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It turns out that it is not just analysts that Elon Musk likes hanging up on. As Tesla news over the course of the last week has been solely about Musk’s bizarre behavior on the company‘s most recent conference call (and ensuing Tweets), another interesting nugget slipped its way into the media Friday that was overlooked: Musk also apparently hung up on the NTSB back in April.

Bloomberg reported on Friday, May 4:

Elon Musk, the feisty leader of an empire to build new-age cars and rockets whose dismissive call this week with financial analysts has drawn controversy, last month hung up on the top U.S. transportation accident investigator.

Robert Sumwalt, the chairman of the National Transportation Safety Board, held a phone call with Musk on April 11 to tell him that blog posts by Tesla Inc. casting blame on the driver of a Model X for a fatal California crash had gone too far. The NTSB had earlier warned Tesla not to make statements about the accident while it was being investigated by the board.

Sumwalt then said he was taking the unusual step of kicking the company’s representatives off the investigation.

“Best I remember, he hung up on us,” Sumwalt told attendees of the International Society of Air Safety Investigators’ Mid-Atlantic Regional Chapter dinner Thursday. It was his first public comments on the exchange.

One would think that alienating the regulator that may hold the company’s future in its hands is arguably just as much of a transgression as calling conference call analysts “boring”, “dry” and “boneheads”.

But now, in the dance that the company has done over the last month to try and put a spin on the NTSB investigation news (of the NTSB dropping Tesla from the investigation and not the other way around), we found out the truth from the source directly. Bloomberg continued:

In the speech, Sumwalt had been discussing the NTSB’s long-time practice of enlisting companies and other government agencies to assist its investigations and praised the cooperation it received from Southwest Airlines Co. following an engine failure that killed a passenger on April 17.

After the conversation between Sumwalt and Musk, the company took the initiative and issued a statement saying it “withdrew” from the probe. Only later on April 12 did the NTSB issue a release saying it had actually removed the car manufacturer.

The NTSB is looking at why the battery on the Model X caught fire after the car struck a highway barrier in Mountain View, California, on March 23. After NTSB opened the investigation, Tesla announced that the car was being guided by the semi-autonomous driving feature known as Autopilot and the driver’s hands hadn’t been detected on the wheel for six seconds. NTSB then expanded the probe to look at the autonomous driving issues.

The Bloomberg article concluded:

The NTSB, which is also investigating a January Tesla crash near Los Angeles, hasn’t released a preliminary report yet on the Mountain View crash.

After its removal, Tesla accused NTSB of being “more concerned with press headlines than actually promoting safety” and defended its right to warn other drivers to remain engaged while using Autopilot. The company didn’t immediately respond to a request for comment on Sumwalt’s latest speech.

All of this comes on top of a distressing last month and a half for Tesla, which has seen mainstream media confidence in the name slip and has obviously found the company’s CEO under significant amounts of stress and pressure. We commented on Friday morning about a new recent tweet storm that Musk put up to address his antics from the most recent conference call.

Elon Musk’s bizarre Wednesday meltdown, when during the conference call he cut off analysts from Bernstein and RBC simply for asking “boring, boneheaded” questions, continued Friday on Twitter, when he personally attacked Bernstein’s Toni Sacconaghi and RBC’s Joe Spak, accusing them of “trying to justify their Tesla short thesis” and working against the interest of (bullish) investors.

Some blame “Russians” when things don’t go their way, others find blame with “sell-side” analysts who are “trying to justify their Tesla short thesis.” And for the record, Tesla fell 5.6% to close Thursday at $284.45, just above Sacconaghi’s $265 price target and almost in line with Spak’s, who sees the shares falling to $280.

Of course, Musk’s latest display of petulant anger, which naturally spares such analysts as Morgan Stanley’s Adam Jonas who have idiotically high price targets, merely indicates that Musk has no idea how this works at all: sellside analysts don’t do anything to justify a thesis, whether long or short, that’s what buyside analysts are for; what the sellside does is serve as conduits to arrange management meetings.

And in the case of RBC and Bernstein, they clearly won’t be doing that any time soon – and certainly won’t be invited to participate in any upcoming Tesla stock offering – so at least their analysis is credible, which may be what most angered Musk.

