Источник
Zero Hedge
24 мая, 14:15

ECB Warns Of "Excessive Exuberance" In House Prices; Sees Financial Instability Due To Higher Yields

  • 0

In an unexpected two-part warning from the ECB, the European Central Bank warned of “excessive exuberance” in some European housing markets, driven by offshore buyers, that could spread to other areas in a “ripple effect.” Separately, the ECB also said "debt-sustainability concerns" have risen in the past six months amid a potential increase in yields and political uncertainty in some countries. We start with the latter warning, which we find ironic as it is a function of the ECB's own policies of keeping rates suppressed at record lows to promote inflation, and now that inflation has finally emerged, the ECB is worried about the spillover and unwind of its policies. "Risks to financial stability stemming from financial markets remain significant,” the ECB said in its Financial Stability Review. An abrupt bond-market repricing could “materialize via spillovers from higher yields in advanced economies, in particular the United States.” The ECB also warned that euro-area banks remain vulnerable as low interest rates and a big stock of non-performing loans in some regions challenge profitability. It cited structural challenges in the industry, including overcapacity and too little income diversification. In Italy, which has one of the euro region’s highest debt ratios and where the government is trying to finalize a plan to rescue Banca Monte dei Paschi di Siena SpA, business lobby Confindustria said on Wednesday that the country must “be ready for when the ECB will end sovereign bond purchases” according to Bloomberg. This means “quickly lowering the mountain of public debt through privatizations and sale of state-owned real estate,” Chairman Vincenzo Boccia said in Rome. While it did not show it, the chart below from Goldman summarizes the threat: a normalization of European rates would result in double digit principal losses for bondholders in countries like German, Spain, France and Italy... but not if they sell first to other "greater fools." It is this transition from a stable to a chaotic market, that is currently troubling the central bank. Two steps ahead of the ECB, the Fed has already raised rates twice since late last year and policy makers predict two more hikes in 2017. In Europe, an exit from unconventional stimulus is also moving closer, even though officials caution that quantitative easing must be unwound very gradually before higher borrowing costs should even be discussed. As it has done repeatedly in recent months, the ECB report also warned that Brexit “contributes to prevailing political uncertainties,” but said the impact on financial stability should be limited as long as banks take proper action in time. It sees a low risk of the euro-area economy facing restrictions in accessing financial services after Britain’s departure from the European Union. “Well-managed preparations will be essential as a relocation of financial services capacity during the transition from the current situation to the new equilibrium could, in some cases, face frictions,” according to the report. “Therefore, the ECB underlines the need for the concerned banks and other financial institutions to undertake all the necessary preparations in a timely manner.” * * * Separately, in a warning that resident of Vancouver and Toronto will appreciate, the central bank also cautioned that since 2010, house prices in European capital cities have risen far more than national averages. The ECB cited Berlin, Paris, Vienna and Amsterdam as cities that have performed particularly well. While it did not use the words irrational exuberance, it came close, when the ECB said that “exuberant house price developments in certain regions could, in principle, threaten the stability of financial institutions with mortgage exposures concentrated in those regions." Although diverging developments at the regional level could be justified by fundamentals, such as differences in regional income, employment, population dynamics and amenities, they could also signal excessive exuberance of house prices in certain areas, for example due to the strong presence of foreign buyers While hardly rocket science, Bloomberg points out that record-low interest rates have fueled demand for residential properties as investors seek to buy assets that generate returns rather than depositing their money in banks. That has benefited housing markets in Germany, France and the Netherlands, as well as Estonia and Ireland, the ECB said. Compounding the problem, the central bank warned that elevated levels of household indebtedness and large real estate exposures of banks in countries such as Finland and the Netherlands could  “amplify” shocks. The central bank said it’s monitoring property-market developments closely and may top up national measures if necessary. To which all we can say is that we wish the ECB, which created all the problems it now complains about, the best of luck as it scrambles to contain the genie inside the bottle.

24 мая, 13:44

China Downgrade Forgotten As Asia Closes Higher, Futures Flat Ahead Of Fed Minutes

