http://www.zerohedge.com/fullrss2.xml/news/Al-Qaeda%20Prepares%20For%20War%20Against%20Caliphate en Chinese Contagion Risks Surge: Banks' Reliance On Each Other For Funding Hits All Time High http://www.zerohedge.com/news/2016-09-25/chinese-contagion-risks-surge-banks-have-never-been-more-reliant-each-other-funding <p>It's getting increasingly more difficult for China to deny its massively overindebted reality. </p> <p>The latest striking confirmation that things in the world's former growth dynamo are deteriorating rapidly, come yesterday from none other than PBOC advisor Huang Yiping, who during a speech in Beijing said that China's "deleveraging isn't making progress" and that the "high leverage ratio is becoming a big financial problem for the country" noting that the household leverage ratio has "surged sharply in China." Adding something ZH readers have <a href="http://www.zerohedge.com/news/2015-10-01/chinese-cash-flow-shocker-more-half-commodity-companies-cant-pay-interest-their-debt">known for the past year</a>, Yiping said that "mining and property sectors have the highest leverage ratio" in the country and while the M2/GDP ratio is "not the best gauge to measure leverage for China" he notes that the "leverage ratios in state-owned companies have kept growing since 2008."</p> <p>None of this is a secret: one look at the chart below from the IIF according to which China's gross leverage is now roughly 300% of GDP, confirms just that.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/China%20debt%20iif.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/China%20debt%20iif_0.jpg" width="500" height="365" /></a></p> <p>Worse, in a troubling report by SocGen from September 21, the French bank found that depository banks’ claims on the government are surging, <strong>up 80% and nearly CNY7tn yoy. </strong>As SocGen notes, the simultaneous and rapid rise in the PBoC’s claims on domestic banks has raised questions as to whether China is conducting a modified form of quantitative easing. </p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/surge%20govt%20issuance.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/surge%20govt%20issuance_0.jpg" width="500" height="378" /></a></p> <p>SocGen's explanation is partial affirmation of this question: </p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>"In our view, the surge in banks’ claims on the government is because of the debt-to-bond programme for local governments. These claims only include banks’ holding of central government bonds (CGBs) and local government bonds (LGBs). Any borrowing of quasi-government institutions from banks in the form of either loans or (corporate) bonds was and is still categorised as corporate borrowing. </p> <p>&nbsp;</p> <p>The National Audit Office conducted two nation-wide audits on local government debt in 2010 and 2013, and the State Council finalised the count of local government debt at CNY16tn as of end-2014, on which the swap programme was based, designed and kicked off in 2015. However, the label was never changed in creditors’ record despite the formal recognition. Only when local government bonds (LGBs) are issued and banks buy them do banks’ claims on the government increase. </p> <p>&nbsp;</p> <p>Even if the proceeds of LGBs issued under the swap programme have not gone to repay the borrowing of quasi-gove rnment institutions, banks’ claims on the gove rnme nt still increase nonetheless as long as banks buy up the LGBs.</p> </blockquote> <p>This means that it is the rapidly expanding swap programme that enables local governments to issue so many LGBs so quickly.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/surge%20govt%20issuance%202.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/surge%20govt%20issuance%202_0.jpg" width="500" height="374" /></a></p> <p> The programme commenced in May 2015 and reached over CNY3tn by the end of 2015. In the eight months this year, the stock of LGBs under the programme added another CNY3.6tn. Along with the increases in budget bonds issued by central and local governments, the increases in government securities are in line with the increase in banks’ claims on the government.</p> <p>* * * </p> <p>Of course, this massive transfer of obligations to the government should mean that the local banks are more stable as a result of their liabilities being effectively insured by the government. Well, not necessarily. </p> <p>As it turns out, while China's big banks, most of which are state-owned enterprises already, may indeed have become inextricably interconnected with the fabric of China's own sovereign stability, <strong>China’s smaller banks have never been more reliant on each other for funding, prompting rating companies to warn of contagion risks in any crisis.</strong></p> <p><strong>"Contagion risks are definitely rising," </strong>said Liao Qiang, Beijing-based senior director for financial institution ratings at S&amp;P Global Ratings. "The pace of the development is concerning. If this isn’t stopped in time, the central bank will lose some control and flexibility of its monetary policy."</p> <p>According to <a href="http://www.bloomberg.com/news/articles/2016-09-25/contagion-risks-rise-as-chinese-banks-fund-each-others-lending">Bloomberg</a>, wholesale funds - notably those raised in the interbank market - accounted for a record 34% of small- and medium-sized bank financing as of June 30, compared with 29% on Jan. 31 last year, Moody’s Investors Service estimated in an Aug. 29 note that analyzed central bank data. Shanghai Pudong Development Bank Co.’s first-half earnings showed its short-term borrowings and repurchase agreements surged by 75% in the past three years, while its consumer deposits rose just 24% . </p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/China%20interconnected%20banks.png"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/China%20interconnected%20banks_0.png" width="500" height="333" /></a></p> <p>As Bloomberg adds, "policy makers have sought to sustain an economic recovery by keeping the seven-day repurchase rate at round 2.4 percent for the past year, a level that has encouraged borrowing for investment in property, corporate bonds or risky loans, often packaged as shadow banking products. <strong>CLSA Ltd. estimates total debt may reach 321 percent of gross domestic product in 2020 from 261 percent in the first half</strong>, while the Bank for International Settlements also warned lenders are at risk from surging leverage."</p> <p>What China's attempts to stabilize its financial system have achieved is forced banks to rely not on deposits as sources of funds, but intermediaries such as the dreaded shadow banks, aka WMPs, and worse, other banks: a precarious balance which threatens a domino-like effect should even one counterparty fail.</p> <p>Shanghai Pudong Development Bank told Bloomberg in an e-mailed response on Sept. 24 it has been using appropriate financing and its regular deposits and interbank borrowing have been developing properly and in synchronization. Total liabilities will be kept under control in the long run and all liquidity gauges meet regulatory requirements, it said. Rising short-term borrowing doesn’t mean its risks have climbed as well, the bank said.</p> <p>Meanwhile, as reported previously, the PBOC resumed longer-term reverse repos to boost borrowing costs in August and deputy governor Yi Gang said in a television interview earlier this month that the nation’s short-term goal is to curb leverage. The benchmark 10-year government bond yield climbed slightly, to 2.75% from a 10-year low of 2.64% on Aug. 15, effectively setting a rate floor for China's plunging sovereign bond yields which recently also hit an all time low. Interbank market stability only makes it more appealing for traders to borrow money and invest in illiquid assets of longer tenors, S&amp;P and Moody’s warned.</p> <p>The good news - for now - is that a worse case scenario would likely be cushioned by depositor bail-ins. China’s financial system is backstopped by some 148.5 trillion yuan ($22.3 trillion) of savings, even though regulators removed a rule that limited loans to 75 percent of deposits in 2015. Industrywide, the ratio was 67% on June 30, up from 64% five years ago, China Banking Regulatory Commission data show. Including shadow banking, it is closer to 100 percent for some lenders, such as Shanghai Pudong, Moody’s wrote. The rating company said the big four state banks still have "strong deposit franchises and a more prudent growth strategy."