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Authored by Charles Ortel via Lifezette.com,

A new Department of Justice probe of the email and charity fraud scandals won’t end well for Bill or Hillary…

Until recently, the Clinton Foundation has been monitored by the IRS, the Department of Justice, and the FBI, and multiple state government authorities that are seeded with persons loyal to either the Clintons or the Obamas.

Every time, the Clinton Foundation got a free pass.

 

But now it appears key authorities may finally be turning strict attention toward answering tough questions about public filings of Clinton “charities” inside and outside the United States. When these powerful organizations engage motivated minds, they will wish to concentrate on a few areas that have long gone begging for attention.

The first time the Clinton Foundation was investigated, between 2001 and 2005, then-FBI Director Robert Mueller, then-Deputy Attorney General James Comey, and others could not seem to find obvious and escalating frauds as a supposed presidential library complex in Little Rock, Arkansas, also “fought HIV/AIDS internationally” from unregistered offices in New York and Massachusetts without ever obtaining required audits of worldwide activities.

Strangely, as the first investigation wound down, evidence in the public domain suggests that the Clinton Foundation also defrauded the National Archivist by making demonstrably false representations in a binding legal agreement.

For example, there is no evidence the IRS provided final approval to the Clinton Foundation to “fight HIV/AIDS internationally” as a tax-exempt purpose by Nov. 18, 2004, the date the presidential archive was officially donated.

That Nov. 18, 2004, agreement is nowhere to be found today on the Clinton Foundation website and in public filings despite the charity’s more than 13 years of widespread solicitation across state and national boundaries using telephones, mail, and the internet.

The next major investigation started in December 2009 when the French government launched a detailed look into UNITAID, a multilateral international organization — primarily funded by France — that has sent more than $650 million to arms of the Clinton Foundation engaged, at least in theory, in fighting HIV and AIDS.

Reports concerning this investigation, written in French and published in 2010 and 2011, show that French government authorities, like their U.S. counterparts, missed the heart of the problem posed by the Clinton Foundation.

The foundation, by its own description, started soliciting funding for its fight against HIV and AIDS early in 2002, though its authorized charitable status didn’t change until March 2004, after the Clinton Foundation HIV/AIDS Initiative Inc. was officially recognized on March 24, 2004, in Arkansas.

Applications made to the IRS, to various states and to foreign governments for tax exemption and solicitation rights to pursue this radically different mission, are not available on the central portal operated by the Clinton Foundation, nor forthcoming, yet, from the governments concerned.

Federal tax filings for this entity for the partial year in 2004 and for 2005 aren’t available on the Clinton Foundation website, perhaps because they show substantial activities that seem to fall far outside tax-exempt purposes approved by the IRS.

In addition, these and other tax filings fail to explain payments to members of the Clinton family for services received and for reimbursement of expenses by donors to the Clinton Foundation.

Even though there is no public record that the Clinton Foundation ever was authorized to control a supposed charity “fighting HIV/AIDS internationally,” the Clinton Foundation HIV/AIDS Initiative Inc. was supposedly liquidated as of Dec. 31, 2005, with all of its worldwide activities and obligations supposedly taken over by the parent foundation. There is no evidence in the public domain that the merger was lawfully completed in each U.S. state and foreign country in which either entity operated.

From 2006 through 2009, the Clinton Foundation solicited funds and received a majority of its growing revenues, in theory, to fight HIV and AIDS internationally. Required audits were not prepared to strict U.S. requirements.

Moreover, versions of these audits on the Clinton Foundation website exclude key “combining” statements that show for 2007 through 2009 just how substantial HIV- and AIDS-specific financial amounts are compared to the combined total. The Clinton Foundation attempted to reorganize in 2009, but available public filings could place multiple individuals in significant jeopardy.

For example, claims made to the IRS in applications for federal tax exemption on Form 1023, under penalties of perjury, are false and materially misleading concerning numerous entities created after Sept. 4, 2009, to carry on unauthorized activities in which the Clinton Foundation had been engaged starting in 2002.

To get to the heart of the vexing problems that allowed the largest unprosecuted charity frauds ever attempted to flourish from January 2001 forward, one must ask many questions of central figures in federal, state and foreign governments.

How did Deputy Attorney General Rod Rosenstein, while U.S. attorney in Maryland, miss the fact that the Clinton Foundation was promoting use of potentially adulterated HIV and AIDS drugs from October 2003 forward, even as he took until May 2013 to help win a $500 million set of penalties against the Indian manufacturer of the generic drugs?

Why was an African-American selected for prosecution during her re-election campaign in 2016 when Hillary Clinton was left unscathed despite the many years of questionable charitable activities by the Clinton Foundation?

How did Rosenstein miss obvious errors in the Clinton Foundation tax filings for 2010 (originally submitted in 2011 with amended versions submitted in 2015) concerning a $37.1 million donation to the Clinton Bush Haiti Fund at a P.O. Box address in Baltimore, Maryland, that was never declared, as required, in key states like New York?

Why did Rosenstein (and many other officials, including New York Attorney General Eric Schneiderman), fail to require Laureate Education and the Clinton Foundation to explain how they organized the “Clinton Global Initiative University” and why the Clinton Foundation tax filings for 2010 through 2016 don’t explain what Bill Clinton did for the $17.6 million he was paid as part-time chancellor while he held key roles at the Clinton Foundation?

