Poured your info out on a call to 118 118 Money? Bad luck. Credit provider 'fesses up that hacker nabbed customer service phone recordings

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Don't worry, though. Any 'systematic' data extraction would be 'time-consuming'

The digital burglary at 118 118 Money exposed recordings of customer service calls that included a raft of personal information although thankfully not payment data.…


If there's something strange in Symantec's neighborhood, who you gonna call? Not Broadcom, it seems: Systems go down, cut off customers

logicfish Security theres something strange symantecs neighborhood gonna call broadcom seems systems down customers All https://go.theregister.co.uk   Discuss    Share
And now back on their feet after global two-hour wobble

Symantec customers, or rather Broadcom customers these days, were taken offline for a while on Wednesday when the security service's data centers around the planet went down.…


Margin Call: You Were Warned Of The Risk

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Margin Call: You Were Warned Of The Risk

Authored by Lance Roberts via RealInvestmentAdvice.com,

I have been slammed with emails over the last couple of days asking the following questions:

“What just happened to my bonds?”

“What happened to my gold position, shouldn’t it be going up?”

“Why are all my stocks being flushed at

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the same time?”

As noted by Zerohedge:

“Stocks down, Bonds down, credit down, gold down, oil down, copper down, crypto down, global systemically important banks down, and liquidity down

Today was the worst day for a combined equity/bond portfolio… ever…”

This Is What A “Margin Call,” Looks Like.

In December 2008, we warned of the risk. At that time, the market was dropping sharply, and Mark Hulbert wrote an article dismissing the risk of margin debt. To wit:

“Plunging margin debt may not doom the bull market after all, reports to the contrary notwithstanding.

According to research conducted in the 1970s by Norman Fosback, then the president of the Institute for Econometric Research, there is an 85% probability that a bull market is in progress when margin debt is above its 12-month moving average, in contrast to just a 41% probability when it’s below.

Why, then, do I suggest not becoming overly pessimistic? For several reasons:

1) The margin debt indicator issues many false signals

2) There is insufficient data

3) Margin debt is a strong coincident indicator.”

I disagreed with Mark on several points at the time. But fortunately the Federal Reserve’s reversal on monetary policy kept the stock market from sinking to levels that would trigger “margin calls.”

As I noted then, margin debt is not a technical indicator that can be used to trade markets. Margin debt is the “gasoline,” which drives markets higher as the leverage provides for the additional purchasing power of assets. However, that “leverage” also works in reverse as it provides the accelerant for larger declines as lenders “force” the sale of assets to cover credit lines without regard to the borrower’s position.

That last sentence is the most important and is what is currently happening in the market.

The issue with margin debt, in terms of the biggest risk, is the unwinding of leverage is NOT at the investor’s discretion.

It is at the discretion of the broker-dealers that extended that leverage in the first place. (In other words, if you don’t sell to cover, the broker-dealer will do it for you.) 

When lenders fear they may not be able to recoup their credit-lines, they force the borrower to either put in more cash or sell assets to cover the debt. The problem is that “margin calls” generally happen all at once as falling asset prices impact all lenders simultaneously.

Margin debt is NOT an issue – until it is.

When an “event” occurs that causes lenders to “panic” and call in margin loans, things progress very quickly as the “math” becomes a problem. Here is a simple example.

“If you buy $100,000 of stock on margin, you only need to pay $50,000. Seems like a great deal, especially if the stock price goes up. But what if your stock drops to $60,000? Suddenly, you’ve lost $40,000, leaving you with only $10,000 in your margin account. The rules state that you need to have at least 25 percent of the $60,000 stock value in your account, which is $15,000. So not only do you lose $40,000, but you have to deposit an additional $5,000 in your margin account to stay in business.

However, when margin calls occur, and equity is sold to meet the call, the equity in the portfolio is reduced further. Any subsequent price decline requires additional coverage leading to a “death spiral” until the margin line is covered.


  • $100,000 portfolio declines to $60,000. Requiring a margin call of $5000.

  • You have to deposit $5000, or sell to cover. 

  • However, if you don’t have the cash, then a problem arises. The sell of equity reduces the collateral requirement requiring a larger transaction: $5000/.25% requirement = $20,000

  • With the margin requirement met, a balance of $40,000 remains in the account with a $10,000 margin requirement. 

  • The next morning, the market declines again, triggering another margin call. 

  • Wash, rinse, repeat until broke.

This is why you should NEVER invest on margin unless you always have the cash to cover.

Just 20% 

As I discussed previously, the level we suspected would trigger a margin event was roughly a 20% decline from the peak.

“If such a decline triggers a 20% fall from the peak, which is around 2340 currently, broker-dealers are likely going to start tightening up margin requirements and requiring coverage of outstanding margin lines.

This is just a guess…it could be at any point at which “credit-risk” becomes a concern. The important point is that ‘when’ it occurs, it will start a ‘liquidation cycle’ as ‘margin calls’ trigger more selling which leads to more margin calls. This cycle will continue until the liquidation process is complete.

The Dow Jones provided the clearest picture of the acceleration in selling as “margin calls” kicked in.

The last time we saw such an event was in 2008.

How Much More Is There To Go?

Unfortunately, FINRA only updates margin debt with about a 2-month lag.

Mark’s second point was a lack of data. This isn’t actually the case as margin debt has been tracked back to 1959. However, for clarity, let’s just start with data back to 1980. The chart below tracks two things:

  1. The actual level of margin debt, and;

  2. The level of “free cash” balances which is the difference between cash and borrowed funds (net cash).

As I stated above, since the data has not been updated since January, the current level of margin, and negative cash balances, has obviously been reduced, and likely sharply so.

However, previous “market bottoms,” have occurred when those negative cash balances are reverted. Given the extreme magnitude of the leverage that was outstanding, I highly suspect the “reversion” is yet complete. 

The relationship between cash balances and the market is better illustrated in the next chart. I have inverted free cash balances, to show the relationship between reversals in margin debt and the market. Given the market has only declined by roughly 30% to date, there is likely more to go. This doesn’t mean a fairly sharp reflexive bounce can’t occur before a further liquidation ensues.

If we invert margin debt to the S&P 500, you can see the magnitude of both previous market declines and margin liquidation cycles. As stated, this data is as of January, and margin balances will be substantially lower following the recent rout. I am just not sure we have “squeezed” the last bit of blood out of investors just yet. 

You Were Warned

I warned previously, the idea that margin debt levels are simply a function of market activity, and have no bearing on the outcome of the market, was heavily flawed.

“By itself, margin debt is inert.

Investors can leverage their existing portfolios and increase buying power to participate in rising markets. While ‘this time could certainly be different,’ the reality is that leverage of this magnitude is ‘gasoline waiting on a match.’

When an event eventually occurs, it creates a rush to liquidate holdings. The subsequent decline in prices eventually reaches a point that triggers an initial round of margin calls. Since margin debt is a function of the value of the underlying ‘collateral,’ the forced sale of assets will reduce the value of the collateral, triggering further margin calls. Those margin calls will trigger more selling, forcing more margin calls, so forth and so on.

That event was the double-whammy of collapsing oil prices and the economic shutdown in response to the coronavirus.

