Signs are going up in London telling people not to sh*t in the streets.
A City of Westminster Clean Streets sign posted to Twitter reads, “This area is being monitored for street fouling. Anyone urinating or defecating may be subject to arrest.”
“Welcome to London. Do not shit in the street,” tweeted Old Holborn.
Public defecation used to be more of a problem in non-European countries, but it seems to have made its way here now.
The sight of feces in the streets is becoming a major problem in liberal utopias like San Francisco, and it seems it’s London’s turn for a taste of that brand of progressivism.
This seems like an appropriate place to embed the following video.
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via ZeroHedge News https://ift.tt/31fKIeD Tyler Durden
Less than two months after roughly $1.3 billion worth of cocaine (18,000 kilos) was seized from the MSC Gayane container ship at a Philadelphia port on June 17 after stops in the entire drug belt including Colombia, Chile, Peru, Panama and the Bahamas – with the subsequent news that the ship belonged to JPMorgan not exactly shocking too many people – on Friday in a remarkable one-two punch, German law enforcement officials did their best to put JPMorgan out of the cocaine distribution trade for good (just kidding, just kidding), after Germany double down with the country’s biggest cocaine bust in history as well.
“Assuming that this likely high-purity cocaine can be cut to triple the amount for street sale, the 4.5 tonnes has a street value of approximately €1 billion,” said the Hamburg customs department on the matter. That’s over a billion US dollars, and just shy of the record haul captured in Philadelphia 6 weeks earlier.
The drugs – sent from Montevideo, Uruguay, and hidden in 211 black sports bags that had been packed inside a shipping container – were uncovered during a routine shipment check and labeled as soybeans, which perhaps may explain the recent surge in “soybean” trade and which has nothing to do with circumventing Chinese tarfiffs on US imports. The druges were
An undated handout picture provided by Hamburg main customs office on August 2, 2019 shows packets of pressed cocaine in Hamburg, Germany
Stuffing the cocaine in sports bags is hardly the most creative way the drug has been smuggled into Europe recently. In July, a man was discovered in a Barcelona airport with 1.1 pounds of cocaine tucked under a terribly-fitting toupee.
Agency officials now say that the contraband has been destroyed “amid strict secrecy and extensive security precautions,” and that officials are now concerned with investigating the intended recipients of the container in Antwerp, Belgium.
Fingers have been pointed when it comes to where the illegal drugs are being passed through. In addition to the Hamburg bust, a plane that arrived in Switzerland with a half ton of cocaine points to Uruguay’s role as a transit point for the narcotics. A month-long report completed by CNN also points to Venezuela’s position as a smuggling point for drugs destined for the United States. That report suggested that much of the drugs were being produced in Colombia’s Vichada region, which is located close to the country’s long border with Venezuela. In that area, coca agriculture provides some of the only economically viable jobs for residents. A UK Guardian investigation from June explored the ways that the US’ tighter border security was resulting in an uptick of cocaine exports to destination countries in the eastern hemisphere.
A spokesperson for the Hamburg customs investigations office said that the high amounts of drugs that agents in the port have discovered are a source of pride for officials. Nonetheless, he estimated that only a quarter of illegal drugs sent to Germany from South America are discovered, which would put the total of cocaine arriving yearly to the port at 30 tons.
And while JPMorgan almost certainly had nothing to do with the two consecutive busts (one hopes), the size of the haul means that South American drug cartels are getting ballsier about the quantity of controlled substances they’re smuggling to ports in the region, according to the aptly named “High Times.” Either that, or they are simply getting sloppier. Of course, the double loss of over $1 billion in drugs will result in some serious turmoil in even the most financially padded drug organization so one may, for example, expect even more homicides in Mexico where 2019 is on pace to become the most murderous year in history as a result of an unprecedented surge in shootouts between rival narco organizations.
To be sure, in addition to the record Philadelphia June 17 haul, there has been a surge in intercepted drug shipments this year with the US Coast Guard announcing that it has confiscated $569 million worth of cocaine since May—17,000 pounds of which were discovered in a June 18 video that showed officers in hot pursuit of a semi-submarine.
