Category: zerohedge

Authored by Alt-Market’s Brandon Smith, via TheBurningPlatform.com,

Global stock markets and some treasury markets have become a rather spectacular farce over the past ten years, so much so that there are many people in the investment world that actually believe the long running bull market rally will “never end”. My view of stock markets has always been the same – they are an economic placebo; a psychological crutch that is exploited by central banks and governments to dupe the public into thinking our financial system is stable, even while the rest of the economy is in steep decline.

Stock markets are one false indicator, among a few (such as rigged GDP numbers, rigged inflation, as well as rigged unemployment stats), which keep the masses in the dark… at least, for a while. In every bubble in modern history, there comes a moment in time when central banks are either forced to let the fraud collapse, or, they deliberately allow the fraud to collapse. Banks and countries can only fake a recovery for so long, and very often, global elitists gain political and social advantages by simply letting the system crash for a time.

Central banks started out working in tandem in 2009 to bring about a reversal of the global debt and derivatives crisis. The calculated and close cooperation in policy initiatives between central banks that were supposed to be politically and economically opposed to each other proved what many of us had long suspected; that global economic management was indeed real, and that the likely source was the Bank for International Settlements (BIS). This fact had been exposed by journalists before, and even openly admitted to on occasion by banking moguls, but to see it in action was something else entirely.

After the Federal Reserve began the taper of QE, other central banks around the world started picking up some of the slack. Obviously, the Fed had the world reserve currency at its disposal, making it the premier market manipulator, but as it backed away from this role (and it is backing away despite what some in the alternative media believe), the EU, Japanese and Chinese central banks have continued to stimulate and keep markets afloat.

This all came to an abrupt stop in December of last year. Markets were greeted with the unsettling prospect that the Fed was not going to back off of its policy tightening, and that interest rates were going to meet the Fed’s neutral rate of inflation. They were also greeted with the reality that the Fed was going to continue cutting its balance sheet at an accelerated pace, thus removing liquidity from markets now addicted to artificial stimulus and dollar flow. This was going to eventually kill the primary source of the stock rally, which was corporate stock buybacks; a legal form of market manipulation fueled by easy debt from central banks.

The party was ending, and stocks began to tank.

But, as with every other market crash of the past century, massive bounces are inevitable. The farce was not quite over yet. While the Fed added a few calming words to its rhetoric, its tightening policies did not change. If there was a “plunge protection team”, the Fed was not a part of it. Plunge protection came from a rather surprising source the past four months, namely China.

The global stock plunge pulled a 180 degree turnaround in January of this year at the same moment China announced reinvigorated stimulus measures. This stimulus was also initiated at the same time as talk of a “trade deal” began to hit the mainstream media, giving hope that the long trade war was about to end instead of becoming worse. Global markets loved the move by China, and rallied around their QE measures, which have continued unabated into the second quarter of 2019.

I would also note that anytime there has been discussion in the mainstream of China backing away from its stimulus policy, stocks suffered a negative reaction. The reality is, when China stops its current burst of QE, stock markets have nothing left to hang onto in terms of optimism or liquidity. And, in the past couple of weeks it has become clear that China is likely to cut off the fun-money soon.

At the end of April, Chinese banking officials hinted that accommodation would be restricted, perhaps by the end of May. This makes sense, as the stimulus boosted Chinese stats, but has recently been producing diminishing returns. Another factor, the obvious elephant in the room, is the renewed hostilities in the trade war.

I have been warning for months that the trade war between China and the U.S. is Kabuki theater, an elaborate distraction by governments and central banks designed to keep the masses occupied. It is also a perfect scapegoat for the current crash in economic fundamentals (which I covered in detail recently), as well as the eventual crash in stocks. When the “Everything Bubble” fully implodes, central bankers, the engineers of the bubble, must have an adequate scapegoat in place so that they do not take the blame. The effects will be global, and ugly. The banks prefer not to be seen as the villains, but as our saviors, heroically leaping to our rescue after we have sufficiently suffered an economic breakdown.

The reason for China’s intervention in markets could be explained a number of ways.

First, people might say that China was protecting itself, and its stimulus had the unintended effect of boosting the stock markets of other countries, even the U.S. I’m not buying that. Central banks know full well how each policy measure will help or harm markets.

Another explanation is that China offered to step in to calm market sentiment as a sign of good faith during trade negotiations with the U.S. But, if that is the case, then you would think that the Trump Administration, which has chained itself directly to the performance of U.S. stocks, would be less inclined to aggravate the situation by launching 25% tariffs on hundreds of billions of dollars in Chinese goods.

My position, as the evidence supports, is that because China is so closely tied to the IMF and BIS, just as the U.S. is tied to the IMF and BIS, it was simply China’s turn to prop up markets until those who are in favor of globalism decided it was time to pull the plug again. The trade war itself remains a coordinated theater. It is not real and is not meant to be “won”. It is meant to go on, and any “deal” that happens to be constructed will be highly temporary and designed to eventually fail.

The trade war only serves one purpose: To keep central banks and those that run them in the clear as the current crash continues. This is why the trend of conservatives jumping on the trade war band wagon is dangerous. I, for one, would not recommend anyone attach themselves to this theater in the expectation that Trump and the U.S. will come out on top. Either no one wins this, or China wins this, and conservatives are being set up for an epic fall should they rally around a trade war in which there is no plan or intention for victory.

For now, the details on China’s response to the trade crisis are unclear. China is continuing forward with a planned meeting in the U.S., but this too may simply be a grand show with little substance. I suspect that the most affecting changed to the financial environment will remain most unannounced. I predict China will cut off stimulus measures entirely, and that the investment world will not be very happy about it.

