http://www.zerohedge.com/fullrss2.xml/%2A%7CARCHIVE%7C%2A/%2A%7CFORWARD%7C%2A en Move Over Greece, Italy's Crisis Will Be Worse http://www.zerohedge.com/news/2017-02-23/move-over-greece-italys-crisis-will-be-worse <p><a href="https://fee.org/articles/move-over-greece-italys-crisis-will-be-worse/"><em>Submitted by Daniel Mitchell via The Foundation for Economic Education,</em></a></p> <p>Early last month, in <a href="https://danieljmitchell.wordpress.com/2017/01/01/hopes-and-fears-for-policy-in-2017/">a column</a> on my hopes and fears for 2017, I fretted about fiscal chaos in Italy leading to default and bailouts.</p> <p><strong>Simply stated, I fear that Italy, along with certain other &ldquo;Club Med&rdquo; nations, has <a href="https://danieljmitchell.wordpress.com/2014/10/27/has-italy-passed-the-point-of-no-return-for-statism-and-big-government/">passed the point of no return</a> in terms of big government, demographic decline, and societal dependency.</strong></p> <p>And this means that, sooner or later, the proverbial <strong>wheels are going to fall off the bus.</strong> And it might be sooner.</p> <p><span style="text-decoration: underline;"><strong>On Shaky Ground</strong></span></p> <p>I don&rsquo;t always agree with his policy recommendations, but I regularly read Desmond Lachman of the American Enterprise Institute because he is one of the best-informed people in Washington on the fiscal and economic mess in Europe.</p> <p><strong>And Italy, to be blunt, is in a mess.</strong></p> <p>Here&rsquo;s what Desmond <a href="https://www.aei.org/publication/why-italys-shaky-economy-should-worry-us-all/">just wrote</a> about the country&rsquo;s economy.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>&hellip;while the euro could very well survive a Greek exit, it certainly could not survive in anything like its present form were Italy to have a full-blown economic and financial crisis that forced it to default on its public debt mountain. &hellip;Among the reasons that there should be greater concern about an Italian, rather than a Greek, economic crisis is that Italy has a very much larger economy than Greece. Being the third-largest economy in the eurozone, Italy&rsquo;s economy is around 10 times the size of that of Greece. Equally troubling is the fact that Italy has the world&rsquo;s third-largest sovereign bond market with public debt of more than $2.5 trillion. Much of this debt is held by Europe&rsquo;s shaky banking system, which heightens the risk that an Italian sovereign debt default could shake the global financial system to its core. &hellip;the country&rsquo;s economic performance since 2008 has been abysmal. Indeed, Italian living standards today are around 10 percent below where they were 10 years ago. Meanwhile, Italy&rsquo;s banking system has become highly troubled and its public sector debt as a share of gross domestic product (GDP) is now the second highest in the eurozone.&rdquo;</p> </blockquote> <p>And here&rsquo;s some of what <a href="https://www.aei.org/publication/an-italian-threat-to-the-global-economy/">he wrote</a> late last year.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>&hellip;today there would seem to be as many reasons for worrying about the Italian economy as there were for worrying about the Greek economy back in 2009. Like Greece then, Italy today checks all too many of the boxes for the making of a full-blown economic and financial crisis within the next year or two. &hellip;the Italian economy today is barely above its level in 1999 when the country adopted the Euro as its currency. Worse still, since the Great Global Economic Recession in 2008-2009, the Italian economy has experienced a triple-dip recession that has left its economy today some 7 percent below its pre-2008 crisis peak level and its unemployment rate stuck at over 11 percent. &hellip;deficiencies of its ossified labor market that contributes so importantly to the country&rsquo;s very poor productivity performance. As a result, since adopting the Euro in 1999, Italy&rsquo;s unit labor costs have increased by around 15 percentage points more than have those in Germany. &hellip;Italian banks now have around EUR 360 billion in non-performing loans, which amounts to a staggering 18 percent of their loan portfolio. If that were not bad enough, the Italian banks also hold unhealthily large amounts of Italian government debt, which now total more than 10 percent of their overall assets. &hellip;the country&rsquo;s public debt level has risen from 100 percent of GDP in 2008 to 133 percent of GDP at present.&rdquo;</p> </blockquote> <p>The numbers shared by Lachman are downright miserable.</p> <p><strong>And he&rsquo;s not the only one pointing out that Italy&rsquo;s economy is in the toilet.</strong></p> <p><img src="https://fee.org/media/21130/chart_mitchellblog.png?width=600&amp;height=376.32093933463796" style="height: 376px; width: 600px;" /></p> <p>I shared numbers last year showing the <a href="https://danieljmitchell.wordpress.com/2016/01/18/the-rise-and-fall-and-rise-and-fall-of-italy/">pervasive stagnation</a> in the country.</p> <p><u><strong>Falling Birthrates</strong></u></p> <p><em><strong>So what&rsquo;s the Italian government doing to solve these problems? Is it slashing tax rates? Reducing the burden of government? Cutting back on red tape?</strong></em></p> <p><em><strong>Of course not. The politicians are either making things worse or engaging in pointless distractions.</strong></em></p> <p>Speaking of which, I&rsquo;m tempted to laugh at the Italian government&rsquo;s campaign to boost birthrates. Here&rsquo;s some of what&rsquo;s been <a href="https://www.nytimes.com/2016/09/14/world/europe/italy-births-fertility-europe.html">reported</a> by the <em>New York Times</em>.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>&hellip;a government effort to promote &ldquo;Fertility Day&rdquo; on Sept. 22, a campaign intended to encourage Italians to have more babies. &hellip;Italy has one of the lowest birthrates in the world&hellip; Italian families have been shrinking for decades. In 2015, 488,000 babies were born in Italy, the fewest since the country first unified in 1861. It has one of the lowest birthrates in Europe, with 1.37 children per woman, compared with a European average of 1.6, according to Eurostat figures.&quot;</p> </blockquote> <p>By the way, I actually commend the government for recognizing that falling birthrates are a problem.</p> <p>Not because women should feel obliged to have kids if that&rsquo;s not what they want. But rather because Italy has a massive tax-and-transfer welfare state that is predicated on an ever-expending population of workers (i.e., taxpayers) to finance benefits to retirees.</p> <p>But <a href="https://danieljmitchell.wordpress.com/2016/03/08/demographics-entitlements-europes-doom/">old people are living longer</a> and low birthrates mean that there won&rsquo;t be enough taxpayers to prop up the Ponzi Scheme of big government.</p> <p>But while the government deserves kudos for acknowledging a problem, it deserves mockery for thinking empty slogans will make a difference.</p> <p><u><strong>More of the Same</strong></u></p> <p>Moreover, there&rsquo;s also a problem in that Italian voters have been so conditioned to expect handouts that they think the answer to the problem is even more government!</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>The problem is not a lack of desire to have children, critics of the campaign say, but rather the lack of meaningful support provided by the government and many employers. &hellip;&rdquo;I still feel very offended,&rdquo; said Vittoria Iacovella, 37, a journalist and mother of two girls, ages 10 and 8. &ldquo;The government encourages us to have babies, and then the main welfare system in Italy is still the grandparents.&rdquo; &hellip;Italy&rsquo;s government has tried to help families with a so-called baby bonus of 80 to 160 euros, or about $90 to $180, for low- and middle-income households, and it has approved labor laws giving more flexibility on parental leave.&quot;</p> </blockquote> <p><strong>Ms. Iacovella is crazy for thinking that more taxes, more spending, more regulation, and more mandates will make things better.</strong></p> <p>Heck, even <a href="https://danieljmitchell.wordpress.com/2015/05/26/amazing-admission-from-new-york-times-columnist-on-how-feminist-economic-policies-hurt-women/">leftists are now admitting</a> such laws undermine employment and specifically hurt women by making them less attractive to employers.</p> <p>Meanwhile, the Italian government is taking lots of other dumb steps. Including, as <a href="http://www.telegraph.co.uk/news/2016/08/23/italian-teenagers-to-receive-500-cultural-bonus-from-government/">reported</a> by the <em>Telegraph</em>, creating a new entitlement for teenagers.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>Italian school leavers may face the dismal prospect of 40 per cent youth unemployment, but at least they have one thing to look forward to &ndash; a &euro;500 &ldquo;culture bonus&rdquo;, courtesy of the government. From next month, every 18-year-old will be entitled to claim the money and spend it on culturally&nbsp;enriching pursuits such as going to theatres, concerts and museums, visiting archaeological sites, and buying books. The scheme, which starts on Sept 15, will benefit 575,000 teenagers, at a cost to the government of &euro;290 million (&pound;250 million).