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As if The Bank of England does not have enough on its plate – at first scaremongering Brexit and now doing its best to defend against its potential impact -a new report by research group Positive Money says the central bank must do more to combat climate change, including overt monetary financing of investment in a low-carbon economy.

As The Independent reports, the report argues that the bank’s mandate to secure financial stability “looks incoherent over time unless it considers the long-term viability of the economy”. That viability will be undermined unless the threat of climate change is tackled soon, the researchers say.

“The nature of climate change is such that either physical damage from weather or radical changes in technology and policy will occur in some combination, so action is needed now,” the report says.

In an interesting twist, the report begins by blaming The Bank of England (and other profiligate central banks) for printing too much money and worsening global climate change.

The bank’s record on climate change and says its programme of, in effect, printing billions of pounds to prop up the economy has disproportionately helped carbon-intensive companies that are choking the planet.

Under quantitative easing (QE), the bank has bought billions of pounds of debt from companies and the government.

This is supposed to increase demand for debt, which in turn lowers interest rates. Cheaper borrowing means more borrowing which is supposed to be used to fund economic activity.

But the researchers argue that QE has been actively harmful to efforts to combat climate change because the bank’s own criteria have been skewed towards buying debt from high-carbon sectors like manufacturing and utilities.

It also argues that the purchase of hundreds of billions of pounds worth of government bonds (debt) via QE has poured cash into the financial system, pumping up prices of assets such as stocks, but has had little impact on the “real economy”.

Which is true.

But then Positive Money say more money-printing is needed to solve global climate change…

To have a genuinely powerful, positive impact central banks should instead instigate “green QE”, which prioritises buying sustainable investments, the report suggests. This would directly stimulate activity in green sectors which have the potential to grow rapidly

A recent attempt to map the chains of direct and indirect financial exposure across the economy finds that feedback loops can make the effect of policy changes substantial.

Positive Money also calls for the Bank to look into effectively print money for the government to spend directly on green projects.

This method, known as “overt monetary financing”, is controversial but has been advocated in a variety of forms by respected figures including Lord Adair Turner, former head of the UK’s financial regulator.

Supporters argue that it simply dispenses with the artificial step of the government issuing debt to the markets in the form of bonds which are then bought up by the central bank.

The primary aspect of the BoE’s mandate is to maintain stable prices but it must also “support the economic policy of Her Majesty’s government”. That policy already includes sustainability as an aim.

Author of the report, Positive Money economist Rob Macquarie, concludes:

“The Bank of England’s mandate must be hardwired for sustainability and climate change.”

How long until The Fed is pressed to stop focusing on maintaining the S&P 500’s price change and instead buy Tesla’s direct from Musk and fund a solar panel of every new home… oh wait!

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Authored by Judith Bergman via The Gatestone Institute,

• If it is considered ‘objectionable’ in the West to talk about the factual consequences of migration, in Sweden it is now viewed as a crime.

• The kind of ‘integration’ that the mosque in Växjö is reportedly spreading to the local Muslim inhabitants is that Muslims are urged not to participate in the Christmas celebration of “kuffars” [a derogatory term for ‘disbelievers’], and Jews are, of course, mentioned as the enemies of Allah. The mosque’s school uses Saudi Arabian school curricula, and encourages women not to dress in ‘Western clothes’.

• “Silence has become an established norm in certain groups of inhabitants” in these areas…. there is pressure from relatives and religious communities, not to contact authorities, but to use the local alternative systems, such as the mosque, instead. Sometimes, the local criminal gangs even tell the residents to call them, instead of the police, to minimize the presence of police in the area. — BRÅ, the Swedish Crime Prevention Council

• It increasingly appears that it will be Sweden that integrates into Islamic culture.

In 2017, a Swedish police report, “Utsatta områden 2017“, (“Vulnerable Areas 2017”, commonly known as “no-go zones” or lawless areas) showed that there are 61 such areas in Sweden. They encompass 200 criminal networks, consisting of an estimated 5,000 criminals. Twenty-three of those areas were especially critical: children as young as 10 had been involved in serious crimes there, including ones involving weapons and drugs. Most of the inhabitants were non-Western, mainly Muslim, immigrants.

A new report “The Relationship with the Judiciary in Socially Vulnerable Areas” from BRÅ (Brottsförebyggande Rådet), the Swedish Crime Prevention Council, shows that more than half of the inhabitants of these areas — around 500,000 people — think that criminals affect people in the areas by scaring people from appearing as witnesses, from calling the police, from moving freely, and from intervening when witnessing vandalism. Residents fear repercussions from the local criminals, not only against themselves but also against family members.

Cars burn during a riot in suburb of Stockholm, on February 20, 2017. (Image source: YouTube/gladbecker82 video screenshot)

According to BRÅ, “Silence has become an established norm in certain groups of inhabitants” in these areas. The new report also notes the existence of parallel legal systems. 12% of the people living in these areas said that there is pressure from relatives and religious communities not to contact authorities, but to use instead local alternative systems, such as the mosque. Sometimes, the local criminal gangs even tell the residents to call them, instead of the police, to minimize the presence of police in the area. These alternative systems appear to handle all crimes that have to do with “reputation” and “honor” but also deal with other crimes, such as blackmail and theft. Relationship issues, including divorce and child custody, are also often handled by the local mosque. BRÅ points out that these alternative systems are often “markedly patriarchal”, disadvantaging the rights of women and children.

Since 2005, when the last such document was published, BRÅ, which is responsible for crime statistics in Sweden, has refused to release data about the ethnic identity of criminals. Nonetheless, Swedish newspaper Expressen recently published a report that out of 32 gang rape cases adjudicated in 2016 and 2017, 42 of the 43 of the rapists were migrants or descendants of migrants; 32 had been born abroad. 10 were born in Sweden, with one or both parents born abroad. The men were on average 21 years old at the time of the crime, and 13 of them under 18.

According to Stina Holmberg, the investigative and research counsel at BRÅ, there is no urgent need for a new study on migrant crime, although the last such study that BRÅ did was in 2005. What is needed now, according to Holmberg, is the “integration” of migrants, which she believes will end the crimes. According to her, the 42 migrants guilty of gang rape are a negligible part of all migrants, in relation to the 163,000 migrants who applied for asylum in 2015.

In February, Peter Springare, a Swedish police officer, said that gang rapes were a new cultural phenomenon in Sweden — a consequence of the last 10 to 15 years of immigration policy.

