The southeast Asian country of Brunei has extended a moratorium on the death penalty for violations of sharia law prohibiting gay sex, after a massive backlash by celebrities which included a boycott of luxury hotels and other businesses owned by the Kingdom.
[I]n a rare response to criticism aimed at the oil-rich state, the sultan said the death penalty would not be imposed in the implementation of the Syariah Penal Code Order (SPCO).
Some crimes already command the death penalty in Brunei, including premeditated murder and drug trafficking, but no executions have been carried out since the 1990s. –Reuters
The reversal comes after Brunei fired off an angry letter to the European parliament last month defending its decision to begin enforcing the laws on April 3 in accordance with sharia customs the country adopted in 2014. Parliament had considered imposing asset freezes, visa bans and the blacklisting of nine hotels owned by the Brunei Investment Agency, including the Beverly Hills hotel, Hotel Bel-Air and the Dorchester in London.
“I am aware that there are many questions and misperceptions with regard to the implementation of the SPCO. However, we believe that once these have been cleared, the merit of the law will be evident,” said the sultan during a speech ahead of the start of the Islamic holy month of Ramadan.
“As evident for more than two decades, we have practiced a de facto moratorium on the execution of death penalty for cases under the common law. This will also be applied to cases under the SPCO which provides a wider scope for remission.“
While it appears that those who engage in same-sex sodomy will be spared their lives, no indication has been given as to what will be done to them. There is also no word on what will be done to those who commit other crimes, as the new laws allow for the amputation of thieves and whipping of crossdressers wearing clothes associated with the opposite sex.
In regard to whipping, if that is deemed by sharia courts to be the appropriate punishment, the kingdom said this will be administered only by those of the same gender as those convicted.
“The offender must be clothed, whipping must be with moderate force without lifting his hand over his head, shall not result in the laceration of the skin nor the breaking of bones, and shall not be inflicted on the face, head, stomach, chest or private parts,” it stated. -The Guardian
In late March a boycott led by George Clooney was joined by the likes of Sharon Stone, Elton John, Jamie Lee Curtis, George Takei and others, who refuse to patronize the Brunei-owned establishments.
via ZeroHedge News http://bit.ly/2ZR3Q2y Tyler Durden
Why the cryptic wording on the Steele Dossier? Why wasn’t Trump given an opportunity to defend himself in court?
You know that movie with Bruce Willis and the kid who says “I see dead people”? In the end, it turns out everyone is already dead. Now imagine there are people who don’t believe that. They insist the story ends some other way. Spoiler alert: the Mueller Report ends with no collusion. No one is going to prosecute anyone for obstruction. That stuff is all dead. We all saw the same movie.
Yet there seem to still be questions from those who don’t get it. And while it’s doubtful that the stoic Robert Mueller will ever write a tell-all book, or sit next to Seth Meyers and Trevor Noah to dish, he may be called in front of Congress. If he is, here’s some of what he should be asked.
1) You didn’t charge President Donald Trump with “collusion,” obstruction, or any other new crime. Tell us why. If the answer is “the evidence did not support it,” please say so.
2) Your Report did not refer any crimes to Congress, the SDNY, or anyone else. Again, tell us why. If the answer is “the evidence did not support it,” please say so again.
3) Despite making no specific referrals, the Report does state, “The conclusion that Congress may apply the obstruction laws to the President’s corrupt exercise of the powers of the office accords with our constitutional system of checks and balances and the principle that no person is above the law.” Why did you include such a restating of a known fact? Many have read that line to mean you could not indict a sitting president and so you wanted to leave a clue to Congress. Yet you could have just spelled it out—”this is beyond my and the attorney general’s constitutional roles and must/can only be resolved by Congress.” Why didn’t you?
4) Similarly, many believe they see clues (a footnote looms as the grassy knoll of your work) that the only reason you did not indict Trump was because of Department of Justice and Office of Legal Counsel guidance against indicting a sitting president. Absent that, would you have indicted? If so, why didn’t you say so unambiguously and trigger what would be the obvious next steps?
5) When did you conclude there was no collusion, conspiracy, or coordination between Trump and the Russians such that you would make no indictments? You must have closed at least some of the subplots—the Trump Tower meeting, the Moscow Hotel project—months ago. Did you consider announcing key findings as they occurred? You were clearly aware that there was inaccurate reporting, damaging to the public trust. Yet you allowed that to happen. Why?
6) But before you answer that question, answer this one. You made a pre-Report public statement saying Buzzfeed’s story that claimed Trump ordered Michael Cohen to lie to Congress was false. You restated that in the Report, where you also mentioned that you privately told Jeff Sessions’ lawyer in March 2018 that Sessions would not be charged. Since your work confirmed that nearly all bombshell reporting on Russiagate was wrong (Cohen was never in Prague, nothing criminal happened in the Seychelles, and so on), why was it only that single instance that caused you to speak out publicly? And as with Sessions, did you privately inform any others prior to the release of the Report that they would not be charged? What standard did you apply to those decisions?
7) A cardinal rule for prosecutors is to not publicize negative information that does not lead them to indict someone—”the decision does the talking.” James Comey was criticized for doing this to Hillary Clinton during the campaign. Yet most of your Report’s Volume II is just that, descriptions of actions by Trump that contain elements of obstruction but that you ultimately did not charge. Why did you include this information so prominently? Some say it was because you wanted to draw a “road map” for impeachment. Why didn’t you just say that? You had no reason to speak in riddles.
8) There is a lot of lying documented in the Report. But you seemed to only charge people with perjury (traps) early in your investigation. Was that aimed more at pressuring them to “flip” than at justice per se? Is one of the reasons several of the people in the Report who lied did not get charged with perjury later in the investigation because by then you knew they had nothing to flip on?
9) In regard to the June 2016 Trump Tower meeting, where derogatory information on Hillary Clinton was offered (but never given), you declined prosecution. You cited in part questions over whether such information constituted the necessary “thing of value” that would have to exist, inter alia, to make its proffering a campaign finance violation. You don’t answer the question in the Report, but you do believe information could be a “thing of value” (the thing of value must exceed $2,000 for a misdemeanor and $25,000 for a felony). What about withholding information? Could someone saying they would not offer information publicly be a “thing of value” and thus potentially part of a campaign finance law violation? Of course I’m talking about Stormy Daniels, who received money not to offer information. Would you make the claim that silence itself, non-information, is a “thing” of value?
