Category: zerohedge

Just a couple of days ago we noted that the Department of Homeland Security (DHS) had “mistakenly” granted citizenship to over 850 immigrants from “countries of concern to national security” even after they had been flagged for deportation by U.S. Immigration and Customs Enforcement (ICE) (see “DHS Admits “Mistakenly” Granting Citizenship To 858 Immigrants From ‘Countries Of Concern To National Security’“).  Now, newly disclosed DHS emails, indicating a rush to “process as many [citizenship] cases as possible due to the election year,” may help explain why so many “mistakes” were made. 

A recent letter from Senator Chuck Grassley (R – Iowa) to the DHS, expressed concerns over the newly revealed emails and whether there may be efforts within U.S. Customs and Immigration Services (USCIS) to naturalize as many potential voters as possible before election day.  Per Grassley’s letter (which can read in it’s entirely below), someone in the Houston USCIS field office sent the following email to office staff asking employees to consider working overtime in order to process as many naturalization applications as possible before the election: 

“The Field Office due to the election year needs to process as many of their N-400 cases as possible between now and FY 2016.”

 

“If you have cases in this category or other pending, you are encouraged to take advantage of the OT if you can.  This will be an opportunity to move your pending naturalization cases. If you have not volunteered for OT, please consider and let me know if you are interested.”

Another person within the Houston field office forwarded the message saying “it’s the end of the year crunch time!”

“I couldn’t have said it better!  It’s the end of the year crunch time, so let’s get crunchy! Go Team Houston! Thanks for all your hard work!”

Grassley’s letter to Jeh Johnson of the DHS, blasts efforts to hastily grant citizenship as “an attempt to create as many new citizen voters as possible.“

“We write to express serious concern about an apparent push by your department to rush the adjudication of naturalization applications before the upcoming presidential election, presumably in an attempt to create aa many new citizen voters as possible.“

Grassley also points out that this is not the first time efforts have been taken to rush the approval of citizenship applications for election purposes.  Apparently similar efforts were made ahead of the 1996 election when citizenship grants soared by nearly 4x.

“Unfortunately, we have been down this road before.  In the year preceding the 1996 presidential election the Immigration and Naturalization Service (INS), the predecessor agency for USCIS, established the notorious “Citizenship USA” (CUSA) initiative.  Previously, the INS had been granting citizenship to 300,000 to 400,000 aliens per year, but under CUSA that increased to 1.1 million cases.  The apparent push to naturalize as many aliens as possible in time for them to vote in the election resulted in cut corners that endangered national security and public safety.”

Any other election year this news might be shocking but this year, for some reason, we’re not terribly surprised.

 

Senator Chuck Grassley’s letter to the Department of Homeland Security

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By Mr. Risk – State Street Global Markets

Unleash Volatility Beast

Thanks for nothing, central banks!

1. If central banks provided the prototypical inflection point, risk assets should get destroyed next week.
2. Feast your eyes on a compendium of volatility charts. The beast wants out.
3. Keys to watch: DXY, EURAUD, and 10-year yields. Move over ZEROHEDGE. There is a new BEAR in town,

* * *

Ahead of the BOJ and Fed meetings, volumes slowed to a trickle, traders got back to flat, and algos reached for the offswitch. Now that event risk is in the rear view mirror, it is time to vote. Buy-the-dip or ‘‘sell everything?’’ If classic market reflexes are in play, a market meltdown following the passing of event risks is by far the more likely outcome. That US equities launched higher is nothing, because it  always does that on Fed day. The obligatory central bank forensic is a good place to begin.

Expectations as measured by overnight volatility ahead of the BOJ were the third highest in 3-years. Notably, 7 out of the 10 highest readings have occurred in 2016, which says something about the growing perception about policy failure. Expanding monetary base has not delivered higher inflation expectations or a weaker currency. Just about every 2016 meeting USDJPY sunk like the proverbial stone.

The ‘‘monetary assessment’’ conducted by the BOJ was an admission that QQE was unsustainable, and needed to be tweaked. Plan B is ‘‘QQE with yield curve control.’’ No, that is not a new shampoo. Here is the stripped down ghetto-economist version.

1. Negative interest rate
2. Stabilize 10-year yields at 0%
3. Keep asset purchases at ¥80 tn/year
4. Abandon monetary base target
5. Aim to overshoot the 2.0% inflation target
6. Rebalance ETF by buying less Nikkei 225 linked ETFs and more Topix, removing a well-flagged distortion.

On the day, Topix banks were big winners (6.97%) versus Topix (2.7%). Not going negative and signalling a steeper curve was reasons to celebrate. As for yen it was rinse, repeat. Ostensibly ease, watch the currency weaken for a nanosecond before a violent reversal. Collectively, it was along the lines of ‘‘hey, its BOJ day, aren’t we supposed to sell USDJPY? What the heck is it doing above 102? Sell it.’’ As for the boldness of the policy these are Mr Risk’s conclusions:

1. Policymakers have not lost their appetite for untested monetary experimentation.
2. Pure Krugman — credibly promise to be irresponsible.’’
3. It’s radical. The question is how credible.
4. On the flipside: BOJ opens the door to ‘‘stealth tightening’’, as one commentator worries.

