China’s 2nd Biggest Bitcoin Exchange Responds To Report Beijing Is Shutting All Virtual Exchanges

One day after Bitcoin crashed on a massive surge in volume, following a report in China’s Caixin website that Chinese authorities plan to shut local Bitcoin exchanges….

… there is still far more confusion than clarity about what is really going on in China: so far there has been no official statement from either the PBOC or China’s financial regulator, confirming or denying the report, which spooked millions of Chinese bitcoin (and ethereum and litecoin) holders into dumping their digital currencies. As a reminder, this is the gist of the Caixin report:

The central government’s office overseeing internet financial risks has ordered local authorities to shut down virtual exchanges trading digital currencies with the yuan, a source close to the office told Caixin. The order will affect major Bitcoin platforms such as OKCoin, Huobi and BTC China.

To be sure, it’s not like a Chinese government bureaucracy to i) allow such a major leak and ii) not make a validating (or denying) statement over a day later.

The confusion was further exacerbated by the report’s seeming contradictions, as in the same report that claimed Chinese Bitcoin exchanges would be halted, also said that the proposed regulation (which has yet to be unveiled) is not meant to be a crackdown on bitcoin itself or actual trading: “the source added that the crackdown targets unauthorized trading at virtual currency exchanges, rather than Bitcoin and the underlying blockchain technology.”

So until we wait an official statement from Beijing, which risks the wrath of millions of bitcoin daytraders should it confirming the Caixin trial balloon, moments ago China’s second biggest bitcoin exchange, BTC China issued the following statement in response to the Caixin report:

BTCChina Response to News Article On “Banning Bitcoin Exchanges”

 

We have received a large number of questions from customers following the publication of a news article by Caixin alleging that Chinese regulators would stop bitcoin trading

 

Our response is as follows:

 

  • BTCChina operates in strict accordance with Chinese regulations. If the Caixin report is accurate, we will continue acting in strict accordance with regulators, and continue protecting the safety of customers’ funds.
  • The Caixin report says that regulators have not said bitcoin itself is illegal, and have not decided to prohibit private, one-on-one bitcoin transactions. If the report is accurate, BTCChina will stop all BTC/CNY trading, and change its business model to become an information service provider for private, one-on-one digital asset trading.

 

Many people regard digital assets, of which bitcoin is the embodiment, as the necessary result of recent advances in internet technology and the largest scale practical application of blockchain technology. In additional, bitcoin’s blockchain may have a far-reaching positive impact on the economy, becoming a foundational layer upon which other revolutionary software projects are based. We believe digital assets will have a far-reaching impact on the global economy.

 

BTCChina thanks you for your support, and will continue working to provide the best service for all customers.

 

BTCChina

 

Saturday, September 9th, 2017

What is notable about BTC China’s response, aside from its promise to pivot its business model should Caixin’s report be accurate, is that it appears that there has yet to be any official confirmation. Could someone be using the highly respected financial outlet as a fake “trial balloon” to push the price of bitcoin lower and load up on the cheap before the PBOC denies the late Friday report? We should know the answer by Monday.

Meanwhile, it is worth noting that while China was once the world’s largest Bitcoin marketplace, accounting for nearly 90% of global trading, this was followed by a series of crackdowns and regulations: as these tightened, China’s share in bitcoin trading has slid to less than a third of global trading. The three largest exchanges, OKCoin, BTC China and Huobi, account for 60% of Bitcoin trading in the country.

Bitcoin value traded at Huobi and BTC China declined nearly 20% to around 23,000 yuan as of Friday night. Bitcfinex remains the most active and popular bitcoin exchange in the world.

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Republicans Furious After Trump’s DOJ Declines To Charge Lois Lerner

In what amounts to another act of inexcusable negligence by the Department of Justice, former IRS bureaucrat Lois Lerner – the woman who President Barack Obama put in charge of weaponizing the agency as a tool to suppress Tea Party groups – has escaped being charged for her role in the wide-ranging conspiracy, which involved at least five other employees.

The decision is the culmination of five years of lawsuits brought by conservative groups against Lerner and the IRS, which successfully forced the agency to release the names of 426 nonprofit groups that were systematically targeted for additional scrutiny. The scandal was first disclosed to the public in 2012, but evidence obtained by conservative groups revealed that Lerner and another high-ranking IRS official knew about it years before.

Predictably, conservatives are outraged by the decision – a rage that’s compounded by the DOJ’s reluctance to investigate former FBI Director James Comey and former Attorney General Loretta Lynch for possibly colluding to quash the investigation into Hillary Clinton’s mishandling of classified information, though Congress has nominally launched an investigation into the latter.

In the following statement, Judicial Watch President Tom Fitton asked that Trump intervene and order a complete review of the scandal:

“I have zero confidence that the Justice Department did an adequate review of the IRS scandal. In fact, we’re still fighting the Justice Department and the IRS for records about this very scandal. Today’s decision comes as no surprise considering that the FBI collaborated with the IRS and is unlikely to investigate or prosecute itself.

 

President Trump should order a complete review of the whole issue. Meanwhile, we await accountability for IRS Commissioner Koskinen, who still serves and should be drummed out of office.”