Former Congresswoman Corrine Brown, a Florida Democrat, reports to jail for a five-year term in federal prison following her conviction of being part of an $800,000 charity fraud. Why was this African-American selected for prosecution during her re-election campaign in 2016 when Hillary Clinton was left unscathed despite the many years of questionable charitable activities by the Clinton Foundation?

Former presidents in either the Democratic or Republican parties are not above the law. Now it’s up to President Donald Trump to make this fact abundantly clear.

via RSS http://ift.tt/2m6qTEq Tyler Durden

“Record cold temperatures continue to blanket the northeastern U.S. this weekend along with gusty winds. This combination is leading to wind chills well below zero across much of the region, making it difficult to even go outside. This cold will not only be dangerous for people’s health, but will also increase the risk for pipes to freeze along with other infrastructural problems. People need to dress in layers to guard against frost bite if outside for any amount of extended time. This brutal stretch of winter weather will last into Sunday before abating into next week,” said Ed Vallee, a meteorologist at Vallee Weather Consulting LLC.

A blast of Arctic air from Canada, Greenland, and Siberia has descended onto the Northeast through the weekend plunging temperatures and wind chills to dangerously cold levels in the wake of the “bomb cyclone” that exploded over the East Coast last week.

The National Weather Service (NWS) has issued wind chill advisories and warnings for much of the Northeast through the weekend.

Wind chill advisories and warnings are in effect until Sunday morning rendering most of the Northeast hazardous to human health. In some parts, wind chill values may decline to 45 degrees below zero, which can cause frostbite to exposed skin in under 10 minutes.

Ed Vallee warns the “cold is not just in the Northeast. Record lows expected from Bangor, Maine to Charleston, SC tonight!”

He further expects, “more record lows tonight from Portland all the way down the I-95 corridor to DC. Impressive as we approach the coldest point in the winter season!”

Early next week, another system has a high probability of blanketing the Northeast with a mix of snow, sleet, ice, and rain. As of Saturday, the system is tracking eastward into the Rockies and moving into the Central U.S. on Sunday.

 

 

The Weather Channel forecasts the next round of wintry precipitation to hit the Northeast on Sunday night and continue into early next week,

Sunday Night

• This system will slide eastward on Sunday night, spreading a wintry mix farther east.
• Snow is likely from the Great Lakes into parts of the Ohio Valley, interior Northeast and northern New England.
• A mix of snow, sleet and freezing rain is possible from central Illinois and central Ohio southward into parts of Tennessee and possibly northern Georgia.
• Rain is likely from eastern Oklahoma into Alabama, with a few thunderstorms in eastern Texas and Louisiana.

Monday

• The chance of snow will stretch from Indiana into the interior Northeast and northern New England.
• There will be areas of sleet and freezing rain in parts of the mid-Atlantic, Ohio Valley and the central and southern Appalachians.
• Otherwise, rain is currently expected through much of the South, with a few thunderstorms possible toward the Gulf Coast.

Glancing at Natgas

“This string of cold has stressed the market just as much as the polar vortex of 2014,” Borruso told Bloomberg “You are seeing pipeline restrictions and flow restrictions pop up.”

Ed Vallee, a meteorologist at Vallee Weather Consulting LLC, is forecasting a warmer second half of January, which could fade NatGas demand and lead to a reversal in price from the recent price surge.

The recent cold weather sparked increased natural gas consumption particularly in the Northeast this past week. However, we are eyeing a warming trend later next week, with a potentially more substantial warmer risk between the 15th and the 20th of the month. We are beginning to see the market take this bearish weather outlook into consideration given how we closed out last week’s trading. How long this warmer regime lasts remains a bit uncertain, but some data points to some colder risks returning toward the end of the month.

Bespoke Weather’s most recent energy report also confirmed Vallee’s bearish thesis on NatGas through the end of the month. Full report below:

And lastly, @crankywxguy‘s weather outlook for the rest of January through early February. Could the cold snap return in early February?

Meanwhile, as we wait for the next blast of frigid cold air, America’s next flu epidemic has arrived.

GEEZ! I only see 3 of the lower 48 states without “widespread” flu reported by the CDC. You know the drill… WASH YOUR HANDS…. #ARWX http://pic.twitter.com/hzR87pcTEL

— Todd Yakoubian (@KATVToddYak) January 6, 2018

via RSS http://ift.tt/2CKjFiN Tyler Durden

While the establishment would like the world to believe that only criminal masterminds and people with something to hide would prefer the decentralized freedom of Bitcoin (as opposed to the ‘under government watch’ banking system that floats Washington’s boat), the truth is that the biggest cryptocurrency is considerably less ‘anonymous’ than is commonly exclaimed.

In fact, as more and more criminals become aware of the real privacy concerns of Bitcoin, they are increasingly turning to other – more private – coins.

 

As Bloomberg reports, privacy coins such as monero, designed to avoid tracking, have climbed faster over the past two months as law enforcers adopt software tools to monitor people using bitcoin. A slew of analytic firms such as Chainalysis are getting better at flagging digital hoards linked to crime or money laundering, alerting exchanges and preventing conversion into traditional cash.