  • 0

Not even last night's Moody's credit downgrade of China - the first since 1989 - could dent the global stock rally which has pushed global stock prices to all time highs. After initially sliding, regional stocks and emerging Asian currencies pared early losses following the unexpected downgrade of China, taking their cue from the "sudden reversal" of the Shanghai Composite Index, which some speculated saw the latest intervention of the "national team." Moody’s action on China briefly rattled Asian markets, but against a backdrop of strengthening global growth and the impending release of minutes from the Federal Reserve’s latest meeting, investors appeared to quickly move on. MSCI's broadest index of Asia-Pacific shares outside Japan was unchanged while Japan's Nikkei stock index ended 0.7 percent higher. The Shanghai Composite gained 0.1% at the close, reversing an early decline of 1%, while the offshore yuan inched up. As reported last night, the major overnight catalyst in Asia was Moody's downgrade of China’s credit rating to A1 from Aa3 in early Asia trading, citing a worsening outlook for the nation’s financial strength - in the end of the Chinese session it had little impact, aside from another steep selloff in iron ore, which traded nearly limit down. The downgrade impact on regional currencies was likewise limited as Asia’s economic growth is seen to be improving and there are still positive stories such as S&P’s upgrade of Indonesia’s rating last week. By the end of the session, nobody even remembered China had been downgraded: the Shanghai Composite rose 0.1 percent, reversing a drop of 1.3 percent. The Hang Seng also ended higher after an earlier decline of 0.4 percent. Japan’s Topix index climbed 0.6 percent, while Indonesia’s benchmark index slumped 0.7 percent. The Australian dollar slipped 0.1 percent, paring a steeper drop of as much as 0.5 percent. Away from Asia, European stocks rose and U.S. equity futures and the dollar both steadied. The Stoxx Europe 600 Index climbed a second day, but struggled to gain momentum as miners slumped after China's downgrade. That triggered declines across copper, nickel, zinc and iron ore. The British pound strengthened after two days of losses, even as Prime Minister Theresa May warned that further terrorist attacks could be imminent. "There's been a cautious start in Europe this morning with stocks in the red following a downgrade in the Chinese credit rating from Moody's," said David Cheetham, chief market analyst at brokerage XTB. "After being very much at the front and center of global risk sentiment at the beginning of last year, the Chinese slowdown story has been almost forgotten, with politics throughout Europe and the U.S. taking the limelight." S&P500 futures were little changed as investors awaited economic data and earnings reports, while volatility dropped for a fifth day. S&P 500 contracts expiring in June added less than 0.1% to 2,398.5 at 6:30 a.m. in New York. Crude extended gains a sixth day as OPEC prepared for Thursday’s key meeting in Vienna, and where an announcement of a 9 month productin cut extension now is fully priced in. In currencies, the dollar was little changed against most of its peers and Treasury yields were steady before the U.S. Federal Reserve releases later Wednesday the minutes of its May 3 policy meeting. With Fed due to release its May meeting minutes, “markets are ready to catch any clue regarding the likelihood of an interest- rate hike at the FOMC’s June meeting,” writes Ipek Ozkardeskaya, senior analyst at London Capital Group. Fed Bank of Philadelphia President Patrick Harker said June “is a distinct possibility” for the U.S. central bank’s second interest-rate increase of 2017. While equities quickly forgot the downgrade of China, the world's top user of materials, industrial metals were far more bruised, as nickel slumped 1.9% and copper fell 0.6%. Iron ore futures dropped 4.7%.  West Texas oil rose 0.2 percent to $51.56 a barrel, adding to a five-day advance ahead of tomorrow's OPEC meeting. old added 0.1 percent to $1,252.30 an ounce, after dropping 0.8 percent on Tuesday. Elsewhere the Australian dollar fell and the yen pared losses against the U.S. currency after Moody’s Investors Service cut its rating on China’s debt for the first time in almost three decades. The euro was little changed ahead of the Fed minutes, even as ECB policy makers warned of the dangers of the ‘ripple effect’ from the house price boom and ‘significant’ bond risks spurring increased debt concerns. In rates, the yield on 10-year Treasury notes fell less than one basis point to 2.27 percent. Bonds fell during the previous four days. Yields on benchmark French, German and British bonds all dropped two basis points. Today investors await the minutes of the U.S. Federal Reserve's latest policy meeting, scheduled to be released at 2pm. Fed funds futures show that traders now see a 75% chance that the U.S. central bank would will raise interest rates at its June meeting. "Our U.S. economists expect the minutes to come down on the hawkish side and continue to expect the Fed to hike in June and September and announce balance sheet reduction in December," Citi analysts wrote on Wednesday. Bulletin Headline Summary from RanSquawk Equities fail to find firm direction and seemingly looking through China's sovereign downgrade as Moody's offers little in the way of any surprises. A very quiet morning in FX with focus on the FOMC minutes, alongside the OPEC/Non-OPEC meeting. Looking ahead, highlights include US Building Permits, Existing Home Sales, DoE Inventories, FOMC Minutes, BoC Rate Decision, ECB's Praet and Draghi Market Snapshot S&P 500 futures little changed at 2,399.25 STOXX Europe 600 up 0.1% to 392.48 MXAP up 0.01% to 151.88 MXAPJ up 0.02% to 495.69 Nikkei up 0.7% to 19,742.98 Topix up 0.6% to 1,575.11 Hang Seng Index up 0.1% to 25,428.50 Shanghai Composite up 0.07% to 3,064.08 Sensex down 0.1% to 30,328.05 Australia S&P/ASX 200 up 0.2% to 5,768.98 Kospi up 0.2% to 2,317.34 German 10Y yield fell 1.1 bps to 0.399% Euro up 0.1% to 1.1197 per US$ Brent Futures up 0.6% to $54.46/bbl Italian 10Y yield fell 1.5 bps to 1.83% Spanish 10Y yield fell 2.2 bps to 1.596% Brent futures up 0.6% to $54.49/bbl Gold spot little changed at $1,251.99 U.S. Dollar Index little changed at 97.30 Top Overnight News from Bloomberg Moody’s Investors Service cut its rating on China’s debt for the first time since 1989, challenging the view that the nation’s leadership will be able to rein in leverage while maintaining the pace of economic growth The European Central Bank said debt- sustainability concerns have risen in the past six months amid a potential increase in yields and political uncertainty in some countries U.K. Prime Minister Theresa May warned that further terrorist attacks could be imminent. The country’s terrorism threat level has been raised to “critical” -- the highest level -- from “severe”, as police hunt for potential accomplices of the suicide bomber who killed 22 people at a Manchester pop concert The White House said Trump’s request for fiscal 2018 would generate a fiscal surplus by 2027 after $3.6 trillion in spending reductions and $2.1 trillion in economic growth-induced revenue increases, but gave no details on how tax cuts would be paid for Traders in the world’s biggest financial market are about to get a new list of do’s and don’ts. The FX Global Code, which the Bank for International Settlements will publish Thursday, aims to stamp out misconduct in foreign-exchange markets after a rigging scandal triggered about $10 billion in fines for banks Glencore-Bunge Deal Would Add G to ABCD Dominating Grain SoftBank Said to Take $4 Billion Stake in U.S. Chipmaker Nvidia Troops Deployed in U.K. After Warning of Imminent Terror Attack Fed’s Harker Calls June Rate Hike a ‘Distinct’ Possibility Oil Holds Gain as Data Show U.S. Supplies Fall Before OPEC Fiat Chrysler Stumbles Into U.S. Regulatory Crosshairs Again Noble Group’s Wild Trading Day Demands ‘High Risk Appetite’ Asia equity markets traded mixed following the mildly positive US close, where indices eked a 4th consecutive daily gain and the S&P 500 briefly advanced above 2,400 to within close proximity of its all-time highs. This provided the initial impetus for the ASX 200 (flat) and Nikkei 225 (+0.3%), while JPY weakness also underpinned Japanese exporter sentiment. Conversely, Shanghai Comp. (+0.1%) and Hang Seng (flat) underperformed after Moody's downgraded China's sovereign credit rating amid expectations of a deterioration in China's financial strength in the upcoming years. 10yr JGBs traded lower on spill-over selling from T-notes and alongside the increased risk sentiment in Japan, although downside was stemmed amid the BoJ's presence in the market for a total JPY 1.03trl in 1yr-10yrs government debt. Moody's downgraded China's sovereign credit rating to Al from AA3; outlook revised to stable from negative. Moody's commented that the rating reflects expectations that China's financial strength will erode somewhat over the approaching years. PBoC injected CNY 40bIn in 7-day reverse repos and CNY 50bIn in 14-day reverse repos. The PBoC set CNY mid-point at 6.8758 (Prey. 6.8661) Top Asian News China State Firms Face Threat of Higher Debt Costs After Moody’s Freeport Says Grasberg Output on Target as Union Extends Strike Evergrande Climbs Most Since July 2015, Leading Gains on HSCI European equities trade with little in the way of firm direction (Eurostoxx 50 flat) as earnings season continues to peter out and markets shrug of overnight news that Moody's downgraded China's sovereign debt rating. Chinese bourses were initially hit on the news given the surprise of the timing but ultimately the action taken is of little surprise given debt concerns and Moody's bringing their rating in-line with that of Fitch and as such European traders have largely looked through the announcement. On a sector stand-point, energy names outperform ahead of this week's OPEC meeting despite a lack of clarity on the duration of any potential extension. Material names underperform amid Dalian ore futures sliding over 5% over night. In fixed income markets, price action has been particularly uneventful with prices stuck in a somewhat narrow range. In peripheral markets, spreads are also relatively unchanged to their core counterparts with markets most likely looking for further direction from today's speech by ECB's Draghi and any further update on the Greek situation after the IMF and German Finance Minister Schauble reportedly struck an agreement on Greek bailout with the IMF willing to participate in the program if Greece proves debt is sustainable. Top European News Morgan Stanley to ‘Significantly Reduce’ Recruiting of Brokers Constancio Says Brexit Won’t Materially Harm Euro-Area Recovery Understanding Poland’s Retreat From Costly Swiss-Loan Fix Wynnstay Shares Slump as Just for Pets Weakness Hits Profit Safran, Zodiac Shares Halted Pending Press Release: Euronext Ikea Names Brodin New CEO to Lead Asia Expansion, Online Growth In currencies, the Bloomberg Dollar Spot Index was flat after climbing 0.3 percent Tuesday. The pound rose 0.1 percent to $1.2971 following a two-day loss. The euro fell by less than 0.1 percent to $1.1178. It has been a very quiet morning in FX and if anything stands out it is the resilience in the cross JPY rates. This is in the face of the Moody's downgrade of China's credit rating, which garnered brief attention in Asia, but little else. USD/JPY has tested 112.00, but good selling interest seen here despite a small tip over the figure level. EUR/USD is still in pullback mode, but fresh demand coming in already. The FOMC minutes ahead may underpin expectations of a Jun move, and this should see USD bids picking up dips — 1.1200 intact as a result. Not that this is deterring Cable buyers still intent on tripping stops through 1.3060-70. We see little other reason for the resilient bid tone in the Pound given what lies ahead, with some suggesting traders are pre-empting a Tory win in the elections. We doubt this would lead to a significant charge higher from current levels, but impulsive markets are here to stay. In commodities, Iron ore led metals lower across the board today as the overnight markets reacted to the Moody's downgrade of China's credit rating. The DCE lost over 4.5% today, with the indices here requiring little to tip the balance these days. Copper has found some resistance at USD2.60 as many anticipated, but the pullback has been tame so far to suggest a more consolidative tone going forward. All eyes on Oil prices at the present time, and with the OPEC meeting not until tomorrow, but ongoing rhetoric supportive of an extension — though to what degree. 