http://www.zerohedge.com/fullrss2.xml/%2A%7CARCHIVE%7C%2A en Frontrunning: January 20 http://www.zerohedge.com/news/2017-01-20/frontrunning-january-20 <ul> <li>How Trump Aims to Broadly Reshape Policy (<a href="http://www.wsj.com/articles/donald-trumps-presidency-a-look-at-his-proposed-policy-shifts-1484908203">WSJ</a>)</li> <li>Trump Calls for Unity at Opening Concert as Inaugural Festivities Begin (<a href="https://www.nytimes.com/2017/01/19/us/politics/donald-trump-inauguration.html?_r=0">NYT</a>)</li> <li>Trump Takes the Reins of a Deeply Divided Nation (<a href="https://www.bloomberg.com/politics/articles/2017-01-20/trump-takes-reins-of-nation-as-divisions-deprive-him-a-honeymoon">BBG</a>)</li> <li>Washington braces for anti-Trump protests, New Yorkers march (<a href="http://www.reuters.com/article/us-usa-trump-protests-idUSKBN1531GH">Reuters</a>)</li> <li>After the Parties, a Protest for the Ages (<a href="http://www.wsj.com/articles/after-the-parties-a-protest-for-the-ages-1484908215">WSJ</a>)</li> <li>Voter Anxiety That Fueled Trump’s Victory Turns to Hope (<a href="http://www.wsj.com/articles/voter-anxiety-that-fueled-trumps-victory-turns-to-hope-for-jobs-1484821805">WSJ</a>)</li> <li>Pageantry, protests to mark the start of Trump's presidency (<a href="http://www.reuters.com/article/us-usa-trump-inauguration-idUSKBN1540I0">Reuters</a>)</li> <li>For stock performance under Trump, don't look to prior transitions (<a href="http://www.reuters.com/article/us-usa-trump-inauguration-markets-idUSKBN1540I2">Reuters</a>)</li> <li>Bullion Bulls Have History on Their Side as Trump Takes Helm (<a href="https://www.bloomberg.com/news/articles/2017-01-19/gold-bulls-say-history-may-repeat-as-president-trump-is-sworn-in">BBG</a>)</li> <li>Yellen Backs Gradual Rate Rises as Fed Not Behind the Curve (<a href="https://www.bloomberg.com/news/articles/2017-01-20/yellen-says-fed-not-behind-the-curve-backs-gradual-rate-rises">BBG</a>)</li> <li>Doing Business With Putin (<a href="https://www.bloomberg.com/graphics/2017-putin-business">BBG</a>)</li> <li>Floor Caving In on Europe Real Estate Stocks Bashed by Rates (<a href="https://www.bloomberg.com/news/articles/2017-01-20/floor-caving-in-on-european-real-estate-stocks-pummeled-by-rates">BBG</a>)</li> <li>Republican Governors Balk as Congress Races to End Obamacare (<a href="https://www.bloomberg.com/news/articles/2017-01-19/republican-governors-balk-as-congress-races-to-kill-obamacare">BBG</a>)</li> <li>Telecommunications company Avaya files for bankruptcy (<a href="http://www.reuters.com/article/us-avaya-bankruptcy-idUSKBN1532JY">Reuters</a>)</li> <li>Finland Prepares for ‘Manifold Warfare’ as Russia Feeds Paranoia (<a href="https://www.bloomberg.com/politics/articles/2017-01-19/finland-prepares-for-manifold-warfare-as-russia-feeds-paranoia">BBG</a>)</li> <li>Samsung Blames Battery Size for Galaxy Note Fires (<a href="http://www.wsj.com/articles/samsung-investigation-blames-battery-size-for-galaxy-note-7-fires-1484906193">WSJ</a>)</li> <li>There's an Unexplained $9 Billion Gap in India's Cash Supply (<a href="https://www.bloomberg.com/news/articles/2017-01-19/mystery-9-billion-in-cash-with-indians-after-modi-s-shock-ban">BBG</a>)</li> <li>Turkey can no longer insist on Syria settlement without Assad: Turkish deputy PM (<a href="http://www.reuters.com/article/us-mideast-crisis-syria-turkey-idUSKBN1541IJ?il=0">Reuters</a>)</li> <li>Islamic State destroys famous monument in Syria's Palmyra: antiquities chief (<a href="http://www.reuters.com/article/us-mideast-crisis-syria-palmyra-idUSKBN1540X3?il=0">Reuters</a>)</li> <li>GE Meets Profit Estimates on Gains in Power, Aviation Units (<a href="https://www.bloomberg.com/news/articles/2017-01-20/ge-matches-profit-estimates-on-gains-in-power-aviation-units">BBG</a>)</li> <li>P&amp;G profit and sales beat Wall Street estimates (<a href="http://www.reuters.com/article/us-procter-gamble-results-idUSKBN1541L0?il=0">Reuters</a>)</li> <li>U.K. Retail-Sales Slump Hints at Cracks in Britain’s Brexit Boom (<a href="https://www.bloomberg.com/news/articles/2017-01-20/u-k-retail-sales-fall-most-since-2012-as-store-prices-rise">BBG</a>)</li> <li>U.S. Oil Producers Ramp Up Spending (<a href="http://www.wsj.com/articles/u-s-oil-producers-ramp-up-spending-1484908206">WSJ</a>)</li> <li>Robot Crop Pickers Limit Loss of U.S. Farm Workers to Trump Wall (<a href="https://www.bloomberg.com/news/articles/2017-01-20/robot-crop-pickers-limit-loss-of-u-s-farm-workers-to-trump-wall">BBG</a>)</li> <li>Companies’ Job Pledges: Analyzing the Numbers (<a href="http://www.wsj.com/articles/the-trump-factor-in-companies-jobs-pledges-analyzing-the-numbers-1484863131">WSJ</a>)</li> <li>Lloyd’s of London Seeks Europe Base as May Backs Hard Brexit (<a href="https://www.bloomberg.com/news/articles/2017-01-20/lloyd-s-of-london-seeks-europe-base-as-may-signals-hard-brexit">BBG</a>)</li> </ul> <p>&nbsp;</p> <p><strong>Overnight Media Digest</strong></p> <p><em><span style="text-decoration: underline;">WSJ</span></em></p> <p>- Joaquin "El Chapo" Guzman, the drug lord who staged two spectacular escapes from maximum-security prisons in Mexico, has arrived in New York to face trial, U.S. officials said Thursday. <a href="http://on.wsj.com/2jeuWLl" title="http://on.wsj.com/2jeuWLl">http://on.wsj.com/2jeuWLl</a></p> <p>- A $1 billion financing deal with Chinese firms Shanghai Film Group Corp and Huahua Media promises Viacom Inc's struggling Paramount Pictures some much-needed funds and a foothold in the world's second-largest box-office market. <a href="http://on.wsj.com/2jeBNV7" title="http://on.wsj.com/2jeBNV7">http://on.wsj.com/2jeBNV7</a></p> <p>- A Chinese consortium led by China Oceanwide Holdings Group Co reached a deal to buy International Data Group Inc, the data and marketing company that also runs venture-capital firm IDG Ventures. <a href="http://on.wsj.com/2jevNMa" title="http://on.wsj.com/2jevNMa">http://on.wsj.com/2jevNMa</a></p> <p>- China's flagship state-owned chip maker Tsinghua Unigroup said it plans to build a $30 billion memory-chip factory in Nanjing, its latest investment as China moves to diminish its dependence on U.S. chip manufacturers. <a href="http://on.wsj.com/2jeE7LL" title="http://on.wsj.com/2jeE7LL">http://on.wsj.com/2jeE7LL</a></p> <p>- U.S. regulators closed a probe of a fatal crash involving a Tesla Motors Inc car driving itself, concluding the Silicon Valley auto maker's semi-automated technology didn't contain a safety defect. <a href="http://on.wsj.com/2jeEpSQ" title="http://on.wsj.com/2jeEpSQ">http://on.wsj.com/2jeEpSQ</a></p> <p>- JPMorgan Chase &amp; Co Chief Executive Jamie Dimon will receive $28 million in total compensation for 2016, up 3.7 percent - or $1 million - from 2015, according to a Thursday securities filing. <a href="http://on.wsj.com/2jezEsp" title="http://on.wsj.com/2jezEsp">http://on.wsj.com/2jezEsp</a></p> <p>- South Korea's Hyundai Merchant Marine Co Ltd said it will buy a fifth of the company that runs the biggest container terminal at Long Beach, Calif., the U.S.'s second-largest port. <a href="http://on.wsj.com/2jeCGNr" title="http://on.wsj.com/2jeCGNr">http://on.wsj.com/2jeCGNr</a></p> <p>- Uber Technologies Inc agreed Thursday to pay $20 million to resolve Federal Trade Commission allegations that it misled drivers about potential earnings and vehicle financing. <a href="http://on.wsj.com/2jev9Oy" title="http://on.wsj.com/2jev9Oy">http://on.wsj.com/2jev9Oy</a> </p> <p>&nbsp;</p> <p><em><span style="text-decoration: underline;">FT</span></em></p> <p>* President-elect Donald Trump said on Thursday that National Football League team owner Woody Johnson was "going to St. James," indicating he would assume the plum diplomatic post of U.S. ambassador to the United Kingdom.</p> <p>* Miner BHP Billiton Ltd,, its partner Vale SA and their jointly owned Samarco unit have agreed with Brazilian prosecutors on a June 30 deadline to settle billions of dollars in compensation claims stemming from an iron ore mine disaster in 2015.</p> <p>* Britain's biggest house builder Barratt said on Thursday its Chief Finance Officer Neil Cooper had left the firm by mutual agreement just over a year after he joined.</p> <p>* Sinn Fein's Martin McGuinness, a key figure throughout five decades of conflict and peace in Northern Ireland, said on Thursday he was bowing out of politics and would not lead his nationalist party into elections in March.</p> <p>&nbsp;</p> <p><em><span style="text-decoration: underline;">NYT</span></em></p> <p>- Joaquín Guzmán Loera, the notorious drug lord known as El Chapo, was extradited to the United States on Thursday night. nyti.ms/2iQWtBH</p> <p>- American law enforcement and intelligence agencies are examining intercepted communications and financial transactions as part of a broad investigation into possible links between Russian officials and associates of President-elect Donald Trump, including his former campaign chairman Paul Manafort. nyti.ms/2juYk0Q</p> <p>- Donald Trump arrived in Washington the day before his inauguration as the nation's 45th president in a swirl of cinematic pageantry but facing serious questions about whether his chaotic transition has left critical parts of the government dangerously short-handed. nyti.ms/2iI6ZQt</p> <p>- President-elect Donald Trump on Thursday chose Woody Johnson, the owner of the New York Jets football franchise, as his ambassador to Britain. nyti.ms/2iQShBQ</p> <p>- Federal auto-safety regulators said their investigation of the Tesla Motor's car found no defects in the system that caused a fatal accident eight months back and said Tesla's Autopilot-enabled vehicles did not need to be recalled. nyti.ms/2juVA3J</p> <p>- The political standoff in Gambia intensified on Thursday as foreign troops crossed the border with orders to dislodge a repressive leader who has refused to step down after losing a presidential election last month. nyti.ms/2jFtyoh</p> <p>&nbsp;</p> <p><em><span style="text-decoration: underline;">Canada</span></em></p> <p>THE GLOBE AND MAIL</p> <p>** The incoming Trump administration is ruling out an across-the-board border tax as it prepares a sweeping new trade agenda that includes renegotiating the North American free-trade agreement with Canada and Mexico. <a href="https://tgam.ca/2j11Gdg" title="https://tgam.ca/2j11Gdg">https://tgam.ca/2j11Gdg</a></p> <p>** Ottawa will consider adopting national guidelines for prescription heroin and other unconventional therapies to treat severe opioid addiction, looking to guidelines being developed by doctors in British Columbia, where such treatments are already available on a small scale. <a href="https://tgam.ca/2j12jUs" title="https://tgam.ca/2j12jUs">https://tgam.ca/2j12jUs</a></p> <p>** As an executive at Loblaw Companies Ltd, Sarah Davis helped steer the company through some of its toughest times. Now she is being rewarded with a promotion to president of Canada's largest grocer and drugstore retailer. <a href="https://tgam.ca/2j0Z67a" title="https://tgam.ca/2j0Z67a">https://tgam.ca/2j0Z67a</a></p> <p>NATIONAL POST</p> <p>** Starwood Capital Group is paying $2.85 billion to buy Milestone Real Estate Investment Trust, a TSX-listed company that focuses solely on U.S. residential properties. In the process, Canadian investors are losing one of the TSX's most significant direct plays on the U.S. real estate market. <a href="http://bit.ly/2j12D5C" title="http://bit.ly/2j12D5C">http://bit.ly/2j12D5C</a></p> <p>** Canadian Pacific Railway Ltd may be losing its legendary CEO to a competitor, but investors shrugged off the development Thursday, sending shares up as much as 4.2 per cent in morning trading. <a href="http://bit.ly/2j1b5BJ" title="http://bit.ly/2j1b5BJ">http://bit.ly/2j1b5BJ</a></p> <p>** Alberta Premier Rachel Notley shuffled her cabinet Thursday to carve out a new Children's Services ministry, citing ongoing problems keeping kids safe in government care. <a href="http://bit.ly/2j0Xdrc" title="http://bit.ly/2j0Xdrc">http://bit.ly/2j0Xdrc</a></p> <p>&nbsp;</p> <p><em><span style="text-decoration: underline;">Britain</span></em></p> <p>The Times</p> <p>Ofgem warns Big Six firms against raising energy prices</p> <p>Ofgem has issued a warning shot to the Big Six suppliers against raising prices, saying there was no "obvious reason" for them to increase standard tariffs. <a href="http://bit.ly/2jEWEUK" title="http://bit.ly/2jEWEUK">http://bit.ly/2jEWEUK</a></p> <p>The