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"What creativity can there be, when only money can buy you your next opportunity?"
Unknown free-lance film maker in Netherlands, 2014
 

Commentary: "Soros Continues Betting Against US Stock Market Despite Mounting Losses" [08/16/17] Printer Friendly Version "US regulatory filings show George Soros is still investing in options that will profit him only if the stock market they are linked to declines in value.  Soros Fund Management held put options on PowerShares QQQ Trust, SPDR S&P 500 ETF, iShares Russell 2000 ETF as of June 30. Each is an exchange-traded fund that tracks a broad US stock market index. The bet is worth $1.8 billion. Soros stands to profit only if the stock market falls. Michael Vachon, a spokesman for Soros Fund Management, said the company would not comment on the filing. In January, Soros said "it's impossible to predict" US President Donald Trump's actions, but he was nonetheless sure the market would plunge. Soon after the election, Soros lost over $1 billion by taking a short position on the market. While Soros called Trump a "would-be dictator," and predicted uncertainty and a sell-off after his win, the markets have rallied significantly. The US S&P500 index is up over 10 percent this year, the Nasdaq is up 18 percent, and Dow Jones is up over 11 percent. Soros is best known for making a fortune on his short play against the British pound. On 16 September 1992, Soros' $10 billion short position on the pound forced the Bank of England to withdraw Sterling from the European Exchange Rate Mechanism (ERM) after it was unable to keep the currency above its agreed lower limit in the ERM. [...]" 

Commentary: "Crimeans No Longer Have To Pay Their Debts Taken On At Ukrainian Banks" [08/16/17] Printer Friendly Version "The head of Crimea, Sergey Aksenov, approved a bill that exempts the residents of the republic of Crimea from payments on loans taken from Ukrainian banks. Amendments to the legislation give the Crimean parliament the right to write off the debts of citizens. The law will cancel in full the amount of debts up to 5 million rubles. The initiative was developed with the participation of the Ministry of Finance of the Republic and the main state legal department of the presidential administration. As for the debts of more than 5 million rubles - every time a repayment of 5% is made, 20% will be annulled from the total amount. The law particularly seeks to look after the interests of unprotected categories of the population, including disabled people and their dependents. [...]"  

Commentary: "Israeli Billionaire Steinmetz Detained In Intl. Fraud, Forgery, Money Laundering Probe" [08/15/17] Printer Friendly Version "Israeli police detained billionaire Beny Steinmetz and four other men Monday, as part of an international fraud investigation spanning four continents. The detainees allegedly "acted together and methodically with the prime suspect in order to create and present fictitious contracts and deals... on a foreign country in order to transfer funds and launder money," an Israeli police spokesperson said as cited by Reuters. [...] Steinmetz and his alleged accomplices are being held for questioning under caution “on suspicion of money laundering, fraudulent filing of corporate documents, fraud and corporate breach of trust, obstruction of justice and bribery. Steinmetz called the investigation a "political war" waged by George Soros, reports Haaretz." 

Commentary: "US Launches Quiet Crackdown On Cryptocurrencies" [08/14/17] Printer Friendly Version "While all eyes were distracted with the Trump-demeaning headlines of the foreign sanctions bill, few spotted the hidden mandate that foreign governments monitor cryptocurrency circulations as a measure to combat "illicit finance trends" in an effort to "combat terrorism." As Coinivore reports, the bill requires the governments to develop a “national security strategy” to combat the “financing of terrorism and related forms of illicit finance.” Governments will be further required to monitor “data regarding trends in illicit finance, including evolving forms of value transfer such as so-called cryptocurrencies.”[...]" Related: "U.S. Sanctions Mandate That Foreign Governments Monitor Cryptocurrency To Combat Terrorism" Printer Friendly Version  "Trump signed a new controversial foreign sanctions bill into law that had a hidden mandate for the foreign governments of Iran, Russia, and North Korea to monitor cryptocurrency circulations as a measure to combat “illicit finance trends” in an effort to “combat terrorism.” The bill requires the governments to develop a “national security strategy” to combat the “financing of terrorism and related forms of illicit finance.” Governments will be required to monitor “data regarding trends in illicit finance, including evolving forms of value transfer such as so-called cryptocurrencies.” According to the bill, an initial draft strategy is expected to come before Congress within the next year, and will see input from U.S. financial regulators, the Department of Homeland Security, and the State Department.[...] Just more examples of the U.S. government trying to impose its will upon other nations and citizens who never lived there, as witnessed with the arrest of Alexander Vinnik in Greece, BTC-E’s alleged CEO according to the Department Of Justice.[...]" | "Keiser Report: Geopolitics & Cryptocurrencies (E1109)" [27:43] "In this episode of the Keiser Report, Max and Stacy discuss the electric car boom driving a resource boom in Australia . . . and the biggest mines are now being acquired by Chinese companies. In the second half, Max interviews Gerald Celente of TrendsResearch.com about paradigm shifts: from cryptocurrencies to electric cars.  [...]

Commentary: "Max Keiser Was “Afraid For His Safety” Following Threats From Regulators In London" [08/12/17] [5:22] "During an interview Josh Sigurdson conducted with Max Keiser of The Keiser Report on RT, Max spoke on why he was no longer doing the show in London, but instead traveling to different places with Stacy Herbert to shoot the show on location. Max first shot his show from Paris and then London with the incredible view we all remember, but according to Keiser, things weren’t as good as they seemed. Max was threatened by regulators and when asked by Josh what he was threatened with, Max said, “They were threatening in a very belligerent manner that made us feel as if our safety was not exactly secure. On behalf of some energy companies (mainly) Ofcom which is their regulator in the UK, they work with corporations to stifle speech. In the UK they’re trying to get fracking in in a big way. The biggest group of activists and journalists that have been murdered over the past ten years have been those in the environmentalist movement. The ecological warriors if you will. People say journalists are getting killed in this country or that country but the biggest group has been environmentalists. They’ve been killed. Hundreds of them.” [...] This is the first time Max has dug into this problem publicly and it’s startling news. Ofcom (The Office Of Communications) is a government mandated regulatory authority for the broadcasting, telecommunications and postal industry in the UK. Ofcom tends to have the final say over media mergers, buyups and most importantly, what is said on television period. Max Keiser speaks on the lack of free speech in Britain and why he has traveled to new places to film his show.[...]"  

MSM: "Look Out Manhattan - Chinese Foreign Real-Estate Spending Plunges 82%" [08/12/17] Printer Friendly Version "Earlier this month, Morgan Stanley warned that commercial real estate prices in New York City, Sydney and London would likely take a hit over the next two years as Chinese investors pull out of foreign property markets. The pullback, they said, would be driven by China’s latest crackdown on capital outflows and corporate leverage, which they argued would lead to an 84% drop in overseas property investment by Chinese corporations during 2017, and another 18% in 2018. [...]" 

Commentary: "Military Industrial Complex Hit Highest Stock Prices Ever as Govt Hypes North Korea War" [08/11/17] Printer Friendly Version "Feckless boasts of military might and icy vows to annihilate one another might not necessarily prove war between the U.S., North Korea, and their allies is nigh, but the monumen tal increase in stocks of weapons and defense manufacturers — the economic fingerprints a preparation for a colossal military endeavor — just might. “North Korea best not make any more threats to the United States,” President Trump railed yesterday. “They will be met with fire and fury like the world has never seen.” [...] If, as legendary author John Steinbeck posited, “all war is a symptom of man’s failure as a thinking animal,” than the altogether avoidable rush for violent, physical confrontation with North Korea — currently unfolding by the hour — could easily be deemed foolishness of the highest order. After all, when nations resort to verbal sparring over the size and force of one another’s … militaries, it’s difficult not to picture world leaders as children hurling insults in a sandbox — a disturbing mental image only worsened by the fact Trump and perhaps Kim hold keys to arsenals with nuclear capabilities never before seen on Earth.[...]"

Commentary: "World Markets Slide Spooked By Latest N.Korea Statement; Dollar, Gold, Oil Jump" [08/11/17] Printer Friendly Version "European and Asian market and S&P futures have resumed their slide, as geopolitical tensions between North Korea and the U.S. spiked again overnight after Pyongyang responded to the latest set of warnings by Trump, revealing a plan to fire 4 ballistic missiles at Guam by mid-August. Gold gains for a third day while Brent rose above $53.  [...]" 

Commentary: "US Credit Card Debt Surpasses Financial Crisis Record" [08/09/17] Printer Friendly Version "Who would have expected that today's otherwise boring monthly consumer credit report would be the day's most exciting event. Well, moments ago the monthly update from the Federal Reserve confirmed that as of the end of June, total revolving (i.e. credit card) credit rose to $1,021.7 billion, an increase of $4.1 billion on the month, and a new all time high, taking out the previous record high set during the summer of 2008. Coupled with the monthly $8.3 billion increase in non-revolving credit, which also rose to an all time high of $2,834.1 billion... ... means that total consumer credit in June increased by $12.4 billion, slightly less than the $13.9 billion expected and modestly less than the $18.4 billion increase in May, to $3,855.8 billion, also a record high. Taking a closer look at the quarterly update in non-revolving debt, we find that for another consecutive quarter, both student and auto loans hit record highs, of $1.450 trillion and $1.131 trillion respectively, although there does appears to be a modest slowdown in credit issuance for these two largest categories.[...]"  

Commentary: "Russia Responds To US Sanctions By Intensifying Effort To Dump The Dollar" [08/09/17] Printer Friendly Version "Following new sanctions against Russia that President Donald Trump signed into law last week, Moscow responded Monday by announcing Russia will speed up work on reducing the country’s dependence on Western payment systems and the U.S. dollar in general, according to Russia’s state-run RIA Novosti news agency. “We will, of course, intensify work related to import substitution, reduction of dependence on U.S. payment systems, on the dollar as a settling currency and so on. It is becoming a vital need,” said Deputy Foreign Minister Sergei Ryabkov on Monday, as cited by RIA.[...]"  

Concepts and Practices: "The Currency Paradox" [08/08/17] Printer Friendly Version "It has long been believed that Capitalism is the last economic system. It has triumphed over its rivals, socialism and communism, and has now come to define modern society. Many believe that the religion of Adam Smith was the culmination of all of our economic experiments. To many, not only is Capitalism the best economic system that humanity has ever devised, it is the best that it will ever devise. About five years ago, I decided to challenge that premise. An idea had occurred to me which ultimately germinated into a system. For two years, I let the idea gestate, examined it from every angle which I could conceive. Finally, in 2014, I was able to bring the concept to fruition. In May, 2014, I published an 14,500-word essay titled The Currency Paradox, a work of economic philosophy. But, more significantly, it presented a concept of incredible audacity… An economic system that could viably replace Capitalism. [...]" 

Commentary: "Australia’s Biggest Bank Facing Trillion Dollar Fines For Money Laundering" [08/07/17] Printer Friendly Version "Even the Commonwealth Bank’s staunchest critics wouldn’t have predicted this one. This is the bank potentially blowing itself up. CBA is facing fines of about a trillion dollars for nearly 54,000 breaches of Australia’s money-laundering laws dating back to 2012. A trillion dollars, which is a thousand billion. About seven times Commonwealth Bank’s market value. If it comes to that, it simply won’t be able to pay. According to the money-laundering watchdog, AUSTRAC, “the effect of CommBank’s conduct in this matter has exposed the Australian community to serious and ongoing financial crime”. [...] It doesn’t get any worse than this. It’s not a financial planning scandal where tens of thousands of customers get ripped off blind, and the bank makes millions of dollars out of them. Or CBA overcharging its customers by more than $100 million. It’s not CommInsure refusing to pay out legitimate claims from people with terminal illnesses, saving the bank millions. Banks are meant to be the watchdog for suspicious activity involving criminals and money. For example, in the current climate it’s a key plank in the fight against terrorism. To abrogate that responsibility is beyond belief. And yet, if Commonwealth Bank is true to form, no senior executives will be held to account for this latest scandal. That is, sacked.[...]  

Social Predation: "UK Ready to Pay EU Up to $47 Bln Under Brexit Divorce Bill - Reports" [08/07/17] Printer Friendly Version "The United Kingdom is ready to pay the European Union up to 36 billion pounds ($47 billion) in accordance with London's financial obligations which are a result of its EU membership, local media reported Saturday citing government sources. According to The Telegraph newspaper, such an offer in the only way out from the current deadlock in Brexit negotiations with Brussels.[...]"  Note: The EU was a fraudulent collectivity scheme perpetrated by unelected sequential bureaucrats to generate exorbitant salaries for 100,000 EU bureaucratic socially predatory leeches. The EU could do little if the UK said no.

MSM: "Swiss Banks Paid Out €1 Billion In Negative Interest Rates In The First Half" [08/06/17] Printer Friendly Version "The Swiss National Bank has been charging a 0.75% fee on large deposits at the central bank since January 2015, a core policy aimed at weakening the Swiss franc and boost the velocity of money. The negative rate has been a burden for banks, especially at a time when wealthy clients are still keeping more than a fifth of their holdings in cash despite buoyant financial markets, recent earnings at the biggest private banks show. [...] With global markets at all time highs, and with cash levels stubbornly refusing to go down, the most likely outcome is that at the first whiff of trouble, cash holdings will surge right back up to crisis level, forcing the SNB to unveil even more draconian negative rates, or to abandon its NIRP policy altogether and join the rest of the world in pursuing "hawkish" policies. How that will impact the recently plunging Swiss Franc is unclear. [...]" 

Commentary: "No, You Can Not Audit The Gold" [08/05/17] Printer Friendly Version "Gold repatriation has been on the radar, some days more than others, for the better part of the past 5 years. The big news was Germany wishing to repatriate some of their gold from the Federal Reserve Bank New York (FRBNY) and Swiss National Bank. As you might recall, the big news was it would take the FRBNY 7 full years to gather, process and ship a mere 300 tons of gold out of the New York vault and send to Germany. Very few people understood why it would take so long and, to this day, it makes no sense. Germany has since claimed they have received all the gold requested and are currently satisfied. Peter Boehringer, the architect of the German gold repatriation movement in Germany, is not satisfied at all having not seen one bar, one serial number or any hard evidence proving the German gold has been returned. [...] There is a very good reason why Mr. Boehringer is not satisfied. Then we learned the physical gold that was being repatriated to Germany was not physical gold at all and that Germany’s Bundesbank was actually selling gold in order to make gold coins!! The repatriated gold was merely a line on a ledger sheet!! Which begs the question – Why would it take 7 years to create a ledger entry? Two set of books, three sets of books, one-hundred eighty sets of books? What could possibly have delayed this transaction and why were these people not forthcoming with the appropriate information from the beginning? Lies, deceit and propaganda – that’s why. Soon after Germany made their request, Hugo Chavez, President of Venezuela at the time, who has since died of an apparent heart attack, made a lot of noise regarding the return of 140 tons of gold from FRBNY. The gold was returned, in fairly short order, to much fanfare in Venezuela. The gold that was returned has since been sold/leased to Goldman Sachs in an effort to curtail the currency crisis that erupted soon after Venezuela received their gold. Hmmmm. Venezuela began experiencing a currency crisis immediately after receiving their gold from the FRBNY? You don’t say?" A few days ago the gold repatriation scheme took another strange turn and opened the door for even more questions about what is happening with all this supposed gold moving from one country to another. It is beginning to look like whoever currently has the gold is not moving it from the “host” country to the other [...]" 

Commentary: "How To Destroy An Economy - India's New Tax System Is "Mind-Bogglingly Inane" [08/04/17] Printer Friendly Version "Background for this story started on November 8, 2016, when Modi stunned the country with an announcement that 500-rupee ($7.30) and 1,000-rupee notes, which account for more than 85 percent of the money supply, would cease to be legal tender immediately.  For details, please see Cash Chaos in India, 86% of Money in Circulation Withdrawn; Cash Still King in Japan. The crackdown on cash has hurt the poor the most, and likely the richest the least. Nonetheless, Modi has widespread popular support. Modi’s latest set of mandates has small businessmen caught in the crossfire. [...] “IB” emailed a lengthy document describing new rules. What follows is a short list of three key points that I condensed from the document. The government will not allow Input Tax Credit on GST paid to vendors if the vendors do not pay their own taxes. The issue here is the Modi is forcing the role of tax-enforcement on businesses who buy goods for resale. Tax payments are required every month. For all cash businesses, there is no problem. There is a huge problem for those who have to pay taxes on receivables, in advance, when the business owners might not even get paid. Liquidity will kill many small businesses. Modi now wants three tax filings every month plus an annual tax return making it 37 overall. Currently, businesses file service tax returns twice in a year while they pay their taxes every quarter. Now with GST, small businesses have to file 3 returns every month, month on month, year on year, with fines stipulated for non-compliance. [...] This is the path that populist fools take to gain control and destroy economies. When tax collections actually go into reverse as businesses fail, Modi will come up with another set of ill-advised reforms, perhaps a total ban on cash. All it takes is a Congressional majority and Modi can and will do what he wants. In all likelihood, Modi’s enemies will soon be silenced for the “good of society”.[...]"  Note: Best place to experiment with new global programs is in a country with a billion minions. See November 2016 archives for stories about the Indian cash scheme mentioned above.

Commentary: "How Banks Hurt The Real Economy - FDIC's Hoenig To Senate" [08/04/17] Printer Friendly Version "When tighter regulations were imposed on the banks after the Financial Crisis, the largest among them, the very ones that threatened to bring down the financial system, began squealing. Those voices are now being heard by Congress, which is considering deregulating the banks again. In particular, they claim that current capital requirements force banks to curtail their lending to businesses and consumers, and thus hurt the economy. Nonsense! That’s in essence what FDIC Vice Chairman Thomas Hoenig told Senate Banking Committee Chairman Mike Crapo and the committee’s senior Democrat, Sherrod Brown, in a letter dated Tuesday, according to Reuters. The senators are trying to find a compromise on bank deregulation. If banks wanted to increase lending, they could easily do so without lower capital requirements, Hoenig pointed out. Rather than blowing their income on share-buybacks or paying it out in form of dividends, banks could retain more of their income, thus adding it to regulatory capital. Capital absorbs the losses from bad loans. Higher capital levels make a bank more resilient during the next crisis. If there isn’t enough capital, the bank collapses and gets bailed out. But banks that increase their capital levels through retained earnings are stronger and can lend more. Alas, in the first quarter, the 10 largest bank holding companies in the US plowed over 100% of their earnings into share buybacks and dividends, he wrote. If they had retained more of their income, they could have boosted lending by $1 trillion.[...]" 

Commentary: "There Is Only One Empire: Finance" Charles Hugh Smith [08/03/17] Printer Friendly Version "There’s an entire sub-industry in journalism devoted to the idea that China is poised to replace the U.S. as the “global empire” / hegemon. This notion of global empire being something like a baton that gets passed from nation-state to nation-state is seriously misleading, in my view, for this reason: There is only one global empire: finance. China and the U.S. both exist within the Empire of Finance. Virtually every mercantile nation with access to global markets lives, works and thrives/dies within the Empire of Finance. Every nation that allows capital to flow into its economy is subservient to the Empire of Finance. Every nation with capital and debt markets exposed to (or dependent on) global financial flows is just another fiefdom in the Empire of Finance. China has thrived within the Empire of Finance by creating more debt and at a faster rate of expansion than any other fiefdom.  China has brought 20 years of future growth and income forward, and eventually that vein of “wealth” runs out as time advances into the strip-mined future. The same can be said of all nations that have borrowed heavily from future growth and income to fund consumption/GDP “growth” today.[...] The Empire of Finance has few requirements for hegemony in its realm, but they are big ones. 1. If you want your national currency to act as a global reserve currency (or the global reserve currency), you must run permanent large trade deficits to export your currency in size to the rest of the world. This is the essence of Triffin’s Paradox, which I have covered many times: Understanding the “Exorbitant Privilege” of the U.S. Dollar (November 19, 2012) and Triffin’s Paradox Revisited: Crunch-Time for the U.S. Dollar and the Global Economy(April 5, 2016) 2. Your national currency must float freely in the global marketplace and be liquid enough to trade $1 to 2 trillion per day in global foreign exchange (FX) markets. 3. Your sovereign debt/bonds must float freely in the global credit/debt marketplace and be liquid enough to trade in size (tens of billions of dollars) daily. 4. Global capital must be free to flow in and out of your currency, debt, assets and economy without restriction. (Ease of capital flow is the core of liquidity, risk management, and profitability.) Any nation-state that meets these four requirements is fully exposed to a global loss of faith in its economy, debt, balance of payments and currency. The Empire of Finance is a harsh master; any nation-state that wants to secure the privileges of hegemony must first be willing to accept the risk of full exposure to skittish global markets and capital flows. Nothing wipes out “wealth” quite as quickly or effectively as a currency meltdown resulting from a sudden loss of faith / risk-averse capital exodus. Such a loss of faith or fear of loss quickly kills a nation’s ability to float more debt on the global marketplace. There’s an irony in all this talk of empire: only nation-states that operate within the unforgiving global Empire of Finance can establish hegemony in that Empire, but only nations that become autonomous autarkies (i.e. self-sufficient and independent of global markets, resources, credit, capital, etc.) can thrive outside the global Empire of Finance. There’s only one global empire, that of Finance. If you want global hegemony, you must accept the dominance of global finance and pay tribute. If you don’t want to submit to the empire, then you cannot be a global hegemon. [...]" Related: "We Need a Social Economy, Not a Hyper-Financialized Economy" Printer Friendly Version  

Commentary: "Corporate America Is Suddenly Freaking Out About Amazon" [08/02/17] Printer Friendly Version "Last night we showed the dramatic impact Amazon has had on the retail sector, where over $6 billion in retail debt has filed for Chapter 11 protection YTD ... a 110% surge compared to the first half of 2016, and pointed out that there was one recurring name mentioned among 2017's bankrupt retailers listed in the chart below: brands such as Gymboree, Payless, rue 21 and the Limited all cited Amazon affect as a contributor to their downfall. [...] It's not just the direct casualties of Amazon's encroachment on the retail sector that are having nightmares about Jeff Bezos' $500 billion juggernaut, however. As Bloomberg, which picked up on the topic of Amazon references this morning points out, "it's It isn’t the chaos in Washington or rising worker pay" that is keeping corporate America up at night: "It’s what Amazon.com Inc. is, or could be, doing to their business models." With the expanding online behemoth morphing from a retail category killer to a much broader enterprise that now competes with everything from high-end grocers to technology developers, "America has taken notice - and is increasingly concerned about the competition. So much so that Amazon’s overshadowed the Trump administration’s inability to claim a signature legislative achievement after more than six months in office." Bloomberg has quantified this by looking at the last 90 days of earnings calls and other corporate events such as investor days, which reveals a trend: "Amazon comes up a lot. It was mentioned a staggering 635 times over that time frame, while President Trump came up just 162 times and wages were discussed 111 times ... It’s become even more pronounced over the past 30 days, with Amazon garnering 165 mentions compared with 32 for Trump and 22 for wages."[...]"  Related: "The Amazon Effect: Retail Bankruptcies Surge 110% In First Half Of The Year" Printer Friendly Version "As Amazon flirts with a $500 billion market cap, letting Jeff Bezos try on the title of world's richest man on for size if only for a few hours, for Amazon's competitors it's "everything must go" day everyday, as the bad news in the retail sector continue to pile up with the latest Fitch report that the default rate for distressed retailers spiked again in July.  [...]"

Flashback: "The U.S. Has Wasted Over $14 Trillion On Warfare Over The Past Three Decades" [08/01/17] Printer Friendly Version "Speaking at the World Economic Forum in Davos, Switzerland, Jack Ma, the billionaire founder of Alibaba — the Chinese company that surpassed Wal-Mart as the world’s largest retailer in 2016 — said the United States has no one but itself to blame for its economic woes, and that much of the problem is rooted in wasteful spending on warfare. CNBC’s Andrew Ross Sorkin had asked Ma about his thoughts on the American economy and how it relates to China. Incoming President Donald Trump’s stance has consistently been anti-China — the former reality TV star has long accused the Asian superpower of siphoning U.S. jobs — and he and the trade team he’s putting together appear eager and willing to impose tariffs on Chinese goods. [...] “It’s not that other countries steal jobs from you guys. It’s your strategy. Distribute the money and things in a proper way,” Ma said, adding, “You’re supposed to spend money on your own people.” On the issue of military spending, the Chinese billionaire claimed the U.S. has wasted over $14 trillion on warfare over the past three decades — money that, again, could’ve been invested in domestic infrastructure and programs for the American populace. On Wednesday, as Anti-Media reported, Chinese President Xi Jinping gave a historic speech at the World Economic Forum in Davos in which he praised globalism and made a case for China as the world’s new economic leader. Speaking of globalization, Ma called it a “perfect” strategy, and pointed out that U.S. corporations have profited substantially from the system:[...]"  

MSM: "Vladimir Zhirinovsky Blames The US Banking System For The Current Crisis And Not Trump" [07/31/17] [11:13] "Vladimir Zhirinovsky, the leader of popular Russian opposition party the LDPR (formerly the Liberal Democratic Party of Russia), has given a wide reaching interview where he analysed the reasons behind and the repercussions of the new US sanctions. Zhirinovsky who is multi-lingual and holds advanced degrees in world history, stated that the grip of financial institutions over US politics have made the US political elites subservient to banking interests. He also stated that Congressional opposition to Donald Trump demonstrates that America is moving further from a strong Presidential system and closer to a parliamentary system. The Russian opposition veteran leader also stated that in the long term, America’s self-imposed isolation through globally unpopular sanctions will ultimately weaken the US Dollar, saying that the Dollar is the 21st century’s version of the ‘Iron Curtain’. Now watch, as Vladimir Zhirinovsky explains what America is doing to itself and the world. [...]"  Note: English sub-titles

Commentary: "EU Proposes Account Freezes To Halt Bank Runs" [07/30/17] Printer Friendly Version "European Union states are considering measures which would allow them to temporarily stop people withdrawing money from their accounts to prevent bank runs, an EU document reviewed by Reuters revealed. The move is aimed at helping rescue lenders that are deemed failing or likely to fail, but critics say it could hit confidence and might even hasten withdrawals at the first rumors of a bank being in trouble. The proposal, which has been in the works since the beginning of this year, comes less than two months after a run on deposits at Banco Popular contributed to the collapse of the Spanish lender. Giving supervisors the power to temporarily block bank accounts at ailing lenders is “a feasible option,” a paper prepared by the Estonian presidency of the EU said, acknowledging that member states were divided on the issue. EU countries which already allow a moratorium on bank payouts in insolvency procedures at national level, like Germany, support the measure, officials said. “The desire is to prevent a bank run, so that when a bank is in a critical situation it is not pushed over the edge,” a person familiar with German government’s thinking said. The Estonian proposal was discussed by EU envoys on July 13 but no decision was made, an EU official said. Discussions were due to continue in September. Approval of EU lawmakers would be required for any final decision. Under the plan discussed by EU states, pay-outs could be suspended for five working days and the block could be extended to a maximum of 20 days in exceptional circumstances, the Estonian document said. [...]" 

Commentary: "Wells Fargo Charged Some 800,000 Customers For Auto Insurance They Did Not Need" [07/29/17] Printer Friendly Version "One day after the NYT reported the latest major scandal involving Warren Buffett's favorite bank, in which the bank was busted less than a year after its miss-selling fraud cost the former CEO his job, revealing that the bank charged some 800,000 customers for auto insurance they did not need (with some still paying for it), the demands for resignation have arrived. In a statement from NYC Comtroller Scott Stringer, he demands that Wells Fargo must immediately "jump-start" necessary board change by replacing Chairman Stephen Sanger with a new independent chairperson following the latest "mismanagement" revelations.  [...]" 

Commentary: "Global Markets, Futures Slide Spooked By Poor Amazon Earnings, US Politics" [07/29/17] Printer Friendly Version "In Asia, a selloff in tech stocks prompted by Amazon's results sent benchmark indexes tumbling from Sydney to Hong Kong. The Swiss franc plunged for a fourth day versus the euro, reaching its weakest level since 2015. Oil prices held near eight-week highs hit on Thursday after key OPEC members pledged to reduce exports and the U.S. government reported a sharp decline in crude inventories.[...]"  Related: See below:

Hugh Jaynis Award: "Amazon Hosts Robotics Competition To Replace 230,000 Warehouse Workers" [07/29/17] Printer Friendly Version "In fact, just this weekend, Amazon will be hosting a robotics competition with 16 teams from around the world who will get a chance to show off their robotic "picking" technology for the chance to win a share of $250,000 in prize money." Note: Almost $1 for every one of the 230,000 jobs, and probably families, goes to the winner. Bezos plans to destroy these peoples lives for no reason other than his pathological need for greed and control. Related: "Amazon Profits Plunge Ending Bezos's Brief Time As World's Richest Man" Printer Friendly Version   

MSM: "Greece Arrests Russian "Mastermind" Behind $4 Billion Bitcoin Laundering Scheme" [07/28/17] Printer Friendly Version "Greek authorities have arrested a 38-year-old Russian man wanted in the United States on suspicion of masterminding a money laundering operation involving at least $4 billion through transactions in bitcoins. Reuters reports, a US jury indicted the man on Wednesday over the scheme which involved crimes ranging from computer hacking to drug trafficking. Alexander Vinnik was arrested in a small beachside village in northern Greece on Tuesday, according to local authorities, following an investigation led by the U.S. Justice Department along with several other federal agencies and task forces.[...]  U.S. officials described Vinnik in a Justice Department statement as the operator of BTC-e, an exchange used to trade the digital currency bitcoin since 2011. They alleged Vinnik and his firm "received" more than $4 billion in bitcoin and did substantial business in the United States without following appropriate protocols to protect against money laundering and other crimes. U.S. authorities also linked him to the failure of Mt. Gox, a Japan-based bitcoin exchange that collapsed in 2014 after being hacked. Vinnik "obtained" funds from the hack of Mt. Gox and laundered them through BTC-e and Tradehill, another San Francisco-based exchange he owned, they said in the statement. US prosecutors working with the Financial Crimes Enforcement Network unsealed a 21-count indictment against Vinnik and BTC-e late Wednesday, alleging that he used the exchange to help launder money for some of the most notorious criminals in bitcoin history, including the Mt. Gox hackers. Vinnik is facing 17 counts of money laundering and two counts of engaging in unlawful monetary transactions, while he and BTC-e, through a holding company called Canton Business Corp., are each facing one count of operating an illegal money transfer service. The site is facing a $110 million fine from FinCEN, while Vinnik is being fined $12 million. If convicted on all counts, the Russian-born Vinnik could serve up to 55 years in a US prison, according to CoinDesk. Until now, little has been known about BTC-E, which CoinDesk described as the digital-currency market’s “murkiest exchange long suspected of enabling criminal activity.” In the indictment, prosecutors for the Northern District of California claim that BTC-e “functioned as the exchange of choice to convert digital currencies like bitcoin to fiat money for the criminal world, especially by those who committed their crimes online.”[...]" 