</p> <p>Of course, the rapid flight of deposits offshore is the biggest risk that has been facing China, and is why the PBOC has spent hundreds of billions in reserves over the past 18 months trying to stabilize the Yuan, which has been hit as a result of depositors rushing to park their savings abroad, aware that it is only a matter of time before China's banking syste, suffers a major crisis. </p> <p>Meanwhile, China's shadow banking problems continue to grow: <strong>short-term borrowings and repos accounted for 37% of Industrial Bank Co.’s total liabilities as of June 30, up from 34% three years ago, according to its filings. </strong>The lender’s loan-to-deposit ratio rose to 73.8 percent, from 67.8 percent at the end of 2015. The ratio for Hong Kong banks’ local currency business was 78.2 percent on June 30, while that for Australian lenders was 114.9 percent, according to official data.</p> <p>Why is this a danger? As Christine Kuo, a Hong Kong-based senior vice president at Moody’s said, <strong>the higher the reliance on wholesale funds, the greater the risk of a liquidity crunch.<br /></strong></p> <p><strong>"When banks face fund withdrawals by other financial institutions, this will in turn prompt them to call back their own funds," </strong>she said. In other words, just as the "breaking" of money markets in the aftermath of Lehman is what many say catalyzed the freeze of interbank funding as a result of virtually no regulation of shadow banking in the US, it is now China's turn to aggressively rely on short-term and even overnight sources of funding. </p> <p>It gets worse: in a sign that China's financial system has already <a href="http://www.zerohedge.com/news/2014-03-19/chinas-minsky-moment-here-morgan-stanley-finds">moved beyond the Ponzi point on its way to the inevitable Minsky moment</a>...</p> <p>&nbsp;</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2014/03/china%20minsky%201.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2014/03/china%20minsky%201_0.jpg" width="550" height="318" /></a></p> <p>... banks are also buying each others’ wealth-management products and accounting for the transactions as investment receivables. </p> <p>As a reminder, the "Ponzi finance" stage in a financial regime, is where borrowers have insufficient cash flows to pay either principal or interest and therefore must either borrow or sell assets to make interest payments. This is where China finds itself now. As Bloomberg writes, a record 26.3 trillion yuan of WMPs were outstanding as of June 30, doubling over two years, China Banking Wealth Management Registration System data showed. Investment receivables at 25 listed Chinese banks grew 13.4 percent in the first half to 11 trillion yuan, earnings reports show. </p> <p>Some exampled: </p> <ul> <li>China Minsheng Banking Corp.’s receivables surged 77% in the first half, while its short-term borrowings and repos more than doubled in the past two years, company filings show.</li> <li>Industrial Bank declined to comment and China Minsheng didn’t reply to an e-mail seeking comment.</li> </ul> <p>As He Xuanlai, a Singapore-based analyst at Commerzbank AG, says <strong>"banks’ use of wholesale funds to buy WMPs only makes the contagion risks higher.</strong>"&nbsp; </p> <p>* * * </p> <p>We anticipate that all of the above warnings, as has traditionally been the case, will be ignored until it is too late to engage in proactive damage control, instead forcing China to "fix" a problem of massive leverage by throwing even more debt at the problem as the country joins the rest of the "developed" world in doing "whatever it takes" to keep its insolvent financial system alive by kicking the can as far as it possibly can.</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="801" height="463" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/China%20Minsky_0.jpg?1474835472" /> </div> </div> </div> http://www.zerohedge.com/news/2016-09-25/chinese-contagion-risks-surge-banks-have-never-been-more-reliant-each-other-funding#comments Bond Borrowing Costs China Fail Gross Domestic Product Hong Kong Lehman Loan-To-Deposit Ratio M2 Monetary Policy None Quantitative Easing ratings Reality recovery Shadow Banking SocGen Yuan Sun, 25 Sep 2016 21:13:40 +0000 Tyler Durden 573168 at http://www.zerohedge.com The Wedge That's Driving Facebook's Stock http://www.zerohedge.com/news/2016-09-25/wedge-thats-driving-facebooks-stock <p><a href="http://jlfmi.tumblr.com/post/150829176215/the-wedge-thats-driving-facebooks-stock"><em>Via Dana Lyons&#39; Tumblr,</em></a><strong><em>&nbsp;</em></strong></p> <p><strong><em>The stock of Facebook has been in a rising wedge pattern for most of its lifetime &ndash; and the pattern is nearing a resolution.</em></strong></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2016/09/23/20160925_fb.jpg"><strong><em><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2016/09/23/20160925_fb.jpg" style="width: 600px; height: 500px;" /></em></strong></a></p> <p>Today&rsquo;s Chart Of The Day takes a rare detour into single stock territory. As we do not trade individual equities for our clients, it is typically not a focus of ours. But with Facebook (FB) in the news today (along with a dearth of exciting charts) we take a look at a chart pattern relevant to FB throughout most of its history &ndash; and in particular, right now.</p> <p><strong>A&nbsp;&ldquo;rising wedge&rdquo; pattern involves a series of higher highs and higher lows on a price chart &ndash; with the lows demonstrating a steeper ascent.</strong> Given the sharper rise in the lows, the trendline connecting the highs and the trendline connecting the lows will necessarily intersect at some point, which we call the&nbsp;&ldquo;apex&rdquo;. That is where one can expect resolution to the pattern, if the wedge has not already been broken. Despite the higher highs and lows, the pattern is generally considered to be a bearish one. That is, prices more often than not resolve, or break out of, the wedge to the downside.&nbsp;</p> <p><strong>In the case of Facebook, one can consider nearly its entire history as one big rising wedge. </strong>After its IPO in 2012, FB began its launch higher in earnest in June 2013. Since that point, it has demonstrated a long-term series of higher highs and higher lows. However, the lows have been rising faster than the highs, resulting in the rising wedge seen on its chart here.</p> <p><img alt="image" src="http://67.media.tumblr.com/521a4425b705cc32ee607e136903b8a7/tumblr_inline_odz15xr6PO1sq14jh_500.jpg" style="width: 601px; height: 358px;" /></p> <p>&nbsp;</p> <p><strong>If this interpretation is correct, the apex is fast approaching.</strong> The upper and lower bounds of the wedge will intersect before the end of the year, with the exact time dependent upon where one draws the lines. We drew them on a weekly chart and the intersection should come by the end of November. That means we should have resolution of this wedge by that time. Absent a breakout before then, the range in FB trade should continue to squeeze tighter and tighter.</p> <p><strong>Should FB break the wedge to the downside, significant support (at this time) may lie just north of 100, then just south of 90.</strong> Those areas are not targets, but speculative support levels and subject to change based on the action in FB prior to a breakdown. A breakout above the top of the wedge obviously opens up considerable upside, with no resistance at all-time highs. Additionally, if one is to monitor this development, be on guard for a false breakout that eventually fails. That is, a breakout above the top bound, followed by an eventual reversal below the bottom bound. See <a href="http://jlfmi.tumblr.com/post/130358499755/israel-stock-market-in-a-precarious-spot" target="_blank">this post</a> for an example of a failed rising wedge breakout.</p> <p><strong>There&rsquo;s no doubt that Facebook &ndash; the&nbsp;&ldquo;F&rdquo; in F.A.N.G. &ndash; has been one of the more steady and reliable stock climbers in recent years. As it is approaching the apex of its rising wedge, one can expect more volatility from FB once it finally breaks out of the wedge, whichever direction it breaks.</strong></p> <p>*&nbsp; *&nbsp; *</p> <p><em><a href="http://jlfmi.tumblr.com/About" target="_blank">More</a> from Dana Lyons, JLFMI and My401kPro.