Inviting an inflation overshoot when not a single economist believes that the BOJ will achieve its 2.0% inflation target in FY 2017 sounds like a sick joke, but really it is a radical. Even more radical is the commitment to hold JGB 10-year yields at zero. If inflation is rising as the economy heats up, they are pledging to cap nominal 10-year yields and thus keep lowering real rates, adding juice to the inflation trend. Alternatively, what happens if the global factor driving all global bond yields goes even lower? Then BOJ has committed to selling JGBs, thereby tapering and draining liquidity. This could get interesting.

In the Q&A, Kuroda talked about the unwanted negative impacts on credit creation from yield curve flattening. It hurts banks NIM and threatens pension funds ability to deliver on promises. The BOJ wants to steepen the curve, but not by increasing longer yields because that is a monetary tightening. By deduction the market factors in a lower deposit rate going forward. FX traders don’t like it, but bank stocks might. Perhaps that links the two different outcomes.

Confused? Tim Graf says the BOJ embraces uncertainty. That nails the zeitgeist. The world just got a little crazier and a little more dangerous. Central banks need to learn that when you are in a hole, stop digging.

Mr Risk’s takeaway is in line with Greg Ip’s who said ‘‘central banks have shown the will to hit their growth and inflation targets but do they have the way?’’ Read his article. Central bank tools are losing their edge. The BOJ gets full marks for monetary experimentation, but investors are increasingly set to question why previous innovations have fallen short. This marks the most worrying thing possible, namely, the popping of the central bank bubble.

YELLEN: NOTHING TO SEE HERE

The headline is ‘‘open warfare’’ at the Fed with three Fed Presidents voting for a hike, the first time that three members have dissented in favour of tighter policy since September 2011 under previous Chairman Bernanke, before that it was 1990. Lee Ferridge pens the analysis with a cheeky title: We will hike in December; honest we will. In the most simplistic terms it appears as if the Brainard stock went up. Let the labour market run hot carried the day.

Forget the ‘‘dots.’’ Put no stock in the idea that the Fed makes the case for a year-end hike, as argued by Hilsenrath. Uncertainty ahead of the election is the real reason the Fed stood pat, fearing what might happen to financial markets and economic data if ‘‘the Donald’’ wins.

In the medium term, the issue with the ‘‘dots’’ boils down to a credibility problem. Michael Metcalfe writes that the ‘‘FOMC is caught in a potentially vicious circle. The market has had a run where it appears to be a better forecaster of the policy rate than the FOMC. This limits the ability of FOMC to guide market expectations because the market believes it knows better. If policy makers are then unwilling to surprise the market, as they have been historically, this reinforces the market’s better run at forecasting the policy rate and makes it even harder for the policy makers to guide expectations.’’

Now something interesting that many may not know. While a dissent from Fed Presidents happens quite a lot, only three times have Fed Governors dissented. Even more interesting is the power to change rates rests with the 5 Governors — Yellen, Fischer, Tarullo, Powell and Brainard. That is not a typo. Yes just these five. The Financial Services Regulatory Relief Act of 2006 amended the 1913 Federal Reserve Act to give the Fed the authority to pay interest on reserves beginning Oct 1, 2011. Did you know that it is only these 5 Fed Governors who have the power to set the rate of interest of excess reserves? Now that is interesting right?

After a press conference with plenty of the usual waffle, financial markets do what they always do on Fed day; they rallied. So far it’s carrying on today, giving the buy-the-dip crowd something to crow about.

TECHNICAL DOLLAR

DXY is setting up for a monster move. It can go either way, but there is an excellent chance this launches higher. It’s not like the Fed can do anything more on the policy front to crush it. Moreover, the a-b-c-d-e triangle may resolve higher in an explosion of volatility. Mr Risk is in wait mode. Let market forces tell us which way it breaks.

BULL LOGIC

While trolling Twitter, Mr Risk came across the following from Anil@anilvohra69. You just have to laugh at fitting the facts to the story or is it the story to the facts, Mr Risk forgets.

Yields

• High yields signal stronger growth
• Low yields make stocks more attractive via a lower-discount rate.
• Either way, buy stocks

Volatility

• Low volatility is good — it reflects confidence
• High volatility is good — as it declines stocks rally
• Either way, buy stocks

Oil

• Low oil is a tax cut for consumers
• Higher oil boosts investment
• Either way, buy stocks

DISTURBING FUN FACTS

• Factset reports S&P500 quarterly buybacks declined 6.8% y-o-y% in Q2 to $125 billion. This is uber-positive for volatility as buybacks are one of the key variables suppressing it.
• The last day of summer (21 Sept, or if a weekend, the previous trading day) has only 4 previous times since 1994 been an up day. Yesterday made it 5.
• The week after September options expiration has only been higher 4 times in the last 26 years or (15% of the time). It is down 1.1% on average. That does not bode well for Friday.
• What does 2016 have in common with 1986, 1990, 2001, and 2008? Bloomberg story says: falling profit margins, LMCI negative 12-month change, Capex negative, and Speculative grade defaults above 5.5%. Only 1986 escaped recession, but remember that energy consumption share was larger and we did not have shale production.
• The $400bn risk parity is in the crosshairs. It is estimated that there could be ‘‘$50bn of bond selling from risk parity type investors.’’ Read this: is the latest risk-parity blow up just starting and is a VaR shock just starting: here is the checklist. Honestly, this is one of the hottest topics right now.