Thieves stole all four tires from Karen and Dan Dow’s car, leaving it propped on milk crates outside their San Francisco home. As soon as they discovered the problem, Karen called for a tow truck. But while she was on the phone, parking enforcement left a $79 ticket on the car for being parked on the street during sweeping. After local media picked up the story, the city rescinded the ticket.
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Thieves stole all four tires from Karen and Dan Dow’s car, leaving it propped on milk crates outside their San Francisco home. As soon as they discovered the problem, Karen called for a tow truck. But while she was on the phone, parking enforcement left a $79 ticket on the car for being parked on the street during sweeping. After local media picked up the story, the city rescinded the ticket.
from Latest – Reason.com https://ift.tt/2MK317s
via IFTTT
There is a changing of the guard at the European Central Bank this year with two important new appointments.
Philip Lane, the governor of the Irish central bank, was appointed chief economist of the ECB back in June. And and the current head of the IMF, Christine Lagarde, was recently nominated to succeed Mario Draghi as president of the ECB in November. By all accounts, she is a shoo-in: she is the ultimate insider, having served as French minister of finance before becoming director of the IMF, and she has cultivated excellent relations with the main players in European politics. She’s a favorite of the French and the Germans, seemingly well-liked by many of the smaller European governments. Even Yanis Varoufakis, the former finance minister of Greece who clashed with her over so-called austerity for Greece, testifies to great admiration for the future president of the ECB.
Since we can expect Ms. Lagarde to be appointed with a minimum of opposition, the question arises: what does this mean for future European monetary policy? The announcement of her appointment was greeted with euphoria on financial markets, as it is believed that the ECB will turn even more dovish under her leadership. There can be little doubt that she will follow in the footsteps of her immediate predecessor and “do whatever it takes” to keep the ECB going and European financial markets — and governments — afloat. Nor is there any doubt that she possesses the skill-set to navigate the institutional and international politics required of her new job, as a recent article in the Wall Street Journalmakes clear. This does not answer the key question, however. Even the most mundane technocrat is always guided by an ideology, a worldview or set of ideas that shape how she thinks about what is possible and what is not. What we really need to know is: what ideas will guide Ms. Lagarde when she becomes chief of the ECB in November?
Her own background offers little clue, beyond the fact that she is obviously aligned with the mainstream of European politics. But she is a centrist through and through, ready to cover for corruption and shady dealingswhen finance minister in France. And as head of the IMF, she played a key role in helping the German creditors secure their loans to the Greek government.
The Push for Digital Cash
More evidence about the trend of Ms. Lagarde’s thinking about monetary policy can be gleaned from the research of the scholars who worked under her at the IMF, and the ideas she publicly endorsed as director of the Fund. Consider for instance the speech she gave in November of 2018 at the Singapore Fintech Festival. Here she advocated for the issuance of digital cash by central banks. The ostensible reasons she gave for this innovation are pretty absurd if one considers them for more than five seconds. For example, who can really take seriously Lagarde’s claim digital cash will enhance privacy if the central bank issues digital currency? We are told the details of how we use the central-bank’s digital cash will only be revealed to the state if required by law, or if the transactions in question seem suspicious. In other words, the veil of anonymity that can be lifted whenever the state decrees it. That’s not exactly a great privacy-protection scheme.
The underlying reason that central banks might wish to enforce some sort of digital currency emerges if we consider the IMF publication Ms. Lagarde cites in her speech. Authored by a bevy of IMF economists, “Casting Light on Central Bank Digital Currencies” is a long, boring document detailing the pros and cons of digital cash. It emerges in the report that the crucial issue for a central bank when considering digital cash is the ability to lower interest rates when faced with an economic crisis. Digital cash is one way to overcome the zero lower bound and push interest rates into negative territory. The IMF is a long-standing advocate of this position, bothon its blog and in working papers authored and published under its auspices with titles such as “Enabling Deep Negative Interest Rates to Fight Recessions” and “Breaking Through the Zero Lower Bound.”
