With his company's stock in free fall, Overstock.com CEO Patrick Byrne resigned as CEO and from the company's board on Thursday, effective immediately, Bloomberg reports.
In a separate statement, Overstock named Jonathan Johnson, a board member and president of blockchain-focused subsidiary Medici Ventures, as interim CEO.
Byrne's resignation comes after conspiratorial comments where he confessed his role in the 'deep state', claiming that he helped cause "damage done to our nation for three years and felt my duty as a citizen precluded me from staying silent any longer." Byrne released an initial statement last week where he discussed his involvement in the federal government's investigation into the 2016 election interference, though he wasn't super-specific, he said he assisted in 'investigations' related to the Clintons and Russia.
Recently, Byrne turned over documents to the DoJ regarding what he said was 'the greatest political scandal in US history.'
“I gave to the DOJ documents concerning both the origin of the Russian probe and the probe into Hillary Clinton, both of which I was involved in, and both of which turned out to be less about law enforcement than they were about political espionage,” Byrne told SaraACarter.com Monday.
He also claimed in an interview with the NYT that he had been romantically involved with Maria Butina, the convicted Russian operative who had infiltrated the NRA.
Overstock shares have tumbled since Byrne's statement, though shares were halted pending news on Thursday.
The Dow has managed to levitate into the red following a Reuters report that sent the stock of Dow heavyweight Boeing higher, according to which Boeing told suppliers it will resume production of its best-selling 737 jets at a rate of 52 aircraft per month in February 2020, then stepping up to a record 57 jets monthly in June.
There is, of course a catch: the aerospace giant will only be able to boost production if the FAA clear the plane. To wit, Boeing told more than 100 suppliers during at least one Web meeting July 30 that the new schedule depended upon regulators approving the 737 MAX to fly again commercially in the fourth quarter.
Of course, since the entire report is contingent on the firm getting a greenlight, it is nothing more than a trial balloon, and also an attempt by Boeing to make the FAA responsible for the future wellbeing of Boeing shareholders. As Reuters notes, one of the sources "expressed skepticism over the timing given the intense scrutiny from regulators that grounded the 737 MAX after deadly crashes killed nearly 350 people in Ethiopia and Indonesia in the span of five months."
More to the point, there is no guarantee when regulators will clear the 737 MAX to fly again, and Boeing Chief Executive Dennis Muilenburg told analysts last month that Boeing would consider further 737 output cuts or potentially suspending production if the grounding dragged on.
In other words, Boeing production could be a record in Q2 2020... or it could be zero.
In April, Boeing cut the number of 737s it produces monthly to 42 from 52 after halting deliveries to airline customers, cutting off a key source of cash and hitting margins. Because the grounding happened when Boeing was going up towards record production levels, and each move of the sprawling supply chain has to be planned far in advance, Boeing and its suppliers are now caught between two conflicting pressures: preparing to get back on the upward path as soon as the plane is flying but also ratcheting downwards if regulators stall and the grounding continues for longer than expected.
Understandably, with no control over what the FAA decides (for once), Boeing has been tight-lipped about its production plans. CEO Muilenburg told analysts last month that Boeing expects to be able to maintain its current monthly production rate of 42 aircraft, "followed by incremental rate increases that would bring our production rate to 57 during 2020."
Two persons familiar with Boeing's production plans, who spoke to Reuters on condition of anonymity, said Boeing told suppliers it will increase production from 42 to 47 single-aisle aircraft per month in October, jibing with its guidance to investors on when it expects to win regulatory approval. It would then increase from 47 aircraft to the pre-crash rate of 52 aircraft per month in February 2020, the people, and a third person familiar with the plans, said. Boeing then would hit a record stride of 57 single-aisle jets per month in June 2020, two of the people said.
Again, all of this is contingent on FAA granting the company a green light to resume flights.
In response to questions from Reuters, Boeing spokesman Paul Bergman said Boeing updated the 737 master production schedule to reflect timing assumptions for the 737 MAX return to service plan. "While the assumption reflects Boeing's best estimate at this time, the actual timing of return to service will be determined by the FAA and other global aviation regulatory authorities and could differ from this assumption and estimate."
Also not surprisingly, algos completely missed the conditional nature of the report, and sent Boeing stock to session highs, which in turn helped move the Dow back from red on the day to well in the green.
Authored by Chris Metli, Head of US Quantitative and Derivative Strategies at Morgan Stanley
Economic data is deteriorating. Earnings growth is negative. Trade risks are high. But these facts are well known by the market.
There has been a massive flight to quality over the last year, and equally important, correlations between all of the long safety/short global growth trades is at historical highs. Crowded bearish positioning means that the asymmetry in equities is to the upside, even if the base case should be for more downside. A positive growth catalyst would be highly disruptive to portfolios for many types of investors, and playing for the unwind of ‘flight to quality’ is the most convex trade in the market today.
Defensive positioning both across asset classes and at the thematic long/short level within equities is extreme: Over the last year a net $550bn has moved out of equities and into bond and money market funds (larger than in 2016).
A net $80bn has moved out of cyclical and value ETFs and into defensive sector, high div, and low vol funds over the last year (dwarfing the safe haven bid seen in 2016).
The gap between Growth vs Value positioning for L/S Hedge Funds is the widest it’s been since at least 2010 and equity L/S HF net leverage is in the 11th percentile since 2010 per the MS PB Content Team...
... while gross leverage is in the 79th percentile – indicating that there are plenty of shorts that need to come off should views on global growth change. And factor valuation spreads are at extremes.
The defensive rotation started in 3Q18, and US Equity Strategist Mike Wilson has been recommending this trade since June 2018(1). But what really stands out in 2019 is the fact that correlations between the consensus flight to safety trades, both within equities and across asset classes, has increased to levels last seen in 2016 and 2008.
In 2007/8 flight to safety was the right trade, but in 2016 it was not. And in the event 2016 is the right playbook, as one trade comes off, they all could.
As MS Cross Asset Strategist Andrew Sheets notes(2), “If better growth data boost yields and steepen the yield curve, this could support a major rotation away from growth and quality towards value and lower-quality stocks. This is a rotation that active managers are generally positioned against.”
To be clear, we aren’t necessarily calling for this pro-growth rotation to happen – betting against current consensus positioning is convex for a reason: it’s a low probability event. And there’s good fundamental reasons for the flight to safety to continue: macro data is decelerating with global manufacturing PMIs moving further into contraction for the second consecutive month...
... and the Morgan Stanley Business Conditions Index moving down to 17 in August (~2008 levels), earnings revisions breadth remains negative, and trade risks remain high.
But there is a possibility (even if low probability) of a return to growth. The consumer remains strong and a surge in mortgage refis this year could potentially boost spending. Both the Empire and Philly Manufacturing surveys recently surprised to the upside, despite survey periods that covered the latest trade re-escalation.
And governments are floating fiscal stimulus ideas (why not when money is free?) – a 50bn Euro stimulus from Germany, payroll tax cuts in the US, and lifting the annual quota for local government special bonds in China to fund more infrastructure spending. And against this backdrop global central banks are easing financial conditions. While an improvement in growth could change that trajectory, investor sentiment and markets can turn faster than central banks can turn more hawkish.
Given the low probability but high potential convexity of a move, the best trade to position for or protect against a pro-growth rotation is to buy calls on the ‘unloved’ areas of the market: Cyclicals, Small Caps, EM, Value, etc.:
Notes: All pricing indicative
Larry Summers is not one to be shy about sharing his opinion on any and every media channel about just how bad President Trump's policies are, and how much better everything was in the world under President Obama.
However, in an epic thread of apparent honesty, the former director of the National Economic Council for President Obama took to Twitter to dispel any myths about the omnipotence of central planners and to confirm there's nothing anyone can do to save the world from doom (especially Jay Powell's speech tomorrow).
Mea Culpa? Or partisan political pandering to reinforce the "recession is imminent and there's nothing to stop it and it's Trump's fault and that means Trump's unelectable" narrative?
Summers begins his diatribe by addressing the big imminent issue ahead of us:
"Coming into Jackson Hole, economists are grappling with a major issue: Can central banking as we know it be the primary tool of macroeconomic stabilization in the industrial world over the next decade?"
Coming into Jackson Hole, economists are grappling with a major issue: Can central banking as we know it be the primary tool of macroeconomic stabilization in the industrial world over the next decade? In my forthcoming paper w/ @annastansbury, we argue that this is in doubt. 1/— Lawrence H. Summers (@LHSummers) August 22, 2019
His worry - they are running out of ammo and what ammo they have is losing its mojo...
There is little room for interest rate cuts. In every US recession since the 1970s, the fed funds rate was cut >500bps. In most, the real rate fell >400bps below the neutral rate. Now, the max. feasible cut is 200-300bps, bringing the real rate only 150-250bps below neutral. 2/ pic.twitter.com/6QfiaVykU7— Lawrence H. Summers (@LHSummers) August 22, 2019
This limited space for interest rate cuts is true of the US, which has the highest interest rates in the industrialized world. It is even more true of Europe and Japan. 3/
QE and forward guidance have been tried on a substantial scale. We are living in a post QE and forward guidance world. It is hard to believe that changing adverbs here and there or altering the timing of press conferences or the mode of presenting projections is consequential. 4/
Then, Summers goes after central planner over-confidence...
We usually agree w/ Janet Yellen, but believed at the time of her 2016 Jackson Hole speech -and believe even more in today’s world of 150bp 10yr rates- that her optimism about the existing monetary policy toolkit is misplaced. 5/https://t.co/Kg95Pnh65Qhttps://t.co/iqQqrDpIcY— Lawrence H. Summers (@LHSummers) August 22, 2019
Black hole monetary economics - interest rates stuck at zero with no real prospect of escape - is now the confident market expectation in Europe & Japan, with essentially zero or negative yields over a generation. The United States is only one recession away from joining them. 6/
Everywhere in the industrial world, the risks of a sharp upturn in unemployment appear greater than the risks of a sharp upturn in inflation (even though market expectations of inflation are clearly below 2 percent targets). 7/
The one thing that was taught as axiomatic to economics students around the world was that monetary authorities could over the long term create as much inflation as they wanted through monetary policy. This proposition is now very much in doubt. 8/
Many believe that events proved Alvin Hansen wrong about secular stagnation. On the contrary, the fact that it took WW2 to lift the world out of depression proves his point. Absent the military buildup, a liquidity trap deflation scenario would likely have persisted. 9/— Lawrence H. Summers (@LHSummers) August 22, 2019
Call it the black hole problem, secular stagnation, or Japanification, this set of issues should be what central banks are worrying about. 10/
We have come to agree w/ the point long stressed by Post Keynesian economists & recently emphasized by Palley that the role of specific frictions in economic fluctuations should be de-emphasized relative to a more fundamental lack of aggregate demand. 11/https://t.co/cyhGDDvAsM— Lawrence H. Summers (@LHSummers) August 22, 2019
In our forthcoming paper, we argue that it minimizes our predicament to see it – as is current consensus – simply in terms of a falling neutral rate, low inflation, and the effective lower bound on nominal rates. Secular stagnation is a more profound issue. 12/
Limited nominal GDP growth in the face of very low interest rates has been interpreted as evidence simply that the neutral rate has fallen substantially. There may well be more to it than that. 13/
We believe it is at least equally plausible that the impact of interest rates on aggregate demand has declined sharply, and that the marginal impact falls off as rates fall. 14/
And then Summers drops the real hammer - rate cuts are useless... or worse, are actually worsening the situation.
It is even plausible that in some cases interest rate cuts may reduce aggregate demand: because of target saving behavior, reversal rate effects on fin. intermediaries, option effects on irreversible investment, and the arithmetic effect of lower rates on gov’t deficits. 15/
This can be illustrated using a textbook macroeconomic diagram with a very steep, non-linear or even backward-bending IS curve. 16/ pic.twitter.com/MKLzEjTPHs— Lawrence H. Summers (@LHSummers) August 22, 2019
If the central problem for macroeconomic stabilization is a falling neutral real interest rate – what might be called “old new Keynesian” economics – monetary policy can achieve full employment if it can get the interest rate low enough. 17/
In contrast under the secular stagnation view we have outlined – what might be called “new old Keynesian” economics – interest rate cuts, even if feasible, may be at best only weakly effective at stimulating aggregate demand and at worst counterproductive. 18/
There is the further point that reducing interest rates may degrade future economic performance for any of the following reasons. 19/— Lawrence H. Summers (@LHSummers) August 22, 2019
First, financial instability. The financial crisis had roots in bubbles & excessive leverage caused by efforts to maintain demand after the 2001 recession. Japan’s late 1980s bubble had roots in a low interest rate tight fiscal environment after the 1987 stock market crash. 20/
Second, risks of zombification of firms. Firms that do not face debt service payments are like students who do not have to take tests. They can drift along complacently & ultimately unsuccessfully. And low rates may contribute to increased monopoly power and reduced dynamism. 21/
Third, risks of bank failures. Low rates crowd bank profits and franchise value, making them more vulnerable to adverse shocks at any given level of regulatory capital. 22/
Fourth, risks of further reducing monetary policy effectiveness. To the extent to which rate cuts now “borrow” demand from the future as firms and consumers bring forward investment and durable purchases, low rates now may imply less effective monetary policy in the future. 23/
Summers then goes further - blasting Central planners for claiming they can "contain" the issues...
The right issue for macroeconomists to be focused on is assuring adequate aggregate demand. We believe it is dangerous for central bankers to suggest that they have this challenge under control - or that with their current toolkit they will be able to get it under control. 24/— Lawrence H. Summers (@LHSummers) August 22, 2019
Obviously fiscal policy needs to be a major focus, especially given what low or negative interest rates mean for the sustainability of deficits. 25/
But the level of demand is also influenced by structural policies: e.g. pay-as-you-go social security, higher retirement ages, improved social insurance, support for private infrastructure investment, redistribution from the high-saving rich to the liquidity-constrained poor. 26/
The high inflation and high interest rates of the 1970s generated a revolution in macroeconomic thinking, policy and institutions. The low inflation, low interest rates and stagnation of the last decade has been longer and more serious and deserves at least an equal response. 27/
But at least he ends on an upbeat note ahead of Jay Powell's speech tomorrow...NOT!
We hope this will come out of Jackson Hole’s focus on “Challenges for Monetary Policy” - but we are not holding our breath. 28/— Lawrence H. Summers (@LHSummers) August 22, 2019
So, after that 28 tweet thread of self-flagellation, wouldn't it have been more interesting if Summers had said all that oh, ten years ago?
MOSCOW – Russia will always be in solidarity with Venezuela and intends to oppose pressure on Caracas, said Russian Foreign Minister Sergei Lavrov. During a meeting with Venezuelan Executive Vice President Delcy Rodríguez, Lavrov said Russia would always be committed to the principles of solidarity with Venezuela . “We will always be in solidarity with […]
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Last week a surprising report emerged from Reuters, namely that as part of its escalating capital controls, Chinese authorities have curbed private gold imports since May as the trade war escalated in a move that could be aimed at curbing outflows of dollars and bolstering its yuan.
According to sources, China's gold imports were down 300-500 tonnes, with around $15-$25 billion, since May, as the PBOC had for several months curtailed or not granted import quotas to commercial banks responsible for most of the gold that enters the country
Fast forward to today, when Reuters reports that China has partially lifted restrictions on imports of gold, according to bullion industry sources. According to the report, the central bank began to issue quotas again last week, but for lower amounts of gold than considered normal, "three people with direct knowledge of the matter in London and Asia said - without specifying exact amounts."
"Some (quotas) have been given,” said one of the sources, adding that these were “less than usual.” It’s a "partial lift" of the restrictions, another source said.
China has become a key swing driver in gold prices: it is now the world’s biggest importer of gold, with around 1,500 tonnes of metal worth some $60 billion - equivalent to one-third of the world’s total supply - entering the country last year. Chinese demand for gold jewelry, investment bars and coins has trebled in the last two decades as the country has rapidly become wealthier. China’s official gold reserves meanwhile rose fivefold to nearly 2,000 tonnes, according to official data.
The recent sharp move higher in gold coincided with the sharp escalation in the currency war between the US and China, prompting many to speculate that Chinese residents had been aggressively buying up the yellow metal, in the process adding further downward pressure on the yuan.
The last time Beijing took steps to curb capital outflows was when its currency weakened in the aftermath of the 2015 devaluation when the PBOC enforced restrictions on gold imports in 2016. The result was a surge in cryptocurrencies as Chinese savers took to the digital currency in lieu of gold purchases.
While no clear data for capital outflows exist, a measure from China’s balance of payments called errors and omissions points to $88 billion leaving in the first three months of this year, the most on record.
As we reported previously, Chinese customs figures showed the country imported 228 tonnes less gold in May and June - the last month for which data is available - than in the same two months of 2018. By mid-August, up to 500 tonnes less gold had entered China since May than over the same period last year, people in the bullion industry said.
