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This coming Friday is when the Trump administration’s previously announced 25% tariffs on imported steel and 10% for aluminum officially take effect, and while Canada, Mexico and Australia have been excluded from the protectionist measure, planned retaliation by China has triggered concerns over a global trade war. And confirming that trade – and broader economic and commercial – ties with China are set for a sharp deterioration, on Sunday the Trump administration ended a decade-old formal economic dialogue with China amid US concerns the country is becoming increasingly protectionist and moving backward on its promise to open its markets to foreign competition.

Speaking in Buenos Aires ahead of the Group of 20 finance ministers meeting, David Malpass, Treasury’s undersecretary for international affairs, said that “the administration is disappointed with China and because there wasn’t a path back toward a market orientation, I discontinued the China economic dialogue.“

The halt of the main economic channel between the U.S. and China – known as the Comprehensive Economic Dialogue – ends conversations started under one of his predecessors, Hank Paulson, during the George W. Bush administration. Paulson singled out an economic track for the Treasury Department to lead, becoming the point-person on all such matters between the nations.

Still, the severance of ties sounds somewhat more extreme that the underlying reality: quoted by Bloomberg, Malpass said that rather than holding formal discussions, Secretary Steven Mnuchin has frequent private talks with senior-level officials in China to bring back focus to free-market capitalism, he said.

Call it graduated diplomatic escalations meant to find China’s trigger point.

“One of the things we are doing is trying to keep open lines of communication with them even as we express concern” about the growing influence of China’s state-owned enterprises.

He also said that China’s movement toward market liberalization has “stalled or reversed” adding that “it’s become more clear that’s the case. We now see China’s political process moving away from a term limit.”

Referencing the recent “perpetualization” of Xi Jinping, Malpass also highlighted a risk for the world from China’s autocratic rule, saying that the “risk of autocrats being in power too long now exists” and highlighted China’s zombie companies, pointing out that “China is producing steel, aluminum with subsidized finance” which of course is just another form of protectionism.

In a surprisingly accurate take for a government official, Malpass cautioned that “with low bond yields and the availability of capital in both the public and private sphere there is a quiet but very broad leveraging up that we have to recognize as a vulnerability.”

This is precisely what the IMF warned about last December in “The Walking Debt: Resolving China’s Zombies.”

As Bloomberg adds, the first Comprehensive Economic Dialogue during the Trump administration fell apart in July 2017. The two super-powers were unable to produce a joint statement after Commerce Secretary Wilbur Ross scolded China over its trade imbalance with the U.S. in his opening remarks. Both sides canceled a planned closing news conference.

“After 10 years of discussions, certainly the U.S. has grown frustrated with the lack of progress” that resulted from the Comprehensive Economic Dialogue, said Timothy Adams, president of the Washington-based Institute of International Finance and a former Treasury undersecretary in the George W. Bush administration.

“I don’t fault them for their frustration, they’re looking for different ways of bringing about change of Chinese behavior,” he said in an interview earlier this month.

Anticipating the collapse of formal relations, President Xi Jinping recently sent his top economic adviser, Liu He, to meet with Mnuchin. In that meeting, Liu is said to have asked Mnuchin for a point-person to provide a list of specific demands from China, a sign that Treasury’s shuttering of the formal dialogue process may be hampering the process. Liu pointed out that different U.S. administrations have wanted various things, the person said, with Bush focused on monetary policy and Obama emphasizing investment.

Meanwhile, in the latest indication of bilateral relations, Malpass said the U.S. wants to work with other nations to come up with a united response to what America sees as China’s foot dragging on economic changes, ranging from reforming state-owned enterprises to curbing the ruling party’s role in the economy.

“Above all, their markets are not reciprocal in the sense that there’s not an ability for other countries to work in China the way that China works in elsewhere,” Malpass said later Sunday in a Bloomberg TV interview.

As Bloomberg further notes, the new rhetoric contrasts with the more collaborative approach of both the George W. Bush and Obama administrations, who courted China as an economic partner even as the U.S. asserted its military power in Asia. However, in light of Trump’s recent trade war rhetoric, the shift is hardly a surprise.

As discussed last week, as part of the next round of targeted trade wars, Trump is considering clamping down on Chinese investments in the U.S. and imposing tariffs on a broad range of its imports to punish Beijing for its alleged theft of intellectual property. A number between $30 and $60 billion (and perhaps even higher) in tariffs on Chinese imports has been floated.

Also last week we laid out a Goldman report analyzing  which Chinese imports are most likely to be hit by the upcoming round of China-focused tariffs.

