http://www.zerohedge.com/fullrss2.xml en Hillary's Banned Words http://www.zerohedge.com/news/2015-04-26/hillarys-banned-words <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04-overflow/20150426_Hill2.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04-overflow/20150426_Hill2_0.jpg" width="600" height="447" /></a></p> <p>&nbsp;</p> <p><em>Source: Townhall</em></p> http://www.zerohedge.com/news/2015-04-26/hillarys-banned-words#comments Sun, 26 Apr 2015 19:30:10 +0000 Tyler Durden 505535 at http://www.zerohedge.com Capital Controls Arrive: Greece Begins Confiscating Deposits Of "Small Debtors" http://www.zerohedge.com/news/2015-04-26/capital-controls-arrive-greece-begins-confiscating-deposits-small-debtors <p>Last week, the Greek government <a href="http://www.zerohedge.com/news/2015-04-20/stunned-greeks-react-initial-capital-controls-and-decree-confiscate-reserves-and-the">issued a decree</a> which called for local governments to transfer excess cash to the central bank so that Athens would be able to pay pensions, salaries, and the IMF. The move is expected to raise as much as €2 billion to help keep the country afloat while the country’s “<a href="http://www.zerohedge.com/news/2015-04-24/futures-fizzle-after-greece-hammered-riga-varoufakis-accused-being-time-waster-gambl">amateurish, time-wasting gambler</a>” of a FinMin feebly attempts to find some kind of middle ground with his EU counterparts and as PM Tsipras pulls out all the stops including the old EU Summit sideline end-around with Merkel and the wild card <a href="http://www.zerohedge.com/news/2015-04-18/greek-white-knight-emerges-putin-give-athens-%E2%82%AC5-billion-advance-gas-pipeline-fees">energy gas pipeline advance&nbsp;from Gazprom </a>(which may portend the dreaded “Russian pivot"). &nbsp;</p> <p><strong>If the “temporary” local government reserve sweep constitutes what we have branded<a href="http://www.zerohedge.com/news/2015-04-18/greek-white-knight-emerges-putin-give-athens-%E2%82%AC5-billion-advance-gas-pipeline-fees"> “</a></strong><strong><a href="http://www.zerohedge.com/news/2015-04-21/following-soft-capital-controls-ecb-threatens-greece-ela-cut-even-1-million-workers-">soft</a>” capital controls, we now have the first evidence that the “hard” variety may have arrived</strong> because as Kathimerini reports, Greek debtors are having their deposits seized in lieu of payment. Here’s <a href="http://www.ekathimerini.com/4dcgi/_w_articles_wsite1_1_25/04/2015_549455">more</a>:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><em><strong>As the country’s finances reach a critical point, tax authorities have started seizing the deposits of small debtors,</strong> Kathimerini understands.</em></p> <p>&nbsp;</p> <p><em><strong>No figures were available regarding the new crackdown but cases of debtors targeted included a citizen with a debt of just 200 euros.</strong></em></p> <p>&nbsp;</p> <p><em>The bank account of the man in question was frozen and then reopened once it was established that he had paid his dues. In several cases, including that of a citizen with a debt of 24,000 euros, bailiffs are said to have used threats to secure the cash. The initiative comes as efforts to crack down on rich Greeks with tax debts make slow progress.</em></p> </blockquote> <p><span style="font-size: 1em; line-height: 1.3em;">So there it is: the first indication that Greeks may soon be Cyprus’d. As a reminder, Citi now says capital controls will likely play a part in whatever the “resolution” (if you want to call it that) to the Greek situation turns out to be, barring a best case scenario outcome which seems exceedingly unlikely. As a reminder, here's what happens under "</span><a href="http://www.zerohedge.com/news/2015-04-23/forget-grexit-grimbo-has-arrived" style="font-size: 1em; line-height: 1.3em;">Grimbo</a><span style="font-size: 1em; line-height: 1.3em;">":</span></p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><strong><em>In theory a run on banks could trigger capital controls tomorrow.&nbsp;</em></strong></p> <p>&nbsp;</p> <p><em><strong>The lack of an agreement would also at some point be associated with capital controls </strong>and binding limits on ELA access (<strong>ZH</strong>: the writing is already on the wall for ELA restrictions as well). Compared to the previous scenario, the capital controls (a mix of bank holidays, deposit withdrawal restrictions, restrictions on external transactions) are likely to be more extensive and longer-lived...</em></p> </blockquote> <p>Meanwhile, not every local governor is particularly enthusiastic about turning over reserves to the state. Here's&nbsp;<span style="line-height: 20.7999992370605px; font-size: 1em;"><a href="http://www.ekathimerini.com/4dcgi/_w_articles_wsite1_1_25/04/2015_549452">Kathimerini</a> again:</span></p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><em>But many local authority leaders stood their ground. </em></p> <p>&nbsp;</p> <p><strong><em>The mayor of Aristoteli in Halkidiki, northern Greece, resigned late on Friday, citing personal reasons.</em></strong></p> <p></p> <p>&nbsp;</p> <p><em>According to the controversial decree, local authority reserves will be used to “cover<br /> the state’s urgent needs, amounting to 3 billion euros over the next 15 days.”&nbsp;</em><em style="font-size: 1em; line-height: 1.3em;">The motion passed with 156 votes from coalition MPs following a furious session in Parliament on Friday night.<br /> </em></p> <p>&nbsp;</p> <p><em style="font-size: 1em; line-height: 1.3em;">Tsipras is to meet on Tuesday with Attica Governor Rena Dourou, who was on a visit to the US last week.</em></p> <p>&nbsp;</p> <p><em>Last month the Attica Regional Authority donated 80 million euros to the state.</em></p> <p></p> <p>&nbsp;</p> <p><em><strong>Universities also object to the decree and rectors met on the weekend to discuss their response. </strong>Technical college directors are to meet Monday.</em></p> </blockquote> <p>If the students become restless, it's truly all over.</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="273" height="188" alt="" src="http://www.zerohedge.com/sites/default/files/images/user92183/imageroot/Greece_3.png?1430075235" /> </div> </div> </div> http://www.zerohedge.com/news/2015-04-26/capital-controls-arrive-greece-begins-confiscating-deposits-small-debtors#comments Attica Greece Sun, 26 Apr 2015 19:17:41 +0000 Tyler Durden 505541 at http://www.zerohedge.com It's Not Just The Students Who Are Broke: LSU Draws Up Bankruptcy Plan http://www.zerohedge.com/news/2015-04-26/its-not-just-students-who-are-broke-lsu-draws-bankruptcy-plan <p>We’ve spent quite a bit of time documenting the student loan bubble which has now ballooned to $1.3 trillion and has recently led The White House to reexamine how student debt is handled in bankruptcy. Further, we’ve taken an in-depth look at delinquency rates in an effor to determine just how dire the situation has become. As it turns out, <a href="http://www.zerohedge.com/news/2015-04-15/staggering-student-loan-defaults-deck-27-students-are-month-behind-their-payments">nearly one in three</a> students in repayment is 30 days or more past due and recent data out of the St. Louis Fed indicates that far more delinquent borrowers are becoming “seriously” delinquent (i.e. never going to pay) now than in the past. Meanwhile, Moody’s <a href="http://www.zerohedge.com/news/2015-04-17/student-debt-bubble-about-witness-its-2007-moment">recently warned on</a> some $3 billion in student loan-backed ABS noting that increased use of IBR combined with deferment and forbearance make it increasingly likely that some paper will not be fully paid down at maturity.&nbsp;</p> <p>Now, it appears that it’s not just students that are in dire financial straits, but schools as well because as Bloomberg <a href="http://www.bloomberg.com/politics/articles/2015-04-23/louisiana-state-to-draft-insolvency-plan-as-jindal-plans-cuts">reports</a>, <strong>Louisiana State University is now drawing up bankruptcy plans in the wake of funding cuts from the state</strong>:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><strong><em>Louisiana State University will draw up a financial exigency plan, equivalent to college bankruptcy, as budget cuts proposed by Governor Bobby Jindal threaten to cripple the higher-education system.</em></strong></p> <p>&nbsp;</p> <p><em>Exigency, declared when schools face insolvency, would allow the state’s flagship institution to restructure and fire tenured faculty.