</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="500" height="417" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20160925_fb.jpg?1474822752" /> </div> </div> </div> http://www.zerohedge.com/news/2016-09-25/wedge-thats-driving-facebooks-stock#comments Volatility Sun, 25 Sep 2016 21:00:00 +0000 Tyler Durden 573152 at http://www.zerohedge.com "Hillary 2016" Caption Contest http://www.zerohedge.com/news/2016-09-25/hillary-2016-caption-conest <p>As the <a href="https://twitter.com/victomato/status/780119655423676416/photo/1">source </a>of this already viral photo simply exclaims <strong>"2016, ya'll."</strong></p> <p><strong><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/hillary%20selfies.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/hillary%20selfies_0.jpg" width="500" height="331" /></a></strong></p> <p><em>h/t @<a href="https://twitter.com/victomato/status/780119655423676416/photo/1">victomato</a></em><a href="https://twitter.com/victomato/status/780119655423676416/photo/1"></a><strong><a href="https://twitter.com/victomato/status/780119655423676416/photo/1"></a><br /></strong></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="795" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/hillary%20selfies.jpg?1474835634" /> </div> </div> </div> http://www.zerohedge.com/news/2016-09-25/hillary-2016-caption-conest#comments Sun, 25 Sep 2016 20:33:56 +0000 Tyler Durden 573170 at http://www.zerohedge.com Merkel Caves To Pressure On Migrant Policy: "Germany Has Done Enough", As Support For AfD Hits All Time High http://www.zerohedge.com/news/2016-09-25/merkel-seemingly-caves-political-pressure-migrant-policy-germany-has-done-enough <p>After getting pummeled in recent elections and polls, Angela Merkel seems to be finally coming around to the notion that German citizens may not be that supportive of her "open-door" policies which have resulted in over 1 million migrants flowing into Germany in just a year.&nbsp; Speaking in Vienna at a meeting with nine other heads of government, Merkel proclaimed that "Germany has done enough" and called on the rest of the EU to do more saying "other EU countries will have to jump in.”</p> <p>The Vienna summit included leaders of nations along the Balkans migrant route and was called in a bid to unblock disagreements at the heart of the immigration problem.&nbsp; Per the <a href="http://www.express.co.uk/news/world/714171/Angela-Merkel-Germany-enough-migrant-crisis-Europe-take-more">Sunday Express</a>, Austrian Chancellor Christian Kern commiserated with Merkel saying “<strong>you will never be able to close a border completely, but for Germany it’s been too much and I understand the concern</strong>.”&nbsp; </p> <p>As for Austria, Kern has called for a financial deal with Northern African countries as well as Afghanistan and Pakistan along the same lines of the EU-Turkey deal that would involve returning migrants in exchange for travel visas and financial aid.&nbsp; </p> <p><img src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2016/09/24/20160925%20-%20Balkan%20Migrant%20Route.png" alt="Balkan Migrant Route" width="584" height="523" /></p> <p>The controversial EU-Turkey deal gives Greece the ability to send back<br /> Syrian migrants to Turkey in exchange for the EU providing Turks with visa-free<br /> travel across Europe as well as financial aid.&nbsp; That said, the agreement has stirred some controversy in Europe as Turkey has refused to change its counter-terror policy, and even pulled its border control guards from Greek islands in the Aegean Sea.&nbsp; The disputes have left thousands stranded on Greek islands after Austria and its Balkan neighbors shut their borders, closing off the migrant route to western Europe.</p> <p><img src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2016/09/24/20160925%20-%20Merkel.jpg" alt="Merkel" width="590" height="350" /></p> <p>As a result of the growing tensions with Turkey, Hungarian Prime Minister Viktor Orban, who is famous for his hardline on immigration and has built reinforced fences on his borders, has called for preparations to be made in the event the EU-Turkey deal collapses.&nbsp; Orban said that backup plans must be established now because <strong>"when the migrants descend on us and trouble arrives it will be too late to reach for blueprints, for fences, for physical barriers, for new police and soldiers."</strong></p> <p>All of this comes after the CDU's latest disastrous showing in last week's Berlin election, which as <a href="http://www.zerohedge.com/news/2016-09-18/merkel-suffers-another-humiliating-defeat-berlin-surge-anti-ammigrant-afd-continues">reported last week saw Germany's conservative party end </a>second with only 17.6% of the vote, dropping 5.7% from the 2011 election, and marking its worst performance in the capital since German reunification.&nbsp; Angela Merkel took responsibility for her party’s disastrous showing in Berlin's state election, "<strong>admitting mistakes in her handling of last year’s refugee crisis.</strong>" </p> <p>As <a href="https://www.theguardian.com/world/2016/sep/19/angela-merkel-admits-mistakes-asylum-seekers-election?CMP=twt_gu">reported by the Guardian</a>, in an unusually self-critical but also combative speech, the German chancellor said she was “fighting” to make sure that there would be no repetition of the chaotic scenes on Germany’s borders like last year, when “<strong>for some time, we didn’t have enough control” </strong>adding that <strong>“no one wants this to be repeated, and I don’t either.”&nbsp; </strong><strong><br /></strong></p> <p>Merkel also admitted she had in the past failed to sufficiently explain her refugee policy, and that her phrase “Wir schaffen das” (“We can do it ”) had “provoked” some of those who didn’t agree with her political course.&nbsp; Her words will be interpreted as an olive branch to the leader of her CDU’s sister party, the Bavarian CSU, who have in recent months repeatedly called on her to distance herself from the much-cited slogan.</p> <p>The 62-year-old also rebutted the CSU’s calls for a “static upper limit” to the amount of asylum seekers Germany could accept in 2016, arguing that it “would not solve the problem”. Banning people from entering the country on the basis of their religion, she said, would be incompatible with Germany’s constitution and her own party’s “ethical foundation”.</p> <p>Of course, Merkel is seemingly starting to wake up to the fact that the only alternative is watching as her approval rating implodes in not so slow-motion, and as her CDU continues to tank in future elections.</p> <p>And speaking of the surge in AfD, late last week <a href="http://www.reuters.com/article/us-germany-election-poll-idUSKCN11S2PP?feedType=RSS&amp;feedName=worldNews&amp;utm_source=Twitter&amp;utm_medium=Social&amp;utm_campaign=Feed%3A+Reuters%2FworldNews+%28Reuters+World+News%29">Reuters </a>reported that the the anti-immigrant Alternative for Germany party would capture 16% of the vote if a federal election were held now, according to an opinion poll on Friday, <strong>the most support it has drawn in a poll in history.</strong></p> <p>The poll released by public broadcaster ARD said Chancellor Angela Merkel's conservatives would get 32% of the vote, while the Social Democrats, junior partner in the ruling coalition, would get 22%. Together they would have 54 percent, enough for the ruling "grand coalition" to continue, at least for the time being. </p> <p>The AfD made huge gains in two regional elections this month and will now have seats in 10 of 16 state assemblies, benefiting from a backlash against Merkel's open-door refugee policy and the arrival of nearly a million migrants last year. The next federal election is a year from now. The party's latest score of 16 percent is more than three times the 5 percent it would need to win seats in the Bundestag or parliament for the first time.</p> <p></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="1100" height="619" alt="" src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/Euro%20Migrants.jpg?1474821878" /> </div> </div> </div> http://www.zerohedge.com/news/2016-09-25/merkel-seemingly-caves-political-pressure-migrant-policy-germany-has-done-enough#comments Afghanistan Germany Greece Reuters Turkey Sun, 25 Sep 2016 19:50:00 +0000 Tyler Durden 573156 at http://www.zerohedge.com A Turning Point In The US Presidential Campaign. What Happened? http://www.zerohedge.com/news/2016-09-25/turning-point-us-presidential-campaign-what-happened <p><em><a href="http://www.strategic-culture.org/news/2016/09/25/turning-point-in-us-presidential-campaign-what-happened.html">Submitted by Dmitry Minin via Strategic-Culture.org,</a></em></p> <p>If Hillary Clinton&rsquo;s illness had not materialized, <strong>someone would probably have had to have made one up for her.