All this takes place ahead of the year’s first G-20 meeting of central bankers and finance ministers in Buenos Aires. Talks start Monday and conclude with the release of a statement on Tuesday. They convene at a time when the global economy is in surprisingly strong health, yet concerns are growing that its upswing may boil over, and predictably, the topic of the moment is President Trump’s trade war plans, and as a result many governments are lobbying to be exempted. That could make for an uncomfortable couple of days for U.S. Treasury Secretary Steven Mnuchin as he tries to play down trade frictions. Scandal-plagued Japanese Finance Minister Taro Aso will not be attending.

According to Bloomberg, one of Mnuchin’s primary aims at the G-20 this week is to gain greater visibility into loans China has made to developing countries. The Trump administration is concerned that the U.S.’s top strategic rival is attempting to extend its influence with the loans while moving away from opening its markets to American goods.

“On the positive side, the world is recognizing that and beginning to work together. Recognizing that having such a big economy in the world move away from markets has not been good for us, for the world,” Malpass concluded ominously.

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After a bloody, two month cross-border campaign of Turkish forces to dislodge Kurdish YPG “terrorists” from the Syrian city of Afrin, President Recep Tayyip Erdogan declared complete victory on Sunday as Turkish and allied FSA flags have been raised for the first time over Afrin’s city center.

Kurdish YPG forces (or “People’s Protection Units”) were widely reported to have withdrawn before pro-Turkish forces entered the city before dawn on Sunday, allowing invading forces to secure the city while facing no resistance. In a televised speech Erdogan claimed to have “saved” the city through the “heroic” actions of his military while also framing the operation which took place entirely on Syrian soil as humanitarian in nature. He said, “This operation has shown the whole world that Turkey sides with the oppressed,” as reported by Rudaw.

Kurdish authorities of Afrin canton, for the their part, condemned Russia for allowing Turkey to use airspace to dislodge Kurdish protection units. At a Kurdish press conference, an Afrin canton official leveled the charge that “Russia actively participated in opening airspace for Turkey to ‘exterminate our people with all kinds of weapons and sacrificed our people for their interests in Syria, and under international silence, of the coalition, and EU'”. The spokesperson added that, “We decided to remove civilians from the city to avoid a more terrible humanitarian catastrophe.” 

Erdogan also appears to have taunted the retreating Kurdish forces, saying that a “large number” of Kurdish fighters had “fled with their tails between their legs,” and added that Turkish special forces have been deployed in the city, with demining operations also underway. “Now the Turkish flag will fly over there! The flag of the Free Syrian Army will fly over there!” said Erdogan.

He gave the address at a ceremony marking the battle to open the Dardanelles during the first world war, and the neo-Ottoman aspirations of which Erdogan has long been accused of peppered the speech throughout, including reference to the Ottoman Turkish defense of Gallipoli during World War I. “We are fighting the same way we did in Canakkale,” he said, using the Turkish name for what was the only major historic Ottoman victory of WWI. “They thought that Turkey is not as strong as it was in Canakkale.”

In spite of Erdogan’s high-minded humanitarian rhetoric which has been consistent throughout Turkey’s ‘Operation Olive Branch’, significant evidence has mounted that pro-Turkish forces are actually engaged in an ethnic cleansing campaign targeting northern Syria’s large Kurdish population. In the last three days alone, according to numbers published in The Guardian, over 200,000 civilians have fled the Kurdish-majority city with many dozens killed.

BREAKING: Press conference now by military leadership and local authorities in #Afrin https://t.co/F9WSXWkhdN pic.twitter.com/TxANi6T3DD

— Wladimir (@vvanwilgenburg) March 18, 2018

In all throughout two months of primarily Turkish shelling and aerial bombardment of the Afrin area, there have been close to 300 documented civilian deaths, but the number is likely far higher. Prior to this weekend’s most intense phase of fighting for control of Afrin, the Syrian opposition site Syrian Observatory for Human Rights (SOHR) estimated that at least 245 civilians, including 41 children, have been killed, figures which the United Nations called “deeply alarming” – but stopped short of condemning Turkish actions.

During a Sunday press conference, Kurdish spokespersons for Afrin canton called on the UN Security Council to pressure Turkey “to stop cultural and political genocide against our society and to ensure return of ‘our people to their places with international guarantee.” At the close of the fighting, the Kurdish statement indicates that over 500 civilians were killed, with 1030 civilians injured, and 820 Kurdish fighters killed. 