Guardian</p> <p>Rolls-Royce lobbied ministers to weaken anti-bribery proposals</p> <p>Rolls-Royce Holdings Plc, which this week agreed to pay 671 million pounds in penalties after admitting it had engaged in corruption, lobbied ministers to weaken proposed curbs on bribery a decade ago. <a href="http://bit.ly/2k6183s" title="http://bit.ly/2k6183s">http://bit.ly/2k6183s</a></p> <p>Goldman Sachs stalls plan to move jobs to UK amid Brexit uncertainty</p> <p>Goldman Sachs Group Inc has suspended plans to move key operations from the United States to London because of the uncertainty created by the vote to leave the EU. The Wall Street firm - in the midst of building a new 350 million pound London headquarters - had been preparing to shift more of its global operations and IT activities from New York, but now appears to have embarked on a hiring freeze. <a href="http://bit.ly/2ju22HT" title="http://bit.ly/2ju22HT">http://bit.ly/2ju22HT</a></p> <p>The Telegraph</p> <p>Barratt's chief financial officer leaves the company after just 15 months</p> <p>Barratt Developments Plc's chief financial officer is to leave the business a week after the house builder reported a sharp drop in the number of homes it built in London last year. Neil Cooper joined Barratt just 14 months ago, in November 2015, but has now left by mutual consent. Chief Executive David Thomas will stand in for Cooper until a successor can be found. <a href="http://bit.ly/2iPWNRe" title="http://bit.ly/2iPWNRe">http://bit.ly/2iPWNRe</a></p> <p>Glaxo's pharmaceuticals boss walks away as new chief prepares to take the helm</p> <p>One of GlaxoSmithKline Plc's most senior directors is leaving the company as incoming boss Emma Walmsley moves to refresh her team. Abbas Hussain, who has run Glaxo's sprawling pharmaceuticals division since 2008, has agreed to leave the FTSE 100 drugs giant later this year. <a href="http://bit.ly/2jEXEYN" title="http://bit.ly/2jEXEYN">http://bit.ly/2jEXEYN</a></p> <p>Sky News</p> <p>Southern railways to suffer more strike action</p> <p>Passengers on the Southern railway network face more delays next week after drivers and guards in the RMT union decided to press ahead with further strikes. The RMT said its members would be taking action because it has been excluded from talks between ASLEF and the company. <a href="http://bit.ly/2iOM21r" title="http://bit.ly/2iOM21r">http://bit.ly/2iOM21r</a></p> <p>Metro Bank creates 500 jobs in branch expansion</p> <p>Metro Bank Plc has announced plans to create 500 new jobs as it continues to expand its interests beyond London and the South East. The loss-making challenger bank, which first hit high streets a little over six years ago as major lenders juggled the damaging fallout from the financial crisis, said the new roles included customer-facing and head office positions. <a href="http://bit.ly/2jDoq3H" title="http://bit.ly/2jDoq3H">http://bit.ly/2jDoq3H</a> </p> <p>&nbsp;</p> http://www.zerohedge.com/news/2017-01-20/frontrunning-january-20#comments Bitly Business Business China Congress Corruption Donald Trump Donald Trump Donald Trump presidential campaign European Union Federal Trade Commission Finland FTSE 100 goldman sachs Goldman Sachs Ireland Jamie Dimon JPMorgan Chase Mexico National Football League New York Jets Obamacare Politics of the United States Real estate Reuters semi-automated technology Sinn Fein Starwood Stop Trump movement Trump Trump Administration TSX Turkey United Kingdom US Federal Reserve Viacom Fri, 20 Jan 2017 12:43:09 +0000 Tyler Durden 585951 at http://www.zerohedge.com Full Calendar Of Today's Washington Events http://www.zerohedge.com/news/2017-01-20/full-calendar-todays-washington-events <p>With markets focused on today's events in Washington, culminating with Trump's inaugural speech, here’s a look at the key scheduled events for Friday, Jan. 20 (all times Eastern). </p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/01/15/inauguration%201.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/01/15/inauguration%201_0.jpg" width="500" height="281" /></a></p> <p><strong>What to Watch </strong></p> <ul> <li>Inauguration of President-elect Donald Trump at U.S. Capitol</li> <li>Friday is a holiday for federal workers in the Washington area, economic data will be delayed</li> <li>Possible Trump executive actions</li> <li>Senate confirmation votes on Cabinet nominees</li> </ul> <p><strong>White House </strong></p> <ul> <li>9:45am: President Obama and first lady Michelle Obama host Trump and wife Melania for a tea and a small reception; depart White House for U.S. Capitol at 10:30am</li> <li>1:10pm: Obama delivers remarks at Joint Base Andrews farewell event</li> <li>1:40pm: Obama departs Joint Base Andrews for Palm Springs, Calif.</li> </ul> <p><strong>Official Inauguration Events</strong></p> <ul> <li>7am: Presidential Inaugural Prayer Breakfast; Trump International Hotel, Old Postal Pavilion Building, 1100 Pennsylvania Ave. NW</li> <li>8:30am: Trump and Vice President-elect Mike Pence to attend worship service hosted by Joint Congressional Committee on Inaugural Ceremonies; St. John’s Episcopal Church, 16th and H Streets NW</li> <li>11:30am: Inauguration ceremony begins at West Front of Capitol</li> <li>Noon: Trump takes oath of office</li> <li>12:30pm: Inaugural luncheon for members of Congress at Capitol</li> <li>3pm: Inaugural parade begins</li> <li>7pm: Presidential Inaugural Committee holds “Commander in Chief’s Ball”; Walter E. Washington Convention Center, 801 Mount Vernon Place NW</li> <li>7pm: Presidential Inaugural Committee hosts “Salute to Our Armed Services Ball”; National Building Museum, 401 F St. NW</li> </ul> <p><strong>Commentary on Trump's Speech</strong></p> <ul> <li>"All eyes will be on the content and style of Trump's inauguration speech," Morgan Stanley's Hans Redeker wrote in a note.&nbsp; "The more 'Presidential' this speech comes across, the better the outcome for markets."&nbsp; </li> <li>"[Trump is] likely to talk about job creation and unifying the U.S. and we may have to wait a bit longer for details on economic measures," said Natixis fixed income strategist Cyril Regnat.</li> <li>“It’s clear that investors have reached a level where they are prepared to wait and see what the Trump administration has to offer,” said Ric Spooner, chief market analyst at CMC Markets Asia Pacific Ltd. in Sydney.</li> <li>Trump’s inauguration ceremony “will be followed by a speech that will be carefully decoded by those looking for signs of things to come in the new U.S. administration, an exercise that amounts to political astrology in an era characterized by a shakeup of the old rules of the game,” Citigroup’s chief global political analyst Tina Fordham wrote in note</li> </ul> <p><strong>Congress</strong></p> <ul> <li>Senate to hold confirmation votes on some Cabinet nominees</li> <li>Democratic leader Chuck Schumer told reporters Thursday that Trump’s selection of retired Gen. James Mattis as secretary of Defense and retired Gen. John Kelly as secretary of Homeland Security will be considered</li> <li>3pm: Congressional Hispanic Caucus holds news conference with House Democratic leaders on immigration policy; 421 Cannon House Office Building</li> </ul> <p><strong>Other Events and Protest Activity</strong></p> <ul> <li>7am: Code Pink holds rally outside of Trump International Hotel; Old Postal Pavilion Building, 1100 Pennsylvania Ave. NW</li> <li>9:30am: Occupy Wall Street, Green Party, Code Pink hold protest at McPherson Square; 14th and I Streets NW</li> <li>10am: Bikers for Trump holds inauguration rally at John Marshall Park; Pennsylvania Ave. NW, between 4th and 5th</li> <li>7pm: National Museum of the American Indian holds “Native Nations Inaugural Ball”; Independence Ave. and 4th St. SW</li> <li>8pm: National Portrait Gallery and Smithsonian American Art Museum hold “The Great Gatsby Presidential Inaugural Ball”; National Portrait Gallery, 8th and F Streets NW</li> <li>8pm: NAACP’s Youth and College Division holds “Stay Woke and Fight People’s Inaugural Ball”; Vieux Carre, 1413 K St. NW</li> <li>9pm: The Creative Coalition holds “Inaugural Ball for the Arts”; Harman Center for the Arts, 610 F St. NW</li> </ul> <p><em>Source: Bloomberg</em></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="1600" height="900" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/inauguration%201.jpg?1484914334" /> </div> </div> </div> http://www.zerohedge.com/news/2017-01-20/full-calendar-todays-washington-events#comments Business Climate change skepticism and denial Congress Congress Senate Creative Coalition Donald Trump Donald Trump Donald Trump presidential campaign fixed Green Party Harman Center for the Arts Human Interest Inauguration of Donald Trump Joint Congressional Committee on Inaugural Ceremonies Mike Pence NAACP’s Youth and College Division Politics Politics of the United States Presidency of Donald Trump President Obama Presidential Inaugural Committee Protestant Episcopal Church Protests against Donald Trump Senate Smithsonian Trump Administration U.S. United States presidential inauguration United States presidential succession US Administration White House White House Fri, 20 Jan 2017 12:18:29 +0000 Tyler Durden 585949 at http://www.zerohedge.com S&P Futures, Dollar Rise As World Awaits Trump Inauguration Speech http://www.zerohedge.com/news/2017-01-20/sp-futures-dollar-rise-world-awaits-trump-inauguration-speech <p>Global shares were mixed, equity futures, the dollar and crude rose as investors focused their attention on today's inauguration of Donald Trump as U.S. president. While the early tone is well bid, some traders anticipate a volatile session, with speculation that a bout of "sell the inauguration" could cap the aging Trump rally, which started with his inauguration.</p> <p>Despite <a href="http://www.zerohedge.com/news/2017-01-19/janet-yellen-speaks-again-live-feed">last night's Yellen speech </a>which was more dovish than her remarks just 24 hours earlier, and which suggested that the US economy is "not overheating", the dollar managed to rebound from overnight losses and was trading 0.2% higher this morning. The early gains came after China reported its first economic expansion in 2 years (conveniently with president Xi in Davos) with GDP rising to 6.8% after quarters of decline. </p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/01/15/china%20GDP%20q4.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/01/15/china%20GDP%20q4_0.jpg" width="500" height="281" /></a></p> <p>However for the year, China's GDP growth declined to the <a href="http://www.zerohedge.com/news/2017-01-19/yuan-limps-lower-after-china-gdp-slight-upside-surprise-industrial-production-disapp">slowest pace in 26 years</a>, despite a record debt load and record weak Yuan.</p> <p><em><strong>&nbsp;</strong></em> </p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/01/17/20170119_china7.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/01/17/20170119_china7_0.jpg" width="501" height="262" /></a></p> <p>&nbsp;</p> <p>But it will be all about Trump today: tens of thousands of law enforcement officers and miles of barriers were in place in Washington D.C., as officials braced for hundreds of thousands of people planning to celebrate or protest the inauguration of Trump.&nbsp; The inauguration is “definitely a big moment for the markets,” said Neil Mellor, a London-based currency strategist at Bank of New York Mellon Corp. “We could get more clues about what Trump is planning today. <strong>If he ramps up the rhetoric the market will be concerned about building long dollar positions</strong>.”</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/01/15/trump%20rally%20chart.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/01/15/trump%20rally%20chart_0.jpg" width="500" height="281" /></a></p> <p>"All eyes will be on the content and style of Trump's inauguration speech," Morgan Stanley's Hans Redeker wrote in a note.&nbsp; "The more 'Presidential' this speech comes across, the better the outcome for markets."</p> <p>"[Trump is] likely to talk about job creation and unifying the U.S. and we may have to wait a bit longer for details on economic measures," said Natixis fixed income strategist Cyril Regnat.</p> <p>“It’s clear that investors have reached a level where they are prepared to wait and see what the Trump administration has to offer,” said Ric Spooner, chief market analyst at CMC Markets Asia Pacific Ltd. in Sydney.