Month: July 2017

Via Jesse's Cafe Americain blog,

History may not repeat… but it sure ryhmes…

"…people believed that everything was going to be great always, always. There was a feeling of optimism in the air that you cannot even describe today."

"There was great hope. America came out of World War I with the economy intact. We were the only strong country in the world. The dollar was king. We had a very popular president in the middle of the decade, Calvin Coolidge, and an even more popular one elected in 1928, Herbert Hoover. So things looked pretty good."

"The economy was changing in this new America. It was the dawn of the consumer revolution. New inventions, mass marketing, factories turning out amazing products like radios, rayon, air conditioners, underarm deodorant…One of the most wondrous inventions of the age was consumer credit. Before 1920, the average worker couldn't borrow money. By 1929, "buy now, pay later" had become a way of life."

"Wall Street got the credit for this prosperity and Wall Street was dominated by just a small group of wealthy men. Rarely in the history of this nation had so much raw power been concentrated in the hands of a few businessmen…"

"One of the most common tactics was to manipulate the price of a particular stock, a stock like Radio Corporation of America…Wealthy investors would pool their money in a secret agreement to buy a stock, inflate its price and then sell it to an unsuspecting public. Most stocks in the 1920s were regularly manipulated by insiders "

"I would say that practically all the financial journals were on the take. This includes reporters for The Wall Street Journal, The New York Times, The Herald-Tribune, you name it. So if you were a pool operator, you'd call your friend at The Times and say, "Look, Charlie, there's an envelope waiting for you here and we think that perhaps you should write something nice about RCA." And Charlie would write something nice about RCA. A publicity man called A. Newton Plummer had canceled checks from practically every major journalist in New York City… Then, they would begin to — what was called "painting the tape" and they would make the stock look exciting. They would trade among themselves and you'd see these big prints on RCA and people will say, "Oh, it looks as though that stock is being accumulated. Now, if they are behind it, you want to join them, so you go out and you buy stock also. Now, what's happening is the stock goes from 10 to 15 to 20 and now, it's at 20 and you start buying, other people start buying at 30, 40. The original group, the pool, they've stopped buying. They're selling you the stock. It's now 50 and they're out of it. And what happens, of course, is the stock collapses."

"The pools were a little like musical chairs. When the music stopped, somebody owned the stocks and those were the sufferers. If small investors suffered, they would soon be back for more. They knew the game was rigged, but maybe next time, they could beat the system. Wall Street had its critics, among them economist Roger Babson. He questioned the boom and was accused of lack of patriotism, of selling America short."

"Roger Babson warned of the speculation and said, "There's going to be a crash and the aftermath is going to be quite terrible." And people jumped on Babson from all around for saying such a thing, so that people who were cautious about their personal reputation, who did not want to call down on themselves a lot of calumny, kept quiet."

"Politicians came and went, but in the 20s, the businessman was king."

"With everyone trying to borrow money to cover the falling value of their stocks, there was a credit crunch. Interest rates soared. At 20 percent, few people could afford to borrow more money. The boom was about to collapse like a house of cards."

"…the National City Bank would provide $25 million of credit…immediately, the credit crisis was alleviated. In fact, within the next 24 hours, call money went from 20 percent to eight percent and that stopped the panic, then, in March [1929]"

"Everything was not fine that spring with the American economy. It was showing ominous signs of trouble. Steel production was declining. The construction industry was sluggish. Car sales dropped. Customers were getting harder to find. And because of easy credit, many people were deeply in debt. Large sections of the population were poor and getting poorer."

"Just as Wall Street had reflected a steady growth in the economy throughout most of the 20s, it would seem that now the market should reflect the economic slowdown. Instead, it soared to record heights. Stock prices no longer had anything to do with company profits, the economy or anything else. The speculative boom had acquired a momentum of its own."

"It was this nature of mass illusion. Prices were going up, people bought. That forced prices up further, that brought in more people. And eventually, the process becomes self-perpetuating. Every increase brings in more people convinced of their God-given right to get rich."

"The 20s was a decade of all sorts of fast money schemes. Three years earlier, everyone was buying Florida real estate. As prices of land skyrocketed, more people jumped in, hoping to make a killing. Then, overnight, the boom turned to bust and investors lost everything."

"On September 5th, economist Roger Babson gave a speech to a group of businessmen. 'Sooner or later, a crash is coming and it may be terrific.' He'd been saying the same thing for two years, but now, for some reason, investors were listening. The market took a severe dip. They called it the "Babson Break." The next day, prices stabilized, but several days later, they began to drift lower. Though investors had no way of knowing it, the collapse had already begun."

"…the market fluctuated wildly up and down. On September 12th, prices dropped ten percent. They dipped sharply again on the 20th. Stock markets around the world were falling, too. Then, on September 25th, the market suddenly rallied."