This is what Turkey brought to Afrin. pic.twitter.com/YUqV4CQ6jB

— Gissur Simonarson (@GissiSim) March 18, 2018

Over the weekend of intense fighting, Turkish forces struck cars packed with fleeing Kurdish civilians and stood accused of targeting Afrin’s lone functioning hospital, according to the BBC. Human Rights Watch (HRW) has also issued reports detailing attacks on civilian homes, buildings, and infrastructure throughout the campaign. And also according to pro-rebel SOHR, over 400 pro-Turkish forces died since January 20.

Meanwhile, Turkey’s president had previously openly voiced a goal of radical demographic shift in northwest Syria based on claimed ethnic statistics as his army invades foreign soil. Syrian Kurdish media has consistently accused Turkey of launching the Operation Olive Branch campaign out of a desire to ethnically cleanse the Turkish border region of its historically Kurdish identity. 

Kurdish spokesmen have also charged Turkey with employing current and former ISIS terrorists and other jihadists in order to do the Turkish state’s dirty work.

ISIS in #Afrîn pic.twitter.com/GSTmEMErt9

— Tobias Huch (@TobiasHuch) March 18, 2018

Indeed Erdogan had previously vowed “to give Afrin back to its real owners” while claiming that “55% of Afrin is composed of Arabs with %35 of Kurds coming there later on”. This as invading Turkish-backed militias (FSA) have been filmed shouting chants related to the ethnic cleansing of Kurds, according to Middle East analyst Hassan Hassan, as well a desire to force all the region’s inhabitants to convert to Sunni Islam.

Currently, it appears an initiative to erase all visible monuments of Kurdish presence and history is already underway: pro-Turkish FSA forces have published a photo which shows them tearing down a statue of a blacksmith named Kawa, an important figure in Kurdish legend. According to Reuters, the Kurdish-dominated Syrian Democratic Forces condemned the removal of the statue as the “first blatant violation of Kurdish people’s culture and history since the takeover of Afrin.”

Newroz symbol in #Afrin was destroyed by Turkish-backed rebels: Kawa statue (unveiled in March 2017) destroyed just a few days before the Kurdish New Year Celebrations (Newroz) that will take place on 21 March h/t @peshmerge pic.twitter.com/9c96tVuOE0

— Wladimir (@vvanwilgenburg) March 18, 2018

On Sunday afternoon, a Kurdish official told The Washington Post that Syrian Kurds have now entered “a new phase” of guerrilla warfare after Turkish troops secured Afrin. A full Kurdish statement was given at a press conference and reads as follows: “we would like to declare that our war against the Turkish occupation and the Takfiri forces called the Free Army has entered a new stage, the transition from direct confrontation war to hit-and-run tactics.”

Meanwhile, Washington continues to soft pedal the significance of this weekend’s events, saying merely citing “fear the Afrin offensive may divert attention from the anti-IS battle” according to the Post.

The Syrian government has again condemned the Turkish violation of Syrian sovereignty and will continue plead its case before the UN. Some analysts have accused the Kurdish YPG of purposefully allowing pro-Turkish forces to occupy Afrin instead of allowing pro-Syrian government factions to defend the town.

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Facebook started it – banning crypto/ICO ads on Jan 30th, then came Google – copying Facebook’s ban on March 14h; and now, less than a week later, Twitter is virtue-signalling support for the crypto-crackdown, planning its own ban on ads.

image courtesy of CoinTelegraph

Sky news reports  that Twitter is preparing to prohibit a range of cryptocurrency advertisements amid looming regulatory intervention in the sector.

The microblogging platform is following similar moves by Facebook and Google which have restricted financial advertisements due to concerns about illicit activities.

Sky News understands that the new advertising policy will be implemented in two weeks and currently stands to prohibit advertisements for initial coin offerings (ICOs), token sales, and cryptocurrency wallets globally.

The reaction was swift, just as we have seen to the other crypto ad bans… smashing Bitcoin back below $7500 (into mystery-dip-buyer territory)…

 

But Ethereum and Ripple have been the worst performers since the crypto ad bans began…

Reportedly, Twitter has experienced an influx of fake accounts pretending to advertise cryptocurrency giveaways, often by users posing as famous crypto sphere personas like Litecoin’s Charlie Lee.

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Authored by John Rubino via DollarCollapse.com,

So many patterns that have held for decades seem to have broken down, leading to one of two conclusions: Either this time really is different in ways that appear to violate what used to be seen as iron-clad laws of finance, or those laws have been bent but will reassert themselves with a vengeance sometime in the future.

The latest example is the relationship between corporate debt and default rates on that debt. Historically they’ve moved in the same direction, with higher debt levels leading to higher default rates. That makes intuitive sense because rising debt implies that borrowing is easier for less creditworthy companies who should be expected to default at a higher rate.

