http://www.zerohedge.com/fullrss2.xml/sites/default/files/images/user5/imageroot/2011/09/pt%202.png en Former Congressman Warns That Foreign Countries Could Bribe The Feds To "Regulate Drudge" http://www.zerohedge.com/news/2017-09-24/former-congressman-warns-foreign-countries-could-bribe-feds-regulate-drudge <p><a href="http://www.thedailysheeple.com/former-congressman-warns-that-foreign-countries-could-bribe-the-feds-to-regulate-drudge_092017"><em>Authored by Alex Thomas via The Daily Sheeple,</em></a></p> <p>A former Republican Congressman from Colorado has <strong>warned that a foreign country could bribe or &ldquo;incentivize&rdquo; the FCC to regulate and&nbsp;&ldquo;rein in&rdquo; popular conservative news outlets, including The Drudge Report.</strong></p> <p><strong><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/09/23/20170924_drudge.jpg"><img height="263" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/09/23/20170924_drudge.jpg" width="538" /></a></strong></p> <p>Former Rep.&nbsp;Tom Tancredo, in an <a href="http://thehill.com/opinion/campaign/351739-could-russia-or-mexico-bribe-the-feds-to-regulate-drudge" target="_blank">opinion piece for The Hill</a>,&nbsp;started out his shocking warning by&nbsp;<strong>downplaying the so-called Russian actors who may have spent a measly&nbsp;$100,000 with&nbsp;social media giant Facebook </strong>in exchange for ads that hurt Hillary Clinton.</p> <p>Tancredo not only correctly noted that <strong>such a small amount of money could not have actually altered the election</strong>, he also destroyed the notion that the American establishment is &ldquo;surprised&rdquo; by the idea of a foreign government trying to influence an election.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>Facebook CEO Mark Zuckerberg said this month that his company sold over $100,000 in social media advertising to a Russian government-controlled front group during the 2016 election cycle. While that amount is a relative pittance and critics are saying the ads were poorly produced &mdash; where is Bill Maher when you really need him? &mdash; the discovery has raised alarms.</p> <p>&nbsp;</p> <p><strong>It&rsquo;s ironic, of course, that America&rsquo;s media elites are suddenly alarmed, considering that the CIA and intelligence agencies abroad have engaged in similar activity for decades.</strong> But putting that aside, what if the bigger danger comes not from amateurish foreign advertisers, but from foreign governments seeking to influence the American regulatory agencies meant to act as the citizens&rsquo; watchdogs?</p> </blockquote> <p>The former congressman then gets to the crux of his warning, asking a very pointed question to the reader that unfortunately sounds all too plausible in this day and age.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em><strong>Could a foreign government &mdash; such as Russia, Ukraine, or Mexico, for example &mdash; bribe or &ldquo;incentivize&rdquo; a federal agency such as the Federal Election Commission to regulate (or &ldquo;rein in&rdquo;) conservative news websites?</strong></em></p> <p>&nbsp;</p> <p>The truth could be stranger than fiction if you examine the habits of the federal commissioners who run our regulatory agencies.</p> </blockquote> <p>Tancredo then reveals a fact that news outlets like <a href="http://www.thedailysheeple.com" target="_blank">The Daily Sheeple</a> have long reported &ndash; <strong>there are absolutely elements within the federal government who have expressed support for censoring The Drudge Report in the past while at the same time taking dozens of trips overseas, sometimes even bashing the American way of life while doing so.</strong></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><strong>For years, Democrats on the&nbsp;FEC have been vocal in their desire to regulate speech on websites such as&nbsp;<a href="http://www.washingtonexaminer.com/republicans-accuse-fec-dems-of-trying-to-regulate-facebook-pages/article/2604307" rel="noopener noreferrer" target="_blank">Facebook</a>&nbsp;and&nbsp;<a href="http://www.washingtonexaminer.com/failed-effort-to-regulate-twitter-leaves-dems-exasperated/article/2587517" rel="noopener noreferrer" target="_blank">Twitter</a>, to say nothing of&nbsp;<a href="http://www.washingtonexaminer.com/fec-chair-who-sought-to-regulate-drudge-slams-colleagues-as-dysfunctional/article/2578893">Drudge</a>&nbsp;and&nbsp;<a href="http://www.washingtonexaminer.com/federal-regulation-of-internet-coming-warn-fcc-fec-commissioners/article/2595304">Fox News</a>. Will they use the news of foreign government purchasing social media advertising as an excuse to enter that regulatory minefield more boldly?</strong></p> <p>&nbsp;</p> <p>But what&rsquo;s even more worrisome is that third-party groups, some connected to foreign governments, have spent tens of thousands of dollars helping regulators travel around the world. Who&rsquo;s to say that quid pro quo, spoken or unspoken, isn&rsquo;t part of the equation?</p> <p>&nbsp;</p> <p>It&rsquo;s far more likely than the idea that foreign governments might be using a website like Drudge to spread propaganda. Buying one regulator would be more cost-effective than spending millions trying to sway millions through advertising. After all, &ldquo;I can get it for you wholesale&rdquo; is still the American way.</p> </blockquote> <p><strong>Consider this. As the establishment media continues to push their 24/7 anti-Trump echo&nbsp;chamber, real dangers posed by other countries are going unchecked, with many in the media most likely on board with the idea that top conservative news outlets need to be censored.</strong></p> <p>At this point one can&rsquo;t help but wonder (and worry) that <strong>some form of political censorship of the internet is on the horizon</strong> which will&nbsp;most likely be attempted by connecting the amazing success of someone like Matt Drudge to supposed Russian propaganda operations &ndash; all in the name of censoring non leftist voices.</p> <p><em>&nbsp;</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="538" height="263" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170924_drudge.jpg?1506264391" /> </div> </div> </div> http://www.zerohedge.com/news/2017-09-24/former-congressman-warns-foreign-countries-could-bribe-feds-regulate-drudge#comments Advertising Alternative media Censorship Central Intelligence Agency Communication Conservatism in the United States Digital media Drudge Report Facebook Federal Communications Commission Federal Election Commission federal government Fox News Mass media Matt Drudge Mexico Politics Propaganda techniques Russian government Tom Tancredo Twitter Twitter Ukraine Sun, 24 Sep 2017 17:21:49 +0000 Tyler Durden 604067 at http://www.zerohedge.com Obamacare Repeal Officially Dead After Cruz Says No http://www.zerohedge.com/news/2017-09-24/obamacare-repeal-officially-dead-after-cruz-says-no <p>In a sudden change of heart that kills senate Republicans&rsquo; effort to pass a bill to repeal and replace Obamacare before a rule allowing Republicans to circumvent a Democratic filibuster expires at the end of the month, Texas Sen. Ted Cruz is now saying he won&rsquo;t support the Graham-Cassidy Obamacare repeal bill.</p> <p>Cruz, who revealed his position during a panel discussion at a Texas Tribune conference in Austin, suggested that the proposal also lacks the vote of Sen. Mike Lee, according to <a href="http://www.politico.com/story/2017/09/24/cruz-opposes-latest-obamacare-repeal-243067">Politico</a>. The Texas Republican said he and Lee offered amendments to the Graham-Cassidy proposal last week that would go further in bringing down Obamacare premiums but that the changes weren&rsquo;t included in the latest draft of the bill.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user245717/imageroot/2017/09/11/2017.09.24tedcruz.JPG"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user245717/imageroot/2017/09/11/2017.09.24tedcruz_0.JPG" style="width: 500px; height: 304px;" /></a></p> <p>The latest blow to the seven-year-long Obamacare repeal effort comes as President Donald Trump escalates feuds with Both North Korea and US professional sports leagues. Cruz&rsquo;s opposition means that, with both he and McCain saying know and at least two other moderates leaning toward a no, that even if Trump manages to flip Sen. Rand Paul, he wouldn&rsquo;t be able to muster the 50 votes needed for Vice President Mike Pence to break a tie.