“There are also ethnic Swedes engaged in gang rape , but not in the same numbers as foreign-born offenders,” Springare said. For those comments, Springare was reported to the police, who announced that they would conduct an internal investigation into his remarks. The Secretary General of Sweden’s Law Society, Anne Ramberg, said that Springare’s comments were “almost racist”. If it is considered ‘objectionable’ in the West to talk about about the factual consequences of migration, in Sweden it is now viewed as a crime.

The Swedish government, however, seems undeterred by the risks of more potential gang rapes and migrant crimes. It has proposed legislation that will allow 9,000 unaccompanied and mainly male minors — approximately 7,000 of whom have reportedly turned out to be older than 18 and are thus not minors at all — who have had their asylum applications rejected, and who should have been deported, to get temporary residence permits in Sweden, if they plan to attend high school or are already enrolled in one. Notably, even those among the 9,000 whose identities are unverified — presumably because they have no papers — will be allowed to stay.

Both the police and the Swedish migration courts have heavily criticized the legislation, especially as it breaks with Swedish law, which requires people who want to stay in the country to be able clearly to identify themselves. Lowering this requirement reduces the ability of the Swedish authorities to know who is living in the country.

In response, the government has argued that the proposal is about allowing the 9,000 migrants to finish or apply for a high school education and not about asylum. So, it suddenly turns out that the 9,000 male migrants did not come to seek asylum, but to acquire a Swedish high school education. Who knew? Why grown men of unverifiable identity and from foreign countries should be allowed into Swedish high schools remains unanswered. Allowing the 9,000 ‘minors’ to stay is expected to cost the Swedish state nearly two billion kroner [$238 million; almost 200 million euros] in 2019 alone.

Bishop Fredrik Modeus of the city of Växjö has argued that Sweden should “reintroduce the possibility of residence permits in special and particularly devastating circumstances”, and that Sweden should view itself as a “humanitarian superpower”: “Allow the unaccompanied youth to stay. Not temporarily but permanently,” he said.

The mosque in Bishop Modeus’s city recently applied for permission publicly to broadcast its calls to prayer from a loudspeaker for three minutes, twice on Fridays. There are already two mosques in Sweden that publicly broadcast their prayers on Fridays, one in Botkyrka — where permission was granted in 2013 — and one in Karlskrona. The local Muslim leader, Imam Ismail Abu Helal, has said the call to prayer would enable Muslims to integrate better into Swedish society. “I welcome the application and look forward to hearing both church bells and prayer announcements in our city”, Bishop Modeus said.

Prime Minister Stefan Löfven refused to state an opinion on the matter of the Muslim call to prayer. He said that it “depends on the location of the mosque” and that it is up to the local municipality. In May, Växjö police decided that the mosque will be allowed to call to prayer every Friday for three minutes. In its decision, the police stated that the assessment had been based on traffic considerations, public order and safety. “No other aspects had been taken into account, such as the content of the call for prayer. Bishop Modeus said that the police’s decision was wise and would benefit integration”.

The kind of ‘integration’ that the mosque in Växjö is reportedly spreading to the local Muslim inhabitants is that Muslims are urged not to participate in the Christmas celebration of “kuffars” [a derogatory term for ‘disbelievers’], and Jews are, of course, mentioned as the enemies of Allah. The mosque’s school uses Saudi Arabian school curricula, and encourages women not to dress in ‘Western clothes’ but to teach their daughters to ‘dress decently from childhood’.

It increasingly appears, therefore, that it will be Sweden that integrates into Islamic culture. Recently, a Swedish court ruled in accordance with principles aligned with sharia law, when the jury — which had two Muslim members — found that a woman who had been violently abused by her husband could not be trusted because she came from a ‘lesser family’ than her husband and that it was “common” for women to lie about abuse. The jury also berated her for having involved the police, instead of solving the issue by consulting her abusive husband’s family. The case caused a scandal in Sweden and the two jury members were subsequently dismissed.

In another recent case, a 12-year-old Swedish Muslim girl was forcibly taken to Iraq and forced to marry her 22-year-old cousin, who reportedly raped her; after she returned to Sweden, she gave birth to twins. Her family forced her to return to Iraq to live with her ‘husband.’ His family then forcibly took her children away after finally agreeing to let her have a divorce. The children are still in Iraq. The Swedish court gave this man, an Iraqi citizen, custody of their now 10-year old twins.

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Russian President Vladimir Putin unveiled the auto section of a $3.6 billion (223 billion rouble) road-and-rail bridge over the Kersch Strait on Tuesday linking Russia to the Crimean peninsula – much to the consternation of Ukrainian officials who said the bridge showed “disregard for international law.” 

The bridge will be the longest dual-purpose span bridge in Europe, with the rail section expected to be completed at the end of 2019. 

The road stretch of the bridge was due to be completed by the end of 2018, but the opening was moved up at Putin’s request. He inspected the bridge in March ahead of the presidential election he won, saying it was important to have the link to the Black Sea peninsula open for the summer tourist season. –CBC

“Putin initiated this project himself. Many didn’t believe these plans were possible,” Kremlin spokesperson Dmitry Peskov told reporters on Tuesday before the ceremony, adding “This is an extremely important day from this point of view and in a practical sense and in symbolic terms.”

Drone footage captures opening day of Kerch Strait Bridge pic.twitter.com/cPSFZkuYKm

— Ruptly (@Ruptly) May 15, 2018

Putin drove the Russian-made KAMAZ dump truck in a convoy of vehicles across the 19-kilometre [11.8 mile] bridge over the Kerch Strait. Some Russians are calling it “Putin’s bridge,” designed to link Crimea into Russia’s transport network. –CBC

Putin, dressed in blue jeans, was met by cheering workers on the Crimean side who he told “At last, thanks to your talent, this project, this miracle, has happened.”  

[insert: 0917_Ukraine_Russia_infra_kerch_bridge Crimea Cropped.jpg , DdP3YlMX4AIxpCr.jpg ]

The Kerch Strait is a notoriously difficult place to build, with undersea mud volcanoes and seismic activity. pic.twitter.com/8X02gWSnpX

— RFE/RL (@RFERL) May 15, 2018

Ukrainian President Petro Poroshenko slammed Putin’s actions from Kiev.

“The illegal construction of the Kerch bridge is the latest evidence of the Kremlin’s disregard for international law,” Poroshenko said, adding “It is particularly cynical that its opening is happening on the eve of the latest anniversary of the deportation of the Crimean-Tatar people by the Stalin regime.”

