The Clinton/Obama Benghazi Scapegoating of Free Speech Continues to Hide in Plain Sight

No On September 11, 2012, at 7:30 p.m., when Ambassador Chris Stevens was still considered missing and soldiers Tyrone Woods and Glen Doherty were still alive, the White House convened an emergency teleconference of senior national security personnel, including Secretary of State Hillary Clinton, to discuss the ongoing chaos at the U.S. diplomatic annex in Benghazi, Libya. According to the House Select Committee’s Benghazi report released yesterday, “Five of the ten action items from the rough notes of the 7:30 p.m. meeting” concerned the YouTube trailer for Innocence of Muslims, a crude anti-Islam tract that demonstrators were using as justification for anti-American protests in Cairo and across the Muslim world. This despite the fact that there had been “no mention of the video from the agents on the ground” in Benghazi.

Republicans and other critics over the years have insinuated any number of darker motivations for the administration’s video-focused messaging in the aftermath of the deadly Benghazi attacks, from the Sept. 11 communique that the “U.S. Embassy Condemns Religious Incitement,” to Susan Rice’s infamous turn on the Sunday chat shows, all the way to President Barack Obama’s remarkable Sept. 25 assertion at the United Nations that “The future must not belong to those who slander the prophet of Islam.” But as a political exercise—and make no mistake: like all questionable governing activities involving Hillary Clinton, Benghazi was almost immediately reclassified by the mainstream media as a political/campaign horse-race story—the GOP shot itself in the foot by pining openly for some single piece of gotcha evidence to finally bring Clinton down.  

Sure enough, the MSM dutifully MSM’ed yesterday, with headlines like “Two years, $7 million, still no smoking gun on Clinton and Benghazi.” But as been in ample evidence since the first days after the attack, and documented at length within the Benghazi report itself, the evidence against Hillary Clinton and the Obama administration is damning when you take them at their own words. It’s not the nefarious explanation lurking between the lines, it’s the open explanation coming from their lips, that is deserving of withering criticism, and worth pondering in Clinton’s candidacy for president.  

Ed Krayewski detailed yesterday how the report reinforced the massive, deadly folly of America’s intervention into Libya, a Clinton-led initiative that the candidate has repeatedly (and grotesquely) characterized as “smart power at its best.” The same is true for the administration’s still-appalling scapegoating of American free-speech, and reflexive instinct toward censorship in a time of crisis.

Matt Olsen, then the director of the federal government’s National Counterterrorism Center, was present at that Sept. 11 White House teleconference. “The discussion of taking the video down was part of our conversation in this call.” Olsen testified to the Benghazi committee: “We were thinking about what had happened in Cairo, we were thinking, okay, now this seems to be happening in Benghazi, and we’re worried about…obviously, other diplomatic posts in the Middle East and North Africa….[O]ne of the issues that Denis [McDonough] asked me […] was to see if we could…contact Google to talk with them about enforcing their terms of service, which was the way that we often thought about offensive or problematic content.”

The administration indeed “often” thinks about “problematic content” when Muslims attack, threaten to attack, or just silently give off a seething vibe that they might attack, Americans and other westerners. On Sept. 19, 2012, Jay Carney was asked about the then-living editors of Charlie Hebdo publishing a new round of Mohammed cartoons. Here’s how Carney’s answer began:  

Well, we are aware that a French magazine published cartoons featuring a figure resembling the Prophet Muhammad, and obviously, we have questions about the judgment of publishing something like this. We know that these images will be deeply offensive to many and have the potential to be inflammatory.

This was no isolated act of media criticism. On Nov. 17, 2015, in the wake of the Paris attacks, Secretary of State John Kerry made the startling suggestion that the Charlie Hebdo murderers were just a tad more “legitimate” than the Bataclan butchers, due to the content of the cartoons:

There’s something different about what happened from Charlie Hebdo, and I think everybody would feel that. There was a sort of particularized focus and perhaps even a legitimacy in terms of—not a legitimacy, but a rationale that you could attach yourself to somehow and say, “OK, they’re really angry because of this and that.” This Friday was absolutely indiscriminate. It wasn’t to aggrieve [sic] one particular sense of wrong. It was to terrorize people. It was to attack everything that we do stand for.

