US Intelligence Developing Better Storage To Hoard Your Data Based On Human DNA

Authored by Mac Slavo via SHTFplan.com,

Since the United States insists on spying its own people and saving massive amounts of personal data, the government is running out of storage space.  So now, they are developing a new and improved data storage system based on human DNA.

It’s obvious the spying isn’t going to stop, and the US is no longer making it a secret that they want every scrap of data available on you stored. The Molecular Information Storage program, run by the Intelligence Advanced Research Projects Activity (IARPA), is recruiting scientists to help develop a system for storing huge amounts of data on sequence-controlled polymer, molecules with a similar makeup and structure to DNA.

According to RT, US intelligence services struggle to store the trove of data collected during their snooping operations, so a team of researchers is developing the radical new storage technology. The issue for the government of how to store data is one the world’s intelligence services intend to solve for the overbearing governments of the planet. Costly data centers take up huge amounts of land, which is unsustainable given the increasing amount of data generated by each person on a daily basis.

Some data centers are currently being housed in urban locations. The Lakeside Technology Center in Chicago is the largest data storage facility in the US. It spans a whopping 1.1 million square feet, which is equivalent to an entire city block. The site is actually at the location of the former printing press for the Yellow Pages, but the center was transformed in 1999 and now holds more than 50 generators whirring around the clock. The Chicago facility is only matched by the NSA’s $1.5 billion Bumblehive data center in Bluffdale, Utah, which is just over 1 million square feet.

This new technology being developed by the US has huge potential as researchers believe DNA-like polymer technology can store data more than 100,000 times more efficiently than current methods. The IARPA hopes that it could one-day process entire exabytes of data while reducing the amount of physical space required to store all that personal information. To give you an idea of the scale: one exabyte, or one quintillion bytes, is four million times the storage capacity of a 256GB iPhone X. 

“Faced with exponential data growth, large data consumers may soon face a choice between investing exponentially more resources in storage or discarding an exponentially increasing fraction of data,” the IARPA said in a statement cited by Nextgov. And we all know the government cannot be bothered to leave us alone and give us privacy, so they intend to spend a lot of our money so they can continue to keep tabs on all of us. It’s actually rather demented when one logically thinks about it.

There are three distinct strands to the project, reported RT. The agency is hoping to create systems for storing and retrieving information, as the IARPA is calling on developers to help put together an easy-to-use operating system.

We will never have privacy again if the US government has anything to say about it.

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Bank Of Japan Leaves Policy Unchanged, Downgrades Inflation, Continues ‘Stealth’ Taper

Yen is weaker following The BOJ’s decision (with one dissent) to leave policy rates unchanged and maintain their JGB holdings target. BoJ did downgrade their inflation outlook but made no mention of its ongoing ‘stealth’ bond-buying taper.

  • BOJ Maintains 10-Year JGB Yield Target at About 0.000%
  • BOJ Maintains Policy Balance Rate at -0.100%
  • Bank of Japan Downgrades Assessment of CPI – BOJ Sees CPI in Range of 0.5% to 1.0%
  • As expected, the BOJ has retained the 80 trillion yen bond-buying target that hasn’t been hit for some time now. This showcases just how careful the BOJ is about even the most minor tweak in its policy guidance.

The reaction is a weaker yen for now…

While The Bank of Japan’s policies drift further and further away from The Fed and ECB (admittedly BoJ has tapered down its bond-buying ever so quietly), it is hardly surprising that Kuroda didn’t go full hawktard as economic data has been dismal this year and a recession looms…

Japanese economic data is the most disappointing since 2014…

And the economy is shrinking once again…

 

While no official policy adjustment has been made, The BoJ has been stealth tapering for months…

“Market players have come to realize that the bond-purchase operations aren’t directly linked to monetary policy,” said Mari Iwashita, chief market economist at Daiwa Securities Co. in Tokyo. “Their action is dependent on conditions and does not indicate anything special in store.”

 

 

 

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“No Escape”: Don’t Expect A Yemeni Version Of The White Helmets

Have you noticed the almost complete lack of video footage showing the ongoing Arab and US coalition aerial bombardment of Yemen’s key port city of Al Hudaydah? 

Reuters reports the following:

“People are scared. The warships are terrifying and warplanes are flying overhead all the time,” university student Amina, 22, who lives near the port, told Reuters by telephone.

“People are fleeing the city to the countryside, but for those with no relatives there or money, there is no escape.”

Don’t expect a Yemeni version of the “White Helmets” to emerge with high-tech cameras, slick new gear, and professional uniforms capturing Yemen’s starvation and slow death under US, Saudi, and UAE warplanes.

Smoke rises from Al Hudaydah city of Yemen after Saudi-led coalition air attack. Image source: Anadolu, Getty 

Don’t expect prime time news broadcasts to feature images of emaciated Yemeni babies — easily located on social media channels in the thousands.

And yet he numbers are staggering, as Reuters reports further:

The United Nations says 22 million Yemenis need humanitarian aid, and the number at risk of starvation could more than double to more than 18 million by year end unless access improves.

No, there won’t be rebel leaders in Yemen beamed into CNN studios via Skype to detail the suffering of civilians under the brutal siege, because this isn’t Syria… it’s Yemen, where the US and its allies have not only imposed a full military blockade of land, air, and sea on an urban population of half a million people, but have also ensured a complete media blackout of on the ground footage and reporting. 

As we noted in our initial coverage the complete media and humanitarian blockade on the contested port city of Al Hudaydah means confirmation of the rapidly unfolding events have been hard to come by, though we featured what’s purported to be some of the earliest social media footage of the assault, now in its second day. 

But what is firmly established concerning the conflict?

First, the Wall Street Journal has characterized the US role in the new operation as actually “deepening” as US intelligence will provide “information to fine-tune the list of targets”. The US has long been a lead and integral part of the coalition (also including Bahrain, Kuwait, UAE, Egypt, Sudan, and with the UK as a huge supplier of weapons) fighting Shia Houthi rebels, which overran the Yemen’s north in 2014.

