“Pompeo Has Lost His Mind” – China Hits Back At Latin America Remarks

China has come out swinging after Mike Pompeo’s three-day Latin America tour in which the Secretary of State publicly called out China for spreading “disorder” in Latin America alongside Russia. Pompeo identified the two countries, both of which have over the past two months condemned US efforts toward regime change in Venezuela, of backing failing investment projects that only fuel corruption and undermine democracy, especially in Venezuela.

China’s ambassador to Chile, Xu Bu, quickly lashed out in response to America’s top diplomat blaming China for Latin America’s economic woes which first came last Friday while standing alongside Chilean President Sebastian Pinera. Ambassador Xu told the Chilean newspaper La Tercera: “Mr Pompeo has lost his mind.”

Prior file photo of Pompeo with Chinese Foreign Minister Wang Yi

Pompeo had asserted during his tour that Chinese investment and economic intervention in Venezuela, now facing financial and infrastructural collapse amidst political turmoil, had “helped destroy” the country and said Latin American leaders must therefore see who their “true friend” is. 

“China’s bankrolling of the Maduro regime helped precipitate and prolong the crisis in that country,” Pompeo had stated, and further described Maduro as “a power-hungry tyrant who has brought ruin to his country and to his people”.

“I think there’s a lesson … to be learned for all of us: China and others are being hypocritical calling for non-intervention in Venezuela’s affairs. Their own financial interventions have helped destroy that country,” Pompeo added.

China is Venezuela’s biggest foreign creditor has provided up to $62bn in loans since 2007, according to estimates.

The Chinese foreign ministry didn’t hold back in its response: “For some time, some US politicians have been carrying the same version, the same script of slandering China all over the world, and fanning the flames and sowing discord everywhere,” Ministry spokesman Lu Kang said in a Monday statement

“The words and deeds are despicable. But lies are lies, even if you say it a thousand times, they are still lies. Mr Pompeo, you can stop,” the spokesman said.

Hinting at Washington’s Cold War era record of overthrowing governments in Latin America — a longstanding tradition that can be traced all the way back to the Cold War, the statement added: “The Latin American countries have good judgment about who is their true friend and who is false, and who is breaking rules and making trouble,” Lu said.

The Chinese Ambassador to Chile’s remarks had also remotely invoked a continued Monroe Doctrine mentality on the part of US officials, saying “Pompeo’s body has entered the 21st century but his mind remains in the 20th century, full of thoughts about hegemony and the cold war,” Amb. Xu told La Tercera.

In addition to being the Maduro government’s single largest creditor, China has recently offered to help Venezuela with its failing power grid, after a series of devastating mass outages over the past month has resulted in “medieval” conditions amidst an already collapsing infrastructure. This as Pompeo and Bolton came close to positively celebrating the mass outages as proof of the ineptness of the Maduro regime. 

Beijing also recently denied it has deployed troops to Venezuela after media reports a week ago cited online photos which appeared to show a Chinese military transport plane deployed to Caracas.

Given how boldly and directly Chinese officials’ Monday statements were, it appears Beijing’s patience with Pompeo is running thin, to the point of giving up on a positive avenue with the White House, also amidst a broader trade war. It appears the proverbial gloves are coming off. 

via ZeroHedge News http://bit.ly/2Io2dnM Tyler Durden

‘William Who?’ – Former Massachusetts Gov. To Challenge Trump For Republican Nomination

With a nearly 90% approval rating among Republicans, President Trump’s dominance of the party is beyond question. But that doesn’t mean some of the lingering #NeverTrumpers who tried, and failed, to stop him in 2016 won’t give their Quixotic quest one last go.

John Kasich, long considered the most likely candidate to challenge Trump for the 2020 nomination, has already admitted that “I can’t beat him”, and Maryland Gov. Larry Hogan, another credible challenger from what’s left of the party’s moderate wing, has ruled out a run. But apparently Massachusetts Gov. William Weld, best known nationally for being Libertarian Party candidate Gary Johnson’s running mate in 2016, thinks he has a shot to best Trump in the Republican primary.