10) You spend the entire first half of your Report, Volume I, explaining that “the Russians” sought to manipulate our 2016 election via social media and by hacking the Democratic National Committee. Though there is a lot of redacted material, at no point in the clear text is there information on whether the Russians actually did influence the election. Even trying was a crime, but given the importance of all this (some still claim the president is illegitimate) and the potential impact on future elections, did you look into the actual effects of Russian meddling? If not, why not?
11) Everything the Russians did, according to Volume I, they did on Obama’s watch. Did you investigate anyone in the Obama administration in regard to Russian meddling? Did you look at what they did, what was missed, whether it could have been stopped, and how the response was formed? Given that Trump’s actions towards Russia followed on steps Obama took, this seems relevant. Did you look? If not, why not?
12) Some of the information gathered about Michael Flynn was picked up inadvertently under existing surveillance of the Russian ambassador. As an American, Flynn’s name would have been routinely masked in the reporting on those intercepts in order to protect his privacy. The number of people with access to those intercepts is small, and the number inside the Obama White House with the authority to unmask names is even smaller. Yet details were leaked to the press and ended Flynn’s career. Given that the leak may have exposed U.S. intelligence methods, that it had to have been done at a very high level inside the Obama White House, and that the leak violated Flynn’s constitutional rights, did you investigate? If not, why not?
13) TheNew York Timeswrote that “some of the most sensational claims in the [Steele] dossier appeared to be false, and others were impossible to prove. Your report contained over a dozen passing references to the document’s claims but no overall assessment of why so much did not check out.” Given the central role the Steele Dossier played in your work, and certainly in the investigation that commenced as Crossfire Hurricane in summer 2016, why did you not include any overall assessment of why so much did not check out inside such a key document?
14) Prosecutors do not issue certificates of exoneration. The job is to charge or drop a case. That’s what constitutes exoneration in any practical sense. Yet you have as your final line that “while this report does not conclude that the President committed a crime, it also does not exonerate him.” Why did you include that, and so prominently?
15) You also wrote, “if we had confidence after a thorough investigation of the facts that the president clearly did not commit obstruction of justice, we would so state.” You argue elsewhere in the Report that because Trump is a sitting president, he cannot be indicted, so therefore it would be unjust to accuse him of something he could not go to court and defend himself over. But didn’t you do just that? Why did you leave the taint of guilt without giving Trump the means of defending himself in court? You must have understood that such wording would be raw meat to Democrats, and would force Trump to defend himself not in a court with legal protections, but in an often hostile media. Was that your intention?
via ZeroHedge News http://bit.ly/2vG1mGk Tyler Durden
After weeks of heated rhetoric and the exchange of threats related to US oil export sanctions on Iran, and with both sides eyeing the enforcement of its rights over the vital Strait of Hormuz in the Persian Gulf, the White House has just announced what will be looked on by Tehran as a major and potentially dangerous escalation.
White House national security advisor John Bolton announced Sunday night the immediate deployment of a full aircraft carrier strike group and bomber task force to the Persian Gulf region.
The Nimitz-class aircraft carrier USS Abraham Lincoln, via The National Interest
The official statement cites that CENTCOM is responding to multiple “troubling and escalatory” Iranian actions, and reads as follows:
In response to a number of troubling and escalatory indications and warnings, the United States is deploying the USS Abraham Lincoln Carrier Strike Group and a bomber task force to the US Central Command region to send a clear and unmistakable message to the Iranian regime that any attack on United States interests or on those of our allies will be met with unrelenting force. The United States is not seeking war with the Iranian regime, but we are fully prepared to respond to any attack.
Iran has within the past week vowed to keep exporting oil even as the White House vowed to take it down to “zero” – this after ending the waiver program which allowed up to eight nations to continue Iranian crude purchases on a conditional and limited basis.
Iran has also vowed to continue patrolling the key narrow Strait of Hormuz passageway, through which some on-third of the world’s oil passes.
However, after the US formally designated Iran’s Islamic Revolutionary Guard Corps (IRGC) a terrorist organization, the question remains over whether the US military will actually engage IRGC fast boats known to routinely patrol the same region over which CENCOM naval assets operate.
The White House’s sending the USS Abraham Lincoln to the region, likely first near Qatar, makes the potential for a major incident leading to direct exchange of fire between the US and Iran now much more likely.
via ZeroHedge News http://bit.ly/2LqUSWz Tyler Durden
It’s only appropriate that the S&P may be about to suffer its biggest drop of the year one day after hitting a new all time high.
For those who are only now catching up, the reason why futures are tumbling is that just after 12pm ET, Trump tweeted that trade talks – which according to the White House, media leaks and Larry Kudlow would be basically concluded by next week – are instead effectively dead, as the current 10% tariff will spike to 25% on Friday, while an additional $325BN in goods will be subject to new trade tariffs.
Some saw in Trump’s tweet a retaliation for Friday’s North Korea ballistic missile launch, the first since 2017, and one which would not have happened without the explicit blessing of Beijing.
Others were more nuanced, and Nomura’s Charlie McElligott writing late on Sunday that “either this is an epic act “rope-a-dope” posturing and poker-playing from POTUS to collect a (self-perceived) “better” deal “win” thereafter…as the 500-handle rally in Spooz has given Trump enough confidence to absorb a market drawdown and again “lean-into” what some in the administration believe is Chinese “slow-playing”—all in an attempt from to extract additional last-minute deal concessions, after last week’s reported negotiation setbacks—OR a raging ‘miscalculation’ with “vigilante” markets.”
For now it is looking like it’s the latter, with futures tumbling and the Emini down a whopping 55 points on Sunday night, shaping up as the third biggest intraday drop of the year so far.
But Nasdaq is worst for now (down over 2%) as Dow is down 500 points.
Meanwhile, the (non-USD) FX markes is getting absolutely crushed, with China proxies such as the Aussie and Kiwi tumbling, because, as McElligott adds, the key risk is that the offshore Yuan (CNH) may tumble – which it is currently, plunging over 1.3%, or the biggest move since Jan 2016, “as market forces anticipate that China may allow the Yuan to weaken considerably IF they choose to retaliate (a big “IF”), following their prior perceived ‘goodwill’ controlling of the exchange rate within a tight band the past three months for trade negotiation purposes.”
