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Nine months ago, things weren’t look good for Syria’s Bashar al-Assad.

Four years into his country’s bloody civil war, he found himself fighting a multi-front war against a long list of largely Sunni extremist elements and the government’s forces were stretched thin. The rebels enjoyed the support not only of the US, but of Saudi Arabia, Qatar, and Turkey. That meant that their resources were essentially unlimited.

It had taken longer than expected, but by summer of last year, the plan that was revealed in a leaked diplomatic cable from 2006 penned by Deputy Chief of Mission in Syria William Roebuck had materialized. The West and its regional allies had managed to engineer a Sunni uprising against the Alawite government by fomenting sectarian discord and within months, Assad would either flee (likely to Russia) or end up like Gaddafi – executed by an angry mob.

Russia’s intervention changed all that by giving Hezbollah an advanced air force to back ground offensives and now, four months since Russia first begun flying combat missions from Latakia, Assad is poised to recapture Aleppo, securing his grip on the country’s main urban centers.

Assad has given several interviews since the end of last summer. We’ve documented most of them here. In September for instance, he had the following advice for the West, which suddenly became acutely aware of the “problem” in Syria when the indelible image of three-year-old Aylan Kurdi drowned on a Turkish beach was plastered all over the nightly news: “If you are worried about them, stop supporting terrorists. That’s what we think regarding the crisis. This is the core of the whole issue of refugees.”

Then, in the wake of the Paris attacks, Assad condemned the assaults as “savage” but reminded the media that “what France suffered from terror is what the Syrian people have been enduring for over five years.” “We said, don’t take what is happening in Syria lightly. Unfortunately, European officials did not listen,” he added.

Then, in December, Assad invited Die Presse to Damascus for a sweeping interview in which the President described the country’s infrastructure as “pretty much destroyed” and blamed Turkey, Saudi Arabia, and Qatar for turning Syria into a “hotbed for terrorists.”

Now, with Iran and Russia set to rout the rebels at Aleppo, Assad sat down with AFP and said from Damascus that pro-government forces would “without any hesitation” look to retake the entire country from the rebels. Below, find excerpts from the interview in which Assad also touches on the possibility of a Saudi or Turkish ground invasion, and on Europe’s culpability in vis-a-vis the conflict.

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Highlights from AFP and al-Arabiya

Speaking Thursday in Damascus, Assad said his armed forces would try to retake all of Syria “without any hesitation,” but that the involvement of regional players “means that the solution will take a long time and will incur a heavy price.”

“The main battle is about cutting the road between Aleppo and Turkey, for Turkey is the main conduit of supplies for the terrorists,” he said in an interview conducted Thursday in Damascus.

He warned that the French government should change its “destructive policies” in support of extremists.

France has implemented “destructive policies extending direct support to terrorism… It is France’s duty to reverse or change its policies,” Assad said.

“We have fully believed in negotiations… however, if we negotiate, it does not mean that we stop fighting terrorism. The two tracks are inevitable in Syria,” he said.

But he said he sees a risk that Saudi Arabia or Turkey could launch a military intervention in his country.

He said he “doesn’t rule out” such an intervention, but said that his armed forces “will certainly confront it.”

On the issue of the refugee crisis he said Europe was a “direct cause” of Syrians fleeing their homeland and must stop “giving cover to terrorists” before people return.

He called on European governments “which have been a direct cause for the emigration of these people… to help in making Syrians return to their country.”

“I would like to ask every person who left Syria to come back,” he said.

“They would ask ‘why should I come back? Has terrorism stopped?‘”

Full transcript

Question 1: How do you feel when you see tens of thousands of your citizens starving, running away from hunger, from their areas which are being shelled by your Russian allies, and trying to cross the borders to Turkey? And how do you feel when you see the pictures of them drowning in their attempt to cross the seas?

President Assad: If we talk about emotions, I belong to this people; and it is self-evident that I have the same feelings my people have. Any scene of suffering is painful to all of us as Syrians. But as an official, the question for me is less about emotions than about what I, as an official, should do, being responsible before my people.

However, when the cause of this suffering is the terrorists, not the Russian shelling as claimed by Western media, and when one cause for migration is the almost five-year-old embargo against the Syrian people, naturally my, and every Syrian official’s first task is to fight terrorism essentially using Syrian capabilities, but also using our friends’ support in the fight against terrorism. That’s why I say the problem of Syrian refugees abroad, as well as the problem of hunger inside Syria, as you referred to it, is a problem caused by terrorism, Western policies, and the embargo imposed on the Syrian people.

Question 2: Mr. President, can we talk about the possibility of putting an end to shelling civilian populations and also lifting the blockade imposed on certain areas?

President Assad: The conflict has been, since the beginning of the crisis in Syria, about who wins the support of the people in Syria. Consequently, it doesn’t make sense for us to shell civilians if we want to win them to our side. This is in theory. Practically, while moving around in Syria, you will find that in any area under the control of the state, all sections of Syrian society, including the families of the militants, are being cared for by the state. What is more is that in a city like Raqa, which is under the full control of Daesh (ISIS), the state continues to pay the salaries of employees and send vaccines for children. So it doesn’t make sense for the state to shell civilians while doing all the above, unless we are talking about mistakes which happen in every battle. The general rule is that there are innocent victims in every war. This is a rule of thumb in wars, but this is definitely not the Syrian state’s policy.

