Month: September 2017

As we’ve discussed frequently over the past several years, home prices in some of Australia’s largest markets have gone completely vertical since 2013 as wealthy Chinese buyers have increasingly sought safe havens outside of the mainland to launder invest their cash.  Per the chart below, home prices in Melbourne have more than tripled since 2002 and Sydney is almost as bad.

Not surprisingly, the bubbly home prices have angered locals, not only because they’ve been priced out of the market by foreign buyers, but more so because those foreign buyers scoop up prime real estate and then proceed to let it sit vacant.  The problem is so pervasive that these luxury towers, with apartments approaching $1 million, have been dubbed “ghost towers” by locals.  Per Bloomberg:

These “ghost towers,” as the high-end residential property with three-bedroom apartments costing almost $1 million have been dubbed, are popular with Chinese investors who mostly live abroad. Their darkened blocks loom as sparsely occupied symbols of a property market where even solidly middle class households have increasingly found themselves priced out.

 

Now, policy makers are seizing on public resentment and hitting foreign buyers with more taxes. New South Wales has doubled its surcharge when foreigners purchase residential property, and Western Australia has added a new tax as well. More controversially, both the conservative federal government and the left-leaning one in Victoria state that includes Melbourne this year imposed additional taxes on properties deemed to be empty for six months or more.

 

More than 60 percent of Sydney residents blame foreign investment for the rising prices, according to a survey by University of Sydney academic Dallas Rogers. The idea of taking prime real estate out of the housing supply and leaving it vacant has become a focus of anger as homelessness has risen and hundreds of people have been camping in the rough out outside places like the Reserve Bank of Australia.

 

“It’s just absurd,” said Tony Keenan, chief executive officer of affordability advocacy group Launch Housing, referring to the fact that Australia’s long period of uninterrupted growth should have ensured homes for everyone instead of “record levels of homeless and massive construction with empty properties at the end.”

 

An analysis of Australian census data by the City Futures Research Centre found more than one in 10 homes unoccupied on the night of the count last year, with empty properties having risen 19 percent in Melbourne and 15 percent in Sydney since the last census five years previously.

 

Foreigners, mainly from China, purchased 25 percent and 16 percent of the new housing supply in New South Wales and Victoria, respectively, in the year through September 2016, according to a Credit Suisse Group AG examination of state tax receipts.

But, much like Vancouver where city officials slapped foreign nationals with a 15% transfer tax on home purchases last summer, the city of Melbourne has decided to fight back by imposing its own taxes to curb what increasingly looks like one of the world’s largest housing bubbles.

Melbourne’s tax of 1 percent of an empty home’s value takes effect in January, adding to a nationwide tax imposed in May that starts at A$5,500 ($4,400) and scales sharply upward for properties worth more than A$1 million.

 

Figuring out if a home is vacant is a vexing subject for public officials. Those in Victoria have said they plan to ask owners to self-declare, and also intend to monitor electricity and water usage to find cheaters. The Australian Taxation Office suggests the government investigate tips from informants. Other potential sources could include postal data or tax returns, said Catherine Cashmore, president of land tax reform group Prosper.

 

But real estate professionals say it’s easy enough to hire someone to come in and turn on switches and taps, making a place appear lived-in. Agents say many properties are only temporarily empty, waiting for children to attend university or a family to able to move in. They also raise questions of fairness.

Of course, not everyone is happy with the new taxes, including Monika Tu who has undoubtedly made a fortune helping rich Chinese buyers launder money through the Australian real estate market.

“What next?” said Monika Tu, the Sydney-based director of Black Diamondz, which specializes in high end property sales to mainly Chinese buyers. “Shall we tax people who buy new shoes and don’t wear them?’’

Sorry, Monika…you can always move to Seattle…we hear they’re still very receptive to helping launder Chinese cash…

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Authored by Alex Thomas via SHTFplan.com,

In yet another example of obvious disinformation being pushed by the establishment media, noted liar and MSNBC host Brian Williams took to the airwaves Wednesday to complain about the presidents use of the word “sovereignty” before interviewing a former CIA operative who declared that the literal idea of putting ones country first somehow “plays into Putin’s playbook”.

