Tag: news

Charles Gave: The Recession Of 2019

“While the Trump administration may crow endlessly about how swell the economy performed last quarter, that 4.1% GDP print will quickly become a wistful memory.”

-BERNARD BAUMOHL, Economist at the Economic Outlook Group

Authored by Charles Gave via EverGreen Gavekal blog,

Over the last three months, I have become increasingly concerned that a recession will hit the world economy in 2019. In this paper, I shall explain why. My reasoning is simple and is based on the behavior of an indicator I have long followed, which I call the World Monetary Base, or WMB. Every time in the past that this monetary aggregate has shown a year-on-year decline in real terms, a recession has followed, often accompanied by a flock of “black swans.” And, since the end of March, the WMB has again been in negative territory in year-on-year terms. As a result, and as I shall explain, there is a significant risk of a recession next year.

The World Monetary Base (WMB)

Before I launch into a detailed examination of my reasoning, I should perhaps recap what the WMB is and why it is so important. It starts with the US Federal Reserve, which, because it controls the dominant reserve currency, acts as de facto central bank to the world. By purchasing government bonds from domestic banks, so flooding them with reserves, the Fed can engineer an increase in the US monetary base.

The Fed also provides “reserves” to other central banks. Typically, this happens when the US dollar is overvalued and/or when the US economy grows faster than the rest of the world. This combination leads to a deterioration in the US current account deficit, which means that the US starts to pump more money abroad. These excess dollars appear first in the hands of foreign private sector companies. But if they earn more than they need for working capital, they sell the excess to their local central banks in exchange for local currency.

As a result, local monetary bases rise, and the surplus US dollars get parked in central bank foreign reserves, where they show up as a line item of the Fed’s balance sheet called “assets held at the Federal Reserve Bank for the account of foreign central banks”. Increases in this item must have as their counterpart increases in the monetary bases of non-US economies (unless foreign central banks sterilize their purchases of US dollars).

So, if I take the US monetary base, and add to it the reserves deposited by foreign central banks at the Fed, I get my figure for the World Monetary Base. From this aggregate, I can get a rough idea of the pace of base money creation around the world, either through direct intervention by the Fed in the US banking system, or indirectly through US dollar accumulation by foreign central banks. When the WMB is growing, I can be relatively confident about the future nominal growth of the global economy. And when it’s contracting, it makes very good sense to worry about a recession.

As the chart above shows, it is contracting now. So, based on the experience of the past 45 years, it seems likely that the world is entering its seventh international dollar liquidity crisis since 1973.

  • Already the usual suspects—Argentina, Brazil, Turkey, South Africa—are having a tough time. And the times are likely to get even tougher for those countries which have external debts in US dollars coupled with a current account deficit.

  • Already, the US stock market is outperforming all other major stock markets (most of which are actually going down)—a sure sign that the world is starting to suffer from a shortage of US dollars.

  • Already the spreads between the US bond market and a number of government bond markets outside the US have started to widen. This is a sign that countries outside the US have started to raise interest rates in an attempt to stabilize their exchange rates. Unfortunately, the attempt is destined to fail, if, as I believe, the problem is not an overabundance of local currencies but a shortage of US dollars.

So, as the chart above suggests, there are reasons to be alarmed. But this chart merely offers an observation, not an explanation. For the prospect of a recession in 2019 to be taken seriously, I will have to outline the sequence of events which will result in recession.

The first effect to watch out for is a contraction in international trade as a consequence of the US dollar shortage. Every time in the past that there has been a contraction in the WMB, six or so months later there has been a steep decline in the volume of world trade (at least since 1994—I only have the data back that far). These declines have almost always led to a recession, either in the OECD, or outside the OECD, as in the case of the Asian crisis. I see no reason why the same should not happen again this time around, especially as I am starting to detect a range of other signs that typically accompany the march towards a recession.

For example, if a recession is coming, it is natural to expect commodities prices to roll over. And as the chart below shows, that is what is happening.

When the volume of trade goes down, together with the prices of commodities, commodity-producers (essentially the emerging markets outside Asia) usually see their stock markets tank. And ex-Asian emerging markets have certainly taken a beating recently.

Needless to say, if these countries are having a hard time today because they have borrowed too freely in US dollars in the past, then it stands to reason that whoever lent them those dollars must be feeling the heat too. And sure enough, bank shares have cratered lately.

And, to add insult to injury, the US dollar is going up, as it tends to do every time world trade slows down or contracts.

Conclusion

A world-wide recession is looking more and more probable. And if the time lag is similar to those in the past, it could hit by March 2019. Indeed, looking at the performance of markets over the last six months, it looks as if a bear market may have already started everywhere but in the US. As I have written repeatedly in recent months, bears are sneaky animals. Their victims seldom see them coming.

As usual, little is certain. But at this point, there are a number of things that I can say with confidence.

  1. Gavekal’s statistical system to assist decision making, TrackMacro, is now registering risk-off for almost every stock market in the world. It has seven components, two of which are the WMB and world trade.