Question 3: Mr. President, what do you say to those emigrating to Europe? Do you ask them to come back?

President Assad: I would like to ask every person who left Syria to come back. That’s natural but not enough. Emotions are not enough. They would ask: “Why should I come back? Has terrorism stopped? Have the basic requirements for life been restored?” Many of those who have emigrated are neither against the Syrian state or with the terrorists, but sometimes there are circumstances which force people to emigrate. So, my answer to this question is: when terrorism recedes, and things are better, they will return of their own volition without any invitation. So, instead of asking these people to return, I’ll call on the European governments, which have been a direct cause for the emigration of these people, by giving cover to terrorists in the beginning, and through the sanctions imposed on Syria, to help in making the Syrians return to their country.

Question 4: Mr. President, will the Syrian state regain control over Aleppo in the next few days? If so, what is next?

President Assad: The battle in Aleppo now is not about regaining control over Aleppo, because the Syrian state is there; but the main battle is about cutting the road between Aleppo and Turkey; for Turkey is the main conduit of supplies for the terrorists. The battle is going on now on more than ten fronts at the same time, from north to south, to the east, to the far east too, and to the west in Latakia. It was going on in Homs, and now it’s over. So, all these stages are moving in parallel.

Question 5: Do you think, Mr. President, that you can regain control over all Syrian territory?

President Assad: Regardless of whether we can do that or not, this is a goal we are seeking to achieve without any hesitation. It makes no sense for us to say that we will give up any part. The timeframe is dependent on two scenarios. Suppose that the problem is purely Syrian, i.e. that Syria is isolated from its surroundings, we can put an end to this problem in less than a year by moving on two fronts: fighting terrorism and political action. The second scenario — which is the case now — taking the shape of continuing supplies to terrorists through Turkey, Jordan, and partly from Iraq ? because Daesh (ISIS)exists in Iraq with Saudi, Turkish, and Qatari support -? naturally means that the solution will take a long time and will incur a heavy price. So it is difficult to give a precise answer about the timeframe.

Question 6: Can’t you say precisely how many years you need to restore peace to Syria?

President Assad: The question is: for how many years will Turkey and Saudi Arabia continue to support terrorism? That is the question. And when will the West put pressure on these countries to stop supporting terrorism?

Question 7: Who is your main enemy? Is it the so-called moderate opposition and the Islamists, or is it Daesh (ISIS)?

President Assad: I don’t think that the term “opposition” can be used, in France or anywhere else in the world, to describe somebody carrying a weapon. Opposition is a political act. Suppose that you mean to say “moderate terrorists”, this is a different term. Saying that, you mean that they do not belong to Daesh (ISIS), Al-Nusra, or to these extremist groups. Obama said that the moderate opposition is a fantasy. Biden said the same thing. But what’s more important is reality which says that such an opposition is non-existent. Most of the militants belong to extremist groups, such as Daesh (ISIS), Al-Nusra, Ahrar al-Sham, and others. So, my answer is that every terrorist is an enemy. We respect every political opposition; and we do have political opposition inside Syria. They adopt tough positions against the state, and we are not attacking them.

Question 8: You see no difference between these armed groups and Daesh (ISIS), Al-Nusra, and others?

President Assad: Legally speaking, there is no difference. The state will confront all those who carry weapons. It will not ask them about their ideology. But the difference is that the extremist groups refuse to have any dialogue with the state. They believe that they will fight, die, and go to heaven. This is their doctrine. The other groups are not ideological. Most of them have been misled. They got involved in dialogue with the state later. Some of them have laid down their weapons, and some are actually fighting with the Syrian Army today. We grant them amnesty in return for laying down their weapons.

Question 9: Mr. President, what do you think of Jaish al-Islam and Ahrar al-Sham? They did negotiate with you, and went to Geneva.

President Assad: They went as part of the opposition formed by Saudi Arabia, because it is Saudi Arabia which supports terrorism worldwide. So it is only natural for the representatives of Saudi Arabia to be terrorists, not politicians.

Question 10: So you will not negotiate with those?

President Assad: In principle, direct negotiations were not supposed to take place in Geneva 3. They were supposed to take place through de Mistura. And here we should be precise: we are not negotiating with Syrians, but with representatives of Saudi Arabia, France, the UK, and others. So, if you mean Syrian-Syrian dialogue, the answer is naturally no. Dialogue with these people is not a Syrian-Syrian dialogue at all. A Syrian dialogue is that conducted with Syrian groups which have grassroots in Syria, like the political opposition in Syria, for instance. Any persons calling themselves opposition but belong to foreign states or foreign intelligence services do not represent Syrians in the dialogue, and simply we do not consider them Syrian.

Question 11: All those who went to Geneva were based outside Syria. Can you explain?

President Assad: No, some of them are based inside Syria, and some live outside Syria but they are involved in politics and have supporters in Syria. I’m not talking only about terrorists, I’m talking about people who have been formed in a foreign state and act on behalf of a foreign state.

Question 12: Don’t you think that had you been more tolerant in dealing with this opposition in the past, you would have avoided this conflict? Don’t you bear part of the responsibility?

