Category: zerohedge

Echoes Of 2016: MSNBC Slanders Sanders With Outright Lie After Saturday Speech

Bernie Sanders faced his second MSM sandbagging in less than a week after MSNBC let an undisclosed Clinton operative lie about what he said on live television in reaction to Sanders’ first 2020 presidential campaign speech, according to The Intercept‘s Glenn Greenwald (and anyone who heard Sanders speak). 

Sanders – who was introduced by two African Americans and racial justice advocate Shaun King, was praised for his lifelong commitment to civil rights, including being “only one of two white elected officials” to support Jesse Jackson’s 1984 run for president. 

After the speech, MSNBC turned to Zerlina Maxwell – who they failed to mention was a paid official for Hillary Clinton’s 2016 campaign, identifying her only as a “MSNBC analyst.” 

Maxwell proceeded to lie – saying of Sanders’ speech: “I clocked it. He did not mention race or gender until 23 minutes into the speech. And just for point of comparison, I went back and looked at Elizabeth Warren’s opening speech, for example. She mentions race and discrimination in the first paragraph. So that’s a big difference.”

Note the immediate comparison to Elizabeth Warren – the ‘relatable’ beer-swilling media darling who’s overcome career-boosting lies about her heritage to become the left’s 2020 media darling.

As Greenwald notes, Maxwell’s claim is a complete lie, which MSNBC allowed her to spew unchallenged. Maxwell doubled down on her propaganda over Twitter. 

That is a big difference. It’s also a total lie. Sanders mentioned race, gender and discrimination multiple times at the beginning of his speech and long before the 23-minute mark, as anyone who actually watched it – which presumably includes all the MSNBC personalities on that panel who sat silently as this lie was broadcast – obviously knew was a lie. –The Intercept

In fact – Sanders mentioned race in his very first sentence – commending Shaun King for his fight against racial inequality. 

“All over this country – and I’m going to say a few words about it today and more tomorrow – people understand that we have a broken criminal justice system, and there are few people in America fighting more than Shaun to change that system,” said Sanders. 

Five minutes in, Sanders then says that “the underlying principles of our government” will not include “racism, sexism, xenophobia, homophobia, and religious bigotry.”

Immediately after, Sanders said that “the principles of our government will be based on justice: on economic justice, on social justice, on racial justice, on environmental justice.” 

Maxwell swears Sanders didn’t talk about it until 24 minutes in though… 

It is, needless to say, perfectly legitimate for MSNBC to devote its airtime to critiquing what Sanders said about race and gender: to claim it’s insufficient or insincerely held or superficial. But what is indisputably unacceptable is for MSNBC to outright lie about Sanders’ speech by stating categorically that “he did not mention race or gender until 23 minutes into the speech.” That is simply a lie, and it’s a lie that would have been instantly recognizable as such to anyone who watched the speech. –The Intercept

And as Greenwald also points out, it’s “utterly inconceivable that both MSNBC and Maxwell are unaware that what they said about Sanders’ speech both on air and later on Twitter is false,” as a flood of responses contradicted Maxwell’s lies. 

Following the publication of Greenwald’s article, Maxwell doubled down – tweeting: “Ok. I’ve rewatched since yesterday and while I can acknowledge that I missed the passing line at 6 minutes I stand by my point since talking about criminal justice is not the same thing as talking about race and gender and if you don’t get why Bernie won’t win….again.”

This isn’t the first MSM hit-job on Sanders. As we noted on Friday, CNN passed off Democratic political operatives as everyday people during a Monday evening town hall as part of his campaign for the 2020 election. For example, Sanders was asked a tough question about allegations of sexual harassment on his 2016 campaign by “American University Student” Shadi Nasab. What CNN didn’t mention is that she’s also an intern for a large D.C. lobbying firm, Cassidy & Associates. 

Several other questions came from “everyday people” who are really political operatives of some type or another, such as “Former biology professor” Tara Ebersole, who just happens to be the chair of the Baltimore County Democratic Party, and whose Husband was on Hillary Clinton’s leadership council in 2016. 

Abena McAllister was labeled by CNN as a “Mother of Two,” but failed to mention that she’s also the Charles County Democratic Central Committee Chair. Meanwhile, “Maryland Voter” Michelle Gregory turns out to be the chair of the Lower Shore Progressive Caucus. 

In short Sanders is a threat to establishment Democrats. He was in 2016, and he is now. 

Democrats would be wise, however, to take note of what happens when they push against someone so hard that the public becomes sympathetic to the person being bullied. They managed to transform Donald Trump into a billionaire martyr, after all. 

via ZeroHedge News https://ift.tt/2tP4fnj Tyler Durden

Wheelchair-Bound Yellow Vest Pepper Sprayed By French Cops; Another Man Shot In Face

As the Yellow Vest protests rage across France for the 16th straight week, shocking footage has emerged of police brutality. Apparently a Friday call for calm by President Emmanuel Macron doesn’t apply to police. 

In one clip, a French policeman appears to blast a wheelchair-bound man in the face with pepper spray. 

In another video, reportedly captured with a mobile phone camera, a concussion can be heard – after which the camera shows a man on the ground who had been shot in the face as first responders rush to assist him. 

French police have been firing ‘non-lethal’ 40mm rubber projectiles, which are supposed to be less harmful than rubber bullets. It is unclear what the man was hit with, or whether his injuries were life-threatening. 

Approximately 39,000 Yellow Vest protesters turned out across France over the weekend, including 4,000 in Paris according to official government figures – down from the 46,600 reported last week. 

“we keep protesting every Saturday because Macron doesn’t respond at all to the yellow vests’ demands. We want to rebuild our democracy and change today’s political system,” said Paris yellow vest coordinator Sophie Tissier. 

“Macron is contemptuous and … does not even try to understand that there are people that are living in great poverty and precariousness, and that there are so many inequalities,” she added. 

The protests initially began in November in opposition to a gas tax linked to climate change, and quickly evolved into a general anti-government movement. 

via ZeroHedge News https://ift.tt/2TebTqr Tyler Durden

Why Goldman Thinks The “Goldilocks” Rally Is About To End

With the latest positive report out of the US-China trade rumormill set to push futures solidly higher once they reopen on Sunday night, coupled with a breakout in 10Y yields from the recent descending triangle…

… as a result of growing speculation that the global macroeconomic headwinds have finally troughed following a handful of strong econ data releases including a higher than expected US Q4 GDP print and a strong rebound in China’s Caixin PMI, largely thanks to a gargantuan credit injection by China’s central bank, which has helped stabilize Chinese assets…

… and sparking a global reflationary impulse, the Fed may soon be trapped once again, as it was two months ago, only for the opposite reasons.

And as reflation rears its ugly head, denting the Fed’s plans to keep rate hikes on “pause” indefinitely and perhaps scuttling plans to prematurely end the Fed’s balance sheet runoff, traders may find out that just as markets did an overnight U-turn as “bad news was good news”, for the past two months as the “Goldilocks trade” made a return appearance, suddenly “good news may be bad news” as the Fed finds itself behind the curve once more, as the big market bears end up mauling Goldilocks.

That’s the point made by Goldman’s Christian Mueller-Glissman, who warns in a late Friday note he expects the “Goldilocks rally” to fade and bond yields to increase (even more) from here. His argument is simple: there is now a material disconnect between Fed pricing and the S&P 500. As he notes in teh chart below – one which we have shown repeatedly in the past, not only are markets pricing no hikes in the next 12 months, but they are pricing a cut in the next 2 years.