Treasury futures are dramatically bid (implying a 7.5bps drop in 10Y yields).
Meanwhile, in an attempt to prevent a Sunday rout, Goldman published a note after 6pm Eastern, in which the bank’s chief political economist, Alec Phillips, comments on Trump’s announcement that the tariff rate on $200bn of imports from China will rise from 10% to 25%, noting that it “lowers the odds of a successful conclusion to US-China trade talks and raises the odds of further tariff escalation. However, we think it is more likely that the increase will be narrowly avoided and believe the odds of tariffs increasing on Friday are 40%.”
Well, it may be time for Goldman to rename itself Gartman Sachs, because the digital ink wasn’t even dry yet on that note when the WSJ reported that China is considering canceling trade talks with the U.S. After Trump’s sudden, unexplained threats, adding that:
Trump’s Tweets Threatening New Tariffs Surprised Chinese Officials
Decision Weighs on Whether Vice Premier Liu He Goes to Washington as Planned
Canceling Talks Conform to China’s Strategy Not to Negotiate Under Threat
And while the WSJ was somewhat tentative in its reporting, reporter Edwards Lawrence was far more convinced that it’s pretty much game over: “Chinese Vice Premier Liu He has cancelled his trip to Washington this week for trade talks following a tweet by President Donald Trump threatening more tariffs because the talks have moved too slowly. “
Chinese Vice Premier Liu He has cancelled his trip to Washington this week for trade talks following a tweet by President Donald Trump threatening more tariffs because the talks have moved too slowly. #China#Trade#Breaking
So it looks like it is indeed likely that US-China trade talks may be about to implode (especially with Goldman’s “kiss”). Meanwhile, going back to McElligott’s note, this “unexpected” negative development couldn’t come at a worse time for investors, as after avoiding rushing into the meltup for over 4 months, “it was leveraged funds who were finally “forced in” last week (through start of week), covering $9B of SPX futures short positioning, while we also saw Macro Funds take up their “Beta to SPX” WoW, going from 11th %ile to now 51st %ile into the start of the week. Tough timing.” Tough indeed, and here are some other “tough” observations:
There is a very large Asset Mgr ‘net long’ in US Eq Futs, as they currently hold a total $123B net long notional position across US Equities Futures (SPX, NDX, Russell)—with $62.4B / half of the overall position bought YTD alone
As half of this position then is deeply ‘in the money,’ it would make sense that an extreme ‘risk-negative’ reaction to this news by the market tonight / tomorrow could elicit AM profit-taking to monetize some of this performance YTD
Finally, with the Emini back under 2,900 all eyes are now back on 2,890 – that’s both where dealer gamma turns negative again, selling begets more selling…
Source: Nomura
… and is also where the CTAs start dumping in earnest, as per these latest updated market triggers, according to McElligott:
S&P 500, currently 100.0% long, as of tomorrow would be selling under 2878.76 to get to +57%, more selling under 2635.85 to get to -100% , flip to short under 2636.14 max short under 2635.85 —deleveraging triggers moves up to 2894.26 in a week and 2900 in 2 weeks, in 3 weeks 2932
Russell 2000, currently 100.0% long, as of tomorrow would be selling under 1565.7 to get to +57%, more selling under 1557.82 to get to -100% , flip to short under 1557.98 max short under 1557.82–deleveraging levels move up to 1600 in a week, 1617.52 in 2 weeks, in 3m weeks 1616
NASDAQ 100, currently 100.0% long, as of tomorrow would be selling under 7578.15 to get to +57%, more selling under 6657.92 to get to -100% , flip to short under 6658.7, max short under 6657.92–deleveraging levels move up to 7641 in a week, 7687.84 in 2 weeks, in 3m weeks 7842.53
For the TL/DR crowd: Steven Mnuchin better have the PPT on speed dial.
via ZeroHedge News http://bit.ly/2Ji3AUl Tyler Durden
In light of today’s shocking update from Trump on the true state of trade war, one which confirmed what we said all along, namely that there is no deal coming any time soon, some are wondering if that record short in VIX futures that has quickly since the start of the year and now amounts to 180K net spec shorts, is about to lead to a VIX explosion a la Feb. 2018 amid a Volkswagen-like short squeeze.
Maybe, but also maybe not.
As a reminder, we were the first to point out in “A War Has Broken Out In The VIX Complex” that even as massive VIX futs piled up on the short side, the vega of vol ETPs was approaching an all time high, and in fact, according to the latest update, was indeed at a record level.
Now, superficially, there is a kind of a symmetry around this divergence, one which has managed to confuse not only the more chronically clueless members of the fintwit echo chamber, but apparently the likes of Goldman Sachs’ derivatives expert, Rocky Fishman.
And speaking of Fishman, on Friday, the Goldman strategist published a “Q&A on the VIX ETPs’ record long positioning“, in which he laid out some of the core basics, including his calculation of the ETP sector’s sensitivity to VIX moves, or vega. In a nutshell, Fishman echoes what we said three weeks ago, and notes that “the net position of the ETPs is more long than ever before, with almost $300mm of exposure per VIX futures point. The TVIX (2x levered VIX ETN) is currently the largest ETP by AUM and largest by far by total VIX futures exposure. The TVIX and the newly-renamed VXX (formerly VXXB) have each received around $1bln of inflows year-to-date (though each has a market cap below $1bln due to negative performance). The growth in long VIX products and the lack of interest in short VIX products both reflect defensiveness by their investors. With the beta of VIX futures to the SPX at about 3 times and the weighted VIX future close to 16, this position is similar in magnitude to a $15bln short position in SPX futures.
Incidentally, and Fishman is correct about this, the current layout in vol ETP land is a mirror image of the record short position ahead of the Feb 2018 volatility explosion, while hedge funds were modestly short VIX.
Where we disagree with Fishman, is his dismissal of the record short VIX position which, as shown in the top chart, is certainly a concern to anyone who is short the VIX index, and may be caught in a massive short squeeze (assuming there is one).