Kerry walked the statement back in the heat of the moment, but this was in essence a “Kinsley gaffe“—the secretary of state was just blurting out the truth as he (and the administration, and his predecessor) sees it. After all, it was only last October, during a Benghazi hearing that was almost universally hailed as a political triumph, that Clinton asserted, to almost nary a negative reaction in the press, that the Charlie Hebdo cartoonists “sparked” their own murder. As I put it in my recent cover feature on “Hillary Clinton’s long war on free speech”:

“We had protests…all the way to Indonesia,” she told Congress in October. “Thankfully, no Americans were killed, partly because I had been consistent in speaking out about that video from the very first day when we knew it had sparked the attack on our embassy in Cairo.”

The word sparked is crucial here. American ambassador to the United Nations Susan Rice famously used it while making the rounds on the Sunday morning talk shows on September 16—”What sparked the recent violence was the airing on the Internet of a very hateful, very offensive video that has offended very many people around the world.” Clinton used it in front of Congress to describe the January 2015 Charlie Hebdo attacks, as a way of defending her continued emphasis on Innocence of Muslims as a partial explanation for Benghazi. “I think it’s important that we look at the totality of what was going on. It’s like that terrible incident that happened in Paris…[in which] cartoons sparked two Al Qaeda–trained attackers who killed…nearly a dozen people.”

But the metaphor is wrong in important respects that have implications for both speech and foreign policy. Innocence of Muslims, like the Danish cartoons before it, hung around unnoticed for months until they were picked up and spread around by Islamists looking to gin up outrage. These pieces of expression, in other words, were kindling, of which there is a nearly infinite supply. The Muslim-world popularizers poured metaphorical lighter fluid on the material they plucked from obscurity, and angry rioters caused the conflagration. By confusing spark with kindling, Hillary Clinton and other U.S. officials (plus many American intellectuals) are diverting some of the responsibility for violence away from the perpetrators and toward the creators of controversial speech.

You can see this throughout the Benghazi chapter in Clinton’s latest memoir, Hard Choices. “This was not the first time that provocateurs had used offensive material to whip up popular outrage across the Muslim world, often with deadly results,” she writes. Amazingly, she is not talking about the Islamists who dubbed Innocence of Muslims into Arabic and then broadcast it with fiery denunciation on Egyptian television, but rather the originator of the art, Nakoula Basseley Nakoula. Next sentence: “In 2010, a Florida pastor named Terry Jones announced plans to burn the Quran, Islam’s holy text, on the ninth anniversary of 9/11.” Once you begin to pin responsibility for faraway violence on acts of peaceful (if vulgar) free speech in America, the only thing standing between an artist and prison is an available crime.

This is now the mainstream Democratic opinion on the connection between western expression and Islamic terrorism, and Hillary Clinton is its most ardent and influential proponent. Whenever there is a new terrorist attack, you can bet and win money that one of Clinton’s go-to responses will be to crack down on free speech and privacy rights. She, Obama, Kerry, and the whole Democratic national security state believe sincerely that one of the best ways to protect Americans is to condemn other Americans (and Westerners writ large) for insulting Muslims. She does not begin to understand how such behavior might encourage the very terrorism she aims to prevent, by effectively rewarding bad behavior.

This, plus the whole U.S. intervention in the first place (of which Hillary Clinton was the most influential proponent), is and remains the most obvious and easy-to-prove scandal with Benghazi. It’s not some hidden footnote in a 600-page report; it’s the open policy of a fatally flawed administration, championed most vociferously by its proposed successor.

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41 Dead, 200+ Injured in Turkey Terrorist Attack, ISIS Suspected

The death toll in yesterday’s attack on the Ataturk international airport in Istanbul has risen to 41, with more than 200 people injured. At least 10 foreigners were killed, but as of yet no Americans were identified among the fatalities. Three suicide bombers attacked the airport, beginning outside the security perimeter, opening fire on the crowd before blowing themselves up,

The Turkish government declared Wednesday a day of national mourning. It is the deadliest attack since last October’s bombing of a peace rally in Ankara. The government blamed the Islamic State (ISIS) for both, but the terror group has not taken responsibility for either yet. ISIS generally claims responsibility for terror attacks relatively quickly.

President Barack Obama called Turkey President Recep Erdogan, telling him he “strongly condemned” the terrorist attack. Meanwhile, Secretary of State John Kerry argued that the attack was evidence that ISIS was getting “desperate.” House Homeland Security Chair Mike McCaul (R-Tex.) said that assessment “defies reality.” Kerry made a similar argument in March, saying the ISIS attack in Brussels signaled that the would-be caliphate was losing its “fantasy” of territorial sovereignty in the Middle East. Similar arguments were also deployed after the ISIS attack on Paris last November, which came just a day after Obama insisted ISIS was contained, something supporters of the administration did not believe Paris changed.