</strong> The<strong> Democratic presidential candidate&rsquo;s dramatic drop in popularity</strong> just over the course of the last month has been attributed to her sudden health issues and pneumonia. Of course they&rsquo;re <strong>claiming that Clinton will recover</strong> and that her extraordinary determination to keep fighting will make voters even more sympathetic to her.<strong> The biggest US media outlets are helping her spin that.</strong></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2016/09/23/20160925_election1.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2016/09/23/20160925_election1_0.jpg" style="width: 600px; height: 318px;" /></a></p> <p><u><strong>But without delving into the details of Ms. Clinton&rsquo;s medical reports, if we just rewind the tape, the timeline of events looks somewhat different. </strong></u>The polls showing Donald Trump&rsquo;s popularity across the nation quickly gaining on Hillary&rsquo;s &ndash; and perhaps even surpassing hers - began to emerge in late August, back when she still seemed quite vigorous and no one was talking about her health. The tipping point in the presidential race did not materialize after Hillary&rsquo;s unfortunate fainting episode, but before it. But it&rsquo;s not the Democratic candidate&rsquo;s health issues that are responsible for the shifting tide, but rather the strategic missteps by Hillary Clinton&rsquo;s campaign staff.</p> <p><strong>The inordinate personification of the entire campaign by the Democratic camp was the initial miscalculation.</strong> Donald Trump does love to get a rise out of his audience, but - seeing him as an easy target - <strong><em>they focused on his persona instead of trying to attack his quite serious political platform.</em></strong></p> <p>In the Democratic campaign it all came down to Trump&rsquo;s personality - after all he&rsquo;s a racist who is unpredictable and incompetent, he gushes over America&rsquo;s enemies and is himself a threat to his nation&rsquo;s security, and so on. So, thus distracted, Clinton and her advisers failed to notice when her Republican challenger radically altered his behavior, suddenly metamorphosing into a level-headed and observant politician who delves deeply into every issue. In his campaign he has refused to exploit Clinton&rsquo;s ill health and has stopped his aides from doing so. He now launches far fewer personal attacks on his opponent. <strong>He currently prefers to lambaste the last traces of President Obama&rsquo;s dwindling popularity, making it clear that Clinton would be nothing more than &laquo;Obama Part Two&raquo;.</strong></p> <p><strong>This billionaire candidate is nothing if not wily</strong>. In the beginning, his outrageous pronouncements drew nationwide attention and mobilized the radical fringe of the population most fed up with America&rsquo;s political regime. Now he&rsquo;s working with politically moderate Americans. Trump speaks to audiences of widely varying ethnic and faith backgrounds, assuring his listeners that his purported hostility to minorities is pure fiction. <strong>This could be seen in Trump&rsquo;s very significant visit to Mexico and his meeting with the president of that country.</strong></p> <p>In the end, he demonstrated that he can have a very friendly relationship with Mexicans (who had been portrayed as his probable first victims upon taking office), and he can negotiate successfully with them.<strong> It turns out that Trump&rsquo;s much-lampooned idea of walling off the US-Mexican border is actually quite acceptable to the Mexican government, which is every bit as concerned as the US government by the criminal elements crossing back and forth across the border. </strong>The only issue is about who is going to pay to build it. But if push comes to shove, Trump will undoubtedly be able to force the Mexicans to cough up the cash. And after Trump came back from Mexico no one was mocking his wall anymore.</p> <p><strong>The Republican candidate is also actively pursuing the union vote, which had always been seen as Democratic turf.</strong> The ace up his sleeve will be his careful preparation prior to meetings with them and his ability to allude to the nuances of any particular trade. Several influential unions have already declared their support. And impressive data is coming in from places that until quite recently were seen as utterly out of reach for Trump. He holds a&nbsp;<a href="http://thehill.com/blogs/ballot-box/polls/296189-polls-darken-for-democrats" target="_blank">commanding lead</a>&nbsp;in Florida, Ohio, Nevada, and even Iowa, which has swung Republican in only one of the last seven presidential campaigns.&nbsp;</p> <p><strong>Other serious Democratic blunders included their constant attempts to portray Trump&rsquo;s goal of normal relations with Russia as a threat to America.</strong> It&rsquo;s difficult to recall any other time in American history when the &laquo;subject of Russia&raquo; was so harped upon in the election campaign, as if it in some way discredited one of the candidates. The exception perhaps would be the election of 1948, when Henry Wallace, FDR&rsquo;s former vice president and the leader of the Progressive Party, was labeled the &laquo;pro-Soviet&raquo; candidate. Wallace, however, won only slightly over a million votes back then, and his leftist convictions have nothing whatsoever in common with Trump&rsquo;s views.</p> <p><strong>Apparently, Hillary Clinton&rsquo;s staff have calculated that Russia and Putin have been so demonized in the American consciousness that linking Trump&rsquo;s name to them in any way will automatically diminish the Republican candidate&rsquo;s chances. But that hasn&rsquo;t worked. Or only a bit.</strong></p> <p>It&rsquo;s possible that Americans truly do not know much about Russia, but they are a rational people, capable of drawing conclusions. And <strong>when told that Russia is a threat to the US, they immediately ask: where? And how?</strong> And that&rsquo;s a hard question to answer. For the Americans who lived through the tragedy of 9/11, the threat of domestic terrorism - or, for example, the search for a job - is infinitely more important than seeking to destroy the fictional monsters abroad that the second US president, John Quincy Adams, warned them about.</p> <p>Any juxtaposition of the two countries&#39; strengths would quickly show that there is simply no threat to the United States emanating from Russia. Those who now specialize in demonizing Russia have clearly forgotten Abraham Lincoln&rsquo;s words:<em><strong> &laquo;You can fool all the people some of the time, and some of the people all the time, but you cannot fool all the people all the time&raquo;.</strong></em> Americans for the most part would be happy to divvy up both the responsibilities and expenses with &laquo;those awful Russians,&raquo; just to wipe out the evil of terrorism that is building itself a cozy nest in the Middle East. And that&rsquo;s exactly what Trump is suggesting.</p> <p><strong>Something called charisma is also working in Trump&rsquo;s favor (and not in Clinton&rsquo;s). </strong>Clinton is taking great pains to appear energetic and convincing, but she&rsquo;s not very good at firing people up. Trump&rsquo;s better at it. Polls&nbsp;<a href="http://thehill.com/blogs/ballot-box/presidential-races/296360-enthusiasm-gap-looms-for-clinton" target="_blank">show</a>&nbsp;that 58 % of his supporters feel &laquo;extremely enthusiastic&raquo; about him, while only 46% of Clinton&rsquo;s &laquo;troops&raquo; can make such a claim. And 20% of those intending to vote for Hillary are &laquo;not at all enthusiastic&raquo; about their choice vs. only 10% of Trump&rsquo;s supporters who admit to feeling that way.&nbsp;</p> <p><strong>The Democrats have also made a tactical blunder when it comes to the independent third-party candidates who were supposed to pull votes away from Trump.</strong> Michael Bloomberg, yet another well-known billionaire, was avowing his readiness to take on this mission, only to later reconsider. It was also thought that such a role could be played by the leader of the Libertarian Party, Gary Johnson, whose outlook is a bit closer to Trump&rsquo;s than Clinton&rsquo;s. His ratings are fairly high - 8%, but the problem is that he could steal just as many votes from Clinton as from Trump. And the fourth and final player in the running, the Green Party nominee Jill Stein, could play a part in this political drama that will make Hillary Clinton very uncomfortable. And what is probably most offensive to the Democrats is that Jill Stein&nbsp;<a href="http://www.voanews.com/a/presidential-campaign-clinton-trump-health/3510503.html" target="_blank">took advantage</a>&nbsp;of their own campaign gambit when she chose as her running mate the only African-American still in the ranks by that late date in the campaign - an activist with the distinctive name of Ajamu Baraka. And everyone understands that Clinton has now lost one segment of President Obama&rsquo;s supporters (estimated at up to 4%).