  2. The eurozone economies in general, and Italy and France in particular, are not in a position to navigate another recession.

  3. China has foreseen the danger of a US dollar shortage, and has tried to arrange things in Asia to allow the region to ride out a dollar squeeze. As a result, Asia is likely to be a zone of relative stability in the coming turmoil.

  4. For the first time in almost 20 years, cash is an alternative to risk assets. The yen is probably the cheapest currency there is today. Cash should be held in yen.

  5. Investors should hedge the equity risk in their portfolios with US long bonds and Chinese long bonds.

  6. Investors should avoid financials everywhere, as I have repeated until I am blue in the face.

  7. Investors should sell the shares of companies with negative cash flow, especially if they are short US dollars.

  8. The big risk is an uncontrollable rise in the US dollar if Europe’s fixed exchange rate system falls apart, much as earlier US dollar liquidity crises led to the collapse of fixed exchange rate systems in Latin America and Asia. Buy calls on the US dollar against the euro.

via RSS https://ift.tt/2M8EHNH Tyler Durden

Washington D.C., Charlottesville Brace For Violence At White Supremacist Anniversary Rally

Washington D.C. is bracing for violence at today’s “Unite the Right II” rally marking the one-year anniversary of last year’s deadly event in Charlottesville, VA.

Around 400 white nationalists are expected in D.C.’s Lafayette Square based on the event’s permit, however far fewer are actually expected to show up. Meanwhile, around 1,500 counter-protesters will be staging themselves at various downtown locations, including the same park as the white nationalists. 

Police are enforcing a complete ban on firearms in and around the demonstration areas on Sunday, reports Fortune, including anyone with a concealed carry permit, said Washington Metro Police chief Peter Newsham.

“Every police action that you will see on Sunday will be done with the ultimate goal of ensuring the safety of everyone that attends,” said the chief.  

In anticipation of violence, Virginia Governor Ralph Northam declared a state of emergency, stating “I am urging Virginians to make alternative plans” to avoid the event- while the Alt-Right Exposed blog noted that a left-wing “Resist” group called Shut It Down is planning to confront attendees. 

Meanwhile, protesters gathered a little over 100 miles away in Charlottesville, VA to mark the anniversary of last year’s deadly event which resulted in the death of 32-year-old counter-protester Heather Heyer after a white nationalist drove his car into a crowd she was in.

With no white nationalists around to protest, participants have turned it into an anti-police event. 

“Last year I was terrified of violence from the Nazis, and this year I’m terrified of violence from the police,” Black Lives Matter organizer Lisa Woolford, an English professor at the University of Virginia told the Daily Progress.

“Why are you in riot gear? We don’t see no riot here,” activists in Charlottesville chanted Saturday evening, while also becoming aggressive with a local news crew covering the protests. 

Shortly before a pre-planned evening rally to mark the anniversary of a campus confrontation between torch-carrying white nationalists and counterprotesters, activists unfurled a banner that said, “Last year they came w/ torches. This year they come w/ badges.” –AP

Authorities have banned skateboards, paintball guns, bats, sticks, clubs, bear spray and flying drones from Charlottesville this weekend. That said, there’s nothing stopping anyone from open-carrying an AR-15. 

‘Under Virginia law we cannot regulate firearms,’ city spokesman Brian Wheeler told DailyMail.com.

Charlottesville city elders issued a list of items that will be banned from an 18-block area in the city center all weekend just as hundreds of state police officers descended on the university town, determined to prevent a repeat of last year’s violence. –DailyMail.com

“Lengths of lumber or wood” are included on the banned list. “Metal beverage or food cans or containers’ are also forbidden, as are glass bottles.”

The full list of prohibited items: “BB guns, pellet guns, air rifles or pistols, paintball guns, nunchucks, tasers, stun guns, heavy gauge metal chains, lengths of lumber or wood, poles, bricks, rocks, metal beverage or food cans or containers, glass bottles, axes, axe handles, hatchets, ice picks, acidic or caustic materials, hazardous or flammable or combustible liquids, skateboards, swords, knives, daggers, razor blades or other sharp items, metal pipes, pepper or bear spray, mace, aerosol sprays, catapults, wrist rockets, bats, sticks, clubs, drones, explosives, fireworks, open fire or open flames, and any other item considered an “implement of riot.””

Unite the Right organizer Jason Kessler, 34, is holding the event at D.C.’s Lafayette Square after being denied a permit in Charlottesville. Kessler, a recent leftist “Occupy” activist who had a Jewish girlfriend and two African roommates, has been accused of being an opportunist. In advance of Sunday’s event, Kessler called into Stormfront Action – a white-nationalist online radio show that apparently doesn’t mind Kessler’s race-mixing past. 

During the hour-long interview last month, he unloaded a litany of hate-fueled grievances: The police in Charlottesville, he said, “screwed” him and other white nationalists last year. The media have turned him into “Damian, the son of Lucifer.” White people are “up against a wall.” Jews, he charged, “control the currency,” and are “over-represented in Congress and the Supreme Court.”