Submitted by Nick Cunningham, of OilPrice
The U.S. could “drown the world in oil” over the next decade, which, according to Global Witness, would “spell disaster” for the world’s attempts to address climate change.
The U.S. is set to account for 61 percent of all new oil and gas production over the next decade. A recent report from this organization says that to avoid the worst effects of climate change, “we can’t afford to drill up any oil and gas from new fields anywhere in the world.” This, of course, would quickly cause a global deficit, as the world continues to consume around 100 million barrels per day (bpd) of oil.
Global Witness notes that the industry is not slowing down in the United States, notwithstanding recent spending cuts by independent and financially-strapped oil and gas firms. If anything, the consolidation in the Permian and other shale basins, increasingly led by the oil majors, ensures that drilling will continue at a steady pace for years to come.
It isn’t as if the rest of the world is slowing down either. The global oil industry is set to greenlight $123 billion worth of new offshore oil projects this year, nearly double the $69 billion that moved forward last year, according to Rystad Energy. In fact, while shale drilling has slowed a bit over the past year amid investor skepticism and poor financial returns, offshore projects have begun to pick up pace.
But that trend might turn out to be just a blip. The U.S. is still expected to account of the bulk of new drilling and the vast majority of new production, with much of that coming from shale. Already, the U.S. is the world’s largest producer of both oil and natural gas. And the pace has accelerated in recent years. In 2018, U.S. oil and gas production increased by 16 and 12 percent, respectively. According to the EIA, the U.S. surpassed Russia in terms of gas production in 2011, claiming the top spot, and it surpassed Saudi Arabia in oil production last year.
Going forward, new production from the U.S. will be eight times larger than the next largest source of growth, which is Canada. In fact, the U.S. will add 1.5 times more oil and gas than the rest of the world combined, according to Global Witness.
But because so much drilling in the U.S. is concentrated in a few areas, individual U.S. states on their own tower over the rest of the world. If Texas were a country, it would account for the most new oil and gas production in the world. Between 2020 and 2029, Texas could account for 28 percent of all additional output, Global Witness says.
Canada and Pennsylvania tie for second and third with 7 percent each. Then comes New Mexico at 5 percent of the growth and North Dakota at 4 percent. Oklahoma, Brazil, Colorado, Russia and Ohio are all tied at 3 percent a piece.
In other words, 7 out of the top 10 sources of new oil and gas production globally over the next decade are U.S. states.
“If things don’t change, by the end of the next decade, new oil and gas fields in the US will produce more than twice what Saudi Arabia produces today,” Global Witness said in its report.
This presents a massive challenge. “To avoid the worst impacts of climate change, our analysis shows that global oil and gas production needs to drop by 40% over the next decade. Yet, instead of declining, US oil and gas output is set to rise by 25% over this time, fueled by expansion in new fields,” the report warned.
One of the pillars of support that has helped propel European stocks higher in recent days was violently yanked this morning, when Bloomberg reported that Germany’s Bundesbank refuted repeated trial balloons by Spiegel, saying it doesn’t see a need for fiscal stimulus at this time, even though it expects the economy to shrink again this quarter.
While Germany's Finance Minister Olaf Scholz said it would be prudent to prepare measures that could be implemented if the outlook worsens, the economy currently doesn’t require additional support, the Bloomberg sources said, asking not to be identified revealing internal deliberations.
As Bloomberg adds, Bundesbank economists predicted that German output could fall 0.1% in the third quarter, the same contractionary pace as in the previous quarter, which would result in a technical recession.
As noted earlier, Germany’s economic contraction, highlighted earlier on Thursday by a continued slump in the country's manufacturing PMI, has prompted a wave of calls for the government to provide a fiscal boost.
Yet even with long-term borrowing costs below zero, the government - bizarrely reluctant to issue new debt "just because it can" and shocking economic "experts" around the world - has been reluctant to abandon its balanced-budget policy and jump into action. However, in a first sign that even Berling may be about to crack, Bloomberg reported earlier this week that it’s is preparing measures that could be triggered by a deep recession.
However, just like Trump, the German central bank refuses to accept the true extend of the economic slowdown, and instead experts there describe the state of the economy as one of protracted stagnation, with the performance over the past year skewed by a range of temporary factors. Mild winter weather, for example, bolstered output in the first quarter, with payback in the spring.
Still, unlike Trump, the Bundesbank admitted that its complacent assessment could be wrong, and in its monthly report published Monday, the central bank highlighted the difficulty predicting the current course of the economy, with manufacturing in a deep downturn and private consumption still solid.
"As things currently stand, it is unclear whether exports and, by extension, industry will regain their footing before the domestic economy becomes more severely affected,” the Bundesbank wrote according to Bloomberg.
The news, in conjunction with the earlier Harker-mediated TSY yield curve inversion, sent both European...
... and US stocks to session lows.
MOSCOW – The emergence of the export version of the 5th generation Russian Su-57 fighter will destroy the monopoly of the American F-35 Lightning II fighter on the world market, writes the Chinese portal Sohu. “Many countries opposing the United States will be able to buy 5th generation aircraft, and Americans will have to reflect […]
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Moments after yields tumbled across the curve following the first contractionary US Mfg PMI print in a decade, which sparked fears that a US recession has finally arrived bond traders were whipsawed by comments from (non-voting) Philly Fed president Patrick Harker, who in an interview with CNBC said that he doesn't see any need for further stimulus at the moment.
"We are roughly where neutral is," Harker added and noted that they saw the US-China trade dispute as an "economic headwind."
While "It’s hard to know exactly where neutral is" Harker said that "we’re roughly where neutral is right now. And I think we should stay here for a while and see how things play out."
Asked if he sees a case for further stimulus, Harker replied “No. Not right now... The labor markets are strong, inflation is moving up slowly — but with the last CPI print, it was a good print."
His unexpectedly hawkish comments echoed remarks from the Fed's Esther George who said it was not time for accommodation as the labor market remains strong.
Here are some other soundbites from his interview with Steve Liesman:
Supported by these hawkish remarks, the US Dollar Index rebounded from the session low that it set at 98.08 in the last hour and is now at 98.18, still losing 0.08% on the day.
But the biggest market reaction was the sharp spike in 2Y yields which rebounded from 1.555% to over 1.60% in the span of minutes following Harker's comments.
And with the 10Y not moving nearly as much, the 2s10s curve re-inverted sharply thanks to Harker's hawkish commentary...
... once again sparking concerns among stocks that a recession is imminent, and sending the S&P back in the red.
With all eyes focused squarely on Germany's dismal PMI prints, which have been in contraction for over half a year, the investing public forgot that the US economy is similarly slowing down. And moments ago it got a jarring reminder when Markit reported that the US manufacturing PMI unexpectedly tumbled into contraction territory, down from 50.4 last month, and badly missing expectations of a 50.5 rebound. This was the first print below the 50.0 expansion threshold for the first time since September 2009.
But wait, there's more, because whereas until now the US services segment appeared immune to the slowdown in US manufacturing, in August the service PMI tumbled to 50.9, down from 53.0 in July, matching the lowest print in at least 3 years, and well below the 52.8 consensus expectation. According to Markit, subdued demand conditions continued to act as a brake on growth, with the latest rise in new work the slowest since March 2016. This contributed to a decline in backlogs of work for the first time in 2019 to date.
Meanwhile, business expectations among service providers for the next 12 months eased in August and were the lowest since this index began nearly a decade ago.
As the report further notes, the decline in the headline PMI mainly reflected a much weaker contribution from new orders, which offset a stabilization in employment and fractionally faster output growth.
This however was offset by new business received by manufacturing companies, which fell for the second time in the past four months during August. Although only marginal, the latest downturn in order books was the sharpest for exactly 10 years. The data also signalled the fastest reduction in export sales since August 2009.
Survey respondents indicated that a drop in sales often cited a soft patch across the automotive sector, alongside a headwind to manufacturing exports from weaker global economic conditions. Meanwhile, manufacturing companies continued to trim their inventory levels in August, which was mainly linked to concerns about the demand outlook. Pre-production inventories fell for the fourth month running, while stocks of finished goods decreased to the greatest extent since June 2014 fastest reduction in export sales since August 2009.
Survey respondents indicated that a drop in sales often cited a soft patch across the automotive sector, alongside a headwind to manufacturing exports from weaker global economic conditions.
Commenting on the flash PMI data, Tim Moore, Economics Associate Director at IHS Markit said:
“August’s survey data provides a clear signal that economic growth has continued to soften in the third quarter. The PMIs for manufacturing and services remain much weaker than at the beginning of 2019 and collectively point to annualized GDP growth of around 1.5%.
“The most concerning aspect of the latest data is a slowdown in new business growth to its weakest in a decade, driven by a sharp loss of momentum across the service sector. Survey respondents commented on a headwind from subdued corporate spending as softer growth expectations at home and internationally encouraged tighter budget setting.
“Manufacturing companies continued to feel the impact of slowing global economic conditions, with new export sales falling at the fastest pace since August 2009.
“Business expectations for the year ahead became more gloomy in August and remain the lowest since comparable data were first available in 2012. The continued slide in corporate growth projections suggests that firms may exert greater caution in relation to spending, investment and staff hiring during the coming months.”
An interesting nuance as noted by Viraj Patel of Arkera, is that while German economic sentiment may be troughing (granting in very contractionary territory), it is now America's turn to slump into recession:
Interesting PMI day so far. Eurozone (Germany) beats... and US disappoints. Is relative tide changing? Lot of pessimism over Eurozone economy versus US Trump tax cut 'sugar high' + tariff war slowdown still very much in process with more room to go. $EURUSD cyclically higher now? pic.twitter.com/RsRZDZQuYS— Viraj Patel (@VPatelFX) August 22, 2019
A few days ago we reported that the easiest way for Trump to get the Fed to launch QE was to i) start a global economic war or ii) send the US economy into recession. Based on today's data, Trump is making great progress on the latter, and we are confident the former can't be far behind.
While President Trump continues to tout the strength of the US economy - and take credit for it, he is no doubt keenly aware that a recession before the 2020 election would put a dent in his chances for reelection.
To that end, a new poll by Morning Consult found that 42% of Trump voters would hold him at least partially responsible for an economic downturn, while 7% say it would be all his fault. Meanwhile, the poll revealed that Trump has a 48% approval rating on the economy.
Perhaps that's why he's continued to push for rate cuts and tax cuts; an attempt to avoid the economic chaos which liberal HBO host Bill Maher is praying for in the hopes of ushering in a Democratic president in the next election.
Still, Trump appears confident that the wheels won't fall off the economy anytime soon.
"I don’t think we're having a recession," he said on Sunday. "We're doing tremendously well."
That said, Trump also floated an idea during Oval Office comments this week that he may temporarily cut payroll taxes to temporarily boost the economy, while also slamming the Federal Reserve for abdicating its duties by not approving a large interest rate cut.
"So Germany is paying Zero interest and is actually being paid to borrow money, while the U.S., a far stronger and more important credit, is paying interest and just stopped (I hope!) Quantitative Tightening," he tweeted on Wednesday.
So Germany is paying Zero interest and is actually being paid to borrow money, while the U.S., a far stronger and more important credit, is paying interest and just stopped (I hope!) Quantitative Tightening. Strongest Dollar in History, very tough on exports. No Inflation!.....— Donald J. Trump (@realDonaldTrump) August 21, 2019
Meanwhile, as Morning Consult notes, "Data is starting to pile up that an economic downturn could be coming sooner rather than later. Economists surveyed by the National Association for Business Economics expect a recession in 2020 or 2021."
PYONGYANG – On Wednesday, Venezuela opened its embassy in North Korea in Pyongyang, according to the Central Telegraph Agency of Korea. Although the event has just happened now, the two countries have had diplomatic relations since 1974. According to information from the North Korean Agency, the opening ceremony of the embassy was attended by North […]
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We have never seen anything quite like this.
This week the skies above Brazil’s largest city turned black in the middle of the afternoon due to the massive wildfires that are currently raging in that country. But the wildfires aren’t actually happening anywhere near São Paulo. In fact, the smoke that turned the skies black actually came from fires that were happening more than 1,000 miles away. Can you imagine how powerful the fires have to be in order to do that?
And it isn’t just Brazil – right now horrific fires are scorching vast stretches of our planet from South America all the way up to the Arctic. Some of the fires are producing so much smoke that you can actually see it from space. And in the process, irreversible damage is being done to our ecosystems.
I know that this number is hard to believe, but there have been more than 72,000 wildfires in Brazil so far in 2019, and most of those fires are happening in the Amazon rainforest. I understand that many of you may not care what happens in Brazil, but you should. Approximately 60 percent of the entire Amazon rainforest is in Brazilian territory, and that rainforest produces approximately 20 percent of all the oxygen in our atmosphere. So essentially the “lungs of the Earth” are being burned away right in front of our eyes…
The fires are burning at the highest rate since the country’s space research center, the National Institute for Space Research (known by the abbreviation INPE), began tracking them in 2013, the center said Tuesday.
There have been 72,843 fires in Brazil this year, with more than half in the Amazon region, INPE said. That’s more than an 80% increase compared with the same period last year.
The Amazon is often referred to as the planet’s lungs, producing 20% of the oxygen in the Earth’s atmosphere.
Every minute of every single day, an average of 1½ soccer fields of Amazon rainforest are being wiped out. This is an ongoing crisis that hasn’t been getting nearly the attention that it deserves in the United States.
You will find more infographics at Statista
But when the skies above Sao Paulo suddenly turned completely black at three in the afternoon on Monday, that set off a social media frenzy…
São Paulo’s skies were blackened for roughly an hour at around 3 p.m. Monday due to raging fires throughout the region and weather conditions that pushed particulate matter over the city, setting off intense speculation on social networks about the reason why the day was seemingly transformed into night.
Videos and images posted by local residents depicted disturbing scenes of pedestrians walking under black skies and cars driving in the mid-afternoon with their headlights on as the continued fires throughout the Amazon rainforest drove the hashtags #PrayforAmazonia and #PrayforAmazonas to worldwide viral status.
Sadly, these fires are not going to end any time soon. It is being reported that more than 9,000 fires are raging at the moment, and it is being estimated that 640 million acres have been affected by those fires.
Yes, you read that number correctly.
640 million acres.
Multiple fires are burning near the state’s biggest city, and firefighters have called in assistance from the Lower 48. More than 400,000 acres are currently burning, and one of the biggest concerns is the McKinley Fire, which has destroyed at least 50 structures about 100 miles north of Anchorage. Officials with the Matanuska-Susitna Borough declared a state of emergency, and firefighters hoped that calmer weather predicted for Wednesday could permit evacuees to return.
When I think of Alaska, I think of a place that is bitterly cold. But apparently it is hot enough this year for wildfires to sweep across hundreds of thousands of acres.
And we are also witnessing highly unusual wildfires in the Arctic in 2019…
The Arctic as a whole has seen unusually high wildfire activity this summer, Parrington said, including areas such as Greenland that typically don’t see fires. One estimate found that the amount of carbon dioxide emitted from fires burning within the Arctic Circle in in June 2019 was greater than all of the CO2 released in the same month from 2010 through to 2018 put together.
To me, it is very strange to be talking about “wildfires in the Arctic”, but we have entered a period of time when our entire definition of “normal” is going to change. Last winter we experienced one of the coldest winters in ages, during the first half of this year the middle of the U.S. experienced unprecedented rainfall and flooding, and now we are being told that last month was the hottest July ever recorded…
The average global temperature in July was 1.71 degrees F above the 20th-century average of 60.4 degrees, making it the hottest July in the 140-year record, according to scientists at NOAA’s National Centers for Environmental Information.
The previous hottest month on record was July 2016. Nine of the 10 hottest recorded Julys have occurred since 2005; the last five years have ranked as the five hottest. Last month was also the 43rd consecutive July and 415th consecutive month with above-average global temperatures.
Unfortunately, many believe that this is just the beginning. Global weather patterns are going haywire, and so the extremes that we have seen so far may just be the tip of the iceberg.
The environment that we depend upon for life every moment of every day is being shaken, and many are deeply alarmed about what is happening to the Earth. Each day it is being destroyed a little bit more, and the clock is ticking…
There was some good and some not so good news in today's German PMI data.
First, the good: the composite PMI rose 0.5pt to 51.4, beating expectations of another decline, and led by modest gains in the manufacturing output subcomponent even as the services PMI showed a marginal decline.
However, the underlying indices were more subdued, with new orders and employment falling more. The press release also noted a sharp fall in business expectations in the services sector. Backlogs of work across both sectors fell for a 10th month and the pace of hiring slowed, with employment in manufacturing declining at the fastest pace in seven years.
Perhaps more concerning was the outlook, which is now outright recessionary as for the first time since 2014, more companies now expect output to fall than rise over the next 12 months.
The problem for Germany is that with its manufacturing sector contracting at a dismal rate, Europe's most powerful economy has no buffer left - as a reminder, last week we learned that the economy shrank in the second quarter and real-time sentiment indicators confirm that another contraction in Q3 is virtually inevitable, guaranteeing a technical recession.