Meanwhile, US State Department spokeswoman Heather Nauert says the United States condemns the construction and partial opening of the bridge, which it says was done “without the permission of the government of #Ukraine. Crimea is Ukraine.” 

The United States condemns #Russia’s construction and partial opening of the Kerch Strait Bridge between Russia and occupied #Crimea, which was done without the permission of the government of #Ukraine. Crimea is Ukraine. https://t.co/YjR4nserzN

— Heather Nauert (@statedeptspox) May 15, 2018

The United States condemns Russia’s construction and partial opening of the Kerch Strait Bridge between Russia and occupied Crimea, which was done without the permission of the government of Ukraine. Crimea is part of Ukraine. Russia’s construction of the bridge serves as a reminder of Russia’s ongoing willingness to flout international law.

The bridge represents not only an attempt by Russia to solidify its unlawful seizure and its occupation of Crimea, but also impedes navigation by limiting the size of ships that can transit the Kerch Strait, the only path to reach Ukraine’s territorial waters in the Sea of Azov. We call on Russia not to impede this shipping. -US Department of State

The bridge also drew criticism from Europe, after the French foreign ministry said “France condemns the construction by Russia of the Kerch Bridge, which deprives Ukraine of full access and the use of its internationally recognized territorial waters.” Meanwhile, a spokesperson for the European External Action Service said on Tuesday that the bridge was “another violation of Ukraine’s sovereignty and territorial integrity.” 

“The European Union continues to condemn the illegal annexation of Crimea and Sevastopol by Russia and will not recognize this violation of international law,” the spokesperson said.

Crimea broke away from Ukraine following a bloody US-sponsored coup, when in a March 2014 Crimean referendum 95% of participating voters were in favor of secession of the ethnically Russian region. Ukrainian officials disputed the vote, with then-acting President Oleksander Turchinov stating that “The authorities in Crimea are totally illegitimate, both the parliament and the government.” 

The State Department-backed fiasco led to the Obama administration imposing harsh sanctions on the Russian Federation, after Obama told Putin during a phone call that “Russia’s actions were in violation of Ukraine’s sovereignty and territorial integrity.” 

Putin pushed back, likening Crimea’s self-determined referendum to Kosovo’s breakaway from Serbia in 2008. 

“Regarding the March 16 referendum in Crimea, Mr Putin said that the decision to hold the referendum was in line with international law and the U.N. Charter, and was also in line with the precedent set by Kosovo,” the Kremlin said.

While the reaction on Twitter was mostly tepid, there were a few tweets of support for the bridge: 

1.000s of people have already used the Kerch bridge in the first few hours after its opening. A dream came true for all the Russian people.
Thanks @KremlinRussia_E#Crimea pic.twitter.com/d1Q2AJ6r4d

— Enrico Ivanov ☦ (@Russ_Warrior) May 16, 2018

#КрымскийМост https://t.co/mkFIT8nOzs – The Presidents full 16 minute drive across the Kerch Strait! Great achievement.🇷🇺 pic.twitter.com/a9AtqjFaQR

— Stephen Fenton (@StephenFenton88) May 15, 2018

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Authored by Alexander Mercouris via The Duran,

Russian President Vladimir Putin and Armenian Prime Minister Nikol Pashinyan – the latter recently installed as Armenia’s leader following nationwide protests – had their first bilateral meeting in Sochi on Monday on the sidelines of the Eurasian Economic Union summit.

The summary of the exchanges between the two leaders provided by the Kremlin’s website shows that Putin took the opportunity to remind Pashinyan of Russia’s economic importance to Armenia, whilst Pashinyan for his part thanked Putin for Russia’s neutral position during the protests, and reaffirmed Armenia’s continued friendship with Russia.

Pashinyan specifically reaffirmed Armenia’s continued membership of the Russian led Eurasian Economic Union, and spoke of deepening Armenia’s military ties with Russia.

President of Russia Vladimir Putin: Mr Prime Minister, colleagues,

I would like to welcome you to Russia and to congratulate you once again, this time in person, on your election to the high position of Prime Minister of Armenia.

First of all, I would like to say that we view Armenia, as everyone knows, as our closest partner and ally in the region. I am referring to both economic and security cooperation.

As you know, Russia is a leading trade and economic partner of Armenia. Its share is estimated at over 25 percent. Russia’s investment accounts for approximately 35 percent of all foreign investment in Armenia. Our trade has grown recently, also by some 25 percent. Armenian agricultural deliveries to Russia are growing at a fast pace, or more precisely, by 38 percent over the past few months.

Overall, this is very good progress and I hope that we will not just maintain but also boost it.

I would like to wish you every success on the post of the Prime Minister of Armenia. I hope that our relations will continue to develop consistently, just as they did before, and that we will continue to work together on the international stage as well as at international organisations, starting from the UN, where Armenia and Russia have always supported each other, and ending with regional organisations, both in security and economic development matters.

Prime Minister of Armenia Nikol Pashinyan: Mr President, thank you for your kind words.

It is very gratifying that, just a few days after I was elected Prime Minister of Armenia, I have this opportunity to have a meeting with you, because I think that we have things to discuss.

There is also something that does not need to be discussed: the allied strategic relations between Armenia and Russia. In general, I can assure you that there is consensus on this matter in Armenia, and nobody has ever questioned the strategic importance of Armenian-Russian relations, or ever will.

We are quite set on giving a fresh impetus to our relations – both in the political and trade and economic sense. We hope to develop our relations in the military technical sector as well as in other industries.

Many people from Russia visit Armenia, which is very good. I think Russians like Armenia very much, and Armenians also enjoy having so many tourists in Yerevan.

I would like to say that we highly appreciate the balanced position that Russia held in the course of our domestic political crisis, and I think it was a very constructive position; it is highly appreciated not only by our Government, but also in Armenian society in general.

Once again, please accept my best wishes on Victory Day. It was very interesting to watch the May 9 parade on Red Square. It is popular in Armenia and we are very impressed by the achievements that the Russian defence industry has made.

Thank you once again for this opportunity.

Pashinyan’s pledges of continued friendship to Russia will be judged cynically by many people, including by my colleague in The Duran Frank Sellers, who see them as nothing more than a device by Pashinyan to play for time whilst he sets about cutting back Armenia’s connections to Russia.

Many see hope in the fact that he plans to attend the Eurasian Economic Union summit next month and to meet with the Russian President Vladimir Putin, together with the fact that he admits that Armenia needs Russia as a military ally, but given his life story and participation in the events recorded here, there seems to be little real hope of that.