</p> <p>&ldquo;Right now, they don&rsquo;t have my vote and I don&#39;t think they have Mike Lee&rsquo;s vote either,&rdquo; Cruz said during a panel discussion at the Texas Tribune festival in Austin that also included Sen. John Cornyn.</p> <p>Both Cruz and Cornyn &ndash; a member of senate Republican leadership - had said they back the way the bill would convert Obamacare funding into a system of block grants to states. But while Cornyn said he would vote for the bill as it stands, Cruz said that he wants to see more changes, but declined to elaborate.</p> <p>Ironically, Texas and other states that didn&#39;t expand coverage under Obamacare would fare well under the Graham-Cassidy plan, according to <a href="http://www.politico.com/story/2017/09/24/cruz-opposes-latest-obamacare-repeal-243067">Politico</a>, which cited an independent analyses of the bill showing it would save the state some $35 billion between 2020 and 2026.</p> <p>Rand Paul reiterated his opposition to the bill during an appearance on &ldquo;Meet the Press&rdquo; Sunday morning, saying he would only support the bill if the block-grant provision that Cruz purportedly supports (or at least, once supported) is dropped.</p> <p>&quot;What it sets up is a perpetual food fight over the formula,&quot; he said. &quot;What happens when Democrats win? They&#39;re going to claw back that money from Republican states to give to Democrat states.&quot;</p> <p><iframe allowfullscreen="" frameborder="0" height="315" src="https://www.nbcnews.com/widget/video-embed/1053743171718" width="560"></iframe></p> <p>Trump had said during a rally on Friday that Paul might &ldquo;come around&rdquo; then tweeted Saturday that he might&rsquo;ve found a way to gain the Kentucky Republican&rsquo;s support. News of Cruz&rsquo;s opposition must&rsquo;ve pleased the dozens of protesters who gathered outside the University of Texas auditorium where Cruz was speaking to protest repealing the bill.<br />&nbsp;</p> <p>* * *</p> <p>Here&#39;s a roundup of where key senators stand on Graham-Cassidy. As it suggests, the bill now has a very low chance of passing.</p> <p>&nbsp;</p> <blockquote class="twitter-tweet" data-partner="tweetdeck"><p dir="ltr" lang="en">Where GOP stands on Graham-Cassidy</p> <p>Murkowski: ????<br />Portman: ????<br />Collins: ????<br />Capito: ????</p> <p>McCain: ?<br />Cruz: ?<br />Paul: ?</p> <p>3 GOPers saying ? stops bill.</p> <p>&mdash; Dan Diamond (@ddiamond) <a href="https://twitter.com/ddiamond/status/911991619053850624">September 24, 2017</a></p></blockquote> <script async src="//platform.twitter.com/widgets.js" charset="utf-8"></script><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="520" height="316" alt="" src="http://www.zerohedge.com/sites/default/files/images/user245717/imageroot/2017.09.24tedcruz.JPG?1506271755" /> </div> </div> </div> http://www.zerohedge.com/news/2017-09-24/obamacare-repeal-officially-dead-after-cruz-says-no#comments 115th United States Congress American Presbyterians Donald Trump Donald Trump Internal Revenue Code John Cornyn John Cornyn Meet The Press Mike Lee Military brats North Korea Obamacare Patient Protection and Affordable Care Act Patient Protection and Affordable Care Act replacement proposals Politics Politics Politics of the United States Rand Paul Republican Party Ted Cruz Tribune United States University of Texas Sun, 24 Sep 2017 16:52:44 +0000 Tyler Durden 604081 at http://www.zerohedge.com German Establishment Routed: AfD Second In Former East Germany; Result "Less Market Friendly Than Expected" http://www.zerohedge.com/news/2017-09-24/german-establishment-routed-election-result-less-market-friendly-expected <p>The first sellside comments on today's German elections - which as a reminder <a href="http://www.zerohedge.com/news/2017-09-24/merkel-wins-german-election-afd-enters-parliament-after-late-surge">was a disaster for the </a><strong><a href="http://www.zerohedge.com/news/2017-09-24/merkel-wins-german-election-afd-enters-parliament-after-late-surge">German establishment, </a>following the worst showing for the CDU/CSU since 1949 and the worst result for the SPD since 1945 with support for both parties tumbling since the 2013 elections</strong>...</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/germany%20vs%202013.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/germany%20vs%202013_0.jpg" width="500" height="196" /></a></p> <p>... have started to trickle, in and according to SEB, the result is ‘less market-friendly’ than expected.</p> <p>Quoted by Bloomberg, SEB cross-asset strategist Thomas Thygesen said that the result is a victory for Angela Merkel as expected, <strong>but her mandate going into negotiations about deeper euro integration does not look quite as strong</strong>. </p> <p><strong>"It looks like marginally less market-friendly than expected,” </strong>Thygesen said adding that <strong>“I’d say this is in line with our expectation that the euro would pause around $1.20 vs dollar and then maybe retrace a couple of percent over the autumn.”</strong></p> <p><strong>“The AFD above 10% suggests that even here the stakes are high: if the European project doesn’t fly this time in a way that voters like, Germany could look less politically stable in a few years</strong>.”</p> <p>A note from Pantheon's Claus Vistesen is similarly concerned about the election outcome and the viability of the upcoming coalition:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><strong>At a first glance, it seems that building a coalition government will be a little trickier than markets had expected. </strong>If the exit polls prove accurate, the major parties—CDU and SPD—have suffered a drastic setback compared to the elections in 2013. CDU is projected to come out top with 32.5, of the votes, but this is far-, from the 42% in 2013. Similarly, the social democratic SPD have been pegged back to 20%, compared to just under 309, in 2013. The voter-flight from the two main parties appears to have gone in two opposite directions. The populist—and nominally EU sceptic—AFD is set to become the third-biggest party in the Bundestag with 13.5% of the votes, significantly better than the polls were predicting heading into today's vote. But the liberal FDP also is expected to have had a good day, securing 10.5% of the votes. </p> <p>&nbsp;</p> <p>Assuming the exit polls are accurate, Angela Merkel—who almost surely will remain as chancellor—has two options, assuming that a government with AFD is out of the question. <strong>She can form a two-party grand coalition with SPD or she can go for a coalition with the greens—set to gain 9.4%—and FDP. </strong>Our bet is on the latter—we doubt the SPD will go into a grand coalition given its after all scathing defeat—but this will be a slender coalition. Mrs. Merkel is a battle-hardened builder of coalitions, but she will need to draw on all her experience to form one, which can actually get things done. </p> <p>&nbsp;</p> <p><strong>On balance then, we see the exit polls are slightly negative from the point of view of risk assets in the Eurozone and the euro exchange rate. </strong></p> <p>&nbsp;</p> <p><strong>The result also increases the risk of re-elections, but we would put the probability of this at under 15%.</strong></p> </blockquote> <p>* * * </p> <p>Finally, in yet another shock for Germany's establishment, according to Europe Elects, the nationalist AfD was the second strongest party in former East Germany, the more economically backward segment of Germany.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/east%20germany.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/east%20germany_0.jpg" width="500" height="283" /></a></p> <p>We now await other analyst observations which we expect will be equally dour on today's election result, and as a result the EURUSD is set to tumble once it opens for early trading.