The persistent German weakness, driven in particular by mounting global trade tensions, car industry woes and slowing demand in China, certainly doesn’t bode well for the broader euro area. The silver lining: whereas European manufacturing is now screaming recession, at least services remain well in expansionary territory. However, with the spread now at all time highs, it is only a matter of time before services tumble.
Indeed, while the headline German composite PMI unexpectedly rebounded modestly in August to 51.4 from 50.9, the manufacturing index remained far below 50, signaling a seventh month of contraction.
Meanwhile, analysts continue to clamor for Merkel to do something besides lip service to the coming recession, and unleash fiscal stimulus: "Somehow they are not looking at this data," said ING economist Carsten Brzeski. "The German government should react. We have this stagnation of the entire economy now and we really need some fiscal stimulus."
Well, the German government said it will react - we just need a deep recession first, and one is clearly approaching right on schedule. One reason Germany may ignore the issue is because the ECB is already "on top" of it, with the central bank widely expected to add monetary stimulus as soon as next month by cutting rates and/or restarting QE.
Commenting on the latest dismal data out of German, Bloomberg's chief European economist showed a trace of optimis, saying "there’s a little light at the end of the tunnel for Germany’s economy. The PMI -- a trusted gauge of economic activity -- picked up a little in August. The big risk is that a fresh blow to manufacturing materializes -- the U.S. goes ahead with tariffs on EU car exports, for example -- or that weakness in the industrial sector spreads to services."
Others, however, were far more pessimistic: "Germany remains a two-speed economy, with ongoing growth of services just about compensating for the sustained weakness in manufacturing,” according to Markit's Phil Smith. "Although improving slightly, the survey’s output data haven’t changed enough to dispel the threat of another slight contraction in gross domestic product in the third quarter."
BAIKNOUR, Kazakhstan – Russian humanoid robot Fyodor was successfully launched into space inside the Soyuz MS-14 vehicle on the Soyuz-2.1a rocket of Kazakhstan’s Baikonur cosmodrome on Thursday. The rocket took off at 06:38 Moscow time as planned. During the release, as shown in a Russian agency Roscosmos webcast, Fyodor said the legendary “Come on!” immortalized […]
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Authored by Richard Breslow via Bloomberg,
The European PMIs that were released earlier today beat forecasts. And it felt positively quaint when the euro and bund yields rose to their respective highs of the day. If that is all it takes to change the mood, then economists should be enlisted to keep low-balling any economic estimates. Algorithms can be forgiven for reacting to the prints. No human trader should have been doing anything else besides fading the move for better intraday trade location.
That’s harsh. But it reflects two realities.
The market fully expects central banks to be dovish.
And the market is relying on that fact for its investing thesis.
Yet deep down inside, investors worry, probably even know, that further monetary policy stimulus will be of dubious value in actually getting the global economy moving at a quicker pace. Expensive money is not what ails us.
Trading volumes remain, understandably, very low. Earlier in the week, that didn’t mean there weren’t things to be learned from the price action. Whatever today brings should probably be taken with a little bit more wariness. Traders have a tendency to talk themselves into all sorts of notions when the event they have been preparing for suddenly looms.
A few days ago, everyone was sure exactly what Fed Chairman Jerome Powell was going to say and what the central banks were going to do. Today will be about traders torturing themselves by questioning those assumptions. Whether they have been right or wrong in formulating their expectations, nothing in Wednesday’s Fed minutes nor this morning’s PMIs will change what ends up happening in September.
Having said that, the short end of the Treasury curve is probably right in being just a little bit more circumspect about pricing beyond next month. Emphasis on the word “just.” There has been a lot built into expectations that go well beyond data-dependence. And there are plenty of domestic and international challenges that are very much known unknowns. Some of which, it would seem, can change on a whim or political expediency.
Whatever path markets take to get there, they have confidently assumed that the central banks are very focused on asset prices and will try to maintain their buoyancy. That will get harder to accomplish over time. But timing is everything.
The euro is the most interesting currency trade of the day. It needs to start holding up for more than short bursts of time or risks taking a new look at year-to-date lows. I guess it will wait until after the G-7 to decide what it is going to do. But it is really just hanging on. It seems even more in play than the dollar, which refuses to break out higher but also doesn’t back off. It’s becoming a frustrating exercise to trade. The yen is also worth keeping a close eye on. It’s hard to find anyone who isn’t bullish on it, which raises the question, why isn’t USD/JPY lower? Maybe it, rather than the euro, will decide which way the dollar indexes end up going.
If looking for a canary in the coal mine, given all of the interest-rate assumptions that current market pricing is based on, watch gold.
It keeps looking longingly at its support zone, which isn’t something one would normally expect with everything else going on.
DONBASS – “I can’t handle it anymore. My whole body is worn out. It’s worn out so much, that if I hear any sound, my body is all shaking. It’s the fear. We are living in fear and we don’t know when will it end.” – tells through tears Vera Vasilievna. She can’t even hide […]
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VIDEO: Elderly have nowhere to hide from Ukrainian shells - Fort Russ
DONBASS - "I can't handle it anymore. My whole body is worn out. It's worn out so much, that if I hear any sound, my body is all shaking. It's the fear. We are living in fear and we don't know when will it end." - tells through tears Vera Vasilievna. She can't even hide from shelling any more: her h
Most Americans could be forgiven for thinking that the 'trade war' is really only impacting the US and (maybe) China. After all, it was President Trump's belligerent rhetoric about holding China accountable that helped him win in 2016 in the first place. But what is less known, is that Trump's angry trade rhetoric aggravated a bunch of other longstanding trade spats, most notably, the now-emergent trade spat between Japan and South Korea, which is threatening to seriously disrupt trade throughout the Pacific Rim region.
Now, according to the Nikkei Asian Review, in the latest sign of how the relationship between the two countries has deteriorated, South Korea has decided not to extend an intelligence-sharing agreement with Japan.
The decision was reportedly made at a National Security Council meeting on Thursday at South Korea's "Blue House." South Korea said it no longer believes the agreement is "in its national interest" after Japan excluded South Korea from the "so-called" "White Countries' list".
Kim Yu-keun, the National Security Office's deputy director, said: "We thought that it is not in our national interest to maintain the agreement," adding that, "We will inform the Japanese government through diplomatic channels by the deadline of the extension, according to the agreement."
Kim said: "The government estimated that the Japanese government caused a critical change in the circumstances of security cooperation between the two countries by excluding our country from the so-called white countries' list...with no clear evidence, on Aug. 2."
For the record, that 'white countries' list? It's not what it sounds like.
The timing of the pact's termination is also interesting because of North Korea resuming its short-range missile tests, as well as its threats to call off peace talks with the South and the US.
Yoshihide Suga, Japan's chief cabinet secretary, late last month said that Tokyo wanted to maintain the pact, known as the General Security of Military Information Agreement.
The neighbors signed the agreement in 2016 out of a desire to cooperate in the face of an increasing threat from North Korea. The agreement stipulates how the countries can share military intelligence.
SK's decision not to extend the pact follows a meeting between the two countries foreign ministers in Beijing, where South Korean Foreign Minister Kang Kyung-wha demanded that Japan rescind its decision.
The decision came one day after South Korean Foreign Minister Kang Kyung-wha met with her Japanese counterpart, Taro Kono, in Beijing. South Korea's foreign ministry said Kang had expressed regret in regard to Japanese Prime Minister Shinzo Abe's decision to exclude South Korea from its "whitelist" of trusted trading partners earlier this month. She urged Tokyo to withdraw the decision that makes it more cumbersome for South Korean companies to import certain materials from Japan.
Unsurprisingly (since NAR is a Tokyo-based business newspaper), most of the analysts quoted in the piece seem to think South Korea's decision is a bad idea.
Analysts say Seoul should be careful about escalating the feud to include the intelligence agreement, which benefits both countries.
"We had better keep the agreement," Lee Su-hoon, a professor at Kyungnam University and a former ambassador to Japan, said at a forum. "We need military information. However, sharing high-class information should be based on trust."
Leif-Eric Easley, a professor at Ewha University in Seoul said in the report: "The Moon government may see this decision as domestically popular and as a symbolic, low-cost way of signaling resolve to Tokyo. However, this move will raise international concerns that Seoul misreads the regional security situation and is presently unwilling to shoulder its responsibility for improving Korea-Japan relations."
The relationship between the two countries has been deteriorating since even before a South Korean court ruled that Japanese companies must pay reparations to Koreans forced to work in Japan during WWII, which Japan has claimed goes against a treaty signed in 1965, that supposedly settled the issue of war reparations.
Elon Musk may have finally secured some of that precious financing he once claimed to have secured (roughly one year ago), though, according to a report in German business magazine Manager, things didn't turn out quite like he had hoped.
Per the magazine, Tesla is getting ready for a takeover, perhaps by Volkswagen, as carmakers scramble to roll out rival electric cars.
Of course, given Musk's track record, it's important to take this news with a grain of salt, given Musk's history of self-serving leaking and (at times) outright lies - but Tesla shares are ripping higher in the premarket.
As investors lose confidence in the company, Tesla is reportedly facing up to the fact that a takeover is probably its best option, with reports indicating that Volkswagen is interested. Though, as the report noted, it might be difficult to win approval for the merger from the Porsche family.
Street Insider called the rumor "very speculative"...
...and the rest of Twitter's immediate reaction was - err, skeptical - to say the least.
Lol. This German Manager article gunning $tsla pre-mkt on “takeover” 1)talks about German interest only after $tsla has failed, 2) has no sources, and 3) falsely says Germans were competing for Maxwell, which is wholly absent from background to the merger & wrong.— luis carruthers (@orthereaboot) August 22, 2019
Par for pump.
At this point I doubt VW would even want to buy $TSLA out of BANKRUPTCY. Too many liabilities, too much shitty engineering, and VW is too far along in its OWN EV programs.— Mark B. Spiegel (@markbspiegel) August 22, 2019
By Vladimir Gujanicic – Some of the first things that we think of if reminiscing the World War I are incessant trench warfare systems, positional systems, the battle fronts mainly static, and if they do progress, it is done with tremendous losses but small portions of territory gained. The fear of positional war systems and the […]
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US equity futures drifted lower, tracking European and Asian stocks in the red as uncertainty over the outlook for interest rate cuts following the release of the FOMC minutes kept investors on edge, while few traders were willing to trade in size with the Jackson Hole meeting set to begin. The yen and dollar jumped as the euro dropped and the yuan tumbled, while Treasuries edged higher with oil, while gold dipped.
The euro and German yields initially nudged initially higher after better-than-expected PMI readings in the euro area helped offset some fears of an imminent European recession. The moves were modest, however, and gains quickly faded as the manufacturing readings remain challenging (especially in Germany).
Some details on the latest PMI report from Goldman:
As a result, after the glow faded from euro-area PMIs, investors again sought safer assets, pushing Treasuries higher while the yen hit a fresh daily high amid a flight to safe havens. The moves came after South Korea said it would withdraw from an intelligence-sharing agreement with Japan and a senior EU official says discussions with U.K. Prime Minister Boris Johnson suggest a no-deal Brexit is likely. Italy’s FTSE MIB (+0.4%) was kept afloat as Italian President Mattarella holds a barrage of talks with party leaders in search of a coalition to fill the country’s political void in order to pass the 2020 budget later this year. Meanwhile, UK’s FTSE 100 (-0.5%) marginally lags its peers as heavyweight tobacco stocks (Imperial Brands -1.0%, British American Tobacco -1.4%) weigh on the index amid news that the US House Energy and Commerce Committee launched a probe into four e-cigarette companies, British American Tobacco, Atria Group (MO), Japan Tobacco (2914 JT) and Reynolds American; seeking information on Cos’ research into public heath impacts, marketing practices and promotion of e-cigarette use by adolescents.
As a result, Europe's STOXX 600 index fell 0.1% in choppy trade, following a 0.5% drop in MSCI’s broadest index of Asia-Pacific shares outside Japan. The MSCI world equity index was down 0.1%.
Earlier in the session, Asian stocks dropped for a second day, led by energy and utility firms, as traders awaited a Friday address by Federal Reserve Chairman Jerome Powell. Markets in the region were mixed, with India retreating and Malaysia climbing. The Topix closed little changed, as chemical producers advanced and electronic companies slipped. The Shanghai Composite Index edged up 0.1%, supported by Kweichow Moutai Co. and China International Travel Service Corp. The Hang Seng Index fell 0.8%, with Hong Kong-listed stocks facing their worst earnings decline since 2008. India’s Sensex fell for a third day, dragged down by Reliance Industries Ltd. and HDFC Bank Ltd. The country needs a “significant” fiscal package, a gradual decline in the rupee and more liquidity for the shadow-banking system to ease tight financial conditions, according to Bank of America Merrill Lynch.
While it didn't impact markets on Wednesday, when US equities posted notable gains, minutes of the Fed’s July meeting showed deep splits among policymakers over whether to cut interest rates last month, though there was some unity in wanting to signal it was not on a preset path to looser policy. The Fed cut rates by 0.25% in July. While a “couple” of Fed members supported a deeper cut of half a percentage point, “several” favored no change at all. That reluctance to loosen policy seems at odds with the expectations for a cut of over 100 basis points by the end of 2020 that are already priced into markets.
Strategists said that the minutes reflected a dissonance between expectations for cuts - fueled by geopolitical concerns such as U.S.-China trade tensions and economic weakness in major economies such as Germany - and the apparently solid fundamentals of the U.S. economy.
“The update last night was a bit of a reality check - maybe don’t get ahead of yourself on what the Fed is going to do,” said David Madden, market analyst at CMC Markets. “If you forget about the geopolitical headlines, forget about what the bond markets are doing, and look at the underlying indicators of the U.S. ... people are in jobs, earning decent money, and more importantly spending money.”
But beyond the United States, worries about the fragility of the global economy were evident in data from Europe on Thursday. Germany’s private sector continued to struggle in August, suggesting further that Europe’s largest economy is heading for a recession after its economy shrunk between April-June. Euro zone business growth expectations also fell to their weakest in more than six years on trade war fears, even as the expansion picked up a touch in August.
In FX, the slump in the yuan dragged it to an 11-year low, which also sapped appetite for risk, with dealers saying state-owned banks were seen selling dollars to support the yuan.
The Fed minutes also raised the stakes for Chairman Jerome Powell’s speech on Friday at the Fed’s annual policy retreat in Jackson Hole, Wyoming - an event that investors are waiting for with bated breath hoping for some clarity on the Fed's intentions. U.S. President Donald Trump has been urging larger rate reductions, with proponents of looser policy pointing to the need to lift inflation toward the Fed’s target and thwart fallout from global trade tensions. And those trade worries played out again in currency markets, where the fall in onshore China’s yuan to 7.0752 per dollar, its lowest since March 2008, promoted a rush to perceived safe-haven assets such as the Japanese yen. The yen advanced by 0.2% to 106.41 yen, nearing last week’s eight-month low of 105.05 yen. The euro slipped to a daily lows as commodity and Scandinavian currencies deepened losses.
Currency traders said that while the Chinese economy’s slowing growth meant pressure had been building on the renminbi from long before, the new fall suggested Beijing was prepared to use the currency as leverage as trade tensions simmer.
“This indicates that this is an instrument of the Chinese government in the trade war. It is allowing for renminbi weaknesses,” said Thu Lan Nguyen, FX strategist with Commerzbank in Frankfurt. “It is an indication that they are expecting the trade war to continue, to last longer than they anticipated last year.”
In geopolitics, North Korea carried out live fire drills by bombing replicas of South Korea's F-15K fighter jets, surface to air missiles and a radar. Across the border, South Korea stated they will not be renewing their intelligence accord with Japan, according to the Blue House. Iran displayed a new locally built mobile missile defence system, reported via Iranian news agencies. Iranian Foreign Minister Zarif says he is prepared to work on France's proposals regarding a nuclear deal.
In commodities, oil prices dipped on worries about the global economy and bigger-than-expected buildups in oil product inventories in the United States, the world’s biggest oil consumer. Brent crude futures rose 0.3%, or 18 cents, to $60.48, while U.S. crude gained 23 cents to $55.91 a barrel.
Expected data include jobless claims and PMIs. Gap, Intuit, Salesforce, and VMware are among companies reporting earnings.
Top Overnight News
Asian equity markets traded mixed as the region failed to sustain the early momentum from Wall St where sentiment was underpinned by strong retailer earnings and after the FOMC minutes did little to alter the landscape as they showed a divide among officials on rate cuts. ASX 200 (+0.3%) and Nikkei 225 (U/C) were both higher at the open with tech and energy the outperformers on the busiest day of the earnings season in Australia, while Tokyo trade was less decisive as price action eventually reflected a choppy currency and after a lack of progress in talks between Japanese and South Korean Foreign Ministers to resolve the ongoing spat. Hang Seng (-0.8%) and Shanghai Comp. (+0.1%) were subdued amid CNY weakness and as Hong Kong’s property sector suffered the brunt of the Hong Kong protests with developers said to be reducing prices to support sales, although losses in the mainland have been cushioned by the PBoC’s liquidity efforts. Finally, 10yr JGBs were initially unchanged amid similar uneventful trade in T-notes, but later saw mild support after firmer demand at the enhanced liquidity auction for long end JGBs and as risk tone began to deteriorate.