Actually, no, what infuriated Musk is that Tesla shares had their biggest drop in more than a month on Thursday after the earnings call, in which Musk said the questions “are so dry,” and turned instead to one from a channel on the YouTube video-streaming service; he also urged ‘daytrading’ retail investors to sell the stock if they don’t believe the long-term vision of the company.

On Thursday, the day after the conference call, Tesla shares fell from post-result highs of about $310 to about $285 – but rebounded on a squeeze Friday, set to close around $295.

via RSS https://ift.tt/2rpeOvE Tyler Durden

Authored by Kevin Muir via The Macro Tourist blog,

Many gold bulls are frustrated that during last year’s U.S. dollar decline, the precious metal didn’t rally more strongly.

After all, the U.S. dollar had a terrible 2017.

One might assume that this would have been an ideal environment for gold. I have even heard the argument that since gold couldn’t rally more strongly during this period, when the U.S. dollar eventually stops declining, gold will be vulnerable to a big sell off. The logic being that if that’s the best gold can do in a U.S. dollar bear market, it will get crushed in a U.S. dollar bull market.

I like to think about this scenario a little differently.

While most gold bulls are disappointed by the inability of gold to break out, I am heartened by the fact that even with the massive increase in real yields, gold managed to eke out some decent gains.

Most market pundits believe the U.S. dollar is the most important determinant when it comes the gold price. It’s easy to see why. Take a gander at this chart of gold versus the inverted U.S. dollar index:

It sure appears as if gold is merely the inverse of the US dollar index.

Yet I beg to differ. Let’s back up the time frame and look at this chart from a longer term perspective.

Although over the past few years gold has been negatively correlated to the US dollar, during the 2013-14 period, gold plunged $500 while the US dollar was also declining.

Well, you are probably saying to yourself, “it might not be perfect, but it sure seems to track the majority of time – and especially lately.” Yup – can’t say I disagree.

But what if I told you there was an even better asset that explained gold’s movement better? One that even stayed correlated to gold during the 2013-14 plunge?

Have a look at the price of gold versus the inverted US 5-year TIPS yield (the real yield):

This makes intuitive sense. Gold is an asset that is no one’s liability, but has no yield. In an environment of minuscule real yields, the opportunity cost of holding gold is low, so it is bid up. When central bankers increase the real rate of interest, this cost increases, and gold is replaced with income-earning fiat.

But the sharp-eyed reader will notice something ominous about that chart. Over the past half-year, US 5-year real yields have spiked to new highs (new lows on the chart).

Here is the same chart with a shorter time frame:

So that begs the question – what is driving gold more at this point of the cycle? Is it the US dollar, or real yields? Has gold disappointedly not risen as high as the bulls would like given the US dollar weakness? Or has gold not declined nearly as much as the bears would have expected given the run-up in real yields?

I am not sure. Given the massive one-sided nature of sentiment against fixed-income (everyone is short), it wouldn’t surprise me to get a vicious trading rally in bonds in the near future. Yet will that cause gold to rally? Or will that just bring yields back in line with the fact that gold has not declined as much as would be expected? And what will the US dollar do in this environment? Logic would dictate it should decline (lower yields), but the higher yields of the past half-year has not stopped a brutal US dollar bear market, so maybe the US dollar is not trading on interest rate differentials at all.

It is an interesting time for gold, the US dollar, and rates.

I don’t have many answers, only observations about some of the relationships that are breaking down.

And in another one-of-these-things-is-not-like-the-others moment, the chart of the copper/gold ratio versus the yield on the US 10-year treasury note has also diverged.

Gun-to-my-head it feels like the back-up in yields has gotten ahead of itself, but there are certainly plenty of interesting divergences.

But most of all be careful with the idea that gold is performing poorly given the US dollar decline. I am much more partial to the theory it is performing extraordinarily well given the rise in yields.

via RSS https://ift.tt/2FP4uCI Tyler Durden

There’s good, not so good and bad news in the latest ECB stress test of Greek banks.

The good news when it comes to banks in Greece – the same banks that 3 years ago were on the verge of default, and only draconian capital controls and a tactical ECB backstop which also took the nation hostage as it threatened to break away from the Euro prevented a terminal bank run – is that they have emerged unscathed following the European Central Bank’s latest stress test, giving European bureaucrats one less worry as they plan for the end of the nation’s latest bailout in August.