Saudi airstrikes on the impoverished country have involved the direct assistance of US intelligence and use of American and British military hardware. Cholera has also made a comeback amidst the appalling war-time conditions, and civilian infrastructure such as hospitals have been bombed by the Saudi-UAE-US coalition. The coalition claims to ultimately be thwarting Iranian ambitions inside Yemen. 

Second, the ongoing Arab and US coalition siege of Yemen’s major port city through which 80% of all humanitarian aid for the war-torn country flows could result in the greatest humanitarian disaster and mass starvation in all of recent history according to the United Nations

The city of half a million is one of the sole lifelines of support for Yemen’s over 27 million people from the outside world, thus analysts are predicting this to be a catastrophe for the country’s civilian population in a war The New York Times notes is already “classified as the world’s worst humanitarian disaster with “more than 75 percent of the population… dependent on food aid”.

A new Reuters report estimates that “8.4 million people are on the verge of starvation, potentially the world’s worst famine for generations.”

And yet on Thursday the US State Department announced it would resume funding for the controversial Syrian NGO state-funded group, the White Helmets, to the tune of $6.6, with presumably more American taxpayer funds to come. The group has long been exposed as essentially playing rescue squad for al-Qaeda and is a creation of international PR firms pushing for regime change in Syria

But again, might Yemen get its own US-funded version of the White Helmets to rescue civilians?

Why is there no video or photographic media coverage of US, Saudi, and UAE bombs raining down on masses of civilians in Al Hudaydah? Of course, the answer is obvious. 

* * *

Early in the Yemeni war the prestigious Columbia Journalism Review produced a short study which attempted to explain, according to its title, Why almost no one’s covering the war in Yemen (in short genocide is OK when US allies do it, according to the actions and words of Western political leaders).

Other analysts have since criticized the media and political establishment’s tendency to exaggerate Iran’s presence in Yemen and further willingness to ignore or downplay the clear war crimes of US client regimes in the gulf (the US-Saudi coalition claims it must liberate Al Hudayda to cut off Iranian weapons flowing to Houthi rebels). While Iran-aligned states and militias are framed as the region’s terrorizers, the Saudi-aligned coalition’s motives are constantly cast as praise-worthy and noble.

Meanwhile, the Pentagon has long reiterated its official (Orwellian) line that the US military’s deep level of assistance to the Saudi bombing campaign is actually geared toward reducing civilian harm. One glaring example is contained in an Al-Monitor report from earlier this year: “Speaking to reporters at the Defense Department on the heels of a meeting with Saudi Arabia’s Crown Prince Mohammed bin Salman last week, Mattis said a contingent of US advisers deployed to help with intelligence sharing are engaged in a ‘dynamic’ role to help ensure a reduction in civilian harm.”

But Al Monitor also noted that civilian deaths had continued unabated, while further quoting Mattis as saying, “This is the trigonometry level of warfare.”

So the official Pentagon line on Yemen seems to be (confirmed repeatedly this week) that as it directly assists the Saudis in dropping bombs on civilians, it is actually “helping” those very civilians. 

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The Fed Is “Living Dangerously” – The Great Financial Crisis “Will Be Eclipsed”

Authored by Alasdair Macleod via GoldMoney.com,

Regular readers of Goldmoney’s Insights should be aware by now that the cycle of business activity is fuelled by monetary policy, and that the periodic booms and slumps experienced since monetary policy has been used in an attempt to manage economic outcomes are the result of monetary policy itself. The link between interest rate suppression in the early stages of the credit cycle, the creation of malinvestments and the subsequent debt dénouement was summed up in Hayek’s illustration of a triangle, which I covered in an earlier article.

Since Hayek’s time, monetary policy, particularly in America, has evolved away from targeting production and discouraging savings by suppressing interest rates, towards encouraging consumption through expanding consumer finance. American consumers are living beyond their means and have commonly depleted all their liquid savings. But given the variations in the cost of consumer finance (between 0% car loans and 20% credit card and overdraft rates), consumers are generally insensitive to changes in interest rates.

Therefore, despite the rise of consumer finance, we can still regard Hayek’s triangle as illustrating the driving force behind the credit cycle, and the unsustainable excesses of unprofitable debt created by suppressing interest rates as the reason monetary policy always leads to an economic crisis. The chart below shows we could be living dangerously close to another tipping point, whereby the rises in the Fed Funds Rate (FFR) might be about to trigger a new credit and economic crisis.

Previous peaks in the FFR coincided with the onset of economic downturns, because they exposed unsustainable business models. On the basis of simple extrapolation, the area between the two dotted lines, which roughly join these peaks, is where the current FFR cycle can be expected to peak. It is currently standing at about 2% after yesterday’s increase, and the Fed expects the FFR to average 3.1% in 2019. The chart tells us the Fed is already living dangerously with yesterday’s hike, and further rises will all but guarantee a credit crisis.

The reason successive interest rate peaks have been on a declining trend is bound up in the rising level of outstanding debt and loans, shown by the red line on the chart. Besides a temporary slowdown during the last credit crisis, debt has been increasing over every cycle. Instead of sequential credit crises eliminating malinvestments, it is clear the Fed has prevented debt liquidation for at least the last forty years. The accumulation of debt since the 1980s is behind the reason for the decline in interest rate peaks over time.

A quarter-point rise in interest rates, if it is reflected in the cost of servicing all outstanding debt, would be a burden to debtors of $167bn, and the increase from the zero bound is an added liability of over a trillion dollars so far. But it is more accurate and relevant to regard much of the accumulated debt as not immediately relevant, because it is in fixed interest bonds, including US Treasuries, and similar medium-term loans. Furthermore, where variable interest rates apply, nearly all major corporations have treasury officers which use derivatives, such as interest rate swaps, to protect themselves from interest rate changes.

Where it does matter is the effect of changes to the rate of interest that applies to circulating capital, put crudely on the cost of a business’s overdraft. Interest costs on circulating capital in turn determine the marginal returns of production, and therefore set the overall profitability of an enterprise.