While it is certainly hoped by many that we are closer to the end of the liquidation cycle, than the beginning, the dollar funding crisis, a blowout in debt yields, and forced selling of assets, suggests there is likely more pain to come before we are done.

It’s not too late to take actions to preserve capital now, so you have capital to invest later.

As I wrote in Tuesday’s missive “When Too Little Is Too Much:”

“With our risk limits hit, and in order to protect our clients from both financial and emotional duress, we made the decision that even the reduced risk we were carrying was still too much.

The good news is that a great ‘buying’ opportunity is coming. Just don’t be in a ‘rush’ to try and buy the bottom. 

I can assure you, when we ultimately see a clear ‘risk/reward’ set up to start taking on equity risk again, we will do so ‘with both hands.’ 

And we are sitting on a lot of cash just for that reason.”

You can’t “buy low,” if you don’t have anything to “buy with.”

Tyler Durden

Thu, 03/19/2020 - 12:00

Here Comes Bazooka #2: ECB Is Holding An Emergency Call

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Here Comes Bazooka #2: ECB Is Holding An Emergency Call

Bazooka #1 was an epic dud. Here comes Bazooka #2.

According to Bloomberg, the ECB has been officially called into action to save the day following a day of unprecedented risk losses and when the Dollar went all "Volkswagen" as the BBDXY hit a record high, and is currently holding an emergency meeting just moments after France’s finance minister urged the central bank to intervene quickly a

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nd massively.

The imminent emergency announcement comes shortly after reports that the EU is preparing a rescue fund, or as Bloomberg's Andrew Cinko in-house permabull puts it, "the dam may be breaking on truly pulling out all the stops in order to stem the bleeding."

It sure is Andrew, but woe to the bulls if Bazooka #2 also turns out to be a water pistol, because there won't be a third attempt.

Tyler Durden

Wed, 03/18/2020 - 16:02

Philippines sends all workers home, outsourced call centres for Acer and telcos suffer degraded service

logicfish Business philippines sends workers home outsourced call centres acer telcos suffer degraded service All https://go.theregister.co.uk   Discuss    Share
We get the lowdown on the lockdown from a BPO operator in the heart of Manila

The government of the Philippines has introduced “enhanced community quarantine” rules that restrict movement and have therefore depleted the ranks of workers in the nation’s flotilla of contact centres. One result is customer service degradation in other countries.…


"Half Of America Will Get Sick": Here Is What Goldman Told 1,500 Clients In Its Emergency Sunday Conference Call

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"Half Of America Will Get Sick": Here Is What Goldman Told 1,500 Clients In Its Emergency Sunday Conference Call

Around the time the Fed stunned markets with its 5pm Sunday emergency bazooka intervention, Goldman was holding an emergency conference call in which some 1,500 clients and companies dialed-in, making the comparisons to "Lehman Sunday" especially apropos.

For those wondering what Goldman said, here is the bottom lin

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e via TME:

  • 50% of Americans will contract the virus (150m people) as it's very communicable. This is on a par with the common cold (Rhinovirus) of which there are about 200 strains and which the majority of Americans will get 2-4 per year.

  • 70% of Germany will contract it (58M people). This is the next most relevant industrial economy to be effected.

  • Peak-virus is expected over the next eight weeks, declining thereafter.

  • The virus appears to be concentrated in a band between 30-50 degrees north latitude, meaning that like the common cold and flu, it prefers cold weather. The coming summer in the northern hemisphere should help. This is to say that the virus is likely seasonal.

  • Of those impacted 80% will be early-stage, 15% mid-stage and 5% critical-stage. Early-stage symptoms are like the common cold and mid-stage symptoms are like the flu; these are stay at home for two weeks and rest. 5% will be critical and highly weighted towards the elderly.

  • Mortality rate on average of up to 2%, heavily weight towards the elderly and immunocompromised; meaning up to 3m people (150m*.02). In the US about 3m/yr die mostly due to old age and disease, those two being highly correlated (as a percent very few from accidents). There will be significant overlap, so this does not mean 3m new deaths from the virus, it means elderly people dying sooner due to respiratory issues. This may however stress the healthcare system.

  • There is a debate as to how to address the virus pre-vaccine. The US is tending towards quarantine. The UK is tending towards allowing it to spread so that the population can develop a natural immunity. Quarantine is likely to be ineffective and result in significant economic damage but will slow the rate of transmission giving the healthcare system more time to deal with the case load.

  • China’s economy has been largely impacted which has affected raw materials and the global supply chain. It may take up to six months for it to recover.

  • Global GDP growth rate will be the lowest in 30 years at around 2%.

  • S&P 500 will see a negative growth rate of -15% to -20% for 2020 overall.

  • There will be economic damage from the virus itself, but the real damage is driven mostly by market psychology. Viruses have been with us forever. Stock markets should fully recover in the 2nd half of the year.

  • In the past week there has been a conflating of the impact of the virus with the developing oil price war between KSA and Russia. While reduced energy prices are generally good for industrial economies, the US is now a large energy exporter, so there has been a negative impact on the valuation of the domestic energy sector. This will continue for some time as the Russians are attempting to economically squeeze the American shale producers and the Saudi’s are caught in the middle and do not want to further cede market share to Russia or the US.

  • Technically the market generally has been looking for a reason to reset after the longest bull market in history.

  • There is NO systemic risk. No one is even talking about that. Governments are intervening in the markets to stabilize them, and the private banking sector is very well capitalized. It feels more like ‪9/11 than it does like 2008.

Tyler Durden

Tue, 03/17/2020 - 04:44

The World Is Hit With A $12 Trillion Dollar Margin Call

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The World Is Hit With A $12 Trillion Dollar Margin Call

Earlier today Trump declared that Sunday would be a national day of prayer.

With Americans having far bigger concerns on their minds, we doubt

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many will have time for prayer today, although there is one person who certain could do with some divine assistance: Fed chair Jerome Powell.

And there is a specific reason for that... or rather 12 trillion reasons.

But first, let's back up to a post we write back in October 2009 explaining how the Fed's emergency response during the financial crisis - which included credit facilities backed by corporate bonds and even stocks, all the way to unlimited FX swap lines with foreign central banks - was first and foremost in response to a massive dollar margin call that resulted in the aftermath of the Lehman and AIG collapse as conventional cross-border funding pathways froze up, forcing the Fed to step in and flood the world with dollars to avoid a catastrophic surge in the dollar as the entire world scrambled to obtain the world's reserve currency.

Back then the BIS published a paper titled "The US dollar shortage in global banking and the international policy response" which explained how then-Fed Chair Ben Bernanke in essence bailed out the entire developed world, which was facing an unprecedented dollar shortage crisis due to the sudden deflationary shockwave unleashed by the financial crisis, which also ground the global economy, and conventional dollar funding pathways to a halt while heightened counterparty risk after Lehman's collapse and liquidity concerns compromised short-term interbank funding, resulting in a lock of shadow banking conduits and money market funds "breaking the buck." In short: an unprecedented crisis as a result of a global dollar margin call. 

