It is not a secret and it is not new that public hospitals in Greece collapsed. As Keep TalkingGreece.com notes, the first budget cuts imposed with the first bailout agreement affected the public health. Seven years later, the situation goes from bad to worse in fast speed. The austerity freezing of hiring (1:7) ended up in severe shortages in medical and paramedical personnel. The sharp expenditure cuts deprive hospitals of spare parts and essential material. KTG reported many times in the past about the situation in Greece’s hospitals, the deficiencies in personnel and material, incl bed sheets, the never ending bureaucracy.

Now doctors and workers at the public hospitals mention a new phenomenon: the increasing risk of death due to inner-hospital infections.

Speaking to UK’s Guardian about the Greek public health meltdown, doctors and personnel say that hospitals have become “danger zones”.

Alexis Tsipras’s austerity drive has seen hospitals become ‘danger zones’, doctors say, with many fearing worse is to come.

 

“In the name of tough fiscal targets, people who might otherwise survive are dying,” said Michalis Giannakos who heads the Panhellenic Federation of Public Hospital Employees. “Our hospitals have become danger zones.”

 

“Frequently, patients are placed on beds that have not been disinfected. Staff are so overworked they don’t have time to wash their hands and often there is no antiseptic soap anyway.”

The report speaks of “rising mortality rates, an increase in life-threatening infections and a shortage of staff and medical equipment are crippling Greece’s health system as the country’s dogged pursuit of austerity hammers the weakest in society”.

In the name of tough fiscal targets, people who might otherwise survive are dying,” said Michalis Giannakos who heads the Panhellenic Federation of Public Hospital Employees. “Our hospitals have become danger zones.”

Figures released by the European Centre for Disease Prevention and Control recently revealed that about 10% of patients in Greece were at risk of developing potentially fatal hospital infections, with an estimated 3,000 deaths attributed to them.

The occurrence rate was dramatically higher in intensive care units and neonatal wards, the body said. Although the data referred to outbreaks between 2011 and 2012 – the last official figures available – Giannakos said the problem had only got worse.

Like other medics who have worked in the Greek national health system since its establishment in 1983, the union chief blamed lack of personnel, inadequate sanitation and absence of cleaning products for the problems. Cutbacks had been exacerbated by overuse of antibiotics, he said.

“For every 40 patients there is just one nurse,” he said, mentioning the case of an otherwise healthy woman who died last month after a routine leg operation in a public hospital on Zakynthos. “Cuts are such that even in intensive care units we have lost 150 beds.”

via http://ift.tt/2iDoQak Tyler Durden

For months, if not years, we’ve warned that conflicted politicians and union bosses pursue a perverse set of goals in their management of pension funds, most of which have nothing to do with the application of sound financial principles. Here’s how we summarized the situation back in the summer (see “An Unsolvable Math Problem: Public Pensions Are Underfunded By As Much As $8 Trillion“):

Defined Benefit Pension Plans are, in many cases, a ponzi scheme.  Current assets are used to pay current claims in full in spite of insufficient funding to pay future liabilities… classic Ponzi.  But unlike wall street and corporate ponzi schemes no one goes to jail here because the establishment is complicit.  Everyone from government officials to union bosses are incentivized to maintain the status quo…public employees get to sleep better at night thinking they have a “retirement plan,” public legislators get to be re-elected by union membership while pretending their states are solvent and union bosses get to keep their jobs while hiding the truth from employees.

Then, just a couple of weeks ago, CalPERS confirmed our fears when they chose to lower their discount rate by only 50bps to 7%, nearly a full point above their 6.2% projected annual returns over the next decade.  Even more startling was the open admission from Richard Costigan, chairman of the CalPERS finance committee, that the decision was motivated by the board’s desire to maintain the ponzi, saying: “this is just a start…municipalities and other government agencies need some breathing room before they absorb the impact.”

Apparently we’re not the only ones growing increasingly concerned about the lack of financial discipline within these massive pension funds.  Lawrence Person’s BattleSwarm Blog recently interviewed the Director of the Texas Public Policy Foundation, James Quintero, who noted that many of the nation’s largest pensions are relying on “fuzzy math to make them work, or at least give the appearance of working.”

When it comes to Texas’ public retirement systems, one of my greatest concerns is that there are other ticking time-bombs, like the DPFP, out there getting ready to explode. It’s not just Dallas’ pension plan that’s taken on excessive risk to chase high yield in a low-yield environment.

 

Setting aside the issue of risk for a moment, the DPFP, like most other public retirement systems around the state, suffers from a fundamental design flaw. That is, it’s based on the defined benefit (DB) system, which guarantees retirees a lifetime of monthly income irrespective of whether the pension fund has the money to make good on its promises or not. This kind of system is akin to an entitlement program, warts and all, and is very much at the heart of pension crises brewing in Texas and across the country.

 

One of the biggest problems with DB plans is that they rely on a lot of fuzzy math to make them work, or at least give the appearance of working. Take the issue of investment returns, for example. Many systems assume an overly optimistic rate of return when estimating a fund’s future earnings. Baking in these rosy projections is, among other things, a way to understate a plan’s pension debt.

 

The common element in most, if not all, of these systemic failures is the defined benefit pension plan. Because of the political element as well as the inclusion of inaccurate investment assumptions in the DB model, these plans are almost destined to fail, threatening the taxpayers who support it and the retirees who rely on it. And sadly, that’s what we’re witnessing now across the nation.

Unfortunately, as Quinterro points out, when all those bad assumptions about future returns finally prove to be wildly optimistic it will be taxpayers left holding the bag.

Let me preface this by saying that I’m not a lawyer nor do I ever intend to be one. However, Article XVI, Section 66 of the Texas Constitution plainly states that non-statewide retirement systems, like DPFP, and political subdivisions, like the city of Dallas, “are jointly responsible for ensuring that benefits under this section are not reduced or otherwise impaired” for vested employees. Given that, it’s hard to see how the city of Dallas—or better yet, the Dallas taxpayer—isn’t obligated in some major way when their local retirement system reaches the point of no return, which may be a lot closer than people think given all the lump-sum withdrawals of late.

