iftttwall

via http://ift.tt/2gX0kkS williambanzai7

Authored by Tsvetana Paraskova via OilPrice.com,

Conflict-torn Libya, divided between rival factions in the east and the west, recently reached 1 million bpd of crude oil output – for the first time since 2013.

The oil production recovery has put in the spotlight the chairman of Libya’s National Oil Corporation (NOC), Mustafa Sanalla, whom analysts see as a central figure in the oil sector, wearing the hats of both a diplomat and an oil minister. It will be Sanalla who will lead Libya’s delegation at the upcoming meeting of the Joint OPEC-Non-OPEC Ministerial Monitoring Committee (JMMC) in Russia, at which he will argue his country’s position and share production plans for the immediate future.  

And the monitoring committee will be eager to find out how much Libya’s plans could further offset the cartel and friends’ production cuts, from which the African nation is—for now at least—exempt.

Winning exemption at the time of the November OPEC deal wasn’t difficult for Libya, whose production was at the mercy of the civil strife and port blockades that plagued Libya over the past few years.

Libya’s production averaged 390,000 bpd throughout 2016 and 404,000 bpd in 2015, according to OPEC’s secondary sources. In the fourth quarter last year, output increased slightly to an average of 574,000 bpd.

Since then, the lifting of port seizures and blockades and the June interim deal with Germany’s Wintershall to immediately resume production in concession areas and related fields, which unblocked 160,000 bpd worth of output—has helped Libya to nearly double production.

The recovery of Libya and Nigeria’s crude oil production in the past two months has rekindled fears that rising supply from those two exempt African producers is offsetting a large part of the reductions and is depressing crude oil prices, alongside rising U.S. shale output.

Libya’s oil production recovery is the primary goal of NOC’s chairman Sanalla, who said in an opinion piece in the New York Times in June, referring to the country’s internal power struggles:  

“Between 2013 and last September, these blockaded nearly all of Libya’s main oil ports and tried to leverage that chokehold into ransom money and political power. That cost the country over $120 billion in lost revenues and most of its financial reserves.”

Arguing that the country’s oil and gas resources should not be held hostage to power struggles and fractious politics, Sanalla noted:

“Caught between those rivals, we at the N.O.C. intend to remain neutral until there is a single legitimate government we can submit to.”

Geoff Porter, founder of the North Africa Risk Consulting, said in an interview with Bloomberg, commenting on Sanalla’s role in the Libyan oil sector:

"His job is to produce as much oil as possible while he can and I think that’s what he is going to continue to try to do.”

However, years of neglect and attacks on facilities have damaged the output capacity, and infrastructure needs investments if Libya were to return to producing 1.6 million bpd, its output level before the 2011 revolution that toppled Muammar Ghaddafi.

Libya may be close to its capacity, and possibly has a short-term “implicit” ceiling of just above 1 million bpd, Mattia Toaldo, senior policy fellow at the European Council on Foreign Relations, told Bloomberg.

So Libya could ‘cap’ not because OPEC asks it to, but because of infrastructure limitations.  

Unlike fellow exempt producer Nigeria—which has signaled that it could cap production when its production reaches a stable 1.8 million bpd—Libya has not specified any output level for a possible ceiling.  

Last week, Sanalla told Reuters in comments sent via email:

“Libya’s political, humanitarian and economic situation needs to be taken into account if we are going to talk about production caps.”

 

“Accurate information will remove uncertainty and help the market understand and respond to future supply levels,” NOC’s chairman noted.  

The OPEC/non-OPEC monitoring committee will receive the latest updates regarding Libya’s production and plans—and get more information about expected supply from the cartel—at the OPEC meeting this weekend. Despite the fact that the monitoring committee is only making recommendations to the larger group, it may consider whether further actions are needed in view of the latest supply figures and forecasts for the coming months.

via http://ift.tt/2tU5E9V Tyler Durden

In this market where fundamentals long ago ceased to matter, and where positioning remains one of the few remaining sources of alpha, investors have been focusing on lists showing the most over and under-owned stocks. However, contrary to the narrative that the most heavily owned stocks outperform the most shorted, or underowned ones, and vice versa, recently BofA calculated that for the third year in a row, “the Top 10 most overbought stocks have trailed the S&P for each of the past three years, while the Top 10 “most neglected” stocks outperformed the S&P on average by 11.6%.”