* * *

The not so good news is that, as Goldman admitted, the entire thing was a farce to begin with, or rather more of a farce than usual. First, the test was much less severe than the scenario modeled by the ECB in its 2015 stress test of the Greek banking system, which assumed the economy shrank as much as 3.9% in a single year. This time around, the worst GDP drop was -2.1% for 2019. This is what Goldman’s Pawel Dziedzic wrote two days ago previewing the stress test outcome: “Stress test assumptions seem milder compared with past reviews, thus reducing the risk of a disproportionately demanding adverse case scenario. The approach is underpinned by the improving macro outlook and the ‘precautionary’ nature of previous exercises.” Of course, the only reason the outlook is improving is thanks to 3 years of ECB QE, which has collapsed European bond spreads to record levels, and which as BofA showed yesterday, is starting to lose control as markets begin to price in the tapering of the ECB’s QE.

Furthermore, there was no pass or fail level in the exercise and the ECB said any recapitalisation decision would be “taken on a case-by-case basis, after assessing each bank’s situation in the light of the results of the stress test and any other relevant supervisory information.” In other words, the whole point of the confidence-building exercise was the pass every participant, not risk failing even one.

* * *

The bad news is that in even the “Adverse” (i.e. mildly-stressed) scenario laid out below…

… Greece’s four biggest banks would take a €15.5BN hit to their combined capital ratios. Furthermore, under the rules of the ECB’s far more draconian 2015 stress tests, which required banks to maintain a CET1 ratio at least 8% in the adverse scenario, three of the four banks would have failed the latest exercise: Piraeus, National Bank of Greece and Eurobank. On the other hand, the stress test was gamed so carefully, that even this “adverse scenario” would leave the banks’ common equity tier one ratio above the unofficial 5.5% hurdle rate used by the ECB in recent years.

Another chart from Goldman showed the alleged improvement in the Greek banks’ CET1 ratio since the collapse days of 2015. Ironically, since then, virtually nothing has changed, and yet the banks are somehow “perceived” as much stronger.

So, as a result of Piraeus Bank, National Bank of Greece, Alpha Bank and Eurobank Ergasias all “passing” the stress test, it means that almost €20 billion set aside to shore up the lenders is now free for other purposes, such as repurchasing debt from the IMF or ECB. What will most likely happen is that the fund will mysteriously be syphoned off by the Greek political oligarchy into various offshore accounts or cryptos, and squandered otherwise just as efficiently.

* * *

Senior Greek officials were naturally delighted by the results, and quoted by the FT said the outcome of the exercise meant there was “no immediate need for a capital increase by any bank”. However, one official said that while the banks were out of immediate danger they still needed to clean up their balance sheets and several were likely to raise capital soon — notably Piraeus Bank, which emerged as a laggard in the tests.

“The stress test have gone as well as we could expect,” said one official, adding that they would ease Greece’s return to borrowing on international markets. He is right: perhaps Greece should go ahead and issue a 100 year bond next, since idiots managing other people’s money have clearly not learned anything from the recent Argentina fiasco.

* * *

Looking at Greek banks on a case by case basis, Alpha Bank performed the best as its CET1 ratio declined from 18.25% at the end of 2017 to 9.69% at the end of 2020 in the adverse scenario. Demetrios Mantzounis, Alpha Bank’s chief executive, said the result “demonstrates the strength of our capital base”.

Piraeus Bank was the worst performer, as its CET1 ratio declined from 14.85% to 5.89% in the adverse scenario. Christos Megalou, chief executive of Piraeus, said the results “confirm that the market environment in Greece is tangibly improving,” adding that he was committed “to further strengthen Piraeus’ financial position”. According to the FT, Piraeus is expected to give more detail on its “capital strengthening plan”, including potential subordinated debt issuance and asset sales, when it reports quarterly results on Thursday.

It is only in recent months that Greek banks – backstopped by the ECB for years – have started taking balance sheet clean up more seriously, and have tried to sell some of the billions in NPLs and toxic loans clogging up their balance sheets. Eurobank agreed to sell €1.5BN of unsecured consumer loans to Sweden’s Intrum last year, while NBG, Piraeus and Alpha plan to sell a total of more than €11BN of NPLs this year.