The timing of these events is interesting, if not highly coincidental. The Fed just dumped almost $40 billion in the week before Trump suddenly announced a huge leap in trade hostilities. This once again supports my theory that the trade war is an engineered theater to distract from central bank activities. Also, in the same week Powell and others at the Fed have made decidedly “hawkish” statements compared to their rhetoric since January. The week before all of this, China hinted that their own stimulus measures were about to be tapered. And, as I write this, a U.S. naval battle group is heading to Iran as a “show of force”, as rumors spread that Iran plans to “strike U.S. interests” in the Gulf and John Bolton threatens “unrelenting force”.

The situation is not stable, to say the least. And without a high level of stimulus coming from a major central bank somewhere in the world, the Everything Bubble has nothing left to cling to.

*  *  *

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via ZeroHedge News http://bit.ly/2Lygmkp Tyler Durden

For years, we have commented on the Swedish government and the Riksbank pushing for a “cashless society.”

The Riksbank has over 1,000 articles posted on its website on the “cashless society“. The emphasis worked: between 2013 and 2017, the amount of cash in circulation dropped by 35%, earning Sweden a reputation as the world’s “most cashless nation”:

Many of Sweden’s bank branches had stopped handling cash altogether.

Figures from the Royal Institute of Technology in Stockholm show that only 18% of all payments made today in Sweden are in cash – a 15% drop from the previous year. Meanwhile figures from the Swedish Trade Federation show that most Swedish retailers say that 80% of their commerce is from card payments. A number that probably will be 90% by 2020. Such is the appetite for digital commerce in Sweden that many predicted it could become the world’s first cashless society.

But, now, as The Daily Mail reports,  The Swedish Civil Contingencies Agency, an arm of the government, has sent guidance to every home telling residents to squirrel away “cash in small denominations” in case of emergencies ranging from power cuts or technology glitches to terrorism, cyber-attacks by a rogue government or war.

Riksbank, the country’s central bank, last week called for an inquiry into the risks posed by a future cashless society.

Officials told parliament that hard cash was important “not just in times of crisis and war, but also in peacetime.”

In December, Britain’s Access to Cash Review warned that Britain too was ‘sleepwalking into a cashless society’, the Daily Mail reported.

Chair Natalie Ceeney said, “If we don’t take action now in this country, we’re only a couple of years away from Sweden.”

“Sweden’s big message to us is, ‘Plan now before you get into a mess’.” Sweden hit its crisis when its equivalent of the NHS declared it was going cashless.”

As the age of NIRP “gradually” comes to a close, much of the excitement about ushering in a cashless nirvana appears to be fading with it. Following on the heels of comments by senior ECB board members in defense of cashas well as an open admission by the European Commission that physical cash is perhaps not quite the source of all evil, the Riksbank’s decision to safeguard the role of cash in the financial economy is the biggest sign yet that Europe is giving up on its war on cash, and is instead allowing people switch to cashless payments systems at their own pace, however long that may take. 

But now that the world’s bankers are pivoting back to their dovish stance, how long before the return to NIRP (or ZIRP in the US) prompts a renwed war on cash?

via ZeroHedge News http://bit.ly/2VfxMSq Tyler Durden

Authored by George Pickering via The Mises Institute,

Of all the many failures of Theresa May’s management of Brexit so far, none is so symbolic as the fact that the UK is currently preparing to participate in EU Parliament elections on May 23rd, even though Britain was originally scheduled to leave the European Union in March. This very public symbol of the failure of May’s Brexit strategy — to which she agreed as a condition of the current ‘flexible extension’ of the UK’s EU membership until at least October 31st — has not only caused a near-total breakdown of support for May’s leadership from within her own party, but has also led to a widespread surge of public interest in third parties.

Most notably, Nigel Farage has emerged from dormancy to become the leader of the newly-formed ‘Brexit Party’, which has shocked pundits by surging to first place in the pre-election polling. One recent poll indicates that as much as 30% of the British public intends to vote for the Brexit Party in the upcoming EU elections, fully 9% ahead of their closest rival, and over 20% ahead of the new pro-EU party ‘Change UK’, which was formed at around the same time as the Brexit Party and received equivalent if not greater media attention.

This fracturing of Britain’s usual two-party paradigm is certainly a welcome trend, especially given the Brexit Party’s explicit support for a ‘hard’, no-deal Brexit, which I have argued in previous Mises Wire articles would be the least-worst option. However, if the Brexit party do receive as much of the final vote as the polls are predicting, it will likely re-spark the public debate about the benefits and drawbacks of a no-deal Brexit, and when that debate arrives it will be important for no-deal advocates to have their argument straight about what those benefits and drawbacks are.

While it might be tempting to portray no-deal as an unambiguously positive scenario, the reality is that an institutional disruption of that kind will not be without its difficulties, and no-deal advocates might appear discredited if they attempt to deny or ignore these. The important point which no-deal advocates should understand before crafting their arguments is that, even though there probably will be some negative consequences of a no-deal Brexit, those negative consequences would exclusively be penalties and restrictions arbitrarily inflicted by governments, rather than inherent problems with Brexit per se.

For a concrete example, one need look no further than arguably the central issue of the Brexit negotiations: tariffs. The European Union is defined by the punitively-high trade wall erected around its borders, which inflicts all manner of taxes and restrictions on imports and exports to and from the bloc. When Britain finally does exit the tariff wall, its trade with the rest of the world will certainly be benefitted, allowing a greater number of international goods to be imported and sold at lower prices, and making British goods competitive abroad. However, the other side of the coin is that Britain will now be outside the EU’s wall, and so will have to pay those high tariffs when trading with the EU. While this would admittedly be a downside to a no-deal Brexit, it is important to emphasise that there is no inescapable law of nature which dictates that the EU has to maintain those tariffs, nor is it simply an existential fact of the universe that countries which leave the EU must be excluded from the single market. In other words, yes, the tariffs will inflict economic harm on Britain, but the culprit is the tariffs themselves, not Brexit. If Brexiteers emphasise this fact rather than trying to deny or ignore it, they might not only avoid appearing discredited when the negative consequences do arrive, but also manage to promote public understanding and discussion of this important economic issue.