 

The European Union’s law-enforcement agency, Europol, raised alarms three months ago, writing in a report that “other cryptocurrencies such as monero, ethereum and Zcash are gaining popularity within the digital underground.” Online extortionists, who use ransomware to lock victims’ computers until they fork over a payment, have begun demanding those currencies instead. On Dec. 18 hackers attacked up to 190,000 WordPress sites per hour to get them to produce monero, according to security company Wordfence.

For ransomware attacks, monero is now “one of the favorites, if not the favorite,” Matt Suiche, founder of Dubai-based security firm Comae Technologies, said in a phone interview.

Monero quadrupled in value to $349 in the final two months of 2017, according to coinmarketcap.com, placing it among a number of upstart coins that rose faster than bitcoin, the world’s most valuable digital currency. Bitcoin roughly doubled in the same period, data compiled by Bloomberg show. Monero’s price has climbed another 7 percent so far this year, according to coinmarketcap.com.

 

 

In monero’s case, Bloomberg explains, criminals are snapping it up because bitcoin’s underlying technology can work against them. Called blockchain, the digital ledger meticulously records which addresses send and receive transactions, including the exact time and amount — great data to use as evidence. Match an address to a crime and then watch the bitcoin universe carefully, and you can see the funds disappear and reappear in other locations.

Sleuths have developed databases and techniques for digesting that information to eventually nab wrongdoers. Say, for example, a coffee shop in Berkeley is known to have a certain bitcoin address, and a wallet used by an extortionist transfers the same amount there every morning at 9 a.m. Police can stop by and make an arrest.

Started in 2014, monero is very different. It encrypts the recipient’s address on its blockchain and generates fake addresses to obscure the real sender. It also obscures the amount of the transaction.

The techniques are so potent that software that flags coins suspected of being obtained through crime now tags just about anything converted into or out of monero as high risk, according to Pawel Kuskowski, chief executive officer of Coinfirm, which helps exchanges and other companies avoid tainted money. That compares with only about 10 percent of bitcoin, he said.

“What we treat ‘high risk’ is something that’s anonymizing funds,” he said in a phone interview. “How are you going to prove that these funds are not coming from illegal sources?”

Developers behind monero say they simply created a coin that protects privacy. Most people use it legitimately — they just don’t want others to know whether they’re buying a coffee or a car, Riccardo Spagni, core developer at monero, said in a phone interview.

“As a community, we certainly don’t advocate for monero’s use by criminals,” Spagni said.

“At the same time if you have a decentralized currency, it’s not like you can prevent someone from using it. I imagine that monero provides massive advantages for criminals over bitcoin, so they would use monero.”

via RSS http://ift.tt/2CLHKFT Tyler Durden

Authored by Wolf Richter via WolfStreet.com,

First decline in its colossal balance sheet since 2012.

An amazing – or on second thought, given how central banks operate, not so amazing – thing is happening.

On one hand…

Bank of Japan Governor Haruhiko Kuroda keeps saying that the BOJ would “patiently” maintain its ultra-easy monetary policy, so too in his first speech of 2018 in Tokyo, on January 3, when he said the BOJ must continue “patiently” with this monetary policy, though the economy is expanding steadily. The deflationary mindset is not disappearing easily, he said.

On December 20, following the decision by the BOJ to keep its short-term interest-rate target at negative -0.1% and the 10-year bond yield target just above 0%, he’d brushed off criticism that this prolonged easing could destabilize Japan’s banking system. “Our most important goal is to achieve our 2% inflation target at the earliest date possible,” he said.

On the other hand…

In reality, after years of blistering asset purchases, the Bank of Japan disclosed today that total assets on its balance sheet actually inched down by ¥444 billion ($3.9 billion) from the end of November to ¥521.416 trillion on December 31. While small, it was the first month-end to month-end decline since the Abenomics-designed “QQE” kicked off in late 2012.

Under “QQE” – so huge that the BOJ called it Qualitative and Quantitative Easing to distinguish it from mere “QE” as practiced by the Fed at the time – the BOJ has been buying Japanese Government Bonds (JGBs), corporate bonds, Japanese REITs, and equity ETFs, leading to astounding month-end to month-end surges in the balance sheet. But now the “QQE Unwind” has commenced. Note the trend over the past 12 months and the first dip (red):

JGBs, the largest asset class on the BOJ’s balance sheet, fell by ¥2.9 trillion ($25 billion) from November 30 to ¥440.67 trillion on December 31. In other words, the BOJ has started to unload JGBs – probably by letting them mature without replacement, rather than selling them outright.

Some other asset classes on its balance sheet increased, including equity ETFs, Japanese REITs, “Loans,” and “Others”

On net, and from a distance, the first decrease of the BOJ’s assets in the era of Abenomics was barely noticeable. Total assets are still a massive pile, amounting to about 96% of Japan’s GDP (the Fed’s balance sheet amounts to about 23% of US GDP):

The chart below, going back to only 2016, shows how the monthly increases of the BOJ’s assets leveled off, still rising but at a slower rate – or “tapering” – since December 2016 and how in December 2017, those increases turned into the first decline since late 2012:

None of this – neither the 12 months of “tapering” nor now the “QQE Unwind” – was announced. They happened despite rhetoric to the contrary.