"Reuben L. Cain, Stock Salesman, 1929: I remember well that I thought, "Why is this doing this?" And then I thought, "Well, I'm new here and these people" — like every day in the paper, Charlie Mitchell would have something to say, the J.P. Morgan people would have something to say about how good things were — and I thought, "Well, they know a lot more about this market than I do. I'm fairly new here and I really can't see why it's going up." But then, when they say it can't go down or if it does go down today, it'll go back tomorrow, you think, "Well, they really are like God. They know it all and it must be the way it's going because they say so."

"As the market floundered, financial leaders were as optimistic as ever, more so. Just five days before the crash, Thomas Lamont, acting head of the highly conservative Morgan Bank, wrote a letter to President Hoover. "The future appears brilliant. Our securities are the most desirable in the world."

"Practically every business leader in American and banker, right around the time of 1929, was saying how wonderful things were and the economy had only one way to go and that was up."

"There came a Wednesday, October 23rd, when the market was a little shaky, weak. And whether this caused some spread of pessimism, one doesn't know. It certainly led a lot of people to think they should get out. And so, Thursday, October the 24th — the first Black Thursday — the market, beginning in the morning, took a terrific tumble. The market opened in an absolutely free fall and some people couldn't even get any bids for their shares and it was wild panic. And an ugly crowd gathered outside the stock exchange and it was described as making weird and threatening noises. It was, indeed, one of the worst days that had ever been seen down there."

"There was a glimmer of hope on Black Thursday…About 12:30, there was an announcement that this group of bankers would make available a very substantial sum to ease the credit stringency and support the market. And right after that, Dick Whitney made his famous walk across the floor of the New York Stock Exchange…. At 1:30 in the afternoon, at the height of the panic, he strolled across the floor and in a loud, clear voice, ordered 10,000 shares of U.S. Steel at a price considerably higher than the last bid. He then went from post to post, shouting buy orders for key stocks."

"And sure enough, this seemed to be evidence that the bankers had moved in to end the panic. And they did end it for that day. The market then stabilized and even went up."

"But Monday was not good. Apparently, people had thought about things over the weekend, over Sunday, and decided maybe they might be safer to get out. And then came the real crash, which was on Tuesday, when the market went down and down and down, without seeming limit…Morgan's bankers could no longer stem the tide. It was like trying to stop Niagara Falls. Everyone wanted to sell."

"In brokers' offices across the country, the small investors — the tailors, the grocers, the secretaries — stared at the moving ticker in numb silence. Hope of an easy retirement, the new home, their children's education, everything was gone."

"At the end of 1929, as they celebrated New Year's Eve, all that lay in the future. Nobody knew that the Great Depression was coming — unemployment, bread lines, bank failures — this was unimaginable. But the bubble had burst. Gone was that innocent optimism, the confidence, the illusion of wealth without work. One era had ended. They toasted the coming of the 30s, but somewhere, deep down, they knew the party was over."

via http://ift.tt/2t7wMFc Tyler Durden

Authored by Mac Slavo via SHTFplan.com,

Robert Kiyosaki is the well known author of the widely popular Rich Dad, Poor Dad series. As an outside-the-box thinker Kiyosaki has recently suggested that the U.S. economy is under so much pressure that it is in real danger of collapse. He is also a long-time advocate of gold and silver as a way to protect wealth during times of financial calamity. Kiyosaki happens to be a very good friend of President Donald Trump, with whom he has written two books.

In the following interview with Infowars.com, he says that America is not only in serious trouble because of a poor education system, corrupt bureaucrats and socialist-leaning government employees, but that entrenched Deep State elites are feverishly working to take down the President.

In dealing with Donald… he’s straight… he listens… he makes decision quickly…

 

And I think that’s his Achilles heel… You know, because bureaucrats, all they want is to keep their jobs… they’re not here to get the job done.

 

So I feel for my friend Donald… he is a great man.. he has the same disease I have… foot and mouth… or Tweet and mouth…

 

I’m so politically incorrect… that’s what he is… it’s so unfortunate… everybody says ‘well, stop Tweeting.”

 

Well, it’s Donald… People look at that covfefe he Tweeted… but at the same time he went to NATO and he said to NATO, “pay up… you guys are not paying your bills.”

Then he went to Saudi Arabia and said “let’s kick ISIS’ butt.”

 

That’s the kind of leader he is… but the press never covers that…

 

…

 

Our whole system is suspect right now… it’s all these bureaucrats and people with their hands in pockets… why does a politician go into office poor and leave rich?

 

How does it happen? That’s corruption… but nobody says anything about that.

 

…

 

My concern for my friend the President… they are going to find something… it doesn’t make a difference what they find… they will find something.

Just this week we learned that Democrats in Congress, reportedly with the support of some Republicans, are spearheading a new law that would create an “Oversight Commission on Presidential Capacity.” The committee would be a bi-partisan panel designed specifically to investigate President Trump’s mental health and to oust him under the 25th Amendment of the U.S. Constitution. Considering that non-conformity has now been identified by psychiatrists as a mental disorder, it should be clear, as Robert Kiyosaki warns, that finding a reason, any reason, to get rid of Trump would be a fairly straightforward process with the right people involved in the investigations.