This is what BofA’s quant team found:

As flows from active to passive funds have accelerated, one strategy that has worked unusually well for the last several years is a simple positioning trade of selling the 10 most overweight stocks and buying the 10 most underweight stocks by active managers. This single trade has yielded over 16ppt of alpha year-to-date. And implied derisking/ outflows on Brexit alone have been fierce, with the same strategy generating 5.2ppt of alpha just since last Thursday’s close. Even if Brexit’s impact on funds is limited from here, we believe that crowded stocks will likely continue to underperform neglected stocks: a whopping two-thirds of US large cap AUM still resides in active funds – there is likely a lot more to go in the rotation from active to passive.

Visually:

As such, a useful trading framework, would be to look at the Top 10 most crowded trades of active managers – on either side of the ledger – and to short the 10 most overweight, while going long the 10 most underweight stocks.

Conveniently UBS has updated its list of the Top 10 most crowded trades, revealing “where are the largest active positions.” How does UBS  measure the most active positions?

Using the institutional ownership data provided by FactSet, we form an active trading portfolio by aggregating positions across global active managers. Essentially, we sum up all the holdings in dollar value across all the active managers and calculate the weights of stocks in this active trading portfolio. We then compare this weight with the relevant equity index benchmark to form the active weight.

So, without further ado, here according to UBS are the Top 10 most crowded long and short trades, and not surprisingly, it’s all tech among the top 5 longs, which include Google, Alibaba, Amazon (a jump from 8th spot as of the last ranking), Facebook and Visa (with AAPL sliding into 6th spot), while on the short side one name stands out: Tesla in the perennial top slot, which may explain why no matter how bad the news, even the smallest glimmer of hope, whether a tweet from Elon Musk or an upgrade, prompts a sharp squeeze, like today for example.

Based on UBS data, this is how these two baskets have performed on a YTD basis:

Finally for those wondering, here is a breakdown of how levered hedge funds are as mid-July courtesy of JPM Pribe Brokerage. It will probably not come as a surprise that every single category has increased its leverage on a 3M, 6M and 12M basis.

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

Authored by James Howard Kunstler via Kunstler.com,

We are looking more and more like France on the eve of its revolution in 1789. Our classes are distributed differently, but the inequity is just as sharp. America’s “aristocracy,” once based strictly on bank accounts, acts increasingly hereditary as the vapid offspring and relations of “stars” (in politics, showbiz, business, and the arts) assert their prerogatives to fame, power, and riches – think the voters didn’t grok the sinister import of Hillary’s “it’s my turn” message?

What’s especially striking in similarity to the court of the Bourbons is the utter cluelessness of America’s entitled power elite to the agony of the moiling masses below them and mainly away from the coastal cities. Just about everything meaningful has been taken away from them, even though many of the material trappings of existence remain: a roof, stuff that resembles food, cars, and screens of various sizes.

But the places they are supposed to call home are either wrecked — the original small towns and cities of America — or replaced by new “developments” so devoid of artistry, history, thought, care, and charm that they don’t add up to communities, and are so obviously unworthy of affection, that the very idea of “home” becomes a cruel joke.

These places were bad enough in the 1960s and 70s, when the people who lived in them at least were able to report to paying jobs assembling products and managing their distribution. Now those people don’t have that to give a little meaning to their existence, or cover the costs of it. Public space was never designed into the automobile suburbs, and the sad remnants of it were replaced by ersatz substitutes, like the now-dying malls. Everything else of a public and human associational nature has been shoved into some kind of computerized box with a screen on it.

The floundering non-elite masses have not learned the harsh lesson of our time that the virtual is not an adequate substitute for the authentic, while the elites who create all this vicious crap spend millions to consort face-to-face in the Hamptons and Martha’s Vineyard telling each other how wonderful they are for providing all the artificial social programming and glitzy hardware for their paying customers.

The effect of this dynamic relationship so far has been powerfully soporific. You can deprive people of a true home for a while, and give them virtual friends on TV to project their emotions onto, and arrange to give them cars via some financing scam or other to keep them moving mindlessly around an utterly desecrated landscape under the false impression that they’re going somewhere — but we’re now at the point where ordinary people can’t even carry the costs of keeping themselves hostage to these degrading conditions.

The next big entertainment for them will be the financial implosion of the elites themselves as the governing forces of physics finally overcome all the ruses and stratagems of the elites who have been playing games with money. Professional observers never tires of saying that the government can’t run out of money (because they can always print more of it) but they can certainly destroy the value of that money and shred the consensual confidence that allows it to operate as money.