UNLEASH THE VOLATILITY BEAST

If central bank bubble is popping then all of these following charts might actually mean something. If not, they are just a bunch of charts that look incredible but mean nothing. Let the reader decide.

Let’s begin with the 1-year average of the VIX which catches the long cycle. It shows the two phases. Below 16, is benign, above 16 is disturbing. It has popped above the threshold and if history repeats is in the beginning of the high volatility phase which can last for the next year.

The 3-month change in S&P 12-month forward earnings peaked in July (2.76%), turning down in August (2.20%). ISM points to a further decline. This is pointing to a higher VIX reading.

Profit margins have declined 8 quarters on the trot. Consequently, the corporate financing gap has turned south which means increased dependence on external sources of liquidity, aka, debt. In the past such moves in the financing gap signal a downturn as well as boost the VIX.

What is absolutely critical for unleashing volatility is a US or global recession. Expansions are not supposed to die of old age, but nonetheless the current expansion is the 4th longest based on NBER dating. There is a plethora of economic and financial series pointing towards recession. A full piece on that is on the ‘‘to-do’’ list.

The yield curve slope adjusted for the level of yields warns of recession. Keen followers of demographics like Mr Risk’s pal Michael Green (Ice Farm Advisors) argue that the incentives are set to disappear to work past 70.5 years from a Social Security benefits standpoint. This is critical. The baby boom began in 1946. Do the math. Add 70.5 to 1946 and you get 2016.5. What do retirees not do? They don’t work. They don’t spend. Still not convinced? Consider the Social Security Act was passed August 14, 1935. While not the primary reason for the 1937-38 recession, payroll taxes were first collected in 1937. These things matter.

The flattening yield curve slope (3m-10y) is another useful indicator when advanced 2-years against the VIX.

The Fed’s Senior Loan Survey percent of banks tightening lending standards points to the beginnings of a credit crunch. Wait, are you saying that we should worried about not just energy loans, but car loans and commercial property loans? Oh, this is starting to get interesting.

If that chart did not get the visceral juices flowing, wait for this next one. C&I delinquency rates deviation from its 12- month average not only is ripping higher but in fact hit the worst readings of all time. When will the VIX wake up?

Markets are interconnected. Positive SPY/TLT says there is little diversification value, which adds to pressure to deleverage positions.

SEXY SEPTEMBER SEASONAL

2016 Dow price action is tracking the 1900-2012 Presidential-cycle September returns like a glove. Note that the real serious waterfall style declines are historically next week, which by the way coincides with the Trump-Clinton first debate. Also note that the incredible fit to the historical trend so far this month.

USDJPY — GET A GRIP

Normally, we expect USDJPY to behave in line with US 10-year yields, the Nikkei and volatility. For one of the longest stretches in a while, this currency pair has misbehaved. Mr Risk is sending it to its room with no dinner, no Facebook, and taking away its stash of Cohibas. More seriously, this persistence dislocation speaks to positioning, top side export sellers, and ultimately a lack of faith in the BOJ to deliver  a weaker currency. Hope springs eternal for this USDJPY bull!

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We’re beginning to think the entire FBI investigation into Hillary’s private email servers was just a ruse to grant immunity to her entire staff.  According to the AP, the House Oversight Committee has just learned that Hillary’s top aide, Cheryl Mills, was also granted immunity along with John Bentel (Director of the State Department’s Office of Information Resources Management) and Heather Samuelson (Clinton aide). 

For those of you keeping count, we are now aware of a total of 5 immunity deals offered to people directly involved in the Hillary email scandal:

Cheryl Mills – Clinton’s top aide

Heather Samuelson – Clinton aide

John Bentel – Director of the State Department’s Office of Information Resources Management

Bryan Pagliano – Clinton technology aide

Paul Combetta – Platte River Networks

The Chair of the House Oversight Committee, Jason Chaffetz (R-Utah), expressed his complete disbelief over the number of immunity deals granted in this investigation.  Per The Hill, Chaffetz said that he has “lost confidence in this investigation” noting that “immunity deals should not be a requirement for cooperating with the FBI.”

“This is beyond explanation. The FBI was handing out immunity agreements like candy,” House Oversight Committee Chairman Jason Chaffetz (R-Utah) said in a statement.

 

“I’ve lost confidence in this investigation and I question the genuine effort in which it was carried out. Immunity deals should not be a requirement for cooperating with the FBI.”

