by Zero Hedge - February 20th, 2017 5:00 pm
President Dwight Eisenhower’s warning about the dangers of the military-industrial complex made half a century ago ring as loud and clear today. The soft coup being mounted against the Trump government by America’s ‘deep state’ reached a new intensity this week as special interests battled for control of Washington.
The newly named national security advisor, Lt Gen Michael Flynn, was ousted by Trump over his chats with Russia’s ambassador and what he may or may not have told Vice President Pence. The defenestration of Flynn appeared engineered by our national intelligence agencies in collaboration with the mainstream media and certain Democrats.
Flynn’s crime? Talking to the wicked Russians before and after the election. Big, big deal. That’s what security advisors are supposed to do: keep an open back channel to other major powers and allies. This is also the job of our intelligence agencies.
There is no good or bad in international affairs. The childish concept of ‘good guys’ and ‘bad guys’ comes from the Bush era when simple-minded voters had to be convinced that America was somehow in grave danger from a bunch of angry Mideast goat herds.
The only nations that could threaten America’s very existence are nuclear powers Russia, China, India, France, Britain and Israel (and maybe Pakistan) in that order.
Russia has thousands of nuclear warheads targeted on the US mainland. Any real war with Russia would invite doom for both nations. Two near misses are more than enough. Remember the 1962 Cuban missile confrontation and the terrifying 1983 Able Archer scare – near thermonuclear war caused by Ronald Reagan’s anti-Russian hysteria and Moscow’s panicked response.
Margolis’ #1 rule of international relations: make nice and keep on good terms with nations that have nuclear weapons pointed at you. Avoid squabbles over almost all matters. Intelligence agencies play a key role in maintaining the balance of nuclear terror and preventing misunderstandings that can cause war.
Gen. Flynn was a fanatical anti-Islamic wing nut. He was, to use Trumpese, a bigly terrible choice. I’m glad he is gone. But Flynn’s sin was being loopy, not talking on the phone to the Russian ambassador. The White House and national intelligence should be talking every day to Moscow, even ‘hi Boris, what’s new with you guys? ‘Nothing
by Zero Hedge - February 20th, 2017 4:43 pm
Trump Is Playing You
Note: Soren K is a group of 4 writers to whom I contribute on commodity market posts-Vince Lanci
There is one thing Hillary and Donald agree on. You are idiots. She said it. He thinks it. In fact the voting populace is largely brain damaged. And those who aren’t quite vegetables yet will become pacified with iphones, slot machines, and skinner boxes designed to wither their ability to make decisions. Look it up. No wait, we did it for you. Click to scroll. You are too busy alternatively being pacified or outraged.
Trump is About Trump. You will be a captive client to US sub par products made by corporations with all the rights of people, without the social contract. They will be subsidized, favored, given carve-outs etc. Carrier was given money to stay in the US. That money is going to make their plants more efficient. They will do this via more automation. Translation: Trump just got you fired. How does Trump feel about it? It was going to happen anyway, why shouldn’t he benefit from it? Then the corporations will want more measures to keep the American consumer captive. Enter wealth confiscators from the Globalist Left and the Corporatist Right.
This is a false quote, but Trump’s actions do not show a much different perspective.
Still Just Rats in a Cage
Part of making you compliant is removing your economic freedom. The wall is being built to keep you IN. That means choices need to be limited. Like using alternative means of payment. Liberal Globalists will champion it. Conservative Corporatists will profit from it. 1 party rule
You have 100 choices of toothpaste now, but you will only be able to buy them here soon. The Ruling Class tools are monetary policy,indebtedness, inflation, tariffs, and co-opting alternative stores of wealth like Gold. If they can’t co-opt your Gold, they will debase it.
They won’t confiscate your Gold this time. No. They will tax it. They will force you to CUSIP it. They will reduce its collateral value for loans. They will prohibit IRA ownership in home safes.