Responding to President Trump’s repeated use of the word sovereign and sovereignty during his recent United Nations speech, Williams worried if this was a dog whistle signal to the liberal world order that the United States was no longer looking to world governing bodies for guidance.

“Back to this use of the words sovereign and sovereignty,” Williams said as he spoke to mainstream media reporter Anita Kumar.  

 

“Did you hear a buzzword or a dog whistle in his repeated use of that world?”

“You know it caused me to go back through and count how many times and so he used that word sovereign or sovereignty 21 times,” a clearly triggered Kumar stated.

 

“It was definitely the word.”

Pretending not to know what the word sovereignty means, Williams than asked his guest who in turn was only to happy to take shots at the entire idea of putting ones own country first.

“It just means what he was talking about from the beginning which is America first, we’re going to go it alone,” Kumar laughably claimed before moving into the heart of the real reason that the establishment doesn’t want America put first. (Hint: They actually care more about the United Nations than America itself)

 

“That really undermines to me the UN which is where he was today, NATO, EU places like that. International bodies he was really saying, don’t matter as much anymore,” Kumar continued.

Apparently in leftist insanity land Trump is the bad guy because he is directly going up against the very international bodies that the American people voted against in the 2016 election.

Amazingly, this wasn’t the only open propaganda during the segment, as Williams also turned to former Chief of State for the DOD and the CIA under the Obama administration Jeremy Bash who openly declared that the entire idea of economic nationalism was a Russian ideology that plays into “Putins playbook”.

You truly can’t make this nonsense up.

Deep state operatives are now telling the American people that making their OWN country stronger helps the Russians. This has taken the level of Trump derangement syndrome to an all-time high.

The segment also makes clear the transparent fact that the large majority of mainstream media talking heads are globalists first and Americans second (or third in some cases).

As Steve Watson so rightfully noted, “To these unabashed globalists, even hearing the President use the word ‘sovereign’ is a trigger.”

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With just hours to go before the German election, Angela Merkel looks set to remain Chancellor for a record fourth term. This suggests largely unchanged economic policies, focusing on fiscal prudence and conditional steps towards European integration. However, with new political winds clouding the outlook for globalization, trade relationships and security in Europe, and with lingering questions on the sustainability of the EMU, Germany can ill afford to rest on its laurels, according to SocGen. The CDU’s choice of coalition partner(s) will be crucial, with the SDP, FDP and the Greens in a good position to exert concessions. The new government will need to show leadership on domestic reform, thereby maintaining pressure on other euro area countries, while supporting structurally stronger wage growth, not least to support the ECB’s QE exit. To strengthen euro area resilience, there is also a need for progress on the Banking Union and fiscal integration in the coming years, all pieces of a possible future political integration. With Brexit, Germany will also face the task of ensuring a smooth transition and defining the direction of the EU. Merkel’s choices over the coming four years may thus define her legacy more than any previous terms.

Courtesy of WorldView, here is a preview of what to expect this Sunday, and why the German elections matter, and not just for Germany.

Highlights:

• Germany's Sept. 24 election will likely result in one of the most fragmented parliaments the country has seen in decades.
• The country's two largest parties will try to avoid renewing their current coalition partnership, meaning smaller parties will play a big role in the formation of the next government.
• The ideological composition of the new administration will affect negotiations to reform the European Union, and when it comes to Southern Europe's proposals for reform, a center-right coalition would be more skeptical than a center-left coalition.

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Authored by Jeff Thomas via InternationalMan.com,

Recently, US Secretary of the Treasury Steve Mnuchin stated, "If China doesn't follow these sanctions [against North Korea], we will put additional sanctions on them and prevent them from accessing the US and international dollar system."

By this, he meant that the US would shut China out of the SWIFT system, through which the great majority of international settlements are facilitated. In stating this, the US government is doing nothing less than threatening economic warfare against China, which would unquestionably prove catastrophic to the global economy.