The latest immunity discoveries were first revealed by the AP in the following tweet:

Congressman: FBI gave immunity to Hillary Clinton’s ex-chief of staff, Cheryl Mills, in now-closed email case. https://t.co/gDb60PH2Gt

— The Associated Press (@AP) September 23, 2016

 

For those of you who “do not recall” the specific involvement of Cheryl Mills and Heather Samuelson in the Hillary email scandal, here is brief recap.

Shortly after providing the initial set of Hillary’s emails to the State Department, in “December 2014 or January 2015,” both Heather Samuelson and Cheryl Mills requested that all emails be removed from their computers using “a program called BleachBit to delete the e-mail-related files so they could not be recovered.” 

Per the excerpt below from the FBI’s investigation notes, Mills was also the Clinton aide who instructed Paul Combetta (the “Oh Shit” guy) to “modify [Hillary’s] e-mail retention policy” to 60 days…in other words get rid of everything. 

 

Can the FBI just save us all some time and admit that literally everyone interviewed in this case received an immunity deal from the DOJ?

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Having earlier heard president Obama's advice for how Hillary Clinton can win the debates, Patrick Buchanan offers his advice to Donald Trump…

On one of my first trips to New Hampshire in 1991, to challenge President George H. W. Bush, I ran into Sen. Eugene McCarthy.

He was returning to the scene of his ’68 triumph, when he had inflicted the first crippling wound on Lyndon Johnson.

“Pat, you don’t have to win up here, you know,” he assured me. “All you have to do is beat the point spread.”

“Beat the point spread” is a good description of what Donald Trump has to do in Monday night’s debate.

With only a year in national politics, he does not have to show a mastery of foreign and domestic policy details. Rather, he has to do what John F. Kennedy did in 1960, and what Ronald Reagan did in 1980.

He has to meet and exceed expectations, which are not terribly high. He has to convince a plurality of voters, who seem prepared to vote for him, that he’s not a terrible risk, and that he will be a president of whom they can be proud.

He has to show the country a Trump that contradicts the caricature created by those who dominate our politics, culture and press.

The Trump on stage at Hofstra University will have 90 minutes to show that the malicious cartoon of Donald Trump is a libelous lie.

He can do it, for he did it at the Mexico City press conference with President Pena Nieto where he surprised his allies and stunned his adversaries.

Recall. Kennedy and Reagan, too, came into their debates with a crucial slice of the electorate undecided but ready to vote for them if each could relieve the voters’ anxieties about his being within reach of the button to launch a nuclear war.

Kennedy won the first debate, not because he offered more convincing arguments or more details on the issues, but because he appeared more lucid, likable and charismatic, more mature than folks had thought. And he seemed to point to a brighter, more challenging future for which the country was prepared after Ike.

After that first debate, Americans could see JFK sitting in the Oval Office.

Reagan won his debate with Carter because his sunny disposition and demeanor and his “There you go again!” airy dismissal of Carter’s nit-picking contradicted the malevolent media-created caricatures of the Gipper as a dangerous primitive or an amiable dunce.

Even George W. Bush, who, according to most judges, did not win a single debate against Al Gore or John Kerry, came off as a levelheaded fellow who was more relatable than the inventor of the internet or the windsurfer of Cape Cod.

The winner of presidential debates is not the one who compiles the most debating points. It is the one whom the audience decides they like, and can be comfortable taking a chance on.

Trump has the same imperative and same opportunity as JFK and Reagan. For the anticipated audience, of Super Bowl size, will be there to see him, not her. He is the challenger who fills up the sports arenas with the tens and scores of thousands, not Hillary Clinton.

If she were debating John Kasich or Jeb Bush, neither the viewing audience nor the title-fight excitement of Monday night would be there. Specifically, what does Trump need to do? He needs to show that he can be presidential. He needs to speak with confidence, but not cockiness, and to deal with Clinton’s attacks directly, but with dignity and not disrespect. And humor always helps.

Clinton has a more difficult assignment.

America knows she knows the issues. But two-thirds of the country does not believe her to be honest or trustworthy. As her small crowds show, she sets no one on fire. Blacks, Hispanics and millenials who invested high hopes in Barack Obama seem to have no great hopes for her. She has no bold agenda, no New Deal or New Frontier.

“Why aren’t I 50 points ahead?” wailed Hillary Clinton this week.

The answer is simple. America has seen enough of her and has no great desire to see any more; and she cannot change an impression hardened over 25 years — in 90 minutes.

But the country will accept her, if the only alternative is the Trump of the mainstream media’s portrayal. Hence, the strategy of the Democratic Party for the next seven weeks is obvious:

Trash Trump, take him down, make him intolerable, and we win.

No matter how she performs though, Donald Trump can win the debate, for he is the one over whom the question marks hang. But he is also the one who can dissipate and destroy them with a presidential performance.

In that sense, this debate and this election are Trump’s to win.

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Doing nothing to dispel chatter of a papal push for a utopian totalitarian nightmare, Pope Francis seemed to suggest that freedom of speech was over-rated in an address he gave this week. Media that stereotype entire populations (like 'Deplorables'?) and journalist fear-mongers are akin to "terrorists," according to Pope.