</em></p> <p>&nbsp;</p> <p><em>“We know the worst-case scenario, we know the timeframe, and we know what’s at stake,” President F. King Alexander said in a statement. He said he wants legislators to “mitigate the devastation these budget cuts promise.”</em></p> <p>&nbsp;</p> <p><em>State cuts to higher education have sent tuition soaring across the U.S., adding to the more than $1.2 trillion in student-loan debt. While public subsidies covered almost three-quarters of operating costs in the 1980s, the share is now closer to half and falling every year, according to the State Higher Education Executive Officers Association.</em></p> <p>&nbsp;</p> <p><strong><em>Louisiana faces a $1.6 billion budget shortfall in the coming fiscal year, a result of both plunging oil-tax revenue and the state’s failure to enact adequate tax increases or spending cuts after the economic downturn in 2009…</em></strong></p> <p>&nbsp;</p> <p><em><strong>The latest plans would mean an 82 percent cut to the state’s public colleges and universities. Per-student funding would plummet from $3,500 to $660,</strong> according to the New Orleans Times-Picayune, causing concern at Baton Rouge-based LSU. The school may be running out of time to find a solution, as the state’s legislative session ends June 11.</em></p> </blockquote> <p>According to Alexander, those last figures are indeed as bad as they sound. “States around the country spend more than that on their community colleges,” he told the <a href="http://www.nola.com/news/baton-rouge/index.ssf/2015/04/lsu_scaling_back_faculty_hires.html#incart_related_stories">New Orleans Times-Picayun</a>. The President went on to note that if the university opts for financial exigency it will <strong>“never get any more faculty.”</strong></p> <p>The school recently cut its planned new hire count by more than 50% from 125 to just 60 and says that in the event the worst case budget cut scenario plays out, it will have to cut 2,500 courses, an eventuality which the school says is simply not tenable.&nbsp;</p> <p>Of course what all of this means is that tuition will rise, burying students under still more loans, a third of which will be delinquent once they go into repayment. Here’s <a href="http://www.nbcnews.com/business/economy/amid-funding-cuts-will-lsu-have-declare-bankruptcy-n347951">NBC</a>:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><em>But without a rescue from lawmakers, Alexander said programs could be dropped or entire departments shuttered under a worst-case scenario. "Specifically, we don't know which programs or departments we're talking about [but] it would require us to utilize every tool possible," he said.</em></p> <p>&nbsp;</p> <p><em><strong>Even if the worst-case scenario doesn't come to pass, it's possible students could find themselves paying more</strong>, through increases in tuition and fees or decreases in the state's TOPS scholarship program. Lawmakers have historically been reluctant to raise tuition -- currently $8,758 for tuition and fees for in-state students at LSU -- but there is discussion about giving schools themselves more freedom to do so…</em></p> <p>&nbsp;</p> <p><em>"We've gone from being very state funded-intensive to being tuition-dependent, and we've got 40 percent of our students that are Pell [grant] eligible," said Sandra Woodley, president of the University of Louisiana system, which consists of nine universities throughout the state. <strong>Since 2009, tuition and fees have climbed by 61 percent while state funding has dropped by 55 percent, a drop of $90 million.</strong></em></p> <p>&nbsp;</p> <p><strong><em>"We've already shifted to mostly being funded by tuition revenue in a state that has a relatively low income population," Woodley said. Further cuts would just hurt the most vulnerable.</em></strong></p> </blockquote> <p>Meanwhile, Moody's has cut its outlook on the university from stable to positive (apparently being bankrupt counts as "stable") <a href="https://www.moodys.com/research/Moodys-revises-Louisiana-State-Universitys-outlook-to-stable-assigns-A1--PR_322610?WT.mc_id=AM~WWFob29fRmluYW5jZV9TQl9SYXRpbmcgTmV3c19BbGxfRW5n~20150408_PR_322610">citing</a> "limited prospects for sustained revenue growth due to potential reductions in state operating funding, tight state control of tuition pricing, and pricing sensitivity limiting out-of-state enrollment revenue growth." LSU then <a href="http://www.nola.com/politics/index.ssf/2015/04/louisiana_budget_lsu_bonds.html">pulled</a> a $114 million bond offering which would have financed the construction of a new&nbsp;residential hall, family housing and a student health center.</p> <p>* &nbsp;* &nbsp;*</p> <p>So in the end, the decline in oil and gas prices which has been partially driven by QE-fueled deflation has helped to blow a hole in the state's budget (taxes on oil extraction account for some 15% of Louisiana's revenue), which is in turn set to trigger budget cuts that will cripple LSU, possibly causing the university to raise tuition which will encourage students to accumulate still more federally-backed debt. Yet another virtuous circle.</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="476" height="304" alt="" src="http://www.zerohedge.com/sites/default/files/images/user92183/imageroot/LSU.png?1430073985" /> </div> </div> </div> http://www.zerohedge.com/news/2015-04-26/its-not-just-students-who-are-broke-lsu-draws-bankruptcy-plan#comments Bond NBC New Orleans St Louis Fed St. Louis Fed White House Sun, 26 Apr 2015 18:47:52 +0000 Tyler Durden 505540 at http://www.zerohedge.com Goldman Gets Cold Feet:"It Is Difficult To Predict How Negative The Market Reaction To Grexit Would Be" http://www.zerohedge.com/news/2015-04-26/goldman-gets-cold-feetit-difficult-predict-how-negative-market-reaction-grexit-would <p>On Friday, <a href="http://www.zerohedge.com/news/2015-04-24/relentless-greek-debt-payment-schedule">courtesy of Bloomberg</a>, we showed a very detailed Greek repayment schedule which laid out just how difficult the next few months will be for the bankrupt, in the words of its finance minister, country.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04-overflow/20150424_gre.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04-overflow/20150424_gre_0.jpg" width="600" height="972" /></a></p> <p>&nbsp;</p> <p>Below is a far simpler calendar this time courtesy of Goldman, which nonetheless captures vividly why Goldman thinks that "the ride over the next several weeks is likely to be bumpy."</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/greek%20timeline.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/greek%20timeline_0.jpg" width="600" height="391" /></a></p> <p>Some more details on how Goldman, which as a reminder aided and abetted the Greek entry into the Eurozone by masking its unacceptably large budget deficit as well as its non-compliant debt/GDP ratio over a decade ago and whose former partner now is in charge of the ECB and is threatening with causing a terminal bank run in Greece any day now, sees the Greek calendar over the next three months, and why for Greece, now July 20 is the "hard deadline.</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>We believe negotiations could drag on likely through May and possibly into June. A ‘hard’ deadline could be July 20, when Greece faces a payment of €3.6 bn to the ECB, for which, we think, the country will not have sufficient cash. Exhibit 5 shows the timeline of cash disbursements Greece faces until August and the scheduled meetings of European policymakers. Peripheral spread volatility is likely to increase as time goes by, as investors will associate a higher probability of default to a higher probability of Grexit, although this association will depend on what conditions have led to the credit event. </p> <p>&nbsp;</p> <p>We believe that peripheral markets would sell-off as the July 20 deadline approaches but, as long as the dialogue is still ongoing, spreads between Italy and Spain versus Germany are unlikely to widen more than to around 200-250bp. The tightening trend would resume upon Greece and its creditors finding a solution on the pace of reforms, how to fill the new funding gap and, eventually, also how to reduce the debt stock.</p> </blockquote> <p>As a follow up, Goldman asks "where do peripheral bonds trade in the case of a Grexit." Here is its answer.