full-page banner headline format usually reserved for the commencement of world wars. (They took the banner down before seven o’clock this morning.) For many of the cat-ladies employed as “reporters” at the once-august paper, it was the first Trumpgasm they’ve ever experienced in a lifetime of emotional displacement, over-eating, and furious knitting of pink polyester hats for the crusade to root out patriarchal wickedness. This fulfillment of a years-long psychodrama, starring the feared and loathed occult persona of a gold-coiffed “Daddy” figure who once presided in the political household, came at the hands of dragon-slayer Manhattan DA Alvin Bragg, archetype of the many long-oppressed victims worked to death in the bilges of our slave ship of state — now turned righteous Woke deliverer of cosmic vengeance!

This, of course, is brought to you by the party of hoaxes, flimflams, and mandated death shots, so it’s amusing here on the sidelines to see The Times’s op-ed writers squirm with post-coital pleasure underneath the full-page Trumpgasmic headline. The lead editorial declares: “Even Donald Trump Should Be Held Accountable”— overlooking the utter absence of accountability that has been the norm in every recent insult to the nation’s dignity from wholesale and repeat election fraud, to six years of lawless depravity in the FBI, to overt support of Antifa and BLM street havoc, to the forced, deceitful administration of deadly “vaccines.” “How a President’s Arrest Can Strengthen a Democracy,” honorary cat-lady Nicholas Kristoff opined, repeating the bad-faith trope that his legions of Wokery have an interest in political rectitude — when, in fact, they are solely preoccupied with coercing, censoring, cancelling, persecuting, punishing, and defenestrating anyone who objects to their grifts and hustles.

“Only love and a leap of faith can break through distrust. That is why a credible form of patriotism is so important right now,” explained The Times’s official Superintendent of Platitudes, David Brooks, to soothe consciences grated by this loutish gambit to shove a political adversary off the game board in advance of an election. “Joe Biden may not be your cup of tea,” Mr. Brooks summed up his civics lesson, “but he’s restored sanity, effectiveness and decency to the White House.” [..] It’s a little early to assess the knock-on effects of the Left’s ecstatic Trumpgasm. A common theme flying across the Web is that Alvin Bragg’s jerry-rigged case will only make a martyr of Mr. Trump, neatly illustrating and personifying the government’s apparent war against its own citizens — making it clear that they will stop at nothing and no one to enforce the corrupt bureaucracy’s will against the public — and that the net result will be to ensure Mr. Trump’s reelection in 2024.

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There are tons of Trump-haters in positions of power. A new one very day.

Manhattan Assistant DA Nukes Twitter Account After Anti-Trump Bias Exposed (ZH)

Less than 24 hours after the Gateway Pundit exposed Manhattan Assistant District Attorney Meg Reiss’ public hatred of Donald Trump on Twitter, Reiss – who’s been accused of masterminding the case against the former president, locked and then deleted her account. As TGP documented Thursday morning, Reiss ‘liked’ several anti-Trump tweets, exposing her absolute bias against the man her office is about to indict over hush money paid to former adult actress Stormy Daniels (real name Stephanie Clifford). Of note, Trump’s alleged payment to Daniels through former lawyer Michael Cohen would normally be a misdemeanor which falls outside the statute of limitations. Not for Bragg’s office. Not for Reiss. For comparison, Hillary Clinton was allowed to pay a fine to the FEC for actual election interference with the Steele Dossier hoax her campaign paid for and then boosted throughout the media.


As TGP further notes; The Institute for Innovation in Prosecution (IIP) which is a research center out of the Soros-funded John Jay College has tagged her dozens of times. Reiss served as the Executive Director for the IIP.” DA of Brooklyn Eric Gonzalez also tagged Reiss, who previously served in the Brooklyn District Attorney’s Office as the Chief of Social Justice, on several occasions too. Most of these tweets Reiss liked were while she served in the Brooklyn District Attorney’s Office as the Chief of Social Justice and as she served as the director of the IIP. However, her political bias extends into her time at the Manhattan DA’s office as well. Earlier in the year as she was serving as Manhattan’s Chief Assistant District Attorney she retweeted a video of Democrat representative Hakeem Jeffries giving a speech at the State of the Union. At one point during the video Reiss shared, Rep. Jeffries says Democrats will put “Maturity over Mar-a-Lago”.