&nbsp;</p> <p>But the Democrats still have one more option up their sleeve, which some experts have been discussing from the very beginning: <u><em><strong>pulling Hillary Clinton off the ballot &laquo;for health reasons&raquo; and nominating a new candidate to be determined by the leaders of the Democratic Party.</strong></em></u> However, there is a difficulty there as well: many within the Democratic establishment are adamantly opposed to the &laquo;socialist&raquo; Bernie Sanders, and there is not enough time left to crank up the publicity machines for Vice President Joe Biden or Secretary of State John Kerry, whose names have been mentioned more often than any others in this regard. <strong>Nor would it be a simple matter to coax the former first lady, who is already envisioning herself as the mistress of the Oval Office, to quit the game.</strong></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="296" height="149" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20160925_election.jpg?1474823167" /> </div> </div> </div> http://www.zerohedge.com/news/2016-09-25/turning-point-us-presidential-campaign-what-happened#comments Bernie Sanders Donald Trump Florida Joe Biden Mexico Middle East Ohio President Obama ratings Sun, 25 Sep 2016 19:10:00 +0000 Tyler Durden 573155 at http://www.zerohedge.com Charlotte Police Release Mugshots Of Captured Looters As Protests Continue For Fifth Night http://www.zerohedge.com/news/2016-09-25/charlotte-police-release-mugshots-captured-looters-protests-continue-fifth-night <p>Following the <a href="http://www.zerohedge.com/news/2016-09-24/charlotte-police-plan-release-keith-scott-body-cam-footage-press-conference-live-fee">delayed release </a>of the Charlotte police dash and body-cam video footage of the fatal shooting of Keith Scott, there were concerns that violence and rioting would return to the cith of Charlotte, despite the recently imposed state of emergency and national guard deployment, leading to even more drastic violence. And while luckily that did not happen to the extent seen earlier in the week, protests showed no signs of abating on Sunday, after the police released videos showing the victim being shot but did not answer the question of whether he had a gun.</p> <p>Hundreds marched through the center of Charlotte on a fifth night of demonstrations that stretched into Sunday morning, including white and black families protesting police violence. One sign read “Stop police brutality” and another showed a picture of a bloody handprint with the phrase #AMINEXT, a social media tag about the fear of becoming a victim of police.</p> <p><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/charl%201_0.jpg" width="500" height="337" /></p> <p>Keeping tempers in check, for the first time in three nights, police enforced a curfew, saying they would arrest violators. A crowd gathered outside police headquarters dispersed without any violence shortly after midnight <a href="http://www.reuters.com/article/us-usa-police-idUSKCN11V045">Reuters reported</a>. </p> <p><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/charl%202_0.jpg" width="500" height="333" /></p> <p>Meanwhile, any hope that the video release would put the ongoing debate over Scott's shooting to rest, was dashed after Charlotte-Mecklenburg Police Chief Kerr Putney acknowledged that the videos themselves were "insufficient" to prove that Scott held a gun but said other evidence completed the picture. Both Scott's family and protesters have disputed the police statements that Scott was carrying a gun.</p> <p><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/charl%203_0.jpg" width="500" height="334" /></p> <p>“There is no definitive visual evidence that he had a gun in his hand,” Putney said. “But what we do see is compelling evidence that, when you put all the pieces together, supports that." </p> <p><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/charl%204_0.jpg" width="500" height="389" /></p> <p>Police said officers trying to serve an arrest warrant for a different person caught site of Scott with marijuana and a gun, sitting in a car in a parking lot. "They look in the car and they see the marijuana, they don’t act. They see the gun and they think they need to,” Putney said. </p> <p><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/charl%205_0.jpg" width="500" height="333" /></p> <p>As <a href="http://www.zerohedge.com/news/2016-09-24/charlotte-police-plan-release-keith-scott-body-cam-footage-press-conference-live-fee">reported last night</a>, Police released photos of a marijuana cigarette, an ankle holster they said Scott was wearing, and a handgun, which they said was loaded and had Scott's fingerprints and DNA. But Scott's family, which released its own video of the encounter on Friday, said the police footage showed the father of seven was not acting aggressively and that the police shooting made no sense, with no attempt to de-escalate the situation. The family video, shot by Scott's wife, was also inconclusive on the question of a gun.</p> <p>In one of the police videos, a dashboard-mounted camera from a squad car showed Scott exiting his vehicle and then backing away from it. Police shout to him to drop a gun, but it is not clear that Scott is holding anything. Four shots then ring out and Scott drops to the ground.</p> <p>A second video, taken with an officer's body camera, fails to capture the shooting. It briefly shows Scott standing outside his vehicle before he is shot, but it is not clear whether he has something in his hand. The officer then moves and Scott is out of view until he is seen lying on the ground.</p> <p><iframe src="https://www.youtube.com/embed/C6CIx0EWOcM" width="500" height="281" frameborder="0"></iframe></p> <p>While the public debate over why Scott was shot by the police will continue, marchers on Saturday evening focused their demands squarely on stopping police violence, after on previous evenings protesters' priority was release of police tapes. "No justice, no peace, no racist police," demonstrators chanted. </p> <p>Meanwhile, as the protesters and police remained at an impasse, the Charlotte Police department took to naming and shaming some of the many captured looters and rioters, who turned Charlotte into a warzone on the night of September 21 and 22.</p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">Detectives are working diligently to identify looting suspects, sign warrants and make arrests.This is their board of open cases. <a href="https://t.co/aTa4NjbBEw">pic.twitter.com/aTa4NjbBEw</a></p> <p>— CMPD News (@CMPD) <a href="https://twitter.com/CMPD/status/779885650787069952">September 25, 2016</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script><blockquote class="twitter-tweet"> <p dir="ltr" lang="en">Khalil Wallace has been arrested, accused of hitting an officer with a wrench during a protest earlier this week. He faces felony a charge. <a href="https://t.co/oIduwL0KtC">pic.twitter.com/oIduwL0KtC</a></p> <p>— CMPD News (@CMPD) <a href="https://twitter.com/CMPD/status/779923175798894592">September 25, 2016</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script><blockquote class="twitter-tweet"> <p dir="ltr" lang="en">Jayden Harrington and Shakiyla Green were arrested early this morning and charged in connection with damage and looting of Jimmy Johns. <a href="https://t.co/JYzIYUEAQd">pic.twitter.com/JYzIYUEAQd</a></p> <p>— CMPD News (@CMPD) <a href="https://twitter.com/CMPD/status/779904419865489408">September 25, 2016</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script><blockquote class="twitter-tweet"> <p dir="ltr" lang="en">Arrested in connection with damage and looting at Buffalo Wild Wings: Marcellis McKenzie (9/15/86) <a href="https://t.co/q4SoOX3Z69">pic.twitter.com/q4SoOX3Z69</a></p> <p>— CMPD News (@CMPD) <a href="https://twitter.com/CMPD/status/779902540267810816">September 25, 2016</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script><blockquote class="twitter-tweet"> <p dir="ltr" lang="en">Another suspect Identified and charged: Savanna Lee Jones is wanted in connection with the damage and looting at Jimmy John's. <a