That’s exactly what is about to commence at the end of the summer when the government runs out of cash-on-hand and congress finds itself utterly paralyzed by party animus to patch the debt ceiling problem that disables new borrowing. The elites may be home from the Hamptons and the Vineyard by then, but summers may never be the same for them again.

The Deep State may win its war against the pathetic President Trump, but it won’t win any war against the imperatives of the universe and the way that expresses itself in the true valuation of things. And when the moment of clarification arrives — the instant of cosmic price discovery — the clueless elites will have to really and truly worry about the value of their heads.

via http://ift.tt/2v0u3Qd Tyler Durden

 

Emerging Markets ETF (EEM) has received a good deal of positive press for its performance off the 2016 lows. No doubt it has done well, as its is up around 50% off the lows of last year, while the S&P is up nearly 30%. This 18-month rally has caused many to tout how well Emerging markets are doing. For sure it has been a better place to be if one was spot on and bought the lows last year.

If one looks back a little further back into the returns since 2015, 2014, 2013 and 2011, buy & hold investors of this ETF don’t have much to brag about!

Below compares the performance of EEM to the S&P 500 since 2011

 

 

CLICK ON CHART TO ENLARGE

EEM peaked in 2011 at (1) and since then is still over 12% below those highs. It also peaked four different times at each (2). For those investors that bought at those highs, they are still underwater on the initial investment. No brag points here friends if one bought at those highs.

Now EEM is nearing heavy resistance line (2) at (3). Four different times EEM has created lower highs along line (2).

Will EEM “Run out of Gas” again at this key resistance zone or will it be different this time at (3)? What EEM does at this heavy resistance zone, could send an important message to world markets and the S&P 500!

 

 

 

 

This information is coming to you from Kimble Charting Solutions.  We strive to produce concise, timely and actionable chart pattern analysis to save people time, improve your decion-making and results

Send us an email if you would like to see sample reports or a trial period to test drive our Premium or Weekly Research

 

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Introduction by Vince Lanci

Originally posted on marketslant.com

Here is yet more proof of what happens when slow, methodical planning, manufactured consent, and corporate influence combine their forces. The result is an unholy union between academic ideologists, political puppets, and corporate greed manifested in what can only be described as a juggernaut; A slow, relentlessly moving object that will crush anything in its path. Note juggernauts are also prone to crushing their devotees as well. 

Per Wikipedia

A juggernaut  in current English usage, is a literal or metaphorical force regarded as mercilessly destructive and unstoppable. This usage originated in the mid-nineteenth century[2] as an allegorical reference to the Hindu temple cars of Jagannath Temple in Puri, which apocryphally were reputed to crush devotees under their wheels.

When you have political, capitalistic, and ideological forces aligned; you get economic, political, and technological forces almost religiously agreeing on a course  of action. In this case, Multiculturalist Ideology, Government Shills, and New Tech can now make their play on creating an even more captive consumer / sheeple. 

Visa’s Pitch to India

And among the people championing the convenience of a cashless society are those who use  iphones to buy Starbucks coffee. These devotees who will sacrifice freedom for convenience will not be spared. They will be crushed under the juggernaut when alternate choices of transacted commerce are eliminated.

Kind of like the middle class thinking Trump was going to help them. Or the bitter left that thought Hillary was actually liberal. There are only degrees of authoritarianism now. And those in power are the elitists who state they know what is best for you. It also happens to be what is best for them. And cash – or more correctly control of how cash is spent – is an obstacle to that

There is nowhere to hide. The cashless society is coming, and with it, your freedom to spend where and when you see fit. Your ability to get fair prices from open trade borders will be closed. And when you convert your paper to Gold, that will be attacked next. 

And those  people using Bitcoin to transfer wealth out of countries to retain their economic freedom we say  this; What are you going to transfer your wealth into? Are you going to leave it in Bitcoins? Then enjoy 100% volatility.

Risk cannot be created or destroyed, it can only be  exchanged for different risk. The wall is being built alright. It is being built around your economic freedom. Then the cries of BUY AMERICAN will sound out,  as you will not be able to buy anywhere  else. And American corporations will own your spending habits. Do you think supermarkets want to make less money when they ask for your “Club Card”?

You should be very scared when a bank spokesperson feels confident enough to actually say what he did. That means he thinks its a done deal. That headline is an actual quote. 