This is astonishingly shortsighted, as the US can no more do without trade with China than China can do without trade with the US. Further, the US will unquestionably pressure its other trading partners (particularly the EU) to endorse and follow the sanctions. This they will not comply with, as it would serve to cut their own economic throats. The relationships between the US and their partners have been wearing thin in recent years, and the present threat against China is very likely to prove to be the final straw. The net effect would be to place the US out on an economic limb, alone.

There may be those who disagree with this premise, under the assumption that, to cut China out of the SWIFT system would destroy China's ability to make international transactions, forcing them to cave to US demands.

However, China, Russia, and others have seen this day coming and have created their own SWIFT system, world cable network, and world banking system. All that's needed to kick it all into gear is a major international need to bypass SWIFT. The US government has just provided that need with this threat. There would certainly be teething pains in getting the new system running on a massive scale, but the sudden worldwide need would drive the implementation.

This threat by the US at a time when it's broke is, in effect, economic suicide.

But, just as the ink is drying on this announcement, the increasingly impetuous US president has cracked a deal with Democrats to permanently abolish the US debt ceiling. As the debt ceiling was the last safeguard in governmental fiscal responsibility, he's effectively chosen to assure that the US will experience economic collapse.

Again, economic suicide.

It could be argued that the insatiable ego of “The Donald” has driven him to recklessness. Indeed, it's been his habit, when opposed on anything he wishes to do, to lash out, often creating far more dangerous deals, and saying, effectively, "So, there. I showed you. I'll do as I please, no matter the damage." This would suggest that he's the "Lemming in Chief," leading the US over a fiscal cliff.

It could also be argued that he is, instead, the "Patsy in Chief," and is being cleverly played by those who understand his personality weaknesses and repeatedly goad him into unwise decisions that will benefit them, but will ultimately be disastrous for the country.

Either way, what we're witnessing is a train wreck about to happen, and we're all, to a greater or lesser extent, on that train.

For many years, in predicting the economic collapse of what was once known as the “free world,” I've stated my belief that, whilst we cannot predict the actual dates when the primary events will occur, we can observe the lead-up events—that they'll increase in both frequency and magnitude the closer we get to the collapse. We've recently been in the stage where lead-up events have become weekly. We now appear to be entering the stage where lead-up events become daily. Once we've reached this stage, it's time to fasten our seat belts.

So, in returning to the image above, is this the end of the world? In a word, no. Those who profess the coming end of the world have been with us for, literally, thousands of years. They're just as misguided and incorrect today as they've always been.

It is true, however, that the world as we know it is about to undergo the most dramatic change that we'll witness in our lifetimes. Most certainly, we're presently in the greatest economic bubble the world has ever seen, which assures us that, when it breaks, the damage it causes will be correspondingly great.

But let's have a second look at the image above. It seems apparent that the three men in it are part of a religious group, recommending that mankind repent. As can be seen on the placard in the middle, "Ye must be cleansed."

Regardless of any religious connotations to this placard, there's accuracy in its economic connotations. A collapse is inescapable at this point. The system must be cleansed, much in the way an alcoholic must dry out, or an addict must get the drugs out of his system, before the recovery can begin.

When a crisis of these proportions occurs, it's not possible to simply acknowledge the collapse, then begin anew the next day. Just like the alcoholic or the addict, we can't just hit the reset button and start anew. After a collapse, a long and painful process must begin to cleanse the system. In a collapse of the severity of the one we're facing, the cleansing promises to be quite long and quite painful.

Twenty years ago, in predicting the coming collapse, Harry Schultz predicted, “ten years down; ten years up.” It may well be that his prediction was actually conservative, and we're now looking at a longer period, as so much additional damage has been done since his prediction.

But, before we leave this topic, it's important to look at one more factor. Historically, economic wars have a habit of becoming shooting wars.

It's not commonly known that the US war with Japan was precipitated by the US repeatedly putting the squeeze on Japan economically.

President Roosevelt froze Japanese assets in the US. He subsequently succeeded in cutting Japan off from three-quarters of their international trade. Finally, he cut them off from almost 90% of their oil supply.

It could be argued that, at that point, Japan had no choice but to go to war, however badly it might turn out for them.

Could it be that the US government imagines that similar tactics will force China into a war, so that, when that war ends, the US would control China as it did Japan after 1945?