But not this time:

Here’s why default rates are subdued even as corporate debt levels hit records

(MarketWatch) – U.S. corporate debt levels stand above crisis highs even as default rates among the most leveraged firms remain subdued.

With an economy hitting its stride, it’s perhaps no surprise that the high-yield bond market is placid. The extent of the divergence between debt levels and defaults, however, is worrying to some analysts who feel rising corporate indebtedness will eventually catch out unwary investors and deflate the junk-bond market.

But beyond complacency John Lonski, chief economist at Moody’s Capital Market Research, argued that globalization and the tendency of U.S. businesses to hoard cash as reasons why corporate debt levels may no longer move in sync with default rates and credit spreads.

The high-yield default rate in the fourth-quarter of 2017 fell to 3.3%, even as U.S. nonfinancial-corporate debt ended in 2017 at 45.4% of GDP. This compares with a much higher default rate of 11.1% in the second quarter of 2009, with corporate debt levels at 45% of GDP. Granted, the current levels come with the economy in the eighth year of an expansion, while the second quarter of 2009 marked the final quarter of the longest and deepest U.S. recession since the Great Depression.

The yield spread between high-yield bonds and safe government paper, as represented by the 10-year Treasury note narrowed to an average 3.63 percentage points in the fourth quarter of 2017, from an average 12.02 percentage points in the second quarter of 2009. The tight credit spreads reflects that borrowing costs are still close to historic lows, and that investors are demanding minimum compensation for holding arguably the riskiest debt in the bond market.

Moody’s Analytics

One answer “might be supplied by the ever increasing globalization of U.S. businesses where the more relevant denominator is not U.S. GDP, but world GDP” said Lonski.

The fortunes of U.S. companies are now woven into the broader global economy. When commodity prices took a hit in 2015 and early 2016, crimping growth in China and other emerging markets, high-yield bonds were also slammed.
With commodity prices on the rise and global growth making a comeback, it’s no mystery that issuers of high-yield bonds aren’t in any serious trouble.

The tendency of U.S. corporations to accumulate cash could also be to blame. Lonski says net corporate debt to GDP, which subtracts total debt levels by the amount of cash in business balance sheets, was at a much more subdued 33.2%, well below the 45.2% seen in the broader debt to GDP measure.

But the meaningfulness of this statistic may be limited by the “high concentration of cash among relatively few companies,” many of which are considered highly creditworthy.

Tech companies like Apple and Microsoft have been the main components of this trend. In the past, such firms issued debt backed by the collateral of their overseas profits for share buybacks and other forms of shareholder remuneration.

So has the correlation between corporate debt and defaults been broken for good or just for now? “Just for now” remains the most likely answer, since the business cycle is embedded in human nature rather than some kind of external constraint that we can evade with clever tricks. In fact, it’s clever tricks – most recently the fiat currency printing press — that fool us into thinking we control events that used to control us.

And is it worth speculating about what might happen to restore those historical relationships – that is, cause a crisis that spikes junk bond defaults and causes corporate debt to start shrinking? Probably not, since there are so many candidates right now. Something will happen and the lines on the above chart will converge in the upper right corner – and then the bottom right.

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Nearly a month after Reuters reported  that Liu He – a Harvard-educated senior government bureaucrat and longtime friend of Xi – had become the frontrunner to replace outgoing PBOC head Zhou Xiachuan, surpassing banking regulator head Guo Shuqing and veteran banker Jiang Chaoliang who were said to be leading contenders for the PBOC job until last October’s Congress, today the WSJ reported that President Xi Jinping has somewhat unexpectedly picked PBOC deputy governor Yi Gang to run the country’s central bank.

Yi, an American-trained economist who has long pushed for pro-market overhauls will take over from his mentor Zhou Xiaochuan, who has run the People’s Bank of China for a decade and a half and who “steered the institution through the global financial crisis, overhauled monetary policy tools and oversaw the elevation of the yuan to reserve-currency status during his record 15-year term” as Bloomberg recaps.

Yi’s nomination, which was reviewed by nearly the 3,000 delegates to the National People’s Congress on Sunday afternoon, is set to be approved by China’s “rubber-stamp” legislature in a formal vote on Monday.

And for those wondering, no Gang never worked for Goldman Sachs.

* * *

As the WSJ writes, the changing of the guard at the central bank, part of a broad reshuffle of party and government posts following last fall’s inauguration of a new Communist Party leadership, is a key component in Mr. Xi’s effort to shape an economic team, which now mostly consists of his trusted allies in order to cement himself as China’s “president for life”.