Coupled with a variety of investigations and accusations involving everything from Russian collusion to alleged blackmailing of MSNBC hosts Joe Scarborough and Mika Brzezinski about an Enquirer article, if the Deep State wants to find something, they absolutely will.

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

As the oppressive regime of leftist autocrat Nicolas Maduro intensifies its crackdown on anti-government protesters who have been gathering daily in the streets of Caracas and other Venezuelan cities to demand regime change, the government’s body count continues to climb. Last week, one such government-sanctioned killing was caught on video. The chilling footage shows Venezuelan soldiers shooting a 22-year-old rioter in the chest after he hurled rocks at them.

The Associated Press reports that at least four people were killed and eight injured during anti-government protests in central Venezuela on Saturday. The deaths brought to at least 80 the number of people killed since anti-government protests erupted three months ago.

“Chief prosecutor Luis Ortega Diaz confirmed that four deaths occurred Friday in clashes in Barquisimeto. The city’s mayor blamed the deaths on armed militias that support Venezuela’s socialist government.”

The deaths occurred as Ortega Diaz  – who has had the temerity to stand up to Maduro and question his late-March decision to dissolve the opposition-controlled National Assembly – asked the Inter-American Commission on Human Rights for protection Friday, days after Venezuela’s Supreme Court barred her from leaving the country and ordered her bank accounts froze, according to the Associated Press.

Ortega Diaz is one of the few remaining Maduro critics who haven’t already been removed from power, challenging Maduro’s push to rewrite the constitution and pressing charges against officers responsible for deaths during anti-government protests.

Her latest crime? Her office announced this past week that it would summon the chief of Venezuela’s feared Sebin intelligence agency, Gustavo Gonzalez, to appear on suspicion of “committing grave and systemic violations of human rights.”

Maduro responded to Ortega Diaz’s decision by promoting Gonzalez to head of the nation’s army.

Here’s more on that from the AP:

Prosecutors said they are investigating incidents of illegitimate detentions, arbitrary raids and cases in which people have remained imprisoned despite court orders that they be freed.

 

Maduro responded hours later by promoting Gonzalez to head the nation’s army. He called Gonzalez and Antonio Benavides Torres, another high-ranking official under investigation by the state prosecutor, “brave patriots.”

 

“They have defended the peace of the republic and have all my support,” Maduro said.

Maduro has tightened his grip on power and cracked down on his political opposition as the collapse in oil prices – the Venezuelan government’s primary source of revenue – coupled with years of economic mismanagement by Maduro precipitated an unprecedented economic crisis in the country. The collapse of Venezuela’s currency, the bolivar, which trades on the black market at a rate of nearly 8,000 to the dollar, triggered hyperinflation that has made bare essentials like flour, meat, medicine and toilet paper unavailable to the general population.

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

Authored by Kai-Fu Lee, originally posted at The New York Times,

What worries you about the coming world of artificial intelligence?

Too often the answer to this question resembles the plot of a sci-fi thriller. People worry that developments in A.I. will bring about the “singularity” — that point in history when A.I. surpasses human intelligence, leading to an unimaginable revolution in human affairs. Or they wonder whether instead of our controlling artificial intelligence, it will control us, turning us, in effect, into cyborgs.

These are interesting issues to contemplate, but they are not pressing. They concern situations that may not arise for hundreds of years, if ever. At the moment, there is no known path from our best A.I. tools (like the Google computer program that recently beat the world’s best player of the game of Go) to “general” A.I. — self-aware computer programs that can engage in common-sense reasoning, attain knowledge in multiple domains, feel, express and understand emotions and so on.

This doesn’t mean we have nothing to worry about. On the contrary, the A.I. products that now exist are improving faster than most people realize and promise to radically transform our world, not always for the better. They are only tools, not a competing form of intelligence. But they will reshape what work means and how wealth is created, leading to unprecedented economic inequalities and even altering the global balance of power.

It is imperative that we turn our attention to these imminent challenges.

What is artificial intelligence today? Roughly speaking, it’s technology that takes in huge amounts of information from a specific domain (say, loan repayment histories) and uses it to make a decision in a specific case (whether to give an individual a loan) in the service of a specified goal (maximizing profits for the lender). Think of a spreadsheet on steroids, trained on big data. These tools can outperform human beings at a given task.

This kind of A.I. is spreading to thousands of domains (not just loans), and as it does, it will eliminate many jobs. Bank tellers, customer service representatives, telemarketers, stock and bond traders, even paralegals and radiologists will gradually be replaced by such software. Over time this technology will come to control semiautonomous and autonomous hardware like self-driving cars and robots, displacing factory workers, construction workers, drivers, delivery workers and many others.

Unlike the Industrial Revolution and the computer revolution, the A.I. revolution is not taking certain jobs (artisans, personal assistants who use paper and typewriters) and replacing them with other jobs (assembly-line workers, personal assistants conversant with computers). Instead, it is poised to bring about a wide-scale decimation of jobs — mostly lower-paying jobs, but some higher-paying ones, too.

