IMF Head Lagarde Convicted Of Negligence, Faces No Jail Time

International Monetary Fund Managing Director Christine Lagarde was found guilty of one count of negligence by a French court today, according to Bloomberg News. She was accused of failing to prevent a massive government payout to businessman Bernard Tapie eight years ago, while serving as France’s finance minister, but most surprising, she will face no fine or jail sentence.

International Monetary Fund chief Christine Lagarde convicted of one count of negligence by Paris court over her handling of a multi-million dispute when she was France’s finance minister.

  • 60-year-old IMF managing director convicted at the Cour de Justice de la Republique, over events that occurred nearly a decade ago
  • Lagarde won’t face fine or jail sentence, judge says
  • Lagarde was negligent in 2008 decision not to appeal arbitration, judge says
  • Lagarde decided in mid-2008 not to appeal a 285 million-euro ($303-million) arbitration award for businessman Bernard Tapie that led to a massive government payout
  • Lagarde was cleared of second count related to her 2007 decision to take Tapie dispute to arbitration Story Link: Lagarde Faces Setback as Critic Says Payout Was Scandalous (1)
  • Case stems from former state-owned bank Credit Lyonnais’s disagreement with Tapie over the 1993 sale of Adidas AG, which he owned

via Tyler Durden

Key Events In The Coming Pre-Holiday Week

The key economic releases this week are durable goods and GDP on Thursday. Chair Yellen’s speech on the labor market on Monday afternoon is also likely to garner considerable attention. While the calendar gets quieter in the weeks ahead over the holiday season, there are a few notable macro events to keep traders occupied.

This week, the Bank of Japan and Riksbank deliver their latest policy verdicts, and we also get the RBA Minutes, while in the first week of the new year attention turns to FOMC Minutes and NFP, as well as Eurozone inflation.

BoJ: Maintaining status quo

Consensus expects the BoJ to maintain the status quo, keeping the short rate and JGB 10yr yield target unchanged. The MPM will be watched for clues whether the BoJ still envisions the yield curve as it did in Sep. We expect the governor to quash expectations of an early rate hike, reiterating that the BoJ is prepared to pledge to use fixed-rate operations as needed, with unlimited capacity for purchases.

Riksbank: QE extension but no rate cut

Rates are expected to remain on hold with a small extension of QE of SEK20-30bn in nominal and real bonds. There are limited options left in the monetary policy toolbox, and diminishing returns to even more easing, suggesting that further QE may function more as a tool to prevent excessive strength rather than as a path to further SEK weakness.

In other data

In the US, the main releases this week include existing and new home sales, the final print of Q3 GDP, personal income & spending as well as U. of Michigan sentiment data. After the Christmas break, we get pending home sales, consumer confidence, ISM and trade balance in addition to the FOMC Minutes and NFP.  In the Eurozone, a quiet calendar ahead. In the first week of 2017, we get December inflation data and final PMIs.  A light UK calendar, with public finances data, the final print of Q3 GDP and current account balance this week. We start 2017 with PMIs and the latest Gilt purchase data. In Japan, focus will be on the BoJ, but we also get minutes, labor market data, CPI, industrial production and retail sales in the coming weeks.

* * *

A breakdown of global events on a daily basis, courtesy of Deutsche Bank:

  • The sole release in Europe this morning comes from Germany where the December IFO survey will be released. This afternoon in the US the only data of note are the remaining December flash PMI’s (services and composite readings).
  • Tomorrow morning we kick off in Japan with the BoJ decision followed just after by Governor Kuroda’s press conference. Over in Europe we start with Germany again with the latest PPI print while in the UK the latest CBI reported retail sales data for this month will be out. There’s nothing of note in the US tomorrow afternoon.
  • Wednesday is another quiet day with France PPI, UK public sector net borrowing data, Euro area consumer confidence and US existing home sales data due up.
  • We’ll finally get a bit of action on Thursday. While the morning session is quiet, with Germany’s import price index reading the only data, during the afternoon in the US we’ll get the third reading for Q3 GDP along with a first look at the November durable and capital goods orders data. Also due out will be the November personal income and spending reports, core and deflator PCE readings, initial jobless claims, FHFA house price index, Kansas City Fed’s manufacturing survey and the Conference Board’s leading index.
  • We close out the week in Asia on Friday with the MNI business indicator in China. During the European session we’ll get consumer confidence data in Germany along with the final UK and France Q3 GDP revisions. We finish the week in the US on Friday with new home sales data and the final University of Michigan consumer sentiment reading.