If that's their intent, the outcome would be unlikely to turn out as they imagine. Although the sabre rattling by US political leaders and retired generals is heard daily on the American news programmes, and the American people are clearly being indoctrinated to believe that war might be necessary, America has never been less ready for a war.

The US is a very different country from what it was in 1941. It does possess a sizable military; however, that military is no match for the combined forces of China and Russia. Moreover, the US is not the industrial giant it was in 1941. Its factories have largely closed and moved overseas. What remains is not sufficient for wartime production. The American people as a whole are heavily in debt and the government itself is broke.

By any standard, the actions being taken by the US are therefore reckless indeed. The end of the world is not nigh, but the end of the world as we know it most certainly is.

If there's a light at the end of the tunnel, it may lie in the fact that, in previous world wars, there were always countries that simply didn't take part. They sat it out in peace, while the rest of the world went mad. This is still true today.

*  *  *

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Just two days ago we wrote about how, despite a budget deal signed back in July that called for a massive tax hike, Illinois’ unpaid payables balance had ballooned to a new all-time record high of $16,046,145,423.20 according the comptroller’s office (see: Illinois Unpaid Vendor Backlog Hits A New Record At Over $16 Billion). 

…which was a 3-fold increase over the past two years.

 

Given that, you can imagine our surprise to wake up to the latest Illinois Bloomberg headline this morning declaring that all is well in the Prairie State and that bondholders are cheering the upcoming, massive $6 billion new GO bond deal by driving existing bonds to all-time highs.

As Illinois prepares for what may be its biggest debt sale in over a decade, its largest investors are celebrating a rally that’s transformed the state’s bonds from one of this year’s worst performers to one of the best.

 

Since the state in July resolved a two-year budget impasse that pushed its rating to the brink of junk, debt issued by Illinois and its local governments has vaulted to a 7 percent return this year, more than any other state, according to S&P Municipal Bond Indices. Until June 8, they were the worst performer among the five most-indebted states, which include Texas, California, Florida and New York.

 

The reversal came after lawmakers enacted a budget — and raised taxes — over Governor Bruce Rauner’s objections. They also extended Illinois authority to reduce a record pile of leftover bills by selling as much as $6 billion of bonds. It would be the state’s biggest sale since 2003 if done in a single offering.

Even more surprising was some of the praise offered up by asset managers on a state that, for all practical purposes, appears to be on a inevitable crash course with bankruptcy…this takes ‘talking your book’ to a whole new level.

Nuveen Investments:  “It has turnaround potential,” said John Miller, co-head of fixed-income at Nuveen, which bought more Illinois bonds in late June and July as the budget came together. The firm plans to take a “hard look” at the $6 billion borrowing, calling it a “benchmark-type deal” because it may be one of the largest of the year, according to Miller, who cautioned that the state’s rising pension-fund debts are still posing risks

 

AllianceBernstein:  “They’ve stopped the bleeding,” said Guy Davidson, director of municipal investments at AllianceBernstein. He said the firm is interested in buying more Illinois debt. “It’s not like we think they have solved their problems. We just think they’ve stabilized their problems.” Davidson said investors are “getting paid more than we think the risk entails”

 

Wells Fargo Asset Management:  “They’re not under the gun as much as far as ratings go,” saidDennis Derby, a portfolio manager at Wells, which holds $40 billion of municipal debt. The firm would be “more comfortable” if the state took action soon to reduce the $16 billion of unpaid bills

 

BlackRock:  The tax hike gives the state “more tools” to meet their expenses and obligations, marking an improvement, said Joe Gankiewicz, a credit-research analyst in Princeton, New Jersey, for the company, which oversees about $124 billion of municipal debt. The state’s unfunded retirement liabilities — $130 billion, according to the Commission on Government Forecasting and Accountability — remain an issue. “The pension expense is likely to outstrip the organic revenue growth in the state in the coming years,” Gankiewicz said

Perhaps these bondholders overlooked the fact that Illinois’ 5 largest publicly-funded pensions are now $130BN underwater and only 37.6% funded?

