Tag: finance

Before beginning the long journey by train back to North Korea – a trip that will give him an opportunity to meet face-to-face with senior Chinese officials, and possibly President Xi himself – Kim Jong Un met with Vietnamese officials on Friday as speculation mounted about what the collapse of the talks in Hanoi might mean, not only for the detente between the US and North Korea, but for the US’s trade deal with Beijing.

As analysts parse comments made by senior North Korean officials during a midnight press conference, many fear that Kim might restart his missile tests and revert to his belligerent anti-US rhetoric as the country’s 25 million citizens are struggling through its worst economic recession in 20 years.

According to Bloomberg, hardliners in his government believe a more warlike posture would improve Kim’s negotiating position. But that doesn’t necessarily mean a total collapse of the US-North Korea detente is inevitable.

“Kim also invested a lot in the summit,” said Shin Beomchul, director at the Seoul-based Asan Institute for Policy Studies’ Center for Security and Unification. “Kim’s domestic political risk is also high.”

The summit’s collapse reinforced the fundamental choice facing North Korea: Negotiate with the U.S. or force another nuclear crisis to improve its bargaining position. While it’s hard to know which path Kim will choose, a hard-line approach risks plunging him back into the diplomatic isolation he experienced before an unprecedented year of summits and red-carpet receptions.

Despite a North Korean vice premier’s warning that Kim may have “lost the will” to continue negotiating, it’s looking increasingly likely that Kim will keep talking, and possibly benefit from some additional help from Beijing. During a press conference on Friday, Chinese Foreign Ministry Spokesman Lu Kang said the UN should consider modifying the North Korean sanctions regime to allow the hermit kingdom some economic relief.

United Nations Security Council should consider holding a debate to modify sanctions against country, Chinese Foreign Ministry spokesman Lu Kang says.

Lu responds to question in Beijing briefing Friday about breakdown in nuclear talks between the U.S. and North Korea.

President Trump said Thursday that the North had demanded the immediate lifting of all international sanctions – including the six rounds of UN sanctions administered since its 2016 nuclear test in exchange for closing its biggest nuclear facilities under the supervision of US monitors.

Coverage of the summit by North Korean state media offered a decidedly positive view of the summit, glossing over the tensions between the two leaders and committed Kim to further negotiations.

Still, if the North doesn’t see some economic relief soon, worsening hardship could strengthen hardliners’ demands for a return to a more confrontational approach with the US.

Still, Kim faces his own time pressure to escape a U.S.-led campaign that helped push his already impoverished country into its deepest recession in two decades, according to the South Korean central bank. North Korean diplomats said talks broke down after the U.S. refused to support lifting sanctions imposed since 2016 in exchange for dismantling its aging Yongbyon nuclear complex.

That demand appears to cover five rounds of United Nations Security Council measures approved since North Korea’s fifth nuclear bomb test in September 2016. Those penalties, which would require U.S. support to undo, include everything from restrictions on North Korea’s oil imports to a ban on its export of iron and coal.

Still, China’s “strategic decision” to improve its relationship with the North (not to mention the thaw between North and South Korea) suggest that Kim can do more by leveraging his international partnerships to secure more concessions from the US. And though President Trump was willing to walk away on Thursday, should ties between the US and the North completely unravel, he would be forced to walk back all of his glowing pronouncements about Kim, and his boasts about the warming relationship with North Korea being a singular geopolitical triumph.

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

Authored by Garikai Dzoma via TechZim.com,

When you see the list of things Zimbabwe imports it’s hard for you not to wonder: Is there something this country does not import? I mean we import everything from razor blades to matches. Now you can add another thing to the list: USD currency.

Yes, we import those flashy dollar bills and most of them come from South African banks. Unfortunately due to something called de-risking all South African banks have either terminated access to this cash or have given notice that they will no longer be supplying Zimbabwean based banks/businesses with USD cash.

According to William Manimanzi, the Deputy director of financial markets at the RBZ the problem could be a result of the fact that we are not officially a dollar economy

I think you are all aware that we are not officially dollarised. When I say officially dollarised, I mean we don’t have an agreement with the United States that we were going to adopt their currency officially; we just unofficially dollarised. What that means is it’s very difficult to bring cash (USD) in this economy. Where do we get our cash (USD) from? Ordinarily, we import from South Africa and most of the banks due to what is called de-risking issues, have now given us notice that they can no longer provide our own local banks with cash. So we are in a catch 22 situation. The only bank remaining was FNB and they gave notice in December that they will no longer supply our own local banks with cash.