</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="690" height="388" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/merkel%20teaser_4.jpg?1506271320" /> </div> </div> </div> http://www.zerohedge.com/news/2017-09-24/german-establishment-routed-election-result-less-market-friendly-expected#comments Alliance 90/The Greens Angela Merkel Christian Democratic Union of Germany Coalition government European Parliament European Union Eurozone Free Democratic Party German federal election Germany Grand coalition Politics Social Democratic Party of Germany Sun, 24 Sep 2017 16:42:10 +0000 Tyler Durden 604080 at http://www.zerohedge.com In Major Disappointment, Merkel Wins German Election Despite Worst Result Since 1949; AfD Surges To Enter Parliament http://www.zerohedge.com/news/2017-09-24/merkel-wins-german-election-afd-enters-parliament-after-late-surge <p>The German polls have officially closed, and the first exit polls numbers come in, confirming the expected fourth victory for Angela Merkel's CDU/CSU, however getting a unexpectedly low 32.5% of the vote, which according to Europe Elects <strong>was the worst result for Merkel's CDU/CSU (EPP) since 1949. </strong>Merkel's main challenger, the SPD, got 20%, <strong>also its worst result since Nazi era 1945; </strong>furthermore, the SPD has said it plans to enter the opposition, collapsing the current CDU/CSU-SPD "grand coalition."&nbsp; </p> <p>In other words, just like in the recent Franch elections, <strong>the German establishment was just trounced:</strong></p> <ul> <li><strong>Worst result for Merkel's CDU/CSU since 1949</strong><strong> <br /></strong></li> <li><strong>Worst result for SPD Since 1945</strong></li> </ul> <p>Meanwhile, there was an unexpected surge for the newcomers: the dramatic (late) surge for the nationalist AfD party, which got a higher than expected 13.5% of the vote, has made it not only the third most popular German party but also the first far-right German party to enter the Bundestag in 60 years. </p> <p>The first exit poll breakdown from ARD is as follows. </p> <ul> <li><strong>CDU/CSU - 32.5% </strong></li> <li><strong>SPD - 20% </strong></li> <li><strong>AfD - 13.5% </strong></li> <li><strong>FDP - 10.5% </strong></li> <li><strong>Greens - 9.5% </strong></li> <li><strong>Left party - 9%</strong></li> </ul> <p><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/german%20polls_0.jpg" width="500" height="500" /></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/potential%20german%20coalition.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/potential%20german%20coalition_0.jpg" width="500" height="231" /></a></p> <p>An exit poll from ZDF has a similar breakdown:</p> <ul> <li>CDU/CSU-EPP: 33.5%</li> <li>SPD-S&amp;D: 21%</li> <li>AfD-ENF: 13%</li> <li>FDP-ALDE: 10%</li> <li>LINKE-LEFT: 9%</li> <li>GRÜNE-G/EFA: 9%</li> </ul> <p>Even more troubling for the German establishment <strong>is that the far-right AfD was the second strongest party in former Eastern Germany:</strong></p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">Germany, ARD exit poll: Far-right <a href="https://twitter.com/hashtag/AfD?src=hash">#AfD</a> (ENF) second strongest party in former Eastern Germany. <a href="https://twitter.com/hashtag/btw17?src=hash">#btw17</a> <a href="https://twitter.com/hashtag/Wahl17?src=hash">#Wahl17</a> <a href="https://t.co/wXwzFlZ2Zp">pic.twitter.com/wXwzFlZ2Zp</a></p> <p>— Europe Elects (@EuropeElects) <a href="https://twitter.com/EuropeElects/status/911994796746698752">September 24, 2017</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script><p>According to the Exit Poll, the likely coalition options include CDU/CSU-SPD or CDU/CSU-FDP-GREENS. The various possibilites are shown below.</p> <p><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/german%20colaition%20scenarios_0.jpg" width="500" height="372" /></p> <p>However, according to SPD's Schwesig, <strong>the leadership is united on entering opposition</strong>, <strong>meaning a grand coalition is unlikely and the CDU may have to settle for a government with the FDP and the Greens, a so-called "Jamaica Coalition."&nbsp; </strong></p> <p><strong><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/jamaica%20coalition%20new.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/jamaica%20coalition%20new_0.jpg" width="500" height="309" /></a><br /></strong></p> <p>* * * </p> <p>Contrary to earlier reports of muted participation, Europe Elects predicted today's turnout could be as high as 80 per cent, potentially the highest turnout of the past two decades. </p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">Germany, turnout:</p> <p>2005: 77.7%<br />2009: 70.8%<br />2013: 71.5%<br />2017: ~80% (prognosis)<a href="https://twitter.com/hashtag/btw17?src=hash">#btw17</a> <a href="https://twitter.com/hashtag/gehtwaehlen?src=hash">#gehtwaehlen</a></p> <p>— Europe Elects (@EuropeElects) <a href="https://twitter.com/EuropeElects/status/911960616038010881">September 24, 2017</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script><p>Furthermore, as Europe Elects adds, today could mark the highest turnout in a key German state since 1988.&nbsp; In Sachsen-Anhalt, as of&nbsp; 4pm, turnout today is around 56 per cent - quite a bit higher than in 2013, 2009, 2005 and 2002. Turnout is not quite as high as 1988 yet, when turnout was around 62 per cent at the same time.</p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">Germany (Sachsen-Anhalt), turnout at different times of the day. Highest turnout since 1998 so far. <a href="https://twitter.com/hashtag/btw17?src=hash">#btw17</a> <a href="https://twitter.com/hashtag/gehtwaehlen?src=hash">#gehtwaehlen</a> <a href="https://t.co/1CxVkjLQRS">pic.twitter.com/1CxVkjLQRS</a></p> <p>— Europe Elects (@EuropeElects) <a href="https://twitter.com/EuropeElects/status/911961333800808448">September 24, 2017</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script><p>Turnout is particularly significant in this election, as fewer CDU and SDP voters heading out to their booths means a larger vote share for the AfD. </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="1080" height="588" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/bundestag%20teaser.jpg?1506269068" /> </div> </div> </div> http://www.zerohedge.com/news/2017-09-24/merkel-wins-german-election-afd-enters-parliament-after-late-surge#comments AfD party Alliance 90/The Greens Angela Merkel Christian Democratic Union of Germany Eastern Germany Environment European Green Party European Parliament European Union Free Democratic Party German federal election German party Germany Grand coalition Helmut Kohl Jamaica Coalition Left Party Politics Politics of Europe Politics of Germany Twitter Twitter Sun, 24 Sep 2017 16:06:36 +0000 Tyler Durden 604078 at http://www.zerohedge.com Iran Closes Airspace To Iraqi Kurdistan Ahead Of Historic Independence Vote http://www.zerohedge.com/news/2017-09-24/iran-closes-airspace-iraqi-kurdistan-ahead-historic-independence-vote <p>The diplomatic and economic noose is tightening around Iraqi Kurdistan one day ahead of its historic independence referendum. On Sunday, the Iranian government announced<strong> closure of its airspace to northern Iraq&#39;s Sulaimani and Erbil Airports, at the request of Iraqi authorities. </strong>The Baghdad government has repeatedly threatened military intervention in Iraq&#39;s autonomous Kurdish region should the vote proceed on Monday, which Baghdad warns could provoke invasion by neighboring states. The United States too has warned that the non-binding referendum will be <strong>&ldquo;particularly provocative and destabilizing&rdquo;</strong> - this as Turkey musters tanks along its border with Iraqi Kurdistan.&nbsp;</p> <p>On Sunday the Iranian Supreme Security Council announced through state media that, &ldquo;At the request of the Iraqi central government, Iranian airspace has been closed on all flights that originate from Kurdistan Region.&rdquo; The move comes after a month&#39;s worth of warnings that Iran could close its borders to Iraqi Kurdistan should the independence vote proceed. Iranian government officials had previously warned that, &ldquo;The republic of Iran has opened its legitimate border gates on the premise of the consent of the federal government of the Iraqi state. If such an event [referendum] happens, these border gates from the perspective of the Islamic Republic of Iran would lose its legitimacy.