Top Asian News
European stocks have given up the earlier PMI-induced gains [Eurostoxx 50 -0.1%] as the sentiment seen from firmer EZ metrics across the board failed to persist, and amid little follow-through from FOMC Minutes. Italy’s FTSE MIB (+0.4%) is kept afloat as Italian President Mattarella holds a barrage of talks with party leaders in search of a coalition to fill the country’s political void in order to pass the 2020 budget later this year. Meanwhile, UK’s FTSE 100 (-0.5%) marginally lags its peers as heavyweight tobacco stocks (Imperial Brands -1.0%, British American Tobacco -1.4%) weigh on the index amid news that the US House Energy and Commerce Committee launched a probe into four e-cigarette companies, British American Tobacco, Atria Group (MO), Japan Tobacco (2914 JT) and Reynolds American; seeking information on Cos’ research into public heath impacts, marketing practices and promotion of e-cigarette use by adolescents. Moreover, broker downgrades for BHP (-1.7%), Anglo American (-2.0%) and Rio Tinto (-0.4%) adds further pressure on the index. Sectors are almost all in the red with cyclical stocks faring worse than defensives, in-fitting with the current risk tone. In terms of individual movers, Thyssenkrupp (+5.4%) shares jumped to the top of the Stoxx 600 amid reports that parties interested in Co's elevator unit include Advent, Apollo, CVC, Carlyle, KKR and possibly EQT, according to Manager Magazin. Meanwhile, BBVA (+1.3%) and Caixabank (+1.7%) benefit from broker upgrades at HSBC
Top European News
In FX, the euro was Not the strongest G10 currency, but the Euro perked up in wake of the flash Eurozone PMI surveys that were firmer than forecast across the board. Eur/Usd started to climb after the French preliminary prints and then crossed 1.1100 and beyond when German and pan headlines maintained the recovery trend, but faded again before testing offers reportedly waiting at 1.1120. Note also, hefty option expiries between 1.1095 and the big figure may be exerting a gravitational pull given 1.65 bn rolling off at the NY cut.
In commodities, WTI and Brent futures are modestly firmer on the day with the former around the 56/bbl mark, whilst the latter remains near the 60.50/bbl level having found a base at 60/bbl. News flow has been light thus far for the complex with price action likely to be dictated by macro developments/sentiment heading into Fed Chair Powell’s speech tomorrow. Meanwhile, the WTI/Brent Arb widened to around USD 4.60/bbl vs. USD 3.60 earlier in the week. ING notes that “it does appear that the relative strength in WTI is starting to raise concerns over how it may impact demand for US oil from overseas buyers”. Elsewhere, gold is marginally softer and pivots on either side of 1500/oz ahead of ECB Minutes and as the Jackson Hole Symposium goes on underway, with Fed Chair Powell due to speak tomorrow. Copper prices declined further below the 2.6/lb mark as risk appetite somewhat waned.
US Event Calendar
DB's Craig Nicol concludes the overnight wrap
So there we have it, another one of those ‘where were you when…’ moments in the era of crazy low bond yields with the world’s first-ever zero coupon 30-year bond issued yesterday. Indeed, the 30y Bund ended up pricing at -0.11%; however, the big talking point was the anaemic demand at the auction with less than half of the offering being taken up by investors, meaning the Bundesbank had to retain the balance. The real subscription rate as a result was just 0.43x, which compares with 0.86x at the July auction. A lot was made of this being a very weak auction although it’s still hard to ignore the fact that €824m of the negative yielding ultra-long bonds were taken up by investors.
That auction came on a day when bond markets were a bit weaker. The whole Bund curve is still negative; however, yields were up a couple of basis points while Treasury yields also closed higher after the release of the FOMC minutes. Two-year yields rose +6.3bps, while 10-year yields rose +3.4bps.That sent the curve back down to just 1.0bp - a level it’s holding this morning – and dangerously close to inversion again.
The most immediately-relevant takeaway from the minutes was that there is minimal support for a 50bps cut in September, and markets moved to price in only a 12% chance of the bigger cut. That’s down from 20% before the minutes and from as high as 50% last week, though a 25bps cut remains fully priced. The minutes also suggested that policymakers were attentive to the trade war risks and were not caught off guard by the recent escalation, saying that “participants were mindful that trade tensions were far from settled.” As for the Fed’s longer-term policy review, there were several indications that the discussions are accelerating, as policymakers reportedly discussed using QE “more aggressively” and also analyzed “makeup strategies.” The latter “could be designed to promote a 2 percent inflation rate, on average, over some period,” which would have dovish implications for rates. While we’re on the Fed, President Trump continued his relentless attack on twitter, calling Powell “a golfer who can’t putt, has no touch”. To be fair, the same could be said for 99% of amateur golfers.
The moves in bond markets reflected a generally more upbeat tone across markets more broadly. That was certainly the case in equities where last night the S&P 500 closed +0.82%. The NASDAQ and DOW also finished +0.90% and +0.93%, respectively, with cyclical sectors generally leading gains. Favourably-viewed corporate earnings results in the retail sector from Target (+20.55%) and Lowe’s (+10.35%) helped. Nevertheless, the reality is that equities have just chopped around in a range since the plunge early in August and sit roughly where they were two weeks ago. HY credit spreads also had a strong day, with cash spreads trading -11bps and -10bps tighter in the US and Europe, respectively.
Overnight, Asian markets are quickly losing momentum although it’s not entirely obvious what’s driving the reversal from the highs. The Nikkei (-0.04%), Hang Seng (-0.87%), Shanghai Comp (-0.18%) and Kospi (-0.38%) are all lower having opened with decent gains. Futures on the S&P 500 (-0.03%) are also back to flat as we go to print.
Moving on. While markets have had very little to feed on the way of economic data this week, the good news is that we’ve got the global flash August PMIs today, which will give us a fresh opportunity to test the global growth pulse. We’ve already had the data out in Japan this morning where the composite rose half a point to 51.7, helped by a 1.6pt increase in the services reading to 53.4 while the manufacturing reading remained in contractionary territory at 49.5, albeit up 0.1pt from July. We’ll get the data for France, Germany and the Euro Area shortly and the consensus expects the composite reading for the Euro Area to have deteriorated slightly from 51.5 to 51.2, with the manufacturing and services readings expected to print at 46.2 and 53.0, respectively. A reminder that the July numbers confirmed a reversal of the improvement seen in June with the composite reading roughly consistent with a low +0.2% qoq rate of growth. This data of course will be the single biggest growth data point ahead of the ECB meeting in 3 weeks’ time. We should note that we’ll also get the data in the US where expectations are for a 50.5 manufacturing and 52.8 services print.
In other news, Italian assets continue to perform well despite persistent political uncertainty. Prime Minister Conte is scheduled to meet with leaders from the League and Five Star today, to see if he can find a prospective government and avoid fresh elections. Italian assets outperformed their European counterparts yesterday with the FTSE MIB finishing +1.77% versus +1.21% for the STOXX 600 while BTPs rallied -4.0bps and now sit at the lowest since October 2016.
Elsewhere, the CBO updated their US economic and budget forecasts. They now expect the fiscal deficit to widen to $960bn this year, up from their prior estimate of $896bn from May. That will be worth around 4.5% of GDP, worse than their prior forecast for 3.9%. The worse outlook will also result in trillion-dollar deficits beginning in 2020, two years earlier than before. On the bright side, the CBO raised their 2020 GDP growth forecast by 0.4pp to 2.1%, though they left 2019 at 2.3%.
Finally, the economic data didn’t add much but for completeness, US existing home sales rose to 5.42mn for July, marginally beating expectations for 5.40mn. That took the trend to 2.5% mom, and the prior month was revised upward slightly. Mortgage applications, a more forward-looking metric, fell -0.9%.
Looking at the day ahead now, outside of the PMIs the other data scheduled for release is August CBI survey data in the UK and August consumer confidence data for Euro Area, before jobless claims, July leading index and August Kansas Fed manufacturing survey is released in the US. We’ll also get the ECB minutes and of course the Fed’s Jackson Hole symposium kicks off tonight but with Powell not due to speak until tomorrow.
TEHRAN – On the morning of Thursday Iran presented its new air defense system Bavar-373, considered in the country as more advanced than the Russian S-300. The system was unveiled on Defense Industry Day by President Hassan Rouhani, according to a statement posted on the president’s official website. “The 373rd is more powerful than the […]
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One thing that is important to understand about the mainstream media is that they do tell the truth on occasion. However, the truths they admit to are almost always wrapped in lies or told to the public far too late to make the information useful. Dissecting mainstream media information and sifting out the truth from the propaganda is really the bulk of what the alternative media does (or should be doing). In the past couple of weeks I have received a rush of emails asking about the sudden flood of recession and economic crash talk in the media. Does this abrupt 180 degree turn by the MSM (and global banks) on the economy warrant concern? Yes, it does.
The first inclination of a portion of the liberty movement will be to assume that mainstream reports of imminent economic crisis are merely an attempt to tarnish the image of the Trump Administration, and that the talk of recession is “overblown”. This is partially true; Trump is meant to act as scapegoat, but this is not the big picture. The fact is, the pattern the media is following today matches almost exactly with the pattern they followed leading up to the credit crash of 2008. Make no mistake, a financial crash is indeed happening RIGHT NOW, just as it did after media warnings in 2007/2008, and the reasons why the MSM is admitting to it today are calculated.
Before we get to that, we should examine how the media reacted during the lead up to the crash of 2008.
In 2007/2008, the discussion revolved around derivatives, a subject just complicated enough to confuse the majority of people and cause them to be disinterested in the root trigger for the economic crisis, which was central bankers creating and deflating bubbles through policy engineering. Instead, the public just wanted to know how the crash was going to be fixed. Yes, some blame went to the banking system, but almost no one at the top was punished (only one banker in the US actually faced fraud charges). Ultimately, the crisis was pinned on a “perfect storm” of coincidences, and the central banks were applauded for their “swift action” in using stimulus and QE to save us all from a depression level event. The bankers were being referred to as “heroes”.
Of course, central bank culpability was later explored, and Alan Greenspan even admitted partial responsibility, saying the Fed knew there was a bubble, but was “not aware” of how dangerous it really was. This was a lie. According to Fed minutes from 2004, Greenspan sought to silence any dissent on the housing bubble issue, saying that it would stir up debate on a process that “only the Fed understood”. Meaning, there was indeed discussion on housing and credit warning signs, but Greenspan snuffed it out to prevent the public from hearing about it.
Today we have a very similar dynamic. Use of the “R word” in the mainstream media and among central banks has been strictly contained for the past several years. In the October 2012 Fed minutes, Jerome Powell specifically warned of what would happen if the Federal Reserve tightened liquidity and raised interest rates into economic weakness. He warned that this would have negative effects on the stimulus addicted investment environment that the central bank had fostered. This discussion was held back from the public until only a year-and-a-half ago. As soon as Powell became chairman, he implemented those exact actions.
Only in the past year has talk of recession begun to break out, and only in the past couple of weeks have outlets become aggressive in pushing the notion that a financial crash is just around the corner. The reality is that if one removes the illusory support of central bank stimulus, our economy never left the “Great Recession” of 2008. Signals of renewed sharp declines in economic fundamentals have been visible since before the 2016 elections. Alarms have been blaring on housing, auto markets, manufacturing, freight and shipping, historic debt levels, the yield curve, etc. since at least winter of last year, just as the Fed raised rates to their neutral rate of inflation and increased asset cuts from the balance sheet to between $30 billion to $50 billion or more per month.
The media should have been reporting on economic crisis dangers for the past 2-3 years. But, they didn’t give these problems much credence until recently. So, what changed?
I can only theorize on why the media and the banking elites choose the timing they do to admit to the public what is about to happen. First, it is clear from their efforts to stifle free discussion that they do not want to let the populace know too far ahead of time that a crash is coming. According to the evidence, which I have outlined in-depth in previous articles, central banks and international banks sometimes engineer crash events in order to consolidate wealth and centralize their political power even further. Is it a conspiracy? Yes, it is, and it’s a provable one.
When they do finally release the facts, or allow their puppet media outlets to report on the facts, it seems that they allow for around 6-8 months of warning time before economic shock events occur. In the case of the current crash in fundamentals (and eventually stocks), the time may be shorter. Why? Because this time the banks and the media have a scapegoat in the form of Donald Trump, and by extension, they have a scapegoat in the form of conservatives, populists, and sovereignty activists.
The vast majority of articles flowing through mainstream news feeds on economic recession refer directly to Trump, his supporters and the trade war as the primary villains behind the downturn. The warnings from the Fed, the BIS and the IMF insinuate the same accusation.
Anyone who has read my work for the past few years knows I have been warning about Trump as a false prophet for the liberty movement and conservatives in general. And everyone knows my primary concern has been that the globalists will crash the Everything Bubble on Trump’s watch, and then blame all conservatives for the consequences.
To be clear, Trump is not the cause of the Everything Bubble, nor is he the cause of its current implosion. No president has the power to trigger a collapse of this magnitude, only central banks have that power. When Trump argues that the Fed is causing a downturn, he is telling the truth, but when he claims that recession fears are exaggerated, or “inappropriate”, he is lying. What he is not telling the public is that his job is to HELP the Fed in this process of controlled economic demolition.
Admissions of crisis in the media are coinciding directly with Trump’s policy actions. In other words, Trump is providing perfect cover for the central banks to crash the economy without receiving any of the blame. Trump’s insistence on taking full credit for the bubble in stock markets as well as fraudulent GDP and employment numbers, after specifically warning about all of these things during his election campaign, has now tied the economy like a noose around the necks of conservatives. The tone of warning in the media indicates to me that the banking elites are about to tighten that noose.
Another factor on our timeline beyond Trump’s helpful geopolitical distractions is the possibility of a ‘No-Deal’ Brexit in October. I continue to believe this outcome (or something very similar) has been pushed into inevitability by former Prime Minister Theresa May and EU globalists, and that it will be used as yet another scapegoat for the now accelerating crash in the EU. With Germany on the verge of admitting recession, Deutsche Bank on the edge of insolvency, Italy nearing political and financial crisis, etc., it is only a matter of months before Europe sees its own “Lehman moment”. The Brexit is, in my view, a marker for a timeline on when the crash will hit its stride.
To summarize, the mainstream media and global banking institutions have two goals in informing the public about recession right now – They are seeking to cover their own asses when the next shoe drops so they can say they “tried to warn us”, and, they are conditioning a majority of the public to automatically blame conservatives and sovereignty proponents when the consequences hit them without mercy.
As the truth of a recession smacks the public in the face, the media will likely pull back slightly, just as they did in 2008, and suggest that the downturn is “temporary”. They will claim it’s “not a repeat of the credit crisis”, or that it will “subside after Trump is out of office”. These will all be lies designed to keep the public complacent even as the house of cards collapses around them. The fact is, the hard data shows that economic conditions in the US and in most of the world are far more unstable than they were in 2008. We are not looking at the crash of a credit bubble, we are looking at the crash of the ‘Everything Bubble’.
The pace of the narrative is quickening, and I would suggest that a collapse of the bubble will move rather quickly, perhaps in the next four to six months. If it does, then it is likely that Trump is not slated for a second term as president in 2020. Trump’s highly divisive support for “Red Flag” gun laws, a move that will lose him considerable support among pro-gun conservatives, also indicates to me that it is likely he is not meant to be president in 2020. This is another sign that a massive downturn is closing in.
As events are unfolding right now, it appears that Trump has served his purpose for the globalists and is slated to be replaced next year; probably by an extreme far-left Democrat. There are only a couple of scenarios I can imagine in which Trump remains in office, one of them being a major war which might require him to retain the presidency so the globalists can finish out a regime change agenda in nations like Iran or Venezuela. This could, however, be pursued under a Democrat president almost as easily as long as Trump and his elitist cabinet lay the groundwork beforehand. As in 2007/2008, it is unlikely that the mainstream would admit to a downturn that is not coming soon. Using the behavior of the media and of banking institutions as a guide, we can predict with some measure of certainty a crisis within the economy in the near term. Clearly, a major breakdown is slated to take place before the election of 2020, if not much sooner.
Depuis quatre jours que notre barre de comptage est affichée, le “19 courant...”, les contributions de nos lecteurs ont été rares, à un point qui nous préoccupe naturellement. C’est une situation courante dans notre fonctionnement, notre préoccupation l’est aussi.