* * *

Courtesy of Goldman, here is a US focused breakdown, with full consensus estimates:

Monday, December 19

  • 09:45 AM Markit Flash US Services PMI, December preliminary (consensus 55.2, last 54.6)
  • 1:30 PM Federal Reserve Chair Yellen Speaks (FOMC Voter): Federal Reserve Chair Yellen will address the University of Baltimore Commencement on the subject of “The State of the Job Market.” In her FOMC press conference last Wednesday (12/14), Yellen referenced the possibility of “some additional slack in labor markets,” but judged that the overall degree of slack “has diminished,” with broader measures such as the U6 having “come down considerably.” Indeed, she compared the current state of the labor market to that of 2007, which she characterized as “in the vicinity of maximum employment.” The text of the speech is expected to be published online, but there will be no audience/media Q&A.

Tuesday, December 20

  • No major data releases.

Wednesday, December 21

  • 10:00 AM Existing home sales, November (GS -0.5%, consensus -1.8%, last +2.0%): Regional housing data released so far suggest a sharp acceleration in closed homes sales in November. However, most of this expected strength is attributable to a favorable calendar shift that the NAR seasonal factors should anticipate (one extra selling day in November and one fewer selling day in October). On a seasonally adjusted basis, we therefore expect a modest decline of -0.5% (mom) following last month’s 2.0% increase. Existing home sales are an input into the brokers’ commissions component of residential investment in the GDP report.

Thursday, December 22

  • 08:30 AM Durable goods orders, November preliminary (GS -3.0%, consensus -4.5%, last +4.6%):  Durable goods orders ex-transportation, November preliminary (GS flat, consensus +0.2%, last +0.8%); Core capital goods orders, November preliminary (GS +0.5%, consensus +0.5%, last +0.2%); Core capital goods shipments, November preliminary (GS flat, consensus n.a., last -0.1%): We expect durable goods orders to fall 3.0%, primarily due to retrenchment in commercial aircraft orders following an above-trend reading in October. We expect core capital goods orders to increase 0.5% based on resilience in manufacturing surveys and encouraging commentary from industrial firms. However, November industrial production of business equipment softened at -0.3% mom, so we expect a flat reading for core capital goods shipments. Finally, we expect unchanged durable goods orders ex-transportation, weighed down by a stronger dollar and falling durable goods prices. Over the last year, core capital goods orders declined by 4.3%, while core capital goods shipments declined by 5.0%.
  • 08:30 AM GDP (third), Q3 (GS +3.2%, consensus +3.3%, last +3.2%); Personal consumption, Q3 (GS +2.8%, consensus +2.8%, last +2.8%); The BEA on Thursday will publish the third vintage of Q3 GDP, which we expect to remain at +3.2%. Consensus expects a modest 0.1pp upward revision to 3.3%.
  • 08:30 AM Initial jobless claims, week ended December 17 (GS 255k, consensus 259k, last 254k): Continuing jobless claims, week ended December 10 (consensus 2,010k, last 2,018k); We expect initial jobless claims to remain essentially flat at 255k after 254k last week. Initial claims can be difficult to seasonally adjust around this time of the year, and we see the underlying trend in recent claims reports as fairly stable, reflecting a subdued pace of layoff activity.
  • 09:00 AM FHFA house price index, October (consensus +0.4%, last +0.6%): Consensus expects a 0.4% gain in the FHFA house price index in October, which has risen 6.1% over the past year. FHFA home prices increased 0.6% in September, in line with consensus expectations. The FHFA house price index has a wider geographic coverage than the S&P/Case-Shiller housing price index, but is based only on properties financed with conforming mortgages.
  • 10:00 AM Personal income, November (GS +0.4%, consensus +0.3%, last +0.6%); Personal spending, November (GS +0.3%, consensus +0.3%, last +0.3%); PCE price index, November (GS +0.05%, consensus +0.2%, last +0.24%); Core PCE price index, November (GS +0.05%, consensus +0.1%, last +0.11%); PCE price index (yoy), November (GS +1.5%, consensus +1.5%, last +1.2%); Core PCE price index (yoy), November (GS +1.8%, consensus +1.7%, last +1.7%): We expect personal income to rise by 0.4% and personal spending to rise by 0.3% in November. Based on details in the PPI and CPI reports, we expect core PCE prices to increase by 0.05% in November, or 1.7% from a year ago; we believe risks to this estimate are skewed to the downside. In the November report, core CPI increased by 0.15% month-over-month, or 2.1% from a year ago. Continued relatively moderate inflation readings may temper concerns that Fed policy has fallen behind the curve.
  • 10:00 AM Leading indicators, November (consensus +0.2%, last +0.1%)
  • 11:00 AM Kansas City Fed manufacturing index, December (consensus 1, last 1)