6 months is the minimum required to keep WTI above USD50.00, currently trading closer to USD52.00 while Brent is in the upper USD54.00's. Precious metals are out of the spotlight, but Silver has crept back above USD17.00. Looking at today’s calendar, we’ll get the March FHFA house price index reading and also April existing home sales data. This evening we then get the FOMC minutes from the meeting on May 3rd where most be will combing through for discussion on the Fed’s balance sheet strategy. It’s another busy day for Fedspeak today too with Kaplan (6pm ) and Kashkari (6.30pm ) both scheduled. ECB President Draghi also speaks in Madrid at 1.45pm BST. US Event Calendar 7am: MBA Mortgage Applications, prior -4.1% 9am: FHFA House Price Index MoM, est. 0.5%, prior 0.8% 9am: House Price Purchase Index QoQ, prior 1.5% 10am: Existing Home Sales, est. 5.65m, prior 5.71m 10am: Existing Home Sales MoM, est. -1.05%, prior 4.4% 2pm: FOMC Meeting Minutes 6pm: Fed’s Kaplan Speaks in Toronto 6:30pm: Fed’s Kashkari Speaks in Wisconsin DB's Jim Reid concludes the overnight wrap Back in 1990 in an attempt to impress the young ladies on the school bus which we shared with the girls school next door I started watching Twin Peaks. I hated it but had to continue watching in case I could possibly be part of their arty, seemingly sophisticated conversation. They adored it (the show, not my input sadly). So it was some intrigue to me that a new series aired this week 25 years after the last one. I haven't watched it yet but I wonder whether any of it will make sense. For the uninitiated it was a surreal, confusing supernatural drama that amongst other things included a red room where everyone spoke backwards. At 16 this was the height of cool and it was the most popular show of 1990. Thankfully the days of trying to impress a potential new partner are over. What impresses my wife most these days is me changing a nappy so I do that when I can instead. Talking of twin peaks, US equities have again edged up towards the highs after the S&P 500 closed last night within 0.30% of the all time peak from intraday last Tuesday before all the political headlines hit. The index was up +0.18% yesterday which means it has now gained for four consecutive sessions. You’d have to go back to February to find the last time it did that. The Dow (+0.21%) also edged up while there was a similarly positive mood in Europe with the Stoxx 600 (+0.22%) also finishing in positive territory. Some decent PMIs on both sides of the pond seemed to be the catalyst (we’ll come to those shortly) and it didn’t hurt that Oil continues to solidify gains. Indeed WTI (+0.66%) was up for the fifth day in a row yesterday and is holding above $51/bbl ahead of tomorrow’s OPEC meeting where there was more chatter yesterday from energy ministers that a nine-month extension agreement appears likely. In bond markets Treasuries (+2.6bps) and Bunds (+1.3bps) were a little weaker while in currencies the US Dollar (+0.38%) was up for only the second time in the last nine sessions. Needless to say that the tragic events in Manchester dominated the front pages around the world with UK PM Theresa May subsequently raising the terror alert in the UK to ‘critical’ from ‘severe’. Sterling (-0.30%) was a touch weaker yesterday and is holding just below $1.300 this morning. Before we go any further, the main news to report overnight is Moody’s cutting China’s sovereign credit rating by one notch to A1/Stable (was previously on Negative outlook). That is the first time Moody’s have cut China’s rating since 1989. The rating agency noted the likelihood of a “material rise” in economy-wide debt and expectations that China’s financial strength could “erode somewhat” as a result. China’s rating at Moody’s is now level with that of Japan and below other Asia economies of Taiwan and Macau. While there were no real revelations in the Moody’s statement the timing appears to have caught markets by surprise a little. Equity markets in China initially fell sharply on the news and while having pared back some of the losses, are still underperforming this morning. The Shanghai Comp is currently -0.63% and at the lowest level in nearly 8 months. It was initially down as much as -1.28%, while the CSI 300 and Shenzhen are -0.75% and -0.19% respectively. The Hang Seng is now flat after being in the red. Both the onshore (-0.10%) and offshore (-0.05%) renminbi are a shade weaker, while China’s sovereign 5y CDS is 1bp wider. The China sensitive Aussie Dollar is also down -0.40%. Elsewhere in Asia bourses are firmer and seemingly following the lead from Wall Street. The Nikkei (+0.48%), ASX (+0.10%) and Kospi (+0.20%) are all up. Away from markets, there were some interesting comments to come from the ECB’s Benoit Coeure yesterday. Speaking at a conference in Paris, Coeure said that “our current analysis of the secondary effects of negative rates suggest that there is no reason to change the indications we’ve given”. The board member also said that the ECB would start raising rates “well beyond the horizon” of asset purchases. Last week Coeure had said that the future path for rates was “not set in stone”. This suggests that the ECB is not about to change sequencing and is important as Coeure was previously seen as someone who had  suggested a change in sequencing previously. We should get more hints at next month’s ECB meeting. Another focus for the market yesterday was Trump’s budget. Despite the wide acknowledgment that it stands little chance of being passed as proposed it was interesting to look at some of the details still. One questionable aspect is that the plan assumes that US economic growth would reach 3% by 2021 whereas the Fed and Congressional Budget Office project the US economy growing at an annual rate of just 1.8% and 1.9% in the coming years. In addition, the budget assumes to only balance in 10 years through strong growth. This follows the point we made in yesterday’s EMR about the UK not seeing a balanced budget  until 2025 in the Conservative Party’s manifesto. Indeed one wonders how budgets will ever balance again in most countries especially given the demographic headwinds. Staying with the US the White House issued a statement yesterday saying that it does not confirm or deny ‘unsubstantiated claims based on illegal leaks from anonymous individuals’ concerning the investigation of the links between Russia and Trump’s presidential campaign. A reminder that former FBI Director James Comey is likely to testify next week which will no doubt be a talking point for the market. Back to those PMIs yesterday. In Europe the flash May composite for the Euro area came in at a fairly solid 56.8 which was modestly better than what the market was expecting and steady versus the April reading. The manufacturing reading edged up 0.3pts to 57.0 (vs. 56.5 expected) which offset a 0.2pt decline in the services reading to 56.2 (vs. 56.4 expected). In the country details there was a positive read-through in the data for both Germany and France. The former saw its composite rise 0.6pts to 57.3, driven by the manufacturing sector while the latter saw its composite rise 1pt to 57.6, driven by the  services sector. This does however imply a roughly 1.1pt decline in the average composite for the periphery. Taken as whole, the composite reading for the Euro area implies GDP growth in Q2 of +0.8% qoq according to our economists, compared to their forecast of +0.5% qoq. Across the pond, the composite flash May reading in the US came in at 53.9 which was up 0.7pts from April. The details were a little more mixed however with the driver of the increase in the composite coming from the services sector where the PMI rose 0.9pts to 54.0. The manufacturing PMI actually edged down 0.3pts to 52.5. Away from the PMIs, the rest of the data in the US was a tad disappointing. New home sales fell sharply in April (-11.4% mom vs. -1.8% expected) albeit from a March reading which was revised up to an almost 10-year high. Meanwhile the Richmond Fed manufacturing index tumbled 19pts to +1 (vs. +15 expected), confirming some of the weaker data in the factory sector. In Germany Q1 GDP was confirmed as growing +0.6% qoq while the IFO business climate reading in May was revealed as climbing 1.6pts to a better than expected 114.6 (vs. 113.1 expected). The present situation index actually hit a new multi- decade high while the expectations index rose to its highest since February 2014. Finally in the UK the CBI’s distributive trades survey was disappointing with a net 2% of respondents reporting higher sales in May, down from 38% in April. Before we wrap up and look at the day ahead, it’s worth highlighting that German press outlet Handelsblatt was running a story yesterday suggesting that the IMF and German Finance Minister Wolfgang Schaeuble have reportedly reached an agreement on Greece. The article suggests that the IMF has signalled its willingness to participate in the program and would only provide money if Greece proves its debt is sustainable. Looking at today’s calendar, the only data due out in Europe this morning comes from Germany where the flash June consumer confidence reading is due. This afternoon in the US we’ll get the March FHFA house price index reading and also April existing home sales data. This evening we then get the FOMC minutes from the meeting on May 3rd where most be will combing through for discussion on the Fed’s balance sheet strategy. It’s another busy day for Fedspeak today too with Kaplan (11pm BST) and Kashkari (11.30pm BST) both scheduled. ECB President Draghi also speaks in Madrid at 1.45pm BST while Praet  speaks this morning.