Weld

The former governor announced on Monday that he plans to challenge Trump, whose campaign has already raised $30 million for his reelection run, dwarfing the sums raised by even the most popular Democratic challengers, for the 2020 nomination.

For those who are asking themselves ‘who is Weld, exactly?’, here are some facts about the former governor courtesy of Axios:

Current position: Partner at Mintz Levin law firm, member of the Council on Foreign Relations, associate member of the InterAction Council

Age: 73

Born: Smithtown, New York

Undergraduate: Harvard University

Date candidacy announced: April 15, 2019

Previous roles: Governor of Massachusetts (1991-1997), U.S. assistant attorney general for the Criminal Division (1986-1988), U.S. attorney for the District of Massachusetts (1981-1986)

A recent FiveThirtyEight piece described Weld as potentially “one of the weakest candidates that anti-Trump Republicans could put up in a national campaign.”

He tends to be liberal on social issues and moderate on issues like immigration and climate change, while being fiscally conservative. And as if this resume didn’t virtually guarantee that he will get laughed out of the convention…

Abortion: Weld supports abortion rights and has fought to protect them. As governor in 1991, he introduced a bill aiming to make it easier to get an abortion in Massachusetts.

Same-sex marriage: While governor, Weld recognized domestic partnership rights for same-sex couples and signed legislation protecting gay and lesbian students. He also signed a 2013 amicus brief in support of same-sex marriage.

Marijuana: Weld sits on the board of directors of Acreage Holdings, a cannabis company looking to roll back federal regulations, the Washington Post reports. He has supported legalization of medical marijuana since 199.

Economy: Despite his more progressive social views, Weld is a traditional conservative when it comes to the economy, prioritizing cutting spending and cutting taxes.

Climate change: Weld supports rejoining the Paris climate agreement, according to Boston.com.

…his decision to endorse Barack Obama over John McCain in 2008 will.

via ZeroHedge News http://bit.ly/2Gpk37z Tyler Durden

Obama’s Border Patrol Chief: Migrant Crisis ‘Worst In The History Of The Country’

A second ex-Obama admin official has spoken up over the crisis at the southern US border. 

Mark Morgan, a career FBI official who served as Border Patrol chief during the last six months of the Obama administration told Fox Business host Maria Bartiromo on Monday that the US-Mexico border crisis has reached historic proportions and is the worst in the history of the country. 

“this isn’t just a crisis, this is a crisis like we’ve never experienced in the history of this country since we started tracking numbers,” said Morgan, who also addressed false statistics floating around comparing the numbers of migrants to those of the 1990s. 

There’s still this very false talking point out there that — well, back in the ’90s, the numbers were higher — over a million.” Well, first of all, again, you got to remember they were Mexican adults, we were moving, deporting 90 percent of them. With the broken asylum laws and other loopholes that are there, we’re seeing 65 to 70 percent increase in family units, and because of those broken laws, we’re allowing them in. This year, we’re expected to hit a million, but we’re going to let 650,000 into the country. That’s driving this crisis, driving our resources, being overwhelmed. We have to address it.

In late march, former Homeland Security Secretary Jeh Johnson said that the situation at the southern border has reached a crisis, and that the number of apprehensions has exceeded anything he encountered during his time in the Obama administration. 

 

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

Useful Idiots On Parade

Authored by James Howard Kunstler via Kunstler.com,

Anyone interested in glimpsing the Wokester media mentality in full intellectual-yet-idiot smuggery might check out Slate’s Political Gabfest (i.e. podcast) from this past Saturday, titled “The Wahoo Edition.” The Gabfest’s three regulars, David Plotz, Emily Bazelon, and John Dickerson go after Julian Assange as if they were three college dormitory RAs dissecting the character of an unpopular freshman.

