Author: admin

Of all people…

The former head of the conservative Bundesbank believes that central banks need to embrace digital currencies and he’s concerned that they’re being left behind. This might be interesting, we thought. Axel Weber has been talking to the FT but, it turns out, he hasn’t shaken off his bureaucratic roots since he took on the Chairmanship of UBS. Instead of embracing Bitcoin, Ethereum, decentralisation and private enterprise, Weber thinks central banks, and the likes of UBS, will benefit from creating their own versions. According to the FT.

Central banks should be more open to creating digital versions of their currencies, which could offer significant benefits to society, the chairman of Swiss bank UBS says. Axel Weber is a past president of Germany’s conservative Bundesbank — and was once tipped as a future head of the European Central Bank. As UBS chairman, he is helping to drive a revolution in how banks, companies and individuals conduct financial transactions. In an interview with the Financial Times, he now worries his former public sector colleagues may be left behind.

 

“Whilst the official sector very often looks at the risks of these new means of payment, the private sector tends to look at the opportunities they offer,” he says.

What’s worse, a central banker or a central banker who thinks his time in the private sector makes him somehow superior to his former colleagues. Uggh. Anyway, rather than highlighting the transparency and money trail aspects of Bitcoin and its ilk, Weber sees tighter regulation to crack down on…you guessed it…the usual nefarious list of crimes which the authorities have proved incapable of policing for decades before Bitcoin was conceived. The FT continues.

The chairman argues the issue is not the volatility of bitcoin prices – the currency is “simply too insignificant to matter” from a financial stability perspective. It’s more that the threat of the crypto world financing terrorism or enabling money laundering will eventually prompt a stronger response from authorities. There is “a relatively high probability that regulators will regulate it at some point”.

Now the FT, possibly influenced by comments from Weber, begins to get itself muddled, arguing that central bank-created digital currencies would, in contrast to Bitcoin, act as stores of value. Because…they would be “backed by the monetary authorities”.

Less clear cut, however, are likely to be arguments over digital currencies issued by central banks. Like cash, which they could eventually replace — but unlike bitcoin — they would be backed by monetary authorities, so they would also act as a store of value as well as widely accepted means of payment. In China, the central bank has said it will develop a digital currency using the blockchain technology behind bitcoin. In Europe, Sweden’s Riksbank published a report in September suggesting there were few obstacles to issuing e-krona. But other central banks have been much more cautious. Jens Weidmann, Mr Weber’s successor as Bundesbank president, argued the focus should instead be on improving existing payment systems. Like the Bundesbank, the Swiss National Bank is not convinced of the need for central bank e-currencies.

The question of infinite versus finite supply was not mentioned. Moving on…

If conventional fiat currencies were genuine stores of value, they should be a haven in times of panic, obviously. Instead, the FT fears that customers could exacerbate bank runs by switching funds out of fiat into digital currencies in a crisis.

There are fears that in times of panic, customers could quickly switch funds out of normal bank accounts and into e-currencies, exacerbating bank runs. Germans and Swiss also remain heavy users of cash – unlike Swedes.

While Weber makes the valid point that digital currencies can reduce the cost of payment services and provide transparency, the FT article articulates the benefits in a surprisingly narrow way.

Mr Weber, however, says central banks are wrong to think it is a case of either traditional cash or e-currencies. Payment patterns evolve, he says, with younger generations more likely to pay via mobiles, independently of banks. If central banks regarded digital currencies as an opportunity, they could “probably provide non-account-related payment services for society in a cheaper and more economic way”.

 

The advantages would be most apparent in geographically large countries, where cash transport is expensive — such on the African continent. Mr Weber envisages digital currencies not having the anonymity of cash — indeed features in the currency could identify users, so minors could be prevented from buying alcohol, for instance. But the technology would have to be hacker-proof. “It has to be a very secure means of payment.”

In true bureaucrat fashion, however, UBS is developing its own digital currency which will use blockchain technology to enhance its settlement process.

Meanwhile, UBS is pressing ahead with its own digital currency. It is working with other banks, including Barclays, Credit Suisse and HSBC, on a “utility settlement coin”. It would use the same distributed ledger technology as blockchain and could be used to clear and settle financial transactions. The idea is that “coins” used for transactions would be backed by cash held in accounts at central banks. They would be safer and quicker than current systems based around a single centre counterparty. Mr Weber reports “an openness by central banks to hear about the concept” but admits the scheme is a long way from becoming operational.

Like JPMorgan’s Jamie Dimon, Weber is pushing the “Blockchain is good, Bitcoin is bad narrative”.

