RBA Preview: Beware Of Doves, Leaks And Stop Hunts

In addition to the Chinese Caixin Manufacturing PMI due out shortly, which will either confirm or deny Sunday’s modest decline in the official Mfg PMI, the Reserve Bank of Australia’s (RBA) decision (due at 2:30pm Sydney time) headlines the region’s risk events this week.

All of those surveyed expect the RBA to stand pat, which would leave its cash rate sitting at 1.50%. The minutes from the July meeting reaffirmed labor and housing markets as particular areas of interest, with both leaving many questions unanswered. The most interesting note to take from the minutes was the discussion surrounding the neutral interest rate, which some market participants deemed as hawkish, and which sent the AUD surging. However, in his most recent address last week, RBA Governor Lowe turned unexpectedly dovish and rejected this view, with Westpac suggesting that he reinforced the Bank’s ‘firmly on hold’ stance. Lowe also tried to talk down the currency, stating that it “would be better if the AUD was a bit lower”.

This was underscores by last week’s sub-consensus headline 2Q CPI print (0.2% QoQ vs. 0.4% expected) which supports the RBA’s view that domestic inflationary pressures are lacklustre, but officials may take some comfort in the slightly firmer core readings, according to analysts at ING.

Despite rhetoric from Lowe and his deputy Guy Debelle the AUD has continued to rally, so any language pertaining to the domestic currency will be closely scrutinized. Heading into the announcement, the Australian dollar has been rising amid concerns the RBA may talk down a currency that’s trading near the highest level in more than two years. At pixel time, AUDUSD trades back above 0.80, rising as high as 0.802 with the next resistance the July 27 high of 0.8066, a level unseen since May 2015.

As RBC adds, while there is some risk the RBA is forced to nudge its near-term growth forecasts lower, the longer-term profile is still likely to show an expectation of a return to above-trend growth and within-target inflation. Its confidence around these forecasts has likely increased given recent data on the global and domestic economies, though the bank adds that it “still expects the message to remain clear enough that rates are unlikely to move in either direction for some time yet.”

On Friday, the RBA’s Statement on Monetary policy (SoMP) will supplement the decision. No material revisions are foreseen within the economic projections.

In terms of the bigger picture, RanSquawk points out that ANZ posit Lowe’s most recent rhetoric suggests that “financial stability seems to rule out further rate cuts. This is not necessarily the case, in our view. Importantly the current choice is against the backdrop of an expected improvement in the economy. Should this improvement falter then the trade-offs facing the RBA will change significantly.

In other words, while immediate upside in the pair may be capped, a strong emphasis on the recent dovish rhetoric could send the AUDUSD plunging. Should stops be taken out to the downside, the pair could plunge as much as 150 pips according to some.

FX traders will want to keep a close eye on sharp AUDUSD moves seconds before the announcement: on at least one occasion, most famously in April 2015, the RBA statement was leaked in advance, with the entire currency move taking place roughly 7 seconds before the official release.

h/t RanSquawk

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Beijing Blowback Begins: China Orders Anbang To Sell Its Overseas Assets

Two weeks ago, when discussing the troubles plaguing one of China’s conglomerates and “boldest dealmaker”, HNA Group – recently best known for acquiring Anthony Scaramucci’s SkyBridge capital in a transaction that has yet to close – we said that what until recently was one of the world’s most aggressive roll-ups of varied companies from around the globe, including stakes in Hilton Companies and Deutsche Bank, as well as countless Chinese acquisitions, could very soon become the “reverse roll-up from hell”, as the stock price of HNA tumbled, putting the roughly $24 billion in loans that had been taken against HNA stock in jeopardy of breachin their LTV limits, forcing a massive margin call, and potential firesale liquidation of the company’s assets as shown in the chart below…

… which have been hit with the double whammy of various rating agency downgrades in recent months, further eroding the collateral value of all of HNA’s various assets.

Yet while the fate of HNA’s conglomerate future still remains largely in the hands of the market, which could easily prompt a firesale if it were to push HNA stock low enough, another Chinese conglomerate may not have the benefit of the market’s potential generosity, because according to Bloomberg, Chinese authorities have asked HNA’s peer, Anbang Insurance Group, the insurer whose chairman was recently detained in June and was classified as a potential “systemic risk” to China’s economy, to sell its overseas assets.