&quot;</p> </blockquote> <p>By the way, is anyone shocked to learn that Italian teenagers look forward to these handouts?</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>&hellip;it has been welcomed by 18-year-olds, who face a difficult economic landscape when they leave school &ndash; high unemployment, a lack of secure, long-term contracts and an economy that has performed dismally for a decade. &ldquo;Of course we&rsquo;re happy&hellip;,&rdquo; said Angelica Magazzino, a teenager from the southern region of Puglia who turns 18 in November.&quot;</p> </blockquote> <p><strong>If you read the entire story, you&rsquo;ll learn that the government justifies this new entitlement by saying it will fight terrorism.</strong> I don&rsquo;t know if that&rsquo;s more crazy or less crazy than <a href="https://danieljmitchell.wordpress.com/2015/12/01/make-up-your-minds-crazy-statists-is-terrorism-caused-by-climate-change-or-inequality/">the American leftists</a> who blame terrorism on climate change or inequality.</p> <p><u><strong>Say What?</strong></u></p> <p>Last but not least, CNN is <a href="http://www.cnn.com/2016/09/08/europe/italy-supreme-court-masturbation/index.html">reporting</a> that the government is also enabling other forms of Italian &ldquo;culture.&rdquo;</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em><strong>Italy&rsquo;s highest court has ruled that masturbation in public is not a crime, as long as it is not conducted in the presence of minors.&quot;</strong></em></p> </blockquote> <p>No, this is not a joke.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>The decision came down from the Italian Supreme Court&hellip;in the case of a 69-year-old man&hellip;The man was convicted in May 2015 after he performed the act in front of students on the University of Catania campus, according to documents filed with Supreme Court. The man was sentenced to three months in prison and ordered to pay a fine of &euro;3,200 (around $3,600). However, the defendant&rsquo;s lawyer appealed the case to the country&rsquo;s highest court, which ruled on the side of the accused in June but only just made its decision public. Judges ruled that public masturbation out of the presence of minors is no longer deemed criminal conduct due to a change in the law last year, which decriminalized the act.&quot;</p> </blockquote> <p>Great. I&rsquo;m looking forward to my next trip to Italy. Though I guess it&rsquo;s nice to see Italian seniors are staying active in their communities.</p> <p><strong>More seriously, this is why I&rsquo;m sympathetic to Italians that are either <a href="https://danieljmitchell.wordpress.com/2012/07/18/the-turbo-charged-italian-version-of-the-laffer-curve/">privately dodging</a> or <a href="https://danieljmitchell.wordpress.com/2012/05/14/revolt-of-the-italian-tax-slaves/">publicly revolting</a> when you have a government this <a href="https://danieljmitchell.wordpress.com/2011/09/20/how-elected-officials-screw-taxpayers-the-italian-porn-star-version/">profligate</a> and <a href="https://danieljmitchell.wordpress.com/2011/12/02/the-italian-version-of-great-moments-in-government-incompetence/">senseless</a>.</strong></p> <p><em>P.S. Amazingly, <a href="https://danieljmitchell.wordpress.com/2012/08/17/its-not-april-fools-day-but-new-york-times-columnist-wants-america-to-become-more-prosperous-by-raising-taxes-on-the-middle-class-and-becoming-more-like-italy/">some leftists think</a> the United States should have a bigger government and be more like Italy.</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="282" height="154" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170223_italeave.jpg?1487908741" /> </div> </div> </div> http://www.zerohedge.com/news/2017-02-23/move-over-greece-italys-crisis-will-be-worse#comments American Enterprise Institute Bond Business default Economic history of Italy Economy Economy of Italy Economy of the European Union Euro Eurozone Eurozone Eurozone crisis Foundation for Economic Education Germany Government debt Greece Greek withdrawal from the eurozone Gross Domestic Product Italian government Italian government debt Italian Supreme Court Italy Italy’s government New York Times non-performing loans Recession Sovereign Debt Stock market crashes Time Unemployment University of Catania Fri, 24 Feb 2017 10:00:00 +0000 Tyler Durden 588876 at http://www.zerohedge.com French Voters Call On Obama To Run For President To "Give French People Hope" http://www.zerohedge.com/news/2017-02-23/group-french-protesters-call-obama-run-president-give-french-people-hope <p>As French voters look set to make a massive swing to the right in their upcoming presidential election (see our notes on the topic <a href="http://www.zerohedge.com/news/2017-02-14/le-pen-odds-surge-french-stock-market-risk-hits-5-year-high">here</a> and <a href="http://www.zerohedge.com/news/2017-02-04/le-pen-kicks-presidential-campaign-echoing-trump-highlights-her-manifesto">here</a>), a <strong>group of frightened liberal protesters have decided to back a relatively surprising, if impossible, presidential candidate in 2017, Barack Obama.</strong>&nbsp; </p> <p>And, lest you thing this is a joke, a quick walk around Paris even reveals campaign posters for "Obama17" plastered all around the city.</p> <p><img src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/02/23/2017.02.23%20-%20Obama17%202.JPG" alt="Obama17" width="672" height="522" /></p> <p>&nbsp;</p> <p>The group of protesters who launched the effort to bring "hope and change" to France are urging French citizens to visit their <a href="http://obama2017.fr/">website</a> to sign a petition to convince Obama to enter the race.&nbsp; They figure that 1 million signatures should do the trick.</p> <p>Meanwhile, asked why they support Obama, protesters told <a href="http://abcnews.go.com/International/obama-devotees-france-hoping-obama17-presidential-campaign/story?id=45680072">ABC News</a> they're <strong>looking for a candidate they "really admire" and "someone who could lead us to project ourselves in a bright future to give French people hope."</strong></p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>Why Obama? <strong>"Because he has the best resume in the world for the job,"</strong> reads the website, which is in no way connected to Obama.</p> <p>&nbsp;</p> <p><strong>"At a time when France is about to vote massively for the extreme right, we can still give a lesson of democracy to the planet by electing a French President, a foreigner,</strong>" reads the website in French.</p> <p>&nbsp;</p> <p>A spokesperson for the group told ABC News Thursday morning, "We started dreaming about this idea two months before the end of Obama's presidency. We dreamed about this possibility to vote for someone we really admire, <strong>someone who could lead us to project ourselves in a bright future.</strong> Then, we thought, whether it's possible or not, whether or not he is French, <strong>we have to do this for real, to give French people hope ... Vive la République, Vive Obama, Vive la France and the U.S.A." </strong></p> </blockquote> <p>And while we have our doubts about the likelihood of this plan working out, <strong>might we suggest that Hillary Clinton would make a great candidate for a senior cabinet position in Obama's new administration. <br /></strong></p> <p><img src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/02/23/2017.02.23%20-%20Obama17_0.JPG" alt="Obama17" width="600" height="293" /></p> <p>&nbsp;</p> <p>Of course, while it's a genius plan, if we understand it correctly, there is just one minor problem...the French president needs to be, well, French.</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="672" height="522" alt="" src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017.02.23%20-%20Obama17%202.JPG?1487869608" /> </div> </div> </div> http://www.zerohedge.com/news/2017-02-23/group-french-protesters-call-obama-run-president-give-french-people-hope#comments ABC News Barack Obama Barack Obama Barack Obama presidential primary campaign France Hillary Clinton International media reaction to the United States presidential election Politics Politics Presidency of Barack Obama Progressivism in the United States United States Fri, 24 Feb 2017 09:15:00 +0000 Tyler Durden 588839 at http://www.zerohedge.com How Does A Stock Market Operate In War? Syria - A Case Study http://www.zerohedge.com/news/2017-02-23/how-does-stock-market-operate-war-syria-case-study <p><em><a href="https://www.tradingfloor.com/posts/how-does-a-stock-market-operate-in-war-syria-a-case-study-8484644">Submitted by Saxo Group&#39;s Jack Davies, via TradingFloor.com,</a></em></p> <ul> <li><strong>Last year was the Damascus&nbsp;Securities Exchange&#39;s busiest on record</strong></li> <li><strong>The majority of shares traded on the exchange are in foreign-owned banks</strong></li> <li><strong>Those banks are grossly overvalued by &quot;financial&nbsp;engineering&quot;</strong></li> <li><strong>Increased activity could suggest improved confidence in the Syrian economy</strong></li> <li><strong>But it could also suggest Syrian investors&#39; lack of alternatives</strong></li> </ul> <p><img alt="tank" src="https://www.tradingfloor.com/images/article/max608w/34d46ebf-f681-48f8-97af-c8ed9751b998.png" style="height: 344px; width: 599px;" /></p> <p><em>Forces loyal to the Assad regime have made considerable gains in recent months.