&quot;</p> <p><em><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/kurd%20vote1.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/kurd%20vote1_0.jpg" style="width: 500px; height: 281px;" /></a><br />Kurdistan referendum ballot book held by an employee from the Independent High Electoral Referendum Commission. Image source: AFP</em></p> <p>Iran worries that an independent Kurdistan at its border would be a destabilizing force concerning Iran&#39;s own sizable Kurdish minority. Iran also reportedly <strong>launched Revolutionary Guard led military drills in its northwest region bordering Iraqi Kurdistan on Sunday.</strong></p> <p>Likewise Turkey has for the past week amassed tanks and troops along its border with Iraq, while reportedly conducting &quot;anti-terror operations&quot; in Kurdish areas of the country. In a geographic sense Turkey would play a key economic lifeline for the completely landlocked Iraqi Kurdistan region.&nbsp;But Turkey&#39;s Parliament voted Saturday to renew for one year a mandate <strong>authorizing military intervention across Iraq&#39;s border should Turkey&#39;s national security come under threat.</strong></p> <p>Over the weekend the Kurdish regional capital of Erbil saw tens of thousands of Kurds flood the streets demonstrating in support of an independent Kurdistan. However, protests against the planned referendum broke out in other areas of Iraq. Violence also began to hit the region as<strong> an <a href="http://www.aljazeera.com/news/2017/09/tensions-rise-iraq-kurdish-referendum-170924094444442.html" target="_blank">IED killed four Iraqi Kurdish soldiers</a> and injured over a dozen more in the province of Kirkuk, an area where the referendum is set to be held.&nbsp;</strong></p> <p>Arab parts of the country have voiced frustration that such a divisive move would come at a key moment in the fight against ISIS. The fact that Israel is the only outside country voicing official support for Kurdish independence is also deeply controversial.&nbsp;</p> <p><em><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/kurd%20vote2.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/kurd%20vote2_0.jpg" style="width: 500px; height: 500px;" /></a><br />Map source: International Iran Times</em></p> <p>On Sept. 13 Israeli Prime Minister Benjamin Netanyahu stunned the region when he&nbsp;<a href="https://www.reuters.com/article/us-mideast-crisis-kurds-israel/israel-endorses-independent-kurdish-state-idUSKCN1BO0QZ" target="_blank">commented specifically of the referendum</a>&nbsp;saying,&nbsp;&quot;Israel supports the legitimate efforts of the Kurdish people to achieve their own state&quot;&nbsp;(though he&#39;s made similar statements starting in 2014). Netanyahu noted further that Israel still considers the Turkey-based Kurdistan Workers Party (PKK) a terrorist group.</p> <p>Other current and former Israeli officials have made bolder and more detailed statements, however.&nbsp;The former Deputy Chief of the General Staff of the Israeli Defense Forces (IDF), Major General Yair Golan <a href="https://www.dailysabah.com/war-on-terror/2017/09/13/israeli-major-general-says-pkk-not-a-terror-group-declares-support-for-krg-independence" target="_blank">told a national security policy conference</a> in Washington D.C. in early September that he believes&nbsp;establishing a Greater Kurdistan (a state that will include the Kurdish-populated territories of Syria, Iraq, Iran and Turkey) in the Middle East could be a positive stabilizing force in the region.&nbsp;He also said that he personally does not be believe the PKK to be a terrorist organization.&nbsp;</p> <p>Israel&#39;s public stance provoked a quiet diplomatic war with Turkey, which Israel accuses of supporting Hamas. Turkey has for years accused Israel of forging a secretive vengeful alliance with the PKK due to Turkey&#39;s pro-Palestine statehood position. But Israel has consistently pointed to what it&nbsp;<a href="http://www.haaretz.com/middle-east-news/1.812469" target="_blank">perceives as Turkish hypocrisy</a>&nbsp;in failing to designated Hamas a terror organization. Furthermore, Iranian state media has frequently equated an independent Kurdistan with Israeli plans to Balkanize the region as part of a &quot;divide and rule&quot; policy in the region.&nbsp;</p> <p>But despite signs of looming destabilization ahead of Monday&#39;s vote, <strong>it appears Kurdish authorities in Erbil are determined to see the referendum through, no matter the consequences.</strong></p> <p>Quoted by Bloomberg, Kurdistan Regional Government President Massoud Barzani said in televised news conference that Iraq&rsquo;s Kurds &quot;reached conclusion that only through independence can we secure our future&quot; and said he is ready to engage in &quot;very long&quot; talks with Iraq govt on borders, oil, gas, water after the vote. He also added that the Iraq, Kurdistan partnership failed after Baghdad violated the constitution.</p> <p>Like in Germany, Barzani urged voters to head to polls and maintain a &quot;peaceful process&quot; while saying that Peshmerga forces will continue cooperation with Iraqi troops and the U.S.-led coalition in the &quot;fight against terror.&quot;</p> <p>Barzani also said that referendum is not a threat to Turkey&rsquo;s national security, and added that he &quot;doesn&rsquo;t expect military confrontation with Iraq after referendum<strong>&quot;, a rather clear hint that military confrontation with Iraq after the expected vote to break away may be inevitable</strong>. To be sure, Iraq Prime Minister Haider Al-Abadi said in televised speech that Kurdistan&rsquo;s problems are &quot;a result of corruption, mismanagement of public money&quot; <strong>adding that a referendum would only exacerbate such issues.</strong></p> <p>Finally, addressing Iran&#39;s closure of airspace, he said that it was Tehran&rsquo;s decision.</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="1000" height="561" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/kurd%20vote1.jpg?1506267607" /> </div> </div> </div> http://www.zerohedge.com/news/2017-09-24/iran-closes-airspace-iraqi-kurdistan-ahead-historic-independence-vote#comments Baghdad government Corruption federal government Geography of Asia Geography of Iraq Geography of Kurdistan Germany Hamas High Electoral Referendum Commission IDF Iran Iranian government Iraq Iraqi Airways Iraqi Kurdistan Iraqi Kurdistan independence referendum Israel Kurdistan Kurdistan independence movement Kurdistan Regional Government Kurdistan Regional Government Middle East Middle East national security northern Iraq Politics Politics of Iraq Security Council Sulaymaniyah Turkey Turkey's Parliament War Washington D.C. Workers Party Sun, 24 Sep 2017 15:42:30 +0000 Tyler Durden 604075 at http://www.zerohedge.com The Markets Call "BS" on the Fed's Hawkishness http://www.zerohedge.com/news/2017-09-24/markets-call-bs-feds-hawkishness <p>The Fed wants us to believe that it remains hawkish, that it will begin the process of unwinding its $4.5 trillion balance sheet next month and that it will hike rates again this year.</p> <p>The markets aren&rsquo;t buying it, even for a second.</p> <p>The top performing asset class after the Fed concluded its announcement on Wednesday was&hellip; TREASURIES: the asset class that should DROP hard if the Fed intends to raise rates.</p> <p>Apparently bonds didn&rsquo;t believe that Fed Chair Janet Yellen was going to hike rates again for more than a few hours. As a result of this, the long-Treasuries ETF (TLT) actually OUTPERFORMED the S&amp;P 500 as well as the NASDAQ post the FOMC.</p> <p><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user20289/imageroot/2017/09/13/sc-9.png" style="width: 460px; height: 284px;" /></p> <p><strong><u>Again, LONG-Treasuries beat Tech stocks after the Fed FOMC.</u></strong> The market doesn&rsquo;t believe the Fed will be hiking rates again this year. Heck, the market doesn&rsquo;t even believe that the Fed has a clue anymore.