 Asked whether other large pensions in Texas were as bad off as the Dallas Police and Fire Pension, Quinterro said simply, “If you’re a taxpayer or property owner in one of Texas’ major cities, I’d be concerned.”

A quick review of where some of Texas’ largest pensions stand, after one of the biggest bull market runs in history, helps explain Quinterro’s pessimism:

While “fuzzy math” can help these ponzi schemes elude the inevitable for a very long time, at some point they will eventually collapse.  And, with $6-8 trillion in outstanding liabilities at U.S. public pensions alone, we suspect the consequences of that collapse will not be pleasant.

via http://ift.tt/2j3qWkv Tyler Durden

Via GEFIRA,

The rule of law is often invoked by as a Western value that “populist” movements want to destroy, yet the establishment’s own governments have long suspended that very same rule of law when it comes to immigration. The most evident example of this is the immigration policy started by the Italian Letta government in 2013 and continued since then under the Renzi government.

In October 2013, the Letta government, facing waves of refugees escaping the chaos of Western backed-Arab Spring in Libya, which later transpired as nothing more than insurgencies of Islamic radical groups, launched the operation “Mare Nostrum” or “Our Sea”, which consisted in the use of the Italian navy near Libyan waters to rescue asylum seekers from the African coast.

As noble as its motivation may be, a side effect of the operation was to encourage even more people to undertake sea travel because now they are certain that the Italian navy will rescue them. The result was a 224% increase in the number of boats leaving Libya, which translates into an average of almost 10 million euro a month for the Italian government.

In November 2014 Mare Nostrum was replaced with the EU-coordinated and funded Triton, covering a smaller part of the Mediterranean at the cost of 3 million euro a month. The official reason for the Triton operation is to control borders, however once we look at facts the goal of the operation is simply to bring in as many people as possible, regardless of whether they are refugees, economic migrants, legals or illegals. Since then, smuggling channels instead of being stopped have multiplied.
An established practice since the “Mare Nostrum” operation, continued under Triton, was for smugglers to launch a rescue signal to the patrolling navy and request assistance. In the meanwhile, NGOs pursuing the “open borders” have joined forces with them, assisting anyone, legal, illegal, refugee, who wants to reach Europe.

The European Commission that is responsible for Frontex, and what follows border controls, has a clear opinion on the matter. Commissioner for Home Affairs, Migration and Citizenship Dimitris Avramopoulos said: “Another important element that emerged strongly from the discussions on countering smuggling is that NGOs – and local and regional authorities – which provide assistance to smuggled migrants shall not be criminalised. I fully agree with this, of course, as I also agree on the need to protect the fundamental rights of those who are being smuggled. Those who we need to punish are the smugglers!”

Punishing the smugglers, unless they are part of NGOs, meaning the problem can’t and won’t be solved, because NGOs will always be free to smuggle migrants. This continues a well established tradition; during the Monti government in 2011-12 a Ministry for Immigration was created and given to Andrea Riccardi of the “Comunità of Sant’Egidio”, the prominent Italian open borders NGO. “Comunità of Sant’Egidio” runs projects such as “Humanitarian corridors”. The project funds an alternative route to bring people into Italy. Andrea Riccardi told the French media that he is convinced that Europe must open its borders. The Ministry was then given to Cecile Kyenge, a black woman born in the Democratic Republic of the Congo, who set herself a task of drastically reducing the requirements for acquiring Italian citizenship. She proposes a law that would give citizenship to the children of immigrants if they are born on Italian soil. Under Renzi, the ministry was reduced to a department within the ministry for Home Affairs, and handed to Mario Morcone, again affiliated with the “Comunità di Sant’Egidio”.

But what happens once migrants of all kinds reach Italian soil? They are sent to refugee centers, where they can apply for the status of refugees. It should be noted that Italy has long run out of places for asylum seekers, and so the government is paying hotels, hostels or citizens in general to take in people.

Here a common practice for those who know that their application will be rejected is to destroy their documents beforehand so that the time to identify them increases exponentially. Experience has shown that centers eventually become overcrowded, which turns out to be an occasion for migrants to riot, destroy properties and finally escape and become illegals. If they do not escape and their application is rejected, they are expelled. Expulsion however is voluntary and data shows that approximately only 50% of expelled migrants actually leave, probably to an other EU-Schengen country, the rest become illegals as well.

Moreover, as the “Mafia Capitale” scandal has shown, a collusion between members of the ruling Democratic Party controlling immigration-related institutions within the Italian state, including refugee centres, NGOs and the organized crime ensures that migrants are employed at the expense of Italian taxpayers and for insignificant hourly rates ensuring massive illegal profits for the racketeers. An infamous quote of a member of organized crime reveals how immigration is now a more profitable business than drug trafficking.

“Do you have any idea how much I make on these immigrants?” Salvatore Buzzi, a mafia affiliate says in a 1,200-page wiretap from early 2013. “Drug trafficking is not as profitable”. “We closed this year with a turnover of 40 million but… our profits all came from the gypsies (Roma people),on the housing emergency and on the immigrants,” Buzzi said. That was in 2013, when 20.000 immigrants arrived in Italy. In 2016, 180.000 immigrants arrived in Italy.

Corrupt politicians like Giuseppe Castiglione (NCD, partner of the ruling Democratic party), working for the Home Office, with the official mission of ”favouring the integration of those in need of international protection” in reality work to ensure profiteering from the crisis.

Illegal activities range from all levels; starting with the assignation of the construction of refugee centers to Democrat-related cooperatives in exchange for bribes; asylum seekers and illegals are then transferred to the Italian countryside and employed in the agricultural sector for an hourly rate between 1 and 3 euro.

When it comes to women, immigrants themselves organize prostitution rings within the refugee centers or sell them to work in the Italian streets.

Immigration, a tale of willingly lax enforcement of rule of law, smuggling, dishonesty, slavery and destroying Europe.

via http://ift.tt/2hMGhUO Tyler Durden

At its peak, the Roman Empire held up to 130 million people over a span of 1.5 million square miles. Rome had conquered much of the known world. The Empire built 50,000 miles of roads, as well as many aqueducts, amphitheatres, and other works that are still in use today. Our alphabet, calendar, languages, literature, and architecture borrow much from the Romans. Even concepts of Roman justice still stand tall, such as being “innocent until proven guilty”. And so, as Visual Capitalist's Jeff Desjardins asks (and answers): How could such a powerful empire collapse?