In a news release about the decision, Judicial Watch recounted how litigation forced the IRS first to say that emails belonging to Lerner were supposedly missing and later declare to the court that the emails were on IRS back-up systems, exposing a proliferation of “record-keeping problems” at the agency.

Here’s a timeline of civil actions and disclosures related to the scandal:

In June 2014, the IRS claimed to have “lost” responsive emails belonging to Lerner and other IRS officials.

 

In July 2014 Judge Emmett Sullivan ordered the IRS to submit to the court a written declaration under oath about what happened to Lerner’s “lost” emails. The sworn declarations proved to be less than forthcoming.

 

In August 2014, Department of Justice attorneys for the IRS finally admitted Judicial Watch that Lerner’s emails, indeed all government computer records, are backed up by the federal government in case of a government-wide catastrophe. The IRS’ attorneys also disclosed that Treasury Inspector General for Tax Administration (TIGTA) was looking at several of these backup tapes.

 

In November 2014, the IRS told the court it had failed to search any of the IRS standard computer systems for the “missing” emails of Lerner and other IRS officials.

 

On February 26, 2015, TIGTA officials testified to the House Oversight and Government Reform Committee that it had received 744 backup tapes containing emails sent and received by Lerner.  This testimony showed that the IRS had falsely represented to both Congress, Judge Sullivan, and Judicial Watch that Lerner’s emails were irretrievably lost. The testimony also revealed that IRS officials responsible for responding to the document requests never asked for the backup tapes and that 424 backup tapes containing Lerner’s emails had been destroyed during the pendency of Judicial Watch’s lawsuit and Congressional investigations.

 

In June 2015, Judicial Watch forced the IRS to admit in a court filing that it was in possession of 6,400 “newly discovered” Lerner emails. Judge Emmet Sullivan ordered the IRS to provide answers on the status of the Lerner emails the IRS had previously declared lost. Judicial Watch raised questions about the IRS’ handling of the missing emails issue in a court filing, demanding answers about Lerner’s emails that had been recovered from the backup tapes.

 

In July 2015, U.S District Court Judge Emmet Sullivan threatened to hold John Koskinen, the commissioner of the Internal Revenue Service, and Justice Department attorneys in contempt of court after the IRS failed to produce status reports and recovered Lerner emails, as he had ordered on July 1, 2015.”

According to the Washington Examiner, after being asked by Republicans in April to take a "fresh look" at the case against Lerner, the Trump administration responded Friday that it had reviewed the case and decided against it.

Some Republicans in Congress openly questioned Attorney General Jeff Sessions’s judgment:

"[T]he Department determined that reopening the criminal investigation would not be appropriate based on the available evidence," Assistant Attorney General Stephen Boyd wrote in a letter to Kevin Brady, the chairman of the House Ways and Means Committee.

Boyd added that the department had "carefully reviewed" its original 2015 decision not to prosecute, and had new attorneys independently review the investigation. He said that to convict Lerner, it would be necessary to prove that she intentionally discriminated against the groups based on their political views.

"I assure you that the Department has carefully studied the law, given the evidence the utmost consideration, and thoroughly reviewed the prior investigation from an objective perspective," he wrote.

 

In his response, Ways and Means Chairman Brady called it a "terrible decision" that suggested political appointees were not being held accountable under the law.

 

"I have the utmost respect for Attorney General [Jeff] Sessions, but I'm troubled by his Department's lack of action to fully respond to our request and deliver accountability," the Texas lawmaker said in a statement.

 

Peter Roskam, chairman of the House’s tax subcommittee, also criticized the decision, calling it "a miscarriage of justice."

Lawmakers had previously suggested that the Obama Department of Justice had declined to prosecute Lerner in 2015 because it was taking political cues from Obama. In 2014, their committee had voted to refer Lerner to the Justice

Department for prosecution for her role in the targeting scandal. Now Obama is gone, but the DOJ continues to protect his henchmen. The DOJ’s excuse –  used many times recently – that proving intent would be too difficult, seems flimsy.

Not to mention being a political black eye for an administration already struggling to appease Republicans in Congress.
 

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Death By Political Correctness: Student Charged With Islamaphobic “Hate Crime” After Mocking ISIS On Facebook

Authored b y Jon Hall via Free Market Shooter blog,

Robbie Travers, a 21-year-old law student, is being investigated by the University of Edinburgh for claims he committed a “hate crime”.

Sharing a comment on his Facebook page – in response to the U.S. Air Force dropping a massive ordinance air blast (or MOAB, “Mother Of All Bombs) on a network of ISIS tunnels in Afghanistan in April – Travers said:

“Excellent news that the US administration and Trump ordered an accurate strike on an ISIS network of tunnels in Afghanistan. I’m glad we could bring these barbarians a step closer to collecting their 72 virgins.”

A complaint with the University was filed by a second-year history student that alleged Travers’ comment “put minority students at risk and in a state of panic” while also breaching the student code of conduct – with Edinburgh Uni even going so far as to open a probe over Traver’s plainly horrific comment obviously directed toward terrorists! Plainly, Travers should have known better than to dare to criticize any aspect of Islam – seeing as how, in June, a man was jailed for anti-Islam posts on Facebook and 36 people accused of hateful social media posts had their homes raided! 