It would likewise be tempting for Brexiteers to place the blame entirely on policies inflicted by the EU bureaucracy, but the truth is that harmful post-Brexit policies are equally likely to be imposed by the UK’s own government. This is particularly true for the issue of ‘regulatory harmonization’. Although UK policymakers had initially been considering significant deregulation as a possibility in the case of a no-deal Brexit, this option was taken off the table due to Theresa May’s commitment to transpose the bulk of EU regulations into British law. This would mean that, even in the event of a no-deal Brexit, UK consumers would miss out on the economic boost and quality of life improvements that could otherwise have resulted from abandoning burdensome and unnecessary EU regulations. Again however, the key point is that the true culprit is the policy of regulation itself, not Brexit, and Brexiteers should be no less quick to point this out simply because the source of the harmful policy is the UK government, rather than the EU.

Once Brexiteers adopt this shift in perspective, it becomes clear that the vast majority of the difficulties and downsides surrounding Brexit – from the disagreements surrounding the rights of UK citizens living in the EU, to the general economic uncertainty during this negotiation period, and so on – are actually the result of unsound policies, negotiating strategies, and demands being made by the governments involved, rather than inherent flaws in the idea of Brexit itself, or decentralization more broadly.

While some readers might regard this sort of distinction as nit-picking, its significance is that it has the potential to shift Brexiteers away from the hopeless position of trying to argue that a no-deal Brexit would have no downsides, back toward the broader task of pointing out the harmful consequences of EU policies, and of State intervention in general, which is an argument they have a much better chance of winning.

via ZeroHedge News http://bit.ly/2LwlB4d Tyler Durden

The president of Cyprus Nicos Anastasiades has slammed Turkey for its “unprecedented escalation of illegal action” which constitutes a “second invasion” in the eastern Mediterranean, blaming Ankara of illegally drilling inside its exclusive economic zone. 

Cyprus has this week raised the issue in an informal European Council meeting in Sibiu, Romania, with European Council President Donald Tusk planning to make official comments on the matter. EU leaders are also set to consider Cyprus’ allegations during meetings at the end of May and in June, which Cypriots fear could merely be more European lip service on the matter. 

Also on Thursday UK Foreign Secretary Jeremy Hunt also expressed Britain is “concerned by Turkey’s announcement to begin drilling in Cyprus Exclusive Economic Zone,” according to Reuters. “This situation must be deescalated and all parties show restraint,” he said. “Hydrocarbons development should benefit all Cypriots and support a settlement,” the foreign secretary added. 

Both the internationally recognized Greek Cypriot government and Turkey – which occupies northern Cyprus – have overlapping claims of jurisdiction for offshore oil and gas research in the natural gas-rich eastern Mediterranean.

Turkey says it’s adhering to international law, to which Cypriot government spokesman Prodromos Prodromou responded by calling out “Turkey’s blatant and unprecedented violations” of Cyprus’ exclusive zone.

Prodromou said that both Anastasiades’ and European People’s Party leadership “condemn the Turkish intervention (and) call on Turkey to abandon these illegal activities.” Greek Prime Minister Alexis Tsipras added that the crisis was “a European issue and not just a Cypriot one,” adding that “international law cannot be violated.”

Turkish President Recep Tayyip Erdogan has recently been provocatively sending  warships near Cypriot waters in order to ward off foreign competition to oil and gas research, according to Cypriot officials, also seeking to bar Cypriot ships and planes from freely traversing its own European recognized waters. 

But Erdogan is also bumping up against other Mediterranean countries’ plans in the region — at a moment he’s engaged in multiple crises both domestic and related to the West — even as Turkey has long sought EU membership, per Haaretz:

[Turkey] threatens to upset all the plans Israel, Egypt and Cyprus have for exploiting the vast natural gas resources of the Eastern Mediterranean.

The latest installment of the gas crisis started last Friday when Turkey’s foreign minister, Mevlut Cavusoglu, said the Turkish seismic research vessel Barbaros Hayrettin Pasa would be drilling for oil and gas “in areas of Turkey’s continental shelf.”

Turkey has in the past demanded that Cyprus formally recognize the breakaway Turkish Republic of Northern Cyprus (since 1974) and allow it to share revenues from Cypriot gas exploration. 

Furthermore Turkey has laid claim to a waters extending a whopping 200 miles from its coast, brazenly asserting ownership over a swathe of the Mediterranean that even cuts into Greece’s exclusive economic zone. 

Cyprus has also tried to drill exploratory wells in what it and the rest of the world, except Turkey, says is its own maritime zone, but Turkish warships scared off its vessels the last time it tried to do so in February last year. — EU Observer

🇨🇾🇹🇷If true, this is an unacceptable violation of any international rule.
According to the Cyrpus Times, the TDK (the Turkish Navy sends warships with license to fire, to “protect” TPAO drillship executing illegal exploration activity in CY EEZ.
https://t.co/C2qpDlsVkY

— Marco Florian Balkans & EastMed 🇮🇹🇺🇸🇪🇺 (@MarcoFlorianMED) May 8, 2019

Such claims have been condemned by the US, European Union, and Egypt, with NATO officials recently signalling to Turkey that it was out of line. This as Turkish Foreign Minister Mevlut Cavusoglu confirmed last week that “we are starting drilling” in the region.

Should the Turkish military attempt to enforce its drilling claims and run up against Cypriot and Greek vessels, it could spark a deadly encounter which would force the EU and NATO to finally weigh in more forcefully. 

via ZeroHedge News http://bit.ly/2E0U8kP Tyler Durden

Authored by Craig Murray,

Robert Mueller is either a fool, or deeply corrupt. I do not think he is a fool.