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“Bragg ran on his pledge to bag Trump and Pomerantz ramped up the political base to demand an indictment for a crime. It really did not matter what that crime might be.”

The Trump Indictment: Making History in the Worst Possible Way (Turley)

Manhattan District Attorney Alvin Bragg has finally made history. He has indicted former President Donald Trump as part of an investigation, possibly for hush money payments. We are all waiting to see the text of the indictment to confirm the basis for this unprecedented act. But history in this case — and in this country — is not on Bragg’s side. The only crime that has been discussed in this case is an unprecedented attempt to revive a misdemeanor for falsifying business documents that expired years ago. If that is still the basis of Thursday’s indictment, Bragg could not have raised a weaker basis to prosecute a former president. If reports are accurate, he may attempt to “bootstrap” the misdemeanor into a felony (and longer statute of limitations) by alleging an effort to evade federal election charges.

While Trump will be the first former president indicted, he will not be the last if that is the standard for prosecution. It is still hard to believe that Bragg would primarily proceed on such a basis. There have been no other crimes discussed over months, but we will have to wait to read the indictment to confirm the grounds. What we do know is the checkered history leading to this moment. The Justice Department itself declined to prosecute the federal election claim against Trump. There was ample reason to decline. The Justice Department went down this road before and it did not go well. They tried to prosecute former Democratic presidential candidate John Edwards on stronger grounds (which I also criticized) and failed. In that case, campaign officials and donors were directly involved in covering up an affair that produced a child.

At the time, Edwards’ wife was suffering from cancer. The prosecution still collapsed. The reason is that you need to show the sole purpose for paying hush money in such a scandal. For any married man, let alone a celebrity, there are various reasons to want to bury a sexual scandal. For Trump, there was an upcoming election but he was also married man allegedly involved in an affair with a porn star. He was also a television celebrity who is subject to the standard “morals clause” that’s triggered by criminal conduct or conduct that brings “public disrepute, scandal, or embarrassment.” These clauses are written broadly to protect the news organizations and their “brand.”

Various presidents from Warren Harding to Bill Clinton have been involved in efforts to hush up affairs. They also had different reasons for burying such scandals, including politics. However, scandals are messy matters with a complex set of motivations. Showing that Trump only acted with the future election in mind — rather than his current marriage or television contracts — is implausible. That was likely the same calculus made by the Justice Department. That is also why the use of the “bootstrapping” theory as the primary charge would be an indictment of the prosecution and its own conduct. The office has already been tarnished by the conduct of the prosecutors who pushed this theory.

When Bragg initially balked at this theory and stopped the investigation, two prosecutors, Carey R. Dunne and Mark F. Pomerantz, then resigned from the Manhattan DA’s office. Pomerantz then did something that some of us view as a highly unprofessional and improper act. He published a book on the case against Trump — a person who was still under investigation and not charged, let alone convicted, of any crime. It worked. Bragg ran on his pledge to bag Trump and Pomerantz ramped up the political base to demand an indictment for a crime. It really did not matter what that crime might be.

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Save the world by destroying society. Sounds like a plan.

Stirrings of Euro Eco-rebellion (Higgie)

It’s not often that a development in north-western Tasmania looms large on the international stage. But a site near Burnie is set to be a key part of Germany’s resistance to Green pressure to abandon internal combustion engine (ICE) vehicles in favour of electric cars. Porsche is the driving force behind the A$1 billion investment in the HIF (Highly Innovative Fuels) plant now in development – one of three such e-fuel plants globally – as part of a move to mass production by 2026. E-fuel, not yet commercially available, is a combination of hydrogen with carbon dioxide captured from the atmosphere which ICE vehicles can run on. While the use of e-fuel produces carbon emissions, these are offset according to producers by the CO2 sucked from the atmosphere to make the fuel. Germany’s car producers are touting ICE vehicles using e-fuel – with the price eventually expected to be around A$2 a litre – as an alternative to battery-powered cars.