This transformation will result in enormous profits for the companies that develop A.I., as well as for the companies that adopt it. Imagine how much money a company like Uber would make if it used only robot drivers. Imagine the profits if Apple could manufacture its products without human labor. Imagine the gains to a loan company that could issue 30 million loans a year with virtually no human involvement. (As it happens, my venture capital firm has invested in just such a loan company.)

We are thus facing two developments that do not sit easily together: enormous wealth concentrated in relatively few hands and enormous numbers of people out of work. What is to be done?

Part of the answer will involve educating or retraining people in tasks A.I. tools aren’t good at. Artificial intelligence is poorly suited for jobs involving creativity, planning and “cross-domain” thinking — for example, the work of a trial lawyer. But these skills are typically required by high-paying jobs that may be hard to retrain displaced workers to do. More promising are lower-paying jobs involving the “people skills” that A.I. lacks: social workers, bartenders, concierges — professions requiring nuanced human interaction. But here, too, there is a problem: How many bartenders does a society really need?

The solution to the problem of mass unemployment, I suspect, will involve “service jobs of love.” These are jobs that A.I. cannot do, that society needs and that give people a sense of purpose. Examples include accompanying an older person to visit a doctor, mentoring at an orphanage and serving as a sponsor at Alcoholics Anonymous — or, potentially soon, Virtual Reality Anonymous (for those addicted to their parallel lives in computer-generated simulations). The volunteer service jobs of today, in other words, may turn into the real jobs of the future.

Other volunteer jobs may be higher-paying and professional, such as compassionate medical service providers who serve as the “human interface” for A.I. programs that diagnose cancer. In all cases, people will be able to choose to work fewer hours than they do now.

Who will pay for these jobs? Here is where the enormous wealth concentrated in relatively few hands comes in. It strikes me as unavoidable that large chunks of the money created by A.I. will have to be transferred to those whose jobs have been displaced. This seems feasible only through Keynesian policies of increased government spending, presumably raised through taxation on wealthy companies.

As for what form that social welfare would take, I would argue for a conditional universal basic income: welfare offered to those who have a financial need, on the condition they either show an effort to receive training that would make them employable or commit to a certain number of hours of “service of love” voluntarism.

To fund this, tax rates will have to be high. The government will not only have to subsidize most people’s lives and work; it will also have to compensate for the loss of individual tax revenue previously collected from employed individuals.

This leads to the final and perhaps most consequential challenge of A.I. The Keynesian approach I have sketched out may be feasible in the United States and China, which will have enough successful A.I. businesses to fund welfare initiatives via taxes. But what about other countries?

They face two insurmountable problems. First, most of the money being made from artificial intelligence will go to the United States and China. A.I. is an industry in which strength begets strength: The more data you have, the better your product; the better your product, the more data you can collect; the more data you can collect, the more talent you can attract; the more talent you can attract, the better your product. It’s a virtuous circle, and the United States and China have already amassed the talent, market share and data to set it in motion.

For example, the Chinese speech-recognition company iFlytek and several Chinese face-recognition companies such as Megvii and SenseTime have become industry leaders, as measured by market capitalization. The United States is spearheading the development of autonomous vehicles, led by companies like Google, Tesla and Uber. As for the consumer internet market, seven American or Chinese companies — Google, Facebook, Microsoft, Amazon, Baidu, Alibaba and Tencent — are making extensive use of A.I. and expanding operations to other countries, essentially owning those A.I. markets. It seems American businesses will dominate in developed markets and some developing markets, while Chinese companies will win in most developing markets.

The other challenge for many countries that are not China or the United States is that their populations are increasing, especially in the developing world. While a large, growing population can be an economic asset (as in China and India in recent decades), in the age of A.I. it will be an economic liability because it will comprise mostly displaced workers, not productive ones.

So if most countries will not be able to tax ultra-profitable A.I. companies to subsidize their workers, what options will they have? I foresee only one: Unless they wish to plunge their people into poverty, they will be forced to negotiate with whichever country supplies most of their A.I. software — China or the United States — to essentially become that country’s economic dependent, taking in welfare subsidies in exchange for letting the “parent” nation’s A.I. companies continue to profit from the dependent country’s users. Such economic arrangements would reshape today’s geopolitical alliances.

One way or another, we are going to have to start thinking about how to minimize the looming A.I.-fueled gap between the haves and the have-nots, both within and between nations. Or to put the matter more optimistically: A.I. is presenting us with an opportunity to rethink economic inequality on a global scale. These challenges are too far-ranging in their effects for any nation to isolate itself from the rest of the world.

via http://ift.tt/2swxM76 Tyler Durden

According to a new study from Pew Research which polled 40,000 people in 37 nations, Donald Trump's presidency has had a "major impact on how the world sees the United States".

You will find more statistics at Statista

As Statista's Niall McCarthy notes, three quarters of those polled had little to no faith in the U.S. president doing the right thing for world affairs compared to an unimpressive 22 percent who have a great deal of confidence in him. Broken down on a country by country basis, majorities of respondents in Israel and Russia were confident about Trump's leadership abilities but nearly every other nation displayed a high degree of skepticism.