href="https://t.co/LWd8LmUBQj">pic.twitter.com/LWd8LmUBQj</a></p> <p>— CMPD News (@CMPD) <a href="https://twitter.com/CMPD/status/779476223097466880">September 24, 2016</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script><blockquote class="twitter-tweet"> <p dir="ltr" lang="en">One of three identified so far -- Jamil Gill (4/15/1993) is wanted on numerous charges in connection with damage and looting at Jimmy Johns. <a href="https://t.co/LucvtvqVne">pic.twitter.com/LucvtvqVne</a></p> <p>— CMPD News (@CMPD) <a href="https://twitter.com/CMPD/status/779117815143997440">September 23, 2016</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script><blockquote class="twitter-tweet"> <p dir="ltr" lang="en">One of three identified so far -- Daniel Baker is jailed on numerous charges in connection with damage and looting at Jimmy Johns. <a href="https://t.co/WAbhYHty0p">pic.twitter.com/WAbhYHty0p</a></p> <p>— CMPD News (@CMPD) <a href="https://twitter.com/CMPD/status/779114503610957825">September 23, 2016</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script><blockquote class="twitter-tweet"> <p dir="ltr" lang="en">One of three identified so far! Dejuante Marina is wanted on numerous charges in connection with damage and looting at Jimmy Johns. <a href="https://t.co/VLxUIboGBR">pic.twitter.com/VLxUIboGBR</a></p> <p>— CMPD News (@CMPD) <a href="https://twitter.com/CMPD/status/779112432476315649">September 23, 2016</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script><blockquote class="twitter-tweet"> <p dir="ltr" lang="en">Wanted on numerous charges in connection with damage and looting at Buffalo Wild Wings: Marcellis McKenzie. <a href="https://t.co/VXJtPVx0zz">pic.twitter.com/VXJtPVx0zz</a></p> <p>— CMPD News (@CMPD) <a href="https://twitter.com/CMPD/status/779107526583386112">September 22, 2016</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script><blockquote class="twitter-tweet"> <p dir="ltr" lang="en">Identified and charged: Ian Bowzer of Charlotte is charged with damage to property in connection with doors kicked in at Hyatt House. <a href="https://t.co/kZF53YoCJQ">pic.twitter.com/kZF53YoCJQ</a></p> <p>— CMPD News (@CMPD) <a href="https://twitter.com/CMPD/status/779104390179332097">September 22, 2016</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script> <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="3000" height="415" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/charlotte%20riot%20teaser%27.jpg?1474809203" /> </div> </div> </div> http://www.zerohedge.com/news/2016-09-25/charlotte-police-release-mugshots-captured-looters-protests-continue-fifth-night#comments Reuters Twitter Twitter Sun, 25 Sep 2016 19:04:11 +0000 Tyler Durden 573138 at http://www.zerohedge.com Why Hedge Funds Remain The Worst Performing Asset Class Of 2016 http://www.zerohedge.com/news/2016-09-25/why-hedge-funds-remain-worst-performing-asset-class-2016 <p>It's been a bad year for hedge funds as a result of significantly underperforming the market, coupled with the biggest wave of redemptions since the financial crisis. Unfortunately, according to the latest Goldman data, there is no reprieve in sight. As the following chart from David Kostin shows, both global macro hedge funds and equity long short funds are the worst performing assets YTD on both a total return and risk-adjusted basis.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/equity%20HF%201.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/equity%20HF%201_0.jpg" width="500" height="378" /></a></p> <p>There are two main reasons why hedge funds continue to underperform: on one hand correlations across various sectors have soared to the highest levels in the past three years, leading to a plunge in return dispersion making "stock-picking" virtually impossible...</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/GS%20correlation.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/GS%20correlation_0.jpg" width="500" height="370" /></a></p> <p>... while on the other hand, the most popular hedge fund short positions have soared in recent months, crushing short books and more than offsetting the modest rebound in the "hedge fund VIP" basket of most popular positions.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/GS%20short%20performance.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/GS%20short%20performance_0.jpg" width="500" height="376" /></a></p> <p>And while hedge funds have continued to underperform, several outright sectors continue to dramatically outperform the S&amp;P, most notably IT, followed by Consumer Staples, Telecom and Utilities, even if the latter three have seen some modest weakness in recent months as a result of the pick up in yields.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/sector%20gs.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/sector%20gs_0.jpg" width="500" height="358" /></a></p> <p>... leading to the following most recent return by sector, where despite the recent surge in IT, Utilities still have the YTD lead, followed closely by Telecom and Energy. </p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/sector%20performance%202.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/sector%20performance%202_0.jpg" width="500" height="365" /></a></p> <p>Shifting away from sectors, and focusing only on valuation factors, we find that size (in this case small is better), high margins and low dividend yield have become increasingly expensive, while on the other end, low momentum, low margins and high volatility are now the cheapest inputs into quant models.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/valuation%20factors.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/valuation%20factors_0.jpg" width="500" height="343" /></a></p> <p>Shifting back out, we then look at the overall market where we find the valuations on both an absolute and relative basis remain especially rich, with the S&amp;P trading at a 17.3x forward PE, and while financials and telecom remain cheap, at 12.6x and 13.9x fwd PE respectively, they are more than offset by the lunacy in Energy stocks which trade at over 43x, while consumer staples is the second richest sector currently. </p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/GS%20valuation%20table.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/GS%20valuation%20table_0.jpg" width="500" height="366" /></a></p> <p>Finally, putting it all together shows that mutual fund outflows continue, with some $127 billion withdrawn from equity mutual funds, and even ETFs now negative YTD; both of these are more than offset by the $110 billion in inflows in bond mutual funds and ETFs, while as a result of the upcoming change to money market fund regulation, those particular funds keep bleeding cash, having lost some $124 billion YTD. Also worth noting, a marketwide short squeeze as a drive of upside is no longer a key concern as a result of the S&amp;P's median short interest as a % of market cap sliding to 2.4%: the lowest since last summer. </p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/GS%20fund%20flows.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/09/20/GS%20fund%20flows_0.jpg" width="500" height="366" /></a></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="1607" height="1215" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/equity%20HF%201.jpg?1474826397" /> </div> </div> </div> http://www.zerohedge.com/news/2016-09-25/why-hedge-funds-remain-worst-performing-asset-class-2016#comments Bond Short Interest Volatility Sun, 25 Sep 2016 18:28:14 +0000 Tyler Durden 573160 at http://www.zerohedge.com Something Odd Emerges When Fact Checking The "Fact Checkers" http://www.zerohedge.com/news/2016-09-25/politifact-apparently-even-facts-are-subjective-and-based-party-affiliation <p>The American electorate has never been more divided with people having wide ranging <strong>opinions</strong> on which party/candidate would be best for the future of the country.&nbsp; Certainly economic and other <strong>facts </strong>help guide those opinions but, in the end, the decision is also based on the subjective views of each voter. &nbsp; </p> <p>But, for Politifact, apparently even the facts are subjective and based on party affiliation.&nbsp; Take the following example: </p> <p>On <strong>July 6, 2015</strong>, <strong>Bernie Sanders</strong> made the following comment about <strong>Black youth unemployment in the United States</strong>:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>"For young people who have graduated high school or dropped out of high school, who are between the ages of 17 and 20, if they happen to be white, the unemployment rate is 33 percent.