&nbsp; </p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>If Greece defaults on the official sector and negotiations were to break down leading to Grexit, instead, <strong>we would view this as a systemic event for markets. On its occurrence, we believe peripheral bond yields spreads to ‘core’ would widen significantly. </strong>Yield curves would steepen due to the possibility that an activation of OMT would skew the ECB bonds’ purchases toward short-dated maturities. The length and size of the sell-off would depend on how long it would take for policymakers to respond to the shock. </p> </blockquote> <p>Respond to the shock? As in threaten to buy even more bonds which the ECB can't procure, and cause a terminal liquidity crisis across the entire fixed income market? We thought the launch of Q€ was precisely the pre-emptive response to the "shock"- or is Goldman hinting that the ECB's monetization of debt will be insufficient to keep Europe in a state of orderly insolvency? Of course, the ECB can always threaten to buy even more debt, although at this point not even tenured economists believe that this leads to any economic improvements.</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><strong>During the Euro-area sovereign crisis, the spread between 10-year Bonos-Bunds and BTPs-Bunds peaked at 470bp and 512bp, respectively. </strong>This time around, the Euro area is better equipped to react to a large negative shock via the ESM and OMT and the ECB QE should provide a first line of defense. Also, in the periphery, a larger share of sovereign debt is now held by domestics, <strong>which should reduce the probability of a very sharp sell-off</strong>. Finally, economic activity is picking up and, after the fall-out post Greece’s debt restructuring in 2012, policymakers should be more aware of the negative consequences that a ‘credit crunch’ would have on the real economy, <strong>speeding-up their policy response</strong>. All this said, we think that, at the 10-year tenor, the spread between Spanish and Italian bonds yield versus Bunds yield could still widen to around 350-400bp before a policy response is enacted. <strong>We stress that the departure of a country from the ‘irrevocable’ monetary arrangements of the EMU would take us into unchartered waters and it is difficult to predict how negative the market reaction could be</strong>.</p> </blockquote> <p>Needless to say if anyone knows whether Greece is "in" or "out", it's Goldman. Oh, and by now we hope it is all too clear which outcome Goldman and its banking peers would prefer: the one where the ECB doesn't do more monetization of risk assets, or the one where it does...</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="804" height="524" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/greek%20timeline.jpg?1430072153" /> </div> </div> </div> http://www.zerohedge.com/news/2015-04-26/goldman-gets-cold-feetit-difficult-predict-how-negative-market-reaction-grexit-would#comments Bank Run Bond Budget Deficit Creditors default Eurozone fixed Funding Gap Germany Greece Italy Monetization Sovereign Debt Volatility Sun, 26 Apr 2015 18:18:55 +0000 Tyler Durden 505539 at http://www.zerohedge.com White House Admits Russian Hackers Read Obama's Unclassified Emails http://www.zerohedge.com/news/2015-04-26/white-house-admits-russian-hackers-read-obamas-unclassified-emails <p>It appears<a href="http://www.cnn.com/2015/04/07/politics/how-russians-hacked-the-wh/"> a breach of the White House&rsquo;s unclassified computer system last year</a> was <strong>far more intrusive and worrisome than has been publicly acknowledged</strong>. <a href="http://www.nytimes.com/2015/04/26/us/russian-hackers-read-obamas-unclassified-emails-officials-say.html?ref=us&amp;_r=0">As The NY Times reports,</a> some of President Obama&rsquo;s email correspondence was swept up by Russian hackers who also got deeply into the State Department&rsquo;s unclassified system. &quot;This has been one of the <strong>most sophisticated actors we&rsquo;ve seen</strong>,&quot; according to one official, and while Mr. Obama&rsquo;s BlackBerry was not penetrated, officials have conceded that the unclassified system routinely <strong>contains much information that is considered highly sensitive</strong>.</p> <p><strong>The discovery of the hacking in October led to a partial shutdown of the White House email system. </strong>The hackers appear to have been evicted from the White House systems by the end of October. But they continued to plague the State Department, whose system is much more far-flung. The disruptions were so severe that during the Iranian nuclear negotiations in Vienna in November, officials needed to distribute personal email accounts, to one another and to some reporters, to maintain contact. But <a href="http://www.nytimes.com/2015/04/26/us/russian-hackers-read-obamas-unclassified-emails-officials-say.html?ref=us&amp;_r=0"><em>as The New York Times reports,</em></a></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><strong>White House officials said that no classified networks had been compromised, and that the hackers had collected no classified information. </strong>Many senior officials have two computers in their offices, one operating on a highly secure classified network and another connected to the outside world for unclassified communications.</p> <p>&nbsp;</p> <p><strong><u>But officials have conceded that the unclassified system routinely contains much information that is considered highly sensitive:</u></strong> schedules, email exchanges with ambassadors and diplomats, discussions of pending personnel moves and legislation, and, inevitably, some debate about policy.</p> <p>&nbsp;</p> <p><strong>Officials did not disclose the number of Mr. Obama&rsquo;s emails that were harvested by hackers, nor the sensitivity of their content.</strong></p> <p>&nbsp;</p> <p>...</p> <p>&nbsp;</p> <p>Still, <strong>the fact that Mr. Obama&rsquo;s communications were among those hit by the hackers</strong> &mdash; who are presumed to be linked to the Russian government, if not working for it &mdash; has <strong><u>been one of the most closely held findings of the inquiry. </u></strong>Senior White House officials have known for months about the depth of the intrusion.</p> <p>&nbsp;</p> <p>&ldquo;This has been one of the most sophisticated actors we&rsquo;ve seen,&rdquo; said one senior American official briefed on the investigation.</p> <p>&nbsp;</p> <p>Others confirmed that t<strong>he White House intrusion was viewed as so serious that officials met on a nearly daily basis for several weeks after it was discovered. <u>&ldquo;It&rsquo;s the Russian angle to this that&rsquo;s particularly worrisome,&rdquo;</u></strong> another senior official said.</p> <p>&nbsp;</p> <p>...</p> <p>&nbsp;</p> <p>Officials who discussed the investigation spoke on the condition of anonymity because of the delicate nature of the hacking. While <strong>the White House has refused to identify the nationality of the hackers, others familiar with the investigation said that in both the White House and State Department cases, <u>all signs pointed to Russians.</u></strong></p> </blockquote> <p>Finally, it appears the most-classified American secrets remain that way for now...</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><strong>The White House is bombarded with cyberattacks daily,</strong> not only from Russia and China. Most are easily deflected.</p> <p>&nbsp;</p> <p>The White House, the State Department, the Pentagon and intelligence agencies put their most classified material into a system called Jwics, for<strong> Joint Worldwide Intelligence Communications System.</strong> That is where top-secret and &ldquo;secret compartmentalized information&rdquo; traverses within the government, to officials cleared for it &mdash; and it includes imagery, data and graphics. <strong>There is no evidence, senior officials said, that this hacking pierced it.</strong></p> </blockquote> <p>So once again the "most transparent" administration ever is forced to admit what they previously said was a lie and that things were worse...