This is how the BIS quantified the peak dollar shortage at the heights of the financial crisis:

... European banks’ US dollar investments in nonbanks were subject to considerable funding risk at the onset of the crisis. The net US dollar book, aggregated across the major European banking systems, is portrayed in Figure 5 (bottom left panel), with the non-bank component tracked by the green line. By this measure, the major European banks’ US dollar funding gap had reached $1.0–1.2 trillion by mid-2007. Until the onset of the crisis, European banks had met this need by tapping the interbank market ($432 billion) and by borrowing from central banks ($386 billion), and used FX swaps ($315 billion) to convert (primarily) domestic currency funding into dollars. If we assume that these banks’ liabilities to money market funds (roughly $1 trillion, Baba et al (2009)) are also short-term liabilities, then the estimate of their US dollar funding gap in mid-2007 would be $2.0–2.2 trillion. Were all liabilities to non-banks treated as short-term funding, the upper-bound estimate would be $6.5 trillion (Figure 5, bottom right panel).

Had the Fed not stepped in with a barrage of liquidity-providing instruments and facilities, the rest of the world would have simply collapsed as the $6.5 trillion dollar funding gap closed in on itself, causing an indiscriminate sell off of all dollar denominated assets. It also triggered the first ever launch of virtually unlimited dollar swap lines between the Fed and all other central banks:

The severity of the US dollar shortage among banks outside the United States called for an international policy response. While European central banks adopted measures to alleviate banks’ funding pressures in their domestic currencies, they could not provide sufficient US dollar liquidity. Thus they entered into temporary reciprocal currency arrangements (swap lines) with the Federal Reserve in order to channel US dollars to banks in their respective jurisdictions (Figure 7). Swap lines with the ECB and the Swiss National Bank were announced as early as December 2007. Following the failure of Lehman Brothers in September 2008, however, the existing swap lines were doubled in size, and new lines were arranged with the Bank of Canada, the Bank of England and the Bank of Japan, bringing the swap lines total to $247 billion. As the funding disruptions spread to banks around the world, swap arrangements were extended across continents to central banks in Australia and New Zealand, Scandinavia, and several countries in Asia and Latin America, forming a global network (Figure 7). Various central banks also entered regional swap arrangements to distribute their respective currencies across borders.

The newly created swap lines which served as a "letter of credit" underwritten by the entity that prints the US currency...

... soared in usage in the early days of the financial crisis, and were critical to contain a far greater liquidation cascade.

Why do we bring all this ancient history up? For two reasons.

First, it may come as a shock to some but ever since the financial crisis nothing has been actually fixed, and instead the Fed stepped in at every market stress event to inject more liquidity, aiding the issuance of even more debt, and kicking the can while while helping mask the symptoms of the crisis, only made the underlying financial instability even more acute. Meanwhile conventional wisdom that the US banking system was rendered more stable now are dead wrong, with the public and countless financial professionals fooled by the nearly two trillion in excess reserves (we all saw what happened when this number dropped to a precarious "low" of "only" $1.3 trillion in September of 2019) injected by the Fed in recent years. All this liquidity upon liquidity has only made the system that much more reliant on the Fed's constant bailouts and liquidity injections.

Ssecond, as the events of last week so ominously demonstrated, the dollar shortage is back with a vengeance, as confirmed by last week's concurrent surge in both the Bloomberg Dollar index and the FRA/OIS spread, a closely followed indicator of interbank dollar funding availability.

Indeed, as of Friday, and following a rollout of various "bazooka" interventions by the Fed including a massive $5 trillion repo facility and the launch of QE5, as well as an emergency six POMO operations on Friday to unlock the freezing Treasury market which failed to boost risk sentiment, the FRA/OIS not only failed to respond but surged to the highest level since the financial crisis.

At the same time cross-currency basis swaps - especially for Japan - are screaming dollar shortage...

... which is not worse only thanks to the trillions in excess dollars already sloshing in the system as well as last week's emergency liquidity injections which boosted the Fed's balance sheet by over $200 billion in just a few days in the form of expanded repos and quantitative easing.

And yet - as the market's response to the Fed's bazooka announcement demonstrated - it does not appear to be enough.


Because, and going back to the original topic of a massive dollar margin call, there is now - in JPMorgan's calculations - a global dollar short that has doubled since the financial crisis and was $12 trillion as of this moment, some 60% of US GDP.

So what can the Fed do? For one possible answer we go to Zoltan Pozsar who last week laid out precisely why the coronavirus pandemic (and subsequent oil crisis) would led to a historic run on the dollar (as he so aptly put it "the supply chains is a payment chain in reverse... and so an abrupt halt in production can quickly lead to missed payments elsewhere"), and concluded that to offset the dollar scramble, the Fed would need to "combine rate cuts with open liquidity lines that include a pledge to use the swap lines, an uncapped repo facility and QE if necessary."

So far the Fed has already launched stealth QE, which will likely transform into an official, full-blown QE5 this week when the FOMC meets, and all that's missing are swap lines and an uncapped standing repo facility, both of which cross beyond the purely monetary realm and have political implications. Whether those are also announced today will depend on if the Fed will pursue another intermediate step first, in the form of a Commercial Paper facility, which Bank of America believes will be unveiled in just a few hours.

Tyler Durden

Sun, 03/15/2020 - 13:54

Black Thursday: "One Giant Margin Call" Drags Dow Down 10%

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Black Thursday: "One Giant Margin Call" Drags Dow Down 10%

Rosenberg Research's David Rosenberg provides our intro today:

"The fact that Treasuries, munis, and gold are getting hit tells me that everything is for sale right now. One giant margin call where even the safe-havens aren't safe anymore. Except for cash."

The  Fed unveiled an unprecedented liquidity facilit

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y to rescue malfunction Treasury markets from themselves.. but it failed terribly.

For a few brief moments, as Dow futs exploded 1500 points higher, it looked like it might just work... but no...

Stocks puked into the close! Look at Small Caps!!! The Dow was down 10%! This was utter carnage today...

This was the biggest daily drop since 1987

As one veteran trader said:

"this is the market telling The Fed it has to buy stocks."

This is what it looks like when what shred of Fed liquidity that was left finally evaporates...

Investors are at the most-extreme fear level on record...

And as far as The Fed 'solving' the liquidity or dollar shortage issues... it utterly failed!

Source: Bloomberg

Trannies and Small Caps are now underwater since Trump was elected...

Source: Bloomberg

The ongoing liquidation of one or many risk-parity funds, as we noted earlier...

...appears to be continuing with bonds and stocks both getting dumped as the funds are delevered.

Source: Bloomberg

And the bond-stock correlation has collapsed...

Source: Bloomberg

The S&P remains above the Dec 2018 lows for now, buit blew through the 200-week average that been notable support...

Source: Bloomberg

Europe was a bloodbath:





Source: Bloomberg

Virus-related stocks crashed... again...

Source: Bloomberg

Banks were blitzed...

Source: Bloomberg

VIX exploded higher - to its highest close since Oct 22, 2008...but this time the velocity is far faster

The VIX term structure is almost as inverted as it was at the peak of the Lehman crisis...

HY Credit was hammered...

Source: Bloomberg

HY Energy credit markets are getting destroyed...