To Goldman, this seems inconsistent with the bullish message from risky assets and from the recent reflationary impulse and macro-economic trough. And even as Goldman economists expect 1 hike by the end of 2019 (which while contrary to the market’s dovish take is a far cry from the bank’s “4 hikes” call as recently as December, the bank notes that its US Financial Conditions Index (FCI) is back to levels from before the dovish Fed shift. In short: a pick-up in US inflation could drive concerns over the Fed resuming its hiking cycles, or drive a rebuild of term premia.

There is one “out”: Goldman concedes that “on the flipside, Fed may tolerate an inflation overshoot: the recent decline in real yields and increase in breakeven inflation are indicative of such a shift.” As a result, investors could eventually look to equities for ‘real yield’ exposure, resulting in a more reflationary rotation from fixed income to equities.

Of course, for that to happen, it would require the Fed to adjust its “inflation targeting” methodology, something which Fed speakers already hinted at over the past week. In such a case, it would be seen by markets as a “green light” to reflate another asset bubble, something which will make president Trump especially happy as it would result in new all time highs in the S&P on relatively short notice; of course, it will make the ensuing “mean reversion” that much more painful, although for Trump the only thing that matters is what happens to stocks – and the economy – ahead of the 2020 election. Should he win, an outcome that would be made more likely by another push higher in stocks, it would largely insulate Trump from any possible impeachment proceedings until 2024; should stocks then crash during Trump’s second term, well… he’ll cross that bridge when he has to.

via ZeroHedge News https://ift.tt/2TsPpBx Tyler Durden

Senate Poised To Reject Border Emergency, Provoking Trump’s 1st Veto

It’s looking increasingly likely that four Senate Republicans will join with the chamber’s Democrats (and the Independents who caucus with those Democrats) to pass a resolution to terminate President Trump’s national emergency before he has a chance to appropriate funding for the wall – drawing what many expect would be the first veto of the Trump era.

According to Bloomberg, Republican Sen. Rand Paul of Kentucky said Sunday that he would vote to block Trump’s emergency declaration, which seeks to appropriate some $7 billion to fund 234 miles of border wall. Paul’s vote would be the crucial fourth Republican vote needed to pass the resolution (which only requires a simple majority). He would join with Sens. Susan Collins, Lisa Murkowski and Thom Tillis.

Sen.

By opposing the resolution, Paul said he wasn’t trying to stymie Trump’s border-security ambitions; rather, he was solely seeking to protect the American system of “checks and balances” and avoid setting a dangerous precedent – a common refrain among Republicans who oppose the national emergency.

“I can’t vote to give the president the power to spend money that hasn’t been appropriated by Congress,” Paul said in a speech during the Southern Kentucky Lincoln Day Dinner on Saturday, the Bowling Green Daily Newsreported on its website.

“We may want more money for border security, but Congress didn’t authorize it. If we take away those checks and balances, it’s a dangerous thing.”

The House voted last week to block the emergency declaration. And while 13 Republicans joined all the Democrats to pass the resolution by a vote of 245-182, the margin wouldn’t be large enough to override Trump’s veto. The Senate now has two weeks to pass the resolution, but a vote is expected before the Senate leaves for a one-week break on March 15.

Trump declared the national emergency on Feb. 15 after signing a $1.375 billion bill to fund part of a physical barrier along the US-Mexico border wall, which was well below the $5.7 billion that he requested. With the emergency would pull money from the Treasury and Defense Department budgets to begin immediate construction on an expanded portion of the wall.

But, as Collins said, many Republican lawmakers are uneasy about being bypassed by Trump, and that others might join the opposition, according to the Hill.

Collins added that she’s had talks with “many” Republican senators who “are very uneasy about the precedent that the president’s action establishes and who were critical of similar actions that were taken by President Obama.”

[…]

Sen. Roy Blunt (R-Mo.), a member of GOP leadership, declined to say how he would vote saying that he wanted to see what other “options” Republicans may have.

But Republicans have acknowledged that the president will likely need to use his first veto if he’s going to win the political fight with Congress.

But, of course, urging Trump to consult with his attorneys and find “another way” to secure money for his border wall is ultimately a facetious proposition: They know that there’s no other avenue to build the wall so quickly (if there was, then Trump wouldn’t have shut down the government because he would have been able to secure the Democratic votes necessary to go through Congress).

Fortunately for Trump, while casting the veto might not be ideal, he can still move ahead with building the wall.

via ZeroHedge News https://ift.tt/2HdviRg Tyler Durden

Gillespie: Trump Just Might Have Won The 2020 Election Yesterday

Authored by Nick Gillespie via Reason.com,

The president’s speech at CPAC was a bedazzling mix of bravado, B.S., humor, and positive vision no Democrat will be able to top…

It’s way too early to be thinking this, much less saying it, but what the hell: If Donald Trump is able to deliver the sort of performance he gave today at the Conservative Political Action Conference (CPAC), the annual meeting of right-wingers held near Washington, D.C., his reelection is a foregone conclusion.

There is simply no potential candidate in the Democratic Party who wouldn’t be absolutely blown off the stage by him. I say this as someone who is neither a Trump fanboy nor a Never Trumper. But he was not simply good, he was Prince-at-the-Super-Bowl great, deftly flinging juvenile taunts at everyone who has ever crossed him, tossing red meat to the Republican faithful, and going sotto voce serious to talk about justice being done for working-class Americans screwed over by global corporations.

In a heavily improvised speech that lasted over two hours, the 72-year-old former (future?) reality TV star hit every greatest hit in his repertoire (“Crooked Hillary,” “build the wall,” “America is winning again,” and more all made appearances) while riffing on everything from the Green New Deal to his own advanced age and weird hair to the wisdom of soldiers over generals. At times, it was like listening to Robin Williams’ genie in the Disney movie Aladdin, Howard Stern in his peak years as a radio shock jock, or Don Rickles as an insult comic. When he started making asides, Trump observed, “This is how I got elected, by going off script.” Two years into his presidency and he’s just getting warmed up.

First and foremost, Trump was frequently funny and outre in the casually mean way that New Yorkers exude like nobody else in America. “You put the wrong people in a couple of positions,” he said, lamenting the appointment of Robert Mueller as a special prosecutor, “and all of a sudden they’re trying to take you out with bullshit.” He voiced Jeff Sessions in a mock-Southern accent, recusing “muhself” and asked the adoring crowd why the former attorney generally hadn’t told him he was going to do that before he was appointed.

Democrats backing the Green New Deal (GND) “are talking about trains to Hawaii,” he said. “They haven’t figured out how to get to Europe yet.” He begged the Democrats not to abandon the GND because he recognizes that the more its details and costs are discussed, the more absurd it will become. “When the wind stops blowing, that’s the end of your energy,” he said at one point. “Did the wind stop blowing, I’d like to watch television today, guys?” “We’ll go back to boats,” he said, drawing huge laughs when he added, “I don’t want to talk [the Democrats] out of [the GND], I just want to be the Republican who runs against it.”