Debate about the future of digital currencies has been overshadowed by the hype over bitcoin. Does Mr Weber worry a bitcoin crash might set back digital currency pioneers? The UBS chairman is adamant it will not. “People do…draw the distinction between the construction of bitcoin or cryptocurrencies as they are now, and the potential that the underlying technology has,” he says.

Weber holds back in the article from laying out the globalists’ wish for a digital world currency, but we have little doubt that he would, if asked. We were reminded again of the famous Economist cover from 1988, which predicted a world currency in 2018…with that slashed zero symbol in the middle of the coin.

Slashed zero from Wikipedia:

The slashed zero glyph is often used to distinguish the digit "zero" ("0") from the Latin script letter "O" anywhere that the distinction needs emphasis, particularly in encoding systems, scientific and engineering applications, computer programming (such as software development), and telecommunications.

(H/T Ned Naylor-Leyland, Old Mutual Global Investors)
 

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Tis the gift to be loving, tis the best gift of all
Like a quiet rain it blesses where it falls
And with it we will truly believe
Tis better to give than it is to receive

-Additional verse to Simple Gifts

 

Here it is, again, with plenty of time remaining for you to deploy capital: hedgeless_horseman’s Twelve Days of Christmas shopping list for the ZeroHedge readers in your life. 

 

1) Hell’s Angels: A Strange and Terrible Saga, by Hunter S. Thompson $12

This is a very well written book, maybe his best, about an incredibly interesting group of freedom loving Americans.  I referenced it in my recent ZH article, What would an anonymous, open-source, distributed-network, outlaw-gang look like?

 

2) Nigel Calder’s Cruising Handbook: A Compendium for Coastal and Offshore Sailors $39

If ever someone’s world turns to complete shit, and you want them to know which sailboat to beg, barter, or steal from the marina, and how to sail it, then this book is the ticket.

 

3) A bottle of Yuu Baal Mezcal Anejo $45

If you made it to the First ZeroHedge Symposium and Live Fight Club in Marfa, Texas, then you probably had more than a few shots of this with yours truly.  Very, very, smooth and earthy, it also works well sipped straight from the bottle in front of a campfire under the stars.  

 

4)  Staub Cast Iron Crêpe Set $99

A house guest from France helped us to perfect our crêpes.  mrs_horseman likes the sweet ones for breakfast with hot apples, crème fraîche, and caramel.  I like the savory ones for dinner with ingredients such as sausage, goat cheese, spinach, tomato, savory, and egg.  Like all Staub products, this pan should last a lifetime.   

 

5) Trezor Bitcoin Hardware Wallet $119

If you want to get soemone started with Bitcoin, then get them a Trezor, and have them read my article, hedgeless_horseman’s E-Z Internet Guide To Safely Buying and Then Conveniently Losing Bitcoin in a Tragic Boating Accident.   

 

6) Dave Ramsey’s Financial Peace University $119

We have given this 9 week course as a gift to family and employees, always recommending the live classes over the online.  It works because Dave understands that getting out of debt and building wealth is not so much about knowledge, as it is about behavior.   mrs_horseman and I regularly use Dave’s tactics for talking with your spouse about money, which alone is worth the price.

 

7)  “Bob” Century’s Body Opponent Training Bag $270

If you have a man on your Christmas list, like me, that is about half-a-century old, then consider this tool to help him keep his testosterone levels up, naturally, without drugs.  Just 5 minutes of beating the fuck out of Bob-the-Central-Banker, after my regular trail runs, and I am much better off physically, biochemically, and emotionally.  Easily converts to Larry-the-Lawyer, Paul-the-Politician, and Joe-the-Journalist. 

 

8)  12 Square Foot Indoor DIY Friendly Aquaponics System $311

This is the perfect gift for teaching kids of all ages, no matter where they live, that our food doesn’t come from a supermarket.  If you want to go bigger, read the ZH article, Disintermediation yields a 2822% return on investment.

 

9)  Previously beloved Waterford Crystal tumblers, cocktail stemware, and decanter. Four tumblers or stems will cost between $90 and $600, and about the same for one decanter.

We visited the Waterford crystal factory in Ireland, just as they were shutting down production and moving it to Eastern Europe.  It was incredibly sad.  I have always found that a an Irish whiskey, cocktail, or Champagne is so much more enjoyable when served from, and in, Irish crystal.  Fortunately, the people at www.replacements.com can still help you give this experience to the people on your gift list that would appreciate some of the finest things in life.