MSM: "$350 Trillion In Securities In Limbo: LIBOR To Be Phased Out By 2021" [07/28/17] Printer Friendly Version "Unofficially, Libor died some time in 2012 when what until then was a giant "conspiracy theory" - namely that the world's most important reference index, setting the price for $350 trillion in loans, credit and derivative securities had been rigged for years - was confirmed. Officially, Libor died earlier today when the top U.K. regulator, the Financial Conduct Authority which regulates Libor, said the scandal- plagued index would be phased out and that work would begin for a transition to alternate, and still undetermined, benchmarks by the end of 2021. As Andrew Bailey, chief executive of the FCA, explained the decision to eliminate Libor was made as the amount of interbank lending has hugely diminished and as a result “we do not think markets can rely on Libor continuing to be available indefinitely." He is right: whether as a result of central banks effectively subsuming unsecured funding needs, or simply due to trader fears of being caught "red-handed" for simply trading it, the number of transactions directly involving Libor have virtually ground to a halt. According to the WSJ, "in one case banks setting the Libor rate for one version of the benchmark executed just 15 transactions in that currency and duration for the whole of 2016."  [...] So as the countdown to 2021 begins, what replaces Libor is not the only question: a bigger problem, and perhaps the reason why Libor was so irrelevant since the financial crisis, is that short-term funding costs since the financial crisis were virtually non-existent due to ZIRP and NIRP. Now that rates are once again rising, the concern will be that not does a replacement index have to be launched that has all the functionality of Libor (ex rigging of course), but that short-term interest rates linked to the Libor replacement will be inevitably rising. And, for all those who follow funding costs and the upcoming reduction in liqiduity in a world of hawkish central banks, this means that volatility is guaranteed. In other words, this forced transition is coming in the worst possible time. Then again, as many have speculated, with the next recession virtually assured to hit well before 2021, it is much more likely that this particular plan, like so many others, will be indefinitely postponed long before the actual deadline.[...]"  

Commentary: "Central Bankers 'Are' The Crisis" [07/27/17] Printer Friendly Version "If there’s one myth - and there are many - that we should invalidate in the cross-over world of politics and economics, it‘s that central banks have saved us from a financial crisis. It’s a carefully construed myth, but it’s as false as can be. Our central banks have caused our financial crises, not saved us from them. It really should -but doesn’t- make us cringe uncontrollably to see Bank of England governor-for-hire Mark Carney announce -straight-faced- that: “A decade after the start of the global financial crisis, G20 reforms are building a safer, simpler and fairer financial system. “We have fixed the issues that caused the last crisis. They were fundamental and deep-seated, which is why it was such a major job.” Or, for that matter, to see Fed chief Janet Yellen declare that there won’t be another financial crisis in her lifetime, while she’s busy-bee busy building that next crisis as we speak. These people are now saying increasingly crazy things, and that should make us pause. Central banks don’t serve people, or even societies, as that same myth claims. They serve banks. Even if central bankers themselves believe that this is one and the same thing, that doesn’t make it true. And if they don’t understand this, they should never be let anywhere near the positions they hold. You can pin the moment central banks went awry at any point in time you like. The Bank of England’s foundation in 1694, the Federal Reserve’s in 1913, the ECB much more recently. What’s crucial in the timing is where and when the best interests of the banks split off from those of their societies. Because that is when central banks will stop serving those societies. We are at such a -turning?!- point right now. And it’s been coming for some time, ‘slowly’ working its way towards an inevitable abyss. Over the past few years the Automatic Earth has argues repeatedly, along several different avenues, that American society was at its richest between the late 1960s and early 1980s.  [...]"  

Concepts and Practices: "Rothschild Controlled Media Outlet In 1988: World Currency By 2018" [07/26/17] Printer Friendly Version "The Economist magazine published an article almost thirty years ago, discussing the prospect of a world currency that should be expected around the year 2018. The 1988 article foreshadows a methodical movement towards a centralized world currency that we have, in many ways, seen play out over the past few decades. One must also keep in mind that the controlling interest of The Economist is held by the powerful Rothschild family, who regard themselves as the “custodians of The Economist magazine’s legacy.” In essence, the magazine operates as a quasi-propaganda arm for the Rothschild banking empire and related businesses and, is in many ways, meant to prime the pump of public opinion for the globalist agenda to be implemented. The excerpt below appeared in the print magazine on January 9, 1988, in Vol. 306, pp 9-10: "THIRTY years from now, Americans, Japanese, Europeans, and people in many other rich countries, and some relatively poor ones will probably be paying for their shopping with the same currency. Prices will be quoted not in dollars, yen or D-marks but in, let’s say, the "phoenix" (crypto currency?) The phoenix will be favoured by companies and shoppers because it will be more convenient than today’s national currencies, which by then will seem a quaint cause of much disruption to economic life in the last twentieth century .... As the next century approaches, the natural forces that are pushing the world towards economic integration will offer governments a broad choice. They can go with the flow, or they can build barricades. Preparing the way for the phoenix will mean fewer pretended agreements on policy and more real ones. It will mean allowing and then actively promoting the private-sector use of an international money alongside existing national monies. That would let people vote with their wallets for the eventual move to full currency union. The phoenix would probably start as a cocktail of national currencies, just as the Special Drawing Right is today. In time, though, its value against national currencies would cease to matter, because people would choose it for its convenience and the stability of its purchasing power. The alternative – to preserve policymaking autonomy- would involve a new proliferation of truly draconian controls on trade and capital flows. This course offers governments a splendid time. They could manage exchange-rate movements, deploy monetary and fiscal policy without inhibition, and tackle the resulting bursts of inflation with prices and incomes polices. It is a growth-crippling prospect. Pencil in the phoenix for around 2018, and welcome it when it comes." [...]   The alternative – to preserve policymaking autonomy- would involve a new proliferation of truly draconian controls on trade and capital flows. This course offers governments a splendid time. They could manage exchange-rate movements, deploy monetary and fiscal policy without inhibition, and tackle the resulting bursts of inflation with prices and incomes polices. It is a growth-crippling prospect. Pencil in the phoenix for around 2018, and welcome it when it comes." [...] Only ten years later, in 1998, The Economist was once again engaging the public in an effort to forward the globalist agenda, with an article entitled “One world, one money." [...] Very much in line with the 1988 piece, the publication attempts to explain why a much more centralized and controlled system would be beneficial to the global economy, while wholly ignoring the fact that such a centralized global currency would be a massive coup for the international banking cartel, and the Rothschild banking empire’s financial bottom line. Additionally, it must be noted that the creation of a global currency would give an inordinate amount of geopolitical capital to unelected international bankers, and subsequently take power away from the citizens of each nation and their respective governmental representatives.[...]"  Note: I just don't see their projection happening the way they think it will ... 

Commentary: "Social Security: The 14th Amendment And “Odious Debt”" Dr. Nayvin Gordon [07/25/17] Printer Friendly Version "The Republican Party prepares to violate the 14th Amendment to the US Constitution: Social Security — the 14th amendment and “odious debt”. For decades the working people have been paying millions more than was needed into Social Security and for years the excess money has been borrowed by the government. Presently there is almost $3 trillion owed by the government to the Social Security Trust Fund. The Republican Party now controls the government and has a budget plan that will give less than was promised to millions of people who have paid excess into Social Security for years.  This proposed budget is, in fact, a default on the debt owed to the Social Security Trust Fund and the people of the United States. The proposed Republican budget cut to Social Security is a violation of the 14th Amendment to the US Constitution. The 14th amendment reads as follows: “the validity of the public debt of the United States, authorized by law, includes debts incurred for payments of pensions….. shall not be questioned.” [...] For decades the politicians have not only borrowed from Social Security to run the government, but 70% of the national debt has been borrowed from banks, financial institutions, corporations and rich individuals. The politicians borrowed because instead of taxing the rich banks and corporations, they cut their taxes. As a result, workers’ taxes and Social Security payments provide almost 90% of the federal government’s revenues.  Over decades the politicians have allowed major corporations to escape paying billions in taxes, they have given subsidies in the billions to corporations and agribusiness, and they have allowed tax breaks for the oil and gas companies in the billions of dollars.3 The Government has also spent trillions of dollars for multiple wars and on bailing out banks and insurance companies. Politicians have borrowed money and spent it on the military industrial complex. Over half the national budget goes to the military in spite of the fact that over the past 46 years the general population has been opposed to the government’s decision to spend so much money on the military, and have repeatedly indicated that they would rather the money be spent on social services, healthcare and education. [...] A 2014 study by Princeton University came to the conclusion that the majority of the American public actually has little influence over the policies the government adopts. The study concluded that “economic elites and organized groups representing business interests have substantial independent impact on US government policies while the average citizen have little or no independent influence.” Politicians now tell us that there is too much debt and they want to pay off the creditors rather than provide public service to the average citizen. This debt is clearly against the interests of the general population. This debt was obtained without the people’s consent and with the full awareness of the creditors. Thus this fulfills the International Legal Definition of an “odious debt”. We, the people have no obligation to pay and consider this debt invalid.[...]" 

Commentary: "Venezuela Will Be The First Sovereign Oil Producer To See An "All-Out Collapse" [07/24/17] Printer Friendly Version "Venezuela’s anti-government protests are growing increasingly violent, with the death toll from clashes between protesters and government forces that began in May topping 100. Despite the country’s increasing political instability, and US President Donald Trump’s half-serious threats of an invasion, President Nicolas Maduro has decided to press ahead with his vote to create a rubberstamp constituent assembly that will allow him to amend the country’s constitution. With the country’s finances looking ever more precarious, Bloomberg warns that that this decision could bring about the first collapse of a sovereign oil producer. Venezuela has the largest natural oil reserves of any country on Earth, yet the decline in oil prices that began in 2014, coupled with years of economic mismanagement, have been enough to bring the country’s economy to its knees. [...]"  Related: "Venezuelans Are Now Paying 1000x  More For US Dollars Than They Did In 2010" Printer Friendly Version

Commentary: "Australia Exports Record Amount Of Gold To China" [07/21/17] Printer Friendly Version "Are the Chinese getting close to announcing a new gold-backed currency? Well, if the record amount of Australian gold exports into China is an indicator, it may be close at hand. While the Chinese have been importing a lot of gold from Australia, it reached a new record high in 2017. According to the recently released data by the Australian Government June 2017 Resources and Energy Quarterly, Australia exported more gold to Hong Kong and China during the first quarter of 2017 than any other quarter in history. Australian gold exports to Hong Kong and China were 54% higher Q1 2017 versus the same quarter last year: Australia exported 57.4 metric tons (mt) of gold in Q1 2017 compared to 37.2 mt Q1 2016. What a difference in ten years. Australian gold exports to Hong Kong and China were nonexistent in 2008. However, after the U.S. and global market meltdown that year, China started to import more gold, especially since 2011. Furthermore, Australia is now exporting the majority of its gold to Hong Kong and China. For example, of the total 75 mt of Australian gold exports Q1 2017, 57.4 mt or 77% went to Hong Kong and China.[...] Now, what is even more interesting is that Australian exports more gold than they produce from their domestic gold mines. This is also true for the United States. Australia and the U.S. produced a combined 510 mt of gold in 2016, but their gold exports totaled 762 mt. Thus, these two countries exported nearly 50% more gold than they produced in 2016.[...]"  Related: See below: "Russia and China Bypassing Petrodollar — Preparing for Exclusive Trade in Gold" [07/17/17] 

MSM: "$10bn Cryptocurrency Devaluation In 24 Hours, Bitcoin Hit Hard" [07/18/17] Printer Friendly Version "Cryptocurrency investors have suffered heavy losses following a dramatic drop in the price of Bitcoin and Ethereum in recent days. Bitcoin fell to around $1,863 and Ethereum to around $133 over the weekend – 38 percent and 67 percent off their all-time high respectively. Bitcoin, in particular, suffered heavy losses since hitting a high of $3,018 on June 12. By Monday, Bitcoin had recovered slightly to $2,129 while Ethereum also rose to $176. The decline appears to be part of a wider trend across the market, with trade publication Coindesk reporting Sunday that the worth of all publicly traded digital currencies had fallen by a total of $10 billion in 24 hours over the weekend. [...]" 

  Commentary: "Russia and China Bypassing Petrodollar — Preparing for Exclusive Trade in Gold" [07/17/17] Printer Friendly Version "The formation of a BRICS gold marketplace, which could bypass the U.S. Petrodollar in bilateral trade, continues to take shape as Russia’s largest bank, state-owned Sberbank, announced this week that its Swiss subsidiary had begun trading in gold on the Shanghai Gold Exchange. Russian officials have repeatedly signaled that they plan to conduct transactions with China using gold as a means of marginalizing the power of the dollar in bilateral trade between the geopolitically powerful nations. This latest movement is quite simply the manifestation of a larger geopolitical game afoot between great powers. [...] Sberbank was granted international membership of the Shanghai exchange in September last year and in July completed a pilot transaction with 200 kg of gold kilobars sold to local financial institutions, the bank said. Sberbank plans to expand its presence on the Chinese precious metals market and anticipates total delivery of 5-6 tonnes of gold to China in the remaining months of 2017. Gold bars will be delivered directly to the official importers in China as well as through the exchange, Sberbank said. Russia’s second-largest bank VTB is also a member of the Shanghai Gold Exchange." To be clear, there is a revolutionary transformation of the entire global monetary system currently underway, being driven by an almost perfect storm. The implications of this transformation are extremely profound for U.S. policy in the Middle East, which for nearly the past half century has been underpinned by its strategic relationship with Saudi Arabia.[...] A report by the Centre for Research on Globalization clarifies the implications of these most recent moves by the Russians and the Chinese in an ongoing drive to replace the US petrodollar as the global reserve currency: [...]" 

Commentary: "Ron Paul Warns 'Cashless Society' Concept All About Authoritarians Clinging To Power" [07/17/17] Printer Friendly Version "The global dollar-based monetary system is in serious jeopardy, according to former Texas Congressman Ron Paul. And contrary to Fed Chairwoman Janet Yellen’s assurances that there won’t be another major crisis in our lifetime, the next economy-cratering fiat-currency crash could happen as soon as next month, Paul said during an interview with Josh Sigurdson of World Alternative media. Paul and Sigurdson also discussed false flag attacks, the dawn of a cashless society and the dangers of monetizing national debt. Paul started by saying Yellen's attitude scares him because "central bankers are always wrong - especially before a bust." [...] “There is a subjective element to when people lose confidence, and when is the day going to come when people realize we’re dealing with money that has no intrinsic value to it, we’re dealing with too much debt, too much bad investment and it will come to an end. Something that’s too good to believe usually is and it usually ends. One thing’s for sure, we’re getting closer every day and the crash might come this year, but it might come in a year or two.” “It’s a sign that the authoritarians are clinging to power so they can collect the revenues collect the taxes and make sure you’re not getting around the system. That’s what the cashless society is all about. But it won’t work in fact it might be the precipitating factor that people will eventually lose confidence when the crisis hits.[...]"

Commentary: "Desperate VISA Begs Merchants With $10,000 Bribe To Go Cashless" [07/15/17] Printer Friendly Version "A war on cash has surreptitiously and duplicitously come to pass, as Big Banks and Big Credit attempt to convince their millions of oft-captive customers to make the leap away from currency and into plastic — a surefire means of gaining access to more of your funds through repressive policies and monstrous fees. Writing a check as payment has been difficult for years, but the move away from currency to digitally-tracked plastic and online pay options has recently taken off — despite reluctance from customers and smaller businesses already wary of being bilked by guileless banks and slithery credit institutions. Given the sizable snub to the cashless utopia, touted as such by those who stand to profit handily, some credit card companies have opted to amplify pressure on merchants. [...] Reports the Wall Street Journal: "Visa Inc. has a new offer for small merchants: take thousands of dollars from the card giant to upgrade their payment technology. In return, the businesses must stop accepting cash. The company unveiled the initiative on Wednesday as part of a broader effort to steer Americans away from using old-fashioned paper money. Visa says it is planning to give $10,000 apiece to up to 50 restaurants and food vendors to pay for their technology and marketing costs, as long as the businesses pledge to start what Visa executive Jack Forestell calls a ‘journey to cashless.’  That relatively marginal incentive to businesses — from a company incidentally reaping billions each year in interest rates and an interminable list of astronomical fees — reeks of both insult and disingenuity. Businesses will generally choose the simplicity of cash and convenience for customers over unnecessarily meticulous tracking inherent to cashless transactions — which, additionally, don’t pass the litmus test of their advertised speed and ease."  And then there’s that whole, ‘Big Credit needs profit, too!’ factor. [...] As the Journal continues, “many merchants prefer cash because they don’t have to share the revenue with card companies. Credit-card interchange fees, which networks like Visa set and that merchants pay to the banks that issue their cards, are on average around 2% of the transaction amount, according to the National Retail Federation, the largest trade group that represents merchants in the U.S.” And, considering the tether around the neck a cashless society comprises for the vast, paycheck-to -paycheck majority — who are, of course, already drowning in debt — making transactions as anonymously as possible means less governmental scrutiny. [...]"  Related: "IMF Tells Governments How To Subvert Public Resistance Against Elimination Of Cash" [04/05/17] Printer Friendly Version "... The International Monetary Fund (IMF) in Washington has published a Working Paper on “de-cashing”. It gives advice to governments who want to abolish cash against the will of their citizenry. Move slowly, starting with seemingly harmless measures, is part of that advice.[...]"

Commentary: "The Face Of America's Pension Crisis" [07/13/17] Printer Friendly Version "Meet Tony. For years, Tony worked in a plant that manufactured industrial gases. He started working at the plant in 1979, joining the Teamsters after deciding, like many who worked there, that becoming part of the union, and participating in its pension plan, was a smart financial decision. The plant, which used processes that were dangerous in retrospect, according to Tony, eventually declined into technological obsolescence. Newer, safer processes became the standard for producing the gases that his plant produced. After a long career, he retired from the plant, and at 58 years old, he and his wife now work at Sam's Club and continue to save diligently for retirement through Wal-Mart's 401(k) program. It's a good thing Tony and his wife saved, and continue saving, because the pension he was promised when he started making contributions as a gas plant worker 38 years ago may not be available to him for much longer. In fact, his pension, part of the Central States Pension Fund, is facing a financial crisis of its own. He receives reminders of the pension's problems through frequent mailings. The fund most recently wrote him to say that it is in "critical and declining" status, a label ascribed to pension plans that are expected to be insolvent in as little as 10 to 20 years, but Central States could be insolvent in less than eight years, failing by 2025. If nothing is done, pension payments to participants could simply stop as the plan's assets slowly bleed out and government-organized pension insurance programs become insolvent under the burden of failed pension plans. [...] How the plan fell apart: The Central States Pension Fund covers workers and retirees from a variety of industries, but most of its retirees are truck drivers who worked for one of the thousands of trucking companies that once dominated American highways. Though the trucking industry is as important as it has ever been to the way goods are shipped, its economic fortunes have faded since 1980, when the industry was deregulated. The passage of the Motor Carrier Regulatory Reform and Modernization Act of 1980 removed many of the barriers that restricted competition and buoyed profits. The excess profits enjoyed by the trucking industry up until 1980 were more representative of a competition-free bubble than a normal competitive environment. An article written by Thomas Gale Moore, a senior fellow at the Hoover Institution at Stanford University, explained the unique protections afforded to the trucking industry by earlier legislation, which made them exempt from anti-monopoly laws."  "In 1948 Congress authorized truckers to fix rates in concert with one another when it enacted, over President Truman's veto, the Reed-Bulwinkle Act, which exempted carriers from the antitrust laws." Alongside deregulation and decreased profitability, declining union membership also weighed on Central States and other pension funds' participation levels. Whereas as many as 60% of truckers in regulated corners of the industry were union in the 1970s, only 12% were union members in 2006. Non-unionized transportation outfits were enabled by deregulation to publish lower rates and compete on price, scoring more business from costlier unionized service providers. After all, trucking is largely a commodity; price is paramount to winning business. And non-unionized shops simply had the better price, which was a big problem for pension plans that rely on union participation.[...]" Related: See below

FLASHBACK 2016:  "Senators Vow to ‘Use Any Means Necessary’ to Ensure Taxpayer Bailout of Private Union Pension Plan" Dec 2016 Printer Friendly Version "As Congress closes up shop for 2016, a group of four Democratic senators is determined to “use whatever means necessary” to secure a special-interest taxpayer bailout for the United Mine Workers of America union. According to the senators, those “means” will include “blocking other bills” until the bailout is secure. The UMWA represents roughly 100,000 active and retired coal miners. After decades of failing to set aside sufficient funds to keep the promises it made, the UMWA’s members are on track to see their pension benefits reduced when the union’s plan becomes insolvent around 2025. Never before in history has the U.S. government bailed out a private pension plan. That’s because bailouts encourage more of the same reckless behavior that led to the bailout in the first place. If the federal government forces taxpayers to back up the promises made by private companies or unions, what incentive will those plans have to make good on their promises? If these senators—Joe Manchin, W.Va.; Sherrod Brown, Ohio; Bob Casey, Pa.; and Mark Warner, Va.—are successful in their stand to shift the UMWA’s $5.6 billion in broken pension promises onto taxpayers, they will set a precedent for future senators and members of Congress to do the same for failing pension plans in their states and districts. [...] Next up will be the Central State Teamsters—a trucking union representing nearly 400,000 active and retired workers across dozens of states and hundreds of congressional districts. It has promised $36 billion more in pension benefits than it can afford to pay and it will become insolvent at about the same time as the UMWA plan, around 2025. [...] After that will come any number of the other roughly 1,400 private, union-run pension plans across the U.S. A whopping 74 percent of these plans are less than 50 percent funded, and less than 1 percent are fully funded. Nationwide, these union-run pension plans have racked up over $600 billion in unfunded promises. But that’s nothing compared to public-sector state and local pension plans, which owe an estimated $5.6 trillion in unfunded pension promises. A private-sector pension bailout would all but ensure a public sector one as well. [...]" 

MSM: "China, Russia Alliance Deepens Against American Overstretch" [07/12/17] Printer Friendly Version " ... Ahead of the G20 meeting last week China’s President Xi Jin-ping met with President Putin in Moscow. This was Xi’s sixth visit to Russia since becoming president, and the third meeting between the two heads of states in the last six months. Neither country has ever referred to the other as an ally, but the meeting was strategic in terms of the Sino–Russian comprehensive relationship, both politically and economically. During the two day meeting, the two countries signed deals which will allow Russia to bypass Western sanctions by China agreeing to fund investments in Russia worth billions of dollars. Both the Russian Direct Investment Fund (RDIF), a sovereign wealth fund and VEB, Russia’s state development bank are subject to US sanctions. But both have now signed deals with China Development Bank. The deals will will finance infrastructure and development projects as well as a new innovation fund. The purpose of the US and Western sanctions was to cut Russia off from long term financing in the U.S. and EU. These new deals will be set up in Russia and China’s own currencies and are a demonstration to the West that Russia cannot be cut off from major trading partners and the global market place and the US no longer has the means or power to do so. It is worth reminding readers at this point of Putin’s comments last year that both “Russia and China need to secure their gold and foreign reserves.” It’s unlikely Putin was speaking out of turn by mentioning China’s monetary policy. Both countries central banks continue to increase their gold reserves and are accumulating large gold in anticipation of currency wars reigniting in the coming months. Concerns about systemic risk and the coming devaluation of the dollar, euro and other major currencies has led to ongoing diversification into gold bullion by large creditor nation central banks such as Russia and China. Influential state media Chinese daily, the Global Times, reported last Monday that China and Russia have decided to deepen their ties because they are “fed up with Washington’s pursuit of hegemony.” The US and other Western countries are yet to pass comment on these new deals. It is likely that they are each treading carefully, fully aware that they need Russia and China on side when it comes to more pressing matters such as Syria and North Korea. Whilst neither Russia nor China mentioned the US in relation to the two countries’ meetings, nor were they mentioned in joint statements, it was easy enough to connect the dots in terms of where both Putin’s and Xi’s concerns lie. [...]"  

Concepts and Practices: "New Bill Would Require People To Disclose Cryptocurrency Holdings At The Border" [07/11/17] Printer Friendly Version "A new bill introduced in late May in the United States Senate would require people entering or leaving the United States with $10,000 or more in cryptocurrency to declare their holdings to US Customs and Border Protection agents. The bill has been introduced in the 115th Congress as S.1241, and known as the Combating Money Laundering, Terrorist Financing, and Counterfeiting Act of 2017. Currently this regulation is already applied to cash and money orders. The bill’s prime sponsor is Republican Senator Chuck Grassley of Iowa. The bill has some bipartisan support, co-sponsors of the bill include Democratic Senator Dianne Feinstein of California, Democratic Senator Sheldon Whitehouse of Rhode Island, and Republican John Cornyn of Texas. [...]  Cryptocurrencies are not the only thing which would be subject to disclosure to border agents under the new bill, as prepaid mobile phones, coupons, and gift vouchers would also be subject to disclosure. Failure to disclose cryptocurrency holdings worth over $10,000 would be punishable by criminal penalties that include up to 10 years in prison, as well as be subjected to civil asset forfeiture. Civil asset forfeiture is a process which enables government to take property without a criminal conviction, and sometimes even without an arrest. Civil asset forfeiture is different from criminal asset forfeiture in that under civil asset forfeiture your property can be seized without being convicted of a crime. Law enforcement agencies are able to keep what they seize under the civil asset forfeiture process. Many people have called for the reform of asset forfeiture laws, and some privacy activists have called the practice of civil asset forfeiture unconstitutional, a violation of the 4th amendment’s protection from unreasonable searches and seizures. [...] The bill also expands the surveillance state by authorizing customs agents to conduct wiretaps on people that they suspect may be transporting “excess” cryptocurrency holdings. If the bill is enacted, within 18 months the Secretary of Homeland Security and the Commissioner of the US Customs and Border Protection agency will deliver a report to Congress outlining their strategy for detecting and interdicting cryptocurrencies, as well as an assessment of what infrastructure is needed to implement their strategy. Under the proposed legislation, cryptocurrency exchangers like Shapeshift, as well as coin tumbler services, would be defined as financial institution under the Bank Secrecy Act. The Bank Secrecy Act is an anti-money laundering law which as enacted in 1970 and was amended by Title III of the USA PATRIOT Act. [...] An almost identical version of this legislation was introduced in 2011 and failed to pass. It is likely the legislation was originally intended to target centralized digital currency exchanges such as Liberty Reserve, which was shut down by the federal government in 2013. The legislation does not define “digital currency” or differentiate between centralized and decentralized digital currency, unlike FinCEN and the Department of Treasury, which has clearly defined terms for “centralized virtual currency” and “decentralized virtual currency”. Many cryptocurrency advocates say the bill is unnecessary as FinCEN has already released guidance and regulations on cryptocurrency. “While we encourage thoughtful and meaningful study of the prevention of cross-border financial crime, the storage of virtual currency carries different and complex considerations than those attributable to prepaid access,” President of the Chamber of Digital Commerce Perianne Boring told CoinDesk. The Chamber of Digital Commerce and Coin Center, two of the biggest lobbying firms in Washington DC that advocate for cryptocurrency, are currently in contact with legislators to discuss the bill. The bill is currently being considered in the Senate Committee on the Judiciary. Shortly before this bill was introduced in the United States Senate, the United States House of Representatives’ Homeland Security Committee’s Subcommittee on Counterterrorism and Intelligence began working on changes to a proposed bill by Representative Kathleen Rice of New York. Rep. Rice’s bill would call for the Under Secretary of Homeland Security for Intelligence and Analysis to create a threat assessment on how people could use cryptocurrencies to further terrorist activity. [...]" 

Commentary: "IMF Leaves Ukraine Without Any Money To Pay Debts" [07/10/17] Printer Friendly Version "The IMF has postponed the release of the next tranche for Ukraine, as reported today by Bloomberg. Should Vladimir Putin and Donald Trump be able to find a common language at the upcoming G20, the new IMF loans to Ukraine will no longer be able to be obtained. "The previous tranche was also delayed by more than six months. The delay is caused by the fact that Ukraine does not comply with the conditions of the memorandum, which were established, namely the implementation of land and pension reform. The government has already made it clear that before the parliamentary recess the relevant bills will not have time to navigate through the Verkhovna Rada,"- said Ukrainian economist, Vsevolod Stepaniuc. Ukrainian economist Alexander Okhrimenko also admits that the IMF funding could be terminated. "This year we have a very small repayment (for external debt), we need to pay off a billion dollars. A billion dollars the IMF has already given us. But the question is, what will happen next. For us, 2018-2019 are critical years. Next year we will have to pay $ 4.5 billion, and in 2019 - almost 9 billion dollars. Now that's scary." Trump announced that he would stop or drastically reduce funding for other countries. In America, this slogan is very popular - US taxpayers' money remain in the United States. For Americans, this is very important. Ed: It would seem that US taxpayers have been paying the price for the incoherent policy that the previous Obama administration committed in the Ukraine, in the interests of the few.  [...]"  Note: It's what the IMF does for a living.

Commentary: "Teachers, Firemen, College Endowments Enriched America’s Hedge Fund Billionaires" [07/10/17] Printer Friendly Version "Public pensions and college endowments are some of the biggest investors in hedge funds, investment vehicles that have made their managers some of the wealthiest people in the world.Middlemen funnel this public money into the hedge funds, as do funds of funds. All of them collect fees.Pensions could have been better off investing in cash than in hedge funds, largely because of the high fees investors pay hedge fund managers. Hedge funds haven’t met the expectations for endowments over the past several years, either. In the summer of 2015, Penn State’s endowment invested $50 million in Pershing Square Capital, a high-profile hedge fund run by New York City billionaire Bill Ackman. The endowment, one of the largest held by a university, invested as the fund was coming off years of stellar performance. Two years later, the fund has had a reversal of fortune. The Pershing Square International fund reported a loss of 16.6% in 2015 and a loss of 10.2% last year. The fund gained 1.83% through mid-June of this year. At those rates, a $50 million investment in 2015 would be worth about $38 million now. That doesn’t include annual fees, of about 1.5% of the assets (about $750,000 on the initial amount), paid to the hedge fund. [...]"  

Commentary: "How Greece Became A Guinea Pig For A Cashless, Controlled Society" [07/07/17] Printer Friendly Version "As Greece moves closer to becoming a cashless society, it is clear that the country’s attitude towards cash is reckless and dangerous. The supposed convenience of switching to a cash-free system comes with a great deal of risk, including needless overreach by the state. [...] Day by day, we’re moving towards a brave new world where every transaction is tracked, every purchase is recorded, the habits and preferences of everyone noted and analyzed. What I am describing is the “cashless society,” where plastic and electronic money are king, while banknotes and coins are abolished. “Progress” is, after all, deemed to be a great thing. In a recent discussion, I observed on an online message board regarding gentrification in my former neighborhood of residence in Queens, New York, the closure of yet another longtime local business was met by one user with a virtual shrug: “Who needs stores when you have Amazon?” This last quote is, of course, indicative of the brick-and-mortar store, at least in its familiar form. In December 2016, Amazon launched a checkout-free convenience store in Seattle—largely free of employees, but also free of cash transactions, as purchases are automatically charged to one’s Amazon account. “Progress” is therefore cast as the abolition of currency, and the elimination of even more jobs, all in the name of technological progress and the “convenience” of saving a few minutes of waiting at the checkout counter.[...] Still insist on being old-fashioned and stuck behind the times, preferring to visit brick-and-mortar stores and paying in cash? You may very well be a terrorist! Pay for your coffee or your visit to an internet cafe with cash? Potential terrorist, according to the FBI. Indeed, insisting on paying with cash is, according to the United States Department of Homeland Security, “suspicious and weird.” The European Union, ever a force for positive change and progress, also seems to agree. The non-elected European Commission’s “Inception Impact Assessment” warns that the anonymity of cash transactions facilitates “money laundering” and “terrorist financing activities.” This point of view is shared by such economists as the thoroughly discredited proponent of austerity Kenneth Rogoff, Lawrence Summer (a famed deregulator, as well as eulogizer of the “godfather” of austerity Milton Friedman), and supposed anti-austerity crusader Joseph Stiglitz, who told fawning participants at the World Economic Forum in Davos earlier this year that the United States should do away with all currency.[...] The International Monetary Fund (IMF), which day after day is busy “saving” economically suffering countries such as Greece, also happens to agree with this brave new worldview: [...] The IMF’s Greek experiment in austerity: [...] Global powers jumping on cashless bandwagon: [...] Cashless policies bode poorly for the future: [...]"  Note: Estimates are that "cash" only comprises 2% of 'dark money', so any claim that removing cash will 'prevent criminal activity' holds no water.