In addition to demand a liquidation of many if not all assets acquired by Anbang over the past three years, the government also asked the company – whose Chairman will surely comply following his brief “detention” – to bring the proceeds back to China after disposing of holdings abroad, suggesting not only growing concerns about Chinese capital outflows, but Beijing’s apparent intention to undo the massive Chinese M&A wave that swept the globe from 2014  through most of 2016, and led to the infamous “Chinese acquisition premium.”

Bloomberg notes that it is not clear yet how Anbang will respond, and in a WeChat message, the insurer said that “Anbang at present has no plans to sell its overseas assets,” although that is sure to change once Beijing asks again, less politely this time. “Currently, Anbang’s various businesses and operations are all normal, and the company has ample cash and sufficient solvency capabilities.”

Anbang, together with HNA, Wanda and Fosun, were the four most prominent Chinese conglomerates which unleashed a buying binge across the globe, fueled by soaring sales of investment-type insurance policies. Since 2015, the four companies completed a combined $55 billion in overseas acquisitions, 18% of Chinese companies’ total, and according to some, were instrumental in accelerating China’s capital outflows over the same period.

Anbang first emerged in the public arena with its high profile 2014 acquisition of New York’s Waldorf Astoria hotel. Subsequently, Anbang and its peers acquired such trophy assets as AC Milan, Legendary film studios and Hilton Worldwide.

Anbang alone made billions in acquisitions in such businesses as the Westin St. Francis, InterContinental Miami, Rabobank’s mortgage portfolio and various other M&A targets around the globe.

However, it all ended with a thud in mid-June, when Anbang Chairman Wu Xiaohui was detained for questioning, while the policies fueling the company’s growth have been all but banned by regulators. At this moment Anbang is merely a shell corporation, with virtually no new business creation, one whose massive debt load threatens to careen the company soon if it does not find sources of cheap liquidity and fast.

At a twice-a-decade conference on financial regulation convened by President Xi Jinping this month, policy makers pledged to rein in corporate borrowing and said that preventing systemic risk was an “eternal theme.”

Making matters worse is that Anbang’s rise in recent years was fueled by sales of lucrative wealth-management products that offered among the highest yields compared with peers, a key spoke of China’s $9 trillion shadow banking universe. China’s insurance regulator this year started clamping down on what it termed “improper innovation” and tightened rules on high-yield, short-term investment policies. Anbang and other aggressive insurers such as Foresea Life got caught up in the crackdown.

Where Anbang’s death spiral could turn especially aggressive, is if Anbang customers start surrendering their policies and stop buying new ones, a feedback loop that would accelerate a continuing cash drain at the company, while forcing its existing product suite of wealth products to default, leading to the biggest risk facing China’s economy: a shadow bank run.

One Anbang product, called Anbang Longevity Sure Win No. 1, boosted the firm’s life insurance premiums almost 40-fold in 2014 by offering yields as high as 5.8 percent. That helped provide fuel for the firm’s more than $10 billion of overseas acquisitions since 2014 and equally ambitious investing in the domestic stock market.

If investors realize that not only China’s M&A party is over, but that the shadow banking sector is facing a potential default cliff, the scramble to recover invested capital will be unprecedented.

For now, Anbang can delay the inevitable cash call by following Beijing’s demands, and slowly – at first- begin liquidating its trophy offshore assets, and repatriating the proceeds, effectively inverting the outbound M&A surge that marked the past three years. The good news is that at least at this moment, there are plenty of willing buyers for the upcoming Anbang firesale..

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Trump Must Embrace His Revolutionary Self Or Politically Perish

Authored by Andrew Korybko via OrientalReview.org,

President Trump’s first six months in office have left his supporters with decidedly mixed feelings.

There are those who still “believe” in him and are convinced that he’s perfectly executing some “master plan”, while there are others who have given up all hope on him and are convinced that he disappointedly “sold out”.

The reality, as it usually is, lies somewhere between these two extremes.