During peak QQE, the 12-month period ending December 31, 2016, the BOJ added ¥93.4 trillion (about $830 billion) to its balance sheet. Over the 12-month period ending December 31, 2017, it added “only” ¥44.9 trillion to its balance sheet. That’s down 52% from the peak.

This chart shows the rolling 12-month change in the balance sheet in trillion yen, going back to the Financial Crisis:

The BOJ has used QQE as an internationally accepted pretext to bring Japan’s public debt under control by effectively removing much of it from the market in order to prevent a Greek-like debt crisis. And it worked.

Japan’s national debt reached 250% of GDP at the end of 2016, by far the highest in the world. Between the JGB holdings by the BOJ and by state-owned institutions, such as the Government Pension and Investment Fund, Japanese authorities now control the majority of Japan’s national debt, and there won’t be a debt crisis – though it could trigger other crises. And it appears that the BOJ decided that this might be enough control. Hence the end of QQE.

The Fed leads — The Fed’s QE Unwind is really happening — and other central banks follow.

The ECB began tapering in April 2017, slashing its monthly asset purchases from €80 billion to €60 billion. As of January 2018, the ECB has tapered further, cutting its monthly purchases to €30 billion. But unlike the BOJ, the ECB communicated this tapering via rumors, speeches, and finally press conferences that were spread all over the media.

So the high-octane QE juice that has powered global financial markets for years is beginning to evaporate, with the ECB being the last but fading holdout among the biggest central banks.

Central banks are leery of the newly arrived Chinese yuan. Read…  US Dollar Refuses to Die as Top Global Reserve Currency

via RSS http://ift.tt/2m4r6Hc Tyler Durden

The new year has only just begun, but already Democratic politicians in the country’s largest high-tax states are threatening lawsuits and publicly touting proposed workarounds to help compensate tax payers for the elimination of the state and local tax (SALT) deductions which were dramatically rolled back, along with deductions for mortgage interest, as part of the White House’s tax reform plan.

During his state of the state address earlier this week, New York Mayor Andrew Cuomo threatened to sue the federal government over the tax bill, claiming that the plan is unconstitutional and overly burdensome to New Yorkers.

Cuomo said that the new law could raise some families’ taxes by as much as 25% and said the plan amounted to “double taxation.” He later accused President Donald Trump of waging “economic civil war” on states that didn’t back him during the election, and promised to consider workarounds that would help lower residents’ federal tax bills, according to Bloomberg.

Then, on Thursday, California Senate President Pro Tempore Kevin de Leon introduced a bill that the Washington Post said could become a model for how blue states push back against the Trump tax plan.

According to the Trump tax plan, which took effect in January, taxpayers can only deduct up to $10,000 in state and local taxes when they file their federal return.

De Leon’s bill, if it became law, would essentially allow Americans to deduct much more than the $10,000 limit by redirecting state tax payments into a type of charitable contribution that would be later redirected to the state. The new federal tax law, which was supported only by Republicans, went into effect in January and does not include any caps on charitable deductions.

“The Republican tax plan gives corporations and hedge-fund managers a trillion-dollar tax cut and expects California taxpayers to foot the bill,” de León said in a statement. “We won’t allow California residents to be the casualty of this disastrous tax scheme.”

Several states have said they are looking for ways to challenge or work around the law, particularly states such as California and New York where residents pay a higher level of local taxes that they have traditionally been able to deduct without any limits. New York Gov. Andrew M. Cuomo (D) has said he is looking at a way of challenging the new law in court.

Then on Friday, incoming New Jersey Gov. Democrat Phil Murphy said he’s working on a plan similar to California’s that would allow taxpayers to pay a percentage of their state income taxes as if they were a charitable donation. The money will eventually be redirected to the state. And there’s nothing in the Republican tax plan that limits charitable deductions.

Predictably, the White House has threatened to push back against these strategies. During a televised interview this week, Gary Cohn said the administration would be looking into ways to stop states from implementing these work-arounds.

Phil Murphy

Even the Republicans’ rosy projections show the cuts will add nearly $1.5 trillion to the national debt in the coming decade. That number could grow if Democratic states succeed in their workarounds.

Here’s Bloomberg:

Phil Murphy, a Democrat who will be sworn in as New Jersey’s governor on Jan. 16, said Friday he’s working on a plan that would effectively convert property taxes into charitable gifts. Murphy joins New York Governor Andrew Cuomo and California Senate President Pro Tem Kevin de León, who have also said they’re considering ways to shield their constituents from a new $10,000 federal cap on state and local tax deductions.

Murphy’s announcement came just hours after White House economic adviser Gary Cohn said the Trump administration may try to block any potential avoidance strategies by high-tax states.

“I understand what they’re trying to do for their cities and their states and their taxpayers,” said Cohn, director of the National Economic Council, during a Bloomberg Television interview Friday. “We at the federal government still have to collect revenue.”

The state actions and Cohn’s response suggest a looming showdown or the beginning of a cat-and-mouse game between state and federal policy makers, experts said.

Before the Republican Congress’s tax overhaul took effect Jan. 1, most filers could deduct state and local taxes from their federal returns, a benefit that applied to property, income, and other levies. But the new law that President Donald Trump signed last month caps the so-called SALT deduction at $10,000, a change that could cost residents of high-tax states billions of dollars.

Even before the tax bill passed, states have been squabbling with the IRS over what their tax payers can do to pay as much of their upcoming tax burden under the previous tax regime.