Is this a Western backed color revolution? It’s actually hard to cast doubt on that fact, given his connections with Soros funded NGOs who have as their purpose the remaking of Armenia into a NATO member state which looks somewhat less than fondly at Russia as the originator of Armenia’s woes.

With a perception that prosperity will surely be the Armenian inheritance of an integration into the Western political and economic bloc, which perception comes from anywhere but reality. It really can’t be doubted that this movement, led by a man with a history of hostility towards Russia and a long history of working in the interests of the US and its NGOs, is something that was hatched in Washington and delivered via the CIA’s vicarious operatives, the Open Society Foundation and its ilk.

The country’s post soviet poverty and Sargsyan’s perceived power grab are the grievances that were immediately capitalized upon in order to carry out this so called ‘velvet revolution’. Pashinyan says that he wants to maintain Armenia’s balancing act between the East and West, preserving ties and agreements with Russia while pursuing the partnership of the West, it should be noted that Saakashvili made a similar such promise upon assuming control of Georgia in a similar such incident.

Of course, he knows that he can’t be so bold as to immediately cut off ties with the Russians this early in the game, as Armenia is simply too dependent on Russia to make any real changes to Armenia’s foreign policy at this time, but that this represents his long term goal remains a matter to be seen.

I take the diametrically opposite view.  I believe that whatever Pashinyan may have said in the past his pledges of continued friendship with Russia and of Armenia’s adhesion to the Eurasian Economic Union are genuine.

After all, as Pashinyan himself said over the course of his meeting with Putin,

…….there is consensus on this matter in Armenia, and nobody has ever questioned the strategic importance of Armenian-Russian relations, or ever will…..

Given Armenia’s economic and geographic realities, and the rapid military build up in Azerbaijan, Armenia has no real choice, even if the Armenian people wanted such a choice, of which there is no real sign that they do.

Armenia’s relations with Russia were not an issue in the recent protests, which at no point took on an anti-Russian character.

As I have pointed out previously, that is in total contrast to the Maidan protests in Ukraine of 2013 and 2014, in which passionate hostility to Russia was the main driving factor.  That in itself is a major point of difference between the two sets of protests: the recent protests in Armenia and the Maidan protests in Ukraine.

I remain of the view that the Armenian protests were a strictly internal affair, provoked by the actions of the previous Sargsyan government, and have no geopolitical significance.

Moreover the very fact that – as Pashinyan says – there is “consensus” within Armenia about the importance of Armenia’s relations with Russia in itself places limits on what Pashinyan can do, even if he genuinely does seek to sever Armenia’s relations with Russia, which of course he denies.

Last but not least, there is the fact that even Western oriented commercially minded Armenians – and all Armenians, at least in their own estimation, are to an extent commercially minded – can see for themselves the huge commercial and economic benefits to them personally and for Armenia of Armenia retaining access to the vast Russian market through its membership of the Eurasian Economic Union.

By contrast it is impossible to see a good economic future for Armenia – or indeed (given the geopolitical realities) any real future for Armenia – if it severs its links to Russia.

For all these reasons, unlike Frank Sellers, I believe that when Pashinyan says he wants to maintain or even enhance Armenia’s relations with Russia, he means what he says.

He would be a fool if he didn’t, and whatever else he is, Pashinyan doesn’t seem to me to be a fool.

Time will show which of us – Frank Sellers or myself – is right.

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Russia’s new weapons for the modern battlefield, including an array of hypersonic missiles and the latest nuclear systems, will secure the country’s security for many decades, President Vladimir Putin said Tuesday at a conference with top military officials.

Speaking in Sochi, Putin said the brand-new weapon systems unveiled this year will significantly expand Russia’s military capabilities and “ensure a strategic balance for decades” with the United States.

President Vladimir Putin used his state-of-the-nation speech in March to deliver a stern warning to Washington that Moscow possesses hypersonic weapons that can render NATO’s U.S.-led missile defense system completely “useless.”

Underwater drones, hypersonic warheads, balls of fire, “menacing” ICBMs – the peak of Putin speech at the state-of-the-nation address in March. (Source: Tom Parfitt) 

“Efforts to contain Russia have failed, face it,” Putin announced in a two-hour speech at his annual state of the nation address in Moscow, which included computer simulations of new weapons including hypersonic systems, intercontinental missiles, and underwater drones.

Earlier this week, CNBC validated Putin’s claim of a hypersonic weapon the U.S. is currently unable to defend against, which the report indicates the weapon will be ready for war by 2020, according to sources with vast knowledge of American intelligence reports.

The sources told CNBC that Moscow successfully tested the hypersonic glide vehicle in 2016, which was configured to carry nuclear warheads. Sources said a third test was completed in October 2017 and resulted in a mishap seconds before obliterating its target.

The hypersonic glide vehicle, dubbed “Avangard” (also called ‘Objekt 4202′, Yu-71 and Yu-74), is fastened onto an intercontinental ballistic missile using scramjet engine technology. Once launched, the Avangard reaches speeds of Mach 20 with the capacity to carry both nuclear and conventional payloads.

Avangard video demonstration from Putin’s speech in March.

#Avangard Mach20 speed ultra maneuverable hypersonic glider vehicle 🇷🇺 #Putin speech
(deployed from ICBMs) pic.twitter.com/XSCPg5VEHY

— Plutonium General ☫ (@nukesn_missiles) March 1, 2018

Sources said it is still unclear whether the hypersonic glide vehicle will carry explosives, due to just Mach 20 capabilities can pack enough force to annihilate targets. In March, Putin said the Avangard strikes “like a meteorite, like a fireball.”

Putin said at Tuesday’s conference that Russia’s hypersonic program to produce the world’s most advanced weapons would remain a high priority. He mentioned in March that the missile entered series production.

“These kinds of boost-glide vehicles attack the gaps in our missile defense system,” Thomas Karako, director of the Missile Defense Project at the Center for Strategic and International Studies, told CNBC.

“There’s no time like the present to modify our current missile defense posture,” Karako added, saying it was “unfortunate that we have let Russia come this far.”

Sources familiar with Russia’s hypersonic program asses that the hypersonic glide vehicles equipped with “onboard countermeasures,” can defeat NATO’s U.S.-led missile defenses. The weapon is capable of sharp evasive maneuvers — making it virtually undetectable to radar.

The intelligence reports, which were released for government officials this spring, estimate that Russia’s hypersonic glide vehicles could be on the modern battlefield by 2020, a significant move on the geopolitical chessboard that would surpass Washington and Beijing in their capacity to yield an operational hypersonic weapon on the modern battlefield.