 

 

The Roman Economy

Trade was vital to Rome. It was trade that allowed a wide variety of goods to be imported into its borders: beef, grains, glassware, iron, lead, leather, marble, olive oil, perfumes, purple dye, silk, silver, spices, timber, tin and wine.

Trade generated vast wealth for the citizens of Rome. However, the city of Rome itself had only 1 million people, and costs kept rising as the empire became larger.

Administrative, logistical, and military costs kept adding up, and the Empire found creative new ways to pay for things.

Along with other factors, this led to hyperinflation, a fractured economy, localization of trade, heavy taxes, and a financial crisis that crippled Rome.

Roman Debasement

The major silver coin used during the first 220 years of the empire was the denarius.

This coin, between the size of a modern nickel and dime, was worth approximately a day’s wages for a skilled laborer or craftsman. During the first days of the Empire, these coins were of high purity, holding about 4.5 grams of pure silver.

However, with a finite supply of silver and gold entering the empire, Roman spending was limited by the amount of denarii that could be minted.

This made financing the pet-projects of emperors challenging. How was the newest war, thermae, palace, or circus to be paid for?

Roman officials found a way to work around this. By decreasing the purity of their coinage, they were able to make more “silver” coins with the same face value. With more coins in circulation, the government could spend more. And so, the content of silver dropped over the years.

By the time of Marcus Aurelius, the denarius was only about 75% silver. Caracalla tried a different method of debasement. He introduced the “double denarius”, which was worth 2x the denarius in face value. However, it had only the weight of 1.5 denarii. By the time of Gallienus, the coins had barely 5% silver. Each coin was a bronze core with a thin coating of silver. The shine quickly wore off to reveal the poor quality underneath.

The Consequences

The real effects of debasement took time to materialize.

Adding more coins of poorer quality into circulation did not help increase prosperity – it just transferred wealth away from the people, and it meant that more coins were needed to pay for goods and services.

At times, there was runaway inflation in the empire. For example, soldiers demanded far higher wages as the quality of coins diminished.

“Nobody should have any money but I, so that I may bestow it upon the soldiers.” – Caracalla, who raised soldiers pay by 50% near 210 AD.

By 265 AD, when there was only 0.5% silver left in a denarius, prices skyrocketed 1,000% across the Roman Empire.
Only barbarian mercenaries were to be paid in gold.

The Effects

With soaring logistical and admin costs and no precious metals left to plunder from enemies, the Romans levied more and more taxes against the people to sustain the Empire.

Hyperinflation, soaring taxes, and worthless money created a trifecta that dissolved much of Rome’s trade.
The economy was paralyzed.

By the end of the 3rd century, any trade that was left was mostly local, using inefficient barter methods instead of any meaningful medium of exchange.

The Collapse

During the crisis of the 3rd century (235-284 A.D), there may have been more than 50 emperors. Most of these were murdered, assassinated, or killed in battle.

The empire was in a free-for-all, and it split into three separate states.

Constant civil wars meant the Empire’s borders were vulnerable. Trade networks were disintegrated and such activities became too dangerous.

Barbarian invasions came in from every direction. Plague was rampant.

And so the Western Roman Empire would cease to exist by 476 A.D.

*  *  *

The Money Project is an ongoing collaboration between Visual Capitalist and Texas Precious Metals that seeks to use intuitive visualizations to explore the origins, nature, and use of money.

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Submitted by Mike Krieger via Liberty Blitzkrieg blog,

There is absolutely no upside to any conflict with Russia when it comes to 99.9% of us. The fact so many pundits, anonymous intelligence officials and Hillary Clinton cultists are encouraging such an outcome based on zero publicly available evidence that Russia hacked the DNC/John Podesta and provided it to Wikileaks for the purpose of electing Trump, should be seen as the gigantic red flag that it is. So what’s actually going on? As is so often the case, it is all about money and power.

The best and most concise article I have read thus far explaining the driving influences behind all the anti-Russia/Putin hysteria was written a couple of weeks ago by Robert Parry of Consortium News. The post is titled, Making Russia ‘The Enemy’, and here are some key excerpts:

The rising hysteria about Russia is best understood as fulfilling two needs for Official Washington: the Military Industrial Complex’s transitioning from the “war on terror” to a more lucrative “new cold war” – and blunting the threat that a President Trump poses to the neoconservative/liberal-interventionist foreign-policy establishment.

Indeed, this is primarily about a failed establishment trying to maintain power in the face of repeated public catastrophes and pervasive corruption.

By hyping the Russian “threat,” the neocons and their liberal-hawk sidekicks, who include much of the mainstream U.S. news media, can guarantee bigger military budgets from Congress. The hype also sets in motion a blocking maneuver to impinge on any significant change in direction for U.S. foreign policy under Trump…

 

All of this maneuvering also is delaying the Democratic Party’s self-examination into why it lost so many white working-class voters in normally Democratic strongholds, such as Pennsylvania, Michigan and Wisconsin.

 

Rather than national party leaders taking the blame for pre-selecting a very flawed candidate and ignoring all the warning signs about the public’s resistance to this establishment choice, Democrats have pointed fingers at almost everyone else – from FBI Director James Comey for briefly reviving Clinton’s email investigation, to third-party candidates who siphoned off votes, to the archaic Electoral College which negates the fact that Clinton did win the national popular vote – and now to the Russians.

 

Democrats now are excitedly joining the bash-Russia movement, making it harder to envision how the party can transition back into its more recent role as the “peace party” (at least relative to the extremely hawkish Republicans).

 

The potential trading places of the two parties in that regard – with Trump favoring geopolitical détente and the Democrats beating the drums for more military confrontations – augurs poorly for the Democrats regaining their political footing anytime soon.