I did not comment instantly on the Mueller Report as I was so shocked by it, I have been waiting to see if any other facts come to light in justification. Nothing has. I limit myself here to that area of which I have personal knowledge – the leak of DNC and Podesta emails to Wikileaks. On the wider question of the corrupt Russian 1% having business dealings with the corrupt Western 1%, all I have to say is that if you believe that is limited in the USA by party political boundaries, you are a fool.

On the DNC leak, Mueller started with the prejudice that it was “the Russians” and he deliberately and systematically excluded from evidence anything that contradicted that view.

Mueller, as a matter of determined policy, omitted key steps which any honest investigator would undertake. He did not commission any forensic examination of the DNC servers. He did not interview Bill Binney. He did not interview Julian Assange. His failure to do any of those obvious things renders his report worthless.

There has never been, by any US law enforcement or security service body, a forensic examination of the DNC servers, despite the fact that the claim those servers were hacked is the very heart of the entire investigation. Instead, the security services simply accepted the “evidence” provided by the DNC’s own IT security consultants, Crowdstrike, a company which is politically aligned to the Clintons.

That is precisely the equivalent of the police receiving a phone call saying:

“Hello? My husband has just been murdered. He had a knife in his back with the initials of the Russian man who lives next door engraved on it in Cyrillic script. I have employed a private detective who will send you photos of the body and the knife. No, you don’t need to see either of them.”

There is no honest policeman in the world who would agree to that proposition, and neither would Mueller were he remotely an honest man.

Two facts compound this failure.

The first is the absolutely key word of Bill Binney, former Technical Director of the NSA, the USA’s $14 billion a year surveillance organisation. Bill Binney is an acknowledged world leader in cyber surveillance, and is infinitely more qualified than Crowdstrike. Bill states that the download rates for the “hack” given by Crowdstrike are at a speed – 41 Megabytes per second – that could not even nearly be attained remotely at the location: thus the information must have been downloaded to a local device, eg a memory stick. Binney has further evidence regarding formatting which supports this.

Mueller’s identification of “DC Leaks” and “Guccifer 2.0” as Russian security services is something Mueller attempts to carry off by simple assertion. Mueller shows DNC Leaks to have been the source of other, unclassified emails sent to Wikileaks that had been obtained under a Freedom of Information request and then Mueller simply assumes, with no proof, the same route was used again for the leaked DNC material. His identification of the Guccifer 2.0 persona with Russian agents is so flimsy as to be laughable. Nor is there any evidence of the specific transfer of the leaked DNC emails from Guccifer 2.0 to Wikileaks. Binney asserts that had this happened, the packets would have been instantly identifiable to the NSA.

Bill Binney is not a “deplorable”. He is the former Technical Director of the NSA. Mike Pompeo met him to hear his expertise on precisely this matter. Binney offered to give evidence to Mueller. Yet did Mueller call him as a witness? No. Binney’s voice is entirely unheard in the report.

Mueller’s refusal to call Binney and consider his evidence was not the action of an honest man.

The second vital piece of evidence we have is from Wikileaks Vault 7 release of CIA material, in which the CIA themselves outline their capacity to “false flag” hacks, leaving behind misdirecting clues including scraps of foreign script and language. This is precisely what Crowdstrike claim to have found in the “Russian hacking” operation.

So here we have Mueller omitting the key steps of independent forensic examination of the DNC servers and hearing Bill Binney’s evidence. Yet this was not for lack of time. While deliberately omitting to take any steps to obtain evidence that might disprove the “Russian hacking” story, Mueller had boundless time and energy to waste in wild goose chases after totally non-existent links between Wikileaks and the Trump campaign, including the fiasco of interviewing Roger Stone and Randy Credico.

It is worth remembering that none of the charges against Americans arising from the Mueller inquiry have anything to do with Russian collusion or Trump-Wikileaks collusion, which simply do not exist. The charges all relate to entirely extraneous matters dug up, under the extraordinary US system of “Justice”, to try to blackmail those charged with unrelated crimes turned up by the investigation, into fabricating evidence of Russian collusion. The official term for this process of blackmail is of course “plea-bargaining.”

Mueller has indicted 12 Russians he alleges are the GRU agents responsible for the “hack”. The majority of these turn out to be real people who, ostensibly, have jobs and lives which are nothing to do with the GRU. Mueller was taken aback when, rather than simply being in absentia, a number of them had representation in court to fight the charges. Mueller had to back down and ask for an immediate adjournment as soon as the case opened, while he fought to limit disclosure. His entire energies since on this case have been absorbed in submitting motions to limit disclosure, individual by individual, with the object of ensuring that the accused Russians can be convicted without ever seeing, or being able to reply to, the evidence against them. Which is precisely the same as his attitude to contrary evidence in his Report.

Mueller’s failure to examine the servers or take Binney’s evidence pales into insignificance compared to his attack on Julian Assange. Based on no conclusive evidence, Mueller accuses Assange of receiving the emails from Russia. Most crucially, he did not give Assange any opportunity to answer his accusations. For somebody with Mueller’s background in law enforcement, declaring somebody in effect guilty, without giving them any opportunity to tell their side of the story, is plain evidence of malice.

Inexplicably, for example, the Mueller Report quotes a media report of Assange stating he had “physical proof” the material did not come from Russia, but Mueller simply dismisses this without having made any attempt at all to ask Assange himself.

It is also particularly cowardly as Julian was and is held incommunicado with no opportunity to defend himself. Assange has repeatedly declared the material did not come from the Russian state or from any other state. He was very willing to give evidence to Mueller, which could have been done by video-link, by interview in the Embassy or by written communication. But as with Binney and as with the DNC servers, the entirely corrupt Mueller was unwilling to accept any evidence which might contradict his predetermined narrative.

Mueller’s section headed “The GRU’s Transfer of Stolen Material to Wikileaks” is a ludicrous farrago of internet contacts between Wikileaks and persons not proven to be Russian, transferring material not proven to be the DNC leaks. It too is destroyed by Binney and so pathetic that, having pretended he had proven the case of internet transfer, Mueller then gives the game away by adding “The office cannot rule out that stolen documents were transferred by intermediaries who visited during the summer of 2016”. He names Mr Andrew Muller-Maguhn as a possible courier. Yet again, he did not ask Mr Muller-Maguhn to give evidence. Nor did he ask me, and I might have been able to help him on a few of these points.