Plotz kicked it off by introducing Mr. Assange as “the eminence greasy of Wikileaks,” a cute twist on the French phrase éminence grise (gray eminence, i.e. an elder statesman, pronounced eminence greez, and he knows it). Bazelon offered her explanation for Ecuador’s eagerness to be rid of Mr. Assange:

“He was acting like a big jerk. They were tired of him skateboarding all over the residence and scuffing up the walls and not cleaning his bathroom. He wore out his welcome on hospitality grounds.”

Note: Emily Bazelon is a lawyer. No one mentioned the fact that Ecuador was promised debt relief from the US-controlled International Monetary Fund within hours of expelling Mr. Assange.

Plotz quickly added: “He didn’t clean up after his cat, which, as a cat owner, that is grounds for expulsion.”

Dickerson weighed in: “The big problem is he’s not an appealing man… he’s clearly a narcissist. He’s unpleasant. In addition to messing with our election, he’s basically on Team Russia.”

Plotz said of Wikileaks: “It’s acting as an agent for a foreign governments, as it has with Russia.”

Some people in this sore beset republic get hooked on opiates or crystal meth.

Wokesters get hooked on The Narrative: That Russia “stole” the 2016 election from Hillary Clinton by hacking the Democratic National Committee’s emails, with the collusion of the Trump campaign. The latter point has been authoritatively invalidated by Mr. Mueller, of course, but the Wokester’s cling to their hope that some as-yet-concealed mischief in the Mueller Report will somehow contradict Mr. Mueller’s own conclusions.

As for the alleged hacking per se, you realize of course that neither the FBI nor Mr. Mueller’s “team,” nor anyone in the DOJ before the retirement of Jeff Sessions made any effort to secure and examine the very DNC computer servers at issue. Rather, they relied on a private company called CrowdStrike, hired by Hillary and the DNC itself, to analyze the alleged hacking. Can you imagine anything more arrantly dishonest or more legally irregular?

The Slate Gabfest crew never engages in these dark issues. Nor do they mention the fact that the Mueller “team” (or any other US law enforcement agency) never indicted Mr. Assange for “collusion” with Russia, nor even attempted to interview him and hear what he had to say about it. On his own, Mr. Assange has stated that Russia was not the source of the DNC emails he received and subsequently released to the US news media, including The New York TimesThe WashPo, and the Cable TV News networks, who happily ran with the story. There is a pretty good theory though, advanced by William Binney, a former National Security Agency official-turned-whistleblower, and other Intel Community associates, that he DNC data was “leaked,” not hacked, “by a person with physical access” to the DNC’s computer system. Meaning, someone inside the DNC downloaded the info onto a thumb drive. The data transfer rates prove that, they say.

There is probably a good reason that US government authorities did not essay to make Mr. Assange a witness on-the-record: because his testimony would have prevented Mr. Mueller from bringing his bullshit charges against the Russian internet trolls he indicted — who will never have to come to trial in the USA in any case, and thus never refute The Narrative so earnestly promoted by the Mueller team — until it all fell apart on March 24.

But these are not terms that the Slate Political Gabfest chose to follow in their analysis of Julian Assange and his activities. Rather we got the following, transcribed verbatim:

Bazelon: “Assange is so detestable it’s really tempting to get as far away from him as possible. One look at him and I feel that way about him.”

Plotz: “Do you think Joe Biden would get a little handsy with him?”

Bazelon: “He’s far creepier.”

Dickerson: “You don’t find that Dickensian beard alluring?”

Bazelon: “It’s awful. But I always thought he was clean-shaven yucky.”