Friday, December 23

  • SIFMA recommends an early 2:00 PM close to bond markets.
  • 10:00 AM New home sales, November (GS +3.0%, consensus 2.1%, last -1.9%): We expect new home sales to rise 3% in November, driven by unseasonably warm weather and a favorable fundamental backdrop. New home sales are highly volatile on a month-to-month basis. While headline housing starts and building permits fell sharply in November, the single-family components remained relatively stable, consistent with continued improvement in homebuilder activity. We plan to closely monitor housing releases in the coming months for signs that higher interest and mortgage rates are constraining home sales, which could in turn affect the outlook for residential fixed investment.
  • 10:00 AM University of Michigan consumer sentiment, December final (GS 98.5, consensus 98.0, last 98.0): We expect the University of Michigan consumer sentiment index to increase further to 98.5 in the December final estimate, following a 4.2pt improvement in the preliminary reading. The Conference Board’s consumer confidence index jumped to a new cyclical high in the November report.

Source: DB, BofA, GS

via Tyler Durden

Electoral College Votes Today, 300 Arrested in Venezuela Protests, Zsa Zsa Gabor Dies: A.M. Links

  • The Electoral College votes for president today.
  • Thousands of people are evacuating Aleppo as United Nations observers watch.
  • More than 300 people were arrested at protests in Venezuela over the government’s decision to eliminate the 100 bolivar note.
  • Malaysia is hosting a regional summit to discuss alleged crimes against humanity against the Muslim community of Rohingya in Myanmar.
  • Video released by the Monterey Bay Aquarium Research Institute captures the ghost shark on camera for the first time.
  • Zsa Zsa Gabor died, aged 99.

Follow us on Facebook and Twitter, and don’t forget to sign up for Reason’s daily updates for more content

from Hit & Run

Obama Admits Hillary “Lost Badly” By Failing To “Make An Argument” That Inspired People To “Show Up”

After weeks of pushing the “Russian hacking” narrative, mostly through White House Press Secretary Josh Earnest, Obama is finally admitting that Hillary “lost badly” in her presidential bid by failing to make an argument to people in the Midwest that inspired them to “show up.”  In an “exit interview” with NPR, Obama said that Democrats face “structural problems” with their base clustered in urban areas on the coasts which requires presidential candidates to make their case to swing voters in the Midwest, something he says Hillary failed to do.  Per The Hill:

“There are some things that we know are a challenge for Democrats — structural problems,” he said.


Obama noted that Democratic voters are often clustered in urban areas and on the coasts.


“So as a consequence, you’ve got a situation where there’re not only entire states but also big chunks of states where, if we’re not showing up, if we’re not in there making an argument, then we’re going to lose,” he said.


And we can lose badly, and that’s what happened in this election.”

Perhaps the President is admitting that a little less golf in his second term might have been beneficial to his party?

Obama Golf


Of course, when pressed on whether the electorate understood the democratic argument and simply chose to reject it, Obama assured NPR that that simply couldn’t be the case.  As Obama has told us many times, if anyone disagrees with his position on a certain policy then it is simply because they must not fully understand it. 

Obama said he doesn’t think the Democratic Party’s problem is its core argument. The values presented by the Democratic Party have strong support, he said, citing the minimum wage.


“There are clearly, though, failures on our part to give people in rural areas or in exurban areas, a sense day-to-day that we’re fighting for them or connected to them,” he said.


A lot of people, he added, don’t know about the Obama administration’s push for collective bargaining or overtime rules and are not aware of all the benefits of the Affordable Care Act.

Finally, proving that he still has no idea what happened last month, Obama once again blamed Fox News and Hillary’s failure to adequately pander to the right people…Obama’s words are much more subtle than ours, of course.

“Some of it is the prism through which they’re seeing the political debate take place.”