– VBL

Banks Are Scheming to Dominate a Future Cashless Society

Written by Shaun Bradley for theantimedia.org

Visa recently announced its new Cashless Challenge program, which offers $10,000 to restaurants willing to transition into accepting only digital payments.  As the largest credit card processor in the U.S., it’s no surprise Visa is spearheading this campaign. Under the guise of increasing transparency and efficiency, they’ve partnered with governments around the world to help convert financial systems into cashless models, but their real incentive is the billions of dollars in extra transaction fees it would generate.

“We are declaring war on cash,” Visa spokesman Andy Gerlt proudly proclaimed after the program was announced.

The food-based small businesses Visa is targeting are among those that benefit most from accepting cash from customers. When transactions are for amounts less than $10, the fees charged cut significantly into profits. Only 28% of food trucks currently accept credit card payments because of the huge losses they incur from them. The bribe from Visa may seem appealing up front but will be mostly paid back to them over the next few years in fees alone.

Liz Garner, Vice President of the Merchant Advisory Group, which represents over 100 of the largest businesses in the U.S., explained some of the hurdles faced when dealing with card networks:

“For many businesses – both large and small – the cost of accepting plastic cards and other forms of electronic payments is one of their highest operating costs. Most business owners have no qualms about paying reasonable fees for business services, and they do so every day for items such as cleaning services, security systems, Wi-Fi, and other basic needs. However, they have the ability to negotiate for those services in a fair and transparent marketplace, which they do not with the two major credit and debit card networks….Credit card and debit card fees are dictated directly by Visa and MasterCard and are imposed on the majority of merchants in a take-it-or-leave-it fashion. Most businesses feel that failing to accept these major card brands is not a competitive option so they continue accepting electronic payments even though the costs are squeezing their business, and the inflexible acceptance rules fly in the face of free market enterprise,”

This ongoing push for a cashless society in Europe, Asia, and the Americas is about much more than just phasing out paper money — it’s about central planners solidifying control over the public’s wealth. This ongoing merger of corporate and government interests is the definition of crony capitalism. Regardless of the blatant collusion, the choices individuals make will still ultimately decide the direction for the future. Buying material goods on credit has become a lifestyle for millions, but the long-term costs of those decisions must be understood if there’s any chance for progress.

Americans have made a huge mistake by running up a staggering $1 trillion dollars in credit card debt with an average interest rate of over 16%. Thanks to the Federal Reserve system, companies like Mastercard, Discover, and American Express can issue bonds paying extremely low-interest rates to the investors while simultaneously lending that money out to credit card holders at sky high rates. Companies will always take advantage of opportunities to increase profits, but the people’s willingness to keep borrowing from them is at the core of the problem.

Access to cheap capital has been extended to the largest corporations for over a decade, but when it comes to small businesses or individuals there is a completely different set of standards. The pressure to consistently increase revenues and stock prices has led to an unnatural parasitic relationship between these companies and their customers. Cash is one of the last options that allows people a way to avoid dealing with this kind of shakedown.

More than 

30% of all payments

 in the U.S. are still conducted in cash, but 

financial intermediaries

 that charge processing fees are 

joining

 with the State and central banks to ensure the public has no room to innovate. Credit and debit cards have been the most convenient way to make purchases for over a decade, but emerging competition is slowly making them irrelevant.

Bitcoin and smart contract platforms have introduced an entirely new marketplace for businesses and individuals outside the dominion of the old financial vanguard. Dozens of large corporations have founded the Enterprise Ethereum Alliance to build support for other developing alternative blockchain technologies aside from Bitcoin. This ongoing evolution towards peer-to-peer payments will eventually doom companies like Visa to the same fate as Blockbuster. Those in power may champion the benefits of going cashless, but going bankless may be the only way out of this extortion matrix.

The efforts by governments and the financial industry to eliminate cash are only going to intensify. Those who adapt to the new paradigm of peer-to-peer payments will thrive, while those who don’t will have their hard earned money extracted to support a failing system. The illusion of banks being safe should have been shattered after the 2008 crisis, but eventually, the reality of how unstable the current institutions are will become apparent. Educating entrepreneurs and businesses on the benefits of Bitcoin and other decentralized options is the only way to shift this economy away from the control of central planners and towards a free and voluntary market.

via http://ift.tt/2vBw0j6 Vince Lanci

It seems Morgan Stanely was right when they said "the debt ceiling worries us most," as today's 3-month T-Bill auction surprised the market with its highest yield since the fall of 2008, as investors continue to price concerns that the U.S. government will exhaust its borrowing authority around mid-October.