To run an “investigation” with a pre-determined idea as to who are the guilty parties, and then to name and condemn those parties in a report, without hearing the testimony of those you are accusing, is a method of proceeding that puts the cowardly and corrupt Mr Mueller beneath contempt.

Mueller gives no evidence whatsoever to back up his simple statement that Seth Rich was not the source of the DNC leak. He accuses Julian Assange of “dissembling” by referring to Seth Rich’s murder. It is an interesting fact that the US security services have shown precisely the same level of interest in examining Seth Rich’s computers that they have shown in examining the DNC servers. It is also interesting that this murder features in a report of historic consequences like that of Mueller, yet has had virtually no serious resource put into finding the killer.

Mueller’s condemnation of Julian Assange for allegedly exploiting the death of Seth Rich, would be infinitely more convincing if the official answer to the question “who murdered Seth Rich?” was not “who cares?”.

*  *  *

Subscriptions to keep Craig’s blog going are gratefully received.

via ZeroHedge News http://bit.ly/3017U0e Tyler Durden

Last week, news emerged that police killings in the state of Rio de Janeiro hit a record high, rising 18 percent in the first three months of 2019.

According to data analyzed by the Associated Press, police officers in Rio killed 434 people over the course of those three months compared to 368 people during the same period in 2018.

As Statista’s Niall McCarthy notes, the rise in killings can be attributed to a zero tolerance policy towards criminals by state leaders, particularly Gov. Wilson Witzel, a former marine and political ally of President Bolsonaro.

You will find more infographics at Statista

Rio’s authorities are known to be the most violent in the world.

Last month, the city made headlines when an army patrol fired more than 80 shots at a car, killing the driver and injuring a passer-by. No weapons were found inside the vehicle and it turned out the driver was on his way to a baby shower.

Even though the police criticized the army for shooting up the car, they themselves killed 1,534 people last year.

Putting that figure into perspective, 992 people were killed by the police across the entire United States in 2018, according to the Washington Post.

via ZeroHedge News http://bit.ly/2VdvOBY Tyler Durden

After much theatrics and 11th hour negotiations, the US more than doubled tariffs to 25% on more than $200 billion in good imports from China just after midnight on Friday in what has been dubbed the “most dramatic step yet” in Donald Trump’s crusade to extract trade concessions from Beijing, deepening a nearly two-year old conflict that has roiled global markets and impacted the world economy.

While the White House said in a statement that talks are set to resume Friday, setting the stage for a tense final day of negotiations between Liu He, China’s vice premier and Robert Lighthizer, the US trade rep, Bloomberg reports that according to “close observers” there is little hope for any meaningful breakthroughs, especially since Liu does not have the authority to make any meaningful commitments, while an alleged phone call between Trump and president Xi yielded no positive results. It was also unclear, Bloomberg adds, whether China had resolved the internal debates that had led to last week’s rescinding of prior commitments to enshrine reforms agreed in Chinese law.

News that the US would hike tariffs, and set off a sequence of events that would most likely result in further escalation pushed US equity futures, treasury yields and the USDJPY lower around midnight.

In response to the tariff hike, China immediately said in a statement it “deeply regrets the latest tariff hike” and that it will be forced to take countermeasures against the US actions, but didn’t specify how, even as it said that it sill hopes the two sides can resolve issues via ongoing consultations.

#China’s full statement on U.S. tariff hikes. Note: no word on what the countermeasures will be. pic.twitter.com/R3oauTVx8T

— Eunice Yoon (@onlyyoontv) May 10, 2019

The tariff hike came after brief discussions between Liu He and his U.S. counterparts in Washington made little progress on Thursday, with the mood around them downbeat, according to people familiar with the talks. The negotiations were due to resume on Friday morning Washington time.

Before the late Thursday talks, Liu told Chinese state media he was coming to Washington “under pressure but with sincerity” and warned that a move to raise tariffs by the U.S. starting Friday was not a solution and would be painful for both China and the U.S.

It was also not exactly clear how China could retaliate, as Beijing can no longer match the U.S. tariffs dollar-for-dollar because they simply don’t buy enough American goods. According to analysts, among Beijing options include:

• Placing tariffs on the remainder of U.S. goods that haven’t been affected yet, or raising existing tariffs (25% is not a ceiling).
• Devaluing the Yuan, either gradually or in one sharp move, similar to what China did in August 2015
• China could also invoke the nuclear option and dump US securities, but that’s been called the mutual assured destruction option for good reason, as it would hurt China’s economy as much as it would impair US asset prices.
• China could also escalate non-tariff barriers, making it difficult for US inspection processes and more painful investment approvals.

Making matters worse, ahead of Thursday’s talks, Trump said the U.S. would go ahead with preparations to impose 25% tariffs on a further $325 billion in goods from China, raising the prospect that all of China’s goods exports to the U.S. – roughly $540 billion last year – would be subject to new import duties.

Curiously, at roughly the same time, Trump sought to clam financial markets after he said it was still possible to reach a deal this week, and noted that he may hold a phone call with his Chinese counterpart, Xi. However, by late Thursday, no call between the two leaders had taken place nor had one been scheduled, according to a senior Trump administration official quoted by Bloomberg.

The market reaction to the new tariffs has been modest because, as previewed earlier by Goldman, there is still a grace period before the sanctions truly impact Chinese goods – they will only affect goods that are shipped after the midnight deadline, and any other goods already in transit will be exempt. This, as Goldman’s Alec Phillips explained, gives the two sides a few more weeks of back and forth discussion to reach some compromise.