“So part of the reason it’s important to show up, and when I say show up, I don’t just mean during election time, but to be in there engaging and listening and being with people,” he said, “is because it then builds trust and it gives you a better sense of how should you talk about issues in a way that feel salient and feel meaningful to people.”

To quote Judge Jeanine Pirro from this weekend, the American people “rejected you and everything you stand for,” Mr. President.  The American people rejected the idea of catering a message “in a way that feels salient and feels meaningful” to each individual group while doing absolutely nothing after election day.  The American people chose action over meaningless political narratives.

via Tyler Durden

Saudi Arabia Lobbying To Amend Sept 11 Law

Following last week’s report that Saudi Arabia is starting to apply pressure on the incoming Trump administration by hinting it could move the Aramco IPO away from New York to some still undeteremined venue due to concerns the recently passed Sept 11 law could make business in the US problematic, on Sunday Saudi Arabia’s foreign minister said he has been lobbying US legislators to change a law allowing victims of the September 11, 2001 attacks to sue the kingdom.

According to AFP, Adel al-Jubeir told reporters he had returned from an extended stay in the United States, which was partly “to try to persuade them that there needs to be an amendment of the law”, the Justice Against Sponsors of Terrorism Act (JASTA). In September, the US Congress voted overwhelmingly to override President Barack Obama’s veto of the JASTA. While 15 of the 19 Al-Qaeda hijackers who carried out the 9/11 attacks were Saudi, Riyadh continues to deny any ties to the plotters who killed nearly 3,000 people, and is worried disclosures in court could lead to material complications about conducting business in America.

“We believe the law, that curtails sovereign immunities, represents a grave danger to the international system,” Jubeir said at a joint press conference with visiting US Secretary of State John Kerry.

John Kerry talks and Saudi Minister of Foreign Affairs Adel al-Jubeir,
on December 18, 2016 in Riyadh

In opposing the law, Obama said it would harm US interests by opening up the United States to private lawsuits over its military missions abroad; on the other hand Trump has been a fervent supporter of the bill. He called Obama’s veto attempt shameful and said it would “go down as one of the low points of his presidency.”

In a statement before Congress voted to overturn the veto, Mr. Trump said: “If elected president, I would sign such legislation should it reach my desk.” Mr. Trump didn’t respond to requests for comment.

Saudi Arabia’s Gulf allies have also expressed concern about erosion of sovereign immunity, a principle sacrosanct in international relations.

But the potential implications go far beyond the Gulf. Some British, French and Dutch lawmakers have threatened retaliatory legislation to allow their courts to pursue US officials, threatening a global legal domino effect.

“The United States is, by eroding this principle, opening the door for other countries to take similar steps and then before you know it international order becomes governed by the law of the jungle,” Jubeir said.

He added that the US itself would suffer most from the erosion of sovereign immunity. “The question now becomes how do you go about amending the law”, he said.

Meanwhile, John Kerry, whose visit was focused on the war in Yemen, at the press conference reiterated his government’s concern over JASTA.

via Tyler Durden

How is Martin Sheen any different than Vladimir Putin?

One of the quirks about being an expat in a faraway land is that, whenever something unusual happens in your home country, your local friends look to YOU for answers.

You become, by default, the de facto expert of your home country’s nuances.

Case in point: this weekend we had an intercompany Christmas party down here at the farm for two of the businesses that I run.

(Sadly there may be some video floating around YouTube of me singing “Lost that lovin’ feeling”)

The first is Sovereign Man, whose Chile-based staff consists of highly eclectic, internationally-minded folks from the US, Russia, Ukraine, Lithuania, Germany, Australia, Argentina, etc.

Then there’s the agricultural business that I co-founded in 2014; it’s one of the fastest growing companies in the industry, and we currently have around 350 employees, most of whom are Chilean.

Even though I’ve spent more than the last decade traveling to over 120 countries and living outside of the United States, I’m one of the only US citizens that these guys know.

So you can probably imagine that I’ve spent the last few months fielding their questions about Donald Trump and the US election.

Now the conversations has turned to the Electoral College, which meets today.

It’s difficult to explain to foreigners why the United States, which they perceive as the most advanced country in the world, still uses an electoral system that was designed in the 1780s.

It’s even more difficult to explain to foreigners why Hollywood celebrities are trying to interfere with America’s political process.

In Latin America, celebrities do normal celebrity stuff.