Commentary: "7 Fast Facts About The Economic Collapse Of Illinois" [07/04/17] Printer Friendly Version "The state of Illinois is in big trouble. In fact, they’re facing an economic collapse. Some pundits are calling them “The Venezuela of the United States.” They owe $14,711,351,943.90 in overdue bills. This does not count their day-to-day operating expenses – this is money that should have already been paid out, but wasn’t. Nearly 15 BILLION DOLLARS. Like every person who has ever spent more than they’re making with no regard for budget, things are starting to go downhill in an ever-growing avalanche of disasters. [...]"  Related: See below

Trends: "From Horrific To Catastrophic": Court Ruling Sends Illinois Into Financial Abyss" [07/03/17] Printer Friendly Version "First Maine, then Connecticut, and finally late on Friday, confirming the worst case outcome many had expected, Illinois entered its third straight fiscal year without a budget as Republican Governor Bruce Rauner and Democratic lawmakers failed to agree on how to compromise over the government’s chronic deficits, pushing it closer toward becoming the first junk-rated U.S. state. By the end of Friday - the last day of the fiscal year - Illinois legislators failed to enact a budget, and while negotiations continued amid some glimmers of hope and lawmakers planned to meet over the weekend, the failure marked a continuation of the historic impasse that’s left Illinois without a full-year budget since mid-2015, and which, recall, S&P warned one month ago will likely result in a humiliating and unprecedented downgrade of the 5th most populous US state to junk status. Then came the begging. According to Bloomberg, on Friday Illinois House Speaker Michael Madigan, a Democrat who controls much of the legislative agenda, pleaded with rating companies to "temporarily withhold judgment” as lawmakers negotiate. “Much work remains to be done,” the Democrat said on the floor of the House Friday, before the chamber adjourned for the day. “We’ll get the job done.” [...] Meanwhile, the state remains without a spending plan, its tax receipts and outlays mostly on "autopilot", leaving it with a record $15 billion of unpaid bills as it spent over $6 billion more than it brought in over the past year, and with $800 million in interest on the unpaid bills alone. The impasse has devastated social- service providers, shuttering services for the homeless, disabled and poor. The lack of state aid has wrecked havoc on universities, putting their accreditation at risk. However, in a "shocking" development, just hours remaining before the midnight deadline to pass the Illinois budget, and Illinois' imminent loss of its investment grade rating, federal judge Joan Lefkow in Chicago ordered Illinois to come up with hundreds of millions of dollars it owes in Medicaid payments that state officials say the government doesn’t have, the Chicago Tribune reported. Judge Lefkow ordered the state to make $586 million in monthly payments (from the current $160 million) as well as another $2 billion toward a $3 billion backlog of payments - a $167 million increase in monthly outlays - the state owes to managed care organizations that process payments to providers. While it is no secret that as part of its collapse into the financial abyss, Illinois has accumulated $15 billion in unpaid bills, the state's Medicaid recipients had had enough, and went to court asking a judge to order the state to speed up its payments. On Friday, the court ruled in their favor. The problem, of course, is that Illinois can no more afford to pay the outstanding Medicaid bills, than it can to pay any of its $14,711,351,943.90 in overdue bills as of June 30.[...]"  Related: "New Jersey Governor Issues A State Of Emergency Executive Order" Printer Friendly Version "In an attempt to shield those living in the Garden State from the problems their government created, the governor, Chris Christie, has now signed an executive order issuing a “state of emergency.” As speculation grows that New Jersey will soon follow in Illinois’ footsteps, the government is proving forecasters correct by their inability to pass a constitutionally mandated budget. Not only did New Jersey’s inability to pass a budget shut down the government (but not really, don’t worry, you’ll still be taxed and welfare checks will still go out) but it scared Christie enough to sign a state of emergency executive order. [...]" 

Commentary: "America's Death Throes" [07/01/17] Printer Friendly Version "China and Russia have already ditched the US dollar in their vast energy trade. Now China is leveraging Saudi Arabia to also abandon the greenback for oil sales. No wonder, it seems, that US policies are increasingly lashing out. [...] US global power depends on its presumed economic prowess and military force. With its economy in long-term decline, precipitated by the teetering dollar, the US rulers are relying increasingly on militarism to project power. That tendency is pushing the world to war. The challenge is to somehow steer the American military monster into a safe berth without eliciting a world war. The US decline is of historic proportions – on par with the demise of other past empires – and it stems from the looming collapse of the petrodollar system, which has given the US unprecedented privileges over the past decades since the Second World War. It is no coincidence that a surge in global tensions over recent years comes at a time when the American economy is staring into an abyss. The "key to the survival of the US economy as we know it" is the "status of the American dollar as the world's top reserve currency".[...] The so-called petrodollar system, in which the world's most traded commodity oil and gas are conducted primarily through American currency, appears to be coming to an end. That decades-old system is being challenged by the rise of China, Russia, India, Iran and others. If the petrodollar and its global privileges are displaced then the United States is facing an economic apocalypse. It should be said that there is nothing illegitimate about challenging this American unipolar dominance. Why should countries be forced to conduct their international trade primarily with the US dollar owing simply to historical circumstances during the 1970s that gave rise to the petrodollar system? That system works, in effect, like a global tax that the US imposes on all other nations because they are compelled to purchase American-printed banknotes.[...] Perhaps no two other countries have done more to forge a multipolar global order than China and Russia. China is the biggest oil importer and Russia is the world's biggest fuel exporter. When they announced last year that oil trade would be henceforth conducted in their own national currencies of yuan and rouble that development marked a nail in the dollar's coffin.[...] Now, only a few weeks ago, China and Saudi Arabia – the world's second-biggest oil producer – reportedly launched earnest negotiations for future energy fuel trade to be conducted in yuan. Commentators say Saudi Arabia has little choice in the matter, since China has been progressively reducing the kingdom's market share with other oil exporters, like Russia and Iran. If the Saudis want to maintain exports to the world’s biggest economy, then they will have to do their business in Chinese currency, not the US dollar as they have customarily done. Randy Martin, an American political analyst, said the long-anticipated decline in the petrodollar is picking up pace: "The petrodollar is in decline, and consequently the entire financial system that undergirds the western economies," Martin said. "China and Russia have laid the global economic foundation for the new 'Silk Road' and the emergence of a new Eurasian economy that puts the US and its petrodollar on the outside. That leaves the US dollar and its economy in tatters as long as the US insists on trying to maintain its unipolar quest for global economic dominance. To be clear, what China and Russia have successfully done is to unravel the economic foundation of US global hegemony." [...] However, that historic demise of US power is fraught with danger. That's because the shift from an American-dominated unipolar world to a multipolar one will come at huge economic pain to the US.  American society faces an implosion from poverty, unemployment and social breakdown. "Consequently, the world is faced with a global superpower in mortal decline, which is now expressing its existential fears with wanton military aggression across the globe. This will result in a grave threat to humanity as the US grapples for its place in a new multipolar global economy," Martin concluded. [...] "The US response to its looming demise has been the wholesale underwriting of a military-based economy for Saudi Arabia," analyst Martin observes.[...]"  Related: "End Of The (Petro) Dollar: What The Federal Reserve Doesn’t Want You To Know" Printer Friendly Version  

Concepts and Practices: "The Ultimate Regulatory Reform: Abolish Fractional Reserve Banking" [07/01/17] Printer Friendly Version "... Quite simply: the fundamental cause of the 2008 financial crisis was fractional-reserve banking (FRB). FRB is the practice whereby banks keep a “fraction” of the funds deposited by customers in their vaults lending out the rest at interest and “profit.” Banks are thus inherently unstable since if all depositors came at once and demanded their money (a “bank run”), banks could not be able to redeem their deposits. Moreover, FRB encourages banks to engage in exceedingly speculative and risky behavior which creates unsustainable bubbles throughout the economy. The nation’s central bank, the Federal Reserve, was created by the banksters and politicos to enshrine this immoral and economically ruinous practice into the heart of the American financial landscape. Any “reform” of Wall Street’s financial practices that does not address FRB by doing away with it and the institution (the Fed) which enables it to exist, is doomed. The banks, in collusion with the Fed, are able to expand the money supply through this process while enriching the banksters’ balance sheet. On the macro level, the creation of money through FRB is the genesis of the destructive boom-bust cycle. This is why banks and the entire financial system are so prone to reoccurring crisis and no regulation, reform, or Treasury Department “findings,” can make such a system “stable.” The only true reform is to abolish FRB and establish a monetary order that requires all financial institutions to keep 100% reserves of depositors’ assets. The Treasury Department’s recommendations are mere window dressing by the very banksters whose opulent livelihoods are predicated on FRB. The elimination of FRB would go beyond a beneficial financial revolution, but would affect the foreign policy of the USSA. Without the ability to create money via FRB, the murderous American Empire could simply not exist, nor would the nation’s draconian domestic security state. [...]"  

Trends: "New Louisiana Law Helps Encourage Use Of Gold And Silver As Money" [06/28/17] Printer Friendly Version "On June 23rd, Louisiana Gov. John Bel Edwards signed a bill into law that exempts the sale and purchase of gold and silver from state sales and use taxes, encouraging their use and taking the first step toward breaking the Federal Reserve’s monopoly on money. Rep. Stephen Dwight (R) and Rep. Mark Abraham (R) introduced House Bill 396 (HB396) on March 31. The legislation exempts the sale of platinum, gold, or silver bullion, ingots, or coins that are valued only on their precious metal content from the state sales tax. It also exempts certain numismatic (collectable) coins. The House initially passed HB396 95-0 on May 24. The Senate followed up on June 2 and approved the measure by a vote of 30-2 with some technical amendments. The House then concurred with the Senate amendments by a vote of 103-0. With Gov. John Bel Edwards’ signature, the new law went into immediate effect on June 22. [...] Imagine if you asked a grocery clerk to break a $5 bill and he charged you a 35 cent tax. Silly, right? After all, you were only exchanging one form of money for another. But that’s essentially what Louisiana’s sales tax on gold and silver did. By removing the sales tax on the exchange of gold and silver, Louisiana will now treat specie as money instead of a commodity. This represents a small step toward reestablishing gold and silver as legal tender and breaking down the Fed’s monopoly on money. Practically speaking, eliminating taxes on the sale of gold and silver will crack open the door for people to begin using it in regular business transactions.This marks an important small step toward currency competition. If sound money gains a foothold in the marketplace against Federal Reserve notes, the people would be able to choose the time-tested stability of gold and silver over the central bank’s rapidly-depreciating paper currency.[...] The United States Constitution states in Article I, Section 10, “No State shall…make any Thing but gold and silver Coin a Tender in Payment of Debts.” States have simply ignored this constitutional provision for years. It’s impossible for states to return to a constitutional sound money system when it taxes gold and silver as a commodity. This Louisiana bill takes a step toward that constitutional requirement, ignored for decades in every state. Such a tactic sets the stage to undermine the monopoly of the Federal Reserve by introducing competition into the monetary system.[...]"  Related: "Big Step Forward for Sound Money: Texas Picks Company to Run Bullion Depository" Printer Friendly Version | "Sound Money Is Rising at the State Level: “Will Open The Door For Citizens To More Easily Use Gold And Silver In Transactions" Printer Friendly Version " ... Bills calling for the elimination of capital gains taxes on money, i.e. precious metals, have recently been introduced in both Idaho and Arizona. Money Metals Exchange president Stefan Gleason testified at the hearing and pointed out that “by taxing so-called gains on exchanging precious metals for devalued Federal Reserve Notes, we’re adding another tax on top of the inflation tax.” [...] Meanwhile, Alabama, Tennessee, Virginia, and Maine are working to eliminate sales taxes on gold and silver bullion. Supporters of sound money are working hard to reestablish gold and silver as money according to state law and to make sure it is treated as such in the tax code. Trading one form of money for another should not trigger any tax. There is no sales tax when customers swap their precious metals for dollars, so switching dollars to bullion should also be tax exempt. Oklahoma, Utah, Texas, Idaho, and nearly 20 other states already exempt precious metals from sales tax. Utah and Oklahoma have gone one step further, reaffirming the U.S. Constitution’s designation of gold and silver as legal tender. As such the metals are free from all state taxes – including capital gains.  

Commentary: "First India Bans Cash, Now It’s Targeting Gold" [06/27/17] Printer Friendly Version "In November of last year, India banned certain cash notes in a bold move to force businesses into the banking system to better harvest more taxes from its livestock. Now, under the guise of “improving transparency” and forming a “common market,” India has begun targeting gold with new taxes, regulation, and incentives for citizens to turn over their undeclared gold to the financial sector. Roughly 86% of India’s economic activity happened in cash at the time much of it was banned. Presumably that includes the $19-billion-per-year retail gold industry. Again, it appears that India’s government (central bankers) wants a bigger cut of the action and to better track the private assets of citizens. Bloomberg has been reporting that India’s government is teaming up with crony gold dealers to plan a complete revamp of its gold policy – which is always code for “control, regulate and tax.”[...] India, which vies with China as the top consumer of bullion, is working on new policies to improve transparency and help expand its $19 billion gold jewelry industry, according to people with knowledge of the matter. The plans being worked out by the finance and commerce ministries along with industry groups should be finalized by the end of March, the people said, asking not to be identified because they aren’t authorized to speak publicly…. The start of a spot bullion exchange, to make gold supply more transparent and help enforce purity standards, is under consideration, the people said. An import tax of 10 percent could also be reduced as the government seeks to eliminate smuggling, they said. The plans also include a dedicated bank for the jewelry industry, according to one of the people.[...] In addition to a 10% import tax on gold, which authorities admit causes smuggling, India recently placed a 3% nationwide goods and services tax on gold that goes into effect on July 1st. Grateful slaves celebrated the event as a “lower than expected rate” and as creating a “common market,” Bloomberg reported when the tax passed [...] ProTip to wannabe dictators: If you’re a tyrant who wants to centralize power over an industry, first frighten large businesses into your cartel protection racket. Then, eliminate local sovereignty over markets while imposing your own regulations and taxes. But call it “drawing into a common market” and “improving transparency to protect them.” Works every time. The final step is to prosecute non-compliance using men with guns.[...] Credit Suisse confirmed the latest moves in India are designed to force the gold trade onto the banking system in partnership with the central government to better track and tax the industry. Credit Suisse Group AG told Bloomberg “the (gold) sector will find it tougher to evade taxes as legal imports go through the banking system, and a full trail will now be established by the new nationwide tax compared with previous duties which were levied at the state level only.” This echoes what Credit Suisse Group AG analysts Arnab Mitra and Rohit Kadam previously said of the coming changes to the Indian gold industry: “Over the next two to three years, the new tax should gradually force smaller, unregulated players to become tax compliant and take away their price advantage, increasing market share for bigger, organized businesses. There you have it. The cashless agenda of control laid bare. There shall be no economic activity outside of State control. Cartels that play nice will be rewarded with more market share. It remains to be seen if an already angry Indian citizenry can be persuaded to gift up their tradition of storing and gifting gold.[...]"  

MSM: "Barclays Executives Charged With Paying $400 Million In Kickbacks To Qatar" [06/26/17] [17:46] "The charges filed by Britain's Serious Fraud Office against Barclays Bank executives are unprecedented explains Ian Fraser, author of "Shredded: Inside RBS The Bank That Broke Britain" [...]"  Related: "$1 Billion Ransom Reportedly Paid To Release Members Of Qatar’s Royal Family And Others Who Were Kidnapped In Iraq" Printer Friendly Version "The crisis over Qatar that is gripping the Middle East hinges on an alleged $1 billion ransom that was reportedly paid to release members of Qatar’s royal family and others who were kidnapped in IraqThat payment appears to be the breaking point in the tense relationship between Qatar and Saudi Arabia, the United Arab Emirates (UAE) and other countries in the region, according to one report earlier this month.  On Tuesday, the State Department said it was “mystified” that Gulf states had not given reasons for their decision to cut off of land, air and sea transport to Qatar. "The more time goes by, the more doubt is raised about the actions taken by Saudi Arabia and the UAE,” said a State Department spokeswoman.  "At this point we are left with one simple question: Were the actions really about their concerns regarding Qatar's alleged support for terrorism, or were they about the long-simmering grievances between and among the [Gulf Cooperation Council] countries?" she said. But a report from the Financial Times earlier this month pointed to a nine-figure sum that was paid in a hostage deal as the catalyst for the crisis. [...]"  

Commentary: "EU Political Class Rides Roughshod Over Citizens’ Concerns & Frustrations As It Pushes Integration" [06/26/17] Printer Friendly Version "Even the “elite” is not totally on board. [...] Back on the table is a proposal to upgrade the grossly unaccountable Luxembourg-based European Stability Mechanism (ESM) into a full-fledged European Monetary Fund. As we’ve noted before, creating a European Monetary Fund (EMF) would be an important statement of intent. If Europe’s core countries are truly set on taking the EU project to a whole new level, such as by pursuing the creation of an EU army, an EU border force (with full powers), fiscal union, and ultimately political union, some form of burden sharing will ultimately be necessary. The establishment of a fully operational EMF could be an important move in that direction. The EMF would essentially act as a fiscal backdrop to the banking system, something the Eurozone has desperately needed ever since its creation. As Bruegel proposes, it would serve as a fiscal counterpart of the ECB to guarantee the financial stability of the euro area in the event of a sovereign or banking crisis, or a threat thereof — of which there are plenty these days, in particular emanating from Italy’s broken banking system."  Naturally, the creation of an EMF would deal a further blow to the fading remnants of national sovereignty in Europe. But that’s a price that many (but certainly not all) of Europe’s elite is more than happy to pay; some would say that destroying national sovereignty was the ultimate goal of the EU all along. In a survey of more than 10,000 EU citizens and 1,800 EU elites carried out by Chatham House, of the elites: 37% believe the EU should get more powers, 28% want to keep the status quo and 31% would prefer to return more powers to individual member countries. [...]  This enthusiasm for a more centralized, more powerful EU is not shared with equal enthusiasm by European citizens: 48% want powers returned to the individual member countries. Citizens, overall, do not feel they have benefited from European integration in the same way Europe’s elite does. Whereas 71% of elites report feeling they have gained something from the EU, the figure among the public is only 34%. Even more worrisome for national leaders, a clear majority of the public — 54% — feel that their country was a better place to live 20 years ago, before the euro existed. The findings of the Chatham House survey reflect a growing public frustration with Brussels’ tendency to ride roughshod over their voices and concerns. In a recent Pew poll a median of 53% across nine European countries surveyed, excluding the UK, support having their own national referendums on continued EU membership. And while most do not want to leave the bloc altogether, many European citizens want to ensure that their voices are heard. That is unlikely to happen: engagement and consultation have never been Brussels’ strong points. According to Fredrik Erixon, a Brussels-based economist and co-founder of European Centre for International Political Economy (ECIPE), the EU’s gaping lack of democratic accountability and legitimacy and its determination to plow ahead with integration regardless of popular support (or lack thereof) will ultimately be its undoing.[...]"

Delusional Convolutions: "America's Rich Are Completely Losing Touch With Reality... And That's A Really Bad Sign" [06/25/17] Printer Friendly Version  "The divide between wealthy and working class has grown wider each year since the last financial crisis, but this disconnect is about much more than just money or politics. The super-rich, in particular, have become completely detached from the everyday problems facing millions of their fellow citizens. Instead of recognizing the urgency of the current situation and contributing to solutions that help empower all members of society, the focus for many has shifted toward simply indulging in the present moment and increasing luxury. This kind of self-centered worldview has emerged throughout history and typically thrives most when decadent empires start to crumble. Right now, the average person is forced to worry about central banks devaluing their currencies, corrupt bureaucrats eroding their civil liberties, and an economy on life support. Meanwhile, a faction of affluent individuals has committed themselves to avoiding the turmoil around them, instead choosing to obsess over life extension, genetic manipulation, and creating luxurious doomsday plans. Those people who have the crucial intellect, resources, and influence needed to implement real change are consumed with self-interest to the point of total apathy towards the future. One of the more disturbing trends has been a rise in interest regarding something called parabiosis. This practice involves blood transfusions between the young and old in an attempt to slow the aging process. The procedure has been studied in the past but has always been met with moral and scientific criticism. Recently, however, a California start-up called Ambrosia began offering clients the opportunity to purchase the blood of someone under the age of 25 for a mere $8,000. [...] The process gained attention after Paypal co-founder Peter Thiel came out in support of further research during an interview: “I’m looking into parabiosis stuff, which I think is really interesting. This is where they did the young blood into older mice and they found that had a massive rejuvenating effect. And so that’s … that is one that … again, it’s one of these very odd things where people had done these studies in the 1950s and then it got dropped altogether. I think there are a lot of these things that have been "strangely under-explored". [...] "  

Commentary: "$3.8 Trillion Commercial Real Estate Asset Bubble Implosion In Progress [06/24/17] Printer Friendly Version "The death of retail as we know it is real. People are shifting their buying habits online in a fast and furious way. The only retail outlets that seem to be thriving are dollar stores but they are thriving because many Americans are living paycheck to paycheck and online shopping is too expensive for some. So it should come as no surprise that the way things were once done is being upended again by technology. Giants like Amazon and Wal-Mart are cannibalizing entire industries. Back in 2012 Amazon had less than 10 million Prime subscribers. Today it is over 80 million. So the big bubble that is now imploding is that in commercial real estate. There is $3.8 trillion in commercial real estate loans outstanding and the bubble in this market couldn’t be peaking at a worse time.Keep in mind that a large portion of commercial real estate is driven by malls and retail locations. Americans are still shopping but they are shopping online. The old model is cracking hard and we are deep into bubble territory here. Commercial real estate values are up more than 105% from their lows reached in 2009. Current CRE values are surpassing peak values reached during the last real estate mania. It looks like we have reached a peak.[...] I’ve been in many malls over my lifetime and recently, there is this deep sense that something is changing and you can see it. Empty store spaces. Massive sales. Deep discounts. The issue is that many Americans in particular young Americans work in retail. While the pay is low, it is better than nothing. The two largest occupations in the US are retail and cashiers. And both of these are under fire. Then you have McDonald’s announcing that cashiers will be replaced with self-serve kiosks. So what do you think all of this will mean for low wage workers that dominate the economy? The above headline seems to sum it up however. Wall Street is cheering this on but the vast majority of Americans that don’t own stock are getting cut to the core. Welcome to the race to the bottom. The CRE implosion is not going to be pretty. [...]" Related: "Retail Hell: 5,300 Stores Have Closed This Year" Printer Friendly Version  

Commentary: "Wall Street Journal Fires Chief Correspondent Over Links To CIA Arms Dealer" [06/23/17] Printer Friendly Version "The Wall Street Journal on Wednesday fired its highly regarded chief foreign affairs correspondent after evidence emerged of his involvement in prospective commercial deals — including one involving arms sales to foreign governments — with an international businessman who was one of his key sources. The reporter, Jay Solomon, was offered a 10 percent stake in a fledgling company, Denx LLC, by Farhad Azima, an Iranian-born aviation magnate who has ferried weapons for the CIA. It was not clear whether Solomon ever received money or formally accepted a stake in the company. “We are dismayed by the actions and poor judgment of Jay Solomon,” Wall Street Journal spokesman Steve Severinghaus wrote in a statement to The Associated Press. “While our own investigation continues, we have concluded that Mr. Solomon violated his ethical obligations as a reporter, as well as our standards.” [...]"  

Commentary: "The Dead Giveaways Of Imperial Decline" Charles Hugh Smith [06/22/17] Printer Friendly Version "Nothing is as permanent as we imagine--especially super-complex, super-costly, super-asymmetric and super-debt-dependent state/financial systems. [...] Identifying the tell-tale signs of Imperial decay and decline is a bit of a parlor game. The hubris of an increasingly incestuous and out-of-touch leadership, dismaying extremes of wealth inequality, self-serving, avaricious Elites, rising dependency of the lower classes on free Bread and Circuses provided by a government careening toward insolvency due to stagnating tax revenues and vast over-reach--these are par for the course of self-reinforcing Imperial decay.[...] Sir John Glubb listed a few others in his seminal essay on the end of empires The Fate of Empires, PDF what might be called the dynamics of decadence: (a) A growing love of money as an end in itself. (b) A lengthy period of wealth and ease, which makes people complacent. They lose their edge; they forget the traits (confidence, energy, hard work) that built their civilization. (c) Selfishness and self-absorption. (d) Loss of any sense of duty to the common good. Glubb included the following in his list of the characteristics of decadence: -- an increase in frivolity, hedonism, materialism and the worship of unproductive celebrity (paging any Kardashians in the venue...) -- a loss of social cohesion -- willingness of an increasing number to live at the expense of a bloated bureaucratic state [...] Historian Peter Turchin, whom I have often excerpted here, listed three disintegrative forces that gnaw away the fibers of an Imperial economy and social order: 1. Stagnating real wages due to oversupply of labor 2. overproduction of parasitic Elites 3. Deterioration of central state finances" [...] To these lists I would add a few more that are especially visible in the current Global Empire of Debt that encircles the globe and encompasses nations of all sizes and political/cultural persuasions: 1. An absurdly heightened sense of refinement as the wealth of the top 5% has risen so mightily as a direct result of financialization and globalization that the top .1% has been forced to seek ever more extreme refinements to differentiate the Elite class (financial-political royalty) from financial nobility (top .5% or so), the technocrat class (top 5%), the aspirant class (next 15%) and everyone below (the bottom 80%). 2. The belief in the permanence of the status quo has reached quasi-religious levels of faith. The possibility that the entire financialized, politicized circus of extremes might actually be nothing more than a sand castle that's dissolving in the rising tides of history is not just heresy--it doesn't enter the minds of those reveling in refinement or those demanding more Bread and Circuses (Universal Basic Income, etc.)  3. Luxury, not service, defines the financial-political Elites. As Turchin pointed out in his book on the decline of empires, in the expansionist, integrative eras of empires, Elites based their status on service to the Common Good and the defense (or expansion) of the Empire. 4. An unquestioned faith in the unlimited power of the state and central bank. The idea that the mightiest governments and central banks might not be able to print their way of our harm's way, that is, create as much money and credit as is needed to paper over any spot of bother, is unthinkable for the vast majority of the populace, Elites and debt-serfs alike. That all this newly issued currency and credit is nothing but claims on future production of goods and services and rising productivity never enters the minds of the believers in unlimited state/bank powers. We have been inculcated with the financial equivalent of the Divine Powers of the Emperor: the government and central bank possess essentially divine powers to overcome any problem, any crisis and any conflict simply by creating more money, in whatever quantities are deemed necessary. That there might be limits on the efficacy of this money-creation never enters the minds of the faithful. [...] It is instructive to ponder the excesses of private wealth and political dysfunction of the late Roman Empire with the present-day excesses of private wealth and political dysfunction: [...]"  Related: "From Rome to America (An Empire Self-Destructs)" Printer Friendly Version   

Commentary: "Deloitte Audited the Fed for Eight Straight Years of the Financial Crash" [06/21/17] Printer Friendly Version "In 2006 the Federal Reserve’s books were audited by PricewaterhouseCoopers. But beginning in 2007 and for every year thereafter through 2014, the Fed’s books were audited by Deloitte & Touche. That’s a very long eight years that just happen to coincide with the greatest economic upheaval in the U.S. since the Great Depression. (Since 2015, KPMG has issued the annual audited statement of the Fed’s books.) We’re not suggesting that Deloitte didn’t do its job properly but we are suggesting that the Fed benefited by not having a bunch of different prying eyes looking at its books during those bizarre years when its assets ballooned from $914.8 billion at the end of 2007 to $4.5 trillion in 2014. In just the single year of 2013 the Fed’s assets jumped by a staggering $1 trillion from $2.9 trillion at the end of 2012 to $4 trillion at the end of 2013, according to Deloitte’s audited financial statement of the Fed’s books. In January of this year, the Government Accountability Office (GAO) released a study indicating that as of October 31, 2016, the government “had disbursed $22.6 billion (60 percent) of the $37.51 billion Troubled Asset Relief Program (TARP) funds” that were directed at helping distressed homeowners as a result of the 2008 Wall Street financial crash and the resulting housing bust. When that report was released, Wall Street On Parade compared it to what the Fed was doing for the banks behind a very dark curtain.  [...]"  Related: "UK: Barclays And Four Individuals Charged With Conspiracy To Commit Fraud During Financial Crisis" Printer Friendly Version  

Trends: "Several States Set To Collapse Under Crushing Weight Of Bankrupt Pensions" [06/21/17] Printer Friendly Version "Across the country, city governments have all spent the pension funds instead of saving them. Almost no large city has the funds necessary to pay its obligations to retirees. Pension financial planning strategies are tragic nightmares of broken promises, dishonest politicians and delusional workers (who still somehow believe they’re going to get paid). [...] In December 2014, it was noted that underfunded pensions were set to take a new economic hit, as Congress considered legislation that would allow local governments to arbitrarily cut the benefits of retirees, many of whom were on fixed incomes.[...] In 2016 the city of Dallas had to freeze pension benefits lest the fund go completely broke, suspending withdrawals from the fire and police pension systems to prevent insolvency. Now, it seems, even entire states are about to be consumed by broke pension funds: Illinois could be the first. The Land of Lincoln has been wrestling with underfunded pensions and over-promised benefits now for years, but in recent months the situation has gotten so bad that Illinois could be the first U.S. state to declare bankruptcy.[...]"  Related: "Illinois Comptroller: “The State Can No Longer Function, We Have Reached A New Phase Of Crisis”" Printer Friendly Version | "Teamsters Private Pension Near Bankruptcy; Benefits Of 407,000 Retirees May Be ‘Virtually Nothing’ (2016)" Printer Friendly Version "America’s public (i.e, government) and private pensions are in trouble. The difference is that the government pensions don’t go bankrupt because Uncle Sam hits taxpayers to continue funding government retirees. Now, one of America’s biggest private pensions — the Teamsters’ Central States Pension Fund that covers more than 1,500 companies across a range of industries — is nearly bankrupt. The fund currently pays out $3 for every $1 it takes in. If there’s no bail out by the federal government, the Fund will run out of money in 10 years, by 2026, at which time the pensions of some 407,000 people — most of whom are truck drivers — will be reduced to virtually nothing. [...] was precipitated the Fund’s crisis was the Treasury Department’s rejection on May 6, 2016, of a last-ditch solution proposed by the Fund which would partially reduce the pensions of 115,000 retirees and the future benefits for 155,000 current workers. Although the proposed cuts were steep, as much as 60% for some, it still wasn’t enough. The Treasury Department rejected the proposed reduction because doing so would not actually head off insolvency. The fund could submit a new plan, but decided this week that there’s no other way to successfully save the fund and comply with the law. The cuts needed would be too severe. One of the reasons why the Central States Pension Fund is in trouble is because a lot of the fund’s companies went bankrupt after the trucking industry was deregulated in the 1980s.[...]' “Never let a crisis go to waste.” -Rahm Emmanuel

Commentary: "Senate Bill: Travelers Must Register Cash/Digital Amounts Over $10K" [06/18/17] Printer Friendly Version "A new bill seeks to track your money and assets incessantly, will enjoin any business with government ties to act as a de facto arm of DHS, and would steal all of your assets — including Bitcoin and other cryptocurrencies — should you fail to report funds when traveling with over $10,000. Under the guise of combating money laundering, Senate Bill 1241, “Combating Money Laundering, Terrorist Financing, and Counterfeiting Act of 2017,” ramps up regulation of digital currency and imposes other autocratic financial controls in an attempt to ensure none of your assets can escape one of the State’s most nefarious, despised powers: civil asset forfeiture.[...] All of this under the farcically broad umbrella of fighting terrorism. Civil forfeiture grants the government robbery writ large: your cash, property, and assets can be stolen completely sans due process, your guilt — frequently pertaining to drug ‘crimes’ — matters not.[...] A court verdict of not guilty doesn’t even guarantee the return of State-thefted property.[...] In fact, the government can seize virtually whatever it wants if it so much as suspects some of your assets might have been acquired through or used in the commission of even lesser crimes.[...]For some time, a war on cash has been brewing behind the closed doors of government, and — although officials prefer to claim counterfeiting, terrorism, and money laundering as the impetus for asset tracking — in actuality, physical currency facilitates black market and untaxed transactions, and, most imperatively to the U.S., cannot be thefted under civil asset forfeiture laws as easily as money exchanged digitally.[...]Characterized as an effort to “to improve the prohibitions on money laundering, and for other purposes,” the bill severely curtails the right to travel freely, without undue hindrance, as travelers with more than $10,000 in assets — including those held digitally, like Bitcoin — must file a report with the U.S. government.[...]Noncompliance with the tyrannical law — including failing to fill out the aforementioned form — would incur penalties befitting a fascist dictatorship: an individual could find the entirety of their assets seized, not just those unreported, and could be locked in a prison cage for up to ten years. According to the legislation, reports Smaulgold.com, the Secretary of Homeland Security and the Commissioner of U.S. Customs and Border Protection must, within 18 months of the legislation’s passage, devise a “border protection strategy to interdict and detect prepaid access devices, digital currencies, or other similar instruments, at border crossings and other ports of entry for the United States, including an assessment of infrastructure needed [emphasis added] to carry out the strategy […] “The obligation to declare amounts in any form over $10,000 exists, irrespective of whether custom officials have a way of detecting such holdings. Since digital currencies technically travel with the holder [wherever] the holder goes, one would have to declare one’s entire crypto portfolio each time the holder entered the U.S.”[...] Travelers possessing assets, precious metals, and accounts in excess of $10,000 held outside the United States, however, would not be required to declare those to the government — perhaps leaving an albeit sketchy option for those wary of unscrupulous authorities.[...]" 