 

If Democratic leaders press ahead, in alliance with neoconservative Republicans, on demands for escalating the New Cold War with Russia, they could precipitate a party split between Democratic hawks and doves, a schism that likely would have occurred if Clinton had been elected but now may happen anyway, albeit without the benefit of the party holding the White House.

 

The first test of this emerging Democratic-neocon alliance may come over Trump’s choice for Secretary of State, Exxon-Mobil’s chief executive Rex Tillerson, who doesn’t exhibit the visceral hatred of Russian President Vladimir Putin that Democrats are encouraging.

 

As an international business executive, Tillerson appears to share Trump’s real-politik take on the world, the idea that doing business with rivals makes more sense than conspiring to force “regime change” after “regime change.”

 

Over the past several decades, the “regime change” approach has been embraced by both neocons and liberal interventionists and has been implemented by both Republican and Democratic administrations. Sometimes, it’s done through war and other times through “color revolutions” – always under the idealistic guise of “democracy promotion” or “protecting human rights.”

 

But the problem with this neo-imperialist strategy has been that it has failed miserably to improve the lives of the people living in the “regime-changed” countries. Instead, it has spread chaos across wide swaths of the globe and has now even destabilized Europe.

 

Yet, the solution, as envisioned by the neocons and their liberal-hawk understudies, is simply to force more “regime change” medicine down the throats of the world’s population. The new “great” idea is to destabilize nuclear-armed Russia by making its economy scream and by funding as many anti-Putin elements as possible to create the nucleus for a “color revolution” in Moscow.

 

To justify that risky scheme, there has been a broad expansion of anti-Russian propaganda now being funded with tens of millions of dollars in taxpayer money as well as being pushed by government officials giving off-the-record briefings to mainstream media outlets.

 

However, as with earlier “regime change” plans, the neocons and liberal hawks never think through the scenario to the end. They always assume that everything is going to work out fine and some well-dressed “opposition leader” who has been to their think-tank conferences will simply ascend to the top job.

 

Remember, in Iraq, it was going to be Ahmed Chalabi who was beloved in Official Washington but broadly rejected by the Iraqi people. In Libya, there has been a parade of U.S.-approved “unity” leaders who have failed to pull that country together.

 

In Ukraine, Nuland’s choice – Arseniy “Yats is the guy” Yatsenyuk – resigned amid broad public disapproval  earlier this year after pushing through harsh cuts in social programs, even as the U.S.-backed regime officials in Kiev continued to plunder Ukraine’s treasury and misappropriate Western economic aid.

Robert goes on to describe his observations from a recent trip to Moscow, providing readers with an important lesson in “perception management,” which is just a fancy name for propaganda.

I also undertook a limited personal test regarding whether Russia is the police state that U.S. propaganda depicts, a country yearning to break free from the harsh grip of Vladimir Putin (although he registers 80 or so percent approval in polls).

 

During my trip last week to Europe, which included stops in Brussels and Copenhagen, I decided to take a side trip to Moscow, which I had never visited before. What I encountered was an impressive, surprisingly (to me at least) Westernized city with plenty of American and European franchises, including the ubiquitous McDonald’s and Starbucks. (Russians serve the Starbucks gingerbread latte with a small ginger cookie.)

 

Though senior Russian officials proved unwilling to meet with me, an American reporter, at this time of tensions, Russia had little appearance of a harshly repressive society. In my years covering U.S. policies in El Salvador in the 1980s and Haiti in the 1990s, I have experienced what police states look and feel like, where death squads dump bodies in the streets. That was not what I sensed in Moscow, just a modern city with people bustling about their business under early December snowfalls.

 

The police presence in Red Square near the Kremlin was not even as heavy-handed as it is near the government buildings of Washington. Instead, there was a pre-Christmas festive air to the brightly lit Red Square, featuring a large skating rink surrounded by small stands selling hot chocolate, toys, warm clothing and other goods.

 

Granted, my time and contact with Russians were limited – since I don’t speak Russian and most of them don’t speak English – but I was struck by the contrast between the grim images created by Western media and the Russia that I saw.

 

It reminded me of how President Ronald Reagan depicted Sandinista-ruled Nicaragua as a “totalitarian dungeon” with a militarized state ready to march on Texas, but what I found when I traveled to Managua was a third-world country still recovering from an earthquake and with a weak security structure despite the Contra war that Reagan had unleashed against Nicaragua.

 

In other words, “perception management” remains the guiding principle of how the U.S. government deals with the American people, scaring us with exaggerated tales of foreign threats and then manipulating our fears and our misperceptions.

 

As dangerous as that can be when we’re talking about Nicaragua or Iraq or Libya, the risks are exponentially higher regarding Russia. If the American people are stampeded into a New Cold War based more on myths than reality, the minimal cost could be the trillions of dollars diverted from domestic needs into the Military Industrial Complex. The far-greater cost could be some miscalculation by either side that could end life on the planet.

 

So, as the Democrats chart their future, they need to decide if they want to leapfrog the Republicans as America’s “war party” or whether they want to pull back from the escalation of tensions with Russia and start addressing the pressing needs of the American people.

Meanwhile, cybersecurity experts continue to throw cold water all over the Russia hacking story that is being swallowed whole by the billionaire-owned mainstream media with little to no skepticism.

In that regard, here are some excerpts from Robert Carr’s must read, FBI/DHS Joint Analysis Report: A Fatally Flawed Effort:

The FBI/DHS Joint Analysis Report (JAR) “Grizzly Steppe” was released yesterday as part of the White House’s response to alleged Russian government interference in the 2016 election process. It adds nothing to the call for evidence that the Russian government was responsible for hacking the DNC, the DCCC, the email accounts of Democratic party officials, or for delivering the content of those hacks to Wikileaks.

 

It merely listed every threat group ever reported on by a commercial cybersecurity company that is suspected of being Russian-made and lumped them under the heading of Russian Intelligence Services (RIS) without providing any supporting evidence that such a connection exists.

 

Unlike Crowdstrike, ESET doesn’t assign APT28/Fancy Bear/Sednit to a Russian Intelligence Service or anyone else for a very simple reason. Once malware is deployed, it is no longer under the control of the hacker who deployed it or the developer who created it. It can be reverse-engineered, copied, modified, shared and redeployed again and again by anyone. In other words?—?malware deployed is malware enjoyed!