</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="323" height="318" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20150426_obama.jpg?1430064727" /> </div> </div> </div> http://www.zerohedge.com/news/2015-04-26/white-house-admits-russian-hackers-read-obamas-unclassified-emails#comments China New York Times President Obama White House Sun, 26 Apr 2015 18:00:18 +0000 Tyler Durden 505534 at http://www.zerohedge.com Europe Has Completely Lost It http://www.zerohedge.com/news/2015-04-26/europe-has-completely-lost-it <p><a href="http://www.theautomaticearth.com/2015/04/europe-has-completely-lost-it/"><em>Submitted by Raul Ilargi Meijer via The Automatic Earth blog</em></a>,</p> <p>After the high-level EU summit on the migrant issue, hastily convened after close to a thousand people drowned last weekend off the Lybian coast, Dutch PM Mark Rutte was quoted by &lsquo;his&rsquo; domestic press as saying &lsquo;Our first priority is saving human lives&rsquo;. That sounds commendable, and it also sounds just like what everybody knows everybody else wants to hear. One can be forgiven, therefore, for thinking that it&rsquo;s somewhat unfortunate that the one person tasked by Brussels with executing the noble &lsquo;saving lives&rsquo; strategy, doesn&rsquo;t seem to entirely agree with Rutte:</p> <p style="margin-left: 20px;"><a href="http://www.theguardian.com/world/2015/apr/22/eu-borders-chief-says-saving-migrants-lives-cannot-be-priority-for-patrols" target="new"><span style="font-size:13px;color: #FF2222;font-weight:bold"> EU Borders Chief Says Saving Migrants&rsquo; Lives &lsquo;Shouldn&rsquo;t Be Priority&rsquo; For Patrols </span> </a></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><i>The head of the EU border agency has said that saving migrants&rsquo; lives in the Mediterranean should not be the priority for the maritime patrols he is in charge of, despite the clamour for a more humane response from Europe following the deaths of an estimated 800 people at sea at the weekend. On the eve of an emergency EU summit on the immigration crisis, Fabrice Leggeri, the head of Frontex, flatly dismissed turning the Triton border patrol mission off the coast of Italy into a search and rescue operation.</i></p> <p>&nbsp;</p> <p><i>He also voiced strong doubts about new EU pledges to tackle human traffickers and their vessels in Libya. &ldquo;Triton cannot be a search-and-rescue operation. I mean, in our operational plan, we cannot have provisions for proactive search-and-rescue action. This is not in Frontex&rsquo;s mandate, and this is in my understanding not in the mandate of the European Union,&rdquo; Leggeri told the Guardian.</i></p> </blockquote> <p>To refresh your memory, the Triton border patrol mission took the place late last year of Italy&rsquo;s Mare Nostrum mission, which ended in October 2014. For good measure, the budget was slashed from the &euro;9.5 million per month Italy had been putting in, to &euro;2.9 million per month. Saving lives can be simply too expensive when you think about it in your high rise office in that brand new &euro;1 billion+ EU building. These are hard economic times, and we all need to make sacrifices and to cut costs wherever we can.</p> <p>But of course after that summit, Europe announced it was going to triple the budget for the Triton mission. That will of course only simply bring back the budget to where it already was before it was cut by two-thirds, but it&rsquo;s a nice headline anyway.</p> <p>The difference in focus between Rutte and Frontex head Leggeri can be found all around Europe. It would be nonsense to claim Europe agrees on much of anything regarding the refugee issue. Well, they agree it&rsquo;s a nuisance that all these people die and Europe is supposed to do something. The national government leaders would like it much better if such things didn&rsquo;t happen, it&rsquo;s bad publicity. But at the same time, it&rsquo;s nothing that can&rsquo;t be spun and turned to their advantage. Or so they like to think.</p> <p>Reactions to the statements released after the summit were not all positive, to say the least. Amnesty said that the only thing Europe tries to save is its face. Former Belgian PM Guy Verhofstadt, at present a member of the European Parliament, indicated that the equipment Frontex has at its disposal (one helicopter, two ships and seven planes) wouldn&rsquo;t even be enough to survey the Belgian coast (of which there&rsquo;s not a lot).</p> <p>Just to make sure his peers wouldn&rsquo;t think he&rsquo;d gone all soft, Rutte came with another catchy oneliner<strong>: &ldquo;Last time I checked, Lybia was in Africa, not Europe.&rdquo; In other words, &lsquo;saving lives&rsquo; is a great press quote, but don&rsquo;t blame him for lives lost. And that&rsquo;s the crux behind the shift from Italy&rsquo;s mission to the EU&rsquo;s. The former was patrolling off the coast of Lybia, while the latter occupies itself only with the European coastline, and it just so happens that&rsquo;s not where refugees&rsquo; lives are under threat (let&rsquo;s stop saying migrants, that&rsquo;s a grossly misleading term).</strong></p> <p>In its infinite wisdom, the EU has decided in its summit that there will be 5000 &lsquo;resettlement&rsquo; places available for the hundreds of thousands of refugees (migrants) that want to go to Europe. The EU in a post-summit statement said it expects 150,000 refugees this year, but it might as well add up to 500,000 in 2015 alone. How Brussels thinks it&rsquo;s going to send back almost half a million people is a big question mark. So much so we&rsquo;d put our money on no-one having properly thought it over.</p> <p>According to the United Nations High Commissioner for Refugees, millions of refugees are making their way to the Mediterranean from trouble spots across Africa. To put it in somewhat cynical economic terms, think of this as pent-up demand. And also don&rsquo;t forget how <a href="http://www.theguardian.com/commentisfree/2015/apr/20/britain-criminally-stupid-race-immigration" target="new"><span style="font-size:13px;color: #FF2222;font-weight:bold">Patrick Boyle</span></a> framed it: <i>&ldquo;We fear the arrival of immigrants that we have drawn here with the wealth we stole from them.&rdquo;</i></p> <p>The typical story of the refugees is one in which it takes years to get from their mostly sub-Saharan homes to the Lybian coast, working odd jobs on the way. Once they get to Lybia, which has been shot to bits by western forces, they&rsquo;re dependent on all sorts of militia, who often arrest them, take their money etc. Perhaps the most insulting thing to come out of Brussels is the comparison with Somali pirates, and the argument that the refugee stream should be dealt with in the same way.</p> <p>Indeed, much of the European &lsquo;leadership&rsquo; have emphasized one approach more than any other: send in the military, start shooting. The idea being that if the boats of the traffickers are destroyed, everything will return to &lsquo;normal&rsquo;. But the issue here is not the traffickers, it&rsquo;s the refugees. Want to send in the military against them too?</p> <p>If there&rsquo;s anything good that can come from the deeply deplorable death of far too many poor sods in the Meditteranean, it&rsquo;s that it shows us all once more, as if we needed further confirmation, what a dysfunctional entity &ndash; morally as well as practically &ndash; the European Union is. More than anything, the EU makes itself entirely irrelevant. There is no decision structure in Brussels, since there is no ultimate responsibility that has been assigned. And they all sort of like it that way for now, because it means everyone can deflect that responsibility if and when necessary.</p> <p><strong>From the first example above that should be very clear: Rutte says the first priority should be saving lives, but the man who leads the organization that is tasked with executing it, flatly denies that.</strong></p> <p>Greek news organization Kathimerini ran a piece this week that serves to add yet another level of cold cynicism. Lest we forget, it&rsquo;s Europe&rsquo;s poorest countries that are forced to deal with the brunt of the refugee problem. In that summit we mentioned before, half of all European nations refused to take up even one single refugee. Yet another example of the absolute lack of coherence and solidarity that so-called union exhibits.</p> <p>The idea seems to be: <u><strong>Let &lsquo;em all stay in Greece, while we suffocate the nation financially</strong></u>. But Greece cannot solve the issue all by itself, it can&rsquo;t handle the expected 100,000 refugees on its own. It will be forced to open its borders and tell the refugees to try and reach Germany or France. See also: <a href="http://www.theautomaticearth.com/2015/04/open-letter-from-greece-on-the-mediterranean-migrants-issue/" target="new"><span style="font-size:13px;color: #FF2222;font-weight:bold"> Open Letter From Greece on the Mediterranean Migrants Issue</span></a>.