The problem, of course, is that it is now that much more difficult for either side to backtrack without losing face, making an amicable resolution over the next fortnight virtually impossible.

Meanwhile, the latest escalation in trade tensions between the U.S. and China, which emerged out of the blue this past Sunday in two Trump tweets, roiled financial markets around the world with investors who had been expecting a deal as recently as a week ago forced to confront a sharp turnaround in expectations. The S&P 500 retreated for a fourth day Thursday, falling into its worst stretch of losses this year.

Paradoxically, to some the escalation in trade war could be positive for asset prices as it would force central banks to become even more dovish: “A U.S. tariff hike on Chinese imports, should it materialize Friday, would hasten and broaden the policy easing cycle in Asia. Those central banks considering a shift to an easing bias would likely be a lot less hesitant in the event of higher tariff barriers” said Chang Shu, Chief Asia Economist at Bloomberg Economics. Earlier today, Peter Schiff suggested that the latest trade war incident is just the excuse Trump needs to force the Fed to either cut rates, or launch QE4, or both.

Responding to the latest developments, Credit Suisse South Asia CIO, Ray Farris, said “Our core view is that a deal is still more likely than not, but that following this tariff rate increase it may take some more time” adding that the “resulting market volatility is likely to provide buying opportunities in U.S. and Chinese equities and credit, but it is probably too early in this process to be confident.” He warned that the “clear risk is that the current U.S.-China talks in Washington end without any resolution and Trump is not able to announce any plans for a conversation with Xi.”

While China has denied the collapse in talks was its fault as the White House has charged, Trump seized on recent strong economic data as a sign that his trade wars are working and may even be boosting growth. Indeed, trade data released Thursday showed the U.S. trade deficit with China decreased to the narrowest in almost three years as imports slowed and exports advanced. Strong GDP and jobs numbers in recent weeks, but most importantly an all time high in the S&P, have also emboldened Trump.

“When people looked at the economic numbers, they were shocked. When they look at the import-export numbers they were shocked,” Trump said Thursday. “Try looking at all of the tariffs that China’s been paying us for the last eight months. Billions and billions of dollars.”

Yet while Trump insists that incremental tariffs will paid for by China most, economists counter that the rising costs will be absorbed by American companies and consumers, resulting in a burst of inflation just as the global economy is slowing rapidly, resulting in what may be the first episode of global stagflation in decades, the worst possible outcome for investors, as central banks will be prevented from intervening in capital markets if inflation is overly hot.

Finally, while it is anyone’s guess what happens next, rating agency Moody’s said that while it believes that a trade deal will eventually be reached between the U.S. and China, “the risk of a complete breakdown in trade talks has certainly increased.”

Higher tariffs by U.S. exacerbates the uncertainty in the global trading environment, further raises tensions between the US and China, negatively affects global sentiment and adds to risk aversion globally, according to Moody’s, which also warned that that the rise in tariffs “ccould also lead globally to the repricing of risk assets, tighter financing conditions, and slower growth.”

And now we await as CNBC pundits will explain how this outcome is the best possible one for stocks.

via ZeroHedge News http://bit.ly/2JvF02y Tyler Durden

Authored by Paul Craig Roberts,

I have been lonely in my concern with the dire economic implications of robotics, but now Clarity Press has provided me with some company by publishing The Artificial Intelligence Contagion by David Barnhizer and Daniel Barnhizer.  It is telling as to the irrelevance of the economics profession that the coauthors are lawyers. 

The concerns about robots and artificial intelligence have come from scientists who express worries about killer robots with super intelligence taking over from dumber humans with less capabilities.  Possibly, but it is more likely that these kind of concerns stem from an incorrect model or understanding of mind, consciousness, and creativity.  I do wish that Michael Polanyi were still with us to give us his take on our proclivity to attribute intelligence to machines.

The coauthors briefly mention these threats as well as the very real and already present  threats from governments armed with the intrusive surveillance and control that the digital revolution and artificial intelligence make possible.  Warnings from Stephen Hawking, Nick Bostrom, and Elon Musk of an immortal godlike superintelligence, amoral at best and immoral at worse, that will determine our fate are speculative, but the adverse economic impact of robotics are already upon us. Thus, the main focus  of the coauthors is on the massive economic dislocation that will result from making people superfluous. 

Recently, I read about a smart machine that displaces warehouse workers and also the workers at the plants that make the mechanical forklift machines that warehouse workers use to move and stack the crates and boxes. As the smart machines themselves are made by robots, the forklift production workers are also displaced.

According to the latest job report, there are 1,192,000 people employed in warehouses. Unlike the forklift, the new smart machine does not contribute to increasing the productivity of labor. Instead the smart machine displaces labor by eliminating the need for people to do the work.  Every dollar that would have been paid in wages goes instead into the profits of the warehouse owners. This is the great difference between earlier innovations that increased human productivity and living standards and the AI robotic innovation that eliminates the need for humans and makes them redundant. 

Robotics will not be implemented everywhere all at once. it will come upon us in stages. The 1.2 million displaced warehouse workers will look for other jobs. The lucky few will find one. The rest will join the unemployment ranks until they become discouraged and are dropped out of the unemployment measure.  State, local, and federal tax revenues will decline as a result of the lost jobs. But unemployment compensation and other social welfare benefits will rise. With constrained or nonexistent incomes, 1.2 million people will have less participation in the retail market. Car sales, home sales, restaurant, clothing, and entertainment sales all decline. The Social Security and Medicare payroll tax revenues decline by the earnings of 1.2 million Americans as do pension contributions. Social Security and Medicare are funded by the current work force paying for the retired work force.  As robotics eliminates the current work force, payroll tax revenues collapse.  

For an unknown period of time, as the US dollar is the world reserve currency, the federal government can print money to fill in the gap in the difference between Social Security and Medicare benefits and payroll revenues.  But large parts of the world (Russia and China) have already been driven away by sanctions from using the US dollar, and this means that the dollar will lose its reserve currency role.  Then what do we do when there are untold millions of Americans expecting Social Security pensions and medical care and there is no work force to pay the payroll tax?

