Category: zerohedge

Authored by Steve H. Hanke of The Johns Hopkins University. Follow him on Twitter @Steve_Hanke.

Over this past weekend, the New York Times published reportage, “Taking on Poachers, Kenya Burns Ivory” by Jeffrey Gettleman. Richard Leakey, the noted paleontologist and one of Kenya’s leading conservationists, appeared in that piece, which described a $105 million bonfire fueled by ivory and ignited by Kenya’s President, Uhuru Kenyatta. Leakey indicated that it was a shame to have to burn tons of ivory in an attempt to stop illegal ivory trade.

Well, there is another way. It was reported on in the Weekend Financial Times: “Kenya enlists cattle in struggle to save the elephant” by John Aglionby. In the Loisaba Conservancy, which was founded by Max Graham, a market-based approach to conservation is being developed.

These articles on wildlife conservation in Kenya bring me back to my first encounters with both Leakey and Kenya.

I first met Richard Leakey in the spring of 1972. It was then that the anthropologist Neville Dyson-Hudson, an expert on East African pastoral peoples, and I broke bread with Leakey at the Johns Hopkins Faculty Club in Baltimore. I anticipated plenty of paleontology and anthropology, but those weren’t on the menu. The conversation quickly turned to the topic that most interested Leakey, and as it turns out, the reason why my former colleague Dyson-Hudson had invited me to lunch in the first place: the economics of natural resources.

Leakey had a vision of land use and wildlife resources in East Africa. His observation was that the East African savannahs were, in large part, common property resources. In addition, Leakey noted that the wildlife that roamed over these vast savannahs were fugitive common property resources. He concluded that, unless property rights could be established, both the savannahs and wildlife would eventually be destroyed. For him, this would be a great tragedy, not only for the wildlife, but also the indigenous peoples living off the lands in East Africa.

Leakey questioned whether the current system — burdened with its common property problems and regulated by a very British-type system of hunting rules (charges for hunting licenses and penalties for unlicensed hunting, violations of closed seasons and the killing of protected species) — was sustainable. He also questioned whether parks and game reservations — coupled with restrictions on the trade of wildlife meat, skins and trophies — would actually conserve wildlife. Leakey’s conjecture was that, if property in the savannahs and wildlife resources could be established, they could be properly managed to enhance land-use productivity. This would, he conjectured, give wildlife economic value, save it from destruction, and enhance the economic wellbeing of those indigenous peoples who co-exist among the wildlife herds in East Africa.

Leakey wanted to know what I thought of his ideas. Could good property rights cut down on poaching and corruption, save wildlife and enhance the productivity of East Africa’s savannahs? Could well-managed game cropping, trophy hunting, tourism and so forth, coupled with pastoral herding, generate more prosperity than the current land-use arrangements? And could such a wildlife-oriented economy co-exist with traditional herding? And on-and-on the questions flowed.

My response was that I thought Leakey was, in principle, on the right track, but that definitive answers about just how one would establish property rights in East Africa’s common property resources, as well as the economic values involved, were practical, empirical questions. Field work and the collection of primary data, among other things, would be required.

At that point, Leakey responded positively: he invited me to prepare a research proposal, and subject to its approval, to join him at the National Museums of Kenya as a Research Associate.

I agreed and wrote a proposal, which was approved. In the summer of 1972, I arrived in Nairobi, where I took up residence at the Norfolk Hotel. In addition to spending hot days going over records of hunting licenses, ivory and game trophy export permits in Nairobi, I spent about a month in the field on safari. There are many remembrances of that. Two notable ones come to mind. While camping in the Masai Mara National Reserve, I observed first-hand a great deal of poaching. Some of it by government employees. Never mind. I also ran into Joy Adamson of Born Free fame out in the bush. It was in the middle of the afternoon, so Adamson had her tracker and scout lay a fire, and we had tea. We spent an hour or so chatting about the economics of wildlife and conservation. Adamson gave my research project a thumbs up, which was very encouraging.

What was not encouraging were some of the findings I was turning up in those records back in Nairobi. When I added up the number of hunting licenses issued each year and the export permits for ivory, etc., there was a huge gap. Legal exports of wildlife trophies, ivory, etc., which were recorded at the Customs Department, exceeded hunting licenses issued by the Game Department by a wide margin. All my arithmetic pointed to a massive amount of corruption at the very highest levels of government. When the Chief Game Warden figured out where my collection and analysis of what were considered rather obscure primary data were pointing, I became persona non grata. Shortly thereafter, I caught a flight from Nairobi to Switzerland, where the World Wildlife Fund (WWF) is located.