Comme vous le voyez en tête de notre page d’accueil, la barre de donation atteint ce 22 juin au matin €569 alors qu’elle atteignait €492 lorsque nous l’avons installée. Vous mesurez aisément le rythme de progression de nos donations mensuelles pour ce mois d’août 2019, assez pour comprendre qu’il ne nous permettrait certainement pas s’il se poursuivait de seulement entrevoir les premiers contreforts de notre “zone de sécurité”.
Vous connaissez les nombreux arguments que notre site, qui ne dispose d’aucun autre soutien que celui de ses lecteurs et notamment pas celui de la publicité, peut avancer pour solliciter ce soutien. Nous sommes dans des temps toujours plus cruciaux, toujours de plus en plus cruciaux, chaque mois plus cruciaux que le mois précédent. Les crises tant intérieures qu’extérieures se multiplient, nourrissant une dynamique crisique irrésistible qui embrase le Système dans sa totalité. Dans cette fureur métahistorique qui accélère la Grande Crise Générale d’Effondrement du Système, vous avez besoin plus que jamais de la survie et de l’apport essentiel de la presse alternative et antiSystème.
Plus que jamais, nous avons besoin, nous, de votre mobilisation pour le soutien de dedefensa.org.
Mis en ligne le 22 août 2019 à 15H52
Il y a 15 ans, le 10 juillet 2004, nous avions salué l’entrée dans la vingtième année de publication de la Lettre d’Analyse dd&e (quasi-mère biologique du site dedefensa.org), dont le “numéro zéro” avait été publié le 10 juillet 1985. On voit qu’il s’agit d’une longue chaîne de travail, de conceptions et d’évolution de ces conceptions. La Lettre d’Analyse a été conduite au milieu de ce qui constitue sans doute la plus grande période de bouleversement du XXème siècle, à la lumière de ce qui a suivi, à ce point où l’on est tenté de clore le “XXème siècle historique” en 1989 pour mieux aligner la séquence du bouleversement qui conduit à notre situation actuelle.
L’article que nous consacrions à nos vingt ans avait surtout pour but de mettre en évidence l’extraordinaire changement qu’avait connu, pendant ces vingt années, la condition de “journaliste”. En effet, nous confirmons le constat essentiel de cet article, qui est proposé par cette phrase : « De cette façon, les années 1980 constituent l'aboutissement d'une certaine forme de journalisme dont les débuts se confondent avec les origines de la presse moderne. » Cela signifie qu’il y a moins de différences dans les fondements de son travail entre un “journaliste” de 1920 et un “journaliste” de 1995 d’une part, entre ce “journaliste” de 1995 et un “journaliste” de 2000 d’autre part.
(On appréciera bien entendu que nous mettions “journaliste” entre guillemets dans ce cas. La raison en est qu’il y a toujours eu à notre sens au moins deux sortes de “journalistes”, – les deux sortes se définissant par rapport aux liens entretenus, d’allégeance ou pas avec le ou les pouvoirs, – mais qu’à partir de 1989-1995 et disons d’une façon spectaculaire à partir de 1999 [la rocambolesque et terrible guerre du Kosovo], les deux sortes se sont clairement définies, notamment par la sorte de média employé, et la partie défavorisée [les “indépendants” vis-à-vis des pouvoirs] l’étant beaucoup moins à cause de la modicité économique des nouveaux types de médias sur l’internet.)
Les années depuis 2004 ont largement confirmé ce constat. Il existe désormais deux presses, de façon bien distincte et dans tous les domaines (écrits, radios, audiovisuel) : ce que nous nommons la presseSystème, à cause de son allégeance au pouvoir(au Système) et la presse “alternative” plus qu’antiSystème dans la mesure où il est extrêmement difficile de se définir comme antiSystème d’une façon principielle par rapport aux acteurs terrestres, parce que la référence adverse doit être constamment identifiée et construite, parce qu’il n’existe aucun étiquette stable possible :
• être pour le Système est assez facile pour un “journaliste”, puisqu’il suffit de suivre les consignes sans s’interroger sur leur validité et leur efficacité (même si les consignes du Système produisent des effets antiSystème, le “journaliste” de la presseSystème n’en a cure : c’est un bienpensant, un PC, par conséquent il s’interdit tout esprit critique vis-à-vis des consignes, il agit aveuglément, en automate, en zombie, même parfumé et “authoritative”) ;
• être antiSystème demande l’usage continuel de l’esprit critique, d’abord en commençant par comprendre que le Système qui cherche l’entropisation produit du chaos, développe une surpuissance qui se transmue, à mesure mais nécessairement, en autodestruction ; il s’agit donc de déterminer constamment une appréciation critique des productions du Système, y compris et comme souvent quand certaines d’entre elles se contredisent, pour déterminer toujours ce qui est le plus extrêmement nocif pour le Système, pour le signaler, quitte à faire une différence jusqu’à l’opposition dans le comportement du même personnage, quitte à opposer tactique et stratégie, etc. (Un exemple constant à cet égard se trouve dans the Squad des quatre jeunes députées US démocrates et bigarrées : elles soutiennent à fond le LGTBQ, le féminisme et l’antiracisme, l’immigration “frontières ouvertes”, toutes choses prônées ô combien par le Système ; mais elles critiquent Israël-Netanyahou avec une vigueur jamais vue, rendent fou Elliot Abrams le tueur-USA de l’Amérique du Sud, évoquent une “color revolution” aux USA, toutes choses fondamentalement antiSystème.)
Depuis 2004 où est écrit ce texte, les choses se sont incroyablement complexifiées dans le chef de l’antiSystème, tandis que le Système reste figé dans l’attitude-zombie qu’on a décrite. Aujourd’hui, l’essentiel pour le journaliste-sans-guillemets, c’est-à-dire le journaliste qui tend nécessairement à être antiSystème, est bien d’éviter tous les pièges qui se tendent à l’antiSystème, que l’antiSystème produit parfois sinon souvent de lui-même parce qu’il se laisse séduire par les étiquettes et se laisse entraîner, sinon fasciner par tel ou tel événement, tel ou tel personnage, en oubliant l’usage de son esprit critique.
Déjà en 2004, nous définissions plus justement ce vrai-journaliste en présentant « le journaliste devenu chroniqueur historique », c’est-à-dire le chroniqueur qui a choisi une référence en-dehors des contraintes du Système, – la référence historique, que nous avons prestement et plus justement transformé en “référence métahistorique”. Le “journaliste devenu chroniqueur métahistorique”, voilà la formule, en gestation en 2004, évidente aujourd’hui. Le journaliste-zombieSystème a le Système comme référent (“référent” selon le mot qu’employaient les polices politiques dans les manipulations des accusés lors des procès politiques communistes : le référent d’un accusé était l’homme des services chargé de surveiller et d’aiguiller cet accusé, souvent avec douceur voire affection, pour qu’il avoue ses supposés-crimes et se repente pour la gloire du Parti, et réclame une peine exemplaire pour son compte). Le journaliste antiSystème, ou “journaliste devenu chroniqueur”, a la métahistoire comme référence, et il l’a choisie en toute liberté, pour y appuyer solidement son esprit critique ; il sait bien, parce que c’est l’évidence, que la métahistoire ne peut être qu’antiSystème.
Nous entrons avec ce numéro dans la vingtième année de publication de De defensa, dont le premier numéro (“numéro zéro”) date du 10 juillet 1985. Un coup d'oeil rétrospectif sur ce que nous fûmes, sur ce que nous sommes devenus, — et pourquoi...
En 1985, au printemps et à l'été 1985, on commençait à se douter de quelque chose. C'est alors que nous décidâmes de lancer de defensa, sans qu'il y ait de rapport de cause à effet entre ceci et cela. Il n'empêche : il y a une conjonction qu'on peut nommer, selon ce qu'on en croit, “coïncidence” ou signe du destin.
Depuis le 9 mars 1985, Mikhaïl Gorbatchev était secrétaire général du PC de l'URSS. Comme d'habitude, les grands “experts” n'y avaient vu que du feu.
• Voici l'avis sur la nomination de Gorbatchev, le 12 mars 1985, de Richard Pipes, alors au NSC de Ronald Reagan comme spécialiste de l'URSS et l'un des pères des “néo-conservateurs” (et effectivement père de Daniel Pipes, “néo-conservateur” actuel, allumé, et spécialiste du Moyen-Orient) : « La nomenklatura soviétique a tellement peur du moindre changement dans le système hérité de Staline, fondement de ses pouvoirs et de ses privilèges, qu'elle se choisit des secrétaires généraux de plus en plus faibles. »
• Le 15 mars 1985, Zbigniew Brzezinski était de passage à Bruxelles. Il déclara ceci à propos de Mikhaïl Sergueïevitch Gorbatchev : les vieillards du Politburo qui ont choisi Gorbatchev « ont dû voir dans cet homme plus jeune qu'eux quelque chose de rassurant pour eux.[...] Ils l'ont choisi parce qu'il leur donne l'assurance, si vous voulez, d'une immortalité indirecte, parce qu'il continuera(leur)politique, mais en la revitalisant, en lui donnant un nouvel élan »
Deux mois plus tard, en mai 1985, le “jeune homme rassurant” des gérontes du Politburo lançait la plus formidable purge (d'une façon plus civile que les gammes staliniennes) depuis les années trente, mais cette fois contre les vieux cadres du Parti, ossifiés, conservateurs, immobilistes, etc.
Nous l'ignorions alors mais de defensanaissait en même temps qu'éclatait la “révolution” qui allait conduire en cinq ans à l'effondrement de toutes les structures communistes, à la fin d'une époque, à l'éclatement de l'état d'esprit de la binarité politique qui présidait à l'analyse de la situation du monde depuis un demi-siècle. Nous l'ignorions alors, mais c'était encore bien plus que cela qui commençait en même temps que de defensa.
Nous avons connu la plus formidable transition qu'ait jamais connue l'histoire du journalisme : au départ, nous étions subordonnés à des autorités...
Lorsque de defensa commence, le métier de journaliste ressemble, grosso modo, à ce qu'il était un siècle auparavant. Les moyens techniques ont changé, bien sûr, mais pas le fondement de la démarche. Le journaliste dispose de sources classiques (agences de presse, déclarations officielles, interviews formelles ou non mais identifiées, etc.). D'autre part, il a des sources personnelles, rencontrées et “utilisées” informellement, souvent avec lesquelles il lie des liens d'estime, voire d'amitié, dans tous les cas de confiance (c'est souvent l'honneur du journaliste de “protéger” ses sources) ; le plus souvent, ces sources sont laissées anonymes dans ses comptes rendus et ses analyses.
D'une façon générale, le journaliste “respecte” toutes ses sources, générales et ouvertes, particulières et personnelles ; c'est-à-dire qu'il a le sens instinctif d'avoir à apprendre de ces sources, qu'elles sont la source de ses informations, donc l'outil principal et, par conséquent, le plus généralement, qu'elles orientent ses analyses. Le journaliste dépend de ses sources comme le revendeur d'une marque dépend des livraisons de cette marque, et même du choix de cette marque de le garder comme revendeur.
Même les “coups” les plus fameux, dont le Watergate est unanimement et d'un avis conformiste général considéré comme l'archétype, répondent tout de même à une logique politique, voire une idéologie, dont le journaliste est plus l'outil que le manipulateur.
Enfin, au-dessus de tout cela, il y a la bipolarité de la situation, conséquence de la Guerre froide. Il est difficile pour un journaliste traitant une matière plus ou moins proche de la politique, — et le domaine est vaste, — de ne pas se situer d'une façon ou l'autre par rapport à cette référence. Et l'engagement n'est pas accessoire, il est toujours fondamental, par un de ses aspects ou l'autre. Pour nombre de journalistes, c'est presque un aspect de leur “devoir” que de prendre position dans l'affrontement Est-Ouest.
De cette façon, les années 1980 constituent l'aboutissement d'une certaine forme de journalisme dont les débuts se confondent avec les origines de la presse moderne. C'est, si l'on veut, le triomphe du “journalisme de référence”. Plus vous avez de sources hautes placées, plus vous passez pour informé et, par conséquent (ce “par conséquent” est essentiel), plus vous passez paradoxalement pour indépendant du pouvoir. En effet, les engagements implicites qu'illustrent ces situations semblent inévitables, naturels, comme allant de soi, et ils n'interfèrent en aucune façon sur le jugement d'“indépendance” (alors qu'ils le déterminent complètement). C'est l'époque des “authoritative source”, appréciation donnée à ces grands journalistes “de référence” et à ces experts “indépendants” qui sont les vedettes des séminaires, ces gens qui côtoient les plus grands et entretiennent des trains de vie professionnels souvent luxueux, et dont l'avis est à la fois reçu comme techniquement sans reproche et politiquement indépendant.
Nous, à de defensa, nous étions nécessairement hors de ce Circuit (effectivement, les réseaux de ces journalistes et experts, parce qu'ils suivaient finalement les mêmes manifestations et s'abreuvaient aux mêmes sources, constituaient ce qu'on nommait alors le Circuit, — ou l'establishment de l'information, avec une coloration évidemment très fortement transatlantique).
Nous n'avions aucune notoriété, aucun appui particulier. Pour lutter contre la pauvreté de nos moyens, nous tentions de développer une méthode spécifique originale en refusant de suivre nécessairement les grands sujets du jour, imposés par l'agenda des autorités (les grandes négociations, les grandes conférences, etc.). A cette époque, l'accréditation à l'OTAN, pour tout journaliste à Bruxelles traitant des questions de sécurité, était une question de vie ou de mort. Nous étions donc accrédités, mais notre politique était de refuser systématiquement les orientations imposées. Il nous a toujours paru extraordinaire que les ministérielles de l'OTAN réunissent des centaines et des centaines de journalistes, pour filmer des banalités consternantes, se précipiter sur un communiqué composé à l'avance et fruit de compromis jusqu'à l'émasculation complète (le film de l'amputation progressive d'un projet de communiqué dans les semaines précédant une ministérielle est, par contre, d'un intérêt prodigieux pour connaître les véritables positions des uns et des autres) ; pour recevoir des confidences de sous-ministres et autres adjoints, nécessairement faites pour influer sur l'instant, pour peser sur une délibération du jour, etc.
Nous avions donc choisi quelques sujets spécifiques dont le développement méritait un suivi permanent, quels que fussent les péripéties et annonces officielles. Nous suivions la question de la campagne lancée en Belgique pour la coopération dans un nouvel avion de combat (le français Rafale contre l'américain Agile Falcon), la question du développement de l'UEO, la question du développement de l'action intérieure de Gorbatchev par rapport à sa politique extérieure (alors que, sur ce thème, on prenait en général de grandes précautions pour séparer ces deux volets de l'action de Gorbatchev), etc.
Nous nous distinguions du reste par la nécessité de chercher une place originale, parce que nous ne disposions d'aucune des armes habituelles du journalisme occidental : une forte assise financière, un conformisme de vision, une notoriété appuyée sur l'orthodoxie, des canaux de distribution et de promotion assurés et contrôlés dans le cadre du système politico-économique général. Notre originalité et notre indépendance étaient bien réelles, mais moins comme des vertus que d'abord comme les fruits de la nécessité.
Pour cette raison, évidemment, de defensa fut soupçonné de nombreux travers, de corruption, de compromission, tout cela hautement condamnable. Cela apparaissait d'autant plus évident que rien, ni dans notre train de vie, ni dans la logique de nos prises de position, ne justifiait de tels soupçons.
Cette période (1985-1988) fut pour nous celle des premiers enthousiasmes vite contenus et refroidis par l'incertitude, l'isolement, le doute, la sensation d'être “en-dehors du jeu” et, par conséquent, la cible de tous les soupçons et de tous les sarcasmes.
Est-ce que nous vîmes venir la révolution de l'information et des communications, celle qui a changé “leur” psychologie et renforcé la nôtre ? Question intéressante...
Il faut se remémorer ces années entre 1986-1987 (Tchernobyl en avril 1986, surtout le traité des INF en décembre 1987, entraînant la destruction des missiles nucléaires US et soviétiques à portée intermédiaire) et novembre 1989-91 (de la chute du Mur à la dissolution de l'URSS). C'était un temps d'immense confusion, à la fois des plus affreux soupçons (ces événements cachent-ils des manigances ?) aux plus ardents enthousiasmes (nous approchons, nous vivons, nous “touchons” des événements historiques). Ce n'était plus “l'imagination au pouvoir” de 1968, c'était “l'Histoire s'approprie l'imagination”.
Mais la réalité humaine, — ce que nous nommons “l'Histoire événementielle”, — évoluait différemment. A côté des événements historiques purs se développaient des événements technologiques considérables, à l'aspect historique certes, mais indirects. Plus tard, nous nommerions le résultat de cette évolution : “virtualisme”, désignant par ce mot, non pas un accident, non pas une incidence d'attitudes diverses, non pas des modifications même très importantes de choses déjà existantes, — mais une modification fondamentale, substantielle, de l'“Histoire” faite par les humains, accompagnant, ou précédée par une transformation également substantielle de la psychologie elle-même. (Nous ne parlons pas en termes absolus à cet égard : “la psychologie elle-même”, certes, mais pas la psychologie de tous ; certains y échappèrent, y échappent, y échapperont. Nommons-les “dissidents”.)