They score goals on the soccer field, date pop starlets, and engage in childish antics that make the cover of sports and entertainment magazines.

But nobody actually takes these people seriously.

Nor do the local celebrities have a self-righteous sense of entitlement to influence a national election. They stick to their TV shows and Gooooooooooooooals.

But a lot of my employees have seen this video of Hollywood celebrities trying to convince 37 “Electors” from the Electoral College to NOT vote for Donald Trump.

I don’t have a good answer to explain to a foreigner why Martin Sheen feels like he’s entitled to influence the outcome of the election– seemingly because he once played at President on television…?

It would be like Jane Seymour, who used to play Dr. Quinn Medicine Woman, feeling entitled to influence national healthcare legislation.

Or Scrooge McDuck wanting to set monetary policy.

This isn’t about celebrities voicing an opinion; it’s about brazenly trying to manipulate the election.

Ironically, the media has slammed Russia and its President Vladimir Putin for allegedly trying to manipulate the election.

So if Russia messes with the political process to advance Donald Trump (as the official narrative goes), it’s evil.

Yet when Martin Sheen blatantly tries to manipulate the election against Donald Trump with a pathetic piece of propaganda, the New York Times is noticeably silent.

Look, it’s fair to debate the merits and drawbacks of the incoming President, as well as the anachronistic Electoral College system itself.

But in trying to manipulate the process, these celebrities and their media cohorts prove they’ve failed to understand anything that’s just happened.

People are sick and tired of self-righteous elites trying to control the system.

This is what voters have been viscerally rejecting.

It’s a big reason why Donald Trump was elected to begin with, why Brits voted for Brexit, and why Italians rejected constitutional reform.

They’ve had entitled, out of touch moral crusaders pushing them around for years.

These people act as if they’re taking up some honorable burden to make decisions on your behalf because you’re too stupid and infantile to make up your own mind.

It’s insulting. Voters are tired of it. And these whiny celebrity activists are just digging themselves deeper.

from Sovereign Man

Are You A Deplorable?

Submitted by Charles Hugh-Smith via OfTwoMinds blog,

Regardless of your ethnicity, class or religion, if you perceive the institutions that govern American life as corrupted, riddled with favoritism and spin or as broken, you're a Deplorable.

Are you a Deplorable? The answer might surprise you. Take this short quiz to find out.

1. If you agree with this characterization of American Elites: "The self-satisfied cosmopolitan culture that sprang up among the affluent 20% or so of the industrial world’s population, who became convinced that the temporary ascendancy of policies that favored their interests was not only permanent but self-evidently right and just." (The Fifth Side of the Triangle The Archdruid Report)

You're a Deplorable.

2. If you question whether globalization is actually in the national interest: You're a Deplorable.

3. If you question whether endless wars of choice, drone strikes and foreign interventions that cost the lives of countless civilians are actually in the national interest: You're a Deplorable.

4. If you see the major institutions of American life as corrupt, ineffective, and blatantly favoring the financial/social elites: You're a Deplorable.

5. If you think it's wrong that some immigrants (the illegal ones) get to "jump the queue" ahead of the millions of legal immigrants who have waited patiently for years and paid the costs of following the rules: You're a Deplorable.

6. If you see the concentration of media ownership as a threat to democracy:

You're a Deplorable.

7. If you think the War on Drugs that's imprisoned millions of young men is actually a War on the American People, a war that was prosecuted for the entire 24 long years of the presidencies of Bill Clinton, G.W. Bush and Barack Obama: You're a Deplorable.

The US population has increased about 40% since the War on Drugs started in earnest in 1980, while the prison/Gulag population has increased over 400% since 1980.

8. If you see the informal quotas on Asian-American students in America's Ivy League universities as wrong and blatantly racist: You're a Deplorable.

9. If you favor kicking over the tables of the money-lenders at the temple–those wonderful money-lenders who fund the campaigns of our political elites– You're a Deplorable.

10. In summary: if you question the self-serving, self-congratulatory, hubris-soaked dominance of the neoliberal Elites, You're a Deplorable.

If you think being Caucasian is a requirement to qualify as a Deplorable, think again: anyone can be a Deplorable. If you're a Hispanic-American or African-American who has seen your community gutted by the War on Drugs, and you're against the American gulag, then you're questioning the status quo: Bingo, you're a Deplorable.