The necessity of negative interest rates in expanding central-bank powers is the conclusion that mainstream monetary economics inevitably leads to. We have already seen it advocated in the US by erstwhile Fed nominee Marvin Goodfriend and most recently by Michael Bordo and Andrew Levin in the Cato Journal. When manipulating interest rates is seen as a key tool in dealing with recessions, you inevitably end up having problems when the interest rate is close to zero. We should therefore not be surprised that scholarship dealing with ways to overcome the zero lower bound has flourished at the IMF under Ms. Lagarde’s direction, nor that she may import these ideas into the ECB — to the extent that they are not already there.
Dr. Lane and the Push For Europe-Wide Sovereign Bonds
This brings us back to the new chief economist, Philip R. Lane, whom Ms. Lagarde is expected to rely heavily on. A highly-regarded economist, Dr. Lane holds the prestigious Whatley chair at Trinity College in Dublin, is educated at Harvard like so many of the high wizards of mainstream monetary thinking. He is widely regarded as a dove and credited with reflating the Irish property bubble when governor of the Central Bank of Ireland.
The real radicalism of Dr. Lane is not his penchant for easy money, however. That comes with the territory as a central bank official in the European Union. The radical innovation we can expect him to advocate is the creation of new Europe-wide sovereign bonds, or sovereign bond-backed securities (SBBS),as he calls them. The reasoning behind introducing these bonds is that European banks hold large amounts of domestic sovereign debt, inhibiting the creation of a common market for banking services and making the banks dependent on their governments for stability and profit.
SBBS is not a new idea Dr. Lane came up with, but something that has been in the works for some years now. The scheme is meant to work as follows: a new EU entity, or perhaps the ECB itself, issues new bonds backed by the sovereign bonds of the governments in the EU. These new bonds can then be divided into senior, mezzanine, and junior tranches, depending on the risks of default associated with them. The senior tranche would be protected from default by the mezzanine and junior tranches, and could be used to replace sovereign debt in the banks’ balance sheets, weaning them from dependence on government debt.
There are several issues with this proposal. First of all, if there were a demand for this kind of rehypothecation of government debt, financial markets would willingly supply it. Second and crucially, SBBS will not wean banks from government debt. On the contrary, instead of domestic governments, banks will become dependent on the centralized financial policies of the EU and ECB. Should SBBS replace domestic government bonds, it will lead to the harmonization of the balance-sheets of all banks across the EU, making European banks vulnerable to shocks originating anywhere in the union. It will also mean a further concentration of power in the financial and political institutions of the EU, making it easier for the ECB to manipulate interest rates and pump money into the economy, in pursuit of the mythical “desirable” level of inflation.
Conclusion
We can expect the ECB to continue down the road of easy money and ever-increasing central control over money and finance that is has already set out upon. While there may be some push-back from national governments resisting further erosion of their sovereignty, this is clearly the development indicated by the monetary thinking at the center of the Lagarde-Lane regime. These are not revolutionary or heterodox ideas, but the logical conclusion of mainstream monetary thought. Since this thought amounts to little more than a sophisticated inflationism, we should not expect provident policy and financial normalcy to return to Europe any time soon. Mises’s verdict is as true of the present rulers of the EU as of the governments of his own time:
All governments are firmly committed to the policy of low interest rates, credit expansion, and inflation. When the unavoidable aftermath of these short-term policies appears, they know only of one remedy — to go on in inflationary ventures.
With Ms. Lagarde and Dr. Lane at the ECB, the European elites are sure to get as much inflation and government intervention in money and finance as they could possibly want. The European workers and consumers will be left facing the disastrous consequences of yet another round of easy money.
via ZeroHedge News https://ift.tt/2Kq2JQF Tyler Durden
In a stunning development for German politics, Germany’s anti-immigrant, nationalist party Alternative for Germany, or AfD, has taken the lead in the east of the country ahead of Chancellor Angela Merkel’s Christian Democrats (CDU), just a month before regional elections in the eastern states of Saxony and Brandenburg, an opinion poll showed on Sunday.