Source: Bloomberg

Investment grade credit is also really ugly - not just the level but the velocity is unprecedented...

Source: Bloomberg

The chaos in Treasury markets - which The Fed hoped to fix with its $4 trillion bazooka - remain as liquidity evaporated again and yields soared into the close, despite equity ugliness...

Source: Bloomberg

A mixed picture across the term structure today with the short-end bid and the long-end dumped (3Y -6bps, 30Y +8bbps)...

And once again, yields were puked higher after the 1430 margin call...

Source: Bloomberg

The dollar accelerated higher again today as everything else was sold to grab cash (but did drop on The Fed's actions)...

Source: Bloomberg

Crypto was clubbed like a baby seal across the board...

Source: Bloomberg

Bitcoin puked to below $6000 intraday, blowing through all it skey technicals...

Source: Bloomberg

Commodities were all smashed today...

Source: Bloomberg

WTI was hit hard today, plunging over 5% and trading as low as $30.02 intraday...

Gold was smashed lower today on massive volume as it seems the "liquidate eveything" plan is in play...

Finally,  it is notable that this is the first systemic crisis since the European collapse...

Source: Bloomberg

And in case you thought the 'fortress balance sheet' banks were going to save the world... the world's most systemically important banks crashed to record lows today...

Source: Bloomberg

The market is demanding almost 100bps of rate-cuts by The Fed by next week...

Source: Bloomberg

The deer are back!

And if none of that worries you - this might. USA's sovereign credit risk is rising notably...

Makes you wonder...

Tyler Durden

Thu, 03/12/2020 - 16:01

February Heavy Duty Truck Orders Plunge, New 2020 Estimates Call For A 31% Drop

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February Heavy Duty Truck Orders Plunge, New 2020 Estimates Call For A 31% Drop



It has been an interesting dance over the last 18 months for the Class 8 trucking industry and its analysts. While the numbers have consistently told us one thing, namely that the economy is slowing and that the trucking industry is bearing the brunt of the recession, analysts continue to make excuses for the poor numbers while holding out what seems like neverending hope for a turnaround.






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t the data doesn't lie: February Class 8 orders fell 16%. The month is traditionally a slower one for the heavy duty trucking industry, but this year included an extra day. The seasonally adjusted orders were the weakest monthly order rate since last August, according to ACT Research. 










ACT’s senior analyst Kenny Vieth said: "Weak freight market and rate conditions, as well as a still-large backlog, continue to bedevil new Class 8 orders." 





Thanks for that groundbreaking analysis of the situation. Lest we forgetACT Research had said last month that it expected the backlog in Class 8 orders to "continue to wear away". We guess that is no longer the case.










Forward projections for the rest of the year don't look optimistic either. Analyst Ann Duignan from JP Morgan has said she expects production of ~236,000 Class 8 units in 2020, or down 31% y/y. She is also estimating ~240,000 units in 2021, or up 2%. We anticipate that these numbers could vary sharply depending on how severe the coronavirus outbreak in the U.S. winds up becoming. 








After blowing $100m to snoop on Americans' phone call logs for four years, what did the NSA get? Just one lead

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Section 215 more useless than we suspected yet they still want to keep it

The controversial surveillance program that gave the NSA access to the phone call records of millions of Americans has cost US taxpayers $100m – and resulted in just one useful lead over four years.…


Nomura's Call For Recession In Italy Suddenly Doesn't Look So 'Aggressive'

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Nomura's Call For Recession In Italy Suddenly Doesn't Look So 'Aggressive'

One week ago, a team of analysts at Nomura research covering the European economy made a bold prediction: Italy's economy would enter a technical recession during Q1 as the fallout from COVID-19 reverberates across global supply chains upon which the country's prosperous North depends.

At the time, Italy had only 3 confirmed coronavirus cases, and it appeared that the out

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break would mostly pass it by without much of a direct economic backlash. Fellow economists commiserated about this 'aggressive' call, and speculated about the impact that declaring a 'technical recession' in the eurozone's third-largest economy might have on consumer sentiment across the Continent.

On Tuesday, that picture was looking very different. And while the call appeared aggressive a week ago, today, if anything, it might not prove weak enough.

Though the virus officially spread to the Italian South on Tuesday, it has mostly affected the affluent North, particularly the regions in the "splayed" top of the Italian 'boot'. So far, the 100,000 Italians under army-supervised lockdown are located mostly in towns and villages. Still, the fallout For Lombardia, Veneto, Emilia Romagna and Piemonte could have serious repercussions. Veneto and Lombardia alone constitute two of the three most important provinces in terms of contribution to overall GDP.

The fact that the virus has made it to Milan is particularly alarming. The city is the 12-most densely populated in Europe, and it's widely considered the center of Italian industry - Italy's New York City. 2.5 million people live in Milan, and there are 10 million in Lombardia, the surrounding province.

On a QoQ basis, Italy's economy contracted in Q4 (even if it climbed YoY). Another quarterly slide and Italy will be in what's called a 'technical recession', which is precisely that - two consecutive quarters of GDP decline.

While conventional wisdom would suggest that even a few week's worth of these broad-based shutdowns of schools and some public spaces like restaurants and sporting events would have an impact. Should the shutdowns expand to broader sectors of the economy - factories, offices etc. - then of course the backlash would be worse.

As of Tuesday, Italy had confirmed more than 300 cases, with the largest cluster in Lombardy, and 10 deaths. It's now officially home to the worst COVID-19 outbreak in Europe, though it might soon have some competition.

"In summary," the team concludes, "a week ago the downward revision to our forecast for a recession in Italy had looked like a bold call. Not any more. If anything, the risks to our forecasts for Italian growth this year are now tilted firmly to the downside."

But at this point, even the virologists are having a hard time predicting what's going to happen next. So what hope does Wall Street have?

Tyler Durden

Wed, 02/26/2020 - 05:45

Unfriendly Skies: Southwest Airlines Wants You To Call Out Bad Behavior

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Unfriendly Skies: Southwest Airlines Wants You To Call Out Bad Behavior

Perhaps we can expect a lot more delayed flights and passenger infighting and general craziness over this next year as Southwest airlines has just implemented a controversial new policy. 

As part of its required pre-flight emergency briefing, Southwest Airlines will now encourage passengers to report any "unwelcome behavior" that occurs to the flight attendants

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Image via CNN

The policy went into effect January 22, and the statement comes immediately after instructions over operating the oxygen masks. CNN recorded an announcement at Hartsfield-Jackson Atlanta International Airport as saying: "We are here for your comfort and safety. Please report any unwelcome behavior to your flight attendant. Thank you for your attention."

Southwest spokesman Brian Parrish told CNN: "This change reflects Southwest's commitment to ensuring a safe and welcoming environment at all times." He added that passengers should see the flight attendants as "an approachable, professional resource for reporting any unwelcome behaviors or conduct during a flight."

However, in these times of heightened paranoia, there's a hundred ways this could go wrong, given the hundred different interpretations and thresholds different people have for what's deemed vaguely as "unwelcome behavior" (won't share an elbow rest? talking too loud? bad breath? someone merely doesn't like that there's a Muslim on board?).