President Assad: We do not claim that we did not make mistakes in Syria. This is natural in any state. And we do not claim that we, in the Middle East, have reached a stage of significant political openness. We were moving in that direction, not very quickly, and maybe slowly. Back to your question, the more radical segments of the opposition inside Syria, which attack the state, have not been imprisoned or prosecuted by the state, neither before or after the crisis. So, I don’t know what is meant by tolerance in this case.

Question 13: Maybe it was difficult for the opposition inside Syria before. Maybe they did not have a margin for movement?

President Assad: You are talking about a general condition in the Middle East. This is partly true, particularly in the Arab world. But the question in this case is not that of tolerance. The question has to do with individuals rather than institutions. The question is: what is the institutional action that we should take in order to move forward. This has legal, social, or cultural aspects, because democracy is more of a culture than a law. You cannot proceed with laws while remaining culturally in your place.

Question 14: Mr. President, do you think that there might be a Turkish intervention in Syria now? And do you think the Saudi threats are serious?

President Assad: Logically, intervention is not possible, but sometimes reality is at odds with logic, particularly when there are irrational people leading a certain state. That’s why I don’t rule that out for a simple reason: Erdogan is a fanatical person with Muslim Brotherhood inclinations. He is living the Ottoman dream. For him, the collapse which took place in Tunisia, Libya, Egypt and Syria is something personal. This threatens his political future, on the one hand, and his fanatical Islamist ambitions, on the other. He believes that he has an Islamist mission in our region. The same applies to Saudi Arabia. The collapse of the terrorists in Syria is a collapse of their policies. I tell you that this process is surely not going to be easy for them, and we will certainly confront it.

Question 15: Mr. President, are you prepared to give northern Syria to the Kurds for self-rule after the crisis?

President Assad: This question is directly related to the Syrian constitution; and as you know, the constitution is not given by the government, all sections of Syrian society have a say in it, and it is put to public referendum. That’s why this should be a national question, not a question put to any Syrian official, whether it has to do with self-rule, federalism, decentralisation, or any similar thing. All these things are part of the political dialogue in the future; but I would like to stress that the Kurds are a Syrian national group.

Question 16: Is it true that the Russians tried to persuade you to step down? Don’t you fear a Russian-American deal on this issue?

President Assad: If we look at Russian policies and Russian officials in the same way we look at unprincipled Western officials and policies, this is a possibility. But the fact is the exact opposite, for a simple reason: the Russians treat us with great respect. They do not treat us as a superpower dealing with a minor state, but as a sovereign state dealing with a sovereign state. That’s why this issue has not been raised at all in any shape or form.

Question 17: Mr. President, are you prepared to give Russia and Iran permanent bases on your territory? Do you fear that Syria will become a satellite to these powers?

President Assad: Having military bases for any country in Syria does not mean that Syria will become a satellite state to these countries. They do not interfere in issues related to the law, the constitution, nor to politics. In any case, the Russian base exists already, while the Iranians have not asked to have one. But in principle, we do not have a problem.

Question 18: So if the Iranians raise this possibility, will you accept?

President Assad: The issue hasn’t been raised, and consequently this is hypothetical. But as I said, when we accept it in the case of Russia, it means the principle is acceptable. But this also depends on the capabilities of every state and their role on the regional and international arena.

Question 19: Has Russia asked your permission to build new bases on your territory?

President Assad: No.

Question 20: The American elections are still at the primaries stage. Are you, personally, with candidate Trump or Clinton or is there a third person who might be in the interest of the region?

President Assad: We have never placed our bets on any American president. We always bet on policies; and these policies are not controlled only by the president, but by the establishment in general, and by the lobbies operating in the United States. If you look at the competition between many candidates, now or in the past, you will find that it revolves around who is more inclined to start wars, and this doesn’t bode well. The problem with American politicians is that they say something and do the exact opposite, before and after the elections.

Intervention: So, the promises made by Trump do not frighten you?

President Assad: No. As I said, since I don’t build on what the American candidates say, I see no reason why I should comment on any of them, i.e. they are all alike to me.

Question 21: Mr. President, do you intend to be a president for life? And if you don’t, are you in the process of grooming a successor, perhaps one of your sons?

President Assad: First, the presidency is not a hobby that we enjoy. It is a responsibility, particularly in these circumstances. As to my selecting a successor, this country is neither a farm nor a company. If I want to remain president, that should be dependent on two factors: first, my desire to be president, and second, the desire of the people. When the next elections come and I feel that the people don’t want me, I shall not stand. That’s why it’s too early to talk about this. We still have years before the next elections.

Question 22: Mr. President, you know that there have been many accusations made about your government and you personally, most recently by the UN investigation committee which accused you of genocide, which is a crime against humanity. Aren’t you concerned that you will one day face an international court?

President Assad: First, you know that UN institutions express balance among the superpowers and the conflict among them. And these organisations are now basically controlled by Western powers. That’s why most of their reports are politicised and serve a political agenda. The evidence is that these organisations haven’t said anything about clear massacres perpetrated by terrorist groups against innocent civilians in Syria. What refutes the reports of these organisations is that, first, they do not provide any evidence, and this is the case in general. Second, there is a logic for things: if Western states and rich Gulf states are against an individual, and this individual is killing his people, how would he withstand for five years in these circumstances? That’s why I’m not concerned about these threats or these allegations.