&nbsp;On the surface this appears&nbsp;to be reflected on the Syrian stock&nbsp;exchange &ndash; but all is not as it seems.</em></p> <p>Despite enduring more than half a decade of conflict leaving an estimated 400,000 dead and 11.4 million displaced, Syria retains an active stock market.</p> <p>Established as part of a programme of economic reforms, the Damascus Securities Exchange opened its doors in 2009, two years before the onset of the crisis.</p> <p>Not only does the market continue to function despite the conflict, if data published daily on the exchange&rsquo;s website is to be believed, last year was its most active on record in terms of volume of trades and 2017 looks set to be busier still.</p> <p><img alt="volume" src="https://www.tradingfloor.com/images/article/max608w/1ef0b577-9938-477d-90f3-5370f3977cad.png" style="height: 366px; width: 600px;" /></p> <p><em>Source: Damascus Securities Exchange (2017 data only reflects the first month and half of trading, of course.) </em></p> <p>While under ordinary circumstances, such data might be interpreted as suggesting renewed confidence in the economy; the circumstances in Syria are far from ordinary and analysts say activity on the exchange are largely the product of a fiction.</p> <p>&ldquo;Measured in the number of shares traded, the volume may be up but their value is down significantly, even when denoted in Syrian pounds,&rdquo; Dr Reinoud Leenders of Lebanon and Syria Research Group tells TradingFloor by email. <em><strong>&ldquo;Market capitalisation may seem to be on the rise but this hardly reflects real economic terms due to very high inflation and the steep fall in the exchange value of the Syrian pound.&rdquo;</strong></em></p> <p>The Syrian pound has fallen dramatically since the start of the conflict. In 2010, you would have needed just shy of &pound;50 to buy $1; today you would need more than &pound;500 to get your hands on $1.</p> <p><u><strong>Subdued activity</strong></u></p> <p>Additionally, Leenders points out, there are only about half a dozen stocks that are actively traded on the exchange. Almost all of them are subsidiaries of foreign banks.</p> <p>Rashad al-Kattan is a graduate of Damascus University. Now based in the UK, he works as a risk analyst and holds a fellowship at St Andrews University&rsquo;s Centre for Syrian Study. Having previously worked for Lebanese-owned banks in Syria, the bulk of his academic research focuses on his homeland&rsquo;s banking sector and stock exchange.</p> <p><em><strong>&ldquo;If you look at the indices, banks are the most traded,&rdquo; </strong></em>says al-Kattan.<em><strong> &ldquo;I would be surprised if those investors are actually doing any due diligence because the banks &ndash; and this was acknowledged by the exchange&rsquo;s general manager &ndash; although they appear profitable, they are engaged in financial engineering.&rdquo;</strong></em></p> <p>Al-Kattan recounts how his former colleagues who were once employed by the corporate services department of their banks are now in the loan recovery department, which he says reflects the reality that &ndash; for the time being, at least &ndash; profit generation has all but ceased within the banks and in its place is loss reduction.</p> <p>While attempting to identify their few remaining borrowers able to repay their loans is one way of attempting to reduce their losses, al-Kattan says a more efficient and insidious technique is also being employed.</p> <p><em><strong>&ldquo;[The banks&rsquo;] equity is paid in US dollars. What they&rsquo;ve been doing each year is recognising those dollars in Syrian pounds, and because the pound is depreciating it seems their profits are going up,&rdquo; </strong></em>says al-Kattan. &ldquo;Of course, in order to do that you have to engage in a transaction; but the Central Bank has been very lenient with that because they don&rsquo;t want to make the banks look loss making and generate panic.&rdquo;</p> <p>The banks in question are, of course, obliged to submit quarterly reports and statements, which contain these fictional profits.</p> <p><em><strong>&ldquo;Their statements are endorsed by international auditing firms. They&rsquo;re not saying anything because they know how the game is played. Looking at those banks, as an investor, I would not think they&rsquo;re a good investment.&rdquo;</strong></em></p> <p>But if the valuation of the banks is so inflated, why would anyone bother to invest in them? One answer, according to Kings College&rsquo;s Dr Leenders is that both bankers and investors haven&rsquo;t got anywhere else to go.</p> <p><em><strong>&ldquo;Both are glued to the regime&rsquo;s survival and/or are curtailed in their decisions by international sanctions,&rdquo;</strong></em> he says in emailed remarks. &ldquo;In this context, putting their money in either real estate or banks seems a sensible strategy, exactly because the rest of the economy fails (for now) to provide alternatives.&rdquo;</p> <p><u><strong>Room for optimism</strong></u></p> <p>And while both Leenders and al-Kattan agree that the Syrian economy is in tatters, there are some causes for optimism for those who have bet their money on it recovering.</p> <p><strong>The rebound in trading on the Damascus Securities Exchange does coincide with the arrival of a large amount of Russian air and ground forces in Syria, and the re-capture of Aleppo by regime-aligned forces in December coincided with a massive uptick in trades on the exchange in the last quarter of 2016.</strong></p> <p><img alt="2016" src="https://www.tradingfloor.com/images/article/max608w/b9a07b7f-fb4c-4ae1-8809-a06eaba36d17.png" style="height: 359px; width: 600px;" /></p> <p><em>Source: Damascus Securities Exchange.</em></p> <p>&ldquo;But assuming that the banks are indeed banking on a regime victory (and henceforth in this context hoping for a likely influx of aid and remittances for recovery), this doesn&rsquo;t mean the conflict is expected to come to an end,&rdquo; says Leenders.<strong><em> &ldquo;I guess from a banker&rsquo;s perspective all that matters is that the regime captures and consolidates control in key economic areas; the rest of the country could still be under rebel control.&rdquo;</em></strong></p> <p>Although hopes of an uptick in aid might be not be realised as soon as those banks would hope. The Syrian minister of economy announced recently that any reconstruction contracts awarded to foreign companies would be contingent upon apologies from Europe and the US for their role in the conflict, the Syria Report said this week.</p> <p>Another indication that perhaps things may be on the verge of looking up for Syrian investors is that the construction of a 701 megawatt power station south of Damascus by Athens-headquartered international engineering firm Metka is reportedly nearing completion.</p> <p>On Wednesday, Syriatel &ndash; one of the country&#39;s two mobile phone service providers, headed by the president Bashar al-Assad&#39;s maternal cousin Rami Makhlouf &ndash; signed an agreement with the exchange to list its shares publicly.</p> <p>Al-Kattan, too, does not believe the economic situation is going to get any worse: &ldquo;Generally speaking, I don&rsquo;t think the Syrian pound will suffer more. I think in the next few months it will improve and might even go back to 400 [per dollar] with foreign cash injections,&rdquo; he says.</p> <p>But in terms of the stock exchange&rsquo;s viability, he is not so optimistic. With 90% of the population dependent on foreign or government aid for survival and less than a fifth of the population even holding bank accounts, the exchange will continue to find itself with a limited base of investors, he says.</p> <p><em><strong>&ldquo;How will it develop? Not a lot better than what we&rsquo;ve seen before,&rdquo; he says. &ldquo;In terms of raising capital, we&rsquo;re still a long way from that.&rdquo;</strong></em></p> <p>Al-Kattan says that one of the reasons he chose to focus his research on the Syrian economy and in particular its banking sector is that &ldquo;everyone is obsessed with ISIL and military balance of power and no one is focused on the economy.&rdquo;</p> <p><em><strong>&ldquo;I think this is important. While we&rsquo;re talking about dealing with the regime, people believe the banks they dealt with before the conflict are the same, but I would argue they present very substantial risks.&rdquo;</strong></em></p> <p>Representatives of the Damascus Securities Exchange acknowledged but did not respond to multiple requests for comment.</p> <p><img alt="h" src="https://www.tradingfloor.com/images/article/max608w/064e0ca8-2fd6-4ce3-98de-800fd62b2208.jpg" /></p> <p><em>Syria&#39;s stock exchange is far from being built on solid foundations.