Yet as the FT adds, these planned sales did not help them in the stress test, which was based on their static balance sheet at the end of 2017. The ECB said its adverse scenario modeled an average 8.5% point hit to the banks’ capital from increased bad loans.

This is shown in the chart below: the average Greek bank has a total Non-Performing Exposure ratio of between 44% and 56%. This means that for all the lipstick, all Greek banks remain completely insolvent should the ECB’s monetary backstops be withdrawn.

Meanwhile, at the national level, the Greek NPE ratio as a % of all loans is at 47%, the highest on the continent, and higher even than in Cyprus. As a % of GDP, Greek NPEs of €108BN are now at 61%, the second highest in Europe. Still, it’s better than the 78% of GDP observed just 2 years ago, so thanks to the ECB’s QE there has been some improvement.

A few final observations: the result of the stress test was widely leaked in advance, and reassuring remarks by Greek officials on the test outcome contributed to a >30% rally in bank share prices over the last month.

Even so, with the modest NPE improvement observed in recent years, Greece still has no clear solution to its banking troubles, because as Goldman concludes, while additional recaps could create buffers for asset quality risks, they are unlikely to resolve bottlenecks around the framework/infrastructure for bad-debt management.

Prospects of a large scale recapitalisation combined with an unclear path to NPE resolution could increase the risks of a state bailout, which we would expect to be a relevant consideration for policy-makers ahead of the negotiations on Greece’s exit from the ESM programme.

The big irony in this latest time and money-wasting exercise simply meant to boost confidence and unlock €20BN from a bank bailout fund, is that just as Greece concludes its negotiations to exit its third bailout, the ECB’s QE will be ending and Europe is set for another financial crisis, which means that one year from now, we will be discussing the terms of the 4th Greeek bailout…

via RSS https://ift.tt/2HWyj6a Tyler Durden

A day after Hawaii’s Kilauea volcano erupted, sending magma bubbling up through cracks in the earth and forcing hundreds of people to flee, the US Geological Survey on Friday recorded a 6.9 magnitude earthquake that was centered in nearly the exact same location as a deadly 1975 quake that caused the deaths of two people, according to Agence France-Presse.

The quake triggered more eruptions by opening up five magma vents in the area, CNN reported. A separate, smaller 5.4 magnitude quake was recorded earlier in the day, as well as a swarm of smaller aftershocks. USGS said it fears the quakes could trigger more eruptions.

M 6.9 – 16km SW of Leilani Estates, Hawaii, 2018-05-04 22:32:55 UTC, 5.0 km depth. https://t.co/g2hWHdnPex This is in almost exactly the same location at the deadly 1975 M 7.1 earthquake. pic.twitter.com/ImkbbL1ruq

— USGS_Seismic (@usgs_seismic) May 4, 2018

USGS said the quake hit at 12:32 pm local time and was centered on the south flank of the Kilauea volcano, which first erupted on Thursday after a series of tremors. In some places, lava could be seen bubbling up through cracks in the street in a tony housing developments known as Leilani Estates and Lanipuna Gardens.

Authorities told AFP to expect more seismic activity.

“Activity continues,” he said, “Nothing is slowing down,” said County of Hawaii Civil Defense Administrator Talmadge Magno.

Roughly 1,700 people live in the area, which is also home to 770 structures. More than 10,000 people live in the broader area that could potentially be impacted by the quakes and eruptions. No injuries have been reported, but several homes were damaged or destroyed.

Drone footage showed the lava gushing up from the ground and traveling through a forest nearby.

The Hawaii Fire Department urged any lingering residents to evacuate.

Officials urged any remaining residents to evacuate and warned of extremely high levels of toxic fumes.

“Hawaii Fire Department reports extremely dangerous air quality conditions due to high levels of sulfur dioxide gas in the evacuation area,” the Hawaii County Civil Defense Agency said.

“Elderly, young and people with respiratory issues need to comply with the mandatory evacuation order and leave the area,” said a statement from the mayor’s office.

But it’s not as if these eruptions were a surprise.

One area resident who spoke with AFP said she was actually relieved that the earthquake happened.

Big Island resident Janice Wei, who moved to Hawaii from California – known for its own high earthquake risk – said the eruption was almost a “relief.”