He railed against Never-Trump Republicans: “They’re on mouth-to-mouth resuscitation,” he said, adding “they’re basically dishonest people” that no one cares about. He joked about being in the White House all alone on New Year’s because of the government shutdown. “I was in the White House and I was lonely, so I went to Iraq,” he said, recounting that when his plane was approaching the U.S. airstrip in Iraq, all lights had to be extinguished for landing. “We spend trillions of dollars in the Middle East and we can’t land planes [in Iraq] with the lights on,” he said, shaking his head in disbelief. “We gotta get out.” He then riffed on the generals he met there who, contrary to the Pentagon brass he dealt with, said they could vanquish ISIS in a week. He claimed to have talked with a general named “Raising Cane,” which might be Brigadier Gen. J. Daniel Caine, but Trump is the farthest thing from a details guy, right? “Sometimes I learn more from soldiers than I do generals,” he said, deftly moving from jokes to more-substantive discussions of policies or issues.

You can cover a huge amount of material in two-hours-plus, and Trump certainly did that. After speaking sympathetically of immigrants who want to come to the United States and saying that we need more people because the economy (well, his economy, as he takes credit for it) is doing so well, he immediately dismissed the Guatemalans, Salvadorans, and Hondurans traveling north in caravans across Mexico. In a bizarre display of simultaneous empathy and contempt, he talked at length about how female migrants are being systematically “raped” but also how the caravans were filled with criminals and drug dealers. It was “sad to see how stupid we’ve become” to think that the caravans are filled with good people. As he has been doing since his State of the Union address, he has been laying out a partial, inchoate case for a skills-based immigration program. He explained walking away from the table with North Korea even as he noted yet again that he has a great relationship with the dictator Kim Jong Un. In a long riff on trade policy, he invoked the “Great Tariff Debate of 1888” and how China “and everyone else” had been taking advantage of us until he started pushing back. He took time to talk about how no, really, the crowd at his inauguration was in fact historically large despite all publicly available evidence.

All in all, it was, in the words of Daniel Dale, the Washington correspondent for the Toronto Star, “one of the least-hinged speeches Trump has given in a long time.” It was indeed all over the place but like the weirdly wide-ranging and digressive speech in which he declared a national emergency, it was also an absolute tour de force, laying out every major point of disagreement between Republicans and Democrats (abortion, the Second Amendment, and taxes, among other things) while tagging the latter aggressively as socialists who will not only end the private provision of health care but take over the energy sector too. Those charges take on new life in the wake of the announcement of the GND and comments, however short-lived, by Democrats such as Kamala Harris, who at one point recently called for an end to private health care. And over 100 House Democrats have signed on to a plan that would end private health insurance in two years. For all the biting criticism and dark humor in today’s speech, Trump has mostly ditched the “American Carnage” rhetoric that marked his first Inaugural Address, pushing onto liberals and Democrats all the negativity and anger that used to surround him like the dust cloud surrounds Pigpen in the old Peanuts cartoons. “We have people in Congress right now who hate our country,” he said. “We can name every one of them. Sad, very, very sad.”

At moments, he seemed to be workshopping his themes and slogans for 2020. “We believe in the American Dream, not the socialist nightmare,” he averred at one point. “Now you have a president who finally standing up for America.” The future, he said “does not belong to those who believe in socialism. The future belongs to those who believe in freedom. I’ve said it before and will say it again: America will never be a socialist country.” That’s a line that may not work forever, but it will almost certainly get the job done in 2020.

None of this is to suggest that this speech wasn’t as fact-challenged as almost every utterance Trump has given since announcing his candidacy for the Republican nomination (go to Daniel Dale’s Twitter thread for a running count of misstatements of fact). He hammered trade deficits in a way that will remind anyone with an undergrad economics course under their belt that he fundamentally doesn’t know what he’s talking about. He misrepresented both NAFTA and the new trade bill he crafted with Mexico and Canada, and at the exact moment that hundreds of wearied listeners started leaving the ballroom at The Gaylord Resort and Convention Center, he claimed that not a single person had left their seat.

But the 2020 presidential race is not going to be decided based on which candidate is more tightly moored to reality. It’s going to be decided, like these things always are, by the relative health of the economy and the large vision of the future the different candidates put forward. As the economy continues to expand (however anemically compared to historical averages) and he continues to avoid credible charges of impeachable offenses, Trump is becoming sunnier and sunnier while the Democrats are painting contemporary America as a late-capitalist hellhole riven by growing racial, ethnic, and other tensions.

Trump isn’t the creator of post-factual politics in America, he is merely currently its most-gifted practitioner (oddly, his ideological and demographic counterpart and fellow New Yorker Alexandria Ocasio-Cortez may become a challenger to him on precisely this score). Trump may have next to no credibility in profoundly disturbing ways, but American politics has been drifting away from reality for the entire 21st century, when the 2000 election was essentially decided by a coin flip, the United States entered the Iraq War under false premises, and Barack Obama took home Politifact’s 2013 “Lie of the Year” award and dissembled unconvincingly in the wake of Edward Snowden’s revelations.

That Trump didn’t invent the current situation doesn’t mean we shouldn’t be concerned about it, but if he can continue to perform the way he did today at CPAC, it remains to be seen what Democratic rival can rise to that challenge.

via ZeroHedge News https://ift.tt/2HadJl2 Tyler Durden

Here We Go Again: US, China “In Final Stages Of Completing Trade Deal”

It’s deja vu all over again.

One week after Trump “surprised” markets and algos tweeting at 5:39pm on Sunday, just 21 minutes before futures opened for trading, that he would be “delaying the U.S. increase in tariffs now scheduled for March 1”, which predictably spiked futures heading into Monday and set the “optimistic” tone for a US-China trade deal which in turn helped push the S&P above 2,800, before said optimism fizzled by the latter part of the week as the “quadruple top” once again proved too much of a resistance level for US equities, the WSJ reported on Sunday afternoon that – once again – the US and China are “are in the final stage of completing a trade deal, with Beijing offering to lower tariffs and other restrictions on American farm, chemical, auto and other products and Washington considering removing most, if not all, sanctions levied against Chinese products since last year.”

According to the detailed report, which suggests it was leaked on purposes by someone high up in the administration with the clear purpose of once again pushing equities higher, the agreement is taking shape “following February’s talks in Washington” even as the WSJ’s sources “cautioned that hurdles remain, and each side faces possible resistance at home that the terms are too favorable to the other side.”

Even so, and despite the remaining hurdles, with Trump now clearly eager to put the trade war behind him in hopes of pushing stocks to new all time highs despite USTR Lighthizer’s ongoing reservations for a quick and easy deal (as he explained last Wednesday before Congress), the WSJ notes that “talks have progressed to the extent that a formal agreement could be reached at a summit between President Trump and Chinese President Xi Jinping, probably around March 27, after Mr. Xi finishes a trip to Italy and France.”

As the WSJ details, as part of any deal, China will pledge to “help level the playing field”, including speeding up the timetable for removing foreign-ownership limitations on car ventures and reducing tariffs on imported vehicles to below the current auto tariff of 15%.

Beijing would also step up purchases of U.S. goods—a tactic designed to appeal to President Trump, who campaigned on closing the bilateral trade deficit with China. One of the sweeteners would be an $18 billion natural-gas purchase from Cheniere Energy Inc., people familiar with the transaction said.

Whether this will help Trump achieve his goal of trimming the US trade deficit is unclear, however what has become clear in recent months is that the trade war with China has only exacerbated the US trade balance which as we reported last Wednesday unexpectedly hit a record $79.5 billion as exports fell 2.8% and imports rose 2.4% in the last month of the year, resulting in the widest goods trade deficit in US history.