It was at the WWF headquarters in Morges, Switzerland that I started to put some of my notes together. Eventually, many of my findings appeared in a piece I co-authored with Robert K. Davis and Frank Mitchell “Conventional and Unconventional Approaches to Wildlife Exploitation,” which was published in 1973. We concluded that the system of parks, protection, prohibitions on trade and traditional hunting rules and regulations — no matter how well intended — were destined to fail to generate prosperity and conserve wildlife. Only by establishing good property rights in land and wildlife will these resources be rendered valuable. Markets for them would then develop. In consequence, they would be wisely used, protected and conserved. Prudent resource use is, as it always has been, all about property, prices, markets and legitimate trade.

If Leakey is to succeed during his time as Chairman of the Board of Directors of the Kenya Wildlife Service, he must do something big, bold and unconventional. To that end, he should revisit the findings of the research project he initiated many moons ago at Johns Hopkins.

via http://ift.tt/21EJfsM Steve H. Hanke

Earlier today we reported that an assailant tried to assassinate the editor-in-chief of Turkey’s Cumhuriyet newspaper Can Dündar, before the court was to announce the verdict on his case.

The paper had published reports implicating the Turkish government in having links with extremists. The gunman shouted “traitor” before firing at least three shots at the journalist. Dundar was not injured in the incident but a journalist was reportedly shot in the crossfire.

The incident was captured in the following dramatic video.

via http://ift.tt/21EJfsB Tyler Durden

Submitted by Pater Tenebrarum via Acting-Man.com,

Tax Receipts vs. the Stock Market

Following the US Treasury’s update of April tax receipts, our friend Mac mailed us a few charts showing the trend in corporate tax payments. Not surprisingly, corporate tax payments and refunds mirror the many signs of a slowing economy that have recently emerged. An overview in chart form follows below. First up, corporate tax receipts in absolute figures.

 

Corporate tax receipts in absolute dollars and cents – this is quite astonishing considering that the amount of money in the US economy has increased by roughly 125% since early 2008. Corporate taxes by contrast haven’t even made it back to the 2007 peak.

 

The next chart shows tax refunds to companies – these traditionally increase when companies aren’t doing as well as they would like:

 

Corporate tax refunds have begun to turn up – they have led the last downturn by about 7 months

 

The next chart shows the underlying trend in the form of the 12-month rolling change in net corporate tax receipts. This shows actually a quite noteworthy development: the 12 month rolling change has just crossed into negative territory to the greatest extent since late 2007 (there was a very tiny dip below the zero line in 2011 as well, during the peak of the euro area debt crisis):

 

12 month rolling change in net corporate tax receipts – click to enlarge.

 

Mac had the interesting idea to compare gross corporate tax receipts to the S&P 500 index as well. In a way, it can be thought of as an alternative market valuation measure. As he notes to this chart:

“The market and tax receipts began to diverge at about the exact same time that QE1 began.”

 

Corporate tax receipts (red line) vs. the S&P 500 (blue line), indexed since 2005. Note the large positive gap prior to 2010 and the persistent (and now widening) negative gap since then.

 

Moving the starting point of the above comparison to January 2007 makes the diverging trends even more obvious (note that the colors have been switched in this chart):

 

S&P 500 (red line) vs. corporate tax receipts (blue line) – drifting apart.

 

Conclusion

Several things can be gleaned from this:

1. the economy is indeed slowing down, and corporate profits are coming under pressure (notwithstanding the non-GAAP and buyback influenced per share data reported by listed companies);

 

2. aggregate corporate tax receipt data are apparently a good leading indicator of economic downturns (but not of upturns, presumably because write-downs tend to lag economic recoveries);

 

3. the stock market’s valuation and the real economy have drifted apart quite a bit

This is nothing new of course, but it is once again confirmed by these data as well.

via http://ift.tt/1SSg9Uw Tyler Durden

By EconMatters

 

 

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With Obama yet again on TV, taking credit for the Fed’s reflation of the stock market as somehow indicative of an economic “recovery” (“fiction peddlers” not allowed in the crowd), here is another way of showing the unprecedented transformation in the US labor pool: since December 2014, the US has added just under 450,000 waiters and bartenders, and no manufacturing workers.

Behold: “Obama’s recovery.”

via http://ift.tt/21EzjPS Tyler Durden

Buy Gold, ‘Get Out Of The Stock Market’ Warns Druckenmiller

Buy gold and ‘get out of the stock market’, legendary billionaire investor, advised investors at an investment conference in New York this week.