The AfD is currently polling at 23%, ahead of Angela Merkel’s Christian Democratic Union, or CDU, which is at 22%, according to a poll carried out by Bild. The far-left Die Linke is in third place at 14% while the Greens are at 13% and the center-left Social Democrats (SPD) on 11%.
The eastern states of Brandenburg and Saxony hold regional elections on Sept. 1, followed by Thuringia a month later.
As shown in the map below, the AfD has taken a leadership position in Germany’s formerly communist, and more economically backward eastern states. The good news for Europe’s establishment is that in the west of the country, the AfD remains further back, and last polled in fourth position at 12%, with the CDU at 27%, the Greens 25% and SPD 13% in the Kantar Emnid poll of 1,419 conducted from July 25-31.
The AfD barged on the scene in 2017, when it entered Germany’s national parliament for the first time as the third largest party, helped by voter anger at Merkel’s decision to welcome asylum seekers from the Middle East and Africa.
As Reuters notes, an inevitable defeat for the SPD in Brandenburg, where it has won all of the last six elections there since German reunification in 1990, and the CDU in Saxony would put more pressure on the coalition partners to rethink their alliance in national government, while further derailing the German political establishment.
As Bloomberg adds, the former communist east that saw massive right-wing protests last year is now back in focus as voters in three states go to the polls this fall. In Saxony and Brandenburg, Merkel’s Christian Democrats and their junior partner, the Social Democrats, are set to lose for the first time since reunification in 1990 to the upstart AfD.
That could not only implode her fragile coalition but upend a political landscape dominated by two parties since World War II.
While the AfD looks set to sweep in the East, it still has a ways to go at the national level, with the poll showing the AfD up one percentage point at 14%, the SPD down a point at just 13%, the CDU steady at 26%, the Greens on 23%, the Free Democrats on 9% and the Linke on 8%.
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Before Fukushima and Chernobyl, the worst-ever nuclear disaster was a massive leak from a plant in the eastern Urals.RT went to see how people live in areas affected by the fallout from the USSR’s risky rush to the nuclear bomb.
Chernobyl and Fukushima are the two names that are most likely to come to mind when one thinks about nuclear disaster, and rightfully so. People in the US will likely recall the Three Mile Island accident, while Britons may say the “Windscale fire.”
The name “Kyshtym” will probably mean nothing to the wider public, despite it belonging to the third-worst nuclear accident in history. An RT Russian correspondent traveled to the area to speak with locals, some of whom personally witnessed the 1957 disaster, to find out what living in such a place feels like.
Bomb at any cost
Kyshtym is the name of a small town in what is now Chelyabinsk Region in Russia, located in an area dotted by dozens of small lakes. A 15-minute car ride east will bring you to another town called Ozyorsk. Six decades ago, you wouldn’t find it on any publicly available map because it hosted a crucial element of the Soviet Union’s nascent nuclear weapons program, the Mayak plant.
The Soviet leadership considered building up a stockpile of weapons-grade plutonium to be a high priority, while environmental and safety concerns came as an afterthought. Some of the less-dangerous radioactive waste from Mayak was simply dumped into the Techa River, while the more-dangerous materials were stored in massive underground tanks.
Prisoner labor was used in construction of the Mayak facility in the 1940s. Archive photo from Mayak website (po-mayak.ru)
The sealed steel containers, reinforced with meter-thick concrete outer walls, were considered strong enough to withstand pretty much anything. In September 1957 this assumption was proven wrong, when one of the tanks exploded with an estimated power of 70-100 tons of TNT. This happened due to an unrepaired cooling system, which allowed radioactive waste to build heat and partially dry up, forming a layer of explosives, an investigation later found. An accidental spark was then enough to blow off the 160-ton lid of the tank, damage nearby waste storages, and shatter every window pane within a 3km radius.