In March, the commander of the United States Strategic Command told the Senate Armed Services Committee that U.S. forces are unable to shield against a hypersonic weapon attack.

“We don’t have any defense that could deny the employment of such a weapon against us,” Air Force Gen. John Hyten, commander of U.S. Strategic Command, told the Senate Armed Services Committee. “Both Russia and China are aggressively pursuing hypersonic capabilities,” he added, noting that the U.S. has “watched them test those capabilities.”

Hyten suggested that the U.S. is powerless against hypersonic weapon threats and has to rely on increased deterrence to counter the threat.

Hyten added, “so our response would be our deterrent force which would be the triad and the nuclear capabilities that we have to respond to such a threat.” In other words, if Russia launches a hypersonic missile attack on the U.S., the Pentagon will respond with nuclear war.

On the geopolitical chessboard, it seems as Moscow declared checkmate with Washington via the development and rapid fielding of hypersonic weapons that render NATO’s U.S.-led missile defense system entirely worthless. America’s military-industrial complex recognizes this as a crisis and is willing to bankrupt the United States with unprecedented amounts of military spending to counter this threat. As for now, Russia has the upper hand in hypersonic weapons, which Washington is starting to realize the idea of American Hegemony is beginning to crack.

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Just yesterday we wrote that it was starting to feel like the movie Groundhog Day for Tesla when it comes to the company’s executive departures.  Now, there is again a distinct Groundhog Day feel to Tesla – but this time as it relates to U.S. National Highway Traffic Safety Administration (NHTSA) investigations.

Continuing in what has been an unprecedented storm of negative headlines for Elon Musk’s company that started a couple months ago, it was announced today that the NHTSA is going to be investigating a recent Tesla crash in Utah. Reuters reported:

The U.S. National Highway Traffic Safety Administration (NHTSA) said on Wednesday that it was sending a team to investigate the crash of a Tesla Inc vehicle last week in Utah that the driver said occurred while the car was in autopilot mode. It is the third Tesla crash that may be linked to the semi-autonomous Autopilot system being investigated by the government agency since January.

“The agency has launched its special crash investigations team to gather information on the South Jordan, Utah, crash,” the agency said on Wednesday. “NHTSA will take appropriate action based on its review.”

That crash, as described previously, involved a Tesla Model S sedan which smashed into a Salt Lake City fire truck while traveling at 60 miles per hour last Friday night. The driver said she was using autopilot at the time of the crash and suffered a broken ankle.

The big surprise, as the article points out, is that this is the third investigation that the NHTSA has launched into Tesla since January. This should be of concern for the company as the NHTSA has the authority to force the company into issuing recalls which, if costly enough, could be a financial hurdle that Tesla might have trouble surviving in its current financial state.

NHTSA is also investigating a fatal crash in March that involved a Tesla Model X using Autopilot. It is also probing the January crash of a Tesla vehicle apparently traveling in Autopilot that struck a fire truck. Both incidents were in California.

Last week, NHTSA also said it would probe a May 8 Tesla accident in Florida that killed two teenagers and injured another. Autopilot was not thought to play a part.

NHTSA can order a recall if it finds a defect poses an unreasonable risk to safety.

Certainly the timing of this NHTSA regulatory scrutiny couldn’t be worse for the company, because in addition to its precarious financials, the company main liason to regulators sch as the NTSB and NHTSA departed the company just days ago. 

Last Saturday, Tesla competitor Waymo announced that Tesla’s Matt Schwall has begun working for the self-driving car unit. According to Schwall’s LinkedIn Bio, he had been Tesla’s “primary technical contact” with both the NTSB & NHTSA, suggesting the company’s troubles with government regulators may be set to escalate.

Regulators aside, analysts have continued to question why the revolving door of executives continues and explore what the potential complications could be as a result. Needless to say, it isn’t good news for Tesla. 

Also as a reminder, on Sunday morning the WSJ wrote a scathing critique of Tesla’s autopilot,” In Self-Driving Car Road Test, We Are the Guinea Pigs” in which it questioned the validity of Elon Musk’s claims about Tesla’s safety record:

Tesla says that its cars with autonomous driving technology are 3.7 times safer than the average American vehicle. It’s true that Teslas are among the safest cars on the road, but it isn’t clear how much of this safety is due to the driving habits of its enthusiast owners (for now, those who can afford Teslas) or other factors, such as build quality or the cars’ crash avoidance technology, rather than Autopilot.

In the wake of a fatal 2016 crash, which happened when Autopilot was engaged, Tesla cited a report by the National Highway Traffic Safety Administration as evidence that Autopilot mode makes Teslas 40% safer. NHTSA recently clarified the report was based on Tesla’s own unaudited data, and NHTSA didn’t take into account whether Autopilot was engaged. Complicating things further, Tesla rolled out an auto-braking safety feature—which almost certainly reduced crashes—shortly before it launched Autopilot.

As the WSJ also notes, “there isn’t enough data to verify that self-driving vehicles cause fewer accidents than human-driven ones.” A Rand Corp. study concluded that traffic fatalities already occur at such relatively low rates—on the order of 1 per 100 million miles traveled—that determining whether self-driving cars are safer than humans could take decades.

For now, we’ll wait for the NHTSA’s verdict.

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Authored by Brandon Smith via Alt-Market.com,

It is often said that “other-izing” people overall can be dangerous and other-izing your enemies specifically can be tactically detrimental. For one, it can lead to a false sense of superiority over those people as you assert some kind of imagined genetic advantage. It can also lead to dangerous generalizations of vast groups as you categorize and pigeonhole millions as being exactly the same when this is rationally impossible. However, other-izing is perhaps the only option when faced with a very particular type of person embracing a very particular brand of ideology; other-izing can become a matter of survival.

I am of course talking about globalists.

Not the low level cronies and useful idiots within the globalist push or “movement,” because many of them simply represent a underlying gullibility or stupidity among people attracted to the inbred world of academia. Instead, I’m talking about the people behind the curtain; self proclaimed “globalists” or internationalists that have positioned themselves into strategic power centers.

I am talking about the people that influence or outright control government policy as they stand over the shoulders of supposedly freely elected officials. I am talking about the people that influence economic security or insecurity through unaccountable central banking conglomerates. I am talking about the men and women that desire to dictate the fate of billions.