These kind of questions, and there are many more, should be the primary focus of every economist, not that it would do much good as neoliberal economists are indoctrinated beings incapable of thought.  Nevertheless, that there is no concern among economists shows their irrelevance and uselessness.

Many years ago I pointed out that under present law and practice, the entirety of the GDP would flow to the handful of owners of the robotic and AI patents.  There would be no income for anyone else.  Such a situation is not possible, because it would mean that the patents would produce no income for the owners as no one would have jobs and incomes with which to purchase the products of robots and artificial intelligence.  The obvious dilemma I described received no response.

One way of looking at our dilemma is that we need artificial intelligence because those bringing us the AI revolution have no intelligence themselves.  How intelligent is it to make humans useless?  How intelligent is it to have robotic production lines when no humans have incomes from jobs with which to purchase the output of robots?  

Well, you might say, we will make the owners of the robots pay the payroll taxes from their sales revenues. We will guarantee sales by socializing the patents and sending everyone a check for their share of the GDP.  And so on.  

But why?  Why eliminate the need for human labor when no gain can accrue to the elite as there would be no consumer market for their products? The cost savings from robotics and artificial intelligence are meaningless when there are no consumers at the other end. When the patents have to be socialized in order to support a population displaced by robotics, what is the point of the robotics?

The coauthors of Contagion, and that is what artificial intelligence is, understand that humans with their limited awareness and intelligence have found intellectual interests in developing the means for their own self destruction.  Nuclear weapons, for example, are an insane accomplishment of mindless idiots, because they can not enter general use without destroying all life on the planet.  A doomsday weapon is a pointless weapon.

The same for robotics and artificial intelligence.  What is the purpose of producing threats to humans from police states and by taking away all purposes for human  existence?  This is a mindless act.  Those responsible for it are the worst criminals the world has ever known.  Yet these destroyers of humanity bask in public approval for all the benefits they are bringing to mankind.

Read The Artificial Intelligence Contagion and then tell me about the benefits.

via ZeroHedge News http://bit.ly/2E2kD9D Tyler Durden

Australia has become mired in a currency crisis of its own making.

The RBA confirmed Thursday that 46 million new A$50 bank notes have been printed with an embarrassing typo. The “new and improved” notes, which incorporated new technologies to prevent counterfeiting, were rolled out in October.

But the notes also include an unanticipated defect: The word “responsibility” is misspelled in the yellow note’s “micro-text.” The copy editors apparently missed the fact that the second “i” was missing.

The note features the indigenous writer and inventor David Unaipon on one side, and Edith Cowan, the country’s first female member of Parliament, on the other.

The error occurred on Cowan’s side, which included an excerpt from one of her most famous speeches (sexist).

“It is a great responsibilty [sic] to be the only woman here, and I want to emphasise the necessity which exists for other women being here,” the note reads.

A spokeswoman for the RBA has confirmed that the central bank is “aware” of the error, and that it would be corrected in the next run, which means these notes will almost certainly become collector’s items some day.

So “no ragrets,” right?

via ZeroHedge News http://bit.ly/2YjPIgQ Tyler Durden

Authored by Brandon Smith via Alt-Market.com,

In recent months I have been writing extensively about the psychology of globalists as well as the strange cult-like beliefs that drive their philosophies. In my article ‘Global Elitists Are Not Human’ I outlined evidence that globalist motives and behavior are directly comparable to the ideals and behavior of narcissistic sociopaths (or what some people might refer to as psychopaths). I theorized that globalists are in fact a highly organized cult of narcissistic sociopaths, that they look for the inborn character trait of sociopathy in the people that they recruit, and that these people are like a separate species from normal human beings, as they lack most traits that we would associate with normal human behavior such as empathy and self examination.

In my article ‘Luciferianism: A Secular Look At A Destructive Globalist Belief System’, I showcased evidence that globalists and their institutions (like the United Nations) were tied to the luciferian philosophical cult. I also explored my epiphany that luciferianism was actually a religion designed by narcissistic sociopaths for narcissistic sociopaths; a belief system that exonerates and applauds their destructive behaviors.

To reiterate, the only way to understand the methods and madness of globalists is to research and understand the thinking of narcissistic sociopaths. This is, I believe, the big secret that we are not supposed to know about. The root factor that could change the world is if humanity finally realized that these people are not like us – they are a parasitic species which feeds off of us, and they are identifiable if you know what to look for.

Here are a few ground rules to understanding how such predators think and operate:

1) Narcissistic sociopaths make up around 1% to 5% of the total population, and are present in every culture and ethnicity. The vast majority of them carry the traits from birth. Many of them remain latent, meaning, they function within society and avoid destructive behavior because the environment makes this behavior unacceptable. However, at least 1% are full-blown psychopaths.  During times of crisis and uncertainty people with latent traits tend to revert to destructive psychopathic behaviors because there are no social consequences to restrict them.

2) A psychopath is not insane in the manner many people might assume. Psychopaths are highly cognizant of their surroundings, and are adept at manipulating the people around them for their own gain. They know how to blend in, though, even the most skilled chameleons make mistakes and show their true colors  They are also very aware when they are committing an evil act; they simply don’t care and feel no regret or remorse.

3) Psychopaths organize with each other constantly as long as there is a promise of personal gain involved. I’m not sure why, but there is a misconception among many people that all psychopaths are “loners” that do not work with anyone. I can only attribute this belief to mainstream propaganda. The most effective psychopaths hunt in packs. This can easily be seen in criminal enterprises such as cartels, the mob, certain corporate entities that have been exposed, and very often in governments.

I have personally witnessed multiple narc/sociopaths operate together in the same space. These people barely knew each other in some cases, but somehow picked up on instinctual cues and started working together to take over the room and dominate everyone’s attention and time. I have also witnessed narc/sociopaths help each other at random by manipulating a victim or mark back into position so that another narc/sociopath can continue feeding off of them.