“We’ve been waiting for big movement from the crater, after so many small earthquakes,” she told AFP.

“Hawaiians and local people have lived here forever,” she said. “You know what’s going on; we have warning systems.

“Everybody should be prepared.”

One geologist told AFP that she and her team had since Monday been following an “intrusion of magma” that was triggered by the collapse of a volcanic crater vent known as Puu Oo.

Geologist Janet Babb of the Hawaiian Volcano Observatory told AFP that scientists had been following an “intrusion of magma” down the rift zone since Monday afternoon in anticipation of a possible eruption.

Though the cracks from which lava was emitting had gone dormant, she emphasized that “the overall concern and the overall event has not ended.”

US Senator Brian Schatz of Hawaii said the Federal Emergency Management Agency was mobilizing resources, as well as monitoring for forest fires, power outages and water supply issues.

Hawaii Island, or the Big Island, is the largest of the eight main islands that comprise the Pacific US state, an archipelago that includes hundreds of smaller volcanic islands.

As magma beneath Kilauea continues to build, USGS reminded area residents to stay vigilant. And we imagine that anybody who has seen the drone footage of the eruption should be ready to do just that:

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Quite a bit of FBI-related news broke late Friday;

• A newly unredacted section of a House Intel Committee report reveals that former Deputy FBI Director Andrew McCabe told Congressional investigators that the FBI had virtually no case against Mike Flynn
• The same report reveals that James Comey contradicted himself during a recent interview with Bret Baier
• Comey, McCabe and then-Deputy Attorney General Sally Yates and Principal Deputy Assistant Attorney General Mary McCord gave the committee “conflicting testimony”
• Anti-Trump FBI “Lovebird” Lisa Page (with whom Peter Strzok was having an affaird) has flown the coop, tendering her resignation on Friday
• One of Comey’s closest confidants, former FBI top lawyer James A. Baker also resigned Friday

A newly unredacted version of the House Intelligence Committee’s final report on Russia was released on Friday, containing bombshell revelations stemming from the Congressional testimony of former FBI and DOJ officials Andrew McCabe and James Comey.

For starters, the redacted section of the report covers up the fact that former deputy director Andrew McCabe told Congressional investigators the FBI had virtually no case against former National Security Advisor Mike Flynn.

McCabe also says that former FBI Director James Comey spearheaded the “ambush” of Flynn at the White House – in which two FBI agents, one of whom was Peter Strzok dropped in unannounced to interrogate him.

Compare the fully redacted version that came out last week to the mostly unredacted version that came out today. Do you see what DOJ/FBI tried to cover up? McCabe s aid they hadn’t substantiated anything against Flynn, and the ambush of Flynn at the WH was directed by Comey. pic.twitter.com/6Fc9U3kVwM

— Sean Davis (@seanmdav) May 4, 2018

McCabe told the committee that “The two people who interviewed [Flynn] didn’t think he was lying[.]” as well as “[N]ot [a] great beginning of a false statement case.”

“Deputy Director McCabe confirmed the interviewing agent’s initial impression and stated that the ‘conundrum that we faced on their return from the interview is that although [the agents] didn’t detect deception in the statements that he made in the interview … the statements were inconsistent with our understanding of the conversation that he had actually had with the ambassador,’” the report states.

Compare these two pages. The initial redacted version hid clear testimony that the FBI didn’t think Flynn lied. McCabe: “The two people who interviewed [Flynn] didn’t think he was lying[.]” And: “[N]ot [a] great beginning of a false statement case[.]” pic.twitter.com/MZNIHCGzPU

— Sean Davis (@seanmdav) May 4, 2018

Next, we learn that Comey lied (or had a terrible lapse in memory) when he told Fox News host Bret Baier that he didn’t tell Congressional investigators what McCabe told them; that the two FBI agents who interviewed former National Security Advisor Mike Flynn didn’t think he was lying to them.

“Director Comey testified to the Committee that ‘the agents…discerned no physical indications of deception,” reads the new report. “They didn’t see any change in posture, in tone, in inflection, in eye contact. They saw nothing that indicated to them that he knew he was lying to them.” 