These people are not easily identified by anything other than their rhetoric and actions. They are made up of multiple ethnic groups. They herald from all corners of the planet. They do not subscribe to any one spiritual doctrine, but they do publicly devote themselves to many different religions as a means to “fit in” with the common citizen. Globalism IS their religion. And their god? Well, they see themselves as gods.

To be a globalist, though, one has to do more than merely subscribe to the tenets of globalism; there is a matter of character traits and actions which must be examined.

After studying the behavior of globalists and their organizations for quite some time, I have noticed that their psychological patterns tend to match with a narrow band of people that are best described as “criminally insane.” More accurately, globalists behave like high-functioning narcissistic sociopaths and psychopaths. But what are the traits of such people? Let’s take a look at some of them…

False Sense Of Superiority – Self-Aggrandizement

Every person wants to be seen as important or unique. But, narcissistic sociopaths believe themselves to be entitled to special treatment and see themselves as above the laws and niceties of normal society. They sometimes seek to prop up this attitude through “accomplishment;” scratching for positions of power and influence in order to reinforce the notion that they are special compared to others.

Of course, power is usually an artificial construct because the only power we have over others is the power they give us, knowingly or unknowingly. Power does not make one special. The narcissistic sociopath does not make such distinctions, however. He/she only distinguishes between the people who strive for dominance and everyone else. In their minds, people that covet power are a superior subspecies, while people who do not covet power are considered bugs.

Frankly, I see no reason why we should not make the same absolute statement, only in reverse.

Narcissistic sociopaths and psychopaths are stricken with visions of assumed greatness. They do not view the content of their accomplishments as necessarily important. Meaning, they think they were born great, therefore, it is not for them to accomplish anything that serves to help others or advance the knowledge of humanity. They don’t care about proving their greatness through legitimate achievement, they only care that people BELIEVE they are special, that they are anointed.

Manipulation And Coercion

A narcissistic sociopath usually prefers to get what they want easily. They expect people to hand them adoration and control automatically. But if they don’t get what they want as a matter of course, they will use any means at their disposal.

This usually includes the threat of force or the use of force, the use of torture, the use of elaborate lies and schemes to push their target into a corner (to make them behave in a specific manner), the use of psychological conditioning (molding behavior, usually through fear responses) and also the use of “gaslighting” (accusing the target of being “crazy” if they do not subscribe to the narcissist’s twisted view of the world).

Of course, this kind of disturbed person is never actually satisfied, even when they do get what they want. They always want more, there is always something else they need to fill the endless void within.

Lack Of Empathy For Others

Not all narcissists are sociopaths, but most sociopaths are narcissists. When we speak of narcissists, it is important to remember that there are varying degrees of this psychological cancer. When I mention globalists in particular as being “narcissistic,” I am referring to their propensity to be high functioning narcissists with sociopathic tendencies. In other words, they are narcissists that not only have an inflated sense of self worth, but they are also devoid of empathy and conscience. They are willing to harm others to any degree to get what they want in the moment as long as they think can avoid consequences for doing so.

There is also the matter of distinction between sociopaths and psychopaths. This is a little hard to describe being that they are so similar in many respects. I would put it this way — while sociopaths chase a goal and are willing to step on people to get to it, psychopaths step on people even when they don’t have a goal in mind. That is to say, the psychopath enjoys the act of destruction; what they want most of all is other people’s pain.

Sociopaths and psychopaths both appear to permeate the ranks of globalist institutions. Some of them want to build an idol to themselves and don’t care who they harm in the process. Some of them derive great enjoyment from simply hurting as many people as possible.

Desperate Need For Adoration

It is not enough for the narcissistic sociopath to attain a level of respect through coercion. Ultimately, what they want is for the lowly masses to voluntarily ACCEPT their greatness as absolute, as an obvious and undeniable fact of life. What they want is reverence and devotion. As mentioned earlier, they want to be treated as gods by the people around them, and if they are particularly ambitious, by everyone in the world.

This is a strange dynamic indeed, for it requires a highly elaborate set of schemes and manipulations. If one is not a great person, let alone god-like, the amount of psychological conditioning needed to convince people otherwise is substantial. This makes the narcissistic sociopath a potential slave to his/her own incessantly engineered conspiracies; lies pile upon lies and schemes upon schemes in the search for something they will never truly achieve.

Globalists Are Psychologically Broken Non-Humans

In the world of alternative analysis and investigative journalism it is not uncommon to run into people who attribute an otherworldly status to globalists. Some people see them as a representation of biblical Apocalypse — minions from the depths of hell. Others see them as literally alien — interdimensional beings posing as human. And while many will laugh at such people as fringe conspiracy freaks, I think it is important to understand why they see the globalists this way.

When faced with true and organized evil empty of all care or remorse, one may be tempted to apply supernatural explanations.  I’m not sure that I am against the idea.

Globalists exhibit most if not all the telltale signs of narcissistic sociopaths, including being devoid of conscience and moral compass. While there are many definitions of what it is that makes us human, there is a kind of universal requirement regardless of culture; namely the requirement of something like a soul.

What makes a soul? How about a basic desire to do right by others even if that means not getting what we want all the time?  This is a good starting point, but there is more to it than that.

Psychologists and scientists have over many decades found a pattern of inherent character traits hardwired in the human psyche, traits present in humans from the moment of birth that stand outside of the influences of social environment. Carl Jung was the foremost expert in this field of “archetypal qualities,” with a vast catalog of case studies from around the world including studies in tribal Africa. An important part of archetypal or inborn knowledge and traits is the notion of good and evil; we are born understanding that certain behaviors are constructive while others are destructive and abhorrent. This is most likely the source of what we call “conscience.”

Unfortunately, not all people are born with a conscience. In some people, the difference between good and evil or constructive and destructive behavior is treated as blurry or frivolous. Jung and other psychologists mark this subset of our species as “latent” sociopaths and psychopaths. Together they make up around 10% of any given culture or group. Many of them remain “latent” and more or less harmless for their entire lives unless certain unstable environmental conditions provide fuel for their malfunction. Around 1% are born as full blown sociopaths and psychopaths. These are what I would call the “non-humans.”

This is because high level narcissism and sociopathy are not traditional “mental illnesses,” but ingrained character traits. A narcissistic sociopath cannot be “cured” of his ailment because it is not an ailment, it is who they are. If you were to take the narcissism and sociopathy away from them, there would be nothing left to their personality.

When a normal person comes in contact with someone that has no inherent conscience there is an immediate recoil; a sense that they have just stumbled across a monster. This is not an exaggeration, this is entirely accurate.