 

If ESET could do it, so can others. It is both foolish and baseless to claim, as Crowdstrike does, that X-Agent is used solely by the Russian government when the source code is there for anyone to find and use at will.

 

If the White House had unclassified evidence that tied officials in the Russian government to the DNC attack, they would have presented it by now. The fact that they didn’t means either that the evidence doesn’t exist or that it is classified.

 

If it’s classified, an independent commission should review it because this entire assignment of blame against the Russian government is looking more and more like a domestic political operation run by the White House that relied heavily on questionable intelligence generated by a for-profit cybersecurity firm with a vested interest in selling “attribution-as-a-service”.

While we’re at it, Sharyl Attkisson provided some much needed additional perspective on the entire saga in her piece, Eight Facts on the “Russian Hacks,” where she notes:

4. It seems a difficult task to prove the hacks somehow “affected the election” or “helped Donald Trump win.” For example:

• One would have to show that tens of thousands of Trump voters were planning to vote for Clinton but changed their mind based solely on the WikiLeaks emails.

• One would have to believe the emails somehow managed to only affect the electoral vote but not the popular vote (which Clinton won).

• One would have to believe the emails somehow selectively swayed voters in key swing states, but not voters in states where Clinton won.

 

7. There have been many serious cyberattacks reported against U.S. government institutions, but no comparable news coverage or announced U.S. retaliatory measures. For example:

• In 2015, Russian hackers attacked the State Department email system in what was called the “worst ever” cyberattack against a federal agency.

• Also in 2015, the U.S. Office of Personnel Management reported 5.6 million Americans’ fingerprints were stolen in a malicious cyberattack.

• The GAO reports that between 2006 and 2015, the number of cyberattacks climbed 1,300 percent — from 5,500 to over 77,000 a year at 24 federal agencies.

• Last March, China government hackers continued a malicious pattern of cyber attacks on U.S. government and private networks, according to U.S. Cyber Command chief Mike Rogers. China has been linked by U.S. intelligence agencies to wide-ranging cyber attacks aimed at stealing information and mapping critical computer networks for future attacks in a crisis or conflict. 

 

Despite the Chinese hacking activity, the Obama administration has taken no action against China for years of large-scale cyber attacks that officials say have cost the nation billions of dollars in stolen intellectual property and compromised networks.

To conclude, I suppose my thoughts on the matter can be best summarized with the following tweet:

When World War 3 is on the line, "sources and methods" must be revealed.
Otherwise, don't make the claims.

— Michael Krieger (@LibertyBlitz) December 30, 2016

via http://ift.tt/2i4OktR Tyler Durden

Earlier today, we were surprised to note that having aggressively drained liquidity from the interbank funding market, on the first trading day of 2017, the PBOC not only fixed the Yuan well lower (sy 6.9498 vs 6.9370 on the last day of 2016, even if this was well stronger than the Offshore Yuan), but the People’s Bank of China withdrew even more liquidity. It did that by injecting CNY20 billion via 7-day reverse repos and another CNY20 billion via 14-day reverse repos in its open-market operations Tuesday, according to traders, while continuing to skip 28-day reverse repos.

The move resulted in a net drain of CNY155 billion for the day, and followed a substantial drain of a net CNY245 billion last week – the first removal of liquidity in three weeks. We promptly followed up with a warning:

PBOC drains a net CNY155 billion for the day. Keep an eye on overnight SHIBOR/ HIBOR/ Repo

— zerohedge (@zerohedge) January 3, 2017

Just over an hour later, it appears our warning was warranted, because according to the latest daily fixing of the Treasury Market Association, as a result of the PBOC’s massive liquidity drain which soaked up a nearly a third of a trillion Yuan in the past two weeks, the interbank market is freezing again as follows:

• 1-month yuan interbank rate in Hong Kong rises 1.16ppts to 13.01%,
• 3-month CNH Hibor +89bps to 10.02%;

• And most importantly, the overnight CNH Hibor rate has soared 4.95% to 17.76%, the highest since September

But wait, because the interbank market freezing was not all, and in a repeat of two weeks ago when China’s halted the trading of its government bond future, the Shanghai Stock Exchange announced that Shanghai halted trading of the 3.99% government bond due May 2065 after “abnormal fluctuations.”  It was not exactly clear what that particular phrase meant aside from “aggressive selling” as per the chart below.

According to a statement, trading was set to resume at 11:06 am after being halted at 10:36am, but not before the exchange called on investors to “remain rational and reminded them of trading risks.” In other words, please don’t sell, especially when the central bank just yanked a near record amount of liquidity from the market.

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Submitted by John Reed Stark via LinkedIn.com,

President-elect Donald Trump has recently questioned: 1) President Obama's finger pointing at the Russians for election-related cyberattacks; and 2) the current media and pundit frenzy alleging a Russian cyber-strike targeting Secretary Hillary Clinton in order to assure a Trump presidency. President-elect Trump plans to press U.S. intelligence agencies to defend their conclusions, stating,

“I know a lot about hacking. And hacking is a very hard thing to prove. So it could be somebody else. And I also know things that other people don’t know, and so they cannot be sure of the situation.”

Having worked since 1995 as a first-responder to cyber-attacks, including serving 11 years as Chief of the SEC's Office of Internet Enforcement, I whole-heartedly agree with President-elect Trump. His skepticism is not only appropriate and warranted — it's spot-on.

Official U.S. Statements About Russian Hacking of U.S. Election

Despite countless inflammatory headlines about Russian election hacking, there exist only two official U.S. statements specifically addressing the facts of recent election-related hacking incidents. The first is the October 7, 2016 Joint Statement from the Department of Homeland Security and Office of the Director of National Intelligence on Election Security (the "Joint Statement"). The second is the December 29, 2016 Joint Analysis Report of the Department of Homeland Security and the Federal Bureau of Investigation, entitled, "GRIZZLY STEPPE – Russian Malicious Cyber Activity" (the "JAR").

Both government statements are curt, vague, opaque and miles away from being concrete — and both also beg far more questions than answers.