 

Ironically, bondholders cheered tax hikes as the savior of Illinois’ financial problems but repeated income tax hikes, property tax hikes and the state’s political dysfunction have resulted in record population losses over the last three years…

…to put it into perspective, Illinois loses 1 resident every 4.6 minutes.

Last time we checked, non-residents weren’t on the hook to pay Illinois taxes…

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Authored by Mark Hanson via MHanson.com,

Bottom Lines: 

• The income required to buy a median priced builder house has been more diverged from fundamental, end-user, mortgage-needing, shelter-buyer cohort income (purchasing power), which is why builder demand and end-user resales remain anemic.  
• Meaningful sales growth with this affordability backdrop is impossible.
• A mean reversion – via surging wages, new era exotic loans, plunging rates, and/or falling house prices, as speculation ebbs – is inevitable. 

Summary

My chart highlights how for DECADES the income required to buy a median priced house – using popular programs & rates for each era – remained mostly flat (red line) and WELL BELOW the level of household income (black line).

How could house prices rise so much for decades but income required to buy (red) them remain flattish?  Because of the accompanying falling rates/easing credit guideline cycle.  In fact, during Bubble 1.0 house prices soared but exotic loans legitimately made them more affordable than ever, as shown.

But in ’12, as trillions in unorthodox capital, credit & liquidity began to drive massive speculation (just like Bubble 1.0) income required to buy began to surge, with prices, shooting above median HH income (boxed in yellow). Meaningful sales growth with this affordability backdrop is impossible.

…This is the point in this inflationary cycle at which affordability detached from end-user fundamentals.

Now, in ’17, end-user purchase power & house prices have never been more diverged from the multi-decade trend line and a mean reversion – via surging wages, new era exotic loans, plunging rates, and/or falling house prices, as speculation ebbs – is inevitable.

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Throughout the week President Trump has taken repeated shots at Senator Rand Paul for his continued resistance to the so-called Graham-Cassidy Obamacare repeal bill.  Among other things, Trump defined Paul as a “negative force when it comes to fixing healthcare” and said that he would forever by remembered as ‘the Republican who saved ObamaCare.’

“Rand Paul is a friend of mine but he is such a negative force when it comes to fixing healthcare. Graham-Cassidy Bill is GREAT! Ends Ocare!”

 

“Rand Paul, or whoever votes against Hcare Bill, will forever (future political campaigns) be known as ‘the Republican who saved ObamaCare.'”

Rand Paul is a friend of mine but he is such a negative force when it comes to fixing healthcare. Graham-Cassidy Bill is GREAT! Ends Ocare!

— Donald J. Trump (@realDonaldTrump) September 20, 2017

Rand Paul, or whoever votes against Hcare Bill, will forever (future political campaigns) be known as “the Republican who saved ObamaCare.”

— Donald J. Trump (@realDonaldTrump) September 22, 2017

 

But it seems as though Trump’s latest attack this morning struck a nerve with Senator Paul as he has fired back with a tweet storm of his own saying that it’s disingenuous to call “a bill that KEEPS most of Obamacare” a “repeal” bill before concluding that he will not be “bribed or bullied” by the President’s twitter feed.

“No one is more opposed to Obamacare than I am, and I’ve voted multiple times for repeal.  The current bill isn’t repeal.”

 

“I won’t vote for Obamacare Lite that keeps 90% of the taxes & spending just so some people can claim credit for something that didn’t happen.”

 

“Calling a bill that KEEPS most of Obamacare “repeal” doesn’t make it true. That’s what the swamp does. I won’t be bribed or bullied.”

No one is more opposed to Obamacare than I am, and I’ve voted multiple times for repeal. The current bill isn’t repeal.

— Senator Rand Paul (@RandPaul) September 22, 2017

Calling a bill that KEEPS most of Obamacare “repeal” doesn’t make it true. That’s what the swamp does. I won’t be bribed or bullied.

— Senator Rand Paul (@RandPaul) September 22, 2017

 

Of course, while the Graham-Cassidy bill continues to flood headlines, it was all but killed earlier this afternoon when Senator John McCain announced that he “cannot in good conscience vote for Graham-Cassidy.”