Even if a business has no need to borrow, the cost of circulating capital is a measure that a business must pay attention to. If the returns on capital do not clear a hurdle rate based on current interest rates, a business would be better off using its money elsewhere. Central banks understand this, and their holy grail is to detect the rate at which a balance is achieved, and the economy can therefore grow at a sustainable rate. We see this reflected in monetary policy, whereby the FFR is moved up in baby steps, the effect on the economy being assessed after each rise. This point was confirmed by Jay Powell in yesterday’s press conference following the rate decision.

The Fed creates problems for itself

The drawback of state intervention in any field is that unexpected consequences arise as economic actors adjust to the opportunities created. The suppression of interest rates below their natural time-preference value is a transfer of benefit from savers to borrowers, so businesses are encouraged by suppressed borrowing costs to borrow to expand production. This is, of course, the intention behind monetary policy early in the credit cycle. But when the extra demand for capital goods (the goods used to produce final goods and services for consumption) develops, commodity and other intermediate production prices begin to increase reflecting credit expansion, and it is rising prices that always force a central bank to end interest rate suppression.  They have to increase interest rates to a level sufficient to support the currency and contain the price consequences of earlier monetary inflation. Monetary policy targeting a neutral rate has to be put aside.

This is a problem that arises from intervention. If they must intervene to correct the inflationary effects of earlier interventions, central banks would be better more closely monitoring commodity prices and the prices of production rather than relying mainly on consumer prices, because consumer prices are the last to be affected by monetary expansion, except where the stimulus is directly through consumer borrowing. In other words, monitoring prices should be more flexible than it is under current inflation mandates.

Instead, the Fed wants to follow a more objective approach and to do away with as much guesswork as possible. It then falls into the econometric trap of believing there is such a thing as a scientific basis in a general price level. But a wholly artificial index of prices can be constructed to give you any answer you want, particularly through the application of hedonics. This is a fancy term for assuming that if the price of a product rises, you must deflate it for an assessed value of all improvements. This is why for statistical purposes an automobile today costs nearly the same as one thirty years ago, when it actually costs nearly twice as many dollars. Then there is product substitution, where index weightings are adjusted on the assumption that higher prices for one item will encourage some consumers to go for a cheaper alternative. Less steaks and more cheaper chicken breasts. The evidence of price inflation is thereby suppressed to only a few per cent.

Therefore, consumer price indices are now being used to quash the price effects of monetary inflation instead of recording it. It is a short step for the members of a monetary policy committee to move from accepting that these distortions exist and why they should be taken into account when setting rates, to taking doctored inflation statistics at their face value. This is one very good reason why central bankers are blindly unaware of the consequences of earlier interest rate suppressions.

Paradoxically, the best outcome for a central bank is to never achieve the economic revival that is the stated objective of monetary policy, because to do so merely leads to destructively higher interest rates and the termination of the credit cycle. This means that consciously or unconsciously, monetary committees are on the lookout for news that delays the need to raise rates. So, what we have is monetary policy based on misleading statistics that almost guarantees policy makers act like the fabled three wise monkeys, until it is too late.

The consequences of Powell’s partial epiphany

Blindness to the state of the cycle is certainly true of the ECB, Bank of Japan and Bank of England, as well as the majority of central banks suppressing interest rates in minor currencies. It was also true of the Fed, until recently. Chairman Powell now tells us business investment is increasing and the US economy is going like a train (not his actual words). He expects more interest rate increases to come. He is right about where we are in the credit cycle, but wrongly thinks it is a business cycle which will need no more than a neutral rate of interest to keep it under control.

In the world of central banking Powell is now an outlier, and in our globally connected world central bankers abroad who are still suppressing interest rates are now dangerously wrong-footed. There is bound to be an immediate period of painful readjustment. Currency strains and higher interest rates for nearly all other currencies seem set to undermine bond and equity markets, in a text-book run-up to the next global credit crisis.

We have now explained why monetary policy leads periodically to a credit crisis that exposes businesses which are only profitable so long as interest rates are suppressed. This has been a feature of the US economy during the current credit cycle for ten years until now, since the FFR was aggressively reduced following the peak rate of 5.25% in 2006-2007. Since the introduction of near-zero rates in 2008, a widespread belief has taken hold that interest rates will never increase significantly again. Consequently, we can be sure the distortions from interest rate suppression have built up to an extent unseen in the past.

This complacency is why an increase in the FFR into the danger zone should warn us that the crisis stage of the credit cycle approaches. But the only businesses directly affected by the FFR are the commercial banks. In the real world the actual interest rates paid by businesses on their circulating capital is what matters. That rate is set by commercial banks, which take into account lending risks to individual corporate borrowers, as well as their own costs of finance. The hurdle rate for a company is therefore significantly higher than the FFR. Our second chart shows the level set by the commercial banks’ prime lending rate.

Assuming the dotted line predicts the height of the prime rate to trigger a credit crisis, this chart suggests that an average prime lending rate of 6% or more will trigger the next credit crisis, against a current rate of 5%. The rule of thumb relationship with the FFR is FFR plus 3% and implies there is a little more margin in higher interest rates than implied in the earlier chart of the FFR. The merit of this chart is it applies to businesses, while the FFR chart does not, but the message is the same.

An increase in the prime lending rate to the 6% level could easily happen in the coming months. The FOMC statement last night included a forecast for the FFR of an average rate of 3.1% next year, which implies a prime rate of over 6%. There is full employment, not only in the US but in other major economies as well. Commodity prices, notably energy, are rising, and the heavily-sedated CPI-U is at 2.5%, already above the 2% target rate. It is against this background that President Trump is increasing government spending while cutting taxes. Even for Keynesian economists, the combination of monetary and fiscal stimulus may be too much and could already be leading to their feared excess demand. Higher prices and therefore interest rates will surely follow.