Nous jugeons, sans surprise pour nos lecteurs, que les structures définitives du virtualisme furent mises en place en Amérique, sous l'administration Reagan. Nous pouvons même offrir une date symbolique et “politique” à cet égard : au printemps 1983, lorsque le conseiller spécial du président pour les communications obtint un siège au National Security Council, le gouvernement “particulier” du président US, au même titre que le directeur de la CIA ou le secrétaire d'État. A partir de là, l'“événement”, — décision ou réaction de l'administration, — devint une matière envisagée selon son effet de représentation et de perception dans un monde nécessairement artificiel, et non selon son effet direct dans le monde réel.
Avons-nous réalisé cette révolution, que nous serions tentés aujourd'hui de qualifier à la fois d'inouïe et de sans précédent, alors qu'elle avait lieu quasiment sous nos yeux ? Non, bien sûr. Nous sentions qu'il se passait quelque chose mais aucune réalisation synthétique fondamentale (l'acceptation in fine, même si le mot n'a pas été encore présenté par nous comme néologisme fondamental, du virtualisme). Nous avons réalisé au fur et à mesure, chemin faisant. Ou bien, pour certains, pour la plupart, — il n'y a pas de réalisation de quoi que ce soit, il y a le refus ou, plus souvent, l'ignorance de l'hypothèse d'une modification de la structure de l'Histoire.
Cette position pourrait sembler “évidemment raisonnable”, selon un système de pensée qui rejette la possibilité d'effets importants, voire rationnels, de domaines irrationnels. Elle est surtout rationnelle jusqu'à l'extrême, avec le risque énorme du travers que nous voyons dans cette attitude : que l'attitude rationnelle dissimule en réalité du rationalisme, ou enfante le rationalisme, — c'est-à-dire passer du fait (rationnel) au « système d'opinion » (rationalisme). Au lieu d'utiliser la raison comme outil pour comprendre le monde (y compris l'irrationnel du monde), cette attitude revient à faire de la raison une arme pour transformer le monde à sa guise (c'est-à-dire, forcer l'irrationnel non dans un jugement de la raison pour sa compréhension mais dans une pression de la raison pour sa transformation, et que l'irrationnel devienne arbitrairement du rationnel).
Il nous semble que les événements ont largement corroboré cette évolution qui, d'hypothèse, tend à devenir un outil de compréhension d'une évolution extraordinairement rapide de l'Histoire. C'est à cet égard que les événements depuis le 11 septembre 2001, et le 11 septembre lui-même, ont constitué un événement essentiel d'une révolution, un « tournant profond » comme disait Victor Serge à propos de la révolution bolchévique et de l’arrivée de Staline. L'exceptionnel se trouve dans ce que cette révolution, effectivement, s'est exercée dans un autre domaine que ceux habituellement considérés pour cette sorte d'événements, et que les anciennes sciences qui définissaient cette sorte d'événements, — la stratégie, la géopolitique, etc., — passent complètement au second plan au profit de nouvelles activités : communications, psychologie, etc., jusqu'à “notre” virtualisme.
L'intérêt de cette période historique, ce “temps historique” que nous avons vécu est qu'il est très rapide dans ses transformations, et qu'il est instantané. L'expression assez grossière “en temps réel” peut être employée aujourd'hui pour l'Histoire, ce qui est une révolution sans précédent pour la psychologie. La compression des événements est telle que nous vivons en même temps ce que nous nommons l'“actualité” et l'Histoire, — ou, dit autrement : l'“actualité” est directement historique.
Pour la compréhension de ces phénomènes, l'un des très rares avantages des conditions que nous connaissons est que cette Histoire qui se fait sous nos yeux est rigoureusement bornée. Ainsi, et malgré l'attirance bien compréhensible pour le caractère essentiel du 11 septembre 2001 (certainement événement historique, on l'a dit), nous dirions que l'événement fondamental, le basculement entre la “pré-histoire” de notre temps historique et son début effectif, est la guerre du Kosovo (23 mars-11 juin 1999). C'est effectivement au cours de cet événement, quelle que soit l'importance qu'on y attache, et, même, quel que soit le parti qu'on choisit, qu'un changement de substance s'est manifesté. L'événement n'a pas eu tant d'importance du point de vue militaire (victoire acquise par avance, fin des hostilités puis après-guerre sans modifications fondamentales des conditions générales de la situation de désordre, d'incertitude, etc.) que du point de vue de sa représentation générale, tant médiatique que du point de vue de la communication de l'information. Nous nous sentîmes autorisés à écrire un article dont le titre était : « la première guerre virtualiste » (voir notre rubrique Analyse, de defensa du 10 septembre 1999).
Pour le chroniqueur qui possède l'accès à l'essentiel des informations du monde, la question centrale aujourd'hui est de distinguer l'essentiel de l'accessoire, l'Histoire des événements sans importance, le qualitatif du quantitatif...
Bien entendu, tout n'est pas si simple, et c'est même le contraire. Lorsque nous écrivons : “La compression des événements est telle que nous vivons en même temps ce que nous nommons 'l'actualité' et l'Histoire, — ou, dit autrement : 'l'actualité' est directement historique”, — il est bien entendu que tous les événements ne sont pas historiques, que la plupart, même, ne le sont pas, d'autant plus que le virtualisme en fait des non-événements dont l'absence totale de substance répond à l'apparence tapageuse. Il y a donc un problème fondamental de jugement, de choix des événements, ce qui est une nouvelle réalité du monde complètement complexe et difficile à débrouiller. C'est l'autre phénomène le plus important, — avec celui de l'afflux d'informations, comme on va voir, — caractérisant la révolution qui a bouleversé notre métier, et le contenu de de defensa par conséquent, depuis nos origines il y a 20 ans.
L'afflux d'informations, justement, considéré vingt ans plus tard... Nous en avons peu parlé parce que la chose va aujourd'hui de soi. C'est pourtant une révolution essentielle, qui fait que le journaliste d'aujourd'hui n'a plus rien à voir avec ce qu'il était il y a vingt ans, tel que nous le décrivions plus haut. La question des sources, de l'accès aux autorités, c'est-à-dire stricto sensu la question de l'information résolue par la révérence devant l'autorité qui caractérise les “journaux de référence”, tout cela est devenu complètement marginal pour comprendre le monde. Aujourd'hui, le journaliste, dans l'éventuel accomplissement parfait de sa fonction (et non dans sa perversion), est devenu chroniqueur historique parce qu'il dispose des moyens de l'être. Il a dans ses mains le formidable outil de l'accès à toutes les informations du monde, à la vitesse de la lumière, qu'on lui a gracieusement fourni. Cela lui permet de figurer, comme chroniqueur historique, dans une position au moins d'équivalence par rapport aux autorités qui exercent le pouvoir mais qui produisent de moins en moins d'événements historiques, alors qu'il y a 20 ans il se trouvait au stade de la révérence accentuée.
(Continuez à savourer ceci, maintes fois signalé ici, comme on savoure une sucrerie de qualité : le système contre lequel le journaliste devenu chroniqueur historique doit à son honneur de partir en guerre a créé l'outil qui lui permet de mener cette guerre avec des chances raisonnables de remporter quelques cinglantes victoires. Savourez la douceur du paradoxe en vous rappelant que c'est Internet avec ses multiples sources qui a réussi à totalement foutre en l'air la machine américaniste lancée dans son absurde guerre irakienne.)
Aujourd'hui, le journaliste devenu chroniqueur historique n'a plus de révérence à faire devant les pouvoirs établis. Il en sait autant qu'eux, parfois plus. Bien entendu, ces journalistes devenus chroniqueurs historiques sont le petit nombre, les happy few, le plus grand nombre n'ayant rien vu venir ni passer et s'étant enfoncé dans la définition ancienne pervertie de leur fonction. Les “journalistes” du système, ceux qui poursuivent leurs durs labeurs dans les “journaux de référence” font de moins en moins d'information, sans parler de chronique historique qu'ils ignorent complètement, et, au contraire, des révérences de plus en plus prosternées (voir Le Monde, le Financial Times, le New York Times et ainsi de suite, tous devenus autant d'“officiels” comme l'on disait de la Pravda, reflétant avec zèle les considérations des puissances en place, précisément celles de Washington).
Le journaliste devenu chroniqueur historique, pour l'être justement, est désormais placé devant un problème de choix, de sélection. Il est placé devant le problème de la réalité confrontée au virtualisme, donc devant ce phénomène formidable que la vision objective qu'il doit façonner de l'Histoire sera nécessairement le produit de ce qui est au départ un choix subjectif. Il devra distinguer lui-même, grâce à ses propres références, appuyé sur son expérience et sur les outils énormes de disposition de l'information dont il dispose désormais, les courants essentiels des événements accessoires. Il devra avoir la prudence salutaire de répudier systématiquement toutes les versions officielles publiques du système dont on sait, depuis diverses déclarations fameuses, notamment de Donald Rumsfeld (au moment de l'attaque contre l'Afghanistan, il avait déclaré que le mensonge officiel était une nécessité de sécurité nationale destinée à protéger les troupes en action), qu'elles sont systématiquement, presque chirurgicalement mensongères. Une fois posé cet acte, peut-être pourra-t-il songer à une étude suspicieuse de ces déclarations pour, par comparaison, par analogie, en recueillir une parcelle ou l'autre de vérité indirecte.
Aujourd'hui, le rôle du “journaliste devenu chroniqueur historique” est devenu tout simplement fondamental, et il est peut-être unique. Les fonctions traditionnelles du domaine, elles (les “journalistes de référence”, les “historiens” en général acquis aux conceptions du système et repliés sur la seule exactitude scientifique, etc.), ont définitivement abdiqué tout rôle critique fondamental au profit de l'application des mots d'ordre du système.
Il s'agit bien d'une révolution, qui s'est déroulée sur ces vingt années dont nous “fêtons” cette saison l'achèvement, dans un climat mitigé de fierté du devoir accompli et d'incertitude devant les bouleversements extraordinaires dont nous mesurons chaque jour l'ampleur. Nous avons conscience que le “métier” de l'information est devenu d'une telle importance, bien au-delà des ronronnements sordides sur la “liberté de la presse”, sur la “liberté de l'information”, qu'il est à la fois l'instrument de sauvegarde ultime de la civilisation et un fardeau d'un poids extraordinaire pour ceux qui prennent le risque d'accepter de s'en charger. Notre métier n'est plus un choix, une aventure, un défi, etc., il est devenu un véritable destin.
C'est une sensation à la fois étrange, exaltante et effrayante d'avoir le pouvoir de comprendre soi-même, sur le moment, lorsqu'il est vécu, que ce moment fait partie d'un événement absolument historique, — à chaque instant pour ainsi dire. C'est exaltant et effrayant.
Vingt ans après, ou comment le métier de journaliste, le “métier de l’information”, a connu une révolution copernicienne, du “journaliste” au “chroniqueur de [la méta]histoire” ...
Le “métier” de l'information a, en 20 ans, complètement, radicalement changé. Les “journalistes”, plus ou moins “sérieux”, se sont divisés en deux. D'une part, une masse de gens écrivant dans un monde désormais virtualiste, sur des sujets démesurément grossis, renvoyant aux impératifs idéologiques du virtualisme. C'est le cas, lorsqu'on voit en France (11-15 juillet) la presse officielle unanime, “journaux de référence” en tête, consacrer des pages (nous disons : des pages, pas des colonnes) à une agression contre une jeune femme dans le RER, parce que cette agression aurait eu un caractère antisémite, alors qu'elle se révèle n'être qu'un montage de la dame en question ; alors qu'on débat aux USA, au même moment, de la possibilité d'une suspension de l'élection présidentielle qu'on pourrait assimiler à « a Washington coup d'Etat », pas une ligne n'apparaissant sur cette question, hors un entrefilet ou l'autre. Il y a quelque chose de définitif dans cette grotesquerie professionnelle, qui situe l'avancement inquiétant des désordres psychologiques, désormais du domaine de la psychopathologie.
D'autre part, des individus ou groupes d'individus, manifestement les happy few en termes de moyens financiers et de volume apparent d'influence, des dissidents qui s'en tiennent au monde réel, l'observent et le commentent. (Ils le peuvent, notamment, grâce à ce bijou de la liberté qu'est Internet.) Placés devant les cohortes des grotesques affublés du nom de journalistes (ou commentateurs), devant l'énormité du spectacle qui leur est offert, devant la gravité de la psychopathologie ainsi observée, ces happy few en viennent nécessairement à faire beaucoup plus que du simple journalisme. Non seulement ils commentent, mais plus encore, ils sont conduits à offrir une vision générale et globale de la crise de notre temps. Ils sont placés devant l'évidence de la crise de civilisation qui nous déchire avec une force et une rapidité inouïes. Leur devoir est d'en rendre compte.
Notre honneur, à de defensa, vingt ans après, est de faire partie de ce second groupe. C'est moins un honneur prémédité qu'un honneur retrouvé.
Et si finalement Hillary avait eu raison ? Et si le Donald était ce président déplorable, doté d’une diplomatie déplorable, d’une puissance militaire déplorable, de manières déplorables et d’une balance commerciale déplorable (déficits prodigieux malgré les fameuses sanctions) ? Et si cet électorat de petits blancs hébétés par leurs médias néocons était un électorat de déplorables, bourré de ces chrétiens sionistes, éternels gobe-tout, qui aujourd’hui veulent la guerre avec la Chine, la Russie, l’Iran, et même avec une partie de notre Europe ?
Philippe Grasset a rappelé que le pentagone avait fait un « bras d’honneur » au pourtant bien soumis Macron pour avoir évoqué une « architecture européenne de défense » avec Vladimir Poutine. Quand bombarderont-ils Paris ? Ils menacent aussi la Grèce de complicité de terrorisme dans le cadre de leur persécution hallucinée de l’Iran.
La montée de la rage rance américaine accompagne la montée de leur impuissance. La guerre hybride a remplacé une guerre physique devenue impossible, même avec l’Iran et le Venezuela. Des experts US expliquaient avant-hier que dans la zone Inde-Pacifique l’US Navy n’est plus à la hauteur technologiquement. Déclin en piqué depuis la dernière démentielle campagne en Irak…
Lisons Orlov qui écrivait l’autre jour :
« Comme d’autres techniques américaines de changement de régime, qu’elles soient militaires ou financières, la méthodologie de la Révolution Colorée n’est plus en mesure de produire les résultats escomptés, c’est à dire le renversement de l’autorité légitime et l’installation d’un gouvernement fantoche. Mais, tout comme les autres techniques, elle est encore capable de faire des victimes.À ce jour, l’establishment de Washington a complètement perdu la main, tant sur le plan national qu’international. Les guerres commerciales ont été perdues ; les guerres de sanctions sont devenues des objets tournés en ridicule ; les menaces d’escalade militaire se sont révélées creuses. Tout le système financier américain est un homme mort (walking dead) qui marche encore.Que peuvent donc espérer les Washingtoniens ? Eh bien, ils peuvent toujours utiliser la méthodologie de la Révolution Colorée pour fomenter une révolte futile et inutile et, ce faisant, ruiner de nombreuses jeunes vies. »
Or il est dangereux de trop avoir recours à la révolution colorée quand on a une population si bigarrée à l’intérieur de ses frontières, population bien sûr présentée comme une chance pour l’Amérique. Le résultat c’est que les jeunes élues musulmanes tournent le dos à Israël (où elles n’ont pas eu le droit de se rendre, ô démocraties !) ; que l’histoire et la littérature sont devenues impossibles à enseigner en Amérique, où les jeunes blancs sont devenus minoritaires ; le résultat c’est que cette jeunesse nouvelle et enrichissante est mûre pour une révolution orange en Amérique. Ce ne sera pas orange mécanique, mais orange ethnologique. Notre walking dead perclus par son impérialisme humanitaire se planquera, et on ne le pleurera pas.
Sanctions against the people
A new embargo against Venezuela became effective on August 5th through an Executive Order signed by United States President Donald Trump, titled “Executive Order on Blocking Property of the Government of Venezuela.”
This new executive order against the Bolivarian Republic came with the usual mantra from the media that the sanctions do not affect the Venezuelan people but the “Maduro regime.” Although the Executive Order directly indicates the blockade of all assets and interests of the Venezuelan government, what is not outlined clearly is that their interpretation of the Venezuelan government also means the Venezuelan State.
The intensifying sanctions campaign against the Venezuelan State began two years ago in August 2017 and has only increased the suffering of the Venezuelan people and does not threaten the collapse of the Bolivarian government. The sanctions have created significant obstacles for investments in Venezuela and directly affect companies operating in the country. This has only intensified the suffering of the Venezuelan people. Why would sanctions against the government affect the general population though?