IRS Warns Against Keeping IRA Funds in Gold at Home
September 5, 2016Wall St.JournalThe Internal Revenue Service isn’t too
by Zero Hedge - February 20th, 2017 4:42 pm
Despite record gluts in crude and gasoline amid resurgent US crude production, hedge funds boosted their net long position in WTI last week to a new record high.
The International Energy Agency said the group has achieved a record 90 percent initial compliance with an output accord, and as Bloomberg notes, it seems hedge funds are loving te fact that OPEC has never been more serious.
After some hesitation in the previous week, it was the fifth time this year that they’ve upped their bullish stance, and the third they took it to a new record.
In fact, as Bloomberg reports, for the first time ever, hedge funds hold more than a billion barrels of bets that crude oil prices will rally.
“The OPEC cuts so far are a little bigger than expected and there’s no sign that they are backing down,” Mike Wittner, head of commodities research at Societe Generale SA in New York, said by telephone. “This feeds into expectations that we’re heading into a balanced market.”
“Money managers have confidence that there will be either a further, ongoing investor flow that will keep prices elevated, OPEC cuts will continue and start reducing inventories, or increased demand will reduce supply in the second half of the year,” Tim Evans, an energy analyst at Citi Futures Perspective in New York, said by telephone.
But as Raoul Pal detailed previously, look at the term structure of crude oil. We’ve got a fairly steep contango for a few months but then we see backwardation in the belly of the curve. So apparently, we’re not going to need storage after June or July or so it’s going to be a non-issue those tanks are going to be empty. I’m not buying that story.
So I do see a curve steepener trade that is-- I actually just bought a bunch of spreads short June, long December. Just thinking that at that point there was backwardation in that segment of the curve I don’t think that’s going to stay in backwardation I think by the time June gets here we’re going to be looking at contango again.
So that’s one trade that I see the other one I’m kind of waiting for and I’m lining up quite a few dominoes here is I think that Trump is going
by Zero Hedge - February 20th, 2017 4:32 pm
On Sunday we reported that concerns have spread in Europe about a potential nuclear “incident” following a recent report by a French nuclear watchdog agency – the Institute for Radiological Protection and Nuclear Safety (IRSN), the French national public expert in nuclear and radiological risks – that radioactive Iodine-131 had been observed across much of northern and central Europe. Since the isotope has a half-life of only eight days, the detection was an indication of a rather recent release. As the Barents Observer added, “where the radioactivity is coming from is still a mystery.”
The emission was rumored to have originated close to the Arctic circle, with some speculating that a nuclear test of emergency had taken place in Russia in January and the fallout then spread to Norway and onward to Europe:
“Iodine-131 a radionuclide of anthropogenic origin, has recently been detected in tiny amounts in the ground-level atmosphere in Europe. The preliminary report states it was first found during week 2 of January 2017 in northern Norway. Iodine-131 was also detected in Finland, Poland, Czech Republic, Germany, France and Spain, until the end of January”, the French Institute de Radioprotection et de Süreté Nucléaire wrote in a press release.
Adding an air of mystery to this alleged “incident” was the spotting of the “Constant Phoenix”, which as we first reported, arrived on Friday in the UK’s Mildenhall airbase from Florida. The WC-135 Constant Phoenix has been used in the past to determine whether nuclear tests or detonations have taken place in any given region. The WC-135 is a derivative of the Boeing C-135 transport and support plane. Two of these aircraft are in service today out of the ten examples operated since 1963. The aircraft are flown by flight crews from the 45th Reconnaissance Squadron from Offutt Air Force Base while mission crews are staffed by Detachment 1 from the Air Force Technical Applications Center.
The WC-135, known as the “sniffer” or “weather bird” by its crews, can carry up to 33 personnel. However, crew compliments are kept to a minimum during mission flights in order to lessen levels of radioactive exposure.