</p> <p>Trump’s inauguration ceremony “<strong>will be followed by a speech that will be carefully decoded by those looking for signs of things to come in the new U.S. administration, an exercise that amounts to political astrology in an era characterized by a shakeup of the old rules of the game</strong>,” Citigroup’s chief global political analyst Tina Fordham wrote in note.</p> <p>As <a href="https://www.bloomberg.com/news/articles/2017-01-19/stocks-in-asia-signal-caution-ahead-of-china-data-markets-wrap">Bloomberg notes</a>, rallies in the dollar and equities are easing this week before Trump is sworn in as the 45th American president, with investors growing anxious for indications the administration will follow through on pro-growth campaign promises. Billionaire investor George Soros said the euphoria among stock investors since Trump’s victory will end as uncertainty takes over. The Dow Jones Industrial Average has churned in its tightest range ever over the past month.</p> <p>European stocks opened weaker before recouping some losses to trade flat. Trading was choppy with mining shares, the biggest beneficiaries of the reflation rally spurred by Trump's election win, the biggest drag on the indexes. The Stoxx Europe 600 Index was poised for its worst week since early December while the pound slid after a report showed U.K. retail sales fell at the fastest pace in almost five years last month. Gold headed for a fourth weekly advance.</p> <p>Fund flows in the run-up to Friday's inauguration indicate investors moving into less risky assets and locking in some profits in banking stocks and high-yield debt. Precious metals funds saw their first inflows in 10 weeks, according to data from fund tracker EPFR and Bank of America-Merrill Lynch while money was pulled from funds focused on financials stocks and high-yield bonds.</p> <p>The Stoxx Europe 600 Index little changed as declines in miners offset gains in energy shares. Futures on the S&amp;P 500 Index rose 0.2%. The S&amp;P500 is heading for its biggest weekly drop of 2017. Contracts on the Dow Jones Industrial Average were little changed on Friday, and may be pressued by the disappointing earnings from both American Express and IBM.</p> <p>10Y yields were flat at 2.5%, erasing previous declines. Government bonds retreated across the European Union.</p> <p>* * *</p> <p><strong>Bulletin summary from RanSquawk</strong></p> <ul> <li>Somewhat of a quiet affair this morning with European bourses failing to find any firm direction</li> <li>USD saw softness during Asian hours amid dovish interpretations of Yellen's latest comments as well as ahead of Trump's inauguration</li> <li>As well as Presidential Elect Trump's Inauguration, today also see Canadian CPI and comments form Fed's Harker and Williams</li> </ul> <p><strong>Market Snapshot</strong></p> <ul> <li>S&amp;P 500 futures up 0.2% to 2267</li> <li>Stoxx 600 down 0.1% to 362</li> <li>FTSE 100 down less than 0.1% to 7205</li> <li>DAX down less than 0.1% to 11595</li> <li>German 10Yr yield up 2bps to 0.4%</li> <li>Italian 10Yr yield up 3bps to 2.02%</li> <li>Spanish 10Yr yield up 2bps to 1.5%</li> <li>S&amp;P GSCI Index up 0.5% to 396.9</li> <li>MSCI Asia Pacific down 0.1% to 140</li> <li>Nikkei 225 up 0.3% to 19138</li> <li>Hang Seng down 0.7% to 22886</li> <li>Shanghai Composite up 0.7% to 3123</li> <li>S&amp;P/ASX 200 down 0.7% to 5655</li> <li>US 10-yr yield up 3bps to 2.5%</li> <li>Dollar Index up 0.16% to 101.31</li> <li>WTI Crude futures up 1.2% to $51.98</li> <li>Brent Futures up 1.2% to $54.79</li> <li>Gold spot down 0.3% to $1,201</li> <li>Silver spot down 0.9% to $16.87</li> </ul> <p><strong>Top Global News</strong></p> <ul> <li>Trump Arrives for Inauguration With Promise to Unify the Nation: Addresses supporters on eve of swearing-in</li> <li>Yellen Says Fed Not Behind the Curve, Backs Gradual Rate Rises: Yellen sees risk in allowing the economy to run too hot</li> <li>Data showed U.K. retail sales fell at the fastest pace in almost five years in December</li> <li>China’s central bank said it provided a "temporary liquidity facility’’ to some major commercial banks for 28 days to help ease a cash crunch before the Lunar New Year holiday</li> <li>Soros Says Markets to Slump With Trump, EU Faces Disintegration: Says incoming U.S. president will fail</li> <li>JPMorgan Boosts CEO Dimon’s Annual Pay 3.7% to $28 Million: Bank awards $19 million compensation packages to four deputies</li> <li>IBM Margins Narrow While It Struggles to End Sales Slide: Revenue slips for 19th quarter, margins shrink for fifth</li> <li>American Express Profit Falls 8.2% as Expenses Top Estimates: Lender increases forecast for full-year earnings- per-share</li> <li>Deutsche Bank Burden in Mortgage Settlement Eased by Fine Print: German bank is the first to negotiate such a provision</li> <li>Heineken in Discussions With Kirin to Double Down in Brazil: Price would be less than a quarter of what it paid in 2011</li> <li>TPG’s Cushman &amp; Wakefield Said to Have Held Early IPO Talks: Company said to hold informal meetings on listing soon as 3Q</li> </ul> <p>* * * </p> <p><strong>Looking at regional markets, Asian stocks traded mixed </strong>following an uninspiring lead from Wall Street with participants cautious ahead of the US Presidential Inauguration and as the region digests Chinese GDP data. ASX 200 (-0.7%) lagged amid continued weakness in financials with mining names also pressured after iron ore prices fell over 1%. Conversely, Nikkei 225 (+0.3%) initially traded choppy alongside fluctuations in JPY, but was able to finish higher as JPY weakened slightly while Shanghai Comp (+0.7%) and Hang Seng (-0.6%) were mixed after a slew of tier-1 Chinese data including GDP in which the Y/Y figure beat expectations, although the pace of growth for 2016 was at its slowest in 26 years. Finally, 10yr JGBs traded higher amid a mostly cautious tone in the Asia-Pac region, while the BoJ were also in the market for a respectable JPY 1.12trl of JGBs ranging from 1yr-25yr-F maturities.</p> <p><em>Chinese data</em></p> <ul> <li><strong>Chinese GDP (Q4) Y/Y 6.8% vs. Exp. 6.7% (Prey. 6.7%)</strong></li> <li><strong>Chinese GDP YTD (Q4) Y/Y 6.7% vs. Exp. 6.7% (Prey. 6.7%): slowest yearly growth in 26 years. </strong></li> <li>Chinese Industrial Production (Dec) Y/Y 6.0% vs. Exp. 6.1% (Prey. 6.2%); YTD (Dec) Y/Y 6.0% vs. Exp. 6.0% (Prey. 6.0%)</li> <li>Chinese Retail Sales (Dec) Y/Y 10.9% vs. Exp. 10.7% (Prey. 10.8%); Sales YTD (Dec) Y/Y 10.4% vs. Exp. 10.4% (Prey. 10.4%)</li> </ul> <p><em>Top Asian News</em></p> <ul> <li>Mystery $9 Billion in Cash With Indians After Modi Shock Ban: Public withdrew more cash than currency in circulation: report</li> <li>Indonesia Tax Agency Demands Meeting With Top Google Executives: Google paid 5.2b rupiah in 2015 taxes: documents</li> <li>China Says It Offered Temporary Funding Support to Big Banks: ‘The central bank has a new liquidity tool,’ analyst says</li> <li>Mnuchin Says He’ll Tag China an FX-Manipulator If Warranted: Trump had backed away from pledge to add label immediately</li> </ul> <p><strong>In Europe, it has been a quiet morning </strong>with European bourses failing to find any firm direction, slight underperformance however has been observed in basis materials with Rio Tinto shares leading the FTSE 100 lower amid the declines in Iron prices.11 out of 19 Stoxx 600 sectors fall with basic resources, retail underperforming and oil &amp; gas, construction &amp; materials outperforming. 51% of Stoxx 600 members decline, 46% gain. While large UK supermarkets, Tesco's and Sainsbury's are soft today amid a negative note from Exane. Fixed income markets trade marginally in the red with Bunds lower by around 14 ticks, breaking below the 163.00 level, while slight outperformance in the curve has been notable in 5s and 10s.<strong><br /></strong></p> <p><em>Top European News</em></p> <ul> <li>U.K. Retail Sales Fall Most Since 2012 as Price Rises Bite: Sales drop 1.9% from November, decline 2% excluding auto fuel</li> <li>Lloyds Said to Shuffle Executives, Preparing for Strategy Review: CEO protege takes role examining group design, costs</li> <li>BofA, UBS Said to Lead Banks Sharing $427 Million UniCredit Fee: Fees represent about 3% of deal size vs 2% average</li> <li>Maersk IPO Plans Won’t Derail Bid for Dong’s $2.8 Billion Unit: Potential Dong bidders include DEA, PGNiG, BI analyst says</li> <li>Close Brothers Says Had Strong Performance at Start Fiscal Year: Confident of strong 1H result, good outcome for full 2017</li> <li>Tryg 4Q Net Misses Estimates; CEO Says 2017 on Track for Targets: Tryg 4Q profit after tax DKK560m vs est DKK664m</li> </ul> <p><strong>In currencies, </strong>the Bloomberg Dollar Spot Index was up 0.2 percent as of 10:38 a.m. in London after falling as much as 0.3 percent. The gauge is heading toward its first weekly advance since the period ending Dec. 23.&nbsp; The pound dropped 0.3 percent to $1.2301 and the euro retreated 0.3 percent to $1.0637. Nerves among USD longs were telling in late Asia and first thing in London were telling as the presidential inauguration ahead carries the ever-present risk of way lies ahead in terms of trade and currency policy in particular. This has since been reversed to some degree as UST yields push higher towards the highs seen at the very start of the year, but USD gains look a little more hesitant given events later in the day. USD/JPY is eyeing a return to the mid 115.00 highs seen yesterday, but notable was the EUFt/USD return to the upper 1.0600's again despite was an unchanged status quo at the ECB Thursday, with tapering considerations dismissed out of hand to see the accommodative stance maintained despite rising headline inflation. For GBP, <strong>a softer than expect retail sales read in the UK for Dec has put a modest dent in the Pound based on the EUR/GBP upturn, </strong>which as yet struggles for momentum above the .8650 mark. Cable has slipped below 1.2300, but partly due to the broader USD impact. 1.2250 support has yet to be tested.</p> <p><strong>In commodities, </strong>the Trump inauguration ahead is prompting much caution across all asset classes, but given the prospective impact on infra structure spending and trade policy which has ramifications for China in particular, base metals in particular have been trading flat to marginally lower over the last 24-36 hours or so. Gold was finding a modest bid as the USD retreated a little this morning, but with US Treasuries pulling back again, we have seen the yellow metal slip back below USD1200.00, although it is likely that general risk sentiment will provide some support given today's key events In Washington. Oil prices have stabilised after some notable losses in recent sessions, but the USD50.00 handle looks safe for now.</p> <p><strong>Looking at today’s calendar, </strong>there's nothing of note in the US this afternoon although we will hear from both the Fed’s Harker (2pm GMT) and Williams (6pm GMT). Of course the main event today will be Donald Trump’s inauguration as the 45th US President. The swearing-in ceremony is due at 2.30pm GMT. Before we wrap up, in addition to all things Trump related this weekend it’s also worth highlighting a couple of other potentially interesting events. French presidential candidate Marine Le Pen and Holland’s Freedom Party head Geert Wilders are amongst political leaders speaking at a rally of European nationalist parties in Germany tomorrow. Meanwhile on Sunday, France’s leftist parties are due to hold the first round of their primary. So worth keeping an eye on both those events.