However, the path to higher prime rates seems unlikely to be straightforward. In a classically-defined credit cycle its mature phase is likely to see a shift of monetary capital away from financial to commercial activities, from Wall Street to Main Street if you like. We have seen some of this take place, evidenced by rising bond yields, but the quantity of money flowing into bonds continues apace, particularly from foreign sources.

The most notable evidence of a switch in the destiny of capital is likely to come from equity markets, which should turn down as money-flows are diverted into the real economy. But the banks have the reserves to finance both financial market speculation and increased production, at least to a degree. Furthermore, much of the expansion of bank credit is aimed at consumers, financing their demand for goods. Instead of there being a noticeable time lag between a peak in equity markets and an eventual peak in production, the two events could almost be bound up together, with equities falling just ahead of the credit crisis itself.

Rhyming with the past?

In that event, the approaching interest rate cycle peak could contribute directly to the collapse of economic activity through wealth destruction in equity markets as much as through the exposure of malinvestments in production. A credit crisis with these characteristics has much in common with the 1929-32 period.

The 1929 Wall Street Crash came at the end of a similarly extended period of credit expansion, which prolonged the final pre-crash phase of the credit cycle, just as it has today. Consumer price rises were subdued through the introduction of factory production lines for new goods. Today they have been restrained by the expansion of production in cheaper jurisdictions. There can be little doubt there are similarities between that period and conditions today, not least in the optimism over the non-inflationary outlook.

There were also significant differences, the most notable being globalisation was generally restricted to the market for commodities ninety years ago and some limited exporting of capital goods. This time, globalisation extends throughout the production chain from commodities to retail and embraces the coordination of monetary policy by central banks as well.[iii] This means that a crisis on Wall Street, which destroys wealth in America, is likely to spread rapidly to all other major economies. The role of the dollar as the world’s reserve currency is an additional factor binding all nations into the same credit and production cycles.

The onset of the next credit crisis in America could also be triggered from elsewhere, particularly the Eurozone. The ECB is still suppressing interest rates in negative territory and buying government bonds during what is increasingly seen to be the final stages of the Eurozone’s credit cycle, making the inevitable interest rate adjustments that follow potentially very sudden and violent. The situation in Japan is similar, but Japanese manufacturers are now global businesses that just happen to be based in Japan, so are more affected by the dollar and other major currencies.

All central banks are proceeding on the assumption there is no credit crisis on the horizon. This hubris was vividly demonstrated by Janet Yellen who a year ago told us she did not believe there would be another financial crisis in her lifetime, thanks largely to reforms of the banking system since the 2007-09 crash. That crash was a surprise to central bankers then, as was every crash before. Even Benjamin Strong in the late-1920s believed his new Federal Reserve System had tamed the business cycles of the previous century, though he died before being disproved by the 1929 Crash.

Strong’s hubris then was the same Yellen’s hubris last year. Central banks have learned nothing about the credit cycle in nearly a century. If they had, they would be promoting sound money and a hands-off policy, while ensuring commercial banks restrict their credit expansion. They would let malinvestments wash out of the system, not build up for one huge crisis. They are not even aware, it seems, that they are living dangerously as they raise interest rates into and beyond the zone that will trigger the next credit crisis.

A credit crisis today will be more catastrophic than that of ten years ago. And when the crisis comes, the response is always the same, except the quantities involved are far greater. The banks will be rescued by the Fed printing new capital for them without limitation, on condition they don’t foreclose on their customers. The Fed will take bad and doubtful debts off the banks at the same time. Government borrowing will rocket, reflecting increasing social liabilities and falling tax revenues. All the money required will be created out of thin air.

The great financial crisis of 2007/08 will be eclipsed. In a nutshell, this time the quantity of new money required will likely lead to the destruction of the “full faith and credit” in the currencies themselves, which until now has been broadly unquestioned by ordinary members of the public.

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Russian Hedge Fund Manager Disappears With $250 Million Of Client Money

We have seen this story play out before.

Russian fund manager and entrepreneur, German Lillevyali, who is – or was – President of GL Financial Group, a Swiss- and U.K.-licensed asset manager with branches in Moscow, Zurich, Geneva, London, Cyprus, and Belize, has disappeared without a trace. The professional investors who according to Bloomberg had $250 million under management at the end of last fiscal year, may have disappeared to Cyprus or some other Russia-friendly jurisdiction.

German Lillevyali

A recent Facebook post under the name of “German Lillevyali” attempted to soothe a group of investors who had concerns about GL Financial Group’s solvency.

“I promise you the money is safe,” it said. “I will return it personally, there is nothing to worry about. Please send me a personal message if you want more information,” the Facebook post read.

The flagship company of the group is GL Asset Management. It appears that Lillevyali lured in investors with promises of high returns and a fancy description of his “market-neutral” fund — deploying “state-of-the-art mathematical models and algorithms” to trade international equity markets. In other words, someone who pretended to be a quant but wasn’t.

“GL Asset Management specialises in market-neutral investing and are known for a precise and rigorous approach to developing and managing innovative investment strategies. By deploying state-of-the-art mathematical models and algorithms, combined with active management, we offer our clients the opportunity to invest in liquid, equity-trading portfolios that are designed to grow and preserve their wealth while minimizing risk,” the ‘About us’ section on LinkedIn read.

The goal of the fund was “to grow and preserve their [investors] wealth while minimizing risk,” however, today the case is precisely the opposite.

According to Bloomberg, GL Financial investors around the globe are trying to redeem their money even as GL employees resign en masse. The company’s website domain has been shut down, offices closed, and even phone lines have gone dead. Some of the disgruntled clients include an executive who works for billionaire Oleg Deripaska, high ranking managers at Swiss drugmaker Novartis AG, San Francisco-based Levi Strauss & Co., and even FIFA soccer stars.

Bloomberg documents the story of GL Financial’s unraveling, which is now being heavily scrutinized by European regulators:

“Regulators in Britain and Switzerland, has been pieced together from interviews with eight clients and former employees. They requested anonymity either because they don’t want to jeopardize efforts to retrieve their savings or because they fear for their physical safety.