Such are the Deep Thoughts of America’s leading Wokester political analysts. One also might ask why Mr. Assange has not been charged by the US with espionage, if that’s what their beef with him really is. In the meantime, behold the disgraceful episode of American journalists pimping for the leviathan state’s privilege to suppress the free flow of news and their own freedom of the press. Imagine them subjecting Daniel Ellsberg to such a hazing.

via ZeroHedge News http://bit.ly/2IzN6Xi Tyler Durden

YouTube Mistakenly Tags Notre Dame Fire Video As ‘9/11 Conspiracy’

Demonstrating just how poorly designed its algorithms intended to filter out ‘conspiratorial’ content can be, particularly when reacting in real time to a breaking news event, YouTube has apologized after its recently launched conspiracy-filtering feature accidentally tagged a livestream of the devastating fire at Notre Dame cathedral as a ‘9/11 conspiracy’ video.

As Bloomberg pointed out, shortly after the fire broke out, several news organizations launched  live streams of the horrific blaze on YouTube. 

Below a stream from France24 and several other channels, a box of text appeared bearing a snippet from Encyclopedia Britannica about the 9/11 attacks, indicating that the footage had been mistakenly labeled a 9/11 conspiracy video.

Notre Dame

YouTube introduced the text boxes last year, but in recent months has taken steps to suppress content it deems ‘conspiratorial’, filtering them out of search results for related topics to prevent the content from corrupting the minds of unsuspecting users.

A YouTube spokesman apologized for the error and said these labels are assigned by algorithms that occasionally make mistakes.

“We are deeply saddened by the ongoing fire at the Notre-Dame cathedral,” said a YouTube spokesman. “These panels are triggered algorithmically and our systems sometimes make the wrong call. We are disabling these panels for live streams related to the fire.”

The mistake was widely mocked on Twitter.

And as one reporter astutely reported, YouTube’s new tool meant to filter out false information is doing the exact opposite.

But sure – let’s continue to allow tech firms to decide what information is fit for public consumption. Because clearly they’re doing such a great job.

via ZeroHedge News http://bit.ly/2v3qwOY Tyler Durden

Foreigners Dump A Record $205BN In US Stocks In Past 12 Months

Led by selling from Belgium (often discussed as a proxy for China), down $10.1 bn…

…foreign central banks dumped Treasuries for the 5th consecutive month (-$157bn), and 10th of last 11 months (-$252bn)…

After the biggest selling since May 2016 last month, Saudis resumed buying USTs in February.

China and Japan were also buyers of USTs…

But away from the bond market, TIC data confirms foreigners sold US stocks for a record 10th consecutive month…

The aggregate $205 billion drop in the last 12 months is the largest liquidation of US equities on record.

Luckily, global money supply is holding US equities up for now…

via ZeroHedge News http://bit.ly/2XiMA4n Tyler Durden

Greenback Gains But Banks, Bitcoin, Bullion, & Bond Yields Slide

As Stocks rise, Volumes slide…

Trade appropriately…

 

China was ugly overnight with ChiNext down once again…

 

Europe ended the day practically unchanged after a solid open for Italy and Spain…

 

US markets more mixed with Small Caps and Trannies worst. S&P, Dow, and Nasdaq all levitated back towards unch in the last hour…

 

Goldman’s results disappointed, erasing all of Friday’s gains and the rest of the banks slumped…

 

And judging by the yield curve, financials still have a long way to go…

 

After tagging an 11 handle on Friday, VIX bounced up to 13 intraday before leaking lower…

 

Treasury yields edged lower today – in a tight range – after Friday’s surge…

 

Having blow above 2.50% on Friday, 10Y Yields drifted very modestly lower today…

 

Following Friday’s slump, the dollar index rebounded notably today, seemingly bid as US markets opened…

 

And while VIX was flashing an 11 handle – FX Vol collapsed to a 5 year low…

 

Cryptos suddenly lurched lower as Bloomberg reported on algos gone wild…

 

Which sent Bitcoin down to $5000, before bouncing back…

 

Commodities drifted lower for most of the last 24 hours, rebounding after US markets opened with silver ending best – unchanged…

 

Gold remains below $1300…

 

Finally, US Macro data is at its weakest since July 2017 as Chinese macro data surges to its best since May 2018 – but we have seen this kind of sudden divergence before…

Don’t forget though – its not the economy, it’s central banks stupid!

via ZeroHedge News http://bit.ly/2UjXV25 Tyler Durden

Did Russia Just Call The End Of The OPEC Deal?