</p> <p><strong>US Event Calendar</strong></p> <ul> <li>9am: Fed’s Harker Speaks in New Jersey on Economic Outlook</li> <li>9:45am: Markit US Manufacturing PMI, Jan P, est. 54.3 (prior 54.3)</li> <li>10am: Existing Home Sales, Dec., est. 5.55m (prior 5.61m)</li> <li>10am: Richmond Fed Manufacturing Index, Jan. (prior 8)</li> <li>1pm: Baker Hughes rig count</li> <li>1pm: Fed’s Williams Speaks at Event at San Francisco Fed</li> </ul> <p><strong>Government:</strong></p> <ul> <li>12pm: President-Elect Donald Trump takes oath of office</li> <li>Senate to hold confirmation votes on some Cabinet nominees </li> <li>3pm: Congressional Hispanic Caucus holds news conference with House Democratic leaders on immigration policy</li> </ul> <p>* * * </p> <p><strong>DB's Jim Reid concludes the overnight wrap</strong></p> <p>In my 2017 outlook presentation in Paris I asked 4 questions where the audience were able to vote on the answer. The first was when will the next US recession occur? The audience voted 45% for 2019 and 45% for 2020 or beyond. The rest were 2017 and 2018. So they were pretty optimistic that the cycle will extend. When I asked this question to two big audiences on my travels last year around 70% answered 2017 or 2018 so expectations have seemingly changed. I also asked whether Italy will still be in the single currency in 5 years time. 91% said yes. Last year around 80% said yes in similar polls so again a more optimistic crowd. When asked whether the ECB will be fully out of QE by YE 2018 around 80% said no so it seems investors, although optimistic, still feel the ECB need to keep stimulus high over the next two years. Finally I asked what was the most likely event to occur out of the following four by the end of 2018? a) 10 year USTs above 5%, b) the S&amp;P 500 trading below 1500, c) England winning the football World&nbsp; Cup or d) France electing Le Pen. Interestingly answer a) won with nearly 50% and the biggest shock was that England winning the World Cup scored 40% on this measure with the other two making up the last 10%. So only a few French investors thought a Le Pen victory was more likely than 5% yields, the S&amp;P 500 below 1500 or England winning the World Cup.</p> <p>So overall an optimistic crowd contrasting with surveys I did last year at various conferences. So there's no doubt sentiment has changed in 2017 even if markets are in a bit of a lull. This should change soon one way or another as Donald Trump's inauguration today marks the start of what promises to be a fascinating ride with a wide range of outcomes. Trump is set to speak at 2.30pm GMT and all we know right now is that Trump was said to have prepared the speech himself, with some advice and counsel from advisers as well as from some historians specifically regarding the length of the speech. Trump was also said to have told reporters that the speech will aim to unite America but we know little more than that at this stage. So it remains to be seen just how market moving this will be.</p> <p>One topic which is certainly hogging the spotlight right now is the administration’s views on the US Dollar. Treasury secretary nominee Steven Mnuchin was the latest to address the currency debate yesterday and added to the confusion by saying that Trump’s observation on Monday that the Dollar is too strong was not meant as a “long-term comment”. Instead, Mnuchin said that “long-term strength over long periods of time is important” and that “I believe that’s a reflection of (the US having) the most attractive investment environment in the world”. Mnuchin also made comments about bank regulation, saying he supports the Volcker rule. On top of this he also said that he would look to raise the debt ceiling sooner rather than later, while also saying that he would label China a FX manipulator if warranted.</p> <p>Over in markets, Dollar strength was again a theme yesterday after the USD index closed up +0.22% although it did pare earlier gains of as much as +0.80%. The other theme yesterday was the second successive day of Treasury yields climbing higher. In fact 10y Treasury yields closed up 4.4bps higher yesterday at 2.475% - which is a YTD high - and have all of a sudden risen 17bps from the intraday lows on Tuesday. The data helped at the margin but it appeared to be Yellen’s speech the day before and then those comments from Mnuchin which helped drive yields higher. The Fed Chair spoke again this morning but it seems to largely be a repeat of what she said previously, with little new information to highlight. Meanwhile US equity markets never really got going yesterday with the S&amp;P 500 finishing -0.36% with rate sensitive sectors in particular underperforming.</p> <p>Before we go any further we’re straight to China now where the latest monthly data dump is in. It has revealed that China’s economy grew 6.8% yoy in Q4 last year which was slightly more than the 6.7% expected by the market. For full year 2016, China reported growth of 6.7% which, while being the slowest pace since 1990, did end up right in the middle of the government’s official target. Meanwhile other activity indicators were mixed. Retail sales rose +10.9% yoy in December (vs. +10.7% expected) which is a tenth higher than that in November, although industrial production did slip two-tenths to +6.0% yoy (vs. +6.1% expected). Finally fixed asset investment was reported as rising +8.1% yoy for the full year (vs. +8.3% expected).</p> <p>In terms of the market reaction Chinese equity markets are higher in response with the Shanghai Comp and CSI 300 +0.54% and +0.69% although a Bloomberg report suggesting that the China Financial Futures Exchange is to relax curbs on trading might also be helping the positive tone. Elsewhere it’s more mixed. The Nikkei is +0.14% although the Hang Seng (-0.58%), Kospi (-0.19%) and ASX (-0.58%) are down.</p> <p>Moving on. The other focus for markets yesterday was the ECB meeting outcome. As we’d expected, a patient message was preached. Our European economists noted that the Bank is looking through the rise in headline inflation as the ECB’s patience and willingness to wait to extract the underlying trend from inflation was emphasized. Draghi said the Council will “continue to look through” HICP inflation “if judged to be transient and to have no implications for medium-term price stability”. The ECB President also outlined a framework for judging the “sustained adjustment” of inflation. In the view of our colleagues, “looking through” inflation implies less risk of an early tightening move in March. June is still the earliest timing for a tapering decision.</p> <p>Away from that it was interesting to hear comments (Bloomberg) from hedge-fund manager George Soros yesterday in Davos. Speaking about Brexit he said that “it is unlikely that Prime Minister May is actually going to remain in power” and that Britons are in denial about what the economic impact of Brexit could be. When commenting about Europe Soros added that the laws that govern the EU are “not appropriate to the current circumstances” and that while he acknowledges it can still be saved, those making decisions in Brussels “know that Europe is not functioning”.</p> <p>Before we look at the day ahead, it was an overall decent day for economic data in the US yesterday. Housing starts were reported as rising a bumper +11.3% mom (vs. +9.0% expected) in December while the November data was also revised up. Building permits (-0.2% mom vs. +1.1% expected) did miss but again we saw upward revisions to prior months. Meanwhile initial jobless claims declined to 234k from 249k which is the lowest since November. Finally the Philly Fed manufacturing survey ticked up 3.9pts to 23.6 (vs. 15.3 expected). That’s actually the highest level since November 2014 and more importantly, the detail revealed broad-based improvement which is indicative of a decent improvement in business spending this year according to our US economists.</p> <p>Looking at today’s calendar, this morning in Europe the early data comes from Germany where the December PPI print will be released. Thereafter we’ll get retail sales numbers in the UK for the month of December which is expected to show a -0.4% mom decline excluding fuel. There’s nothing of note in the US this afternoon although we will hear from both the Fed’s Harker (2pm GMT) and Williams (6pm GMT). Of course the main event today will be Donald Trump’s inauguration as the 45th US President. The swearing-in ceremony is due at 2.30pm GMT. Before we wrap up, in addition to all things Trump related this weekend it’s also worth highlighting a couple of other potentially interesting events. French presidential candidate Marine Le Pen and Holland’s Freedom Party head Geert Wilders are amongst political leaders speaking at a rally of European nationalist parties in Germany tomorrow. Meanwhile on Sunday, France’s leftist parties are due to hold the first round of their primary. So worth keeping an eye on both those events.</p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="1200" height="675" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/trump%20rally%20chart.jpg?1484912913" /> </div> </div> </div> http://www.zerohedge.com/news/2017-01-20/sp-futures-dollar-rise-world-awaits-trump-inauguration-speech#comments American Express American people of German descent ASX 200 B+ Bank of Japan Bank of New York Bloomberg Dollar Spot Brazil Business Business China Climate change skepticism and denial CPI Crude Currency Davos Debt Ceiling Donald Trump Donald Trump Dow 30 Dow Jones Industrial Average Economy Equity Markets Euro European Central Bank European Union European Union fixed France Freedom party FTSE 100 Fund Flows George Soros Germany Google Hang Seng 40 Housing Starts Initial Jobless Claims Italy Jim Reid Markit Nikkei Nikkei 225 People's Bank of China Philly Fed Precious Metals Recession Richmond Fed S&P 500 S&P GSCI San Francisco Fed San Francisco Fed Senate Steven Mnuchin Stoxx 600 The Apprentice Trump Administration U.S. US Administration US Federal Reserve Washington D.C. WWE Hall of Fame Yuan Fri, 20 Jan 2017 11:53:12 +0000 Tyler Durden 585948 at http://www.zerohedge.com In "Strange Move", PBOC Cuts Reserve Ratio, Offers Temporary Funding Support For Largest Banks http://www.zerohedge.com/news/2017-01-20/strange-move-pboc-cuts-reserve-ratio-five-largest-banks-liquidity-shortage-soars <p>Overnight the PBOC injected another CNY95 billion into its banking system bringing the total weekly injection to a record CNY1.13 trillion.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/01/15/PBOC%20liquidity%20injection%202.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/01/15/PBOC%20liquidity%20injection%202_0.jpg" width="500" height="310" /></a></p> <p>However, it was not enough and overnight China allowed its five biggest banks to cut their reserve requirement ratio by 1% taking it down to 16% thus temporarily lowering the amount of money that they must hold as reserves to relieve pressure in its financial system as demand for cash surges ahead of the Lunar New Year holiday, <a href="http://www.reuters.com/article/us-china-economy-rrr-idUSKBN15412A">Reuters reported</a>. The banks affected by the move iclude ICBC, CCB, Bank of China, Bocom, and Agricultural Bank of China. The last time the central bank cut RRR was Feb. 29, 2016. The move is expected to release approximately 630 billion yuan in liquidity.</p> <p>The dramatic moves come in a bid to avert a cash crunch heading into the country's biggest holiday of the year.</p> <p>Earlier in the week short-term funding costs had spiked to their highest levels in nearly 10 years on fears that liquidity was sharply tightening, sparking a jump in the yuan currency. But China watchers polled by Reuters had not expected a cut in RRR until the third quarter of 2017, as such a move would put more pressure on the ailing yuan. Following the massive central bank liquidity injections, key funding and money market rates showed signs of easing on Friday but remained well above normal levels.</p> <p>But wait, that's not all, because also overnight, the PBOC said it provided a "<strong>temporary liquidity facility</strong>" to some major commercial banks for 28 days to help ease a cash crunch before the Lunar New Year holiday. <a href="https://www.bloomberg.com/news/articles/2017-01-20/pboc-says-it-offered-temporary-liquidity-support-to-some-banks">According to Bloomberg</a>, the operation provides more effective liquidity transmission before the week-long break, the People’s Bank of China said in a statement Friday. </p> <p>The PBOC said the new lending facility will have a funding cost for banks that’s around the same as open-market operations for a similar 28-day period, which is about 2.55 percent. That means the tool differs from cutting the ratio of deposits big banks must hold in reserve and suggests a fresh evolution of tools policy makers have been overhauling. </p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>Commercial banks had 11 trillion yuan ($1.6 trillion) of sovereign and financial bonds outstanding as of December, Ming said, and have pledged about 43 percent of those to access funding through central bank open market operations, limiting room for further such operations.