This is hurting money transfer agents

This has been hurting money transfer agents a lot. Recipients expect to receive their hard currency intact. This means money transfer agents have been importing cash into Zimbabwe and they are getting this cash from South African banks who like dominos have been terminating MTA (money transfer agents) accounts.

This has also hurt the gold business as small scale miners expect to be paid in cash.

What is de-risking

According to World Bank:

Global financial institutions are increasingly terminating or restricting business relationships with remittance companies and smaller local banks in certain regions of the world – a practice that is called “de-risking.”

• de-risking is indeed happening in pockets around the world – but its effects are unevenly distributed, with some regions more affected than others.

• Smaller countries with limited financial markets are particularly vulnerable to de-risking practices, and we are seeing evidence of this, notably in the Caribbean region.

…and why are South African banks doing it

( lots of paragraphs where I am speculating)

All the banks seem to be saying that there is a risk associated with dealing with MTAs and Zimbabwe’s banking institutions. According to the World Bank de-risking is happening because banks are weighing the cost and benefits of maintaining these accounts/relationships and coming to the conclusion that they are not worth the trouble.

For Zimbabwe, it can really be a sanctions issue. ZIDERA is ostensibly about targeted sanctions blah blah but the truth is that it sends the message that Americans have not really warmed up to our government or Zimbabwe as a whole. If you didn’t know, the truth is that the U.S pretty much has a hegemony over the world’s financial systems. The fact that we are using the USD without permission puts us further firmly within their grasp.

MTAs already suffer from a  high risk of what are known as ML/TF (money laundering/terrorist financing ) risks. Experience has shown that terrorists and money launders and fraudsters make constant use of these channels. Banks these days live in fear of being on the receiving end of the wrath of anti-money laundering/counter-terrorist financing (AML/CTF) regulatory authorities.

When it comes to fining banks for violating agreements and rules the U.S is really up there. They really know how to crack the whip. The risk for SA banks that someday they may be summoned and having their behinds lashed is probably too high compared to what the accounts are bringing in.

via ZeroHedge News https://ift.tt/2GRmSj3 Tyler Durden

The share of foreigners who own Danish fixed-rate mortgages has peaked at an all-time high of 32%, three times what it was in 2012, reports Bloomberg. 

As a result of the world’s largest mortgage-backed covered bond market being so attractive to outside buyers, Danish mortgages are incredibly low, as local home buyers can find a 30-year fixed rate loan of just 1.5 percent. 

The primary buyers of Danish AAA-rated bonds are Japanese and German investors. The central bank, meanwhile, has warned that a “dependence on foreign investors can increase market fluctuations in times of crisis.”

Timothy Smal, head of fixed income at Silkeborg, Denmark-based Jyske Bank, says the risk of a sudden exit from the market is small, given that this is “not a homogeneous group.” –Bloomberg

“The fact that Denmark probably isn’t their main place for investing might make it easier for them to exit the market,” Smal told Bloomberg in a phone interview. That said, “at the moment there’s no sign of things heading that way.“

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

Authored by George Pickering via The Mises Institute,

With scarcely a month left until the date Britain is scheduled to leave the European Union, the monetary czars at the top of the world’s central banks are increasingly coming to terms with the fact that a ‘hard’, no-deal Brexit now seems to be the most likely outcome. Given Parliament’s recent, overwhelming rejection of Theresa May’s long-negotiated Brexit deal, and the clock rapidly running down on any hope for renegotiation, it looks like the type of Brexit looming on the horizon will be verging on a central banker’s worst nightmare: an abrupt disruption to existing institutions, with all the economic uncertainty that entails, rather than the slow, politically-managed transition period May and others were hoping for.

As the formerly remote prospect of a no-deal Brexit draws ever closer, central banks around the world have begun laying out their plans to shield their respective economies from the turmoil many mainstream analysts are expecting. Little wonder that many of these contingency plans centre around the most important, and most dangerous, policy tool in the central banker’s arsenal: their ability to inflate the money supply and keep interest rates artificially low. 