If you're an Asian-American who is tired of accepting blatantly racist limits on Asian students in top-tier U.S. universities–the same sort of insidiously informal quotas that limited Jewish-American students in the early 20th century–you're a Deplorable.

Regardless of your ethnicity, class or religion, if you perceive the institutions that govern American life as corrupted, riddled with favoritism and spin or as broken, you're a Deplorable. If you question or resist the dominance of self-serving neoliberal elites, you're a Deplorable.

This isn't the elites' definition, of course, because resistance to their dominance can't be identified as the defining factor. If this truth were revealed, the various tribes of Deplorables might realize they have more in common than the corporate media will let on.

Though it was Hillary Clinton who made the Deplorables public, the elites of both parties share the same fear and loathing of anyone who questions or resists their control.

BONUS DEPLORABLE POINTS if you answer "yes": do you think being corralled into a remote holding pen reserved for "expressing free speech" (i.e. resisting the elites) is a mockery of the Bill of Rights? Bingo, you're a Deplorable.

via Tyler Durden

“This Is Stupid” – Pennsylvania Electors To Get Police Protection

While today’s Electoral College vote is not expected,  by most, to lead to any surprises, and Donald Trump will almost certainly be selected as the next president in a vote that is usually routine but takes place this year amid allegations of Russian hacking to try to influence the election, some states are not taking any chances and following last week’s report that Trump electors have seen a flurry of death threats, the Pittsburgh Post-Gazette reports that electors in Pennsylvania will have police protection as they cast their ballots on Monday.

One Pennsylvania elector, Ash Khare, told the Gazette that he receives thousands of emails a day trying to sway his vote.

“I’m a big boy,” said Khare, an India-born engineer and a longtime Republican from Warren County, who estimates he receives 3,000 to 5,000 emails, letters, and phone calls a day from as far away as France, Germany, and Australia. “But this is stupid. Nobody is standing up and telling these people, ‘Enough, knock it off.’ “

As a reminder, Pennsylvania allows its electors to vote for someone other than the candidate who won the state. 

The messages have escalated to death threats, and so the 20 electors will have state troopers escorting them to cast their votes Monday. 

As reported previously, GOP electors have been under pressure over the past month from anti-Trump groups to not vote for President-elect Donald Trump.

“I take my job as an elector very seriously, and in Pennsylvania, Donald Trump won,” said Mary Barket, a Northampton County resident and president of the Pennsylvania Federation of Republican Women. “So any argument thereafter, especially about the nature of him being a president, is not going to have an effect on me.” But she said she generally doesn’t open the messages.

“I don’t have the time, first of all,” she said. “Second of all, there’s really not much to be said that’s going to do anything to change my mind.”

Barket said she has been inundated with phone calls and emails and letters over the last month. Some tell her to read the Federalist Papers or express fear over Trump becoming the country’s commander-in-chief.

In interviews with the Gazette last week, a number of electors said there was no chance anyone will defect. “There is zero chance of that,” said elector Lawrence Tabas, a Philadelphia lawyer and general counsel for the state GOP. “If you want to place a bet on that in Vegas, you can make enough money to retire.”

Tabas said state officials this year gave out contact information for all 20 electors. In his case, that included his work and cell phones, his work email, and his home address. He can’t read every email or letter – and many of them have just been form letters with different signatories.

He said most of the conversations he’s had have been respectful. Others have veered off into what he would only call “nasty” territory. He would not give details. Khare said he received a letter from a 7-year-old describing his fear of Trump. Others have sent him photos of their families, saying they were worried about their future under a Trump presidency.

One woman called to tell him her husband had left the country. Another called him at 1 a.m., while he was in a deep sleep. He was also sent a copy of John F. Kennedy’s Profiles in Courage, which focuses on the careers of eight senators whom Kennedy felt had shown courage under “enormous pressure” from their parties and constituents.

Khare said he understood that the country is deeply divided and that emotions are running high, but said he was clear on where he stands.

“I will not change my mind,” he said.

One GOP elector in Michigan has received death threats as well.

* * *

Trump won 306 electoral votes on Election Day, crossing the 270 electoral vote threshold needed to clinch the presidency and surpassing Hillary Clinton’s 232 electoral votes. Monday’s results are expected to match those figures almost exactly. But thousands are expected to protest across the country as part of a long-shot effort to convince 37 GOP electors to cast their ballots for someone other than Trump.