Across the board, Obama's perfomance on the world stage is generally held in higher regard than Trump's. People were polled at the end of Obama's eight-year term and 88 percent of Germans, 83 percent of Canadians and 79 percent of people in the UK were satisfied with his global leadership.

When asked about Trump's presidency, on the other hand, only 11 percent of Germans and 22 percent of those in Canada and the UK had faith in his global leadership.

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A shootout erupted around 10:30pm on Sunday night in Avignon, southern France, when two gunmen opened fire on a crowd outside the Arrahma mosque leaving either people injured, La Provence newspaper reports.

Gunmen open fire on crowd outside mosque in France leaving eight injured – Mirror Online https://t.co/dLQ6GMVRpA

— Tommy Robinson ???????? (@TRobinsonNewEra) July 2, 2017

According to initial reports, two hooded men were seen arriving aboard a Renault Clio. One was armed with a handgun, the second a rifle. As a crowd oe people were leaving the mosque, one of the armed men, who had got out of his vehicle, opened fire.

La Provence adds that at least four people were injured at the time, while subseqeuent reports said the number is at least eight. About fifty meters away, a family of four who was in her apartment on the second floor of a building also received shrapnel. A 7-year-old girl was slightly injured.

Police in Avignon are now searching for the suspects who fled the scene.

The police have said they do not suspect terrorism is a motive behind the attack. The permanent magistrate at the Avignon parquet, Laure Chabaud, said the working hypothesis is a settling of accounts or a quarrel between young people.

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By Chris at http://ift.tt/12YmHT5

Most of you know the story of Africa’s great jewel.

Zimbabwe, presided over by the charming, charismatic, democratically elected leader Robert Mugabe.

So great is the country that under his leadership it has reached dizzying heights. The highest inflation in Africa, the highest unemployment in Africa, and, of course, the highest rates of poverty, which on the dark continent is really quite something.

Think about it, your neighbouring nations are themselves doing such a sterling job of raping and pillaging the populace and destroying wealth even before its past incubation point that in order to beat them you’d be forced to work so hard you’d probably have to quit drinking on the job.

It was under this backdrop that in late 2009 I, together with a bunch of mining engineers from South Africa and some ex-military gents, sensed opportunity.

You see, Zim had been running a government program which released its white citizens of the cumbersome obligations of ownership of all sorts of assets – things like farms, factories, land, and mines. And THIS was what we were interested in – gold mines to be precise. Many, but not all, of these assets had landed up in the hands of Mugabe’s henchmen. Many “whities” with a strongly held desire to keep their heads attached to their shoulders while simultaneously being mad as hell realising that all they’d worked for was to go to some illiterate thug with a panga and an IQ of 70 essentially had two options.

A small number actually took to a scorched earth policy. They sold what they could and destroyed everything they’d worked for as they were unwilling to see it go to thieves.

Others went the legal route of transferring land titles to blacks. In doing so, they got to choose the new land owners and so typically handed the assets over to longtime loyal employees, farm managers, mine managers, and so forth. The assets, now in the hands of black Zimbabweans, were that much safer from roaming thugs targeting white owned assets. The previous owners (those who could) fled to wherever they could. Amazingly, even previously war torn Mozambique received an influx of white talent though many went to Europe or South Africa. Pretty much anywhere looked better. Some had no options (no foreign passports) and either died or still eek out a living in the country today.

What’s the Liquidity on an Asset No Sane Person Would Want?

That’s the question we asked ourselves… figuring it to be near zero.

As a white non-Zimbabwean citizen (actually white Zim citizens were and are in the same boat) you really didn’t want to “own” these assets. You wanted to control them but you sure as hell didn’t want to own them.

The black guys who ended up with the assets couldn’t quite figure this out, the mindset being that they now had gone from having few assets to owning massive operations which were only a few years prior worth tens or hundreds of millions of dollars. So they just wanted to cash in and sell them.

It’s worth mentioning that most of these poor guys had no financial acumen at all, and when we explained to them that we placed the assets in the liability column on the balance sheet (they needed to be maintained, which costs money) we drew blank stares. A balance sheet wasn’t something they knew too much about but when it sunk in that we believed the assets to be worthless unless we could go through an extraction of product, they realised that they’d have to go back to work (producing on a revenue share) they weren’t overjoyed. Visions of big houses, Land Cruisers, and holidays in Europe seemed further out of reach.

Those assets in Zimbabwe can’t be easily bought or sold due to Mugabe and his minions creating all sorts of headaches requiring copious bottles of Klipdrift (a South African brandy) and a certain amount of hard currency changing hands with “officials”. That’s if they don’t just simply take what they want outright. The impact on liquidity of assets is typically like that of a safe being dropped on your guts. Oofff!

Now, this is where it gets interesting.

Liquidity should have been zero. After all, what white guy would want to buy something that could and probably would be stolen from under him within a few years, if not months, and could quite easily involve the removal of his head from his shoulders?

