Iranian Hackers Targeted Treasury Officials, Atomic Scientists And…An Intern?

Move over China, Russia and North Korea – Iran is now vying for the title of America’s most threatening cyber nemesis. According to a report in the Associated Press, an Iranian hacking group known by the codename “Charming Kitten” has been caught by a private security firm trying to break into the email accounts of US nuclear scientists and policy makers, presumably to try and figure out what the US knows about Iran’s clandestine enrichment program, and what, exactly, is happening in the minds of America’s most senior policy setters.

Iran

After Trump reimposed sanctions against Iran last month (while offering a crucial backdoor in the form of oil -export waivers), the Iranian government rushed to try and infiltrate the accounts of people tasked with enforcing them.

AP‘s report included a summary of information provided by Certfa, which tracked how the hackers, who have ties to the Iranian regime, have tried to infiltrate the email accounts of US citizens over the past month using a surprisingly crude methodolgy: The so-called “phishing” attacks that rely on counterfeit emails to trick people in giving up their login information. The news follows a report earlier this week that the Marriott hack was orchestrated by Chinese intelligence agents.

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Those targeted by the Iranians include: Treasury officials, high-profile “defenders, detractors and enforcers” of the Iranian nuclear deal, Arab atomic scientists, Iranian civil society figures and even an intern at a DC think tank.

“Presumably, some of this is about figuring out what is going on with sanctions,” said Frederick Kagan, a scholar at the American Enterprise Institute who has written about Iranian cyberespionage and was among those targeted.

Kagan said he was alarmed by the targeting of foreign nuclear experts.

“This is a little more worrisome than I would have expected,” he said.

In an entertaining twist, Certfa was able to capture evidence of the Iranian hackers’ efforts after the group accidentally left its server open to the Internet last month. The server was promptly ransacked by the security firm, which extracted a list of 77 email addresses that had been targeted by the hackers.

The hit list surfaced after Charming Kitten mistakenly left one of its servers open to the internet last month. Researchers at Certfa found the server and extracted a list of 77 Gmail and Yahoo addresses targeted by the hackers that they handed to the AP for further analysis. Although those addresses likely represent only a fraction of the hackers’ overall effort – and it’s not clear how many of the accounts were successfully compromised – they still provide considerable insight into Tehran’s espionage priorities.

“The targets are very specific,” Certfa researcher Nariman Gharib said.

In a report published Thursday , Cerfta tied the hackers to the Iranian government, a judgment drawn in part on operational blunders, including a couple of cases where the hackers appeared to have accidentally revealed that they were operating from computers inside Iran. The assessment was backed by others who have tracked Charming Kitten. Allison Wikoff, a researcher with Atlanta-based Secureworks, recognized some of the digital infrastructure in Certfa’s report and said the hackers’ past operations left little doubt they were government-backed.

“It’s fairly clear-cut,” she said.

Perhaps the most alarming finding is that the hackers targeted nuclear scientists from rival Arab nations, a sign that the hackers had hoped to steal technology which could help Iranians speed up its enrichment of uranium.

Iran has previously denied responsibility for hacking operations, but an AP analysis of its targets suggests that Charming Kitten is working in close alignment with the Islamic Republic’s interests. The most striking among them were the nuclear officials — a scientist working on a civilian nuclear project for the Pakistan’s Ministry of Defense, a senior operator at the Research and Training Reactor in the Jordanian city of Ramtha, and a high-ranking researcher at the Atomic Energy Commission of Syria.

The trio suggested a general interest in nuclear technology and administration. Others on the hit list — such as Guy Roberts, the U.S. Assistant Secretary of Defense for Nuclear, Chemical, and Biological Defense Programs — pointed to an eagerness to keep track of officials charged with overseeing America’s nuclear arsenal.

“This is something I’ve been worried about,” Roberts said when alerted to his presence on the list.

Aside from policy makers involved with the initial Iran deal negotiated under the Obama administration, the hackers also targeted a Honeywell employee in charge of the industrial giant’s “emerging technology” unit…

Like the Russian hackers who have chased after America’s drone, space and submarine secrets, the list indicates that Iranian spies were also interested in the world of U.S. defense companies. One of those targeted is a senior director of “breakthrough technology” at the aerospace arm of Honeywell International Inc., the New Jersey-based industrial conglomerate; another is a vice president at Virginia-based Science Applications International Corp., a prominent Pentagon contractor.

Honeywell said it was aware that one of its employees had their personal account “exposed,” adding that there was no evidence that the company’s network was compromised. SAIC said it found no trace of any hacking attempt against its employee’s account.

…As well as – bizarrely enough – an intern at a DC think tank.

Another Charming Kitten target was an intern working for the Foundation for Defense of Democracies, a Washington think tank that has been one of the Iran deal’s fiercest critics. How the intern — whose email isn’t public and whose name appears nowhere on the organization’s website — crossed the hackers’ radar is not clear. The foundation issued a statement calling the revelation “yet another indicator that Iran must be viewed as a nefarious actor in all theatres in which it operates.”

And, of course, Treasury Department employees tasked with enforcing the sanctions against Iran.

An analysis of Certfa’s data shows the group targeted at least 13 U.S. Treasury employees’ personal emails, including one belonging to a director at the Financial Crimes Enforcement Network, which fights money laundering and terror financing, and one used by the Iran licensing chief at the Office of Foreign Asset Control, which is in charge of enforcing U.S. sanctions. But a few employees’ LinkedIn profiles referenced back office jobs or routine tax work.

That suggested “a fairly scattershot attempt,” said Clay Stevenson, a former Treasury official who now consults on sanctions and was himself targeted by Charming Kitten.

Cyberwarfare has been a feature of US-Iranian relations for decades (remember Stuxnet?). We now await revelations that, in addition to trying to steal nuclear secrets, the Iranians also sought to “destabilize” the US by circulating memes with pro-BML and pro-Hillary Clinton messaging.

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Bankers, Politicians, & Angry Citizens: Nomi Prins Exposes A World That Is The Property Of ‘The 1%’

Authored by Nomi Prins via TomDispatch.com,

The Inequality Gap on a Planet Growing More Extreme

As we head into 2019, leaving the chaos of this year behind, a major question remains unanswered when it comes to the state of Main Street, not just here but across the planet.

If the global economy really is booming, as many politicians claim, why are leaders and their parties around the world continuing to get booted out of office in such a sweeping fashion?

One obvious answer: the post-Great Recession economic “recovery” was largely reserved for the few who could participate in the rising financial markets of those years, not the majority who continued to work longer hours, sometimes at multiple jobs, to stay afloat. In other words, the good times have left out so many people, like those struggling to keep even a few hundred dollars in their bank accounts to cover an emergency or the 80% of American workers who live paycheck to paycheck.