“What’s happening to us is unjust right now,” Kessler told Stormfront Action listeners. “That’s why I don’t want to back down.” –The Daily Progress

Kessler has lost support from prominent white nationalists such as Richard Spencer, while friends have also severed ties – saying they don’t recognize the activist they once knew as an Obama supporter. 

His father, in his first interview, told The Washington Post that he vehemently disapproves of Kessler’s actions and has tried to persuade him to stop. –The Daily Progress

President Trump condemned racism in a Saturday tweet which read: “The riots in Charlottesville a year ago resulted in senseless death and division. We must come together as a nation. I condemn all types of racism and acts of violence. Peace to ALL Americans!” 

After last year’s deadly rally in Charlottesville, Trump drew condemnation after he said “I think there is blame on both sides.”

Conservatives have similarly pushed back against white nationalism. Dinesh D’Souza, for example, told C-Span on August 3rd that the Charlottesville event does not represent the right. 

“This is really, I would say, the trump card, and I use that terminology in the movie, because, I have uncovered an aspect of Charlottesville, that is not in the public debate, and that is… the whole point of Charlottesville, there was a tragedy in Charlottesville, and that won’t change. Somebody was run over and killed, and so it was a tragic event in that sense.”

“What I am contesting is the meaning of that event. Because, from the left’s point of view this was right wing white supremacy, and that was the whole point for Trump to condemn it. I deny that. I deny that, and I deny it, based on a close analysis of who was there and who these white supremacists are, and in this book, “Death of a Nation,  I go through the list.”

“Jason Kessler, the organizer of Charlottesville, turns out to be an Obama activist, and an Occupy Wall Street guy.”  –Alt Right Exposed

“Think about this. Does it make sense, someone who is an Obama voter and supporter becomes a white supremacist? That makes no sense to me. You think the media would be, like ‘Let’s check this guy out.’ , but there was a Charlottesville paper that did. It looked into his background, and it turns out he has a long left-wing history. They interviewed his girlfriend, and she goes ‘he broke up with me because I am too conservative.’ This guy, Jason Kessler.”

And as the Gateway Pundit‘s Cassandra Fairbanks reports, “supporters of President Donald Trump are taking a firm stance against it and urging people on the right to donate to the Heather Heyer Foundation as a show of goodwill.”

As the next event looms, and people in the media — and even rally attendees — attempt to blur the line between the people who would attend such an event and your every day Trump voter, many on the right wanted to strongly come out against what Unite the Right represents

The large group of outspoken Trump supporters banded together and decided that the purest way to condemn the event would be to ask followers to donate at least $8.12, representing August 12, the day she died, to the scholarship fund in Heyer’s name. –The Gateway Pundit

Also noted by Fairbanks was author and journalist Mike Cernovich’s opposition to the event, who said of Jason Kessler: 

“Jason Kessler is a toad. He looks like the kind of creepy person that you could imagine staring into someone’s bedroom late at night. We of course want nothing to do with him and recognize that he is so desperate for attention that he will use the death of a woman — and step over her body — as a way to get it. That is disgusting and he’s a loser,” Cernovich said.

Also voicing his opposition is conservative film director and producer Robby Starbuck, who urged people not to give the rally any attention. 

“The Republican Party has a proud history of anti-racist activism and progress. That’s why what we’re seeing happen with White Supremacists marching in D.C. is so distressing. It reminds me of the pain Heather Heyer’s mom must be feeling. I believe in advancing progress and extinguishing hate so I’ve decided the best way forward is to remove the outrage and instead take action. I believe in taking action by ignoring these hateful racists. Turn your backs on them. Let them be the sad splinter group that they are. Let’s remove what they crave the most: Attention,” Starbuck said. “Instead I choose to honor a wonderful young woman who lost her life senselessly just one year ago. I urge everyone who can to take part and donate $8.12 to Heather Heyer’s scholarship fund, together we can counteract the evil that seeks to divide us. Together we are a force for change, do not let hateful people divide us. We can disagree but at the end of the day we are all Americans.” -Via The Gateway Pundit

With that, the day is young in both Charlottesville and D.C. With any luck, they’ll be non-events. 

via RSS https://ift.tt/2MmK8ru Tyler Durden

In Furious Rant Erdogan Lashes Out At Trump: “We See The Game You’re Playing, We Dare You”

In the wake of the U.S. doubling tariffs on Turkish steel and aluminum on Friday which sent the Turkish lira and capital markets into free fall, Erdogan wrote a Friday New York Times op-ed cataloging his grievances and threatening to walk away from the decades-old alliance. “Failure to reverse this trend of unilateralism and disrespect will require us to start looking for new friends and allies,” he wrote. Meanwhile, while announcing the new sanctions aimed at Turkey, Trump tweeted his “analysis” of the situation: “Our relations with Turkey are not good at this time!”