High level narcissists and sociopaths are physically human of course, but if we were to peer in at a visual representation of their psyche, we would find a barren wasteland — a place where ghouls lurk. They do not dream as normal people dream. They do not feel joy in the manner normal people do. They do not feel fulfillment in the things that commonly lift up the rest of us. They are incapable of love for others. They are incapable of regret for their actions, and only ever feel regret over failing to get what they want. They do not see other people as individuals, they see them as tools to be exploited.

Being sociopathic though does not mean that they are ignorant of what makes the rest of us function. On the contrary, sociopaths are very good at identifying the personal desires and drives of others, and mimicking people in a way that makes them seem “human.” They are parasites by nature,and thus they have to be able to get close to their host victims if they are to survive.

The globalist dynamic is interesting in that it is an example of organized narcissistic sociopathy.  Globalists have stood at the forefront of numerous wars, economic collapses and tyrannies over the years, all ending in great suffering for the masses.  Contrary to popular belief, sociopaths and psychopaths DO work together towards a common goal as long as there is a sense of mutual benefit. In fact, these people seem to gravitate to each other in odd ways. It is my belief that globalist hierarchies actually seek out people with narcissistic and sociopathic personalities; that they do this deliberately when they wish to expand their ranks. These seem to be the only aspects that they all have in common.

It is quite a ‘conspiracy theory’, I know. But look at it this way, how else can we explain their tendencies and behaviors? If organized annihilation was an intrinsic value of humanity then we would have died out long ago. The globalists are not human, though. They are something opposite, and if you do not understand this core truth, they can be bewildering and terrifying.

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Over the last two years, academic researchers have identified various methods that they can transmit hidden commands that are undetectable by the human ear to Apple’s Siri, Amazon’s Alexa, and Google’s Assistant.

According to a new report from The New York Times, scientific researchers have been able “to secretly activate the artificial intelligence systems on smartphones and smart speakers, making them dial phone numbers or open websites.” This could, perhaps, allow cybercriminals to unlock smart-home doors, control a Tesla car via the App, access users’ online bank accounts, load malicious browser-based cryptocurrency mining websites, and or access all sort of personal information.

In 2017, Statista projected around 223 million people in the U.S. would be using a smartphone device, which accounts for roughly 84 percent of all mobile users. Of these 223 million smartphones users, around 108 million Americans are using the Android Operating System, and some 90 million are using Apple’s iOS (operating system). A new Gallup poll showed that 22 percent of Americans are actively using Amazon Echo or Google Assitant in their homes.

With much of the country using artificial intelligence systems on smartphones and smart speakers, a new research document published from the University of California, Berkeley indicates inaudible commands could be embedded “directly into recordings of music or spoken text,” said The New York Times.

For instance, a millennial could be listening to their favorite song: ‘The Middle’ by Zedd, Maren Morris & Grey. Embedded into the audio file could have several inaudible commands triggering Apple’s Siri or Amazon’s Alexa to complete a task that the user did not instruct — such as, buying merchandise from the music performer on Amazon.

“We wanted to see if we could make it even more stealthy,” said Nicholas Carlini, a fifth-year Ph.D. student in computer security at U.C. Berkeley and one of the paper’s authors.

At the moment, Carlini said this is only an academic experiment, as it is only a matter of time before cybercriminals figure out this technology. “My assumption is that the malicious people already employ people to do what I do,” he added.

The New York Times said Amazon “does not disclose specific security measure” to thwart a device from an ultrasonic attack, but the company has taken precautionary measures to protect users from unauthorized human use. Google told The New York Times that security development is ongoing and has developed features to mitigate undetectable audio commands.

Both companies’ [Amazon and Google] assistants employ voice recognition technology to prevent devices from acting on certain commands unless they recognize the user’s voice.

Apple said its smart speaker, HomePod, is designed to prevent commands from doing things like unlocking doors, and it noted that iPhones and iPads must be unlocked before Siri will act on commands that access sensitive data or open apps and websites, among other measures.

Yet many people leave their smartphones unlocked, and, at least for now, voice recognition systems are notoriously easy to fool.

There is already a history of smart devices being exploited for commercial gains through spoken commands,” said The New York Times.

Last year, there were several examples of companies and even cartoons taking advantage of weaknesses in voice recognition systems, including Burger King’s Google Home commercial to South Park‘s episode with Alexa.

While there are currently no American laws against broadcasting subliminal or ultrasonic messages to humans, let alone artificial intelligence systems on smartphones and smart speakers. The Federal Communications Commission (FCC) warns against the practice, calling it a “counter to the public interest,” and the Television Code of the National Association of Broadcasters bans “transmitting messages below the threshold of normal awareness.” However, The New York Times points out that “neither says anything about subliminal stimuli for smart devices.”

Recently, the ultrasonic attack technology showed up in the hands of the Chinese. Researchers at Princeton University and China’s Zhejiang University conducted several experiments showing that inaudible commands can, in fact, trigger voice-recognition systems in an iPhone.

“The technique, which the Chinese researchers called DolphinAttack, can instruct smart devices to visit malicious websites, initiate phone calls, take a picture or send text messages. While DolphinAttack has its limitations — the transmitter must be close to the receiving device — experts warned that more powerful ultrasonic systems were possible,” said The New York Times.

DolphinAttack could inject covert voice commands at 7 state-of-the-art speech recognition systems (e.g., Siri, Alexa) to activate always-on system and achieve various attacks, which include activating Siri to initiate a FaceTime call on iPhone, activating Google Now to switch the phone to the airplane mode, and even manipulating the navigation system in an Audi automobile. (Source: guoming zhang) 

DolphinAttack Demonstration Video 

While the number of smart devices in consumers’ pockets and at their homes is on the rise, it is only a matter of time before the technology falls into the wrong hands, and unleashed against them. Imagine, cybercriminals accessing your Audi or Tesla via ultrasonic attacks against voice recognition technology on a smart device. Maybe these so-called smart devices are not smart after all, as the dangers of these devices are starting to be realized. Millennials will soon be panicking.

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Submitted by Gordon Johnson of The Vertical Research Group

QUICK TAKE: In short, our thesis is that city-level and regional macroprudential tightening policies in China currently will render economic growth in 2Q18, but more importantly 2H18, dismal; we believe this will spread to emerging markets, rendering the “global coordinated growth” bulls out of sync with reality. This, we believe, in turn, will weigh on metals prices, pushing many of the commodity pundits (i.e., Jeffery Gundlach) to reassess their bullishness. As this happens, we expect  steel/bulk exports out of China to rise (as profitability domestically falls with weakening domestic demand) pushing global bulk commodities prices lower.