</p> <p>As for the Fed&rsquo;s proposal to unwind its balance sheet&hellip; does anyone remotely believe this will happen to any significant degree?</p> <p>We know from Fed transcripts that Janet Yellen was worried about a balance sheet unwind as far back as 2009 when the Fed balance sheet was just $1.0 trillion. Somehow that same woman is now fully confident the Fed will be able to do this now that the balance sheet is the size of a G-7 country&rsquo;s economy at $4.5 trillion?</p> <p>Give us a break.</p> <p>The reality is that the second the stock market begins to take a nosedive, the Fed will begin walking backs any talk of balance sheet normalization. Indeed, the only reason the Fed is even floating this idea is because stocks are at nosebleed levels. And with the Fed having failed miserably to generate economic growth, job creation or anything else, stock levels remain the one area of success to which the Fed can point.</p> <p>Are they really going to jeopardize that, especially since Fed Chair Janet Yellen openly admitted the Fed considers &ldquo;asset price levels&rdquo; for its rate hikes (asset prices in Fed speak means stock levels)?</p> <p>Nope.</p> <p>The second stocks drop, the Fed will end its hawkishness. Indeed, judging by the looks of the $USD, the markets already know that the Fed will probably be talking about easing within 12 months time.</p> <p><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user20289/imageroot/2017/09/13/sc-10.png" style="width: 460px; height: 284px;" /></p> <p>Put simply, the markets have called &ldquo;BS&rdquo; on the Fed this week. The one clear takeaway is that the Fed is no longer in control and that the markets smell &ldquo;money printing&rdquo; in the future.</p> <p>This is going to be like rocket fuel for Gold and other inflation trades. Already the precious metal has broken out of a seven-year downtrend. And once the Fed stops walking back all talk of balance sheet reduction in the coming weeks, Gold is going to go THROUGH. THE. ROOF.</p> <p><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user20289/imageroot/2017/09/13/sc-11.png" style="width: 460px; height: 284px;" /></p> <p>If you&rsquo;re not taking steps to actively profit from this, it&rsquo;s time to get a move on.</p> <p>We just published a Special Investment Report concerning a secret back-door play on Gold that gives you access to 25 million ounces of Gold that the market is currently valuing at just $273 per ounce.</p> <p>The report is titled <strong>The Gold Mountain: How to Buy Gold at $273 Per Ounce</strong></p> <p>Today is the final day this report will be available to the public.</p> <p>To pick up yours, swing by:</p> <p><a href="https://www.phoenixcapitalmarketing.com/goldmountain.html"><strong>https://www.phoenixcapitalmarketing.com/goldmountain.html</strong></a></p> <p>Best Regards</p> <p>Graham Summers</p> <p>Chief Market Strategist</p> <p>Phoenix Capital Research</p> <p>&nbsp;</p> <p>&nbsp;</p> http://www.zerohedge.com/news/2017-09-24/markets-call-bs-feds-hawkishness#comments Business Economy Fed Speak Federal Open Market Committee Federal Reserve System Finance Financial services G-7 Janet Yellen Janet Yellen NASDAQ Reality S&P 500 US Federal Reserve Sun, 24 Sep 2017 15:36:57 +0000 Phoenix Capital Research 604073 at http://www.zerohedge.com With German Polls Closing, Merkel Looks To Historic 4th Term In Office; Far-Right AfD Set To Enter Bundestag http://www.zerohedge.com/news/2017-09-24/german-polls-closing-merkel-looks-historic-4th-term-office-far-right-party-set-enter <p>With polls closing shortly, Germany voted on Sunday in the country's federal elections, with long-serving Chancellor Angela Merkel looks certain to win a historic fourth term in office (<a href="http://www.zerohedge.com/news/2017-09-22/why-german-elections-matter-and-not-just-germany">see full preview here</a>). Absent last minute drama, the poll is also expected to see the right-wing Alternative for Germany (AfD) entering parliament for the first time. <strong>The only outstanding question today is which other party or parties will join the chancellor’s Christian Democrats coalition in her new government</strong></p> <p>Polls opened at 8am (06:00 GMT) and first projections are expected when the polls close at 6pm.</p> <p>German President Frank-Walter Steinmeier urged people to go vote. "Voting is a civic duty. Go and vote!" Steinmeier wrote in an opinion piece published in the Bild am Sonntag Sunday newspaper. "Every vote counts - your vote counts," Steinmeier doubled down, hoping to avoid the recent plunge in voter participation observed in France. "People who don't vote allow others to decide the future of our country." </p> <p>Some 61.5 million people are eligible to vote, and turnout was expected to be higher than the 71.5% of voters who turned up at the polls at the last election four years ago, however amid overcast skies and rain in much of Germany, turnout was little changed from the previous election in 2013, reaching 41.1% at 2 p.m. Berlin time, four hours before the close of voting.</p> <p>Regardless of participation, the winner is certain: opinion polls suggest Merkel and her party are heading for a clear win, which would gift Merkel a historic fourth term. Merkel’s bloc, which includes her Bavarian allies in the Christian Social Union, had the support of just about 37 percent of voters in the final opinion polls during the campaign. </p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/merkel%20votes.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/merkel%20votes_0.jpg" width="500" height="281" /></a></p> <p>That’s about 15 percentage points ahead of its main challenger and current coalition partner, Martin Schulz’s Social Democrats. <a href="https://www.bloomberg.com/news/articles/2017-09-23/merkel-seeks-fourth-victory-as-germans-vote-in-federal-election">According to Bloomberg</a>, four other parties -- the pro-business Free Democrats, the Greens, the anti-capitalist Left and, for the first time ever, the populist Alternative for Germany, or AfD, are poised to win seats in the lower house of parliament, the Bundestag</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/german-federal-election-090817%20%281%29.png"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/german-federal-election-090817%20%281%29_0.png" width="500" height="568" /></a></p> <p>A fourth victory for the Chancellor would crown a remarkable comeback for Merkel from a plunge in her popularity amid the 2015-16 refugee crisis that saw 1.3 million migrants flood into Germany. Early this year, she was equal in the polls with Schulz, a fresh face in German domestic politics, but the Social Democrat’s challenge has faded in recent months and his party threatens to post its worst result since World War II. Merkel, 63 and chancellor for 12 years, has portrayed herself during the campaign as a beacon of stability in a world buffeted by crises.</p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">Angela Merkel casts her vote in Germany's general election <a href="https://twitter.com/hashtag/GermanyDecides?src=hash">#GermanyDecides</a> <a href="https://t.co/ei5VQyXxk9">pic.twitter.com/ei5VQyXxk9</a></p> <p>— AFP news agency (@AFP) <a href="https://twitter.com/AFP/status/911962182631354368">September 24, 2017</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script><p>"There is no other European politician who could remotely match her in terms of her longevity, her credibility among her own people," said Al Jazeera's Laurence Lee, <a href="http://www.aljazeera.com/news/2017/09/germany-votes-key-national-elections-170924044427164.html">reporting from Berlin</a>. "It is impossible to imagine a conservative politician or even one from the left in any other European country taking in a million refugees and surviving politically."