Some background from Bloomberg:

Yi joined the central bank in 1997 and served in a succession of roles before promotions to deputy governor and administrator of the State Administration of Foreign Exchange. As head of the currency regulator, he presided over expansion of the world’s largest foreign reserve stockpile, which peaked in 2014 at nearly $4 trillion, along with more loosening of currency trading restrictions and greater emphasis on increasing the yuan’s international use.

Like Zhou, Yi is also a fluent English speaker with longstanding links to global economic leaders. Yi earned a business degree at Hamline University in St. Paul, Minnesota, and a Ph.D. in economics at the University of Illinois before moving to Indiana University at Indianapolis as a professor in 1986, according to his official PBOC biography.

And now comes the hard part: Yi inherits a central bank which while more influential at home and abroad than the one that Zhou took over in 2002, faces much more complex challenges. The biggest threat will be the PBOC’s “calibration” of its response to 3 or more Fed rate hikes this year, while pushing forward with Xi’s financial cleanup and deleveraging campaign without crashing an economy whose debt/GDP according to the IIF is already well above 300%.

Meanwhile, the PBOC will be keeping a watchful eye on accelerating inflation too, and if that wasn’t enough, Yi will also be tasked with maintaining a stable currency just as Trump prepares to launch a trade war with Beijing.

“The PBOC is in more of bind than ever with its monetary policy,” said Zhao Yang, chief China economist at Nomura. “While it was fine to just look at inflation and economic growth targets in the past, the central bank now has to strike a balance among more targets, some of them conflicting.”

Furthermore, the PBOC faces those tasks at a time of major institutional changes. As we reported last week, in a sweeping, $43 trillion overhaul, China merged its bank and insurance regulators, a move which gave the central bank power to write rules for the financial sector, and likely makes it the most powerful body in the new Financial Stability and Development Committee.

Perhaps the biggest unknown is how Lie will respond to a developed world that is shifting away from years of easy money. Jerome Powell succeeded Janet Yellen as Fed chair in February and Bank of Japan Governor Haruhiko Kuroda is set to begin another term. And though European Central Bank President Mario Draghi doesn’t conclude his time in office until late next year, jostling over his replacement has already begun, while the ECB is preparing to end its QE by the end of the year.

* * *

In conclusion, here are the five most pressing tasks that Yi Gang will be facing on his first day as the new PBOC governor, via BBG:

1. Financial Sector

If the $40 trillion financial sector is a ticking time-bomb, then the PBOC governor will be among those sweating over which wire to cut. Reducing risky inter-bank lending, weeding out dangerous behavior by asset managers, and corralling internet credit will all be key tasks, all while trying to prevent funding to the real economy from cratering.

While it’s done a decent job so far with that balancing act, the central bank now also must find its place in a new regulatory structure for the bodies in charge of oversight. Whether the PBOC is the leading light of this effort or one among many may depend on the profile of the new governor. And the clock’s ticking — the financial sector faces further shakeups now that authorities have lifted some curbs on foreign ownership.

2. Policy Framework

How the PBOC interacts with markets in pursuit of its nominal policy goals — maintaining stability in the value of the currency and thereby promoting economic growth — is undergoing a shift. From the credit quotas of the planned-economy era that focused on the quantity of money in the system, the central bank is ultimately headed toward letting short-term interest rates set the price of money, as its global peers have long done.

Under Zhou, the PBOC has developed a bewildering array of instruments to guide market rates — but now it’s trying to focus attention on just two at a time when it’s actually increasing the range of maturities it uses.

Streamlining the policy framework will be a key task for the new governor, especially as the central bank has already announced that it’s moving to a “two-pillar” system that pairs rates policy with tools geared to regulate prices of financial assets.

3. Communication

Of the world’s major central banks, the PBOC talks the least. Whereas Federal Reserve and European Central Bank officials give hundreds of policy speeches each year, Zhou does just a handful.

There are signs, though, that the central bank wants to better explain itself to markets, and has slowly increased commentary this year. In an ever-more complex market environment, Zhou’s successor may have to engage in open-mouth operations a little more.

4. Currency Management

Managing China’s massive capital inflows and outflows, and their effect on the yuan, complicates PBOC efforts to regulate the amount and price of liquidity in the market. It’s a task they may ultimately be glad to be rid of, but for now heading toward a freer-floating yuan is something that the next governor is likely to continue.

Moving in that direction may aid another big goal for Beijing: boosting global use of the yuan. Despite the International Monetary Fund conferring a reserve-currency status last year, the currency’s share of global payments is down from a 2.79 percent peak in August 2015.

5. Inflation

With hefty financial-sector and currency tasks already on its plate, it would be easy for the PBOC to forget a little about its inflation mandate. With a damaging episode of runaway inflation in the 1990s in mind though, Zhou’s successor should keep a close eye on developments.