Commentary: "America's Book of Secrets S03E07: The Billionaire Agenda" History Channel [06/15/17] [42:57] "There are 492 billionaires in the US, 152 in China and 111 in Russia. For the US alone, their combined wealth exceeds $2 trillion. What is the psychology behind their mind sets? What is their real agenda? [...]" Note: Many other videos from the same series are available through this link.  

Commentary: "Rothschild Empire, Financial Turmoil" [06/13/17] Printer Friendly Version "Jacob Rothchild - A Conversation With Irina Nevzlin" [10:04] "The Rothschild empire is now looking at fresh financial turmoil as suggested by the RIT Capital Partners 2016-year-end report, which could also have a huge effect for the rest of the planet. Jacob Rothschild also recently announced that he is to buy up all remaining gold to replace stock market and currency exposure, which signals the biggest financial crash since the Lehman Brothers crash in 2008. Freethoughtproject.com reports: The investment banker’s chosen word of “period” seems to indicate a coming downturn in profitability, even though for the past five years the fund has realized a profit of more than 1 billion Euros. According to the report, Rothschild and his very powerful family have a vested interest in preserving their assets. “RIT Capital Partners plc is an investment company listed on the London Stock Exchange. Its net assets have grown from £280 million on listing in 1988 to over £2.7 billion today. RIT is chaired by Lord Rothschild, whose family interests retain a significant holding,” the issue reveals. If the fund, whose value is at an all-time high, suddenly declines, falling with it will be a large portion of wealth the Rothschild family enjoys. Although, any such declines would hardly come as a surprise to the Rothschild family who reportedly controls much of the world’s wealth and has a hand in nearly all of the world’s banking institutions, including the Federal Reserve, as some have stated. The chairman’s statement continues with what some might say is an ominous and uncertain view of the future. “Since the last World War, we have enjoyed some 70 years of patiently crafted international cooperation, which is now threatened,” an apparent reference to Brexit and the UK’s referendum to withdraw from the European Union. “Against this deeply worrying geo-political situation,” he wrote seeming to highlight the potential of WWIII if the Syrian conflict continues, “one can point to a number of positive investment factors.” Echoing many statements made by the current U.S. president, Lord Rothschild stated he was hopeful corporations would receive a break in government imposed revenue. He said, “in the US, the proposed tax reduction for companies and individuals,” was a favorable policy change for his fund’s portfolio. [...]"

Commentary: "Wall Street Moves One Step Closer To Repealing Dodd-Frank" [06/09/17] Printer Friendly Version "While much of the nation’s attention was focused on James Comey’s account of his interactions with President Donald Trump on Thursday, a key part of the president’s anti-regulatory agenda moved forward in Congress with far less fanfare: The House passed a bill that would dismantle the Dodd-Frank financial regulations put in place in 2010. The vote gave the the financial industry its largest victory in its nearly decade-long battle to roll back the government’s regulatory response to the largest financial crisis since the Great Depression. [...] The House voted 233-186 Thursday to pass the Financial CHOICE Act, a bill Republican proponents say would end “too big to fail,” remove onerous financial regulations that hurt small banks, and rein in the unaccountable power of the Consumer Financial Protection Bureau (CFPB). Opponents, which include a coalition of attorneys general representing 20 states, say the bill would remove key liquidity requirements that prevent Wall Street banks from making risky bets, weaken crucial oversight provisions and hurt consumers by limiting their access to financial information and removing limits on debit-card transaction fees. But while it’s unclear what the ultimate impact of the bill, or its fate in the Senate, will be, the battle over Dodd-Frank has already attracted a huge amount of money, in both campaign contributions and lobbying, much of it by Wall Street banks eager to see Dodd-Frank dismantled. [...]  Since 2010, banks and lending institutions, commercial banks, and investment holding and securities and investment firms have given $190 million to federal candidates and officeholders, including $54.3 million in the 2016 election cycle, according to the Center for Responsive Politics. More than $110 million of that total has gone to Republicans and $75 million to Democrats. While those numbers represent giving by those industries as a whole, and can’t be tied to a particular issue, there is evidence that much of that money has been spent to unshackle the big banks from post-recession financial regulation. For instance, an analysis by Maplight.org found that commercial banks and holding companies gave the 41 sponsors of the Financial CHOICE Act an average of $55,754 during the 2016 election cycle. Those industries gave, on average, just $20,518 to the average House member during that period. A previous Maplight analysis found that there was a sharp divide between the financial industry’s contributions to members of the House Financial Oversight Committee who voted for the bill and those who voted against it. The 34 Republicans on the committee who voted to send the bill to the House floor for a full vote received, on average, 80 percent more campaign cash from commercial banks and holding companies than the 26 members who voted against the bill." The member of the committee who has taken the most money from banks, securities and investment firms and investment holding companies in recent years is Jeb Hensarling, R-TX, chair of the Committee, who introduced the Financial CHOICE Act and told the American Bankers Association in March 2016 that he would “not rest until Dodd-Frank is ripped out by its roots and tossed on the trash heap of history.”[...]"  

MSM: "The British Pound Plunges as Early Exit Polls Suggest Conservatives Fail to Win 326 Seats" [06/09/17] Printer Friendly Version "The British pound plunged close to 2.0 percent on Thursday afternoon after early UK exit polls showed Theresa May’s Conservative party gaining only 314 seats amid an unusually high voter turnout. Early polls suggest that Conservatives may fail to get the needed majority - 326 seats - for a new mandate to advance Brexit negotiations and block a 2nd Scottish independence referendum. George Osborne, former British finance minister, characterized the polls as “catastrophic” for May’s party, "It is early days. It's a poll. If the poll is anything like accurate this is completely catastrophic for the Conservatives and for Theresa May," he told ITV News, according to Reuters. Prior to the exit polls, around 4:55 p.m. EDT, the pound was trading against the dollar at 1.2906, but after British news outlets began reporting on the surprise results, the GBP/USD pair sold off 1.94 percent in the space of ten minutes. By 5:04 p.m., the rate was hovering at a 2-month low of 1.2704 [...]" [Cross-Posted]

Commentary: "The Real Legacy Of The US Wars In The Mideast — Never-Ending Debt" [06/05/17] Printer Friendly Version "The longer U.S. troops remain in Iraq and Afghanistan, the greater the financial costs to the United States. Taken together, the cost of those wars could be as high as $6 trillion, including medical and disability care for vets and all their families and a host of other expenses such as rising interest charges on the debt that finances military operations. The sobering analysis comes from a 2013 paper by Linda J. Bilmes of the Harvard Kennedy School, “The Financial Legacy of Iraq and Afghanistan: How Wartime Spending Decisions Will Constrain Future National Security Budgets.” Bilmes contends that the money spent on these wars since 2001 will “dominate future federal budgets for decades to come.” [...] Defense spending is certainly dominating the Trump budget, especially in relation to the programs that benefit low- and middle-income families and individuals, which he intends to cut by 50 percent. Aside from paying for the arsenal of weapons, including the investment in fighter planes, drones, helicopters, aircraft carriers, tanks and the like, the money spent on the star-crossed F-35 -- which is expected to cost $1.5 trillion over the 55-year life of the program -- puts the hardware budget over the top.[...]" 

Trends: "Commercial Banks Slash Auto Loans Outstanding For First Time In Six Years" [06/01/17] Printer Friendly Version "After the subprime mortgage bubble burst back in 2009, new regulations prevented banks from rushing right back into mortgages to re-inflate a market that nearly took down the global financial system. Of course, Uncle Sam didn't restrict wall street from blowing massive bubbles in all asset classes, in fact the Fed seemingly condones it, just the mortgage market. And so, all that loan volume shifted to autos... Alas, it seems as though commercials banks are finally starting to wonder whether they've inflated at least the auto loan bubble to the brink of bursting. As the Financial Times points out today, the FDIC's commercial lending report for 1Q 2017 showed that commercial banks slashed their auto loan exposure sequentially for the first time in the past six years.[...]"   Related: "Where The World's Unsold Cars Go To Die" Printer Friendly Version   

Trends: "Euro Slides After Greece Hints At Default" [05/30/17] Printer Friendly Version "EURUSD is sliding in early Asian trading after Greece's government is reportedly planning to forego its next bailout payment (of around EUR7bn) if no debt relief is offered by creditors (thus leaving it likely to default on its next round of repayments). Bloomberg reports, Greece’s government preparing to possibly go without next bailout payment if creditors don’t agree on debt relief for the country according to German newspaper Bild (without saying where it obtained the information). While probably just another negotiating step, it is weighing on EURUSD. [...]"  Related: "A Problem Emerges With Europe's "Recovery": Companies Crippled By Soaring Payment Delays" Printer Friendly Version "According to the 2017 European Payment Report compiled annually by Swedish debt collector Intrum Justitia AB, a growing number of small and medium-sized businesses in Europe have complained they face excessive delays in being paid for their work, with large parts of the sector seeking tougher laws to address the problem. First discussed by Bloomberg, the Justitia report reveals that 61% of the 10,468 small and medium-sized companies surveyed say they’ve been asked by counterparties to accept longer payment delays than they feel comfortable with. This is a staggering increase of over 30% in just one year: in 2016, that figure was 46%.  [...]"  

Trends: "Calls To Ban Bitcoin Grow Louder After Ransomware Attack" [05/29/17] [21:46] "In this video, Vin Armani covers the predictable fallout from the WannaCry ransomware attack. First they blame North Korea and bitcoin. Then an establishment think tank connects bitcoin to terrorism and presses Congress to ban it. [...]"  Related: "Bitcoin Moves into “Pump and Dump” Phase" Printer Friendly Version "After yesterday’s massive Bitcoin correction, which saw the crypto currency plunge nearly $500 — over 10% — in a matter of hours, the Bitcoin propagandists took to their microphones to denounce anyone who rationally warns people about the volatility risk and increasingly “Ponzi” structure of Bitcoin. What do all the people still pumping Bitcoin have in common? They all own lots of Bitcoin, and they need more suckers to join the scheme so they can unload their Bitcoin onto them at higher and higher valuations. [...] Bitcoin, in essence, has now become a “pump and dump” scheme. Amazingly, these are the very same people who say the stock market is going to crash because P/E ratios are out of whack and stock valuations are based on high expectations rather than earnings fundamentals. Yet Bitcoin pays no dividends at all and doesn’t have a P/E ratio since it’s not the stock of a company that produces anything that’s real. When corporate stocks skyrocket in value over time, it’s usually because those corporations experience increasing profits and pay out increasing dividends to shareholders. Yet Bitcoin has no “profits” other than speculative profits. It doesn’t produce anything other than more Bitcoins. It pays no dividends, and it isn’t even an entity that owns any real assets such as factories, land or raw materials. Bitcoin isn’t even an entity. It’s more like a mathematical hologram. In fact, Bitcoin isn’t subject to SEC regulations like regular stocks are, which is why Bitcoin is rife with “insider trading” and unscrupulous future valuations claims that would get people arrested if this took place in publicly- traded corporations. It’s sad. We are watching Bitcoin devolve into a giant CON, and it’s the self-serving Bitcoin owners who are screaming the loudest for everyone to keep buying in. This is exactly the kind of thing that’s going to end up getting Bitcoin criminalized and banned by the governments of the world after tens of millions of (stupid, naive) people experience catastrophic losses.[...]" | "Bitcoin Explodes, Trades Above $4,000 In South Korea" [05/25/17] Printer Friendly Version | "Cryptocurrency Chaos: Bitcoin Bounces Back After Crashing As Asian Fever Re-Emerges" Printer Friendly Version | "Bitcoin Explodes Above $2400 After China Downgrade, Scaling Agreement Reached" Printer Friendly Version | "Stocks Jump As Dollar Dumps And Bitcoin Explodes To Record Highs" [05/22/17] Printer Friendly Version | "People Are Making A Fortune Buying Government-Seized Bitcoins" Printer Friendly Version   

Trends: "Chipotle Hacked In Massive Breach - Customer Payment Data Stolen From Thousands Of Restaurants" [05/29/17] Printer Friendly Version "Chipotle Mexican Grill ($CMG) announced late Friday that Hackers used malware to infiltrate their Point of Sale payment systems over a three week period beginning in late March - stealing sensitive customer banking information, including account numbers and internal verification codes that could be used to drain debit-card linked bank accounts. [...]"  Note: I always thought it was a foolish idea to link a debit card to a bank account. A smarter option: a pay-as-you-go card which you load periodically with just what you need to spend. That way if the number gets stolen, it limits the damage, and you just buy a new card with a different number. The financial world is full of thieves and misfits.

Commentary: "Trump-Russia Inquiry Looks at Potential for Wall Street Bank Money Laundering" [05/27/17] Printer Friendly Version "The majority of American citizens have never heard of the U.S. Treasury agency known as FinCEN – short for Financial Crimes Enforcement Network. But for those who work for Wall Street brokerage firms or the mega Wall Street banks like JPMorgan Chase, Citigroup or German banking giant Deutsche Bank, just the mere mention of FinCEN can quickly produce beads of sweat dripping onto those expensive Canali suits. That’s because FinCEN is the Federal agency where suspicious financial activity that might turn out to be money laundering gets reported. All three banks, and numerous others, have had their share of scandalous run ins with money laundering*. In recent weeks, the U.S. Senate Banking Committee, Senate Intelligence Committee and the House of Representatives Financial Services Committee have all shown an interest in what FinCEN might have in its database that would shed sunshine on involvement of the Trump business empire or Trump campaign and Russian money inflows. [...]"  Related: *Flashback: "Bombshell Documents Vanish in the JPMorgan-Madoff Investigation" 2014 Printer Friendly Version "According to a Freedom of Information Act response received by Wall Street On Parade, Federal law enforcement may share the blame with JPMorgan Chase for allowing Bernard Madoff’s Ponzi scheme to be perpetuated for so long.[...]"|"Trump’s Justice Department Goes Easy on Citigroup Unit for Criminal Money Laundering" Printer Friendly Version "Citigroup, the Wall Street mega bank that taxpayers were forced to prop up in the largest bailout of a financial institution in U.S. history from 2008 to 2010, is also a recidivist lawbreaker that the U.S. Justice Department fails to tame regardless of who occupies the Oval Office. [...]" 

Commentary: "Are Credit Rating Agencies America’s Secret Fifth Column?" [05/27/17] Printer Friendly Version "A “Fifth Column” is a group within a country at war who are sympathetic to or working for its enemies. Even a full-blown war with North Korea or Russia could not inflict the damage done to this Country by Moody’s, Fitch and S&P. The rating agencies have declared war on the United States and the damage they are inflicting will eventually destroy this Country from within. In 2008, the Country was brought to its knees with the eight trillion-dollar mortgage bond crisis. It again got a taste of what the rating agencies are capable of with the Detroit and Puerto Rico bankruptcies. You see when a credit rating agency or a bank works on transactions worth hundreds of millions or billions, they deploy their best folks. The most experienced and educated investment bankers. This is also true of the Banks that knowingly sell these fraudulent investments to their unsuspecting clients. [...] If the best people in the industry worked on the mortgage bonds and the Detroit and Puerto Rico’s municipal bonds how can these massive losses be possible? If one were simply to read the bond offering documents you could clearly see that both the cash flow and collateral were no good. Even a rookie Banker could have uncovered these weaknesses. When and investor buys a properly rated bond and takes a loss, it is a simple investment loss. If an investor buys a bond with a fraudulent rating, it is criminal fraud. According to the FBI and Attorney General the tens of thousands of transactions executed by the Rating Agencies were just unfortunate mistakes, although the Rating Agencies and Banks freely paid billions in fines to put these mistakes behind them. If you talk to Wells Fargo Bank, B of A, Citibank among some of the dozens of Wall Street Banks, they did nothing wrong, they just missed the fact these investments had no cash flow or collateral to support their repayment and they did it repeatedly over a decade. If you are to believe our Justice Department, none of this had to do with the billions of dollars in fee’s the Ratings Agencies and Banks made. How can one do this and get away with it, repeatedly? How well connected are the Rating Agencies and Banks that they remain immune from prosecution while tens of millions of American’s lives are ruined? [...]"  

MSM: "Greece Default Looms As Eurozone And IMF Clash Over Debt Measures" [05/25/17] Printer Friendly Version "Eurozone countries are at loggerheads with the International Monetary Fund (IMF) over Greece's debt programme, as time runs out to stop Athens crashing into bankruptcy and out of the bloc.  Despite another round of marathon talks yesterday, Greece's creditors failed to agree on fundamental elements of the country's bailout programme. Without a deal, a desperately needed loan payment to Athens cannot be made. [...] And the situation is now reaching boiling point, as Greece has to make debt payments of around £6billion in July. Yet after months of talks, the IMF and the eurozone appear unable to put aside their differences over details of the €86billion (£74bn) bailout programme initially agreed in July 2015. The row will now not be resolved before June 15 when eurozone finance ministers meet again.[...]"  

Commentary: "Mnuchin: Trump Budget Proposal "Will Prevent Taxpayer Bailouts" [05/24/17] Printer Friendly Version "In a statement issued moments ago discussing Trump's proposed, if completely impossible, budget proposal, Treasury Secretary Steven Mnuchin said that Trump's "budget will achieve savings through reforms that prevent taxpayer bailouts and reverse burdensome regulations that have been harmful to small businesses and American workers." Translation: taxpayer bailouts are imminent, especially now that the current economic cycle is the 3rd longest of all time and a recession grows likelier with every passing day. Mnuchin also said that Trump's proposed initiatives "coupled with comprehensive tax reform and other key priorities, will move America one step closer to sustained economic growth of 3 percent or higher." While we will clearly take the under, what we find most amazing about Trump's budget proposal, is that it does not anticipated a recession until 2027. That would imply 18 years of economic growth since the 2009 recession, without a single contraction! Good luck with that.[...]" 

Commentary: "Law Firms Making Killing Off Madoff Victims' Recovery Funds" [05/24/17] Printer Friendly Version "We all are familiar with the $64b in lost capital by Madoff, which was the worst ponzi scheme loss in history. But did you know that only $17.5b in principal was lost? Of that principal, most of it has been recovered -- $9 through Picard and another $4b through Breeden. I am not here to suggest that losing $4.5b isn't dreadful -- because it is. But most people still believe that people were totally wiped out by Madoff, who is currently serving a 150 year sentence in prison. The big winners in all of this, naturally, are the lawyers who are administrating the victim funds via billable hours. Through a Bloomberg FOIA request, we've learned that the DOJ hired Breeden to distribute $4b in recovered funds to Madoff victims, of which ZERO has been paid to date. Breeden, on the other hand, has racked up $38.8m in fees. [...]"  

Commentary: "Trump Comes To Riyadh As Saudi Arabia Bankrupts Itself" [05/21/17] Printer Friendly Version "US President Trump arrives in Saudi Arabia at a time when Deputy Crown Prince Mohammed bin Salman - the country's de facto ruler - has launched it on a runaway spending programme which is bound to end in national bankruptcy. Whilst the US claims to be the leader of the “free world” the embarrassing reality is that its most important Middle East ally is a repressive autocratic Wahhabist monarchy. Whilst Donald Trump says the destruction of Jihadi terrorism is his priority, Saudi Arabia – as everyone knows – is the country that bankrolls most of this terrorism.[...] The fact however remains that Saudi Arabia is the lynchpin of the whole of the US’s strategic position in the Middle East, whilst Saudi Arabia’s oil exports – and the fact that it sells them for US dollars – serve a key role in underpinning US dominance of the world economy. Whilst this remains the case the US has no realistic option but to maintain good relations with the Saudis. In that respect Trump’s courtship of the Saudis makes far more sense that Obama’s ill concealed disdain for them, and given the damage Obama did to this crucial relationship Trump’s priority on repairing it – and thus his visit to Saudi Arabia – makes complete sense. What all the talk of Trump’s visit obscures however is that even as the US seeks to renew its relationship with Saudi Arabia, the Kingdom has embarked on an out-of-control spending spree which can only result in its eventually bankrupting itself. To understand the scale of what is happening, just consider the outline of the projects that are supposed to be under discussion during Trump’s visit. The Financial Times provides a good summary: [...]"  Related: "Blackstone, Saudi Arabia Announce $40 Billion Investment In U.S. Infrastructure" Printer Friendly Version  

MSM: "Yale Launches Elitist Financial 'Crisis Response Project' Funded By Bill Gates and Jeff Bezos" [05/17/17] Printer Friendly Version "Yale School of Management reports that $10 million has been raised to expand the Yale Program on Financial Stability and launch the “Crisis-Response Project.”  The project is primarily funded by Jeff Bezos, Bloomberg Philanthropies, Bill Gates, and the Peter G. Peterson Foundation. The goal of the project is to "codify best practices and provide training that can help governments fight financial crises." Who are the advisors that will be advising on the project? The operatives that bailed out Goldman Sachs and the other crony parts of Wall Street following the 2008 financial crisis. [...]"  

Commentary: "Ukraine Teeters On The Brink Of Default As Kiev Struggles To Repay Debts" [05/17/17] Printer Friendly Version "In the next four years, Ukraine will have to return $20 billion of debt. The lack of reforms and problems with receiving new loans are a major obstacle. The situation is complicated by the fact that the government will not take unpopular measures due to the 2019 presidential election. [...] In 2018, Kiev will have to return $3.9 billion to creditors while in 2019 $7.5 billion. The situation is complicated by the fact that in 2019 prior to the presidential election the government will have to improve social standards, in order to win voters’ support. Kiev does not have money to increase social benefits, and as a result will have to implement its unpopular pension reform, including removing some of the subsidies and increasing minimal employment record from 15 to 25 years. Additional money could also be earned from selling agricultural lands, a measure insisted by the International Monetary Fund (IMF). However, the move is likely to spark public outrage across the country." Related: See Confessions of an Economic Hit Man, below.

Commentary: "Paradise Has Run Out of Money: Barbados May Be Forced to Ask IMF for Loan" [05/16/17] Printer Friendly Version "The economy of the Caribbean paradise island of Barbados is facing meltdown after years of alleged mismanagement and an over-reliance on tourism. The economy of the Caribbean island hit the buffers after the 2008 financial crisis, with tourism plummeting and the country's economy contracting by four per cent. The country may be forced to ask the International Monetary Fund (IMF) for a bailout in order to pay police officers and civil servants. [...]"  Note: But they'll ignore the rest of the population ... by making a deal with the criminal IMF (see Economic Hitman) "Confessions Of An Economic Hitman" Perkins [24:01] See also Notable Video panel for related videos by Perkins.

Commentary: "Wells Fargo Closing 450 Branches By 2019" [05/15/17] Printer Friendly Version "Wells Fargo & Co. on Thursday laid out plans to close additional branches and offer more digital tools — all part of a push to trim $2 billion in costs while trying to keep customers and attract new ones. Speaking to investment analysts at the bank’s investor day conference in San Francisco, executives said they plan to close 450 branches by the end of 2018 — 50 more than the bank had announced earlier this year — with the potential for more in 2019. [...]"  

Commentary: "McCain Institute Caught Stealing Millions In Child Trafficking Donations" [05/15/17] Printer Friendly Version "The McCain Institute claims it exists to fight human trafficking, but despite receiving millions in donations from Saudi Arabia, the Rothschilds, and Bloomberg, it has been revealed that none of the money was spent on fighting human trafficking. Funds from the McCain Presidential Campaign were also quietly funneled into the McCain Institute’s coffers raising the possibility the Institute exists as a money laundering front. The McCain Institute is a huge operation featuring upwards of 80 people including dozens of full time staff and board members including Ashton Kutcher and Lady Lynne Forrester de Rothschild. [...] Saudi Arabia donated $1,000,000 to the McCain Institute in 2014 in what looks suspiciously like a Clinton Foundation style pay-for-play “donation”, leading many to believe the secret donations explain why he has a certain “viewpoints” about the Middle East, and keeps making secret trips to Syria.[...] With millions of dollars in donations from powerful corporations, governments and billionaire bankers, not to mention John McCain’s presidential campaign money, you would think the Institute is doing all sorts of great things to stop human trafficking, right? You’d be wrong. In 2012 the Institute donated exactly $500,000. In 2013 it was $500,000 again. In 2014 it was increased to $1,500,000. Nice, round numbers. It’s almost as if the Institute did nothing else all year except sign one check to keep up the pretense they were actually doing what they tell the public they do. And to whom or what did that $2.5 million go to? Some human trafficking superfighter, you would think, right? You’d be wrong again. It all – every last penny – went to the Arizona State University Foundation (scroll down through the tax returns to see the disclosure). Which, by the way, does not appear to have anything whatsoever to do with human trafficking. Are we looking at a money laundering operation here? The McCain Institute is starting to look an awful lot like the bogus Clinton Foundation. [...]"  Related: "FBI Insider Reveals Why Jason Chaffetz Is Being Forced Out Of Politics" Printer Friendly Version "... Chaffetz effectively ended his career as an uncompromised politician in March. Chaffetz was credited with doing “the impossible” and pushing a bill through Congress ordering an audit of the Federal Reserve.[...] Explaining that the Federal Reserve, created and funded by the House of Rothschild, is an institution that many politicians “are uncomfortable with” but they “learn to leave alone“, the FBI insider said the example of Chaffetz is a textbook study of what happens when the Rothschild’s central banking scam is threatened with exposure. “Look at the history of the Fed. Name one person who stood up to the Federal Reserve and lived to tell the tale.” “I personally won’t be surprised if he [Chaffetz] reverses his decision and doesn’t retire in 2018. But he will forever he a compromised man. He bit off more than he could chew. He’s learned his lesson.“[...]"   

MSM: "China, First Country To Introduce Paper Money, On Track To Phase It Out" [05/12/17] Printer Friendly Version "Pretty much every shop, restaurant and bar accepts WeChat and/or Alipay these days," said Yuhan Xu, a 30 year-old Shanghai-based radio researcher who has used her smartphone to pay for almost all her purchases since early 2016. "Even a small pancake stall does that," she added. "I don't need to carry cash." Many experts believe it won't be long before China, the first country to introduce paper money, also becomes the first to phase it out to become fully cashless. But when will this moment come? [...] Of China's 1.35 billion population, 710 million are internet users. The results of a survey by the Beijing Youth Daily newspaper released in March found that, like Xu, 70 percent of internet users polled thought carrying cash was not necessary. The apps fuelling this cashless trend are Tencent's WeChat and Alibaba's Alipay. Launched in 2011, WeChat is a multi-function app based around a messaging system that incorporates WhatsApp and Twitter-like elements. The app is phenomenally popular in China—the majority of WeChat's roughly 889 million monthly-active users worldwide are based in the People's Republic. Chinese users of apps like WeChat tend to not be put off by the personal data storing and sharing that goes on in them. Snooping by authorities is pretty much accepted.[...]" 

Commentary: "Puerto Rico’s $123 Billion Bankruptcy Is The Cost Of U.S. Colonialism" [05/11/17] Printer Friendly Version "Puerto Rico officially became the largest bankruptcy case in the history of the American public bond market. On May 3, a fiscal control board imposed on the island’s government by Washington less than year ago suddenly announced that the Puerto Rico’s economic crisis “has reached a breaking point.” The board asked for the immediate appointment of a federal judge to decide how to deal with a staggering $123 billion debt the commonwealth government and its public corporations owe to both bondholders and public employee pension systems. [...]"  

MSM: "Puerto Ricans Face 'Sacrifice Everywhere' on an Insolvent Island" [05/09/17] Printer Friendly Version "These are some of the voices of Puerto Rico’s business owners, retirees and public servants who are caught in the middle — they would say the bottom — of the largest local government insolvency in United States history. Faced with a $123 billion debt it cannot pay, Puerto Rico filed for a kind of bankruptcy protection on Wednesday, a move that sent shivers down the spines of everyone from bond holders fearful of staggering losses to street sweepers and public employees whose already meager paychecks are likely to dwindle. [...]"  Related: See below

Commentary: "Puerto Rico Headed To Bankruptcy Court, Likely Costing Investors Billions" [05/06/17] Printer Friendly Version "The federal fiscal oversight board created by Congress last June to fix Puerto Rico gave up on Monday, putting the island country into the hands of a federal bankruptcy judge. The board, created last June, was designed to help newly elected Governor Ricardo Rossello come to terms with mutual funds and hedge fund owners that own the bulk of the island’s $73 billion debt. Rossello’s first effort, which would have applied a one-third financial “haircut” to them was turned down by the board, which called it too generous. Rossello’s second effort would have applied a 50-percent haircut, but Franklin Advisers and Oppenheimer Fund, the two largest entities holding the island’s debt, pushed back. Time ran out on May 1, and the board placed the issue before a bankruptcy court to sort it all out. Almost predictably, where billions are involved, so is Rothschild and Company, serving as Puerto Rico’s “financial adviser.” When The New American visited the issue almost exactly a year ago, government bureaucrats were earning $74,000 a year and were eligible to retire at age 47. Teachers, on the other hand (and to put that into perspective), earned just $24,000 a year, and their pension and welfare benefit plans were so underfunded that the chances of them being able to retire with anything worth mentioning were decreasing by the day. [...]" 