</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="565" height="297" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170223_syria.jpg?1487908287" /> </div> </div> </div> http://www.zerohedge.com/news/2017-02-23/how-does-stock-market-operate-war-syria-case-study#comments Andrews University’s Centre for Syrian Study Asia Business cellular telephone Damascus Damascus Securities Exchange Damascus University Economy of Syria Geography of Asia Kings College Levant Real estate Reality recovery Stock exchange Stock market Syria Fri, 24 Feb 2017 08:30:00 +0000 Tyler Durden 588875 at http://www.zerohedge.com Le Pen Is Mightier Than The Sword http://www.zerohedge.com/news/2017-02-23/le-pen-mightier-sword <p>Presented with no comment...</p> <p>&nbsp;</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/02/19/20170223_free1.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/02/19/20170223_free1_0.jpg" width="600" height="408" /></a></p> <p><a href="http://grrrgraphics.com/index.html"><em>Source: Ben Garrison</em></a></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="901" height="612" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170223_free1.jpg?1487907919" /> </div> </div> </div> http://www.zerohedge.com/news/2017-02-23/le-pen-mightier-sword#comments Ben Cinema of the United States Elo rating system English-language films Entertainment Films Speculative fiction Technology Fri, 24 Feb 2017 07:45:00 +0000 Tyler Durden 588874 at http://www.zerohedge.com "Mystery Poison" Used To Murder Kim Jong Nam Revealed As VX Nerve Agent http://www.zerohedge.com/news/2017-02-23/mystery-poison-used-murder-kim-jong-nam-vx-nerve-agent <p>What was until recently was a real-life reincarnation of the move "The International", just got a double dose of "The Rock" thrown in for good measure.</p> <p><iframe src="https://www.youtube.com/embed/3sXqD_qBEoo" width="500" height="281" frameborder="0"></iframe></p> <p>When yesterday <a href="http://www.zerohedge.com/news/2017-02-22/hands-kim-jong-nams-killers-were-coated-mystery-poison">we shared </a>the most recent update in the bizarre assassination of Kim Jong Nam, the half brother of North Korea's ruler, who was murdered in broad daylight inside Kuala Lumpur's budget airline terminal, we reported that while the two women suspected in the fatal poisoning attack had coated their hands with "mystery" toxic chemicals which they then wiped on Nam's face, a key question remained unanswered, namely what was the poison used to by the woman with the "LOL" shirt used to murder the North Korean scion.</p> <p><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/02/08/LOL%20woman_0.jpg" width="500" height="283" /></p> <p>As <a href="http://www.cbsnews.com/news/kim-jong-nam-deadly-poison-mystery-baffles-experts/">CBS reported previously</a>, experts routinely tasked with finding answers in poisoning cases were stumped: what substance could have been used to kill the victim so quickly without sickening the women who apparently deployed it, along with anyone else nearby? Difficult, they said, but doable. </p> <p>“It’s not an agent that could be cooked up in a hotel room. It’s going to take a lot of knowledge regarding the chemical in order to facilitate an attack like this,” said Bruce Goldberger, a leading toxicologist who heads the forensic medicine division at the University of Florida. He said a nerve gas or ricin, a deadly substance found in castor beans, could be possible. A strong opioid compound could also have been used, though that would likely have incapacitated the victim immediately. </p> <p>“It would have to be cleverly designed in order to be applied in this fashion without hurting anyone else,” Goldberger said.</p> <p>“The more unusual, the more potent, the more volatile a poison is, the less likely it is to be detected,” said Olif Drummer, a toxicologist at Australia’s Victorian Institute of Forensic Medicine who has spent 40 years in the field. Khalid said the women knew they were handling poisonous materials and "were warned to take precautions." Surveillance footage showed both keeping their hands away from their bodies after the attack, he said, then going to restrooms to wash. Such details are unclear in video footage that has been released to media. </p> <p>Well, moments ago the Malaysian police provided the answer, when it reported that the chemical substance used to kill Kim Jong Nam last week was the nerve agent right out of the movei "The Rock" <a href="https://en.wikipedia.org/wiki/VX_(nerve_agent)">called VX,</a> which happens to be listed as a weapon of mass destruction by the United Nations. </p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/02/08/rock%20vx%202.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/02/08/rock%20vx%202_0.jpg" width="500" height="275" /></a></p> <p>Khalid Abu Bakar, Malaysia’s inspector general of police, said Friday in a statement that identification of the substance came from a preliminary report. He said swabs were taken from the eye and face of the victim. </p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/02/08/VX%20gas.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/02/08/VX%20gas_0.jpg" width="500" height="325" /></a></p> <p>VX is described by the US Centers for Disease Control and Prevention as “the most potent of all nerve agents”, with a large dose leading to loss of consciousness, paralysis and respiratory failure. Its only known use is as a chemical warfare agent.&nbsp; </p> <p>VX is banned under the UN Chemical Weapons Convention, to which North Korea is not a party. </p> <p>The nerve agent, also known as ethyl N-2-Diisopropylaminoethyl Methylphosphonothiolate, was developed in the UK in the 1950s. </p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/02/08/VX%20nerve%20agent.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/02/08/VX%20nerve%20agent_0.jpg" width="500" height="250" /></a></p> <p>As <a href="https://www.ft.com/content/228d4ef6-fa2d-11e6-9516-2d969e0d3b65?emailId=58af91e3f59cf000043ade37&amp;segmentId=3d08be62-315f-7330-5bbd-af33dc531acb">the FT further adds</a>, Malaysian police are seeking at least four North Korean suspects in connection with the murder, who are now believed to be back in Pyongyang. Two other North Korean nationals, including a diplomat in Malaysia, are wanted for questioning. </p> <p>Police have detained a Vietnamese woman, an Indonesian woman and a North Korean man in connection with Kim’s death. </p> <p>The murder has frayed relations between North Korea and Malaysia, which this week recalled its ambassador from Pyongyang.</p> <p>In the aftermath of the fallout from North Korea's ballistic missile launch and alleged orchestration of Kim Jong Nam's murder, <a href="http://www.zerohedge.com/news/2017-02-23/china-prepares-regime-collapse-north-korea">we reported earlier today </a>that China, which last weekend announced it would ban all coal imports from North Korea, was preparing for "regime collapse" in North Korea, and would "take the necessary measures to safeguard national security in the event of the collapse of the neighbouring North Korean regime", a defence official said on Thursday.&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="1600" height="881" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/rock%20vx%202.jpg?1487902950" /> </div> </div> </div> http://www.zerohedge.com/news/2017-02-23/mystery-poison-used-murder-kim-jong-nam-vx-nerve-agent#comments Amines Australia’s Victorian Institute of Forensic Medicine Chemical warfare Chemistry China Florida Forms of government KIM Kim dynasty Kim Jong-nam Malaysian police national security Nerve agent North Korea North Korea Political philosophy Politics U.S. Centers for Disease Control and Prevention United Nations University of Florida VX Fri, 24 Feb 2017 07:20:15 +0000 Tyler Durden 588871 at http://www.zerohedge.com In The Police-State-Versus-Freedom Arms Race, Freedom Seems To Be Winning http://www.zerohedge.com/news/2017-02-23/police-state-versus-freedom-arms-race-freedom-seems-be-winning <p><a href="http://dollarcollapse.com/creeping-fascism/police-state-versus-freedom-arms-race/"><em>Submitted by John Rubino via DollarCollapse.com,</em></a></p> <p>In the past 48 hours, two stories broke that illustrate how dominant technology has become in th<strong>e age-old war between freedom and control:</strong></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><h2><a href="https://www.wired.com/2017/02/malware-sends-stolen-data-drone-just-pcs-blinking-led/?mbid=nl_22217_p2&amp;CNDID=38901740" target="_blank">Malware Lets a Drone Steal Data by Watching a Computer&rsquo;s Blinking LED</a></h2> <p>(Wired) &ndash; A group of researchers at Ben-Gurion&rsquo;s cybersecurity lab has devised a method to defeat the security protection known as an &ldquo;air gap,&rdquo; the safeguard of separating highly sensitive computer systems from the internet to quarantine them from hackers. If an attacker can plant malware on one of those systems&mdash;say, by paying an insider to infect it via USB or SD card&mdash;this approach offers a new way to rapidly pull secrets out of that isolated machine. Every blink of its hard drive LED indicator can spill sensitive information to any spy with a line of sight to the target computer, whether from a drone outside the window or a telescopic lens from the next roof over.</p> <p style="text-align: center;">&mdash;&mdash;&mdash;&mdash;-</p> <h2><a href="http://money.cnn.com/2017/02/22/media/james-okeefe-cnn/" target="_blank">Conservative provocateur targets CNN with secret recordings</a></h2> <p>(CNN) &ndash; Conservative provocateur James O&rsquo;Keefe is setting his sights on CNN.