Druckenmiller, who has one of the best long-term track records in money management, said the stock market bull market has “exhausted itself” and that gold “remains our largest currency allocation.”

Stan Druckenmiller. Photographer: Scott Eells/Bloomberg

He told the Sohn Investment Conference attendees to sell their equity holdings:

“The conference wants a specific recommendation from me. I guess ‘Get out of the stock market’ isn’t clear enough …”

He has been very critical of Federal Reserve and central bank monetary policies in recent years while correctly anticipating at that time that it would lead to higher asset prices.

“I now feel the weight of the evidence has shifted the other way; higher valuations, three more years of unproductive corporate behavior, limits to further easing and excessive borrowing from the future suggest that the bull market is exhausting itself,” said Druckenmiller, who averaged annual returns of 30 percent from 1986 through 2010 at his Duquesne Capital Management. He’s up 8 percent this year, according to a person familiar with the matter.

As bankers experiment with “the absurd notion of negative interest rates,” Druckenmiller said, he is investing in gold.

“Some regard it as a metal, we regard it as a currency and it remains our largest currency allocation,” he said.

On the Fed, Druckenmiller said the central bank has borrowed more “from future consumption than ever before.”

“By most objective measures, we are deep into the longest period ever of excessively easy monetary policies,” he said. “Despite finally ending QE, the Fed’s radical dovishness continues today. By most objective measures, we are deep into the longest period ever of excessively easy monetary policies. In other words, and quite ironically, this is the least ‘data dependent’ Fed we have had in history.”

Druckenmiller said “volatility in global equity markets over the past year, which often precedes a major trend change, suggests that their risk/reward is negative without substantially lower prices and/or structural reform. Don’t hold your breath for the latter.”

Read full article on Bloomberg here

Gold and Silver Prices and News
Gold Set for Weekly Drop Of 0.6% Before Payroll Report Offers Rates Clue (Bloomberg)
Gold set for weekly decline ahead of U.S. jobs data (Reuters)
Gold Futures Fall for Third Day as Dollar Gains Squelch Demand (Bloomberg)
Gold falls for fourth day as dollar extends its gains (Reuters)
Jobless Claims in U.S. Increase to Highest Level in Five Weeks (Bloomberg)

Gold Is Back In A Bull Market (Money Week)
Gold To Rise Further, Charts Show – $1,340 Short Term Target (CNBC)
Highly Simplistic and Unbalanced Anti Gold Article (Guardian)
Italian Banks: It’s the Hope That Kills You (Bloomberg)
Hong Kong to Gain as China Streamlines Cross-border Gold Trade (SCMP)
Read More Here

Gold Prices (LBMA)
06 May: USD 1,280.25, EUR 1,121.06 and GBP 883.04 per ounce
05 May: USD 1,275.75, EUR 1,114.95 and GBP 879.23 per ounce
04 May: USD 1,280.30, EUR 1,114.18 and GBP 883.59 per ounce
03 May: USD 1,296.50, EUR 1,118.15 and GBP 881.32 per ounce
29 April: USD 1,274.50, EUR 1,119.45 and GBP 873.80 per ounce

Silver Prices (LBMA)
06 May: USD 17.31, EUR 15.15 and GBP 11.93 per ounce
05 May: USD 17.38, EUR 15.21 and GBP 12.01 per ounce
04 May: USD 17.18, EUR 14.96 and GBP 11.86 per ounce
03 May: USD 17.49, EUR 15.10 and GBP 11.92 per ounce
29 April: USD 17.85, EUR 15.67 and GBP 12.22 per ounce

 

Access Our Most Popular Guides in Recent Months

www.GoldCore.com 

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Grab your popcorn. Having proclaimed his greatest achievement during his presidency as "saving the world from another Great Depression," we wonder what President Obama will have to say today when he discusses the economy. Following the decline in corporate profits, a manufacturing sector in recession, an auto industry which is shuttering production, minimum wage state job losses rising, and an equity market that is unable to make new highs, what cynical, skeptical, "fiction-peddlers" will he blame today's dismal jobs data on?

President Barack Obama on Friday will deliver a statement "on the economy and new steps to strengthen financial transparency and combat money laundering, corruption, and tax evasion," the White House said.

President Obama is due to speak on the economy at 1205ET…

Alternate Live Feed…

 

How long before Janet gets another visit from the smoke-and-mirrors-er-in-chief?

*  *  *

While we are at it, we wonder if Obama will explain why Donald Trump's support is soaring if everything is so awesome…

President Obama’s remarkable interview last week with the New York Times ’s Andrew Ross Sorkin shows why historians are likely to assign Mr. Obama a share of responsibility for the rise of Donald Trump.