A plume of radioactive waste was ejected high into the air. Some 90 percent of the material fell right back, contaminating the area and adding to the pollution in the Techa River, but some was atomized and traveled northeast with the wind. A 300km long, 10km wide stretch of land running through three Russian regions is what’s left by the fallout. The worst-affected part of it was designated a natural reserve a few years after the disaster.
Cover up
The disaster was covered up in the Soviet media, which reported that the strange lights in the night sky – actually a glow caused by ionization from radioactive waste – was a rare event related to the aurora. The locals knew something was wrong, of course, due to the evacuation of two dozen nearby villages and the large-scale decontamination work that was to be carried out over the next several years.
“My father and many locals were mobilized for the liquidation effort,” Lyudmila Morozova, a survivor of the disaster, told RT.
“They plowed all land half a meter deep. In the evenings, Father’s friends would come to our home to wash in the banya.”
Later, the military came to get radiation readings in it. Afterwards, soldiers demolished the banya and took away not only the house but even the layer of soil on which it was built.
Officially, the scale of the disaster remained a state secret until the late 1980s.
Poisoned river
The Techa River remains contaminated now, long after Mayak stopped dumping waste in it. The radiation is relatively low, however: standing next to it is no worse than traveling on an airplane. Thousands of people cross it every day via a bridge road that connects Chelyabinsk and Ekaterinburg – the two nearest provincial capitals.
The only inhabited village down the river is called Brodokalmak and is about 85km downstream from Ozyorsk, and 50km away from the bridge crossing. Locals are well aware of the river’s waste-dumping past, but it doesn’t stop them from fishing.
“I’m not catching the fish for myself, it’s for the pet,” said Aleksey Morozov, who told RT that he spent his entire life in the village.
“We didn’t have any two-headed kittens so far. The toxins accumulate in the bones, so all you need to do is dispose of fish bones,” he explained.
A dosimeter that RT crew brought for the trip shows he is right. His catch is only slightly more radioactive than regular background radiation. The readings under the bridge were 35 times higher. The radioactive isotope, strontium, tends to accumulate in bones, just as Aleksey said. It has mostly gone into sediment on the bottom of the river, and is relatively safe if undisturbed.
Ghost village
Halfway between the bridge and Brodokalmak is another village, Muslyumovo. It was inhabited until about a decade ago, when Rostatom, the Russian nuclear monopoly, offered to relocate its 2,500 residents. Now it’s a ghost village.
Unlike Chernobyl’s Pripyat, Muslyumovo was left orderly over time. Most of the valuables, including entire wooden houses, were taken by owners, but brick walls were left behind. Floors are littered with discarded papers from some business owner’s inventory.
Rostatom officials say the relocation was not really necessary and the company agreed to fund it mostly to quell down public fears. The sentiment against nuclear power is understandably strong in the general area. This was part of the reason that the company decided not to complete a nuclear power station, which was supposed to be built 10km east of Ozyorsk.
Triple exposure
Another place that had a close brush with Mayak’s waste is Metlino, a town about 25 minutes east from Ozyorsk. Some residents were unfortunate enough to have been exposed to radiation three times in their lives, according to Lyudmila Krestinina, who heads a lab at a local radiation research medical center.
First, they lived on the Techa River when it was used to dump waste. Then the disaster happened, and the cloud went past, close enough for some fallout but not close enough for it to become a major risk. The third time happened in 1967.
“There was drought and the Karachay bog, where waste was dumped from the Mayak, caught fire. The wind brought radioactive smoke over Metlino,”she said.
“Now the contamination level has decreased several times, but it’s still higher than background radiation.”
The bog used to be a lake in the early days of Mayak, which started to dry up in the 1960s. The 1967 incident prompted major landscaping work to cover its shallow parts with earth and provide greater water supply. This solution was ultimately deemed unfeasible, so the rest of the lake was covered as well. The work ended just four years ago.