</p> <p>&nbsp;</p> <p>O&rsquo;Keefe said in a telephone interview with CNN on Wednesday that he has &ldquo;a few hundred hours&rdquo; of &ldquo;secretly recorded material&rdquo; from inside the network. &ldquo;We&rsquo;re calling it CNN Leaks,&rdquo; he said, drawing inspiration from WikiLeaks&rsquo; document dumps.</p> <p>&nbsp;</p> <p>He said &ldquo;part one&rdquo; would be published Thursday at about 10 a.m. ET. &ldquo;This is all legally recorded information,&rdquo; he said, declining to be more specific.</p> </blockquote> <p><strong>The first article illustrates the extraordinary &ndash; and increasing &mdash; power that cutting-edge tech offers governments to watch and otherwise control their citizens. </strong>Combine the above relatively-narrow-gauge application with the NSA&rsquo;s existing ability to monitor pretty much every electronic signal, facial recognition software that can pick individuals out of crowds, algorithms that lip read, and tiny drones that can see without being seen, and the potential result is a police state that&rsquo;s slicker, subtler and therefore scarier than anything envisioned in <a href="http://www.shortlist.com/news/20-best-dystopian-novels" target="_blank">dystopian novels like <em>Brave New World</em> or <em>1984</em>.</a></p> <p><strong>But the second story is the counterweight, illustrating how those same technologies are being used around the world to expose the secrets of the powerful. </strong>Where <a href="http://www.pbs.org/pov/mostdangerousman/timeline/" target="_blank">Daniel Ellsberg</a> once had to spend months photocopying the Pentagon Papers and physically sneaking them out of his Defense Department office, today all that&rsquo;s required for a major leak is one disillusioned or otherwise motivated insider with a thumb drive, laptop or smart phone.</p> <p>In just the past few years, <a href="http://fortune.com/sony-hack-part-1/" target="_blank">Sony&rsquo;s emails</a> were hacked and released, to the profound embarrassment of Hollywood; US military misbehavior was exposed by a lowly private named <a href="https://www.washingtonpost.com/world/national-security/judge-to-sentence-bradley-manning-today/2013/08/20/85bee184-09d0-11e3-b87c-476db8ac34cd_story.html?utm_term=.e8495b8d35b9" target="_blank">Bradley Manning</a>; the <a href="https://www.washingtonpost.com/news/the-fix/wp/2016/07/24/here-are-the-latest-most-damaging-things-in-the-dncs-leaked-emails/?utm_term=.fb1e2e225a67" target="_blank">Democrat National Committee&rsquo;s emails</a> &ndash; which exposed collusion between political operatives and mainstream media, among many other things &mdash; were published just in time to cost that party the presidency; and of course the great <a href="https://en.wikipedia.org/wiki/Edward_Snowden" target="_blank">Edward Snowden</a>, an outside contractor for the NSA, exposed the breathtaking illegality of US spying here and abroad.</p> <p><strong>Every big organization now lives with the knowledge that it&rsquo;s one leak away from existential crisis &mdash; and that there is no fix. </strong>Doing big, bad things requires a lot of people with the ability to access and understand what you&rsquo;re doing. And it only takes one of them with widely-available technology to expose you to the whole world.</p> <p>With all the issues now dividing people &ndash; abortion, Israel, immigration, etc., etc. &ndash; this might be the most telling. <em><strong>Do you see Snowden and <a href="https://en.wikipedia.org/wiki/WikiLeaks" target="_blank">WikiLeaks&rsquo; Julian Assange</a> as traitors or heroes? Because the worlds in which they end up one or the other couldn&rsquo;t be more different.</strong></em></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="262" height="116" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170223_free.jpg?1487907715" /> </div> </div> </div> http://www.zerohedge.com/news/2017-02-23/police-state-versus-freedom-arms-race-freedom-seems-be-winning#comments Chelsea Manning Cypherpunks Daniel Ellsberg Democrat National Committee Department of Defense Edward Snowden Espionage ETC facial recognition Government Israel Julian Assange Keefe National security News leaks Pentagon Politics same technologies smart phone Snowden SPY WikiLeaks Fri, 24 Feb 2017 07:00:00 +0000 Tyler Durden 588873 at http://www.zerohedge.com Tucker Carlson Takes on DNC Advisor Who Doesn't Know How to Identify a Gender http://www.zerohedge.com/news/2017-02-23/tucker-carlson-takes-dnc-advisor-who-doesnt-know-how-identify-gender <p>So why does 'the party of science', the enlightened ones, the people with thousands of scientists from accredited colleges throughout the country who tell us about dangers of global warming, carbon emissions, and how many vegetables to eat on a daily basis -- cling to the inane subject of 'gender identity'? You'd think that these men of letters would eschew rudimentary 'feelings' and only accept the biology of one's gender when determining which bathroom he/she could use. But this isn't about science, in spite of what they tell you. </p> <p>Thousands of years ago, when the Romans would conquer territories that were hostile, they'd enter villages and take the men as slaves and order the women to raise her children loyal to the Roman standard. To make an example, often times they'd kill one of her children, so she knew they meant business. After a generation of destroying families, these territories were docile and soft -- loyal to the Roman power structure.</p> <p>Today we have a corrupt establishment on its last legs, fighting desperately to keep its citizens in line. After decades of permitting drugs to ravage through minority communities, passing harsh drug laws designed to break up and destroy the black family structure, the nuclear black family is on its last legs. In 1965, just before the onset of the drug epidemic, 76.4% of black children were born into married households. Today, 77% of first black births are born into pre-marital households. </p> <p>So what the fuck happened? </p> <p>The men were carted off to jail, while the women were left tending to her children, as wards of the state.</p> <p>Sound familiar?</p> <p>Now the target is everyone else. While oxycontin and meth have done a number on white neighborhoods throughout the country, it wasn't working fast enough to truly break the family structure -- especially in well-heeled families. </p> <p>Enter the gender identity crisis. What better way to disrupt the family structure and create a generation of mentally challenged morons than to have them question the very essence of life and purpose: identity and procreation? Schools are pushing this hard on children, creating safe zones and sexualizing institutions that were never designed to do that. In other words, the state is attempting to take control of your children's' minds by blurring the lines of gender, confusing them and galvanizing a generation of potential social justice warriors who will fight the good fight for 'human rights', aka become WARDS OF THE STATE.</p> <p>Rant over.</p> <p>Here is Tucker Carlson, proving, once and for all, the DNC is run by complete morons, unable to answer a simple question: what makes a person a man?</p> <p><iframe src="https://www.youtube.com/embed/eTDL_tGAWt4" width="560" height="315" frameborder="0"></iframe></p> <p>The correct answer should've been, 'your balls.'</p> <p><strong>Content originally generated at <a href="https://ibankcoin.com/">iBankCoin.com</a></strong></p> http://www.zerohedge.com/news/2017-02-23/tucker-carlson-takes-dnc-advisor-who-doesnt-know-how-identify-gender#comments Biology Carbon Emissions Gender Gender identity Gender studies Global Warming Identity Passing Self Social constructionism Social Issues Sociology of gender Transgender Fri, 24 Feb 2017 04:36:24 +0000 The_Real_Fly 588877 at http://www.zerohedge.com In A Battle Between Trump And The Federal Reserve, Who Really Wins? http://www.zerohedge.com/news/2017-02-23/battle-between-trump-and-federal-reserve-who-really-wins <p><a href="http://www.alt-market.com/articles/3134-in-a-battle-between-trump-and-the-federal-reserve-who-really-wins"><em>Submitted by Brandon Smith via Alt-Market.com,</em></a></p> <p><em><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/02/19/20170223_alt.jpg"><img height="287" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/02/19/20170223_alt.jpg" width="478" /></a></em></p> <p>As a part of the increasingly obvious set-up of conservative movements by international banking interests and globalist think-tanks, I have noticed an expanding disinformation campaign which appears to be designed to wash the Federal Reserve of culpability for the crash of 2008 that has continued to fester to this day despite the many claims of economic &ldquo;recovery.&rdquo;&nbsp; <strong><em>I believe this program is meant to set the stage for a coming conflict between the Trump Administration and the Fed, but what would be the ultimate consequences of such an event?</em></strong></p> <p>In my article <a href="http://www.alt-market.com/articles/3102-the-false-economic-recovery-narrative-will-die-in-2017">&#39;The False Economic Recovery Narrative Will Die In 2017&#39;</a>, I outlined the propaganda trap being established by globalist owned and operated media outlets like Bloomberg, in which they consistently claim that Donald Trump has &ldquo;<a href="https://www.bloomberg.com/news/articles/2016-12-29/what-history-has-to-say-about-the-economy-trump-will-inherit" target="_blank">inherited</a>&rdquo; an economy in recovery and ascendancy from the Obama administration.