</p> <p>“Despite everyone saying this election is boring, it’s actually crucial from a geo-strategic point of view,” Judy Dempsie, a senior associate at Carnegie Europe, said in a Bloomberg Television interview. The result will determine what kind of a partner the U.S. has in Europe on issues such as North Korea, she said. “Whoever wins the election on Sunday will have to become far more involved in these major geo-strategic issues that are outside Europe.” </p> <p>In terms of preferred outcomes, Merkel's Christian Democrats (CDU) can hope for a narrow majority with the pro-business Free Democrats (FDP), or the environmentalist Greens, or an untried coalition with both. </p> <p>Alternatively, the CDU will continue its so-called grand coalition of the biggest parties with the centre-left Social Democratic Party (SPD), which has seen its support erode to a historic low over the past decade. Martin Schulz, the SPD candidate and Merkel's main contender, is stuck in polls of about 20 percent support, and has been unable to make any headway against the CDU.</p> <p><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/german%20colaition%20scenarios_0.jpg" width="500" height="372" /></p> <p>The biggest surprise, however, the nationalist Alternative for Germany (AfD) is expected to take at least 60 parliamentary seats in the election, after having narrowly failed to clear the 5% hurdle to enter parliament in 2013. <strong>It would be the first time in 60 years that a far-right party is represented in the Bundestag. </strong>AfD has been saying it will press for Merkel to be "severely punished" for opening the door to refugees and migrants, and attacked Islam by saying it "does not belong in Germany". </p> <p>The outcome of today's election is also being closely watched in Paris, where President Emmanuel Macron is proposing measures to deepen integration in the euro area that depend on the support of Germany, Europe’s biggest economy as well as its dominant country under Merkel.</p> <p>Once voting ends at 6pm local time, television exit polls will reveal if the chancellor has managed to outperform expectations as she did in the previous election in 2013. If the CDU/CSU and the FDP can get to a combined 48.5 percent or so - a level they’ve not managed in polling since late August - that would allow Merkel to reprise the business-friendly coalition she led from 2009 to 2013, <a href="https://www.bloomberg.com/news/articles/2017-09-23/merkel-seeks-fourth-victory-as-germans-vote-in-federal-election">according to Bloomberg</a>. </p> <p>If not, she has two alternatives: as noted above, the first is to try to add the environmentalist Greens to that coalition with the FDP, but it’s a combination previously untested at national level. The easier option might be to continue the “grand coalition” with the SPD, though that would face resistance among grassroots Social Democrats who would prefer to go into opposition. While agreement on a CDU-FDP coalition might take just a few weeks, other options could see talks dragging on for months.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/800x-1%20%282%29.png"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/800x-1%20%282%29_0.png" width="500" height="250" /></a></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/project%20alliances.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/project%20alliances_0.jpg" width="500" height="520" /></a></p> <p>Whatever the final distribution of seats, a fourth election victory for Merkel, western Europe’s most powerful political leader, would equal those for her CDU predecessors Konrad Adenauer, the first postwar chancellor, and Helmut Kohl, who oversaw German reunification in 1990. She’s said she plans to serve a full four-year term, which would equal Kohl’s record 16 years in office</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="800" height="450" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/merkel%20votes.jpg?1506265959" /> </div> </div> </div> http://www.zerohedge.com/news/2017-09-24/german-polls-closing-merkel-looks-historic-4th-term-office-far-right-party-set-enter#comments AFP Alliance 90/The Greens Angela Merkel Chancellors of Germany Christian Democratic Union of Germany Christian Democrats Christian Democrats (CDU) Christian Social Union European Parliament France Frank-Walter Steinmeier Free Democratic Party German federal election Germany Germany Grand coalition Helmut Kohl Newspaper North Korea Politics Politics of Germany Social Democratic party Social Democrats Twitter Twitter western Europe Sun, 24 Sep 2017 15:21:11 +0000 Tyler Durden 604071 at http://www.zerohedge.com Trump Tax Plan Leaked, Includes Tax Cuts For Wealthiest Americans; Morgan Stanley Skeptical http://www.zerohedge.com/news/2017-09-24/trump-tax-plan-leaked-includes-tax-cuts-wealthiest-americans-morgan-stanley-skeptica <p>Ahead of the Trump administration's official disclosure of what its latest tax proposal would look like, <a href="https://www.axios.com/exclusive-trump-gop-to-cut-top-rate-to-35-percent-2488858973.html">overnight Axios leaked some of the more salient highlights, the </a><strong>first being that the tax rate for the wealthiest Americans would be cut to 35% and second, taxes on on big and small businesses would be reduced substantially, with plans to cut the top tax rate for “pass through" businesses from 39.6% to 25% - </strong>a move which would impact LLCs and sole-proprietorships. As Axios explains, this change would have a material impact on most small businesses in America, which do not pay the corporate tax and instead have their profits “passed through” to owners and taxed at the individual income rate. <a href="https://www.axios.com/exclusive-trump-gop-to-cut-top-rate-to-35-percent-2488858973.html">Bloomberg also adds </a>that at the same time Republican negotiators are targeting a corporate tax rate of 20 percent, according to two people familiar with the matter. That would be higher than the 15% President Donald Trump wants, setting up a key decision for the president on a top legislative priority.</p> <p>The plan was conceived by the "Big Six" Republicans, a group which includes House Speaker Paul Ryan, Senate Majority Leader Mitch McConnell, Treasury secretary Steven Mnuchin, White House economic adviser Gary Cohn, and the chairmen of the two tax-writing committees — Senate Finance Committee chairman Orrin Hatch and House Ways and Means chairman Kevin Brady. </p> <p>Some further details, per Axios' sources:</p> <ul> <li>Top individual tax rate cut from 39.6 to 35. The current seven income tax brackets collapsed to three, as part of simplification. (Axios hasn't obtained the other two rates.)</li> <li>Axios can confirm that the Big Six agreed to cut the corporate tax rate from 35 percent to 20 percent. That key detail leaked last night to the Washington Post. (Trump has said he wants the corporate rate to be 15 percent.)</li> <li>The Big Six framework is also expected to include guardrails to prevent wealthy people from artificially lowering their income taxes by rearranging their affairs to get taxed at the small business rate.</li> <li>We can confirm, too, WashPo's reporting that under the Big Six framework there'll only be three individual income tax brackets rather than the current seven, and that Republicans plan to double the standard deduction — a boost for the middle class and a key component of simplification.</li> </ul> <p>As Axios adds, this "Big Six" tax framework "named because it's been hashed out behind closed doors between six top Republicans and administration officials" will set up a clash with Democrats over the tax breaks that apply to large corporations and upper income Americans, as Democrats have already drawn a red line on tax reform and 45 out of 48 Democratic senators signed a letter saying they wouldn't support any tax bill that adds to the deficit or offers new tax breaks to the wealthiest Americans.</p> <p>At the same time, "republicans are desperate for a win and appear on course to fund tax cuts with a blend of deficit spending and the closing of loopholes. They will dare Democrats, especially the 10 senators up for re-election in states Trump won, to vote against tax breaks for their constituents."</p> <p>Trump and Treasury Secretary Steven Mnuchin have said previously that they didn’t want the tax plan to offer any tax cut to the highest earners and that they’d balance a rate cut by eliminating deductions that the wealthy use to reduce their tax bills. Mnuchin said in November, weeks after Trump’s election, that “there will be no absolute tax cut for the upper class.”