The escalating war of words continued on Saturday, when speaking at a rally in the Black Sea town of Unye, Erdogan said that “it is wrong to dare bring Turkey to its knees through threats over a pastor,” and blasted “shame on you, shame on you. You are exchanging your strategic partner in NATO for a priest.” At the same time, Ibrahim Kalin, Erdogan’s spokesman, said that the U.S. is “facing the risk of completely losing Turkey.”

And if anyone was hoping that Erdogan’s temper would have cooled one day later with just hours left before FX markets reopen, they were sorely disappointed on Sunday when in his latest public address in the town of Trabzon, Erdogan doubled down on his belligerent rhetoric against the US once again, via Bloomberg:

  • ERDOGAN: WE SEE THE GAME YOU’RE PLAYING; WE DARE YOU
  • ERDOGAN: THEY’RE TRYING W/ MONEY WHAT THEY COULDN’T DO IN COUP

Here one assumes that by “they” Erdogan was referring to the US, even though the Turkish’s president official line all along was that the culprit behind the “failed coup” was the exiled cleric Fethulah Gullen who has been accused by Erodgan of being behind the country’s imaginary “shadow state” for years, and which gave Erdogan a green light to crackdown on any potential opponents, leading to an unprecedented purge of people in public positions, with tens of thousands of government workers either ending up in prison or unemployed.

Erdogan then continued by calling for all Turks to convert their foreign currency holdings, i.e. mostly dollars, to liras, and warning that “economic attacks will only increase Turkey’s unity.”

Among the other notable highlights, Erdogan said that Turkey can responds to the US by “gravitating to new alliances“, i.e. China and Russia (which earlier today said it was considering dropping the US dollar altogether in oil trade), and warned that “it is foolish to think that Turkey can be thrown off by FX” although with inflation set to explode as the currency collapses, the local population may have a different view of this. 

Finally, anyone wondering which way the Lira will open later today, Erdogan did his best to make the ongoing collapse accelerate, stating that “those calling for IMF want us to give up independence”, thus eliminating the possibility of an IMF bailout which together with capital controls were the only two options Turkey had left to arrest the lira’s plunge.

As for higher interest rates, a critical requirement to at least slow down the country’s economic descent, Erdogan had some words as well:

  • ERDOGAN: AS LONG AS I’M ALIVE, WE WON’T FALL FOR INTEREST TRAP
  • ERDOGAN: INTEREST RATES MAKE THE RICH RICHER, POOR POORER

And the punchline:

  • ERDOGAN SAYS READY TO RESPOND W NEW FINANCIAL TOOLS VS DOLLAR

It was not clear what those tools would be, but they certainly would not be welcome by the market. After all, as Bloomberg reported overnight, investors believe that Turkey’s central bank will have to flout Erdogan’s desires and announce a significant increase to its benchmark 17.75 percent benchmark rate just to stop the currency’s free-fall as it touches levels that had been unimaginable even a month ago.

“Seems like a complete crash, so they need to act now,” said Morten Lund, a strategist at Nordea Bank AB in Copenhagen. “The lira will keep falling if they don’t hike rates.”

And after Erdogan’s latest rant – which clearly crushed any speculation of either more rate hikes or an IMF bail out – foreign investors may have no choice but to pull their capital out of Turkey, transforming what was already an acute currency crisis into a full blown financial panic.

Which leaves capital controls as Erdogan’s last option. The problem, as we reported yesterday, is that while the Turkish crisis was relatively contained in the context of emerging markets due to the nation’s unique capital account funding needs…

… if there was one thing that could force the Turkish collapse to escalate and result in global contagion, it is the fear of capital controls. This is how Robert Marchini, a political strategist at Zenith Asset Management laid out to Bloomberg how he see the “worst case scenario” for Turkey:

Regarding Turkey as a potential ‘Black Swan’-level event, I’m skeptical the collapse of the currency per se would be enough of an incident. The market has known for a while Erdogan was leading the country in an economically reckless direction. The real question was when it all would blow up (although I don’t think anyone thought it would go down this quickly.) More specifically, I think that the [EU] banks’ exposures to both external debt and local operations, while significant, are not at a crisis level.

Where the real risk lies, and one that I think has not been adequately considered, is the markets’ reaction to [potential] capital controls. Should Erdogan impose capital controls, in addition to banks’ writedowns on [now-toxic] Turkish assets, investors’ reaction is likely to be panic and to yank capital out of other EMs before either A. That EM’s currency falls further and/or B. That EM’s government gets the same idea as Turkey.

This becomes somewhat of a self-fulfilling prophecy, and in my opinion is where the real possibility for contagion lies.