</p> <p>The present EU policy is that a refugee must stay in the country where (s)he has been registered. Hence, all Greece and Italy need to do is not register them. Kathimerini:</p> <p style="margin-left: 20px;"><a href="http://www.ekathimerini.com/4dcgi/_w_articles_wsite3_1_23/04/2015_549383" target="new"><span style="font-size:13px;color: #FF2222;font-weight:bold"> The Dubious Politics Of Fortress Europe </span> </a></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><i>In &ldquo;Border Merchants: Europe&rsquo;s New Architecture of Surveillance&rdquo; (published by Potamos), Apostolis Fotiadis, an Athens-based freelance investigative journalist, seeks to document a paradigm shift in Europe&rsquo;s immigration policy away from search and rescue operations to all-out deterrence. The switch, the 36-year-old author argues, plays into the hands of the continent&rsquo;s defense industry and is being facilitated by the not-so-transparent Brussels officialdom. &ldquo;Their solution to the immigration problem is that of constant management because this increases their ability to exploit it as a market. The defense industry would much rather see the protracted management of the problem than a final solution,&rdquo; Fotiadis said in a recent interview with Kathimerini English Edition.</i></p> <p>&nbsp;</p> <p><i>&ldquo;Without a crisis there would be no need for emergency measures, no need for states to upgrade their surveillance and security systems,&rdquo; he said. Fotiadis claims the trend is facilitated by the revolving door between defense industry executives and the Brussels institutions, which means that conflict of interests is built right into EU policy. &ldquo;There is a certain habitat in which many people represent the institutions and at the same time express a philosophy about the common good,&rdquo; he said. </i></p> <p>&nbsp;</p> <p><i>[..]</i></p> <p>&nbsp;</p> <p><i>Fotiadis believes there is no reason Greece should not be able to set up some basic infrastructure to deal with the influx. He says that the number of immigrants and refugees received by the EU is in fact small compared to the more than 1.5 million refugees who have found shelter in Turkey due to civil war in Syria. Jordan is estimated to be home to over 1 million Syrian refugees, while one in every four people in Lebanon is a refugee. Meanwhile, the EU, one of the wealthiest regions of the world, with a combined population of over 500 million, last year took in less than 280,000 people. &ldquo;<b>All that hysteria is a knee-jerk overreaction to an illusory version of reality</b>,&rdquo; he said.</i></p> </blockquote> <p>Why Greece or any other country would wish, be eager even, to be part of the EU is becoming ever harder to comprehend. The moral values prevalent in Brussels, whether it comes to EU policies regarding Ukraine, Greece or the refugees&rsquo; dilemma, don&rsquo;t seem to be shared in any individual European nation (if anything, they&rsquo;re reminiscent of what various extreme right wing parties espouse).</p> <p><strong>And as the Greek negotiations with the eurogroup and the &lsquo;institutions&rsquo; show us with intense and increasing clarity, the notion of the euro being a boat to lift all tides turns out to be full-on bogus.</strong> Southern Europe&rsquo;s nations will be either thrown out or allowed to stay only as debt servants. For now, Germany and Holland prefer to keep everyone on board, but that may still change. It would therefore seem like a good idea for Greece and Italy to make their moves while they can.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04-overflow/20150426_eco.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04-overflow/20150426_eco.jpg" style="width: 578px; height: 340px;" /></a></p> <p>In order to achieve that, however, they must convince their people that staying in the EU, and in the eurozone, is a bad choice. And since their old-time political establishments will continue to deny this (because the EU allowed them to sit fat and pretty), that will not be an easy task. Perhaps the refugee issue can help.</p> <p>In all likelihood, the victims of the sunken boat near the Lybian coast this weekend will never be identified, except for perhaps a handful. Nobody knows who they are, and those who do stayed behind a thousand miles or more away. These deceased people, most of whom will never even be buried ashore, define, in one fell swoop, the &lsquo;new&rsquo; price of a human life. Theirs, yours, and everyone else&rsquo;s.</p> <p>Sinking nameless to the bottom of the sea, with no-one either ever knowing who you are or aware of how you are doing. That is our new valuation of a human being. It&rsquo;s price discovery in its most cynical sense, it&rsquo;s how assets get re-priced in markets.</p> <p>What Tsipras and Varoufakis must accomplish is to make people understand that<strong> what Europe does to the refugees, it will do to its own citizens too.</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="578" height="340" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20150426_eco.jpg?1430062624" /> </div> </div> </div> http://www.zerohedge.com/news/2015-04-26/europe-has-completely-lost-it#comments ETC European Union Eurozone France Germany Greece Italy Reality Turkey Ukraine Sun, 26 Apr 2015 17:15:34 +0000 Tyler Durden 505533 at http://www.zerohedge.com Why A Chinese Developer's Default Means Trouble For New York Real Estate http://www.zerohedge.com/news/2015-04-26/why-chinese-developers-default-means-trouble-new-york-real-estate <p>Following the <a href="http://www.zerohedge.com/news/2015-04-20/chinas-2nd-largest-property-developer-officialy-files-bankruptcy">default on major Chinese developer Kaisa this week</a>, and with the continued softness in the Chinese property market, many are asking who&#39;s next among the highly-leveraged firms. However, as <a href="http://therealdeal.com/blog/2015/04/23/what-a-chinese-developers-default-means-for-new-york/">The Real Deal&#39;s Konrad Putzier notes</a>, <strong>Kaisa&rsquo;s default carries significance for New York&rsquo;s real estate industry</strong>. Chinese investors spent $3 billion on New York properties in 2014. <strong><em>Many in New York continue to associate Chinese real estate companies with limitless funds and a never-ending ability to invest... But what if they are wrong?</em></strong></p> <p>&nbsp;</p> <p><em>As the NY Times reported:</em></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>Kaisa&rsquo;s debt problems underscore the slump in China&rsquo;s property sector, which has been hit by the slowing economy and a series of cooling measures instituted by Beijing to avoid a bubble in what had been an overheated housing market. <strong>Government data released this week showed that average new-home prices fell in February at the fastest pace on record.</strong></p> <p>&nbsp;</p> <p>Under Kaisa&rsquo;s current restructuring proposal, about $800 million of bonds originally due in 2018 would instead come due in 2023, and the interest would be cut to 5.2 percent from 8.875 percent.</p> </blockquote> <p>Things only got worse in March when housing prices dropped to a new record low:</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/20150418_china2.jpg"><img height="341" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/20150418_china2_0.jpg" width="600" /></a></p> <p>&nbsp;</p> <p>Which puts even more pressure on the so-called megadevelopers...</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><strong>&ldquo;Some developers that have overborrowed in the expansion are going to be in trouble,&rdquo; </strong>David Dollar, an economist at the Brookings Institution and former U.S. Treasury emissary to China, told The Real Deal. &ldquo;We are now going to see some of them default or reschedule their debts.&rdquo;</p> </blockquote> <p>As somehow these firms need to find liquidty... and face a massive wall of debt...</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><strong>Chinese developers currently have $66 billion in dollar (or offshore) bonds outstanding</strong>, according to Dealogic data. The recent <strong>strengthening of the dollar has made these bonds harder to service</strong>, since these firms make the vast majority of their income in Chinese Yuan. It&rsquo;s no coincidence that Kaisa defaulted on a dollar bond.</p> <p>&nbsp;</p> <p><strong>Chinese developers that have invested in New York are among the most active issuers of dollar bonds,</strong> according to Dealogic data.</p> <p>&nbsp;</p> <p>Greenland Holdings, which bought a majority stake in Forest City Ratner&rsquo;s Pacific Park (formerly Atlantic Yards) project in late 2013, issued $2.7 billion in dollar bonds in 2014. Soho China, a stakeholder in the GM building, issued $1 billion in 2012. China Vanke, China&rsquo;s largest publicly-traded developer, has issued another $1 billion to-date. The firm has partnered with Aby Rosen&rsquo;s RFR Realty to develop a 61-story condo tower at 610 Lexington Avenue. Finally, Xinyuan Real Estate, whose subsidiary XIN is developing the Oosten condo project in Williamsburg, has issued $475 million in dollar bonds.