Question 23: But don’t you believe that these reports are correct? There are eyewitnesses in this case.

President Assad: No, there is a difference between individual crimes having been committed and having a state policy of systematic killing. I said that innocent people die in the war. That is true, but war crimes are committed when orders are given to follow a policy of committing massacres for certain purposes. Had this been true, people would have fled from state-controlled areas to the areas controlled by armed groups. What is happening is the exact opposite — everybody moves to the state-controlled areas.

Question 24: Mr. President, how do you think you will figure in history: as a man who saved Syria or a man who destroyed it?

President Assad: This depends on who will write the history. If it is the West, it will give me all the bad attributes. What’s important is how I think. Certainly, and self-evidently, I will seek, and that is what I’m doing now, to protect Syria, not to protect the chair I’m sitting on.

Question 25: Mr. President, do you still really intend to negotiate?

President Assad: We have fully believed in negotiations and in political action since the beginning of the crisis; however, if we negotiate, it does not mean that we stop fighting terrorism. The two tracks are inevitable in Syria: first, through negotiations, and second through fighting terrorism. And the two tracks are separate from each other.

Question 26: What is your comment on the resignation of French Foreign Minister Laurent Fabius? Do you believe that this will change French policy?

President Assad: Changing personnel is not that significant. What’s important is the change of policies. The French administration changed almost completely between Sarkozy and Hollande, but for us the policies have not changed. They have been destructive policies extending direct support to terrorism. That’s why we should not assume that the foreign minister makes the policies. They are made by the whole state, headed by the president. As to what we can do in Syria, I don’t think that Syria has to do anything towards France. It is France which should do something towards fighting terrorism. So far, it supports terrorists, albeit politically, and in some cases it supported them militarily. It is France’s duty to reverse or change its policies in order to fight terrorism, particularly after hundreds of French citizens paid with their lives for their wrong policies.

via Zero Hedge http://ift.tt/1WilGmg Tyler Durden

Americans are fat. And they’re getting fatter all the time.

It was just last month when we showed you a series of graphics that demonstrated how it came to this. In short, average calories available to Americans jumped 25 percent to 2500, between 1970 and 2010. And it wasn’t because the US added a fourth meal to the day.

It was all added fats and grains (which include oils and fats in processed foods and flour) which used to make up 37% of America’s diet, but now comprise something like 46%. The biggest contributor to the trend was cost. The increasingly more caloric foods have become progressively cheaper which means lower and middle class people are more inclined to eat them, leading directly to a worsening obesity epidemic.

As we noted back in October, America’s obesity problem has resulted in a rather shocking development researchers uncovered when they analyzed data from the National Health and Nutrition Examination Survey: “This generation of Americans is the first that will have a shorter life expectancy than the previous generation, and obesity is one of the biggest contributors to this shortened life expectancy because it is driving a lot of chronic health conditions.”

Against this rather disconcerting backdrop we present new numbers from Gallup which show that America’s obesity rate climbed to a record high of 28% in 2015. 

That’s right, America. A third of you are grossly overweight. As it turns out, whites have seen the sharpest uptick, with obesity rates climbing 2.8% since 2008. 

“In addition to the 28.0% who are obese, another 35.6% of adults are classified as overweight, with 34.6% normal weight and 1.8% underweight, as reported in 2015,” Gallup goes on to report, before noting that the incidence of diabetes has trended upwards as well. Here’s more: 

These results are based on more than 175,000 interviews conducted each year from 2013 to 2015 and more than 350,000 interviews conducted each year from 2008 to 2012 as part of the Gallup-Healthways Well-Being Index. Unlike some government estimates of obesity, the Well-Being Index uses respondents’ self-reported height and weight to calculate body mass index (BMI). It does not involve in-home clinical measurements that typically result in higher obesity estimates.

Across racial and ethnic groups, increases in obesity and diabetes rates since 2008 have been uneven. Both rates have increased much more among whites than among blacks, Asians and Hispanics. Blacks have the highest obesity rate by far of the major racial and ethnic groups, followed by Hispanics, but these two groups have had comparatively modest increases in obesity since 2008, and have shown little to no change in diabetes diagnoses during this time.

 

The obesity rate has continued to rise in the U.S. after leveling off from 2011 to 2013, and has done so despite rising public concern. Past research has demonstrated that obesity and its associated chronic conditions including diabetes cost the U.S. economy $153 billion per year in unplanned absenteeism due to poor health, a figure that has increased since the time of that study. And while blacks suffer disproportionately from chronic conditions associated with obesity, the sharp increase in obesity measured among whites since 2008 signifies that this is not a problem isolated to one racial or ethnic group.

 

Obesity affects all elements of well-being, not just physical wellness. It is associated, for example, with lower financial and social well-being. While obesity can diminish overall well-being, the relationship can also work in reverse; high well-being can reduce the chances of being obese. Those who have high or improving well-being across all five elements — purpose, social, financial, community and physical — are less likely to be obese or to become obese in the future than those who do not.