In today’s global economy, financial security is increasingly the property of the 1%. No surprise, then, that, as a sense of economic instability continued to grow over the past decade, angst turned to anger, a transition that — from the U.S. to the Philippines, Hungary to Brazil, Poland to Mexico — has provoked a plethora of voter upheavals. In the process, a 1930s-style brew of rising nationalism and blaming the “other” — whether that other was an immigrant, a religious group, a country, or the rest of the world — emerged.

This phenomenon offered a series of Trumpian figures, including of course The Donald himself, an opening to ride a wave of “populism” to the heights of the political system. That the backgrounds and records of none of them — whether you’re talking about Donald Trump, Viktor Orbán, Rodrigo Duterte, or Jair Bolsonaro (among others) — reflected the daily concerns of the “common people,” as the classic definition of populism might have it, hardly mattered. Even a billionaire could, it turned out, exploit economic insecurity effectively and use it to rise to ultimate power.

Ironically, as that American master at evoking the fears of apprentices everywhere showed, to assume the highest office in the land was only to begin a process of creating yet more fear and insecurity. Trump’s trade wars, for instance, have typically infused the world with increased anxiety and distrust toward the U.S., even as they thwarted the ability of domestic business leaders and ordinary people to plan for the future. Meanwhile, just under the surface of the reputed good times, the damage to that future only intensified. In other words, the groundwork has already been laid for what could be a frightening transformation, both domestically and globally.

That Old Financial Crisis

To understand how we got here, let’s take a step back. Only a decade ago, the world experienced a genuine global financial crisis, a meltdown of the first order. Economic growth ended; shrinking economies threatened to collapse; countless jobs were cut; homes were foreclosed upon and lives wrecked. For regular people, access to credit suddenly disappeared. No wonder fears rose. No wonder for so many a brighter tomorrow ceased to exist.

The details of just why the Great Recession happened have since been glossed over by time and partisan spin. This September, when the 10th anniversary of the collapse of the global financial services firm Lehman Brothers came around, major business news channels considered whether the world might be at risk of another such crisis. However, coverage of such fears, like so many other topics, was quickly tossed aside in favor of paying yet more attention to Donald Trump’s latest tweets, complaints, insults, and lies. Why? Because such a crisis was so 2008 in a year in which, it was claimed, we were enjoying a first class economic high and edging toward the longest bull-market in Wall Street history. When it came to “boom versus gloom,” boom won hands down.

None of that changed one thing, though: most people still feel left behind both in the U.S. and globally. Thanks to the massive accumulation of wealth by a 1% skilled at gaming the system, the roots of a crisis that didn’t end with the end of the Great Recession have spread across the planet, while the dividing line between the “have-nots” and the “have-a-lots” only sharpened and widened.

Though the media hasn’t been paying much attention to the resulting inequality, the statistics (when you see them) on that ever-widening wealth gap are mind-boggling. According to Inequality.org, for instance, those with at least $30 million in wealth globally had the fastest growth rate of any group between 2016 and 2017. The size of that club rose by 25.5% during those years, to 174,800 members. Or if you really want to grasp what’s been happening, consider that, between 2009 and 2017, the number of billionaires whose combined wealth was greater than that of the world’s poorest 50% fell from 380 to just eight. And by the way, despite claims by the president that every other country is screwing America, the U.S. leads the pack when it comes to the growth of inequality. As Inequality.org notes, it has “much greater shares of national wealth and income going to the richest 1% than any other country.”

That, in part, is due to an institution many in the U.S. normally pay little attention to: the U.S. central bank, the Federal Reserve. It helped spark that increase in wealth disparity domestically and globally by adopting a post-crisis monetary policy in which electronically fabricated money (via a program called quantitative easing, or QE) was offered to banks and corporations at significantly cheaper rates than to ordinary Americans.

Pumped into financial markets, that money sent stock prices soaring, which naturally ballooned the wealth of the small percentage of the population that actually owned stocks. According to the Fed’s own Survey of Consumer Finances, “It is hardly a stretch to conclude that QE exacerbated America’s already severe income disparities.”

Wall Street, Central Banks, and Everyday People

What has since taken place around the world seems right out of the 1930s. At that time, as the world was emerging from the Great Depression, a sense of broad economic security was slow to return. Instead, fascism and other forms of nationalism only gained steam as people turned on the usual cast of politicians, on other countries, and on each other. (If that sounds faintly Trumpian to you, it should.)

In our post-2008 era, people have witnessed trillions of dollars flowing into bank bailouts and other financial subsidies, not just from governments but from the world’s major central banks. Theoretically, private banks, as a result, would have more money and pay less interest to get it. They would then lend that money to Main Street. Businesses, big and small, would tap into those funds and, in turn, produce real economic growth through expansion, hiring sprees, and wage increases. People would then have more dollars in their pockets and, feeling more financially secure, would spend that money driving the economy to new heights — and all, of course, would then be well.

That fairy tale was pitched around the globe. In fact, cheap money also pushed debt to epic levels, while the share prices of banks rose, as did those of all sorts of other firms, to record-shattering heights.

Even in the U.S., however, where a magnificent recovery was supposed to have been in place for years, actual economic growth simply didn’t materialize at the levels promised. At 2% per year, the average growth of the American gross domestic product over the past decade, for instance, has been half the average of 4% before the 2008 crisis. Similar numbers were repeated throughout the developed world and most emerging markets. In the meantime, total global debt hit $247 trillion in the first quarter of 2018. As the Institute of International Finance found, countries were, on average, borrowing about three dollars for every dollar of goods or services created.

Global Consequences

What the Fed (along with central banks from Europe to Japan) ignited, in fact, was a disproportionate rise in the stock and bond markets with the money they created. That capital sought higher and faster returns than could be achieved in crucial infrastructure or social strengthening projects like building roads, high-speed railways, hospitals, or schools.

What followed was anything but fair. As former Federal Reserve Chair Janet Yellen noted four years ago, “It is no secret that the past few decades of widening inequality can be summed up as significant income and wealth gains for those at the very top and stagnant living standards for the majority.” And, of course, continuing to pour money into the highest levels of the private banking system was anything but a formula for walking that back.

Instead, as more citizens fell behind, a sense of disenfranchisement and bitterness with existing governments only grew. In the U.S., that meant Donald Trump. In the United Kingdom, similar discontent was reflected in the June 2016 Brexit vote to leave the European Union (EU), which those who felt economically squeezed to death clearly meant as a slap at both the establishment domestically and EU leaders abroad.

Since then, multiple governments in the European Union, too, have shifted toward the populist right. In Germany, recent elections swung both right and left just six years after, in July 2012, European Central Bank (ECB) head Mario Draghi exuded optimism over the ability of such banks to protect the financial system, the Euro, and generally hold things together.

Like the Fed in the U.S., the ECB went on to manufacture money, adding another $3 trillion to its books that would be deployed to buy bonds from favored countries and companies. That artificial stimulus, too, only increased inequality within and between countries in Europe. Meanwhile, Brexit negotiations remain ruinously divisive, threatening to rip Great Britain apart.