As SMRA details:

The 3-month bill auction stopped at 1.180%, with a 67.70% allocation at the high yield. The 3-month auction bid/cover ratio was 2.87. The average 3-month bid/cover over the past three months was 3.13. The WI was last trading at 1.165% at 11:30 AM. Indirect bidders took down 38.44% of the 3-month bill auction and Direct bidders took down 5.61%.

 

The 6-month bill auction stopped at 1.130%, with a 34.87% allocation at the high yield. The 6-month auction bid/cover ratio was 2.91. The average 6-month bid/cover over the past three months was 3.30. The WI was last trading at 1.115% at 11:30AM. Indirect bidders took down 40.66% of the 6-month bill auction and Direct bidders took down 2.69%.

So the 3-month bill is priced 5bps cheaper than the 6-month bill and both dramatically tailed.

As BofA noted, the early pricing of debt limit concerns may reflect overhang from this week’s bill auctions and the "greater influence" of government money market funds following October's reforms.

But, Morgan Stanley recently warned that the biggest immediate risk to the market is:

The debt ceiling worries us most, given that action may need to be taken within as little as seven weeks. But on the other issues, we’re more relaxed. The Senate’s Healthcare bill had an approval rating of 17%, so we doubt its failure would be a hit to consumer confidence. The Special Counsel’s investigation, whatever the outcome, will likely take considerable time. Our economic baseline was already cautious with regard to fiscal stimulus, a long-held view of our policy team. And while tax cuts could boost the market temporarily, they could also lead to a more hawkish Fed, a classic ‘be careful what you wish for.’

As the 3mo6mo yield curve inverts dramatically…

 

Inflecting right around the mid-October date of today's auction…

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

Preface by Washington's Blog: We asked top NSA whistleblower Bill Binney what he thought about a report claiming that the DNC emails were transferred too quickly to have been accessed by a hacker, and could only have been copied by a DNC leaker. This article is his response.   Background here and here.

MEMORANDUM FOR: The President

FROM: Veteran Intelligence Professionals for Sanity (VIPS)

SUBJECT: Was the “Russian Hack” an Inside Job?

Executive Summary

Forensic studies of “Russian hacking” into Democratic National Committee computers last year reveal that on July 5, 2017, data was leaked (not hacked) by a person with physical access to DNC computers, and then doctored to incriminate Russia.

After examining metadata from the “Guccifer 2.0” July 5, 2016 intrusion into the DNC server, independent cyber investigators have concluded that an insider copied DNC data onto an external storage device, and that “telltale signs” implicating Russia were then inserted.

Key among the findings of the independent forensic investigations is the conclusion that the DNC data was copied onto a storage device at a speed that far exceeds an Internet capability for a remote hack. Of equal importance, the forensics show that the copying and doctoring were performed on the East coast of the U.S. Thus far, mainstream media have ignored the findings of these independent studies [see here and here].

Independent analyst Skip Folden, a retired IBM Program Manager for Information Technology US, who examined the recent forensic findings, is a co-author of this Memorandum. He has drafted a more detailed technical report titled “Cyber-Forensic Investigation of ‘Russian Hack’ and Missing Intelligence Community Disclaimers,” and sent it to the offices of the Special Counsel and the Attorney General. VIPS member William Binney, a former Technical Director at the National Security Agency, and other senior NSA “alumni” in VIPS attest to the professionalism of the independent forensic findings.

The recent forensic studies fill in a critical gap. Why the FBI neglected to perform any independent forensics on the original “Guccifer 2.0” material remains a mystery – as does the lack of any sign that the “hand-picked analysts” from the FBI, CIA, and NSA, who wrote the “Intelligence Community Assessment” dated January 6, 2017, gave any attention to forensics.

NOTE: There has been so much conflation of charges about hacking that we wish to make very clear the primary focus of this Memorandum. We focus specifically on the July 5, 2016 alleged Guccifer 2.0 “hack” of the DNC server. In earlier VIPS memoranda we addressed the lack of any evidence connecting the Guccifer 2.0 alleged hacks and WikiLeaks, and we asked President Obama specifically to disclose any evidence that WikiLeaks received DNC data from the Russians [see here and here].

Addressing this point at his last press conference (January 18), he described “the conclusions of the intelligence community” as “not conclusive,” even though the Intelligence Community Assessment of January 6 expressed “high confidence” that Russian intelligence “relayed material it acquired from the DNC … to WikiLeaks.”