Today, as a result of public demands for answers in this unpleasant “mystery”, the IRSN provided this update on its twitter account:
by Zero Hedge - February 20th, 2017 4:13 pm
While Donald Trump has been consumed by concerns of halting dangerous foreigners from entering the US, the opposite happened on Monday morning, when eleven people walked through an unscreened security lane at John F. Kennedy International Airport in New York and reprotedly boarded flights to unknown destinations, officials told NBC News. In a total breakdown of security protocol, none of the 11 were checked by Transportation Safety Administration personnel, an airport official and senior law enforcement official said.
The TSA said in a statement that three passengers may not have been rescreened after they set off metal detectors. A senior law enforcement official with direct knowledge of the incident told NBC News that there was surveillance video of the three setting off the alarms.
The security lapse occurred at the Jet Blue terminal in Terminal 5, when the TSA opened a screening lane shortly after 6 a.m. yet failed to immediately assign screeners. “The screening lane was unmanned, but passengers didn’t know, so they started going through it,” a source said.
The TSA did not notify police for two hours, an apparent violation of protocol that requires immediate notification of the Port Authority Police Department. The sources said the TSA and the Port Authority then canvassed the JetBlue terminal using photos and video screen grabs but could not locate any of the 11 passengers.
“They boarded any number of unknown aircraft to unknown destinations,” a source told the NY Post. “And the biggest problem is TSA took two hours to notify the Port Authority.”
To ease concerns about the breach, however, The TSA said it was “confident” that the incident posed no threat and said those found responsible would be disciplined and retrained “as appropriate.” Furthermore, since no flights were grounded, it is clear that authorities did not consider the incident to be sufficiently threatening.
An airport official said the security canvass was completed at 9:05 a.m. and both officials said the passengers are assumed to have boarded flights. The Port Authority of New York and New Jersey did not return a call for comment.
by Zero Hedge - February 20th, 2017 4:00 pm
Media junkies on the tragic path to extinction believe the junk news, non-junkies see through the manipulation.
The mainstream media continues peddling its “fake news” narrative like a desperate pusher whose junkies are dying from his toxic dope. It’s slowly dawning on the media-consuming public that the MSM is the primary purveyor of “fake news”-- self-referential narratives that support a blatantly slanted agenda with unsupported accusations and suitably anonymous sources.
Many of these Fake News Narratives are laughably, painfully bogus: that President Trump is a Russian tool, to take a current example. (That President Obama was a tool of the neocon Deep State--no mention of that. According to the MSM, America doesn’t even have a Deep State--har-har…the joke’s on you if you are credulous enough to swallow this risible absurdity.)
But the real danger isn’t fake news--it’s junk news. Junk News (the title of a 2009 book by an Emmy Award–winning journalist-- Junk News: The Failure of the Media in the 21st Century) --is related to Junk Science and Junk Food.
Junk science is presented as “science” but cherry-picks data to support a specific but unstated agenda--an agenda that requires downplaying or overlooking conflicting data.
One common example of junk science is the approval of new medications by the FDA. If you actually dig into Phase III data, you may well find that the “benefits” of the new wonder-drug are barely above statistical chance, and the potential interactions with commonly prescribed (or imbibed) drugs are ignored.
This is how we end up with medications with an unfortunate side-effect: death from misadventure, addiction, in combination with other commonly prescribed meds, etc.
(For more junk science, check out how meds going off-patent magically get FDA approval for additional --and immensely profitable-- patent protection.)
Junk food is now so ubiquitous we lose sight of its core qualities: it is “food” in the sense of being digestible, but it is harmful above very small, occasional doses. It is not “food” in the context of natural food or healthy food--in those contexts, “junk food” must be placed in parentheses because it doesn’t qualify as “food.”
It is empty calories, garbage that generates a host of chronic illnesses, but not “food” in the sense of being nutritious, life-supporting or healthy.