Here’s what Comey told Fox’s Baier last week: 

Baier: Did you tell lawmakers that FBI agents didn’t believe former National Security Advisor Michael Flynn was lying intentionally to investigators?

Comey: No. And I saw that in the media. I don’t know what – maybe someone misunderstood something I said. I didn’t believe that, and didn’t say that.

See pages 53 & 54 of the Russia report (those two pages just had redactions lifted from the IC) https://t.co/YoFZsfwp6V pic.twitter.com/6EClGdL4Hu

— Nick Short 🇺🇸 (@PoliticalShort) May 5, 2018

As Sean Davis of The Federalist notes, the DOJ and FBI “demanded significant redactions to the document not to protect national security or sources and methods, but to protect potentially corrupt officials from accountability”

It’s clear that DOJ/FBI demanded significant redactions not to protect national security or sources/methods, but to protect potentially corrupt officials from accountability for their actions before and after Trump’s election.

— Sean Davis (@seanmdav) May 5, 2018

The Flynn redactions appear to have been done to protect a false statements case with no evidentiary basis. Others were done to hide apparent conspiracy to spy on and leak against Trump officials out of spite over the election results.

— Sean Davis (@seanmdav) May 5, 2018

In one section, initially redacted material suggests an investigation against Flynn that, per Comey, should have been closed was kept open because he may have *thwarted* Obama admin plans to provoke Russia into disproportionately attxkinf the U.S.

— Sean Davis (@seanmdav) May 5, 2018

House Intel Committee Chairman Devin Nunes (R-CA) weighed in, pointing out to Fox News‘s Laura Ingraham that his committee had “been fighting with the Department of Justice and the FBI, for six weeks, to release this information to the American people.”

It took the DOJ and the FBI 6 weeks to lift redactions on 2 pages of the Russia report. What info was initially redacted? Comey & McCabe saying that agents did not believe Flynn was lying. @DevinNunes explains. See Pg 53 & 54 of Russia report https://t.co/VjsrPX2dkh pic.twitter.com/DYlNlBOOGc

— Nick Short 🇺🇸 (@PoliticalShort) May 5, 2018

Flynn, who has been cooperating with Mueller’s investigation, was forced to resign as Trump’s National Security Advisor last February after pleading guilty to lying to the FBI about perfectly legal and to-be-expected conversations he had with Russian ambassador Sergey Kislyak during the transition. 

So why would Flynn plead guilty?

Some have suggested that Flynn pleaded guilty due to the fact that federal investigations tend to bankrupt people who aren’t filthy rich – as was the case with former Trump campaign aide Michael Caputo, who told the Senate Intelligence Committee “God damn you to hell” after having to sell his home due to mounting legal fees over the inquiry. 

“Your investigation and others into the allegations of Trump campaign collusion with Russia are costing my family a great deal of money — more than $125,000 — and making a visceral impact on my children.”

Thus, it’s entirely possible Flynn pleaded guilty in order to avoid financial ruin – though like Caputo, he didn’t escape having to sell his house in March.

Is it not possible he just plead guilty because of the financial burden it created and is creating on our family?? https://t.co/gx5sLLa1K9

— 🇺🇸MFLYNNJR🇺🇸 (@mflynnJR) April 23, 2018

Another thought is that the FBI simply called Flynn’s bluff and said they caught him in a lie. While perhaps a stretch at this point and certainly unconfirmed, some have suggested that Andrew McCabe instructed Peter Strzok and the other FBI agent who interviewed Flynn to alter their “302” forms – the document FBI investigators use to document an interview.

Investigative journalist Sara Carter has reported that FBI sources maintain the FBI’s deputy director under Comey, Andrew G. McCabe, may have asked FBI agents to alter or change their findings in their 302s; Carter alleges that OIG Inspector General Michael Horowitz is looking into this. –The Hill

So we know that innocent people plead guilty all the time, and that Flynn faced significant financial pressure were he to remain in the Trump administration and fight the claims against him. Also recall that during December 2016, when Flynn spoke with the Russian ambassador, the Russiagate narrative was in a full frenzy. It’s possible that although Flynn and Kislyak’s contact was perfectly legal and to-be expected, he may have been hesitant to tell the FBI about some or all of his communications out of an abundance of caution. It should also be noted that Flynn may have considered the obviously pro-Clinton top brass of the US intelligence community to be “the enemy” and been hesitant to tell them the full truth. 