Trump has clearly made several major foreign policy concessions to his opponents in the permanent military, intelligence, and diplomatic bureaucracies (the “deep state”), though he doesn’t seem to have fully given up on his campaign promises to be a revolutionary president.

What happened, though, was that the “deep state” expertly exploited Trump’s deal-making propensities to push him into a corner and capture control of most of his administration’s foreign policy.

Trump’s appointment of multiple individuals with a neoconservative worldview completely contradictory to the one that he campaigned on isn’t “to keep his political enemies forever guessing his real intentions”, as everybody already knew what he supposedly intended to do if he was ever elected president.

Instead, these people were placed in their respective positions because Trump was conned into thinking that he was cutting a deal with the “deep state” whereby he sacrificed some of his ambitiously revolutionary foreign policy promises in exchange for encountering less opposition to the implementation of his desired domestic agenda.

As could have been expected, the “Republicans In Name Only” (RINOs) didn’t abide by this “gentlemen’s agreement” between the President and the “deep state”, and they continued to make it all but impossible for Trump to govern except in the select instances when he could rely on Executive Orders.

Whereas Trump thought that he was wheeling and dealing in the foreign policy sphere in order to obtain advantageous outcomes in the domestic one, he soon found out that the domestic and foreign policies of the US are so intertwined as to be inseparable, meaning that a loss on one front inevitably leads to further losses on the other.

Trump has thus been caught in a trap from which he’ll have immense difficulty escaping, and which requires legendary “deep state” management skills and strategies to reverse, if it’s even possible to do so after all the negative momentum that he’s been tricked by his adversaries into generating.

Reflecting on how he got into this whole mess, it’s obviously due to the inter-services “deep state” collaboration which concocted the conspiracy theory about “Russia’s intervention” in the 2016 elections, and which therefore placed Trump on the strategic defensive and made him more likely to inadvertently enter into a series of disadvantageous deals.

Now that his back is to the corner on both the foreign and domestic policy fronts, Trump has no choice other than to embrace his revolutionary self that was proudly on display during the campaign trail if he wants to stand any feasible chance at implementing his policies.

It’s presumed that he’s working behind the scenes with his trusted advisors to slowly but surely place “his people” into key positions so as to facilitate this at a later time, but the clock is ticking, the momentum is turning against Trump, and he’s already been pressured into walking back many of his promises, whether as “tactical retreats” for the short term or as genuine strategic reversals.

If President Trump doesn’t bullishly embrace “Candidate Trump”, then he’s bound to politically perish and go down in history as one of the most ineffective and hamstrung leaders that the US has ever seen.

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Hong Kong Interbank Rates Spike To Highest Since Lehman

For only the third time since Lehman, the price of liquidity in the Hong Kong Dollar interbank markets has exploded higher.

Overnight HKD Hibor soared over 60 basis points to 0.71407% in Monday trading – the highest since October 2008…

 

Note that the two previous spikes were around year-end, so this is unusual in both its velocity and size.

Of course, the narrative of a panic in Asian liquidity is not a good one for supporting risk assets and so the spike is being dismissed as a one-off due to several factors (as Bloomberg reports)…

Monday’s rise in Hong Kong dollar overnight interbank rate was due to major fund providers being more cautious in lending at month-end, and because of demand from some market players, a Hong Kong Monetary Authority spokesperson writes in an emailed reply to questions from Bloomberg. Interest rates subsided when fund providers responded by lending out more Hong Kong dollars. Relatively large movements in short- dated interest rate Monday was probably a result of thin market conditions ahead of the month-end. The market continued to function normally.

 

Monday’s sudden spike in HKD overnight funding cost is probably due to short-term funding activities, likely for I Squared Capital’s purchase of Hutchison Telecom’s unit and HSBC share buyback announcement, says Angus To, deputy head of research at ICBC International Research.

Rate likely to drop soon as HKD liquidity remains ample in general, To says in a phone call.

So just ignore the fact that the HKD liquidty markets just exploded due to month-end (well it hasn't before – see chart) and some M&A (there's been no M&A in the last 9 years?)… it's probably nothing.

 

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Rep. Brad Sherman (D-CA) Walks Out Of Interview After Question About Awans

Independent journalist Austin Fletcher went to this year’s Politicon in Pasadena, CA to cover the festivities and interview some folks – one of whom was Democratic congressman Brad Sherman, from Sherman Oaks, CA.