The crux of Fishman’s argument is his outright dismissal behind the record VIX short, which he claims is simply “because VIX ETPs have a record long position.” Actually, that’s not true, but let’s hear Rocky out: according to the Goldman strategist…
… futures contracts are a zero-sum market – for every future one investor is long, another investor needs to be short a future. The CFTC provides two different reports on VIX futures that both show positioning that adds up to zero, as the sum of the positions of long investors is the mirror image of the position of short investors. We find the Traders in Financial Futures report to be the more informative of their reports, and its Leveraged Funds category (which generally consists of hedge funds) has had a growing short VIX position to offset ETP issuers’ long positions (predominantly reporting in the Dealer category). The Legacy report’s Commercial category for VIX likely consists mostly of ETP issuers, so its Non-Commercial category likely represents everyone else. With VIX futures at a record long, the rest of the investor universe is at a record short. We believe that much of that short VIX futures position is in hedged and relative value structures, rather than in outright short volatility.
In theory, Fishman is of course, correct that non-commercials always, by definition, offset commercials. Where he is wrong, is assuming that commercial specs are by definition rolled into the ETP umbrella. This, as so many examples in the past have demonstrated, is patently not true, and instead the variance of futures vs ETF/ETP products has everything to do with investor types, the first being the preference of institutional investors due to their liquidity, the former being the pick of retail investors due to its low cost.
Refuting Goldman, and confirming precisely this point is Deutsche Bank’s own derivative strategist Parag Thatte, who in his latest weekly flows report also observes the record divergence between VIX futs and VIX ETPs. This is how he lays it out:
Recent inflows of $2.7bn YTD to long vol products have driven vega outstanding across the VIX ETP complex to a record high of $255mn. At the same time, net short positioning in VIX futures contracts is also at a record high.
Thatte also lays out the best visual relationship between the two series, by charting the Vega of the ETP complex vs the non-commercial VIX net specs. Clearly, there is a correlation.
And this is where Goldman and DB’s takes on the chart above differ, because while Goldman finds the relationship to be a one to one net off, DB actually reads between the lines, so to speak, and points out that “the inverse relationship between positioning in the VIX futures market and Vol ETPs suggests that demand for long vol exposure from primarily retail investors is being recycled to institutional players, likely Hedge Funds, in the VIX futures market.”
In other words, and this is what Goldman fails to observe, is that it has all to do with the investor class behind a given vol position, as on one hand we have retail investors who have never been more long vol (ironically, they may end up being proven right very soon), while institutions, and hedge funds, are the shortest VIX they have ever been, perhaps simply because they missed the rally in stocks YTD, and have been scrambling to at least pick up some carry, and the easiest place to do that is by shorting spot VIX.
Of course, with enough shorts on board, the risk rises of a massive squeeze, only instead of one driven by retail investors as was the case back in 2018, this time it will be hedge funds that light the match.
Or maybe not just yet, because one place where both Goldman and DB agree on is that we are not at such extremes as we saw back in late January 2018. First, here is Thatte:
While vega outstanding in the Vol ETP complex is at record highs, vega-to-buy on a vol spike driven by leveraged Vol ETPs is low relative to Jan 2018. So while VIX positioning is stretched, the risk of a reinforcing feedback loop on a vol spike driven by leveraged products is relatively low.
And here is Fishman, generally agreeing with Thatte:
When vol rises, both levered long and inverse VIX ETP issuers buy VIX futures, contributing to vol-of-vol. However, currently the size of that impact is benign. A quantitative analysis of ETP issuers’ need to rebalance should VIX futures spike sharply shows that the amount of VIX futures issuers would be economically driven to buy on a given volatility spike is around 1/4 of the amount they would have been driven to buy prior to the Feb-2018 VIX spike. Levered long ETPs do have the potential to be especially impactful on an escalating, multi-day VIX spike, because their exposure to VIX futures would be growing each day of the spike (unlike short ETPs which would be getting smaller each day). VIX options’ implied volatility has risen recently, but is still not very high compared with its 2017-18 ranges, indicating that investors are not unusually worried about current positioning.
Could both strategists be wrong in their optimistic take on the broader implications of a potential VIX squeeze? Absolutely, and in fact, judging by the sudden waterfall in futures late on Sunday and surge in the VIX, now that the trade deal between the US and China appears to be dead, we may find out very soon just how wrong both Goldman and Deutsche may end up being.
via ZeroHedge News http://bit.ly/2LqdDts Tyler Durden
Yesterday was Star Wars Day. May the 4th and all that. Maybe I’m a little old to be celebrating a movie, but whatever.
As I reviewed the events of the past week it reminded me that Star Wars, at its core, is about the pivotal moments in history and the changing from one political order to another.
Be it the fall of the Old Republic in the prequel films to the end of the Empire and Palpatine’s rule in the Original Trilogy. We even open The Force Awakens with Kylo Ren wiping out the last group of people who still revere the Jedi to begin his quest to consolidate power amidst the chaos.
Star Wars has always functioned as a mirror to our current political drama. Films emerge every generation to reflect where we’re headed as a society. Maybe that’s why the new films aren’t as well loved by a part of the fan base, they are telling us things we don’t want to hear.
So maybe it is fitting that this week’s events were all so indicative of what is happening in our world today.
The post WWII institutional order and political elite are old.
And the old institutional order is failing.
The outdated and old enmities between the U.S. and Russia led to a series of disastrous decisions by men and women who are obsessed with overcoming their thwarted expectations of enhanced power and prestige.
There was Operation Bay of Fat Pigs, coup-attempt which unfolded in real time in Caracas on Tuesday. John Bolton was “snookered” (H/T to Moon of Alabama for excellent reporting on this) by Venezuelan officials into thinking they had the military and supreme court on their side.
When Juan “Random Fall Guy” Guaido made his move and no one else did, the U.S. was caught televising live their own ineptitude. And then laughably tried to blame the Russians for it.
While it is clear that Venezuelan President Nicolas Maduro had outwitted him, Bolton apparently continues to rail on U.S. Southern Command leadership and President Trump to invade.
Why? Because John Bolton is old, inflexible and well past his use-by date for coherent foreign policy decisions.
Lindsay Graham wandered in out of the bathhouse to wonder where our aircraft carriers were and why weren’t they sending a clear message to those pesky Russians?
And everyone else around the world is wondering what the hell are people in D.C. smoking?
If that wasn’t enough for you, how about the ridiculous spectacle of Democratic senators venting their desperation and vitriol at Attorney General William Barr for raining on their impeachment parade.