In the UK itself, monetary policymakers at the Bank of England have indicated that a no-deal Brexit could lead to a reversal of the Bank’s current gradual normalization of interest rates. After having dropped the important ‘Bank rate’ of interest to the historic low of 0.25% in the aftermath of the June 2016 Brexit referendum, the Bank of England has subsequently raised it again twice, to its current level of 0.75%, by far its highest since the official end of the Great Recession in 2009. However, Gertjan Vlieghe, a member of the Bank’s rate-setting monetary policy committee, recently announced that “in the case of a no-deal scenario I judge that an easing or an extended pause in monetary policy is more likely to be the appropriate policy response than a tightening”. Money markets seem to be even more unambiguous in their expectations, predicting no possibility of a rise in interest rates until at least May 2020.

The story coming out of the Federal Reserve has been much the same. Thanks to the relatively strong recovery in the US economy over the past two years, the Fed has been able to raise interest rates much more quickly than central banks in most other countries. After three rate hikes in 2017 and another four in 2018, the Fed Funds Rate now sits at 2.5%, up from the effective zero rate of 0.25% it maintained between 2008-2015. However, the confidence at the Fed which has allowed this welcome trend seems now to be quaking, due to a range of factors including both Brexit and the Chinese economic slowdown. Fed Chairman Jerome Powell recently made his strongest statement yet against continuing the process of interest rate normalization, arguing that “the case for raising rates has weakened”, and revealing that the Federal Open Market Committee had agreed to take a “patient” approach to future rate hikes. Although the Fed had previously indicated the likelihood of two more rate hikes in 2019, futures markets have reacted to Powell’s speech by predicting no further tightening, and even a slight chance of another fall in interest rates over the next year.

The European Central Bank has, predictably enough, reacted to the threat of a no-deal Brexit by calling forincreased integration of EU capital markets and further “deepening” of the Economic and Monetary Union and the Single Market “beyond its financial dimension”. They have also called for their “macroprudential toolkit to be expanded to address potential risks around … liquidity”, i.e. for greater powers to create new money and inject it into the financial system. Consequently, markets have slashed back their previous bets on an upcoming ECB rates hike, and there has even been speculation that the ECB might start a new round of stimulus spending via cheap bank loans.

Japan has also recently signalled that it may begin injecting more stimulus, while Australia and Sweden have indicated that they might rethink their previous plans to raise rates in the coming months.

Having lived through the past decade of artificially low interest rates and monetary expansion by central banks, it hardly comes as a surprise that those same policies should be resorted to in response to the prospect of a no-deal Brexit. Indeed, it would be easy to simply shrug ones shoulders and attribute these announcements to nothing more than the fact that, as the famous Mark Twain quote goes, when all you have is a hammer, everything begins to look like a nail.

However, as reflexive and blindly pragmatic as these policy responses may sometimes seem, it is important to remember that they are built on their own intellectual foundation in mainstream economic theory, and therefore cannot be effectively tackled other than on that same level of ideas.

The problem with central banks’ repeated recourse to easy monetary policy is not, fundamentally, that it’s the same solution they always seem to point to in times of crisis. The problem with that policy is that it systematically underestimates and overlooks the damages which result from the financial system’s inflation of the money supply through the creation of fiduciary media, usually enabled and coordinated by central banks. This sort of artificial inflation of the money supply not only diminishes the purchasing power of the currency over time, it also results in a redistribution of purchasing power from ordinary citizens to those close to the financial system and the state. Perhaps most importantly, central banks’ insistence on maintaining artificially low interest rates has been shown, by the Austrian Business Cycle Theory of Ludwig von Mises, to be the key cause of cyclical economic crises.

Only through widespread education in these ideas of sound, Austrian economics, will it be possible to shift the monetary orthodoxy away from its present preference for artificially low interest rates, and perhaps eventually disrupt the current, seemingly perpetual cycle of crises and inflationism.

via ZeroHedge News https://ift.tt/2EnFT98 Tyler Durden

As great as digitalization has been for the world, it does of course have its downsides.

But, as Statista’s Niall McCarthy notes, the problem of e-waste is one of the more measurable ones. While smartphones have replaced a long list of electronic devices like MP3 players and digital cameras, that advantage is being cancelled out by a larger volume of digital devices being used by individuals, businesses and governments as well as the rate at which those devices are being replaced.

E-waste is still increasing over time, both in absolute numbers and per capita. In 2016, for example, 44.7 million metric tonnes of refrigerators, televisions, washing machines and other forms of electronic garbage was generated around the world and only 20 percent of it was recycled.

Even though China and the U.S. generate the most e-waste annually in absolute terms, the story is very different on a per capita level.