</p> </blockquote> <p>And if cashflow coverage gets as tight as expected (and priced in by the firms&#39; bonds),&nbsp; then the following developments may see asset liquidations...</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><strong>Xinyuan Real Estate NYC investments</strong>:&nbsp; Oosten at 429 Kent Avenue</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04-overflow/20150426_china1.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04-overflow/20150426_china1.jpg" style="width: 599px; height: 474px;" /></a></p> <p>&nbsp;</p> <p>Among Chinese developers active in New York, Xinyuan Real Estate appears to be most vulnerable to a market shock at home. Fitch rates the firm&rsquo;s bonds as highly speculative (B+) and last August revised its outlook down to negative. &ldquo;Xinyuan spent substantial amounts on land acquisitions in 1H14 to expand its business scale in 2014, but sales failed to keep pace amid negative sentiment in the sector and its selling,&rdquo; the agency wrote, explaining the revision. The firm&rsquo;s debt grew by more than a third in the first half of 2014 alone while earnings fell from 91 cents to 20 cents per share, according to Seeking Alpha.</p> <p>&nbsp;</p> <p><strong>China Vanke NYC investments</strong>: 610 Lexington Avenue (also known as One Hundred East Fifty Third Street)</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04-overflow/20150426_china2.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04-overflow/20150426_china2.jpg" style="width: 599px; height: 491px;" /></a></p> <p>&nbsp;</p> <p>China Vanke is rated investment grade by Moody&rsquo;s and Fitch. Despite the slowing market, Vanke managed to increase profits by 8 percent last year and its total debt of 69 million Yuan ($11.1 billion) stood at a manageable 46.7 percent of capitalization (the sum of a company&rsquo;s debt and equity) in 2014, according to Moody&rsquo;s.</p> <p>&nbsp;</p> <p><strong>Greenland Group NYC investments</strong>: Pacific Park</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04-overflow/20150426_china3.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04-overflow/20150426_china3.jpg" style="width: 600px; height: 525px;" /></a></p> <p>&nbsp;</p> <p>Greenland is also rated investment grade, though it received slightly lower ratings than Vanke, and its debt level was much higher at 70 percent of capitalization. Still, Moody&rsquo;s expects the firm &ldquo;to manage its debt leverage down from the current level through contracted sales growth.&rdquo;</p> <p>&nbsp;</p> <p><strong>Soho China NYC investments</strong>: The GM Building at 767 Fifth Avenue, Park Avenue Plaza at 55 East 52nd Street</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04-overflow/20150426_china4.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04-overflow/20150426_china4.jpg" style="width: 601px; height: 446px;" /></a></p> <p>&nbsp;</p> <p>Soho China appears to be in even better shape than Vanke and Greenland with a debt-to-capitalization ratio of 27.7 percent in 2014. Moody&rsquo;s gave the firm a rating of Baa1, ahead of Vanke&rsquo;s Baa2 and Greenland&rsquo;s Baa3.</p> </blockquote> <p><a href="http://therealdeal.com/blog/2015/04/23/what-a-chinese-developers-default-means-for-new-york/"><em>Source: The Real Deal</em></a></p> <p>*&nbsp; *&nbsp; *<br />Still - keep buying the $40 million apartments because China&#39;s problems are &quot;contained&quot; and<strong> there&#39;s always a greater fool than you right?</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="503" height="412" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20150426_china2.jpg?1430062312" /> </div> </div> </div> http://www.zerohedge.com/news/2015-04-26/why-chinese-developers-default-means-trouble-new-york-real-estate#comments B+ Bond China default Fitch GM Building Housing Market Housing Prices Investment Grade ratings Real estate Yuan Sun, 26 Apr 2015 16:30:09 +0000 Tyler Durden 505532 at http://www.zerohedge.com Dramatic Images From The Mount Everest Avalanche http://www.zerohedge.com/news/2015-04-26/dramatic-images-mount-everest-avalanche <p>In the immediate aftermath of yesterday's destructive Nepal earthquake, which has led to hundreds of aftershocks and a constantly rising death toll, <a href="http://www.theguardian.com/world/live/2015/apr/26/nepal-earthquake-death-toll-exceeds-1500-rolling-report">currently exceeding 2000</a>, the most visually stunning, if quite deadly, phenomenon was a massive avalanche on Mt. Everest and leading to at least 17 casualties, including a Google executive, and 61 injured.</p> <p>According to <a href="http://news.xinhuanet.com/english/2015-04/26/c_134185379.htm">Xinhua</a>, the avalanche began Saturday on Mount Kumori, a 7,000-meter-high mountain just a few miles from Mount Qomolangma, also known as Mount Everest, gathering strength as it headed toward the base camp where climbing expeditions have been preparing to make their summit attempts in the coming weeks, he said. Numerous climbers may now be cut off on routes leading to the top of the world's highest peak.</p> <p>The avalanche plowed into a part of base camp, a sprawling seasonal village of climbers, guides and porters, flattening at least 30 tents, Tshering said. All of the dead and injured were at base camp.</p> <p>For a sense of the base camp's location relative to the rest of the world's tallest mountain refer to the image below, taken from a <a href="http://www.wsj.com/articles/sherpas-fate-and-the-dangerous-business-of-everest-1400780100?mod=e2tw">May 2014 WSJ story discussing the "dangerous business" of Everest,</a> when 16 sherpas died in what was previously the deadliest disaster in the mountain's history.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%20sherpas.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%20sherpas_0.jpg" width="500" height="407" /></a></p> <p>Survivors reached over Internet messaging services described a scene of terror as the snow and ice roared through the nearby Khumbu Icefall and into the camp.</p> <p>The nationalities of base camp victims were unclear as climbers described chaotic attempts to treat the injured amid fears of more landslides and aftershocks that continue to rattle the region. Chinese media "West China City Daily" reported that a Chinese climber and two Sherpa guides were among the dead.</p> <p>Dan Fredinburg, a Google executive who described himself as an adventurer, was among the dead, Google confirmed. Lawrence You, the company's director of privacy, posted online that Fredinburg was with three other Google employees hiking Mount Qomolangma. Fredinburg served as product manager and the head of privacy at Google X. </p> <p><a href="http://www.weather.com/news/news/nepal-earthquake-mount-everest-avalanche">Weather.com </a>has further details:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>The avalanche — or perhaps a series of avalanches hidden in a massive white cloud — plowed into a part of base camp, a sprawling seasonal village of climbers, guides and porters, flattening at least 30 tents, Tshering said. All of the dead and injured were at base camp. </p> <p>&nbsp;</p> <p>Survivors reached over Internet messaging services described a scene of terror as the snow and ice roared through the nearby Khumbu Icefall and into the camp. </p> <p>&nbsp;</p> <p>Azim Afif, the 27-year-old leader of a climbing team from University of Technology Malaysia, said in an interview on the service WhatsApp that his group was in a meal tent waiting for lunch when suddenly the table and everything around them began shaking. </p> <p>&nbsp;</p> <p>When they ran outside, they saw <strong>"a wall of ice coming towards us," and heard the cries of Sherpa guides shouting for people to run for their lives, he wrote. "We just think to find a place to hide and save our life." </strong></p> <p>&nbsp;</p> <p>The small team planned to sleep together Saturday night in one large tent "to make sure if anything happen, we are together," Afif said. Quickly, though, climbing teams scattered across the camp and began to work together to search for survivors.</p> <p>&nbsp;</p> <p>Gordon Janow, the director of programs for the Washington-based guiding outfit Alpine Ascents International, said from Seattle that his team had come through the avalanche unscathed. Their first goal was to deal with the devastation at base camp, he said, and they would then try to create new routes to help climbers stuck above the treacherous Khumbu Icefall. The icefall, which is just above base camp, is a key route up the lower part of Everest.