While a big picture agreement may be taking shape, the two sides reportedly continue to negotiate over issues involving Chinese industrial policy the U.S. argues gives Chinese domestic firms an advantage, especially state-owned enterprises. Last week, Robert Lighthizer said the provisions involving protecting intellectual property total nearly 30 pages out of a working document of more than 100 pages. Additionally, the WSJ notes that “U.S. and Chinese negotiators are also working on setting up a mechanism through which complaints by U.S. companies could be addressed. The plan under discussion calls for bilateral meetings of officials from both countries to adjudicate disputes. If those talks don’t produce agreement, Mr. Lighthizer has said, the U.S. could impose tariffs.”

One place where the current proposal may fall apart is that the US is pressing Beijing to agree not to retaliate in some cases if the U.S. levies sanctions: agreeing to this “ask” would be seen a a major concession for Beijing negotiators, who say they want to make sure the deal doesn’t turn out to be an unequal treaty for China of the sort imposed by Western powers in the 19th century. As such it is unlikely that Beijing will agree, especially in light of the Chinese stock market’s recent surge higher, which is seen by Beijing as validation that negotiating leverage is rapidly shifting in its favor.

Even so, WSJ sources warn sthat China hawks in the U.S. are concerned that enforcement measures may not be strong enough and will tie down the U.S. in endless talks.

“The whole process is a fraud,” said Derek Scissors, a China expert at the American Enterprise Institute, who argues the U.S. could better enforce its will by taking unilateral actions rather than getting hooked into consultations. Even Trump’s former chief strategist Steve Bannon is said to be urging his former boss to increase tariffs to pressure China to agree to tougher terms even if that meant lengthier negotiations and market uncertainty.

“For Trump to get the structural reforms he wants and the country needs could take the rest of 2019 to negotiate,” Mr. Bannon said.

As yes, but that appears to be too long for Trump who wants stocks to rise to new highs, even as he claims he achieved “victory” in negotiations with Beijing, which likely explains the carefully leaked and crafted WSJ article, which at least superficially appears to give Trump the upper hand should a deal be reached shortly, even if the core issues in the ongoing civilizational race between the US and China remain unaddressed.

Besides stocks, a key wildcard that remains unaddressed is whether conservative U.S. media, which has Mr. Trump’s ear, will pick up the criticism: should Trump face another strong barrage of complaints from his core base, he may well have no choice but to scuttle all attempts for fast-tracking a deal.

* * *

Meanwhile, for the Chinese, linking the Florida visit to Xi’s European trip is a way to blunt the impression that he is traveling directly to Mr. Trump’s estate to make concessions, the WSJ reports. In recent weeks, Xi has reportedly summoned senior officials from across China to warn them about “major risks” to the world’s No. 2 economy, and his administration issued new party directives demanding “unity and concerted action.”

A test of Mr. Xi’s authority will unfold over the next two weeks, when roughly 3,000 lawmakers gather in Beijing to review the government’s economic blueprint for the year.

In addition to the media’s reception, another major wild card in the U.S.-China negotiations is the impact of Trump’s failed summit in Vietnam with North Korean leader Kim Jong Un. U.S. officials said “they hope Mr. Xi learns from that episode that Mr. Trump would reject an offer he considers inadequate. But they fear Beijing might take the opposite lesson: that Mr. Trump is desperate for a win.“

As we discussed last week, Trump’s “failure to get a deal in Vietnam increases the pressure on him to get a deal with the Chinese,” said Fred Bergsten, founder of the Institute for International Economics in Washington.

It’s not just Trump who is desperate for grassroots, domestic support and not being seen as conceding too much to Xi: Chinese Vice Premier Liu He, the lead negotiator for Beijing, has been holding meetings with various ministries and agencies to build consensus within a bureaucracy that is anything but monolithic. Lighthizer, meanwhile, plans to go to Michigan this week to talk to the United Auto Workers. He told Congress last week that he has tried to incorporate specific requests from labor, business, farmers and lawmakers in a deal.

The rest of the analysis is simple as it has been beating to death over the past two months: any deal will be welcomed by markets, which have risen on the rumor that chances of an end to the trade battle were increasing, and will likely rise on the news as well, if only initially. But given the administration’s heated rhetoric on China—Lighthizer last week said he considered Beijing an existential challenge to the U.S.—the provisions are already being criticized as inadequate, especially measures to remake Chinese industrial policies.

Here are some of the details of the proposed deal:

In a move that would bolster administration’s claims of the benefits of a deal, China’s state-owned energy giant, China Petroleum & Chemical Corp., also known as Sinopec, would agree to buy $18 billion of liquefied natural gas from Cheniere, people familiar with the transaction said. However, the details are especially underwhelming when considering that Cheniere would start delivering LNG to the Chinese counterpart starting in 2023, or in about four years. Additionally, not US but Chinese banks could provide financing as part of the deal in the range of $3 billion to build additional facilities to meet the demand. The deal is still under negotiation and isn’t completed. Since China recently hit U.S. LNG imports with 15% tariffs as part of the trade war, Beijing has been buying the product mainly from Qatar, Australia and Malaysia.

“That would be a strong signal that there will be other (contracts) to follow,” said Charlie Riedl, executive director of the Center for Liquefied Natural Gas, a trade association.

Other purchases, predictably, include soybeans and other agricultural goods – predictably, because this has been repeatedly leaked in recent weeks. Beijing has also discussed reducing tariffs and other barriers that have limited the sale of American-made chemicals and agricultural products, such as ethanol, which now face 70% Chinese retaliatory tariffs; an ethanol byproduct, dried distillers grains, which is used to feed cattle; and polysilicon, a raw material in solar panels that was hit with 57% tariffs as part of an earlier trade fight with China.

* * *

Setting the stage for the WSJ article, after the close on Friday, Trump tweeted that he asked Beijing “to immediately remove all Tariffs on our agricultural products (including beef, pork, etc.)” in part, because he last week scrapped plans to raise tariffs on $200 billion of Chinese goods to 25% from 10% on March 2 as scheduled. As a result, any Chinese concession by scrapping some agri tariffs will be immediately pitched by Trump – perhaps as soon as 5:40pm on Sunday afternoon – as a confirmation of his “victorious” negotiating style.

And yet, even the WSJ admits that there has been less progress on other issues dividing the two nations – arguably the far greater sticking points  – especially China’s industrial policies and subsidies. Beijing considers that support crucial to its state-led development plan and maintaining the Communist Party’s rule.

 Yang Guangpu, an associate research fellow at the Development Research Center, a think tank under China’s State Council, said Beijing is taking steps to enable state companies to operate more like commercial entities.

“China is carrying out [state-company] reforms in an orderly fashion, and won’t change the pace because of the trade tensions with the U.S.,” Mr. Yang said.

On its side, the WSJ sources say that Beijing has pledged to remove “market distorting” subsidies, but some in the administration consider that insufficient because Beijing doesn’t specifically enumerate its subsidies, at the central government and local level, and specify which ones it will eliminate.

So while not only major issues in the ongoing feud between the US and China will remain unresolved, and a full-blown enforcement mechanism is still TBD, the immediate impact is already being felt and while futures have yet to open, both the Australian dollar and the Chinese Yuan, barometers of “trade deal optimism”, jumped in early Asian trading: the AUD rising 0.5% to 71.15 cents, while the offshore yuan gained 0.2% to 6.7003 per dollar.