24 мая, 12:00

Catalonia Threatens Immediate Declaration Of Independence If Spain Doesn't Approve Referendum

  • 0

Authored by Mike Shedlock via MishTalk.com, The constitutional crisis in Spain may be coming to a head quickly according to a leaked document on a “Secret Law for Catalonia Independence” as reported by El Pais.  Spain’s Attorney General José Manuel Maza is set to examine the legality of a plan outlined by the regional government of Catalonia to activate immediate secession from Spain if the central government in Madrid stops it from holding a vote on independence – something it is planning on doing in September or October of this year.   The independence mechanism is detailed in a secret draft version of legislation being prepared by the Generalitat, the Catalan regional government, and to which EL PAÍS has had access.   The document aims to work as a provisional Catalan Constitution that, according to the text, would be in place during the two-month period that the parliament would have to begin a process that would culminate in the “parliamentary republic” of Catalonia.   “If the Spanish state effectively impedes the holding of a referendum, this law will enter into effect in a complete and immediate manner when the [regional] parliament has verified such an impediment,” the draft legislation reads.   The document has a section that covers the referendum itself and features the question that would be asked of voters: “Do you want Catalonia to be a state that is independent from Spain?” The intention in the text is that this part of the legislation would come into effect first in order to be able to hold the referendum, and indicates that a majority of votes in favor, no matter how slim, and with no minimum participation level, would ratify the decision and mean that it was binding.   The text makes a number of references to itself as being a “founding law,” and goes into exhaustive details – albeit with many legal loopholes and unknowns – about the breakaway: i.e. who would be a Catalan citizen, how it would be possible to obtain nationality, which Spanish laws would remain in force and which would not, what would happen to government workers currently employed by the state, among other details.   The authors of the text ignore legal and material elements that have enormous importance and complexity, such as the whether this new republic would continue to form part of Europe, or whether social benefits or pensions would be guaranteed, or whether all taxation – and fines for non-payment – would be the responsibility of the regional government.   Under the reasoning of the authors of the text, none of these issues would infringe the law because, as the second article reads, “national sovereignty resides with the people of Catalonia, from whom all powers of the State emanate.” Expect Fireworks The Catalonia independence threat is smack on top of a Spanish government crisis in which Mariano Rajoy has threatened to dissolve parliament and call snap elections if his budget does not pass. The surprise results of Socialist Party (PSOE) leadership election on Sunday, in which Pedro Sánchez returned to power, makes it very likely Rajoy will not get his budget passed. For details, please see Voters Smack Spain’s Political Leadership: Snap Spanish Presidential Elections Coming Up? * * * As a reminder, Catalonia is not alone...

Выбор редакции
24 мая, 11:15

Fidelity Is Mining Bitcoin, CEO Abigail Johnson Admits

  • 0

In what bitcoin geeks undoubtedly interpreted as a sign of bitcoin’s renewed relevance now that its price is at all-time highs, Fidelity CEO Abigail Johnson told CoinDesk’s Consensus conference that her company is now in the business of mining bitcoin. Per the FT: “Ms Johnson noted that Fidelity has also set up a bank of computers built by 21 Inc that can crunch complex algorithms to be rewarded with bitcoin.   “My…computer has mined over 200,000 satoshis,” she said, using the name for the smallest unit of bitcoin. Her remarks coincide with an astounding rally in virtual currencies like bitcoin. As DoubleLine’s Jeffrey Gundlach noted on Tuesday, bitcoin is up 100% in under two months, implying that the turmoil in Chinese markets was driving more locals into bitcoin. One coin was trading at $2,275 Tuesday according to Coinbase, the latest in a series of all-time highs as global uncertainty rises... Johnson also added that Fidelity now allows employee to pay for lunch with bitcoin at the cafeteria in its Boston headquarters. She noted that fewer than 100 employees have paid with bitcoin, demonstrating an unnatural-sounding mastery of industry slang. “I guess we have a lot of hodlers,” she said, using the slang for bitcoin users who avoid selling the currency when it jumps in value. And Fidelity's CEO also revealed information about her company's partners on its journey, naming blockchain startup Axoni, investment firm Boost VC and university initiatives based out of MIT, University College London and Cornell. To date, Johnson explained that Fidelity Labs, its internal R&D division has also set up experiments for bitcoin micropayments and even run bitcoin and ethereum mining operations in the spirit of learning more about the technology. Further, she revealed that Fidelity will be taking some conservative steps to expose Fidelity's customers more to the industry, announcing that customers will soon be able to see Coinbase holdings on Fidelity.com. Already, she said, this feature is available to employees who own digital currencies available through the startup's services.