Until we know more, we can only speculate. 

In other FBI news – Lisa Page and James Baker quit on Friday

Two top Comey advisors announced their departure from the FBI on Friday, leading to speculation that some bad information is about to come out regarding the pair.

Resignations were handed in by James Baker – former top lawyer for the NSA specializing in FISA matters before becoming the FBI’s top lawyer, and lawyer Lisa Page – one of the two “lovebirds” who sent anti-Trump text messages with her co-worker with whom she was having an extramarital affair – special agent Peter Strzok (who spearheaded the Clinton email investigation, the early Trump investigation and interviewed Mike Flynn).

Mollie Hemmingway of The Federalist notes that Page and Baker quit as a highly anticipated report by the DOJ’s Inspector General is “looming,” suggesting that the report will reveal violations of the law egregious enough to call for both of them to hand in their resignations on the same day.

Lisa Page quit today. James Baker quit today. IG report looming. https://t.co/ppU5aNb8w5

— Mollie (@MZHemingway) May 5, 2018

One Twitter user takes it a step further… 

Baker was NSA Gen Counsel specializing in FISA matters. After you hired him, the @FBI engaged in a palace coup attempting to rig a presidential election, then overthrow a President via FISC abuse. Baker was instrumental. You’re both going to prison. https://t.co/hxa45CrAvx

— NameRedacted8 (@nameredacted8) May 5, 2018

Perhaps Page and Baker can set up legal defense funds like Andy McCabe and convince people to give them a half-million dollars to cover upcoming expenses.

via RSS https://ift.tt/2JV6onx Tyler Durden

Authored by Peter Korzun via The Strategic Culture Foundation,

The month of May is always associated with V-E Day. The sentiments of “never again” were strong 73 years ago, in 1945 when the UN was founded. Since then Europe has put a huge amount of effort into creating a unique security system to prevent armed conflicts. It was never perfect, but by and large it worked. Other continents used to look on with envy and try to establish security regimes of their own.

Multiple agreements are still in force, working to prevent the worst scenarios, but today they appear to be somewhat forgotten and are failing to meet their objectives. Yet by no stretch of the imagination would anyone have imagined that May 2018 would be a month spent teetering on the brink of war, with the experts left trying to guess when it will ignite, how far it will spread, and how many actors are likely to be involved. It’s scary but that’s where we are. It’s never been this tense since the worst days of the Cold War.

On May 2, Siil (Hedgehog), the largest NATO exercise to be held in the Baltics since 1991, began in Estonia and Latvia, involving 3, 000 troops from 16 countries. It will last until May 14. Estonia and Latvia border the Russian Federation. Latvia will host five military exercises in May and June. All of this activity is intensive enough for Moscow to interpret it as preparation for war.

June will see large-scale BALTOPS and Sabre Strike 2018 exercises in the Baltics. Europe will host a US armored brigade – a force of at least 4,000 soldiers accompanied by about 90 Abrams tanks, Bradley combat vehicles, 18 self-propelled Paladin howitzers, and other vehicles.

The largest-ever NATO exercise, Anakonda 2018, will be held in Poland this summer. This is the biggest event staged by the alliance since the end of the Cold War and will include about 100,000 troops, 5,000 vehicles, 150 aircraft and helicopters, and 45 warships. Such a huge force will naturally make Russia wary. The NATO Air Policing was stepped up last month. The alliance will conduct 80 joint exercises in Europe this year, mainly aimed at prepping for a war with Russia.

This intensified training is taking place at a time when the Donbas conflict in Ukraine is really heating up. The escalation of tensions is coming on the heels of the US deliveries of Javelin antitank systems to the Ukrainian military. This is the first transfer of lethal weapons.

On May 1, the US State Department released a statement announcing that the American military is shifting to a new phase in its Syria operation. The US-led coalition, the SDF, and its mysterious “local partners” are to be involved. Turkey, Israel, Jordan, Iraq, and Lebanon have also been mentioned as having a role. The Islamic State has not been much of an issue for Beirut, but now Lebanon is very likely to become a battlefield that will draw in many actors, especially Israel and Iran.