While the frantic push to exert pressure on the Republican electors isn’t expected to change the outcome of Monday’s vote, it has put the Electoral College under a rare spotlight.

via Tyler Durden

John McCain Says Hacks That Embarrass Politicians Could ‘Destroy Democracy’

Yesterday on CNN’s State of the Union, John McCain warned that Russian hacking aimed at influencing the outcome of U.S. elections has the potential to “destroy democracy,” which seems like a pretty hysterical take on the dissemination of embarrassing emails in which Democratic insiders dissed Bernie Sanders and noted Hillary Clinton’s limitations as a candidate. Like Clinton, who last week described the email thefts as an attack on “our electoral system,” McCain conflates information that guides voters’ choices with the nullification of those choices.

The Arizona senator conceded that there is no evidence of direct Russian interference in the voting process and that it’s not clear whether electronic communications illegally obtained from computers used by the Democratic National Committee and John Podesta, Clinton’s campaign chairman, affected the results of the presidential contest. “I have seen no evidence that the voting machines were tampered with,” he said. “I have seen no evidence that the election would have been different.” Still, McCain said, “that doesn’t change the fact that the Russians…have been able to interfere with our electoral process.” And “if they are able to harm the electoral process, then they destroy democracy, which is based on free and fair elections.”

The problem is that one man’s interference with the electoral process is another man’s voter education. Leading news organizations concluded that much of the information revealed by the DNC and Podesta hacks, such as excerpts from Clinton’s highly paid but heretofore secret Wall Street speeches, concerned matters of legitimate public interest. As The New York Times put it, “Every major publication, including The Times, published multiple stories citing the D.N.C. and Podesta emails posted by WikiLeaks, becoming a de facto instrument of Russian intelligence.”

Valuable journalism, including journalism that helps voters decide which candidates to support, is often based on information that was obtained or divulged illegally by people with axes to grind. It is hard to see how this case is different in principle. Is it the nationality of the informants that matters? If the emails that made Clinton look bad had been swiped by Americans, would she and McCain still be talking about democracy-threatening interference with our electoral process?

During the campaign, The New York Times “obtained” parts of Donald Trump’s 1995 tax return and shared them with the public, building a series of stories on the information they contained. If that information had come from a foreign source, would publishing it have undermined democracy? Suppose German hackers had managed to obtain complete copies of Trump’s recent tax returns—a subject of intense journalistic interest—and shared them with news outlets, either directly or through an intermediary like Wikileaks. Would Clinton have perceived the resulting exposés as undermining the electoral process or assisting it?

Cybersecurity is obviously a real concern, and hacking in the service of voting fraud would be a genuine threat to the integrity of our elections. But computer trespassing that merely brings to light facts that politicians would rather conceal does not constitute a threat to democracy. To the contrary, it helps voters make better-informed choices.

from Hit & Run

Frontrunning: December 19

  • Electoral college expected to officially select Trump (Reuters)
  • China says discussing return of undersea drone with U.S. military (Reuters)
  • Neutral PBOC Sets Up First U.S.-China Tightening Since 2006 (BBG)
  • Wall St sleepwalking into Trump volatility surge (FT)
  • Ukraine’s largest bank rescued by state, prompts call for calm (Reuters)
  • U.S. Factories Are Working Again; Factory Workers, Not So Much (WSJ)
  • Senators call for probe of cyber attacks (Reuters)
  • Koch escalates tax reform battle with report on gasoline prices (Reuters)
  • As yuan weakens, Chinese rush to open foreign currency accounts (Reuters)
  • China house price growth slows as lending curbs take hold (FT)
  • Russia, Iran and Turkey to hold Syria talks in Moscow on Tuesday (Reuters)
  • Japan eyes record spending, less new debt in financial year 2017/18 budget (Reuters)
  • German Business Confidence Improves as Growth Strengthens (BBG)
  • Aramco IPO Could Still Be in U.S. as Kingdom Plays Down Rift (BBG)
  • Digital currency sales take off, but with no regulation questions abound (Reuters)
  • Danone Sales Growth to Miss Target as Spain, Activia Falter (BBG)
  • Bond Selloff Shows Risks of China’s Efforts to Restrain Credit (WSJ)
  • A $55 Billion Manager Who Bought at Market Low Returns to Cash (BBG)
  • Here’s how Obama can hit back at Putin over hacking (Reuters)


Overnight Media Digest


– Fresh signs emerged Sunday that President-elect Donald Trump could embrace the intelligence community’s view that the Russians were behind a computer-hacking operation aimed at influencing the November election. A senior Trump aide said Trump could accept Russia’s involvement if there is a unified presentation of evidence from the Federal Bureau of Investigation and other agencies.