Less carcinogenic than smoking
Metlino’s past exposures don’t dissuade Rosatom’s own specialists from living there. The company is currently developing a new project for its senior staff working at Mayak in the town.
The health impact form the Kyshtym disaster is difficult to put in numbers. Some 80,000 people were potentially affected by the fallout and the wider Mayak activities had been monitored for years. Krestinina, the radiation center specialist, estimates that those exposed were about 2.5 percent more likely to develop some form of cancer, compared to people who didn’t have such an experience.
Andrey Vazhenin, chief oncologist of Chelyabinsk Region, said that today living in the regional capital, a major industry center, is actually more dangerous than on the Techa riverside.
“Radiation is not the worst carcinogenic factor. Smoking and alcohol pose a significantly higher risk,”he told RT.
via ZeroHedge News https://ift.tt/31i0XaS Tyler Durden
As Cold War 2.0 looms between Russia and the US, Moscow upped the ante last week with the announcement of a new next-generation stealth strategic bomber.
TASS News reports the Tupolev PAK DA bomber is being developed for Russia’s Aerospace Force will undergo trials at the Flight Test and Development Center in the city of Zhukovsky outside Moscow next month.
“There are big plans ahead for testing and further developing the heavily upgraded Tu-22M3M, Tu-160 and Tu-95MS aircraft along with large-scale work for testing the prospective complex of long-range aviation [PAK DA],” Tupolev CEO Alexander Konyukhov said during a meeting at the 70th anniversary of the Zhukovsky Test Flight and Development Center.
Head of the Defense and Security Committee in the upper house of Russia’s parliament Viktor Bondarev said the PAK DA stealth bomber is expected to replace Tu-22M3, Tu-95MS, and Tu-160 bombers.
Procurement of the new planes to Russia’s Aerospace Force is expected to start in 2025 through 2030. There is no word on if the bombers will carry hypersonic weapons.
Russia’s announcement of a new stealth bomber comes as new reports from Western media indicate the US Air Force’s next-generation stealth bomber could be operational in the mid-2020s and could fly as early as 2021.
Computed generated images of the Tupolev PAK DA recently surfaced on YouTube account Military Update, shows several minutes of the aircraft’s design.
There are limited details on the test next month at Zhukovsky. Government and Tupolev officials didn’t say if an actual airframe is being tested. Carefully worded statements from the company say the development work is nearing completion and deliveries are expected by 2025.
An earlier announcement said flight tests were expected in 2019.
Konyukhov also the Zhukovsky flight center will be used for development on the medium-haul military transport plane, and also a supersonic passenger jet “jointly with the leading sectoral research institutes and enterprises.”
On Saturday, we reported that the Sukhoi Aircraft Company, part of Russia’s United Aircraft Corporation, has started series production of Su-57 fifth-generation fighter jets and will soon be delivering these planes to the country’s Aerospace Force.
Deputy Prime Minister Yuri Borisov, told TASS last week that production of the stealth jets has started, with expected production ramps through the 2020s.
“A state contract was signed at the Army 2019 international arms exhibition between the Defense Ministry of Russia and the Sukhoi Company for the delivery of a batch of Su-57 fifth-generation fighter jets. The Sukhoi has started to fulfill its contractual obligations,” the vice-premier’s office reported.
The state contract requests the delivery of 76 Su-57s to Russia’s Aerospace Force by 2028.
Russia’s procurement plans of stealth bombers and current acquisitions of stealth fighter jets reflect the military’s modernization effort.
Russia, along with China, is in great power competition with the US. In securing its domestic and foreign interests, Moscow has moved swiftly to overhaul its military capabilities by replacing out-of-date Soviet-era weapons with next-generation weapons. Low oil spot prices and economic sanctions from Washington, however, are impeding President Putin’s task of bringing new weapon systems online on quick notice.
via ZeroHedge News https://ift.tt/2OEkotd Tyler Durden
There may be readers who weren’t even born when the U.S. still had a gold-backed dollar. Since the gold standard was abolished in 1971, the value of the dollar has decreased annually by 3.96 percent. You would need over $600 today to purchase the same goods you purchased for $100 in 1973. Still, a dollar is a dollar, right? No, it is not. It is just a piece of paper.