Выбор редакции
24 мая, 10:30

Turkish NBA Player Has Passport Revoked By "Hitler Of Our Century"

  • 0

Authored by Simon Black via SovereignMan.com, Enes Kanter is a Turkish citizen who plays center for the NBA’s Oklahoma City Thunder. Like many professional athletes, Kanter has a couple of charities in his name. His education fund provides first-year college scholarships to support selected US students – including a family’s first female child and children of law enforcement and firefighters who lost their lives on duty. Kanter’s other charity is the Light Foundation. This one has an international bent, providing meals and clothes to needy families. A global tour with the Light Foundation stirred up Friday’s troubles. After traveling to a few countries, Kanter and his team flew from Indonesia to Romania. But upon landing in Romania, Kanter found his passport cancelled by the Turkish embassy. Kanter’s crime? His political views. Enes Kanter has long been a vocal critic of Turkey’s president, Recep Erdogan, calling him the Hitler of our century. Although not a Hitler, Erdogan is far from an angel. In July 2016 when facing a coup, he ordered his forces to open fire on his own people, killing 270. He had another 50,000 arrested. Last month in the country’s constitutional referendum, Erdogan consolidated greater power by the slimmest majority – 51% of the votes, if the vote count is to be believed. With that victory, Erdogan has near dictatorial powers, which is why he was able to unilaterally suspend Kanter’s passport. Last week, I wrote about Venezuela. There, government-sanctioned snipers scan the streets. Its starving, desperate citizens are trapped inside the country’s borders with no way out. To Europeans and Americans, Turkey’s crackdown and Venezuela’s hell on earth are a world away from their comfortable lives. But in the West, symptoms of government overreach that adversely impact its citizens’ futures are everywhere. The war on cash continues unabated. Near-zero interest rates return nothing on retirees’ life savings. Easy credit ensures that any entrepreneur with a bozo idea receives funding. And it fuels both our insane stock market valuations and consumer debt to all-time highs. US regulators crank out 150, 200, sometimes 300+ pages daily. And then there’s the ballooning national debts of the Eurozone and the US. It would be foolish to place all your faith and confidence in only one such government. Enes Kanter’s experience with Turkey is the latest example. It shows how susceptible citizens are to an out of control government, even when traveling beyond its borders. Whether locked inside borders like Venezuelans or locked out of travel like Kanter, these cases highlight the importance of having a Plan B. A savings account in a well-capitalized foreign jurisdiction, investments outside the ridiculously valued stock market (e.g. Peer to Peer lending backed by real collateral), a second residence and yes, a second passport…these are steps to ensure that no matter what, you’ll be okay. You’re not going to be worse off because you’re holding a significant amount of, say, Hong Kong dollars. You’re not going to curse the fact that you receive steady and safe investment returns. And you’re not going to worry about your ability to freely travel around the world. Oh, and if what happened to Kanter seems impossible, consider this: On December 30, 2015 when no one was looking, the US government passed H.R. 22 (The FAST Act), which authorizes them to revoke your passport if they believe, in their sole discretion, that you owe $50,000 in taxes. It’s important to note that they don’t actually have to prove any wrongdoing. They can make a simple allegation. It could even be a clerical error. Then, poof, no more passport. It’s important to have a hedge against this to ensure that your entire life and livelihood isn’t held in the hands of a single government. Do you have a Plan B?

Выбор редакции
24 мая, 09:45

If At First You Don't Succeed... A Timeline Of Elon Musk's Long List Of Failures

  • 0

At first glance, it’s easy to be impressed by Elon Musk’s impressive resume. He’s shooting for the stars with SpaceX, changing the future of transportation with Tesla, Hyperloop, and The Boring Company, and he’s already had a profound impact on the e-commerce and payments sectors through Paypal. It’s no coincidence that most of these are $1 billion+ companies. But, as Visual Capitalist's Jeff Desjardins notes, focusing only on his successes provides a superficial view of the man. To get the full perspective on his career, it is much more interesting to look at the failures and lows he has experienced. These are the moments when most people would have likely given up. FAILING OFTEN As every entrepreneur knows, any business venture can be upended by failures at any moment – and it is how one bounces back from those failures that counts. Today’s infographic from Kickresume shows Musk’s struggles and failures throughout his career, and how he persevered to become a modern business icon. Courtesy of: Visual Capitalist As the ever-quotable Winston Churchill once said: Success is not final, failure is not fatal: it is the courage to continue that counts. – Winston Churchill After being ousted out of his own company, having many rockets go bust, and fighting to keep Tesla and SpaceX from going bankrupt, Musk kept pushing forward with courage. WHAT WE CAN LEARN Entrepreneurs hold people like Steve Jobs, Elon Musk, and Richard Branson in high reverence. Sometimes, we even put them on a pedestal, thinking we could only dream of making such a profound impact on the world. However, this is obviously a one dimensional view. These figures are not superhuman, and the reality is that they’ve all experienced tragic failures throughout the course of their careers. They’ve been disheartened, but they bounced back. We have to recognize that success in business isn’t what it appears to be on magazine covers and headlines. Failure is an everyday part of doing business, and it plagues almost every entrepreneur in some shape or form. The difference is in how you react to it. ...and of course, it helps to be on the right side of government handouts too...