Expect futures to once again follow higher once they open for trading, because to the algos which have a memory of a few millisecond, there is no such thing as “deja vu all over again.”

via ZeroHedge News https://ift.tt/2VzvH4e Tyler Durden

Kupperman: “Can’t Spell Felon Without Elon”

Submitted by Harris Kupperman, founder of Praetorian Capital, courtesy of Adventures In Capitalism

For Part I Click Here

This may surprise people, but accounting isn’t a black and white endeavor—there’s actually a lot of gray area—particularly when you deal with accruals and estimates for future events. This is the reason that two very similar companies can report very different short-term results. What is the useful life of equipment from a depreciation standpoint? What is the eventual cost of environmentally remediating an oil well? What assumptions should you use for a pension fund’s performance and discount rate? Two well-meaning CFOs may come to two very different sets of assumptions. The assumptions used are often colored by the CEOs goals. Is the company trying to smooth earnings and play a “beat the quarterly estimate game,” or are they manipulating the numbers to create short term earnings for a capital raise? What if the business plan mostly focuses on a vindictive desire to squeeze the shorts?

Most accountants are, by nature, focused on accuracy and take the conservative route when offered two paths. However, when a corporate culture is based on pushing the envelope including; knowingly selling defective products that kill people, ignoring obvious workforce safety issues and cutting corners to hit aggressive Twitter boasts to promote the stock, you’d have to think that pushing on the financials would fit right in—at least no one dies when the numbers are inflated.

Tesla continues to gain market share in safety violations. They have more violations than 10 large plants in USA combined.

Fortunately, financial statements are numbers based. You can tease the numbers, review the estimates used and reach your own conclusions as to their accuracy and ulterior motives. Look at my Q3 Tesla piece if you want to get some clarity on how this is done.

With the 10-K now released, we get to look at new data. Take depreciation for instance. In 2018, they lowered the rate of depreciation on Model S & X tooling by 30% from 250,000 to 325,000. From the financials, it’s hard to tell exactly how much capitalized tooling was related to the S & X but it’s likely between $500 million and a billion as total year-end tooling at cost was $1.398 billion and we know that Model 3’s are mostly built by hand in a tent.

Ironically, the Q4 shareholder letter made a point of noting this increase in gross margin. Let’s just say cost reductions weren’t actually responsible for the change.

Gross margin of Model S and Model X declined very slightly compared to Q3, which was in line with our guidance. Further cost reductions partially offset lowered prices in China as well as other negative factors. For full year 2018, Model S and Model X non GAAP gross margin improved by over 500 bp and GAAP gross margin improved by over 300 bp compared to 2017, mainly due to significant cost reductions. (Q4/2018 Shareholder Letter)

Of course, accounting works in funny ways, if these tooling assets were already depreciated by 50% at the time of the accounting change, then the reduction in depreciation cost per vehicle would be twice the magnitude (noted above)—at least for a few quarters. While this would adjust through the financials over time as new capital is added to the depreciable base, it does serve to increase GAAP earnings dramatically in the short run.

Let’s look at a bigger driver of earnings.

Our current and future warranty reserves may be insufficient to cover future warranty claims which could adversely affect our financial performance. Subject to separate limited warranties for the supplemental restraint system, battery and drive unit, we provide four-year or 50,000-mile limited warranties for the purchasers of new Model 3, Model S and Model X vehicles and either a four-year or 50,000-mile limited warranty or a two-year or 100,000- mile maximum odometer limited warranty for the purchasers of used Model S or Model X vehicles certified and sold by us. The limited warranty for the battery and drive unit for new Model S and Model X vehicles covers the drive unit for eight years, as well as the battery for a period of eight years (or for certain older vehicles, 125,000 miles if reached sooner than eight years), although the battery’s charging capacity is not covered under any of our warranties or Extended Service plans; the limited warranty for used Model S and Model X vehicles does not extend or otherwise alter the terms of the original battery and drive unit limited warranty for such used vehicles specified in their original New Vehicle Limited Warranty. For the battery and drive unit on our current new Model 3 vehicles, we offer an eight-year or 100,000-mile limited warranty for our standard or mid-range battery and an eight-year or 120,000-mile limited warranty for our long-range battery, with minimum 70% retention of battery capacity over the warranty period. In addition, customers of new Model S and Model X vehicles have the opportunity to purchase an Extended Service plan for the period after the end of the limited warranty for their new vehicles to cover additional services for up to an additional four years or 50,000 miles. (2018 10-K)

Apologies as that’s a lot of boring legal language, but it’s important for what follows. Servicing warranties is a major cost for an automaker. Naturally Tesla is pushing the envelope here as well.

Note the charge to provisions in the Q2 “big bath” quarter followed by the gutting of provisions afterwards

Now, I’ll admit that this calculation isn’t the world’s cleanest number. There are solar systems and energy storage included here that have their own metrics, there’s a change in vehicle mix to include more Model 3 with a lower price point. I get all of this. However, a shift in vehicle mix shouldn’t move warranty cost by almost $600/car from the 2017 average of $2,409/car to the Q4 number and I’m pretty confident the mix in Q4 was quite similar to Q3, yet the accrual dropped by $400/car. Only deceptive accounting could do that—especially as Q3 was almost in line with prior accrual levels.

Thinking of warranty accruals in a different way, in Q4, Tesla spent $60.75 million on warranty costs or an annualized rate of $243 million a year or $486 per car based on approximately 500,000 cars on the road by year-end. Given that the warranty is 8 years on the battery and drive unit (the most expensive parts of the car), the 8-year cost would work out to an anticipated cost of $3,888 per car, yet Q4’s accrual for warranty of $1,833 would work out to only 47% of the actual expected cost. But wait, there’s more!! The average fleet on the road is around 2 years old today. If batteries and drive units are going to fail, it’s as they age, not when they’re young. $3,888 is the best case scenario for total cost—the likely cost is DRAMATICALLY WORSE!! I wouldn’t be surprised if the real number is well over $10,000—meaning that Tesla wasn’t profitable for the only two quarters that they claimed to be profitable. Is it any wonder that Tesla has choked off spending on vehicle servicing and it now takes months to get any parts for a car? Even while underspending on their warranty costs, they’re still under-reserved dramatically!!

This leads to the obvious question, “Kuppy, I get it, auto OEM calculations are convoluted and these guys are cheating a bit, but isn’t this a cash flow generation story now? Look at how cash generation has inflected positive in the past 2 quarters?” To that I say that they’re likely gaming the cash numbers too, just like with the accruals.

At the end of Q4, Tesla claims they had $3.878 billion of cash including restricted cash. At the end of Q3, that number was $3.123 billion for an average cash balance of $3.502 billion. During the quarter, they earned $7.348 million in interest income or an average rate of interest of 0.84% despite the fact that money market rates were in the mid-2s for the quarter. I understand that some cash is needed for operating the business and some is restricted or overseas but they’ve earned about a third of what they should have. Either they’re hopelessly incompetent at cash management, or that cash wasn’t really there all quarter and shows up only at quarter end due to some transaction designed to pad the balance sheet with cash. While the low interest income is not a smoking gun, it shows something just isn’t what it claims to be either. For a point of reference, in Q3, they had a blended 1.00% yield on average cash balances despite average prevailing interest average rates being lower during that quarter. Did they suddenly get worse at cash management or are they playing more games with the cash balances?

Ponzi Schemes are like sharks, as soon as they stop swimming forward, they drown. This is because well run Ponzi Schemes use accruals to hide costs in the present that only pop up in the future. If your revenue numerator is growing, your costs on the denominator side will stay constant or decline as a percentage of revenue as they’ve been deferred—leading to margin growth. When revenue slows or goes in reverse, the fraud collapses. When accruals catch up, earnings will always inflect downwards—that’s why it’s so important to watch what’s happening with revenues.