</p> <p>&nbsp;</p> <p>The PBOC’s statement Friday didn’t say whether the temporary funding required collateral. Should none be required, that would be unusual because most such tools involve collateral. </p> <p>&nbsp;</p> <p>The PBOC has shifted toward selective tightening after a two-year easing cycle. President Xi Jinping and other policy makers decided at their annual economic conference last month China should plan prudent and neutral monetary policy this year to prevent financial risks. </p> <p>&nbsp;</p> <p>"It’s too premature to conclude that there’s a change in China’s monetary policy direction," Raymond Yeung, chief greater China economist at Australia &amp; New Zealand Banking Group Ltd. in Hong Kong, wrote in a note. "Liquidity management and leverage control seem to be more appropriate expressions to describe the policy direction of China’s central bank."</p> </blockquote> <p>"It’s likely the central bank will use temporary liquidity facility as a regular tool in the future to ease liquidity shortage before quarter-end or holidays," said Xia Le, chief economist at Banco Bilbao Vizcaya Argentaria SA in Hong Kong. The PBOC is using a new tool because older ones offer funds at a high cost and longer duration than needed, and it’s wasteful for banks that need money for five days to have to borrow for a full year, Xia said.</p> <p>While in the past the PBOC has engaged in similar moves ahead of the new year, the latest move suggested there were additional factors involved in draining liquidity: "<strong>Today's move seems to suggest that liquidity conditions are tighter than authorities' expectations, as capital outflows remain strong," </strong>said Zhou Hau, senior emerging markets economist at Commerzbank in Singapore.</p> <p>"But in the meantime, an outright easing will add pressure on the yuan exchange rate as well. <strong>That could be the reason behind today's strange move</strong>."</p> <p>The central bank will restore the RRR for the five banks to the normal level at an appropriate time after the holiday, according to Reuters' sources. "This is a temporary adjustment, and is mainly in response to the cash withdrawal, tax payment and reserve payment. (The RRR) will go back to the normal rate after the Lunar New Year holiday," one source said. </p> <p>The PBOC said later on Friday that it will provide temporary liquidity support for several major commercial banks for 28 days to ensure adequate liquidity ahead of the Lunar New Year, according to a notice posted on its official microblog.&nbsp; The funding cost for the liquidity support will be about the same as the open market operations rate over the same period, the PBOC said, without specifying any requirement for collateral.</p> <p>As noted previously, Chinese liquidity always tightens in China ahead of the Lunar New Year holiday, which this year starts on Jan. 27 and ends on Feb. 2, as households and companies usually withdraw huge amounts of cash from banks. The central bank typically responds by injecting ample funds into the market. </p> <p><strong>But some traders say its injections this year have barely been keeping up with heavier demand.</strong> This year, the holiday also extends over the month-end, when corporate cash demand increases and some tax payments are due, adding to the strain.</p> <p>Analysts estimate that every 50 basis point cut in RRR systemwide effectively injects an estimated $100 billion worth of long-term cash into the economy, which recorded its slowest growth in 26 years last year.</p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="872" height="540" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/PBOC%20liquidity%20injection%202.jpg?1484910648" /> </div> </div> </div> http://www.zerohedge.com/news/2017-01-20/strange-move-pboc-cuts-reserve-ratio-five-largest-banks-liquidity-shortage-soars#comments Australia Bank Banking Business Central bank China Chinese Banking Liquidity Crisis Economic policy Economy Financial economics Financial markets Hong Kong Market liquidity Monetary Policy Monetary policy Money New Zealand None Open market operation Open Market Operations People's Bank of China Renminbi Reserve requirement Reuters Systemic risk Yuan Fri, 20 Jan 2017 11:11:02 +0000 Tyler Durden 585947 at http://www.zerohedge.com "He Is Going To Fail": Georges Soros Slams "Would Be Dictator" Trump http://www.zerohedge.com/news/2017-01-19/trump-going-fail-soros-speaks-live-davos <p>Billionaire investor George Soros spoke to Bloomberg TV in Davos, and said the euphoria among stock investors since the victory of President-elect Donald Trump will end as uncertainty takes over.</p> <p>In an interview that may have been even gloomier than his last <a href="http://www.zerohedge.com/news/2016-01-21/soros-reveals-he-short-sp-500-warns-china-will-have-hard-landing-fed-hike-was-mistak">address to Davos in January 2016</a>, when he said he was short the market, predicted a Chinese hard landing, and said the Fed's hike was a mistake, on Thursday Soros unleashed the hate, saying America has elected a "would-be dictator" as president, the European Union is disintegrating, U.K. Prime Minister Theresa May won’t last long as her nation prepares to secede from the EU, and China is poised to become an even more repressive society. </p> <p>Talking his book, Soros said that 'Uncertainty is at a peak, and actually uncertainty is the enemy of long-term investment," said the chairman of Soros Fund Management. "I don’t think the markets are going to do very well. Right now they’re still celebrating. But when reality comes, it will prevail."</p> <p>As a reminder, the <a href="http://www.zerohedge.com/news/2017-01-12/soros-lost-1-billion-following-trump-election">WSJ reported last week </a>that Soros lost nearly $1 billion as a result of the stock-market rally spurred by Trump’s surprise win in November. Soros became more pessimistic immediately after Trump’s election. But stocks rallied on expectations that Trump’s policies will boost corporate earnings and the overall economy.</p> <p>The key highlight of the Soros interview, however, was his vicious slam of his nemesis, Donald Trump, saying <strong>"I have described him as an impostor and con man, and a would be dictator"</strong> and said that <strong>"I'm personally convinced he's going to fail" because the "the policies that guide him are inherently self-contradictory</strong>."</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/01/15/soros%20trump%20will%20fail.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/01/15/soros%20trump%20will%20fail_0.jpg" width="500" height="284" /></a></p> <p>He said that "<strong>Trump would be a dictator if he could get away with it</strong>" but believes that the Constitution of the United States is strong enough to prevent Trump from taking too much power.</p> <p>As a reminder, Soros was one of Hillary Clinton's biggest donors, and has spent millions to prevent Trump from entering the White House. </p> <p>He also said that it's impossible to predict exactly how Trump will act because he hasn't actively thought it through, he was surprised when he won. He added that he only started thinking seriously about what he would do after he was elected.</p> <p><iframe src="https://www.bloomberg.com/api/embed/iframe?id=7f11e634-2ece-43a2-b25e-aac9ba5cb3f2" width="500" height="281" frameborder="0"></iframe></p> <p>Some other notable quotes via <a href="http://news.forexlive.com/!/george-soros-20170119">Forexlive</a>: </p> <ul> <li>Trump stands for a government that's the opposite of an open society, something like a dictatorship or a mafia state</li> <li>Trump believes his ideas are the will of the people so anyone who is against him is against the people</li> <li>Markets will falter as uncertainty takes over</li> </ul> <p>Speaking about Europe and the UK, he said that Europe is in the process of disintegration. “If Europe breaks down, the consequences will be very dire,” the investor said. “But I do see a way it could be saved, and this is also recognized by many of the people in Brussels. They can’t say so publicly, but they know that Europe is not functioning.”</p> <p><iframe src="https://www.bloomberg.com/api/embed/iframe?id=b2650525-67af-4da0-b3f8-c967b94c119b" width="500" height="281" frameborder="0"></iframe></p> <p>He forecast that "if Europe breaks down, the consequences will be very dire, it's currently going on the wrong direction." </p> <p>He also took aim at the UK saying, “it is unlikely that Prime Minister May is actually going to remain in power,” adding she has a divided cabinet and base and Britons are in denial about the economic impact of Brexit. He predicted that inflation will be the force that will lead to declining living standards in the UK but said that it would take some time.&nbsp; </p> <p>Going back to China and Trump, Soros then said that Trump is definitely gearing up for a trade war with China which is irreconcilable with economic prosperity. He pointed out that, ironically, Trump would do more to make China an acceptable leader of the international community than Chinese could do by themselves.</p> <p>Soros continued to take a dim view of China's economy, saying the nation is at a decision point and must choose whether to become a more open or closed society as it transitions to a consumer-led economy. “China has not actually succeeded yet in changing its growth model and probably won’t do it in the next two years because Xi Jinping wants to maintain an unsustainable rate of growth,” he said. Jinping “is doing that by rekindling the furnaces and producing more goods that are already in supply.”</p> <p>He also predicted that if Trump names China a currency manipulator, they will retaliate. </p> <p>Finally, on the topic of China, <strong>he also warned that a trade war can easily spiral in a real military conflict. </strong></p> <p>To move forward, he called for cohesion among for unity and said that he hopes "the people who believe in an open society can get together."</p> <p>He concluded by expressing his frustration with the recent Hungarian crackdown on his various NGOs, reading from a pre-written statement and saying that the processes taking place in his native country impair human values and democracy. </p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="1139" height="648" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/soros%20trump%20will%20fail.jpg?1484858196" /> </div> </div> </div> http://www.zerohedge.com/news/2017-01-19/trump-going-fail-soros-speaks-live-davos#comments American people of German descent Bloomberg Business Central European University China Climate change skepticism and denial Congress Counterculture of the 1960s Davos Donald Trump Donald Trump European Union European Union Fail Finance George Soros George Soros International reactions to the United States presidential election Money Nationality Political positions of Donald Trump Reality The Apprentice Trade War US Federal Reserve White House White House WWE Hall of Fame Fri, 20 Jan 2017 10:28:14 +0000 Tyler Durden 585903 at http://www.zerohedge.com Can Saudi Arabia Survive With Oil Below $60? http://www.zerohedge.com/news/2017-01-19/can-saudi-arabia-survive-oil-below-60 <p><a href="http://oilprice.com/Energy/Energy-General/Can-Saudi-Arabia-Survive-With-Oil-Below-60.html"><em>Submitted by Gregory Brew via OilPrice.com,</em></a></p> <p><em><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/01/17/20170119_saudi1.jpg"><img height="246" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/01/17/20170119_saudi1_0.jpg" width="600" /></a></em></p> <p>With the OPEC production deal holding, at least for the moment, <strong><em>questions have now arisen over how prospects look for the cartel&rsquo;s biggest producer.</em></strong> It&rsquo;s been a strange few years for the Kingdom of Saudi Arabia, as its endured budget deficits for the first time in its modern history, stagnation in oil prices and rising competition from other OPEC members and the American shale boom. Recently, talk has centered on the Saudi monarchy&rsquo;s glimpse of the future: the Vision 2030 plan, whereby it hopes to diversify its economy and end its dependence on the mercurial oil and gas market. <strong>But can the world&rsquo;s biggest oil producer and OPEC&rsquo;s de facto leader pull it off?</strong></p> <p>In the short term,<strong> Riyadh will continue to feel the pain of lower-than-normal oil prices.