Junk news is like
by Zero Hedge - February 20th, 2017 3:28 pm
As John Rubino eloquently puts it, “when the history of these times is written, former Fed Chair Alan Greenspan will be one of the major villains, but also one of the greatest mysteries. This is so because he has, in effect, been three different people.” Greenspan started his public life brilliantly, as a libertarian thinker who said some compelling and accurate things about gold and its role in the world. An example from 1966: “This is the shabby secret of the welfare statists’ tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists’ antagonism toward the gold standard.”
Yet everything changed a few decades later when Greenspan was put in charge of the Federal Reserve in the late 1980s, instead of applying the above wisdom, for example by limiting the bank’s interference in the private sector and letting market forces determine winners and losers, he did a full 180, intervening in every crisis, creating new currency with abandon, and generally behaving like his old ideological enemies, the Keynesians. Predictably, debt soared during his long tenure.
Along the way he was also instrumental in preventing regulation of credit default swaps and other derivatives that nearly blew up the system in 2008. His view of those instruments:
The reason that growth has continued despite adversity, or perhaps because of it, is that these new financial instruments are an increasingly important vehicle for unbundling risks. These instruments enhance the ability to differentiate risk and allocate it to those investors most able and willing to take it. This unbundling improves the ability of the market to engender a set of product and asset prices far more calibrated to the value preferences of consumers than was possible before derivative markets were developed. The product and asset price signals enable entrepreneurs to finely allocate real capital facilities to produce those goods and services most valued by consumers, a process that has undoubtedly improved national productivity growth and standards of living.
In the aftermath of the dot com crisis Greenspan cut interest rates to near-zero in the early 2000s, igniting the
by Zero Hedge - February 20th, 2017 3:03 pm
In a brief statement from Mar-a-Lago, President Trump has confirmed retired Lt. General H.R. McMaster as his national security adviser.
BREAKING: Trump picks retired Gen. H.R. McMaster as next national security adviser https://t.co/BHiYnKtXJe
— NBC News (@NBCNews) February 20, 2017
Foreign Policy’sThomas Ricks says, picking McMaster is not a bad thing. I’ve known him since he was major. He’s smart, energetic, and tough. He even looks like an armored branch version of Harward. (That’s him, working out with a punching bag in Iraq, in the foto. I took it in the citadel in downtown Tell Afar one sunny winter day about 10 years ago.) (Btw, Harward was scheduled to appear on ABC’s “This Week” yesterday morning, but backed out an hour before airtime. )
As I said at the end of my Friday post, once Trump was turned down by Harward, it became more likely that he would turn to the active duty military for his 3rd pick for the job. McMaster is among the best of them out there. For his Ph.D. dissertation, he wrote one of the best books on the Vietnam War, Dereliction of Duty: Johnson, McNamara, the Joint Chiefs of Staff, and the Lies That Led to Vietnam.
He has good combat experience, he was a good trainer, and he led the 3rd Armored Cavalry Regiment well in his deployment to Iraq, most notably in pacifying Tell Afar, to the west of Mosul.
I wrote about his operations there in my book The Gamble. I am traveling so I don’t have it with me, but I remember him telling his soldiers that understanding counterinsurgency really wasn’t hard: “Every time you disrespect an Iraqi, you’re working for the enemy.” They even had “Customer Satisfaction Forms” that detainees were asked to fill out upon release: Were you treated well? How was the food? What could we do better?
There are two big differences between him and Harward: First, he is on active duty. (Though the Army inexplicably couldn’t find a four star job for him, and had told him to plan to retire later this year.) Second, his wife won’t kill him if he takes the job, as Harward’s wife might have.
That said, the basic problems remain. To do the job right, McMaster needs to bring in his own
by Zero Hedge - February 20th, 2017 3:03 pm
In a brief statement from Mar-a-Lago, President Trump said on Monday that Lieutenant General Herbert Raymond McMaster would be his new national security adviser, again turning to the U.S. military to play a central role on his foreign policy team. Trump also named Keith Kellogg, a retired U.S. Army General who has been serving as the acting national security adviser, as chief of staff to the National Security Council.