Is there a chance the U.S. could return to the gold standard and provide real value to the U.S. currency? Judy Shelton and Christopher Waller are President Trump’s pick for Federal Reserve governors. As it happens, Ms. Shelton is a believer in the gold standard and a critic of current Federal Reserve policies. She believes that the Fed has become unnecessarily involved in trade policies instead of adhering to its function of regulating the monetary system. Returning to the gold standard is not a popular idea these days when economists support the limitless printing for currency, high debt, and inflation.
Ms. Shelton would have been considered mainstream 35 years ago. Today, she is thought of as unorthodox. In 2018, she wrote in an article published by the conservative thinktank, Cato Institute,
“If the appeal of cryptocurrencies is their capacity to provide a common currency, and to maintain a uniform value for every issued unit, we need only consult historical experience to ascertain that these same qualities were achieved through the classical international gold standard.”
She also authored a book, Fixing the Dollar Now. In it, she advocates for linking the dollar to a benchmark of value, preferably gold. More than four decades ago, the currency of all major countries, such a Britain, Japan, France, Russia, and others were linked to gold. In 1933, the dollar was linked to $35 worth of gold. In 2019, the value of the dollar is less than one-thirtieth of that.
The gold standard helped the U.S. prosper for 180 years. The signers of the U.S. Constitution included this requirement in Article 10.
No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.
Almost two hundred years later, such a concept is deemed unorthodox. Ideologies change, and not always for the better.
The reason the Founding Fathers included a monetary policy in the Constitution is that they wanted money to be as far away as possible from any human intervention. This was achieved by linking the dollar to gold. Gold is a stable commodity, and thus ensures a stable U.S. currency.
Countries today link their currency to some other, stronger currency, such as the dollar or the euro. This means that these countries have no control over their own currency and are at the mercy of an arbitrary link. But as the dollar and euro weaken, so do the currencies that have linked themselves to it. This serves as a disruption of all global economies.
“Stable money” provides us with logical economic guidelines. Market forces become the determining factor of what is produced and where capital is spent. For example, if the price of oil becomes too high, the consumer will reduce oil consumption while companies will either increase their production of oil or seek other sources. When market forces rule, everyone benefits.
Market forces have largely been replaced by government interference and manipulation. The cost of a loaf of bread is what the government says it will be. (See Venezuela for an extreme example.) To manipulate prices, the government, or the Fed, needs to manipulate the value of the dollar. The loaf of bread purchased a year ago for $2.00 now costs $2.50. Same bread, manipulated price. When market forces rule, the price of a loaf of bread would be determined by consumer choice. Under central banking rules, the price would be manipulated by some artificial whim.
One of the easiest ways to manipulate money is through easy credit. Print unlimited currency with no intrinsic value and you create a mountain of debt. This will inevitably lead to inflation and higher prices. If the dollar were once again linked to gold, only a certain amount of money, backed by gold, could be printed. Debt, inflation and higher prices would almost immediately go into a tailspin. Money cannot be manipulated under the gold standard. Perhaps that is why so many economists fear to return to such a standard.
Judy Shelton will be duly criticized for her opinions. Stable money is a new concept for a new generation of bankers and economists. But gold has been around for thousands of years and will undoubtedly outlast these new thinkers.
via ZeroHedge News https://ift.tt/2Zy7r4W Tyler Durden
While the world is transfixed by the fireworks unleashed by the plunge in China’s yen to a record low, the real geopolitical hotspot for China remains Hong Kong, and there things are getting progressively uglier following Monday morning’s press conference by Karrie Lam who once again said she will not resign, and warned that “some people” have put Hong Kong in a very dangerous situation as protesters’ actions challenge the “one country, two systems” model and threaten prosperity by seeking to ruin the city by calling for “revolution” or the “liberation of Hong Kong.”