Obama’s admission came as no surprise to us. It has long been clear to us that the reason the U.S. government lacks conclusive evidence of a transfer of a “Russian hack” to WikiLeaks is because there was no such transfer. Based mostly on the cumulatively unique technical experience of our ex-NSA colleagues, we have been saying for almost a year that the DNC data reached WikiLeaks via a copy/leak by a DNC insider (but almost certainly not the same person who copied DNC data on July 5, 2016).

From the information available, we conclude that the same inside-DNC, copy/leak process was used at two different times, by two different entities, for two distinctly different purposes:

-(1) an inside leak to WikiLeaks before Julian Assange announced on June 12, 2017, that he had DNC documents and planned to publish them (which he did on July 22) – the presumed objective being to expose strong DNC bias toward the Clinton candidacy; and

-(2) a separate leak on July 5, 2016, to pre-emptively taint anything WikiLeaks might later publish by “showing” it came from a “Russian hack.”

*  *  *

Mr. President:

This is our first VIPS Memorandum for you, but we have a history of letting U.S. Presidents know when we think our former intelligence colleagues have gotten something important wrong, and why. For example, our first such memorandum, a same-day commentary for President George W. Bush on Colin Powell’s U.N. speech on March 5, 2003, warned that the “unintended consequences were likely to be catastrophic,” should the U.S. attack Iraq and “justfy” the war on intelligence that we retired intelligence officers could readily see as fraudulent and driven by a war agenda.

The January 6 “Intelligence Community Assessment” by “hand-picked” analysts from the FBI, CIA, and NSA seems to fit into the same agenda-driven category. It is largely based on an “assessment,” not supported by any apparent evidence, that a shadowy entity with the moniker “Guccifer 2.0” hacked the DNC on behalf of Russian intelligence and gave DNC emails to WikiLeaks.

The recent forensic findings mentioned above have put a huge dent in that assessment and cast serious doubt on the underpinnings of the extraordinarily successful campaign to blame the Russian government for hacking. The pundits and politicians who have led the charge against Russian “meddling” in the U.S. election can be expected to try to cast doubt on the forensic findings, if they ever do bubble up into the mainstream media. But the principles of physics don’t lie; and the technical limitations of today’s Internet are widely understood. We are prepared to answer any substantive challenges on their merits.

You may wish to ask CIA Director Mike Pompeo what he knows about this. Our own lengthy intelligence community experience suggests that it is possible that neither former CIA Director John Brennan, nor the cyber-warriors who worked for him, have been completely candid with their new director regarding how this all went down.

Copied, Not Hacked

As indicated above, the independent forensic work just completed focused on data copied (not hacked) by a shadowy persona named “Guccifer 2.0.” The forensics reflect what seems to have been a desperate effort to “blame the Russians” for publishing highly embarrassing DNC emails three days before the Democratic convention last July. Since the content of the DNC emails reeked of pro-Clinton bias, her campaign saw an overriding need to divert attention from content to provenance – as in, who “hacked” those DNC emails? The campaign was enthusiastically supported by a compliant “mainstream” media; they are still on a roll.

“The Russians” were the ideal culprit. And, after WikiLeaks editor Julian Assange announced on June 12, 2016, “We have emails related to Hillary Clinton which are pending publication,” her campaign had more than a month before the convention to insert its own “forensic facts” and prime the media pump to put the blame on “Russian meddling.” Mrs. Clinton’s PR chief Jennifer Palmieri has explained how she used golf carts to make the rounds at the convention. She wrote that her “mission was to get the press to focus on something even we found difficult to process: the prospect that Russia had not only hacked and stolen emails from the DNC, but that it had done so to help Donald Trump and hurt Hillary Clinton.”

Independent cyber-investigators have now completed the kind of forensic work that the intelligence assessment did not do. Oddly, the “hand-picked” intelligence analysts contented themselves with “assessing” this and “assessing” that. In contrast, the investigators dug deep and came up with verifiable evidence from metadata found in the record of the alleged Russian hack.

They found that the purported “hack” of the DNC by Guccifer 2.0 was not a hack, by Russia or anyone else. Rather it originated with a copy (onto an external storage device – a thumb drive, for example) by an insider. The data was leaked after being doctored with a cut-and-paste job to implicate Russia. We do not know who or what the murky Guccifer 2.0 is. You may wish to ask the FBI.

The Time Sequence

June 12, 2016: Assange announces WikiLeaks is about to publish “emails related to Hillary Clinton.”