Nor was such a story the captive of the North Atlantic. In Brazil, where left-wing president Dilma Rouseff was ousted from power in 2016, her successor Michel Temer oversaw plummeting economic growth and escalating unemployment. That, in turn, led to the election of that country’s own Donald Trump, nationalistic far-right candidate Jair Bolsonaro who won a striking 55.2% of the vote against a backdrop of popular discontent. In true Trumpian style, he is disposed against both the very idea of climate change and multilateral trade agreements.

In Mexico, dissatisfied voters similarly rejected the political known, but by swinging left for the first time in 70 years. New president Andrés Manuel López Obrador, popularly known by his initials AMLO, promised to put the needs of ordinary Mexicans first. However, he has the U.S. — and the whims of Donald Trump and his “great wall” — to contend with, which could hamper those efforts.

As AMLO took office on December 1st, the G20 summit of world leaders was unfolding in Argentina. There, amid a glittering backdrop of power and influence, the trade war between the U.S. and the world’s rising superpower, China, came even more clearly into focus. While its president, Xi Jinping, having fully consolidated power amid a wave of Chinese nationalism, could become his country’s longest serving leader, he faces an international landscape that would have amazed and befuddled Mao Zedong.

Though Trump declared his meeting with Xi a success because the two sides agreed on a 90-day tariff truce, his prompt appointment of an anti-Chinese hardliner, Robert Lighthizer, to head negotiations, a tweet in which he referred to himself in superhero fashion as a “Tariff Man,” and news that the U.S. had requested that Canada arrest and extradite an executive of a key Chinese tech company, caused the Dow to take its fourth largest plunge in history and then fluctuate wildly as economic fears of a future “Great Something” rose. More uncertainty and distrust were the true product of that meeting.

In fact, we are now in a world whose key leaders, especially the president of the United States, remain willfully oblivious to its long-term problems, putting policies like deregulation, fake nationalist solutions, and profits for the already grotesquely wealthy ahead of the future lives of the mass of citizens. Consider the yellow-vest protests that have broken out in France, where protestors identifying with left and right political parties are calling for the resignation of neoliberal French President Emmanuel Macron. Many of them, from financially starved provincial towns, are angry that their purchasing power has dropped so low they can barely make ends meet

Ultimately, what transcends geography and geopolitics is an underlying level of economic discontent sparked by twenty-first-century economics and a resulting Grand Canyon-sized global inequality gap that is still widening. Whether the protests go left or right, what continues to lie at the heart of the matter is the way failed policies and stop-gap measures put in place around the world are no longer working, not when it comes to the non-1% anyway. People from Washington to ParisLondon to Beijing, increasingly grasp that their economic circumstances are not getting better and are not likely to in any presently imaginable future, given those now in power.

A Dangerous Recipe

The financial crisis of 2008 initially fostered a policy of bailing out banks with cheap money that went not into Main Street economies but into markets enriching the few. As a result, large numbers of people increasingly felt that they were being left behind and so turned against their leaders and sometimes each other as well.

This situation was then exploited by a set of self-appointed politicians of the people, including a billionaire TV personality who capitalized on an increasingly widespread fear of a future at risk. Their promises of economic prosperity were wrapped in populist platitudes, normally (but not always) of a right-wing sort. Lost in this shift away from previously dominant political parties and the systems that went with them was a true form of populism, which would genuinely put the needs of the majority of people over the elite few, build real things including infrastructure, foster organic wealth distribution, and stabilize economies above financial markets.

In the meantime, what we have is, of course, a recipe for an increasingly unstable and vicious world.

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Trump Considering Jared Kushner For Chief Of Staff

President Trump is considering Jared Kushner to replace outgoing chief of staff John Kelly, according to the Huffington Post

Kushner – already an official Whiter House adviser – is reportedly one of five finalists Trump told reporters he had narrowed the pool down to on Thursday, while Kushner – Trump’s son-in-law, has indicated he is interested in the job according to a “top Republican close to the White House” in a statement to the Post

Kushner and Trump are said to have met on Wednesday to discuss the role. 

Kushner has been pushing his own candidacy with Trump, citing his work on a criminal justice reform package and a claimed ability to work with Democrats, one person said. “I don’t know why he thinks that, when the Democrats are mainly going to be coming after Trump,” the source said. –HuffPo

On Thursday Trump told reporters “We are ijnterviewing people now for chief of staff,” following the Saturday announcement that current chief of staff John Kelly would leave “toward the end of the year.” 

After Vice President Mike Pence’s chief of staff Nick Ayers announced his withdrawal from consideration after being favored as the top pick for the job. 

“Thank you @realDonaldTrump, @VP, and my great colleagues for the honor to serve our Nation at The White House. I will be departing at the end of the year but will work with the #MAGA team to advance the cause,” wrote Ayers. 

While Kushner is reportedly on Trump’s short-list for chief-of-staff, it is unclear who the other finalists are – though the thought of Newt Gingrich (or Jared Kushner) chasing Trump around the West Wing trying to get him to sign documents is hilarious. 

Former deputy campaign manager David Bossie is scheduled to have lunch with Trump Friday at the White House. Former House Speaker Newt Gingrich is also thought to be under consideration, while Trump is soliciting names from the legal community in New York City, where he lived his entire life before winning the presidency in 2016.

After Ayers turned the job down, Trump tried to recruit Treasury Secretary Steven Mnuchin, United States Trade Representative Robert Lighthizer, top economic adviser Larry Kudlow and North Carolina Republican Congressman Mark Meadows, all of whom declined, one source said. –HuffPo

Despite concerns over nepotism, perhaps Kushner is the perfect man for the job; after all, Mexico awarded him with the Order of the Aztec Eagle two weeks ago – the highest honor given to foreigners, typically reserved for kings, princes, dukes and emperors. And Jared Kusnner. 

 

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After A Disastrous Year For Hedge Funds, Here Are The Biggest Casualties

Closing the book on 2018 couldn’t come fast enough for the hedge fund industry, which has had a truly abysmal year, and which saw some quite notable casualties in the past 12 months.

This morning we reported the latest woes to beset Swiss multi-billion fund manager GAM Holdings, which after a series of internal scandals and underperformance, was hit with a record 4.2 billion Swiss francs in outflows in just the past two months, while quant fund losses and asset writedowns hammered total AUM which tumbled by over 24 billion Swiss francs, from CHF 84.4BN as of Jun 30 to just CHF 60.8BN as of Nov 30.

The good news is that while GAM may be suffering from a terminal redemption flight, it is still around to fight another day which is more than some other hedge funds can say.