Officially the mission is intended to sweep away the remnants of the Islamic State (IS) forces, but that claim should be taken with a grain of salt. Whatever is left of IS is insignificant and can be dealt with without the help of the US-led coalition. The situation in Syria is very explosive now that the US has ratcheted up the tensions instead of pulling out as President Trump said he wanted to do. A wider conflict is right around the corner there. The US-led SDF and the Syrian regular forces have recently been involved in direct clashes — a very worrisome development and coinciding with the Israeli airstrikes against Syrian and Iranian forces.

These war preparations are taking place at the same time that Prime Minister Netanyahu is accusing Tehran of allegedly cheating on the nuclear deal. The US was quick to claim that the evidence was “compelling.” The Israeli parliament has just voted to grant the prime minister the authority to declare war or to order a major military operation without the prior approval of his security cabinet.

US President Trump is widely expected to decertify the Iran deal on May 12 and pay a high-profile visit to Israel when the new US embassy’s provisional site in Jerusalem opens on May 14. The opening ceremony will be the right place and time to announce new moves against Iran — a country that works closely with Russia in Syria and elsewhere.

All the events taking place in Europe and Syria have a direct impact on Russia’s security. A spark is enough to kindle a conflict in Europe.

The never-ending NATO exercises and other operations conducted right up against Russia’s borders are extremely provocative. A war against Iran in Syria appears to be almost certain, since Russian forces are deployed near Iranian positions. It will be next to impossible to strike Iranian or Syrian sites without provoking the Russian military into taking measures to defend itself. A single strike against Iranian forces could be contained but a military campaign against them will inevitably put Russian personnel at risk. Russia has some very formidable military forces positioned in Syria that must be a serious factor in any war scenario.

Tensions are running high in Europe and a wider conflict could ignite at any time in Syria. In either situation it won’t be Russia that provokes the explosive situations that threaten to deteriorate into a full-blown conflict.

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Facebook co-founder Chris Hughes wants to tax anyone who makes over $250,000 to the tune of nearly $3 trillion over ten years, then use the proceeds to provide universal basic income (UBI) to every working American who makes under $50,000 a year, including those providing services such as child care and elder care. 

Hughes, 34, now devotes his time to evangelizing for higher taxes on the rich, such as himself. He’s proposing that the government give a guaranteed income of $500 a month to every working American earning less than $50,000 a year, at a total cost of $290 billion a year. This is a staggering number, but Hughes points out that it equals half the U.S. defense budget and would combat the inequality that he argues is destabilizing the nation. –Bloomberg

Hughes, who has a related book coming out, has made tackling income inequality his top priority by partnering with the Economic Security Project – a major recipient of his philanthropic efforts. The group is focused finding solutions to provide “unconditional cash and basic income” in the United States due to the effects of “automation, globalization, and financialization” forcing the discussion. 

The plan would essentially be an expansion of the Earned Income Tax Credit (EITC) for low-to-moderate income individuals and families.

The Economic Security Project is a network committed to advancing the debate on unconditional cash and basic income in the United States. In a time of immense wealth, no one should live in poverty, nor should the middle class be consigned to a future of permanent stagnation or anxiety. Automation, globalization, and financialization are changing the nature of work, and these shifts require us to rethink how to create economic opportunity for all. –Economic Security Project

While Hughes notes that the annual $290 billion annual price tag is half the U.S. defense budget, he contends that income inequality is destabilizing the nation – and that there is a “very practical concern that, given that consumer spending is the biggest driver of economic growth in the United States and that median household incomes haven’t meaningfully budged in 40 years,” a Universal Basic Income is vital to maintaining economic national security.   

“Cash is just the simplest and most efficient thing to eradicate poverty and stabilize the middle class,” Hughs told Bloomberg at the Economic Security Project’s New York offices at Union Square.

There are many ways to pay for a guaranteed income. However, I do think that the resources can and should come from the people who most benefited from the structure of the economy. We had tax rates at 50 percent for several decades after [World War II]. In the same period, we had record economic growth and broad-based prosperity. I’m not making the case, in the book and in general, that we just need higher taxes. It matters what our tax dollars are going to. Cash is just the simplest and most efficient thing to eradicate poverty and stabilize the middle class. –Bloomberg

You can read the rest of Bloomberg‘s interview with Hughes here. 

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