 

10)  A set of two Ultra-light Level III PLUS Ceramic / Polyethylene Rifle Plates (Stand-Alone) $518

…and a BlackHawk Lo-Vis “Semi-Concealable” Plate carrier $50

As Hunter said, “When the going gets weird, the weird turn pro.”  If someone on your list is concerned about things turning weird, then give the gift of protection this holiday season.  These will stop multiple hits of .308, but yet are so light that the little wife can easily wear them all day long.

 

11)  Paul Bond custom cowboy boots $1,000 and up 

In Marfa, many of you asked where we got our cowboy boots.  For more than 30 years our answer has been and remains Paul Bond.  There is simply no better boot maker in the universe.  As a gift to yourself, send in your measurements, and have a pair custom made.  They will last you a lifetime, and you will never regret it.

 

12)  Preparing for Zombie Apocalypse in just one weekend for less than $1,200

If you know a family, maybe even your own, that needs to check off the “prepper” box, and then move on in life, this is the gift.    

 

Merry Christmas!

 

h_h

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via http://ift.tt/2zCJK20 Tyler Durden

After transferring over the bulk of his personal wealth to his “Open Society” Foundation – the umbrella organization for a network of dozens of political groups that push Soros’s far-left agenda across the US and Europe, Soros is still comfortable enough to justify giving away even more of his money – this time to the US federal government.

Taking a page out of Warren Buffett's book, Soros and a group of some 400 other rich Americans – including doctors, lawyers and CEOs – are sending a formal letter to Congress chiding lawmakers for trying to reduce taxes on the richest American families at a time when wealth inequality is rapidly expanding. Instead, the letter asks Congress not to pass any tax bill that “further exacerbates inequality” and adds to the debt (both of the current Republican plans would add $1.5 trillion to the debt over 10 years).

The letter was penned by Responsible Wealth, a group of “enlightened” rich people that includes Ben & Jerry's Ice Cream founders Ben Cohen and Jerry Greenfield, fashion designer Eileen Fisher and philanthropist Steven Rockefeller, in addition to Soros. Along with the big names are many individuals and couples who rank among the top 5% of Americans (those who have $1.5 million in assets or earn $250,000 or more a year).

In a rebuttal to Congress’s argument that corporate tax cuts will help stimulate growth, the letter argues that corporations are already reaping record profits. Instead of handing more money to the wealthy, the letter’s signers argue the government should use the funds to invest in education, research and roads that benefit everyone, while protecting entitlement programs like Medicaid.

In the letter, Congress’s push to repeal the estate tax was singled out for criticism. The tax, is only levied on assets worth more than $5.49 million ($11 million for couples) that are left to heirs. The House bill would eliminate the estate tax entirely. The Senate plan would double the threshold so people could inherit up to $11 million ($22 million for couples) tax free.

Only 5,000 families a year end up paying the estate tax. Under the Senate plan, that would drop to just 1,800 families, according to a report by the Joint Committee on Taxation, Congress's official nonpartisan estimators.

“Repealing the estate tax alone would lose an estimated $269 billion over 10 years — more than we would spend on the Food and Drug Administration, Centers for Disease Control, and Environmental Protection Agency combined,” the letter said.

Bob Crandall, a former American Airlines CEO, told the Post “I think a tax cut is absurd,” he said. Republicans are “saying we can’t afford to spend money, but we can afford to give rich people a huge tax break.”

Unsurprisingly, most of the signers of the letter come from California, New York and Massachusetts – states that went for Democrat Hillary Clinton in the last election. Former labor secretary Robert Reich, a backer of Bernie Sanders, also signed the letter. The campaign was organized by Responsible Wealth in partnership with Voices for Progress, another liberal organization.

One of the letter’s signers, a wealthy paper-mill scion from New York, pointed out the seeming absurdity in wealthy people asking Congress not to cut their taxes.

“This has to be one of the few times members of Congress have been visited by people saying, 'Don’t give me a tax cut,'" said Mike Lapham, who inherited sizable wealth from his family's paper mill in Upstate New York and now directs the Responsible Wealth project at United for a Fair Economy. "Wealthy people are saying it themselves: We don't need a tax cut."

Of course, like most political stunts of this caliber, we imagine the letter will be promptly ignored by Republicans. And many of the letter’s signers probably recognize this, too. Because if anybody believed the letter might actually influence the decision-makers in Congress, instead of serving solely as an instrument for virtue-signaling, we imagine there’d be a lot fewer rich people willing to sign.

Read the full letter below:

* * *

Dear Member of Congress:

We are high net worth individuals, many in the top 1%, who care deeply about our nation and its people, and we write with a simple request: Do not cut our taxes.

As you consider changes to the tax code, we urge you to oppose any legislation that further exacerbates inequality. Tax reform should be, at a minimum, revenue neutral—without using gimmicks like dynamic scoring. We are deeply concerned that revenue loss would lead to deep cuts in critical services such as education, Medicare and Medicaid, and would hamper our nation’s ability to restore investments in our people and communities.