Sadly, Robbie Travers is another notch in the rope of political correctness gone wrong across the pond…

Undeniably, a precedent has already been set. After scores of young girls were slaughtered at an Ariana Grande concert, the only outrage to be found was directed toward “racist” tweets. Female genital mutilation – an abhorrent practice under Islam – skated under the radar in Michigan for some odd years.  Muslim groups in Malaysia and Indonesia even boycotted Starbucks for their support of the LGBTQ movement!

Seemingly, the face of hardline Islam has fully revealed itself… but instead of seeing it for the true enemy of the West that it is; liberals, SJWs, and the mainstream media only see that true, radicalized face as “victimized” and “oppressed”. 

Even as far back as 2015, Muslims butted heads with the Jersey City school board over a proposal to close schools on a Muslim holiday, even though Muslims formed less than 4% of the city’s population at that time. Impassioned debate broke out over the proposal at a school board meeting, with a local Muslim mother espousing:

“We’re no longer the minority, that’s clear from tonight. We’re going to be the majority soon.”

Inciting words like that don’t help your cause or the fight against Islamophobia… An opined statement such as that implicitly broadcasts two things to anyone listening…

  • We are not assimilating, nor do we have any interest in doing so…
  •  When we are the majority, we’ll get our way – Sharia and all.

Sadly, Robbie Travers is not protected under freedom of speech in the U.K., nor is anyone else over there that’s brave enough to criticize Islam. As an American, it’s unbelievable to see the transgressions carried out over someone’s words and thoughts. Truly, the precedent has been set in England, the U.K., the EU… It will not get better, only worse. Citizens already do not have any protections regarding their speech or expression so technically, the injustice against Travers (and all the other mentioned cases in this article) aren’t even illegal!

It’s shocking that Travers – after mocking ISIS, a group we should all agree is OK to piss on and belittle – was chastised. Seemingly, when you side against the one insulting a radicalized group of terrorists attempting to destroy the West, you’re siding with the terrorists. Therefore, the stance the University of Edinburgh is taking – whilst accommodating to people offended by Travers’ comment – spits on the face of any real freedom of thought or expression.

More and more, it seems that America is becoming the last bastion of freedom – the only place on Earth where your right to speech and expression is still protected and lauded. Elsewhere, you’ll do time for sharing your opinions if they go against the mold. The U.S. constitution grants us our natural rights and because our forefathers had the wits to write them down, they can never be taken away or stomped on; lest our Constitution be degraded, which must never be allowed to happen.

The U.S. Constitution acts the bedrock for our freedoms and democracy, any subversion or change to it could lead to disasterous consequence. We have a foundation and guide to follow in regards to any enemies, domestic or foreign, facing us – and we’d be good to rely on it. Death by political correctness is 100% avoidable. However, the path the U.K. and EU are seemingly headed down has only one outcome: slaughter.

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“We’re Just Trying To Feed Our Families” – Equifax Hackers Demand $2.6 Million Ransom In Bitcoin

Two days after credit-monitoring company Equifax revealed that, because of its staggering negligence, hackers had managed to penetrate the company’s meager cybersecurity defenses and abscond with up to 143 million social security numbers and a trove of other personal data – including names, addresses, driver’s license data, birth dates and credit-card numbers – the cyberthieves responsible are threatening to sell the data to the highest bidders unless they receive a ransom payment of 600 bitcoin – worth about $2.6 million, according to CoinTelegraph.

In the ransom note, which was published on the dark web, the hackers said they were just two regular people trying to get by – and that, while they don’t want to hurt anybody, they need to monetize the information as soon as possible. They promised to delete the data as soon as the ransom was received.

"We are two people trying to solve our lives and those of our families.

 

We did not expect to get as much information as we did, nor do we want to affect any citizen.

 

But we need to monetize the information as soon as possible.”

The hackers have now made a ransom demand, stating on a Darkweb site that they will delete the data for a ransom payment of 600 BTC, worth approximately $2.6 million.

The demand said that if they do not receive the funds from Equifax by September 15th, they will publicize the data.

Meanwhile, as we reported last night, two plaintiffs have filed a $70 billion class-action lawsuit against Equifax in a Portland, Ore. federal court – a case that has the potential the crush the company with a massive payout.

In the lawsuit, lawyers from Olsen Daines PC, who filed it on behalf of plaintiffs Mary McHill and Brook Reinhard, alleged that Equifax was negligent in failing to protect consumer data, and that the company chose to save money instead of spending on technical safeguards that could have stopped the attack.

Imagine how much angrier they would be if they found that instead of "saving" the money, the company used it instead to buy back its own stock (in this case from selling executives)?
the two plaintiffs in the case filed in Portland, Ore., federal court has every single merit to ultimately crush Equifax for what is nothing less than unprecedented carelessness in handling precious information.

Of course, in what will likely be remembered as a massively stupid public relations blunder, Equifax “neglected” to specify that an arbitration waiver included in an online portal allowing customers to check on the status of their information “does not apply to this cybersecurity incident.”

…We wonder, which incident does it apply to then?