Germany’s insistence that ICE vehicles can and must remain into the future has shown that even for its Green-Left government, economics can eventually trump environmental political correctness. The country remains by far Europe’s largest car producer and is the world’s largest car exporter by value, employing 800,000, 5 per cent of the workforce. Car production has in large part powered Germany’s modern economy and more than a little Teutonic pride is inspired by the fact that one of their own, Karl Benz, pioneered the first reliable petrol engine and commercial production of ICE vehicles. Torpedoing the EU plan to ban the sale of new ICE vehicles will allow car producers to continue using their existing products and infrastructure.

Germany’s position has thrown a spanner in the works of what the EU had proclaimed as a landmark step in its climate change activism. Chancellor Olaf Scholz’s government last year signed off on an EU commitment for all new vehicles sold from 2035 to have zero emissions. In February the European parliament, including representives of Germany’s coalition parties, passed legislation to that effect. To be confirmed as EU law, the measure needs to be approved by the European Council, the EU member-state leaders. But at the eleventh hour, the one non-Green-Left element in Germany’s ruling coalition, the pro-business Free Democrats (FDP), began echoing through its Porsche-driving transport minister, Volker Wissing, fierce objections of the country’s car producers to an all-electric vehicle future. The FDP has long been a strong backer of the car industry, including through its resistance to efforts by the other main parties to end Germany’s status as Europe’s only country without a general motorway speed limit. Despite objections from the Greens, Scholz has backed the FDP’s objections to the EU’s planned 2035 law.

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Latest photo of Julian Assange. Now I want to cry.

 

 


Oliver Hardy, Stan Laurel, Jimmy Durante and Buster Keaton in 1932.

 

 

Gervais
https://twitter.com/i/status/1641683221153972226

 

 

Burnt tree
https://twitter.com/i/status/1641750060965715969

 

 

 

 

Support the Automatic Earth in virustime with Paypal, Bitcoin and Patreon.

 

 

 

 

 

Feb 132018
 


Camille Corot Study for “The Destruction of Sodom” 1843

 

We Are Sitting On A “Full Tank Of Gas” (Roberts)
‘Whistleblower’ Alleges VIX Manipulation, Urges Regulatory Probe (R.)
How A 5% Mortgage Rate Would Roil The US Housing Market (CNBC)
Interest-Only Loan Cash Flow Crunch Sparks Fears Of Fire Sales (AFR)
These Bonds Should Make ECB Hawks Apoplectic With Rage (BBG)
China Real Estate Under Pressure (BBG)
Greece Rocked By Claims Drug Giant Novartis Bribed Former Leaders (G.)
Greece Is a Turkey, and the Market’s Going to the Dogs (BBG)
An Englishman’s Home Is an Unreliable Pension Plan (BW)
Charities Face Crackdown On ‘Horrific’ Culture Of Sexual Exploitation (Ind.)
Unicef Admits Failings With Child Victims Of Sex Abuse By Peacekeepers (G.)

 

 

“Individuals just simply refuse to act “rationally” by holding their investments as they watch losses mount.”

We Are Sitting On A “Full Tank Of Gas” (Roberts)

Yea….it’s that psychology thing. Individuals just simply refuse to act “rationally” by holding their investments as they watch losses mount. This behavioral bias of investors is one of the most serious risks arising from ETFs as the concentration of too much capital in too few places.

But this concentration risk in ETF’s is not the first time this has occurred: In the early 70’s it was the “Nifty Fifty” stocks, Then Mexican and Argentine bonds a few years after that; “Portfolio Insurance” was the “thing” in the mid -80’s; Dot.com anything was a great investment in 1999; Real estate has been a boom/bust cycle roughly every other decade, but 2006 was a doozy; Today, it’s ETF’s and Bitcoin.