To be sure, the president was dealt a tough hand in 2009, and he played it brilliantly at first. His much-criticized Treasury secretary, Timothy Geithner, did what was necessary to pull the U.S. financial system back from the brink. Under intense pressure, the president’s team crafted a package of steps that saved the American automobile industry. The Obama administration’s stimulus package, despite its defects, helped slow a steep economic decline, which at its worst was destroying 800,000 jobs monthly.

Mr. Obama has every right to claim credit for preventing a second Great Depression that would have taken down the entire global economy.

This was a great first act. Unfortunately, there was no Act 2 and, as Mr. Sorkin reports, Mr. Obama knows it. The president laments, for example, “our failure in 2012, 2013, 2014, to initiate a massive infrastructure project” means that “there were folks who we could have helped and put back to work and entire communities that could have prospered that ended up taking a lot longer to recovery.”

The only problem with the president’s lament is its chronology. The failure occurred much earlier, in 2009 and 2010, when Mr. Obama still enjoyed the support of a Democratic-led Congress he needed to move boldly. Despite campaigning for a national infrastructure bank in 2008, he didn’t insist on including it in the 2009 stimulus bill. He didn’t even publicly raise the matter until September 2010, when the midterm election was looming and the chance of enacting new legislation was effectively nil.

This was part of a broader strategic decision to move from his initial focus on averting economic disaster to other concerns—notably, the Affordable Care Act and carbon cap-and-trade legislation. Whatever balance of benefits and opportunity costs the focus on health care may have entailed, the months the House spent in 2009 on an environmental bill that never had a chance in the Senate were a total loss. The exodus of white working-class voters from the Democratic Party contributed to this loss of focus on core economic concerns.

When Republicans regained control of the House in November 2010, the moment for an infrastructure bank and an Act 2 economic plan had passed. The result: an economic recovery that was much slower than it had to be.

President Obama insists—rightly—that the U.S. has done much better than most other advanced economies. Unemployment has come down further than in Europe, and GDP has risen faster.

But most Americans are not comparing the U.S. performance with that of other countries. They are comparing it with previous recoveries in this country, and they are evaluating it in light of their own circumstances. They are painfully aware that their household income is still lower than it was at the end of the Clinton administration and that the jobs many of them have gotten during the recovery pay much less than the jobs they lost during the recession.

People intuit what economists have shown: that the share of overall income growth going to average Americans has been lower in recent years than in any prior economic recovery. They don’t understand why this is happening, but they do expect their leaders to acknowledge it and do something about it.

This is why Mr. Obama is wrong to suggest that his central problem has been an inability to communicate his economic success more effectively. As the old line goes, “Who are you going to believe, me or your own eyes?” The people have given their answer in the form of the Bernie Sanders insurgency and the Republicans’ stunning turn to Donald Trump.

It will fall to President Obama’s Democratic successor to enact the long-deferred Act 2 of the recovery.

via http://ift.tt/1Tsg6uw Tyler Durden

At the end of Wynn’s Q1 conference call, CEO Steve Wynn went on an epic tirade focusing initially on short sellers then shifting into a fascinating, and detailed, explanation of how HFTs manipulate his stock. What he explained happens to his stock when HFTs attempt to deceive traders, is what we have said ever since 2009.

Here is the key excerpt from his conference call transcript.

Well, we never know what the Street is going to do with the funky trading. And we all feel that, both as individuals and as a company, that we should be prepared to take advantage of real opportunity when it occurs. And my board feels that way, and so do I. So we just wanted to make sure that we are property armed in case there was something strange that happened on Wall Street and the stock market dropped or our stock went to a level that we thought was grossly over-sold, we would jump on it.

 

As long as the short players fool around for $1 or $2, that’s fine. But when shorts – the exchanges really don’t enforce the rules of naked shorts. So, I mean, it’s unconscionable manipulation of the stock that occurs. They open up every morning, and the high-frequency traders in the shorts have a ball selling shares, and then value buyers step in in the afternoon and they cover the shorts. I mean, it’s regular casino activity.

 

The activity on the stock markets is, in my view, poorly regulated and irresponsibly policed, especially with regard to short sales. And when it gets out of hand – we see a lot of shorts because of China, because we’re such a clear China play. 

…

 

And although I can’t do anything about it myself, I take advantage of it when it gets online and buy shares. I mean it’s fine when they drive the stock down for reasons that are irrelevant and completely disconnected from anything to do with our business operations. So the stock markets got more volatile, more stupid as a gambling game than ever before. And I look at it that way, to be honest with you. I have very little respect for the integrity of the trading on the exchange in most stocks. And I have particular disdain for the fact that the SEC has failed to deal with high-frequency traders who are doing nothing more than taking advantage of inside information, a buy or a sell order, because of technology advantages.