June 15, 2016: DNC contractor Crowdstrike, (with a dubious professional record and multiple conflicts of interest) announces that malware has been found on the DNC server and claims there is evidence it was injected by Russians.

June 15, 2016: On the same day, “Guccifer 2.0” affirms the DNC statement; claims responsibility for the “hack;” claims to be a WikiLeaks source; and posts a document that the forensics show was synthetically tainted with “Russian fingerprints.”

We do not think that the June 12 & 15 timing was pure coincidence. Rather, it suggests the start of a pre-emptive move to associate Russia with anything WikiLeaks might have been about to publish and to “show” that it came from a Russian hack.

The Key Event

July 5, 2016: In the early evening, Eastern Daylight Time, someone working in the EDT time zone with a computer directly connected to the DNC server or DNC Local Area Network, copied 1,976 MegaBytes of data in 87 seconds onto an external storage device. That speed is many times faster than what is physically possible with a hack.

It thus appears that the purported “hack” of the DNC by Guccifer 2.0 (the self-proclaimed WikiLeaks source) was not a hack by Russia or anyone else, but was rather a copy of DNC data onto an external storage device. Moreover, the forensics performed on the metadata reveal there was a subsequent synthetic insertion – a cut-and-paste job using a Russian template, with the clear aim of attributing the data to a “Russian hack.” This was all performed in the East Coast time zone.

“Obfuscation & De-obfuscation”

Mr. President, the disclosure described below may be related. Even if it is not, it is something we think you should be made aware of in this general connection. On March 7, 2017, WikiLeaks began to publish a trove of original CIA documents that WikiLeaks labeled “Vault 7.” WikiLeaks said it got the trove from a current or former CIA contractor and described it as comparable in scale and significance to the information Edward Snowden gave to reporters in 2013.

No one has challenged the authenticity of the original documents of Vault 7, which disclosed a vast array of cyber warfare tools developed, probably with help from NSA, by CIA’s Engineering Development Group. That Group was part of the sprawling CIA Directorate of Digital Innovation – a growth industry established by John Brennan in 2015.

Scarcely imaginable digital tools – that can take control of your car and make it race over 100 mph, for example, or can enable remote spying through a TV – were described and duly reported in the New York Times and other media throughout March. But the Vault 7, part 3 release on March 31 that exposed the “Marble Framework” program apparently was judged too delicate to qualify as “news fit to print” and was kept out of the Times.

The Washington Post’s Ellen Nakashima, it seems, “did not get the memo” in time. Her March 31 article bore the catching (and accurate) headline: “WikiLeaks’ latest release of CIA cyber-tools could blow the cover on agency hacking operations.”

The WikiLeaks release indicated that Marble was designed for flexible and easy-to-use “obfuscation,” and that Marble source code includes a “deobfuscator” to reverse CIA text obfuscation.

More important, the CIA reportedly used Marble during 2016. In her Washington Post report, Nakashima left that out, but did include another significant point made by WikiLeaks; namely, that the obfuscation tool could be used to conduct a “forensic attribution double game” or false-flag operation because it included test samples in Chinese, Russian, Korean, Arabic and Farsi.

The CIA’s reaction was neuralgic. Director Mike Pompeo lashed out two weeks later, calling Assange and his associates “demons,” and insisting, “It’s time to call out WikiLeaks for what it really is, a non-state hostile intelligence service, often abetted by state actors like Russia.”

Mr. President, we do not know if CIA’s Marble Framework, or tools like it, played some kind of role in the campaign to blame Russia for hacking the DNC. Nor do we know how candid the denizens of CIA’s Digital Innovation Directorate have been with you and with Director Pompeo. These are areas that might profit from early White House review.

Putin and the Technology

We also do not know if you have discussed cyber issues in any detail with President Putin. In his interview with NBC’s Megyn Kelly, he seemed quite willing – perhaps even eager – to address issues related to the kind of cyber tools revealed in the Vault 7 disclosures, if only to indicate he has been briefed on them. Putin pointed out that today’s technology enables hacking to be “masked and camouflaged to an extent that no one can understand the origin” [of the hack] … And, vice versa, it is possible to set up any entity or any individual that everyone will think that they are the exact source of that attack.”

“Hackers may be anywhere,” he said. “There may be hackers, by the way, in the United States who very craftily and professionally passed the buck to Russia. Can’t you imagine such a scenario? … I can.”