&nbsp; I thoroughly debunked their positions and &ldquo;evidence&rdquo; by showing how each of their fundamental indicators has actually been in steady decline since 2008, even in the face of massive monetary intervention and fiat printing by the Fed.</p> <p>My greatest concern leading up to the 2016 election was that Trump would be allowed to win because he represents the perfect scapegoat for an economic crisis that central banks have been brewing for years. Whether or not Trump is aware of this plan cannot yet be proven, but as I have mentioned in the past, his cabinet of Goldman Sachs alumni and neo-con veterans hardly gives me confidence.&nbsp; In the best case scenario, Trump is surrounded by enemies; in the worst case scenario, he is surrounded by friends.</p> <p>Trump&rsquo;s loyalties, though, are a secondary issue for now.&nbsp; The primary focus of this article is to discern whether or not a battle between Trump and the Fed will result in a net positive or a net negative for the public.&nbsp; My position is that any action against the Fed should have happened years ago, and that today, the Fed is nothing more than a sacrificial appendage of a greater globalist agenda.&nbsp; Meaning, conservative groups should be aware that a victory over the Fed is not actually a victory over the globalists.&nbsp; In fact, the globalists may very well WANT a war between the Fed and the White House at this time.</p> <p><strong>First, some facts need to be established to counter the propaganda claims that the Fed is some kind of&nbsp; innocent victim of a rampaging President Trump or &ldquo;misguided&rdquo; conservative rhetoric.</strong></p> <p><span style="text-decoration: underline;"><strong>The Scapegoat Setup Continues</strong></span></p> <p>The latest extension of the Fed&rsquo;s propaganda has been initiated, of course, by the mainstream media and liberals in general; you know, the same people that were applauding the (in some cases misguided) efforts of the Occupy Wall Street movement.&nbsp; With Trump&rsquo;s negation of the Dodd-Frank Act, the media has been looking for any opportunity to assert that Trump is either acting to enrich his corporate friends or that he is an idiot man-child when it comes to matters of business and economics.</p> <p>This led to some sniping by Elizabeth Warren and <span class="example">Federal Reserve Board Chair Janet Yellen</span>&lsquo;s testimony before congress last week.&nbsp; The argument?&nbsp; That Trump was wrong or &ldquo;lying&rdquo; when he said that Dodd-Frank had frozen loans from major banks.&nbsp; You can see the glee in media outlets over the stab; <a href="http://www.vanityfair.com/news/2017/02/janet-yellen-just-fact-shamed-donald-trump" target="_blank">a recent article</a> by Vanity Fair, which seemed to focus more on snide ankle biting of Trump than concrete evidence, is a perfect example.</p> <p>Now, in Trump&rsquo;s defense (or at least, in defense of his position), Yellen is actually the one lying, here.&nbsp; While it is true that commercial lending has expanded, her claim that small business loans have improved is simply false.&nbsp; Even <a href="https://www.bloomberg.com/view/articles/2017-02-03/one-way-for-trump-to-help-small-business"> Bloomberg begrudgingly acknowledges</a> that small business loans have fallen by at least 6% since the passage of Dodd-Frank.&nbsp; In Obama&rsquo;s favorite liberal home-base, Chicago, loans to small neighborhood businesses <a href="http://www.chicagotribune.com/business/columnists/ct-small-business-loans-robert-reed-0205-biz-20170202-column.html">declined by 49%</a> between 2008 and 2014.</p> <p>In 2015, Yellen herself argued that small business loans were in decline because small business owners &ldquo;<a href="http://www.cnbc.com/2015/02/26/small-biz-lending-tktkt-.html" target="_blank">don&rsquo;t want loans anymore.</a>&rdquo;&nbsp;&nbsp; This is a bit like the Bureau of Labor Statistics arguing that over 95 million unemployed working age Americans should not be counted as unemployed in their stats because they really &ldquo;don&rsquo;t want a job.&rdquo;&nbsp; It is an attempt to muddy the waters on the greater issue, which is that the U.S. economy is in considerable danger.</p> <p>You see, I don&rsquo;t think Trump was debating that major corporations and banks were not receiving ample loans, I think he was primarily pointing out the disparity in small business loans and personal loans.&nbsp; Yellen and the mainstream media attempted to use one data point &mdash; commercial loans, to dismiss the entire debate over loan stagnation.</p> <p><u><strong>The Fed Is Culpable For Our Bubble Economy And Trying To Shift Blame Before A Collapse</strong></u></p> <p>The fact is, we all KNOW that major corporations and banks have been flooded with ample loans, and much of this capital was conjured out of thin air by the Fed itself through fiat creation and near zero interest rates.&nbsp; We know this because of the <a href="http://www.reuters.com/article/us-usa-fed-buybacks-analysis-idUSKCN0RN0D320150923" target="_blank">$16 trillion in loans</a> made to companies around the world exposed by the revealing (but limited) TARP audit.&nbsp; We also know this because much of these loans have been used to inflate the stock market bubble for the past few years through <a href="http://blogs.marketwatch.com/thetell/2013/12/18/feds-low-rates-may-be-juicing-stock-buybacks-at-the-expense-of-jobs/" target="_blank">endless stock buybacks</a> that most companies never would have been able to afford otherwise. We also know that the mainstream investment world is aware of the importance of these loans because they started to panic as the Fed announced its ongoing program of interest rate hikes.</p> <p>Beyond that, we know that the Fed&rsquo;s low interest loans and culture of circular inbred lending between corporations and banks have been instrumental in keeping stocks hyperinflated, because Fed officials have<em> </em>OPENLY ADMITTED that this is the case.&nbsp; As Richard Fisher of the Dallas Fed stated in an <a href="http://video.cnbc.com/gallery/?video=3000474362" target="_blank">interview with CNBC</a>:</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><strong>&ldquo;What the Fed did &mdash; and I was part of that group &mdash; is we front-loaded a tremendous market rally, starting in 2009.It&rsquo;s sort of what I call the &ldquo;reverse Whimpy factor&rdquo; &mdash; give me two hamburgers today for one tomorrow. I&rsquo;m not surprised that almost every index you can look at &hellip; was down significantly.&rdquo; [Referring to the results in the stock market after the Fed raised rates in December 2015.]</strong></p> <p>&nbsp;</p> <p><strong>&ldquo;&hellip;I was warning my colleagues, &ldquo;Don&rsquo;t go wobbly if we have a 10-20 percent correction at some point. &hellip; Everybody you talk to &hellip; has been warning that these markets are heavily priced.&rdquo;</strong></p> </blockquote> <p>So, again, the issue is not whether or not banks are lending, we know they are lending, they just aren&rsquo;t lending to the people that need it most.</p> <p>I think Fisher was dishonest in his evaluation of the extent of the consequences of the Fed bubble and that a 10% to 20% drop in equities is an absurd underestimation.&nbsp; But setting aside the &quot;little white lies&quot;, it is at least widely available knowledge that the Federal Reserve initiated a corporate loan free-for-all, knowing that the supposed benefits were limited in scope as well as in duration.&nbsp; They know that a crash is coming, and they have been stalling until they can find the right scapegoat to divert blame.&nbsp; That scapegoat is Trump, and by association, all conservatives.</p> <p>As far as Dodd-Frank is concerned, the act was supposed to be a primer for stopping destructive behavior in the financial sector, more specifically in derivatives.&nbsp; Yet, in spite of Dodd-Frank, banks like Citigroup are STILL <a href="http://wallstreetonparade.com/2016/07/citigroup-has-more-derivatives-than-4701-u-s-banks-combined-after-blowing-itself-up-with-derivatives-in-2008/" target="_blank">bloated with derivatives </a>after receiving at least $476 billion in taxpayer funds to stop them from going bankrupt for the very same irresponsibility.</p> <p>Dodd-Frank accomplished absolutely nothing in terms of what it was mandated to do.&nbsp; I believe the only true purpose of Dodd-Frank was to distract everyone from Ron Paul&rsquo;s Fed audit bill, which was gaining major traction at the time.</p> <p><u><strong>Liberals And The Fed Become Bedfellows? </strong></u></p> <p>So, why does Trump&rsquo;s undercutting of Dodd-Frank even matter?&nbsp; As outlined above, it is a propaganda point for the establishment to perpetuate the narrative that Trump is incompetent, that the people who support him are incompetent, and that when the economy does shift into greater crisis it will be his fault and the fault of conservatives.&nbsp; It is also a springboard for the Federal Reserve to &ldquo;attack&rdquo; Trump, as shown in Yellen&rsquo;s congressional testimony.