Recently an American Airlines flight was delayed when a man who boarded wearing a gas mask (and not merely a surgical mask), made neighboring passengers uncomfortable to the point of causing enough of a panic to significantly delay the flight. And in a Southwest Airlines incident which made national news, a dad and his toddler were kicked off a flight because the 2-year old threw a minor tantrum upon boarding. This happened even after the child had calmed down. 

There have also been multiple instances over the past years of flights canceled or delayed simply because passengers and crew members felt "uncomfortable" upon seeing men wearing Muslim garb on board. 

The new Southwest Airlines policy appears aimed at preventing in-flight sexual assaults or harassment, which authorities say have been on the rise. According to FBI figures cited by CNN:

FBI investigations into midair sexual assaults increased by 66% over a four-year period, from fiscal year 2014 to 2017. The bureau reported that it had opened 63 investigations into sexual assault on aircraft in 2017, compared with 57 in 2016, 40 in 2015 and 38 in 2014.

If notified of an assault or harassment, the airline says its crew members have been given a variety of options depending on the situation — from demanding the offending passenger stop their behavior to notifying the captain, or to alerting law enforcement on the ground should a significant incident take place. 

Tyler Durden

Sat, 02/22/2020 - 22:00

GRU won't believe it: UK and US call out Russia for cyber-attacks on Georgia last year

logicfish Security wont believe call russia cyber-attacks georgia last year All https://go.theregister.co.uk   Discuss    Share
It's APT28 again! Public attribution names and shames state-backed crew

The same Russian state hackers who unleashed NotPetya on the world's computers were behind destructive cyberattacks on Georgia during 2019, the governments of Britain and the US have said – echoing a similar attribution a decade ago.…


Global Stocks Slide After Apple Guidance Cut Is "Wake Up Call" To Zombified Investors

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Global Stocks Slide After Apple Guidance Cut Is "Wake Up Call" To Zombified Investors

Two weeks ago, when looking at the supply-chain crippling consequences of the Coronavirus epidemic, we asked "Is Tech About To Suffer A "Dot Com" Bubble Collapse?" and concluded that "It's now all in China's hands" noting that "...while the market leaders did not disappoint in the last quarter of 2019 when stocks exploded higher with the blessing of the Fed's QE

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4, what about the current quarter and the future? What happens to revenues and demand, to established supply chains, to profit margins, if the Coronavirus epidemic keep spreading and tens of millions of Chinese remain under quarantine? What happens to Apple's iPhone sales in China if the Cupertino company is unable to reopen its store for a month, or two, or three?"

Then, a week later, just in case algos were still unclear who is most at risk to the coronavirus pandemic, we said that "the one sector with the greatest exposure to Greater China and Asia Pacific in general, is also the sector that has outperformed the most in recent months. Tech."

As such, while we were certainly not surprised to learn that AAPL took advantage of the quiet President's Day Holiday to cut revenue guidance for the current quarter - guidance which it laid out just three weeks ago on Jan 28 - warning that production and retail store closures have lasted longer than "anticipated" just a month ago (despite our warning that AAPL would cut guidance just days after the company's earnings release due to the coronavirus), judging by the plunge in AAPL stock which tumbled as much as 4% this morning, the AAPL news sure came as a surprise to all the millennials and algos that set marginal prices in this "market."

"Work is starting to resume around the country, but we are experiencing a slower return to normal conditions than we had anticipated. As a result, we do not expect to meet the revenue guidance we provided for the March quarter due to two main factors.

The first is that worldwide iPhone supply will be temporarily constrained. While our iPhone manufacturing partner sites are located outside the Hubei province — and while all of these facilities have reopened — they are ramping up more slowly than we had anticipated. The health and well-being of every person who helps make these products possible is our paramount priority, and we are working in close consultation with our suppliers and public health experts as this ramp continues. These iPhone supply shortages will temporarily affect revenues worldwide."

And to be fair, while many companies have by now issued warnings it seems it had to take Apple for the market to wake up, spooked amid hopes for a limited economic impact from the deadly coronavirus.

It wasn't just AAPL however: HSBC - Europe's largest bank - announced a massive restructuring that involved shedding $100 billion of assets and slashing 35,000 jobs over three years. It also warned about the impact of the coronavirus on its Asia business. The stock fell more than 2% in Hong Kong trade.

And as two of the world’s mega companies reported damage from the coronavirus outbreak, world stocks markets were knocked off record highs on Tuesday, with equities around the globe a sea of red, while Treasuries rose and the dollar edged higher.

The warning from Apple sobered investors who had hoped fiscal stimulus from China (which we reported over the weekend is not coming after the Global Times warned to brace for austerity) and other countries would protect the global economy from the effects of the epidemic, sending contracts on the three major U.S. equity benchmarks sharply lower, with Apple shares slumping as much as 4.2% in pre-market trading. We know, shocking, right: you can't print your way out of a global viral pandemic.

"We have been pointing out that the market reaction in past weeks was excessively constructive and this could be a wake-up call to all investors that ignored so far potential negative impact,” analysts at UniCredit said.

“Apple is saying its recovery could be delayed, which could mean the impact of the virus may go beyond the current quarter,” said Norihiro Fujito, chief investment strategist at Mitsubishi UFJ Morgan Stanley Securities. “If Apple shares were traded cheaply, that might not matter much. But when they are trading at a record high, investors will be surely tempted to sell.”

In Europe, tech stocks were the biggest laggards in the Stoxx 600 index as Apple suppliers including Dialog Semiconductor Plc and AMS AG slid. HSBC Plc tumbled the most in more than a decade after saying it will slash jobs in a “fundamental restructuring,” while also flagging risks due to the virus. Europe's 0.4% to 0.5% declines came after Tokyo's Nikkei dropped 1.4% as tech stocks globally reacted to Apple's warning.  There was more bad news in Europe after Germany's latest ZEW Economic Sentiment printed at a dismal 8.7, far below the 26.7 in January and a huge miss to the 21.5 expected, confirming that Germany's economy is set for another slump and this time recession may be unavoidable.

Earlier in the session, Asian stocks fell as semiconductor equities took a hit on the Apple news, and as investors finally realized the virus outbreak in China is taking a bigger-than-predicted toll on one of the world’s most-valuable companies. The MSCI Asia Pacific Index dropped 1.1%, led by declines in technology and communication services shares. Most markets in the region were down, with South Korea’s Kospi index, Hong Kong’s Hang Seng Index and Japan’s Topix index sliding more than 1%. India’s Sensex index declined to two-week low. China's CSI300 gave up 0.5% after gaining on Monday, encouraged by a central bank rate cut and government stimulus hopes. TSMC lost 2.9%. Samsung Electronics dropped 2.9% and Sony Corp shed 2.5% after the Apple coronavirus warning.

Meanwhile, as China’s authorities try to prevent the spread of the disease or at least fabricate data suggesting Beijing is winning the war on the coronavirus, the economy is paying a heavy price. Some cities remain locked down, streets are deserted, and travel bans and quarantine orders are preventing migrant workers from getting back to their jobs. In short, as we showed on Friday, China's economy is "disintegrating" and frankly it is shocking it took the market as long as it did to finally realize it. As Reuters finally admits, "many factories have yet to re-open, disrupting supply chains in China and beyond, as highlighted by Apple."