A precursor to tension between the federal government and states first emerged at the end of December over the prepayment of state and local property taxes. Some officials in states including New York and New Jersey encouraged homeowners to prepay their 2018 property taxes before the end of 2017 so that they could claim those deductions under the previous tax code – without the $10,000 cap.

But the IRS issued guidance that would effectively limit or kill the prepayment benefit for millions, saying the taxes in question would have to have been assessed by local tax authorities in 2017 to qualify for deductibility on 2017 returns. Many jurisdictions hadn’t yet done such assessments for 2018 property taxes – putting prepayments in question and stirring anger and confusion across the country.

The new limit hits California and New York hardest, due to their high state taxes and large populations. Connecticut, New Jersey, and the District of Columbia round out the top five jurisdictions where individuals claimed the largest average SALT deductions. In each of these states, the average itemizer paid nearly double the cap that the new Trump tax plan imposes.

But whether Murphy’s plan – and the plans being implemented by blue states on both coasts – succeeds is a matter of debate, even though a 2011 IRS memo seems to approve taxpayers claiming writeoffs for these types of gifts.

Murphy said there’s precedent for the charity approach, but the IRS memo shouldn’t be considered as such, Andy Grewal, a professor at the University of Iowa College of Law, told Bloomberg.

“If somehow this did succeed, Congress could just pass a one sentence statute,” said Grewal. “It’s too good to be true.”

New York Governor Cuomo also said he’s developing a plan to shift the state from a personal income tax to a system of payroll taxes levied on employers, who’d still be allowed to deduct such levies on their federal taxes by law. Tax officials in Connecticut are considering a similar plan.

Replacing state income taxes with payroll taxes would be complicating, requiring employers to adjust wages and potentially create a system of tax credits. It would also offer a more widespread economic benefit than would the charitable-giving strategy, since a shift to payroll taxes would also apply to taxpayers who don’t itemize, according to David Kamin, a New York University School of Law professor.

Proposals from New York and California are “interesting, but unlikely to succeed for both legal and practical reasons,” Jared Walczak, a senior policy analyst at the conservative-leaning Tax Foundation, said in a report Friday.

“If states are genuinely concerned about the effects of their tax codes absent an uncapped state and local tax deduction, they should consider revisiting their tax rates rather than devising increasingly convoluted and legally suspect workarounds,” Walczak wrote.

However, with many blue states like Connecticut already grappling with dangerously underfunded public employee pension obligations, the pressure on these states to stop wealthy taxpayers from leaving – as we noted yesterday – has never been greater.

via RSS http://ift.tt/2CxhHz3 Tyler Durden

Some were stunned, others shocked, yet others found absolutely nothing surprising about Trump’s Saturday morning tweetstorm, in which the president defended his mental state, claiming “my two greatest assets have been mental stability and being, like, really smart… I think that would qualify as not smart, but genius….and a very stable genius at that!”

The media certainly had follow-up questions, and a few hours later, at Camp David Trump was asked “why did he feel the need to tweet” about his mental state, to which the president had a lengthy response: “well, because I went to the best colleges, or college,” Trump spoke flanked by GOP congressional leaders.

“I had a situation where I was a very excellent student, came out, made billions and billions of dollars, became one of the top business people, went to television and for 10 years was a tremendous success, which you’ve probably heard.”

Trump reiterated that Michael Wolff, the author of the bombshell new book “Fire and Fury: Inside the Trump White House,” which has raised fresh questions about Trump’s competency, did not have access to the White House for his reporting.

“[Then I] ran for president one time and won, and then I hear this guy that does not know me, does not know me at all. By the way, did not interview me for three hours, it didn’t exist, OK? It’s in his imagination,” Trump said.

As we reported earlier, on Saturday morning Trump wrote that throughout his life, his “two greatest assets have been mental stability and being, like, really smart… I think that would qualify as not smart, but genius….and a very stable genius at that!” he added.

Trump has made similar comments about his mental ability before, in an interview with CNN in 2015.

“I had an uncle went to MIT who is a top professor. Dr. John Trump. A genius,” Trump said at the time. “It’s in my blood. I’m smart. Great marks. Like really smart.”

Trump, asked why he tweeted about his mental stability this AM, responds: “Only because I went to the best colleges… I had a siutation where I was a very excellent student… Ran for president one time and won. And then I hear this guy that does not know me…” (via CBS) http://pic.twitter.com/zmZwyNrNNV

— Kyle Griffin (@kylegriffin1) January 6, 2018

Addressing the media, Trump also answered questions on topics ranging from the Russia investigation, North Korea and the party’s legislative agenda.

The president again insisted he was not under investigation by special counsel Robert Mueller and reiterated his belief his campaign did not collude with Russia’s election-meddling efforts in 2016.

“Everything I’ve done is 100 percent proper,” Trump said when asked about reports he urged Attorney General Jeff Sessions not to recuse himself from the Russia probe. “That is what I do, is I do things proper.” Trump said a New York Times report that he asked White House counsel Don McGahn to talk Sessions out of recusal was “off,” but did not explain further.
 
The president also expressed hope that good can come out of upcoming talks between South Korea and North Korea, an apparent shift from his stated skepticism that diplomacy can solve the nuclear crisis on the Korean Peninsula. Trump also said he is open to talking with North Korean leader Kim Jong Un, whom he taunted this week over the size of his “nuclear button.”