Commentary: "Here’s Why Trump Is Talking About Breaking Up The Biggest Wall Street Banks" [05/06/17] Printer Friendly Version "Yesterday, Bloomberg News reporters Jennifer Jacobs and Margaret Talev snagged an interview with President Donald Trump. Headlines quickly spread that during the interview Trump had indicated he was looking at breaking up the biggest Wall Street banks (so that commercial banks holding taxpayer-backstopped deposits were no longer under the same ownership as the high-risk investment banks which had failed so spectacularly during the 2008 financial crash). Bloomberg News has now released a transcript of the interview. The portion pertaining to the Wall Street banks reads as follows: [...]"

MSM: "Corporate Executives Are Selling Stocks In Droves" [05/04/17] Printer Friendly Version "A divide has formed in the US equity market. As the investing public has continued to devour stocks, sending all three major indexes to record highs in the last few months, corporate insiders have been offloading shares to an extent not seen in seven years. Selling totaled $10 billion in March, according to data compiled by Trim Tabs. It's a troubling trend facing an equity market that's already grappling with its loftiest valuations since the 2000 tech bubble. If the people with the deepest knowledge of a company are cashing out, why should investors keep buying at current prices?  The groundswell of insider selling has the attention of Brad Lamensdorf, portfolio manager at Ranger Alternative Management, and he doesn't like what he sees. "This is definitely a negative sign," Lamensdorf wrote in his April newsletter. "They do not see value in their own companies!" [...] One possible explanation is that insiders have been unable to resist the allure of collecting profits with many of their stocks trading at unprecedented levels. Still, that begs the question of why a person would do that if they were at all confident that shares would continue to rise. No matter how you slice it, it's a bad sign for the average investor. In addition to high valuations, Lamensdorf cites rising rates as a risk facing the stock market. As the Federal Reserve continues hiking, an increasing number of companies will be unable to meet interest payments, exposing them to default, he says. As such, his portfolio is 50% net short. Not all market experts are as pessimistic. Wall Street strategists see the S&P 500 grinding 1.5% higher from Monday's close through year-end, according to a 19-person survey conducted by Bloomberg.[...]" 

Commentary: "Why Deutsche Bundesbank Had To Promise To Leave 1200 Tons Of Gold In New York" [05/01/17] Printer Friendly Version "With big fanfare, Deutsche Bundesbank announced on February 9 that ahead of plan they had repatriated 300 tons of gold from New York. This put a positive spin on a rather disturbing fact –1236 tons of gold that is supposed to be part of Germany’s currency reserve will continue to be kept outside of German control in New York – indefinitely. The German gold in question is being kept in storage at the New York Fed, an institution that is owned and controlled by Wall-Street-banks, in a country, whose current president considers it an imposition that the law and so-called judges tell him what he is allowed to do and not allowed to do. I am not criticizing the Bundesbank for storing 37 percent of Germany’s official gold in in a place there it has no control over it. It seems clear that they negotiated hard with the US and acted rather shrewdly. Their negotiation position was much enhanced in 2012 by the leakage of a report of the German Court of Auditors, which was very critical of the conditions under which German gold was being held in New York. This created public and political pressure on the Bundesbank to renegotiate and to get that gold out of New York. At the same time, the US-side could hardly afford to snub this demand, because there was lots of speculation, even in the US, that something was amiss with the gold reserves of the US and the rest of the world that were stored in the country. The way in which the official gold of the US, and the gold held in custody for other countries, is guarded against public scrutiny and shielded from its owners, gives fodder to any number of conspiracy theories. Had the New York Fed refused to let a foreign central bank, which was under such obvious pressure, retrieve some of their gold, these conspiracy theories around official gold might very well have become intense enough to damage trust in the dollar. [...]" 

MSM: "US Consumers Tap Out: Credit Card Defaults Surge To 4 Year High" [04/27/17] Printer Friendly Version "Two weeks ago, when JPMorgan launched Q1 earnings season, we noted that while the results were generally good, one red flag emerged: the company's credit card charge offs rose to just shy of $1 billion, the highest in four years. [...]"  

MSM: "Kremlin Advisor Reveals 'Cure For US Aggression" [04/24/17] Printer Friendly Version "The only way to stop the United States’ aggression is to get rid of dollar addiction, a Kremlin advisor said on Friday. "The more aggressive the Americans are the sooner they will see the final collapse of the dollar as the only way for the victims of American aggression to stop this aggression is to get rid of the dollar. As soon as we and China are through with the dollar, it will be the end of the United States’ military might," Sergey Glazyev said in an interview with TASS. Commenting on the policy of the new US president, Glazyev noted that Donald Trump is doing what the ruling elite expects him to do. "I had no illusions about him, that he will change the policy. First, America’s aggressiveness in the world is rooted in the aspiration to preserve America’s hegemony in a situation when they have already ceded leadership in the economy to China," he said. "The United States has no tools to make all others use the dollar other than a truncheon. That is why they are indulging in a hybrid war with the entire world to shift the burden on their debts onto other countries, to confine all to the dollar and weaken territories they cannot control."[...] "In this context, the anti-Russian hysteria and growing Russophobia can be seen as a long-term factor linked with the specific interests of the United States’ ruling elite," the Kremlin advisor said. "In objective terms, they are conducting a global hybrid war and in subjective terms, this war is aimed against us. More to it, as it always happens when a global leader is changed, the war is for control over rimland nations. In the period of WWI and WWII, Britain acted as a provoker in a bid to keep its global leadership. Now the United States is doing the same. And Trump expresses these interests," he said. [...]" 

MSM: "Investors Rage After 3 Billion Yuan Vanish From China's Largest Private Bank" [04/19/17] Printer Friendly Version "Theoretical warnings about risks inherent in China's shadow banking system became all too for 150 customers of China's largest private bank, when Minsheng Banking Corp found itself involved in a 3 billion yuan (US$436 million) fraud case, after it emerged that a branch chief of the lender in Beijing allegedly issued false bank acceptance bills and later secured funds from individual investors to cover up the misdeed. According to SCMP, an accidental inquiry from an investor exposed the fact that the WMPs sold by a Minsheng branch didn’t even exist. When shocked investors rushed to the bank, they found the head of the branch had been taken into police custody and the supposed due payment date had passed. [...] A little background: bank acceptance bills, one of the shadier funding pathways of China's shadow banking system, and a form of bank-backed IOU, are commonly used as a form of payment between Chinese companies. The holder of such bills is entitled to cash the bill at a bank under any circumstances... unless of course fraud is involved. It is different from commercial acceptance bills, which are issued by companies and do not guarantee repayment despite companies’ trustworthiness. Well, in this case fraud was involved. The branch head at the Beijing branch of Minsheng, Zhang Ying, allegedly helped a corporate client disguise commercial acceptance bills as bank acceptance bills by using a false seal of the bank. The bills were issued by the client to a number of companies, which later discovered the bills were fake, Caixin said. Then, in order to cover up the fact that the fake bills were not able to be cashed by the bank, Zhang later sold 3 billion yuan of unauthorized wealth-management products to the bank’s private customers to get funds for the client to repay the bills. Caixin said a huge amount of funds may be transferred between the client and Zhang.[...]" 

Commentary: "Has Former Goldman Sachs President, Gary Cohn, Gone Rogue On Glass-Steagall?" [04/18/17] "There are a few important things to know about Gary Cohn. Until Donald Trump tapped him to be the Director of the National Economic Council, he had worked at Goldman Sachs for a quarter century, rising to the position of President of the firm and second only to its CEO, Lloyd Blankfein. Cohn walked out of Goldman in December with approximately $285 million, comprised mainly of Goldman stock, some of which had been granted early vesting. Since his exit from Goldman, Cohn has wasted no time in selling large chunks of his Goldman shares according to his financial disclosures. While this serves to reduce his conflicts of interest with Goldman, it also provides a face-saving means of exiting a massive position in a Wall Street bank without the appearance of panic or disloyalty. [...]" 

MSM: "Biggest Aluminum Producer Faces Default, Warns "Dramatic Social Unrest" Without Beijing Bailout" [04/17/17] "Step aside China Huishan Dairy Holdings - China's largest dairy producer which cratered last month after a negative Muddy Waters research report brought attention to a company we knew for one year was collateralizing its cows to fund stock buybacks - and make way for what may be the next Chinese megafraud. While China Hongqiao Group may be best known for being the world's largest aluminum producer, it has in recent months featured just as prominently among short-seller reports who have accused the company of being a fraud. As the WSJ's Scott Patterson writes, questions about China Hongqiao’s finances first emerged in November, when an anonymous short seller wrote on a website called Hongqiao Exposed that the company’s profits are “too good to be true.” China Hongqiao in the March 31 statement called the report “untrue and unfounded.” A subsequent 46-page report on Feb. 28 by Emerson Analytics, a trading firm focused on Chinese stock-market fraud, disclosed more allegations of fraud involving the Chinese commodity giant. [...]" 

MSM: "Out Of Cash" - More Than 90% Of India ATMs Run Dry" [04/17/17]  "Five months have passed since the demonetisation drive, but the people of India continue to face a shortage of cash in banks and ATMs. The Times of India reports that more than 90% of the ATMs in the northern region do not have cash, and in the southern states as many as 65% of ATMs have run dry. [...] Speaking to TOI, State Bank of India (SBI) deputy general manager Ajoy Kumar Pandit said the customers are losing confidence in them due to the crisis. "Nearly 70 per cent of our 648 ATMs in the three districts are out of cash. The rest will also become dry in the next few days as we do not have cash to refill the machines. We are helpless from our side," he said. A banking source said the RBI has diverted most of the cash to north India due to the recent elections. This has affected the southern parts of the country. "The government's intention is to encourage smart payment systems, but the infrastructure is not up to the mark," the source said. Many ATMs have not been upgraded with the new software required for handling the new Rs 500 and Rs 2,000 denominations, the source added.[...]"  

Commentary: "Americans Owe $1 Trillion In Credit Card Debt Due To Rising Interest Rates" [04/17/17] "Americans owe a whopping $1 trillion in credit card debt thanks to rising interest rates, according to data from the Federal Reserve. Federal Reserve data released April 7 shows that U.S. consumers owe $1.0004 trillion on credit cards, up 6.2 percent from a year ago and 0.3 percent from January, according to Dow Jones newswires. The New York Post reports that U.S. consumers who do not pay off their credit card bill each month carry an average monthly balance of about $9,600. [...] The price of goods and services have increased at a much faster pace than wages for the average working person. Medical costs increased by 57 percent, food prices soared by 36 percent, and housing costs spiked by 32 percent since 2003" 

Commentary: "NATO’s Weapon of Choice-Transatlantic Banking Powers" Newsbud [04/15/17] [39:07] "Newsbud presents and welcomes the newest addition, Pye Ian, to its team. Mr. Ian is an independent economic researcher and analyst with undergraduate degrees in economics and political science from the University of California and a Master’s degree in finance from Cambridge University. In this exclusive interview with Sibel Edmonds Pye Ian discusses his latest article NATO’s Currency War against Turkey, and explains how NATO uses mega banks and rating agencies in its covert war against target nations’ perceived noncompliance with its geostrategic goals. [...]" 

MSM: "2017 Debt Crisis Looms: Congress Will Have 4 Days To Avoid A Government Shutdown On April 29" [04/13/17] "April 2017 could turn out to be one of the most important months in U.S. history that we have seen in a very long time. On April 6th, Donald Trump attacked Syria on the 100th anniversary of the day that the U.S. officially entered World War I, and now at the end of this month we could be facing an unprecedented political crisis in Washington. On Friday, members of Congress left town for their two week “Easter vacation”, and they won’t resume work until April 25th. What this means is that Congress will have precisely four days when they get back to pass a bill to fund government operations or there will be a government shutdown starting on April 29th. Up to this point, there has been very little urgency by either party to move a spending bill forward. It is almost as if everyone is already resigned to the fact that a government shutdown will happen. The Democrats will greatly benefit from a government shutdown because they can just blame the entire mess on the Republicans. But for the GOP, this is essentially the equivalent of political malpractice. To me, there is simply no way that Congress is going to be able to agree on a bill that funds the entire government in just four days. And it turns out that this upcoming deadline comes exactly on the 100th day of Trump’s presidency… [...]" Related: "Corrupt Congress Heads Out For Vacation As Government Shutdown Looms" Printer Friendly Version Members of Congress have headed back to their districts for a two-week recess after one of the most bitterly divided sessions in history that culminated with Republicans launching the 'nuclear option' to confirm Supreme Court Justice Neil Gorsuch. Unfortunately, upon their return to Washington DC, they will have just 5 days to unveil, debate and pass a spending bill, or trigger a government shutdown on April 28.

MSM: "Fed's Kaplan Warns Trump "US Too Leveraged To Use Debt For Growth" [04/13/17] Printer Friendly Version "Federal Reserve Bank of Dallas President Robert Kaplan had lots to say this morning that, for now, the market has chosen to ignore. He warned "we are highly leveraged" implicitly warning President Trump that the country’s ability to boost growth through debt is limited.  [...]" 

MSM: "Smoking Gun' Recording Entangles Bank of England in Libor Rigging Scandal" [04/12/17] Printer Friendly Version "A secret recording implicating the Bank of England in the Libor rigging scandal has been uncovered, the first potential "smoking gun" evidence of the central bank's long-suspected role in compelling UK commercial banks to artificially drive down their lending rates during the financial crisis. [...]"

Commentary: "The Reason The Federal Gov't Has Been Keen to Blame Russia for Everything: Gold" Ø Hedge [04/06/17] "How would you feel if you had planned a gathering of your closest family and friends and your list of invites grows to include some 185 guests. You also invited your known trouble-making cousin. Your cousin shows up drunk, armed and belligerent. He begins harassing a good portion of the guests, smashes some of your prized possessions and then, as an added bonus, he shoots and kills 12 of your guests.  As your cousin is leaving the gathering, he takes your wallet and your wife’s purse. He also goes in your bedroom, opens your safe and removes all your gold and silver. Your cousin now has all your credit and debit cards and all the cash you had on hand. You can not conduct business in any manner. You can’t even pay the caterer for their services. If this sounds like a horrific story, you’re right - it is. The drunken cousin is a metaphor for how the U.S. has been acting for the past several years and how it has treated countries around the world. Do you suppose some of these nations are more than a little tired of being treated in this manner? Do you suppose that instead of acting as this oppressive “cousin” acts that some of these countries would find it better to simply develop a way to leave the “gathering” in a peaceful manner and get on with their own business?  [...]  As we reported on March 30, China and Russia are taking steps to move away from their out of control “cousin”, the Federal Reserve Note, U.S. dollar, world reserve currency. We learned in March 2016 that Kazakistan had been in formal talks with the Shanghai Gold Exchange regarding gold as currency along the New Silk Road (One Belt One Road) spearheaded by China. Kazakistan also smelts most of Russia’s gold and mines a small amount gold annually and is a member of both the Shanghai Cooperation Organization (SCO) and Eurasia Economic Union (EEU).  Then, in October of 2016 we continued covering how China had been working directly with the IMF to get the yuan/renminbi currency added to the SDR basket of currencies for global trade. That now appears to be a cover story for what lay ahead. With the renminbi now a global currency that changes how the renminbi functions within the currency markets and in global trade negotiations. [...] China began working their CIPS system, global trade settlement system, in October 2016, the same time the renminbi joined the SDR basket, allowing China to conduct global trade outside the U.S. owned and operated SWIFT system. Both systems are used to settle global trade transactions and the SWIFT system has been geared to the Federal Reserve Note – U.S. dollar – while the CIPS system is geared to the Chinese renminbi. [...]" 

Commentary: "Pension Crisis Too Big For Markets To Ignore" [04/03/17] Printer Friendly Version "... Unfunded pension obligations have risen to $1.9 trillion from $292 billion since 2007. Credit rating firms have begun downgrading states and municipalities whose pensions risk overwhelming their budgets. New Jersey and the cities of Chicago, Houston and Dallas are some of the issuers in the crosshairs. Morgan Stanley says municipal bond issuance is down this year in part because of borrowers are wary of running up new debts to effectively service pensions. [...] Federal Reserve data show that in 1952, the average public pension had 96 percent of its portfolio invested in bonds and cash equivalents. Assets matched future liabilities. But a loosening of state laws in the 1980s opened the door to riskier investments. In 1992, fixed income and cash had fallen to an average of 47 percent of holdings. By 2016, these safe investments had declined to 27 percent. It’s no coincidence that pensions’ flight from safety has coincided with the drop in interest rates. That said, unlike their private peers, public pensions discount their liabilities using the rate of returns they assume their overall portfolio will generate. In fiscal 2016, which ended June 30th, the average return for public pensions was somewhere in the neighborhood of 1.5 percent. Corporations’ accounting rules dictate the use of more realistic bond yields to discount their pensions’ future liabilities. Put differently, companies have been forced to set aside something closer to what it will really cost to service their obligations as opposed to the fantasy figures allowed among public pensions. [...] So why not just flip the switch and require truth and honesty in public pension math? Too many cities and potentially states would buckle under the weight of more realistic assumed rates of return. By some estimates, unfunded liabilities would triple to upwards of $6 trillion if the prevailing yields on Treasuries were used. That would translate into much steeper funding requirements at a time when budgets are already severely constrained. Pockets of the country would face essential public service budgets being slashed to dangerous levels.[...]" 

Commentary:  "Moscow, Beijing Join Forces To Bypass Dollar In Global Markets, Shift To Gold Trade" Ø Hedge [04/03/17] Printer Friendly Version "The Russian central bank opened its first overseas office in Beijing on March 14, marking a step forward in forging a Beijing-Moscow alliance to bypass the US dollar in the global monetary system, and to phase-in a gold-backed standard of trade. According to the South China Morning Post the new office was part of agreements made between the two neighbours "to seek stronger economic ties" since the West brought in sanctions against Russia over the Ukraine crisis and the oil-price slump hit the Russian economy. According to Dmitry Skobelkin, the deputy governor of the Central Bank of Russia, the opening of a Beijing representative office by the Central Bank of Russia was a “very timely” move to aid specific cooperation, including bond issuance, anti-money laundering and anti-terrorism measures between China and Russia. The new central bank office was opened at a time when Russia is preparing to issue its first federal loan bonds denominated in Chinese Yuan. Officials from China’s central bank and financial regulatory commissions attended the ceremony at the Russian embassy in Beijing, which was set up in October 1959 in the heyday of Sino-Soviet relations. Financial regulators from the two countries agreed last May to issue home currency-denominated bonds in each other’s markets, a move that was widely viewed as intended to eventually test the global reserve status of the US dollar. [...]" Bypassing the US dollar appears to be paying off: according to the Chinese State Administration of Taxation, trade turnover between China and Russia increased by 34% in January, in annual terms. Bilateral trade in January 2017 amounted to $6.55 billion. China’s exports to Russia grew 29.5% reaching $3.41 billion, while imports from Russia increased by 39.3%, to $3.14 billion. Just as many suspected, with Russian sanctions forcing Moscow to find other trading partners, chief among which China, this is precisely what has happened. The creation of the clearing center enables the two countries to further increase bilateral trade and investment while decreasing their dependence on the US dollar. It will create a pool of Yuan liquidity in Russia that enables transactions for trade and financial operations to run smoothly.[...]"  

MSM: "Toshiba’s Nuclear Unit Westinghouse Files For US Bankruptcy" [04/02/17]  Printer Friendly Version "Following multibillion-dollar losses, Toshiba’s American nuclear unit Westinghouse filed for US bankruptcy protection on Wednesday. The troubled firm has thrown its Japanese parent company into crisis, putting the conglomerate's future at risk.  [...]"   

Concepts and Practices: "Indian Central Bank Arbitrarily Outlaws Bitcoin" [04/01/17] Printer Friendly Version "There was a huge hit on March 28 for Bitcoin proponents as a nation with nearly 20% of the world's population has officially declared the crypto-currency to be an outlaw form of money, and that users of Bitcoin could be considered to be money launderers. In a statement made by the Indian government in collaboration with comments made recently by their central bank, use of any virtual currency other than the Rupee is to be considered unauthorized and users to be assumed as money launderers upon investigation. [...]"  

Date With Destiny: "Hedge Fund Exec Who Fell Prey To Madoff Scheme Plunges 20 Stories" [04/01/17] Printer Friendly Version "A hedge-fund executive whose firm lost millions of dollars in the Bernie Madoff investment scheme jumped to his death, falling 20 stories from a luxury Manhattan hotel. The apparent suicide is the latest connected to the Madoff scandal.  Charles Murphy’s hedge fund, Fairfield Greenwich Group, invested more than $7 billion in Madoff’s wealth management firm – only to take a hard hit when the operation was revealed to be the largest Ponzi scheme in US history. [...] Murphy’s suicide is the latest connected to the Madoff scam. Madoff’s son, Mark, hanged himself in 2010. Investor and former Army Major William Foxton killed himself in 2009 after going bankrupt, and Rene Thierry Magon De La Villehuchet, whose firm AIA Group lost $15 billion in the scheme, was found dead in 2008, according to reports.[...]" 

Commentary: "The Overlapping Crises Are Coming, Regardless Of Who's In Power" [03/28/17] Printer Friendly Version "Commentators seem split into three camps: those who see Trump as a manifestation of smoldering social/economic ills, those who see Trump and his supporters as the cause of those ills, and those who see Trump as both manifestation and cause of those ills. I think this misses the point, which is the overlapping crises unfolding in this decade-- diminishing returns on skyrocketing debts, the demographics of an aging populace, the erosion of the social contract and the profound disunity of political elites--will continue expanding and feeding on each other regardless of who is in power. Historical analysis seems to swing between the "Big Man/Woman" narrative that views individuals as the drivers of history, and the "Big Forces/it's all economics" narrative that sees individual leaders as secondary to the broad sweep of forces beyond the control of any individual or group. [...] So while the mainstream views President Lincoln as the linchpin of the Civil War--his election triggered the southern secession--from the "Big Forces/it's all economics" view, Lincoln was no more than the match that lit a conflict that was made inevitable by forces larger than the 1860 election. The tension between these two narratives is valuable, as history cannot be entirely reduced to individual decisions or broad forces (weather, resource depletion, financial crisis, geopolitical upheaval, demographics, plague, etc.). The dynamic interplay between the two shapes history. Individuals do matter--but they cannot offset structural crises for long. Which brings us to Trump. The status quo is falling apart for profoundly structural reasons: promises made when growth was robust, debt was modest, energy was cheap and abundant and the work force was far more numerous than those dependent on the central state's "pay as you go" pension and welfare programs-- these promises made in yesteryear can no longer be kept, regardless of who's in power.[...]"  

MSM: "Chinese Banks, HSBC Caught Up In Huge Money Laundering Scam" [03/23/17] Printer Friendly Version "Several of China’s state-controlled banks, as well as HSBC’s Hong Kong branch, have allegedly processed hundreds of millions of US dollars from a vast money-laundering operation run by Russian criminals with links to the Russian government and the spy agency FSB. Documents obtained by the Organized Crime and Corruption Reporting Project show that at least US$20 billion was moved out of Russia between 2010 and 2014 in a vast criminal operation called “The Global Laundromat”. Over that period, Bank of China – one of the biggest state-owned commercial banks in China – processed a total of US$716 million of the Laundromat cash via branches in mainland China, Hong Kong and Macau, making it the fourth most active bank in the plot, as shown by the documents. [...]"  Related: Flashback: "Comey Oversaw Cartel Money Laundering Ops As A Top Executive At HSBC Bank" Printer Friendly Version "Before becoming the director of the FBI, Director Comey, worked at the criminal bank of HSBC which laundered drug cartel and terrorist drug money in the worst banking scandal in US history. My best insider source states that FBI Director James Comey has absolutely no law enforcement background, and is not qualified to run the FBI. To add insult to injury, the FBI Director held an executive position at HSBC Bank, while extreme money laundering operations where being carried out by the Mexican Drug Cartel and their terrorist allies with the direct assistance of HSBC banking officials. I asked my source if Comey would have known, and he replied “he would have to have been drunk 24/7 to not know what was going on”.  [...]" | "Videos: More Info On Comey And HSBC"

Commentary: "Deutsche Bank Linked To Russian Money Laundering Scam" [03/23/17] Printer Friendly Version "Deutsche Bank is one of dozens of western financial institutions that processed at least $20bn – and possibly more – in money of “criminal origin” from Russia. The scheme, dubbed “the Global Laundromat”, ran from 2010 to 2014. Law enforcement agencies are investigating how a group of politically well-connected Russians were able to use UK-registered companies to launder billions of dollars in cash. The companies made fictitious loans to each other, underwritten by Russian businesses.  The companies would default on these “debts”. Judges in Moldova then made court rulings enforcing judgments against the firms. This allowed Russian bank accounts to transfer huge sums to Moldova legally. From there, the money went to accounts in Latvia with Trasta Komercbanka. Deutsche, Germany’s biggest lender, acted as a “correspondent bank” for Trasta until 2015. This meant Deutsche provided dollar- denominated services to Trasta’s non-resident Russian clients. This service was used to move money from Latvia to banks across the world. During this period many Wall Street banks got out of Latvia, citing concerns that the small Baltic country had become a centre for international money laundering, especially from neighbouring Russia. In 2013, and under US regulatory pressure, JP Morgan Chase ceased providing dollar clearing services to the country. From 2014, only two western lenders were willing to accept international dollar transfers from Latvian banks. They were Deutsche and Germany’s Commerzbank. Deutsche eventually withdrew correspondent services to Trasta Bank in September 2015.  [...]" Related: "British Banks Handled Vast Sums Of Laundered Russian Money" Printer Friendly Version "Billions of dollars were moved out of Russia in ‘Global Laundromat’ operation, with anonymously owned UK companies playing major role [...]"  Note: 'Laundromat' funnels illicit funds out of Russia: Banks in Moldova and Latvia help Russians take billions of dollars out of their country bypassing strict money laundering rules. The massive operation has been dubbed 'The Laundromat' by anti- corruption activists. Source | "UAE Named In $20bn Russian Money Laundering Scheme" Printer Friendly Version 

Commentary: "The Stock Market Illusion Explained" [03/23/17] [9:18] "The "wealth" created by rising stock prices is just an illusion, explains the Health Ranger in this educational animation video. Follow the math and you'll realize how stock market "wealth" is almost entirely fictional... which is why it can disappear so quickly in a crash. 3.21.17 [...]" 

MSM: "World Stocks Seen As Most Overvalued In 17 Years" [03/23/17] Printer Friendly Version "World stocks are their most expensive in 17 years, but bond yields will need to be much higher than they are currently to trigger an equity bear market, a monthly fund manager survey showed on Tuesday. Bank of America Merrill Lynch's (BAML) poll of investors managing $592 billion worldwide was conducted from March 10-16, a period that saw Wall Street's recent string of record highs fizzle out and the Federal Reserve raise U.S. interest rates. [...]" 

MSM: "Foreign Banks Retreat From Lending To U.S." [03/22/17] Printer Friendly Version "Lending in the U.S. by foreign banks has started to contract. The contraction of foreign loans comes at a time when loan growth by U.S. banks has been slowing. Year over year loan growth by the 25 largest U.S. banks fell to around 3.35% in early March, down from 7.18% a year earlier. Overall loan growth by commercial banks has fallen to around 4.28%. For most of last year, foreign banks were growing loans at a faster pace than their U.S. counterparts. That changed in the final weeks of 2016, when foreign bank loan growth began declining rapidly. [...]"  

Commentary: "The True Legacy Of David Rockefeller" [03/21/17] Printer Friendly Version "No one person encapsulates the enduring legacy of the “robber barons” of the Industrial Age quite like David Rockefeller. Rockefeller, who just died at the age of 101, was the last surviving grandson of John D. Rockefeller, the oil tycoon who became America’s first billionaire and the patriarch of what would become one of the most powerful and wealthiest families in American history. David Rockefeller, an undeniable product of American nobility, lived his entire life in the echelons of U.S. society, becoming symbolic of the elite who often direct public policy to a much greater extent than many realize, albeit often from the shadows. Rockefeller made it clear that he preferred to operate out of public view despite his great influence in American – and international – politics. Due to his birthright, Rockefeller served as an advisor to every president since Eisenhower, but when offered powerful positions such as Federal Reserve chairman and Secretary of the Treasury – he declined, preferring “a private role.” As evidenced by the numerous obituaries bemoaning the loss of the last of the Rockefeller’s grandsons, he was largely successful in hiding his most significant wrongdoings from public view, as evidenced by his characterization as a generous philanthropist and influential banker.[...] In addition to having the ear of every U.S. president for the better part of the last 70 or so years, Rockefeller – once again operating “behind the scenes” – was instrumental in shaping the more cringe-worthy aspects of U.S. policy during that time, as well as being a major force in establishing banking policies that led to debt crises in the developing world. Rockefeller – as the head of Chase Manhattan Bank from 1969 to 1981 – worked to create a “global order” unequivocally dominated by the 1 percent, of which his family was a part. As the New York Times noted back in the 1970s, Rockefeller became embroiled in controversy when his constant trips overseas caused the bank to become less profitable, as he prioritized the bank’s influence on foreign politics over its actual business dealings."  During his time as Chase CEO, Rockefeller helped laid the foundation for repressive, racist and fascist regimes around the world, as well as architecture for global inequality. In addition, Rockefeller helped to bring the debt crisis of the 1980s into existence, in part by direct action through Chase Bank and also indirectly through his former employee-turned-Federal Reserve chairman Paul Volcker. Two years before the debt crisis erupted, Rockefeller, Volcker and other top bankers met at the International Monetary Conference in 1980s to argue for the establishment of a “safety net” for major banks – like Chase – that were embroiled in bad loans given largely to countries in the developing world. [...] After the crisis brought financial ruin in developing areas throughout the world, Rockefeller – along with other bankers – created "austerity programs" to “solve” the debt crisis during subsequent IMC meetings, provoking inequality that still persists to this day. Thanks to the “safety net” conveniently established years prior, Chase avoided the economic consequences for its criminal actions. Rockefeller supported the bloody and ruthless dictatorships of the Shah of Iran and Augusto Pinochet of Chile while also supporting Israeli apartheid. Rockefeller founded the influential Trilateral Commission while also serving as a major force on the Council on Foreign Relations that he, along with his close friend Henry Kissinger, would come to dominate. Both of these organizations have come under fire for using their powerful influence to bring about a “one-world government” ruled by a powerful, ultra-wealthy elite – an accusation to which David Rockefeller confirmed as true in his autobiography. David Rockefeller deserves to be remembered for his true legacy – one of elitism, fascism and economic enslavement." Related: "David Rockefeller Dies At 101" Printer Friendly Version Note: I guess his 6th heart transplant in 2016 didn't do this corrupt reincarnated retread any good. Good riddance! I hope he tries to reincarnate here quickly (if even allowed by the game at this point because of the proximity of graduation), because he would be just in time to die again when the graduation dynamic on Earth goes full tilt and he will end up being born yet again in another body on some sequential planet out there, and has to fit into a pre-existing hierarchy, having dug himself deeper into his existential loops. He will have plenty of company.    