According to data from the Global E-Waste Monitor cited in a recent OECD report, Norway is on top of the global e-waste mountain when it comes to volume generated per inhabitant.

You will find more infographics at Statista

In 2017, the average Norwegian generated 28.6 kg of e-waste while the UK wasn’t far behind with 24.9 kg. The U.S. has 19.4 kg. Unsurprisingly, generation rates per person are far lower in developing countries where penetration levels of electronic devices and household appliances are not as high.

via ZeroHedge News https://ift.tt/2IKyK8f Tyler Durden

Authored by Tom Luongo,

Given the trajectory of President Trump’s foreign policy since last year there was little hope of significant movement at this year’s summit with North Korea.

Since that first, historic meeting last year in Singapore, Trump’s foreign policy team has become the exact opposite of what that meeting symbolized.

Belligerent, threatening, cocky, obnoxious and ignorant only partially cover the depths to which Mike Pompeo, John Bolton and Trump himself have taken U.S. diplomacy.

There are many who still think that Trump is working for peace in the world. But, even if he is, the reality is that he’s not in charge of anything anymore.

So the point is moot.

Since Trump announced the withdrawal from Syria in December 20th, he has been pushed further and further to the sidelines of his own administration.

Take two weeks ago in Europe for example. Two major international summits are held in Warsaw and Munich and Trump is at home tweeting about the evils of Socialism and Venezuela while the Triumverate of Evil – Bolton, Pence and Pompeo — failed to rally support for a world war against Iran.

Vice President Mike Pence is running the operation on Nicolas Maduro in Venezuela. Trump isn’t allowed anywhere near where the grown-ups are allowed to be.

It makes sense Trump wanted to go to Hanoi to achieve something substantial as was Kim but that was derailed in the end when John Bolton showed up and demanded chemical weapons be added at the last minute.

Former SK unification minister Chong Se-hyun suggests that summit was derailed by last minute attendance of Bolton, who added demands for NK to also report chemical/biological weapons, in response to which NKs increased their demand for sanctions relief https://t.co/d7IbkNtqxi

— Kevin Gray (@DrKevinGray) February 28, 2019

This was confirmed by the North Korean Foreign Minister Ri Yong-Ho at a brief press conference. From RT:

In exchange for partial lifting of sanctions by the US, North Korea would permanently remove plutonium and uranium processing facilities and Yongbyon, in the presence of US experts, Ri said, adding that the “US was not ready to accept our proposal.”

The North Korean official said Washington demanded “one more” measure beyond dismantling Yongbyon, which went too far for Pyongyang.

North Korea also offered written assurances of permanently desisting from nuclear and long-range missile testing.

Now, Trump sells this failure as a step forward. It’s dutifully lapped up by his base, while the power elite in the West breathe a sigh of relief that peace had been averted one more time.

This is a story that is getting harder and harder to write, frankly.

Trump starts out ready to do this thing that will change the course of history and then John Bolton tells him to sit down.

And he does.

Lather. Rinse. Repeat.

How sad is it that during the first day of the Hanoi Hilton Trump is meeting with Kim, Trump’s chief negotiator with China is throwing him under the bus in his testimony before Congress?

And then to undercut Trump more Bolton shows up and scuttles the whole thing quicker than you can say ‘toxic mustache.’

In the end Bolton knows that this process with Korea ends with U.S. troops leaving the peninsula along with all of our nuclear weapons. And that once it starts there is little to stop it from going all the way.

So it can’t be allowed to start.

But the reality is that the Koreas are the ones ultimately in control of this process. All John Bolton can do is slow it down, which he will.

Meanwhile Trump will continue to sell us on the idea he’s still President and everyone goes on pretending nothing has changed.

*  *  *

Please support the production of independent and alternative political and financial commentary by joining my Patreon and subscribing to the Gold Goats ‘n Guns Investment Newsletter for just $12/month.

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

Authored by Juan Cole via TruthDig.com,

The House of Representatives’ Committee on Oversight and Reform has issued a report on a plot to make billions of dollars by selling Saudi Arabia sensitive American nuclear technology that could allow the Kingdom to develop nuclear weapons. The scheme required breaking US law, which forbids technology transfers that might allow nuclear proliferation.