Calls and messages to the numbers listed for GL Financial and related companies weren’t returned or went to voicemail. When Bloomberg reached Lillevyali himself via WhatsApp on Wednesday and Thursday, he declined to identify his current location three times, saying he’s not ready to play “the anti-hero.”

Lillevyali rejected any suggestion that he lost or is withholding client funds. He said the most he ever had under management was about $140 million and that about $35 million belonging to about 30 people is now frozen, mainly due to “compliance issues” related to sanctions. U.S. and European sanctions only apply to a few dozen Russians, none of whom are known clients. He said “a large number” of customers are getting repaid, though he did not name any.

“It’s like a bad movie,” said one customer angry at what he described as being stonewalled for months.”

In a Twitter post from February 09, under the Twitter handle “German Lillevyali” (unconfirmed by Twitter’s employees), Lillevyali boasted about his chess playing abilities and how he recently defeated former Russian chess grandmaster and world champion Anatoly Karpov. Karpov’s assistant in Moscow told Bloomberg she could not confirm or deny that claim.

More recently, he was interested in the amount of negative-yielding debt

Former-employees of GL told Bloomberg that they didn’t know when they were partying on the 62nd floor of the Federation Tower in December “that months earlier Lillevyali had exited the ownership structure of his main Russian vehicle for attracting clients, Ankor Invest,” which was confirmed via regulatory filings.

Then in March, Russia’s central bank terminated Ankor’s license for “numerous” violations of securities law it did not identify. Lillevyali said Ankor Investment’s primary violation was that most assets under management were held outside of Russia, mainly in Europe. The Russian Central Bank has given Lillevyali to the end of June to halt operations.

Bloomberg adds that Swiss financial watchdog Finma and Britain’s Financial Conduct Authority have been asked to investigate GL, but by now it’s surely too late.

“An American client who worked in Russia from 2014 to 2017 and is now based in Switzerland said Ankor’s demise came as a surprise because he’d seen steady returns of about 7 percent a year—at least on paper—since a relationship manager at the firm first reached out to him via LinkedIn in 2015.

Like other clients, he said he was impressed that GL’s web of affiliates seemed to have well-established operations in Switzerland. He said an executive in the Zurich office held a video conference with him and the firm’s representatives in Russia had Swiss mobile numbers and addresses on their business cards.

He invested $100,000 the first year then another $100,000 in each of the following two years, money he said he was saving for a house and his children’s education. The company was attentive and sent him annual gifts, first a bronze statue and then an expensive calligraphy set. After Ankor was blacklisted, he said a sympathetic employee in Moscow urged him to withdraw his funds, but he couldn’t get anyone from Zurich on the phone. When he finally got through, he said he was told his money was “stuck in the bank” and he hasn’t been able to reach anyone since.”

Another disgruntled client told Bloomberg that his GL account manager told him to redeem his funds because of the uncertainties that started to swirl around the company in late 2017. The company told the client in early 2018 that his funds would be wired to him within 15-days. The money never came. Why was the client gullible enough to watch hundreds of thousands of his hard earned money vaporize? Because he thought the fraudulent investors had a “veneer of Swiss respectability.”

“A disgruntled German client said GL’s veneer of Swiss respectability won him over, too. After a broker he trusted recommended the firm in late 2016, he decided to invest an initial $250,000. He balked when he was told his money would be routed to Belize, but went ahead after receiving a letter signed by Lillevyali himself reiterating that he’d be able to withdraw his funds at will.

By last December, as Lillevyali was preparing for his party at Sixty, the German client said an account manager in Zurich urged him to redeem his funds because things were starting to look “shaky.” When he tried, he said he was told there’d be a delay due to his U.S. citizenship, which he doesn’t have

Months later, he said he got an email from the Belize affiliate, Financial Alliance Ltd., saying his money would be wired within 15 days. He’s still waiting. A Dutchman seeking to reclaim $500,000 told a similar tale.”

The closed doorway to GL Med, an anti-aging clinic in Moscow

Dmitry Pronyushkin, a client who is suing Ankor, said he constructed a website to warn people about Lillevyali, but nobody believed him until it was too late? Why? Because it appears that most rich people are gullible idiots:

“They had the facade of a decent company, the Swiss offices, that’s why so many decent people believed them,” he said.

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America Loses When The Trade War Becomes A Currency War

Authored by Brandon Smith via Alt-Market.com,

There has been a longstanding narrative in economic circles that no matter what crisis occurs the U.S. dollar is essentially invincible. 

I have never been one to buy into this assumption.

Reason 1: Because I remember distinctly just before the derivatives and credit crisis in 2007/2008 the majority of mainstream economists were so certain that U.S. housing and debt markets were invincible, and they were terribly wrong. Whenever the mainstream financial media are confident of an outcome, expect the opposite to happen.

Reason 2: Because karma has a way of crushing grand illusions. When you proudly declare a Titanic “unsinkable,” nature or fate often tests that resolve and finds it wanting.

Reason 3: Because I understand that a primary goal of the internationalist, globalist, anti-sovereignty and New World Order crowd is to diminish U.S. economic performance dramatically, and this includes ending the reserve status and petro-status of the dollar in order to make way for a single global currency unit dictated by a single global economic administrator.

Mindless blind faith in the dollar (and U.S. treasury debt) seems to switch sides politically according to whose narrative it best suits.

During the Obama administration, conservatives and Republicans witnessed unprecedented fiat currency creation and dollar devaluation by the Federal Reserve and rightly drew the conclusion that this would eventually trigger a currency crisis as various systems absorb and then regurgitate all these dollars back into the U.S. We saw the biggest foreign trading partners of the U.S. launching bilateral trade agreements that cut out the dollar as the reserve currency, and we witnessed many foreign creditors questioning the viability of U.S. debt.

Only a couple of years ago, conservatives were warning of potential disaster for the dollar caused by the bailouts and unchecked stimulus programs while leftists were staunchly defending the dollar as an immortal golden goose. Today, the roles appear to be switching, as many conservatives now defend “king dollar” in the wake of a Trump presidency, and adopt numerous arguments once reserved for ignorant lefty commentators.