 

If you read Flash Boys, it’s all spelled out for you. And if I execute an order, I’ll use IEX, I’ll use Brad Katsuyama if I was buying something, so I couldn’t be fronted by the high-frequency traders. But there’s an awful lot of that going on.

 

The other day I was watching the stock open up, and it went up on share volumes of a few thousand shares. I mean, every trade was a tick up. That’s not the way it should operate in an honestly or intelligently run exchange. 

 

But that’s the thing, all those guys sold their dark pools and their order flow and the positioning on the floors of the servers to the HFTs. And it’s made a couple of guys that I’m friendly with very rich because they are high-frequency traders. But I don’t respect the activity, and I’m severely critical of it. And don’t mind saying so, either.

Thanks Steve for confirming the tinfoil hattery written on this site, exposing precisely this ever since 2009.

Still, we are confused: if it is so clear that even unsophisticated market participants now realize how the rigging takes place, why is it that the only person who should be severely critical of HFT rigging, SEC Chairman Mary-Jo White, refuses to say anything? By the way, that is a rhetorical question.

via http://ift.tt/1WO7T9A Tyler Durden

Submitted by David Stockman via Contra Corner blog,

When it comes to the economic future, a Trump presidency could bring either a shitstorm or salvation. Regrettably, the odds of the former are immensely the higher.

That’s because Trump is a welcome, but extremely unguided missile.

On the one hand, his great virtue is that he is a superb salesman and showman who has captured the GOP nomination and has a serious shot at the White House with absolutely no help whatsoever from the Washington/Wall Street establishment.

So unlike any other candidate in recent memory, he owns his own talking points; is not saddled with a stable of credentialed advisors schooled in three decades of policy error and failure; and has the hutzpah to trust his own instincts——many of which, especially on foreign policy, are exactly the rebuke that Imperial Washington and its legions of parasites and racketeers so richly deserve.

On the other hand, the Donald’s policy thinking, if you can call it that, is thoroughly inchoate. His policy pronouncements amount to little more than spontaneous eruptions of sentiment, prejudice, hearsay, bile, applause lines, wishful thinking and disconnected non sequiturs. That’s where thoughtlets like Muslim bans, mass deportations, a Trump Wall on the Rio Grande, paying off the national debt, 40% tariff barriers, obliteration of ISIS and numerous other stray verbal hand grenades come from.

Yet occasional wild pitches are not really the problem, and the cynics are surely correct in predicting that Trump will excise most of them from his patter even before the GOP convention. The real problem is that Trump has no detectable economic philosophy or policy framework, and it is in that arena that he could go careening off into a cacophony of misfires, mistakes and statist mayhem.

To wit, Trump has already said that he likes the Fed’s low interest rates, is considering a minimum wage hike, thinks social security and medicare should remain untouched, will rebuild the military, intends to drastically increase spending for veterans, wants to slash income taxes on corporations and individuals, thinks a big infrastructure program is warranted, plans to spend tens of billions on border security and the Wall and will drastically hammer $2.2 trillion of imports in order to bring jobs back home.

Not only is most of that unaffordable, counter-productive and wrong. More importantly, Trump’s mish mash of economic policy utterances thus far fails to address why the Washington/Wall Street/Bicoastal/Bubble Finance status quo is failing main street so badly and causing 90% of Americans to realize that they are not winning economically anymore.

The heart of what went wrong is the lethal combination of free money and free trade that has been practiced ever since Greenspan panicked after Black Monday in October 1987. That is what has gutted the fly-over economy while gifting casino prosperity to Wall Street, Washington and the bicoastal elites, as I documented in Part 1. (click here for Part 1)

But as I indicated yesterday, there is a sliver of hope if Donald Trump does not capitulate to mainstream policies and is willing to set aside his potpourri  of shibboleths and panaceas in favor of a disciplined and coherent game plan that builds on his bedrock political insight that American families are losing the economic battle. To repeat, there is a way forward for the self-proclaimed world class deal maker to move the whole mess out of the hopeless paralysis of governance that now afflicts the nation.

A President Trump would need to make Six Great Deals…

A Peace Deal with Putin for cooperation in the middle east, defeat of ISIS, withdrawal from NATO and a comprehensive worldwide disarmament agreement.

 

A Jobs Deal based on slashing taxes on business and workers and replacing them with taxes on consumption and imports.