Here’s the company's full statement from the company, courtesy of the Washington Post:

Equifax issued a statement Friday evening. “In response to consumer inquiries, we have made it clear that the arbitration clause and class action waiver included in the Equifax and TrustedID Premier terms of use does not apply to this cybersecurity incident,” the company said.

Meanwhile, one reporter who was examining the company’s web portal pointed out what is either a hilarious glitch, or an ominous indication that the most troubling reveal is yet to come
 

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“The Guy is Hiding Something”: Top Hillary Aide Suggests Bernie Colluded With Russia Too

Authored by Joshua Caplan via TheGatewayPundit.com,

The length to which Hillary Clinton and her team will go to shift blame onto others for President Trump’s victory last November is stunning.

Adam Parkhomenko, a long time aide to Hillary Clinton, took to Twitter Friday evening to rant about how great his boss’s presidential campaign was in 2016, while taking shots at her primary opponent Bernie Sanders.

In the middle of Parkomenko’s thread, the Clinton aide insinuates something quite explosive – Bernie Sanders may have colluded with Russia in the Democratic primary.

“PS…you seem to ignore the Russia support online for Bernie during the primaries. The guy is hiding something. Not sure I want to know what,” the aide tweeted.

Below is the tweet (and screenshot) where the insinuation was made.

 

Who is Adam Parkomenko? He’s one of the two campaign aides Hillary Clinton hired for her “Resistance” super PAC and worked as a state political director for Clinton as far back as 2008.

Buzzfeed reports:

Hillary Clinton has hired two political operatives from her 2016 presidential campaign to help manage Onward Together, the project she founded this spring with former governor Howard Dean to fund and support a coalition of Democratic groups led by activists and organizers.

 

The new additions, Emmy Ruiz and Adam Parkhomenko, held central roles on Clinton’s campaign: Ruiz delivered key victories as state director in Nevada during the primary and in Colorado during the general election; Parkhomenko worked in headquarters as her director of grassroots engagement before moving to the Democratic National Committee. Both served on Clinton’s first presidential bid in 2008.

 

Dean, the Onward Together co-founder, confirmed the recent hires on Friday. The two former campaign aides will be working on Onward Together as consultants.

 

Clinton’s new group, registered in May as a 501c4 organization with an affiliated super PAC, is working to establish a small but diverse cooperative of about 10 to 12 grassroots efforts, each one focused on a different area of the energy and activism set off by Donald Trump’s election and presidency. Dean said they are still in the process vetting groups to add to the coalition, which already includes organizations such as Swing Left, Emerge America, and Run For Something.

Failed Democratic presidential candidate and Vermont Senator Bernie Sanders recently fired back at Hillary Clinton’s comments regarding Sanders in her upcoming book detailing her election loss.

Sanders speculated whether anyone actually believed any of her ridiculous stories. While on “All In with Chris Hayes” on MSNBC, Sen. Sanders responded to an excerpt from Clinton’s book wherein her policy adviser Jake Sullivan called Sanders’ policy ideas reminiscent of a scene from “Something About Mary” wherein a hitchhiker comes up with a plan to make 7-minute abs to top 8-minute abs:

“I.e., Bernie Sanders just stole all of Hillary Clinton’s ideas. Does anybody really believe that? The truth is, and the real story is, that the ideas that we brought forth during that campaign, which was so crazy and so radical, have increasingly become mainstream.”

Sanders went on to cite his ludicrous proposal of a $15 minimum wage, $1 trillion infrastructure overhaul program, his bogus “tuition free college” (meaning – free at the expense of taxpayers) and “Medicare for all.”

The excerpt via the Hill reads:

“That’s what it was like in policy debates with Bernie. We would promise a bold infrastructure investment plan or an ambitious new apprenticeship program for young people, and then Bernie would announce basically the same thing, but bigger. On issue after issue, it was like he kept promising four-minute abs, or even no-minutes abs. Magic abs!”

Watch the video below:

Excerpts from Hillary’s  book have been released and she reportedly takes a few swipes at primary opponent Bernie Sanders.

CNN contributor Brianna Keilar responded to Hillary’s swipes:

It speaks to an issue that Hillary Clinton has had. I think we’ve all seen this where she struggles sometimes to take responsibility

 

But she came in with weaknesses that were completely self-created and for an opponent to ignore those things, to not really run the emails, and those things, to not really capitalize on them would have been political negligence.

And this was after Bernie endorsed Hillary and campaigned with her after she stole the primary from him!

Wow.

 

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Curfews Issued Across Southern Florida Cities: “Deputies Will Not Be Responding”

Local governments are now issuing curfews across South Florida.

Broward County has issued a curfew starting at 4:00 pm and remains in effect until further notice.

 

A mandatory curfew will also be in place tonight in Coral Springs from 8:00 p.m. – 6:00 a.m.

 

The City of Fort Lauderdale will enforce a Countywide curfew beginning at 4 p.m.

 

A barrier island curfew will be in effect for the City of Deerfield Beach and the Town of Hillsboro Beach at noon. A Citywide curfew for Deerfield Beach will also begin at noon.

 

The City of Miami Beach issues curfew starting at 8:00 p.m. Saturday – 7:00 a.m. Sunday.