As the first ever Pope to address a joint session of Congress, he took some shots at the structural evils of free market capitalism and the unequal distribution of wealth. As early as 2013, when he penned his Apostolic Exhortation, in which he laid out his broad vision for the Catholic Church, Pope Francis has been clarifying his positions on these topics.

With the subsequent release of his controversial encyclical on global warming in June 2015, he established two pressing themes that monopolized his visit.

Climate change was the focus of his address to the UN General Assembly on September 25, as he kicked off the 2015 UN Summit on Sustainable Development and its seventeen-point utopian agenda for the entire planet, packaged in a thinly disguised reboot of Agenda 21. According to IPS news:

"Judging by his recent public pronouncements – including on reproductive health, biodiversity, the creation of a Palestinian state, the political legitimacy of Cuba and now climate change – Pope Francis may upstage more than 150 world leaders when he addresses the United Nations, come September… The Pope will most likely be the headline-grabber, particularly if he continues to be as outspoken as he has been so far."

Along the way, he has managed to stun even many Catholics with pronouncements about issues that they think should be none of his business. And now, as Reuters reports, Pope Francis appears to be aiming his papal power at press freedom of speech…

Journalism based on gossip or rumors is a form of "terrorism" and media that stereotype entire populations or foment fear of migrants are acting destructively, Pope Francis said on Thursday.

 

Francis, who made his comments in an address to leaders of Italy's national journalists' guild, said reporters had to go the extra mile to seek the truth, particularly in an age of round-the-clock news coverage.

 

Spreading rumors is an example of "terrorism, of how you can kill a person with your tongue", he said. "This is even more true for journalists because their voice can reach everyone and this is a very powerful weapon."

 

…

 

Francis, who has often strongly defended the rights of refugees and migrants, said journalism should not be used as a "weapon of destruction against persons and even entire peoples".

 

"Neither should it foment fear before events like forced migration from war or from hunger," he added.

As was discussed previously, this is another concept taken from the "Apostolic Exhortation" handbook; some suggest it sounds like a call for a revolution.

Pope Francis undoubtedly knows that some of these ideas are not likely to go over as well in the United States as they did in Latin America. Especially as the US Election exposes the disgusting bias in mainstream media. According to the New York Times noted last year,

"As his papal jetliner was returning to Rome (from his recent visit to South America), Francis signaled that he knew his economic message was already facing criticism in the United States and pledged to study it. Some critics blame him for rebuking capitalism with an unduly broad brush. Others say he ignores that globalization has lifted hundreds of millions of people out of poverty."

The Pope also knows, however, that the UN has strong-armed member nations to sign on to an impossible globalist agenda that will require a total shift of the world's wealth, and a restructuring of international politics and economics with a one-world government and a universal religion at the steering wheel. Even to the Pope's admirers, that sounds a less like peace and love and more like a utopian totalitarian nightmare.

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Are you ready for some fireworks?

 

Source: Townhall.com

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Submitted by Darius Shahtamasebi via TheAntiMedia.org,

Who actually benefits from American-led wars across the globe? The aftermath of American-led conflicts shows it is not the common people, though the military and politicians vow they are liberating and protecting them.

The Sunday Mail, Zimbabwe’s “leading family newspaper,” has published accounts of a number of Libyans who expressed regret over Muammar Gaddafi’s overthrow in 2011, despite the fact some of them even took up arms against him. As one said:

“‘I joined the revolution in the first days and fought against Gaddafi,’ former revolutionary fighter Mohammed, 31, said from the southern city of Murzuq. ‘Before 2011, I hated Gaddafi more than anyone. But now, life is much, much harder, and I have become his biggest fan.’”

In 2011, we were told Gaddafi was going to commit grave bloodshed against his own people and that as a result, the international community needed to intervene to protect Libyan civilians. This proved to be false, according to an analysis of statistics obtained by Human Rights Watch. Further, an investigation conducted by Amnesty International also found a number of claims against Gaddafi were fabricated, as noted by the Independent:

“Nato leaders, opposition groups and the media have produced a stream of stories since the start of the insurrection on 15 February, claiming the Gaddafi regime has ordered mass rapes, used foreign mercenaries and employed helicopters against civilian protesters.

 

“An investigation by Amnesty International has failed to find evidence for these human rights violations and in many cases has discredited or cast doubt on them. It also found indications that on several occasions the rebels in Benghazi appeared to have knowingly made false claims or manufactured evidence.”

The so-called “no-fly zone” the U.N. Security Council Resolution authorized did not allow for regime change, something NATO representatives further promised their Eastern counterparts would not happen. The resolution only authorized the coalition forces to take all necessary measures to protect civilians under threat of attack in the country, including Benghazi, while excluding a foreign occupation force of any form on any part of Libyan territory. The resolution requested that the coalition immediately inform the Secretary-General of such measures.