After cracking a cardboard joke about “Sherman from Sherman Oaks” I’m sure his wife never gets tired of, Fletcher asked a question about the Awan brothers – Debbie Wasserman Schultz’s Pakistani IT staffers who had access to the emails of the entire House of Representatives – including Brad Sherman, who is a senior member of the House Foreign Affairs and Financial Services Committees, and is the top Democrat on the Subcommittee on International Terrorism, Nonproliferation and Trade.

Witness a man who collects $174k from the taxpayer dodge a simple question. Of course, Sherman probably also realizes House Democrats have been severely compromised by the Awans, and anything he says or does can and may be used against him in a court of law.

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The Race Against Time

Authored by Jeff Thomas via InternationalMan.com,

For decades, in discussing the ever-increasing hegemony of the world’s principal governments (US, EU, et al.), I’ve been asked repeatedly, “When will the governments understand that this obsession they have to become all-powerful is not in the interests of the people?”

The answer to this question has also remained the same for decades: never.

Although most all thinking people will readily admit that they regard their government (and governments in general) to be both overreaching and corrupt, they somehow attribute political leaders with a desire to serve the people. This is almost never true.

In my own experience in working with (and against) political leaders in multiple jurisdictions, I’ve found them to be remarkably similar to each other in their tendency to be shortsighted, self-aggrandising, and almost totally indifferent to the well-being of their constituents. Indeed, it’s a real rarity to encounter a political leader who does not fit this description.

Therefore, we should take as a given that all political leaders will continue to pursue their own power and wealth, at the expense of their citizenries.

This, then, begs the question: “If they won’t stop themselves in this progression, is there no other outcome than eventual total slavery to the government?”

Well, here, history informs us that this is not the case. All governments will tax the people as much as they can, regulate them as much as they can, socially dominate them as much as they can, and remove as many rights as they can. However, they rarely totally succeed and, even when they do, the clock is ticking against them.

In 1999, I began to warn that the US military would steadily increase its warfare against other nations and would only cease their military expansion if and when economic collapse made it impossible to continue the expansion.

In 2008, I began to warn that the US, EU, and other jurisdictions would eventually attempt to eliminate the use of paper currency, or “cash,” and force all people to rely almost totally on electronic transfers of money. (I had pictured plastic credit cards being used—I hadn’t imagined at that time that smartphones would make such transactions even easier.)

In addition to the above abuses, I projected that these jurisdictions would become more collectivist, would increase legislation to dominate their citizens socially, and would eventually come to resemble police states.

But, at the same time, I projected that, although I believed that all these developments would increase steadily, both in magnitude and frequency, they would reach a peak point, then begin to unravel—and would do so more quickly than they had been implemented.

This would happen for two reasons, and neither of these reasons come from some crystal ball. They come from history.

As has always occurred, for millennia, such rapidly expanding excesses cannot be created by governments without creating debt. The more rapid the level of change, the greater the debt necessary.

Today, we’re witnessing the greatest level of debt the world has ever seen. As always in history, this is a ticking time bomb.

The second reason is that such rapidly-expanding excesses cannot be created by governments without creating resentment. The more rapid the level of change, the greater the resentment.

Taken as a whole, what this means is that all of the increased hegemony, of every type, rises to a peak, then collapses—often all at the same time.

We can see the economic warning signs as the financial institutions have run out of new measures and are now relying on band-aid measures. This tells us that we’re entering the final years (or possibly months) of the debt mania. Consequently, the only remaining measures will come under the heading of abuse to the consumer within the system.

Militarily, we see the end nearing, as the world becomes ever more resentful of the US as the self-imposed world policeman. (This is particularly acute outside of the US, as those who live outside the reach of the US media understand that the US has, for years, been inventing its excuses for warfare where there was no real justification.)

For many years, I’ve said that we’ll know that the unravelling will be very near when the creators of the abuse begin to realise that the hegemony is nearing its end and is due for a reversal.

Recently, two events have occurred that suggest that this part of the process has begun.