Consumer prices adjusted for food and fuel held at their fastest since 2011 in October, evidence that surging factory prices are beginning to feed through. The government’s drive to reduce pollution could also spur inflation, making a tightening of policy not unthinkable.

While PBOC has to take instruction from the State Council for major policies, the governor can always leverage his knowledge and experience to guide the direction of the policy debate, said Ding Shuang, chief economist for Greater China & North Asia at Standard Charted Bank Ltd in Hong Kong.

“It’s an important ability to make good arguments for its policies to top leaders, which helps the PBOC find a louder voice among policy makers, even though it may not enjoy full independence,” he said.

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In one of his signature early morning tweetstorms, President Trump raged on Sunday about the political slant of Special Counsel Robert Mueller’s investigative team and accused former FBI Director James Comey of lying under oath.

The tweets followed an Axios report published late Saturday night claiming that former FBI Director Andrew McCabe – who was fired by Attorney General Jeff Sessions on Friday and was stripped of his pension benefits – had met with Mueller, who asked him about Trump’s firing of Comey nearly a year earlier, and also turned over “contemporaneous” memos that he’d taken detailing his conversations with the president.

According to Axios, the memos contained a corroborating account of Comey’s firing.

Trump claimed that Comey lied during public Senate testimony last Spring, when he said he’d never been an anonymous source for the news media – then admitted that he had “authorized” a friend to leak one of his memos to the New York Times, which Comey said he did in hopes of sparking a special counsel investigation.

In this particular case, Trump may be referencing what he discussed last night, namely that McCabe may himself have jeopardized Comey, a point made by constitutional law professor Jonathan Turley on CNN, who suggested that McCabe’s statement following his firing “immediately” raised a flag, which may lead to serious consequences for his former boss. McCabe’s statement reads in part:

The OIG investigation has focused on information I chose to share with a reporter through my public affairs officer and a legal counselor. As Deputy Director, I was one of only a few people who had the authority to do that. It was not a secret, it took place over several days, and others, including the Director, were aware of the interaction with the reporter.

Turley notes “There was one line in the case statement last night that I immediately flagged. Because he said that he had authority to do this and he conferred with the director – the director at the time was James Comey.”

“Now, the problem there is that James Comey said under oath that he never leaked information and never approved a leak,” said Turley. “So, if the Inspector General believes this was a leak to the media, it raises serious questions about Comey’s previous testimony and could get him into serious trouble.”

This contradicted Comey’s statement under oath that “he never leaked information, and never approved a leak.” Turley continued. “So if the Inspector General believes this was a leak to the media, it raises serious questions about Comey’s previous testimony that could get him into serious trouble.”

And here’s Trump this morning:

Wow, watch Comey lie under oath to Senator G when asked “have you ever been an anonymous source…or known someone else to be an anonymous source…?” He said strongly “never, no.” He lied as shown clearly on @foxandfriends.

— Donald J. Trump (@realDonaldTrump) March 18, 2018

Trump then turned his attention to McCabe, saying he “never took notes when he was with me. I don’t believe he made memos except to help his own agenda, probably at a later date. Same with lying James Comey. Can we call them Fake Memos?”

Spent very little time with Andrew McCabe, but he never took notes when he was with me. I don’t believe he made memos except to help his own agenda, probably at a later date. Same with lying James Comey. Can we call them Fake Memos?

— Donald J. Trump (@realDonaldTrump) March 18, 2018

Trump then turned his attention the Mueller probe, and asked why does Mueller have “13 hardened Democrats, some big Crooked Hillary supporters and Zero Republicans? Another Dem recently added…does anyone think this is fair?”

Why does the Mueller team have 13 hardened Democrats, some big Crooked Hillary supporters, and Zero Republicans? Another Dem recently added…does anyone think this is fair? And yet, there is NO COLLUSION!

— Donald J. Trump (@realDonaldTrump) March 18, 2018

Late last night, Trump tweeted that the Mueller probe “was based on fraudulent activities” and insisted that it should never have been authorized.

The Mueller probe should never have been started in that there was no collusion and there was no crime. It was based on fraudulent activities and a Fake Dossier paid for by Crooked Hillary and the DNC, and improperly used in FISA COURT for surveillance of my campaign. WITCH HUNT!