The Joint Statement

The Joint Statement adopts a cautionary approach to any sort of attribution or motive behind who "directed the recent compromises of e-mails from U.S. persons and institutions, including from US political organizations." The Joint Statement states that the hacks:

“. . . are consistent with the methods and motivations of Russian-directed efforts. These thefts and disclosures are intended to interfere with the US election process. Such activity is not new to Moscow — the Russians have used similar tactics and techniques across Europe and Eurasia, for example, to influence public opinion there. We believe, based on the scope and sensitivity of these efforts, that only Russia’s senior-most officials could have authorized these activities.” 

Announcing that we think the hacks “are consistent with the methods and motivations of Russian-directed efforts” falls far short of a legitimate prosecutorial conclusion based upon actual evidence of Russian culpability and attribution. The Joint Statement's authors are clearly hedging their bets, which is exactly what any reasonable cyber-investigator would do under the circumstances.

After all, attributing disparate attack vectors to the same culprit is always speculative. The entire virtual criminal design could all be a ruse, where one country’s cyber gang coopts the techniques of another country’s cyber gang, to confuse or disassemble.

Moreover, even in its most favorable light, the Joint Statement does not support the conclusion that the Russians were trying to help Trump and hurt Hillary — as opposed to just doing what most hackers do i.e. rummaging voraciously and randomly through whatever data they can access, and leaving it to their patrons to determine what is, and is not, of use. 

Interfering with the election process is only one of many possible motives behind cyber-attacks. Financial crime, insider trading, intellectual property thievery, trade secret pilfering, extortion, ransomware, governmental disruption, market manipulation (just to name a few) are all potential goals at the outset of a hack.

Cyber-attackers invade systems and networks, frantically grab every data-file they can and then continue mounting their virtual crime sprees wherever that stolen data may lead them — disrupting organizations, causing damage and wreaking havoc all along the way. Make no mistake — the 21st Century hacker's mantra is to shoot first and ask questions later.

The JAR

Though more than half of the JAR is just a list of suggested preventive cybersecurity measures, the JAR is still an important report and a critical resource for any analysis of the Russian election rigging allegations — both for what it does say and for what it doesn't say. Here is a play-by-play of its deconstruction:

1. Attribution. The JAR is the first official government statement attributing certain politically-related malicious cyber activity to specific countries or threat actors, specifically, "to Russian government and civilian intelligent agencies."
2. The DNC Cyber-Attacks. The cyber-attacks upon the Democratic National Committee ("DNC") apparently began with a 2015 cyber-attack upon the U.S. government. This is typical of cyber-attacks — where the sole goal/motive is data exfiltration, leaving it until afterwards to determine how to take advantage of, or profit from, that exfiltrated data. Specifically, the JAR notes that in the summer of 2015, what looks like a Russian spear-phishing campaign targeting over 1,000 recipients, including U.S. government employees. Apparently, at least a few of these spear-phishing attacks hit pay dirt and in the course of that campaign, somehow "successfully compromised a "U.S. Political Party." (The JAR does not identify the "Political Party" to be the DNC.)
3. Multiple Attacks Continue." The JAR describes a second attack upon the same "U.S. Political Party," which occurred in the Spring of 2015 and states that, "Actors likely associated with [Russia] are continuing to engage in spear-phishing campaigns, including one launched as recently as November 2016, just days after the U.S. election."
4. APT Attacks. The JAR acknowledges the lengthy history of state-sponsored Advanced Persistent Threat or so-called APT attacks against every type of U.S. entity, including a range of foreign governments initiating "spear-phishing campaigns targeting government organizations, critical infrastructure entities, think tanks, universities, political organizations, and corporations." Given certain common indicators of compromise identified by the DHS and FBI, the JAR concludes that the perpetrators of the hacks upon the "U.S. Political Party" employed the same modus operandi used by purported Russian groups that have "historically targeted government organizations, think tanks, universities, and corporations around the world."
5. The Leaks of Exfiltrated Emails and Other Data. The JAR ambiguously and blithely states that, "The U.S. Government assesses that information was leaked to the press and publicly disclosed." The JAR (whether clumsily or intentionally) employs the passive voice to describe the leak — and does not state who leaked the information; how the information was leaked; or any other inculpatory details.
6. The Podesta Emails. The JAR does not address or infer that the attacks upon the "U.S. Political Party" were perpetrated by the same attackers who somehow obtained the emails of Clinton campaign head John Podesta. In fact, the JAR makes no specific mention of the Podesta hacks.
7. Trump Over Clinton. Like the Joint Statement, the JAR provides no evidence and makes no mention of any plot, effort or other scheme to steal the election from Hillary Clinton and favor Donald Trump. Rather, the JAR cites only the usual over-arching objective behind most state-sponsored APT attacks i.e. to disrupt and/or damage U.S. institutions and organizations.

Cybersecurity Experts Disagree (Often)

Like medical experts who disagree about a diagnosis or treatment, Cybersecurity experts are notorious for disagreeing about attribution conclusions gleaned from digital forensic remnants, residue, fragments and artifacts.

For instance, the firm investigating the DNC cyber-attacks, CrowdStrike, a highly reputable and well-respected data breach response firm, believes that "Fancy Bear," a hacking group with purported ties to the Russian government, likely orchestrated the DNC hack — and therefore the DNC hack was orchestrated by the Russians.

Like most digital forensic experts, CrowdStrike seems to have based its conclusions upon technological correlations and shared modus operandi of hacker techniques, a common investigative method employed by digital forensic investigators to identify online intruders. Along those lines, on December 22, 2017, the Washington Post reported that:

The firm CrowdStrike linked malware used in the DNC intrusion to malware used to hack and track an Android phone app used by the Ukrainian army in its battle against pro-Russia separatists in eastern Ukraine from late 2014 through 2016.

CrowdStrike found that a variant of the Fancy Bear malware that was used to penetrate the DNC’s network in April 2016 was also used to hack an Android app developed by the Ukrainian army to help artillery troops more efficiently train their antiquated howitzers on targets.