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Submitted by Mike Krieger via Liberty Blitzkrieg blog,

It is the job of the Fourth Estate to act as a check and a restraint on the others, to illumine the dark corners of Ministries, to debunk the bureaucrat, to throw often unwelcome light on the measures and motives of our rulers. ‘News’, as Hearst once remarked, ‘is something which somebody wants suppressed: all the rest is advertising’. That job is an essential one and it is bound to be unpopular; indeed, in a democracy, it may be argued that the more unpopular the newspapers are with the politicians the better they are performing their most vital task.

– Brian R. Roberts from a October 29, 1955 article in the London periodical “Time & Tide”

 

A newspaper is a device for making the ignorant more ignorant and the crazy crazier.

– H.L. Mencken

If you really want to know how weak Hillary Clinton is as a candidate, you merely have to appreciate that the U.S. media essentially acts as her own personal PR firm, yet the public still recognizes her as a dishonest crook. Brace yourself for the following story, it’s huge.

Earlier this week, we learned from Gawker that at least one U.S. reporter traded content in his article for information from Hillary Clinton’s staff while she was Secretary of State. In what is an almost hard to believe exchange, Marc Ambinder of The Atlantic,  agreed to insert specific words and imagery into his article in return for a copy of Hillary’s upcoming speech at the Council on Foreign Relations.

We have the exact exchange thanks to emails released from a 2012 Freedom of Information Act Request (FOIA). Gawker reports:

The emails in question, which were exchanged by Ambinder, then serving as The Atlantic’s politics editor, and Philippe Reines, Clinton’s notoriously combative spokesman and consigliere, turned up thanks to a Freedom of Information Act request we filed in 2012 (and which we are currently suing the State Department over). The same request previously revealed that Politico’s chief White House correspondent, Mike Allen, promised to deliver positive coverage of Chelsea Clinton, and, in a separate exchange, permitted Reines to ghost-write an item about the State Department for Politico’s Playbook newsletter. Ambinder’s emails with Reines demonstrate the same kind of transactional reporting, albeit to a much more legible degree: In them, you can see Reines “blackmailing” Ambinder into describing a Clinton speech as “muscular” in exchange for early access to the transcript. In other words, Ambinder outsourced his editorial judgment about the speech to a member of Clinton’s own staff.

 

On the morning of July 15, 2009, Ambinder sent Reines a blank email with the subject line, “Do you have a copy of HRC’s speech to share?” His question concerned a speech Clinton planned to give later that day at the Washington, D.C. office of the Council on Foreign Relations, an influential think tank. Three minutes after Ambinder’s initial email, Reines replied with three words: “on two conditions.” After Ambinder responded with “ok,” Reines sent him a list of those conditions:

 

Ambinder made good on his word. The opening paragraph of the article he wrote later that day, under the headline “Hillary Clinton’s ‘Smart Power’ Breaks Through,” precisely followed Reines’ instructions.

This is literally the first paragraph from Ambinder’s article:

When you think of President Obama’s foreign policy, think of Secretary of State Hillary Clinton. That’s the message behind a muscular speech that Clinton is set to deliver today to the Council on Foreign Relations. The staging gives a clue to its purpose: seated in front of Clinton, subordinate to Clinton, in the first row, will be three potentially rival power centers: envoys Richard Holbrooke and George Mitchell, and National Security Council senior director Dennis Ross.

If nothing else, Ambinder is very good at following instructions. Journalism, not so much.

Now back to Gawker.

Reines didn’t respond when we asked if he engaged in similar transactions with other reporters covering the State Department. But on the day of his trade with Ambinder, at least one other journalist used Reines’ preferred adjective—“muscular”—to describe the speech at the Council on Foreign Relations. That reporter was none other than Mike Allen of Politico.

 

We can’t say for sure that Reines implored Allen to describe Clinton’s speech as “muscular” and emphasize where particular audience members were seated, but that kind of request would hardly be out of the ordinary. As we noted above, Allen allowed Reines to ghost-write an item for his Playbook newsletter; and, in the course of attempting to secure an interview with Chelsea Clinton, told Reines he was prepared to submit interview questions to Clinton’s team in advance for their approval.

 

In any case, Reines’ strategy worked out nicely. For an article aggregating Allen’s piece, New York magazine quoted his use of “muscular” in the headline, and even commissioned an illustration of Clinton wearing the arms of a body builder.

Can you believe this? And you wonder why the public is so ignorant. Much of the press is not doing its job. 

Meanwhile, there’s a lot more good stuff in the Gawker article, so I suggest you read the entire thing.

Of course, this is something I’ve been saying for a while. For example, as I wrote in the recent article, A Detailed Look at The New York Times’ Embarrassing, Deceitful and Illogical Endorsement of Hillary Clinton:

The New York Times’ endorsement of Hillary Clinton against Bernie Sanders in the Democratic primary consists of an unreadable, illogical piece of fiction. In this post, I will critique the paper’s position in detail, but first I want to take a step back and explain to people what I think is going on in the bigger picture.

 

In its endorsement of Hillary, the New York Times editorial board did such a sloppy job I can’t help but think it may have done permanent damage to its brand. Upon reading it, my initial conclusion was that the editorial board was either suffering from Stockholm syndrome or merely concerned about losing advertising revenues should they endorse Sanders. Then I thought some more and I realized my initial conclusions were wrong.

 

Something else is going on here, something far more subtle, subconscious and illuminating. The New York Times is defending the establishment candidate simply because the New York Times is the establishment.