&nbsp; If they are Hispanic, the unemployment rate is 36 percent. <strong>If they are African-American, the real unemployment rate for young people is 51 percent.</strong>"</p></blockquote> <p>Shortly after that comment was made, <strong><a href="http://www.politifact.com/truth-o-meter/statements/2015/jul/13/bernie-s/bernie-sanders-says-real-unemployment-rate-african/">Politifact</a> </strong>decided to "<strong>fact check</strong>" Bernie's assertion that black youth unemployment was sky high and found that it was "<strong>Mostly True.</strong>"</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>Sanders said that for African-Americans between the ages of 17 and 20, "the real unemployment rate … is 51 percent." His terminology was off, but the numbers he used check out, and his general point was correct -- that in an apples-to-apples comparison, African-American youth have significantly worse prospects in the job market than either Hispanics or whites do. The statement is accurate but needs clarification or additional information, <strong>so we rate it Mostly True.</strong></p> </blockquote> <p>The problem is that when Donald Trump made a similar assertion at a rally on <strong>June 11, 2016,</strong> <a href="http://www.politifact.com/virginia/statements/2016/jun/20/donald-trump/trump-misleadingly-puts-black-youth-unemployment-r/">Politifact</a>'s "<strong>fact checking</strong>" analysis had a slightly different conclusion.&nbsp; Here is what <strong>Trump said</strong>:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>"If you look at what’s going on in this country, <strong>African-American youth is an example: 59 percent unemployment rate; 59 percent</strong>."</p> </blockquote> <p>But this time around <a href="http://www.politifact.com/virginia/statements/2016/jun/20/donald-trump/trump-misleadingly-puts-black-youth-unemployment-r/">Politifact </a>claimed that "<strong>Trump exaggerates</strong>" the level of black youth unemployment through a "<strong>misleading use of statistics.</strong>"&nbsp; Politifact concludes that Trumps comments are therefore "<strong>Mostly False.</strong>"</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>The unemployment rate is a widely used term with a specific definition: It refers to the percentage of jobless people in the workforce who are actively seeking employment.<strong> In May, the unemployment rate for blacks ages 16 to 24 was 18.7 percent, or less than one-third of Trump’s claim.</strong></p> </blockquote> <p>Wait, now it is 18.7% when Politi"fact" said a year prior that Benie's 51% claim was "mostly true?"</p> <p>Interesting. </p> <p>Both candidates were referring to studies like the one below from the <a href="http://www.epi.org/blog/young-black-high-school-grads-face-astonishing-underemployment/">Economic Policy Institute</a> which attempt to find true unemployment rates based on the number of people employed to the total population adjusted for those still enrolled in continuing education.&nbsp; On this basis, true white youth unemployment is in the mid-30s while black youth unemployment is in the low-50s after hovering around 60% for several years.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2016/09/24/20160925%20-%20Unemployment%20by%20Race.JPG"><img src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2016/09/24/20160925%20-%20Unemployment%20by%20Race_0.JPG" alt="Unemployment by Race" width="600" height="477" /></a></p> <p>Politifact was able to "recall" this study when "fact checking" Bernie but, like Hillary in an FBI interview, they "did not recall" the study when fact checking Trump.&nbsp; </p> <p>We rate Politifact's fact-checking Mostly Biased.</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="1488" height="120" alt="" src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/20160925%20-%20Bernie%20vs.%20Trump.jpg?1474820153" /> </div> </div> </div> http://www.zerohedge.com/news/2016-09-25/politifact-apparently-even-facts-are-subjective-and-based-party-affiliation#comments Bernie Sanders Donald Trump FBI Real Unemployment Rate Unemployment Sun, 25 Sep 2016 17:50:00 +0000 Tyler Durden 573147 at http://www.zerohedge.com The Natural Gas War Burning Under Syria http://www.zerohedge.com/news/2016-09-25/natural-gas-war-burning-under-syria <p><a href="http://oilprice.com/Energy/Energy-General/The-Natural-Gas-War-Burning-Under-Syria.html"><em>Submitted by James Durso via OilPrice.com,</em></a></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2016/09/23/20160925_syria.jpg"><em><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2016/09/23/20160925_syria.jpg" style="width: 554px; height: 275px;" /></em></a></p> <p>Qatar always wanted to punch above its weight. <strong>In Syria, it got the chance.</strong></p> <p><strong>In 2009, <a href="http://www.eia.gov/beta/international/country.cfm?iso=QAT">Qatar</a>, a leading natural gas producer, approached Syria about routing its planned 1,500 mile pipeline to the gas markets of Europe through Syria&rsquo;s Aleppo province.</strong> Qatar wanted a <a href="http://www.thenational.ae/business/energy/qatar-seeks-gas-pipeline-to-turkey">pipeline</a> straight to Europe as its current gas transport modes were limited to Liquefied Natural Gas (LNG) tanker, mostly to Asia with limited spot <a href="http://www.naturalgaseurope.com/poland-prepares-for-norwegian-qatari-cargoes-29784">shipments</a> to <a href="https://wikileaks.org/plusd/cables/09DOHA495_a.html">Europe</a> or the Dolphin pipeline to the United Arab Emirates and Oman. The pipeline would head north and end in Turkey after crossing Saudi Arabia, Jordan, and Syria.<strong> Syria <a href="http://www.hurriyetdailynews.com/moscow-rejects-saudi-offer-to-drop-assad-for-arms-deal.aspx?pageID=238&amp;nid=52245">declined</a> Qatar&rsquo;s offer, </strong>which would have cut the European market share of its partner, Russia, and instead agreed to participate in the <a href="http://www.naturalgaseurope.com/iran-iraq-and-syria-gas-pipeline">&ldquo;Friendship Pipeline&rdquo;</a> between Iran and Iraq that was considered a &ldquo;Shia Pipeline&rdquo; to some and a target for the Sunni monarchies of the Gulf. Not understood, or ignored, was Syria&rsquo;s longstanding support of the Iranian regime, especially during the 1980-1988 Iran-Iraq War, and its long relationship with Russia, dating from 1944, which should have been a warning of who might appear if things hotted up.</p> <p><strong>In 2010, Israel and Syria held <a href="http://www.nytimes.com/2012/10/13/world/middleeast/secret-israel-syria-peace-talks-involved-golan-heights-exit.html?_r=0">back-channel</a> talks that reportedly included Israel&rsquo;s return of the Golan Heights to Syria in exchange for security guarantees.</strong> The talks lagged due to mutual suspicions about the other side&rsquo;s ability to deliver and, by early 2011, the Arab Spring had erupted across the region and leaders&rsquo; attentions turned to more immediate concerns. At this point, America had the opportunity to strike a blow against the Islamic Republic&rsquo;s ally, the Assad regime. In 2011, Turkey provided a home for the opposition Syrian National Council and, in August 2011, the U.S., its allies, and the UN were calling on Bashar Assad to <a href="http://www.nytimes.com/2011/08/19/world/middleeast/19diplo.html">step down</a>.</p> <p><strong>In 2011, Syria, Iran, and Iraq agreed to build a pipeline to connect Iran&rsquo;s South Pars gas field to Europe. </strong>The pipeline would run from Assalouyeh, Iran to Europe via Iraq, Syria, and Lebanon, with Syria as the <a href="http://www.voltairenet.org/article173718.html">center</a> of assembly and production.</p> <p><strong>What remains unclear is why, when Syria turned down its original pipeline proposal, it didn&rsquo;t pursue its second option for the pipeline route: Saudi Arabia &ndash; Kuwait &ndash; Iraq.</strong> Aside from the challenging terrain in Iraq, the mostly likely reasons are the discovery of vast gas <a href="http://blogs.platts.com/2015/11/16/eastern-mediterranean-basin-oil-gas/">reserves</a> in the eastern Mediterranean, and Saudi <a href="http://www.thenational.ae/business/energy/qatar-seeks-gas-pipeline-to-turkey">opposition</a> to a pipeline through Kuwait. If a more Qatar-friendly regime were to gain control of Syria, Qatar would be able to garner more profit and have influence over the state, something it is unable to do with Saudi Arabia, which vehemently opposes Qatar&rsquo;s historic support of the Muslim Brotherhood, Jordan, a U.S. ally, or Iraq, an Iranian ally. At that point it was nothing personal, just business, and the Assads had to go.