One question that needs to be addressed is how long the current trade war will last? Some people claim that economic hostilities will be short-lived, that foreign trading partners will quickly capitulate to the Trump administration’s demands and that any retaliation against tariffs will be meager and inconsequential. If this is the case and the trade war moves quickly, then I would agree — very little damage will be done to the U.S. economy beyond what has already been done by the Federal Reserve.

However, what if it doesn’t end quickly? What if the trade war drags on for the rest of Trump’s first term? What if it bleeds over into a second term or into the regime of a new president in 2020? This is exactly what I expect to happen, and the reason why I predict this will be the case rests on the opportunities such a drawn out trade war will provide for the globalists.

In my article World War III Will Be An Economic War, I reiterated my longstanding view that there is indeed a global war brewing between major powers, but that this war will be fought primarily with financial weapons, not nukes. I also summarized my position that this war will be engineered by globalists deliberately to provide cover for something they call the “great economic reset.”

With Trump’s cabinet currently loaded with banking elites and neoconservatives with ties to institutions like Goldman Sachs and the Council On Foreign Relations, institutions notorious for promoting one-world economic and political programs, it seems to me that the worst case scenario for the U.S. could easily be staged. If the goal is to kill the dollar’s reserve status, then the trade war will be purposely prolonged.

The next question that needs to be addressed is how is the dollar actually vulnerable to destabilization?

Pro-dollar cheerleaders will say that the dollar is in high demand, with countries like India begging the Fed to stop balance sheet cuts for fear that this will reduce the amount of dollars and dollar denominated assets in circulation in emerging markets.

I see this as a gross misinterpretation of what India and others are warning about. Interestingly, foreign central banks are now sounding an alarm many of us in the alternative economic field have been sounding for years. When India’s Reserve Bank Governor, Urjit Patel, writes about the danger of speedy balance sheet cuts by the Fed causing a liquidity crisis in global markets, this is not necessarily a declaration that India has a insatiable desire for more dollars. What it is a declaration of is the fact that the global economy is weakened by its dependency on the dollar as the primary international trade mechanism.

When I see India complaining about the frailties in dollar liquidity caused by Fed balance sheet reductions, I don’t interpret that as them saying “go king dollar!” I interpret that as India coming to the realization that they are going to have to adopt other alternatives to the dollar, and they are going to have to do this quickly.

Emerging markets and much of the world have been propped up for the better part of a decade through Federal Reserve stimulus measures, from direct bailouts to near zero interest rate loans to asset purchases to outright stock market manipulation. The dollar has become a drug easing the pain of economic downturn, and many nations are addicted.

So what happens when the drug dealer, for whatever reason, suddenly stops providing the drug? The addict is going to look elsewhere for a fix.

The Fed is NOT going to stop its balance sheet cuts, and it’s not going to stop interest rate hikes. Not with the current discussion on “inflation dangers.” This will ultimately cause declines in various markets including equities, and I believe these declines will accelerate by the end of 2018. Meaning, liquidity in foreign trade and markets will have to be facilitated by other sources, such as the International Monetary Fund’s (IMF) basket currency system, or the application of a new global cryptocurrency system, which the IMF has been avidly studying.

The IMF has even been singing the praises of cryptocurrencies recently, even depicting them as the next stage in human evolution and perpetuation the lie that cyrpto is “anonymous.”

The dollar is vulnerable to destabilization by the very institutions and elitists that created it in the first place, and these people are seeking something much bigger than king dollar. The problem is, the globalists cannot implement such a vast ‘reset’ in the economy without a considerable distraction. Enter Trump’s trade war…

I have been outlining the reality behind dollar weakness for quite some time. Rehashing the facts over and over again becomes tiresome but is unfortunately necessary, because there is always some new contingent of the public that falls into the trap of dollar worship. So, let’s do this one more time.

First, the dollar is NOT backed by U.S. military might. The U.S. military can barely manage its concerns in the Middle East, let alone take on nations like Russia or China in an attempt to force them to keep investing in U.S. treasury debt or retain the dollar as world reserve. If these countries drop the dollar, there is nothing the U.S. can do. Anyone who makes the dollar-by-military argument should not be taken seriously.

Second, while the dollar is in demand now, this is only because the current system has been propped up by endless Federal Reserve stimulus.  If the Fed continues to cut assets and raise interest rates, then emerging markets and others will look elsewhere for support. The dollar is only valuable to global markets so long as the Fed continues to provide a perpetual supply of liquidity. Economies are fickle, and welfare recipients are even more so. Stop giving people free goodies and they will abandon you angrily.

Major foreign economies like China and parts of Europe have been adopting bilateral trade relations for some time. Rather than intimidating these countries into capitulation, a trade war on the part of the U.S. is far more likely to drive them more closely together. Germany and China in particular have been establishing strong trade ties, and OPEC nations have been much cozier with the East. The idea that the U.S. is somehow a linchpin to the entire global economy is a lie. The world can and will organize trade avenues without us if pushed. In fact, this seems to be the plan.

The U.S. has only two major points of leverage in a trade war.

  • First, the U.S. dollar’s world reserve status, which I have already addressed as not a point of leverage at all unless the Fed continues stimulus indefinitely.

  • Second, the U.S. consumer.

U.S. consumers and corporate buyers are sitting at historically high debt levels. In fact, their debt levels are higher than they were just before the crash of 2008. As the Fed continues to raise interest rates, this debt will become unsustainable and something will have to give. For corporations, this means job cuts and wage reductions. For consumers this means cuts to household spending. U.S. consumers are only a point of leverage in a trade war so long as they continue to consume at ever expanding rates. If we suffer another crash similar to 2008, foreign creditors will see this as a lack of incentive to continue placating the U.S.