 

One of the biggest trends of the post financial crisis period has been a plunge in the American public’s perception of the country’s powerful institutions. The establishment often admits this reality with a mixture of bewilderment and erroneous conclusions, ultimately settling on the idea people are upset because “Washington can’t get anything done.” However, nothing could be further from the truth. When it comes to corruption and serving big monied interests, both Congress and the President are very, very good at getting things done. Yes it’s true Congress doesn’t get anything done on behalf of the people, but this is no accident. The government doesn’t work for the people.

 

With its dishonest and shifty endorsement of Hillary Clinton, I believe the New York Times has finally come out of the closet as an unabashed gatekeeper of the status quo. I suppose this makes sense since the paper has become the ultimate status quo journalistic publication. The sad truth is the publication has been living on borrowed time and a borrowed reputation for a long time. Long on prestige, it remains very short on substance when it comes to fighting difficult battles in the public interest. Content with its position of power and influence within the current paradigm, the paper doesn’t want to rock the boat. What the New York Times is actually telling its readers with the Hillary Clinton endorsement is that it likes things just the way they are, and will fight hard to keep them that way. It is as much a part of the American establishment as any government institution.

As I mentioned at the beginning of this post, the U.S. press basically acts like a PR firm for Hillary Clinton, yet the public still can’t stand her. That’s how bad she really is.

For related articles on the shadiness of American media, see:

A Detailed Look at The New York Times’ Embarrassing, Deceitful and Illogical Endorsement of Hillary Clinton

“Non-Official Cover” – Respected German Journalist Blows Whistle on How the CIA Controls the Media

HBO and Snapchat are Actively Working with the U.S. Government to Create Propaganda

20-Year CBS News Veteran, Sharyl Attkisson, Details Massive Censorship and Propaganda in Mainstream Media

via Zero Hedge http://ift.tt/1QcHrpb Tyler Durden

Is this what we have to look forward to?

1. Ban cash
2. All-digital currency
3. No more crime
4. -10% rates
5. 70% deposit tax
6. 20% “Bail-In” Charge
7. You’re broke
8. Unicorns

Because less (freedom) is more, right?

h/t @RudyHavenstein

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Last month, in our latest profile of the $2.8 billion Horseman Capital, we said that not only has that fund which some have called the “most bearish in the world” generated tremendous returns almost every single year since inception (except for a 25% drop in 2009 after returning 31% during the cataclysmic 2008), but more notably, it has been net short – and quite bearish on – stocks ever since 2012. In that period it has consistently generated low double-digit returns, a feat virtually none of its competitors have managed to replicate. In fact, its performance has put it in the top percentile of all hedge funds in recent years.

Furthermore, in a year most other hedge funds would love to forget, the fund “crushed it”, with a 20.45% return for 2015 and 5.6% in the tumultuous month of December. 

Today, we got Horseman’s latest numbers and they are a doozy: in what was one of the worst Januarys in stock market history, the fund returned a whopping 8%, putting it in the 99%+ percentile of returns for the month (and the year).

 

Indeed, “crushing it” is hardly new to Horseman: it has been doing so for four years in a row, and not surprisingly, 2015 was its best year since 2008. 2016 is starting off just as good as the prior year.

How did Horseman generate another month of phenomenal returns? In its own words:

This month strong gains came from the short equity book, in particular from the automobile, real estate and EM financials sectors while the long portfolio incurred a loss.

This is what Horseman’s sector allocation looks like as of this moment:

Headlines were made last year by the clampdown of the Chinese authorities on the Macau casinos, who had been allowing Chinese residents to move their winnings out of China. However, despite the clampdown and the following fall in casino revenues by some 34% in 2015 (source: Macau’s Gaming Inspection and Coordination Bureau), capital outflows have continued via other channels.

 

Imports from Hong Kong to China jumped 64% year on year in December, but the same numbers released in Hong Kong showed a 0.9% increase (sources: China and Hong Kong customs data). This could be explained by the practice of over-invoicing of Chinese imports from Hong Kong with trading partners that agree to inflate the cost of goods before a letter of credit is issued.

 

Chinese companies were involved in foreign acquisitions worth a total of $656bn last year and already this year, four of the biggest cross-border deals have involved Chinese groups bidding for US and European assets worth $61.7bn in total (source: FT).

 

Over the past few years Chinese companies have issued a large amount of US dollar denominated debt (see Russell Clark’s market note entitled ‘Spotting property Bubbles in East Asia’), in 2015 they sold a total of $60.3 billion worth of dollar-denominated bonds, more than six times the 2010 figure (source: Thomson Reuters data). In August last year, as China’s monetary authorities gave the signal that the Renminbi was not immune to devaluations, companies started to reduce their dollar exposure. Recently China SCE Property Holdings Limited said that it would redeem its $350 million senior note due 2017, while another real estate company, SUNAC China Holdings Limited said it had completed the redemption of its dollar note due next year.

 

China’s currency reserves declined by $420bn over the past 6 months and in January they plunged by $99.5bn (source: PBOC). The fund maintains a short exposure to sectors exposed to a renminbi devaluation such as luxury brands and Chinese property developers, and to other Asian currencies that would also have to devalue, such as the Korean Won and Singapore dollar.