Risk concentration always seems rational at the beginning, and the initial successes of the trends it creates can be self-reinforcing. Until it goes in the other direction. While the sell-off last week was not particularly unusual, it was the uniformity of the price moves which revealed the fallacy “passive investing” as investors headed for the door all at the same time. Such a uniform sell-off is indicative of what we have been warning about for the last several months. For price chasing investors, last week’s plunge should serve as a warning. “With everyone crowded into the ‘ETF Theater,’ the ‘exit’ problem should be of serious concern. Unfortunately, for most investors, they are likely stuck at the very back of the theater.

I warned of this previously: “At some point, that reversion process will take hold. It is then investor ‘psychology’ will collide with ‘margin debt’ and ETF liquidity. It will be the equivalent of striking a match, lighting a stick of dynamite and throwing it into a tanker full of gasoline. When the ‘herding’ into ETF’s begins to reverse, it will not be a slow and methodical process but rather a stampede with little regard to price, valuation or fundamental measures. Importantly, as prices decline it will trigger margin calls which will induce more indiscriminate selling. The forced redemption cycle will cause catastrophic spreads between the current bid and ask pricing for ETF’s.

As investors are forced to dump positions to meet margin calls, the lack of buyers will form a vacuum causing rapid price declines which leave investors helpless on the sidelines watching years of capital appreciation vanish in moments. Don’t believe me? It happened in 2008 as the ‘Lehman Moment’ left investors helpless watching the crash.” “Over a 3-week span, investors lost 29% of their capital and 44% over the entire 3-month period. This is what happens during a margin liquidation event. It is fast, furious and without remorse.” Make no mistake we are sitting on a “full tank of gas.”

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No! “The flaw allows trading firms with advanced algorithms to move the VIX up or down by simply posting quotes on S&P options..”

‘Whistleblower’ Alleges VIX Manipulation, Urges Regulatory Probe (R.)

A scheme to manipulate Wall Street’s fear gauge, VIX, poses risk to the entire equity market and costs investors hundreds of millions of dollars a month, a law firm on behalf of an “anonymous whistleblower” told U.S. financial regulators and urged them to investigate before additional losses are suffered. The Washington-based law firm which represents an anonymous person who claims to have held senior roles in the investment business, told the Securities and Exchange Commission and Commodity Futures Trading Commission on Monday that he discovered a market manipulation scheme that takes advantage of a widespread flaw in the Chicago Board Options Exchange (CBOE) Volatility Index (VIX).

The CBOE Volatility Index measures the cost of buying options and is the most widely followed barometer of expected near-term stock market volatility. “The flaw allows trading firms with advanced algorithms to move the VIX up or down by simply posting quotes on S&P options and without needing to physically engage in any trading or deploying any capital,” it said in a letter. Those bets against volatility unraveled last week as the benchmark S&P 500 and the Dow Jones Industrial Average suffered their biggest respective percentage drops since August 2011. Investors using exchange-traded products linked to the VIX were pummeled and two banks, Credit Suisse and Nomura, said they would terminate two exchange traded notes that bet on low volatility in stock prices.

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Try 6%, 7%.

How A 5% Mortgage Rate Would Roil The US Housing Market (CNBC)

Mortgage rates are now at their highest level in four years and poised to move even higher. The timing couldn’t be worse, as the usually busy spring housing market kicked into gear early this year amid higher home prices and strong competition for a record low supply of homes for sale. Add it all up, and affordability is starting to hurt. The average rate on the popular 30-year fixed is now right around 4.50%, still low when looking historically, but buyers over the past six years have gotten more used to rates in the 3% range. Mortgage rates have not been at 5% since 2011. A 5% rate would cause more than a quarter of today’s homebuyers to slow their plans, according to a Redfin survey of 4,000 consumers at the end of last year. Just 6% said they would drop their plans to buy altogether.