Commentary: "Hedge Fund CIO: "Odds Of Trump Succeeding Zero In Absence Of New War" Ø Hedge [03/20/17] Printer Friendly Version "We present the latest weekly anecdote, From Eric Peters, CIO Of One River Asset Management: “You know what I dislike about my own argument?” asked the CIO. “I sound defensive, like I can’t accept I’m wrong.” We all know that guy, and rarely want to be him. “No one ever truly believed in my thesis,” he said, describing it: A growing dominance by the global economic elite shapes policy to deliberately asphyxiate dynamism. Because dynamism and its fraternal twin – volatility - are the only real threats to an entrenched elite. Rising income inequality is an obvious manifestation of this process. As the cost of raising children soars, declining birth rates are too. It’s why our students are drowning in debt and now rent for life. If they fall ill, it’s why laws prohibit them from declaring bankruptcy on college loans. It’s why big firms are bailed out, and why incumbents are securely gerrymandered, rarely unseated. Peel back the patina and you’ll discover that today’s monetary policy, tax policy, foreign policy, trade policy, and regulations of every stripe are levers the elite pull to entrench their interests. Secular stagnation is what we came to call the symptom without identifying this cause. Then came a synchronized global cyclical recovery, which we may now confuse as a Trump inspired break from this stranglehold. “If I thought our new president could increase budget deficits by another 2% per year, my thesis would crumble. I’d be wrong. But the odds of this are zero in the absence of starting a new war.” He paused, considering the rebound in interest rates, the record equity highs. “Am I just looking for reasons to support my position?” he asked aloud, interested only in his own answer. “I’ve been wrong on trades, but never on a big structural theme. That’s because I only bet really big when I’m absolutely convinced. And I’m pretty sure I’m still right.” [...]" 

MSM: "Janet Yellen Gives Useless Answers To Bloomberg's Question About Rate Hikes " [03/17/17] [5:06] "Today's FOMC press conference was the standard affair. Reporters ask broad questions, Yellen responds with even broader comments that amble aimlessly leaving no one any wiser as to The Fed's true intent. That is, until Bloomberg TV's Kathleen Hays decided enough was enough, and wanted to get to the bottom of just why a "data-dependent" Fed is hiking in a world in which economic data is rapidly deteriorating. [...]"  Related: "Startled Reporter Asks Why Yellen Hiked With GDP And Real Wages Sliding: Here Is The Response" Printer Friendly Version  w/Charts

Commentary: "China Is Again Selling US Treasuries As Foreign Central Banks Liquidate $45BN" [03/17/17] Printer Friendly Version "After December's brief dead cat bounce, in which foreign central banks bought $18.6 billion in US Treasuries, breaking a streak of 12 consecutive months of selling, in January they resumed their liquidation. According to the just released TIC data, foreign official institutions, which includes mostly central banks, but also sovereign wealth funds and various other official entities, sold another $44.9 billion in Treasuries, in line with the aggressive selling seen for most of 2016. [...]"  

Commentary: "Trump Picks Another Goldman Banker For Treasury Deputy" [03/15/17] Printer Friendly Version "Donald Trump has selected yet another Goldman Sachs executive to fill a senior role in his administration, naming the firm’s current managing director, James Donovan, to serve as deputy Treasury secretary. Donovan would be the sixth member of Trump’s team with ties to Goldman, which was once described as “a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.” Donovan’s now-boss, Treasury Secretary Steven Mnuchin, also worked at the investment bank. National Economic Council director Gary Cohn; White House senior counselor for economic initiatives Dina Powell; and chief strategist Steve Bannon also formerly held positions within the very institution that Trump pointed to on the campaign trail as a symbol of Wall Street corruption and greed. Jay Clayton, Trump’s nominee to lead the Securities and Exchange Commission (SEC), was a Goldman Sachs attorney. The hypocrisy didn’t go unnoticed on social media: Goldman Sachs alum who is Trump’s Treasury sec’y picks Goldman exec to be his deputy. So much populism, it’s tiring.[...] Donovan must be confirmed by the U.S. Senate. [...]" 

Convolutions: "Russia's Largest Bank Confirms Hiring Podesta Group To Lobby For Ending Sanctions" [03/10/17] Printer Friendly Version "Russia's largest bank, Sberbank, has confirmed that it hired the consultancy of Tony Podesta, the elder brother of John Podesta who chaired Hillary Clinton's presidential campaign, for lobbying its interests in the United States and proactively seeking the removal of various Obama-era sanctions, the press service of the Russian institution told TASS on Thursday. "The New York office of Sberbank CIB indeed hired Podesta Group. Engagement of external consultants is part of standard business practices for us," Sberbank said.  [...] Related: "Abby Martin Exposes Podesta’s Political Rise, Network Of Shady Corporations, Brutal Dictatorships, Media Collaborators" [23:51] 

Commentary: "Mnuchin Calls on Ryan to Raise the Debt Ceiling ASAP" [03/10/17] Printer Friendly Version "In a letter to House Speaker Paul Ryan, Mnuchin pointed out that the suspension of the statutory debt limit will expire on Wednesday, March 15, 2017. The following day, the outstanding debt of the United States will be at the statutory debt limit. At that point, the Treasury will begin to take “extraordinary measures” to prevent the U.S. from defaulting on its debt, Mnuchin wrote in the letter dated March 8. “As I said in my confirmation hearing, honoring the full faith and credit of our outstanding debt is a critical commitment. I encourage Congress to raise the debt limit at the first opportunity so that we can proceed with our joint priorities,” Mnuchin wrote. Mnuchin said that the Treasury will begin by suspending the issuance of certain special purpose Treasury securities to state and local governments. The debt ceiling is statutory limit set by Congress on the total amount that the U.S. Treasury can borrow. It is currently set at $20.1 trillion but was suspended in late 2015. At the end of the fourth quarter of 2016, the debt of the U.S. government had reached nearly $20 trillion. Mnuchin’s letter makes it clear that we will have reached the limit when the current suspension expires next week. The debt of the U.S. government has more than doubled from the $9.2 trillion owed at the end of 2007. It began rising rapidly with the onset of the Great Recession and financial crisis. [...]" 

Commentary: "When Deutsche Bank Wobbles, Wall Street Gets Shaky Knees" [03/08/17] Printer Friendly Version "Yesterday, the German global bank, Deutsche Bank, fell by 3.82 percent by the close of trading on the New York Stock Exchange on news of a capital raising and revamp in strategy. That price action took down every major Wall Street bank stock and, interestingly, MetLife, which closed down 1.64 percent, beating out even Citigroup which closed down 1.18 percent. The rest of the major derivatives players fared as follows: JPMorgan Chase closed with a loss of 0.95 percent; Bank of America was off by 0.75 percent; Morgan Stanley closed down 0.56 percent; with Goldman Sachs down a meager 0.35 percent after infusing itself throughout the Trump administration’s corridors of power in Washington. Last June, Deutsche Bank found itself the subject of unwanted attention in a report issued by the International Monetary Fund (IMF). The report looked at the “Financial System Stability” of German financial institutions and examined the systemic impact that a major bank blowing up would have on other domestic German banks and insurers as well as financial stability in other countries. The report concluded that spillover effects would not be limited to Germany but would impact France, the U.K. and the U.S. The troubling report called out Deutsche Bank as “the most important net contributor to systemic risks.” (See chart above.) Its findings included the following: [...]" Related: See below

Commentary: "Strange Deaths: Yet Another Banker Death ..." [03/08/17] Printer Friendly Version "Just when you thought there couldn't possibly be another banker jumping off the top of buildings, it has happened again, and in a strange context, for there has been a death of a bio-terrorism expert as well. Let's take the banker death first, then the bioterrorism expert's death, and then my "high octane speculation of the day." [...] The article states that Mr. Kevin Bell, a 47 year old investment banker, had been depressed, on medications, and of course, jumped to his death. Implication: suicide because of "depression." This said, there is a disturbing pattern here, for the unfortunate Mr. Bell does fit a pattern we've seen elsewhere, of bankers in London, Paris, and Hong Kong walking off the rooftops or high balconies of buildings, or walking in front of trains, and so on. In one case, of course, we've seen the death of a banker in the mortgage business dying of several nails from a nail gun to the head. And in one instance, death by gunshot - ruled a suicide - even though the victim-shooter managed to put the gun that did the deed into the glovebox of his car, after the deed. In Mr. Bell's case, after the article manages to mention his depression and that he was "taking medications", with the clear implication of Mr. Bell's death being a suicide, the Post article then mentions this little tidbit, a "tidbit" I cannot help but qualify as "greasy and suspicious": Bell, a graduate of Duke University, worked at Arrowgrass Capital Partners, where he was head of credit risk, according to his LinkedIn page. He previously worked at Saba Capital Management, Citadel Investment group, Citigroup and Deutsche Bank, according to his page. [...] Obviously, if you've been following the Deutsche Bank saga as I've outlined it on this website and as other researchers have been following it, you'll know that that bank is up to its earlobes in financial practices of a "dubious" nature. Then, of course, there is Deutsche Bank's strange appearance in the events of 9/11 via one of its offshoots placing trades that would tend to indicate prior knowledge of the event (not surprising, given it's connections to the (out) House of Saud as I outlined in my book Hidden Finance, Rogue Networks, and Secret Sorcery). And Mr. Bell is not the only banker with a connection to the big German bank who has turned up dead by suicide. Additionally, Mr. Bell fits another pattern embedded within some of the banker deaths, namely, he was involved in credit risk assessment.[...]"

Commentary: "Keiser Report: Cognitive Dissonance in US Stock Markets (E1040)" [03/05/17] [25:45] "We discuss cognitive dissonance in US stock markets. In the second half, Max continues his interview with economic researcher, writer and trend forecaster, Chris Martenson of PeakProsperity.com about ‘the mother of all bubbles’ in US equity markets.  [...]"  

Commentary: "NY Teamsters Pension Runs Out Of Money: "Pension Tsunami" Is Coming" [03/03/17] Printer Friendly Version "The New York Teamsters Road Carriers Local 707 Pension Fund has won the unfortunate award for “First Pension to Officially Run Out of Money.” According to the New York Daily News, and a host of angry former truck drivers who’ve had their pension benefits slashed, the Pension Benefit Guaranty Corp. (PBGC) has officially been forced to step in and take over payments to retirees of the Local 707, albeit at a much lower rate. Teamsters Local 707’s pension fund is the first to officially bottom out financially — which happened this month. “I had a union job for 30 years,” Chmil said. “We had collectively bargained contracts that promised us a pension. I paid into it with every paycheck. Everyone told us, ‘Don’t worry, you have a union job, your pension is guaranteed.’ Well, so much for that.” [...] “It’s a nightmare, it has just devastated all of our lives. I’ve gone from having $48,000 a year to less than half that,” said Chmil, one of five Local 707 retirees who agreed to share their stories with the Daily News last week.[...] Of course, the Teamsters 707 and other Teamster pension boards attempted to submit plans that would have cut benefits in order to prolong payments to retirees but those plans were universally rejected by the Obama administration…better the pensions just run out of cash completely.[...]" Related: "Federal Insurance Agency Backing Union Pensions Facing Crisis Itself" Printer Friendly Version 

Commentary: "$4.6bn Long-Term-Care Insurer To Liquidate In Pa; Biggest Healthcare Failure Ever" [03/03/17] Printer Friendly Version "We spend a lot of time talking about the various pension ponzi schemes that will inevitably wreak havoc on the global financial system at some point in the not so distant future. That said, you should also be keeping an eye on so-called long-term-care (LTC) health insurance providers who, as Penn Treaty Network of America Insurance teaches us this morning, have been perpetuating a ponzi scheme of their own. After eight full years of legal battles between state regulators, investors, and policyholders, Pennsylvania Court Judge Hannah Leavitt signed off on a plan Wednesday to liquidate Penn Treaty Network America Insurance and its affiliate, American Network Insurance, the largest such health insurance liquidation in history. The decision leaves solvent insurers, their owners, and customers to pick up the cost for more than 70% of the up to $4.6 billion in projected long-term-care claims expected for 76,000 aging Penn Treaty customers nationwide. Pennsylvania Insurance Commissioners Teresa Miller said that after a grueling eight-year legal battle the companies' financial difficulties were deemed "too great to be remedied." Per the PA Insurance Department: Insurance Commissioner Teresa Miller today announced the Commonwealth Court approval of petitions to liquidate Penn Treaty Network America Insurance Company and American Network Insurance Company, with policyholder claims to be paid through the state guaranty association system, subject to statutory limits and conditions. "After a long and difficult eight-year legal process, the Court's decision to approve the liquidation recognizes the companies' financial difficulties are too great to be remedied, and that consumers are best protected through the state guaranty association system," Commissioner Miller said. [...]" Related: "Keiser Report: Financial Toxicity In The US" [25:46] 

MSM: "Venezuela Is Down To Its Last $10B As Debt Payments Loom" [03/03/17] Printer Friendly Version "Venezuela’s central bank is down to its last $10.5 billion in foreign reserves, according to the institution’s most recent report on the country’s financials. [...] Over the remainder of 2017, Caracas needs to fund $7.2 billion in debt payments – an amount that it can only meet if oil prices spike far higher than the ongoing boosts caused by OPEC’s output reduction agreement. Current reserves stand 66 percent lower than levels in 2011, when the government held $30 billion in foreign currencies to spend on loan repayments and other official business (and down 75% from 2008 highs). "The question is: Where is the floor?" Siobhan Morden, head of Latin America fixed income strategy at Nomura Holdings, told CNN Money. "If oil prices stagnate and foreign reserves reach zero, then the clock is going to start on a default."  Venezuela’s financial report for 2016 stated that roughly $7.7 billion of the remaining $10.5 billion in foreign reserves had been preserved in gold. Last year, in order to fulfill debt obligations, Caracas began shipping gold to Switzerland. The drastic fall in oil prices in 2014 and widespread corruption have both caused an economic meltdown in the South American country, where citizens had become accustomed to imported goods paid for by fossil fuel revenues. President Nicolas Maduro has resorted to opening the country’s border with Columbia to allow Venezuelans to purchase necessary medical and day-to-day supplies.[...]" 

Commentary: "Real Personal Spending Crashes Most Since 2009" [03/02/17] Printer Friendly Version "With incomes rising more than spending, the savings rate predictably ticked up from multi year lows, rising from 5.4% to 5.5% in January. On the income side, the increase in personal income was almost entirely from service-producing industries wages, which increased by $22.5BN, while Goods-producing was higher by just $4 billion. Additionally, Social Security transfer benefits added another $9 billion. However, for the 'average joe', facing a rising cost of goods, real personal spending plunged 0.3% in January: the biggest drop since September 2009. Finally, as a result of surging inflation, and disposable incomes suddenly unable to keep up, the real annual growth in disposable income per capita fell to just 1.5%, the weakest in over 3 years and a red flag for those calling for another renaissance for US consumers.[...]" 

Commentary: "Wall Street Scrambles To Change The Trump Narrative Again" [03/02/17] Printer Friendly Version " "Until yesterday, the prevailing Wall Street consensus was that in the absence of specifics from President Trump on his economic and fiscal plans, the market would be disappointed, and proceed to slide. It did not, in fact quite the opposite. As a result, the world's best paid strategists have again - just like after the election - revised the "Trump narrative" after the fact, and now the prevailing analyst sentiment is that markets will like Trump’s address to Congress as he cooled his rhetoric and likely gained political capital. As Bloomberg adds, the reflation trade, which has been boosting financials, held, even as the speech was short on details, forcing the U-turn in the plotline. Still, while turning tactically bullish overnight, there is an agreement that efforts on tax reform and infrastructure spending are likely a long, uphill slog, as those priorities may get squeezed by other agenda items, like health care. Here is a recap of some of the most prominent notes flying around this morning, virtually none of which to Mark Cudmore chagrin, suggest - if only for now - that the "emperor is naked." [...]"   

MSM: "SEC Freezes Accounts Of "Highly Suspicious" Traders Who Made $3.6 Million On Takeover" [03/02/17] Printer Friendly Version "First, it was the leak of the massive Heinz-Unilever deal that may have scuttled the Warren Buffett-inspired transaction, now it appears that another recent megamerger was leaked 4 days ahead of the announcement. On Wednesday morning, the SEC froze brokerage accounts of several unnamed traders who made more than $3.6 million in profits by trading in the four days before the $3.3 billion takeover of Fortress Investment Group was announced by Japan’s SoftBank. According to the FT, the traders placed “highly suspicious” orders for shares and contracts for difference, or CFDs, through Singapore-based Maybank Securities and a brokerage in London, R.J. O’Brien. Breaking the second cardinal rule of insider trading, i.e., never to buy stocks in bulk in the day ahead of the announcement (the first such rule is never to buy calls the before a deal is announced although the "insiders" did that too), all the trades through Maybank were made within a 24-hour period before the deal to buy the US-listed private equity firm was announced to the market; meanwhile trade through R.J. O’Brien took place between February 10 and 14, the day the deal was disclosed the SEC reported. “The timing, size and profitability of these trades are highly suspicious,” the SEC said in a court filing asking for the freeze. As the FT adds, the SEC is seeking a judgment to force the traders to disgorge the profits and pay a penalty. SoftBank’s offer for Fortress was a 30 per cent premium over the private equity firm’s closing share price that day. Also, as the SEC further notes, it appears that the rookie traders decided to really bring attention on themselves by also breaking Cardinal rule #1: a burst of option buying ahead of the deal. Just like in the case of the Unilever deal, which saw a surge in call option volume for both Unilever and Kraft Heinz ahead of the announcement... [...]  ... the size of bets in the options market prior to the deal raised eyebrows in the US, leading several market experts to believe that information had been leaked ahead of the deal. The volume of options trading in Fortress was more than eight times the normal level ahead of the deal’s public announcement. Specifically, customers of Maybank bought 950,000 shares in Fortress hours before the announcement, selling them the next morning for $1.7 million. R.J. O’Brien’s customers bought CFDs and shares in Fortress, which they sold on February 15 for $1.9 million, according to the SEC’s complaint seeking the freeze.  Also notable is how quickly the leak appears to have emerged: the Maybank clients began placing the trades on February 14, building up a $5 million position, 33 minutes after Fortress’s board of directors received an email with draft resolutions approving the deal, according to the SEC. Only two days before, there was “serious doubt” as to whether the deal would even go through, the SEC complaint said. Discussions between SoftBank and Fortress had begun in December, and the two companies initially planned to finalise the deal over the weekend of February 10-12, putting it to a board vote at Fortress on February 12. The R.J. O’Brien clients began buying CFDs on February 10, through an account with Merrill Lynch, just before that weekend. The only other time Maybank bought any Fortress stock through its account at UBS was in February 2016, when 10,000 shares were bought and later sold in April. As the FT notes, the emergency court order obtained by the SEC on February 24 will prevent the traders from accessing any of those gains. As yet, the SEC said they do not know the identities of the traders, but said in the complaint they are “believed to be foreign traders trading through foreign accounts”. In recent years, suspicious trading before deals has been under increased scrutiny by the SEC and regulators around the world after insider trading prosecutions in New York over the past decade exposed the extent of the crime. The SEC has yet to launch a probe into the far larger Unilever leak(s).[...]"  

Commentary: "March 2017: The End Of A 100 Year Global Debt Super Cycle Is Way Overdue" [03/01/17] Printer Friendly Version "For more than 100 years global debt levels have been rising, and now we are potentially facing the greatest debt crisis in all of human history. Never before have we seen such a level of debt saturation all over the planet, and pretty much everyone understands that this is going to end very, very badly at some point. The only real question is when it will happen. Many believe that the current global debt super cycle began when the Federal Reserve was established in 1913. Central banks are designed to create debt, and since 1913 the U.S. national debt has gotten more than 6800 times larger. But of course it is not just the United States that is in this sort of predicament. At this point more than 99 percent of the population of the entire planet lives in a nation that has a debt-creating central bank, and as a result the whole world is drowning in debt. [...] That is the inevitable consequence of 100 years of credit expansion from virtually nothing to $250 trillion, plus global unfunded liabilities of roughly $500 trillion, plus derivatives of $1.5 quadrillion. This is a staggering total of $2.25 quadrillion. Therefore, the question is not what could go wrong since it is guaranteed that all these liabilities will implode at some point. And when they do, it will bring misery to the world of a magnitude that no one could ever imagine. It is of course very difficult to forecast the end of a major cycle. As this is unlikely to be a mere 100-year cycle but possibly a 2000-year cycle.[...]"  Note:  If everyone agreed to dispense with or reset the entire debt and begin again from a different perspective, that would be all it would take. But no, they're all addicted to the system, as is, and bound up with existential angst. In all probability, they will do all they can do to keep it going.

Commentary: "David Stockman: Two Potentially Big Events Coming March 15, 2017" [02/28/17] Printer Friendly Version "Video" [26:30] "In an interview yesterday with Greg Hunter’s USA Watchdog, David Stockman made a dire forecast for financial markets for the summer of 2017, as shown in the 26-minute video. Mr. Stockman served as a Republican U.S. Representative from the state of Michigan and as the Director of the Office of Management and Budget under President Ronald Reagan. He is expecting two key events on March 15 2017 are going to set in motion a major drop in financial markets by this summer. He estimated, “I expect the markets will easily correct by 20% and probably a lot more.” [...] 1. Debt Ceiling Crisis: First, the debt ceiling holiday which started in October 2015 expires, which will lock in the U.S. government’s debt at a limit of $20 trillion. By law, Congress will not be able to borrow any additional funds to cover spending. They will be limited to the monthly tax revenues, which is about $250 to $300 billion, but not enough to cover current spending levels. Mr. Stockman estimates the Treasury Department will run out of cash by this summer, which will cause what he calls “the mother of all debt ceiling crises.”  He expects when Wall Street realizes Congress is unable to cover their current spending commitments, it will shock investors and cause a sell-off. Although Congress has raised the debt ceiling over 70 times in the past, Mr. Stockman believes they won’t be able to raise it this time because the current deal gives the President authority to allocate spending in the event that no new spending agreement is reached. That gives President Trump bargaining power his predecessors have not had, which increases the likelihood of a government shutdown. He further predicts the debt ceiling crisis will derail President Trump’s plans to repeal Obamacare, cut taxes, and provide an infrastructure stimulus. He expects that will negatively impact financial markets, causing the current bullish optimism to “dissipate very quickly.”[...]  Stockman: “I think what people are missing is this date, March 15th, 2017. That’s the day that this debt ceiling holiday that Obama and Boehner put together right before the last election in October of 2015. That holiday expires. The debt ceiling will freeze in at $20 trillion. It will then be law. It will be a hard stop. The Treasury will have roughly $200 billion in cash. We are burning cash at a $75 billion a month rate. By summer, they will be out of cash. Then we will be in the mother of all debt ceiling crises. Everything will grind to a halt. I think we will have a government shutdown. There will not be Obama Care repeal and replace. There will be no tax cut. There will be no infrastructure stimulus. There will be just one giant fiscal bloodbath over a debt ceiling that has to be increased and no one wants to vote for.” [...] 2. Fed Raising Interest Rates: Second, Mr. Stockman says, “They are going to raise interest rates on March 15. They have to. I’m talking about the Fed.” If the Fed raises rates on March 15, it would cause the dollar value to go up, which fits what I have been expecting to see, the dollar getting stronger until it suddenly gets devalued. Raising rates could also be the catalyst for a drop in precious metals prices, which fits the two steep legs down, which I shared in my previous post. I am expecting to see spot silver prices drop by over $4.00 per ounce from the current market price of $18.38. Mr. Stockman added, “The S&P 500 has been trading at 26 times earnings while earnings have been dropping for the past six or seven quarters. There is no booming recovery coming. There is going to be a recession and there will be no stimulus baton to bail it out. That is the new fact that neither Trump nor the Wall Street gamblers remotely understand.” Later in the interview, he added, “I think we are going to have a greater depression in the stock market than we have had since 1987 when it dropped 25% in one day.”[...] The S&P 500 has been trading at 26 times earnings while earnings have been dropping for the past six or seven quarters. There is no booming recovery coming. There is going to be a recession and there will be no stimulus baton to bail it out. That is the new fact that neither Trump nor the Wall Street gamblers remotely understand.”[...]" 

Commentary: "EU Threat To Pensions: Mass Migration Blamed For £30 Billion A Year 'Economic Catastrophe'" [02/26/17] Printer Friendly Version "The comprehensive paper - How the £30 billion cost of EU migration Imperils Pensions & Benefits - by the thinktank Global Britain has blown apart claims that the UK needs EU migration to support its pension system. Instead it reveals that cheap labour flooding in from the continent is causing "an economic catastrophe" for the UK which threatens the pension system. [...] And the report suggests that leaving the EU and taking back control of British borders will provide the UK with “a £250 billion opportunity” in the next five years. The new study comes in a week where new figures revealed that the annual net migration is still 273,000, a reduction of 49,000 from previous figures but almost three times the level the government promised to reduce the number to. The latest Office of National Statistics (ONS) figures revealed that 268,000 EU citizens relocated to the UK in the year up to September 2016 with 74,000 of the incomers arriving from Romania and Bulgaria. The latest figures have highlighted the continued strain to the Exchequer of low paid workers coming into the UK.[...] The Global Britain report's author Bob Lyddon, a leading City analyst, points out that the annual net cost of Britain’s 3 million EU migrants is £31.5 billion based on official figures which show that the Government spends £10,500 per head. However, he shows that only 2 million of them work contributing a mere £500 each in tax in average, a total of just £1 billion a year. This includes negligible levels of National Insurance contributions which underpin the state pension. He argues that the EU freedom of establishment rule combined with freedom of movement means “tax efficient” multinationals can flood the UK with cheap foreign labour but avoid paying money to the Treasury such as corporation tax. In a damning indictment he says that the UK taxpayer is subsidising low paid jobs for foreign workers.[...]" 

Concepts and Practices: "The Problem With Gold-Backed Currencies" [02/23/17] Printer Friendly Version "There is something intuitively appealing about the idea of a gold-backed currency --money backed by the tangible value of gold, i.e. "the gold standard." Instead of intrinsically worthless paper money (fiat currency), gold-backed money would have real, enduring value--it would be "hard currency", i.e. sound money, because it would be convertible to gold itself. Many proponents of sound money identify President Nixon's ending of the U.S. dollar's gold standard in 1971 as the cause of the nation's financial decline. If our currency was still convertible to gold, the thinking goes, the system would never have allowed the vast pile of debt to accumulate. The problem with this line of thinking is that it is disconnected from the real-world mechanisms of capital flows and the way money is created in our financial system. This article explains why Nixon took the USD off the gold standard: since the U.S. was running trade deficits, all of America's gold would have been transferred to the exporting nations. America's gold reserves would have disappeared, leaving nothing to back the dollar. The U.S. Empire Would Have Collapsed Decades Ago If It Didn’t Abandon The Gold Standard. The problem to sound-money proponents is trade deficits: if the U.S. only had trade surpluses, then the gold would not drain away. But Triffin's Paradox explains why this doesn't work for a reserve currency: a reserve currency has two distinct sets of users: domestic users and global users. Each has different needs, so there is a built-in conflict between the two sets of users. [...] Global users of the USD need enormous quantities of dollars to use as reserves, to pay debts denominated in USD and to facilitate international trade. The only way the issuing nation can provide enough currency to meet this global demand is to run large, permanent trade deficits--in effect, "exporting" dollars in exchange for goods and services. This is the paradox: to maintain the "exorbitant privilege" of a reserve currency, a nation must "export" its currency in size; a nation that runs trade surpluses cannot supply the world with enough of its currency to act as a reserve currency. And any nation running large trade deficits will soon empty its gold reserves as international holders of the currency choose to convert their currency into gold, which is exactly what happened in the late 1960s in the U.S. OK, so a nation can't back a reserve currency with gold. How about backing a non-reserve currency with gold? There are still problems with backing currencies with gold. Number 1 is convertibility--without it, you don't have a gold standard, you have an illusion of a gold standard. If the gold-backed currency isn't convertible to gold, it's simply another form of fiat currency.[...]" 

Commentary: "How Many Euro Crises Will This Make? It's Getting Hard To Keep Track" [02/22/17] Printer Friendly Version "Every few years, it seems, one or another mismanaged eurozone country falls into one or another kind of crisis. This leads to speculation about the end of the common currency, which in turn spooks the global financial markets. Then the ECB conjures another trillion euros out of thin air, buys up and/or guarantees all the offending country’s bonds, and calm returns for a while. At least, that’s how it’s gone in the past. The latest crisis has more than the usual number of flash-points and could, therefore, be something new and different. Currently: Greece. This charming but apparently ungovernable country only got into the eurozone in the first place because its corrupt leaders conspired with Goldman Sachs to hide the true condition of the government’s finances. It quickly blew up and has been on intensive care ever since. Now the latest bailout has become deal-breakingly messy: [...] Italy. A few months ago the centrist president, Matteo Renzi, resigned after losing a referendum (don’t bother with the details, they were never very interesting and in any event have been overtaken by events), making a new election necessary. There was a chance that Renzi would be returned to office, which would reset the clock on Italy’s inevitable descent into Greek-style chaos. But yesterday he resigned, throwing the upcoming elections into disarray and opening the door to eurosceptic populists. Combine political turmoil with a moribund banking system and Italy becomes a prime candidate for Big European Crisis of 2017. [...] France. Each new immigration horror story adds a bit to the popularity of the anti-immigration National Front, and increases the odds that party leader Marine Le Pen makes a strong showing in upcoming elections. The odds are still against her actually winning, but as the polls tighten, French bonds are sold off by nervous traders, widening the spread between French and German yields. A widening yield is a sign of approaching trouble: [...]  And those are just the front-burner problems. The Dutch are also holding general elections next month in which their version of Donald Trump will likely be the leading vote-getter. Germany has two elections this year, and opposition parties are gaining on Chancellor Angela Merkel. So there will be no shortage of scary headlines from the Continent going forward. Why should non-Europeans care about any of this? Because the EU is the biggest economic entity on the planet and the euro is the second most widely-held currency. Turmoil there means turmoil everywhere else, though the form is hard to predict. A euro crisis might send terrified capital into US stocks and bonds, extending the bull market in domestic financial assets – and making the current US administration look like a bunch of geniuses. Or it could spook capital out of financial assets altogether, crashing stocks and bonds while boosting the price of real things like farmland, solar farms and precious metals. Or it could buoy all US assets, with “anywhere but Europe” becoming the dominant investment theme for a while. OR the ECB could try to paper over the mess by devaluing the euro even further, setting off a trade war with the US, Japan and China, all of whom need weaker not stronger currencies to hide their own financial mismanagement. ...]" 

Commentary "Buffet Just Drove A Stake Through The Heart Of Wal-Mart" NNN [02/19/17] [6:27] "Investor Warren Buffett has sold off 89 percent of his shares of Walmart as the giant retailer fights Amazon for a share of the e-commerce market. Buffett’s Berkshire Hathaway announced Tuesday that it had sold off $900 million of Walmart stock as it invested elsewhere. [...]"  