Overnight, Bloomberg also reported that Philippe Jabre became the latest hedge fund manager to throw in the towel, when he announced he was returning money to investors after an “especially challenging” year, adding to the growing list of hedge-fund veterans giving up on an industry where money-making opportunities have dwindled as a result of the central bank take over of “markets.”.

The Geneva-based Jabre Capital Partners SA is returning client money in the three funds personally managed by Jabre, said Mark Cecil, one of the firm’s founding partners. The remaining two funds, one focused on emerging markets and the other on European credit, will keep operating with outside money, he said. Jabre, the founder and chief investment officer of his namesake firm, is selling positions in a “disciplined manner” and intends to return most of the proceeds by February, he wrote in an investor newsletter dated Dec. 12 and obtained by Bloomberg News. Jabre Capital managed about $1.2 billion of assets as of April with more than 40 employees.

“In previous periods, weakness created opportunities but as we survey the outlook for 2019, we are concerned that we don’t see those opportunities,” Jabre wrote in the letter. “Both the political and economic outlooks remain confused and without clear direction.”

In his letter to investors, Jabre, now in his late 50s, also said that “financial markets have significantly evolved over the last decade driven by new technologies and the market itself is becoming more difficult to anticipate as traditional participants are imperceptibly replaced by computerized models.”

Another hedge fund which is ruing the takeover of capital markets by central banks and vacuum tubes, and likely won’t be around much longer, is Convexity Capital Management, the once iconic hedge fund that was spun out of Harvard University’s endowment in 2005, and has seen its assets fall by almost half in the past year.  AUM at the fund overseen by Jack Meyer collapsed to just $1.6 billion at the end of November, according to Bloomberg. That’s down from about $3 billion last year and a peak of $15 billion in 2013 as the fund – like virtually all of its peers – has struggled amid the low-rate environment.

Paradoxically, Convexity saw aggressive redemptions even as it outperformed the majority of its peers as rising interest rates helped lift the fund’s performance in 2018. The Boston-based fund performed as much as 3.7% better than benchmarks through November. It trailed those points of reference by about 1.8% in the first half of last year.

Which begs the question: are the worst, most underperforming hedge funds quietly gating their clients, who are then forced to redeem funds at the more successful asset managers?

* * *

While Jabre’s decision to return capital from three of his hedge funds rocked the industry this week, closures have been a key theme of 2018. Indeed, the $3 trillion market is shrinking by number of funds as veterans who survived several business cycles throw in the towel. Money-making opportunities have dwindled with the downturn in stocks, while higher barriers to entry from regulation make it harder for new blood to come in.

But the biggest problem is also the simplest one: nobody really knows how to many money consistently in the current market.

This year has been an exceptionally tough one for hedge funds as asset prices tanked and volatility – usually a friend for money managers seeking benchmark-beating returns – returned after a period of calm. Wide price swings, a waning bull market and rising interest rates were seen as the elixir the $3.2 trillion industry needed to overcome years of subpar performance. Instead, many firms got pummeled in last month’s market swoon and are headed for their worst year since 2011.

One such fund is Jon Jacobson’s $12.1 billion Highfields Capital Management, which recently announced it would return client money after two decades, joining other well-known operators including Richard Perry’s namesake company, Eric Mindich’s Eton Park Capital Management LP and John Griffin’s Blue Ridge Capital LLC, which have all exited the industry over the past two years. Leon Cooperman, meanwhile, plans to convert his firm into a family office at the end of the year.

In total, an estimated 174 hedge funds were liquidated in the third quarter globally, outstripping new starts by 30, data from Hedge Fund Research Inc. show.

As a result, the $3 trillion market is shrinking by number of funds as veterans who survived several business cycles throw in the towel. Money-making opportunities have dwindled with the downturn in stocks, while higher barriers to entry from regulation make it harder for new blood to come in. According to a report from Eurekahedge, closures have outnumbered launches for the third year running: 580 funds decided to shut as of Dec. 3, compared with 552 openings.

Separately, data from Hedge Fund Research shows that there have been the fewest hedge-fund launches so far this year since 2000. This would be the 5th year in a which the total number of hedge fund launches has declined, and at only 450 YTD, would be the worst year for hedge funds since the year 2000.

No matter how one slices the data however, the $3 trillion market is shrinking by number of funds as veterans who survived several business cycles throw in the towel. Below is a partial list of some of the more prominent firms and funds that closed or turned into family offices (via Bloomberg):

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Criminal Probe Launched Into Trump Inauguration Spending, Donor Pay-To-Play Claims

After denying Michael Cohen’s claims in a tweetstorm today, and being told my Nancy Pelosi that Dems have started the process of trying to get his tax returns, it appears President Trump has yet more legal issues as The Wall Street Journal reports that federal prosecutors in Manhattan are investigating whether his 2017 inaugural committee misspent some of the record $107 million it raised from donations.

The committee raised more than double what former President Barack Obama’s first inaugural fund reported raising in 2009, the previous record.

The inaugural committee has publicly identified vendors accounting for $61 million of the $103 million it spent, and it hasn’t provided details on those expenses, according to tax filings. As a nonprofit organization, the fund is only required to make public its top five vendors.

According to the ubiquitous ‘people familiar with the matter’, WSJ reports that the criminal probe by the Manhattan U.S. attorney’s office, which is in its early stages, also is examining whether some of the committee’s top donors gave money in exchange for access to the incoming Trump administration, policy concessions or to influence official administration positions, some of the people said.

President Trump’s funds came largely from wealthy donors and corporations who gave $1 million or more – including casino billionaire Sheldon Adelson, AT&T and Boeing, according to Federal Election Commission filings. There is no sign that those three donors are under investigation.

All of which sounds like a deep state reach into possible Trump-Saudi connections (now that the Russia collusion narrative has collapsed).

The criminal probe reportedly arose from materials seized in Michael Cohen’s business dealings, after raids of his home, office, and hotel room which included a recorded conversation between Mr. Cohen and Stephanie Winston Wolkoff, a former adviser to Melania Trump, who worked on the inaugural events. In the recording, Ms. Wolkoff expressed concern about how the inaugural committee was spending money, according to a person familiar with the Cohen investigation.

The same ‘people familiar’ also note that prosecutors have asked Richard Gates, a former campaign aide who served as the inaugural committee’s deputy chairman, about the fund’s spending and its donors, and in recent months asked Tennessee developer Franklin L. Haney for documents related to a $1 million donation he made to Mr. Trump’s inaugural committee in December 2016.

The committee was headed by Thomas Barrack Jr., a real-estate developer and longtime friend of Mr. Trump. There is no sign the investigation is targeting Mr. Barrack, and he hasn’t been approached by investigators but WSJ reports that Mr. Barrack has said that an external audit was completed of the inaugural committee’s finances, but the organization has declined to make that audit available.

The White House didn’t respond to requests for comment on the investigation. A lawyer for Mr. Cohen didn’t respond to requests for comment, but the inaugural committee confirmed that it hasn’t been asked for records or been contacted by prosecutors, according to a lawyer close to the matter, who said:

“We are not aware of any evidence the investigation the Journal is reporting actually exists.”