</strong> The growth outlook for Saudi Arabia has been <a href="http://oilprice.com/Latest-Energy-News/World-News/IMF-Slashes-Saudi-Growth-Outlook-On-Oil-Output-Cuts.html">slashed</a>, as the International Monetary Fund (IMF) announced on January 16 that the world&rsquo;s largest oil producer would see its GDP grow by only 0.4 percent in 2017. The estimate comes on the basis of the continued low price of oil, but more importantly on the country&rsquo;s slashed oil production: as a result of the recent OPEC production deal, Saudi Arabia has agreed to keep its production level at or below 10 million bpd. <strong>This has resulted in a cut in its growth outlook, down from 2 percent in October, <a href="https://www.bloomberg.com/news/articles/2017-01-16/imf-slashes-saudi-arabia-growth-forecast-on-lower-oil-production">according</a> to Bloomberg.</strong></p> <p>This comes after anemic growth in 2016, where GDP expanded by only 1.4 percent. If oil prices stabilize, and the country&rsquo;s economic forecast improves, GDP will likely expand by 2.3 percent in 2018.</p> <p><strong>The official Saudi response <a href="https://www.bloomberg.com/news/articles/2017-01-17/saudi-arabia-expects-2017-growth-significantly-higher-than-imf">decried</a> the IMF&rsquo;s results as overly conservative.</strong> A government spokesman declared that Saudi growth would be &ldquo;north of 1 percent,&rdquo; citing the anticipated investment in <a href="http://oilprice.com/Energy/Energy-General/Saudi-Arabia-To-Spend-50-Billion-On-Massive-Solar-Push.html">renewable energy</a> and a stimulus packaged the Saudi government was planning for the private sector, according to Bloomberg. <span style="color: #800000;"><strong class="related">&nbsp;</strong></span></p> <p>The Saudi leadership had been pivotal in the campaign to bring about an OPEC cut, after resisting production deals for years. <strong>The stakes were raised this year, as draining cash reserves and a resistant American energy sector convinced Riyadh that cuts were needed to boost prices.</strong> The cuts have come, surprising many analysts, and the OPEC deal looks set to hold at least for the time being.</p> <p><strong>Along with the cuts to production, the Saudi government looks to cut spending.</strong> The <a href="https://www.mof.gov.sa/en/budget2017/Documents/The_National_Budget.pdf">2017 budget</a>, the most detailed in the country&rsquo;s history, lays out a series of measures for stabilizing state finances, which plunged into deficit in 2016 as a result of the crash in prices. The state is the largest employer and spender in the Saudi economy, which is largely built on the oil and gas industry. Cuts to construction projects and social programs, estimated at around $20 billion, will help to balance the budget. The deficit in 2016 was around 12.6 percent, down from 2015&rsquo;s budget deficit of 15 percent, and if prices stay where the Saudis expect them to, between $50 and $43 per barrel, the budget gap in 2017 will be smaller still. The official Saudi estimate has the deficit amounting to 7.7 percent of GDP in 2017.</p> <p>The current fiscal forecast is based on the National Transformation program (NTP) which aims at a balanced budget by 2020. <strong>The plan, also known as <a href="http://vision2030.gov.sa/en/ntp">Vision 2030</a>, was announced in 2016 and is intended to diversify the Saudi economy away from petroleum.</strong> The largest single component in the Saudi economic sector, the massive state energy company Saudi Aramco, is to be privatized, and its assets used to develop the country&rsquo;s manufacturing, tourism and other sectors.</p> <p>Gestures towards building investors&rsquo; confidence in the Saudi economy have included last year&rsquo;s $17.5 billion <a href="http://www.reuters.com/article/us-saudi-bonds-idUSKCN12J1E7">sovereign bond sale,</a> the largest such issue in history and a move which attracted bids totaling $67 billion, according to Bloomberg. Looking ahead, the Saudi government is expected to raise another $15 billion on international markets this year, boosting debt levels as high as 30 percent of total GDP by 2020. It is hoped that by then the budget will be back in surplus, likely spurred on by further sales of Saudi Aramco.</p> <p><strong><em>Investors are spurred on by the attractive Saudi rial-dollar rate, the continued strength of Saudi oil production (which has shown no signs of slowing down), and the clear interest within the current Saudi government in serious financial and economic reforms. This should make it easy for the Saudi state to raise all the funds its needs on international markets.<span style="color: #800000;"><strong class="related">&nbsp;</strong></span></em></strong></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/01/17/20170119_saudi2.jpg"><strong><em><span style="color: #800000;"><strong class="related"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/01/17/20170119_saudi2_0.jpg" style="width: 600px; height: 314px;" /></strong></span></em></strong></a></p> <p><u><strong>But that&rsquo;s in the short term. </strong></u>Borrowing can only cover budget deficits for so long, and growth in the non-oil economy will have to be kick-started if the Saudi vision can be realized. The problem is that Saudi non-oil prospects aren&rsquo;t great, with the non-oil economy on the edge of recession pending the release of some Q316 data. Government borrowing an increase in contracts in 2017 should boost non-oil growth from 0.2 percent to 0.8 percent, hopefully reaching 1.9 percent in 2018, <a href="http://www.cpifinancial.net/news/category/economics/post/39015/macroeconomic-outlook-saudi-arabia-economic-activity-slows-as-fiscal-consolidation-proceeds-apace">according</a> to CPI Financial.</p> <p>Public debt will grow from 1.6 percent in 2014 to 23 percent in 2018. This is still a historically low rate for a country the size of Saudi Arabia, but<strong> the growth in debt could have investors alarmed and scare markets away from accepting more and more Saudi debt, </strong>which looks likely to fund continued growth past 2017.</p> <p>So, while the Saudi forecasts are upbeat, and Saudi rhetoric around oil prices <a href="http://oilprice.com/Energy/Energy-General/Saudi-Minister-Talks-Up-Oil-Prices.html">remains buoyant</a> and hopeful, <strong>storm clouds are hovering on the horizon for the oil kingdom</strong>. Should the Vision 2030 plan succeed, and the country pivots away from oil and gas, fostering non-oil growth and a balanced budget in the next five-to-ten years, it will have justified Saudi enthusiasm. <strong>But oil remains the most important component in the Saudi economic picture, and the assertions of the 2017 budget and future forecasts are based on the assumption that oil prices will climb back up to $60 by 2018.</strong> Should that increase fail to occur, and the Saudi treasury continue to sell off more bonds and accumulate more debt, things in Riyadh could get more unstable.</p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="667" height="273" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170119_saudi1.jpg?1484845447" /> </div> </div> </div> http://www.zerohedge.com/news/2017-01-19/can-saudi-arabia-survive-oil-below-60#comments Asia Bond Budget Deficit Business CPI Economic history of Saudi Arabia Economy Economy of Saudi Arabia Economy of the Arab League Fail International Monetary Fund International Monetary Fund OPEC OPEC Organization of Petroleum-Exporting Countries Petroleum industry Petroleum politics Politics Price of oil Recession Saudi Arabia Saudi Arabia Saudi Aramco Saudi government Saudi Vision Fri, 20 Jan 2017 10:00:00 +0000 Tyler Durden 585910 at http://www.zerohedge.com California Governor Jerry Brown Admits To $1.5 Billion "Math Error" In State Budget http://www.zerohedge.com/news/2017-01-19/california-governor-jerry-brown-admits-15-billion-math-error-state-budget <p>Budgeting can be difficult, particularly for expansive state budgets that require a ton of inputs to support 1,000s of line items each of which can result in massive variances depending on the development of various economic indicators like interest rates, commodity prices, etc. throughout the year.</p> <p>That said, while forecasting variances are inevitable, we, as taxpayers, generally rely on our expensive budget office employees to at least present annual budgets that reflect sound mathematics and accounting principles.&nbsp; Unfortunately, that seems to be too much to ask of the <strong>math-challenged administration of California Governor Jerry Brown which decided to double count certain cost savings and simply "forgot" to incorporate other expenses</strong> altogether.&nbsp; Per the <a href="http://www.latimes.com/politics/essential/la-pol-ca-essential-politics-updates-in-sacramento-s-first-hearing-on-state-1484693129-htmlstory.html">LA Times</a>:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>Budget staffers said there were, in fact, two mistakes:<br /> </p><p style="padding-left: 30px;">&nbsp;</p> <p style="padding-left: 30px;">-&nbsp; A <strong>double counting of state savings from a program that coordinates health, behavioral and long-term care services with local government</strong>. That error understated expenses by $913 million.</p> <p style="padding-left: 30px;">&nbsp;</p> <p style="padding-left: 30px;">-&nbsp; <strong>A forgotten state government cost from two counties — San Mateo and Orange</strong> — enrolling in the coordinated program, which meant missed expenses of $573 million.</p> </blockquote> <p><img src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/01/19/2017.01.19%20-%20Jerry%20Brown_0.JPG" alt="Jerr Brown" width="600" height="437" /></p> <p>&nbsp;</p> <p>Embarrassingly, when asked about the "mistakes" that resulted in a $1.6 billion budget deficit, the Chief Deputy Director of Brown's Department of Finance could offer no other explanation than that the <strong>"math was wrong" </strong>while another spokesman admitted, <strong>“There’s no other way to describe this other than a straight up error in accounting, which we deeply regret."</strong></p> <p>Meanwhile, adding insult to injury, Brown's administration allegedly discovered their "accounting errors" several months ago but didn't disclose them to State Senators until last week.&nbsp; Per <a href="http://www.mercurynews.com/2017/01/18/1-8-billion-error-adds-to-california-deficit-projection/">Mercury News</a>:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>The administration discovered accounting mistakes last fall, but it did not notify lawmakers until the administration included adjustments to make up for the errors in Brown’s budget proposal last week.</p> <p>&nbsp;</p> <p>The Department of Finance said it <strong>did not account for $487 million in rebates from drugmakers that the state must pay the federal government </strong>to reimburse Washington for its share of Medi-Cal drug costs.</p> <p>&nbsp;</p> <p>The state also miscalculated costs for the Coordinated Care Initiative, an experimental program in seven counties to improve care for a group of high-needs patients eligible for both Medi-Cal and Medicare, the federally funded health plan for seniors and people with disabilities.</p> <p>&nbsp;</p> <p><strong>Officials double-counted some of the expected savings, leading to a budget hole of $913 million, and undercounted the costs in San Mateo and Orange counties by $573 million.</strong></p> <p>&nbsp;</p> <p>In his spending plan, Brown proposed eliminating the Coordinated Care Initiative because he said the program was not cost effective, angering counties that said the change would shift $550 million in costs to them.</p> </blockquote> <p>Of course, the blatant attempt to cover up their "math error" rather than quickly admit the mistake last fall, led California State Senator John Moorlach to ask the obvious question of what other errors may be buried in the expansive budget, saying <strong>“It makes you wonder what else is not right. … When something like this happens, the trust factor gets eroded, and you lose confidence in what’s being provided to you."</strong>&nbsp; But, no matter the size of the various other "math errors" that come to light, we're quite certain that California's liberal legislators in Sacramento stand ready, willing and able to implement whatever tax hikes may be necessary to address such issues.