Despite the media mantra that sanctions do not affect the people as the embargo does not target medicines and food, the sanctions do target the financial and technological sectors. This means that the buying, selling, updating and importing of medical, surgical, pharmaceutical, laboratory equipment, telecommunications, and internet and hosting will suffer obstacles because the Executive Order prohibits the assistance or sponsorship of entities or individuals in the material and technological exchange with the country.
The development of telecommunications go hand in hand with foreign investments, particularly from China. Therefore, it can be observed that the sanctions do not also aim to financially topple Venezuela, but also to hinder China’s impressive economic presence in Latin America, challenging Washington in its “own backyard.”
Similarly, servers, domains on the internet and hosting, begin to suspend their relations with Venezuelan companies. However, as internet and hosting companies begin to suspend their relations with Venezuela, as had happened with Sedo, it is only a matter of time before payment systems such as Paypal stop providing services to users in Venezuela.
In addition, because of the new sanctions, there is a strong possibility that commercial shipping to Venezuela will significantly reduce as shipping companies will suffer threats or sanctions when dealing with Venezuela. This will only amplify a food shortage in the Bolivarian Republic as foreign private distribution lines can face sanctions if directing goods to the country.
Lima Group in support of the sanctions
The Peruvian capital of Lima is the continued location for the Lima Group, a multilateral body consisting of Brazil, Canada, Chile, Colombia, Costa Rica, Guatemala, Honduras, Mexico, Panama, Paraguay and Peru, with the full backing of Washington of course, and was the scene of a meeting between foreign ministers, diplomatic representatives and other operators involved in the regime change in Venezuela. The Peruvian host, Foreign Minister Nestor Popolizio, declared the body’s support for Juan Guaidó as interim president of Venezuela.
Popolizio said they expect the US blockade “will allow Nicolás Maduro’s departure from power sooner rather than later.”
“All countries have listened to the measures taken by the United States last night (Monday). They have raised them at the meeting and what we have done is take note of them, because we know they will have a real impact within the Maduro regime and we hope that allow the regime to leave sooner rather than later,” the Peruvian foreign minister told reporters.
And of course, that typical mantra was also made by Popolizio, with him stating that the sanctions are “not against the people of Venezuela.” Therefore, there is the disturbing reality that a dozen countries in the Americas support the blockade against Venezuela. With the effort to incorporate American countries into the same agenda, the possibility of this bloc expands the measures against Venezuela as part of adhering to US foreign policy.
The US policy of collective punishment on Venezuelan people
The most disturbing part in a report titled “Economic Sanctions as Collective Punishment: The Case of Venezuela” by the Center for Economic and Policy Research (CEPR) found that 40,000 deaths in Venezuela can be directly attributed to Trump’s sanctions.
“The sanctions are depriving Venezuelans of lifesaving medicines, medical equipment, food and other essential imports. This is illegal under international laws and treaties that the US has signed. Congress should move to stop it,” said Mark Weisbrot, the CEPR Co-Director and co-author of the report.
The report was also co-authored by Jeffrey Sachs who teaches at Columbia University and was a director of the Harvard Institute for International Development at the Kennedy School of Government. He said that “Venezuela’s economic crisis is routinely blamed all on Venezuela. But it is much more than that. American sanctions are deliberately aiming to wreck Venezuela’s economy and thereby lead to regime change. It’s a fruitless, heartless, illegal, and failed policy, causing grave harm to the Venezuelan people.”
“The sanctions reduced the public’s caloric intake, increased disease and mortality (for both adults and infants), and displaced millions of Venezuelans who fled the country as a result of the worsening economic depression and hyperinflation. They exacerbated Venezuela’s economic crisis and made it nearly impossible to stabilize the economy, contributing further to excess deaths. All of these impacts disproportionately harmed the poorest and most vulnerable Venezuelans,” the report said.
With these shocking facts revealed by the report, it is rendered shocking that American states, the overwhelming majority Latin, would support sanctions that have killed at least 40,000 people and surely more. Because of the little support that Venezuela finds in the region, it has had to look abroad and find new friends, the most obvious being the Great Powers of Russia and China, but also towards far away Middle Powers like Turkey and Iran in the Middle East – regional hegemons in their own right, but with little history of this level of activity in Latin America. It is largely because of these transcontinental relations on the international front that the Maduro administration has with these states that Venezuela has been able to survive against the intense sanctions and pressures it receives from the United States and the Lima Group.
Domestically, we should include, Maduro has been able to maintain support from broad sectors of the population as a result of the social welfare and wealth redistribution policies of the government. Without this support from Venezuela’s people, the mass mobilizations against those mobilizations sponsored by the U.S backed NGO sector against the government would not be possible.
Columbia University’s Jeffrey Sachs makes a compelling case. Black’s Law Dictionary defines ‘Collective Punishment’ as: “A penalty inflicted on a group of persons without regard to individual responsibility for the conduct giving rise to the penalty”. It further reminds that “Collective punishment was outlawed in 1949 by the Geneva Convention”.
This is significant in that this places those in vectors of US power supporting these measures in the same camp as those who historically have committed similar atrocities – war crimes and crimes against humanity.
What should be reminded here as well, is that the results of the Nuremberg Trials have further informed international law and interpreted, probably justifiably, the Geneva Conventions also to apply to journalists and publications which authored and published editorials in support of such actions. Any number of US journalistic and news outlets have indeed published such: the question remains as to whether there will ever be a ‘truth and reconciliation’ period, where such publications are held to account for their commissions of war crimes and crimes against humanity, as the balance of power in the world continues to sway away from the post-WWII and post-Cold-War paradigms of (varying) US global hegemony.
US progressives and US soft power
This touches on another aspect of the relative inability of the US to successfully garner internal support for further action against Venezuela. For the last three or four decades, the US has relied significantly on soft-power vectors of influence in order to influence or even ultimately topple governments whose policies were at odds with the interests of multi-national and trans-national corporations with strong ties to the US or trans-Atlantic financial interests.
These soft-power vectors themselves take the form of numerous NGOs which may be financed by a web of private sponsors and even state-actors through the UN, or through the US’s own National Endowment for Democracy (NED) and US-AID.
In turn these NGOs rely on being staffed by members of civil society, citizens, professionals, who donate finances and expertise, or work as staff on payroll, who themselves identify as part of a general movement or progressive trend towards social and economic justice. Often these people come with a particular focus on human rights, and in particular often with a focus on the reproductive rights of women and the rights of women and girls.
Venezuela has done an excellent job at telling its own story in a way which is sympathetic to this very same milieu, and indeed relies upon real statistical data registered with the World Health Organization and the UN’s Human Development Index to effectively argue their case. Because of this proven track record, as a consequence the US has had a much more difficult time at exerting real soft power pressure upon Venezuela when compared to the more effective narrative it has been able to associate with countries like Iran. In short, the staff of US backed NGOs which may be more open to generally anti-Iranian or anti-Russian narratives on subjects relating to intersectional oppression and patriarchy, are much more apprehensive about being ‘deployed’ as a US soft-power agent to work against Venezuela – a country that has proven its commitment to ‘human rights’ within a language compatible with the discursive framework of the US and first-world left.
To wit, the Lima Group countries which have supported US actions against Venezuela are nearly universally led by governments which draw upon the US’ pre ‘soft-power’ strategy; one which echoes back strongly to themes of dictatorship and right-wing paramilitaries and death squads. Thus, the would-be staff of the US Non-profit industrial complex is more informed and better educated on the US history in Latin America as opposed to Eastern-Europe and the MENA region – even when some of the staff, supporters, and activists themselves come from those regions.
This phenomenon may be a product of a hierarchy of values – placing certain areas of observing human rights within a country (for example, the perceived status of women and girls) as a main priority, even over the generally disastrous consequences of US intervention. US intervention, though generally couched within the framework of defense if human rights as outlined in the so-called Chicago Doctrine (or R2P – Responsibility to Protect), often destabilizes a whole society, even the surrounding geographic region. Even though in the process of destabilization, and in the aftermath, the status of women and girls significantly deteriorates as they would be expected to, under worsened economic conditions and conditions of war (which lead to increases in human trafficking, lack of access to medical care, etc.), such consequences often escape the projections and calculations of staffers of US-backed NGO’s nominally dedicated to human rights.
Therefore, Venezuela has succeeded in disarming a significant segment of US soft-power efforts by strategically intersecting the ideological framework of the staffers and ‘zealots’ of the US NGO sector itself.
Concluding thoughts and policy recommendations
The recent round of sanctions against Venezuela, effective August 5th, will have a deleterious effect on transactions which effect individuals at the individual level, such as the suspension of various internet hosting possibilities, and even the cutting off of Paypal. Shipping companies may also feel significant pressure, and may evaluate that on the balance, business with Venezuela is a much less attractive option.
Countries such as China could work to protect their investments and commitments in Venezuela by offering assurances and guarantees to various international shipping companies, including supply-line security measures using its navy.
These US policies qualify as collective punishment, and those US policy advocates, politicians, corporate leaders, and media/journalistic outlets which have supported these illegal policies, are guilty of crimes against humanity. Ultimately, justice will demand that these individuals be brought to justice at The Hague, or other similar court empowered by the UN at the level of the General Assembly, and these should be pursued.
The US relies significantly on soft-power in numerous stages of a regime-change operation, but the operationalization of progressive/left oriented NGOs which the US uses effectively in other regions, are less of a utility given Venezuela’s success at telling its story within a discursive framework which the staff of these NGO’s find sympathetic.
By Grey Carter – I came across an interesting article on MEMO concerning Kosovo (Albanian) stance towards ISIS/IDIL, since ‘Kosovo’ is as local Albanians claim ‘the youngest republic in Europe’, which unilaterally proclaimed itself to be independent of Serbia in 2008. Today it seems that so-called Kosovo has become fertile recruiting ground for ISIS. During […]
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ISIS recruitment, Jihad and Kosovo Albanians (WARNING, VERY DISTURBING IMAGES) - Fort Russ
By Grey Carter - I came across an interesting article on MEMO concerning Kosovo (Albanian) stance towards ISIS/IDIL, since ‘Kosovo’ is as local Albanians claim ‘the youngest republic in Europe’, which unilaterally proclaimed itself to be independent of Serbia in 2008. Today it seems that so-called K
L. Brent BOZELL III
On her weekly Sinclair TV show, “Full Measure,” on Aug. 18, former CBS News correspondent Sharyl Attkisson interviewed pollster Scott Rasmussen about journalists’ standing in the public square. They’re about as trusted as Wikipedia, the website considered so unreliable that school teachers often tell students they can’t cite it as a source for their research papers.
Only 38 percent said national political coverage is accurate and reliable, while 42 percent said it is not. “We asked about national political reporters. Are they credible? Are they reliable?” said Rasmussen. “And you know, a little more than 1 out of 3 people say yes. When we ask about Wikipedia, we get the exact same answer. So what’s — what’s happening is we have a world where people look at journalists like they look at Wikipedia.”
You hear the media elites often break out the nostalgia for an era when the American people had “shared facts.” Translation: a time when all Americans had the “mainstream” media to tell them what the “facts” were, and when those in that “mainstream” enjoyed a monopoly in their industry. Facts always seemed carefully arranged for political impact. For example, the TV anchors told us the Vietnam War was an unwinnable quagmire. Watergate was the worst scandal in American history. The Soviet Union only wanted peace. The wealthy were greedy. Planet Earth would succumb to global warming. And Planned Parenthood cares about children.
All this created a national hunger for alternative sources of information. The addition of Fox News, conservative talk radio, and conservative news websites and blogs in the ’90s is decried as the dawn of a new era of “misinformation.”
The media’s dramatic tilt has clearly taken a toll on their image. Rasmussen told Attkisson that 78 percent of voters say reporters don’t report news so much as they promote their agenda: “They think they use incidents as props for their agenda rather than seeking accurate record of what happened. … Only 14 percent think that a journalist is actually reporting what happened.”
That result is just devastating. The “news” media no longer exist.
Then Rasmussen added a layer of public cynicism: “If a reporter found out something that would hurt their favorite candidate, only 36 percent of voters think that they would report that.” The public sees the media for what they are: flagrant activists manipulating the democratic process.
Attkisson also interviewed former CNN anchor Frank Sesno to react to this massive credibility problem. Sesno toed the company line and, in so doing, tripped over his own tongue. “The public understands fundamentally what journalism should be,” he said. “They don’t understand how it’s actually practiced.” What does that mean? The public isn’t well-informed enough to know how well-informed it would be if it were to trust the press?
If media organizations really wanted to improve their image, they would address public skepticism seriously, taking some very simple steps. Stop trying to bury every bit of good news for President Trump and every bit of bad news for Bernie, Biden & Co. Try to acknowledge that policy debates have two sides. It is fair to question climate change, support our national identity and oppose the abortion industry trafficking human carnage.
Is it too late? Conservatives have walked away from these networks and newspapers, which means that their audiences are now mostly liberals who reject everything conservatives champion. Obviously, from all we’ve witnessed, liberal journalists are much more sensitive to criticism from fellow liberals than they are to the American public. That’s unlikely to change, so the credibility crisis will only deepen.
With a peace agreement between the US and the Taliban nearly completed, will President Trump be able to do what his two predecessors were unable to do – end the US military’s 18 year war on Afghanistan?
Apparently, President Trump's hint that the Department of Agriculture might authorize another tranche of bailout funds for America's farmers wasn't enough to quell their anger. Because in what Bloomberg described as a "sign of rising tensions with the farm community," staffers from the USDA's Statistical Service was pulled from a popular but privately run Midwestern crop tour after a government employee was reportedly threatened.
The threat didn't come from somebody involved in the Crop Tour, but the USDA decided to pull all staff as a precaution.
Lance Honig, crops chief at the USDA’s National Agricultural Statistics Service, was scheduled to address the tour in Nebraska City Tuesday night, but a video interview with him was screened instead.
"Federal Protective Services were contacted and are investigating the incident," NASS Administrator Hubert Hamer said Wednesday, without giving details on the threat. "The safety of our employees is our top priority."
The animosity toward the USDA might be inspired by the fact that the USDA has been criticized for publishing crop estimates that were larger than anticipated, weighing on the price of agricultural commodities at an already difficult time for American farmers, who have been struggling with the fallout from Trump's trade war with China. Beijing recently revealed that it would scrap plans to buy more soybeans and other American agricultural goods.
The USDA had already been criticized for its June estimates, and decided to take the rare step of re-surveying farmers to test the accuracy of their information.
The USDA's decision to withdraw from the crop tour comes about two weeks after farmers leveled criticism at Agriculture Secretary Sonny Perdue at a fair in Minnesota over the trade war with China.
In a statement Wednesday, Pro Farmer parent company Farm Journal said it took the threat seriously and has also taken care to ensure the safety of participants.
"For 27 years the Pro Farmer Crop Tour has been a public service for the benefit of agriculture, in good times and bad," it said. "And it’s clearly a stressful time right now."
During recent stops in Indiana, Illinois and Nebraska, farmers asked government officials and employees of Pro Farmer about the government's methods for determining corn planted area and yields after a swift swing in prices left many farmers in the lurch. The USDA said yield estimates were based largely on input from pro farmers as well as satellite imagery.
One farmer interviewed by BBG stressed that most farmers likely wouldn't condone the threats.
"We had a great time with the USDA guys yesterday," said Jim Putnam, a Minnesota farmer, who traveled with two USDA staff on the tour Tuesday. "I’m sorry this happened. It makes us all look stupid."
But, if nothing else, the animosity that the USDA is struggling hints at just how contentious the 2020 race could be for farmers who have largely suffered under President Trump's policies, despite supporting him during the election.
Two world wars began because of unconditional pledges made by one country to come to assistance of another. On July 5, 1914, Kaiser Wilhelm II of Germany pledged his country’s complete support for whatever response Austria-Hungary would choose to make against Serbia after the June 28th assassination of Archduke Franz Ferdinand of Austria by a Serbian nationalist during an official visit to Sarajevo, Bosnia. This fatal error went down in history as Germany’s carte blanche or “blank check,” assurance to Austria that led directly to WW I.
In September 1939, World War II began when Great Britain and France came to the assistance of Poland after the German Army invaded, fulfilling a “guarantee” made in March of that year. What was a regional war, and one that might have been resolved through diplomacy, became global.
One would think that after such commitments were assessed by historians as the immediate causes of two world wars, no one would ever consider going down that road again. But that would be reckoning without Republican Senator Lindsey Graham who has been calling for a “defense treaty” with Israel since last April. In his most recent foray, Graham announced late in July that he is seeking bipartisan support for providing “blank check” assurances to Israeli Prime Minister Benjamin Netanyahu and is hoping to be able to push a complete defense treaty through the Senate by next year.
In making his several announcements on the subject, Graham has been acting as a front man for both Israeli Prime Minister Benjamin Netanyahu and also for The Jewish Institute for the National Security of America (JINSA), which wrote the basic document that is being used to promote the treaty and then enlisted Graham to obtain congressional support.