In other words, having done nothing while the Turkish financial crisis spiraled out of control first slowly and then blazing fast, Erdogan now finds himself facing a most unpleasant dilemma: damned if he does, and damned if he doesn’t.

via RSS https://ift.tt/2Mex3kK Tyler Durden

Bloomberg Refutes Reuters, Says Saudis “In Talks” To Invest In Tesla Buyout

What a difference 24 hours makes: just yesterday, Reuters reported citing “two sources familiar with the matter”, that Saudi Arabia’s Sovereign Wealth Fund, the Public Investment Fund (PIF) which recently acquired a stake just shy of 5% in Tesla in the open market, “has shown no interest so far in financing Tesla CEO Elon Musk’s proposed $72 billion deal to take the U.S. electric car maker private, despite acquiring a minority stake in the company this year.” Reuters also added that the PIF “was not currently getting involved in any funding process for Tesla’s take-private deal.” Separately, “a second source close to the situation said PIF was not taking part in any such plan at this stage.”

Less than a day later, in what many have suggested may be damage control to avoid a gap lower in Monday trading, Bloomberg reports precisely the opposite and citing another “person with direct knowledge of the fund’s plans” that Saudi Arabia’s sovereign wealth fund “is in talks that could see it becoming a significant investor in Tesla as part of Elon Musk’s plan to take the electric car maker private.“

According to the Bloomberg source, the PIF is exploring “how it can be involved in the potential deal” and adds that discussions began before the controversial Aug. 7 tweet by Musk saying he was weighing a plan to take the company private.

Which is notable because that is the opposite of what Reuters reported.

The reasoning is somewhat bizarre: according to the report, the Saudis – whose sovereign wealth fund has been especially cash strapped in recent months as a result of the collapse of the Aramco IPO – see the investment in Tesla “as a strategic way for the world’s biggest crude producer to hedge against oil.“

And while the Saudi fund hasn’t made any firm decisions on whether to increase its stake, or by how much, the anonymous source said that “talks are ongoing” and it wasn’t immediately clear how much the fund would invest in Tesla.

The immediate answer here would be, “not much”, because as the FT reported last week, the sovereign wealth fund is lacking in the one key variable needs to make a deal, any deal happen: money, to wit:

“Riyadh is now taking radical steps to boost the fund’s coffers. The Royal Court instructed Saudi Aramco to acquire the fund’s 70 per cent stake in Saudi petrochemicals maker Sabic, potentially raising $70bn for the PIF, three people familiar with the matter said.”

Then again, all is fair in keeping up the narrative, even if it means even greater scrutiny of every public statement thrown out there by the press in support of Musk’s MBO proposal, especially now that the SEC is sniffing around and lawsuits are flying.

The U.S. Securities and Exchange Commission, which has been gathering information about Tesla’s public pronouncements on manufacturing goals and sales targets, is intensifying its scrutiny of the company’s public statements in the wake of Musk’s tweet, people familiar with the matter have said.

The Bloomberg rebuttal of the Reuters story also comes just days after 2 class action lawsuits were filed against Tesla and Elon Musk for fraud and market manipulation. And with the Bloomberg story now out, those two cases effectively fall apart as there is a public record, even though after the fact, that Musk was telling the truth.

And since it is impossible to deny the Bloomberg report, even if it conflicts completely with what Reuters reported, for now Tesla appears to be safe.

As to who is telling the truth, and who is lying – because both the Reuters and Bloomberg reports “citing anonymous sources” can not be correct at the same time – it will ultimately be up to regulators to untangle what is becoming one of the biggest and most controversial financial stories of this generation.

via RSS https://ift.tt/2OsaXIm Tyler Durden

Trader Warns: Turkey’s Meltdown Should Be “Valuable Lesson To Risk-Ignorant Investors” Worldwide

Given the goldfish-like memories of financial market participants – and outlier-stripping nature of the algos that really trade – today’s abrupt collapse will likely be a small slap in the back of the head for many traders, but as former fund manager and FX trader Richard Breslow notes, “today’s Turkey meltdown holds lessons to be forgotten.”

If only the meltdown in Turkish assets could serve as a cautionary tale for global markets, Breslow continues, then it might be a painful lesson for Turkey but a cheap and valuable one for investors elsewhere used to ignoring the risks embedded in their portfolios.

Don’t count on it.

Via Bloomberg,

It won’t be long before you hear either one of two things.

  1. That tensions have eased, carry is compelling and get in on the party while it’s getting started again.

  2. Or cries that we need the central banks to be more involved in markets and sort this whole thing out. Come home, we still love you.

Either way, prudent investing won’t be making a comeback any time soon and we can get used to this episode being one in a long line of periodic dramas. As long as the suffering happens “over there”, this will be seen as theater but not tragedy.

Bad economic policies, bad politics, pathetic liquidity when things get tough, lazy positioning by those who should know better and those that have no business having positions, a complete misunderstanding of where and why alleged contagion should be felt and various banks being over-exposed to markets without the proper hedges have all been top of the mind today. Destined to be forgotten forthwith.

Or, more accurately, all of this is purged from the zeitgeist because it doesn’t suit the narrative in a world addicted to carry, that wants to believe banks are comfortably capitalized, stress tests test for the right things and liquidity will be there when it’s actually needed.

You’ll notice that yesterday morning, when the dollar surged over 10 percent against the lira and then pared the bulk of it, all in the space of about 30 minutes, you were told the lira market is broken rather than we just had another flash crash. Can’t resurrect that old fear.