The plot was pushed by a “company” formed for this express purpose called IP3 International, which doesn’t seem to have actually existed except as a sort of shell for lobbying the Trump administration. IP3 was, according to the committee, helmed by “General Keith Alexander, General Jack Keane, Mr. Bud McFarlane, and Rear Admiral Michael Hewitt, as well as the chief executives of six companies— Exelon Corporation, Toshiba America Energy Systems, Bechtel Corporation, Centrus Energy Corporation, GE Energy Infra structure, and Siemens USA—“ All “signed a letter to Deputy Crown Prince Mohammed bin Salman. The letter presented ‘the Iron Bridge Program as a 21st Century Marshall Plan for the Middle East.’”

Bud McFarlane? That is Ronald Reagan’s National Security Advisor who was up to his elbows selling arms to Khomeini in the Iran-Contra scandal, and thought up the idea of sending Ayatollah Khomeini a cake shaped like a key and a Bible (along with a few T.O.W. anti-tank emplacements)! Like Elliot Abrams, he was pardoned by George H. W. Bush, who seems to have created a factory for 21st century further scandals.

The point man for the plot was General Mike Flynn, who called for Hillary Clinton to be locked up at the Republican National Conference in late summer of 2016 and glommed on to Trump, becoming his first National Security Adviser. Flynn had visited Saudi Arabia in connection with the IP3 plot to transfer nuclear technology to that country that could help Riyadh make a bomb if the royal family felt they needed to do so to remain safe (e.g. if Iran went in that direction or if relations with nuclear-armed Israel tanked). The cover story was that the US corporate front would just make 6 nuclear reactors for electricity generation.

Derek Harvey, the Senior Director for Middle East and North African Affairs at the National Security Council in the first half of 2017, is alleged to have adopted the IP3 plot as US policy, dubbing it the “Middle Eastern Marshall Plan.” Mr. Harvey seems confused. The Marshall Plan was an aid program where the US gave out hundreds of millions of dollars to poor societies after WW II to promote prosperity and fight Communism. It wasn’t a money-making scheme whereby we would sell nuclear weapons technology to an absolute monarchy that uses bone saws on journalists in return for vastly enriching private individuals and a handful of corporations.

Remember, all these retired generals and CEOs and Republican bigwigs were calling for Iran to be bombed back to the stone age on the pretext that it had a civilian nuclear enrichment program that was potentially dual use and could maybe someday perhaps lead to an Iranian Bomb (the Iranians never decided to go in that direction and in 2015 mothballed 80% of their program). Apparently what the US economic elite really minded was not so much possible Iranian proliferation but that they would not get a few billion dollars as a payday for being the ones to supply the technology.

IP3 was not in a position to do an end run around the Atomic Energy Act, the law preventing an administration from handing over top nuclear secrets to another country without congressional approval. But the National Security Council could be a vehicle for secretly making such a deal.

The Congressional report says that the IP3 plot was closed down at one point but that NSC whistleblowers are afraid that some Trump administration personnel in the NSC and elsewhere may still be working on the illegal technology transfer.

Note that it might actually have been possible for Trump to get the scheme through the Republican House and Senate before last November but that the current legislators are unlikely to want to sell Saudi Arabia nuclear-bomb-making technology.

Trump’s son-in-law, Jared Kushner, appears to have picked up the scheme once Flynn was fired for having lied to the FBI over his contacts late in 2016 with the Russian ambassador Sergey Kislyak. The committee report says that whistleblowers allege that in March, 2017, a meeting was held…

“Also present was a career NSC staffer who later informed colleagues that Mr. Harvey was again trying to promote the IP 3 plan “so that Jared Kushner can present it to the President for approval.”

For all we know, the plan to give the Saudis a nuke is still in play, with hundreds of billions of dollars at stake. This scheme is the ultimate in criminality, where US government resources (remember the Manhattan project?) are given away to another government by the white collar criminals now running the US government so that they can scoop up private massive fortunes rivaling those of the richest persons in the world such as Jeff Bezos and Bill Gates.

One thing you may be assured of is that Iran is going through this Congressional report with a fine-tooth comb. If there is one thing that really could crash the 2015 Iranian non-proliferation nuclear deal, it is the prospect of a Saudi Bomb. That people would try to destroy that deal on the one hand and slip Riyadh world-destroying secrets for personal enrichment boggles the mind.

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

Dangerous cracks developing across Antarctica’s Brunt Ice Shelf are due to unleash a massive iceberg twice the size of New York City, according to NASA researchers who warn when it breaks, it could destabilize the entire shelf.