The Ataturk airport re-opened within 12 hours of the attack.

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The Prison Of Peoples – France’s Le Pen Calls For European ‘Spring’

Via VoxDay blog,

Marine Le Pen writes a powerful argument for nationalism and the end of the EU in the New York Times:

The European Union has become a prison of peoples. Each of the 28 countries that constitute it has slowly lost its democratic prerogatives to commissions and councils with no popular mandate. Every nation in the union has had to apply laws it did not want for itself. Member nations no longer determine their own budgets. They are called upon to open their borders against their will.

 

Countries in the eurozone face an even less enviable situation. In the name of ideology, different economies are forced to adopt the same currency, even if doing so bleeds them dry. It’s a modern version of the Procrustean bed, and the people no longer have a say.

 

And what about the European Parliament? It’s democratic in appearance only, because it’s based on a lie: the pretense that there is a homogeneous European people, and that a Polish member of the European Parliament has the legitimacy to make law for the Spanish. We have tried to deny the existence of sovereign nations. It’s only natural that they would not allow being denied.

 

Brexit wasn’t the European people’s first cry of revolt. In 2005, France and the Netherlands held referendums about the proposed European Union constitution. In both countries, opposition was massive, and other governments decided on the spot to halt the experiment for fear the contagion might spread. A few years later, the European Union constitution was forced on the people of Europe anyway, under the guise of the Lisbon Treaty. In 2008, Ireland, also by way of referendum, refused to apply that treaty. And once again, a popular decision was brushed aside.

 

When in 2015 Greece decided by referendum to reject Brussels’ austerity plans, the European Union’s antidemocratic response took no one by surprise: To deny the people’s will had become a habit. In a flash of honesty, the president of the European Commission, Jean-Claude Juncker, unabashedly declared, “There can be no democratic choice against the European treaties.”

 

Brexit may not have been the first cry of hope, but it may be the people’s first real victory.

With eloquent nationalist leaders like her, Viktor Orban, and Matteo Salvini, among others there is reason to believe it will not be the last one. The EU is immoral, unnatural, anti-democratic, and evil. The sooner it collapses, the better off everyone will be.

The globalists are the Nazis of the 30s and 40s and the Communists of the Cold War. They are the enemy of Man. As Le Pen aptly notes, "more and more, the destiny of the European Union resembles the destiny of the Soviet Union, which died from its own contradictions."

One thing is certain: Britain’s departure from the European Union will not make the union more democratic. The hierarchical structure of its supranational institutions will want to reinforce itself: Like all dying ideologies, the union knows only how to forge blindly ahead. The roles are already cast — Germany will lead the way, and France will obligingly tag along.

 

Here is a sign: President François Hollande of France, Prime Minister Matteo Renzi of Italy and acting Prime Minister Mariano Rajoy of Spain take their lead directly from Chancellor Angela Merkel of Germany, without running through Brussels. A quip attributed to Henry Kissinger, “Who do I call if I want to call Europe?” now has a clear answer: Call Berlin.

 

So the people of Europe have but one alternative left: to remain bound hand-and-foot to a union that betrays national interests and popular sovereignty and that throws our countries wide open to massive immigration and arrogant finance, or to reclaim their freedom by voting.

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Scathing new report shows just how bankrupt Social Security really is

Last week, a group of analysts published an astonishing report about the future of Social Security in the United States, and their remarks were nothing short of damning.

According to their calculations, for example, these analysts claim that Social Security is already running a huge deficit to the tune of tens of billions of dollars each year.

In fact, this Social Security funding deficit has been taking place for several years now, and it’s actually accelerating. So the problem worsens each year.

According to the analysis, the astounding rise in Social Security recipients vastly outpaces any growth in tax revenue received into the program. And this trend will continue for decades.

The report goes on to describe Social Security’s two main trust funds, OASI (for ‘Old Age Survivors Insurance’) and DI (‘Disability Insurance’).

They tell us that DI actually went bust several months ago.

But rather than attack the root cause of the problem and restructure the program, Congress quietly slapped a band-aid on DI by simply diverting funds from OASI, just enough for DI to limp along for a few more years.