</p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="930" height="678" alt="" src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017.01.19%20-%20Jerry%20Brown.JPG?1484844200" /> </div> </div> </div> http://www.zerohedge.com/news/2017-01-19/california-governor-jerry-brown-admits-15-billion-math-error-state-budget#comments Brown's administration Budget Budget Deficit Department of Finance ETC Federal assistance in the United States federal government Government Healthcare reform in the United States Medi-Cal Medicare Medicare Medicare Politics Presidency of Lyndon B. Johnson Social Issues United States Fri, 20 Jan 2017 09:20:00 +0000 Tyler Durden 585886 at http://www.zerohedge.com Are NATO Members Paying Their Fair Share? (Spoiler Alert: No!) http://www.zerohedge.com/news/2017-01-19/are-nato-members-paying-their-fair-share-spoiler-alert-no <p>Donald Trump is right to say America’s NATO allies aren’t paying their fair share. <a href="https://www.bloomberg.com/news/articles/2017-01-18/by-ripping-nato-trump-makes-europe-nervous-and-arms-trade-happy">As Bloomberg notes</a>, <strong>the alliance expects its members to spend 2% of GDP on defense; but it’s no secret that most of them don’t...</strong></p> <p><strong><br /></strong></p> <p><strong><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/01/17/20170119_nato.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/01/17/20170119_nato_0.jpg" width="600" height="424" /></a></strong></p> <p>&nbsp;</p> <p>Having reaffirmed his skepticism about the North Atlantic Treaty Organization, and his readiness to make deals with Russia, in European media interviews published last weekend, President Trump leaves European leaders wondering whether they can still rely on the American security umbrella.</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><strong><em>“Let’s not fool ourselves,” German Chancellor Angela Merkel said last week. “There is no infinite guarantee.”</em></strong></p> </blockquote> <p><strong>So, in what looks like another <span style="text-decoration: underline;">Trump victory,</span> Merkel’s Germany, and many other European nations, are boosting military budgets.</strong></p> <p>To be sure, even in Europe’s “new strategic reality” in which NATO guarantees are no longer unconditional, <strong>some defense budgets will likely fall short,</strong> said Jan Techau, head of the Richard C. Holbrooke Forum at the American Academy in Berlin. <em><strong>“The Europeans will have to do something,” he said. “But I have my doubts that we’ll get across-the-board 2 percent spending.”</strong></em></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="1191" height="842" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170119_nato.jpg?1484885752" /> </div> </div> </div> http://www.zerohedge.com/news/2017-01-19/are-nato-members-paying-their-fair-share-spoiler-alert-no#comments Alt-right American Academy in Berlin Angela Merkel Climate change skepticism and denial Conservatism in the United States Donald Trump Donald Trump Germany International relations Military NATO North Atlantic Treaty Organization Politics Politics Richard Holbrooke The Apprentice WWE Hall of Fame Fri, 20 Jan 2017 09:15:00 +0000 Tyler Durden 585944 at http://www.zerohedge.com “Deploraball” Protests Turn Bloody As Trump Supporter Assaulted With Flagpole http://www.zerohedge.com/news/2017-01-20/%E2%80%9Cdeploraball%E2%80%9D-protests-turn-bloody-trump-supporter-assaulted-flagpole <p><img src="https://ibankcoin.com/zeropointnow/files/2017/01/C2mYtb5W8AACEs-.png" alt="C2mYtb5W8AACEs-" width="562" height="250" style="margin-right: auto; margin-left: auto; display: block;" class="aligncenter wp-image-5309 " /></p> <p>&nbsp;</p> <p><img src="https://ibankcoin.com/zeropointnow/files/2017/01/hit-300x284.png" alt="hit" width="250" height="237" style="float: right;" class="alignright wp-image-5301 size-medium" />Reports have been rolling in all evening&nbsp;of vicious mobs of&nbsp;violent protesters around Washington DC&nbsp;attacking Donald Trump supporters&nbsp;in town for the inauguration, including people on their way to and from&nbsp;tonight's pre-Inauguration&nbsp;"Deploraball" celebration, held at the National Press Club building.&nbsp;Over 1000 guests were invited to the event organized by Mike @Cernovich and the&nbsp;pro-Trump&nbsp;MAGA3X organization.</p> <p>&nbsp;</p> <p>As Fox&nbsp;News&nbsp;<a href="http://www.foxnews.com/politics/2017/01/20/deploraball-guests-met-by-protesters-in-chaotic-scene.html" target="_blank"><span style="text-decoration: underline;"><span style="color: #0066cc;">reports</span></span></a>:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <table style="width: 465px; height: 1px;" border="0"> <tbody> <tr> <td>Some of the hundreds of protesters sprayed Mace, while others were peaceful as law enforcement officers lined the streets to monitor the chaotic scene. At least one passer-by reported bottles were being thrown as he showed off a gash in his head.</td> </tr> </tbody> </table> </blockquote> <p>One of the victims was&nbsp;21 year old Trump supporter and <a href="https://www.youtube.com/c/JamesAllsup95" target="_blank"><span style="text-decoration: underline;"><span style="color: #0066cc;">Youtube Journalist</span></span></a> James Allsup of Seattle,&nbsp;who was harassed and then punched on&nbsp;camera by members of&nbsp;the "Antifa"&nbsp;protest organization featured in the recent Project Veritas <a href="http://projectveritas.com/2017/01/16/part-i-hidden-camera-investigation-uncovers-groups-plotting-violence-at-trump-inauguration/" target="_blank"><span style="text-decoration: underline;"><span style="color: #0066cc;">undercover sting</span></span></a>.</p> <p>After the cameras were off, Allsup was hit on the back of the head with a flagpole requiring a trip to the ER for some staples.</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <table style="width: 493px; height: 66px;" border="0"> <tbody> <tr> <td>“I was wearing my ‘Make America Great Again’ hat, and a white male came up behind me and swung at me with a flagpole – I kind of blacked out for a minute,” Allsup told Foxnews.com. “Before I knew it my head was gushing blood—there’s blood on my Trump hat.”</td> </tr> </tbody> </table> </blockquote> <p><span style="color: #ff6600;"><strong>Here is footage of the first encounter in which Allsup is punched:</strong></span></p> <div class="wpview-wrap"> <div class="wpview-body"> <div class="wpview-content wpview-type-embedURL"><iframe src="https://www.youtube.com/embed/uI9M_EmzBuc?feature=oembed" width="618" height="348" frameborder="0"></iframe></div> </div> <p class="wpview-selection-after">&nbsp;</p> <p class="wpview-selection-after"><strong><span style="color: #ff6600;">Followed by Allsup's account over Twitter of what took place:</span></strong></p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">So here's the story of what happened tonight at <a href="https://twitter.com/hashtag/Deploraball?src=hash" target="_blank">#Deploraball</a> (posting from hospital bed) 1/?</p> <p>— James Allsup (@realJamesAllsup) <a href="https://twitter.com/realJamesAllsup/status/822287641861300225" target="_blank">January 20, 2017</a></p> </blockquote> <p><script src="//platform.twitter.com/widgets.js"></script></p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">Me and some guys went to get drinks and check out the anti Trump protests outside <a href="https://twitter.com/hashtag/Deploraball?src=hash" target="_blank">#Deploraball</a></p> <p>— James Allsup (@realJamesAllsup) <a href="https://twitter.com/realJamesAllsup/status/822287907167895554" target="_blank">January 20, 2017</a></p> </blockquote> <p><script src="//platform.twitter.com/widgets.js"></script></p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">I was talking to some leftist on camera about <a href="https://twitter.com/bakedalaska" target="_blank">@bakedalaska</a> when some Antifa kid started pushing on me from behind. 3/?</p> <p>— James Allsup (@realJamesAllsup) <a href="https://twitter.com/realJamesAllsup/status/822288104186904577" target="_blank">January 20, 2017</a></p> </blockquote> <p><script src="//platform.twitter.com/widgets.js"></script></p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">I turned around and told him to knock it off. He didn't. I turned again and said "I'm don't follow the NAP" or something dumb like that 4/?</p> <p>— James Allsup (@realJamesAllsup) <a href="https://twitter.com/realJamesAllsup/status/822288415471398912" target="_blank">January 20, 2017</a></p> </blockquote> <p><script src="//platform.twitter.com/widgets.js"></script></p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">Turned around. Suddenly my hat is snatched. I jump back to grab and next thing I know, coward in mask punches me in the face. 5/?</p> <p>— James Allsup (@realJamesAllsup) <a href="https://twitter.com/realJamesAllsup/status/822288634690863104" target="_blank">January 20, 2017</a></p> </blockquote> <p><script src="//platform.twitter.com/widgets.js"></script></p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">Situation gets out of hand. Someone recovers hat and hands to me. The guy also punched am undercover cop- he gets arrested, going 2 jail 6/?</p> <p>— James Allsup (@realJamesAllsup) <a href="https://twitter.com/realJamesAllsup/status/822288825636495360" target="_blank">January 20, 2017</a></p> </blockquote> <p><script src="//platform.twitter.com/widgets.js"></script></p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">I go give info &amp; statement. Guy is booked on 2nd degree assault against me. Likely going to jail. I leave and meet back w/ friends 7/?</p> <p>— James Allsup (@realJamesAllsup) <a href="https://twitter.com/realJamesAllsup/status/822289064359579648" target="_blank">January 20, 2017</a></p> </blockquote> <p><script src="//platform.twitter.com/widgets.js"></script></p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">We're standing outside Shelly's and some guy runs out of crowd. Bleeding. Trump supporter, hit 20+ times 8/?</p> <p>— James Allsup (@realJamesAllsup) <a href="https://twitter.com/realJamesAllsup/status/822289201391603712" target="_blank">January 20, 2017</a></p> </blockquote> <p><script src="//platform.twitter.com/widgets.js"></script></p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">I (and Vermin Supreme, who was right there) help guy get to safety in Shelly's. His friend comes, I leave 9/?</p> <p>— James Allsup (@realJamesAllsup) <a href="https://twitter.com/realJamesAllsup/status/822289449581182976" target="_blank">January 20, 2017</a></p> </blockquote> <p><script src="//platform.twitter.com/widgets.js"></script></p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">We all decide to put cameras away and walk through protest to leave. One of my guys must have said something to set off protesters. 10/?</p> <p>— James Allsup (@realJamesAllsup) <a href="https://twitter.com/realJamesAllsup/status/822289666980347904" target="_blank">January 20, 2017</a></p> </blockquote> <p><script src="//platform.twitter.com/widgets.js"></script></p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">I hear "die Nazi" being yelled. Crowd begins chasing us. I know this is not good. 11/?</p> <p>— James Allsup (@realJamesAllsup) <a href="https://twitter.com/realJamesAllsup/status/822289739797630981" target="_blank">January 20, 2017</a></p> </blockquote> <p><script src="//platform.twitter.com/widgets.js"></script></p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">Next thing I know ears are ringing. I turn and see white male, approx 5ft11,with flagpole in hand. I knew. 12/?</p> <p>— James Allsup (@realJamesAllsup) <a href="https://twitter.com/realJamesAllsup/status/822289943942807552" target="_blank">January 20, 2017</a></p> </blockquote> <p><script src="//platform.twitter.com/widgets.js"></script></p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">I pull MAGA cap off, run hand through hair. Hand is full of blood. Now I know it's serious. 13/?</p> <p>— James Allsup (@realJamesAllsup) <a href="https://twitter.com/realJamesAllsup/status/822290736355962881" target="_blank">January 20, 2017</a></p> </blockquote> <p><script src="//platform.twitter.com/widgets.js"></script></p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">Bit of a blackout here. Don't exactly remember what happened. Cops pulled me and Nico out. Bring us through building. 14/?</p> <p>— James Allsup (@realJamesAllsup) <a href="https://twitter.com/realJamesAllsup/status/822290744039919617" target="_blank">January 20, 2017</a></p> </blockquote> <p><script src="//platform.twitter.com/widgets.js"></script></p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">About to get head stapled. Thanks all for good wishes.