Speaking to reporters in West Palm Beach where he spent the weekend, Trump said John Bolton, a former U.S. ambassador to the United Nations, would serve the administration in another capacity. Trump spent the weekend considering his options for replacing Flynn. His first choice, retired Vice Admiral Robert Harward, turned down the job last week.
BREAKING: Trump picks retired Gen. H.R. McMaster as next national security adviser https://t.co/BHiYnKtXJe
— NBC News (@NBCNews) February 20, 2017
McMaster is a highly regarded military tactician and strategic thinker, but his selection surprised some observers who wondered how McMaster, who is known for questioning authority, would deal with a White House that has not welcomed criticism, Reuters wonders. He replaces a Trump loyalist. Michael Flynn, a retired Army lieutenant general, was fired as national security adviser on Feb. 13 after reports emerged that he had misled Vice President Mike Pence about speaking to Russia’s ambassador about U.S. sanctions before Trump’s inauguration.
McMaster, 54, is a West Point graduate known as “H.R.,” with a PhD in U.S. history from the University of North Carolina at Chapel Hill. He was listed as one of Time magazine’s 100 most influential people in 2014, partly because of his willingness to buck the system. A combat veteran, he gained renown in the first Gulf War – and was awarded a Silver Star – after he commanded a small troop of the U.S. 2nd Army Cavalry Regiment that destroyed a much larger Iraqi Republican Guard force in 1991 in a place called 73 Easting, for its map coordinates, in what many consider the biggest tank battle since World War Two.
As one fellow officer put it, referring to Trump’s inner circle of aides and speaking on condition of anonymity, the Trump White House “has its own Republican Guard, which may be harder for him to
by Zero Hedge - February 20th, 2017 3:00 pm
Toshiba, the venerable 80 year old Japanese electronics giant, appears to be going bankrupt.
Toshiba was supposed to have announced at least $6.3 billion in losses during an earnings call yesterday. Instead, it cancelled the report, saying ”it was not able to immediately secure the approval of its auditor.”
Financial Times reports that “The delay to publication of Toshiba’s earnings came as the company said lawyers were examining claims by a whistleblower in the US that Westinghouse mishandled its takeover of Stone & Webster.”
Toshiba’s losses stem from its construction of new nuclear plants in the United States.
The collapse of Toshiba will result in the halting of all new nuclear power plant construction by its US-based subsidiary, Westinghouse.
Toshiba’s failure also raises the question of what happens to the Vogtle plants if Toshiba fails? Does it open two southeastern U.S. utilities — Southern and SCANA — up to exposure to Toshiba shareholder lawsuits? And who will build future U.S. nuclear plants?
How Bad Is It?
The loss estimate is already $2.6 billion higher than the estimate Toshiba gave in December, and could go higher.
The reason it could go higher is that nobody knows how long it will take to finish the U.S. plants, which are three years behind schedule and billions over budget.
Toshiba as recently as last June had as its goal the construction of 45 nuclear reactors around the world, including two in the UK, six in India, and possibly two more in Georgia, all using Westinghouse’s design, the AP-1000. Future Westinghouse reactors will either be built by some other company or not at all.
Toshiba’s last auditor, Ernst and Young, was fined $17.5 million in 2015 after failing to blow the whistle on an accounting scandal. In January, Japanese prosecutors charged that Toshiba executives exaggerated profits by $339 million over three years.
The announcement comes less than two years after the $5.3 billion bail-out by the French government of Areva, its state-owned nuclear company, currently undergoing a massive reorganization.
Nuclear energy is, simply, in a rapidly accelerating crisis:
· Demand for nuclear energy globally is low, and the new reactors being built may not keep up with the closure of nuclear plants around the world. Half of all U.S.