24 мая, 09:00

Did Trump's Islam Speech In Saudi Arabia Pave The Way For America's Next Big War

  • 0

Authored by Darius Shahtahmasebi via TheAntiMedia.org, The American public is most likely unaware of the giant stranglehold Saudi Arabia has on the U.S. government. Saudi Arabia uses its vast riches to manipulate the U.N., which explains how a country that brutally oppresses its female population was recently gifted a seat on the organization’s women’s rights commission. The Islamic Kingdom also wields incredible control over international media and has arguably had an increasingly unwelcome position of power in America’s foreign policy decision-making. As such, Donald Trump’s political career, in part, rests on appeasing his Saudi Arabian counterparts. And appeasing the Saudis is exactly what Trump has done. Trump’s speech regarding Islam was delivered to the leaders of 55 Muslim-majority nations, including Saudi Arabia. However, he conveniently ignored the troves of evidence that show Saudi Arabia directly sponsors the terror groups al-Qaeda and ISIS – two groups the U.S. claims to be at war with — as well as the fact that Saudi Arabia has been directly implicated in the 9/11 terror attacks. Instead, Donald Trump framed the entire issue of radicalization as a problem that rests with Iran. As he stated in Riyadh: “But no discussion of stamping out this threat would be complete without mentioning the government that gives terrorists all three—safe harbor, financial backing, and the social standing needed for recruitment. It is a regime that is responsible for so much instability in the region. I am speaking of course of Iran. From Lebanon to Iraq to Yemen, Iran funds, arms, and trains terrorists, militias, and other extremist groups that spread destruction and chaos across the region. For decades, Iran has fueled the fires of sectarian conflict and terror.”   It is a government that speaks openly of mass murder, vowing the destruction of Israel, death to America, and ruin for many leaders and nations in this room.” Iran’s prime enemies are actually Sunni-dominated terror groups such as al-Qaeda and ISIS. The Islamic Republic and its proxies have been heavily engaged in fighting these terror groups in Syria. If eradicating terrorism was a priority for the United States and Saudi Arabia, Iran would be a natural ally considering Iran almost all but defeated ISIS in Iraq. Yet, Trump continued: "Among Iran’s most tragic and destabilizing interventions have been in Syria. Bolstered by Iran, Assad has committed unspeakable crimes, and the United States has taken firm action in response to the use of banned chemical weapons by the Assad regime—launching 59 tomahawk missiles at the Syrian air base from where that murderous attack originated.” While many analysts may focus on how Trump has gone from the most Islamophobic president ever elected to now omitting the words “radical Islamic terrorism” from his speech on Islam, these analysts continue to gloss over the fact that the entire speech appears to have been a geopolitical gesture to please Saudi Arabia and its allies. As the Iranian Foreign Ministry noted, Trump is no longer concerned with Islamophobia but what Iran has coined as “Iranophobia.” Iran is Saudi Arabia’s regional archrival. The two countries are fighting an enormous proxy war in Syria because Saudi Arabia views an Iranian-aligned government as a threat to its economic interests. Saudi Arabia is also currently bombing Yemen into oblivion as fears of a Shi’a led government capable of aligning itself with Tehran became a probable reality in 2015. Most hypocritical, however, was the following statement: “Until the Iranian regime is willing to be a partner for peace, all nations of conscience must work together to isolate Iran, deny it funding for terrorism, and pray for the day when the Iranian people have the just and righteous government they deserve.” Even establishment outlets such as the BBC could not allow this statement to go unchecked. The BBC stated: “And amongst several cynical reactions to the speech from around the region on social media, some have pointed out that here in Saudi Arabia women are forbidden to drive and there are no parliamentary elections. In Iran, the country accused by Mr Trump of being behind much of the current terrorism across the Middle East, they have just had a free election and women are free to drive.” [emphasis added] Iran’s recent elections saw one of the heaviest turnouts in the country’s history, much higher than that of the United States. It is technically one of the most democratic countries in the region. While Iran would not be considered greatly democratic by Western standards, this is a testament to how undemocratic Iran’s rivals in the region are, including Saudi Arabia. Even prisoners were allowed to vote in Iran, something so-called democratic countries such as New Zealand disallow. Despite all of this “Iranophobic” sentiment, it is also worth noting that Iran’s alleged nuclear program is rarely discussed in the international arena anymore. This is because the Trump administration is well aware that the Iranian nuclear deal reached in 2015 is working – and there is no current nuclear threat from Iran. In this context, the U.S. government has to look for alternative modes of hyping up an Iranian threat to justify a massive arms deal. And yet, spearheaded by Trump, the Arab world has just announced a new military pact that will directly confront Iran. Called the “Riyadh Declaration,” the pact was signed by representatives from 55 Islamic nations that have vowed “to combat terrorism in all its forms, address its intellectual roots, dry up its sources of funding and to take all necessary measures to prevent and combat terrorist crimes in close cooperation among their states.” How can a coalition, led by Saudi Arabia, combat terrorism and extremism when Saudi Arabia’s Wahhabist philosophy is responsible for most of today’s terrorism-related problems? As noted by the Independent: “The state systematically transmits its sick form of Islam across the globe, instigates and funds hatreds, while crushing human freedoms and aspiration…The jaw simply drops. Saudi Arabia executes one person every two days…Raif Badawi, a blogger who dared to call for democracy, was sentenced to 10 years and 1,000 lashes. Last week, 769 faithful Muslim believers were killed in Mecca where they had gone on the Hajj. Initially, the rulers said it was ‘God’s will’ and then they blamed the dead.” The military pact will also include an “Islamic Military Coalition,” which will “provide a reserve force of 34,000 troops to support operations against terrorist organizations when needed.” The original text of the document was heavily infatuated with Iran but has since been amended. The original text also said these troops would be deployed to Syria and Iraq “when needed,” which is — again — clearly aimed at countering Iranian influence as Iran is heavily tied to both countries. Saudi Arabia has already expressed its intention to send troops into Syria multiple times before, with the exclusive goal of ensuring that “liberated areas [do] not fall under the control of Hizballah, Iran or the regime.” The United States, Britain, and associated forces are creeping into Syria as we speak, directly paving the way for an all-out confrontation with Syrian troops in al-Tanf. Just last week, the U.S. military bombed these troops, even though they are directly backed by Iran (and most likely Russia, too). This is no secret to the mainstream media. The Washington Post just released an article hours ago entitled “How Trump could deal a blow to Iran — and help save Syria,” with the conclusion that the battle for al-Tanf  is “a fight that the United States cannot and should not avoid.” Dealing a strategic blow to Iran and Syria will only empower ISIS given that they are the most heavily engaged entities fighting the terror groups in Syria. The Trump administration’s seeds are being sown in tandem with the corporate media. Trump’s speech had nothing to do with radical Islam. It was written by Stephen Miller, the “architect” of Donald Trump’s travel ban (a policy that also vehemently targeted Iran, among other countries). Selling a war with Iran to the American public may be difficult considering the Islamic nation twice elected a reformist who is open to making diplomatic deals with the United States. However, selling a war that will take place inside Syria is somewhat less problematic, even if that war is against the Syrian government, as the American public is easily manipulated by Assad’s alleged war crimes. As Iran is Syria’s closest ally, it will be easily drawn into a confrontation. If Saudi Arabia’s coalition of anti-Iranian Muslim nations illegally joins this battle arena, the resulting war will be catastrophic.

Выбор редакции
24 мая, 06:25

WannaCry Attackers Have Links To North Korea's Lazarus Group

  • 0

Cybersecurity researchers at Symantec say they've found linkes between the WannaCry Ransomware attackers was likely carried out by a hacking group with ties to North Korea. In a blog post, Symantec said the “Tools and infrastructure used in the WannaCry ransomware attacks have strong links to Lazarus, the group that was responsible for the destructive attacks on Sony Pictures and the theft of $81 million from the Bangladesh Central Bank.” Here's a summary of links provided by Symantec: Following the first WannaCry attack in February, three pieces of malware linked to Lazarus were discovered on the victim’s network: Trojan.Volgmer and two variants of Backdoor.Destover, the disk-wiping tool used in the Sony Pictures attacks. Trojan.Alphanc, which was used to spread WannaCry in the March and April attacks, is a modified version of Backdoor.Duuzer, which has previously been linked to Lazarus. Trojan.Bravonc used the same IP addresses for command and control as Backdoor.Duuzer and Backdoor.Destover, both of which have been linked to Lazarus. Backdoor.Bravonc has similar code obfuscation as WannaCry and Infostealer.Fakepude (which has been linked to Lazarus). There is shared code between WannaCry and Backdoor.Contopee, which has previously been linked to Lazarus. Symantec discovered that the WannaCry attackers used some of the same hacking tools that were previousky used in other Lazarus Group attacks. There are also, the group reported, “a number of links between WannaCry itself and Lazarus.” The WannaCry ransomware, for example, shares some code with a piece of malware that has previously been linked to Lazarus. Symantec also found that the WannaCry attackers used some of the same network infrastructure as the Lazarus Group. “There are a number of crossovers seen in the C&C servers used in the WannaCry campaigns and by other known Lazarus tools.” Beginning a week ago Friday, the WannaCry virus infected thousands of computers around the world, threatening to destroy users' data unless a ransom was paid in bitcoin. Ultimately, the group received less than $100,000, and most of the data were destroyed.

24 мая, 06:00

The Republic Has Fallen: The Deep State's Plot To Take Over America Has Succeeded