About one-fifth of consumers said 5% rates would cause them to move with more urgency to purchase a home, fearing rates would rise even further. Another fifth said they would consider more affordable areas or just buy a smaller home. Despite rate concerns, the bigger issue for buyers is changes to tax laws that had lowered the cost of homeownership. Specifically, the deduction on property taxes is now limited to $10,000. While that does not affect homeowners in the majority of the country, it does hit those in high-cost states like New York, New Jersey and Illinois, and those in higher-priced housing markets like California. Some have claimed that higher rates and the new tax law will put downward pressure on home prices, alleviating some of the current sticker shock, but other factors are fighting that assertion.

“Tight credit, lack of inventory and high demand are the major factors that tell us there’s no housing bubble, despite rapid price increases,” said Redfin’s chief economist, Nela Richardson. “There are still many more buyers than the current housing supply can support, with no major relief in sight.”

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From Australia. Check interest-only where you live. Big Threat.

Interest-Only Loan Cash Flow Crunch Sparks Fears Of Fire Sales (AFR)

Interest-only property investors seeking to switch their loan to principal and interest may be forced to sell because of lenders’ tough new serviceability requirements. A typical borrower paying 4.5% on a $400,000 loan will have to prove to their lender they can meet repayments for a 7.25% loan, or an increase in annual repayments from $18,000 to more than $32,700. The higher serviceability rates have been introduced after many investors took out their loans and are forcing borrowers to try and sell their properties, despite markets beginning to soften. It’s worse for many self-managed super fund investors who bought investment properties and are boxed in from making bigger payments because of annual caps on the size of their contributions. Real estate agents are warning the cash flow crunch is causing mortgage stress to rapidly spread from one-time mining boom towns and the outer suburbs into prestigious inner suburbs.

“Clients are ringing to say they need to refinance and their next call is that they need to sell,” said Andrew Fawell, director of Beller Property Group. Mr Fawell, whose business covers inner Melbourne within 10 kilometres of the central business district, has been asked to value four potential mortgagee property sales in the past month after having none in the past two years. “Many investors who bought two or three apartments with, in many cases, only 10% deposit with cheap interest-only loans are beginning to feel the heat,” Mr Fawell said. “These numbers will get a lot worse as investors find it harder to service their debt.”

The potential problem arises for many three- to five-year fixed rate loans that have reached the end of their terms and the much stricter regime introduced by the Australian Prudential Regulation Authority. Many borrowers deposited only 10%. In recent years most major lenders have introduced a 7.25% “floor for serviceability” for investor and owner-occupier loans, which is the minimum rate at which the bank will assess a home loan. Serviceability is the lenders’ assessment of the borrowers’ capacity to afford the loan and takes into account possibly higher future interest rates. It is usually assessed by a review of income and fixed commitments over the life of the loan and potential rental income.

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The ECB supports those parties that don’t need it.

These Bonds Should Make ECB Hawks Apoplectic With Rage (BBG)

This is tapering? With the economic recovery well under way in Europe the European Central Bank has cut its government bond purchases by two-thirds. Fair enough. However, it is not reining in its involvement in company debt. The securities now comprise about 20% of monthly purchases, up from 7% at the start of the program in mid-2016. The total amount could top €200 billion ($244 billion) before quantitative easing ends. If it had any self-knowledge the ECB should be aware of the problems it’s creating. The fact that, by its purchases, it has soaked up all the liquidity in the secondary market and has had to turn to the primary market should be a warning sign. The central bank’s growing involvement in company borrowing should be causing ructions among the hawks on the Governing Council, who seem alive to the dangers of being late in withdrawing stimulus.

Yet their silence is deafening. Through QE the ECB has invested in over 230 individual companies, and with an average maturity of 5.6 years it’s impossible to see them as being exposed only in the short term. Performance has been decent – spreads have tightened on about three-quarters of its holdings. The odd misstep, such as having to liquidate Steinhoff or German fertilizer maker K+S bonds when they fell below investment grade, can be overlooked. The knock-on effect of such largess is that corporate bond spreads have had a seemingly unending streak of achieving record lows. Support for credit markets in times of strife is one thing. But driving outsized performance isn’t just storing up trouble for an individual company or investor for the future, it’s a reckless refusal to allow financial discipline to inform the decision making of actors in the financial system.