In other words, another adherent to the “China will blow up” philosophy, which it may, however unlike Kyle Bass and a cohort of other China-bearish hedge funds, Horseman is instead betting on select Chinese sector shorts, as well as China’s currency devaluation although not by shorting the Yuan, and instead is bearish on the Won and the SGD.

What was the fund most bearish on? Pretty much everything, but a few sectors in particular:

However, what is most remarakable about the hedge fund, is that while it has maintained its gross exposure, as of January 31, the fund’s net short exposure has risen to a whopping 76%, an all time high, even for one of the world’s most bearish hedge funds.

 

Finally or those seeking to glean some wisdom from the Horseman’s inimitable Chief Investment Manager, Russell Clark, here is his latest letter.

* * *

My wife and I went see to the “The Big Short” the other day. It was certainly very amusing, and explained difficult financial concepts well. I will put it up there in my top three finance based films, along with “Trading Places” and “Margin Call”. I found Margin Call to be the least appreciated of these films, and yet for me most closely matches up to life in an investment bank in the 21st century.

For those that have not seen it, the film centres on a junior risk analyst, who discovers that the potential losses on the bank’s holding of mortgage assets were larger than its market capitalisation. He immediately informs his colleagues, who then pass it onto senior management. One of the recurring themes of the movie, is that the junior low paid staff are all maths and excel spreadsheet gurus, and the upper management are luddites. The junior risk analyst shows his excel model to management, and is constantly told “You know I don’t like these spreadsheets, just tell me what’s going on”. The analyst is eventually introduced to the Chairman of the Board, who asks him to “please, speak as you might to a young child. Or a golden retriever. It wasn’t brains that brought me here; I assure you that.”

If you were unfamiliar with the world of finance, you would think this grossly unfair. The brainboxes of the world toil endlessly, while their know-nothing bosses take home the big bucks. However, I think this is wrong. As the Chairman of the Board elaborates, the reason he earns the big bucks is, “I’m here for one reason and one reason alone. I’m here to guess what the music might do a week, a month, a year from now. That’s it. Nothing more.” The music in this case would be market prices.

The crux of the matter is that anyone telling you what the market is doing now, what the value of something is now, is providing you a freely available commodity; even if, in the cases of some derivative products, you need to be a rocket scientist to be able to give a valuation today. The real value add in markets is to be able to see what future values might be; that is to live in the future, not in the present.

I spend most of my time, while looking at current prices, thinking about and trying to live six months to one year in the future. Thinking about what will be the reaction to what is happening now, and then thinking about what that means future prices might look like. Generally that has worked well for me.

What I can see now is that US growth is slowing, and that the market is likely to price in reduced monetary tightening.

This should lead to a weaker dollar. This makes shorting Europe and Japan very appealing. Theoretically, this should make commodities and emerging markets (‘EM’) attractive, particularly if you are of the view that US dollar strength is the reason emerging markets and commodities have been so weak. However, I think we have chronic oversupply of commodities, and real financial issues in China that cannot be resolved easily. This makes commodity related areas very unattractive, despite the prospect of renewed monetary easing by the Federal Reserve. Furthermore, the reaction to reduced tightening by the Federal Reserve, would almost certainly be more easing by every other central bank in the world. But as we have seen recently with both the ECB and BOJ, monetary activism is not always effective.

I also worry about the prospects of a trade war, as populism becomes the new normal in politics globally. The future for me is now more uncertain than at any time I can remember. Or to fully quote the Chairman of the Board from Margin Call, “I’m here to guess what the music might do a week, a month, a year from now. That’s it. Nothing more. And standing here tonight, I’m afraid that I don’t hear – a – thing. Just… silence.”

Your fund remains long bonds, short equities.

via Zero Hedge http://ift.tt/1Qct1iw Tyler Durden

Submitted by Lance Roberts via RealInvestmentAdvice.com,

Wow…things are certainly happening faster than I expected. As January kicked off the new year, I posted my outlook for 2016 in which I discussed why, despite views of Goldman Sachs and many others, interest rates were going lower rather than higher.

“With the Federal Reserve raising interest rates on the short-end (Fed Funds), it will likely push the long-end of the curve lower as the economy begins to slow from the effects of monetary policy tightening.

 

From a purely technical perspective, rates have been in a long-term process of a tightening wedge. A breakout to the upside would suggest 10-year treasury rates would soar to 3.6% or higher, the consequence of which would be an almost immediate push of an economy growing at 2% into recession. The most likely path, given the current economic and monetary policy backdrop, will be a decline in rates toward the previous lows of 1.6-1.8%. (Inflation will also remain well below the Fed’s 2% target rate for the same reasons.)”

“Of course, falling rates means the ongoing “bond bull market” will remain intact for another year. In fact, if my outlook is correct, bonds will likely be one of the best performing asset classes in the next year.”

Here is that same chart today:

With interest rates now at my target levels in February, and bonds now extremely overbought, this is an opportune time to take some profits out of interest rate sensitive investments.

However, what the plunge in rates also suggests is that the economy is FAR weaker than Ms. Yellen, the mainstream financial media or the bullish blogosphere realize. Unfortunately, by the time the economic data is revised to reveal what rates are already telling you, it will be far too late to protect your investment capital.