Authored by Julianne Geiger via Oilprice.com,

OPEC and heavyweight Russia may fight America for its share of the oil market, Russia’s Finance Minister Anton Siluanov told TASS on Saturday, even if it means quitting the OPEC deal and lowered oil prices.

OPEC and Russia have tapered oil production according to the agreed upon production cut deal, but the United States continues to increase its production and is picking up market share in the process – market share formerly held by OPEC members and the other non-OPEC signatories to the deal including Russia.

Any failure in the production cut deal, however, will have a negative impact on prices, and could theoretically plunge prices into the $40 per barrel territory. This, in turn, would squeeze US oil producers and hurt new investments, Siluanov said.

“(If the deal is abandoned) the oil prices will go down, then the new investments will shrink, American output will be lower, because the production cost for shale oil is higher than for traditional output.”

Siluanov’s comments came in tandem with warnings of a looming global economic recession.

“The risks of an upcoming global recession are very high,” the Finance Minister said.

“We are ready for a change in global energy prices – we have prepared the budget, the reserves, the balance of payments. We have created this kind of system.”

Russia has been the wildcard in the OPEC+ production cut deal, and has long sent mixed messages regarding their all-in-ness of the deal. And as US production increases and its market share expanding, OPEC’s clout is waning, highlighting the importance of its relationship with Russia.

OPEC’s production has fallen to levels below its commitment. The United States, however, continues to increase production, and currently sits at an all-time-high of 12.2 million bpd, according to the EIA. Before the original production cut deal was established in December 2016, US oil production sat at 8.77 million bpd—a significant increase that undoubtably puts pressure on any of the countries who have tapered production.

President Vladimir Putin on Tuesday, however, assured markets that Russia would continue its cooperation with OPEC.

“We will closely monitor the market, but we will continue cooperation with OPEC,” Putin told TASS, following it up with a more ambiguous chaser.

“If the market situation develops in such a way that reserves increase dramatically, or the US seizes Venezuelan oil and quickly increases its accessibility on the world markets, or something positive happens in Libya in terms of the political situation, and Libya enters the global market, or someone thinks that it is necessary to stop putting pressure on Iran and Iran enters the market with additional volumes, then we will have to take all this into account and make the appropriate decision.”

Under the terms of the production cut deal forged with OPEC, Russia agreed to shave 230,000 bpd to reach 11.191 million bpd.

via ZeroHedge News http://bit.ly/2Gd4YVi Tyler Durden

Inside The US-Led Operation To Bust North Korean Oil Smugglers On The High Seas

For the first time details of an extensive anti-smuggling surveillance operation involving eight United Nations member countries in the East China Sea, in waters near China and North Korea, have been revealed by a new Wall Street Journal investigation

WSJ reporters accompanied the USS Milius and an allied Japanese warship, cooperating further with military surveillance aircraft, on a mission to thwart sanctions busting illegal oil transfers on the high seas to North Korean tankers. 

WSJ: “The route of the North Korean ship Chon Myong 1 from Vladivostok to Nampo port, North Korea, shown on an Eikon ship-tracking screen last year. The ship delivered up to 190,000 barrels of refined petroleum to North Korea’s Wonsan port in May, two months after being sanctioned by the UN.” Image source: UN Photo/Reuters

The stunning report provides a first hand account of in some instances Chinese ships turning off their transponders (“ghosting” international trackers) to covertly transfer petroleum products to North Korean bound tankers on the open waters

One dramatic episode involved the US warship intercepting a cluster of 3 “ghosting” ships pulling near a UN-blacklisted tanker known for illegal smuggling operations into North Korea:

One of the two smaller ships began to quickly move away from the group as the other loosened its mooring to the tanker. Both of the smaller ships carried Chinese flags. No flag was visible on the tanker.