What this “no-fly zone” actually entailed was a full-scale assault on Gaddafi’s forces to ensure none of his aircraft could fly within his own country’s airspace. It also meant anything capable of taking out a coalition warplane would also have to be destroyed.

All of these NATO bombs were allegedly intended to protect civilians.

Furthermore, a Libyan rebel commander went on record to admit his fighters included al-Qaeda-linked jihadists who had fought against U.S. troops in Iraq. These fighters, known at the time as al-Qaeda in Iraq, are now referred to as ISIS. It should be no surprise that ISIS now has a stronghold in Libya following the fall of Gaddafi.

Before the NATO onslaught, Libya had the highest standard of living of any country in Africa. This meant the people enjoyed state-sponsored healthcare, high literacy rates, and other benefits that come with living in a relatively prosperous society. In 2015 alone, the country fell 27 places on the U.N. Human Development Index ratings. According to UNICEF, there are now two million Libyan children out of school.

Consumers of corporate media might also be surprised to learn Libya had an inclusive and progressive democracy where decision-making was conducted at the local level. It was not the dictatorship Sacha Baron Cohen incorrectly portrayed in his film, The Dictator.

Regardless of one’s views of Gaddafi, the former Libyan leader was able to provide stability and good governance to the people of Libya. It may be the case that he was responsible for torturing scores of dissidents, but one should bear in mind that the United Kingdom would actually send those dissidents to Gaddafi, knowing full well they would be tortured.

Making this corruption even juicier, former French leader Nicolas Sarkozy, the man who essentially had Gaddafi assassinated, was actually under investigation for having accepted 50 million euros from Gaddafi for his election campaign.

Are we supposed to trust these corrupt politicians to protect the interests of civilians?

To the warmongers within the American political establishment, the destruction of the Libyan way of life was nothing but a (hilarious) game.

As stated by Libyan medical student, Salem:

“We thought things would be better after the revolution, but they just keep getting worse and worse.

 

“Far more people have been killed since 2011 than during the revolution or under 42 years of Gaddafi’s rule combined.

 

“We never had these problems under Gaddafi.

 

“There was always money and electricity and, although people did not have large salaries, everything was cheap, so life was simple.

 

“Some of my friends have even taken the boat to Europe with the migrants because they feel there is no future for them here.

 

“I would like to escape this mess and study abroad but I have been waiting a year for a new passport and, even when I do get one, it will be hard to get a visa because all the embassies left in 2014.

 

“So now I feel like a prisoner in my own country. And I have started to hate my own country.”

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Savings Guarantee? U.N. Warns Next Financial Crisis Seems Imminent

“There remains a risk of deflationary spirals in which capital flight, currency devaluations and collapsing asset prices would stymie growth and shrink government revenues. As capital begins to flow out, there is now a real danger of entering a third phase of the financial crisis …”

UN Conference on Trade and Development’s Annual Report (UNCTAD), September 22, 2016

Image from “Extraordinary Popular Delusions and the Madness of Crowds” by Charles Mackay – Wikipedia

This hard hitting critique in the UN Conference on Trade and Development’s Annual Report, released this week, is suggesting that the ‘third leg of the world’s intractable depression is yet to come.’

“Alarm bells have been ringing over the explosion of corporate debt levels in emerging economies, which now exceed $25 trillion. Damaging deflationary spirals cannot be ruled out,” said the annual report of the UN Conference on Trade and Development (UNCTAD).

But what does these grand, scary predictions really mean for us? Bankruptcy? Economic collapse? Apocalypse now? End of the world as we know it?

The UN economists certainly think that a la 2007/2008, we are on the verge of the third leg of the global financial crisis – with prospect of epic debt defaults.

We may soon experience the end of the financial world as we know it … but investors and savers feel fine! Many bond and stock markets, including the S&P 500, continue on their merry way to all time record highs.

Few know, or (it seems) care anymore. As we end yet another week with yet another anticlimactic announcement from the “all powerful” Fed, it is understandable that many of us are feeling some cognitive dissonance when it comes to the real impact of central bank announcements, economic forecasts and political changes.

Bail-In Regime Cometh

There was one major ‘solution’ to the crisis that was announced in recent years with so much spin you would be forgiven for thinking it has little to do with you. When in truth you are the one who could be most affected.

In 2012 the release of a joint paper from the US Federal Deposit Scheme and the Bank of England included the words; “deposit schemes may have to contribute to the recapitalisation of a failed bank”. Bail-ins in the UK banking system had become a possibility.

This was made official by a “watershed” moment in 2014 when Mark Carney announced the end of the bail-out era, he was calling time on ‘too big to fail’ for banks.

“Let’s face it, the system we’ve had up until now has been totally unfair…The banks and their shareholders and their creditors got the benefit when things went well. But when they went wrong, the British public and subsequent generations picked up the bill – and that’s going to end.”

The media, politicians and until now, the general public fell for this. The promise of no more bailouts has resulted in feelings of reassurance that the taxpayer won’t be asked to foot the bill when irresponsible bankers mess up.