Full Disclosure: Over recent decades the ethos of our intelligence profession has eroded in the public mind to the point that agenda-free analysis is deemed well nigh impossible. Thus, we add this disclaimer, which applies to everything we in VIPS say and do: We have no political agenda; our sole purpose is to spread truth around and, when necessary, hold to account our former intelligence colleagues.

We speak and write without fear or favor. Consequently, any resemblance between what we say and what presidents, politicians and pundits say is purely coincidental. The fact we find it is necessary to include that reminder speaks volumes about these highly politicized times. This is our 50^th VIPS Memorandum since the afternoon of Powell’s speech at the UN. Live links to the 49 past memos can be found at http://ift.tt/1S8koLL.

FOR THE STEERING GROUP, VETERAN INTELLIGENCE PROFESSIONALS FOR SANITY

William Binney, former NSA Technical Director for World Geopolitical & Military Analysis; Co-founder of NSA’s Signals Intelligence Automation Research Center

Skip Folden, independent analyst, retired IBM Program Manager for Information Technology US (Associate VIPS)

Matthew Hoh, former Capt., USMC, Iraq & Foreign Service Officer, Afghanistan (associate VIPS)

Michael S. Kearns, Air Force Intelligence Officer (Ret.), Master SERE Resistance to Interrogation Instructor

John Kiriakou, Former CIA Counterterrorism Officer and former Senior Investigator, Senate Foreign Relations Committee

Linda Lewis, WMD preparedness policy analyst, USDA (ret.)

Lisa Ling, TSgt USAF (ret.) (associate VIPS)

Edward Loomis, Jr., former NSA Technical Director for the Office of Signals Processing

David MacMichael, National Intelligence Council (ret.)

Ray McGovern, former U.S. Army Infantry/Intelligence officer and CIA analyst

Elizabeth Murray, former Deputy National Intelligence Officer for Middle East, CIA

Coleen Rowley, FBI Special Agent and former Minneapolis Division Legal Counsel (ret.)

Cian Westmoreland, former USAF Radio Frequency Transmission Systems Technician and Unmanned Aircraft Systems whistleblower (Associate VIPS)

Kirk Wiebe, former Senior Analyst, SIGINT Automation Research Center, NSA

Sarah G. Wilton, Intelligence Officer, DIA (ret.); Commander, US Naval Reserve (ret.)

Ann Wright, U.S. Army Reserve Colonel (ret) and former U.S. Diplomat

 

via http://ift.tt/2eHEelP George Washington

Prompted by growing interest among the hedge fund community, Goldman is dedicating increasingly more “bandwidth” to covering bitcoin, and judging by the bank’s bullish bias, most of the “smart money” appears to be long the cryptocurrency.

In a report posted overnight by Goldman’s chief technician Sheba Jafari, she writes that since “Bitcoin is still within the limits of a well-defined range, it may need another few swing within the range before resuming its underlying trend” higher. Eventually, after some potential volatility that could send it as low as $1,786 “but not much further from there”, Goldman expects the original cryptocurrency to surge to a “minimum target at 2,988 and scope to reach 3,691.“

Here is the full text of how Goldman reassures its nervous clients, many of whom appear to have bought BTC near its recent all time highs, that record highs in  bitcoin are just a matter of time:

• As has been discussed in recent updates, Bitcoin is in wave IV of a V wave impulsive rally that began at the ‘11 low. It’s not uncommon for a 4th wave to be complex and time-consuming.
• The fact that the market is still unable to break above the key day high on Jun. 13th (3,000) increases the likelihood of this being a triangle. These triangles are typically characterized by five swings in either direction, making it an ABCDE sequence. If this is the correct interpretation, the next leg lower should retrace back towards the bottom of wave A (1,852) but no further than there.
• Alternatively, it could also be an ABC pattern in which case the market could make a marginal new low –to ~1,786—but again, not much further than there.
• Anything above 3,000 (Jun. 13th high) will suggest potential to have already started wave V, which again has a minimum target at 2,988 and scope to reach 3,691 (the latter being a preferred target as this assumes a new high). At this point, it seems reasonable to assume that the market is in a corrective process until there’s been real evidence of an impulsive advance.

Jafari’s conclusion: “Consider range-bound/corrective below 3,000. Shouldn’t retrace much further than 1,857-1,787. Eventually see potential for 3,691.”

While Goldman’s sellside euphoria on bitcoin is tangible, one wonders if this is just the latest attempt by its prop desk to offload some holdings to institutional and retail traders who are a little late to the crypto party.

via http://ift.tt/2gXebI6 Tyler Durden