 

A mandatory 3pm curfew will be in place in Palm Beach County  until further notice

As CBS reports, Broward County Mayor Barbara Sharief said, “When winds reach 45 mph, deputies will not be responding.”

Effects of the storm will get stronger throughout the day. “By 2 p.m., residents will start feeling tropical storm force winds,” she said.

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For The First Time Since January 2016, The Market Volatility Regime Finally Snapped

  • August 17 marked the first time since January 16 when global equity, rates, commodity and FX vols all moved in the same direction. 
  • At the same time, short-dated cross asset correlation continued to rise reaching a level of 50%, its highest level in over 1y.

For months on end, traders, analysts and pundits have been pointing to record low implied vol as a sign of pervasive complacency (and in some cases, “trader paralysis“) in response to a market that made no sense, and where the only permitted direction was “up.” That may finally be ending, and not just based on references to seasonal patterns that have zero relevance in a “new normal” driven by central bank asset purchases, but because the market’s artificial sense of calm is finally starting to crack, as observed by the recent surge in 20-day S&P realized vol.

And when realized vol starts rising, implied vol promptly follows, and when implied vol rises, it creates a feedback loops in which vol sellers are forced to cover, raising realized vol even more, pushing implied vol higher, and so on, as the current cycle of unprecedented volatility selling eventually ends, with either a bang or a whimper (spoiler alert: the former).

Meanwhile, as both volatility metrics rise, cross-asset volatility – traditionally an indicator of latent market stress – follows. And in what may come as a surprise to some, while most have been lamenting the blanket of broad market complacency in the past year, which in recent months have been validated by near record low global cross-asset implied volatilities….

… Bank of America points out that short-dated cross asset correlation has been rising over the past few months and currently stands at 50%, its highest level in over a year. Meanwhile, the correlation of cross asset vols may have also reached a turning point: August has been the first month in over a year to witness a simultaneous rise in global equity, rates, commodity and FX volatility. In fact, August 2017 marked the first month since January 2016 in which all cross asset risk measures rose modestly over the month, even if they still remain in significantly benign territory.

To BofA’s derivatives strategist Benjamin Bowler, this suggests that various pockets of the market are finally beginning to agree on the presence of risk, albeit to varying extents.

More ominously, on a consolidated basis as noted above, in August short-dated (3-month) cross asset correlation continued to rise reaching a level of 50%, its highest level in over a year. Historically there have been 3 distinct cross asset correlation regimes since 1995.

Interestingly, the broad upward trend started in Oct-03, well before the Lehman bankruptcy in Sep-08. This is related to the liquidity driven crush in asset risk-premia that helped drive investment leverage higher. Long-term correlation established a new regime starting some time in 3Q13, similar to the ’03 to ‘08 correlation environment. With the recent surge in cross-asset vol, that regime may now be ending too.

The good news, as BofA also points out, is that the uptick in volatility and credit spreads in most cases was modest in magnitude, leaving global cross asset risk metrics well within benign territory amid a backdrop of rising geopolitical tensions on the Korean peninsula. This means that it is still historically cheap to purchase efficient hedges ahead of what is already proving to be a catalyst-rich fall.

As a final observation, BofA then lays out the cheapest derivatives across the entire global derivatives universe, in other words, those which have the highest upside in case of a crash.

The chart below shows crash returns of different assets during historical tail events per unit of current OTM option implied volatility. Ranked by the average, the screen shows that the hedges which are most underpricing historical drawdowns are: US & EU IG credit payers, Gold calls and RDXUSD (Russian equity) puts: US & European IG credit payers still rank as the best value hedges across all assets in our universe followed by Gold (and Gold ETF) calls. In equities, RDXUSD (Russia), NIFTY (India) and TWSE (Taiwan) puts screen as top hedges while puts on NASDAQ (US Tech), Top40 (S. Africa) and ASX200 (Australia) rank as the most expensive.

Finally, those who want to hedge against a crash may want to avoid buying USDJPY puts: USDJPY puts once again are at the very bottom of BofA’s screen (most expensive tail hedge) as the ongoing geopolitical risk flare on the Korean peninsula has likely increased demand for JPY as a risk-off asset. In contrast, Nikkei puts, while belonging to the same region, currently rank as the cheapest DM equity hedge.

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“Leading Indicator Of Potential Weakness” Looms In Corporate Credit Markets

While credit spreads are broadly-speaking unmoved by recent chaos, signals are emerging that investors are starting to get worried about the $7.2 trillion U.S. investment-grade bond market.

Bloomberg's Lisa Abramowicz points out that bond buyers are starting to show some signs of unease, with traders are increasingly turning to derivatives to hedge against potential losses.

This is a marked shift from earlier in the year, when many bond investors seemed unwilling to give up any returns for such protection.

During most of 2017, trading volumes in credit-default swaps sagged well below recent years' averages (the red oval below)

Now, however, Abramowicz notes that activity in the derivatives has risen sharply (green oval above), with volumes surging more than 110 percent in the week ended Aug. 11 compared with the same week in 2016.

That contrasts with a more than 10 percent decline in volumes on average throughout 2017 compared with the period last year.

"This is often a leading indicator of potential weakness," Peter Tchir, head of macro strategy at Brean Capital LLC, said on Bloomberg Radio on Tuesday.