As investors dumped risk assets, bonds were in demand, with the 10-year U.S. Treasuries yield falling 4 basis point to just above 1.5%, while safe-haven gold rose to its highest in two weeks and oil prices fell nearly 2% after five days of gains. China’s 10-year government bond yield declined following a two-day rise, amid risk-off sentiment in Asia after Apple warned. Futures contracts on notes of the same tenor also rose for the first time in three days. That came despite the People’s Bank of China’s net withdrawal of 220 billion yuan worth of cash from the financial system on Tuesday. The central bank drained another 700 billion yuan Monday, even though it provided medium-term loans to commercial banks and cut the rate its charges for the money by 10 basis points.

"Sentiment toward global risk turned sour today,” said Dariusz Kowalczyk, an EM strategist at Credit Agricole. "We continue to believe that markets have not yet fully priced in the magnitude of the hit to China’s economy as a result of the Covid-19 outbreak."

In FX, the yen rose 0.15% to 109.69 yen per dollar while the risk- and China-sensitive Australian dollar lost 0.4% to $0.6686. The yuan was steadier, trading at 6.9950 per dollar. The euro was near a three-year low versus the dollar at $1.0830 before Germany's ZEW survey, which is expected to fuel growing pessimism about Europe's largest economy. [/FRX]

Expected data include U.S. Empire State Manufacturing Survey. PG&E, Walmart, Air Canada, and Agilent are among companies reporting earnings

Market Snapshot

  • S&P 500 futures down 0.5% to 3,363.50

  • STOXX Europe 600 down 0.6% to 429.56

  • MXAP down 1.1% to 168.17

  • MXAPJ down 1.1% to 550.53

  • Nikkei down 1.4% to 23,193.80

  • Topix down 1.3% to 1,665.71

  • Hang Seng Index down 1.5% to 27,530.20

  • Shanghai Composite up 0.05% to 2,984.97

  • Sensex down 0.6% to 40,806.11

  • Australia S&P/ASX 200 down 0.2% to 7,113.70

  • Kospi down 1.5% to 2,208.88

  • German 10Y yield fell 2.1 bps to -0.422%

  • Euro down 0.06% to $1.0829

  • Italian 10Y yield fell 1.5 bps to 0.74%

  • Spanish 10Y yield fell 2.4 bps to 0.265%

  • Brent futures down 1.9% to $56.60/bbl

  • Gold spot up 0.5% to $1,588.52

  • U.S. Dollar Index up 0.2% to 99.22

Top Overnight News from Bloomberg

  • Apple Inc.’s shares fell 4.1% in pre-market trading after the company said the fallout from the coronavirus will cause it to miss its sales targets this quarter, sending shockwaves across tech stocks globally

  • Intesa Sanpaolo SpA launched one of the biggest European banking deals since the financial crisis with an unsolicited 4.9 billion-euro ($5.3 billion) bid for smaller rival Unione di Banche Italiane SpA

  • Investors have been plunged back into a gloomy mood over the German economy on concern the coronavirus outbreak in China will disrupt global trade, with expectations for the next six months falling below even the most pessimistic estimate in a Bloomberg survey

  • The U.K. economy created jobs at an impressive pace in the fourth quarter, defying the political turmoil over Brexit, with the jobless rate at a four-decade low of 3.8%

Asia-Pac equities traded with losses across the board following a non-existent lead from Wall Street, but as sentiment was dented following a profit warning by Apple, citing the coronavirus outbreak. At the electronic open, major US equity futures experienced downside, with Nasdaq Mar’20 futures immediately giving up the 9600 mark as Apple carries an 11%+ weighting in the index. ASX 200 (-0.2%) was led lower by broad losses across the majority of its stocks in the index, and with material names pressured amid a pullback in base metal prices and as mining-giant BHP traded lower despite topping Adj. EBITDA and underlying profit forecasts, as the miner anticipates net demand losses in the near term amid the virus outbreak. Nikkei 225 (-1.4%) conformed to the overall risk tone but underperformed the region throughout a bulk of the session amid currency dynamics, and with Nissan shares under renewed pressure after its CEO foresees challenges to earnings and cashflow for the remainder of the FY. Other notable movers from the Apple fallout included Samsung Electronics, Taiwan Semiconductor, SK Hynix and Pegatron whose shares all traded lower by 1.5-3.0%. Elsewhere, Hang Seng (-1.5%) and Shanghai Comp (U/C) joined the downbeat performance across the region, with the former weighed on by its heavyweight financials and oil-giants, whilst the latter fared slightly better following yesterday’s PBoC stimulus injection.

Top Asian News

  • How Fast Can China’s Economy Bounce Back from Virus Lockdown

  • Apple’s Outlook Cut Revives Questions About China Over- Reliance

  • Singapore Aims to Phase Out Internal Combustion Vehicles By 2040

  • AXA-Affin Insurer Said to Draw Great Eastern, Generali Interest

European equities (Eurostoxx 50 -0.4%) mostly reside in negative territory as the fallout from Apple’s (pre-market -3.3%), revenue warning reverberates across the marketplace. Apple ‘s warning for Q1 revenue guidance was attributed to the coronavirus with the Co. noting it is experiencing a slower return to normal conditions than had anticipated and noted slower demand in products in China alongside iPhone supply constraints. Given that rival peers will likely be subject to similar supply-chain disruptions, IT names lag this morning with ASML International (-2.0%), Dialog Semiconductor (-4.5%), STMicroelectronics (-3%) and Infineon (-1.5%) all enduring losses. From a more medium-term perspective (referring to the US semiconductor sector), Credit Suisse notes “while we expect Semis to trade lower - we would recommend investors who can look into 2H and beyond should use weakness to accumulate best in class companies with a solid structural outlook”. Elsewhere, given the broader macro implications of Apple’s warning, material names are also softer thus far with uninspiring updates from Glencore (-3.9%) and BHP (-2.6%) pressuring the sector. Financials are falling victim to lower yields and a lacklustre update from HSBC (-5.7%) with the Co. unveiling a 33% decline in profits and a restructuring plan that will lead to a job cull of around 35k. Bucking the trend of the pessimism in Europe is the FTSE MIB (+0.3%), in the wake of Intesa Sanpaolo’s (+2.0%) takeover approach for UBI Banca (+22%), which has also stoked optimism around the prospect of further sector consolidation in Italy.

Top European News

  • InterContinental Hotels Full Year Revenue Meets Estimates

  • U.K. Employment Surges as Labor Market Shrugs Off Weak Economy

  • Emissions Clampdown Sends Europe Car Sales to January Slide

  • German Investor Confidence Plunges Amid Coronavirus Risks

In FX, although daily updates from China continue to signal that the worst may be over in terms of coronavirus cases and casualties, Apple has joined others issuing warnings about the fallout hitting Q1 production and sales targets with wider repercussions for the tech sector and risk sentiment in general. Hence, the traditional safe haven currencies (and assets) have regained a firm bid after losing some appeal at the start of the week and the DXY is back on track to post higher 2020 peaks as it edges further above 99.000 with only the likes of the Yen, Franc and Gold managing to keep pace or stay ahead of the Greenback. Indeed, Usd/Jpy has eased back a bit further from recent 110.00+ levels, while Usd/Chf is gravitating back towards 0.9800 alongside Eur/Chf on the 1.0600 handle and Usd/Xau is just below Usd1590/oz compared to a low of Usd1579 yesterday. Back to the index, 99.249 resistance has been eclipsed and 99.500 is the obvious next target for bulls ahead of last year’s 99.667 best.