</p> <p>I also find it interesting that through the Dodd-Frank issue as well as others, leftists are being galvanized in support around the Federal Reserve, something that they probably would not have done a couple of years ago.&nbsp; This is all culminating in what I believe will become a titanic battle not only between Trump and Leftists, but also between Donald Trump and the Fed.&nbsp; But why would the establishment want to incite a conflict between the president and the central bank?</p> <p>This is something conservatives and liberty activists have wanted for decades &mdash; a president that would be willing to take on the Federal Reserve and expose its innards.&nbsp; The problem is, the time for the effectiveness of such an action is long gone.&nbsp; Auditing the Fed under Obama (an openly pro-globalist president) would have been a disaster for the powers that be.&nbsp; It would have thrown their entire agenda into disarray and killed any chance that they could complete what they call the &ldquo;great global economic reset.&rdquo;&nbsp; Auditing or shutting down the Fed under Trump is another matter.</p> <p>As I examined in detail with evidence in my article<a href="http://www.alt-market.com/articles/2403-the-economic-end-game-explained"> &#39;The Economic End Game Explained&#39;</a>, the Federal Reserve has a shelf life.&nbsp; It has already served its purpose, which was to undermine the American economy and our currency system.&nbsp; The Fed will now begin deflating the bubbles it has engineered in stocks, Treasuries and the dollar through continued interest rate hikes and rolling out the over $4 trillion (official amount) on its balance sheet.&nbsp; The goal?&nbsp; Sinking America and reducing it to third world status over the course of the next several years to make way for total global centralization of economic administration, eventually leading to global fiscal management under the IMF and perhaps the BIS, and a global currency system; all while making conservative movements look like the monster behind the crisis.</p> <p><strong>To summarize, the U.S. economy and the dollar are slated for a controlled demolition.&nbsp;</strong> The Fed will do everything in its power to prod Trump and conservatives into war with the central bank, because the Fed is now ready to sacrifice itself and the dollar&rsquo;s world reserve status in order to clear a path for a new global system and ideology. <strong>The Federal Reserve is a suicide bomber.</strong></p> <p>If this takes place as I predict then the international banks and the establishment elites will be able to lay the blame for the death of king dollar squarely at the feet of Trump and conservatives, and at least a third of the country (leftists) will buy into the narrative lock, stock and barrel because they desperately WANT to believe it.&nbsp; Remember, the tale being scripted here is that Trump is a rampaging maniac that does not know what he is doing.</p> <p><strong>To be clear, I am not supporting the continuing dominance of the Fed, or the existence of the fiat dollar.&nbsp; What I am saying is that conservatives may just get what we have been wishing for all these years but not in the manner we had hoped.</strong></p> <p>To counter this threat our list of targets must expand to meet reality.&nbsp; The delusion that the core problem is the Federal Reserve must stop.&nbsp; The Fed is a box store, a franchise in a chain of franchises, nothing more.&nbsp; If we do not also turn our scrutiny and aggression towards root globalist institutions like the IMF and the BIS as well as international banks, then our efforts will only serve to bolster the enemy we are trying to fight.</p> <p>In a battle limited to Trump versus the Fed, <strong>only the bankers will win.</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="478" height="287" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170223_alt.jpg?1487860971" /> </div> </div> </div> http://www.zerohedge.com/news/2017-02-23/battle-between-trump-and-federal-reserve-who-really-wins#comments BIS BIS Bureau of Labor Statistics Bureau of Labor Statistics Business Business Central Banks Citigroup Climate change skepticism and denial Dallas Fed Dallas Fed Dodd–Frank Wall Street Reform and Consumer Protection Act Donald Trump Donald Trump Economy Elizabeth Warren fed Federal Reserve Federal Reserve Board Federal Reserve System Finance Financial crisis of 2007–2008 Fisher goldman sachs Goldman Sachs Great Recession in the United States International Monetary Fund Janet Yellen Janet Yellen Obama Administration Obama administration Presidency of Barack Obama Reality recovery Richard Fisher Ron Paul Subprime mortgage crisis Systemic risk TARP Testimony Trump Administration US Federal Reserve White House White House Fri, 24 Feb 2017 04:20:00 +0000 Tyler Durden 588822 at http://www.zerohedge.com The $74 Trillion Global Economy In One Chart http://www.zerohedge.com/news/2017-02-23/74-trillion-global-economy-one-chart <p>The latest GDP numbers from the <a href="http://data.worldbank.org/data-catalog/GDP-ranking-table">World Bank</a> were released earlier this month, and today&rsquo;s visualization from <a href="https://howmuch.net/articles/the-global-economy-by-GDP">HowMuch.net</a> breaks them down to show the<strong> relative share of the global economy for each country. </strong></p> <p><a href="http://www.visualcapitalist.com/74-trillion-global-economy-one-chart/"><em>As Visual Capitalist&#39;s Jeff Desjardins explains,</em></a> the full circle, known as a Voronoi Diagram, <strong>represents the entirety of the $74 trillion global economy in nominal terms.</strong> Meanwhile, each country&rsquo;s segment is sized accordingly to their percentage of global GDP output. Continents are also grouped together and sorted by color.</p> <div style="clear:both"><a href="http://www.visualcapitalist.com/74-trillion-global-economy-one-chart/"><img src="http://2oqz471sa19h3vbwa53m33yj.wpengine.netdna-cdn.com/wp-content/uploads/2017/02/global-economy-one-chart.png" style="border-width: 0px; border-style: solid; height: 515px; width: 601px;" /></a></div> <div><em>Courtesy of: <a href="http://www.visualcapitalist.com">Visual Capitalist</a></em></div> <p>&nbsp;</p> <p>Here is the data for the Top 20 Countries in table form:</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/02/19/20170223_gdp.jpg"><img height="731" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/02/19/20170223_gdp_0.jpg" width="600" /></a></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="1071" height="914" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170223_gdp1.jpg?1487861393" /> </div> </div> </div> http://www.zerohedge.com/news/2017-02-23/74-trillion-global-economy-one-chart#comments Academia Business Capitalism Computational geometry Diagrams Discrete geometry Economics Economy Global Economy Gross domestic product National accounts Visual Capitalist Voronoi Voronoi diagram World Bank World Bank World economy Fri, 24 Feb 2017 03:55:00 +0000 Tyler Durden 588827 at http://www.zerohedge.com Calexit - Beat The Crowd http://www.zerohedge.com/news/2017-02-23/calexit-beat-crowd <p><a href="http://milleronthemoney.com/calexit-beat-crowd/"><em>Submitted by Dennis Miller via MillerOnTheMoney.com,</em></a></p> <p><em><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/02/19/20170223_calexit.jpg"><img height="188" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/02/19/20170223_calexit.jpg" width="300" /></a></em></p> <p><strong>Our country has become bitterly divided.</strong> No matter who won the election, I predicted we would soon be reading about states wanting to secede from the union.</p> <p>Even before President Trump was sworn in, the California movement, known as Calexit, began. The first step is to ask voters to adopt a state Constitutional Amendment revoking the U. S. Constitution as the supreme law.</p> <p><a href="http://www.yescalifornia.org" target="_blank">YesCalifornia.org</a> makes this appeal:</p> <p style="padding-left: 30px;">&ldquo;As the sixth largest economy in the world, California is more economically powerful than France and has a population larger than Poland. Point by point, California compares and competes with countries, not just the 49 other states.</p> <p style="padding-left: 30px;">Since 1987, California has been subsidizing the other states at a loss of tens and sometimes hundreds of billions of dollars in a single fiscal year.</p> <p style="padding-left: 30px;">&hellip;In our view, the United States of America represents so many things that conflict with Californian values, and our continued statehood means California will continue subsidizing the other states to our own detriment, and to the detriment of our children.&rdquo;</p> <p>They outline reasons why citizens should vote for secession. Point 9 is a bit different, &ldquo;California has some of the best universities but in various ways, our schools are among the worst in the country.&rdquo;</p> <p>I&rsquo;m unable to determine if the claim &ldquo;hundreds of billions of dollars&rdquo; is accurate. How is it calculated? Is a post office or military base returning money back to the state? <a href="https://www.creditloan.com/blog/united-states-federal-tax-dollars/" target="_blank">Creditloan.com</a> indicates California receives $.78 back for every $1.00 is sends to the federal government. Maybe they have a point.