So while this all sounds like yet another legally questionable aspect of the Trump administration, as is clear by the sparcity of The Wall Street Journal’s reporting, there is little – if anything – here so far and it once again appears more fishing expedition in search of a crime. And obviously, it builds on the public perception of corruption which we are sure Mueller’s report will strongly hint at – although being completely unable to prosecute the collusion.

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New York’s Top Court Shields Police Misconduct Records From Public View

Eric Garner protestsNew York’s top court on Tuesday blocked efforts to shine a light on the records of cops who misbehave on duty.

New York’s State Civil Rights Law has a section (50-a) that broadly seals the personnel records of police, corrections officers, and firefighters, even in cases of misconduct. As a result, whenever a police officer gets in trouble, citizens can’t know if he or she has been disciplined, and are unable to determine whether an officer has a history of bad behavior.

For the last six years, the New York Civil Liberties Union has been fighting for access to the records of officers brought before New York City’s Civilian Complaint Review Board. Initially, the NYCLU won an order for the police to release the information in a redacted format. But it was overturned on an appeal that was upheld Tuesday.

The judge who wrote Tuesday’s decision, Michael Garcia, made very clear that the purpose of the law is to shield police from not just “harassment,” but embarrassment, and to make it harder to use an officer’s disciplinary record to undermine his or her testimony.

Garcia detailed several New York state precedents, one of which states the purpose of section 50-a is to protect police against those who would use their records “as a means for harassment and reprisals and for purposes of cross-examination by plaintiff’s counsel during litigation.” The law is designed not just to protect the police officer’s privacy, but also their reputation and to shield them from legal liability.

The law does have a mechanism by which this seal of privacy can be broken, but it requires a judge to review requests individually and to then determine that the records are “relevant” to a specific action.

We’ve seen the outcome of this practice in the case of Eric Garner, who died after a NYPD police officer saw Garner selling loose cigarettes and put him in a chokehold. The personnel records of the officer responsible, Daniel Pantaleo, were kept secret under this state law, but somebody leaked documents to the press that showed a history of problems, including four abuse complaints that were substantiated by the NYC Civilian Complaint Review Board.

Pantaleo will finally face an administrative trial next year. The Garner case, meanwhile, has become not just a symbol of police brutality, but a reminder of how little members of the public can know about the armed men and women who have the legal authority to kill them.

Law enforcement unions are, of course, over the moon about the decision. Michael Palladino, the president of the Detectives’ Endowment Association, told The New York Times the decision was “exhilarating, especially in this climate.” This “climate” is not actually any more prone to violent retaliation against police than it has been in the past. Of the 140 deaths of law enforcement officers reported this year, 49 were due to gunfire, three to assault, and seven to vehicular assault. All of 10 police officers have died in service in New York State this year, several of them as a result of 9/11-related illnesses.

Perhaps Palladino is referring to the “climate” in California, where lawmakers this year finally stripped law enforcement officers of similarly overbroad “protections” that prevented the public from knowing about officers’ past misconduct. Lawmakers in New York are hoping to follow in California’s footsteps and open up these records next year.

Read the ruling here.

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Gold – A Perfect Storm For 2019

Authored by Alasdair Macleod via GoldMoney.com,

This article is an overview of the principal factors likely to drive the gold price in 2019. It looks at the global factors that have developed in 2018 for both gold and the dollar, how geopolitics are likely to evolve, the economic outlook and how it is worsened for the dollar by President Trump’s tariff war against China, the availability and likely demand for bullion, and the technical position in paper markets. Taken together, the outlook is bullish for gold.

2018 reprise

For gold bulls, 2018 was disappointing. From 11 December 2017, when gold made a significant bottom against the dollar at $1243, it has ended virtually unchanged today, after being 4.2% up. Gold had to struggle against a rising dollar, whose trade-weighted index rose a net 3.7% over the same period, and as much as 9.4% from its mid-February low.

Dollar strength has been driven less by trade imbalances and more by interest rate differentials. A speculating bank for its own book or for a hedge fund client can borrow 3-month Euro Libor at minus0.354% and invest it in 3-month US Treasury bills at 2.36%, for a round trip of over 2.7%. Gear this up ten times or more, either on a bank’s capital, or through reverse repos for annualised returns of over 27%. To this can be added the currency gain, which at times has added enough to overall returns for an unhedged geared position to double the investment.

Not that these forex returns have been guaranteed, but you get the picture. The ECB and the Bank of Japan have been frozen into inactivity, reluctant to raise rates to correct this imbalance, and the punters have known it.

Financial commentators have routinely misunderstood the fundamental reason for the dollar’s strength, attributing it to foreigners’ desperate need for dollars. In fact, non-US holders of dollars hold it in record amounts, with over $4 trillion in deposits in correspondent bank accounts alone, and a further $930 billion in short-term debt. This $5 trillion of total liquidity was the last reported position, as at end-June 2017. Speculative dollar demand since then, driven by interest rate differentials, will have added significantly to these figures. The continuing US trade deficit, currently running at close to a trillion dollars annually, is both an associated and additional source of dollar accumulation in foreign hands.

Meanwhile, the same US Government data source reveals that US residents’ holdings of foreign securities was $6.75 trillion less than the foreign ownership of US securities, and the US Treasury reports that major US market participants (i.e. the US banks and financial entities operating in the spot, forwards and futures contracts) sold a net €2.447 trillion in the first nine months of 2018. Assuming these sales were not absorbed by official intervention on the foreign exchanges or by contracting bank credit, they can only have added to foreign-owned dollar liquidity.

To summarise the point; far from there being a dollar shortage, as market participants believe, the world is awash with dollars to an extraordinary degree.

The great dollar unwind is now overhanging markets, which will remove the principal depressant on the gold price. And when it begins, as a source of supply these hot-money dollars will be seen as the continuation of escalating supply, with the prospect of future US trade and budget deficits to be discounted. These dynamics are a duplication of those that led to the failure of the London gold pool in the late-sixties, which led to the abandonment of the Bretton Woods gold-dollar relationship in 1971. And as I argue later in this article, the supply of physical liquidity in bullion markets to satisfy demand arising from dollar liquidation is extremely tight.

Geopolitics and gold in 2018

It is likely that at a future date we will look back on 2018 as a pivotal year for both geopolitics and gold. Russia has moved to a position whereby it has substantially replaced its dollar reserves with physical gold. It is now able, if it should care to, to do away with the dollar entirely for its energy exports payments. It is even possible for it to link the rouble to gold.

China took the seemingly innocuous step of launching an oil contract denominated in yuan. It had prevaricated since at least 2014 before making this move, presumably conscious that it was an in-your-face threat to the monopoly of the dollar in pricing energy.