So in other words, they robbed from OASI to pay DI, and keep it afloat through the next presidential election. It’s incredibly short-sighted.

Among the other programs slammed in this report, the Hospital Insurance (HI) fund, one of Medicare’s major trust funds, is of particular concern.

Their brutal analysis shows HI is going to completely run out of money in 2028, just twelve years from now (when President Clinton finishes her third term).

2028 is actually two years earlier than they had originally projected.

And they project the entire Social Security program will be fully depleted six years later in 2034.

Like I said, this report is incredibly damning.

But it raises an important question– just who are these crazy, fringe analysts predicting all of this doom and gloom?

After all, the political establishment has been telling everyone for years that Social Security is going to be just fine. And they seem to have a solid grip on the situation, right?

Well, the report was actually published by the Social Security Administration itself, signed by (among other cabinet officials) the Treasury Secretary of the United States of America.

It’s absolutely incredible. The government is publishing this data in black and white.

They’re telling anyone who’s willing to listen that Social Security has dug itself into an impossible hole.

More importantly, they’re telling us there’s a 0% chance that the government will be able to honor its existing commitments.

They’ll either have to radically raise taxes, or simply reduce (or eliminate) the Social Security benefits that they’ve been promising taxpayers for decades.

The younger you are, the steeper the price you’ll pay.

If you’re in your 60s, for example, you may likely see your benefits cut. If you’re in your 40s or 50s, you can count on it.

And if you’re in your 30s or younger, you can not only forget about Social Security, but you can expect to pay more and more taxes to bail out a program that won’t be there for you when it comes time for you to collect.

This is what happens when nations go bankrupt.

History is full of so many examples of dominant powers who think their wealth will last forever… and so they make far too many promises to far too many people for far too many years.

But eventually the reality of simple arithmetic catches up.

(As we discussed yesterday, arithmetic is slowly dying off in the Land of the Free, so perhaps this explains a thing or two).

We’re seeing this now in the US, and we’ll continue to see this problem worsen in the coming years until it becomes a full-blown emergency and people cry out, “Why didn’t anyone see this coming?!?”

Here’s the good news: you have ample time to prepare, and there are plenty of solutions to fix this.

Don’t get me wrong– I don’t mean “fix Social Security”. Oh no. That program is toast.

I’m talking about fixing this for yourself.

Retirement is one of those life events that is completely predictable. We know it’s going to happen.

And with a little bit of education, planning, discipline, and execution, we can vastly influence the outcome and prevent any major catastrophe from interfering with our goals.

You can dramatically boost your own nest egg, for example, and have much greater say over your retirement assets by setting up a structure like a solo 401(k) or a self-directed IRA.

(When structured properly, you can contribute potentially north of $50,000 per year to your retirement.)

It also makes sense to invest in your financial education; learning more about investing will clearly be beneficial in boosting your returns, and this can have a profound effect over time.

Especially if you’re younger, increasing your average return by just 1% over the course of 20-40 years can add up to hundreds of thousands of dollars in additional retirement savings.

You may also want to consider retiring abroad where you can live the lifestyle you’ve always wanted at a fraction of the price, and substantially stretch the time and value of your retirement savings.

Look, I’m convinced that Social Security will become a national emergency some day. Just remember that since its demise is conspicuously predictable, the impact on your life is completely preventable.

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Nine Years Paid Vacation for New Jersey Cop Accused of Sexually Assaulting Inmate

Who says police departments always move swiftly to protect their own? Sometimes it takes them almost nine years to find a fellow officer not guilty. Such is the case with Manuel Avila, a Paterson, New Jersey, cop who was accused of sexual assault in 2007. A local woman claimed that Avila had forced her to perform oral sex on him while she was in police custody. 

A few days before the alleged assault, a city psychiatrist had ruled Avila unfit to carry a weapon and recommended that he retire. Instead, police officials decided to reassign him for six months to a duty that didn’t involve carrying a weapon, at which point he would reach 20 years of service—a pension milestone. Avila was assigned to monitor munipcal holding cells. 

Avila was acquitted of criminal charges related to the alleged assault in 2010. The city settled a civil lawsuit with his accuser in 2011, agreeing to pay her $710,000. But somehow, the police department’s internal investigation persisted through early 2016. 