But It Wasn’t…

Enter some other gents going by the names of Ivan, Anatoly, and Vsevolod.

These guys descended on Zimbabwe in waves. Perhaps there was a flyer in Moscow. Our own “soldier of fortune” explained to us where these guys came from and even some of their history, which was fascinating to me since he knew so much from just watching them across a table at a restaurant.

Any dope could see they were well dressed thugs who could snap you in two without taking their attention off their lunch but it turns out that tattoos reveal a lot. Apparently when you leave the employ of the KGB or Spetznaz your employment options are somewhat limited. Mercenary work in 3rd world hell holes looks and pays a lot better than licking stamps at the post office and smiling at Babushkas.

Anyway, the Russkies, after enjoying the collapse of the Soviet Union had a template on how to deal with such opportunities. You roll into town, use overwhelming muscle, and secure assets, then strip them and sell them. Hey, it worked in the ex-USSR, so why not Zim?

Indeed, why not?

Ivan and his mates were working for whatever “brains” had employed them, and they actually just went in and paid cash for all sorts of stuff. No need for any limbs to get snapped. This, as it turns out, was an excellent example of a truly terrible idea, and Ivan and most of his buddies have since departed, their tails between their legs. A few still hold onto assets (because nobody will buy them) which they paid waaaay too much for and to which their particular “skillsets” are not well suited.

It became patently clear that these guys firstly had money to burn (presumably “acquired” by conducting other “business”)and didn’t seem to have a plan as to what to do once they’d bought the new assets. Clearly they wanted to just sell them on, and in the beginning, many “Ivans” approached our group with this in mind. Perhaps not giving thought to why on earth we, for our part, would pay a premium price on an asset which would could just as easily have bought (and indeed passed on) ourselves.

The point here is that even though liquidity of the assets should have been rock bottom it wasn’t… yet.

There is a solution here to all of this which we found, though it still had liquidity issues. How do you go about creating value in such a setup? The ultimate answer I think lies in code. Yup, computer code.

Now, keep that story in mind because later this week, I’ll explain to you another weird thing that happened in Mugabe’s paradise. Both of these are important due to an entirely new technology that you’ve probably heard about but perhaps haven’t given much thought to.

– Chris

“Focus on the movement of liquidity… most people in the market are looking for earnings and conventional measures. It’s liquidity that moves markets.” — Stanley Druckenmiller

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via http://ift.tt/2t6Iekm Capitalist Exploits

Just days before Trump’s meeting with the Chinese president in Hamburg later this week for the G-20 summit, the Trump administration sent a guided-missile destroyer near Triton Island in the South China Sea, Bloomberg reported, a move “which may cause concern ahead of President Donald Trump’s meeting with his Chinese counterpart.”

According to an anonymous official cited by Bloomberg, the U.S. Navy sent the destroyer USS Stethem within 12 nautical miles (22 kilometers) of Triton Island on Sunday, passing through the contested waters on the basis of “innocent passage.” 

The Arleigh Burke-class guided-missile destroyer USS Stethem

It was the second such operation conducted by the US during Donald Trump’s presidency. On May 24, the US Navy guided-missile destroyer, the USS Dewey, came within 12 miles of the Mischief Reef in the Spratly Islands, another disputed archipelago that lies in the southern part of the South China Sea. At that time, the Chinese Defense Ministry also sent two frigates to “warn off” the US vessel and said that it was “firmly opposed to the US behavior of showing force and boosting regional militarization.”

The news of the US ship deployment to the contested area comes just days after reports suggest China has completed construction of new missile shelters on Mischief and Fiery Cross reefs.

The sea patrol move could signal that the U.S. is displeased with China based on the extent of its efforts to pressure North Korea to curb its missile and nuclear programs. The White House has made several moves in recent weeks, including announcing economic sanctions against Chinese companies with ties to North Korea.

And while in recent weeks China has shown remarkable restraint in not responding, or retaliating, to US escalations today Beijing finally reacted instantly and with “outrage” with People’s Daily reporting that China deployed military vessels and warplanes to “warn off” the USS Stethem, according to Chinese Foreign Ministry spokesperson Lu Kang.

“Under the pretext of ‘freedom of navigation,’ the US side once again sent a military vessel into China’s territorial waters off the Xisha Islands without China’s approval,” the spokesperson said in a statement, adding that such US behavior “has violated the Chinese law and relevant international law, infringed upon China’s sovereignty, disrupted peace, security and order of the relevant waters and put in jeopardy the facilities and personnel on the Chinese islands, and thus constitutes a serious political and military provocation.”

“The Chinese side is dissatisfied with and opposed to the relevant behavior of the US side,” Lu added.

Escalating matter further, China’s foreign ministry also accused the US of “deliberatrely stirring up troubles” in the contested waters and warned Washington to “immediately stop such kind of provocative operations that violate China’s sovereignty.”