Investors don't want to sell their corporate-bond holdings because they know it could be difficult to buy them back in the future. But they are are feeling less secure owning the debt, especially at such high valuations. So they're either getting exposure to the securities in a way that's easy to exit quickly in a pinch, or they're paying a premium to cover any losses incurred during a selloff.

"There are events on the horizon that could cause a dislocation," said Anindya Basu, a credit derivatives strategist at Citigroup Inc. "You're seeing that feed through to the market."

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Some Journalists are Just Arsonists Pointing Fingers

Via The Daily Bell

Setting a fire is easier than putting one out.

And sometimes the people who fail to put out a fire are persecuted by the ones who don’t show up at all–or worse yet, fan the flames.

A recent Gizmodo article basically criticizes a volunteer fire department. No, not literally. This has nothing to do with actual fires of fire-fighters.

This has to do with an article called, “Some Crypto-Capitalists Just Want to See The World Burn.

Conspicuously lacking in the article is… how exactly the “crypto-capitalists” want to see the world burn?

The article tears apart all the ways the attendees of the Startup Societies Summit are trying to put out the fires of the world. It tries to torch innovative ideas about how to end poverty, clean up the environment, stop government abuse, feed the hungry, and advance modern medicine.

The author of the Gizmodo piece, Bryan Menegus, is like an arsonist saying, “awfully suspicious that every time there’s a fire, all these firefighters are on the scene…”

If Menegus had a superpower, it would be the uncanny ability to find nefarious motivations for even the most innocuous solutions to serious problems.

Summoning his powers, he first cherry picks two sentences from a 15-minute presentation on how to solve the refugee crisis using Special Economic Zones (SEZs).

Among the most extreme examples of expanding SEZs was Michael Castle Miller’s presentation on “refugee cities”—a proposal to turn refugee camps into their own Shenzhens. “We can actually convert refugees into economic assets that drive us towards the economic and social progress we want to achieve,” he says. Through one lens it gives those stuck in political limbo a semblance of normalcy; through another it sees immigration as a problem in need of solving and turns refugee camps into company towns running off the labor of the displaced. “It’s an investment opportunity because now all of a sudden there’s a huge labor force out there of untapped skills that nobody else can access.”

Maybe in the utopia in Menegus’ mind, immigration is not a problem in need of solving. But in the real world, millions sit in camps not allowed to work for their own economic benefit.

Apparently, governments setting up camps and then funding them without end fits into the Savior Complex of Gizmodo and associates. Instead of freeing and empowering individuals, they think of people as weak, in need of constant nurturing by mother government. Yet these refugees are being smothered by their matriarchal providers. Governments don’t let them work and refuse to let them integrate into economies surrounding the encampments.

You might think allowing someone the opportunity to work and provide for themselves and their families would be a good thing. All Menegus sees is exploitation. Somehow, he casts company towns as worse than the literal prisons in which refugees now live.

When he wants to criticize, Menegus has no difficulty conjuring up images of a burning world, ripe for greedy capitalists to take advantage of desperate victims in need.

Yet all these troubles evaporate when he questions the suspicious actions of the event’s speakers.

When asked what he’s running from that requires a man-made island on the ocean, Joe Quirk says “pretty much all the governments that exist.”

Menegus had countless examples of how the naive attendees, refugees, the poor, and others would be taken advantage of by greedy capitalists. But suddenly the scary world in need of government protection disappears. What’s so bad that you need to run?

I don’t feel like rehashing the genocides, wars, exploitation, nor the racial, gender, and religious discrimination perpetrated by various governments. From Jim Crow laws to Ruby Ridge, from the Tuskegee experiments to torture at Gitmo, there is plenty to run from in reference to the U.S. government alone.

But also, why ignore the failures? The failure of the government to end poverty, the failure to solve crime, the failure to restore the environment, heal the sick, and so much more?

As much as Quirk runs from the psychopaths in government, he tackles the problems they have never been able–or willing–to solve. I suppose Menegus would just have us wait for our saviors to get around to rescuing us poor helpless souls.

But the people involved in Startup Societies prefer to take matters into their own hands.

Let’s Talk About Failure

Don’t all the people at this conference know how many times these ideas have failed, the article suggests.

If only we could all be like Edison, The Wright Brothers, and Einstein, who all got the lightbulb, the airplane, and the theory of relativity right on their first try.

Of course, failure alone does not mean you will eventually succeed. But Menegus has to ignore the mountains of evidence in order to pretend the projects discussed have no future.

And ignore the data, or twist it, is exactly what he does.

The hope, for those like Strong, is that these experiments will not only alleviate global poverty, but show otherwise oppressive nations a better way forward—a concrete oasis that paves a path to more liberalized future governance—but it’s unclear if that’s been the case in any of the dozens of countries currently hosting an SEZ. If wages and conditions improve in one zone, what prevents corporations from packing up and finding a new crop of foreign bodies to run the machines?

It’s only unclear if you haven’t bothered to look into it.

Read another way, here is what Menegus is actually asking:

A special economic zone could improve the lives of workers and residents so much that companies no longer have cheap labor in the SEZ. Now that their former workers have the economic freedom to choose other options, what’s to stop a company from finding new crops of foreign bodies to lift out of poverty with the same methods?