With the world engaged in constant strife and what appears to be a vicious zero-sum game, ignorantly investing in markets we don’t understand comes at a price. Turkey gives you a first-hand look at the future…

via RSS https://ift.tt/2nw5zZa Tyler Durden

Russia Finance Minister: We May Abandon Dollar In Oil Trade As It Is Becoming “Too Risky”

One month ago, the bond market and political pundits did a double take when according to the latest Treasury International Capital report, Russia had liquidated virtually all of its US Treasury holdings, selling off the bulk of its US government bonds in just two months, March and April.

And with the US threatening to impose a new set of “crushing” sanctions on Russia, including in retaliation for the alleged Novichok nerve gas attack in the UK, Russia not only intends to continue liquidating its US holdings, but to significantly reduce its reliance on the US Dollar.

Speaking in an interview for the Rossiya 1 TV channel, Finance Minister Anton Siluanov said that Russia “aims to keep reducing its investments in American securities” following new U.S. sanctions and said that the “US dollar is becoming an unreliable tool for payments in international trade.” The minister also hinted at the possibility of using national currencies instead of the dollar in oil trade.

“I do not rule it out. We have significantly reduced our investment in US assets. In fact, the dollar, which is considered to be the international currency, becomes a risky tool for payments,” Siluanov noted.

On Friday, the Russian ruble sank to the lowest level in over two years after news about new US sanctions against Russia over the alleged poisoning of former Russian intelligence officer Sergei Skripal and his daughter Yulia in Salisbury, UK, coupled with general selling of emerging market currencies as a result of the growing Turkish financial crisis.

According to media reports, the first package will imply a complete ban on the export of electronic devices and dual-use components to Russia, whilst the second package may include a decrease in diplomatic relations, a ban on flights of Russia’s Aeroflot carrier to the United States and an almost complete suspension of US exports.

Siluanov said the sanctions are “unpleasant,” but nothing fatal. In response, Moscow will only continue to minimize investment in the US economy and securities and will push for payments in rubles and other currencies, including the euro.

The response, however, will not target American companies operating in Russia, he said. “Currently, we do not plan any restrictive measures or closures, for example, to close McDonald’s, as our citizens work in these companies.”

Meanwhile, as Russia is contemplating abandoning the dollar, the recently introduced Chinese “petroyuan” oil futures contract has seen a surge in interest recently, and just last week we showed that the Chinese oil futures contract spiked to a new record high, coinciding with the re-imposition of US sanctions on Iran. This was the biggest daily move in China’s oil futures since the contract’s inception in March to a new all time high.

The move coincided with the first of two rounds of US sanctions against Iran kicking off and targeting Iran’s access to US banknotes and key industries, including cars and carpets. As we further noted, there has been a notable decoupling from Brent and WTI futures, suggesting a sudden burst of contract-specific buying demand in the ‘petroyuan’

What may explain the sudden surge? simple: China can effectively bypass Iran sanctions by pricing Iran oil in China’s own currency, a move underscored by yesterday’s news that China has replaced French energy giant Total with an 80.1% stake in the phase 11 of the South Pars (gas field), which has the world’s biggest natural gas reserves ever found in one place.

With Russia hinting that it is close to giving up on the dollar entirely in oil trade and shifting to a petroyuan-based regime, how long before other nations follow suit, especially with the US increasingly energy self-sufficient?

via RSS https://ift.tt/2Ma1AAd Tyler Durden

Seattle Airport Employee Who Stole And Crashed Plane Identified

The name of the airline worker who stole an empty airplane from Seattle–Tacoma International Airport in a security scare that caused the scrambling of U.S. fighter jets and ended when the plane crashed onto a sparsely populated island has been revealed.

He’s been identified as 29-year old Richard “Beebo” Russell — a Horizon Air employee described by friends and family as “an avid traveler, a high-school football standout and Christian youth leader who once operated an Oregon bakery with his wife,” according to the Seattle Times.

Russell went down in a fiery crash of the Bombardier Q400 turboprop on Ketron Island after pulling off a barrel roll and coming within feet of the water in what ultimately appeared to be a highly theatrical suicide. He spoke of family and friends and a disappointed life to the air traffic controller who spent the hour trying to talk him into landing: “It’s going to disappoint them to hear that I did this. I would like to apologize to each and every one of them. Just a broken guy, got a few screws loose, I guess. Never really knew it, until now,” the now viral audio of the cockpit call captures Russell as saying. 

Investigators on Saturday not only sought further indicators of a precise motive and the events leading up the ground worker’s unauthorized entry onto the plane, but began picking through the crash sight to recover the aircraft’s flight-data recorder and cockpit voice recorder.

Richard Russell, a 29-year-old ground-service agent. YouTube screengrab via Seattle Times

“He was a quiet guy. It seemed like he was well liked by the other workers,” Rick Christenson, a recently retired operational supervisor with Horizon Air, told the Seattle Times. “I feel really bad for Richard and for his family. I hope they can make it through this.”