 

A Federalist Deal to turn back much of Washington’s domestic programs and meddling to the states and localities in return for a 4-year freeze on every single pending regulation and statue.

 

A Health Care Deal based on the repeal of Obamacare and tax preferences for employer insurance plans and their replacement with wide-open provider competition, consumer choice and individual health tax credits.

 

A Fiscal Deal to slash post-disarmament spending for defense, devolve education and other domestic programs to the states and cities and to clawback unearned social security/medicare entitlement benefits from the affluent elderly.

 

And a Sound Money Deal to end the Fed’s war on savers and retirees, repeal Humphrey-Hawkins and limit the central bank’s remit to providing last resort liquidity at a penalty spread over market interest rates based on good commercial collateral.

Under what would in effect be a restoration of the original vision of Carter Glass, who was a storied financial statesman and author of the 1913 enabling legislation, the Fed’s authority to conduct open market operations and unlimited money printing would be eliminated. And its liquidity backstop would be limited to “narrow banks” which just take deposits and make loans, and have nothing to do with Wall Street trading, underwriting, hedging, derivatives and other forms of financial gambling.

Needless to say, this all sounds like radicalism relative to the prevailing system of Casino Capitalism and the Big Government status quo. But all of that is in for a rude awakening, and soon.

That’s because the Bubble Finance status quo as we know it is on its last legs. With each driblet of “incoming data” it is evident that a new recession is just around the corner. With each limpid trading session on Wall Street it is also evident that most carbon units have vacated the casino and that the robo-machines are running out of chart points to chase. That means a big market dive is coming soon.

In fact, a recession, a market crash, an explosion of deficit projections and, for good measure, double digit increases in next year’s health insurance premiums and copays will be hitting the headlines before the final Hillary/Donald debate duals of the fall campaign. It is this impending perfect storm that offers Trump the chance to hang 30-years of failed policy on Hillary Clinton as the insider totem, and to bombastically demand in the patented Trumpster style a clean sweep of the Washington/Wall Street/Federal Reserve policy mess.

I know from personal experience and long observation that it has to start with a Peace Deal. That’s the secret to unlocking the entire Washington policy gridlock and the resulting drift toward national bankruptcy, which otherwise will prove unstoppable. Indeed, nothing can change until at least $200 billion is whacked out of the defense budget, and under the circumstances ahead that could easily be done.

That propitious opportunity for peace is the emerging worldwide Great Deflation. It is taking down the Red Ponzi in China already and is administering the coup de grace to Russia’s third rate, New York SMSA-sized oil, mineral and wheat based economy. At the same time, the next US administration will be grappling with recessionary trillion dollar annual deficits while the socialist enclaves of European NATO will face fiscal burial in a renewed eruption of public debts that already average nearly 100% of GDP.

The key to a global Peace Deal is renunciation of Washington’s encroachment on Russia’s backyard in Ukraine and the former Warsaw Pact nations; and a Russian/Washington/Shiite alliance to encircle the Islamic state and enable Muslim fighters from Syria, Iran, Iraq and Hezbollah to finish off the butchers of the mutant Sunni Caliphate.

The NATO renunciation part of the deal is already in Trump’s wheelhouse because he thinks he can make a deal with Putin anyway, and has had the common sense to see that NATO is obsolete. What he needs to further understand is that Russia is incapable of threatening Europe and has no designs to do so.

Moreover, it is Washington, not the Europeans, who insisted on the pointless expansion of NATO. And it was Washington which betrayed George HW Bush’s sensible promise to Gorbachev in 1989 that in return for his acquiescence to the reunification of Germany NATO would “not be expanded by a single inch”.

There is even a bonus presidential debate point for the Donald on the latter matter. The betrayal of the elder Bush’s pledge was initiated by none other than Bill Clinton in the midst of his political crisis during the blue dress affair. Do not doubt the Donald’s capacity to put that one straight to Hillary.

Likewise, Trump is already half way there on the ISIS threat. Unlike the neocon adventurists of Washington, he has welcomed Putin’s bombing campaign against the jihadist radicals in Syria and recognizes that the enemy is headquartered in Raqqa, not Damascus.

God willing, it is to be hoped that he somehow comes to understand that the Iranians have a justified grudge against Washington for its historic support of the Shah’s plunder and savage repression; for CIA aid to Saddam’s brutal chemical warfare against Iran during the 1980s war; and for Washington’s subsequent demonization of the regime and false claims that it is hell-bent on nuclear weapons—–a charge that even the nation’s top 16 intelligence agencies debunked more than a decade ago.