Speaking to the press on a JINSA conference call, Graham said the proposed agreement would be a treaty that would protect Israel in case of an attack that constituted an “existential threat”. Citing Iran as an example, Graham said the pact would be an attempt to deter hostile neighbors like the Iranians who might use weapons of mass destruction against Israel. JINSA President Michael Makovsky elaborated on this, saying, “A mutual defense pact has a value in not only deterring but might also mitigate a retaliatory strike by an adversary of Israel, so it might mitigate an Iranian response (to an attack on its nuclear facilities).”
JINSA director of foreign policy Jonathan Ruhe added that “An Israeli strike on Iran’s nuclear program would not activate this pact, but a major Iranian retaliation might. – An Israeli unilateral attack is not what the treaty covers, but rather massive Iranian retaliation is what we are addressing.”
Israel has long been reluctant to enter into any actual treaty arrangement with the United States because it might limit its options and restrain its aggressive pattern of military incursions. In that regard, the Graham-JINSA proposal is particularly dangerous as it effectively permits Israel to be interventionist with a guarantee that Washington will not seek to limit Netanyahu’s “options.” And, even though the treaty is reciprocal, there is no chance that Israel will ever be called upon to do anything to defend the United States, so it is as one-sided as most arrangements with the Jewish state tend to be.
As the agreement between the two countries would be a treaty ratified by the Senate, it would be much more difficult to scrap by subsequent administrations than was the Iran nuclear deal, which was an executive action by President Obama. And clearly the statements by Graham, Makovsky and Ruhe reveal this treaty would serve as a green light for an Israeli attack on Iran, should they opt to do so, while also serving as a red light to Tehran vis-à-vis an ironclad US commitment to “defend” Israel that would serve to discourage any serious Iranian retaliation. Given that dynamic, the treaty would be little more than a one-way security guarantee from Washington to Jerusalem.
Furthermore, in outlining what circumstances would trigger US intervention on Israel’s behalf, the JINSA/Graham document cites, inter alia, “the threat or use of weapons of mass destruction.” It also allows Netanyahu to call for assistance after defining as threatening any incident or development “that gives rise to an urgent request from the Government of Israel.” It appears then that Netanyahu could demand that the US attack Iran should he only perceive a threat, however vague that threat might in reality be.
Israeli Prime Minister Benjamin Netanyahu has been claiming Iran is “three to five years” and “possibly weeks” away from a nuclear weapons capability since 1992 and pushing Washington to attack Iran so he obviously would welcome such a treaty for strategic reasons as well as to shore up his upcoming re-election bid. President Trump, with whom Graham has discussed how the agreement would work, has a similar interest in appearing strong for Israel to help his own campaign in 2020.
It is worth noting that in 2010 Netanyahu ordered the Israel Defense Force (IDF) to prepare to strike Iran but ‘Israel’s security chiefs refused: Gabi Ashkenazi, the head of the IDF, and Meir Dagan, the head of the Mossad at the time, believed that Netanyahu and the Defense Minister Ehud Barak were trying to “steal a war” and the order was not carried out. The attacks were also rejected by two ministers, Moshe Yaalon and Yuval Steinitz, which left Netanyahu without the necessary majority to proceed.
Ashkenazi claimed in a 2012 interview about the episode that he was convinced that an attack would be have been a major strategic mistake. Meir Dagan said in 2012, after leaving his role as Mossad chief, that a strike would be “a stupid thing” as the entire region would undoubtedly be destabilized, requiring repeated Israeli and American interventions.
And there are other issues arising from a “defense treaty.” Defense means just that and treaties are generally designed to protect a country within its own borders. Israel has no defined borders as it is both expansionistic and illegally occupying Palestinian land, so the United States would in effect be obligated to defend space that Israel defines as its own. That could mean almost anything. Israel is currently bombing Syria almost daily even though it is not at war with Damascus. If Syria were to strike back and Graham’s treaty were in place, Washington would technically be obligated to come to Israel’s assistance. A similar situation prevails with Lebanon and there are also reports that Israel is bombing alleged Iranian supply lines in Iraq, where the US has 5,000 troops stationed.
The real problem is that the Trump administration is obsessed with regime change in Iran, but it has so far been unable to provoke Iran into starting a conflict. Graham’s proposed treaty just might be part of a White House plan to end-run Congress and public opinion by enabling Israel to start the desired war, whereupon the US would quickly follow in to “defend Israel,” obliged by treaty to do so. What could possibly go wrong? The correct answer is “everything.”
Despite interest rates having bounced (albeit very modestly) in the last few days, prompting shrieks of "the lows for yields are in" once again, and hyped-up belief that 'There Is No Alternative' to dumping bonds and buying stocks at record highs, Hayman Capital fund manager Kyle Bass has a different view suggesting that a global re-awakening of easier-and-easier monetary policy will drive US rates to zero (and potentially beyond).
"This is insane. The Japanese are going to keep going. The Chinese print money like it’s a national pastime today. Europe is going to restart QE."
During an interview with CNBC, Bass exclaimed:
“We’re the only country that has an integer in front of our bond yields,”
“We have 90% of the world’s investment-grade debt. We actually have rule of law and we have a decent economy. All the money is going to come here.”
For now, it appears that money is buying bonds AND stocks...
Which, Bass notes, will spark even more inequality (as 'assetholders' get richer - in ever more diluted dollar terms while the rest suffer from inflationary living costs)
"The unintended consequences of central bank printing are that it makes the rich even richer, it makes the middle class stay where they are and it makes the poor stay poor."
Bass also noted that he does not think a China trade deal is anywhere in sight.
“I think Trump’s political calculus is to keep talking. If he does a deal, it will be too easy and he’ll get attacked from the right. If he does a deal that’s too difficult, they won’t sign it.”
Watch the full interview below:
With the resignation of Prime Minister Giuseppe Conte the future of Italy is now up in the air. There are many things that come into play with Conte resigning before the No-Confidence vote tabled by Lega Leader Matteo Salvini could take place.
The euro popped 40 pips, back above support at $1.11 on the news. The forex markets realize this was a Brussels-friendly move.
Conte didn’t want to chance getting voted out of office. That makes it difficult for President Sergei Mattarella to call for a new government without snap elections. The Italian Senate would have formally rebuked Mattarella’s compromise pick for Prime Minister, Conte.
Conte was there to effectively keep the children in line – Euroskeptics Lega and Five Star Movement (M5S). So, Conte used his time to take the bully pulpit and excoriate Salvini for twenty minutes. This gives the U.S. and European media plenty of chum to make their case against Salvini.
You will hear a lot about how non-partisan Conte did this for the sake of Italy to stop the mad, selfish and unprofessional Salvini from taking power.
It’s good political theater but it’s as disingenuous as the day is long and very much the truth. No one in power in Brussels wants what Salvini is selling. Not many in Rome do either.
Because had he not resigned Mattarella could have faced impeachment for not going to elections. He only relented to let M5S and Lega take power under that threat last year.
So Conte has set the stage for Mattarella to take charge again. They will put the veneer of legitimacy on this process to protect Italy from Salvini. In reality, the only people they are protecting are in Brussels.
Remember, Salvini wants to circumvent EU budget controls through issuing the mini-BOT parallel currency. And current polling puts him at just below the threshold to take power outright.
The downstream effects of this are myriad but there is one big fulcrum on which this hinges.
M5S Leader Luigi Di Maio is now placed to play kingmaker. He can either do a deal with Matteo Renzi and the Democrats (PD), who M5S was formed to oust from power, or he can drag things out to attack Salvini for putting Italy in turmoil and hope for the best in an election.
Mattarella will push for a caretaker government to keep Salvini from power and marginalize M5S as much as possible. The goal is to forestall elections for as long as possible.
That latter path leads to Di Maio trying to shift opinion polls back on his side. Not likely, but hey, deluded people try to manipulate events against the trend all the time.
Salvini forced this crisis because of his persuading the Italian people that not only his future plans are better but so would be his leadership. The coalition has been stymied by both Conte and M5S and M5S’s poll numbers reflect their mission creep.
When that fails, Di Maio will have to make a deal with PD or face elections which will see M5S out of power.
And if he makes that deal, which Brussels and Rome want him to bit one, it will be the beginning of the end of M5S.
But Di Maio is now in the same position that another reformer turned toady was in after he betrayed his country in 2015, Greece’s Alexis Tsipras.
To remind everyone, Tsipras is now out of a job and one of the most hated people in Greece. So complete was his sell out of the Greek people, he ushered back into power a center-right government in July.
Five Star was born out of the disgust Italians had for its leadership in Rome and the technocratic overthrow of Silvio Berlusconi’s government back in 2011.
It was a pure protest party, especially when Beppe Grillo was its figurehead. Now, it’s making deals to stay in power with those same technocrats.
Di Maio has to think very carefully about where things go from here.
Salvini is still in the driver’s seat because a betrayal by M5S of that nature will see Italy ground into a paste. Look no farther than the English Channel to see what Brussels wants to to do the Brits over Brexit. IF you think Italy will be spared after their dalliance with insurrection you are terminally naive.
And Salvini not being a part of that works to his advantage going forward. Sometimes the best way to win a battle is to retreat and let your enemies over-extend themselves.
Di Maio wasn’t a strong enough leader to keep the disparate factions within M5S on mission. He will now pay the price for his lack of vision.
* * *
At a moment that Iran and the US/UK are effectively already at war on the open seas in an ongoing "tanker war," Tehran is set to unveil a new Iran-manufactured long range air-defense missile system which could rival Russia's S-300 system.
Citing state media, the Associated Press described "the Bavar-373 is a long-range surface-to-air missile system able to recognize up to 100 targets at a same time and confront them with six different weapons."
Iran's semi-official Fars news agency indicated the system will be fully unveiled in a ceremony on Thursday, on the occasion of the country's "Defense Industries day".
The Iranian military has been increasingly reliant on its burgeoning domestic defense manufacturing industry in the face of crippling US sanctions. Since the early 1990's it's been able to develop tanks, submarines, and light and heavy munitions, and more recently touted an Iran-build stealth warship.
State media called the soon to be revealed Bavar-373 system a "deterrence against threats" uniquely produced domestically due to the "continuous sanctions imposed by the enemies" of the Islamic Republic. The first footage of the system was released Tuesday through state sources ahead of Thursday's unveiling ceremony.
Russian aviation publication Avia.Pro claimed early this week that the Iranian system is “superior” to the S-300. It's reportedly been undergoing testing since 2017, but it's unclear how quickly it will actually be deployed into operation.
“The Iranian Bavar-373 radars can detect air targets at distances of up to 300 kilometers, and, in addition to aircraft, the radar is able to detect cruise and ballistic missiles, as well as small drones,” the publication stated, according to a translation.
“According to unconfirmed data, the radar is also capable of detecting stealth aircraft, which makes it an effective means of combating F-22 and F-35 fighters, which, incidentally, were recently discovered near the Iranian borders,” the report said further.
And separately, the AP acknowledged:
The system could be a competitor to Russia’s S-300 missile system.
No doubt the timing of this week's unveiling is calculated as a message to Washington, and as a warning that sanctions will only increase Iran's domestic-produced defense capabilities.
As the Russiagate circus attempts to quietly disappear over the horizon, with Democrats preferring to shift the anti-Trump narrative back to "racist", "white supremacist", "xenophobe", and the mainstream media ready to squawk "recession"; the Trump administration may have a few more cards up its sleeve before anyone claims the higher ground in this farce we call an election campaign.
As The Hill's John Solomon details, in September 2018 that President Trump told my Hill.TV colleague Buck Sexton and me that he would order the release of all classified documents showing what the FBI, the Department of Justice (DOJ) and other U.S. intelligence agencies may have done wrong in the Russia probe.
And while it's been almost a year since then, of feet-dragging and cajoling and deep-state-fighting, we wonder, given Solomon's revelations below, if the president is getting ready to play his 'Trump' card.
Here are the documents that Solomon believes have the greatest chance of rocking Washington, if declassified:
1.) Christopher Steele’s confidential human source reports at the FBI. These documents, known in bureau parlance as 1023 reports, show exactly what transpired each time Steele and his FBI handlers met in the summer and fall of 2016 to discuss his anti-Trump dossier. The big reveal, my sources say, could be the first evidence that the FBI shared sensitive information with Steele, such as the existence of the classified Crossfire Hurricane operation targeting the Trump campaign. It would be a huge discovery if the FBI fed Trump-Russia intel to Steele in the midst of an election, especially when his ultimate opposition-research client was Hillary Clinton and the Democratic National Committee (DNC). The FBI has released only one or two of these reports under FOIA lawsuits and they were 100 percent redacted. The American public deserves better.
2.) The 53 House Intel interviews. House Intelligence interviewed many key players in the Russia probe and asked the DNI to declassify those interviews nearly a year ago, after sending the transcripts for review last November. There are several big reveals, I’m told, including the first evidence that a lawyer tied to the Democratic National Committee had Russia-related contacts at the CIA.
3.) The Stefan Halper documents. It has been widely reported that European-based American academic Stefan Halper and a young assistant, Azra Turk, worked as FBI sources. We know for sure that one or both had contact with targeted Trump aides like Carter Page and George Papadopoulos at the end of the election. My sources tell me there may be other documents showing Halper continued working his way to the top of Trump's transition and administration, eventually reaching senior advisers like Peter Navarro inside the White House in summer 2017. These documents would show what intelligence agencies worked with Halper, who directed his activity, how much he was paid and how long his contacts with Trump officials were directed by the U.S. government’s Russia probe.
4.) The October 2016 FBI email chain. This is a key document identified by Rep. Nunes and his investigators. My sources say it will show exactly what concerns the FBI knew about and discussed with DOJ about using Steele’s dossier and other evidence to support a Foreign Intelligence Surveillance Act (FISA) warrant targeting the Trump campaign in October 2016. If those concerns weren’t shared with FISA judges who approved the warrant, there could be major repercussions.
5.) Page/Papadopoulos exculpatory statements. Another of Nunes’ five buckets, these documents purport to show what the two Trump aides were recorded telling undercover assets or captured in intercepts insisting on their innocence. Papadopoulos told me he told an FBI undercover source in September 2016 that the Trump campaign was not trying to obtain hacked Clinton documents from Russia and considered doing so to be treason. If he made that statement with the FBI monitoring, and it was not disclosed to the FISA court, it could be another case of FBI or DOJ misconduct.
6.) The 'Gang of Eight' briefing materials. These were a series of classified briefings and briefing books the FBI and DOJ provided key leaders in Congress in the summer of 2018 that identify shortcomings in the Russia collusion narrative. Of all the documents congressional leaders were shown, this is most frequently cited to me in private as having changed the minds of lawmakers who weren’t initially convinced of FISA abuses or FBI irregularities.
7.) The Steele spreadsheet. I wrote recently that the FBI kept a spreadsheet on the accuracy and reliability of every claim in the Steele dossier. According to my sources, it showed as much as 90 percent of the claims could not be corroborated, were debunked or turned out to be open-source internet rumors. Given Steele’s own effort to leak intel in his dossier to the media before Election Day, the public deserves to see the FBI’s final analysis of his credibility. A document I reviewed recently showed the FBI described Steele’s information as only “minimally corroborated” and the bureau’s confidence in him as “medium.”
8.) The Steele interview. It has been reported, and confirmed, that the DOJ's inspector general (IG) interviewed the former British intelligence operative for as long as 16 hours about his contacts with the FBI while working with Clinton’s opposition research firm, Fusion GPS. It is clear from documents already forced into the public view by lawsuits that Steele admitted in the fall of 2016 that he was desperate to defeat Trump, had a political deadline to make his dirt public, was working for the DNC/Clinton campaign and was leaking to the news media. If he told that to the FBI and it wasn’t disclosed to the FISA court, there could be serious repercussions.
9.) The redacted sections of the third FISA renewal application. This was the last of four FISA warrants targeting the Trump campaign; it was renewed in June 2017 after special counsel Robert Mueller’s probe had started, and signed by then-Deputy Attorney General Rod Rosenstein. It is the one FISA application that House Republicans have repeatedly asked to be released, and I’m told the big reveal in the currently redacted sections of the application is that it contained both misleading information and evidence of intrusive tactics used by the U.S. government to infiltrate Trump’s orbit.
10.) Records of allies’ assistance. Multiple sources have said a handful of U.S. allies overseas – possibly Great Britain, Australia and Italy – were asked to assist FBI efforts to check on Trump connections to Russia. Members of Congress have searched recently for some key contact documents with British intelligence. My sources say these documents might help explain Attorney General Bill Barr’s recent comments that “the use of foreign intelligence capabilities and counterintelligence capabilities against an American political campaign, to me, is unprecedented and it's a serious red line that's been crossed.”
These documents, when declassified, would show more completely how a routine counterintelligence probe was hijacked to turn the most awesome spy powers in America against a presidential nominee in what was essentially a political dirty trick orchestrated by Democrats.