</p> <p><span style="text-decoration: underline;"><strong><em>Different values causes divorce</em></strong></span></p> <p>Our founding fathers felt the values of the King of England conflicted with the values of the colonies. Many Americans cheered the British on when they opted out of the European Union. For both situations, oppressive taxation, different values and cost and control of the central government was a motivating factor.</p> <p><span style="text-decoration: underline;"><strong><em>Be careful what you wish for</em></strong></span></p> <p>Things are not all sunny in the land of milk and honey. Currently the California Public Employees&rsquo; Retirement System (CalPERS) is woefully underfunded. The Mercury News editorial, <a href="http://www.mercurynews.com/2016/12/22/editorial-calpers-again-falls-short-of-addressing-deficit/" target="_blank">&ldquo;CalPERS again falls short of addressing deficit&rdquo;</a> reports the fund has lowered the projected earnings estimates from 7.5% down to 7% in 2019. They add one inconvenient truth:</p> <p style="padding-left: 30px;">&ldquo;To understand how far short this move falls, consider that CalPERS announced Wednesday that it hadn&rsquo;t hit a 7 percent average over the last 20 years and, going forward, it estimates that there&rsquo;s only roughly a 1-in-4 chance that it will meet that target.</p> <p style="padding-left: 30px;">&hellip; CalPERS consultant warns that the pension system should anticipate only an average 6.2 percent in each of the next 10 years.</p> <p style="padding-left: 30px;">&hellip; That places the system&rsquo;s shortfall at about $170 billion, which averages more than $13,000 of debt for each California household.&rdquo;</p> <p>The optimistic vision of the secessionist movement overlook a major factor. The California political class is predominantly socialists, redistributing wealth through progressive taxation and free programs to voters to maintain their power. If secession brings an economic windfall it would quickly be spent. As Margaret Thatcher warned,<em><strong> &ldquo;The problem with socialism is you run out of other people&rsquo;s money.&rdquo;</strong></em></p> <p><span style="text-decoration: underline;"><strong><em>Beat the Crowd</em></strong></span></p> <p><strong>George Bernard Shaw said, &ldquo;A government that robs Peter to pay Paul can always depend on the support of Paul.&rdquo; In many cases Peter quietly moved away and took his money with him.</strong></p> <p>Remember when top professional golfer, Phil Michelson created quite a stir complaining about California taxes, while putting his home up for sale? He would have been better off staying quiet about his reasons. <a href="http://www.capoliticalreview.com/capoliticalnewsandviews/is-phil-mickelson-finally-abandoning-california-for-income-tax-free-florida/" target="_blank">California Political Review</a> reports:</p> <p style="padding-left: 30px;">&ldquo;Tiger Woods moved from Orange County, California to Orange County, Florida. In the first year of that move, he saved $13 million in taxes. Is it worth $13 million a year taken by government to live in California? Woods said no. Now it looks like Phil Michelson is about to make the same decision. He earns $60 million a year-he would save north of $5 million a year to move to a free State, like Florida or Texas.&rdquo;</p> <p>The <a href="http://nypost.com/2016/04/10/this-man-could-destroy-new-jersey-by-moving-to-florida/" target="_blank">New York Post</a> reports:</p> <p style="padding-left: 30px;">&ldquo;Billionaire David Tepper has moved from New Jersey to Florida, and the loss of his income tax could leave a $140 million hole. &hellip; Forty percent of the state&rsquo;s revenue comes from personal-income tax &ndash; a third of which is collected from less than 1 percent of taxpayers. Tepper was New Jersey&rsquo;s wealthiest resident.&rdquo;</p> <p><u><strong><em>It&rsquo;s not just the heavy hitters</em></strong></u></p> <p>When we moved to Phoenix we joined a local club in order to meet people. Each month new members stand up and introduce themselves. We noticed a large number of Californians. While my survey is unscientific, I&rsquo;ve asked many why they moved. Every one mentioned how expensive California is to live. One former Californian remarked,<strong> &ldquo;There are a lot of California refugees in Arizona and Nevada.&rdquo;</strong></p> <p>We lived in Georgia when they passed a state income tax. While it&rsquo;s progressive, the top rate (6%) kicks in at $7,000. At the time I was in my peak earning years and could live anywhere.</p> <p>I was an early immigrant. The first time I paid GA income tax, I realized our other taxes did not go down. What did I get back from the government for confiscating an additional 6% of my earnings? We quickly moved to Florida, with no state income taxes. Florida is full of refugees fleeing other high tax states.</p> <p>The migration continues. In 2013 the <a href="https://taxfoundation.org/monday-map-migration-personal-income" target="_blank">Tax Foundation</a> published a State Migration Calculator and great graphic:</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/02/19/20170222_calexit.png"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/02/19/20170222_calexit_0.png" style="width: 600px; height: 477px;" /></a></p> <p>The high tax socialist states are losing billions in adjusted gross income, while states like Texas and Florida are growing. <a href="http://www.washingtonexaminer.com/states-with-right-to-work-laws-and-no-income-taxes-grew-fastest-in-the-obama-years/article/2611150" target="_blank">The Washington Examiner</a> reports the trend is continuing and concludes, &ldquo;The growth in no-income-tax and right-to-work states was fueled largely by <strong><em>net domestic migration rather than international migration</em></strong> (Emphasis mine), according to the 2016 Census estimates.&rdquo;</p> <p><u><strong><em>The landscape is changing</em></strong></u></p> <p>The election of President Trump sent shock waves through much of the political class. Many public union pensions are woefully underfunded. <strong>They donated millions to Hillary Clinton&rsquo;s election campaign and expected federal bailouts. They knew they could count on Mrs. Clinton; she has a great track record of rewarding her political donors. Today no one knows what the new administration will do.</strong></p> <p>In the meantime, the scramble is on. <strong>The politicians in states that have been heavily supporting Paul have a huge base, not because they have won over the hearts and minds of Peter; but rather because the working class got tired of being fleeced and left. The politicos have to find ways to make good on all their free programs. Cutting benefits will cause citizens to storm the palace. They must find ways to generate more revenue.</strong></p> <p>Brian Daniels warns us, <a href="https://www.ezlandlordforms.com/articles/news/360/the-growing-specter-of-state-exit-taxes-as-residents-abandon-high-tax-states/" target="_blank">The Growing Specter of State &ldquo;Exit Taxes&rdquo; as Residents Abandon High-Tax States</a>:</p> <p style="padding-left: 30px;">&ldquo;To be clear, it is not legal for states to charge a true exit tax on citizens changing their residency from one state to another (this is not the case for the federal government, which does charge a large exit tax).</p> <p style="padding-left: 30px;">So what do high-tax states do to try and prevent their residents from moving their legal residence to low- or no-tax states? In a word, they audit them.&rdquo;</p> <p>When a taxpayer is audited, the agency issues an assessment for unpaid taxes. It&rsquo;s not &ldquo;innocent until proven guilty.&rdquo; You must prove they are wrong or the assessment stands.</p> <p>Once you intend to leave you are of no value to the politicos. Most people do not have the means to go to court. For some, it becomes a government shakedown to extract as much wealth as they can on your way out the door.</p> <p><u><strong><em>What about Calexit?</em></strong></u></p> <p><em><strong>With the mindset of California voters, who knows what will happen?</strong></em></p> <p>I don&rsquo;t recommend holding any California government debt, including holdings in bond funds. While the probability of secession may be small, might they establish their own currency and try to renegotiate their debt? Holding California debt is an unnecessary risk to take with retirement money.</p> <p>Should they vote to secede, Californians would face a choice of leaving or staying. <strong>If you choose to leave, expect a hefty exit tax. </strong>If you are thinking about leaving, why wait? Walk quietly and beat the rush!</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="300" height="188" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170223_calexit.jpg?1487888249" /> </div> </div> </div> http://www.zerohedge.com/news/2017-02-23/calexit-beat-crowd#comments Bond California government CalPERS Economy European Union European Union federal government Florida France Income tax in the United States Internal Revenue Service New York Post Poland Politics Post Office Progressive tax Public economics Public finance Social Issues State income tax Tax Tax Foundation Taxation in the United States Fri, 24 Feb 2017 03:30:00 +0000 Tyler Durden 588864 at http://www.zerohedge.com