The Washington Post reports further details about Fancy Bear:

While CrowdStrike, which was hired by the DNC to investigate the intrusions and whose findings are described in a new report, had always suspected that one of the two hacker groups that struck the DNC was the GRU, Russia’s military intelligence agency, it had only medium confidence. Now, said CrowdStrike co-founder Dmitri Alperovitch, “we have high confidence” it was a unit of the GRU. CrowdStrike had dubbed that unit “Fancy Bear.”

However, other cybersecurity experts would disagree with CrowdStrike. Security researcher Jeffrey Carr recently pointed out that a 2014 FireEye report on Fancy Bear, which links Fancy Bear to the Russian government, has significant credibility issues:

'To my surprise, the report’s authors declared that they deliberately excluded evidence that didn’t support their judgment that the Russian government was responsible for [Fancy Bear’s] activities:

'[Fancy Bear] has targeted a variety of organizations that fall outside of the three themes we highlighted above. However, we are not profiling all of [Fancy Bear’s] targets with the same detail because they are not particularly indicative of a specific sponsor’s interests.” (emphasis added)

That is the very definition of confirmation bias. Had FireEye published a detailed picture of Fancy Bear’s activities including all of their known targets, other theories regarding this group could have emerged; for example, that the malware developers and the operators of that malware were not the same or even necessarily affiliated.

The notion that [Fancy Bear] has a narrow focus on U.S. political targets is also undermined in a SecureWorks research paper, which shows that the [Fancy Bear] hackers have a wide variety of interests: 10 percent of their targets are nongovernment organizations, 22 percent are journalists, 4 percent are aerospace researchers, and 8 percent are within the “government's supply chain.” SecureWorks concludes that only 8 percent of Fancy Bear’s targets are “government personnel” of any nationality.

According to Carr, “it’s an old assumption going back years to when any attack against a non-financial target was attributed to a state actor.” Without that premise, the only logical conclusion is that some email accounts at the DNC appear to have been broken into by someone, and perhaps they speak Russian. Left ignored is the mammoth difference between Russians and Russia.

Some experts even go so far as to pit themselves directly against the JAR. Take famed data security pioneer John McAfee, the developer of the first commercial antivirus program. McAfee has been a major player in the cybersecurity industry for the past 50 years and does not believe that the Russians were behind the hacks on the DNC, John Podesta’s emails and the Hillary Clinton presidential campaign.

McAfee notes that the JAR contains an appendix that lists hundreds of IP addresses that were supposedly “used by Russian civilian and military intelligence services,” but notes that,

"While some of those IP addresses are from Russia, the majority are from all over the world, which means that the hackers constantly faked their location . . . if it looks like the Russians did it, then I can guarantee you it was not the Russians . . . [The JAR] is a fallacy . . . hackers can fake their location, their language, and any markers that could lead back to them. Any hacker who had the skills to hack into the DNC would also be able to hide their tracks . . ."

The entire election hacking activities could also be some sort of "false flag" operation by someone else with extremely deep pockets and a political agenda. Along these lines, McAfee derides recent investigative techniques behind conclusions of Russian attribution, stating:

"If I was the Chinese and I wanted to make it look like the Russians did it, I would use Russian language within the code, I would use Russian techniques of breaking into the organization . . . in the end, there simply is no way to assign a source for any attack.”

Meanwhile, WikiLeaks' founder Julian Assange has insisted that the Russian government is not the source of the Podesta and DNC e-mails, implying that the source is instead a disgruntled DNC or other Democratic operative. 

Fancy Bear, What will You Wear

What does the public know for certain about Fancy Bear, or any of its other dozen names assigned by researchers such as APT 28, Tsar Team, Sofacy, Strontium and Pawn Storm? Not much.

Despite being one of the most reported-on groups of active hackers, there is very little any researcher can say with absolute certainty about Fancy Bear. No one knows, for instance, how many hackers are working regularly within Fancy Bear, or how they organize their hacking squads. No one even knows if Fancy Bear is based in one city or scattered in various locations across Russia or the world. They don’t even know what they call themselves.

No confirmed Fancy Bear hacker has ever actually gotten caught. Fancy Bear has evolved into a modern-day bogeyman — powerful and ubiquitous, nowhere and everywhere.

A Quick Review of Reported Digital Forensic Evidence (in Plain English)

Some of the cited circumstantial digital evidence relating to the DNC hacks while important and useful, also raises some fairly obvious caveats and questions, including:

• The attacker or attackers registered a deliberately misspelled domain name used for email phishing attacks against DNC employees, connected to an IP address associated with Fancy Bear. (But aren't misspelled domains a cornerstone of phishing attacks all over the world?);
• The actual clock times of the phishing schemes correlated with "business hours" in Russia and St. Petersburg time zones. (But couldn't Russian hackers just as easily orchestrate their schemes from a different time zone or digitally forge time-stamps? Also, don't hackers notoriously work at all hours of the day and night from any location they prefer?);
• Malware found on the DNC computers was programmed to communicate with an IP address associated with Fancy Bear. (But would a sophisticated state sponsor of cyber-attacks be so incompetent as to use an IP address tracing back to their homeland?);
• The DCLeaks.com domain was registered by a person using the same email service as the person who registered a misspelled domain used to send phishing emails to DNC employees. (But are the poor spelling habits of foreign spies truly evidence of their culpability and motive?);
• Based on some sort of linguistic analysis, experts believe that Guccifer 2.0, the purported Romanian hacker who loudly and boldly claimed responsibility for the DNC hacks, was actually a Russian agent, posing as a Romanian in order to cover up Russian's own hack and spread disinformation. (But other experts disagree, including M.J. Connolly, a professor of Slavic and Eastern European linguistics at Boston College, who says that many of Guccifer 2.0’s language traits are not Russian and that Guccifer 2.0 was more likely Moldovan. Whatever the origins of Guccifer 2.0, isn't this evidence better suited for a Robert Ludlum spy novel or bad episode of The Americans, rather than a bona-fide government intelligence conclusion?)
• The code in malware and tools of the DNC hacks appears to have been regularly and professionally updated and maintained while utilizing a sophisticated platform, suggesting a Russian operation funded to provide long-term data espionage and information warfare capabilities. (But isn't it common practice for hacking coders to update their software and tool kits as defenses change i.e. isn't that a prerequisite for all kinds of successful hacking?)
• Metadata in a file leaked by “Guccifer 2.0″ shows it was modified by a user called, “Felix Edmundovich,” a reference to the founder of a Soviet-era secret police force. Another document contained Cyrillic metadata indicating it had been edited on a document with Russian language settings. (But is this how a sophisticated government spy ring behaves — sloppily leaving behind blatant, inculpatory evidence in plain view?);
• Spear-phishing, the original hacking method used against the DNC, is the same method Fancy Bear uses to initiate its hacking operations. (But spear-phishing is used in some form by just about every hacking group, because it is proven to be the most effective way to inject malware on to a network in order to obtain command and control capabilities.)
• Some of the phishing emails were sent using Yandex, a Moscow-based webmail provider, which indicates Russian involvement. (But Yandex is the Russian equivalent of Google — is its use in the DNC hack truly that compelling?); and
• A bit.ly link believed to have been used by Fancy Bear in the past was also used in the spear-phishing scheme that purportedly tricked John Podesta into giving up his Gmail password. (But does Fancy Bear own some sort of criminal patent on their malware, so other hackers cannot ever use their tools and techniques?)