  • 0

Submitted by John Whitehead via The Rutherford Institute, No doubt about it. The coup d’etat has been successful. The Deep State - a.k.a. the police state, a.k.a. the military industrial complex - has taken over. The American system of representative government has been overthrown by a profit-driven, militaristic corporate state bent on total control and global domination through the imposition of martial law here at home and by fomenting wars abroad. When in doubt, follow the money trail. It always points the way. Every successive president starting with Franklin D. Roosevelt has been bought—lock, stock and barrel—and made to dance to the tune of the Deep State. Enter Donald Trump, the candidate who swore to drain the swamp in Washington DC. Instead of putting an end to the corruption, however, Trump has paved the way for lobbyists, corporations, the military industrial complex, and the Deep State to feast on the carcass of the dying American republic. Just recently, for instance, Trump agreed to sell Saudi Arabia more than $110 billion in military weapons. Meanwhile, Trump—purportedly in an effort to balance the budget in 10 years—wants to slash government funding for programs for the poor, ranging from health care and food stamps to student loans and disability payments. The military doesn’t have to worry about tightening its belt, however. No, the military’s budget—with its trillion dollar wars, its $125 billion in administrative waste, and its contractor-driven price gouging that hits the American taxpayer where it hurts the most—will continue to grow, thanks to Trump. This is how you keep the Deep State in power. The rich will get richer, the poor will get poorer, the military will get more militaristic, America’s endless wars will get more endless, and the prospect of peace will grow ever dimmer. As for the terrorists, they will keep on being played for pawns as long as Saudi Arabia remains their breeding ground and America remains the source of their weapons, training and know-how. Follow the money.  It always points the way. As Bertram Gross noted in Friendly Fascism: The New Face of Power in America, “evil now wears a friendlier face than ever before in American history.” Writing in 1980, Gross predicted a future in which he saw: …a new despotism creeping slowly across America. Faceless oligarchs sit at command posts of a corporate-government complex that has been slowly evolving over many decades. In efforts to enlarge their own powers and privileges, they are willing to have others suffer the intended or unintended consequences of their institutional or personal greed. For Americans, these consequences include chronic inflation, recurring recession, open and hidden unemployment, the poisoning of air, water, soil and bodies, and, more important, the subversion of our constitution. More broadly, consequences include widespread intervention in international politics through economic manipulation, covert action, or military invasion... We’ve been losing our freedoms so incrementally for so long—sold to us in the name of national security and global peace, maintained by way of martial law disguised as law and order, and enforced by a standing army of militarized police and a political elite determined to maintain their powers at all costs—that it’s hard to pinpoint exactly when it all started going downhill, but we’re certainly on that downward trajectory now, and things are moving fast. The “government of the people, by the people, for the people” has perished. It will not be revived or restored without a true revolution of values and a people’s rebellion the likes of which we may not see for a very long time. America is a profitable business interest for a very select few, and war—wars waged abroad against shadowy enemies and wars waged at home against the American people—has become the Deep State’s primary means of income. After all, war is big business. In order to maintain a profit margin, one would either have to find new enemies abroad or focus on fighting a war at home, against the American people, and that’s exactly what we’re dealing with today. Wars waged abroad to the tune of trillions of dollars since 9/11. Military equipment sold to foreign enemies. Local police transformed into a standing army in the American homeland through millions of dollars’ worth of grants to local police agencies for military weapons, vehicles, training and assistance. The public acclimated to the sights and sounds of martial law through urban training exercises and domestic military training drills timed and formulated to coincide with or portend actual crises. The citizenry taught to fear and distrust each other and to welcome the trappings of the police state. Had the government tried to ram such a state of affairs down our throats suddenly, it might have had a rebellion on its hands. Instead, the American people have been given the boiling frog treatment, immersed in water that slowly is heated up—degree by degree—so that they’ve fail to notice that they’re being trapped and cooked and killed. “We the people” are in hot water now. As I make clear in my book Battlefield America: The War on the American People, the Constitution doesn’t stand a chance against a federalized, globalized standing army protected by legislative, judicial and executive branches that are all on the same side, no matter what political views they subscribe to: suffice it to say, they are not on our side or the side of freedom. From Clinton to Bush, then Obama and now Trump, it’s as if we’ve been caught in a time loop, forced to re-live the same thing over and over again: the same assaults on our freedoms, the same disregard for the rule of law, the same subservience to the Deep State, and the same corrupt, self-serving government that exists only to amass power, enrich its shareholders and ensure its continued domination. The republic has fallen to fascism with a smile. Elections will not save us. Learn the treacherous lessons of 2008 and 2016:  presidential elections have made a mockery of our constitutional system of government, suggesting that our votes can make a difference when, in fact, they merely serve to maintain the status quo. Don’t delay. Start now—in your own communities, in your schools, at your city council meetings, in newspaper editorials, at protests—by pushing back against laws that are unjust, police departments that overreach, politicians that don’t listen to their constituents, and a system of government that grows more tyrannical by the day. If you wait until 2020 to rescue our republic from the clutches of the Deep State, it will be too late.

24 мая, 05:35

Here Are The 66 Programs That Trump's Budget Eliminates

  • 0

President Trump's fiscal 2018 budget proposal would completely eliminate 66 federal programs, for a savings of $26.7 billion.  As The Hill reports, some of the programs would receive funding for 2018 as part of a phasing-out plan. Here are the programs the administration wants on the chopping block... Agriculture Department — $855 million McGovern-Dole International Food for Education Business-Cooperative Service Rural Water and Waste Disposal Program Account Single Family Housing Direct Loans Commerce Department — $633 million Economic Development Administration Manufacturing Extension Partnership Minority Business Development Agency National Oceanic and Atmospheric Administration Grants and Education Education Department — $4.976 billion 21st Century Community Learning Centers Comprehensive Literacy Development Grants Federal Supplemental Educational Opportunity Grants Impact Aid Payments for Federal Property International Education Strengthening Institutions Student Support and Academic Enrichment Grants Supporting Effective Instruction State Grants Teacher Quality Partnership Energy Department — $398 million Advanced Research Projects Agency—Energy Advanced Technology Vehicle Manufacturing Loan Program and Title 17 Innovative Technology Loan Guarantee Program Mixed Oxide Fuel Fabrication Facility Health and Human Services — $4.834 billion Agency for Healthcare Research and Quality Community Services Block Grant Health Professions and Nursing Training Programs Low Income Home Energy Assistance Program Homeland Security — $235 million Flood Hazard Mapping and Risk Analysis Program Transportation Security Administration Law Enforcement Grants Housing and Urban Development — $4.123 billion Choice Neighborhoods Community Development Block HOME Investment Partnerships Program Self-Help and Assisted Homeownership Opportunity Program Account Interior Department — $122 million Abandoned Mine Land Grants Heritage Partnership Program National Wildlife Refuge Fund Justice Department — $210 million State Criminal Alien Assistance Program Labor Department — $527 million Migrant and Seasonal Farmworker Training OSHA Training Grants Senior Community Service Employment Program State Department and USAID — $4.256 billion Development Assistance Earmarked Appropriations for Non-Profit Organizations The Asia Foundation East-West Center P.L. 480 Title II Food Aid State Department, USAID, and Treasury Department — $1.59 billion Green Climate Fund and Global Climate Change Initiative Transportation Department — $499 million National Infrastructure Investments (TIGER) Treasury Department — $43 million Global Agriculture and Food Security Program Environmental Protection Agency — $493 million Energy Star and Voluntary Climate Programs Geographic Programs National Aeronautics and Space Administration — $269 million Five Earth Science Missions Office of Education Other Independent Agencies — $2.683 billion Chemical Safety Board Corporation for National and Community Service Corporation for Public Broadcasting Institute of Museum and Library Services International Development Foundations African Development Foundation Inter-American Foundation Legal Services Corporation National Endowment for the Arts National Endowment for the Humanities Neighborhood Reinvestment Corporation Overseas Private Investment Corporation Regional Commissions Appalachian Regional Commission Delta Regional Authority Denali Commission Northern Border Regional Commission U.S. Institute of Peace U.S. Trade and Development Agency Woodrow Wilson International Center for Scholars

Выбор редакции
24 мая, 05:10

Ron Paul On The Drug War: Will The Trump Administration OD On Authoritarianism?