Mueller, his staff of hatchetmen, the Obama administration and the rest of the corrupt old-guard in D.C. fully expected to be allowed free rein to convict Trump politically of Obstruction of Justice based on an interpretation of Federal Statutes that could only be justified in the world of Philip K. Dick’s Minority Report.
When that didn’t happen they are now looking at potential blowback from a vain and vindictive man occupying the supposedly most powerful office in the world.
But is that really the case anymore? It seems John Bolton has been more president than Trump recently.
The Federal Reserve revealed they have no answers to the rapidly brewing dollar liquidity problem they created and can’t extricate themselves from. Dropping Interest on Excess Reserves was pure window dressing on a problem far deeper than they can publicly admit to.
Crossing the pond we have the insistence of Theresa “Baghdad Bob” May that she’s still working towards a real Brexit after the complete wipeout of her Tory party in local council elections across the whole of England.
Then there’s the latest scandal with May firing adolescent Defense Minister Gavin Williamson for leaking her cabinet’s corrupt relationship with Chinese mobile technology leader Huawei.
If May’s goal is to destroy the British government in preparation for selling the country lock, stock and two smoking barrels to the European Union, then she may be the only truly competent politician left in the West.
They all just look so old and like a bunch of sorry has-beens getting together for a Love Boat 30th anniversary special instead of serious people with serious policy solutions.
The DNC is in the midst of a coup attempt of its own by Cenk Uygur and the Justice Democrats. Their only choice is to rally around Pedo Joe Biden who is fully implicated in the RussiaGate mess with his deep ties to Ukraine where so many of the lies about Trump originated.
Biden is 78. Bernie Sanders is is about to be.
The European Union is staring at the worst kind of blowback to its brutal strategy to deny Brexit. The latest polling has Nigel Farage’s Brexit party pulling from all parts of the British electorate to become the dominant party heading into the polls in three weeks.
If this keeps up he’ll completely change the face of British politics and all of this EU inevitability will dissipate like a fart in a hurricane of populist anger.
Lastly, don’t think that Trump will not put as much pressure as he can on these people. Barr has already begun the process going after Nellie Ohr. There is a possibility we’ll see Trump actually get a few scalps here.
And that may include telling Sheldon Adelson to get stuffed and begin reversing course on the insane levels of aggression emanating from the White House.
There comes a point when you look around and realize something isn’t working. None of the people I’ve talked about here can or will admit that they’ve failed. They are politicians, they can’t show weakness.
Trump has the opportunity here to use all of this to his egregious advantage. While the Democrats lose their collective minds Trump took a long phone call with Russian President Vladimir Putin and immediately made it public.
Embarrassing him and the U.S. the way John Bolton and Mike Pompeo did this week with Operation Bay of Fat Pigs will not sit well with Trump. He’s been asked to sell a policy it doesn’t look like he believes in.
Trump is in re-election mode now. And Venezuelan regime change is not a winning strategy, neither is letting RussiaGate go. The key for him now is to undo a lot of the damage that’s been done by his staff, disloyal cabinet members and recalcitrant bureaucracy who are all wedded deeply to the old way things are done.
Those old ways aren’t working anymore. And if any of these people want to remain in power and pass it along to the next generation they better start acting like the humanitarians they purport to be. That means giving the people what they want — Hillary Clinton’s head on a pike, Brexit, and an end to the creeping technocratic totalitarianism outsourced to Google, Facebook, Twitter and Apple to get around the Constitution.
Houses divided into as many factions as we see all across the west will not stand. They not only invite the crises on our horizon they accelerate them.
The Fed loves to tell us how necessary and vital inflation is for economic prosperity, but in the case of midtown Manhattan’s “prime” retail real estate, it is doing nothing but helping cause once extremely prominent shopping areas to become the very same “ghost towns” they turned into during the 2008 housing crisis. Mayor DeBlasio’s asinine solution to this issue created in part by faulty government policy? More government and more regulation. So much for the recovery.
As if brick and mortar retail didn’t have enough problems to deal with being methodically decimated by the ever growing behemoth that is Amazon, store owners are now facing rent that is simply so high that it makes it prohibitive for them to open retail shops and do business in once prominent areas of downtown Manhattan.
If you want to see the future of storefront retailing, walk nine blocks along Broadway from 57th to 48th Street and count the stores.
The total number comes to precisely one — a tiny shop to buy drones.
That’s right: On a nine-block stretch of what’s arguably the world’s most famous avenue, steps south of the bustling Time Warner Center and the planned new Nordstrom department store, lies a shopping wasteland.
It shouldn’t come as a surprise to anybody that Amazon and other online retailers have had a profoundly negative effect on traditional brick-and-mortar retailers. This is the narrative that has been playing out for the last couple of years as we have watched retail stocks like Sears, JCPenney and Macy’s get destroyed while online shopping names have performed extraordinarily well.
But what may come as a surprise to some is the fact that the constant need to keep prices of real estate and rent rising, regardless of traditional supply and demand, is exacerbating things to a degree where some of the most sought after real estate in the world has now become deserted and barren. The article continued:
The same crisis blights the rest of Manhattan. The people invested in storefront retailing — real-estate developers, landlords and retail companies themselves — tell us not to worry. It’s a “transitional” situation that will right itself over time. Authoritative-sounding surveys by real-estate and retail companies claim that Manhattan’s overall vacancy is only just 10 percent.
But they are all wrong. Bricks-and-mortar retail is shrinking so swiftly and on such a wide scale, it’s going to require big changes in how we plan our new buildings and our cities — although nobody wants to admit it.
…
And yet, it’s scary to think that one of the city’s great pleasures, window-shopping — which also ensures vibrant, crime-deterring sidewalk life — will become a thing of the past except at certain locations.
At this rate, we face a future where streets will be mostly dark at sidewalk level for miles on end. Third Avenue in the East 60s, Broadway north of Lincoln Center, many blocks in the supposedly thriving Meatpacking District are halfway there already.
What is Mayor DeBlasio’s solution to the problem of rising rents as a result of government policy? More government, of course! He wants to actually fine landlords who keep spaces empty until they fine tenants. Talk about the blind leading the blind:
Few retailers can afford to pay more than $250 per square foot annually in rent — yet landlords persist in asking $400 a square foot and up to $2,000 a square foot in prime zones like Fifth Avenue and Times Square.