</p> <p>Reminded of that on Sunday, Mnuchin said he never made a "pledge" that there would be no absolute tax cut for the upper class in the administration's tax plan. During an interview on CNN's "State of the Union," Mnuchin was asked about previous comments, in which he said there would be no absolute tax cut for the upper class.</p> <p>"Can you reaffirm that pledge that there will be 'no absolute tax cut for the upper class?" CNN's Jake Tapper asked Mnuchin. </p> <p>"It was never a promise. It was never a pledge...It was what the president's objective was," Mnuchin said. Mnuchin said the administration has been working with the bipartisan leadership.</p> <p>"We look forward to releasing the plan this week," Mnuchin said. "I think what's important about this plan is it creates a middle-income tax cut. It makes businesses competitive and it creates jobs. That's what this is all about." Mnuchin also said there are "lots of changes" as it relates to the "high end."</p> <p>"We're getting rid of lots of deductions," he said. "And yes, I can tell you, the current plan for many, many people, it will not reduce taxes on the high end." He also said the plan will provide a middle-income tax cut and said it will create jobs. Mnuchin also said that there was a meeting on tax reform on Tuesday at the White House with congressional Republicans and Democrats, </p> <p>* * * </p> <p>Despite the growing movement on Trump's tax reform, in a note released earlier this week, Morgan Stanley's Michael Zezas said that <strong>he is skeptical of bipartisanship and Q4 is a logjam, "but tax reform should make slow progress toward 2018 passage even as failure risks remain. Deficit expansion is part of the deal, but limited in scope &amp; stimulus</strong>." </p> <p>Below are Zezas' observations on what happens next:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>We expect the tax reform process to temporarily take a backseat to some legislative 'must do's' in 4Q. The latest continuing resolution and debt ceiling suspension expire on December 8. A fix to the former is complicated by the need to raise expiring budget caps. On the latter, while cash-management measures should extend the 'drop dead date' on the debt ceiling until April (or, with a little luck, June), we believe Republicans will address this 'early', in 4Q, and include the debt ceiling increase in the end-of-year deal to avoid voting on it next year closer to the midterms while they are finalizing tax reform. December is further complicated by the Democrats' declaration that they will include a DACA fix to all 'must-pass' legislation. We expect a face-saving resolution to emerge (potentially after a series of one-week extensions), but similar events have been volatility-inducing, historically. </p> <p>&nbsp;</p> <p><strong>Tax reform should survive, but advance more slowly than the current proposed timeline (1H18 passage est.). With data from historical tax cuts as our guide, we continue to expect a modest deficit expansion that delivers little near-term stimulus: </strong>We expect the tax reform effort to survive the pitched policy battles about immigration and near-term government funding. Republicans' conceptual policy agreement on the issue, and desire to avoid squandering one-party control, likely supersede any lingering divisions and help the party continue its progress. However, some management of expectations regarding the timing and content of tax reform is in order, and outcome risks are skewed toward our bear case.</p> <p>&nbsp;</p> <ul> <li><strong>Base case</strong> – a complex simplification: In our view, reconciliation limits the ambition of tax plans, and waters down even the less aggressive proposal we expect next week. Corporate reforms are phased in, with a terminal rate of 25% paid for by repatriation, haircuts to interest deduction, and dynamic scoring. Personal tax code changes include permanent 'simplification' and temporary, but modest, rate cuts paid for through dynamic effects and an income-based limitation of itemized deductions. First-year deficits would be projected to rise by a modest 0.5% of GDP, similar to the year 1 scores of the Bush tax cuts, given that currently proposed rate cuts score as similar deficit expansions.</li> <li><strong>Bull case </strong>– all dessert, no vegetables: Holdout fiscal hawks abandon caution and fully embrace supply-side faith that tax cuts pay for themselves as special interest groups push back on initially proposed limitations to deductions. Corporate tax changes remain similar to the base case, but deficit-funded, temporary personal cuts are accommodated by either extending the budget window or replacing the JCT as the official legislative scorer. First-year deficits would be projected to expand by about 1% of GDP, the high end of the impact from recent, similarly sized, unfunded tax cuts.</li> <li><strong>Bear case </strong>– party foul: No legislative action before the midterm elections as Republicans fail to clear any of a number of hurdles: key policy disagreements; delayed response to existing legislative needs&nbsp; like DACA or the debt ceiling; and an unforeseen crisis requiring Congressional attention.</li> </ul> </blockquote> <p>Morgan Stanley concludes with the following five takeaways for Investors: </p> <ol> <li>Stimulus may disappoint, but progress is enough for risk markets near term; </li> <li>US dollar flow from repatriation may disappoint; </li> <li>Relative fundamental equity sector winners include retail, telecom, energy, &amp; utilities; </li> <li>Tbills issuance may grow by $200B in 1Q18; </li> <li>Be prepared for Q4 volatility, opportunity.</li> </ol> <p>In any case, President Trump plans to give a speech unveiling the Big Six framework in Indiana on Wednesday. The framework is the starting point for the tax reform process. It reflects the shared view of the Big Six, but it will inevitably change substantially as it goes through the normal legislative processes in the House and Senate.</p> <p>Finally, going back to Axios, here are five things which it believes can trip the process.</p> <ul> <li>The National Federation of Independent Business (NFIB,) the leading small business association, wants to equalize the small business rate and the corporate rate. Under the current plan, that's not happening. The corporate rate will be 20 percent and the small business rate 25 percent. "That's going to be controversial, but it's not a deal-breaker I don't think," said a source close to the process.</li> <li>House conservatives — especially the Freedom Caucus — haven't been involved in the Big Six discussions and they want the corporate rate to be much lower, at 16 percent. Republican leaders say there's no way that's going to happen, and Treasury Secretary Mnuchin agrees.<br />The Trump tax plan will likely add to deficits, at least in the short term, which will bother some deficit hawks. But tax reform advocates were heartened when, just this week, Senate Republicans on the </li> <li>Budget Committee cut a deal that would reduce government revenue by as much as $1.5 trillion over 10 years. Republicans argue that, with economic growth spurred by the tax reform, there'll be substantially less lost revenue than $1.5 trillion.</li> <li>Realtors and home builders won't be happy with the doubling of the standard deduction. That's because lots more people will take the standard deduction and many fewer will itemize their tax returns. A prevailing belief in the real estate world is that under those conditions, fewer people will take the mortgage interest deduction, which could mean fewer homes being purchased.</li> <li>Whichever groups are hit up for the "pay-fors" — the loopholes being closed — will inevitably form lobby groups and oppose those elements of the plan.