To wit, the way out of the bloody mess in Iraq, Syria, Yemen and Libya—-all of which are projects bearing Hillary’s support and even inspiration—–is a rapprochement with Iran’s able and moderate statesman, President Hassan Rouhani, who has just received another wave of political reinforcement in the recent elections.

Someone needs to tutor the Donald on the great General Eisenhower’s pledge to go to Korea and make peace immediately after the election in 1952, which is exactly what he did. Likewise, the presumptive GOP candidate should pledge to go to Tehran to “improve the deal”, and this time Trump even has the plane!

Yes, “improving” the deal might be positioned as somehow strengthening Obama’s “bad deal” on the nuclear accord, but that would be the diplomatic fig leaf for domestic political consumption. The far broader purpose would be to bury the hatchet on the general bilateral relationship between the US and Iran, and to secure Rouhani’s agreement to a leadership role in the above referenced Muslin-led ground campaign to extinguish ISIS and liberate the territories now controlled by the Islamic State.

An “I will go to Tehran” pledge by Trump could electrify the entire mideast policy morass and pave the way for early US extraction from its is counter-productive and wholly unaffordable military and political intrusion. The fact is, the Islamic State is on its last leg because of US and Russian bombings, $30s oil and its own barbaric brutality. These forces are rapidly drying up its financial resources, and without paychecks its “fighters” rapidly vanish.

Indeed, ISIS is now so financially desperate that its fighters are literally disappearing. That is, it is shooting its wounded and selling their organs on the black market.

Needless to say, no army of fighters has ever prevailed or even survived by harvesting its own flesh. And especially not when confronted by an opposing force of better trained, better equipped, air-power supported fighters motivated by an equal and opposite religious fanaticism.

Accordingly, a Trump-Putin-Rouhani alliance could very readily celebrate the liberation of Raqqa and Mosul by July 4th next year, along with an history-reversing partition agreement to cancel the destructive Sikes-Picot boundaries of 1916. The latter would be superseded by Shiite, Sunni and Kurdish states, respectively in their historic areas of Iraq and a shrunken state of Alawites, Christians and other non-Sunni minorities in Syria , with protectorates in the north and east for Kurds and Sunnis.

At that point, Trump could put on his own “mission accomplished” pageant by bringing home every last American military personnel now stationed in the middle east, either overtly or covertly and wearing boots on the ground or not. And he could do so from the deck of an aircraft carrier that had been withdrawn from the Persian Gulf as part of the comprehensive Peace Deal with Putin and Rouhani. The Persian Gulf would be an American Lake no more.

The Donald might even be positioned to collect his Nobel Peace Prize on the way home.

Before then, however, he would also be in a position to collect some giant domestic political plaudits that could be married with the defeat of ISIS and peace in the middle east and Europe. To wit, Trump should promise to sign legislation day one permitting families of the victims of 9/11 to suit the Saudis for their losses.

Nothing could better bring closure to the vastly exaggerated domestic terrorist threat than the simultaneous eradication of the Islamic State and mutli-hundred billion lawsuits against the alleged 9/11 puppeteers hitting the headlines day after day.

Also, nothing would do more to provide political cover and impetus for the balance of the Peace Deal.  That’s because the indigenous terrorist threat in Europe is not sponsored, supported or funded in any manner by the nations of the Shiite Crescent. Instead, it is an extension of the mutant jihadism of radical Sunni and Wahhabi clerics.

Needless to say, even the unspeakably corrupt and arrogant princes of the House of Saud would get the message when the 5th Fleet leaves the Persian Gulf and the Trump/Putin/Rouhani alliance takes out its proxies in Syria and the Islamic State itself. In short, the financial lifeblood of terrorism would dry up—-whether the Saudi royals remained in Riyadh or decamped to Switzerland.

The essence of the great Peace Deal required to save the American economy is an end to procurement and R&D spending by the Pentagon and a drastic demobilization of the 2.3 million troops in the regular armed forces and national guards. And that can happen under the auspices of a global military “build-down” agreement and freeze on all further weapons exports.

Bankrupt governments in a world where NATO has been decommissioned, the Jihadi terrorist threat quelled and the middle east stabilized will absolutely be interested in a defense “builddown” and global arms reduction agreement. And there is no one better qualified to lead a sweeping military cost “restructuring” deal among bankrupt nations than the well experienced Donald Trump.

via http://ift.tt/1UEWqZK Tyler Durden

Turkey’s conversion into an all out despotic, banana republic is almost complete.