But that is just my view. This weekend’s reading list, as usual, is a compilation of reads that provide both sides of the market and economic debate. Our job, as investors, is to reduce our confirmation bias in order to make more logical decisions with our money even though our emotions may be trying to lead us elsewhere. Hope, optimism and greed are all emotions that have led to far greater destructions of capital than negativity and fear ever have. 

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1) The Greatest Bull Market Of All Time by Ben Carlson via Wealth Of Common Sense

“How many hedge fund managers would kill for the following performance characteristics over a 40-year time frame?

• Annual Returns: 7.7%
• Volatility: 6.9%
• Number of Up Years: 37
• Number of Down Years: 3
• Annual Win %: 93%
• Worst Annual Loss: -2.9%
• Average Annual Loss: -1.9%
• Max Drawdown: -12.4%”

But Also Read: Equity Bubble Update by Jeremy Grantham via GMO

2) I Was Too Bullish by Matthew Belvedere via CNBC

“I was far too bullish last December,” Siegel admitted, referring to his call on “Squawk Box” that “valuations can stay on the high side.” He also had predicted on CNBC in November that Dow 20,000 was a “real possibility” in 2016. It was above 15,900 on Monday.

 

The Wharton School finance professor on Monday summed up his view on the headwinds to the market. “Those deflationary forces … from China, from commodities are really, in the presence of debt that so many of these energy and other companies have, … causing the market turmoil right now.”

Also Read: Just A Bullish Pause by Avi Gilburt via MarketWatch

Opposing View: Deteriorating Liquidity by Luke Kawa via Bloomberg

And Also: America’s Earning Recession Deepens by Alex Rosenberg via CNBC

3) Global Growth Fraying At The Edges by Gavyn Davies via FT

“The weakness in global risk assets that started in May 2015 raises a major question for macro-economists. Is market turbulence foreshadowing – or perhaps causing – a much broader weakening in global economic activity than anything seen since 2009?

 

Until now, the Fulcrum activity nowcasts have failed to identify a major turning point in global growth. This conclusion is still just about intact, but is subject to much greater doubt in this month’s report. There are some signs that growth in the advanced economies may be fraying at the edges, and China may be embarking on another mini downturn.”

Also Read: Clueless Economists & The Coming Recession by Aaron Layman

4) EVERYTHING YOU NEED TO KNOW ABOUT NIRP

• An Explanation Of Negative Rates by Econobrowser
• Negative Rates: A Giant Policy Failure by Narayana Kocherlakota
• The Fed May Follow Japan’s Path by John  Mauldin via Fortune
• The Futile Negative Rates Club by Daniel Gross via Project Syndicate
• Why Japan Went NIRP by Jeffrey Snider via Alhambra Partners
• Bizarro World Of Negative Rates by Marc Chandler via Real Clear Markets
• The New Frontier Of NIRP by Clive Crook via Bloomberg
• NIRP Confirms QE Failure by Jeffrey Snider via Real Clear Markets

5) Why Stocks Could Fall By 10-20% by Jack Bouroudjian via CNBC

“The market tone began to shift in December — and the warning signals started to flash red.

 

We started to witness a contraction in earnings for a couple of quarters in a row, which resulted in the price-to-earnings ratio of the S&P 500getting rich. We watched crude oil have a parabolic move to the downside as producers couldn’t pump fast enough. And we started to see the Federal Reserve move rates at a time when all the other central banks were doing the exact opposite which created risk aversion.

As it turns out, this became an I.O.U. market: interest rates, oil and uncertainty.”

But Also Read: 16 Charts The Explain The Market by Sam Ro via Business Insider

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MUST READS

• Markets Disappointed By Fed by Louis Woodhill via Real Clear Markets
• Wall Street Strategist Still Full Of Bull by Salil Mehta via Statistical Ideas
• 5 Questions To Ask Yellen by Mohamed El-Erian via Bloomberg
• Fed Made Recession Worse by David Beckworth & Ramesh Ponnuru via Bloomberg
• Why You Can’t Afford To Buy A House by Joel Kotkin via The Daily Beast
• Faster Growth Is A Panacea by Steve Chapman via Reason
• Easy Money No Help by John Hussman via Hussman Funds
• KISS – Applying It To Investing by Joe Calhoun via Alhambra Partners
• Jobs Report Full Of Oddities by John Crudele via New York Post
• 70% Of Obama’s Budget Is Writing Check To Individuals by Editorial Staff via IBD
• Recession Ahead by David Stockman via Contra Corner
• Pro’s Are Just Like Us by Meb Faber via Faber Research
• Comparing Yields To Rates Is Stupid by Jesse Felder via The Felder Report
• Shades Of 2000 & 2007 via Dana Lyons via Tumblr
• Effects Of Buybacks Exposed by Michael Lebowitz via 720 Global Research

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“A good player knows when to pick up his marbles.” – Anonymous

via Zero Hedge http://ift.tt/1QcA0hD Tyler Durden

 

 

 

By EconMatters

No real damage to shorts yet in the oil market, only a little flesh wound. I predict that by May 6th we are above $42 a barrel in WTI, lots of repositioning to come about by this date.

 

 

 

 

 

via Zero Hedge http://ift.tt/20t4GLl EconMatters