But this is fundamentally wrong. As we outline in a forthcoming report on bail-ins, the British public and subsequent generations are still going to be ‘picking up the bill’.

For the first time depositors in the form of retail savers and companies with capital, (who also happen to be taxpayers) will also be exposed in the event of governments bailing out banks again.

But what about the much supported Deposit Guarantee Scheme? It’s unlikely to last, or mean much when crunch time comes.

“It is not enough to have just a Deposit Guarantee Scheme [for a major bank rescue] if the losses are vast enough, then the haircuts imposed by the resolution authority can in principle permeate to any level of the creditor stack. In the case of insured deposits, that means Deposit Guarantee Schemes suffering losses …”

Paul Tucker, Deputy Governor Financial Stability of the Bank of England, October 2013

In the EU depositors are protected by some form of a deposit guarantee scheme, EUR100,000 or £75,000 for UK depositors, is protected in the event of bank failure. However, as we outline in our forthcoming report this amount or even any kind of insurance, is not guaranteed. Some politicians and think tanks are even recommending that deposit guarantee schemes be removed.

What does this mean in the context of a forthcoming third financial crisis and are your savings”guaranteed”?

Next week Our Guide to Bail-ins will outline how likely UK depositors are to being subject to bail-ins and how they can set about protecting themselves from bail-ins.

 

Gold and Silver Bullion – News and Commentary

Gold steady, set for biggest weekly gain in two months (Reuters)

Gold shines as dollar slips after Fed decision (Reuters)

Manufacturing behind decline in leading indicators in August (MarketWatch)

Sales of Existing U.S. Homes Unexpectedly Declined in August (Bloomberg)

Russia Targets China for Gold Sales as VTB, Sberbank Expan (Bloomberg)

Gold Sparkles as Central Bank Largesse Burnishes Investor Demand (Bloomberg)

Bank of Japan: we have complete control of the bond market (MoneyWeek)

Pension survival: in the worst case, your pot could fall 60pc in 15 years (Telegraph)

$195 Billion Asset Manager: “The Time Has Come To Leave The Dance Floor” (ZeroHedge)

America Is Not the Greatest Country on Earth. It’s No. 28 (Bloomberg)

Gold Prices (LBMA AM)

23 Sep: USD 1,335.90, GBP 1,027.17 & EUR 1,192.16 per ounce
22 Sep: USD 1,332.45, GBP 1,019.59 & EUR 1,186.68 per ounce
21 Sep: USD 1,319.60, GBP 1,015.96 & EUR 1,183.81 per ounce
20 Sep: USD 1,315.40, GBP 1,011.02 & EUR 1,175.84 per ounce
19 Sep: USD 1,315.05, GBP 1,007.99 & EUR 1,177.36 per ounce
16 Sep: USD 1,314.25, GBP 995.68 & EUR 1,170.08 per ounce
15 Sep: USD 1,320.10, GBP 998.26 & EUR 1,174.23 per ounce

Silver Prices (LBMA)

23 Sep: USD 19.82, GBP 15.28 & EUR 17.66 per ounce
22 Sep: USD 19.88, GBP 15.22 & EUR 17.69 per ounce
21 Sep: USD 19.43, GBP 14.95 & EUR 17.43 per ounce
20 Sep: USD 19.17, GBP 14.78 & EUR 17.15 per ounce
19 Sep: USD 19.12, GBP 14.65 & EUR 17.13 per ounce
16 Sep: USD 18.91, GBP 14.36 & EUR 16.85 per ounce
15 Sep: USD 18.96, GBP 14.32 & EUR 16.87 per ounce

Recent Market Updates

– Gold Up 1.5%, Silver Surges 3% – Yellen Stays Ultra Loose At 0.25%
– Trump and Clinton Are “Positive For Gold” – $1,900/oz by End of Year
– Gold Bugs Rejoice – Central Banks Think You’re On To Something
– ‘Hard’ Brexit Looms For Ireland
– EU Bail In Rules Ignored By Italy – Mother Of All Systemic Threats and World 
– War?– Buy Gold – Bonds Are ‘Biggest Bubble In World’ – Billionaire Singer Warns
– Silver Bullion Market – “Most Bullish Story Ever Told?”
– “Sorry, You Can’t Have Your Gold Bullion”
– Global Stocks, Bonds Fall Sharply – Gold Consolidates After Two Weeks Of Gains
– Gold, Silver, Blockchain and Fintech – Solutions To Negative Rates, Bail-ins, Cash Confiscations and Cashless Society
– Jan Skoyles Appointed Research Executive At GoldCore
– Silver Bullion Surges 3.5% To Over $20/oz
– Ireland “Especially Exposed” To “International Shocks” Warns Central Bank

via http://ift.tt/2daXUNt GoldCore

American University Professor, Allan Lichtman, has accurately predicted every U.S. presidential election since 1984 and now he’s calling 2016 for Trump.  Lichtman uses a system he calls the “Keys to the White House” which he developed after studying every election cycle from 1860 through 1980. 