The Republican tax plan would disproportionately benefit wealthy individuals and corporations with provisions including repealing the estate tax, repealing the Alternative Minimum Tax, and slashing the top pass-through tax rate. This proposal would mean wealthy people could pay a lower tax rate than many middle-class families and transfer massive inheritances to their heirs tax-free. Such proposals that benefit the wealthy would exacerbate the current wealth disparity in the U.S. where the top 1% of households hold 42% of the wealth.

We believe the key to creating more good jobs and a strong economy is not tax breaks for those of us who have plenty, but investing in the American people. Our civic institutions that help people meet basic living standards and protect the climate are critical to supporting our prosperity as a nation. Yet, Congress is already shortchanging the investments needed to strengthen our economy, and the Administration and some in Congress are looking for deeper cuts. Current federal funding for non-defense discretionary spending was slashed overall by more than 13% (adjusted for inflation) over the past seven years, leaving many programs severely underfunded. While Congress should be finding ways to increase funding for these vital investments, the Republican tax plan would instead add at least $1.5 trillion in tax cuts to the deficit over the next decade. This would leave us unable to meet our country’s current needs and restrict us in advancing any future investments.

A full repeal of the estate tax alone would lose an estimated $269 billion over 10 years —more than we would spend on the Food and Drug Administration, Centers for Disease Control, and Environmental Protection Agency combined. While these critical agencies help millions of people, repealing the estate tax would benefit just two out of every 1,000 estates. It is neither wise nor just to give wealthy people more tax breaks at the expense of working families, and it would be especially egregious to fund tax cuts for the wealthy by cutting or dismantling programs that help people meet fundamental human needs like healthcare or nutrition assistance.

Instead, we call on Congress to raise our taxes to bring in additional much-needed revenue and to restore investments to vital services. Doing so will help create jobs, strengthen the middle class, and ensure America’s economic success. Under no circumstance should tax reform lose revenue, especially to provide tax cuts to the wealthy and corporations.

Respectfully,

(signers)

 

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Having soared 160% from last Wednesday's close, making a billionaire of the CEO, Roku is down 6% this morning, testing $40; as perhaps, just perhaps, the short squeeze won't echo Volkswagen…

From $18.84 to $48.80 in 3 days… Soaring above all analysts' estimates…

Is the 27% of the float that's short now burned through?

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Authored by Patrick Buchanan via Buchanan.org,

If the crown prince of Saudi Arabia has in mind a war with Iran, President Trump should disabuse his royal highness of any notion that America would be doing his fighting for him.

Mohammed bin Salman, or MBS, the 32-year-old son of the aging and ailing King Salman, is making too many enemies for his own good, or for ours.

Pledging to Westernize Saudi Arabia, he has antagonized the clerical establishment. Among the 200 Saudis he just had arrested for criminal corruption are 11 princes, the head of the National Guard, the governor of Riyadh, and the famed investor Prince Alwaleed bin Talal.

The Saudi tradition of consensus collective rule is being trashed.

MBS is said to be pushing for an abdication by his father and his early assumption of the throne.

He has begun to exhibit the familiar traits of an ambitious 21st-century autocrat in the mold of President Recep Tayyip Erdogan of Turkey.

Yet his foreign adventures are all proving to be debacles.

The rebels the Saudis backed in Syria’s civil war were routed. The war on the Houthi rebels in Yemen, of which MBS is architect, has proven to be a Saudi Vietnam and a human rights catastrophe.

The crown prince persuaded Egypt, Bahrain and the UAE to expel Qatar from the Sunni Arab community for aiding terrorists, but he has failed to choke the tiny country into submission.

Last week, MBS ordered Lebanese Prime Minister Saad Hariri to Riyadh, where Hariri publicly resigned his office and now appears to be under house arrest. Refusing to recognize the resignation, Lebanon’s president is demanding Hariri’s return.

After embattled Houthi rebels in Yemen fired a missile at its international airport, Riyadh declared the missile to be Iranian-made, smuggled into Yemen by Tehran, and fired with the help of Hezbollah.

The story seemed far-fetched, but Saudi Foreign Minister Adel al-Jubeir said the attack out of Yemen may be considered an “act of war” — by Iran. And as war talk spread across the region last week, Riyadh ordered all Saudi nationals in Lebanon to come home.

Riyadh has now imposed a virtual starvation blockade — land, sea and air — on Yemen, that poorest of Arab nations that is heavily dependent on imports for food and medicine. Hundreds of thousands of Yemeni are suffering from cholera. Millions face malnutrition.