I cannot in good conscience vote for Graham-Cassidy. A bill impacting so many lives deserves a bipartisan approach. https://t.co/2sDjhw6Era http://pic.twitter.com/30OWezQpLg

— John McCain (@SenJohnMcCain) September 22, 2017

Meanwhile, with Lisa Murkowski (R-AK), Susan Collins (R-ME) and Mike Lee (R-UT), among others, still saying they’re on the fence, The Hill pointed out that Senators Graham and Cassidy have gone “into overdrive” to design “special accommodations” to win over holdouts.

Graham told a meeting of conservative activists last week that special accommodations would have to be made in the bill for Alaska to win over Murkowski. The senator asked the groups to understand, and to not make a stink if concessions were made.

 

The Graham-Cassidy proposal would convert ObamaCare’s subsidies and funds for Medicaid expansion into block grants that would be given to states to design their own programs.

 

Right now it looks like an uphill battle to change Murkowski’s mind.

 

“I’d say the chances are less than 30 percent. Alaska doesn’t do very well in this bill. Her governor is lukewarm on it and her insurance commissioner is not for it,” one Senate GOP aide added.

 

Graham on Wednesday downplayed the notion that Alaska would fare better than other states in the bill but nevertheless acknowledged that something would have to be done to accommodate the state’s high costs.

 

“What we’re going to do is not deny Alaska the uniqueness of Alaska, but that’s it,” he said, according to The Washington Post.

So, while Lindsey Graham seems to still be optimistic…

I’m excited about solutions we have found in Graham-Cassidy-Heller-Johnson. We press on.

— Lindsey Graham (@LindseyGrahamSC) September 22, 2017

…all signs indicate that ‘Obamacare Repeal 3.0’ has once again been nothing but a colossal waste of time.

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It's Friday night and with stocks at record highs, Trump's approval ratings jumping to 4-month highs, and Mueller scraping the bottom of the barrel for anything to pin on anyone, the media has their red meat for the weekend now as DHS has notified 21 states Friday that their election systems were targeted before the 2016 election.

The government told The Associated Press last year that more than 20 states were targeted by hackers believed to be Russian agents before the 2016 elections. But for many states, the calls Friday from the Department of Homeland Security were the first official confirmation of whether their states were on the list.

DHS Spokesman Scott McConnell said in a written statement to The Hill…

"[R]ecognizing that state and local officials should be kept informed about cybersecurity risks to election infrastructure, we are working with them to refine our processes for sharing this information while protecting the integrity of investigations and the confidentiality of system owners."

"As part of our ongoing information sharing efforts, today DHS notified the Secretary of State or another chief election officer in each state of any potential targeting we were aware of in their state leading up to the 2016 election. We will continue to keep this information confidential and defer to each state whether it wishes to make it public or not.”

So the government did not release a list of what states were notified. However, as AP reports, after contacting every state election office on Friday…

While not all of them responded immediately, those that said they were targeted were Alabama, Arizona, Colorado, Connecticut, Illinois, Iowa, Maryland, Minnesota, Ohio, Oklahoma, Pennsylvania, Virginia, Washington and Wisconsin.

Federal officials said that in most of the 21 states, the targeting was preparatory activity such as scanning computer systems.

The targets included voter registration systems but not vote tallying software.

Officials said there were some attempts to compromise networks but most were unsuccessful.

The government did not say who was behind the hacking attempts or provide details about what had been sought.

But election officials in three states said Friday the attempts could be linked to Russia.

The Wisconsin Election Commission seem utterly convinced that the state's systems were targeted by "Russian government cyber actors."

Wisconsin Notified of Unsuccessful Russian Hacking Attempt

 

This afternoon, the U.S. Department of Homeland Security notified the Wisconsin Elections Commission for the first time that “Russian government cyber actors” unsuccessfully targeted the state’s voter registration system in 2016.

 

WEC Administrator Michael Haas has informed WEC Chair Mark Thomsen, who directed Commission staff to investigate why election officials were not notified earlier and report to the Commission at its meeting Tuesday.