First, the EU has launched public consultation to get the pulse of the people of Europe on their War on Cash programme (which they term, “de-cashing”).

The findings, even though the questions were phrased to make it difficult to oppose the concept, indicate that more than 99% of respondents see no benefit in de-cashing. Further, 87% regard the use of cash as an essential personal freedom.

Although the people of Europe have tolerated one hit after another from Brussels, de-cashing may well prove to be their Waterloo.

As this was occurring, across the pond in the US, the military performed a study to learn how much further they can push the world with their present level of aggression and have determined that “the status quo that was hatched and nurtured by U.S. strategists after World War II,” and has been dramatically expanded in recent decades, “is not merely fraying but may, in fact, be collapsing.”

It’s often assumed that empires tend to expand until a point at which they subside, but this is not the case. Very much like a market bubble, they tend to reach a dramatic peak just before they collapse. Almost invariably, those who are the last to understand that the end is near are those who are at the very apex of power. Therefore, rather than back off their programme of hegemony, they expand it right until economic collapse destroys it. Like heroin addiction, greater amounts of the drug are injected, right until the fatal overdose takes its toll.

What this means to the reader is that, although he may either live in or in some way be under the control of one of the current empires, his lot is far from hopeless, but he must be wise enough to keep his powder dry until the collapse is under way.

From the present day until the collapse, the empires will increase taxation, increase regulation, increase warfare, increase social dominance, and remove the rights of their people in ever more dramatic ways.

Those who seek to sidestep this process might well pursue international diversification as a bridge to freedom. In this race against time, nations will make it increasingly difficult to escape, and freedom will only be realized after the collapse. The greater the preparedness today, the greater the likelihood of coming out the other side in several years with wealth and freedom intact.

*  *  *

Doug Casey can show you how to protect and increase your wealth and freedom during the coming collapse. You’ll find all the critical details in our Guide to Surviving and Thriving During and Economic Collapse. Click here to download your complimentary copy.

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Trump Saw A Disturbing Video, Then He Shut Down The CIA’s Covert Syria Program

While we've carefully documented the dynamics in play behind Trump's decision to end the CIA's covert Syria program, as well as the corresponding fury this immediately unleashed among the usual hawkish DC policy wonks, new information on what specifically impacted the president's thinking has emerged.

Thomas Joscelyn, a Middle East analyst for the Foundation for Defense of Democracies, explains in the August edition of The Weekly Standard:

Earlier this year, President Donald Trump was shown a disturbing video of Syrian rebels beheading a child near the city of Aleppo. It had caused a minor stir in the press as the fighters belonged to the Nour al-Din al-Zenki Movement, a group that had been supported by the CIA as part of its rebel aid program.

 

The footage is haunting. Five bearded men smirk as they surround a boy in the back of a pickup truck. One of them holds the boy’s head with a tight grip on his hair while another mockingly slaps his face. Then, one of them uses a knife to saw the child’s head off and holds it up in the air like a trophy. It is a scene reminiscent of the Islamic State’s snuff videos, except this wasn’t the work of Abu Bakr al-Baghdadi’s men. The murderers were supposed to be the good guys: our allies.

Trump pressed his most senior intelligence advisers, asking the basic question of how the CIA could have a relationship with a group that beheads a child and then uploads the video to the internet. He wasn't satisfied with any of the responses:

Trump wanted to know why the United States had backed Zenki if its members are extremists. The issue was discussed at length with senior intelligence officials, and no good answers were forthcoming, according to people familiar with the conversations. After learning more worrisome details about the CIA’s ghost war in Syria—including that U.S.-backed rebels had often fought alongside extremists, among them al Qaeda’s arm in the country—the president decided to end the program altogether.


Screenshot of the horrific video of a CIA-backed Syrian group beheading a boy named Abdullah Issa.

At the time the beheading video surfaced (July 2016), many in the American public naturally wanted answers, but the story never really picked up much momentum in the media. As Joscelyn describes, it caused nothing more than "a minor stir in the press." The State Department seemed merely satisfied that the group responsible, Harakat Nour al-Din al-Zenki, claimed to have arrested the men that committed the gruesome crime, though nothing more was known. Absurdly, a US government spokesperson expressed hope that the child-beheading group would "comply with obligations under the law of armed conflict."