Without a massive resurrection of American manufacturing and production, we enter into a trade war with little ammunition because we remain dependent on foreign production and goods, while other nations like China can easily expand into alternative markets and retain their own production capabilities. Trump could have launched a new renaissance of production in the U.S. if he had given corporations incentive to bring manufacturing back home. Instead, he gave them a sizeable tax cut without asking for anything in return. Those tax cuts, instead of creating jobs or luring factories back to the U.S., have instead been spent where we all knew they would be spent — on stock buybacks to prop up a flailing equities market.

The longer the trade war continues, the more other countries will consider the “nuclear option” of dumping the dollar as world reserve, or dumping U.S. debt. In my view, this is exactly what the globalists want. Trump bumbles into a trade war and is blamed for a crisis in the dollar as well as a crash in stock markets, while the banking elites introduce their new world order reset as a solution. In this case, I think the worst case scenario is the intended scenario.

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Don’t Have Sex With Foreigners During The World Cup: Russian MP

A member of Russian parliament said that women should avoid “intimate relations” with foreigners during the World Cup, reports The Telegraph, amid reports that over 1 million international tourists are expected. 

Tamara Pletnyova, head of Russia’s family, women and children’s affairs committee, suggested that even if these relationships lead to marriage – the men will just take the women and/or their children out of the country.

“Even if they get married, they’ll take them away, then she doesn’t know how to get back,” said Pletnyova on Russian radio station Govorit Moskva. “Then they come to me in the committee, girls crying that their baby was taken away, was taken, and so on.”

“I’d like people in our country to marry for love, no matter what nationality as long as they are Russian citizens who will build a family, live peacefully, have children and raise them.”

Pletnyova noted that many women who “welcomed” foreigners during the 1980 Olympics in Moscow “suffered” as single mothers. There were so many of these babies that biracial Russians used to be referred to as “children of the Olympics” or “festival children” after the massive international festivals which the Sovient Union used to host with African, Middle Eastern and South American participants. 

It’s good if it’s one race, but if it’s another race, then they really did. We should have our own babies,” Ms Pletnyova said. 

Russian soccer clubs have been sanctioned for racist fan behavior in the past – with the Fare network and SOVA Centre recording “19 discriminatory chants,” which included monkey sounds and neo-Nazi songs, during the 2017-2018 season. 

That’s nothing, check out this Chinese laundry commercial… 

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Turley: “Comey Can No Longer Hide Destruction Caused At FBI”

Authored by Jonathan Turley, op-ed via TheHill.com,

James Comey once described his position in the Clinton investigation as being the victim of a “500-year flood.” The point of the analogy was that he was unwittingly carried away by events rather than directly causing much of the damage to the FBI. His “500-year flood” just collided with the 500-page report of the Justice Department inspector general (IG) Michael Horowitz. The IG sinks Comey’s narrative with a finding that he “deviated” from Justice Department rules and acted in open insubordination.

Rather than portraying Comey as carried away by his biblical flood, the report finds that he was the destructive force behind the controversy. The import of the report can be summed up in Comeyesque terms as the distinction between flotsam and jetsam. Comey portrayed the broken rules as mere flotsam, or debris that floats away after a shipwreck. The IG report suggests that this was really a case of jetsam, or rules intentionally tossed over the side by Comey to lighten his load. Comey’s jetsam included rules protecting the integrity and professionalism of his agency, as represented by his public comments on the Clinton investigation.

The IG report concludes, “While we did not find that these decisions were the result of political bias on Comey’s part, we nevertheless concluded that by departing so clearly and dramatically from FBI and department norms, the decisions negatively impacted the perception of the FBI and the department as fair administrators of justice.”

The report will leave many unsatisfied and undeterred. Comey went from a persona non grata to a patron saint for many Clinton supporters. Comey, who has made millions of dollars with a tell-all book portraying himself as the paragon of “ethical leadership,” continues to maintain that he would take precisely the same actions again.

Ironically, Comey, fired FBI deputy director Andrew McCabe, former FBI agent Peter Strzok and others, by their actions, just made it more difficult for special counsel Robert Mueller to prosecute Trump for obstruction. There is now a comprehensive conclusion by career investigators that Comey violated core agency rules and undermined the integrity of the FBI. In other words, there was ample reason to fire James Comey.

Had Trump fired Comey immediately upon taking office, there would be little question about his conduct warranting such termination. Instead, Trump waited to fire him and proceeded to make damaging statements about how the Russian investigation was on his mind at the time, as well as telling Russian diplomats the day after that the firing took “pressure off” him. Nevertheless, Mueller will have to acknowledge that there were solid, if not overwhelming, grounds to fire Comey.

To use the Comey firing now in an obstruction case, Mueller will have to assume that the firing of an “insubordinate” official was done for the wrong reason. Horowitz faced precisely this same problem in his review and refused to make such assumptions about Comey and others. The IG report found additional emails showing a political bias against Trump and again featuring the relationship of Strzok and former FBI attorney Lisa Page. In one exchange, Page again sought reassurance from Strzok, who was a critical player in the investigations of both Hillary Clinton and Donald Trump, that Trump is “not ever going to become president, right? Right?!” Strzok responded, “No. No he won’t. We’ll stop it.”

The IG noted that some of these shocking emails occurred at that point in October 2016 when the FBI was dragging its feet on the Clinton email investigation and Strzok was a critical player in that investigation. The IG concluded that bias was reflected in that part of the investigation with regard to Strzok and his role. Notably, the IG was in the same position as Mueller: The IG admits that the Strzok-Page emails “potentially indicated or created the appearance that investigative decisions were impacted by bias or improper considerations.” This includes the decision by Strzok to prioritize the Russian investigation over the Clinton investigation. The IG states that “[w]e concluded that we did not have confidence that this decision by Strzok was free from bias.”

However, rather than assume motivations, the IG concluded that it could not “find documentary or testimonial evidence that improper considerations, including political bias, directly affected the specific investigative decisions.” Thus, there was bias reflected in the statements of key investigatory figures like Strzok but there were also objective alternative reasons for the actions taken by the FBI. That is precisely the argument of Trump on the Comey firing. While he may have harbored animus toward Comey or made disconcerting statements, the act of firing Comey can be justified on Comey’s own misconduct as opposed to assumptions about his motives.