— Donald J. Trump (@realDonaldTrump) March 18, 2018

In a statement, Trump lead attorney John Dowd said in a Saturday morning to the Daily Beast that “I pray that Acting Attorney General Rosenstein will follow the brilliant and courageous example of the FBI Office of Professional Responsibility and Attorney General Jeff Sessions and bring an end to alleged Russia Collusion investigation manufactured by McCabe’s boss James Comey based upon a fraudulent and corrupt Dossier.” Dowd initially said he was speaking for the president before clarifying his statement, and claiming he was speaking in personal capacity.

In a statement published by McCabe – who was offered a security position by Wisconsin Congressman Mark Pocan, which should allow him to finish his tenure and collect his pension – the former deputy FBI director said that his dismissal was a deliberate effort to slander him and part of an “ongoing war” against the FBI and Mueller’s investigation, according to the Washington Post.

This is likely just the start of Trump’s angry tirade about McCabe’s firing, especially if the career FBI employee does go on to collect his full pension with the help of some Congressional democrats.

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Authored by Mohammed Ayoob via National Interest,

Both India and Pakistan have between 120 and 140 nuclear warheads, according to estimates provided by the Arms Control Association. However a report produced in 2015 by the Carnegie Endowment for International Peace and the Stimson Center asserts that Pakistan may be outpacing India in terms of its nuclear stockpile, and may possess 350 nuclear warheads in the next five to ten years. A 2016 SIPRI report confirmed the assessment that Pakistan has more nuclear warheads than India.

However, what distinguishes the two neighbors’ nuclear-weapons programs from each other is not so much the pace of production or the size of the stockpiles, but their radically different nuclear doctrines.

The major difference between the two countries’ nuclear doctrines is that while India has renounced first use of nuclear weapons, Pakistan has refused to do so by reserving its right to use nuclear weapons in the face of India’s conventional superiority.

So far, uncertainty regarding Pakistan’s nuclear threshold is the principal factor preventing a major conflagration in South Asia. Pakistan’s refusal to disavow first use of nuclear weapons, and its emphasis on amassing tactical nuclear weapons and short-range missiles as a corollary of its nuclear doctrine, can be explained in light of its conventional-force inferiority vis-à-vis India. It is in fact a mirror image of the American nuclear doctrine as applied to central Europe during the Cold War. The United States refused to disavow first use of nuclear weapons, and deployed tactical nuclear weapons in central Europe on a large scale, because of NATO’s presumed inferiority in terms of conventional power vis-à-vis that deployed by the Warsaw Pact.

But for Pakistan, the uncertainty introduced by its nuclear doctrine has achieved another major objective as well. It has provided Pakistan with the shield behind which terrorist groups armed and trained by Islamabad, such as Lashkar-e-Taiba and Jaish-e-Muhammad, can engage in acts of terror that create mayhem not only in Indian-administered Kashmir but also in other parts of India. The fear of escalating a conflict with Pakistan to the nuclear level has prevented India from retaliating to these provocations with the massive use of its superior conventional force.

India desisted from retaliating against terrorist bases or Pakistani military installations even when a massive terrorist operation launched from Pakistan targeted India’s financial capital, Mumbai, in November 2008. This attack lasted for more than sixty hours and left at least 174 people dead.

However, it seems that the logic of this deterrence is fast eroding. Attacks such as the one in Mumbai, and subsequent assaults on Indian military installations in Kashmir and elsewhere, have also provided justification for India’s hard-line Hindu nationalists to heighten anti-Pakistan rhetoric, and putting pressure on the Indian government to intensify its military response. In the past few months, Indian retaliatory attacks have targeted not only terrorist bases but also Pakistani military facilities, causing significant casualties among Pakistani forces.

The escalation in the last two years in terror attacks, especially by Jaish-e-Muhammad, with the obvious connivance of the Pakistan army, on Indian military targets in Kashmir and surrounding Indian states has made the situation very perilous. In the past several months, terrorist groups operating from Pakistan have undertaken several such major attacks, causing significant loss of life among Indian security forces.

A major terrorist attack on the Uri camp in Jammu and Kashmir in September 2016, which left seventeen military personnel dead, motivated the Indian government to reassess its strategy for responding to such attacks. On September 29, 2016, India launched its first publicly acknowledged “surgical strike” against terrorist bases in Pakistan. Although there had been speculation that India had conducted such strikes earlier as well, this was the first admission by New Delhi that it was ready to launch major retaliatory attacks against targets in Pakistan and Pakistan-occupied Kashmir.

In the latest incident, in February 2018, Jaish terrorists attacked an Indian military camp in Jammu; five army personnel and four militants were killed. In retaliation, the Indian army destroyed a Pakistani army post with the help of rocket launchers, killing, according to Indian sources, twenty-two Pakistani personnel. This tit-for-tat exchange is reaching dangerous proportions.