The only press agencies that publicly and consistently challenged the State Department at the time were RT News and the Associated Press, yet even these attempts didn't get picked up beyond the confines of the State Department's daily briefing. When the AP's Matt Lee initially questioned spokesman Mark Toner as to whether Zenki would continue to receive any level of US assistance, Toner casually replied "it would give us pause" – which left Lee taken aback.

Meanwhile, it wasn't just the US government which had aided Zenki, but as fighting in Aleppo raged it became a favored group among both the mainstream media and prominent think tank pundits. One of the UK's major broadcasters (Channel 4) even went so far as to attempt to delete and hide its prior online content which sought to normalize the beheaders as "moderate" and heroic once news of the video got out.

Among think tankers, Zenki's most prominent public supporter, frequently presenting the terror group as actually representative of Syria's "secular" and supposedly democracy-promoting armed opposition (even after the beheading video emerged), was Charles Lister. Lister was finally confronted not by mainstream media, but by AlterNet's Max Blumenthal at a DC event held by the (largely Gulf funded) Atlantic Council.

Only by the time of this January 2017 public forum, and after being persistently questioned, did Lister awkwardly back off his previous enthusiastic promotion of Zenki:

We can imagine that Trump saw other things beyond the shocking Zenki beheading video which made him fully realize the utter criminality of the CIA program (Thomas Joscelyn further emphasizes that Trump came to understand the full scope of CIA cooperation with al-Qaeda in Syria).

The only question that remains is who in the CIA or Obama-era State Department should be prosecuted first?

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Judge Napolitano: Awans Had Access To ‘Virtually Everything’ In House of Representatives, Sold Information

Content originally published at iBankCoin.com

The rapidly unfolding case against Debbie Wasserman Schultz’s apparent Pakistani IT spy ring already had huge implications for National Security. We now learn that the investigation into the the Awan family encompasses more than just the Democrats they were working directly for.

Judge Andrew Napolitano appeared on Fox Business Network on Monday where he dropped a new bombshell: not only did the Awans had access to the emails of every member of the House of Representatives, Imran Awan reportedly sold information to still unknown parties, which the FBI is currently investigating.

Napolitano: He was arrested for some financial crime – that’s the tip of the iceberg. The real allegation against him is that he had access to the emails of every member of congress and he sold what he found in there. What did he sell, and to whom did he sell it? That’s what the FBI wants to know. This may be a very, very serious national security situation.

 

Varney: Wait a second, he was the IT worker along with his two Pakistani brothers, for DWS, and other Democrats in the House – and the theory is that he got access to all of their secrets or whatever, and sold some?

 

Napolitano: Yes, and this was at the time that Congresswoman Schultz was also the chair of the Democratic National Committee. So at this point I don’t believe they know what he sold, and to whom he sold it – but they do know what he had access to, which is virtually everything in the House of representatives, which would include classified material in the House intelligence committee.

Watch:

  

And as The Gateway Pundit reported Thursday – the Awans were sending sensitive information to the Muslim Brotherhood.

Per Josh Caplan @ GWP:

The explosive claim is backed up by a report in Frontpage Magazine linking the Awan brothers to the Muslim Brotherhood. The Pakistani IT staffers worked for Democrat Congressmen Andre Carson as well.

Frontpage reported:

The office of Andre Carson, the second Muslim in Congress, had employed Imran Awan. As did the offices of Jackie Speier and Debbie Wasserman Schultz; to whom the letter had been addressed.

 

Carson is the second Muslim in Congress and the first Muslim on the House Permanent Select Committee on Intelligence and, more critically, is the ranking member on its Emerging Threats Subcommittee. He is also a member of the Department of Defense Intelligence and Overhead Architecture Subcommittee.

The Emerging Threats Subcommittee, of which Carson is a ranking member, is responsible for much of counterterrorism oversight. It is the worst possible place for a man with Carson’s credentials.

 

Carson had inherited his grandmother’s seat and exploited it to promote a radical Islamist agenda. He has interfaced with a laundry list of Islamist groups from CAIR to ISNA to ICNA to MPAC. Islamists have funded Carson’s career to the tune of tens of thousands of dollars. The Center for Security Policy has put together a dossier of Carson’s connections to the Muslim Brotherhood. The Brotherhood is the parent organization of many key Islamic terror groups posing a threat to our national security including Al Qaeda and Hamas.