</li> </ul> <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="640" height="360" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/mnuchinsteven_072717kc3_lead.jpg?1506264561" /> </div> </div> </div> http://www.zerohedge.com/news/2017-09-24/trump-tax-plan-leaked-includes-tax-cuts-wealthiest-americans-morgan-stanley-skeptica#comments Budget Committee Bush tax cuts Business Debt Ceiling Deficit Spending Donald Trump Economic policy of Donald Trump Economy Economy of the United States Fail Finance Home mortgage interest deduction Income tax in the United States Indiana Kevin Brady Morgan Stanley National Federation of Independent Business NFIB Political debates about the United States federal budget Politics Presidency of Barack Obama Real estate Republicans Salient Senate Senate Finance Committee Steven Mnuchin Supply-side economics Tax reform Trump Administration Volatility White House White House Sun, 24 Sep 2017 14:55:10 +0000 Tyler Durden 604068 at http://www.zerohedge.com Eric Peters: "One Day Your Investment Style Will Blow Up: Will You Fold Or Double Down?" http://www.zerohedge.com/news/2017-09-24/eric-peters-one-day-your-investment-style-will-blow-will-you-fold-or-double-down <p>Sunday morning brings us the traditional Weekend Notes from One River CIO, Eric Peters, whose panoply of topics under discussion today include systematic investing, economic forecasts, Fed reaction functions, Twitter algorithms, bond yields for the new abnormal, fear and greed, and of course "Rocket Man." </p> <p>Below are several excerpts from his latest weekly note:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><span style="text-decoration: underline;"><strong>Anecdote</strong></span></p> <p>&nbsp;</p> <p>“<strong>Whatever investment style you adopt will blow up someday</strong>,” said the CIO. “<strong>When that day comes, will you fold or double down</strong>?” he continued.</p> <p>&nbsp;</p> <p>We were discussing systematic investing. I see its future dominance and am building my firm accordingly.</p> <p>&nbsp;</p> <p>“If you’ve surrendered control to a machine, how will you make that decision?” he asked. Before I could answer, he supplied his own. “<strong>I’d rather practice making decisions along the way so that I’ll either avoid the blow up or at least understand my strategy in the crisis.”</strong></p> <p>&nbsp;</p> <p>That’s a credible position to take on the matter; for years I took it myself. But time changes most things, ourselves in particular. Day by day, month by month, we’re different people. Humble, hubristic, stubborn, objective, greedy, fearful, certain, confused, euphoric, depressed, and every imaginable combination thereof.</p> <p>&nbsp;</p> <p>The two greatest advantages of developing decision-making algorithms are that they allow us to consistently be our finest selves, and they can apply our process across more markets than a single human ever could. But the difficulty of distilling profound complexity into a set of robust rules leads many practitioners to cut corners - which takes the form of choosing rules that worked in the recent past for seemingly arbitrary reasons, and building algorithms without sensible risk-mitigation to avoid its corresponding costs.</p> <p>&nbsp;</p> <p><strong>Such strategies put their investors at risk of catastrophic loss in exchange for a pile of pennies, and/or tend to make money in every time period except for the future.</strong></p> <p>&nbsp;</p> <p><strong>But such pitfalls are not machine error, they reflect human weakness, </strong>and are thus common to both poorly designed discretionary and systematic strategies.</p> <p>&nbsp;</p> <p>Because ultimately, every conceivable form of successful money management requires the experience to identify rules that tend to make money over time, and the introspection necessary to come to know our finest selves. </p> </blockquote> <p><strong>Bonus #1</strong>: Peters on bond issuance in the "illiquidstan" market:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>Tajikistan issued 10yr bonds this month. Less than 1bp of mankind can locate Tajikistan on a map. Nearly all are Tajiks. </p> <p>&nbsp;</p> <p>But the bonds paid 7.125% which is roughly what pensions need to prevent insolvency. Bahrain issued $3bln of 12yr paper at 6.75% ($15bln of bids). Iraq issued $1bln at 5yrs at 6.75%. Belarus issued 10yr paper at 7.63%. And Ukraine issued $3bln of 15yrs. $1.6bln rolled existing paper that nearly defaulted 2yrs ago when investors wrote off $3.6bln in debt and delayed payments for 4yrs. </p> <p>&nbsp;</p> <p>This new issue yielded 7.37%. </p> </blockquote> <p><strong>Bonus #2: </strong>Rocket Man</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>“Did he really call me Rocket Man?” cried the chubby Korean kid. “Yes he did Rocket Man,” said some nervous sycophant in a cheap suit, saluting his Dear Leader. </p> <p>&nbsp;</p> <p>“Did he call me a scared, barking dog?” barked earth’s most powerful man, typing a tweet. “Woof!” answered the President’s pack. “He called me a suicidal madman on Twitter!” stammered shorty, combing his black bouffant. “He said he’d tame Trump with fire?” asked The Donald, incredulous, swirling his sweep. </p> <p>&nbsp;</p> <p>“He tweeted North Korea would be tested like never before!” screeched Kim, pounding the table, knuckles mere dimples, baby fat. </p> <p>&nbsp;</p> <p>“He said he’ll detonate a hydrogen bomb over the Pacific?” asked our entertainer in chief, excited, knowing a sensational season opener when he sees one. </p> <p>&nbsp;</p> <p>“Shall I go thermonuclear?” asked the itsy bitsy dictator. And his generals glanced left, right, unsure. “Shall I do it?” he screamed. The garden gnomes stood motionless. “Tell me, shall I mention Trump’s little hands?” asked Kim Jong Un, dead serious. They shook their heads in perfect unison; such a devastating insult would surely end 3.5mm years of human evolution. “Dear Leader, such an insult must be saved, savored,” pleaded his generals. “Very well, I’ll call him a dotard!” cried the child. </p> <p>&nbsp;</p> <p>“Kim called me a dotard! A dotard! What the hell does that even mean?” whispered the steward of earth’s largest nuclear arsenal. An Ivy League intern explained, “Mr. President, it’s actually pronounced DOE-turd, and it’s a middle English word used by Shakespeare that means an ageing imbecile…” The Donald cut him off, “You’re fired!” </p> <p>&nbsp;</p> <p>The room fell silent, the enormity of this unexpected crisis sinking in. You see, dotard is the kind of nickname that just might stick. </p> <p>&nbsp;</p> <p>But at least the risk of nuclear Armageddon had receded. Because of course, it’s simply not possible to end civilization amidst such buffoonery. </p> </blockquote> <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="595" height="335" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/trader%20unhappy_0.jpg?1506262552" /> </div> </div> </div> http://www.zerohedge.com/news/2017-09-24/eric-peters-one-day-your-investment-style-will-blow-will-you-fold-or-double-down#comments Actuarial science Algorithm Bond Bond Business decision-making algorithms Finance Hip hop Iraq Ivy League KIM North Korea Risk T.I. Twitter Twitter Ukraine US Federal Reserve Sun, 24 Sep 2017 14:19:28 +0000 Tyler Durden 604066 at http://www.zerohedge.com STaR SPaNGLED BLuNDeR... http://www.zerohedge.com/news/2017-09-24/star-spangled-blunder <p><a href="https://www.flickr.com/photos/expd/36615212023/in/dateposted-public/" title="THE STAR SPANGLED BLUNDER"><img src="https://farm5.staticflickr.com/4460/36615212023_b183100c07_b.jpg" alt="THE STAR SPANGLED BLUNDER" width="1024" height="642" /></a></p> <p>We certainly don't need Donald Trump to remind us that the charade called professional sports is one big commerical exploitation. That alone should be enough reason not to watch...before you even get to this performance. </p> <p>And why do they play the National Anthem before every game?&nbsp;</p> <p>If this clueless moron had the principle and sense to consider that question properly, he would simply walk away from the game. But he doesn't, because in the end it all boils down to show me the money.</p> <script src="//embedr.flickr.com/assets/client-code.js"></script> http://www.zerohedge.com/news/2017-09-24/star-spangled-blunder#comments American people of German descent Baseball Hall of Fame balloting Business Charade Climate change skepticism and denial Clueless Donald Trump Donald Trump Economy of the United States Education Horseshit Human Interest Politics Politics of the United States Sports The Apprentice WWE Hall of Fame Sun, 24 Sep 2017 13:39:46 +0000 williambanzai7 604065 at http://www.zerohedge.com