MSM: "George Soros Bought A Huge Stake In Goldman Sachs After Trump’s Election" [02/17/17] Printer Friendly Version "George Soros’ hedge fund Soros Fund Management made big changes to its portfolio in the fourth quarter of 2016, including a $14.9 million stake into Goldman Sachs. Goldman Sachs and other financial companies enjoyed large amounts of investment after Donald Trump's victory in the presidential election. Trump's promises of deregulation and tax cuts made the financial sector a safe bet for investors. Soros, who has spent hundreds of millions of his own money for liberal causes and is a vocal critic of President Trump, saw his stock portfolio briefly devalued by $1 billion after the election.[...] In addition to Goldman Sachs, Soros bought tens of millions of shares in companies such as Facebook, Time Warner, T Mobile, and Kohls. Soros also totally eliminated his stake in Barrick Gold as the gold market contracted in late 2016. Other companies that he sold major shares from include Intel, Wisdomtree, and Procter & Gamble. Steven Mnuchin, former Executive Vice President of Goldman Sachs, was confirmed to the Senate as President Trump's Treasury Secretary on Tuesday. Mnuchin also was a member of an investment group alongside Soros in the mid-2000's.[...]"  Note: That Soros can subvert the Trump administration (subverting societies worldwide who are now on non-Globalist bents, in an effort to 'restore' the globalism dynamic) and at the same time profit from that which the administration creates (by virtue of regulatory alteration, elimination, other preferred systemic legislation, etc) is opportunistic, the fact that Soros takes these measures after the election, alludes to the notion that the result of the election, and indeed the entire global 'awakening' of individualism and nationalism (in the sense that every country is unique and has its own borders and laws), was totally unexpected, which ultimately means that [1] from Soros perspective, government is more or less moot except for the effect it has on the value of an already-existing globalist financial system .... that non-government corporations which are already operating in a global network 'trumps' all government corporations anyway. [2] They are now aware that any control they thought they had over the large-scale unfolding of events on the planet has been lost, evoking intense existential angst loops in these body-bound reincarnates ... the local endgame continues.

Commentary: "Germany Accelerates Gold Repatriation As Confidence In Euro Plunges" [02/13/17] Printer Friendly Version "Berlin is bringing home its gold reserves stored in New York, London and Paris faster than scheduled, Germany’s central bank said Thursday. The move is linked to surging euroskepticism, as new governments in France and Italy may ditch the single currency. The German Bundesbank has already moved 583 tons of gold out of New York and Paris, planning to have a half of its gold back in Germany by the end of 2017, which is ahead of the 2020 plan. The rest will be split between the Federal Reserve Bank of New York and the Bank of England. As French presidential candidate Marine Le Pen and Italy’s 5-Star Movement are openly calling to pull out of the euro, some economists in Germany say the repatriated gold may be needed to back a new deutschmark should the eurozone collapse.[...] During the Cold War, 98 percent of Germany’s bullion was stored abroad, and so far the biggest repatriation was in 2000 when the Bundesbank repatriated 931 tons from the Bank of England. When the relocation is complete, Germany will still have 1,236 tons in New York, 432 tons in London and the rest in Frankfurt. The current repatriation involves moving 300 tons from New York and 374 tons from Paris. The Bundesbank said it is not worried about keeping gold in England despite Brexit, as London remains a key gold trading market and a safe place. Germany has the second-largest gold reserves in the world after the US with 3,381 tons.[...]" 

Commentary: "Trump Concerned There Are Too Many "Goldman Guys" On His Team" [02/13/17] Printer Friendly Version Two days after democratic senators Elizabeth Warren and Tammy Baldwin sent a letter to Goldman CEO Lloyd Blankfein, asking if Goldman effectively runs the country through its extensive alumni links at the Trump administration, and requesting details on "lobbying" activities in the bank related to review of the Dodd-Frank Act and the Obama-era fiduciary rule on financial advice, as well as asking for any communication between the bank's employees and Cohn, Mnuchin, nominee for the SEC chair Jay Clayton and chief strategist Steve Bannon, Bloomberg reported overnight that yet another Goldman banker, Jim Donovan, was under consideration for the No. 2 job at the Treasury Department, however it appears he has "got one big thing working against him."  That "thing" is the overdue realization by the new president that his cabinet openly appears to have been created and staffed by populism arch nemesis #1, Goldman Sachs. Besides Steven Mnuchin, Trump’s pick for Treasury Secretary, former Goldman officials working for the new administration include former president Gary Cohn, now director of the National Economic Council; Stephen Bannon, the chief White House strategist; and Dina Powell, formerly the bank’s head of philanthropic investment, who’s an assistant to the president and senior counselor for economic initiatives.  So just like Goldman would staff every central bank's core positions prior to Trump, after the US election, the world's most influential investment bank has shifted all of its attention on just one person, and he is finally starting to realize that that may not be a good thing." [...]  Too many “Goldman guys” already have high-up positions in the Trump administration, the person said, and that could knock Donovan down to one of the undersecretary positions -- possibly undersecretary of the Treasury for domestic finance. The presence of several former Goldman officials at the highest reaches of the administration runs counter to the president’s regular attacks on Wall Street firms during the campaign. “Donald Trump’s Argument for America,” a two-minute advertisement that ran in prime-time days before the election, featured Goldman Chief Executive Officer Lloyd Blankfein in an segment about corporate chieftains pocketing the wealth of American workers.[...]" 

MSM: "Killing Dodd-Frank & Fiduciary Rule Won't Be Easy, Wall Street Cautious" [02/09/17] Printer Friendly Version "Dodd-Frank and its byproducts including the Volcker Rule, bank stress tests, the CFPB and the fiduciary rule, though not perfect, have had a single goal: protect investors and the economy from another destabilizing financial crisis. Those looking to dismantle the rules also have a single goal: putting the interests of the banks and other financial companies ahead of everything and everyone else. But just as its creation and implementation was long and complex so will Dodd-Frank’s possible repeal. A UBS report today noted that while the executive orders about regulation carry “symbolic significance” the legislative process presents some clear constraints. More specifically, “proposals to change components of Dodd-Frank require Senate approval, where 60 votes are needed (and, hence, support from Democrats).” As for the fiduciary rule, the one that requires brokers to put their clients’ interest before their own, that’s going to take some time as well. The delay seems certain but beyond that, UBS says, is more difficult to tell: The acting Secretary of Labor is already working to delay the fiduciary rule. However, without a confirmed Labor Secretary, the outlook for the rule beyond that is unclear. Andrew Puzder's appointment has been drawn out and seems likely to be a challenging confirmation process. Importantly, the Fiduciary rule is currently being challenged in a N. Texas Court case, which may also impact the fate of the rule. More interestingly and importantly, it seems most big banks with brokerage arms are ready to comply with the fiduciary rule as planned. [...] Merrill Lynch seems to be embracing the fiduciary rule with enthusiasm. Here's the official word from Merrill's website : "In 2016, the Department of Labor released a new rule that holds all financial advisors to a fiduciary standard when providing investment advice to clients regarding their retirement accounts. That advice must be in a client's best interest and cannot be compromised by any advisor’s financial interest. This is good news, and we support this new rule wholeheartedly."[...]"  

Commentary: "Chinese Reserves Unexpectedly Drop Below $3 Trillion For The First Time Since 2011" [02/08/17] Printer Friendly Version "... While the $3 trillion mark is not seen as a firm "line in the sand" for Beijing, concerns are swirling over the speed at which the country is depleting its reserves and how much longer it can afford to defend the currency. Some analysts estimate China needs to retain a minimum of $2.6 trillion to $2.8 trillion under the International Monetary Fund's (IMF's) adequacy measures, and fears of a devaluation would likely intensify capital flight. The drop in January's reserves could have been worse if not for a sudden reversal in the surging U.S. dollar in January, some analysts said. The softer dollar boosted the value of non-dollar currencies that Beijing holds. The yuan has gained nearly 1 percent against the dollar so far this year. But analysts expect downward pressure on the yuan to resume, especially if the U.S. continues to raise interest rates, which would likely trigger fresh capital outflows from emerging economies such as China and test its enhanced capital controls. [...]"    Related: "Chinese Economic Bubble" Printer Friendly Version 

Concepts and Practices: "U.N. Official: Global Warming Agenda Really About Destroying Capitalism" [02/08/17] Printer Friendly Version "Economic Systems: The alarmists keep telling us their concern about global warming is all about man's stewardship of the environment. But we know that's not true. A United Nations official has now confirmed this. At a news conference last week in Brussels, Christiana Figueres, executive secretary of U.N.'s Framework Convention on Climate Change, admitted that the goal of environmental activists is not to save the world from ecological calamity but to destroy capitalism. "This is the first time in the history of mankind that we are setting ourselves the task of intentionally, within a defined period of time, to change the economic development model that has been reigning for at least 150 years, since the Industrial Revolution," she said. Referring to a new international treaty environmentalists hope will be adopted at the Paris climate change conference later this year, she added: "This is probably the most difficult task we have ever given ourselves, which is to intentionally transform the economic development model for the first time in human history." The only economic model in the last 150 years that has ever worked at all is capitalism. The evidence is prima facie: From a feudal order that lasted a thousand years, produced zero growth and kept workdays long and lifespans short, the countries that have embraced free-market capitalism have enjoyed a system in which output has increased 70-fold, work days have been halved and lifespans doubled. Figueres is perhaps the perfect person for the job of transforming "the economic development model" because she's really never seen it work. "If you look at Ms. Figueres' Wikipedia page," notes Cato economist Dan Mitchell: Making the world look at their right hand while they choke developed economies with their left.[...]" [Cross-Posted]

Resource: "Public Pension Tsunami" [02/07/17] Updated Story List: Printer Friendly Version "The oncoming wave of public pension debt is even bigger than it seems. The purpose of this website is to provide an overview of the multiple pension crises that are about to drown America's taxpayers. Our primary focus is on California, but we also track other states, corporate pensions, social security and international trends. Now half-way through its 12th year, Pension Tsunami was founded by and is edited by Jack Dean. [...]" 

MSM: "Honeymoon Is Over: Goldman Slams Trump's Economic Plan, No Longer Expects A Border Tax" [02/05/17] Printer Friendly Version "As the Goldman team writes, following the election, there was a burst in euphoria and "the positive shift in sentiment among investors, business, and consumers suggested that the probability of tax cuts and easier regulation was seen to be higher than the probability of meaningful restrictions to trade and immigration", however three months later "the risks are less positively tilted than they appeared shortly after the election." [...] If Goldman is right, expect little if any Trump policies to be implemented until mid to late 2018, and not only the various near-all time high "soft" economic indicators like consumer and business confidence to roll over steeply in the coming weeks as optimism fades, but more importantly, hard data to plunge, dragging the USD, yields and stocks along with it. [...]" 

Financial Predation: "Trump Signs Executive Orders Rolling Back Dodd-Frank, Fiduciary Rule" [02/04/17] Printer Friendly Version "As previewed earlier today, President Trump signed two executive orders aimed at starting the process of rolling back the regulatory system put in place after the financial crisis.  Among the targets are rules that protect against predatory lenders, force brokers to lower fees for retirees and ban proprietary trading. Specifically, Trump took executive action ordering the review of Dodd-Frank rules enacted after 2008 financial crisis, and halting the "fiduciary rule" that would require advisers on retirement accounts to work in the best interests of their clients. [...] While it will take a while to fully roll back the financial regulations, we are confident that Wall Street is already preparing for the next big push into prop trading, major releveraging, blowing a whole new set of asset bubbles, and all those other things which brought the system to a near collapse less than 10 years ago. Finally, while Trump was quick to begin the process of undoing Dodd Frank - no doubt with the helpful advice of numerous former Goldman bankers standing behind his shoulder - he has yet to make any comments on bringing back Glass Steagall, the one law that would truly protect depositors from runaway banker greed, and mandate yet another taxpayer funded bailout the next time the US banking sector is in need of a bailout.[...]"  Note: Wow, they bamboozled Trump on this one. Unfortunate executive orders by Trump, because it puts peoples retirement at risk. That would not seem to 'make America great'. Related: "Trump to Sign Orders Today Making Wall Street More Dangerous" Printer Friendly Version

Commentary: "Don’t Blame Trump When Faulty Financial Theory Means Things Go South" [02/04/17] Printer Friendly Version "There was, indeed, a time when clear thinking and lucid communication via the written word were held in high regard. As far as we can tell, this wonderful epoch concluded in 1936. Everything since has been tortured with varying degrees of gobbledygook. The fall from grace was triggered by the 1936 publication of John Maynard Keynes’ The General Theory of Employment, Interest and Money. The book is rigorously indecipherable. What’s more, it has the ill-effect of making those who read it dumber. Nonetheless, politicians and establishment economists remain enamored with Keynes’ gibberish. For it offers academic rationale for governments to do what they love to do most – borrow money and spend it on inane programs. In particular, Keynes advocated filling bottles with money and burying them in coalmines for people to dig up as a way to end unemployment. Somehow, this public works egg hunt would make everyone rich. Over the years this reasoning has inspired countless government stunts to save the economy from itself. Not long ago, Keynes devotee, Paul Krugman, took this logic and ran with it to the outer limits of deep space. In the process, he seems to have lost his mind. According to Krugman, the proper way to propel an economic growth chart up and to the right is to borrow massive amounts of money and spend it preparing for an alien invasion. Naturally, it takes a Nobel Prize winning economist to come up with such nonsense. [...] Unfortunately, Keynes’ drivel became the archetypical for illogical economic thought, and still infects economic discourse to this day. You can hardly browse the headlines of Yahoo finance without your eyeballs being lacerated by it. Just this week, for instance, we came across a headline titled, The Coming Trump Financial Crash. The author, Dennis M. Kelleher, happens to be President and CEO of the oddly named company Better Markets. The company website clarifies that Better Markets is “a nonprofit that promotes the public interest in the financial markets.” What exactly this Washington, D.C. based nonprofit does – or how they keep the lights on – is unclear. But what is clear is that Kelleher is very comfortable applying words and terms to construct sentences with haphazard syntax. Kelleher also seems panicked that financial deregulation by Trump is going to cause a great big crash:[...] Here at the Economic Prism we think Kelleher is giving President Trump too much credit for what he can and can’t do. While we agree a stock market crash is in the cards. Unlike Kelleher, when the crash does inevitably come, we don’t think President Trump is who the fingers of blame should be pointed at. Regulations, which Kelleher advocates, don’t get at the core of the problem. Rather, the core of the problem is that today’s fiat money system is completely out of control. Until something is done about it, we’ll continue to experience epic asset bubbles and busts. President Trump’s efforts to ease corporate tax policy or financial regulations are small potatoes compared to the destructive market whipsaws that come with rampant credit creation. Offshore corporate coffers would’ve never been stuffed so full if we had sound money with honest limits. You may love the man. You may hate him. But the fact is, President Trump has been dealt the worst hand of any incoming U.S. President since James Buchanan – or maybe ever.[...] The point is a century of scientific mismanagement of the currency has pushed the economic, financial, and social order well past any rational limit. Total government debt and stock valuations are at all-time extremes. Something big is coming. You can guarantee it.[...]" 

Commentary: "Three Senators Call To Reinstate Key Protections To Rein In Wall Street" [02/03/17] Printer Friendly Version "Kaptur leads 26 cosponsors in reintroduction of Return to Prudent Banking Act [...]At a press conference today, Rep. Marcy Kaptur (OH-09) was joined by Reps. Walter Jones (NC-03), Tim Ryan (OH-13) and Tulsi Gabbard (HI-02) to introduce the Return to Prudent Banking Act and urge President Donald Trump to live up to his campaign promises on reinstating Glass-Steagall protections in our banking system. The bill is bipartisan with 26 cosponsors and is endorsed by Public Citizen and the AFL-CIO. “The 2008 crash nearly took down our entire economy and led to the great recession which wiped out average Americans’ income. But now, Democrats and Republicans have memorialized support for Glass-Steagall in their respective political platforms. Even President Trump has declared his support for a new Glass-Steagall law,” said Congresswoman Marcy Kaptur. “That is why we are here, to build on the momentum and the movement to reinstate Glass-Stegall.” “Wall Street banks should not be allowed to use taxpayer-insured consumer deposits to gamble in the markets and then get taxpayer bailouts for failed decisions,” said Congressman Walter B. Jones. “It’s time to put American taxpayers and depositors first. It’s time to pass the Return to Prudent Banking Act and reinstate Glass-Steagall.” “I am proud to cosponsor the Return to Prudent Banking Act, which revives the separation between commercial banking and securities companies as written in the Glass-Steagall Act. These are smart financial reforms designed to protect our economy from another financial crisis and hardworking American taxpayers from another Wall Street collapse. We know that the climate of deregulation led to the financial crisis. We can’t let that happen again,” said Congressman Tim Ryan. “From the Great Depression through the turn of the 21st Century, Glass-Steagall helped keep our economy safe. Repealing it allowed too-big-to-fail banks to gamble with the savings and livelihoods of the American people, with devastating, irrevocable consequences. Hawaii, along with communities across the country, paid the price in 2008 with the worst financial crisis since the Great Depression. Today, the banks that were ‘too big to fail’ in 2008 are even bigger and more powerful now. We must reinstate Glass-Steagall and create a financial system that works for every American—not just Wall Street banks,” said Congresswoman Tulsi Gabbard. [...]"  

Commentary: "Trump Set To Rollback Financial Regulation Passed After The 2008 Crisis" Real News [02/02/17] [6:47] "By refusing to challenge Clinton and Bush-era deregulation and also explain the causes of the financial crisis to the public, the Democrats failed to build a defense against what the new administration is about to do, says former financial regulator Bill Black [...]"  

MSM: "Damning IMF Report Reveals Dysfunction Within Eurozone" [02/02/17] Printer Friendly Version "A new report by the International Monetary Fund (IMF) into the Eurozone single currency area of 19 states has accused them of running excessive deficits, distorted budgets and poor compliance with fiscal rules in the euro area, in a further example of the dysfunctionality of the currency. [...]" 

MSM: "Unanimous Fed Holds Rates As Expected; Does Not Hint At Imminent March Rate Hike" [02/02/17] Printer Friendly Version "...It may have failed, however, because the biggest highlight of the February statement (link) appears to be the line that "Market-based measures of inflation compensation remain low", which has been revised from the December version to remove the "measures have moved up considerably" language in what may be a dovish revision, and it appears the Fed is converging with the market's view of just 2 rate hikes in 2017. [...]"

Commentary: "Will Donald Trump Reverse The War On Cash?" Nick Giambruno [02/02/17] Printer Friendly Version "I recently sat down with my friend Jason Burack from Wall St for Main St. Jason and I had an in-depth discussion on the decline of globalism, the War on Cash, and more. I think you’ll enjoy our conversation. [...] Nick Giambruno: The War on Cash is a prop. It forces people out of cash and into banks. So it’s no surprise the war is ramping up as banking systems deteriorate. Then you have what Nassim Taleb would call the “Intellectual Yet Idiot” from Harvard—people like Ken Rogoff and Larry Summers who’ve made a cashless society their mission. And it all starts with eliminating the $100 bill. These people get prominent space in the mainstream financial media. They create an echo chamber of calls for a cashless society. It’s creepy and totalitarian. I mean, what kind of a person wakes up in the morning wanting to do things that would extinguish many of our remaining liberties? Privacy is a fundamental human right. It's necessary to protect human dignity, which is essential to a free society. But unfortunately, a lot of people have forgotten that. Also, in a cashless society, the government can concoct an unlimited number of new ways to confiscate your wealth. [...] The War on Cash is a mortal threat to individual and economic liberty. I think its advocates are clearly sociopaths and enemies of the common man. Unfortunately, I don’t see the war slowing down. I see it heating up. Just look at what happened in India recently. On the day of the US election—when the whole world was distracted—the Indian government ambushed its citizens. Instantly, and without warning, it declared certain high-value currency notes invalid. They said, “Oh, well, tax evaders, drug dealers, and terrorists use cash so we have to get rid of it or make it harder to use.” It’s completely ridiculous. Anybody who can think critically and independently can see right through this. It’s simply a clumsily executed power grab. It’s done nothing but create chaos and harm the Indian economy. Yet, when I read about it in the mainstream financial media, I often come across articles praising the Indian government for its bold reforms. It’s quite strange, like we’re living in a bizarro world. Instead of resisting, the Indian people sheepishly accepted their government’s blatant power grab. This will likely embolden other governments… and the Intellectual Yet Idiot class, of course. It means we should expect the War on Cash to accelerate in 2017. I haven’t seen any evidence suggesting Trump would reverse any of this[...]"  Related: "The Alternative Fact of the Cashless Society" Printer Friendly Version 

Corbett Report: "Who Is Responsible For The Global 'Cashless' Agenda?" [02/01/17] [43:16] "Demonetization. Cashless payments. Biometrics. Can you connect the dots? Join James today on The Corbett Report as he uncovers the truth about India’s recent demonetization and follows the trail to the coming cashless biometric control grid. [...]" Related: "A $500 Billion Pot Of Gold: How Boston Consulting And Google Pushed Modi To End The Era Of Cash" Printer Friendly Version "Boston Consulting Group (BCG), the omnipresent US-consulting company, and Google, the global data miner, issued a joint report in July 2016 on the “$500 bn Pot of Gold”, which is the Indian digital payment market. Even though the authors deny it, the report gives much reason to suspect that the authors knew that something radical was imminent from the Indian government. The report is remarkably honest about the aims of the whole exercise. There is no statement in the BCG-Google-report “Digital Payments 2020” to the effect that it is related to the joint initiative of USAID and the Indian ministry of finance, formally established in 2015, to push back the use of cash and promote digital payments. Rather it is presented as a freestanding initiative of BCG and Google. I reached out to one of the authors, BCG’s senior partner Alpesh Shah, to ask about this and he insisted: “This was a joint BCG-Google report, with no connection / relation to USAID/Indian Ministry of Finance.” However, there is much to suggest that there was a connection. First of all, the subject so perfectly fits with the program of that partnership. The subtitle of the report is “The Making of a $500 bn ecosystem in India”. The steering committee for the report included a representative of Visa, member of the Better Than Cash Alliance together with USAID and affiliate of the partnership of USAID and Indian finance ministry to advance digital payments. It also included PayTM and Vodafone, which are also part of the CATALYST coalition, a project, which according to USAID, is a “next step” in said partnership of USAID and the Indian finance ministry. The report is a call to arms for all payment service providers. They are alerted that things are going to be shaken up in India. On page three it says: [...]"| Also see below: "Washington Behind India’s Brutal Experiment Abolishing Most Cash" [01/06/17]; "As Cash Shortage Leads To Manufacturing Contraction, Economic Shockwaves, Indian Banks Slash Interest Rates" [01/03/17]; "India's Prime Minister Has Single-Handedly Crushed The Economy With His Reckless Cash Ban" [12/28/16] ; "Economy Shrinks Under 'Modi-Fied' India" Video [11:38] [12/28/16] ; "India Govt Decides Wealth Held By Its People Is ‘Hidden Wealth’ To Be Confiscated" [12/09/16] ; "India’s Demonetization “Shock Therapy”: State Sponsored Financial Repression" [11/28/16] 

Commentary: "Mnuchin Dashes Banker Hopes That Prop Trading Is Coming Back" [02/01/17] Printer Friendly Version "What a difference a week makes. On January 23, Reuters reported that dialing back the Volcker Rule which limits banks' ability to engage in speculative investments using their own balance sheet, has emerged a top priority for President Donald Trump's nominee for U.S. Treasury secretary, Steve Mnuchin. In written responses to questions posed by members of the U.S. Senate Finance Committee, Mnuchin said he would use his role as head of the interagency Financial Stability Oversight Council to give the Volcker Rule a stricter definition of proprietary trading. At issue is the Volcker Rule, a contentious provision in the 2010 Dodd-Frank Act that sought to prevent lenders from putting federally-insured deposits at risk through wagers on stocks, bonds and other assets. [...] According to Reuters, Mnuchin also said that "regulators have applied proprietary trading prohibitions to too many activities" adding that "In the responses Mnuchin also made it clear he believes the rule should only apply to "a bank that benefits from federal deposit insurance." The Federal Deposit Insurance Corporation guarantees retail deposits at about 6,000 banks, including the consumer banking arms of the country's largest investment banks." Just a few days later, in a follow up to Mnuchin's written responses, this time from Bloomberg, the interpretation of his statement was 180 degrees opposite, and as Bloomberg reported, "Steven Mnuchin made clear he doesn’t want Wall Street banks getting back into the business of making risky market bets with their own capital, after Senate Democrats pushed him to clarify his responses to questions they asked during his confirmation process to be Treasury secretary."[...]"  

Commentary: "Is Trump About To Hammer The Federal Reserve?" [02/01/17] Printer Friendly Version "Back in October of 2015 I wrote a post titled De-Fang the Federal Reserve – The Conspiracy on How the Fed is Being Integrated into the Multilateral Framework. It served as a summary of how the Fed acted as the global central bank almost from its inception in 1913 and how this would change in the lead up to a multilateral monetary framework. The Trump mandate on “America First” is being misconstrued as an isolationist policy but is in fact the cover for integrating America into the emerging multilateral. This is difficult to see for most because it is hard to reconcile the idea of an isolationist mandate with that of a multilateral mandate. It appears to most that America is dumping the globalist script when in fact the script is in fact the same only the characters and events have changed. The theme remains the same. This is one of the main reasons why the media is in fact pushing this isolationist script. It prevents Americans from accurately deciphering the shift towards the multilateral. The opposition to the Federal Reserve and the establishment was built up through alternative media to the point where the masses are now clamoring for the changes which in fact were always required in order to make the multilateral transition. The most obvious point is a changing role for the Federal Reserve. In a multilateral world it will no longer be required to serve the function as an international central bank providing access to a reserve asset. The Fed will be transformed to focus on domestic concerns while the international mandates begin to transition to an institution like the International Monetary Fund and the SDR asset. In the 2015 post on the Fed I referenced something called the Centennial Monetary Commission which was tasked with defining changes to the Federal Reserve’s roles and responsibilities. This study has now been completed and the recommendations are being made. Some of these recommendations were reviewed in the 2015 post, which is included below. Of course this will all be sold to the people as what is good for America as the “mismanaged Fed” is straightened out. The mainstream media will play its function as opposition to the Trump administration by rounding out the cognitive dissonance and getting the masses to accept all the changes that are coming. [...]"  

MSM: "Ron Paul: The Fed Is Tanking The Economy To Damage Trump" [01/30/17] Printer Friendly Version "The Federal Reserve is hell-bent on tanking the economy in order damage President Donald Trump and turn the people against him, according to former Rep. Ron Paul (R-TX). “The Federal Reserve’s policies of printing trillions of dollars back in ’08-09 have locked into place a serious financial crisis at some point in our future,” Paul stated. Explaining that the collapse will occur in the next 12-18 months, Paul warned that the unaccountable Federal Reserve is so powerful even the President won’t be able to stop the crisis. “It’s unavoidable, and even Donald Trump can’t stop it.” Paul said Trump will be the Fed’s patsy for the impending financial crash. “Trump will unfairly get the blame,” the former Texas representative wrote. [...]"  

Concepts and Practices: "How To Cut Infrastructure Costs In Half" [01/29/17] Printer Friendly Version "Americans could save $1 trillion over 10 years by financing infrastructure through publicly-owned banks like the one that has long been operating in North Dakota.  [...] President Donald Trump has promised to rebuild America’s airports, bridges, tunnels, roads and other infrastructure, something both Democrats and Republicans agree should be done. The country needs a full $3 trillion in infrastructure over the next decade. The $1 trillion plan revealed by Trump’s economic advisers relies heavily on public-private partnerships, and private equity firms are lining up for these plumbing investments. In the typical private equity water deal, for example, higher user rates help the firms earn annual returns of anywhere from 8 to 18 percent – more even than a regular for-profit water company might expect. But the price tag can come as a rude surprise for local ratepayers. [...] Private equity investment now generates an average return of about 11.8% annually on a 10-year basis. For infrastructure investment, those profits are made on tolls and fees paid by the public. Even at simple interest, that puts the cost to the public of financing $1 trillion in infrastructure projects at $1.18 trillion, more than doubling the cost. Cities often make these desperate deals because they are heavily in debt and the arrangement can give them cash up front. But as a 2008 Government Accountability Office report warned, “there is no ‘free’ money in public-private partnerships.” Local residents wind up picking up the tab. [...] There is a more cost-effective alternative. The conservative state of North Dakota is funding infrastructure through the state-owned Bank of North Dakota (BND) at 2% annually. In 2015, the North Dakota legislature established a BND Infrastructure Loan Fund program that made $50 million in funds available to communities with a population of less than 2,000, and $100 million available to communities with a population greater than 2,000. These loans have a 2% fixed interest rate and a term of up to 30 years. The proceeds can be used for the new construction of water and treatment plants, sewer and water lines, transportation infrastructure and other infrastructure needs to support new growth in a community. [...] If the Trump $1 trillion infrastructure plan were funded at 2% over 10 years, the interest tab would come to only $200 billion, nearly $1 trillion less than the $1.18 trillion expected by private equity investors. Not only could residents save $1 trillion over 10 years on tolls and fees, but they could save on taxes, since the interest would return to the government, which owned the bank. In effect, the loans would be nearly interest-free to the government."[...] Legislators in cash-strapped communities are likely to object, “We can’t afford to lend our revenues. We need them for our budget.” But banks do not lend their deposits. They actually create new money in the form of bank credit when they make loans. That means borrowing from its own bank is not just interest-free to the local government but actually creates new money for the local economy: [...] What about funding a federal infrastructure program with interest-free money? Tim Canova, Professor of Law and Public Finance at Nova Southeastern University, argues that the Federal Reserve could capitalize a national infrastructure bank with money generated on its books as “quantitative easing.” (Canova calls it “qualitative easing” – central bank-generated money that actually gets into the real economy.) The Federal Reserve could purchase shares, whether as common stock, preferred stock or debt, either in a national infrastructure bank or in a system of state-owned banks that funded infrastructure in their states. This could be done, says Canova, without increasing taxes, adding to the federal debt or hyperinflating prices. [...] Another alternative was proposed in 2013 by US Sen. Bernie Sanders and US Rep. Peter DeFazio. They called for a national infrastructure bank funded by the US Postal Service (which did provide basic banking services from 1911 to 1967). With post offices in nearly every community, the USPS has the physical infrastructure for a system of national public banks. In the Sanders/DeFazio plan, deposits would be invested in government securities used to finance infrastructure projects. Besides financing infrastructure without raising taxes, the plan could save the embattled USPS itself, while providing banking services for the one in four households that are unbanked or under-banked. [...] Reliance on costly private capital for financing public needs has limited municipal growth and reduced public services, while strapping future generations with unsustainable debt. By eliminating the unnecessary expense of turning public dollars into profits for private equity interests, publicly-owned banks can allow the public to retain ownership of its infrastructure while cutting costs nearly in half."  

Commentary: "Soros, Mastercard Launch Venture To Profit From Mass Migration" [01/27/17] Printer Friendly Version "Billionaire activist and arch globalist George Soros just won’t let his dream of a borderless, cultureless world free of Western values die. Soros is partnering with MasterCard Inc. to create Humanity Ventures, with the ostensible purpose of improving the lives of migrants through investments in education and health care, and fostering economic development in migrant communities. [...] “Migrants are often forced into lives of despair in their host communities because they cannot gain access to financial, healthcare and government services,” Soros said on Thursday in a joint statement with MasterCard" “Our potential investment in this social enterprise, coupled with MasterCard’s ability to create products that serve vulnerable communities, can show how private capital can play a constructive role in solving social problems,” he continued. [...] Soros is one of the world’s most prominent proponents of the displacement of Westerners and erosion of traditional Western identity through mass migration. His Open Society Foundations has donated millions of dollars to organizations and causes promoting everything from mass migration to radical feminism. His destructive activities are so prolific that last week, Szilard Nemeth, vice-chairman of Hungary’s ruling Fidesz Party, called for OSF and any organizations it funds to be banished from the country." [...]"  Related: "George Soros: The Self-Proclaimed ‘God’ Who Should Be In Prison" Printer Friendly Version 

MSM: "Dutch Regulator 'Accidentally' Reports Soros' Short Positions, Sends Bank Stock Sliding" [01/27/17] Printer Friendly Version "Some of hedge fund billionaire George Soros' short positions dating back to 2012 were published on the Dutch financial market regulator’s website this week due to "human error" according to the regulator AFM, according to Bloomberg. Dutch bank ING is among the positions exposed and its stock price is tumbling... As Bloomberg notes, the short positions, bets on a stock declining, were “between 0.2 percent and 0.5 percent,” of shares outstanding in the companies shorted, AFM spokesman Ward Snijders said by phone on Thursday. The Dutch regulator publishes shorts of 0.5 percent or higher on its website on a daily basis. The smaller amounts were posted by mistake, he said. The Financial Times earlier reported that some of the positions, including bets against Dutch banks, including ING Groep NV, appeared briefly on the website on Tuesday evening. ING declined to comment on Thursday. [...] Short positions, which are typically closely guarded, in Deutsche Bank AG jumped when it was revealed in June that Soros had bet that the stock would fall after the U.K. voted to leave the European Union. The German bank fell 14 percent on the first day after the ballot. The Dutch regulator’s spokesman couldn’t disclose whether there has been contact with Soros following Tuesday’s error. A spokesman for Soros didn’t immediately respond to an e-mail seeking comment."  