</p> <p>— James Allsup (@realJamesAllsup) <a href="https://twitter.com/realJamesAllsup/status/822308427825192960" target="_blank">January 20, 2017</a></p> </blockquote> <p><script src="//platform.twitter.com/widgets.js"></script></p> <p>And to prove it wasn't staged, here’s the ER report:</p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">For those claiming attack was fake, false flag etc; here are the hospital reports from GWU <a href="https://t.co/NMFWY77WDf" target="_blank">pic.twitter.com/NMFWY77WDf</a></p> <p>— James Allsup (@realJamesAllsup) <a href="https://twitter.com/realJamesAllsup/status/822345751879622656" target="_blank">January 20, 2017</a></p> </blockquote> <p><script src="//platform.twitter.com/widgets.js"></script></p> <p>It's easy to be tough guys when you're hiding behind balaclavas and greatly outnumber two Trump supporters. It might not go so well next time depending on who these amateur anarchists fuck with next...&nbsp;</p> <p><img src="https://ibankcoin.com/zeropointnow/files/2017/01/notontheinternet.png" width="498" height="492" style="display: block; margin-left: auto; margin-right: auto;" /></p> <p style="text-align: center;"><em style="box-sizing: border-box; font-variant-numeric: inherit; font-stretch: inherit; font-size: 13px; line-height: inherit; font-family: lucida_granderegular, Verdana, sans-serif; text-align: center;"><span style="box-sizing: border-box; font-style: inherit; font-variant: inherit; font-weight: inherit; font-stretch: inherit; font-size: 13.008px; line-height: inherit; font-family: inherit;"><span style="box-sizing: border-box; font-style: inherit; font-variant: inherit; font-weight: inherit; font-stretch: inherit; font-size: 13px; line-height: inherit;">Content originally generated at <a href="https://ibankcoin.com/" target="_blank">iBankCoin.com</a>&nbsp;<span style="box-sizing: border-box; font-style: inherit; font-variant: inherit; font-weight: inherit; font-stretch: inherit; font-size: inherit; line-height: inherit; font-family: inherit; color: #ff6600;"><strong style="box-sizing: border-box; font-style: inherit; font-variant: inherit; font-stretch: inherit; font-size: inherit; line-height: inherit; font-family: inherit;">*</strong></span>&nbsp;Follow on Twitter @<a href="https://twitter.com/ZeroPointNow" target="_blank">ZeroPointNow</a></span></span></em></p> </div> http://www.zerohedge.com/news/2017-01-20/%E2%80%9Cdeploraball%E2%80%9D-protests-turn-bloody-trump-supporter-assaulted-flagpole#comments American people of German descent Business Cernovich and the pro-Trump MAGA3X Climate change skepticism and denial Donald Trump Donald Trump Donald Trump presidential campaign ETC Fox News National Press Club Politics of the United States The Apprentice Twitter Twitter United States WWE Hall of Fame Fri, 20 Jan 2017 08:51:05 +0000 ZeroPointNow 585946 at http://www.zerohedge.com 5 Territorial Disputes To Watch For In 2017 http://www.zerohedge.com/news/2017-01-19/5-territorial-disputes-watch-2017 <p><a href="http://globalriskinsights.com/2017/01/5-territorial-disputes-watch-2017/"><em>Submitted by Barton Edgerton viaGlobalRiskInsights.com,</em></a></p> <p><strong><em>For several places around the world, 2017 could be a watershed year, as various territorial disputes threaten to boil over amidst a climate of global uncertainty.</em></strong></p> <p>Much like fights over territory itself, the concept of territory has disputed roots. It is not uncommon to associate &lsquo;territory&rsquo; with &lsquo;terra&rsquo; as in terra firma (or <em>terroir</em> to wine connoisseurs). However, some scholars suggests an alternative root &ndash; &lsquo;terror&rsquo;. Here, territory belongs to those who are able to instill fear such that those living within its boundaries are obliged to respect the laws and norms of their respective rulers. This is the very core of the Hobbesian concept of sovereignty and gets to the heart of territorial disputes. At the moment, fear may be the more useful concept when evaluating contested territories &ndash; fear present in governments, policy makers, and businesses.</p> <p>More acutely, potentially significant shifts in policy from the incoming Trump administration have created significant ambiguity in the role the United States may play in these disputes. Other challenges have also served to fan the flames in several specific hot spots. Any such shift, from recent elections or other sources, will likely have follow-on effects as states, NGOs, and other actors alter their own positions in response. Below are five territorial disputes that may be exacerbated over the next year.</p> <h4><span style="text-decoration: underline;"><strong>South China Sea </strong></span></h4> <p>China <a href="http://globalriskinsights.com/2016/07/south-china-sea-ruling-view-southeast-asia/">claims</a> large portions of the South China Sea. To bolster its position, the Chinese government has built artificial islands to turn a dispute about the ocean into one about land. This was investigated by an international tribunal in the Hague during the summer of 2016. Since then, Washington has taken a relatively cautious approach. However, during a Senate hearing on January 12th, US Secretary of State nominee Rex Tillerson, made it clear that he believes the <a href="http://globalriskinsights.com/2016/02/beijing-retains-south-china-sea-as-core-interest/">Chinese stance</a> to be unacceptable. &ldquo;You&rsquo;re going to have to send China a clear signal that, first, the island-building stops, and second, your access to those islands is also not going to be allowed,&rdquo; he told senators.</p> <p><a href="http://i1.wp.com/globalriskinsights.com/wp-content/uploads/2017/01/67616829_south_china-sea_1_464.gif"><img alt="_67616829_south_china-sea_1_464" class="aligncenter wp-image-24632" height="406" src="http://i1.wp.com/globalriskinsights.com/wp-content/uploads/2017/01/67616829_south_china-sea_1_464.gif?resize=500%2C406" style="opacity: 1;" width="500" /></a></p> <p>Although the official Chinese response was to downplay the significance of this statement, its state run media interpreted Tillerson&rsquo;s comments more aggressively. An estimated $5 trillion in trade travels through the South China Sea, meaning even a slight disruption can have profound effects on economies and investors across the globe.</p> <h4><span style="text-decoration: underline;"><strong>Israel and Palestine</strong></span></h4> <p>The United States has long maintained that it acts as an honest broker in the Israeli &ndash; Palestinian conflict. While this was view has not always been shared by all parties, US policy has remained predictable and stable for nearly 30 years. The incoming Trump administration appears to be signaling a clear and vocal shift.</p> <p>Since the early 1990&rsquo;s, the US has generally viewed <a href="http://globalriskinsights.com/2016/03/militant-violence-negatively-impacts-business-in-the-west-bank-israel-unaffected/">Israeli</a> settlements as a barrier to furthering the peace process. Furthermore, US policy on retaining its embassy in Tel Aviv, rather than Jerusalem is nearly as old as Israel itself. This may change abruptly with the appointment of David Friedman as US ambassador to Israel. In the past he appears to have diverged from US policy on both issues. It is unclear if this signals a shift in actual policy or if there is simply a stronger voice in the incoming administration to do so. Either way, it is likely to increase uncertainty for Israeli and Palestinian governments, NGOs, and investors approaching key questions in their respective portfolios.</p> <h4><span style="text-decoration: underline;"><strong>Crimea</strong></span></h4> <p>Since Russia&rsquo;s <a href="http://globalriskinsights.com/2014/05/crimea-annexation-comes-with-host-of-problems-for-russia/">2014 intervention</a> in Ukraine, global reaction has been near universal condemnation: the EU, US, and others began sanctions soon thereafter. These may have contributed to both the decline in the value of the ruble and Russia&rsquo;s poor financial performance over the last two years.</p> <p>On January 15th, 2017 Donald Trump signaled a willingness to lift sanctions in exchange for a nuclear arms deal between the US and Russia. In recent years Russia has been among the three largest oil producing nations. However, sanctions have made it difficult for Moscow to benefit from oil exports; lifting <a href="http://globalriskinsights.com/2015/09/sanctions-encourage-money-laundering-in-crimea/">sanctions</a> would likely reverse this. Perhaps more importantly is the exchange of sanctions for a nuclear arms deal, which would further entrench Russia&rsquo;s territorial claims in Crimea.</p> <h4><strong><span style="text-decoration: underline;">The Arctic seafloor</span></strong></h4> <p>In August 2007, a Russian submarine descended nearly four kilometers (2.5 miles) under the Arctic to plant a flag on the seafloor. As many investors are no doubt aware, the claim is not only a way to gain access to the potentially vast natural resources under the ocean; rather it also has the potential to determine control of shipping lanes as <a href="http://globalriskinsights.com/2015/09/canada-and-russias-arctic-path-to-reconciliation/">Arctic</a> ice melts.</p> <p>Since 2015 Russia has attempted to legitimize this claim through UN recognition. However, it was not until August of 2016 that the UN Commission on the Limits of the Continental Shelf began its evaluation. It is important to note that US, Canada, Norway, and Denmark have also made claims in the region.</p> <p><a href="http://i1.wp.com/globalriskinsights.com/wp-content/uploads/2017/01/20141220_IRM937.png"><img alt="20141220_IRM937" class="aligncenter wp-image-24633" height="339" src="http://i1.wp.com/globalriskinsights.com/wp-content/uploads/2017/01/20141220_IRM937.png?resize=500%2C339" style="opacity: 1;" width="500" /></a></p> <p><a href="http://globalriskinsights.com/2013/11/russia-plans-to-win-the-arctic-race/">Russian claims</a>, however, are larger and are more developed than those of other nations. While the UN Law of the Sea governs many of these disputes, the US is the only claimant that is not party to the treaty. Interestingly, the US Defence Department has urged the Senate to adopt the treaty, so that the <a href="http://globalriskinsights.com/2016/11/23956/">US</a> can gain at seat at the table on Arctic (and other) deliberations. With a nearly unprecedented number of former generals set to play civilian roles in the Trump administration, such a shift is perhaps more likely than in years past.</p> <h4><span style="text-decoration: underline;"><strong>Kashmir</strong></span></h4> <p>Contested since the inception of India and Pakistan, <a href="http://globalriskinsights.com/2016/08/kashmir-riots-highlight-risk-of-growing-instability/">Kashmir</a> has long been a disputed territory. This turbulent history saw the addition of another sorry chapter in 2016, as unrest increased during the past year. One reason was the death of <a href="http://globalriskinsights.com/2016/07/burhan-wani-kashmir-violence/">Burhan Muzaffar Wani</a> &ndash; the leader of the Hizbul Mujahideen militant group &ndash; during an encounter with Indian military forces: protests erupted in the aftermath of the incident in July. Successive skirmishes have since led to a cycle of protest and violence leaving the territory in an especially volatile position as 2017 begins.</p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="704" height="343" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170119_territory.jpg?1484885155" /> </div> </div> </div> http://www.zerohedge.com/news/2017-01-19/5-territorial-disputes-watch-2017#comments Business China Chinese government Climate change skepticism and denial Donald Trump Donald Trump European Union Foreign policy of the Barack Obama administration Geography of Europe Hizbul Mujahideen India Israel Norway Political positions of Donald Trump Politics Politics of Crimea Politics of the United States Republic of Crimea Rex Tillerson Russian irredentism Senate South China Territorial dispute Trump Administration Ukraine UN Commission on the Limits of the Continental Shelf United Nations US Defence Department WWE Hall of Fame Fri, 20 Jan 2017 08:30:00 +0000 Tyler Durden 585943 at http://www.zerohedge.com