There was expectation that the oil-yuan futures contract would be a segway into a yuan-gold futures contract either in Hong Kong or Dubai, allowing countries such as Iran to avoid receiving dollars entirely. And indeed, a number of gold exchanges and interests in Asia have banded together to open a 1500-tonne vault in Qianhai to facilitate gold storage resulting from pan-Asian trade flows.

These include the China Gold and Silver Exchange Society, the Hong Kong Gold Exchange, and gold market interests in Singapore, Myanmar and Dubai. The objective is to give Hong Kong the opportunity to coordinate Asian gold markets and develop a “gold corridor” for the countries along China’s Belt and Road initiative. Therefore, both private and public sectors will be able to accumulate the oldest form of money as a backstop to local currencies, as an alternative to accumulating those of their trading partners.

Geopolitics evolved from fighting proxy wars in the Middle East and Ukraine, which were effectively won by Russia, to the less obvious war of trade tariffs. President Trump has styled himself as “A Tariff Man”. We have presumed that he is ignorant of economics, but that is no longer the point. Tariffs have evolved from a policy to make America great again to bankrupting China. China is seen as the greatest economic threat to America, and in this duel, tariffs are Trump’s weapon of choice.

The objective is to impede China’s technological development. It was tolerated when China, to steal a line from Masefield’s Cargoes, was the world’s supplier “…of firewood, iron-ware and cheap tin trays”. But China is moving on, creating a sophisticated economy with a technological capability that is arguably overtaking that of America. The battle for technological supremacy came out into the open with the detention on 1 December in Vancouver of Meng Wanzhou, the CFO of Huawei. Huawei is China’s leading developer of 5G mobile technology, installing sophisticated equipment around the world. 5G’s capability will make internet broadband redundant and will become widely available from next year.

Ms Meng’s arrest represents such an escalation of deteriorating relations between China and America that many assume it was ordered by rogue elements in America’s deep state. Maybe. But these things are difficult to reverse: does America tell the Canadian authorities to just let her go? It would uncharacteristic for America to admit a mistake, and it would probably need President Trump to personally intervene. This is difficult for him because application of the law is not in his hands.

If Ms Meng is not released, we will enter 2019 with the Chinese publicly insulted. They will realise, if they haven’t already, that ultimately there can be no accommodation with America. Fighting tariffs with more tariffs is a policy that will achieve nothing and damage China’s own economy.

It therefore becomes a matter of time when, and not if, China deploys financial weapons of its own. These will be targeted at the US’s obvious weaknesses, including her dependency on China for maintaining and increasing holdings in US Government debt. The increasingly compelling use of physical gold to both protect the yuan from attack in the foreign exchanges and limit the rise of yuan interest rates would serve to insulate China from the fall-out of a collapsing dollar.

The economic outlook, and the effect on the dollar

For market historians, the economic situation rhymes strongly with 1929, when the Smoot-Hawley Tariff Act was being debated. Eighty-nine years ago, the first round of votes in Congress was passed on 30 October, and Wall Street fell heavily that month in anticipation of the result. Following the G20 meeting two weeks ago, where it was vainly hoped there would be progress in the tariff negotiations between the US and China, markets fell heavily, reminding market historians of the 1929 precedent.

When President Hoover stated his intention to sign Smoot-Hawley into law on 16 June 1930, Wall Street crashed again. The lesson for today is that equity markets are likely to crash again if Trump continues with his tariff policies. Smoot-Hawley raised import tariffs on over 20,000 imported raw materials and goods, increasing the average tariff rate from 38% to over 60%. The difference today is that instead of tariffs being used only for protectionism, they are being targeted specifically against China.

There will be two likely consequences. The first is the the undermining of financial markets, which in the 1930s led to the virtual collapse of the US banking system and the global depression. And secondly, there is the escalation of a wider financial war raging between China and the US. These two factors are potentially very serious, with stock markets already on shaky ground.

This is not the uppermost reason for market weakness in investors’ minds, who worry about the economic outlook more generally. The conventional credit cycle features rising interest rates as a consequence of earlier monetary expansion, and the exposure of malinvestments. Markets discount the phases of the credit cycle when they become apparent to far-sighted investors, and only indirectly contribute to the collapse itself. But when valuations have become wildly optimistic, the fall in markets becomes a crisis on its own, contributing to the collapse in business that follows. This was the point taken up by Irving Fisher in the wake of the 1929-32 bear market.

In any event, the global economy appears to be at or close to the end of its expansionary phase, and is heading for recession, or worse. As well as the potential impact from an unanchored reserve currency, price inflation in the US will be boosted by Trump’s tariffs, which amount to additional consumer taxes. Price inflation pressures will then call for further rises in interest rates, while economic prospects will point to easing monetary conditions.

We have yet to see how this will be resolved. A further problem is that an economic downturn will increase government welfare commitments and therefore borrowing requirements. Bond yields will tend to rise and therefore borrowing costs, driving spendthrift governments into a debt-trap, just when price inflation is likely to demand higher interest rates. The most likely outcome will be further losses of fiat currencies’ purchasing power.

The 1930s depression saw a rising purchasing power for the dollar, with all commodity and consumer prices declining. The dollar was on a gold standard, and prices were effectively measured in gold, the dollar acting as a gold substitute. This is no longer true, and the purchasing power of the dollar, along with all other fiat currencies will at best remain stable measured against consumer products, or more likely will decline. In other words, a severe recession which looks increasingly likely on cyclical grounds, will lead to higher gold prices, irrespective of fiat currency interest rates.

The gold-fiat relationship and monetary inflation.

According to the World Gold Council, central bank gold reserves total 33,757 tonnes, worth $1.357 trillion at current prices. Global fiat money is estimated to total about $90 trillion, which suggests there’s 66 times as much in global cash and bank deposits as there is gold to back it.[iii] Admittedly, issuers have different gold-to-currency ratios, but overall this suggests the gold price would be far higher if a sustainable level of currency convertibility is to return.

The reason we must consider this relationship is that in the light of all the foregoing, the gulf between the two quantities is set to accelerate from the currency side.

In the early 1930s, dollar prices of raw materials and commodities fell heavily, bankrupting farmers and miners world-wide. The purchasing power of the dollar rose, because it acted as a gold substitute. Today there is no convertibility between the dollar and gold at all, so the effect of a global economic depression is bound to see the gulf between the dollar and gold widen, as central banks expand the quantity of money in an attempt to fight recession and keep their governments solvent. There can be no doubt the policy response from the Fed and all the other welfare-state central banks will be neo-Keynesian, exploiting all the freedoms of unsound money.

In fact, the increase in the money quantity is not new, dating from the Lehman crisis. This is shown in the chart below, of the fiat money quantity, compared with its long-term pre-Lehman growth path.