I can keep pointing to obvious issues with the numbers (don’t get me started on the VIEs or how they’ve been capitalizing their vehicles to shift them into PP&E to increase their earnings or how they’ve under-reserved for liabilities throughout their leasing assets) but this piece is long enough already. Tesla has squeezed the numbers as hard as they can be squeezed. Is there a bit more lemonade in there? Maybe. Once you’ve crossed the red line, you might as well keep squeezing until someone catches you. Tesla seems to be at that point today. Tesla had 2 CAOs quit last year; they’ve had 3 CFOs in as many years. Anyone anywhere near the numbers flees at the first opportunity. Clearly, the accountants think that the lemonade is already quite toxic.

Going back to the shark analogy, when revenue inflects negatively, these accruals will catch up with Tesla quite rapidly. Watch monthly vehicle sales. January was awful. February was worse. They just fired all the sales people—how can March be any better? Tesla is imploding. It’s over and it will soon become obvious to everyone. Before, as a short, you had to use logic against a well-orchestrated stock promote complete with highly manipulated numbers. They can’t fake the numbers as revenue declines and they can’t promote the stock with only bad news coming. I added even more puts and put spreads this Friday.

The Gigafraud is about to detonate!!!

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Satyajit Das: The CDO Bomb That Blew Up In 2008? There Is A New One

In recent months, with the investor spotlight increasingly falling on the “leveraged loan problem”, or the fact that there are now more leveraged loans outstanding – most of them offering virtually no covenant protection to investors and effectively stripping them of their “secured” position in the capitalization waterfall thus making them pari passu with high yield debt – than junk bonds, there has been a resurgence of discussions whether CLOs are the next “ticking timebomb”, and whether Collateralized Loan Obligations which have emerged as the primary source of demand for incremental loan issuance, will be the new CDOs, which catalyze a systemic crash.

In an attempt to short-circuit such concerns, two weeks ago Barclays published a “CLO mythbuster” piece, in which it first noted that since 2008, Bloomberg, the Financial Times and even Hollywood have provided the general public with myriad causes of the Great Financial Crisis (GFC), “rarely failing to include a layman’s introduction to CDOs and how they played a major role”, and noting that “more recently, this conversation has grown to include comparisons to today’s CLO and leveraged loan markets, with premonitions of another GFC brewing just a decade after the last with CLOs acting as an accelerant.”

But first, this is Barclays defines a CDO in general, and a CLO in particular:

The term CDO actually covers an array of structured vehicles backed by debt, whether that debt is leveraged loans (CLOs), high-yield bonds (CBOs) or even other structured products (CDO-squared). So, while CDO subsets may have somewhat comparable structures (an SPV issues debt tranches, AAA through equity, and buys assets), the performance of the underlying assets and the ability for the vehicles’ liabilities to match the cash flows generated by those assets have proved vital for the future performance prospects of structured products.

…

US CLOs currently own about 60% of the performing US loan market, while European CLOs own just under half of the European loan market since they also buy HY bonds. This represents a big change from the late 1990s when banks owned about half of the loan market. Other holders of US loans include mutual funds (15-18%), hedge funds/SMAs (14-18%), and a smaller percentage by BDCs (Business Development Companies), insurers and banks.

Incidentally, for those curious about the terms of a generic leveraged loans, these are debt instruments issued by companies like CenturyLink, American Airlines, Ziggo, and Altice. The loans are typically broadly-syndicated (BSL), rated BB/B, floating-rate (based on LIBOR/EURIBOR), have a soft-call period of 6-12 months, maturity of around 7 years (~4 year WAL) and facility size of about half a billion.

So in order to mitigate concerns about CLOs – which are synthetic structures that gobble up leveraged loan issuance – being the next crisis “accelerant”, Barclays presented  the “facts” for investors to use as a guide when planning for the next downturn, “instead of relying on media rhetoric.” Here is what Barclays said:

  • CLOs are not like other CDOs. The results speak for themselves – per Moody’s, the 10 year cumulative impairment rate of Global CLO tranches originally-rated AAA is 0.0%, while for global CDOs (ex-CLOs) it is 43.0%.
  • CDO lessons learned. From the CDO-era, we learned to avoid mark-to-market vehicles, to know the underlying assets, minimize correlations and understand the buyer base.
  • CLO structures have evolved. Post-crisis CLO deals tend to have less structural leverage, shorter reinvestment periods, more restrictions on asset holdings and greater focus on matching asset cash flows to liabilities.
  • CLOs are not forced sellers. CLOs are non mark-to-market vehicles that are incentivized to hold assets over the long term, rather than be forced to sell at the lows. Barclays also identified  two theoretical sources of forced selling: defaulted CLO liquidations are extremely rare and the CLO warehouse market is small in comparison to the outstanding CLO market.
  • CLOs are semi-forced buyers. Asset quality in CLOs is falling as a result of overall loan fundamentals decreasing, creating problems for CLO managers that continue to issue deals to satisfy investor demand and trade their portfolio, while keeping quality  test limits in-line.

Additionally, the bank also argues that there are no market-value triggers in CLOs (although it later concedes that  CLOs could technically become a forced seller should the CLO trip an Event of Default ) and tranches, specifically senior rated notes are typically held by longer-term, unlevered capital investors like banks, insurers and money managers (mostly Japanese). Additionally, the collateral (most of which is priced on a daily basis) comprises primarily first-lien leveraged loans and some high yield bonds in European deals, with prohibitions against owning other CLO tranches and synthetic securities.

Furthermore, according to the British bank, the structures of CLOs themselves were re-configured after the crisis to fit enhanced rating agency methodologies and comply with new regulations (eg. the Volcker Rule). As a result, post-crisis CLOs tend to have less structural leverage (more credit enhancement (C/E)), shorter reinvestment periods (time to trade the portfolio), more restrictions on asset holdings (no structured finance assets) and greater focus on matching asset cash flows to liabilities (limits on currency differences, floating versus fixed holdings, assets maturing after CLO liabilities mature).

Despite Barclays’ spirited defense of CLOs and attempts to counter the “alarmist media rhetoric”, and talk down their systemic risk, one person disagrees – the same one who correctly predicted the 2008 financial crisis. According to a Bloomberg op-ed by Satyajit Das, “financial markets have short memories”, claiming – as the Barclays example above vividly demonstrates – that they’ve convinced themselves that CLOs are much safer instruments than the collateralized debt obligations, or CDOs, on which they’re based and which helped precipitate the 2008 crisis.

This is a big mistake because according to Das, “they’re wrong — and dangerously so.“

And while we already heard from Barclays why CLOs are not the threat the “media rhetoric” has made them out to be, here is Das’ take why CLOs may well be the next CDO “financial bomb” set to hit financial markets:

* * *

The Bomb That Blew Up in 2008? We’re Planting Another One

Financial markets have short memories. Of late, they’ve convinced themselves that collateralized loan obligations (CLOs) are much safer instruments than the collateralized debt obligations, or CDOs, on which they’re based and which helped precipitate the 2008 crisis. They’re wrong — and dangerously so.

Current CLOs outstanding globally total around $700 billion, with annual new issues of over $100 billion. That’s broadly comparable to subprime CDO volumes in 2008. Both Bank of England Governor Mark Carney and former Fed Chair Janet Yellen have warned about potential risks; regulators in Japan, where banks have been big CLO buyers, are particularly concerned.