Exhibit 1: China Total Credit Growth versus Bank Asset Growth, %Y/Y

Source: Peoples’ Bank of China (PBOC), Vertical Group.

Exhibit 2: It Appears Emerging Markets are no Longer “Feeling the China Love”

Source: Bloomberg, Vertical Group.

So how do things look at this juncture? Well, below we highlight the key takeaways from China’s April 2018 data dump. However, in short, looking at the below data in aggregate, we believe our thesis remains firmly intact; furthermore, in checks “on the ground” in China this week, we learned that the Consensus among domestic traders is that steel prices in China have “peaked” for the year as of this week.

GROWTH INTERNALS. As detailed below, while Y/Y industrial production growth edged higher to +6.9% in April 2018 (from +6.8% in March 2018), the all-important Fixed Asset Investment metric in China hit lows not seen in nearly two decades (at +7.0% Y/Y for April 2018 vs. +7.5% Y/Y in March 2018), while retail sales also dipped lower in the month of April at +9.4% Y/Y (vs. +10.1% Y/Y in March 2018). At risk of stating the obvious, at the margin, this suggests to us that China’s key growth internals are indeed slowing.

Exhibit 3: Growth Internals – China (FAI, Industrial Production, & Retail Sales)

Source: National Bureau of Statistics, Vertical Group.

CONSTRUCTION ACTIVITY. Taking a closer look under the hood, we notice real estate floor area sales slowed incrementally in April 2018 up just +1.3% YTD (vs. +3.6% YTD Y/Y in March 2018), and fell a concerning -4.1% Y/Y for the month of April 2018.

Exhibit 4: China Residential + Commercial + Office Space Sold

Source: National Bureau of Statistics, Vertical Group.

However, when looking to new starts, while growth did slow to +7.3% Y/Y in April 2018 from +9.7% Y/Y in March, this rate of progress remains comfortably above the +2.9% Y/Y growth seen in Feb. 2018 (although, with credit growth in China on the decline, we see this metric disappointing throughout the remainder of 2018).

Exhibit 5: China Residential + Commercial + Office Construction Starts

Source: National Bureau of Statistics (NBS), Vertical Group.

Total floor area under construction saw YTD Y/Y growth edge higher to +1.6% from +1.5% in March 2018. However, we feel this metric will move towards 0% by year end (floor area under construction typically follows sales growth; and sales growth is currently consolidating at an accelerated clip – Exhibit 4).

Exhibit 6: China Residential + Commercial + Office Space Under Construction

Source: National Bureau of Statistics (NBS), Vertical Group.

What is the culprit for this slowing? Well, as our readers know, in addition to weakening overall credit growth (Exhibit 1), city-level and regional macroprudential policies have tempered mortgage lending in the world’s second largest economy – this tends to bode ill for overall real estate activity.

Exhibit 7: Household Loans, Y/Y%

Source: PBoC, Bloomberg.

More to the above, first tier cities are in a slow melt while lower tiers are growing at sustainable levels; so from the PBoC’s perspective, there’s really no real reason to shift policy either way yet; and if it comes, adjustment will much more likely be the removal of local lending restrictions than interest rate cuts.

The third key signal is deficit spending, and especially infrastructure. You’ll see lots of announcements from the National Development and Reform Commission (“NDRC”) and spikes in credit drivers… not in bank or shadow-bank lending, but the bond markets. So how are the bond market fairing? Well, China government bond issuance saw growth slow to +23.0% Y/Y in April vs. +24.0% Y/Y in March, and China corporate bond issuance fell from -1.7% Y/Y to -3.9% Y/Y over the same timeframe.

Exhibit 8: Chinese Bond Issuance, Y/Y%

Source: ChinaBond, Bloomberg.

What about Open-Belt-Open-Road (“OBOR”)? Well, here’s a look at infrastructure investment, where it seems China has really slowed things down (manufacturing and real estate are not fairing that well either).

Exhibit 9: China Fixed Asset Investment, Y/Y%

Source: National Bureau of Statistics of China, Vertical Group.

OTHER INDICATORS. On the positive side, it seems construction activity did indeed pickup in April (albeit, Y/Y growth slowed from the records seen last April – April marks the peak of China’s construction season, so this data point could be a bit backward looking).

Exhibit 10: China Construction Vehicle Sales, Y/Y%

Source: Hong Kong Teng Yuan Co. Ltd., Vertical Group.

What about the other data points?

Exhibit 11: Evidence of Seasonality in China’s Manufacturing PMI Survey

Source: China Federation of Logistics and Purchasing, Vertical Group.

Exhibit 12: Industrial Output Volumes, Y/Y% (cement lagging + steel leading = potential for steel price correction)

Source: CEIC, Vertical Group.

Exhibit 13: China Li Keqiang Index

Note: Chinese Premier Li Keqiang once remarked to a U.S. diplomat that China’s GDP data was “man made”. To track growth he preferred to look at change in bank lending, rail freight, and electricity consumption. This ticker takes a weighted average of annual growth rates in outstanding bank loans CNLNTTLY Index DES (40%), electricity production CZINELEC  Index DES (40%), and rail freight volume CHTPFR1Y Index DES (20%). Electricity production is used  rather than electricity consumption as they are conceptually similar and a longer historical series exists for electricity  production. Source: CEIC, Vertical Group.

Exhibit 14: Inflation Gauge – Consumer & Producer Price Indexes

Source: National Bureau of Statistics, Bloomberg, Vertical Group.

Exhibit 15: Average Price Change of New Residential Buildings, by Tiered-Cities, Y/Y%

Source: National Bureau of Statistics (NBS), Vertical Group.

Exhibit 16: JPM Global PMI – just off Mar. ’18 five month low

Source: JPM, Bloomberg Vertical Group.

* * *

CONCLUSION: China will likely continue to slow, yet it seems the PBoC has a good handle on its targeted slowdown, making the need to rush in with “bazooka” stimulus unnecessary right now (in our view, that is). Will it happen? Based on history, of course it will (as it always does). But are we there yet? We think not. Translation… more pain to come before Xi Jinping “rides to the rescue of bulk commodity bulls”, meaning as the summer slow-down sets in, steel/iron-ore prices likely have acute downside risk (this is not Consensus at the moment – see Jeffery Gundlach’s comments from the Sohn conference several weeks ago).

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