[..] The surge of demand for additional tier one bank capital is another particularly worrying phenomenon. Investors face a total loss if the issuing bank’s capital ratios fall below regulatory requirements. Raiffeisen Bank was able in January to issue an AT1 perpetual bond at 4.5%, having issued a similar 6.125% AT1 security in June. Though there was a one-notch credit-rating upgrade, that can hardly justify such an enormous improvement. And 4.5% can never be enough compensation for the risk of getting completely wiped out.

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Now Beijing wants to push rental housing. Easier to control?

China Real Estate Under Pressure (BBG)

While all eyes are on China’s stocks rout after the U.S. swoon, there’s a troubled sector that’s garnering fewer headlines but will have broader reverberations – real estate. Chinese property stocks slumped last week, dragged down not just by the global sell-off but by worries this may be the year when housing finally takes a hit. To date, Beijing’s crackdown on risk amid soaring household debt has had little effect on prices. December data showed values in small cities continued to rise, while they were mostly flat in top-tier conurbations like Guangzhou, Shenzhen and Beijing. There are several reasons, though, why the 13-year rally in house prices must end at some point. First, banks are making borrowing tough, not only raising costs for home loans but also restricting supply, especially in major centers such as Beijing and Shenzhen, under a semi-official mortgage quota.

Even last year’s stars, the second- and third-tier cities that led price gains, may fade as China curtails easy home loans that were intended to help soak up a glut of property. Downpayments there ranged between 20 and 30%, compared with 40 to 80% in top-tier locations, according to Credit Suisse. As the curbs bite, mortgage lending has started to decline. (The other plank of household debt, consumer lending, has been an even bigger problem, surging 180% last year, according to Credit Suisse.) Second, perhaps further down the line, a property tax is looming. Finance Minister Xiao Jie indicated this might happen as early as 2020. When President Xi Jinping exhorted people to remember that houses are for living, not speculation, real estate investors must have grown nervous; a tax will make them quake.

With few investment options available to individuals beyond the volatile stock market and wealth-management products (more and more of which are being banned), it’s no surprise that as much as 25% of the demand for real estate is speculative, according to Bloomberg Economics. Third, there’s the more immediate threat to real estate prices of a supply-side push by Beijing. The government is starting to shift from tamping down demand to promoting new housing. Among measures the government is promoting, according to BNP Paribas economist Chen Xingdong, is encouraging homes where the government and buyers share property rights, and even allowing state-owned firms to sell apartments to their employees. The government is also encouraging the growth of a rental market. While much of the current stock of rental housing is of poor quality, that’s likely to change.

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And only now does this reach European media. The upshot: Novartis pulled the same stunt in South Korea.

Greece Rocked By Claims Drug Giant Novartis Bribed Former Leaders (G.)

The Greek prime minister, Alexis Tsipras, has called for parliament to investigate whether two of his predecessors and eight former ministers accepted bribes from the Swiss drugmaker Novartis, after allegations of industrial-scale bribery involving senior politicians. The former PMs Antonis Samaras and Panagiotis Pikrammenos, the governor of the Bank of Greece and the EU’s migration commissioner were all identified as alleged beneficiaries of bribes in a report compiled by anti-corruption prosecutors with the help of US authorities. Novartis is alleged to have bribed politicians to approve overpriced contracts and to have made payments to thousands of doctors as part of concerted efforts to boost sales between 2006 to 2015.

The claims have rocked Greek society since coming to light last week. One serving government minister claimed the kickbacks surpassed €50m and resulted in costs of more than €4bn to the Greek public health system. The deputy justice minister, Dimitris Papangelopoulos, said it was “the biggest scandal since the establishment of the Greek state” almost 200 years ago. Widening the net on Monday, Tsipras said it was imperative there could be no cover-up. “We will make use of every power afforded by national and international law to recover the money stolen from the Greek people down to the last euro,” the leftist leader told MPs in his Syriza party. “We will do everything we can to reveal the truth.”