Mayor de Blasio wants to fine landlords who keep spaces empty until they find tenants who’ll pay astronomical rents. But there’s no fair way to judge who’s actually guilty. Would he punish the owners of the small corner building at 1330 Third Ave. at East 76th Street, who slashed the “ask” from $420,000 a year in 2016 to $360,000 in April 2017 and still can’t find a tenant?
Of course, this really comes as no surprise to us, because in late March of this year we recalled our own 2009 tour of Madison Avenue to discover that it also had turned into a ghost town. Just a week ago we told our readers that the ghost town that was New York’s “Golden Mile” was not surprising: after all the US economy had just been hit with the worst recession since the Great Depression, and only an emergency liquidity injection of trillions of dollars prevented a global financial collapse.
What is more surprising is why nearly 9 years later, at a time of what is supposed to be a coordinated global recovery, a walk along Madison Avenue reveals the exact same picture.
And aside from us and the New York Post, Starbucks CEO Howard Schultz also noticed the disturbing trend, stating at the company’s Annual General Meeting:
Now, as a result of what we’re witnessing, we’re also seeing something else and that is, there is a proliferation around the country right now of empty storefronts. We took a walk in New York two weeks ago from 59th street to 79th on Madison Avenue, and we lost count of how many empty storefronts there were in Manhattan. It reminded me of the cataclysmic financial crisis in 2008. But what’s happening is very simple, the rent structures for the last 5 to 10 years, have been rising at historic rates and retailers do not have the amount of customers they had during these last 5 to 10 years and could no longer economically survive.
So they’re closing stores and as a result of this, I can promise you just like I predicted in 2014 that rents are coming down and landlords are going to have to get religion, or else their stores are going to stay empty. And we’re already beginning to see a different level of reception in terms of what we believe the cost of occupancy should be. And this is going to bode extremely well, specifically for us. We’re adding almost 700 new Starbucks stores a year. And so we are going to take full advantage of the economic reality of this situation. And as we go forward two, three, four, five years out even though labor is going up in terms of cost of labor, we believe rents are going down and the economic model of Starbucks is going to be enhanced as a result of this macro situation. And we’re just at the beginning of this trend.
So the hilarious irony of Keynesian theory once again rears its ugly head as New York’s current retail apocalypse and prime real estate exodus has, in effect, caused some of the most traversed city streets to look like they did during the financial crisis of 2008 once again.
This is the result of what happens when you engineer a recovery, instead of letting the free-market recover on its own: you get a recovery that isn’t really recovery. The Fed and the media have always been able to duck behind the outperforming stock market as a false indicator of the health of the economy as a “scorecard” for the recovery. But with the market now topping out and reaching levels of significant volatility, and the March jobs number handily missing expectations, how can the Fed justify that their policy continues to make sense when it is putting a good portion of Manhattan into the very same shackles and chains it was in during the crisis we are “recovering” from 10 years ago?
via ZeroHedge News http://bit.ly/2Ye8ruh Tyler Durden
The attorney general’s testimony was clearly accurate…
I originally thought this was too stupid to write about. But stupid is like the plague inside the Beltway — one person catches it and next thing you know there’s an outbreak at MSNBC and the speaker of the House is showing symptoms while her delirious minions tote ceramic chickens around Capitol Hill.
So I give you: the Bill Barr perjury allegation.
We are all entitled to our own opinions. But are we entitled to our own facts? Daniel Patrick Moynihan’s bon mot says no, but Washington makes you wonder. Like when spleen-venting about the supposedly outrageous, unbelievable, disgraceful invocation of the word “spy” to describe episodes of government spying is instantly followed by a New York Times story about how the spying — er, I mean, court-authorized electronic surveillance — coupled with the tasking of spies — er, undercover agents — green-lighted by a foreign spy — er, intelligence service — was more widespread than previously known.
If I were a cynic, I’d think people were trying to get out in front of some embarrassing revelations on the horizon. I might even be tempted to speculate that progressives were trotting out their “Destroy Ken Starr” template for Barr deployment (which, I suppose, means that 20 years from now we’ll be reading about what a straight-arrow Barr was compared to whomever Democrats are savaging at that point).
The claim that Barr gave false testimony is frivolous. That is why, at least initially, Democrats and their media echo chamber soft-pedaled it — with such dishonorable exceptions as Mazie Horono, the Hawaii Democrat who, somehow, is a United States senator. It’s tough to make the perjury argument without any false or even inaccurate statements — though my Fox News colleague Andrew Napolitano did give it the old college try. As recounted by The Hill, he twisted himself into a pretzel, observing — try to follow this — that the attorney general “probably misled” Congress and thus “he’s got a problem” . . . although this purported dissembling didn’t really seem to be, you know, an actual “lie” so . . . maybe it’s not a problem after all. Or something.
I assume that in his black-robe days, Judge Nap would have known better. When meritless perjury cases are thrown out of court, judges are often at pains to explain that the questioner who elicited the purportedly false testimony bears the burden of clarity; the terms of the question dictate the evaluation of the answer. In this instance, Barr’s April 9 testimony before the House Appropriations Committee was true and accurate; if a misimpression set in after, it is because the relevant questioning by Representative Charlie Crist (D., Fla.) has been ignored or distorted.
Moreover, because perjury is a serious felony allegation, judges and legal analysts never rely on a general, selectively couched description of the testimony — much less on the likes of Speaker Nancy Pelosi’s because-I-said-so refrain that Barr “lied to Congress” and “that’s a crime.” The testimony must be examined, with emphasis on the words that were used (the questions as well as the responses), and anything we can glean about the witness’s demeanor (stingy? dodgy? forthcoming?).
The mindless, no-need-to-check-the-record allegation against Barr goes like this: The AG testified on April 9 that he had no idea why Special Counsel Mueller was upset over the way Barr’s March 24 letter described Mueller’s report; but, in fact, Barr knew exactly why Mueller was upset because he had received the latter’s March 27 letter complaining about Barr’s missive.
Now, here is the exchange on which the perjury allegation is based, with my italics highlighting key portions:
CRIST: Reports have emerged recently, General, that members of the special counsel’s teamare frustrated at some level with the limited information included in your March 24th letter . . . that it does not adequately or accurately necessarily portray the report’s findings. Do you know what they’re referencing with that?