Many of us who have criticized Comey in the past, including former Republican and Democratic Justice Department officials, have not alleged a political bias. As noted by the IG report, Comey’s actions did not benefit the FBI or Justice Department but, rather, caused untold harm to those institutions. The actions benefited Comey as he tried to lighten his load in heading into a new administration. It was the same motive that led Comey to improperly remove FBI memos and then leak information to the media after he was fired by Trump. It was jetsam thrown overboard intentionally by Comey to save himself, not his agency.

The Horowitz report is characteristically balanced. It finds evidence of political bias among key FBI officials against Trump and criticizes officials in giving the investigation of Trump priority over the investigation of Clinton. However, it could not find conclusive evidence that such political bias was the sole reason for the actions taken in the investigation. The question is whether those supporting the inspector general in reaching such conclusions would support the same approach by the special counsel when the subject is not Comey but Trump.

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Chinese Warn Of “Immediate” Retaliation As Trump Readies $50 Billion Tariff Package

Just hours after President Trump reportedly signed off on tariffs targeting some $50 billion in Chinese goods (a decision that was finalized after a 90-minute meeting with officials from the West Wing, as well as senior national-security officials, the Treasury Department, the Commerce Department and the office of the US Trade Representative), Chinese Foreign Minister Wang Yi said during a press conference in Beijing that China is prepared to retaliate as it takes a more confrontational approach against the US on trade, according to the Wall Street Journal.

China

Wang’s comments reportedly followed face-to-face talks with Secretary of State Mike Pompeo, where Wang urged Pompeo to choose a path of “cooperation and mutual benefit.” Pompeo was in Beijing to brief Chinese officials on the North Korea summit.

On Thursday, Chinese Foreign Minister Wang Yi said China and the U.S. faced a choice between cooperation and mutual benefit on the one side and confrontation and mutual loss on the other.

“China chooses the first,” Mr. Wang told a joint news conference, after talks with U.S. Secretary of State Mike Pompeo in Beijing.

“We hope the U.S. side can also make the same wise choice,” Mr. Wang said. “Of course, we have also made preparations to respond to the second kind of choice.”

Meanwhile, Bloomberg reports that Mei Xinyu, a researcher at Chinese Academy of International Trade and Economic Cooperation, part of China’s Ministry of Commerce, expects China to adopt retaliatory tariffs on U.S. goods “immediately.”

While the official breakdown of Trump’s tariffs won’t be released until tomorrow, a CNBC source noted that Trump has already signed off on the tariffs, and that a list of talking points has been distributed to 10 government agencies, while a list of products has been uploaded to a government database.

As we noted earlier, one factor that could sway Trump’s thinking on tariffs would be an aggressive response from China. Earlier on Thursday, Xinhua, China’s state news agency reported that President Xi Jinping had told Pompeo that he hopes the US will tread carefully when it comes to sensitive issues like the US’s relationship with Taiwan and the simmering trade conflict so as to avoid a serious breakdown in bilateral ties between the two countries (ties that, aside from the trade spat, are also being tested by military brinksmanship in the Pacific).

The list of goods that will be subject to the new levies is expected to include between 800 and 900 products, slightly less than the original list of about 1,300 products on a list published by the US Trade Representative in April, as we pointed out earlier, While the two countries have been exchanging trade-related threats for months now, it’s still unclear when the US tariffs will go into effect.

But remember, this is not a ‘Trade War’ – heaven forbid… the narrative that these shots and retaliations are merely skirmishes (because what would stocks do if they really started thinking a trade war was possible). One can’t help but picture the Black Knight defending his bridge…one “fleshwound” at a time…

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Lawyer Could Seize Daniels’ $600,000 Crowdfunding Stash In Dispute With Avenatti

As it turns out, lawyer Michael Avenatti’s legal problems are becoming Stormy Daniels’ problems, too.

As the Los Angeles Times reports, an Orange County lawyer has asked a bankruptcy court to seize most of the $577,000 that was raised by Daniels during a kickstarter campaign to finance her lawsuit against President Trump. The lawyer, Jason Frank, is trying to collect on a $10 million judgment he won last month against Eagan Avenatti, the Newport Beach firm belonging to Daniels’ attorney, Michael Avenatti. Daniels is famously suing Trump to be let go from a 2016 NDA she signed to not disclose details about an affair she purportedly had with the president a decade ago.

Daniels

The debt to Frank was one of the biggest the firm promised to pay when it emerged early this year from Chapter 11 bankruptcy protection. Frank worked at the firm between 2009 and 2016, and says it cheated him out of millions of dollars of pay. Frank won his judgment after the firm broke a promise to pay him nearly $5 million that was supposedly personally guaranteed by Avenatti.

Of course, Avenatti denies that the court has any standing to collect Daniels’ money. That’s because, he says, Daniels is represented by a totally different firm – called Avenatti & Associates. Apparently, the fact that he no longer works at Eagan Avenatti hasn’t stopped Avenatti from using an Eagan Avenatti email address or from copying Eagan Avenatti office manager Judy Regnier. Avenatti also used his title at the firm in his signature block, which also listed him as a partner at Eagan Avenatti.

Still, Avenatti insists they’re separate firms and that Daniels was never represented by Eagan Avenatti.

“A signature block means nothing,” Avenatti said by email, “and you have no evidence the firm ever represented Ms. Clifford.”

In an amusing twist, corporate papers filed with California’s secretary of state show that Avenatti & Associates, a firm wholly owned by Avenatti, lists its type of business simply as “Eagan Avenatti”. That’s probably because Avenatti & Associates owns 75% of Eagan Avenatti. San Francisco lawyer Michael Eagan owns the remainder of the firm.

Regardless of whether Daniels money will also be taken, the bankruptcy clerk last week directed the US Marshals Service to enforce Frank’s judgement, which could soon lead to Eagan Avenatti’s assets being seized.

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