 

“This scanning had no impact on Wisconsin’s systems or the election,” Haas said. “Internet security provided by the state successfully protected our systems.  Homeland Security specifically confirmed there was no breach or compromise of our data.”

 

Wisconsin is one of 21 states whose chief election officials were notified Friday by DHS officials that their systems were targeted by Russians, said Haas. DHS did not disclose which other states were notified, but said the states were free to disclose the information.

 

According to DHS, it appears that Internet-facing election infrastructure in Wisconsin was targeted by Russian government cyber actors. They scanned internet-connected election infrastructure likely seeking specific vulnerabilities such as access to voter registration databases, but the attempt to exploit vulnerabilities was unsuccessful.

 

Haas said the Commission is seeking more specific information, including when the scanning activity occurred in 2016.

 

The news that 21 states were targeted was first announced by DHS at a U.S. Senate Intelligence Committee hearing on June 21, 2017.  Coincidentally, Haas also testified at that hearing and said in response to questions that the Elections Commission had not been notified by DHS and concluded that Wisconsin was not one of the targeted states.

Which reads more like WI officials wanting to crows of their security and pin the blame of Russians (when we know from what AP reported that no blame was asssigned, merely notification of targeting).

Colorado said the hacking wasn't quite a breach.

"It's really reconnaissance by a bad guy to try and figure out how we would break into your computer," said Trevor Timmons, a spokesman for the Colorado secretary of state's office.

 

"It's not an attack. I wouldn't call it a probe. It's not a breach, it's not a penetration."

Only Illinois reported that hackers had succeeded in breaching its voter systems.

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For the first time since 2008, a team of Wall Street Journal journalists has been allowed to visit and document the North Korean capital city of Pyongyang just as tensions between the US and its longtime geopolitical foe are reaching a boiling point.

The team of reporters was taken on a guided tour of the showcase capital, reporting that the country’s nuclear ambitions appear to be etched into the city’s landscape. Giant sculptures of atoms sit on top of new apartment towers built for the country’s nuclear scientists.

The atomic aesthetics, WSJ said, only reinforced the idea that the country would never voluntarily part with its nuclear program.

“During a recent visit, the first by The Wall Street Journal since 2008, the city’s atomic aesthetics reinforced the message government officials conveyed repeatedly to the Journal reporters: North Korea won’t part with its nuclear weapons under any circumstances and is resolved to suffer economic sanctions and risk war with the U.S. to keep them.”

One North Korean official told the WSJ that the country has ”grown up” and that it isn’t “interested in dialogue that would undermine our newly built strategic status.”

WSJ noted that North Korea launched a ballistic missile over Japan on the second day of the trip. And hours after the group departed, US President Donald Trump vowed to “totally destroy North Korea” if the US is required to defend itself or allies, saying leader Kim Jong Un, whom he called “Rocket Man”, was on a “suicide path for himself and his regime.”

However, the two English-speaking diplomats in dark suits who chaperoned WSJ’s reporters during their trip took a “more measured tone.”

Over the next few days, they monitored several official interviews, visits to city landmarks and brief encounters with a handful of Pyongyang residents, which appeared to signal a rare outreach campaign by the government for outside news organizations to convey what it sees as the logic of its nuclear-weapons program. The US and North Korea don’t have diplomatic relations, and even indirect contact is limited.

North Korea only allows outside media to visit with the explicit sanction of the state, and visitors are kept under close watch. Authorities granted WSJ requests to visit factories and stores, which were chosen by the government.

Here is a collection of photos the reporters took during their visit to Pyongyang:

An atomic sculpture outside a newly constructed residential building for the country's nuclear scientists.

Children play with plastic weapons at an orphanage in Pyongyang.

The Dear Leader…

 

The entrance hall at Pyongyang’s new science library, crowned by a painting of former leaders Kim Il Sung and Kim Jong Il…

A replica of a North Korean rocket stands in the center of the science library…

In another telling detail, WSJ spoke with Ri Song Ho, who directs the Golden Cup Trading Co. factory, which produces some 700 different snacks, sodas, breads and sweets. Among its brands is a cake featuring an image of a North Korean rocket ready for launch.

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