  • 0

Authored by Ron Paul via The Ron Paul Institute for Peace & Proseprity, Last week Attorney General Jeff Sessions ordered federal prosecutors in drug cases to seek the maximum penalty authorized by federal mandatory minimum sentencing laws. Sessions’ order represents a setback to the progress made toward restoring compassion and common sense to the sentencing process over the past few years. Sessions’ action also guarantees that many nonviolent drug law offenders will continue spending more time in prison than murderers. Sessions’ support for mandatory minimums is no surprise, as he has a history of fanatical devotion to the drug war. Sessions’ pro-drug war stance is at odds with the reality of the drug war’s failure. Over forty years after President Nixon declared war on drugs, the government cannot even keep drugs out of prisons! As was the case with alcohol prohibition, the drug war has empowered criminal gangs and even terrorists to take advantage of the opportunity presented by prohibition to profit by meeting the continued demand for drugs. Drug prohibition enables these criminal enterprises to make profits far above the potential profits if drugs where legalized. Ironically, the so-called “law-and-order” politicians who support the drug war are helping enrich the very criminals they claim to oppose! The war on drugs also makes street drugs more lethal by incentivizing the creation of more potent and, thus, more dangerous drugs. Of course, even as Sessions himself admits, the war on drugs also leads to increased violence, as drug dealers cannot go to the courts to settle disputes among themselves or with their customers. Before 9/11, the war on drugs was the go-to excuse used to justify new infringements on liberty. For example, laws limiting our ability to withdraw, or even carry, large sums of cash and laws authorizing civil asset forfeiture were justified by the need to crack down on drug dealers and users. The war on drugs is also the root cause of the criminal justice system’s disparate treatment of minorities and the militarization of local police. The war on drugs is a war on the Constitution as well. The Constitution does not give the federal government authority to regulate, much less ban, drugs. People who doubt this should ask themselves why it was necessary to amend the Constitution to allow the federal government to criminalize drinking alcohol but not necessary to amend the Constitution to criminalize drug use. Today, a majority of states have legalized medical marijuana, and a growing number are legalizing recreational marijuana use. Enforcement of federal laws outlawing marijuana in those states is the type of federal interference with state laws that conservatives usually oppose. Hopefully, in this area the Trump administration will exercise restraint and respect state marijuana laws. Sessions’ announcement was not the only pro-drug war announcement made by the administration this week. President Trump himself, in a meeting with the president of Columbia, promised to continue US intervention in South and Central America to eliminate drug cartels. President Trump, like his attorney general, seems to not understand that the rise of foreign drug cartels, like the rise of domestic drug gangs, is a consequence of US drug policy. The use of government force to stop adults from putting certain substances into their bodies - whether marijuana, saturated fats, or raw milk - violates the nonaggression principle that is the bedrock of a free society. Therefore, all those who care about protecting individual liberty and limiting government power should support ending the drug war. Those with moral objections to drug use should realize that education and persuasion, carried out through voluntary institutions like churches and schools, is a more moral and effective way to discourage drug use than relying on government force.

24 мая, 04:59

Why China's Strategic Petroleum Reserve Is All That Matters For OPEC

  • 0

When OPEC sits down on Thursday, keeping the price of Brent above $50 (to avoid a budget catastrophe and social upheaval in Saudi Arabia) and below $60 (to prevent US production from going exponential), will be just one problem the cartel nations and various hangers-on will be desperate to solve. A much bigger one, literally, is the problem that led to this week's OPEC meeting in the first place, and years of headache for OPEC and non-OPEC nations: a record global oil inventory glut. The supply glut that began in mid-2014 has dumped almost one billion barrels of petroleum into global inventories. However, of this only 35–45% has ended up in transparent OECD tanks. For OPEC, that is all the matters - in the past, OPEC oil ministers have repeatedly referenced the level of OECD petroleum inventories relative to their five-year average as a gauge of the rebalancing. And, as ScotiaBank notes, those inventories were more than 280 Mbbl above their five-year average as of January and, while European stocks have been falling into a healthier range, the same cannot be said of industry stocks in the US, which despite declining for several weeks, are just below all time highs. But forget OECD: an increasingly greater concern for OPEC is not the less than a third of above ground oil held in developed nations; it is the rest that is the big challenge. As ScotiaBank's Rory Johnston points out in the following chart, the majority of the remainder was absorbed by China’s vast and growing strategic petroleum reserve (SPR), which means that "the lion’s share of functional—and thus needing to draw from an OPEC perspective—industry inventories remain in the OECD, and specifically in the US (chart 3)." As we have explained on several occasions over the past year, China's SPR is far more important to the global oil (im)balance and inventory glut than the less than a third of total oil produced since the summer of 2014 and stored. This is due to one main reason: while ScotiaBank is correct that any draws will likely come from OECD storage, it forgets the demand side of the equation.   Storage tanks in China's strategic oil reserve complex in Zhoushan One year ago, JPMorgan estimated that the daily build of China's SPR, had grown at a breakneck pace, from 491Kbpd average in 2015 to a record 1.191MMbpd in 2016 through May, equivalent to roughly 15% of the country's total crude oil imports. More importantly, it was roughly a year ago when JPM calculated that China's SPR was getting dangerously close to its estimated capacity, just over 500 million barrels. JPM also made a forecast that based on its assumptions, Chinese oil imports would slide by roughly the amount that would have been going into the SPR starting in late 2016 as the reserve hit capacity. When that did not happen, there was much confusion among the commodity space, until in late September 2011, satellite imagery from Orbital Insight revealed that the total size of China's SPR was vastly greater than previously estimated. According to satellite images by  geospatial analytics startup Orbital Insight, China, has not only misrepresented how much oil it has stored, it has done so at a massive scale, with the real number dwarfing even JPM own estimate: the real amount of Chinese oil in storage, according to Orbital, was a whopping 600 million barrels as of May. Assuming JPM's estimated rate of SPR accumulation of about 1mmbpd, the 600 million number as of May would have grown to well over 700 million barrels as of September.    Orbital’s figure as first reported by Bloomberg, is well over two times larger than China’s official estimates for strategic petroleum reserves and for commercial stocks, said Orbital Chief Executive Officer James Crawford. To be sure, in late 2016 other skeptics started warning that even with the revised size estimates, China's SPR was likely approaching capacity. Last September, the IEA warned that "recent pillars of demand growth China and India are wobbling." S&P Global Platts' Ernsberger, cited by CNBC, said that the slowdown in Chinese demand was worrying for major oil producers. "The demand picture is very unsettling for OPEC and for all producers of crude and refined products (and this is seen most significantly in) the slowdown in growth in the Chinese market. China has returned more incremental demand for the oil market in the last five years than any other country in the world and more than almost any of the counties combine. But this year demand growth in China has stalled and that represents a significant change in the environment for producers both in OPEC and outside it." Then 2016 came and went, and we find ourselves almost mid-way into 2017 and ask: has anything finally changed, and will all those predictions of an imminent Chinese SPR overflow finally prove accurate? We don't know just yet, but according to data released by the General Administration of Customs data on Tuesday, China's oil stockpiling pace finally tumbled to 1.36mbpd in April, from 1.6mbpd in March, the sharpest decline in reserve accumulation in years, and in line with the recent slowdown from record oil imports. If indeed China is finally at capacity for the SPR, the SPR stocpiling is about to fall off as cliff this month. In other words, all those forecasts that China's SPR is almost full appear to be finally coming true, and at the worst possible time for OPEC, because if suddenly over 1 million in daily "demand" is pulled from the market, OPEC will suddenly find themselves with another huge glut now that Beijing is no longer waving it in. In fact, we contend that while OPEC's decision on Thursday is fully priced in by the market, the only thing that matters for the future price of oil is how long until China halts SPR imports. Here, those who have faster access to commercial satellite imagery will be a distinct advantage over everybody else, even the momentum-chasing, headline scanning algos...