Those people who claim that psychopaths could never organize into a conspiracy or cabal because they would sabotage each other have no understanding whatsoever as to how these criminals actually function.

4) Psychopathic people account for the vast majority of violent crime and fraud in the US and consume astonishing resources in terms of taxpayer dollars. There is also NO KNOWN METHOD of rehabilitation for these people. Why? Because narcissism and sociopathy are generally inherent at birth, and they make up the bulk of a psychopath’s personality. Take these two traits away, and the psychopath no longer has a personality. I repeat – these people cannot be fixed. They are what they are and will never change because they have no capacity for self examination and no other personality to fall back on.

5) Psychopaths often have very short attention spans, except when they are engaged in a predatory agenda. This might seem like a contradiction. How could they be so observant of the people around them to the point that they are expert manipulators, while also being oblivious? It is primarily a matter of predatory instinct.

They do not care about normal human associations and interactions if they are not getting fuel for their narcissism from the exchange. They may go through the motions of pretending that they are human, or, they may not. But, if they see an opportunity for gain at the expense of others, they suddenly become hyperfocused and highly industrious.

This is another behavior I have also witnessed personally. I have met narc/sociopaths that were lazy beyond all belief in their daily lives and who had no capacity to listen to other people even when the information might be useful. At the same time, when they saw a target or victim that they could exploit, they would suddenly plan elaborate schemes, spending months of energy building a web of lies and creating a chain of machinations to obtain what they coveted. If you are not familiar with narc/sociopaths, this kind of conduct will come off as extremely bizarre and befuddling.

6) Their lack of attention span in daily circumstances can be partly attributed to their addiction to dopamine. When they do focus, it is only to satisfy a dopamine rush, and the actions that give them the most dopamine rush are usually destructive or aberrant. Of course, over time the actions which gave them dopamine in the past become inadequate, and so they seek out even more aberrant and depraved activities to get the same high. Most narc/sociopaths will willingly engage in the most disturbed and twisted victimization imaginable just to feel a sharper flood of dopamine, as long as they think there will be no consequences.

7) Narc/sociopaths are not necessarily more intelligent or impressive, though they do tend to score higher than average in terms of IQ. They usually do not excel in anything, because they have no patience for mastery of a particular subject or skill. That said, they have a highly developed survival sense, in that they are very good at exploiting the skills of others. Meaning, they are good at manipulating other people who are intelligent and skilled and feeding off of their efforts.

This does not always last, though, as the people they exploit start to realize what is happening and cut the narc/sociopath loose. Most narc/sociopaths will cycle through non-narc associates quickly, and have no real “friends”. In an organized psychopathic group, everything is based on mutual gain and the targeting of victims. They are not friends or compatriots.

8) Narc/sociopaths are invariably cowards, and will rarely fight on a level playing field. They will either run, stab you in the back if they can, or use other people to do their dirty work.

Finally, narc/sociopaths have one particular quirk or obsession which I rarely see discussed, but it is a behavior which I think is central to explaining the methodology of globalists. Narc/sociopaths see themselves as far superior (or godlike) compared to normal people, and they view empathy and the capacity for joy in everyday things as weakness and foolishness. Therefore, they feel justified in their pursuit of dominance and exploitation of others. However, they also understand that they would be considered monstrous by society and face punishment if they are ever exposed.

They know to some extent that they are not human, that they are vampires that need to remain hidden in order to leech off of humans. In their pursuit of dopamine, they have probably engaged in some extremely evil activities, including fraud, corruption, rape, pedophilia or even murder. They don’t personally have any guilt over such actions, but, they know they would be burned at the stake for them.

Being that they see themselves as superior to the rest of us, they find it reprehensible that they should have to hide their true nature. They are “gods” among men, and it is demeaning to them to have to skulk about in the dark, or play act as if they are like us. The final behavior of narc/sociopaths that I want to mention here is their need to either prove that everyone else is just like them, or their need to make everyone else just as monstrous as they are.

I see this in particular with globalists; almost every agenda they engage in has an element of propaganda which encourages people to embrace a morally relativistic philosophy. They want us to engage in atrocities and view them as perfectly acceptable.

This is perhaps the primary rationale behind globalist engineered crisis events. In each instance of crisis, we are told that moral ambiguity is necessary in order to survive, and that empathy and principles are for suckers, or for times of peace only. We are also told that the natural states of human behavior and society are wrong and that we must accept the exact opposite, otherwise we are “bigoted” and are holding society back from progress.

Sure, there is also the elitist goal of convincing the masses to go along with less freedom and more centralization, and this cannot be discounted. But, there is also an underlying and more sought after goal of erasing our humanity altogether. From moral relativism, to digital distraction and our ever shortening attention spans, to the masses being encouraged to chase ever more dopamine, to the demonization of natural masculinity and femininity, to gender dysphoria, to the overt obsession with sexual gratification, to our growing acceptance of government subjugation as long as it is against our political opponents, to the use of war as a means to expand political influence – the globalists are attempting to turn human psychological reality on its head and make us just like them.

The problem for them is, we are not like them. Conscience and empathy are inherent and inborn qualities for us, just as narcissism and sociopathy are inborn qualities for them. We are undeniably different at a fundamental level.  This is why they are forced to construct narratives of reason around the insanity they want us to approve of.  They are forced to present evil actions as if they are for the greater good, because very few people would go along with them otherwise. They have spent the better part of centuries (maybe longer) trying to find ways to undermine our humanity, and have met with constant interference.

I sometimes take comfort in the fact that while the conspiracies of evil are always present and on the attack, they still fail to get what they truly want above all else. While the powers of good are not as visible at times, they are subtle and intricate, and cannot be easily undone.

*  *  *

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via ZeroHedge News http://bit.ly/30bk5aM Tyler Durden