Imagine the horror! What if these companies just bop around the world creating wealth, and empowering individuals until there is no one left to exploit!? Then who will Gizmodo and Bryan Menegus save with their snarky articles and sassy critique?

Relevant comparisons are ripe for analysis.

Why do South Koreans live in a normal wealthy nation, while North Koreans have not advanced since the two countries split? Before the Korean War, the populations were equally matched economically.

What’s the difference between China and Hong Kong that makes Hong Kong one of the wealthiest places on Earth? What about Singapore’s rapid development after their independence in the 1960’s?

Joe Quirk’s book Seasteading: How Floating Nations Will Restore the Environment, Enrich the Poor, Cure the Sick, and Liberate Humanity from Politicians, highlights how experimenting with government could lift people out of poverty, solve overcrowding in cities, feed the masses while reducing the environmental impact of farming.

And yet he is likened to snake-oil salesmen. Menegus doesn’t miss the opportunity to take a shot at Quirk’s hair–which I think is lovely–and “frat boy” attitude.

Ironically, some of these experiments that Menegus is so quick to torch as libertarian fantasies, are not very libertarian at all.

Sure, economically speaking Singapore is very free. But Joe Quirk points out in his book that it also has universal health care and an annual government budget surplus. On the other hand Singapore has no minimum wage and 2% unemployment.

Hong Kong requires no licenses for any business. They also boast “no sales tax, no capital gains tax, no goods and services tax, no value added tax, no annual net worth tax, no inheritance tax, and no estate tax.”

Yet 50% of the residents of Hong Kong live in a form of subsidized housing and every resident receives free emergency medical care. The top 8% of Hong Kong residents shoulder 60% of the tax burden, and the bottom 60% of residents pay no income taxes.

So why is Menegus so quick to rule out these projects, when some of them resemble the progressive dream?

Quirk’s point is not that progressives are wrong and libertarians are right. He says “While the West argued, the East experimented.” There simply have not been enough modern experiments in government to yield any concrete data. We need more experiments. 

No Thanks, I’ll Take My Business Elsewhere

Menegus dismisses one of the clearest signs that the “exitarian” strategy is viable.

Peter Thiel helped found the Seasteading Institute. Among other things, they promote the idea of islands or ships hosting medical tourism offshores from restrictive or expensive countries.

Offshore medical research is something Thiel is already engaged in, and which has been described as “patently unethical.”

What the Menegus refers to is the testing of a herpes vaccine. You know, the thus far incurable virus.

Instead of being thwarted by the costs and bureaucracy of the FDA, or waiting 20 years and hoping the “valley of death” doesn’t scare off investors, Thiel took action.

So some shmucks connected to the U.S. government call it unethical. Big surprise.

Volunteers with herpes are getting a chance to be cured, without having to wait 20 years for the FDA to–maybe–approve it. What’s so unethical about skirting an agency known to be corrupt, which derives a big chunk of its revenue from being paid off by pharmaceutical companies?

In truth, Menegus’ Gizmodo article reads like a Newsweek article from 1995 triumphantly declaring the internet would never catch on.

This is, of course, laughable now. In a few years, it will be laughable to think we should have continued another 1,000 years of government identical to the last 1,000 years of government.

Startup Societies are primed to revolutionize the way government works. Singapore, Hong Kong, countless special economic zones, and even innovative cruise lines stand as clear signs of times to come for anyone paying attention.

In 1995, the internet was sometimes more hassle than it was worth. It didn’t do any of its functions particularly well. There was still a lot of experimentation needed to flesh out the proper applications.

Twenty-two years later, it is hard to imagine the world without it.

Everyone has an Agenda

I don’t want to be misleading here. The event organizer, Joe McKinney, who Menegus trashes in the opening of his article, is a friend of mine. I don’t like to see my friends maligned, especially when they are working their asses off to seriously improve the world. And yes, that is going to make me somewhat biased.

But the idea that Menegus is a neutral journalist is laughable. He, and Gizmodo, have an agenda.

They promote the idea of helplessness. They sell a victim mentality. If someone’s making money, someone else must be getting screwed. If someone aligns with a particular political agenda, then everything else they say should be ignored.

Of course, their political beliefs are altruistic and legitimate. They are just trying to fight Nazi’s and help the poor. But when Joe Quirk talks about how to help the poor, he’s just a used car salesman trying to make a buck.

Menegus assumes the worst of any business and assumes government has the best intentions. But people are people. Some are motivated by greed, and others by altruism, regardless of whether they join the government or the private sector.

But you can disengage from businesses. Menegus didn’t have to be at the Summit, and he doesn’t have to join any Startup Society. No one does.

Yet all 7.5 billion people on Earth must choose between 195 countries. And in reality, most of them can’t choose to leave or enter any particular country at will.

All the Startup Society Foundation is saying is that we should have more options. Let’s get more experiments going, and we can see what type of government works the best.

Menegus can start or join one with a universal basic income and censorship if he wants.

The people at the Startup Society Summit are looking for peaceful solutions. Yes, some of them want to exit, and no longer consort with the type of people who read Gizmodo. How crazy to want to disengage from people who say things like:

These people are so entrenched in a helpless victim mindset, they can’t think of any way to solve simple problems of security without government. But they do highlight the biggest threat which faces Startup Societies: violent governments enabled by angry, hateful voters.