 

Andre Carson shared the stage at a CAIR banquet with Sirraj Wahaj: an unindicted co-conspirator in the World Trade Center bombing who had once declared,” You don’t get involved in politics because it’s the American thing to do. You get involved in politics because politics are a weapon to use in the cause of Islam.” CAIR itself had been named an unindicted co-conspirator in terror finance.

It’s ironic the Awan brothers cry Islamophobia, when in all actuality, the religion they practice deserves all the scrutiny it receives. Simply put, the Awan brothers are of the Muslim faith sending sensitive information to Islamic fundamentalist group, Muslim Brotherhood.

Watch:

I wonder what’s on that laptop Debbie Wasserman Schultz threatened the chief of DC Capitol Police over?

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Meanwhile, Somewhere In The Pentagon…

Authored by Charles Hugh Smith via OfTwoMinds blog,

The decision to launch nuclear weapons is political, not military.

As North Korean supreme leader Kim Jong Un declares that "The Entire US Territory Is Now Within Our ICBM Range", somewhere in the Pentagon, operational plans to neutralize North Korean nuclear and long-range missile capabilities are being refined.

There are undoubtedly two sets of operational plans: one deploying conventional weapons, and the second for deployment of nuclear weapons.

Nothing personal, Mr. Kim Jong Un, it's just business. A core duty of planners in the Pentagon is to ask "What if" and draw up a range of scenarios and operational plans to carry out the civilian leadership's policies and decisions.

One such scenario is "what if North Korea launches a ballistic missile that is tracking to strike U.S. territory?"

One response option in this scenario would be to wait and see if the North Korean missile hits the U.S. and if it is armed with a nuclear weapon, and if so, if the warhead detonates.

Another option is to respond immediately with a nuclear strike that neutralizes North Korea's ability to launch any more nuclear-armed missiles.

The U.S. Armed Forces does not declare war or make the decision to launch a nuclear strike–that is the perogative and responsibility of the nation's civilian elected leadership. The duty of the U.S. Armed Forces is to be prepared to execute the decisions and policies of the elected civilian leadership.

The ethical considerations of such a decision are not the Pentagon's purview–those considerations rest with the elected civilian leadership. If North Korea is poised to kill 2 million Americans, South Koreans, Japanese, etc., then isn't erasing North Korea's capability to kill millions at the cost of 50,000 North Korean lives in a limited nuclear strike the more ethical choice?

Those considerations are not part of operational plans. The purpose of operational plans is to get the assigned job done. Limiting civilian casualties might well be part of the assigned mission. But it's not the Pentagon planners' job to make those mission decisions.

There are no small nuclear explosions, but there are smaller explosions and variations that have profoundly different consequences. Ground-burst detonations carve out craters and send shock waves through the earth that crumple tunnels, bunkers, elevator shafts, etc. Ground-burst detonations generate vast quantities of radioactive particles. Since it's well known that North Korea has buried its most precious nuclear resources deep underground, ground-burst detonations would be the only way to disrupt the access routes to bunkers deep underground.

Air-burst nuclear detonations generate field effects, i.e. electromagnetic pulses across the spectrum. These can be "tuned" to some degree. Thus a neutron-type weapon is designed to sicken and kill enemy soldiers while leaving buildings and equipment intact. This might be the weapon of choice to neutralize any attempt by the North Korean Army to launch a devastating artillery attack on South Korea in retaliation for the destruction of North Korea's missile and nuclear capabilities.

Air-burst field effects often include massive disruption of electronic equipment. This might limit the operational plans for air-burst nuclear detonations near ther DMZ, as technologically advanced South Korea might well suffer significant economic losses from an air burst near the border with North Korea.

By the same token, an air-burst nuclear detonation over North Korean military communications headquarters might be considered essential to distrupt the North Koreans' command and control capabilities.