  • NZD/AUD/SEK/NOK - The Antipodes are vying with their Scandi peers for the unenviable, though largely unavoidable tag of biggest G10 lower, and the Kiwi is shading it as Nzd/Usd slips under 0.6400 and Aud/Nzd holds near 1.0450 even though Aud/Usd has lost grip of the 0.6700 handle in wake of RBA minutes also flagging the Chinese nCoV outbreak as the biggest near term threat and keeping a rate cut on the table. Meanwhile, the Swedish Crown has been undermined by a rebound in jobless rates and its Norwegian counterpart by a sharp retreat in crude prices amidst the broad deterioration in risk appetite, with Eur/Sek up over 10.5600 at one stage and Eur/Nok near the top of a 10.0220-10.1100 range.

  • GBP - Bucking the overall trend, and seemingly gleaning a belated fillip from encouraging UK jobs data (claimant count and employment change) Cable has recouped all and more of its losses around 1.3000 after testing major technical support at 1.2971 (where the 10 DMA aligns with a 50% Fib retracement), while Eur/Gbp has reversed from circa 0.8350 to just above 0.8300. Note, some selling subsequently noted in the headline pair around the 200 WMA (1.3038).

  • EUR/CAD - Both succumbing to widespread Usd strength, with the single currency also weighing up divergent independent factors in the form of a worrying ZEW survey in contrast to reports that all Eurogroup Finance Ministers are on board with apportioning some budget finances in the event of an economic downturn, whatever that is deemed to be in terms of severity and how much cash will be allocated. Eur/Usd skirting last week’s 1.0821 base vs around 1.0837 at one stage, while Usd/Cad straddles 1.3250 ahead of Canadian manufacturing sales and with the Loonie also hampered by the aforementioned recoil in oil.

  • EM - Further depreciation vs the Dollar across the board, but the Rand also wary about more Eskom load-shedding, while the Lira and Rouble are still embroiled in Syria-related issues, and the latter also undermined by heightened conflict in the Ukraine.

In commodities, WTI and Brent front month futures are subdued this morning with losses just shy of USD 1/bbl at present in-line with the general risk sentiment. Newsflow has picked up on the geopolitical front, although not enough to dictate price action at present; with focus returning to the ongoing dispute between Russia and Ukraine which has flamed up once more on reports of heavy fighting in the Lugansk province. Ukraine has one of the largest gas transmission systems in the world, which is heavily linked to Russian, Belarus, Poland and other surrounding nations; the region in question does contain a number of gas pipelines but it is unclear as to whether they are currently in use as a bypass has been constructed. Focus will remain on how this escalates, and if it leads to disruptions to gas supply. Sticking with Russia, the Kremlin this morning noted that Energy Minister Novak is still considering his position with reference to the recommended JTC production cuts. In terms of outlook, given the coronavirus ING have revised down their price forecasts as the virus causes consumption to drop; with cuts of USD 5/bbl for Q1 Brent (from USD 60/bbl to USD 55/bbl), although their forecasts are unchanged by 2021. Note, given the US holiday the weekly API and EIA metrics will be released one day late on Wednesday and Thursday respectfully. Turning to metals, where spot gold is firmer this morning on the aforementioned geo-political tensions and as the coronavirus begins to impact US tech giants; albeit, the metal has dipped marginally from session highs in recent trade ahead of the US’ entrance to market. Elsewhere, copper prices are little changed but were hit overnight in-line with general risk sentiment.

US Event Calendar

  • 8:30am: Empire Manufacturing, est. 5, prior 4.8

  • 10am: NAHB Housing Market Index, est. 75, prior 75

  • 4pm: Net Long-term TIC Flows, prior $22.9b

  • 4pm: Total Net TIC Flows, prior $73.1b

DB's Jim Reid concludes the overnight wrap

In the same way a solar eclipse requires the sun and earth’s orbit to be completely in synch, tonight the orbits of my work travel and my favourite football team’s all conquering path through world football are perfectly aligned. After a busy day of meetings in Madrid (I had to say that) I’m off to the Wanda Metropolitan stadium to watch Liverpool take on Athletico Madrid in the Champions League. I’ve got a feeling I’m in the home end so if you’re watching it on the telly and see one guy with the opposite reaction to the rest of the surrounding crowd then you’ll know it’s me.

If you had to describe yesterday in football parlance it would be a dull 0-0 with no shots on target for either side. The US holiday and half term drove down activity to a crawl. However after the time that the US market would have closed had it not been on holiday Apple issued a revenue warning for Q1 and became the highest profile market victim of the virus impact so far.

The company said in a statement that while work is starting to resume in China, “we are experiencing a slower return to normal conditions than we had anticipated,” and global iPhone supply will be “temporarily constrained.” Apple suppliers including TDK Corp. (-3.87%) and Tokyo Electron Ltd. (-5.06%) slumped after the warning. Comments from Apple came after similar comments by the American Chamber of Commerce in Shanghai. They said that most US factories in China’s manufacturing hub around Shanghai will be back at work this week, but the “severe” shortage of workers due to the coronavirus will hit production and global supply chains. Our FX Analysts updated a piece yesterday that shows that our proprietary shipping data still hasn’t recovered yet post the NY holidays and virus shutdowns (link here). We’ll continue to watch this data for signs of economic activity picking back up.

Also impacting sentiment overnight is news from Bloomberg that the White House is considering new restrictions on exports of cutting-edge technology to China in a push aimed at limiting Chinese progress in developing its own passenger jets and also on clamping down further on Huawei’s access to vital semiconductors. The report added that senior officials are expected to decide by the end of this month whether to block exports of jet engines made by a JV of General Electric and France’s Safran to China. Further, the administration is also considering separate measures to broaden export controls related to the existing restrictions on Huawei by blocking foreign chipmakers, such as Taiwan’s TSMC and US suppliers, from selling components made overseas to Huawei.

Markets are heading lower in Asia this morning on the back off these stories with the Nikkei (-1.46%), Hang Seng (-1.45%), Shanghai Comp (-0.37%) and Kospi (-1.47%) all down. As for Fx, the onshore Chinese yuan is down -0.21% to 6.9958 and the Australian dollar is down -0.36% as the RBA said that it considered a rate cut at its last meeting but shied away from it to avoid extra borrowing as house prices rise. Elsewhere, futures on the S&P 500 are down -0.30% while yields on 10yr USTs are down -3.7bps as they reopened post a holiday with 30yrs back below 2% again. Brent crude oil prices are down -1.04% and spot gold prices are up +0.29%.