BARR: No, I don’t. I think — I think . . . I suspect that they probably wanted more put out, but, in my view, I was not interested in putting out summaries or trying to summarize because I think any summary, regardless of who prepares it, not only runs the risk of, you know, being under-inclusive or over-inclusive, but also, you know, would trigger a lot of discussion and analysis that really should await everything coming out at once. So I was not interested in a summary of the report. . . . I felt that I should state the bottom line conclusions and I tried to use Special Counsel Mueller’s own language in doing that.
When we look at the actual words of this exchange, Barr’s testimony is clearly accurate. And I don’t mean accurate in the hyper-technical, Clintonesque “depends on what the definition of is is” sense. I mean straightforward, unguarded, and evincing a willingness to volunteer information beyond what the question sought.
Crist did not ask a general question about Mueller’s reaction to Barr’s letter; he asked a specific question about the reaction of Mueller’s “team” to the Barr letter’s description of “the report’s findings.” Regarding the March 24 letter’s rendering of this bottom line — namely, Russia meddled, Trump did not collude, and Mueller failed to resolve the obstruction question — Barr said he did not know what Mueller’s staff was complaining about.
Barr has known Mueller for nearly 30 years; when Mueller was the Criminal Division chief in the Bush 41 Justice Department, he reported to Barr, who was attorney general. It should come as no surprise, then, that Barr was not getting his information from Mueller’s staff; he was getting it from Mueller directly. Nor should it come as any surprise that, before releasing his March 24 letter to the public, Barr gave Mueller an opportunity to review it; nor that Mueller declined that opportunity — given that he knows Barr well, and knew Barr would not misrepresent the report (especially given that the report would soon be public).
Three days after Barr announced the report’s conclusions, Mueller sent his letter, undoubtedly written by his staff. Mueller could simply have called Barr on the phone, as he has done a million times; but the staff’s partisan Democrats wanted a letter, which makes for much better leak material.(The letter was, in fact, strategically leaked to the Washington Post Tuesday night, right before Barr’s Wednesday morning Senate testimony.) The day after receiving Mueller’s March 27 letter, Barr called Mueller and pointedly asked whether he was claiming that Barr’s March 24 letter articulating Mueller’s findings was inaccurate. Mueller responded that he was making no such claim — he was, instead, irritated by the press coverage of Barr’s letter. Mueller suggested the publication of additional information from the report, including the report’s own executive summaries, to explain more about why he decided not to resolve the obstruction issue. But he did not claim Barr had misrepresented his findings. (See Barr’s Senate testimony, starting at 39-minute mark.)
Again, Barr’s contact was with Mueller, not Mueller’s team. His exchanges with Mueller gave Barr no basis to know about any objection to his description of the report’s findings — from Mueller or anyone else. The fact that Mueller’s staff was leaking like a sieve to the Times, the Washington Post, and NBC News does not mean they were sharing with the attorney general what the Times described as “their simmering frustrations.”
That is what Barr said in answer to Crist’s question about the report’s findings. But to avoid the misimpression that he was parsing words deceptively, Barr volunteered his perception that Mueller’s staff wanted more information from the report to be publicized. That was consistent with what can be inferred from Barr’s phone call with Mueller on March 28. And it was not news: Crist’s questions were based on the aforementioned press accounts of leaks from Mueller’s staffers. They were irked at the bad press they were receiving over Mueller’s abdication on the question whether there was a prosecutable obstruction case, and they had groused that there was much more to their report than Barr’s letter conveyed. Of course, Barr never disputed this; as he repeatedly explained, he undertook to render the conclusions, not summarize the entire 448-page report.
Barr decided that his way of making disclosure — the findings followed three weeks later by the full report — was superior to the proposal of Mueller’s staff that their own summaries be released. You can disagree with Barr on that, but that’s not grounds for a perjury claim. And it raises a point Barr made in his Senate testimony: The regulations do not require any disclosure of the special counsel’s report (which is supposed to be a confidential Justice Department document, as is typical of Justice Department deliberations over whether to charge or decline to charge). The decision of what, if anything, to disclose, and how that should be done, is exclusively the attorney general’s, not the special counsel’s. Mueller’s job was to make a prosecutorial judgment — to charge or decline to charge obstruction. Mueller failed to do that. Since Mueller didn’t do his own job, isn’t it a bit presumptuous of his staff (through press leaks) to tell Barr how to do his?
Could what happened here be more obvious?
Mueller received fawning press for two years on the expectation that he would slay Trump. Then, on March 24, Democrats and the media learned not only that there was no collusion case (which was no surprise) but that Mueller had been derelict, failing to render a judgment on the only question he was arguably needed to resolve: Was there enough evidence to charge obstruction? Journalists proceeded to turn on their erstwhile hero. This sent him reeling, and it brought to full boil the anger of Mueller staffers, who wanted to charge Trump with obstruction based on the creative (i.e., wayward) theory they had been pursuing — namely, that a president can be indicted for obstruction based on the exercise of his constitutional prerogatives if prosecutors (including prosecutors who are active supporters of the president’s political opposition) decide he had corrupt intent. The staffers put their pique in a letter that could be leaked, and Mueller was sufficiently irked by the bad press that he signed it. And now Democrats are using the letter as the launch-pad for The Big Lie that Barr lied, calculating that if they say it enough times, and their media collaborators uncritically broadcast these declarations, no one will notice that they never actually refer to the transcript of what they claim is the false testimony.
Democrats are unnerved. Attorney General Barr is pursuing an inquiry into the Obama administration’s decision to conduct a foreign counterintelligence investigation of the Trump campaign. The time is now, they figure, to reprise the Ken Starr treatment: the ad hominem withering of an accomplished, highly capable official — in this instance, one who is daring to press questions that would have been answered two years ago if an incumbent Republican administration had spied on — er, monitored — a Democratic presidential campaign.
via ZeroHedge News http://bit.ly/2ZVgnC5 Tyler Durden
Sri Lanka has expelled more than 600 foreign nationals, including approximately 200 Islamic clerics since the Easter suicide bombings at three churches and three luxury hotels that killed 257 people and wounded nearly 500.
The attacks were led by a local Islamic cleric known to have traveled to India where he made contact with jihadis.