Final Thoughts

It is now widely accepted that despite government claims to the contrary: 1) Saddam Hussein was never building weapons of mass destruction (as initially asserted by the Bush Administration); and 2) the Benghazi embassy attack was not because of a YouTube video (as initially asserted by the Obama administration). Whether based upon sophisticated guesswork, concrete intelligence sources or a little of both, experts in each U.S. administration simply got it wrong.  

Let's also not be naive. Recalibrating raw intelligence data for political purposes has always been tempting for Republicans and Democrats alike. Even if made entirely in good faith, political and ideological motives undoubtedly lurked in the shadows of the WMD and Benghazi intelligence findings.

In the end, the Obama administration may be right about the Russians cyber-attack of election-related organizations. Russian-sponsored cyber-terrorism and data thievery is a major global problem — and has been for years. Indeed, legions of soldiers from countries across the globe, including Russian cyber-troops, wake up each morning with the sole objective to break into American computer systems and steal data.

But for the time being, given the inherent subjectivity of intelligence regarding cyber-attacks and the differing interpretations of malware reverse engineering and other circumstantial digital evidence, a healthy dose of skepticism about Russian attribution still makes sense.

As to whether the Russians somehow cyber-hijacked the election from Hillary Clinton to prop up Donald Trump — that is a completely different story. There is not a scintilla of official government evidence to support such an outrageous claim. It is a wholly unsubstantiated theory and my take is that mere skepticism is not enough. Flat out rejection may be in order.

Under any circumstance, President-elect Donald Trump is quite right to engage in his own de novo review of government intelligence analytics regarding Russian hacking. It is what Americans expect every Commander-in-Chief to do before making major foreign policy decisions and escalating military tensions. In fact, President-elect Trump's approach is not only smart, courageous, logical and scientific — it is above all else, highly presidential.

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This article by David Haggith was first published on The Great Recession Blog:

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It won’t be the first time Julian Assange was interviewed and asked whether the source of the hacked DNC and Podesta emails was Russia; however, it will be the first time everyone pays attention to his answer. Recall that the first such interview of Assange – when the question of who had sourced Wikileaks with the hacked emails came up – took place exactly two months ago, on November 3. Back then, in an interview televized by RT, John Pilger explicitly asked Asange where the emails in question had come from.

Assange’s response was straightforward: “The Clinton camp has been able to project a neo-McCarthyist hysteria that Russia is responsible for everything. Hillary Clinton has stated multiple times, falsely, that 17 US intelligence agencies had assessed that Russia was the source of our publications. That’s false – we can say that the Russian government is not the source.”

That particular interview took place when Trump has losing badly in the polls, and as such few people paid attention: after all, what difference did it make who had leaked the Podesta emails: Hillary Clinton was assured to win (with a 90%+ probability according to the NYT and other “non-fake news” outlets).

Needless to say, the issue of Russian hacking has since come back with a vengeance, and culminated last week with Obama expelling 35 Russian diplomats in the greatest diplomatic escalation between the US and Russia in decades; an action which took place based on a flimsy 13-page DHS/FBI report which demonstrated that anyone could have hacked the DNC emails if only they spent a few dollars to purchase a piece of Ukranian PHP malware.

Which is why many more will pay attention to Assange’s next interview with Sean Hannity, which will air Tuesday on Fox News. According to a Fox News release, the two will discuss Russian hacking, the 2016 presidential election, and both the Obama and upcoming Trump administrations. It will air at 10 p.m. on Jan. 3, with additional portions of the interview airing throughout the week. As Variety adds, The interview will mark Assange’s first face-to-face cable news appearance. It is not, however, the first time he’s spoken publicly to Hannity. Most recently, in December, Assange called into Hannity’s radio show, in which the host gushed to Assange that “you’ve done us a favor” in exposing gaps in U.S. cybersecurity.

And while what Assange would say was rather predictable, as he would simply reiterate what he has said previously, courtesy of Real Clear Politics, we have an advance glimpse into the punchline, to wit:

HANNITY: Can you say to the American people, unequivocally, that you did not get this information about the DNC, John Podesta’s emails, can you tell the American people 1,000 percent that you did not get it from Russia or anybody associated with Russia?

 

ASSANGE: Yes. We can say, we have said, repeatedly that over the last two months that our source is not the Russian government and it is not a state party… Obama is trying to say that President-elect Trump is not a legitimate President.

However, as we said previously, since at the end of the day it is Assange’s word – unless Wikileaks does actually reveal its source, which would be professional suicide – against the word of Obama and 17 agenices who back him up, despite still having provided no actual evidence in the ongoing, and quite bizarre attempt to force a deterioration of US-Russian relations in the final days of the Obama administration, just so Trump can inherit a complete diplomatic mess and make closer relations with Putin more complicated, this latest interview with Assange will likewise resolve absolutely nothing.

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