FMQ is basically the sum of true (Austrian) money supply and commercial bank reserves held at the Fed. Even though its growth has recently stalled, the gap between the pre-Lehman crisis growth path still stands at $5.55 trillion.

Now imagine what will happen when the global economy stalls. The Fed, along with other central banks, will be forced to make yet more currency available to support the banks, finance government spending and encourage consumption. The injection in the US last time was roughly $10 trillion, or 55% of GDP. Next time, with interest rates needing to be maintained in order to support the currency, it will almost certainly require more aggressive quantitative easing, with central banks substantially increasing their purchases of government bonds.

Gold is already close to all-time lows, relative to the money quantity. This is shown in the next chart.

It was from similar indexed levels that gold bottomed in the late sixties. A return to the level set by President Roosevelt in January 1934 implies a price of $53,250 today. This is not a forecast, and its only relevance is to illustrate the potential for an upward adjustment in the gold price, based on the degradation of the dollar since 1934.

Physical factors

Demand for physical gold consistently exceeds mine supply. Central banks are accumulating bullion, adding 425 tonnes in the year to September 2018. Chinese private sector demand continues at a steady pace, which measured by withdrawals from the Shanghai Gold Exchange, is running at a 1,900-tonne annualised rate. India’s total gold imports were 919 tonnes in the year to end-September (according to the World Gold Council), so adding identified central bank demand to private sector demand from India and China, these three sources account for 3,344 tonnes annually, which is the same as global mine supply.

The supply/demand balance is more complicated than these figures suggest. Some of the mine supply is not available to markets. For example, China, which is the largest mine supplier by far, severely restricts gold exports. Official reserves at central banks are only what are declared and includes gold out on lease or swapped, and therefore not in possession of the central bank. They are therefore short of actual possession, exposing them to potential counterparty and price risk.

Net demand from the rest of the world and from unrecorded categories is satisfied from the existing above-ground stock of bullion, which we estimate to be about 175,000 tonnes. Only an unknowable fraction of this is available for market liquidity. The most identifiable swing-factor is ETF demand, which saw outflows of 103 tonnes in the three months to September[iv]. Looking back over recent years, another substantial ETF outflow was in 2016 Q4, when the gold price bottomed, and in 2015 Q2 to Q4 saw net outflows every quarter. It appears that ETF demand is acting as a contrary indicator of future price trends.

This fits in with market theory, which based on investor psychology predicts investors are at best trend-chasers, investing most heavily at market tops and liquidating positions at price lows. The peak of net ETF liquidation in 2018 was in June and August. In June the gold price breeched the psychologically important $1300 level, and in August the market turned higher at $1160. ETF net selling tells us therefore the gold price may have recently indicated a turning point.

Supply from ETFs at market lows satisfies demand from those that have a continuing demand. We have seen the pattern of central banks increasing their buying on lower prices, but there is also some evidence commercial banks are accumulating bullion for their own books, possibly for risk purposes.

Under the new Basel III standard, physical gold held on an allocated basis is now classified as cash and has the advantage of zero risk weighting, compared with a 15% haircut under Basel II. Besides physical cash notes (which in practice banks try to minimise in their branches), the only other alternative to cash is balances held on the bank’s account at a central bank. The ECB and the Bank of Japan charge negative interest rates on these balances, which for commercial banks in the EU and Japan leaves only physical gold as an alternative.

For the thinking banker, it makes sense to hedge fiat currency exposure (which is the entirety of his business) with some physical bullion. The opportunity cost in the form of lost interest is not a factor, with overnight money-market rates in euros and yen negative. And the regulatory cost of holding gold is being removed.

A brief analysis of the availability of physical supply points to acute shortages on any expansion of demand. Seasonal factors can have a significant impact, with the Diwali festival in India a month ago, and the Chinese New Year in early February leading to an accumulation of bullion inventories.

The absorption of available liquidity from mine supply and scrap recycling tells us the physical market has become extremely tight. Instability in fiat currencies, particularly weakness developing in the dollar’s trade-weighted index, could therefore have a disproportionate effect on the gold price as a wide range of investing institutions and commercial banks try to correct their almost zero asset allocation to gold.

Paper markets for gold

As the chart below shows, gold bottomed in December 2015, since when it has been in a narrowing consolidation. Within this pattern, there is a seasonal effect, whereby gold sells off in early December and subsequently rallies. This is shown by the three black arrows on the chart.

There are reasons why this is so. The December contract is the last active contract to expire before the year end, when many hedge funds and bullion banks make up their accounts. Hedge fund managers want to present a balance sheet with less risk exposure than they normally run, and banks will wish to present shareholders and regulators with a sanitised version of their risk exposure as well.

This exposure cycle has had an extra twist this time, because market speculators in futures markets have shorted a wide range of futures in order to capture a strong dollar. In the case of the Comex gold future, this has led to an unprecedented technical position, shown in the next chart.

Over the last twelve years, hedge funds (which are represented in this category of speculator) have only been net short of Comex gold contracts twice. The first time was in late-2015, which marked the end of the 2011-15 bear market, and the second was recently, marking the sell-off to $1160. The only reason it has partially corrected is due to the expiry of the December contract.

Market sentiment is still markedly pro-dollar and anti-everything else, including gold. The underlying assumption appears to be that foreigners require dollars and the dollar has the highest interest rates of the major currencies. This being the case, the first supposition is an error. There is a growing expectation that the US economic growth will slow next year, and the Fed is under pressure not to raise rates any further.

When these changing factors are taken into account, the dollar is likely to be sold, and hedge fund speculators will take the other tack. The market-makers, traditionally the bullion banks, are bound to be aware of this possibility and will therefore try to maintain an even book.

Conclusion

All factors examined in this article point to higher gold prices in 2019. They can be summarised as follows:

  • The world is awash with dollars at a time when markets act as if there is a shortage. When the truth emerges, the dollar has the potential to fall substantially against other currencies, leading to a rise in the price of gold.

  • The move towards gold and against the dollar in Asia accelerated in 2018, with Russia having replaced the dollar with gold as its principal reserve currency. China has laid the foundation with an oil-yuan futures contract, which can be a bridge to yuan-gold contracts in both Hong Kong and Dubai. This is a direct challenge to the dollar as a reserve currency, and likely to be attractive to oil suppliers, such as Iran, seeking to circumvent use of the dollar and accumulate gold instead.

  • America’s trade war against China appears to be less about unfair trade practices and more about stopping China from evolving into a serious technological competitor against the US. In 2019, there is a strong possibility the tariff war will escalate into a wider conflict, with China selling down its exposure to the dollar and US Treasury debt. That would create significant difficulties for the US Government and the dollar itself.

  • With the credit cycle turning and the addition of American tariffs, markets are at a growing risk of replicating the 1929-32 crash and the economic depression that followed. This time, instead of commodities and consumer products effectively priced in gold through a gold standard, they will be priced in fiat currency. Monetary policies will ensure liquidity is freely available to support the commercial banks, government spending and economic activity. This is a recipe for higher gold prices.