The structure of CLOs is economically similar to CDOs. Each pools multiple loans to create synthetic, bond-like investments. Investors buy a slice (or tranche) of the underlying interest and principal cash flows of the portfolio. A defined order of which investors get repaid first and which bear the most losses allocates risk differentially.

High-risk CLO equity pieces, which are unrated, are first in line for losses and last for repayment. Less-risky subordinated or mezzanine pieces, typically rated anywhere between BBB and B, rank ahead of equity. Low-risk senior pieces, typically rated A or better, rank first for payments and only bear losses if the equity and subordinated pieces are completely wiped out.

CLOs, like CDOs, are designed to increase the leverage on a portfolio of debt. In other ways, CLOs are indeed set up to be safer. Rather than mortgages, subprime or otherwise, they repackage corporate loans, primarily leveraged loans, as well as consumer credit such as automobile loans. Investors in better-rated tranches have greater protection than they would have in CDOs, as higher levels of losses are required before they lose money.

Until recently, they could also rely on the fact that the banks structuring these packages had to retain a minimum amount of the riskiest securities to ensure that they had skin in the game, better aligning their interests with those of investors. The kind of dodgy innovations we saw in 2008 (remember CDO Squared?) haven’t recurred.

Nevertheless, many risks remain. How safe or not CLOs are is contingent on several factors: the credit quality of the underlying loans — as judged by the risk of default and the extent of loss if there is a default — as well as the correlation between default and losses within the portfolio.

Several aspects of this risk aren’t well-understood. The credit quality of the leveraged loans which underlie the bulk of CLOs is poor, typically not investment-grade. Borrowers are highly leveraged. The loans increasingly have minimal investor protection, with over 70 percent  lacking any covenants that would allow monitoring of financial condition and early intervention to manage problem borrowers. This exacerbates the risk of higher losses.

Investors assume that the portfolios are safer because they’re diversified. Yet, relative to mortgages, corporate-loan portfolios typically are made up of fewer and larger loans, which increases concentration risk. Leveraged loans are highly sensitive to economic conditions and defaults may be correlated, with many loans experiencing problems simultaneously.

Even buyers of high-quality tranches, who may be insulated from actual losses, face the possibility of mark-to-market writedowns, where the current value of securities declines. Relatively minor losses could impact such investors by reducing the protection for higher tranches and triggering rating downgrades. Similarly, general problems in credit markets, where margins increase, will decrease values.

Where investors are leveraged, falling values will result in margin calls. Hedge funds invested in riskier tranches will face withdrawal of funding and redemptions. Some investors, such as mutual funds, may be forced to sell because of loss or rating triggers.
Japanese banks, which have bought up to 75 percent of AAA CLO tranches and perhaps one-third of all CLOs, finance their holdings by borrowing dollars and euros in the inter-bank markets. Losses may create difficulties in rolling over funding, leading to a liquidity squeeze. As in 2008, that would accelerate declines in prices.

As we saw last December, problems with CLOs may result in a contraction of credit. CLOs purchase 50-60 percent of all leveraged loans, just as CDOs funneled funds into mortgages. The demand from CLOs has underpinned decreases in the price of credit and looser lending terms.

In the case of a downturn, the risk is that CLOs will create adverse feedback loops. Banks will be stuck with unsold inventories of underwritten loans. Falling prices, rising spreads and tightening credit availability will cause credit markets to seize up. Tighter credit will feed into the real economy, setting off losses, selling and price declines. Fears about the financial position of banks and investors will create contagion as depositors refuse to fund banks and investors demand their money back.

There are too many parallels to 2008 for comfort. Investors, many with uncertain expertise and weak holding power, have increased their exposure in the search for higher returns, which can be as high as 20 percent for the riskiest equity pieces. Bankers have aggressively underwritten leveraged loans and structured CLOs, earning around $2.8 billion last year. Built into this speculative episode, like its predecessors, is a euphoric flight from reality and a blindness to risks that continue to rise.

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Johnstone: How (And How Not) To Beat A Smear Campaign

Authored by Caitlin Johnstone via Medium.com,

Anyone who opposes western interventionism or thinks the poor are human beings is a Russian antisemite. If you disagree, it’s because you are a Russian antisemite, too.

Narrative is a funny thing. You can do everything right, cross all your ‘T’s and dot all your ‘I’s and color within all the official lines, but if you offend the powerful they can still rearrange the dominant narrative underneath you to kill your public influence.

In Venezuela right now some guy named Juan is being elevated to the leadership of the nation simply by the governments of other nations referring to him as “President Guaido” and denying the legitimacy of the actual guy who is running the Venezuelan government. The funny thing about that is if enough people believe it, it can theoretically work; the only thing keeping leaders in place is the agreed-upon narrative that they’re the leaders. If you can replace that narrative with a different one, as powerful people are currently attempting to do, in theory it is possible to effect a coup by pure narrative. You couldn’t ask for a more perfect illustration of the power of narrative control.

Smear campaigns work in the same way. Anyone challenging authorized narratives and the status quo of oligarchic hegemony can have their reputations destroyed by the lackeys of the plutocratic class which exerts massive influence over the political/media class, thereby neutralizing their ability to influence the public. If the public distrusts someone, they aren’t going to believe the narratives that that person is putting forward, even if those narratives are as sane as protecting the poor, opposing senseless warmongering, or defending Palestinian rights. In today’s political climate where smearing someone as a socialist or communist is increasingly ignored, the most effective smear campaigns are currently those which paint the target as a servant of the Kremlin or a hater of Jews.

British Labour leader Jeremy Corbyn’s populist leftism and support for Palestinian rights has gotten him targeted by an amazingly virulent smear campaign which journalist Jonathan Cook describes as “a perfect, self-rationalising system of incrimination — denying the victim a voice, even in their own defence.” A narrative has been promulgated with extreme aggression by the UK media that a horrifying epidemic of antisemitism has somehow overtaken the Labour Party under Corbyn’s leadership, and that Corbyn himself is (despite a lifetime of opposition to all forms of racism and bigotry) a closet antisemite as well.

Corbyn has responded to this fact-free smear campaign with capitulation after capitulation, most recently with the suspension of MP Chris Williamson on baseless accusations of antisemitism and a Twitter post yesterday of a video warning about antisemitic conspiracy theories. There is nothing inherently wrong with warning people about antisemitic conspiracy theories (which are toxic for a whole host of reasons), but the video Corbyn chose to share explicitly cited criticism of Zionism as an example of one such conspiracy theory. Zionism is the racist ideology supporting the continued existence of a Jewish ethnostate (much like the white ethnostate sought by American white nationalists like Richard Spencer), and it is the driving force behind the oppression and persecution of the Palestinian people today.

Validating this conflation of anti-Zionism with hatred of Jews is a capitulation to the demands of those who have been advancing this smear campaign, and it is the wrong way to fight it. It will never work, because the goal has never been to fight antisemitism, the goal has been to destroy Corbyn. It wouldn’t matter if Corbyn did everything everyone demanded of him and then posted a video of himself being whipped while screaming “Lord have mercy on this wicked Nazi Jew-hater!” on his knees — no amount of capitulation will end this campaign to eliminate him. The target is not antisemitism, the target is Corbyn. And the goal is not to tell the truth but to advance a narrative.

We are seeing the same type of smear campaign advanced against Congresswoman Ilhan Omar in response to her support for Palestinian rights, criticism of the US Israel lobby, and opposition to US regime change interventionism in nations like Venezuela. Currently she is again being smeared as an antisemite for making the demonstrably true claim that influential Americans push for allegiance to Israel, even while the GOP is taking a much smaller amount of flack for putting up a poster which literally depicts her as having ties to the 9/11 attacks. The fact that this brazen Islamophobia is receiving far less establishment media attention than fact-free accusations of antisemitism tells you that this smear campaign has nothing to do with fact and everything to do with narrative.