The Milius’s commanding officer, Cmdr. Jon Hopkins, set a course to pull alongside the tanker.

“We got them,” said a Milius crew member on lookout duty.

The United Nations over a year ago imposed tight limits on North Korea’s ability to import oil and petroleum products due to its banned nuclear testing and missile program. 

Via the WSJ: “The Milius changed objectives on April 1 after the sighting of other suspicious activity. Here, the Oceanic Success, a Mongolian-registered oil-products tanker, is seen from the Milius appearing to conduct a ship-to-ship transfer with a vessel directly behind it. A third ship with a red hull to the left appeared to be waiting to take part in a transfer with the Oceanic Success.”

But Pyongyang has long been known to engage in aggressive sanctions thwarting behavior, including conducting ship-to-ship transfers at sea. In response, for the past year a UN group of countries including the U.S., Japan, South Korea, Canada, Australia, New Zealand, the U.K. and France, have patrolled a region covering 700,000 square miles in order to clamp down on sanctions evading. 

Surveillance planes have also been active over the international waters, and the WSJ notes that the United States has conducted up to half of all operations among the eight UN countries.

Tracking map of ships observed as part of the report, via The Wall Street Journal:

The surveillance side of operations is geared toward blacklisting shipowners observed engaged in illegal transfers with North Korean vessels — these ships will in turn be banned by UN countries from entering international ports. 

Perhaps most significant about the WSJ story is that ships were filmed and photographed in action. They were caught preparing for the illegal transfers as USS Milius naval operators and the WSJ crew looked on. 

Via the WSJ: “As the Milius approached the three ships they sailed away from each other. Hoses and fenders seen here on the side of the Oceanic Success indicate that it was involved in a ship-to-ship transfer.”

Another such instance involved the following account with photographs

As it rounded the peninsula, the North Korean ship was also being monitored by a South Korean P-3 surveillance plane, while a Chinese destroyer followed the American and Japanese ships from a distance of around 12 miles. U.S. Navy officials say Chinese warships commonly shadow U.S. naval vessels in international waters in the East China Sea. The parade of four ships continued through the night, led by the slow-moving Kum Un San.

Some among the blacklisted or at least suspect ships monitored, such as the Mongolian flagged Oceanic Success, include tankers with the capacity to transfer up to 50,000 barrels of motor gasoline to North Korea — which alone constitutes one-tenth of the what the UN allows under the North Korea sanctions and restrictions.

But it remains that the US and UN vessels don’t have a mandate to engage militarily. The Milius’s commanding officer, Cmdr. Jon Hopkins, characterized the mission as follows: “We’ve gathered good intelligence,” he said, and added, “Our mission is not to stop everything.”

But worrisome is that this appears another large scale US-spearheaded operation which could bring American vessels into conflict with Chinese warships. 

via ZeroHedge News http://bit.ly/2P9cwMX Tyler Durden

Fed Should “Embrace” And “Communicate Comfort” With Even Higher Inflation: Evans

Back in September 2017, in what may have been the most stunning admission by Janet Yellen during her tenure as Fed chair, she said that “we don’t fully understand inflation” and added that the “shortfall of inflation this year is more of a mystery.” Since then, the Fed’s understanding of inflation appears to have solidified at least in asmuch as the Fed remains unable to find it, despite soaring US housing prices, which continue to increase at roughly 2 to 5 times greater than wage inflation every year (depending on the metro area), not to mention out of control university tuition prices, healthcare costs and sharp occasional spikes in food prices which are far more sticky to the upside, stubbornly refusing to drop after any price shock.

And then there are of course, runaway asset prices and include both domestic and international stock and bond prices, which as Goldman has repeatedly shown, have soared since January 2009. Of course, the Fed ignores these and focuses only on the BLS’ hedonically-adjusted, politically goalseeked CPI basket.