Home Affairs Minister Vajira Abeywardena said the clerics had entered the country legally, but amid a security crackdown after the attacks were found to have overstayed their visas, for which fines were imposed and they were expelled from the island. –Daily Mirror
“Considering the current situation in the country, we have reviewed the visas system and took a decision to tighten visa restrictions for religious teachers,” said Abeywardena, adding “Out of those who were sent out, about 200 were Islamic preachers.”
Police said that many of those expelled include foreigners from Bangladesh, India, Pakistan and Maldives who have overstayed their visas.
“There are religious institutions which have been getting down foreign preachers for decades,” Abeywardena said. “We have no issues with them, but there are some which mushroomed recently. We will pay more attention to them.”
Sri Lanka is overhauling the country’s visa police in the wake of the attacks, as authorities now fear that foreign clerics might radicalize locals for future attacks. A state of emergency was imposed after the attacks which give wide powers to police and troops in order to arrest and detain suspects for extended periods.
Authorities have been conducting house-to-house searches for explosives and radical Islamic propaganda.
Late last month, security forces exchanged gunfire in a battle with terrorists holed up in an Islamic State safe-house in the Muslim-majority town of Sainthamarudu in Sri Lanka’s Eastern Province after they were tipped off by a local Imam, according to BDNews24.
In a gun battle between the security forces and terrorists holed up in a van and the safe house, and following three explosions triggered by the holed-up terrorists on Friday night, 15 people, including six men, six women, and three children, were killed.
Two suspected terrorists, believed to be suicide bombers, have decamped and a hunt is on for them, police said.
The safe house in question was taken on rent by the followers of a Tawheed Jamaat led by Mohammed Zahran Hashim, who was influenced by the Islamic State.
Zahran was one of the suicide bombers who died in the Easter Sunday attacks on churches and hotels in Colombo. –BDNews24
Troops in the nearby town of Nintavur reportedly found an unregistered van belonging to Zahran’s brother-in-law, Niyas – while IS flags, literature and other objects were found during a raid last week in the Sammanthurai region. According to a Sri Lankan military spokesman, Brigadier Sumith Atapattu, combined troops also recovered explosives, detonators, gelignite sticks, acid bottles, suicide kits and military uniforms from the safe house.
Meanwhile, in Erakandy in Trincomalee district, police have arrested a person with 51 water gel explosive sticks and 215 detonators. In Colombo, ruling United National Party Municipal Councillor Noordeen Mohamad Thajuddeen has been arrested for possessing 46 swords. –BDNews24
Local Muslims report that they have opposed extremism:
According to the report, “The Muslims here, including the local mosque head, had completely rejected the extremist propaganda which Zahran’s group had been indulging in since 2017. Local people, including their social leaders and clerics, had complained about the Zahran group’s propaganda that non-Muslims have to be exterminated and that those dying in fights against Kafirs, would go straight to heaven,” said HM Ameer, head of the Abdul Jawad Ali Waliullah Trust.
“People had participated in demonstrations against the Zahran’s Tawheed Jamaat and its propaganda. I, along with 12 others, had filed a case against Zahran seeking a ban on his activities in 2017. I had met Ministry of Defence officials in Colombo with recordings of Zahran’s speeches and the literature he had produced. But all to no avail,” he added.
Of note, approximately 10% of Sri Lanka’s population practices Islam, while 70% of the country is Buddhist, as of 2011.
Rifthi Ali, a freelance journalist now in Sammanthurai said that local people are livid with Zahran’s men for taking a house on rent and working against the interest of the landlord and the entire area.
“Muslims of Sri Lanka consider Zahran and his ilk to be fit to be driven out of Sri Lanka. If there was not such a feeling of discomfort with him, neighbours of the safe house and the local mosque head would not have told the police about the house and its occupants,” Ameer added.
Mohamed Shoib, a political commentator and a media advisor to Commerce Minister Rishad Bathiudeen, said that as recently as Jan 3 this year, the All Ceylon Jamiaythul Ulema (ACJU) had complained to the defence ministry about the activities of Zahran’s Tawheed Jamaat, through the good offices of the Governor of the Western Province, Asad Sally. But again to no avail he regretted. –BDNews24
According to Shoib, 99% opf Sri Lankan Muslims are “resolutely opposed to terrorism.”
via ZeroHedge News http://bit.ly/302GHdR Tyler Durden
You might be wondering why the Trump Administration is calling for rate cuts and money printing with all the good news about the economy.
Economist John Williams of ShadowStats.com knows why and contends,
“We have a recession in place. It’s just a matter of playing out in some of these other funny numbers. The reality is on the downside, where you have mixed pressures right now. People who are really concerned about the economy right now, and that includes President Trump looking at re-election, he’s been arguing that the Fed should lower rates, and I am with him. The Fed created this circumstance. They are pushing for the economy on the upside because they want to continue to keep raising rates. Banks make more money with higher rates, and they are still trying to liquidate the problems they created when they bailed out the banking system back in 2008.”
Williams strips out all the financial gimmicks in his work that make things look better than they really are to give a true picture of the real financial health. Take for example the recent reportedly good news of the trade deficit narrowing. Williams says,
“What we saw was the very unusual narrowing of the deficit . . . that’s generally good news . . . but if you look at why the trade deficit was narrowing, it wasn’t that we were having new surging exports . . . instead, we were having collapsing domestic consumption. People weren’t buying things. People were not buying goods. So, the imports were falling off, and that narrowed the deficit. That is not a healthy sign. The last time you saw something like that was the beginning of the Great Recession (2008–2009). . . . We still haven’t recovered from the Great Recession.”
If rate cuts don’t happen soon, is the economy going to tank? Williams says,
“The economy is tanking, and I’ll contend it already has, although we have not seen it in the GDP reporting. . . . The ultimate thing here is you have a collapse in the dollar. I am talking about a hyperinflationary collapse. Your purchasing power becomes worthless. What you have in gold or canned goods or real estate, that will be your assets – hard assets.”
In closing, Williams says, “The underlying weakness is with the consumer…”
“Until the consumer gets turned around, you are not going to get a fundamental change in the economy. The economy is going to get weaker. The Fed is going to recognize that, and they probably already do recognize that. . . . They don’t want to lower rates, but I think they are going to have to. I would look for easing by September and maybe quantitative easing (money printing) as the economy continues to deteriorate as it seems to be doing. I know the numbers are not there yet in the headlines, but watch out.”
Join Greg Hunter as he goes One-on-One with economist John Williams, founder of ShadowStats.com.