“Sure, I always believe in talking,” Trump said. But the president said he would not engage in talks without preconditions.

* * *

According to The Hill, Trump also started to sketch out his legislative agenda for 2018. He suggested he might back off his push to get started quickly on welfare reform, unless Democrats get on board.

“We’ll try and do something in a bipartisan way, otherwise we’ll be holding it for a little bit later,” Trump said.

The president said he had “great meetings” with his counterparts in Congress that touched on the budget, security, infrastructure, military and the Deferred Action for Childhood Arrivals (DACA) program. But Trump said he would not agree to relief for young immigrants covered by the DACA program unless Democrats accept his demand for a border wall with Mexico.

“We want the wall,” he said. “The wall is going to happen, or we’re not going to have DACA.”

It wasn’t all business for the officials at Camp David. Trump and the lawmakers on Friday night watched the film “The Greatest Showman,” about the life of the famous showman and circus promoter, P.T. Barnum.

via RSS http://ift.tt/2m8Sm8j Tyler Durden

Authored by The Element Group via Hackernoon,

Cryptocurrency market observers will remember 2017 as the year of the ICO boom, bitcoin’s hard fork(s), cryptokitties, a few major hacks, and the time when every single dinner party swayed towards talking about the price of bitcoin at some point or another. Instead of looking at what just passed, today we’re looking at the year that awaits us.

 

As we reflect on the past year, we see a number possible trends that will affect the market in 2018.

Here are our predictions for the year to come:

1. A major exchange will be hacked

The exchange space is evolving rapidly — with many new entrants post-China shut down repainting the space. The emergence and quick dominance of Binance, the reboot of many former mainland platforms, as well as proliferation of exchanges in Japan and in Korea Appearance of many smaller/regional players with other raw tech will lead to more exchanges being compromised, and more used funds at risk. Some are building from scratch. Some are buying off the shelf. Strong security/tech/blockchain talent is impossible to find. Many will come under attack, and there a good chance one major exchange will fall due to lax operational standards and risk management infrastructure.

2. Coinbase’s extreme influence will continue

In the US, there are really only three retail on-ramps into crypto. Coinbase, Gemini, and Kraken. Because the space has grown so quickly and the State-By-State MTL moat is so wide, it will take significant time for other players to emerge and get plugged into the US banking infrastructure. This has been exacerbated by the effective departure of Bitfinex from the US market. There’s hope that Bittrex will get to fiat, but no other good solutions are in sight. What we see forming in the US is an organic natural monopoly, where a decentralized garden is supposed to flourish. Even the dream of decentralized exchanges presupposes that these “moneycenter” exchanged exist.

It’s going to be an interesting year for exchanges.

3. Futures on other cryptocurrencies, more options structures, and ETFs will emerge

Futures were easy…. Because they are cash settled instrument that are fundamentally divorced form the underlying BTC liquidity. With the scramble to get bitcoin futures up and running that we saw towards the end of 2017, it is a given that more and more such products will emerge. We previously commented on why bitcoin futures are essential. First and foremost, they represent a movement to cater towards more traditional investors, and we are confident that we will see many more products catering towards a more sophisticated trading audience in 2018.

ETFs are hard because they have to won the coin. They take a leap of imagination from regulators. They take an orderly market with manageable volatility. The high absolute BTC price might do the trick. Here’s to them taking a leap in 2018.

4. There will be a major correction in the ALTS

Easy come easy go. Lots of people sitting on massive paper gains for shallow and illiquid coins. Many of those coins trade on small exchanges, with limited capacities. When a big dip comes and sellers don’t see buyers, are unable to sell in size, and look for any exit opportunities, we will see a massive rerating of the alts space. While there’s talk of relative value in Tier 1 coins, few will step in when the sector truly goes red. It take a certain type of chutzpah to buy something that’s down 85%. Nerves of steel. Stay calm and carry on.

5. Crowd sales and orderly markets will be the regulatory focus

While the Munchee decision drew several bright lines, it left many questions unanswered. The Chairman’s statement, a new method of regulation, is being digested by the leading law firms and the path forward remains unclear. The enforcement posture is changing. The Crypto Bar is expecting more clarity and more engagement in Q1. While it has been quiet on the cryptocurrency trading side, one or more regulator will put a stake in the ground. Market manipulation, in all its forms — pump and dump attempts, insider trading, front running and other ways of impeding an orderly market. Crypto is the first truly global market — it will be interesting what regulator coalitions emerge to address it.

6. Institutional service providers will build for the space

The lack of traditional service providers (order management systems, reconciliation software, custodians, etc.) has kept many institutions and fiduciaries out of cryptocurrencies. The emergence of sound technical solutions in this category will mean a considerable operational risk gap will be filled, leveling the playing field for many fund managers. Many of the service providers that have emerged in 2017 will have built up a sufficient track record to prove attractive for institutional players.

7. Fund managers will experience a dispersion of returns.

In the past year, it was not uncommon for a fund manager that bought and held to promote their extraordinary returns as alpha. It is, of course, apparent that these returns had more to do with market dynamics rather than individual skills. This trend will change in the next year as markets continue to mature and gain efficiency. The skill and edge of a fund manager will become more evident as good managers will show higher returns than lucky managers.