So far, the Pakistani military has downplayed Indian incursions and retaliatory attacks and refused to recognize their seriousness, because it does not want to appear weak in the eyes of the Pakistani public, which is then likely to clamor for revenge. However, the Pakistani military cannot continue to downplay Indian attacks, especially in light of the increasing fatalities. There is the danger that at some point, either by miscalculation or by design, an Indian surgical strike in Pakistani territory will push the Pakistani military—which controls the nuclear weapons—to retaliate in force.

If a full-scale war erupts, at some point Pakistan, unable to counter superior Indian conventional forces, could resort to battlefield nuclear weapons, as its doctrine proclaims. While India subscribes to a no-first-use doctrine, it has made it abundantly clear that it will massively retaliate against any use of battlefield nuclear weapons by Pakistan without making a distinction between tactical and strategic nuclear weapons. This strategy, as enunciated in a statement issued by the government of India on January 4, 2003, is designed to inflict unacceptable damage on the enemy.

Former Indian national security advisor Shivshankar Menon elaborated this strategy in his memoirs:

“India would hardly risk giving Pakistan the chance to carry out a massive nuclear strike after the Indian response to Pakistan using tactical nuclear weapons. In other words, Pakistani tactical nuclear weapon use would effectively free India to undertake a comprehensive first strike against Pakistan.”

This is a very scary scenario. Pakistan’s overreliance on its nuclear deterrence, especially its refusal to subscribe to the no-first-use doctrine, when combined with its reckless support for terrorist groups attacking Indian military and civilian targets, could unintentionally usher in a nuclear winter – and spell doom not only for South Asia, but for a much wider area surrounding the subcontinent.

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A few days ago, we published a Property Shark analysis of the wealthiest zip codes in America, and found that – to our complete lack of surprise – the wealthiest towns are clustered around the Bay Area and New York City A, attend their own schools, shop at their own stores and live in their own exclusive enclaves of wealth.

While those data were largely anticipated, that study also showed that midwestern and even some southern areas had seen remarkable gains.

The same pattern applies to Property Shark’s latest study, which ascertained the wealthiest zip codes in the country by median income. Contrary to what one might expect, PS found that most of the nation’s 100 most expensive zip codes were on the West Coast, while most of the wealthiest 100 zip codes were on the East Coast.

The ultimate takeaway from these data are that, as one might expect, being able to afford an expensive home doesn’t necessarily mean a wealthy family will buy one. After all, frugality is inevitably one of the traits that helped them accumulate wealth.

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The East Coast Dominates The Light Of High-Earning Zips Codes

Of the nation’s top 100 earning zip codes, 70 are located on the East Coast…

Predictably, there are two areas where most zip codes are clustered: The Northeast with 48 zip codes, and the suburbs around Washington DC, with 28 spots in the top 100.

Going by state, the ranking of the most expensive zip codes for housing was dominated by California, with 77 spots on the list. However, the picture changed drastically when PS looked for the highest-earning zip codes. By that measure, Cali only took 17 spots in the top 100, while New York led with 20 codes. Of those, 8 are located in Manhattan. Most of the others cover well-established communities in Westchester County.

Maryland and Connecticut trail New York and California, each claiming 10 spots in the ranking. New Jersey and Virginia follow, further strengthening the East’s dominance, thanks to the D.C. suburbs. Washington, DC itself only managed to claim 1 spot in the ranking.

Unlike the list of priciest zip codes for home prices, the by-income scale is more heterogeneous, with 15 states taking spots on the list. Virginia, Washington DC, Delaware, Illinois, Texas, and Pennsylvania were all absent from the top 100 most expensive zip codes, but they were present in the homeowner income ranking.

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Here’s Where Zip Codes With $250k+ Income Stand In Terms Of Home Prices

The first 11 highest-earning zip codes all feature a yearly median household income of over $250,000. New York leads with 5 of the 11 zip codes that feature top-bracket median incomes, followed by California with 4 zip codes. Of the top 11 zip codes by median income, the highest ranked based on median sale price is 10013 in Manhattan, which took the 2nd spot.

On the other hand, San Diego’s 92145 did not even make the cut in the 100 priciest zips for housing, although the median income here exceeds $250,000. The median price here clocked in at $1,332,500, not enough to secure it a spot in the top 100. Furthermore, 2 of the 11 zip codes have median sale prices well below $1 million—Chappaqua’s 10514 and Chicago’s 60603. In zip code 60603, the median sale price recorded in 2017 was $495,000 and, with a median gross income of over $250,000, it stands out as the market with the smallest gap between median price and income.

Check out Property Shark’s interactive map here:

 

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