Commentary: "Nomi Prins: Financial Crash Possible In Last Quarter Of 2017" [01/23/17] [27:45] "Former top Wall Street banker and best-selling author Nomi Prins correctly predicted no financial crash for 2016. Prins’ upcoming book is titled “Artisans of Money.” It is all about central bank money creation. What does Prins say about this year? Prins predicts, “In 2016, I pegged the non-crash. . . . Central bankers were finding new ways to extend their money creation policies. That is what kept the markets up. There was a separate bid on the markets after Trump was elected. It was on the expectation that he would be good for growth, that he would be good for infrastructure and that he would create jobs. I do think there is a little juice in the central banks. I keep thinking there shouldn’t be, but they keep surprising all of us with their ability to boost the markets. They have artificially stimulated so many different asset bubbles, whether it’s debt, which is epic, or stock markets, many of which are at historic highs. If we have a crash, it will be in the second half of 2017. The promises, the rate hikes, the dollar being high could collapse into the realities of the stability and this artificialness. I am not sure about a crash this year, but if we see a big decline, it will be in the last quarter.” On the U.S. dollar, Prins says, “I think with the expectation of things going well, the dollar will be keeping a bit of a bid. It will be within a range but staying fairly up. I think the dollar will turn around and weaken in the second half of the year. . . .That’s why, in the last half of the year, gold will catch more of a bid.” (Meaning prices for gold will rise according to Prins.)  [...]"  

Commentary: "Trump Dump Coming To The Stock Market" [01/23/17] Printer Friendly Version "The stock market shot up like a Roman candle for idiotic reasons after the election. The candle may have reached its apex when the Dow hit 19,999.67 last week. As I stated in my Short Seller’s Journal, I was “stunned that bank traders were unable to push the index up to the holy grail number of 20,000. Of course, in and of itself, the “Dow 20k” watch was moronic. Thirty stocks do not an economic system make. Sorry Fox, CNBC, Bloomberg, CNN etc. [...] Essentially Trump promised on election night to spend trillions and cut taxes deeply and to pay for those based on borrowing trillions. These are policy proposals that are destined to fail from the moment the words left Trump’s mouth. But the stock market went nuts to the upside, culminating in what I would argue – based on using “apples to apples” accounting comparisons – the most overvalued U.S. stock market in history. Perhaps in the modern era only the Weimar German and Zimbabwe stock markets were more overvalued. Stay tuned because I am very confident that the Fed is not done printing trillions. [...]" 

Commentary: "Sen. Rand Paul Reintroduced ‘Audit The Fed’" [01/22/17] Printer Friendly Version "On Tuesday Jan 3rd, U.S. Senator Rand Paul reintroduced his Federal Reserve Transparency Act, widely known as the “Audit the Fed” bill, to prevent the Federal Reserve from concealing vital information on its operations from Congress. Eight cosponsors joined Senator Paul on the legislation. Representative Thomas Massie (KY-4) has introduced companion legislation, H.R. 24, in the U.S. House. “No institution holds more power over the future of the American economy and the value of our savings than the Federal Reserve,” said Sen. Paul, “yet Fed Chair Yellen refuses to be fully accountable to the people’s representatives.”  “The U.S. House has responded to the American people by passing Audit the Fed multiple times, and President-elect Trump has stated his support for an audit. Let’s send him the bill this Congress.” “The American public deserves more insight into the practices of the Federal Reserve,” said Rep. Massie. “Behind closed doors, the Fed crafts monetary policy that will continue to devalue our currency, slow economic growth, and make life harder for the poor and middle class. It is time to force the Federal Reserve to operate by the same standards of transparency and accountability to the taxpayers that we should demand of all government agencies.”  On January 12, 2016, a bipartisan Senate majority voted 53-44 in support of Audit the Fed. S. 16 would require the nonpartisan, independent Government Accountability Office (GAO) to conduct a thorough audit of the Federal Reserve’s Board of Governors and reserve banks within one year of the bill’s passage and to report back to Congress within 90 days of completing the audit.  You can read S. 16, the Federal Reserve Transparency Act, HERE PDF[...]" Related: "Audit The Fed' Bill Gets New Push Under Trump" Printer Friendly Version  

Commentary: "25 Years Of Neocon-Neoliberalism: Great For The Top 5%, A Disaster For Everyone Else" [01/21/17] Printer Friendly Version "It cannot be merely coincidental that the incomes and wealth of the top 5% have pulled away from the stagnating 95% in the 25 years dominated by neocon-neoliberalism. One unexamined narrative I keep hearing is: "OK, so neocon-neoliberalism was less than ideal, but Trump could be much worse." Let's start by asking: would Syrian civilians agree with this assessment? The basic idea in the "OK, so neocon-neoliberalism was less than ideal, but Trump could be much worse" narrative is that the modest problems created by neocon-neoliberalism will pale next to what Trump will do, implying jackbooted Waffen SS troops will soon be marching through America on Trump's orders. This narrative is yet another example of American parochialism: since neocon-neoliberalism didn't cause American cities to be bombed and its institutions demolished, it's really not that bad.  Try telling that to the Iraqis, Libyans and Syrians who have been on the receiving end of neocon- neoliberalism policies. The reality is very unpleasant: for those targeted by America's neocon-neoliberalism, nothing worse is imaginable, because the worst has already happened. [...] The cold reality is America's 25 years of neocon-neoliberalism has been great for the top 5% and an unmitigated disaster for everyone else in the U.S. and the nations it has targeted for intervention. Those defending the Democratic Party's 16 years of neocon-neoliberalism (Clinton and Obama) and the Republican Party's 8 years of neocon-neoliberalism (Bush) are defending a system that benefited the few at the expense of the many. Rather than admit the past 25 years have been catastrophic for the bottom 95%, the apologists speak darkly of fantastical visions of a Nazi America as a diversion to the grim truth that they have blindly supported an evil Empire that has stripmined the bottom 95% in America and laid waste to entire nations abroad. Neoconservatism's malignant spores hatched in the Reagan years, and spread quickly after the collapse of the Soviet Union. Stripped to its essence, Neoconservatism is American Exceptionalism turned into a global entitlement: it's our right to intervene anywhere in the world we choose to defend what we perceive as our interests, and it's our right to impose our version of democracy and a market economy on other peoples. [...] Self-interest melds seamlessly with moral superiority in neocon-neoliberalism. The moral justification is: since ours is the best possible system, we're doing you a favor by tearing down your institutions and imposing our system on you. The self-interest is: garsh, the "market" we imposed extracts your resources and benefits our banks and corporations. Amazing, isn't it, how "free markets" benefit everyone? But not equally. The claim of neoliberalism is: everything is transformed for the better when it is turned into a market. Once buyers and sellers can meet in a transparent marketplace, everybody prospers and everything becomes more efficient. Stripped to its essence, neoliberalism is: the markets we set up are rigged to favor those at the top. All that talk about free markets is just public-relations cover to mask an intrinsically rigged quasi-market that has features of "real" markets while beneath the surface, it's rigged to the advantage of big players at the top of the wealth-power pyramid.  [...] Neoconservatism and neoliberalism are both inherently global, and so globalization is the necessary outcome. There is no market that cannot be skimmed for outsized profits once it has been globalized, and so once bat guano becomes a global tradeable commodity, Goldman Sachs establishes a bat guano trading desk. (This is a spoof, but you get the point.)  Neoconservatism entitles the U.S. to have an "interest" (as in profitable interest) in every nook and cranny of the planet. Policy changes in Lower Slobovia? It's in our "interest" to monitor those changes and intervene if the policies are "not in our interests." Neocon-neoliberalism is brilliantly evil because it masks its true objectives behind such warm and fuzzy PR. Those looking for enemies of the people will find them not on the streets of America in cartoonish display but in the corridors of financial and policy power. Dear apologists of the status quo: do you understand you're defending this? Notice how the wealth of the bottom 90% nosedived once neocon-neoliberalism became the de facto policy of Democrats and Republicans alike. No wonder Obama's two terms seemed like Bush terms 3 and 4--in terms of a continuation of neocon-neoliberalism, they were. Yes, profound changes in technology, automation, and geopolitics have influenced finance and wealth, but it cannot be merely coincidental that the incomes and wealth of the top 5% have pulled away from the stagnating 95% in the 25 years dominated by neocon-neoliberalism[...]" 

Commentary: "Alibaba's Jack Ma Drops Redpill In Davos: The U.S. Wasted $14 Trillion On Wars Over The Past 30 Years" [01/19/17] Printer Friendly Version "And there it is, the unvarnished, raw, truth about how everything went wrong for middle class America. Since the Vietnam war, more than 45 years ago, the US has embarked on a neocon strategy of war in an effort to build a global empire. The result of that strategy has left American infrastructure second rate, its school system in shambles, and its healthcare system a complete and utter joke. Just imagine what America could've done with $14t of invest able dollars, instead of waging wars. Aside from the wars, America spends more than 50% of its discretionary budget on the military, per annum, 16% of its overall budget. That's the main issue, the sordid topic that is rarely discussed in American politics, for fears of crossing the military-industrial complex.  [...] Jack Ma from Alibaba doesn't share those same fears, being a Chinese national worth $27b. In a very rare glimpse into what the Chinese really think about American imperialism and how it shaped the global economy, all the better for China might I add, Jack Ma spoke candidly today in an interview with CNBC's Andrew Ross Sorkin: "Jack Ma Slams Wasteful US Policies" [1:48] "It's not that other countries steal jobs from you guys," Ma said. "It's your strategy. Distribute the money and things in a proper way."  He said the U.S. has wasted over $14 trillion in fighting wars over the past 30 years rather than investing in infrastructure at home. To be sure, Ma is not the only critic of the costly U.S. policies of waging war against terrorism and other enemies outside the homeland. Still, Ma said this was the reason America's economic growth had weakened, not China's supposed theft of jobs. In fact, Ma called outsourcing a "wonderful" and "perfect" strategy. "The American multinational companies made millions and millions of dollars from globalization," Ma said. "The past 30 years, IBM, Cisco, Microsoft, they've made tens of millions — the profits they've made are much more than the four Chinese banks put together. ... But where did the money go?"  He said the U.S. is not distributing, or investing, its money properly, and that's why many people in the country feel wracked with economic anxiety. He said too much money flows to Wall Street and Silicon Valley. Instead, the country should be helping the Midwest, and Americans "not good in schooling," too. "You're supposed to spend money on your own people," Ma said. "Not everybody can pass Harvard, like me." In a previous interview, Ma said he had been rejected by Harvard 10 times. Along those lines, Ma stressed that globalization is a good thing, but it, too, "should be inclusive," with the spoils not just going to the wealthy few. [...]"   Note: Jack Ma has met with Trump, and had this to say [3:12] | Related: "Jack Ma - On 60 Minutes CBS, June 2015" [23:40] 

MSM: "Foreign Central Banks Liquidate Record $405 Billion In US Treasuries" [01/19/17] Printer Friendly Version "The wholesale liquidation of US Treasuries continued in November, when according to the just released TIC data, foreign central banks sold another $936 million in US paper in November 2016, which due to an offset of $892 million in buying one year ago, means that for the 12 month period ended November, foreign central banks have now sold a new all time high of $405 million in the past 12 months, up from a record $403 million in LTM sales as of one month ago. While Japan sold about $23 billion in November, its fourth month of consecutive selling, it was China which drove the selloff, dumping a whopping $66.4 billion in US Treasuries in its 6th consecutive monthly sale of US paper, and the biggest monthly selloff since December 2011. The monthly sale also brings China's total Treasury holdings to the lowest level since early 2010. [...]"  

Commentary: "How Chuck Schumer Caused Bank Collapse Dems Now Blame On Trump’s Treasury Nominee" [01/17/17] Printer Friendly Version "Senate Democrats — led by senators Elizabeth Warren of Massachusetts and Vermont Independent Bernie Sanders — hope to defeat Steven Mnuchin, President-elect Donald Trump’s nominee for Treasury Secretary, by focusing on his alleged role in the 2008 collapse of California’s IndyMac bank. Warren has launched a web page on the official United States Senate website that calls Mnuchin, “the foreclosure king” because, as she and left-wing activists charge, he threw thousands of homeowners onto the street after he bought IndyMac. Mnuchin’s Senate confirmation hearing begins Thursday. But The Daily Caller News Foundation’s Investigative Group (TheDCNF) has uncovered extensive evidence that the person who triggered IndyMac’s financial crisis, which led to one of the largest bank failures in American history, was Senate Minority Leader Chuck Schumer of New York. [...] Schumer started a $100 million-a-day run on the bank after he gave reporters a letter on June 26, 2008, addressed to federal regulators saying he was “concerned that IndyMac’s financial deterioration poses significant risks to both taxpayers and borrowers.” The letter spooked depositors who in the next 11 days withdrew a record $1.3 billion from the bank. [...] News reports filed at the time squarely place the blame the bank’s failure on Schumer. The Los Angeles Times, for example, reported July 2, 2008, that “the letter stunned some Wall Street analysts, who said Schumer was in effect sealing the lender’s fate by raising the prospect of its failure.” Schumer’s action was so irresponsible that the federal Office of Thrift Supervision explicitly blamed Schumer for IndyMac’s collapse, saying in a July 11, 2008, press release that “the immediate cause of the closing was a deposit run that began and continued after the public release of a June 26 letter to the OTS and the FDIC from Senator Charles Schumer of New York.” OTS director John D. Reich went further saying, “When a member of the United States Senate makes such a public statement, it doesn’t take much to frighten the depositors of an institution,” according to the Washington Post. “It was an unprecedented act on the senator’s part and the result speaks for itself.” Comptroller of the Currency John D. Hawke, who began his term during President Clinton’s tenure, said Schumer’s act was “incredibly stupid,” adding that “leaking his IndyMac letter to the press was reckless and grossly irresponsible. I don’t see how he can be trusted with confidential information in the future.” [...]"  

Commentary: "Starvation, Malnutrition And Disease As A Result Of India’s Demonetization Experiment" [01/17/17] Printer Friendly Version "Reports from the rural and semi-rural areas of India, from towns and villages, already indicate that hunger is widespread because of the nonexistence of cash. This artificial crisis was created on November 8, 2016 when Prime Minister Narendra Modi arbitrarily declared 86% of the nation’s currency worthless as legal tender—a draconian diktat taken without any prior discussion with his cabinet, Parliament, or the people. The so-called demonetisation policy has had devastating effects across all sectors of Indian society, crippling businesses and farmers, causing retail stores and vendors to shut down, increasing unemployment, and forcing ordinary people to lose billions of man-hours and woman-hours waiting in endless queues at banks to exchange unusable currency notes or to withdraw the meager cash allowed. [...]"  Related: "India’s Rising Income Inequality: Richest 1% Own 58% Of Total Wealth" Printer Friendly Version "57 billionaires in India now have same wealth ($ 216 billion) as that of the bottom 70 per cent population of the country. Globally, just 8 billionaires have the same amount of wealth as the poorest 50 per cent of the world population+ . [...]" 

Commentary: "Pharma And Lockheed Martin Stocks Tumble After Trump Criticizes Overpayments" [01/12/17] Printer Friendly Version "President-elect Donald Trump lashed out at overspending on drugs and fighter jets during his press conference on Wednesday, giving progressives something to hope for but sending stocks in related companies diving. First, he took aim at the drug industry, complaining that it is making too many of its products overseas and that the government does not negotiate with the industry for prices for the Medicare program. “We have to get our drug industry coming back. Our drug industry has been disastrous, they’ve been leaving left and right,” he said. “The other thing we have to do is create new bidding procedures for the drug industry because they’re getting away with murder. Pharma, Pharma has a lot of lobbyists — a lot of lobbyists — a lot of power, and there’s very little bidding on drugs. We’re the largest buyer of drugs in the world and yet we don’t bid properly and we’re going to start bidding and we’re going to save billions of dollars over time.” [...] Drug price negotiation has long been a goal of progressive health policy advocates, and was something that both Trump and Clinton campaigned on during the presidential election. Medicare is currently prohibited by law from negotiating drug prices — unlike other parts of the government, such as the VA. It is estimated the government could save up to $16 billion annually if it simply was allowed to negotiate with companies for the prices. The president-elect can’t do this unilaterally, however — he would have overturn a law passed by Congress, and thus would need the backing of lawmakers before making this change.[...]"   Related: "Pharma Pricing Furor Gaining Steam" Printer Friendly Version  

Commentary: "How Goldman Sachs Became The Overlord Of The Trump Administration" [01/10/17] Printer Friendly Version "During his political campaign, Donald Trump repeatedly railed against Wall Street with a specific focus on Goldman Sachs. How did a candidate who repeatedly demonized Goldman Sachs as the poster child for a corrupt establishment that owned Washington end up with Goldman Sachs’ progeny filling every post that even tangentially has the odor of money or global finance? One answer is family ties; another may be something darker. [...] Trump’s non-stop nominations and appointments of Goldman Sachs alumni have left his supporters stunned. Trump nominated Steven Mnuchin, a 17-year veteran of Goldman Sachs to be his Treasury Secretary. Stephen Bannon, another former Goldman Sachs banker, was named by Trump as his Chief Strategist in the White House. The sitting President of Goldman Sachs, Gary Cohn, has been named by Trump as Director of the National Economic Council, which, according to its website, coordinates “policy-making for domestic and international economic issues.” Last week, in a move that stunned even Wall Street, Trump nominated a Goldman Sachs outside lawyer, Jay Clayton of Sullivan & Cromwell, to serve as Wall Street’s top cop as Chairman of the Securities and Exchange Commission. Adding to the slap in the face to Trump’s working class supporters, Clayton’s wife currently works as a Vice President at Goldman Sachs. But the Goldman Sachs’ ties don’t stop there.[...]"  

Social Experimentation: "Washington Behind India’s Brutal Experiment Abolishing Most Cash" [01/06/17] Printer Friendly Version "In early November, without warning, the Indian government declared the two largest denomination bills invalid, abolishing over 80 percent of circulating cash by value. Amidst all the commotion and outrage this caused, nobody seems to have taken note of the decisive role that Washington played in this. That is surprising, as Washington's role has been disguised only very superficially.  US-President Barack Obama has declared the strategic partnership with India a priority of his foreign policy. China needs to be reined in. In the context of this partnership, the US government’s development agency USAID has negotiated cooperation agreements with the Indian ministry of finance. One of these has the declared goal to push back the use of cash in favor of digital payments in India and globally. On November 8, Indian prime minster Narendra Modi announced that the two largest denominations of banknotes could not be used for payments any more with almost immediate effect. Owners could only recoup their value by putting them into a bank account before the short grace period expired at year end, which many people and businesses did not manage to do, due to long lines in front of banks. The amount of cash that banks were allowed to pay out to individual customers was severely restricted. Almost half of Indians have no bank account and many do not even have a bank nearby. The economy is largely cash based. Thus, a severe shortage of cash ensued. Those who suffered the most were the poorest and most vulnerable. They had additional difficulty earning their meager living in the informal sector or paying for essential goods and services like food, medicine or hospitals. Chaos and fraud reigned well into December.[...] Four weeks earlier: Not even four weeks before this assault on Indians, USAID had announced the establishment of "Catalyst: Inclusive Cashless Payment Partnership", with the goal of effecting a quantum leap in cashless payment in India. The press statement of October 14 says that Catalyst “marks the next phase of partnership between USAID and Ministry of Finance to facilitate universal financial inclusion”.[...] Catalyst’s Director of Project Incubation is Alok Gupta, who used to be Chief Operating Officer of the World Resources Institute in Washington, which has USAID as one of its main sponsors. He was also an original member of the team that developed Aadhaar, the Big-Brother-like biometric identification system. [...] According to a report of the Indian Economic Times, USAID has committed to finance Catalyst for three years. Amounts are kept secret. Badal Malick, CEO of Catalyst, commented: "Catalyst’s mission is to solve multiple coordination problems that have blocked the penetration of digital payments among merchants and low-income consumers. We look forward to creating a sustainable and replicable model. (...) While there has been (...) a concerted push for digital payments by the government, there is still a last mile gap when it comes to merchant acceptance and coordination issues. We want to bring a holistic ecosystem approach to these problems." The multiple coordination problem and the cash-ecosystem-issue that Malick mentions had been analysed in a report that USAID commissioned in 2015 and presented in January 2016, in the context of the anti-cash partnership with the Indian Ministry of Finance. The press release on this presentation is also not in USAID's list of press statements (anymore?). The title of the study was “Beyond Cash”. "Merchants, like consumers, are trapped in cash ecosystems, which inhibits their interest” in digital payment it said in the report. Since few traders accept digital payments, few consumers have an interest in it, and since few consumers use digital payments, few traders have an interest in it. Given that banks and payment providers charge fees for equipment to use or even just try out digital payment, a strong external impulse is needed to achieve a level of card penetration that would create mutual interest of both sides in digital payment options." [...] It turned out in November that the declared “holistic ecosystem approach” to create this impulse consisted in destroying the cash-ecosystem for a limited time and to slowly dry it up later, by limiting the availability of cash from banks for individual customers. Since the assault had to be a surprise to achieve its full catalyst-results, the published Beyond-Cash-Study and the protagonists of Catalyst could not openly describe their plans. They used a clever trick to disguise them and still be able to openly do the necessary preparations, even including expert hearings. They consistently talked of a regional field experiment that they were ostensibly planning. [...] Only in November did it became clear that the whole of India should be the guinea-pig-region for a global drive to end the reliance on cash. Reading a statement of Ambassador Jonathan Addleton, USAID Mission Director to India, with hindsight, it becomes clear that he stealthily announced that, when he said four weeks earlier: “India is at the forefront of global efforts to digitize economies and create new economic opportunities that extend to hard-to-reach populations. Catalyst will support these efforts by focusing on the challenge of making everyday purchases cashless."[...]" Related: "India, From The Destabilization Of Agriculture To Demonetization, “Made In America”" Printer Friendly Version | See also below: "As Cash Shortage Leads To Manufacturing Contraction, Economic Shockwaves, Indian Banks Slash Interest Rates" [01/03/17]; "India's Prime Minister Has Single-Handedly Crushed The Economy With His Reckless Cash Ban" [12/28/16] ; "Economy Shrinks Under 'Modi-Fied' India" Video [11:38] [12/28/16] ; "India Govt Decides Wealth Held By Its People Is ‘Hidden Wealth’ To Be Confiscated" [12/09/16] ; "India’s Demonetization “Shock Therapy”: State Sponsored Financial Repression" [11/28/16] 

Social Experimentation: "Cash Ban Continues, Greece Initiates Soft Cash Ban" [01/06/17] [3:30] "The cash ban didn’t stop with India, Greece is now the next test case for the central bankers. The central bankers are now pushing their agenda to ban cash. [...]" "Greece Bans Cash: Tax-Allowance Possible Only Through Payments Via Plastic Money" Greece Printer Friendly Version "Greece is banning the use of cash the soft way. As of 1.1. 2017, taxpayers will be granted tax-allowance and tax deduction only when they have made payments via credit or debit cards. The new guidelines refer to employees, pensioners, farmers but also unemployed. Exempted from the compulsory usage of credit/debit cards are seniors over 70 years old, residents of remote areas and people with disability over 80%. I suppose they will have to continue the collection of paper receipts. [...] "Should a taxpayer will not be able to spend the necessary percentage of the annual income according to the guidelines, the punishment will be a penalty of 22% imposed on the missing difference."  [...]" Note: Bizarre, control freakism plan thought up by knuckle-dragging thugs. Time for a revolt, apparently.

MSM: "U.S. Quietly Drops Bombshell: Wall Street Banks Have $2 Trillion European Exposure" [01/05/17] Printer Friendly Version "Just 17 days from today, Donald Trump will be sworn in as the nation’s 45th President and deliver his inaugural address. Trump is expected to announce priorities in the areas of education, infrastructure, border security, the economy and curtailing the outsourcing of jobs. But Trump’s agenda will be derailed on all fronts if the big Wall Street banks blow up again as they did in 2008, dragging the U.S. economy into the ditch and requiring another massive taxpayer bailout from a nation already deeply in debt from the last banking crisis. According to a report quietly released by the U.S. Treasury’s Office of Financial Research less than two weeks before Christmas, another financial implosion on Wall Street can’t be ruled out. [...] The Office of Financial Research (OFR), a unit of the U.S. Treasury, was created under the Dodd-Frank financial reform legislation of 2010. It says its role is to: “shine a light in the dark corners of the financial system to see where risks are going, assess how much of a threat they might pose, and provide policymakers with financial analysis, information, and evaluation of policy tools to mitigate them.” Its 2016 Financial Stability Report, released on December 13, indicates that Wall Street banks have been allowed by their “regulators” to take on unfathomable risks and that dark corners remain in the U.S. financial system that are impenetrable to even this Federal agency that has been tasked with peering into them. [...] At a time when international business headlines are filled with reports of a massive banking bailout in Italy and the potential for systemic risks from Germany’s struggling giant, Deutsche Bank, the OFR report delivers this chilling statement: “U.S. global systemically important banks (G-SIBs) have more than $2 trillion in total exposures to Europe. Roughly half of those exposures are off-balance-sheet…U.S. G-SIBs have sold more than $800 billion notional in credit derivatives referencing entities domiciled in the EU.” [...] When a Wall Street bank buys a credit derivative, it is buying protection against a default on its debts by the referenced entity like a European bank or European corporation. But when a Wall Street bank sells credit derivative protection, it is on the hook for the losses if the referenced entity defaults. Regulators will not release to the public the specifics on which Wall Street banks are selling protection on which European banks but just the idea that regulators would allow this buildup of systemic risk in banks holding trillions of dollars in insured deposits after the cataclysmic results of similar hubris in 2008 shows just how little has been accomplished in terms of meaningful U.S. financial reform. [...]"

MSM: "European Stocks Greet The New Year By Rising To One Year Highs; Euro Slides" [01/04/17] Printer Friendly Version "While most of the world is enjoying it last day off from the 2017 holiday transition, with Asia's major markets closed for the New Year holiday, along with Britain and Switzerland in Europe and the US and Canada across the Atlantic, European stocks climbed to their highest levels in over a year on Monday after the Markit PMI survey showed manufacturing production in the Eurozone rose to the highest level since April 2011. [...]" 

Commentary: "Trump Effect: Re-Energized Dollar Looms Over The Rest Of The World" [01/04/17] Printer Friendly Version "On Wall Street, the rising dollar has been one of the most visible signals of growing optimism in the U.S. economy. For many other countries, it spells trouble. Most analysts expect the U.S. currency to strengthen in 2017, extending a gain that has boosted the value of the dollar by more than one-third since the U.S. credit downgrade in 2011. That expectation is mostly because a strengthening economy appears likely to enable the Federal Reserve to enact its plan for multiple rate increases in 2017. Higher rates make it more attractive to hold dollar-denominated assets, attracting money into the U.S. [...]" 

Commentary: "Venture Capitalist Warns Of Government Backlash Against Google, Facebook 'Monopolies' In 2017" [01/04/17] Printer Friendly Version "..Google, Facebook, and to a lesser extent Apple and Amazon will be seen as monopolists by government and individuals in the US (as they have been for years outside the US). It will be Microsoft redux and the government will seek remedies which will be futile. Here’s what I expect to happen this year: [...] These are my big predictions for 2017. If my prior track record is any indication, I will be wrong about more of this than I am right. The beauty of the VC business is you don’t have to be right that often, as long as you are right about something big. Which leads to going out on a limb and taking risks. And I think that strategy will pay dividends in 2017. Here’s to a new year and new challenges to overcome.[...]"  Note: Submitted by Fred Wilson via AVC.com

MSM: "As Cash Shortage Leads To Manufacturing Contraction, Economic Shockwaves, Indian Banks Slash Interest Rates" [01/03/17] Printer Friendly Version "Over 50 days after Indian Prime Minister Narenda Modi stunned India's population when he announced on November 8 he would unexpectedly eliminate 86% of the existing currency in circulation in what was supposed to be a crackdown on the shadow economy, but instead has resulted in a significant hit to the broader, cash-based economy, overnight we noted the first official confirmation of how substantial the impact of Modi's demonetization has been, when the Nikkei India Manufacturing Purchasing Managers Index printed at 49.6 in December, the first contraction reading since December 2015, as the war on cash crippled demand. [...] According to the report, output and new orders fall for first time in one year; companies reduced buying levels and payroll numbers; Input cost inflation accelerated, while charges rose at softer rate. Commenting on the report, IHS Markit economist Pollyanna De Lima said that “having held its ground in November following the unexpected withdrawal of 500 and 1,000 bank notes from circulation, India’s manufacturing industry slid into contraction at the end of 2016. Shortages of money in the economy steered output and new orders in the wrong direction, thereby interrupting a continuous sequence of growth that had been seen throughout 2016. Cash flow issues among firms also led to reductions in purchasing activity and employment. Looking at the upcoming timeline of cash exchanges, she noted that "with the window for exchanging notes having closed at the end of December, January data will be key in showing whether the sector will see a quick rebound.” As Bloomberg added, other recent data also mirror the stress. Motorcycle maker Bajaj Auto Ltd.’s total sales slipped 22 percent in December, the steepest fall in at least 21 months. Motorcycle sales, a key indicator of rural demand, declined 18%. India’s biggest automaker by volume, Maruti Suzuki Ltd., reported a 4.4 percent drop in domestic December sales, the first decline in six months, while overall sales fell 1 percent from a year earlier. A continued slowdown will strip India of its position as one of the world’s fastest-growing big economies and risk a political backlash against Modi. On Wednesday another key economic report is due, when the Service PMI data is due before focus shifts to the government’s first official growth estimate for the year through March. India’s economy, which until recently was expected to be the world's fastest growing, large economy, outpacing China [...] Meanwhile, in an attempt to offset the slowing economy as a result of the Prime Minister's unprecedented demonetization gamble, overnight Indian banks, led by market leader State Bank of India, announced sharp cuts to their lending rates after the recent surge in deposits as ordinary Indians brought their cash to the bank for "safekeeping", raising hopes that lower borrowing costs will help spark credit growth in Asia's third-largest economy. [...]"  Related: "India's Prime Minister Has Single-Handedly Crushed The Economy With His Reckless Cash Ban" [12/28/16] ; "Economy Shrinks Under 'Modi-Fied' India" Video [11:38] [12/28/16] ; "India Govt Decides Wealth Held By Its People Is ‘Hidden Wealth’ To Be Confiscated" [12/09/16] ; "India’s Demonetization “Shock Therapy”: State Sponsored Financial Repression" [11/28/16] 

 

       

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