8. We will see bouts of hyper-volatility because of futures expirations, options expirations, and ETF rebalancing.

As these new financial products become more popular, their effect on market trends will be more pronounced. Even traditional equity markets experience high levels of volatility a few times a year because of these scheduled events. This type of volatility will be an order of magnitude larger in the cryptocurrency world when futures and other derivatives expire or need to be rebalanced.

9. We will see at least one traditional financial brokerage firm lose money and go out of business because of mismanagement with a derivatives product.

Despite there being a listed derivative with futures (and possibly ETFs), the truth of the matter is that trading and hedging with the underlying asset is still an operationally tricky test. One bad trade or one bad line of code within a company that isn’t a cryptocurrency trading expert can and will do irrevocable harm to the bottom line.

10. Sentiment, Momentum and Insider posture — psychology owns this market.

There’s been quite of a bit of mob mentality driving the marketplace as the retail trader can feel empowered making public market calls on social media. That platform to voice an opinion coupled with some good luck has made the average investor feel invincible, so much that they do not listen to what insiders are saying or doing. As evidenced by the correction that happened in December, paying attention to insiders matters. More than likely they know more than the average person, no matter the numbers the latter may have.

11. A bank run?

At some point, lots of people will try to take real fiat dollars off exchanges.. and see the massive weak link. Getting dollars out of an exchange entirely depends on their banking providers continuing to play along. Most exchanges have a 100K / month withdrawal limit for their high verification tiers… hard to “go to cash” and “fly to safety” — and Tether won’t help. What if there’s a pause… the way Bitfinex paused this year, but recovered. What if all those gains in crypto, on exchange, in cold wallets, all of it… starts having a hard time getting to USD?

It’s a young, global, stormy, 24/7 capital market. 2018 will be its year.

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America’s declining influence in the Middle East and the Pacific Rim has been in hyperdrive this week following President Trump’s tweetstorm against Pakistan.

On New Year’s day, Trump unleashed a series of tweets accusing  Pakistan of harboring terrorists, and went so far as to threaten cutting off the country’s financial aid. To make matters worse, U.S. Ambassador to the United Nations Nikki Haley, also accused Pakistan of playing “a double game for years,” and said President Trump would withhold $225 million in aid to the country.

Trump’s tweetstorm did not impress the Pakistani government: in response, it announced that it would be evicting some 1.4 million Afghan refugees from the country later this month. The Pakistani government also announced closer ties with China, and would ditch the dollar in bilateral trade with China, a move that has threatened Washington’s diplomatic relations with Pakistan.

And now, according to the Washington Times, Pakistan will further boost economic and defense ties between Beijing and Islamabad. The report specifies that China is planning to build a military base in Pakistan, which would be its second military base in the East. The naval installation will be erected in a key strategic location: the Pakistani town of Jiwani, a port near the Iranian border on the Gulf of Oman and near the Straits of Hormuz, which resides at one of the six proposed economic corridors of the One Belt One Road Initiative, commonly called the Silk Road Economic Belt.

China’s economic strategy in the Jiwani region of Pakistan is as follows:

Plans call for the Jiwani base to be a joint naval and air facility for Chinese forces, located a short distance up the coast from the Chinese-built commercial port facility at Gwadar, Pakistan. Both Gwadar and Jiwani are part of Pakistan’s western Baluchistan province.

 

The large naval and air base will require the Pakistani government to relocate scores of residents living in the area. Plans call for their relocation to other areas of Jiwani or further inland in Baluchistan province.

The Chinese also asked the Pakistanis to undertake a major upgrade of Jiwani airport so the facility will be able to handle large Chinese military aircraft. Work on the airport improvements is expected to begin in July.

The naval base and airfield will occupy nearly the entire strategic peninsula.

Jiwani will be China’s second overseas military base, in addition to the first foreign military base opened last year in Djibouti, a small but tactically critical African nation near the Horn of Africa, where China deployed troops  for the first time last July. In doing so, China has direct oversight and visibility of the Bab el-Mandeb Strait in the Red Sea, which together with the Suez Canal and Strait of Hormuz, is one of the planet’s most important oil chokepoints.

Washington has called China’s foreign military base expansion the “string of pearls” strategy. Meanwhile, as the world grows fed up with Washington’s overseas policies, the Chinese are using this opportunity to roll out military bases in the Persian Gulf through the Indian Ocean, and in South East Asia.

Harrison Akins, a researcher at the Howard Baker Center who focuses on Pakistan and China, told Newsweek, “Chinese investment in Pakistan is expected to reach over $46 billion by 2030 with the creation of a [China-Pakistan Economic Corridor] connecting Balochistan’s Gwadar Port on the Arabian Sea with Kashgar, in Western China.”

“Trump will soon find that his ability to unilaterally exert pressure to promote U.S. policy and security abroad is severely limited, as Pakistan has increasingly relied upon China for economic and military assistance,” Akins added.

So as Pakistan pivots away from the US, both financially, diplomatically and militarily, China is happy to step in and fill all the voids.