</p> <p>&nbsp;</p> <p>"Everybody's pretty much in rescue mode, but this is different from some independent climbing accident where people can be rescued and taken somewhere else," Janow said. "I don't know where somewhere else is."</p> </blockquote> <p>Follow some truly epic photos as the avalanche was headed toward base camp...</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%200.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%200_0.jpg" width="500" height="315" /></a></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/everest%201.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/everest%201_0.jpg" width="500" height="289" /></a></p> <p><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/quake%201_0.jpg" width="500" height="502" /></p> <p>&nbsp;</p> <p>... as well as a whole series of photos taken by AFP's Roberto Schmidt who was at base camp on Everest when the avalanche hit, <a href="http://www.telegraph.co.uk/news/worldnews/asia/mounteverest/11563941/Everest-avalanche-Dramatic-photographs-by-AFPs-Roberto-Schmidt.html?frame=3281300">courtesy of Telegraph</a>:</p> <p>&nbsp;</p> <p><em><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%201.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%201_0.jpg" width="500" height="312" /></a></em></p> <p><em>Pictures taken by AFP's South Asia photo chief Roberto Schmidt show an enormous cloud of snow and debris cascading down the mountain as survivors recalled the horrifying moment that disaster struck on Saturday.</em></p> <p>&nbsp;</p> <p><em><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%202_0.jpg" width="500" height="312" /></em></p> <p><em>"I ran and it just flattened me. I tried to get up and it flattened me again," Singapore-based marine biologist George Foulsham told AFP at base camp. "I couldn't breathe, I thought I was dead. When I finally stood up, I couldn't believe it passed me over and I was almost untouched."</em></p> <p>&nbsp;</p> <p><em><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%203.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%203_0_0.jpg" width="500" height="313" /></a></em></p> <p><em>A spokesman for Nepal's tourism department, which issues the permits to climb the world's tallest mountain, said the death toll had risen to 17 and could increase further. "Seventeen have been reported dead so far and 61 are injured," said Tulsi Gautam. "Those who are able are walking down. Others are being airlifted to Pheriche." Here, rescuers use a makeshift stretcher to carry an injured person after an avalanche triggered by an earthquake flattened parts of Everest Base Camp.</em></p> <p>&nbsp;</p> <p><em><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%204.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%204_0_0.jpg" width="500" height="313" /></a></em></p> <p><em>Expedition guide Pasang Sherpa searches through flattened tents in search of survivors</em></p> <p>&nbsp;</p> <p><em><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%205.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%205_0_0.jpg" width="500" height="313" /></a></em></p> <p><em>An injured porter is transfered onto a makeshift stretcher</em></p> <p>&nbsp;</p> <p><em><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%206.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%206_0_0.jpg" width="500" height="313" /></a></em></p> <p><em>Rescuers tend to a sherpa injured in the avalanche</em></p> <p>&nbsp;</p> <p><em><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%207.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%207_0_0.jpg" width="500" height="313" /></a></em></p> <p><em>Many had traveled to Nepal for the start of the annual climbing season, which was cancelled last year after 16 sherpa guides were killed in what was previously the deadliest disaster in the mountain's history</em></p> <p>&nbsp;</p> <p><em><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%208.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%208_0_0.jpg" width="500" height="309" /></a></em></p> <p><em>People look on at the devastation </em></p> <p>&nbsp;</p> <p><em><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%209.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%209_0_0.jpg" width="500" height="313" /></a></em></p> <p><em>Another makeshift stretcher for another casualty</em></p> <p>&nbsp;</p> <p><em><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%2010.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/avalanche%2010_0_0.jpg" width="500" height="313" /></a></em></p> <p><em>Nepalese Sherpas look up towards an area from where an avalanche descended</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="900" height="521" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/everest%201.jpg?1430051337" /> </div> </div> </div> http://www.zerohedge.com/news/2015-04-26/dramatic-images-mount-everest-avalanche#comments China Google Sun, 26 Apr 2015 16:30:05 +0000 Tyler Durden 505526 at http://www.zerohedge.com Our Financial Future: Infinite Greed Meets A Funny Thing Called Karma http://www.zerohedge.com/news/2015-04-26/our-financial-future-infinite-greed-meets-funny-thing-called-karma <p><a href="http://charleshughsmith.blogspot.com/2015/04/our-financial-future-infinite-greed.html"><em>Submitted by Charles Hugh-Smith of OfTwoMinds blog</em></a>,</p> <p><span><i>All those angered by the mere question of the viability of this predatory pillaging in the name of capitalism are <strong>incapable of even admitting this cultural crisis exists</strong>.</i></span></p> <div>&nbsp;</div> <div><span><b>Somewhere along the line, we lost the ability to distinguish between&nbsp;<i>earning a profit</i>&nbsp;and&nbsp;<i>maximizing private gain by any means</i>, i.e.&nbsp;<i>Infinite Greed</i>.</b>&nbsp;If you insist on making this distinction now, you anger a lot of people, as it&nbsp;<i>blows the capitalist cover of Infinite Greed.</i></span></div> <div>&nbsp;</div> <div> <div><span><b>The distinction between&nbsp;<i>earning a profit</i>&nbsp;and&nbsp;<i>maximizing private gain by any means</i>&nbsp;angers not just the few benefiting from the useful delusion&nbsp;</b>that Infinite Greed is simply profit on overdrive; it seems to anger everyone who believes the Status Quo of burning mountains of coal to power towel warmers, sitting in traffic burning petrol two hours a day and central banks enriching the already wealthy is not just sustainable but gol-darned good.</span></div> <div>&nbsp;</div> <div><span><b>If you make the distinction between&nbsp;<i>earning a profit</i>&nbsp;and&nbsp;<i>maximizing private gain by any means</i>, then you realize the status quo is neither sustainable nor good: it is unsustainable and evil.</b>&nbsp;This angers everyone who has rationalized their investment in (and defense of) an evil system, because, well, it&#39;s hard to feel all warm and fuzzy about your choices if the phony facade falls and the evil of the system you&#39;ve defended is starkly revealed.</span></div> <div>&nbsp;</div> <div><span><b>Every enterprise must earn a profit to survive.</b>&nbsp;A worker-owned collective must earn a profit, as it needs money to reinvest in the business and reward those who have invested their capital (human, social, financial, intellectual, etc.) in the enterprise.</span></div> <div>&nbsp;</div> <div><span>If the collective can&#39;t reinvest in new plant and new workers as the old equipment fails and old workers retire, it will weaken and collapse. This is equally true of any business owned by the state (i.e. a socialist enterprise): if the state-owned enterprise doesn&#39;t earn a profit that can be reinvested in the business, it can only survive if it is subsidized by some other enterprise that is earning a profit.</span></div> <div>&nbsp;</div> <div><span><b>But the system we inhabit now is not based on earning a profit; that&#39;s merely the public-relations propaganda used to cloak its real heart: Infinite Greed.</b>&nbsp;<i>Maximizing private gain by any means</i>&nbsp;isn&#39;t about earning a profit; it&#39;s about strip-mining the planet and the labor and profit of others.</span></div> <div><span>If I buy a political favor that essentially eliminates competition in my private fiefdom, that doesn&#39;t generate more goods and services; it&#39;s simply maximizing my private gain at the expense of everyone else in the system.</span></div> <div>&nbsp;</div> <div><span><b>Goosing the stock market ever higher only solves one problem: the terrible prospect that the assets of the incredibly wealthy might reset lower.