– Iranian officials publicly hardened their resolve to proceed with a multibillion-dollar deal to buy dozens of Boeing Co jets, threatening to claw back any lost money if the deal is scuttled after the inauguration of Trump.

– Zsa Zsa Gabor, the jet-setting Hungarian actress and socialite who helped create a type of celebrity fame out of multiple marriages, conspicuous wealth and jaded wisdom about the glamorous life, has died. She was 99.

– Walt Disney Co’s “Rogue One: A Star Wars Story” hit blockbuster status with light speed at the box office this weekend, collecting an estimated $155 million in the U.S. and Canada.

– Libya’s National Oil has for now stopped the relaunch of production at oil fields in the country’s west, Libyan officials said Sunday, after a militia threatened to block the petroleum from reaching the market.

– Ireland said the European Union overstepped its authority and misinterpreted Irish law when it ordered the country in August to recoup $13.59 billion in allegedly unpaid taxes from Apple.

– Standard Industries on Sunday reached an agreement to acquire German roof maker Braas Monier Building Group SA after raising its offer in a deal that now values the sale at about $1.15 billion.

– Canada-based insurer Fairfax Financial Holdings Ltd has agreed to acquire Swiss peer Allied World Assurance Co in a $4.9 billion cash-and-share deal.



– Ireland laid out grounds for its appeal against the European Commission’s demand that it claw back 13 billion euros of state aid from Apple. It accused Brussels of interfering with national sovereignty.

– Personal care-to-forestry products group SCA, is nearing a deal to buy German bandage maker BSN Medical for 2.7 billion euros including debt, ahead of a plan to separate into two publicly traded parts next year.

– Praxair, the US industrial group, and Germany’s Linde are set to announce preliminary terms of their $65 billion merger as early as Wednesday in a deal that will create the world’s largest supplier of industrial gas.

– Impax Laboratories put a price tag of more than $800 on a pinworm treatment – 200 times more expensive than the equivalent medicine on British pharmacy shelves.



– Finland will soon hand out cash to 2,000 jobless people, free of bureaucracy or limits on side earnings. The idea, universal basic income, is gaining traction worldwide.

– Vine, the app owned by Twitter Inc, will not survive but a new, pared-down version in January will allow users to share short videos to that social network.

– David Yurman, the New York-based jewelry brand, is tapping into social philanthropy through a holiday advertising campaign.

– Snapchat is treating celebrities like everyday users, while most of the other social networking services court and elevate them.



The Times

– Apple is set for a fight with the European Commission over a ruling that it must pay the Republic of Ireland more than 13 billion euros in tax, describing parts of the judgment as having “no basis in law”. In submitting its formal appeal today against a ruling issued in August, the iPhone maker claims that the commission has misinterpreted both Irish and international law.

The Guardian

– Talks aimed at averting strikes by British Airways cabin crew over Christmas will be held on Monday. Unite union members based at Heathrow are due to walk out on Christmas Day and Boxing Day in a dispute over pay. The row involves about 4,500 “mixed fleet” cabin crew who have joined BA since 2010. Unite says they are on lower wages than other staff, referring to the amount that recently hired staff receive as “poverty pay”.

The Telegraph

– Britain’s science and technology industries are expected to lead another leap in hiring next year, in another vote of confidence in the economy following the Brexit vote, according to the Confederation of British Industry.

Sky News

– The largest shareholder in Formula One motor racing, CVC Capital Partners has launched an attempt to buy a slice of the insurer of pension schemes at Cadbury, Siemens and ICI.

– Employers see a gloomy picture for jobs over the next few years amid uncertainty over Brexit, a new poll has found. The CBI/Pertemps employment trends survey showed firms still expected to grow jobs next year but that their longer term confidence in the labour market had been shaken.

The Independent

– Lidl was alerted to the harmful effects of a paint thinner chemical found in its gravy granules more than two weeks before it issued a public recall. The supermarket has recalled two batches of Kania Gravy Granules found to contain xylene, which occurs naturally in petroleum and crude oil, the Food Standards Agency said.


via Tyler Durden