The U.S. interest here is clear: no new war in the Middle East, and a negotiated end to the wars in Yemen and Syria.

Hence, the United States needs to rein in the royal prince.

Yet, on his Asia trip, Trump said of the Saudi-generated crisis, “I have great confidence in King Salman and the Crown Prince of Saudi Arabia, they know exactly what they are doing.”

Do they? In October, Jared Kushner made a trip to Riyadh, where he reportedly spent a long night of plotting Middle East strategy until 4 a.m. with MBS.

No one knows how a war between Saudi Arabia and Iran would end. The Saudis has been buying modern U.S. weapons for years, but Iran, with twice the population, has larger if less-well-equipped forces.

Yet the seeming desire of the leading Sunni nation in the Persian Gulf, Saudi Arabia, for a confrontation with the leading Shiite power, Iran, appears to carry the greater risks for Riyadh.

For, a dozen years ago, the balance of power in the Gulf shifted to Iran, when Bush II launched Operation Iraqi Freedom, ousted Saddam Hussein, disarmed and disbanded his Sunni-led army, and turned Iraq into a Shiite-dominated nation friendly to Iran.

In the Reagan decade, Iraq had fought Iran as mortal enemies for eight years. Now they are associates, if not allies.

The Saudis may bristle at Hezbollah and demand a crackdown. But Hezbollah is a participant in the Lebanese government and has the largest fighting force in the country, hardened in battle in Syria’s civil war, where it emerged on the victorious side.

While the Israelis could fight and win a war with Hezbollah, both Israel and Hezbollah suffered so greatly from their 2006 war that neither appears eager to renew that costly but inconclusive conflict.

In an all-out war with Iran, Saudi Arabia could not prevail without U.S. support. And should Riyadh fail, the regime would be imperiled. As World War I, with the fall of the Romanov, Hohenzollern, Hapsburg and Ottoman empires demonstrated, imperial houses do not fare well in losing wars.

So far out on a limb has MBS gotten himself, with his purge of cabinet ministers and royal cousins, and his foreign adventures, it is hard to see how he climbs back without some humiliation that could cost him the throne.

Yet we have our own interests here. And we should tell the crown prince that if he starts a war in Lebanon or in the Gulf, he is on his own. We cannot have this impulsive prince deciding whether or not the United States goes to war again in the Middle East.

We alone decide that.

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30 million Americans who woke perfectly healthy yesterday morning are now suddenly in need of expensive hypertension treatments after the American Heart Association and the American College of Cardiology decided to lower the definition of “high blood pressure” to 130/80 from the previous trigger of 140/90.  According to Reuters, the change means that nearly 50% of American adults, or roughly 100 million people, now suffer from high blood pressure.

Americans with blood pressure of 130/80 or higher should be treated, down from the previous trigger of 140/90, according to new guidelines announced on Monday by the American Heart Association and the American College of Cardiology.

 

At the new cutoff, around 46 percent, or more than 103 million, of American adults are considered to have high blood pressure, compared with an estimated 72 million under the previous guidelines in place since 2003.

 

High blood pressure accounts for the second-largest number of preventable heart disease and stroke deaths in the United States, second only to smoking.

 

A large, government-sponsored study of hypertension patients aged 50 and older showed in 2015 that death from heart-related causes fell 43 percent and heart failure rates dropped 38 percent when their systolic blood pressure was lowered below 120 versus those taken to a target of under 140.

 

But patients in the 120 systolic blood pressure group had a higher rate of kidney injury or failure, as well as fainting.

Not surprisingly, these new guidelines are expected to be a boon for pharma giants like Merck, Pfizer and Novartis who supply the world’s expensive hypertension medications.

Potentially deadly high blood pressure can be brought under control with a wide array of medications, many sold as relatively inexpensive generics. The drug classes include angiotensin receptor blockers, such as Novartis AG’s Diovan, calcium channel blockers, like Pfizer Incs’s Norvasc, ACE inhibitors, including Pfizer’s Altace, and diuretics, such as Merck & Co Inc’s Hyzaar.

 

But the drugs have side effects and the new guidelines emphasize lifestyle changes including weight loss, diet and exercise as the first tool for combating hypertension.

 

“I think this will encourage both patients to adhere to recommendations but also clinicians to be more vigorous in their attempts to prescribe lifestyle changes,” said Dr. Pamela Morris, chair of the ACC’s committee on prevention of cardiovascular disease.

Of course, perhaps a slight, artificial “tweaking” of their addressable market was exactly the right cure for what’s been ailing Merck’s stock of late…

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