Throughout this time, Avila was on paid leave from the Paterson Police Department. By the end of his nine years on suspension, Avila had collected about $900,000 in income for doing nothing. With Avila’s pay, the settlement with his accuser, and legal fees, the city has spent about $1.9 million on this case. 

Perhaps Avila is innocent, but how could it possibly have taken the city nine years to determine this? “Why this took so long is beyond my control,” Mayor Joey Torres told the Paterson Press. “Definitely, this should have been settled long ago. I’m just glad we’re bringing it to closure.”

All disciplinary charges against Avila were dropped in February, according to a records request filed by Paterson Press. The city and Avila signed a settlement agreement under which Avila will retire, receive around $85,000 in “accrued money owed” for things like vacation and sick days, and may be eligible for lifetime medical benefits and pension payments. 

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The FED Finds a Good Excuse to Extend and Pretend Through Brexit

 

 

 

 


The FED Finds a Good Excuse to Extend and Pretend Through Brexit



Written by Nathan McDonald (CLICK FOR ORIGINAL)

 

 

 

Brexit has happened. Those who are not happy with this reality are making their voices heard; yet, so too are those who are overjoyed to have their liberty and freedom back in their own hands.

 

This divide is glaringly obvious and has been the highlight of the news reel since last week’s vote. There has been a flood of articles relating to the matter, and for good reason. This is a historic event and a move that slaps the global elites squarely in the face, something that rarely happens throughout our history.

 

Regardless, turbulent times are ahead for the global markets, as this move was considered a “black swan” event, one that was not expected by many, even by those who hoped it would happen. Even Nigel Farage, one of the leaders of the “Leave” campaign, suspected that the vote would be close, but didn’t hold out hope that they would win.

 

Therefore, it is no surprise to find that the FED is also shocked by this turn of events. They, along with many others, did not expect this to happen – but never fear! They will take advantage of the situation and use it as a full-blown excuse as to why they once again cannot act and raise interest rates.

 

Brexit has essentially given Janet Yellen a perfect excuse as to why she cannot raise rates. The FED has been jawboning about a raise in rates once again over the past few months, something that I have highlighted time and time again.

 

This MOPE is a constant theme at just about any press conference the FED attends. They must keep people thinking that they have some sort of power, that they can unravel this mess they have created in the fiat markets. The fact is they cannot, and they know this.

If Brexit didn’t occur, then the FED would have simply found another excuse to not raise rates. That, or they would have just engaged in more extend and pretend, pushing the idea down the road just a little further as they so often do.

 

Either way, near-rock bottom interest rates are here to stay as the U.S. dollar strengthens vs the pound and the Euro. As the elites say, never let a good crisis go to waste. Don’t worry – the FED isn’t.

 

 

 

Please email with any questions about this article or precious metals HERE

 

 

 

 

 

The FED Finds a Good Excuse to Extend and Pretend Through Brexit 



Written by Nathan McDonald (CLICK FOR ORIGINAL)

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Scotland Is About To Have Its Own Currency And Much More: How JPM Sees Brexit Playing Out

Several days ago, we showed a schematic of what Citigroup thought the post-Brexit political timeline would look like. This was released before Brexit was official.

 

 

Now that Brexit is official, JPM’s Malcolm Barr has come out with his base case forecast of “How Brexit Happens.” For those following the constant drama, there is little new here, except for one thing – the thing that caused a mini scandal earlier today during the EU Summit between Juncker and Rajoy – namely the treatment of Scotland. Here JPM said that it now expects Scotland to vote for independence and introduce its own currency before Britain leaves the European Union in 2019.

“Our base case is that Scotland will vote for independence and institute a new currency at that point (2019),” JP Morgan economist Malcolm Barr said in a note to clients on Wednesday. Scottish First Minister Nicola Sturgeon will meet European Commission President Jean-Claude Juncker on Wednesday afternoon, seeking a way for Scotland to remain in the EU. As Reuters reminds us, Scotland voted to stay in the EU in last week’s referendum, putting it at odds with the United Kingdom as a whole, which voted 52-48 percent in favor of Brexit.

If JPM is right, it means a historic split is in store for the United Kingdom which will see Scotland split politically from England and allign itself with the EU, something which would likely inspire a fresh wave of secessionist movements across Europe. Or, as the market would say, “bullish.”