</b>&nbsp;It doesn&#39;t make the system sustainable or less evil; indeed,&nbsp;<i>it is the manifestation of the evil at the heart of the entire system</i>. It&#39;s not about shiny capitalism for the masses, or earning a profit by producing more and better goods and services: it&#39;s about doing whatever it takes to maximize private gain.</span></div> <div>&nbsp;</div> <div><span><b>The success of this vast defense of those maximizing their private gain at the expense of everyone else appears invulnerable to many.</b>&nbsp;In a system where central banks can print infinite money to further expand the value of the Financial Aristocracy&#39;s assets, it certainly seems that there is no force in the Universe that could possibly reduce this mighty Empire that worships only one god, that of&nbsp;<i>maximizing private gain by any means</i>.</span></div> <div>&nbsp;</div> <div><span><b>Let&#39;s say this system is sustainable:</b>&nbsp;the system that enriches the few at the expense of the many, the system that strip-mines the planet to enable private jets and trillions of dollars of wealth to rest comfortably in tax havens, a system that pays Nobel-prize-winning shills to spew nonsensical defense of the patently indefensible:&nbsp;<b>if this is sustainable, we must ask: at what cost?</b></span></div> <div>&nbsp;</div> <div><span><b>Is feeding this machine cost-free?</b>&nbsp;Are there no consequences? Can the Federal Reserve not just create money to further enrich the few, but eliminate all cost and consequence as well?</span></div> <div>&nbsp;</div> <div><span>To everyone resigned to the permanence and invulnerability of this evil, and everyone angered by the idea that it might implode and deprive them of their share of the swag, I suggest we consider&nbsp;<b>a funny thing called Karma</b>, which is the simple idea that actions have consequences which cannot be shoved onto others forever.</span></div> <div>&nbsp;</div> <div><span>A similar idea is&nbsp;<i>reversal is the way of the Tao.</i>&nbsp;What appears mighty and invulnerable melts into air, as extremes naturally cycle to the opposite state.</span></div> <div>&nbsp;</div> <div><span><b>Our loss of the ability to distinguish between&nbsp;<i>earning a profit</i>&nbsp;and&nbsp;<i>maximizing private gain by any means</i>&nbsp;has triggered a cultural crisis, one that few are willing to recognize, much less discuss.</b>&nbsp;All those angered by the mere question of the viability of this predatory pillaging in the name of capitalism are incapable of even admitting this cultural crisis exists. Their response to the question is to accuse anyone who dares question the morality and sustainability of the current system of desiring a financial Apocalypse.</span></div> <div>&nbsp;</div> <div><span><b>The easily angered are again confusing two distinct concepts:&nbsp;<i>wanting an Apocalypse</i>&nbsp;is entirely different from&nbsp;<i>seeing an Apocalypse on the horizon</i>.</b>&nbsp;A financial Apocalypse wouldn&#39;t even touch the assets of the many, because their financial wealth is near-zero. If the $20 trillion (or whatever the number is, nobody really knows) sitting in tax havens melted into air, who would even notice except the pillagers and those paid to defend them?</span></div> <div>&nbsp;</div> <div><span><b>The cultural crisis angers people because it threatens to loosen their grasp on the few threads of security they believe are real.</b>&nbsp;Those thin threads are illusory, and a crisis will eventually be resolved in one fashion or another--not necessarily in an Apocalypse, but in a fast-spreading recognition of the wrongness and unfairly distributed costs of supporting a system that is intrinsically evil and unsustainable.</span></div> <div>&nbsp;</div> <div><span><img align="middle" border="0" src="http://www.oftwominds.com/photos2012/wealth-distribution-USA.png" /> </span></div> </div> <p>&nbsp;</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="269" height="302" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20150426_CHS.jpg?1430059854" /> </div> </div> </div> http://www.zerohedge.com/news/2015-04-26/our-financial-future-infinite-greed-meets-funny-thing-called-karma#comments Central Banks ETC Federal Reserve Swag Sun, 26 Apr 2015 15:45:56 +0000 Tyler Durden 505531 at http://www.zerohedge.com The Next Round of the Great Crisis is at Our Doorstep http://www.zerohedge.com/news/2015-04-26/next-round-great-crisis-our-doorstep <p>The next round of the financial crisis is at our doorstep.</p> <p>&nbsp;</p> <p>Central Bankers bet the financial system that their academic theories would work, despite the countless real-world examples showing that printing money does not generate growth.</p> <p>&nbsp;</p> <p>After all&hellip; we know that&hellip;</p> <p>&nbsp;</p> <p>1)&nbsp;&nbsp; Stocks are expensive by just about every conceivable metric.</p> <p>2)&nbsp;&nbsp; Global GDP growth is overstated dramatically with China at most growing 3.5% per year, the US in recession, and Europe in a full-scale DE-pression.</p> <p>3)&nbsp;&nbsp; QE is completely useless at generating growth with Japan in a triple dip recession after launching a QE program equal to 25% of its GDP and the US in recession despite having spent over $3 trillion.</p> <p>4)&nbsp;&nbsp; Central Bankers don&rsquo;t care in the slightest about how their policies affect the rest of us.</p> <p>5)&nbsp;&nbsp; Even investing legends who have made their billions off of stocks admit the market is a complete farce and that a Crash is coming.</p> <p>6)&nbsp;&nbsp; Billionaires moving their money out of stocks and into ANYTHING else at a record pace.</p> <p>&nbsp;</p> <p>And finally..</p> <p>&nbsp;</p> <p>7)&nbsp;&nbsp; None of initial problems which lead to the 2008 crisis (excessive leverage, rampant fraud, etc.) have been addressed.</p> <p>&nbsp;</p> <p>Let&rsquo;s face the facts. The very same problems that lead to 2008 remain in place today. The people who created this mess have gone unpunished. No one went to jail. No rule of law was upheld. Instead trillions of US taxpayer dollars were funneled to a bunch of crooks and liars.</p> <p>&nbsp;</p> <p>And the Fed and friends actually thought growth might come out of this?</p> <p>&nbsp;</p> <p>We&rsquo;ve written before that the Fed&rsquo;s policies were cancerous and would kill the system. This has proven to be the case&hellip;</p> <p>&nbsp;</p> <p>&middot;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The bond market is illiquid and extraordinarily dangerous thanks to the Fed screwing up the yield curve and soaking up Treasuries from QE.</p> <p>&nbsp;</p> <p>&middot;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The stock market has no bearing on reality, with accounting standards thrown out the window and investors fleeing in droves.</p> <p>&nbsp;</p> <p>&middot;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The economy is in shambles with almost all job growth post 2008 based on phony accounting or crappy part time jobs&hellip; again thanks to policies employed by the Fed.</p> <p>&nbsp;</p> <p>&middot;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The middle class has been destroyed thanks to Dollar devaluation and rising costs of living that have wiped out savings and made it impossible for the average American to get by.</p> <p>&nbsp;</p> <p>&middot;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Retirees and those close to retirement have lost valuable interest income courtesy of the Fed&rsquo;s zero interest rate policy.</p> <p>&nbsp;</p> <p>At the end of the day, the Fed with its misguided theories have demolished capitalism: the single most powerful form of wealth generation in the history of mankind. All the Fed has really accomplished is leverage the entire financial by an even greater amount&hellip; which has set the stage for a collapse that will make 2008 look like a picnic.</p> <p>&nbsp;</p> <p>If you&rsquo;ve yet to take action to prepare for the second round of the financial crisis, we offer a FREE investment report Financial Crisis &quot;Round Two&quot; Survival Guide that outlines easy, simple to follow strategies you can use to not only protect your portfolio from a market downturn, but actually produce profits.</p> <p>&nbsp;</p> <p>You can pick up a FREE copy at:</p> <p>&nbsp;</p> <p><a href="http://www.phoenixcapitalmarketing.com/roundtwo.html">http://www.phoenixcapitalmarketing.com/roundtwo.html</a></p> <p>&nbsp;</p> <p>Good Investing</p> <p>&nbsp;</p> <p>Phoenix Capital Research</p> <p>&nbsp;</p> http://www.zerohedge.com/news/2015-04-26/next-round-great-crisis-our-doorstep#comments Bond China ETC Japan None Reality Recession Yield Curve Sun, 26 Apr 2015 15:17:48 +0000 Phoenix Capital Research 505530 at http://www.zerohedge.com