Russell, who it turns out is believed to likely have had some basic formal flight training but no pilot’s license, worked as a member of Horizon’s tow team, responsible for moving airplanes on the tarmac with a tow tug vehicle, and he also handled baggage transport for the airline. 

Other details of his life to emerge include that he was very active in church as a youth director, and spent most of his later childhood growing up in Alaska before moving to Oregon with his wife in 2010 where both attended college. Former co-workers have described Russell as “super gregarious, funny, a hard worker.”

Some former and current co-workers of Russel’s were actually on-hand Friday night when they saw the plane flying over the area with two National Guard F-15 fighter jets followed closely behind. “We got binoculars and were watching him. He was flying real strange, hard banks, real radical flying for a Dash-8,” Christenson described.

When the plane nose-dived toward the water at one point, Christenson relates of the moment, “We were all screaming, ‘Oh my god, oh my god,’ and I was yelling, ‘Pull up, pull up,’” Christenson said. “Everybody’s stunned … that something like this would happen,” Christenson said. “How could it? Everybody’s been through background checks.”

Local news sources describe Russell’s family as being in a state of shock, but the family released a statement late on Saturday calling him a “warm, compassionate man.”

”This is a complete shock to us,” the statement read. “As the voice recordings show, Beebo’s intent was not to harm anyone and he was right in saying there are so many people who loved him.”

“He was a faithful husband, a loving son, and a good friend,” the statement continued. “A childhood friend remarked that Beebo was loved by everyone because he was kind and gentle to each person he met.”

Ketron Island, soon after the crash, with smoke rising above the impact site. Image source: AP 

Airline and law-enforcement officials on Saturday provided some level of details as to how the ground worker was able to board and steal the plane. 

“He worked a shift yesterday. We believe he was in uniform,” said Alaska Air Group chief executive officer Brad Tilden, which is the parent company to Horizon Air. “It was his job to be around airplanes.” The company identified Russell as having been their employee for nearly four years. 

The airline company spokesman further identified that Russell himself towed the aircraft into position so he could easily taxi the aircraft in preparation for takeoff. Notably, the spokesman confirmed the traffic control tower “did know this was an unauthorized departure.”

Horizon’s CEO Gary Beck was quoted as noting that Russell had pulled off some “incredible maneuvers” once airborne, unlikely for someone who’s not believed to have had a pilot’s license. “Commercial aircraft are complex machines,” he said. “So I don’t know how he achieved the experience that he did.”

FBI’s Seattle division, the lead investigator’s on the scene of the crash, are reportedly attempting to definitively rule out whether or not Russel had help either on the plane or before taking off. When an FBI official was asked about Russell’s mental state, he responded, “It’s way too early to comment on that. I’m sorry.”

via RSS https://ift.tt/2P45ato Tyler Durden

Infowars Website Traffic Explodes After Silicon Valley Blacklists Alex Jones Empire

Silicon Valley’s coordinated purge of all things Infowars from social media has had an unexpected result; website traffic to Infowars.com has soared in the past week, according to Amazon’s website ranking service Alexa. 

Infowars was recently banned by YouTube, Facebook, iTunes, Google Podcast, Spotify, iHeartRadio, MailChimp, Disqus, LinkedIn, Flickr, Pinterest and several others – leading many to wonder exactly how and why this was seemingly coordinated mass takedown took place between platforms. 

Jones’ popular supplements were even stripped of their “Amazon’s Choice” tags on the website: 

That said, Google and Apple are still allowing people to access Infowars content via apps, which have seen their downloads spike as well.

Consumers still can access InfoWars through the same tech companies that just banned it. Google still offers the Infowars app for Android users, and Apple customers can download it through the App Store.

As of Friday, the show’s phone app remained near the top of the charts in both the Apple App and Google Play stores. Infowars Official, an app that lets viewers stream Jones’ shows and read news of the day, was ranked fourth among trending apps in the Google Play store Friday. In the news category on Apple’s App Store, Infowars earned the fourth slot under the top free apps, behind Twitter and News Break, a local and breaking news service, revealing a sudden boost of user downloads. –American Statesman

What’s more, Jones says that 5.6 million people subscribed to the Infowars newsletter within 48 hours of his YouTube ban, according to the Daily Mail. 

What’s more he claims the publicity surrounding the action taken by the likes of YouTube, Facebook and Apple – who have blocked his content and removed his channels – has gained him millions of subscribers – not lost him followers.

Jones claims 5.6million people have subscribed to the Infowars newsletter and free podcast in the past 48 hours.

Branding what’s happened ‘bull***t’, the 44-year-old Texan said: ‘Why not say I’m flying a Nazi flying carpet. I sit up in the morning and I s**t Hitler out of my a**. It’s bull***t. –Daily Mail

“Because I play devil’s advocate, because I play both sides, they’ve taken me out of context, they are using me as a test case to try to bring an EU style web censorship,” Jones said. “They’ve got mainline Democratic senators saying they ought to restrict Fox News, Tucker Carlson, Matt Drudge, the President himself. They are misrepresenting what I’ve said and done and are using that to set a precedent for internet wide de-platforming, censorship beyond what Russia does, what China does, ahead of the midterms (election). The whole thing is fake.”