 “Working together, China and ASEAN member states have cooled down and improved the situation in the #SouthChinaSea. The US, who deliberately stirs up troubles in the South China Sea, is running in the opposite direction from countries in the region who aspire for stability, cooperation and development,” Lu added.

 

“The Chinese side strongly urges the US side to immediately stop such kind of provocative operations that violate China’s sovereignty and threaten China’s security. The Chinese side will continue to take all necessary means to defend national sovereignty and security,” the statement reads.

The head of US Pacific Command, Admiral Harry Harris, recently criticized China’s activity in the region. “China is using its military and economic power to erode the rules-based international order,” he said in a speech delivered on Wednesday in Brisbane during the joint US-Australian military exercises.

“Fake islands should not be believed by real people,” he added, as reported by Fox News.

* * *

The Paracel Islands, of which Triton is a member, are contested by China, Taiwan and Vietnam.  China has already built runways, aircraft hangars, radar sites and hardened surface-to-air missile shelters on its artificially-created islands in the region, according to photos analyzed by the Washington-based Center for Strategic and International Studies (CSIS).

Beijing’s actions have sparked concerns in Washington and the US Navy, which is fiercely opposed to this Chinese initiative, has deployed additional warships in the disputed zone, conducted maneuvers near China’s artificial islands, and flown over them, claiming it has been done in the interest of the “freedom of navigation.” In response, China called Washington’s involvement in the dispute the “greatest” threat to the region.

In early June, China and the US both held exercises involving air and navy forces, in another episode of confrontation over the disputed South China Sea. The US sent two B-1B Lancer supersonic bombers to fly a 10-hour mission from Andersen Air Force Base, Guam, which was conducted in conjunction with the US Navy’s Arleigh Burke-class guided-missile destroyer the USS Sterett.

A day earlier, the Chinese People’s Liberation Army (PLA) conducted its own air and navy exercise off Hong Kong. The patrol mission involved three helicopters and two Type 056 corvettes, the Qinzhou and the Huizhou, the Defense Ministry reported.

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The State of Delaware just took a historic step toward ensuring that US stock exchanges will soon be violently disrupted by blockchain technology – possibly to the extent of being rendered obsolete. CoinDesk reports that lawmakers in the state’s general assembly passed a law that makes explicit the right to trade stocks on a blockchain. Details of the bill are still emerging. One source indicated that the bill passed with near unanimity, with a single vote against. The vote was widely considered to be the final obstacle to state adoption, following the passage of the bill in the Senate earlier this month. The measure, which was added to another bill in the form of an amendment, is expected to be signed in to law by Delaware Gov. John Carney by the end of the month, with the ruling going into effect on Aug. 1.

Developed under the close guidance of blockchain lawyer Marco Santori of Cooley LLP and Caitlin Long of blockchain startup Symbiont, the bill is expected to pave the way for potentially large-scale issuance of stock on a blockchain. By trading stock on a blockchain or similar distributed ledgers, users can cut out middlemen like the exchanges and ATSs that profit by facilitating trades, resulting in significantly faster settlement times. The bill was introduced last year by the previous governor, Jack Markell, following requests made by multiple companies for the legislation – which was already lenient to blockchain stocks – to make explicit the legality of such issuances, according to CoinDesk’s sources.

“This is big for Delaware,” Symbiont’s Long told CoinDesk, further explaining the potential benefits of the amendments:”

Chair of the corporate law section of the Delaware bar association, Matthew O’Toole, told CoinDesk he expects the state’s governor, John Carney, to sign the bill into law by the end of July, with an effective date of 1st August.

In an email to CoinDesk, O’Toole said the vote “keeps Delaware at the forefront of corporate law and in the lead in terms of enabling the use of ‘distributed ledger shares’.” He added: “We look forward to helping Delaware corporations enjoy the benefits of this innovative new amalgamation of law and technology.”

Blockchain-based trading systems are inching closer to becoming a reality. Two years ago, Nasdaq OMX Group said it would use blockchain technology to power trading in shares of privately held companies on its Nasdaq Private Market platform. The company said at the time that private-share trading was particularly ripe for disruption because of the heavy volume of paperwork involved in recording and settling the transactions. Assuming Carney signs the bill, like CoinDesk expects, the measure should pave the way for US companies – many of which are legally based in the state – to begin listing shares on blockchain-based distributed ledgers. One source told CD that the bill “keeps Delaware at the forefront of corporate law and in the lead in terms of enabling the use of ‘distributed ledger shares’.”

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On Sunday Japanese PM Shinzo Abe’s Liberal Democratic Party suffered what Reuters called a “historic defeat” in the Tokyo assembly election, losing to an upstart outfit in an vote that is seen as a harbinger for Japan’s national elections, and signaling trouble ahead for the premier who has suffered from slumping support after a series of political scandals.

“We must recognize this as an historic defeat,” former defense minister Shigeru Ishiba was quoted by NHK as saying. “Rather than a victory for Tokyo Citizens First, this is a defeat for the LDP,” said Ishiba, who is widely seen as an Abe rival within the ruling party.