* * *

Full note from JPM’s Malcolm Barr

How Brexit happens – our base case

There are myriad uncertainties in how the UK’s relationship with the EU will evolve in the wake of the referendum. In our minds, however, it is useful to lay out a base case as to how we think things will play out from here. It is highly unlikely events will align exactly to this script. But it useful to go through the exercise to help identify some of the key uncertainties along the way.
 
Phase 1 – Election of a new Conservative Leader and PM (result declared  9th September)

The near 125,000 members of the Conservative Party will choose from 2 candidates selected by MPs. Polling suggests approximately 75% of that group were pro-Brexit at the early stages of the campaign. It is very likely that the new Conservative leader will be elected on a platform of implementing the referendum result and taking the UK out of the EU.

Phase 2 – Article 50 (2016)

The incoming PM is likely to seek Parliamentary assent for submitting the formal article 50 request to leave the EU. With the EU refusing to begin talks before the article 50 request is submitted, our base case is this happens by the end of the year.  Constitutional experts argue about whether this is strictly needed or whether the new PM could act unilaterally. In practise we think it inevitable that the new PM would seek a Parliamentary assent given that the referendum is not legally binding. In our view, this is the crucial point wherein Brexit could be stopped, if it is to be blocked. Enough Conservative MPs (at this stage, we guess close to 20) would need to defy the leadership to prevent a motion from passing. This would likely generate a confidence vote and possibly a new general election if it occurs. Our base case is that Conservative MPs will fall in behind the leader and implement “the will of the people” as expressed in the referendum.

Phase 3 – Post Article 50 (2017)

Negotiations on the form of the EU exit begin soon after the article 50 request is submitted. On the EU side, the Commission will be acting on the basis of a mandate from the Council, and it appears representative from the Council will be involved on an ongoing basis. On the UK side, parties representing the constituent nations will likely be present. The EU will likely attempt to focus on the issues relating to exit in the first instance, rather than those relating to the future relationship with the UK. The UK side will likely seek to push toward the latter set of issues, and to seek as much access as possible to the single market while restricting free movement of labor.  In our base case, negotiations on exit issues will make progress, but progress on the forward looking issues will be negligible as time passes.

Phase 4 – Decision time (2018-19)

The UK will likely spend the first year of the negotiating process seeking to establish access to the single market on terms very similar to those seen during EU membership without accepting free movement of labour or contributions to the EU budget. We doubt this will be successful. Hence the UK will ultimately be forced to choose between a “Norway” option (accepting free movement of labour, EU regulations and budget contributions in return for full access to the single market) or an arrangement which has significantly less market access. At this point in time, the latter appears more likely. This means that access to the service sector (in particular) in the EU will likely be curtailed, along with some constraints on trade in goods. To the extent that UK economic growth is very weak during the negotiating process, the relative importance of market access versus migration control will shift in favour of the latter. However, our base case is that the hit from EU exit will demonstrate itself as a persistent drag on a positive growth rate, rather than generating  an ongoing contraction. As a result, the extent to which economic under performance will motivate a reassessment of UK priorities is ambiguous.
 
The UK will want to see the exit from the EU completed ahead of the general election in 2020. Submitting the article 50 request in late 2016 means that the standard two year negotiating period will expire in late 2018. However, the UK will likely secure agreement to extend the discussions into 2019, as the focus shifts onto the detail of a set of sectoral arrangements which provide some access to goods sectors beyond WTO terms. Discussion on access to some sectors extending beyond the WTO baseline will likely run beyond the 2020 election, while some sectors will see a reversion to WTO rules for a period while subsequent discussions are promised.
 
During all four phases of the above, we expect there to be clear evidence of multinational operations shifting the location of their activity out of the UK given the regulatory uncertainties. Financial services are among the sectors that will be most exposed to this process. Even if the UK begins to signal that it will compromise on other priorities in order to secure “full” access to the single market in financial services, there is a clear risk that euro-denominated activities relocate to within the EU simply to ensure continuity of relationships. In the event that it becomes clear that a given EU capital is the destination of choice, there is a possibility that this change could occur relatively quickly. The micro-economics of wholesale financial markets points toward sizeable externalities associated with the sharing of information and linkages between markets, hence its tendency to “clump” together within each time zone. 

Scotland

Intersecting the UK’s EU exit process is likely to be pressure to hold a new referendum on Scottish independence, which we expect will ultimately generate a vote shortly before the UK leaves the EU in 2019. Our base case is that Scotland will vote for independence and institute a new currency at that point. We will cover this issue in detail in a subsequent email.