Yet still we see Omar attempting to appease these unappeasable smearmongers by publicly apologizing for perfectly truthful and accurate statements. The campaign to kill her influence will continue for as long as she continues to disrupt the official narratives of the US-centralized empire, so no amount of apologizing or sensitivity to concern trolling about antisemitism will ever stop the smears.

Congresswoman Tulsi Gabbard has also been subject to the same narrative control subversion for her opposition to US interventionism in Syria, Venezuela and Iran, her criticisms of disastrous US interventionism in the past in Iraq and Libya, and her calls to end the new cold war against Russia. American mass media has been flipping the fuck out ever since she announced her candidacy for the presidency and working overtime to smear her as a friend of the Kremlin and of Syria’s President Bashar al-Assad. During a recent guest appearance on The View, the Hawaii Representative was told by the ditzy daughter of late bloodthirsty psychopath John McCain that “When I hear the name Tulsi Gabbard, I think of Assad apologist.”

Gabbard’s response? Contributing to the war machine’s propaganda narratives about Syria.

“There is no disputing the fact that Bashar al-Assad in Syria is a brutal dictator,” Gabbard said. “There is no disputing the fact that he has used chemical weapons and other weapons against his people.”

Again, Gabbard is not being targeted by establishment mouthpieces like John McCain’s hellspawn because there is an actual concern that she holds some weird kind of loyalty to a random Middle Eastern leader on the other side of the world. Yet Gabbard capitulated to narratives she knows damn well are highly questionable in a vain attempt to appease her smearers.

This is not how you beat these creeps. The way to beat them is to attack the smear directly.

I’ve been the target of smear campaigns myself, and I’ve had blunders and successes in dealing with them. The fact that I’m still here speaking to a large readership without my influence having been killed off means I’ve picked up a clue or two about dealing with attempts to manipulate the public narrative about me, so I’m just going to share what I’ve learned here in case it’s useful to anybody.

Anyone who attempts to control the dominant narrative about who you are and what you stand for is trying to control you and your voice. It is a direct attack on your ability to influence your world, and if it succeeds you will necessarily be rendered impotent. It is therefore necessary to fight a smear campaign about you as directly and aggressively as any other attempt to rob you of your faculties or capabilities. This means not ignoring your smearers, nor capitulating to their demands, but engaging their smears loudly and publicly in a way that fully exposes what they are attempting to do to you.

If you are being lied about by someone attempting to influence public opinion about you, debunk that lie and loudly draw attention to it. If your position is being misrepresented by someone attempting to influence public opinion about you, correct that misrepresentation and call attention to how manipulative and dishonest your smearer is being. Explain their real motives for coming after you and dismiss their false stated reasons for the bogus justifications that they are.

They are trying to control the narrative about you, so the idea is to take back that control of your narrative. You don’t need to convince everyone that you’re right, you just need to prevent their malicious narrative about you from becoming the one everyone accepts as true because that’s what everyone else is saying. Most people believe things not because of facts and evidence, but because other people in their life believe those things. If you can create enough doubt in the malicious narratives being circulated about you and enough trust in your own, you can punch through that dynamic of unanimous consensus and keep your influence from being killed.

When you see it for what it actually is, a smear campaign is actually really gross to look at. People have a natural revulsion to manipulation and deception once they’ve seen it, especially when it’s done in the service of the powerful against the interests of the disempowered. All you need to do, then, is forcefully draw attention to what they’re doing to the point where their engagement in the smear campaign makes them look worse than they’re trying to make you look. This will kill their ability to manipulate public perception of you.

It sucks to have to do this. It feels really gross to keep having to wade into the muck and fight your smearers on their level, but the alternative is letting them control the narrative about you, which is the same as handing them control over your voice and, to an extent, your life. Because you can be one hundred percent certain that they will not cease working to kill public trust in you and your words if you just ignore them or be nice to them hoping that they will stop. Remember, they are not actually concerned about you being a Nazi/antisemite/Putin-lover/Assadist; they don’t actually care about fighting antisemitism in the way you or any healthy adult does. They have one simple goal, and that is to kill off your influence over the herd. Keep putting out your own message as well; don’t let fighting smears become the majority of your output, but don’t give them a single inch of control over the public narrative about you, either.

If you see someone smearing Corbyn, Omar, Gabbard, or any other target of establishment smear campaigns like Julian Assange, the best way to help them continue to disrupt the narrative matrix is to (A) refute the smear, then (B) aggressively expose the smearer for what they are and what they’re about. Whoever controls the narrative controls the world, and whoever controls the narrative about a particular thing controls that thing. If that particular thing is something or someone you care about, don’t let them control the narrative about it. Never treat an argument made in bad faith like it’s an argument made in good faith. Expose their lies and force a conversation about the despicable tactic that they are employing.

* * *

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American Farm Debt Reaches 1980s Crisis Levels: Agriculture Secretary

Debt among American farmers has increased to $409 billion, Agriculture Secretary Sonny Perdue warned Wednesday. That is up from $385 billion last year and is currently at levels not seen since the agricultural recession (farm crisis) of the 1980s, reported Reuters.

“Farm debt has been rising more rapidly over the last five years, increasing by 30% since 2013 – up from $315 billion to $409 billion, according to USDA data, and up from $385 billion in just the last year – to levels seen in the 1980s,” Perdue said in his testimony to the House Agriculture Committee.

Purdue told lawmakers: “Relatively firm land values have kept farmer debt-to-asset levels low by historical standards at 13.5%, and continued low-interest rates have kept the cost of borrowing relatively affordable.”

“But those average values mask areas of greater vulnerability,” he added.

The agricultural sector has experienced tremendous headwinds in the last five years amid deflationary trends in commodity prices, storms damaging crops, and more recent – supply chain disruptions into China due to President Donald Trump’s trade war.

“As producers are not able to cover year to year expenses with operating loans, they are forced into transforming operating loans into term debt which erodes their creditworthiness,” said Luis Ribera, an agricultural economist at Texas A&M University.

“On top of all that then we have the trade war which reduces the demand of US commodities given that tariffs make them more expensive and then depress the prices even more.”

US Department of Agriculture chief economist Robert Johansson said farm exports are expected to drop by as much as $1.9 billion this year, citing the deepening trade war.

China has been a significant buyer of corn, soybeans and other agricultural commodities for at least three decades, but since President Trump launched protectionist policies, Beijing responded by imposing tariffs on American agriculture products which caused trade between both countries to decline. While Beijing has promised to buy hundreds of billions of dollars in agricultural items, it has offered little relief to soybean farmers who are teetering on bankruptcy even with President Trump’s farm bailout money in hand. But as recent trade negotiations might result in an upcoming lasting agreement, it might not be enough to save hundreds of heavily indebted American farms from sliding into bankruptcy. 

The number of farmers filing for bankruptcy has soared to its highest level in a decade. And with high levels of debt, bankruptcies are expected to rise into the 2020s. 

Perdue said land values have helped some farmers maintain a low debt-to-asset ratio of 13.5%. However, in the next recession, land values are expected to dip, which could trigger a deleveraging period for farmers on par with the 1980s farm crisis.

via ZeroHedge News https://ift.tt/2Esysh3 Tyler Durden