Total direct investment in Pakistan, 2017:

China: $837 million
US: $42 million

— ian bremmer (@ianbremmer) January 5, 2018

 

And so, America’s fading influence has claimed its latest victim, Pakistan. In one week, President Trump and Niki Haley have managed to collapse the bilateral relations between Pakistan and the United States, which has spurred China to pick up the broken piece and start nation-building in Pakistan. And as China tastes diplomatic success, the same blueprint will soon be applied to all other “US-allied” nations in the region.

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Secretary of Defense Jim Mattis has had a long and storied career in the armed services.

As The Daily Caller’s Benny Johnson details, the four-Star Marine general is beloved by those who serve under him for his no-nonsense, blunt leadership style.

Mattis is also known for his colorful quotes on and off the battlefield, which is why no one was surprised when he gave the world another classic quote today at the Pentagon.

While speaking with a gaggle of reporters this afternoon, Mattis was asked what his biggest military concern of 2018 was.

His response:

“I don’t have concerns. I create them”

The quote follows in a long tradition of magnificent Mattis quotes, including his answer to what keeps him awake at night:

“Nothing. I Keep Other People Awake At Night.”

And these classics:

“It’s quite fun to shoot them, you know. It’s a hell of a hoot. It’s fun to shoot some people.”

“There are some assholes in the world that just need to be shot.”

“Be polite, be professional, but have a plan to kill everybody you meet.”

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After yesterday’s meeting with the Senate Working Group on Immigration, Trump told reporters that before agreeing to any legislation enshrining DACA protections into law, Republicans would need to secure more resources for immigration officers, provisions to stop visa overstays and – crucially – legislation limiting chain migration, a topic that Trump has tweeted about regularly since the Halloween terror attack on Manhattan’s West Side Highway.

And as the administration braces for the upcoming battle over US immigration policy, they’re asking Congress for $18 billion to build 700 miles of new and replacement barrier along the southern border over the coming decade.

Construction on the prototypes for Trump’s wall has been completed, and the Department of Homeland Security is ready for next steps: If approved, that would be a major expansion from the 654 miles of barrier now, bringing the total to nearly 1,000 miles, about half of the entire southwest border.

 

According to the Wall Street Journal, the plans are laid out in a document prepared by the Department of Homeland Security for a group of senators who asked the administration to detail its request for border security. The document was described to The Wall Street Journal by two people who had seen it. Presumably, WSJ’s sources attended Thursday’s working group meeting.

In total, the administration details about $33 billion in desired new border-security spending, including funding for technology, personnel and roads. The document refers to this as “critical physical border security requirements.”

President Trump’s proposed border wall was in many ways the essence of the 2016 Trump campaign. In many ways, it factored into his rhetoric from the beginning, almost immediately after Trump descended the golden escalator in Trump Tower to declare his intention to run way back in June 2015.

Trump routinely described his pet infrastructure project as a “big, beautiful wall” that would rise over the southern border, preventing illegal immigration and drug trafficking. Furthermore, Trump promised that the project – some estimates placed the cost at close to $70 billion – would be paid for by Mexico. Yet so far, Congress hasn’t agreed to spend any money on the project, and Mexico has repeatedly said it won’t fund it.

But the document cited by WSJ is perhaps the first comprehensive vision of what the wall will look like, if completed.

The document, from the Customs and Border Protection agency at the Department of Homeland Security, envisions the border-wall project unfolding over 10 years. If carried out as described, by 2027, about 970 miles of the 2,000-mile southwest border would have some sort of fencing or wall separating the U.S. from Mexico.

It comes as lawmakers and the White House negotiate an immigration package that would legalize young undocumented immigrants brought to the U.S. as children, a group known as Dreamers. The White House has demanded that border security be included in the legislation, and last month a group of GOP senators asked for details of what the White House is seeking.

Of course, the document isn’t a complete representation of the administration’s immigration demands – which also include changes in laws and policy. The paper also cautioned that support for the border wall is tepid, even among Republicans.

The document isn’t meant to be a complete outline of the administration’s requests, which also involve changes to the legal immigration system and other enforcement measures, an administration official said. Rather, it details only the border-security elements.

Congressional support for the border-wall idea is tepid, with Democrats and even many Republicans opposed on either financial or symbolic grounds. But lawmakers in both parties support other types of increased border security.

In addition to the wall-related funding requests, the White House and its partners in Congress are also seeking $5.7 billion over five years to pay for towers, surveillance equipment, unmanned aerial vehicles and other technology; $1 billion over five years for road construction and maintenance; and $8.5 billion over seven years for 5,000 new Border Patrol agents and other personnel. The administration has already requested $1.6 billion for 60 miles of a new barrier in Texas and 14 miles of replacement fencing in San Diego for the current fiscal year. Congress hasn’t passed the spending bills for 2018, and wall funding is one of the hang-ups.

The administration’s new document doesn’t detail where the additional miles of barrier would be constructed beyond 2018. It refers to the barrier as a “wall system,” though Trump and lawmakers have at times said they would accept “a fence” or a “see-through wall.”

As we noted late last year, by leaving several controversial provisions – including an immigration deal – out of the continuing resolution passed just before Christmas, Republicans effectively set themselves up for a grueling legislative calendar early this year, as the battle over DACA, the re-authorization of a controversial surveillance program and the long-term fate of a popular children’s health-insurance program must be resolved in the coming months.

Aside from that, Trump is pushing to pass his $10 trillion infrastructure plan which was whispered about late last year – before the mid-term elections.

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