NASA recently released images acquired by Landsat satellites of Antarctica’s Brunt Ice Shelf, where a rift is visibly slicing through the shelf. Researchers said the crack had been stable for more than three decades, but since, has been moving north at about 2.5 miles per year.

“The near-term future of Brunt Ice Shelf likely depends on where the existing rifts merge relative to the McDonald Ice Rumples,” said Joe MacGregor, a glaciologist at NASA’s Goddard Space Flight Center. “If they merge upstream (south) of the McDonald Ice Rumples, then it’s possible that the ice shelf will be destabilized.”

The rift is moving toward another fissure, as known as Halloween crack, that is located 3 miles away. Halloween crack was first discovered in 2016, continues to move east, and when the two rifts intersect in the very near term, an iceberg is formed measuring 660 square miles.

“We don’t have a clear picture of what drives the shelf’s periods of advance and retreat through calving,” said NASA/UMBC glaciologist Chris Shuman.

“The likely future loss of the ice on the other side of the Halloween Crack suggests that more instability is possible.”

Researchers are puzzled on what drives this process, known as calving, could mean the health of the shelf is in immediate danger.

“At worst, this calving could destabilize the remainder of the Brunt Ice Shelf leading to its complete collapse,” Dominic Hodgson, a senior scientist at the British Antarctic Survey, told NBC News Tuesday in an email.

“This would then likely be followed by an acceleration of ice in the upstream glaciers, increasing their contribution to sea level.”

Calving is a natural part of the life cycle of ice shelves, but recent rifts forming in the region are unusual. The edge of the Brunt Ice Shelf has evolved since Ernest Shackleton surveyed the coast in 1915, but in the last several years, the speed of its transformation has been accelerated.

The risk of the 660 square mile shelf breaking off has prompted safety concerns for researchers working in the area, particularly researchers at the British Antarctic Survey’s Halley Station, a major base for Earth, atmospheric, and space science research typically operates year-round, but has recently closed operations due to unpredictable changes in the ice.

If the converging cracks destabilize the ice shelf even further, a massive iceberg twice the size of New York City could soon be soon floating in the South Atlantic Ocean.

via ZeroHedge News https://ift.tt/2Ta070v Tyler Durden

Submitted by SouthFront.org

A Russian defense contractor, Kalashnikov Concern, named after one of the most famous small-arms designers of all time, is now producing kamikaze drones designed to destroy remote ground targets.

The “high-precision unmanned aerial system” KUB-BLA was for the first time showcased at the International Exhibition of Arms and Military Equipment 2019 in Abu Dhabi. The drone delivers an explosive charge on the coordinates of the target, which are set manually or can be acquired automatically by uploading image of the target into the guidance system.

The KUB-BLA has a 3-kilogram payload, a flying time of 30 minutes, and a 80-130-kilometer-per-hour speed. It measures 1210mm wide by 950mm long and 165mm high. Typically, the payload is apparently a high-explosive charge. Kalashnikov Concern says that the advantages of the system are “hidden launch, high accuracy of the shot, noiselessness and ease of handling”.

Furthermore, it seems that the KUB-BLA has already been battle-tested in Syria.

On October 19, 2015, a swarm of five mysterious suicide drones attacked a military position of the Ahrar al-Sham Movement near the town of Maar Shamarin in the Syrian province of Idlib. A few hours after the attack, the local SMART News Agency interviewed the fighters who survived the attack. They all seemed to be shocked and terrified by the “Wunderwaffe” that killed one of their comrades and destroyed most of their equipment.

Back then, nobody was able to identify these drones. Some sources suggested that these were the ZALA 421-16E. However, this drone has no offensive capabilities and the vestiges of the employed suicide UAVs showed little match with its design.

In turn, the design of the KUB-BLA appeared to be similar, even in small details, to the mysterious suicide drones, which hit the Ahrar al-Sham position. Another factor is the location of the attack. Maar Shamarin is 27km north of Morek, the stronghold of Syrian government forces back in 2015. Taking into account the declared characteristics of the KUB-BLA, the kamikaze drone should be capable of hitting  targets in the range of about 40km. This range was more than enough to reach the Ahrar al-Sham position even if the drone was launched from the area behind the frontline.