Looking at Infowars’ stats, a little over 10% of their pre-ban traffic in July came from social media, with Facebook about half of that. Which likely means that Jones will survive as most of his traffic is direct, as users access the site via typing it into the URL bar or click on a bookmark, instead of coming through search engines. 

In terms of dollars and cents, the website Social Blade estimates that over the last 30 days, the Infowars YouTube channel received a little over 17 million views. With average YouTube ad revenue is around $2 per 1,000 clicks (CPM), and InfoWars undoubtedly demonetized for much of that, YouTube’s decision to ban Jones and his channels cost the Infowars enterprise up to $400,000. 

Meanwhile, a flood of new traffic has been driven to Infowars.com, which is probably paying a much higher CPM. It’s entirely possible that if the newfound site visitors stick around, Jones would end up more profitable than before he was blacklisted. 

via RSS https://ift.tt/2P4tFqK Tyler Durden

Censorship Purge Signals Imminent False Flag Violence Before Mid-Term Elections… Bigger Than 9/11?

Authored by Mike Adams via NaturalNews.com,

For the last two months, I’ve been warning about the rising risk of a major false flag attack taking place before the mid-term elections.

The aggressive, unprecedented PURGE of Alex Jones / InfoWars underscores the desperation of the totalitarian deep state that’s about to make a move to eliminate President Trump and / or steal the elections.

Anyone who believes that the sudden de-platforming of Alex Jones across over a dozen online services and platforms isn’t coordinated collusion is delusional. The coordinated de-platforming effort is clearly directed by the deep state to eliminate a prominent, dissenting voice in preparation for unleashing a history-shaping false flag attack that’s likely going to be bigger than 9/11.

The radical Left is escalating its violence across America, and the tech giants are dramatically escalating their censorship actions to silence all independent voices that might question any “official” narrative.

It all points to something big about to come down – something so big that only the official narrative can be allowed to be heard or spoken.

We are living under an Orwellian totalitarian regime beyond any horrific imagination. Google, Apple, YouTube, Facebook, Twitter and other tech giants are engaged in the most criminal, malicious racketeering and tyranny imaginable. This is not sheer coincidence. They’ve all been ordered to censor the independent media in preparation for what’s coming next.

As I explain in this video, the most likely false flag assault to be staged by the Left might be a “mass shooting” at CNN or another media giant, all staged with impressive theatrics to augment the real violence with a false narrative. Watch my entire warning, below:

REAL.video/5820541704001

Read more articles about false flag events at FalseFlag.news.

Also check out the shhnookered channel at REAL.video which now has multiple video channels covering mass shooting events in U.S. history.

via RSS https://ift.tt/2B2M4AX Tyler Durden

Mapping The 22 Cities With The Most Million-Dollar Homes In America

Throughout most of America, owning a $1 million home gives you definite bragging rights – it means you may have six bedrooms, 5,000 square feet, an infinity pool, and at least a few acres of property.

But, as Visual Capitalist’s Jeff Desjardins notes, along the coasts – and particularly in California – the two comma club has lost most of its novelty. That’s because in some places, like San Jose, CA, the majority (53.8%) of homes are already soaring past the $1 million mark, despite most of them looking nothing more than ordinary.

$1 MILLION HOMES BY CITY

Today’s chart uses data from a study by LendingTree, which ranks the largest 50 U.S. cities by the percentage of million dollar homes in each metro area. The data from the study was pulled out of a database of 155 million property prices throughout the country.

Courtesy of: Visual Capitalist

Here are the 22 U.S. cities that have at least 1% of their housing stock exceeding the $1 million value mark:

The data looks pretty telling, with four of the top five cities being located in California. In each of those cities, more than 10% of all homes have surpassed the $1 million mark.

In the Bay Area specifically, prices are amplified even further: San Francisco (40.0%) and San Jose (53.8%) have by far more $1 million homes than other major cities in the country. It’s also worth noting that in San Jose, the median price of all homes is a whopping $1,069,000.

You can just imagine what houses might cost in some of the Silicon Valley towns like Mountain View or Palo Alto, or just over the Golden Gate Bridge in Marin County.

THE BOTTOM OF THE LIST

While the above chart shows the 22 U.S. cities with the most $1 million homes, LendingTree also listed the major cities in the country with the fewest.

Buffalo, located in upstate New York, takes this title, with only 0.10% of homes passing the mark and an overall median home price of just $141,000. So, to buy the average home in San Jose, you’d need to sell off about eight average houses in Buffalo.

The other cities with the smallest concentrations of million dollar homes are also located in the Great Lakes and Midwest regions: Pittsburgh (0.17%), Hartford (0.18%), Cleveland (0.19%), and Indianapolis (0.27%).

via RSS https://ift.tt/2nu7ptB Tyler Durden