MPs will vote on establishing a committee of inquiry later this month. Only parliament has the power to investigate politicians for alleged infractions during their term in office. The allegations have been rebutted vehemently by the accused. The report’s reliance on three unnamed witnesses – who are currently under government protection – has been especially criticised, and legal experts contend that the claims would not stand up in court. The EU commissioner Dimitris Avramopoulos demanded that the identity of the witnesses be revealed and expressed his “disgust” at what he said were fabrications created by “sick minds”. He stands accused of purchasing 16m anti-flu vaccines from Novartis while health minister between 2006 and 2009. [..] Novartis has faced similar investigations in recent years. Last year South Korea fined the company $48m for offering kickbacks to doctors.

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Just as Greece starts selling bonds again, it faces increasing competition,

Greece Is a Turkey, and the Market’s Going to the Dogs (BBG)

Greece almost makes it look easy. It issued a new €3 billion ($3.7 billion) seven-year bond on Thursday, at a very healthy 3.5% yield, stepping into a briefly open window for raising money during the most torrid week for markets in years. The security is now trading very close to 4%. Ouch. The benefits of going ahead with the sale went to Greece rather than to investors. With a €6 billion order book there was no lack of demand – but there is buyer’s remorse now. It’s the first sovereign syndicated new issue to perform badly in Europe so far this year. This could make it troublesome for the region’s other governments to bring deals on top of an already-heavy regular auction schedule. Greece may just be one turkey, but investor demand is going to become a lot pickier.

And there’s plenty to choose from. Governments have been crowding out the syndicated new issue market even more this year, comprising 26.5% of deals versus an already-strong 23% at this stage in 2017. If supra-nationals and agencies are included then half of all new syndicated deals are from an official institution. It’s a curious result, given that the European new-issue market is supposed to be much more about companies. For example, the European Financial Stability Facility – created to fund Greece’s bailout – has already issued half of its €28 billion annual plan. The EFSF has come three times in 2018 with €13.5 billion in maturities ranging from 6 to 23 years. That is an almost indecent rush to complete its annual funding schedule as early as possible. It’s smart for the issuer – less so for the investor.

Borrowers can try to front-load sales in a low-rate environment, but with more central banks getting comfortable with tightening, investors are not going to play that game unless the yield is generous. It’s an increasing struggle, given that the German benchmark 10-year yield has risen sharply since the mid-December lows of 30 basis points. The yield famine is easing up.

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What a shame: too late!

An Englishman’s Home Is an Unreliable Pension Plan (BW)

“A man’s house is his castle,” Sir Edward Coke wrote back in the 17th century. These days, Britons are relying on their properties not just for refuge but also to fund their retirements. It’s a strategy that could backfire badly. Along with the rest of the world, the U.K. has an aging population: a growing number of retirees are being supported by a shrinking pool of workers. The U.K.’s dependency ratio – calculated by adding together the over 65s and under 15s, then dividing by the working-age population and multiplying by 100 – will rise to 60% by 2027. That’s up from 55% in 2017 and from 54% in 1997. As the pyramid grows more inverted, how does the top-heavy non-working cohort propose to finance a life of leisure and superannuation? By releasing the equity they expect to have accumulated in their homes once they’re ready to hit the golf course.

One in five Brits agreed with the statement “when I retire, I plan to sell my house, downsize and live off the profit,” according to a survey commissioned by pension consultants LCP from polling firm YouGov. That gamble seems unwise. In recent years home values, like global stock markets, only ever seemed to increase. But, again as with global stock markets, the notion of ever-rising prices has taken something of a beating recently. According to a report published on Monday, U.K. house prices posted their first annual decline in six years in January. Moreover, with wage growth in recent years failing to keep pace with either rising property prices or inflation, it’s become harder for those of working age to get on the housing ladder in the first place. And the percentage of under 34s who own their own homes has slumped in the past decade.