Lichtman’s “Keys to the White House” are the following 13 true/false questions, where an answer of “true” always favors the re-election of the incumbent party, in this case, Hillary.  If, however, the answer to six or more of the 13 keys is “false” then the incumbent loses.

Here is how Lichtman answered his “13 Keys to the White House”:

1.  Party Mandate: After the midterm elections, the incumbent party holds more seats in the U.S. House of Representatives than after the previous midterm elections.

Lichtman Answer:  False – “They got crushed.”

 

2.  Contest: There is no serious contest for the incumbent party nomination.

Lichtman Answer:  True

 

3.  Incumbency: The incumbent party candidate is the sitting president.

Lichtman Answer:  False

 

4.  Third party: There is no significant third party or independent campaign.

Lichtman Answer:  False – “In his highest polling, Gary Johnson is at about 12 to 14 percent. My rule is that you cut it in half. That would mean that he gets six to seven.”

 

5.  Short-term economy: The economy is not in recession during the election campaign.

Lichtman Answer:  True

 

6.  Long-term economy: Real per capita economic growth during the term equals or exceeds mean growth during the previous two terms.

Lichtman Answer:  True

 

7.  Policy change: The incumbent administration effects major changes in national policy.

Lichtman Answer:  False – “No major policy change in Obama’s second term like the Affordable Care Act.”

 

8.  Social unrest: There is no sustained social unrest during the term.

Lichtman Answer:  True

 

9.  Scandal: The incumbent administration is untainted by major scandal.

Lichtman Answer:  True

 

10.  Foreign/military failure: The incumbent administration suffers no major failure in foreign or military affairs.

Lichtman Answer:  True

 

11.  Foreign/military success: The incumbent administration achieves a major success in foreign or military affairs.

Lichtman Answer:  False – “No major smashing foreign policy success.”

 

12.  Incumbent charisma: The incumbent party candidate is charismatic or a national hero.

Lichtman Answer:  False – “Hillary Clinton is not a Franklin Roosevelt.”

 

13.  Challenger charisma: The challenging party candidate is not charismatic or a national hero.

Lichtman Answer:  True

We would probably be more likely to argue that the answer to almost every one of those questions is “False” but we’ll take Lichtman’s word for it. 

But, while Lichtman predicted a Trump victory, he did hedge the prediction by pointing out that Trump is unlike any candidate this country has seen since 1860. 

“Donald Trump has made this the most difficult election to assess since 1984. We have never before seen a candidate like Donald Trump, and Donald Trump may well break patterns of history that have held since 1860.”

Here is his full interview with The Washington Post:

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

It has been a day of Friday afternoon surprises: just one hour after Ted Cruz pretended to endorse Donald Trump when he really meant don’t vote for Hillary, president Obama denied what all American citizens demanded – and got – after both chambers unanimously passed the Sept 11 law several weeks ago, when he decided to veto the Justice Against Sponsors of Terrorism Act bill.

As The Hill reports, Obama on Friday vetoed legislation that would allow families of 9/11 victims to sue Saudi Arabia in U.S courts, setting up a high-stakes showdown with Congress.  Obama’s move opens up the possibility that lawmakers could override his veto for the first time with a two-thirds vote in both chambers. Worse, it now appears – with reason  – that Obama has now sided not with the US population but with a small minority of Saudi emirs.

Republican and Democratic leaders have said they are committed to holding an override vote, and the bill’s drafters say they have the support to force the bill to become law.

The Justice Against Sponsors of Terrorism Act (JASTA) unanimously passed through both chambers by voice vote. 

But the timing of the president’s veto is designed to erode congressional support for the bill and put off a politically damaging override vote until after the November elections.  Obama waited until the very end of the 10-day period he had to issue a veto, hoping to buy time to lobby members of Congress against the measure. 

More details:

White House officials also hope congressional leaders will leave Washington to hit the campaign trail before trying for an override, kicking a vote to the lame-duck session after the election.

 

But Senate Majority Leader Mitch McConnell (R-Ky.) has said the upper chamber will remain in session until the veto override vote is done. Under current law, 9/11 victims’ families may sue a country designated as a state sponsor of terrorism, such as Iran. JASTA would allow U.S. citizens to sue countries without that designation, including Saudi Arabia.

The measure has touched a political nerve ahead of an election in which terrorism has emerged as a central issue. It has strong bipartisan support and is backed by 9/11 families’ organizations. 

Those families have sought damages from Saudi Arabia, since 15 of the 19 hijackers on Sept. 11, 2001 hailed from that country.  Critics have long been accused the Saudi government of directly or indirectly supporting the attacks, though a concrete link has never been proven.  

* * *

Obama has strongly opposed the legislation, arguing it would undermine sovereign immunity and open up U.S. diplomats and military service members to legal action overseas if foreign countries pass reciprocal laws.

But most of all, the administration is also wary of angering Saudi Arabia – one of the most generous donors to the Clinton Foundation and an alleged sponsor of Hillary’s presidential campaign – which is forcefully lobbying against the measure.

via http://ift.tt/2ctEC5j Tyler Durden