Recall that in November, violence erupted in the troubled nation in which president Erdogan is now actively seeking dictatorial powers after a prominent lawyer and foe of Erdogan, was assassinated on live TV. This occured just days before Erdogan arrests journalists who exposed Erdogan’s weapons smuggling to extremist Syrian rebels, among whom was Cumhuriyet editor in chief Can Dundar.

Moments ago Turkey’s NTV reported that a gunman fired three shots at the famous Cumhuriyet editor-in-chief Can Dundar who was waiting outside an Istanbul court where he’s being tried for espionage, in a high profile trial being pursued by President Recep Tayyip Erdogan, NTV reports.  According to the report the bullet misses Dundar and hits an NTV reporter in the leg, NTV says.

Can Dundar arrives at the Justice Palace in Istanbul, Turkey May 6, 2016

Reuters adds that the assailant attempted to shoot Turkish journalist Can Dündar outside a courthouse in Istanbul just before the court was due to announce the verdict in Dündar’s trial on accusations of revealing state secrets.

According to the AP, the police have arrested a gunman after the attempted assasination.  Journalist Erdem Gul, who is on trial along with Dundar, said the attacker shouted “traitor” as he fired.

* * *

Earlier on Friday, Dündar said journalism was on trial as he gave his final defence in a case that has drawn international criticism of Turkey’s press freedom record.

Dündar, editor-in-chief of Cumhuriyet newspaper, and Erdem Gül, its Ankara bureau chief, could face life in jail on espionage charges and attempting to topple the government for publishing footage that purported to show Turkey’s state intelligence agency ferrying weapons into Syria in 2014. Their lawyers said the prosecutor did not seek the espionage charge in his closing statement, but nonetheless called for Dündar to be jailed for 25 years for procuring and revealing state secrets and for Gül to be jailed for 10 years for publishing them.

“We are now on trial for our story: for acquiring and publishing state secrets,” Dündar told Reuters during a court recess. “This confirms journalism is on trial, making our defence easier and a conviction harder.”

Recep Tayyip Erdogan, who joined the trial as a complainant, accused the men of undermining Turkey’s international reputation and vowed Dündar would “pay a heavy price”, raising opposition concerns the case was politicised.

It appears he also meant the ultimate price.

“This case isn’t based on law, it’s political,” said Mahmut Tanal, from the opposition Republican People’s party. “That’s evidenced by the president joining this case as a complainant … There is an attempt to pressure the court.”

Cumhuriyet’s revelations, published in May 2015, infuriated Erdogan, who said that Dündar would “pay a heavy price” and personally filed a criminal complaint against the journalists for what he has portrayed as part of an attempt to undermine Turkey’s global standing.

The story was based on a 2014 video purporting to show Turkey’s state intelligence agency helping to transport weapons to Syria. Erdogan has acknowledged that the lorries, which were stopped by Turkish paramilitary forces and police officers en rout to the Syrian border, belonged to the intelligence agency but said they were carrying aid to Turkmen rebels in Syria. Turkmen fighters are battling both the Syrian president, Bashar al-Assad, and Isis.

Expect this unprecedented crackdown on the free press to continue: just two weeks ago Erdogan arrested a Dutch journalist for a critical tweet, which in turn followed Erodgan decition to designate journalists as potential “terrorists”:

“It is not only the person who pulls the trigger, but those who made that possible who should be defined as terrorists, regardless of their title,” Turkish President Tayyip Recep Erdogan said on Monday, in an attempt to convince parliament to include journalists, politicians, academics, and activists under the country’s anti-extremism laws.

Meanwhile, this “close friend” of Europe who now has all the leverage he needs to call all the shots since he controls the flow of millions of potential refugees, made a mockery of the EU earlier today, when Erdogan told the European Union on Friday, Turkey would not make changes to its terrorism laws required under a deal to curb migration, and declared: “we’re going our way, you go yours”.

As Reuters reported, his fiery speech will be a blow to any hope in European capitals that it might be business as usual with Turkey after Prime Minister Ahmet Davutoglu, who negotiated the migration deal with Europe and had largely delivered on Turkey’s commitments so far, announced he was standing down.

The EU asked member states on Wednesday to grant visa-free travel to Turks in return for Ankara stopping migrants reaching Europe, but said Turkey still had to change some laws first, including bringing its terrorism laws in line with EU standards.

“When Turkey is under attack from terrorist organizations and the powers that support them directly, or indirectly, the EU is telling us to change the law on terrorism,” Erdogan said in a speech at the opening of a local government office.

In short: Erdogan will do whatever it wants to do, and Europe has zero control over the wannabe dictator.

via http://ift.tt/1Weg68y Tyler Durden