  • Demand for physical gold continues to outstrip mine supply. In 2019, risk-weighting rules in Basel III open up the opportunity for commercial banks to augment their liquidity with allocated bullion, attractive to euro- and yen-based banks who face negative interest rates on short-term cash alternatives.

  • The technical position in the paper markets looks favourable, with close to record levels of bearishness, and an established pattern of December rallies in the gold price.

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Why Is the Trump Administration Trying to Deport Thousands of Vietnamese Immigrants?

In the years following the Vietnam War, thousands of refugees fled the North Vietnamese regime for the United States. Now, many of those immigrants could face possible deportation back to Vietnam.

In 1995, the United States reestablished official diplomatic relations with Vietnam. Then, in 2008, former President George W. Bush reached a memorandum of understanding (MOU) with the Vietnamese government that protected refugees who came to the U.S. before 1995 from being deported.

The Trump administration has been trying to reinterpret that MOU for a while. In March 2017, the administration claimed the agreement does not cover non-citizen Vietnamese immigrants who have been convicted of a crime, according to Business Insider. The administration started rounding up these immigrants, but there was significant pushback from the Vietnamese government as well as immigration activists in the U.S. The administration ceased its campaign in August, by which point only about a dozen immigrants had been deported, The New York Times reported last month.

But it appears the administration is trying again. James Thrower, a spokesperson for the U.S. embassy in Hanoi, confirmed as much to The Atlantic. “The United States and Vietnam signed a bilateral agreement on removals in 2008 that establishes procedures for deporting Vietnamese citizens who arrived in the United States after July 12, 1995, and are subject to final orders of removal,” he told the magazine. “While the procedures associated with this specific agreement do not apply to Vietnamese citizens who arrived in the United States before July 12, 1995, it does not explicitly preclude the removal of pre-1995 cases.”

Separately, a State Department spokesperson suggested to The Hill that if the administration wants to deport the immigrants in question, it can. “While the procedures associated with this specific agreement do not apply to Vietnamese citizens who arrived in the United States before July 12, 1995, it does not explicitly preclude the removal of pre-1995 cases,” the spokesperson explained.

The State Department also confirmed to multiple outlets that the Department of Homeland Security has met with representatives from Vietnam’s U.S. embassy. “The U.S. Government and the Vietnamese Government continue to discuss our respective positions relative to Vietnamese citizens who are now subject to final orders of removal,” a State Department spokesperson told HuffPost.

So what does it all mean? According to Katrina Dizon Mariategue, director of national policy at the nonprofit Southeast Asia Resource Action Center (SEARAC), 8,600 Vietnamese immigrants who have final orders of removal could be at risk of deportation. “We’re already receiving emails from individuals expressing their concern about these meetings and how their families will be separated because of it,” Mariategue told HuffPost.

Even if they were convicted of a crime, many of the immigrants in question have already served their time. “Many of these cases—they only committed one crime and that was decades ago,” Tania Pham, an attorney for some of the immigrants, told the Pacific Standard. “They have been rehabilitated. These are examples that the prison system did work for them. They proved themselves that they were able to function after release from prison.”

It’s worth noting that the Trump administration might have a hard time deporting so many immigrants. The Vietnamese government hasn’t exactly been amenable to the idea of accepting the refugees back. Without their cooperation, those thousands of deportations won’t happen. However, that could change if the two countries decide to renegotiate the agreement, which is up for renewal in January.

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The ‘Other’ America (That MSM Won’t Let You See)

Lies, #resistance, nationalism, hate speech, racism, #metoo, white supremacy, socialism, nazis… and Russians!?

This is the America spewed in to Americans’ brains 24/7 by the mainstream media as “the middle” has been lost.

But every now and again, something happens that allows ‘average joe’ Americans to reflect proudly on their nation, be patriotic, and share empathy with those who honorably do Washington’s bidding without question.

In a video taken at Nashville International Airport in Tennessee, Jen Tringale caught the following faith-restoring moment on her phone and posted to Facebook:

“I witnessed an international airport come to a complete stop today…

At the Nashville airport I walked out into the concourse to this scene @americanairlines was flying a plane full of children who had lost a parent in combat to Disneyworld [sic] on an all-expenses-paid trip and they threw a party for them at the gate.

But when they announced them over the loud speaker and they lined up to board the plane, the whole airport literally stopped and sang the national anthem with military present in salute.

Most every person standing around, myself included, was bawling at the sight of these kids and spouses who have paid so great a price for our country. To see all of this at Christmas time was so humbling. Seeing the general public in an airport stand still to honor these kids was simply beautiful.”

If you can watch the following clip without a tear in your eye, you’re dead inside…

The kids appeared to enjoy themselves and perhaps for a moment forgot about the hardships they face…

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Draghi Dud But Banks Break, Trannies Tumble, & Cryptos Crash

BTFD has transformed into STFR – maybe it’s better not to play…

China was well bid overnight (extraordinarily so)…but faded in the afternoon session…

 

European stocks gapped up at the open but faded

“Constructive” was the word of the day in Europe as everyone read from the same script on Italy…

 

US futures rallied into the European Open and rallied into the US Open, but were dumped after each…

Trannies tanked on the day (see Airlines below), but all major indices gave up early gains as Secretary Ross warned that China’s current actions are not enough… By the close The Dow managed to get back green and S&P unchanged…

Short interest on SPY, the world’s largest exchange-traded fund with more than $250 billion in assets, has jumped to 5.3 percent or shares outstanding, according to data compiled by Markit.

This is the 5th “sell the f**king rip” day in a row…

Airline stocks crashed after Delta’s 2019 profit view missed analysts’ estimates, prompting concerns about weakening pricing power

 

Bank stocks resumed their downtrend after a brief respite yesterday…

 

GE soared pre-market as JPMorgan’s analyst took his foot off its throat…but faded from the open…

 

FANG stocks sold off…

 

Treasuries were mixed today with the long-end underperforming and the belly and short-end bid (but all very modestly)…

 

10Y Yields bounced off the 2.80% support once again…

 

The Bill curve is getting more perturbed through the potential shutdown date as liquidity preferences have bid the shortest-dated bills…

 

 

The Dollar managed gains on the day retracing yesterday’s losses…

 

Draghi is losing his touch as EUR ended the day unchanged…

 

Yuan faded after China closed…

 

Cable held on to yesterday’s May confidence vote gains…

 

Cryptos crashed late in the day amid headlines of a Bitcoin Bomb-Scare scam…

 

Crude soared back to the early week high, copper, gold and silver lagged…

 

WTI was well bid after Saudi export cut headlines…WTI tagged $53 high stops

 

Gold in Yuan also fell into the red on the week…

 

Finally, we note that The Fed is back in the position of being more hawkish than The ECB… just barely…

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