</p> <p><u><strong>This was Qatar&rsquo;s best chance to influence the affairs of the region.</strong></u> It has a tiny native population &ndash; guest workers make up almost <a href="http://www.bq-magazine.com/economy/2013/12/population-qatar">90 percent</a> of Qatar&rsquo;s population of 2.2 million &ndash; and an <a href="http://www.aljazeera.com/indepth/features/2012/07/2012722917422894.html">unhealthy</a> one, so some options are limited as it has a very <a href="http://fas.org/sgp/crs/mideast/RL31718.pdf">small military</a>. It does, however, have a healthy check book and was able to use it to help <a href="https://www.ft.com/content/f2d9bbc8-bdbc-11e2-890a-00144feab7de">finance</a> the Syrian opposition forces.</p> <p>To better understand the war in Syria, remember the surge in natural gas <a href="http://soundwaves.usgs.gov/2010/05/research3.html">discoveries</a> in the Eastern Mediterranean starting in 2009. Israel, Cyprus, and Egypt have found large gas deposits, and offshore Lebanon has the potential for significant gas resources. Israel has the potential to export gas to Egypt, Jordan, the Palestinian Authority, and Turkey. (Israel and Turkey have discussed a pipeline to Turkey, but Cyprus has objected as it does not have diplomatic relations with Turkey.)</p> <p>If the pipeline from Iran to Syria it could create an energy hub in Syria, and could block Qatar gas sales to Europe at a time when Qatar&rsquo;s gas <a href="https://www.eia.gov/dnav/ng/ng_move_impc_s1_a.htm">exports</a> to the U.S. have dropped to zero, largely due to increasing U.S. domestic <a href="http://www.eia.gov/dnav/ng/hist/n9050us2a.htm">production</a> of natural gas. <strong>Thus Qatar would be limited to the Asian LNG market </strong>as it scrapped for the EU market with Iran, Iraq, Syria, and Russia. And the only thing that could make it worse is happening: <strong>Europe is <a href="http://www.bloomberg.com/news/articles/2016-01-15/more-than-half-of-u-s-lng-is-destined-for-europe-woodmac-says">forecast</a> to take more than half of U.S. LNG exports by 2020.</strong></p> <p><strong>Qatar, Saudi Arabia, and their confederates are in it to win it, and the fighting in Syria has <a href="https://www.theguardian.com/environment/earth-insight/2013/aug/30/syria-chemical-attack-war-intervention-oil-gas-energy-pipelines">focused</a> on the <a href="http://www.inspiretochangeworld.com/2016/09/syrian-war-nothing-daesh-energy-battle-future-pipelines/">pipeline routes</a>.</strong> Aleppo province, which would host the Qatari pipeline, is where Turkey wants to establish a <a href="http://blogs.timesofisrael.com/chinese-stratagems-and-syrian-buffer-zone-for-turkey-qatar-pipeline/">buffer zone</a> to support &ldquo;moderate&rdquo; rebel forces. If Turkey can control this territory, it will bolster the Qatari pipeline and ensure its own preeminence as the energy hub in southern Europe, where it<strong> would gather oil and natural gas from Russia, Central Asia, the Caspian, the Eastern Mediterranean, and the Middle East, and become less reliant on Russian gas,</strong> which accounted for over 50 percent of its imports in <a href="http://www.al-monitor.com/pulse/originals/2016/04/turkey-russia-curtail-gas-bonanza.html">2014</a>. <u><strong>But Russia hasn&rsquo;t been standing still</strong></u>: it has surrounded Turkey on three sides by occupying Crimea, sending more troops to Armenia, and deploying the S-400 air defense system to Syria, creating a no-fly zone, and maybe a &ldquo;no-buy&rdquo; zone for potential customers of Qatari gas.</p> <p>The Pasha&rsquo;s increasingly autocratic behavior may spur hedging behavior in Europe, such as balancing the Pasha with the Tsar and completing Russia&rsquo;s Nord Stream pipeline, negotiating better deals with key suppliers Norway and Algeria, importing LNG from the U.S., and getting serious about <a href="http://www.dw.com/en/what-ever-happened-with-europes-fracking-boom/a-18589660">fracking</a> for shale gas. Turkey turned the flow of refugees to Europe on and off to get what it wanted, and the possibility remains that it will one day do the same with energy.</p> <p><u><strong>And Qatar may have to write some more checks in addition to the ones it has sent to Assad&rsquo;s opposition.</strong></u> Turkey has some serious policy and infrastructure <a href="https://www.foreignaffairs.com/articles/turkey/2015-10-11/kink-pipeline">shortfalls</a> that work against it becoming a serious energy hub soon: weak domestic gas regulation, state subsidies, monopoly control of the gas transmission network, only two LNG terminals, and a lack of storage capacity.<strong> Syria may be too wrecked to be a hub and Turkey lacks the infrastructure for the role. </strong>Russia may be interested in investing in increasing Turkey&rsquo;s hub capacity and Turkey, which is making amends with Russia, may take the money over Qatar&rsquo;s for a pipeline that may never be built.<em><strong> Russia&rsquo;s good relations with Cyprus and Israel could propel movement towards a resolution of the Cyprus dispute so the gas pipeline from Israel to Turkey becomes a reality, having the knock-on effect of attracting more outside investment to Turkey.</strong></em></p> <p><strong>To succeed in its pipeline goals, Qatar will have to make serious investments in the Turkish end of its project as well as resisting political pressure from Russia.</strong> Until then, it will be limited to making LNG shipments to Europe by tanker. <strong><u>In the meantime, these pipeline geopolitics have contributed to serious consequences for the Middle East.</u></strong></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="554" height="275" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20160925_syria.jpg?1474822090" /> </div> </div> </div> http://www.zerohedge.com/news/2016-09-25/natural-gas-war-burning-under-syria#comments Iran Iraq Israel Kuwait Market Share Middle East Natural Gas Norway Reality Saudi Arabia Turkey Sun, 25 Sep 2016 17:10:00 +0000 Tyler Durden 573151 at http://www.zerohedge.com "It's Serious Business" - Trump VP Pence Confirms Bill Clinton's Ex-Girlfriend "Will Not Be At Debate" http://www.zerohedge.com/news/2016-09-25/its-serious-business-trump-vp-pence-confirms-bill-clintons-ex-girlfriend-will-not-be <p><a href="http://www.zerohedge.com/news/2016-09-24/following-trump-threat-gennfier-flowers-reportedly-confirms-debate-attendance">Despite the confirmatin from Gennifer Flowers yesterday</a>, Donald Trump VP Mike Pence <a href="http://thehill.com/blogs/ballot-box/presidential-races/297642-pence-gennifer-flowers-wont-be-at-the-debate">confirmed </a>this morning that <strong>Bill Clinton's ex-girlfriend "will not be attending the debate tomorrow night." </strong></p> <p><iframe src="https://www.facebook.com/plugins/video.php?href=https%3A%2F%2Fwww.facebook.com%2FFoxNewsSunday%2Fvideos%2F10153329552917168%2F&amp;show_text=0&amp;width=560" width="560" height="315" frameborder="0" scrolling="no"></iframe></p> <p><a href="http://thehill.com/blogs/ballot-box/presidential-races/297642-pence-gennifer-flowers-wont-be-at-the-debate">As The Hill reports,</a> Pence, Republican presidential nominee&nbsp;<span><a href="http://thehill.com/people/donald-trump">Donald Trump</a></span>'s running mate, attempted to draw a clear contrast between the policies of Trump and those of Democratic presidential nominee&nbsp;<span><a href="http://thehill.com/people/hillary-clinton">Hillary Clinton</a></span>.</p> <div><em><strong>"Hillary Clinton apparently thinks this is an episode of 'Shark Tank,' but this is America," Pence said.</strong></em></div> <div>&nbsp;</div> <div><em><strong>"It's serious business."</strong></em></div> <div> <p>Pence said <span style="text-decoration: underline;"><strong>Trump's tweet about bringing Flowers to the debate was "really mocking the fact that Hillary Clinton was trying to distract attention away from this moment in our national life where the American people are going to see a strong contrast between" both candidates.</strong></span></p> </div> <p>* * *</p> <p>So, if not Gennifer... then is Monica on her way?</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="233" height="147" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20160825_flowers.jpg?1474820947" /> </div> </div> </div> http://www.zerohedge.com/news/2016-09-25/its-serious-business-trump-vp-pence-confirms-bill-clintons-ex-girlfriend-will-not-be#comments Donald Trump Sun, 25 Sep 2016 16:31:04 +0000 Tyler Durden 573148 at http://www.zerohedge.com