My point here is that operational plans to decapitate North Korean nuclear and ICBM capabilities exist and are constantly being revised and refined in light of new intelligence. It's not the planners' job to make the geopolitical or ethical calculations that inform such a drastic decision. It's the planners' job to make sure a strike ordered by the elected civilian leadership of the nation achieves its goal, i.e. eliminates North Korea's nuclear and missile delivery capabilities completely.

It's easy to say nuclear weapons should never be used, but what if conventional weapons can't do the job, or create greater risks? Would you consider it a good ethical trade-off to wait for millions to die before killing thousands? That's a political choice, and one that will always be second-guessed or disputed. But making such decisions is the purpose of elected civilian government.

The planners job is much more direct. If the elected civilian government orders the neutralization of North Korea's ability to kill millions of civilians in South Korea, Japan or the U.S., then the job boils down to aligning existing resources and reckoning how many resources will be needed to get the job done in the most effective way available.

A conventional-weapons strike would likely require hundreds (and possibly thousands) of aircraft sorties, and all that such a monumental effort entails. It would also requires a significant amount of time to execute. A nuclear strike requires far fewer resources but has consequences far beyond those of conventional weapons.

There have been no nuclear weapons detonated with the express intention of destroying civilians since 1945. The stakes are high, and nobody wants to launch a nuclear attack unless it is in retaliation for a nuclear attack. But by then it's too late to save the millions killed by the initial attack.

We all hope deterrence works. But deterrence very nearly failed a number of times in the Cold War between the USSR and the US. Given the possibility that deterrence might fail–over-ridden by a commander with launch authority, or a dozen other possibilities of miscalculation or impulse– plans must be made for a first-strike designed to neutralize a nuclear missile capability.

The decision to launch nuclear weapons is political, not military – but achieving the goal is the duty of the military.

It's nothing personal, folks–it's just a peculiar business.

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Scaramucci Listed As Dead In Latest Harvard Alumni Directory

It was a bad day for Anthony Scaramucci: first the Mooch was fired just ten days after he was first hired, in the brief process getting served with divorce papers and missing the birth of his baby while unleashing a bizarre rant for the ages, and then shortly after, his now former boss, the president of the US, the same one who earlier said there was no chaos at the White House, tweeted that it was “A great day at the White House”

In this case, one of the responses to the Trump tweet was substantially more informative than the original:

And then, adding insult to pink slip, CBS reported that Harvard Law School apologized for erroneously listing Anthony Scaramucci as dead in its new alumni directory.

No, really: a directory mailed to alumni this week included an asterisk by the name of Scaramucci, a 1989 graduate of the Cambridge, Massachusetts, university, indicating he had died.

A statement from the law school apologizes for the error and says it will be corrected in future editions. It doesn’t provide an explanation for the error. The directory is published every five years and is available only to alumni of the Ivy League law school.

If there was any consolation for Scaramucci, it came from People Magazine, which reported that the lawyer representing the estranged wife of ousted White House communications director denied the NY Post report that the couple ended their marriage because of President Trump.

“I don’t know where that came from, but it is not accurate. It is a false fact,” divorce lawyer Jill Stone, who represents Deidre Ball, told People magazine on Monday.

So at least that wasn’t Trump’s fault. And now that he is once again out of the public eye, Scaramucci may finally get what he requested just 48 hours ago: a plea to leave his family out of it.

To top off an emotional day for all, here is some humor from The Onion:

Following his abrupt dismissal just 10 days after being named White House communications director, Anthony Scaramucci reportedly received an outpouring of sympathetic texts Monday from friends and family expressing that they were “so fuckin’ sorry to hear about this shit.”

 

“My deepest motherfuckin’ condolences, Tony, it’s terrible to hear you got shit-canned by these ass-munching cocks in D.C.,” read a text message in part, just one of dozens sent by old buddies at Goldman Sachs, current business partners at SkyBridge Capital, and extended family in New Jersey in response to his “goddamn bullshit” dismissal.

 

“Sorry to hear those bitches gave you the fucking ax, Mooch. That jackass [John] Kelly got no fucking clue what a good fuckin’ dude you are. Just know your mother and I always got your fucking back.” At press time, Scaramucci’s New York office was reportedly filled with flower arrangements and handwritten cards lamenting that this was “absolute fucking trash.”

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