Non-EU trade negotiations

As the UK’s likely exit from the EU becomes more concrete, there are three issues regarding non-EU trade. First is the need to renegotiate the UK’s trade arrangements with over 50 countries which were established while the UK was part of the EU (with the UK having signed them as part of the EU, they no longer apply once we exit). Second, the UK’s membership of the WTO has also been on the basis of its membership of the EU. The head of the WTO has stated that it is likely the UK will have to renegotiate the terms of its WTO membership, as at least some members will not be happy to simply allow UK membership to continue. Third, leave campaigners argued that the UK would be able to strike its own trade deals with countries like the US, China and India upon leaving the EU, so there may be the beginnings of some effort in that direction.
 
All of the above issues are likely to prove intricate and time consuming. The UK starts from a position where it does not have a deep well of resources and experience within the civil service to deal with trade issues. The UK’s negotiating position in these discussions is also likely to be very weak. The simultaneous loss or scaling back of such a large number of trading relationships upon EU exit is likely to be a blow to UK exporters, meaning the need to get a successor deal is more urgent for the UK than for our trading partners. The UK may hope that progress on these issues could be made both before the EU exit is completed and before the full set of follow-on arrangements in our relationship with the EU is clear. However, our non-EU trading partners are likely to want to see the detail of the UK’s relationship with the EU before considering the detail of any bilateral deal with the UK, as there are important interdependencies between those sets of relationships.  Put all of this together, and it is likely that the UK’s access to non-EU markets will become markedly more constrained in the wake of the EU exit for a period of years. And to the extent that the UK is able to secure “quick” deals, it is unlikely they will be on terms which are advantageous to the UK.

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Oil Jumps Above $49 As Crude Production Tumbles, Inventories Drop

Following last night's across the board inventrory drawdown from API, DOE data was more mixed with a surpsingly large build in gasoline stocks but bigger than expected Distillates and total crude inventory drawdowns. Production tumbled 0.63% MoM, the biggest drop in 2 months and back to Sept 2014 lows. Crude prices spiked above $49 for the firest time since Brexit.

API

  • Crude -3.86mm (-2.5mm exp)
  • Cushing -1.207mm (-900k exp)
  • Gasoline -416k
  • Distillates -832k

DOE

  • Crude -4.05mm (-2.5mm exp)
  • Cushing -951k (-900k exp)
  • Gasoline +1.367mm
  • Distillates -1.801mm

6th week of crude inventory draws, Distillates back into drawdown as Gasoline built.

 

Interestingly as Cushing saw a draw, East Coast inventories are soaring…

  • U.S. EAST COAST GASOLINE STOCKS ROSE TO RECORD LEVELS LAST WEEK – EIA

Production dropped the most in 2 months…

 

Which has sent crude prices back above $49…

 

Charts: Bloomberg

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‘Elites’ Called To Arms: “It’s Time To Rise Up Against The Ignorant Masses”

It appears the powers that be just are not going to take it anymore. Having mistakenly allowed the people of Britain to exercise their free will, Foreign Policy's James Traub exclaims, "It's time for the elites to rise up against the ignorant masses."

The Brexit has laid bare the political schism of our time. It’s not about the left vs. the right; it’s about the sane vs. the mindlessly angry…

Authored by James Traub, originally posted at ForeignPolicy.com,

I was born in 1954, and until now I would have said that the late 1960s was the greatest period of political convulsion I have lived through. Yet for all that the Vietnam War and the civil rights struggle changed American culture and reshaped political parties, in retrospect those wild storms look like the normal oscillations of a relatively stable political system. The present moment is different. Today’s citizen revolt — in the United States, Britain, and Europe — may upend politics as nothing else has in my lifetime.

In the late 1960s, elites were in disarray, as they are now — but back then they were fleeing from kids rebelling against their parents’ world; now the elites are fleeing from the parents. Extremism has gone mainstream. One of the most brazen features of the Brexit vote was the utter repudiation of the bankers and economists and Western heads of state who warned voters against the dangers of a split with the European Union. British Prime Minister David Cameron thought that voters would defer to the near-universal opinion of experts; that only shows how utterly he misjudged his own people.