Hong Kong leader Carrie Lam on why she will not resign: “I don’t think at this point in time resignation of myself or some of my colleagues will provide a better solution.” https://t.co/mADFNtmUa3pic.twitter.com/C3KHxf2Aen
In a press conference in which Lam was flanked by eight top officials, including chief secretary, chiefs of finance, commerce, transport, security, health and civil service as well as home affairs undersecretary, she said she is taking responsibility by staying on to serve, arguing that resignations by her or others won’t help (several million protesters would beg to differ). Her solution: “Upholding the rule of law is the way out”, by which she means the people conceding to Beijing’s demands.
“Such extensive disruptions in the name of certain demands or uncooperative movement have seriously undermined Hong Kong’s law and order, pushing our city, the city we all love and many of us helped to build, to the verge of a very dangerous situation,” Carrie Lam says.
“The government will be resolute in maintaining law and order of Hong Kong and restoring confidence” she said, adding that “we all love Hong Kong and have made various contributions to its stability and prosperity … it’s time to say no to chaos and violence.”
The only problem is that the only ones who are eager to say “no to chaos and violence” are various Triad-linked thugs, and of course, the Chinese People’s Liberation Army, which according to report is massing on the Hong Kong border, just waiting for the green light to, well, “liberate.”
Additionally, Lam said that protests have already deviated from the original demand, Lam said. She didn’t say much on calls for an independent inquiry into police action and recent events. The General Chamber of Commerce has joined protesters in calling for an inquiry.
In a surprising reversal from prior periods when China would sternly ignore the events in Hong Kong, today even the People’s Daily tweeted account has been following every twist in the much anticipated Lam presser, quoting her verbatim as mainland China’s attention is now squarely focused on how Beijing will quell the Hong Kong rebellion.
#HongKong is on the verge of a very dangerous situation; HK govt respects protestors’ rights to express opinions but they should also respect others’ rights, HK Chief Executive Carrie Lam said Mon, adding that an emergency mechanism has been put in place to deal with Mon strikes. pic.twitter.com/mZu1BmqYuf
Meanwhile, financial Secretary Paul Chan warned Hong Kong risks a recession on protests and outside factors like trade.
He may be on to something: on Monday, a paralysing citywide strike as part of the escalating anti-government protests forced Hong Kong airport authorities to cancel some 230 flights on Monday morning. Air traffic controllers have called in sick en masse, echoing the actions of an estimated 500,000 Hongkongers from more than 20 business sectors.
The number of flights that can take off, or land, has been affected as a result, and authorities said only one of the two runways would be in operation from midday on Monday until 6am on Tuesday. Only 34 flights would be permitted per hour during that, instead of up to the 68 per hour that normally take off from the city’s international airport, according to SCMP, with flights across Asia bearing the brunt of the cancellations.
Trains and planes are also being disrupted, with multiple subway lines suspended or delayed and hundreds of flights canceled.
Finally, as Bloomberg notes, Hong Kong Police will start holding daily press briefings from today and there will be a cross-departmental briefing by the government.
Of course, after weeks of protests and with today’s crippling strike, the last thing Hong Kong stock investors needed was for the yuan to break 7 per dollar on Monday, however that’s what they got, and between the trade and now currency war, and the ongoing tensions in Hong Kong, as well as the paralyzing strike, the pace of equity losses accelerated ahead of the midday break, with the MSCI Hong Kong Index tumbling 3.3% and the bottom is not yet in sight.
But all that pales in comparison to the USD-pegged HG dollar, which in sympathy with the offshore yuan has tumbled, sliding as much as 0.11% to 7.8354 Monday, its lowest since June 12. Will it plunge further and validate Kyle Bass’s thesis of massive capital outflows and a banking sector crisis, it remains to be seen.
via ZeroHedge News https://ift.tt/2OBTmTd Tyler Durden