None of these considerations mattered to Chicago Fed president Charlie Evans on Monday, however, when he again said that in keeping with the Fed’s shifting approach to monetary policy which will likely include direct inflation targeting during the next recession, the Federal Reserve “should be willing to embrace inflation above 2% half the time and communicate that preference with the public to avoid missing its current target.”

In other words, in a country where the purchasing power and net worth of the middle class continues to erode, the Fed is willing and eager to accelerate this relative transfer of wealth from the 90% to the 1% by sending inflation into overdrive any and every time it so desires.

“While policy has been successful in achieving our maximum employment mandate, it has been less successful with regard to our inflation objective,” Evans said, clearly referencing US CPI and the various “real economy prices” shown on the right side of the chart above while ignoring the asset prices on the left.

“To fix this problem, I think the Fed must be willing to embrace inflation modestly above 2 percent 50 percent of the time. Indeed, I would communicate comfort with core inflation rates of 2-1/2 percent, as long as there is no obvious upward momentum and the path back toward 2 percent can be well managed.”

In other words, in a world in which central banks have led to unprecedented wealth divides in every jurisdiction, and have been instrumental in the at time violent polarization of the world between haves and have nots, with resulting populist consequences, the Chicago Fed president believes that the right thing to do is take what has clearly not worked so far, and to do much more of it.

As Reuters notes, Evans’ remarks come ahead of a broad Fed policy review this year that may result in the central bank welcoming inflation that is “slightly and temporarily over its target.” Some policymakers and analysts think the Fed now has far more ability to respond to upward spikes in prices than to persistently low readings. That is because interest rate cuts lose their potency as borrowing costs approach zero.

Of course, since any alternatives to the Fed’s current approach will lead to much higher prices borne by the US middle class, resulting in an even lower standard of living, they will be definition be controversial and to Evans this means that “the central bank will need to debate those options carefully.”

Evans also voiced support for the Fed’s current stance of patience on any further rate hikes given “heightened uncertainty,” including the outcome of U.S.-China trade negotiations; the same negotiations which have prompted euphoric stock market bullishness virtually daily for the past 4 months every time a new flashing red headline suggest that the trade deal is “optimsitically” imminent.

“At the moment, the risks from the downside scenarios loom larger than those from the upside ones,” he said at a New York Association of Business Economists event.

Evans, who incidentally is just another clueless economist and who gets his “signals” from the market, as recently as January forecasted three rate hikes this year, still says that “some further rate increases may be appropriate over time” if growth is close to its potential. He sees growth at around 1-3/4 to 2 percent this year, lower than his prior estimates.

But wait, it gets better, because just three months after seeing three rate hikes, Evans – who was one of the Fed’s greatest doves for much of the past five years – is now contemplating rate cuts and asked by reporters after his speech in New York if he would consider rate cuts to support inflation, Evans says “I think the answer has to be yes. It depends on what the scenario is.”

One scenario he proposed: “If core inflation were to move down to, let’s just say, 1.5 percent, that’s below our 2 percent goal. It’s certainly below what I would say is symmetry. So, I would assume that means that our setting of the funds rate is actually restrictive in holding back inflation, and so that would naturally call for a lower funds rate”

“I don’t expect that to be the case, but hypothetically speaking, that would be an argument.”

Another hypothetical scenario, which Evans did not mention but which is just as likely to prompt calls for rate cuts, if not QE4: a sharp drop of more than 10% in the S&P to whatever the Fed’s revised “Powell put” level may be.

Finally, when asked on the recent yield curve inversion, Evans said that “the kind of inversion we’ve seen so far is not necessarily consistent” with the type of past inversions that have presaged recessions. Of course, nobody at the Fed ever had a problem with the yield curve when it was steeper, as it was precisely the type of past inversion that presaged economic booms…

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