“We must accept the results humbly,” said Hakubun Shimomura, a close Abe ally and head of the LDP’s Tokyo chapter. “The voters have handed down an extremely severe verdict.”

According to Bloomberg, the ruling LDP party was projected to win its lowest number of seats ever in the capital, a crushing blow for Abe, which sent the USDJPY sliding after suddenly the very fate of Abenomics is in question, as past Tokyo elections have been bellwethers for national trends. A 2009 Tokyo poll in which the LDP won just 38 seats was followed by its defeat in a general election that year, although this time no lower house poll need be held until late 2018.

Tokyo Governor and head of Tokyo Citizens First party Yuriko Koike

As Reuters adds, the Tokyo Metropolitan assembly election was a referendum on Governor Yuriko Koike’s year in office, but the dismal showing for Abe’s party is also a stinging rebuke of his 4-1/2-year-old administration. Koike’s Tokyo Citizens First party and its allies were on track for between 73 to 85 seats in the 127-seat assembly, according to NHK TV exit polls. Later vote counts showed the LDP was certain to post its worst-ever result, winning at most 37 seats compared with 57 before the election, NHK said, while Koike’s party and allies were assured a majority.

Koike, a media-savvy ex-defense minister and former LDP member, took office a year ago as the first female governor in the capital, defying the local LDP chapter to run and promising to reform governance of a megacity with a population of 13.7 million and an economy bigger than Holland’s.

 

Among her allies is the Komeito party, the LDP’s national coalition partner.

 

“I am excited but at the same time, I am also keenly aware of the weight of my responsibility,” Koike told NHK, adding the results had exceeded her expectations.

It was not immediately clear how the LDP’s loss would alter Japan’s political landscape: according to Japanese press, the strong showing by Koike’s party will fuel speculation that she will make a bid for the nation’s top job, though that may not be until after the 2020 Tokyo Olympics. It could also widen cracks between the LDP and the Komeito while damaging prospects for the opposition Democratic Party.

What is more troubling for the Yen and global capital markets, is that Abe’s rivals in his party could be encouraged by the LDP’s dismal performance to challenge him in a leadership race in September 2018, victory in which would set Abe on course to become Japan’s longest-serving leader and bolster his hopes of revising the post-war, pacifist constitution.

Meanwhile, according to Gerry Curtis, professor emeritus at Columbia University, Japan’s political landscape could be set for a shake-up.

“We may discover that Japan is not all that different from Britain, France, and the U.S. in its ability to produce a big political surprise,” he said, referring to recent elections in those countries.

 

The LDP’s thrashing could also make it harder for Abe to pursue his cherished goal of revising the U.S.-drafted constitution’s pacifist Article 9 by 2020, a politically divisive agenda, said Sophia University professor Koichi Nakano.

 

“His prime motive to stay in power is his desire to revise the constitution, but once his popularity really starts to fall, that becomes very difficult to do,” Nakano said.

Having been hit by a wave of favoritism scandals in recent months, Abe’s the most recent troubles center on concern he may have intervened to help Kake Gakuen (Kake Educational Institution), whose director, Kotaro Kake, is a friend, win approval for a veterinary school in a special economic zone. As noted here previously, Abe got in trouble because the government has not granted such an approval in decades due to a perceived glut of veterinarians. Abe and his aides have denied doing Kake any favors.

But potentially more devastating – according to Reuters  – is “the impression among many voters that Abe and his inner circle have grown arrogant.” Perhaps it is because instructing your central banker to monetize all your GDP in debt, and boost the stock market takes some serious skills?

Meanwhile, the scapegoating process is being prepared: Abe is expected to reshuffle his cabinet in coming months in an effort to repair his damaged ratings, a step often taken by beleaguered leaders but one that can backfired if novice ministers become embroiled in scandals or commit gaffes. Among those many political insiders expect to be replaced is Defense Minister Tomomi Inada. Inada’s remark during the Tokyo campaign seeking voter support in the name of the Self-Defense Forces, as the military is known, came under heavy fire. By law, the military is required to be politically neutral.

In a kneejerk response, the USD/JPY fell as much as 0.4% to 111.90 in early Asia trading Monday in the wake of the shock loss.

The reason why suddenly Japan’s political process may go under the microscope, is that if indeed the LDP and Abe are in trouble, then the future of the BOJ’s QQE (with Yield Control) are in question. This is a problem because as Deutsche Bank reported late on Friday, “[our model] highlights the relative importance of BoJ purchases to Fed and ECB. For a 100 bn in annualized purchases of each, the BoJ has been associated with a 15 bps decline in term premium, almost twice the impact of either the Fed or the ECB. While the market is rightly concerned about the extent and timing of ECB taper, the BoJ is potentially much more important to the rate outlook as it was in the middle of last year.”

With everyone expecting a political black swan to emerge out of Europe at the start of the year – only for all concerns to be laid to rest by the summer – could the source of 2017’s true political shock end up being Japan?

Shinzo Abe shouts ‘Banzai!’ with members of the ruling Liberal Democratic Party
during the annual party convention in Tokyo

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