This was not the first time when the Russians Defense Ministry used Syria as a test-ground for its modern weapons and equipment. According to official data, Russia tested over 300 types of weapons and equipment, including the Su-57 fifth generation fighter jet, the Uran-9 unmanned combat ground vehicle and the Terminator-2 armored fighting vehicle, in Syrian since the start of its anti-terrorist operation in the war-torn county in 2015. However, the October 19 event is the first case ever when it is reasonable to assume with a high probability that the Russian side employed an attack drone of any kind during the conflict.

via ZeroHedge News https://ift.tt/2Uf0of8 Tyler Durden

Meet Dr. Herbert Wertheim, a South Florida optometrist and small businessman who in several decades, became a billionaire.

Wertheim, 79, is a self-made billionaire worth $2.3 billion, according to Forbes‘ The World’s Billionaires list. His fortune comes from numerous inventions and buy-and-hold investing.

Wertheim could very well be the most significant individual investor many Americans have never heard of, and he recently sat down with Forbes to prove it.

Madeline Berg, a reporter at Forbes following the money, flipped through Wertheim’s brokerage statements which showed hundreds of millions of dollars in tech stocks like Apple and Microsoft, purchased long ago at their IPOs. There are dozens of other blue-chip stocks in the portfolio, ranging from GE, Google, BP, and Bank of America.

Here is Wertheim’s interesting path into becoming a billionaire.

In the early 1960s, he attended the Southern College of Optometry and after graduation started a small practice in South Florida. At nights, Wertheim spent his time tinkering on inventions, and in 1969, he invented an eyeglass tint for plastic lenses that filtered dangerous UV rays, helping to prevent cataracts.

Demand for Wertheim’s tint erupted, and he sold the royalty for $22,000. However, because of contractual breaches, he never collected any royalty funds from the deal.

So in 1970, Wertheim formed a new company, Brain Power Inc. (BPI). He established the company as a technology consulting firm, but at the same time, he reverted to developing tints, dyes and other technologies for eyewear.

A year later he invented the world’s first neutralizers, a chemical that restored lenses to their original state. At the time, he showed his wife a can containing the new chemical and said, ‘Nicole, what’s in this can is going to make us millionaires.’ ”

Between the tints, dyes, and neutralizers, Wertheim rolled the new technology into BPI, which became one of the world’s largest manufacturers of optical tints, selling products to companies like Bausch & Lomb, Zeiss and Polaroid.

Forbes said BPI “never achieved hypergrowth,” but it allowed Wertheim more freedom to pursue a life of investing.

Similar to Warren Buffett, Wertheim believes in doubling down when he feels passionate about companies.

“If you like something at $13 a share, you should like it at $12, $11 or $10 a share,” Wertheim says. “If a stock continues to go down, and you believe in it and did your research, then you buy more. You are actually getting a better deal.” Whenever possible, he adds, dividends are useful in cushioning the pain of stocks that drift down or go sideways.

Wertheim tells Berg he bought Microsoft at its IPO in 1986. “I knew a lot about computers and had been involved in building them,” he says. BPI used Apple IIe’s, but after Microsoft released its Windows operating system in 1985, Wertheim fell in love with the company. “Only Microsoft had an operating system that could compete with Apple,” he recalls.

The Microsoft shares he owns, which has been paying him a sizeable dividend since 2003, are now worth more than $160 million.

He also owns 1.25 million shares of Apple, mostly purchased during its 1980 IPO and also at $10 in the 1990s, are worth $195 million.

“My goal is to buy and almost never sell,” he says, parroting a Buffettism.

“I let it appreciate as much as it can and use the dividends to move forward.” In this way Wertheim, like the Oracle of Omaha, seldom reinvests dividends but instead uses the cash flow from his portfolio to either fund his lifestyle or make new investments.

Wertheim’s billionaire status is not just a result of his buy-and-hold strategy, but it was his ability to buy the right stocks at the right time – during the start of four decades of easy money from the Federal Reserve.

Given that equity valuations are at levels never witnessed in the modern era, the return profile for the stock market in the next decade is rather scary: “A run-of-the-mill completion of this cycle will be a -60% loss in the S&P 500, erasing its entire total return vs T-bills since roughly 1998. What will shape that trajectory over shorter periods, but not ultimately, is the condition of market internals,” said John Hussman of Hussman Funds.

With that being said, maybe buy-and-hold investing has peaked, and a return to actively-managed portfolios is the next trend.

via ZeroHedge News https://ift.tt/2IMgk7c Tyler Durden