Why exactly do these people want to see everyone with differing views murdered by terrorists and governments?

Other commenters were quick to point out the similarities of Startup Societies to the video game Bioshock. The attendees of the event preferred history and science to inform their comparisons.

But the best comment has got to be this one:

I feel that we would get a lot more realistic and useful tech and vision from these people if we shipped them to a government-free island for a few years. Then when they come back they should have at least a basic understanding of what the government is here for, for better or worse, and how to get what they need they will need to work within the current system because it’s not possible to just exclude themselves and create another – they are wholly dependent on it.

This comment reveals the clear misunderstanding between the Startup Societies project and the uninformed critics.

First, the people involved in Startup Societies are attempting to put themselves on “islands” without traditional government. They are begging to not be attacked by governments for simply trying out their own forms of governance. If the critics aren’t afraid of the results, why are they so violently opposed to the experiment?

Second, the Startup Societies may be critical of typical government, but they aren’t opposed to any governing structure whatsoever. Every project proposes mechanisms for how to govern the territory. It is just that the methods of rule-setting don’t involve coercion, theft, and violence.

The truth is they would never come back from the island. But plenty of people would be begging to come join–just like in Singapore and Hong Kong.

This won’t be the last hit piece on Startup Societies as the ideas catch on. But who cares? The whole point is to disengage from people who want to control us, who thinly veil their violent aggression with altruistic excuses a Savior Complex.

via http://ift.tt/2vVKaz7 TDB

Hackers Can Now Cause Blackouts On America’s Electrical Grid, Report

Authored by Rick Moran via AmericanThinker.com,

It was inevitable that someday, hackers would have the ability to exert control over the U.S. electrical grid.  According to the computer security firm Symantec, someday is today.

Hacking attacks over the last several months that targeted U.S. energy companies have been able to gain "operational control" over systems, thus threatening blackouts across the U.S., says Symantec.

 The hacker group known as DragonFly 2.0 was able to gain control in at least 20 places, according to the firm.

Wired:

Symantec on Wednesday revealed a new campaign of attacks by a group it is calling Dragonfly 2.0, which it says targeted dozens of energy companies in the spring and summer of this year. In more than 20 cases, Symantec says the hackers successfully gained access to the target companies' networks. And at a handful of US power firms and at least one company in Turkey – none of which Symantec will name – their forensic analysis found that the hackers obtained what they call operational access: control of the interfaces power company engineers use to send actual commands to equipment like circuit breakers, giving them the ability to stop the flow of electricity into US homes and businesses.

 

"There's a difference between being a step away from conducting sabotage and actually being in a position to conduct sabotage … being able to flip the switch on power generation," says Eric Chien, a Symantec security analyst. "We're now talking about on-the-ground technical evidence this could happen in the US, and there's nothing left standing in the way except the motivation of some actor out in the world."

 

Never before have hackers been shown to have that level of control of American power company systems, Chien notes. The only comparable situations, he says, have been the repeated hacker attacks on the Ukrainian grid that twice caused power outages in the country in late 2015 and 2016, the first known hacker-induced blackouts.

 

Security firms like FireEye and Dragos have pinned those Ukrainian attacks on a hacker group known as Sandworm, believed to be based in Russia. But Symantec stopped short of blaming the more recent attacks on any country or even trying to explain the hackers' motives. Chien says the company has found no connections between Sandworm and the intrusions it has tracked. Nor has it directly connected the Dragonfly 2.0 campaign to the string of hacker intrusions at US power companies – including a Kansas nuclear facility – known as Palmetto Fusion, which unnamed officials revealed in July and later tied to Russia.

 

Chien does note, however, that the timing and public descriptions of the Palmetto Fusion hacking campaigns match up with its Dragonfly findings. "It's highly unlikely this is just coincidental," Chien says. But he adds that while the Palmetto Fusion intrusions included a breach of a nuclear power plant, the most serious DragonFly intrusions Symantec tracked penetrated only non-nuclear energy companies, which have less strict separations of their internet-connected IT networks and operational controls.

The first question I would want answered is, if they have that sort of control, why not exercise it?  Why no blackouts or service interruptions in the U.S.?

Hacking Sony or another private business is one thing.  Fooling with our electrical infrastructure is many orders of magnitude more serious.  If a sovereign nation were behind such an event, it would be tantamount to a declaration of war.  Unless the attacking nation was supremely confident that the hack couldn't be traced back to it, the nation would be unlikely to attempt it.

Causing a blackout in a major urban area would almost certainly result in many deaths.  We know this from previous blackouts in New York City, where the 2003 power outage is estimated to have resulted in 100 deaths.  This would be intolerable, and if the attack could be traced back to Russia or China, it would result in retaliation by the U.S.  We're no slouches ourselves when it comes to cyber-warfare, and we could almost certainly make any country pay dearly.

But in a time of war, that kind of control over our electrical grid could wreak havoc and sow confusion and fear among the populace.  In the meantime, it would behoove the government to work with industry to harden our systems to prevent that kind of catastrophe.

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