Both the Conservative and the Labour parties in Britain are now in crisis. The British have had their day of reckoning; the American one looms. If Donald Trump loses, and loses badly (forgive me my reckless optimism, but I believe he will) the Republican Party may endure a historic split between its know-nothing base and its K Street/Chamber of Commerce leadership class. The Socialist government of France may face a similar fiasco in national elections next spring: Polls indicate that President François Hollande would not even make it to the final round of voting. Right-wing parties all over Europe are clamoring for an exit vote of their own.

Yes, it’s possible that all the political pieces will fly up into the air and settle down more or less where they were before, but the Brexit vote shows that shocking change isn’t very shocking anymore. Where, then, could those pieces end up? Europe is already pointing in one direction. In much of Europe, far-right nativist parties lead in the polls. So far, none has mustered a majority, though last month Norbert Hofer, the leader of Austria’s far-right Freedom Party, which traffics in Nazi symbolism, came within a hair of winning election as president. Mainstream parties of the left and right may increasingly combine forces to keep out the nationalists. This has already happened in Sweden, where a right-of-center party serves as the minority partner to the left-of-center government. If the Socialists in France do in fact lose the first round, they will almost certainly support the conservative Republicans against the far-right National Front.

Perhaps these informal coalitions can survive until the fever breaks. But the imperative of cohabitation could also lead to genuine realignment. That is, chunks of parties from the left and right of center could break away to form a different kind of center, defending pragmatism, meliorism, technical knowledge, and effective governance against the ideological forces gathering on both sides. It’s not hard to imagine the Republican Party in the United States — and perhaps the British Conservatives should Brexit go terribly wrong — losing control of the angry, nationalist rank and file and reconstituting themselves as the kind of Main Street, pro-business parties they were a generation ago, before their ideological zeal led them into a blind alley. That may be their only alternative to irrelevance.

The issue, at bottom, is globalization. Brexit, Trump, the National Front, and so on show that political elites have misjudged the depth of the anger at global forces and thus the demand that someone, somehow, restore the status quo ante. It may seem strange that the reaction has come today rather than immediately after the economic crisis of 2008, but the ebbing of the crisis has led to a new sense of stagnation. With prospects of flat growth in Europe and minimal income growth in the United States, voters are rebelling against their dismal long-term prospects. And globalization means culture as well as economics: Older people whose familiar world is vanishing beneath a welter of foreign tongues and multicultural celebrations are waving their fists at cosmopolitan elites. I was recently in Poland, where a far-right party appealing to nationalism and tradition has gained power despite years of undeniable prosperity under a centrist regime. Supporters use the same words again and again to explain their vote: “values and tradition.” They voted for Polishness against the modernity of Western Europe.

Perhaps politics will realign itself around the axis of globalization, with the fist-shakers on one side and the pragmatists on the other. The nationalists would win the loyalty of working-class and middle-class whites who see themselves as the defenders of sovereignty. The reformed center would include the beneficiaries of globalization and the poor and non-white and marginal citizens who recognize that the celebration of national identity excludes them.

Of course, mainstream parties of both the left and the right are trying to reach the angry nationalists. Sometimes this takes the form of gross truckling, as when Nicolas Sarkozy, who is seeking to regain France’s presidency, denounces the “tyranny of minorities” and invokes the “forever France” of an all-white past. From the left, Hillary Clinton has jettisoned her free-trade past to appeal to union members and others who want to protect national borders against the global market. But left and right disagree so deeply about how best to cushion the effects of globalization, and how to deal with the vast influx of refugees and migrants, that even the threat of extremism may not be enough to bring them to make common cause.

The schism we see opening before us is not just about policies, but about reality. The Brexit forces won because cynical leaders were prepared to cater to voters’ paranoia, lying to them about the dangers of immigration and the costs of membership in the EU. Some of those leaders have already begun to admit that they were lying. Donald Trump has, of course, set a new standard for disingenuousness and catering to voters’ fears, whether over immigration or foreign trade or anything else he can think of. The Republican Party, already rife with science-deniers and economic reality-deniers, has thrown itself into the embrace of a man who fabricates realities that ignorant people like to inhabit.

Did I say “ignorant”? Yes, I did. It is necessary to say that people are deluded and that the task of leadership is to un-delude them.

Is that “elitist”? Maybe it is; maybe we have become so inclined to celebrate the authenticity of all personal conviction that it is now elitist to believe in reason, expertise, and the lessons of history. If so, the party of accepting reality must be prepared to take on the party of denying reality, and its enablers among those who know better. If that is the coming realignment, we should embrace it.

via http://ift.tt/29eVYiB Tyler Durden