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This is so sick it makes one silent.

Charities Face Crackdown On ‘Horrific’ Culture Of Sexual Exploitation (Ind.)

British charities are facing a government crackdown to combat the “horrific” sexual exploitation exposed at Oxfam, amid concerns about a wider culture of abuse. All British charities working overseas have been ordered to provide “absolute assurances” that they are protecting vulnerable people and referring complaints to authorities. Oxfam’s deputy chief executive resigned during crisis talks with the Government, saying she took “full responsibility” for the alleged use of prostitutes by senior staff in Haiti. But aid workers told The Independent sexual misconduct against both locals and staff remains “widespread” in humanitarian agencies and called for wholesale reforms.

Penny Mordaunt, the International Development Secretary, has written a letter to all UK charities working overseas demanding “absolute assurance that the moral leadership, the systems, the culture and the transparency needed to fully protect vulnerable people are in place”. “It is not only Oxfam that must improve,” she said. “My absolute priority is to keep the world’s poorest and most vulnerable people safe from harm. In the 21st century, it is utterly despicable that sexual exploitation and abuse continues to exist in the aid sector.” The Department for International Development (Dfid) has created a new unit dedicated to reviewing safeguarding in the aid sector and stopping “criminal and predatory individuals” being employed by other charities.

[..] “Oxfam made a full and unqualified apology – to me, and to the people of Britain and Haiti – for the appalling behaviour of some of their staff in Haiti in 2011, and for the wider failings of their organisation’s response to it,” said Ms Mordaunt. “They spoke of the deep sense of disgrace and shame that they and their organisation feel about what has happened, and set out the actions they will now take to put things right and prevent such horrific abuses happening in future.“

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It’s not just Oxfam, it’s an industry-wide culture.

Unicef Admits Failings With Child Victims Of Sex Abuse By Peacekeepers (G.)

The UN’s children’s agency has admitted shortcomings in its humanitarian support to children who allege that they were raped and sexually abused by French peacekeepers in Central African Republic. A statement by Unicef Netherlands is the first public acknowledgement of the agency’s recent failure to provide support to some of the victims of alleged abuse by peacekeepers in the African nation. It comes as the aid sector and the UN face increasing scrutiny for their failings in managing internal sexual misconduct by their own staff. Unicef was given the task of overseeing the support for children who said they had been abused by peacekeepers.

But in March last year, an award-winning investigation by Swedish Television’s Uppdrag Granskning (Mission Investigate) revealed that some of the children supposedly in the UN’s care were homeless, out of school and forced to make a living on the streets, despite UN assurances that they would be protected. Unicef’s representative in CAR told the programme that the children were in the agency’s assistance programme for minors and were being supported. He said he was not aware that some were on the streets. But earlier this month – ahead of a Dutch screening of the programme – Unicef Netherlands admitted to the Dutch television programme Zembla that Unicef had failed in its duty to help some of the alleged victims. But it said that since the programme had first aired, it had taken steps to locate the children featured in the programme and provide them with support.

Marieke van Santen, of Zembla, said she found the Swedish film “astonishing” because the children who were interviewed were known to Unicef, yet they were not being cared for. Van Santen said: “It is quite shocking to realise that not only once but twice UN agencies have failed to help these victims.” The statement from Unicef Netherlands was welcomed by Karin Mattisson, a reporter for Mission Investigate. “I hope it makes a difference to the children and gives them strength. They have said they were failed,” said Mattisson.Several boys who testified to having been sexually assaulted by French soldiers were living rough, Mattisson found, while a girl, who became pregnant at the age of 14 by a Congolese peacekeeper and had later found out she was HIV-positive, was out of school looking after her baby. Another boy, aged eight, who was too traumatised to be interviewed, was in an orphanage. “I hope they live up to this statement,” she said. “When we investigated the UN and Unicef it was a long journey into their culture of silence.”

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