The latest on the virus is that in China the total confirmed cases now stand at 72,436 with the death toll at 1,868. Japan also said overnight that it will remove all passengers from the quarantined cruise liner by Friday. There were 454 confirmed cases of the virus on the ship by yesterday. Also worth flagging was the news yesterday that Macau casinos will reopen this Thursday, albeit conditional based on unspecified criteria according to the secretary for economy and finance in Macau.

This all followed a very uneventful session in Europe yesterday. The STOXX 600 closed up +0.34%, bucking two consecutive down days and traded in a range of less than half a percent as sentiment got a boost from the China stimulus announcement which came before Europe had walked in. There were similar gains also for the DAX (+0.29%) and CAC (+0.27%) while the FTSE MIB outperformed with a +1.02% gain. BTPs also had a better day than their counterparts, with yields down -1.6bps versus +0.1bps for Bunds although there didn’t appear to be any specific Italy-related news which helped the outperformance so it’s probably more the high beta element driving the price action.

Elsewhere, the euro was little changed after losing ground almost every day in February so far, while in commodities there wasn’t much to talk about in Oil or Gold either, with both also trading fairly flattish through the last 24 hours. Meanwhile in credit, HY spreads in Europe were -1.8bps tighter. Speaking of credit its worth seeing how Kraft Heinz bonds trade today following their downgrade to HY by Fitch and then later S&P on Friday. Given that the S&P move came very late in the day we haven’t really seen the full reaction yet. Craig and Nick put out a note yesterday which looked at the technical impact the downgrade will have on the HY market. It also looks at other potential fallen angel candidates and where their bonds trade relative to the average BBB- and BB+ bonds. See the US note here and the Euro one here. As we said yesterday this is a real glimpse into the future problems in credit markets. When the economy turns there will likely be a huge problem given the weight of weaker BBBs out there. For now though this is likely idiosyncratic.

BBB used to mean Brexit, Brexit and more Brexit until the recent lull in newsflow. In another glimpse of problems down the line, the U.K. chief Brexit negotiator David Frost last night aggressively pushed back on the EU’s insistence on a level playing field provision in trade talks saying that “We must have the ability to set laws that suit us” and that having to abide by EU rules “simply fails to see the point of what we are doing”. Not a surprise but confirms the expected likely high tensions ahead.

In other news, Bloomberg ran a story yesterday looking at the political frictions impeding another ECB rate cut. On a similar vein it’s worth highlighting a report our economists in Europe published on asking whether the ECB was heading for another showdown between the monetary policy technicians on the one side and the monetary policy politicians on the other. The team discuss the rising risks to their baseline assumption that ECB policy will remain unchanged this year. These are: First, the coronavirus. Second, the weakness of the euro area economy just before the virus. Some on the ECB see space for further easing, if needed. Others would find it more difficult to ease. There are arguments supporting a more patient attitude, that is, a less reactive policy stance. One main reason is that the more the ECB reacts to events the more it delays fiscal policy which is ultimately what the ECB wants. We suspect patience is also what Lagarde would prefer, as long as the euro area is not facing a substantial downgrading of the outlook.

Looking at the day ahead, this morning it’ll be worth keeping an eye on the December and January labour market data in the UK before we get the February ZEW survey in Germany. With the US returning, data releases will include the February empire manufacturing print and February NAHB housing market index reading.

Tyler Durden

Tue, 02/18/2020 - 07:51

Over 2,000 Former DOJ Officials Call On Barr To Resign Over Roger Stone Case

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Over 2,000 Former DOJ Officials Call On Barr To Resign Over Roger Stone Case

Over 2,000 former Justice Department officials have called on Attorney General William Barr to step down after he stepped in last week to rescind a sentencing recommendation of 7-9 years filed by four anti-Trump career prosecutors, resulting in their resignations.

"It is unheard of for the Department’s top leaders to overrule line prosecutors

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/strong>, who are following established policies, in order to give preferential treatment to a close associate of the President, as Attorney General Barr did in the Stone case," wrote the former DOJ officials in a Sunday letter. "It is even more outrageous for the Attorney General to intervene as he did here — after the President publicly condemned the sentencing recommendation that line prosecutors had already filed in court."

"Each of us strongly condemns President Trump’s and Attorney General Barr’s interference in the fair administration of justice," the letter continues, adding that those actions "require Mr. Barr to resign."

Last Tuesday, AP reported that the Justice Department would "take the extraordinary step of lowering the recommended prison time for Roger Stone, an ally of President Donald Trump, a federal official said Tuesday."

According to  a Fox News source, however, the DOJ felt the original recommendation was "extreme, excessive, and grossly disproportionate" to Stone's crimes.


Tyler Durden

Mon, 02/17/2020 - 21:09

Escobar: The Siren Call Of A "System Leader"

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Escobar: The Siren Call Of A "System Leader"

Authored by Pepe Escobar via The Asia Times,

A considerable spectrum of the liberal West takes the American interpretation of what civilization consists of to be something like an immutable law of nature. But what if this interpretation is on the verge of an irreparable breakdown?

Michael Vlahos has argued that t

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he US is not a mere nation-state but a “system leader” – “a civilizational power like Rome, Byzantium, and the Ottoman Empire.” And, we should add, China – which he did not mention. The system leader is “a universalistic identity framework tied to a state. This vantage is helpful because the United States clearly owns this identity framework today.”

Intel stalwart Alastair Crooke, in a searing essay, digs deeper into how this “civilizational vision” was “forcefully unfurled across the globe” as the inevitable, American manifest destiny: not only politically – including all the accouterments of Western individualism and neo-liberalism, but coupled with “the metaphysics of Judeo-Christianity, too”.

Crooke also notes how deeply ingrained the notion that victory in the Cold War “spectacularly affirmed” the superiority of the US civilizational vision among the US elite.

Well, the post-modern tragedy – from the point of view of US elites – is that soon this may not be the case anymore. The vicious civil war engulfing Washington for the past three years – with the whole world as stunned spectators – has just accelerated the malaise.

Remember Pax Mongolica

It’s sobering to consider that Pax Americana may be destined to a shorter historical existence than Pax Mongolica – established after Genghis Khan, the head of a nomad nation, went about conquering the world.

Genghis first invested in a trade offensive to take over the Silk Roads, crushing the Kara-Kitais in Eastern Turkestan, conquering Islamic Khorezm, and annexing Bukhara, Samarkand, Bactria, Khorasan and Afghanistan. The Mongols reached the outskirts of Vienna in 1241 and the Adriatic Sea one year after.

The superpower of the time extended from the Pacific to the Adriatic. We can barely imagine the shock for Western Christendom. Pope Gregory X was itching to know who these conquerors of the world were, and could be Christianized?

In parallel, only a victory by the Egyptian Mamluks in Galilee in 1260 saved Islam from being annexed to Pax Mongolica.

Pax Mongolica – a single, organized, efficient, tolerant power – coincided historically with the Golden Age of the Silk Roads. Kublai Khan – who lorded over Marco Polo – wanted to be more Chinese than the Chinese themselves. He wanted to prove that nomad conquerors turned sedentary could learn the rules of administration, commerce, literature and even navigation.

Yet when Kublai Khan died, the empire fragmented into rival khanates. Islam profited. Everything changed. A century later, the Mongols from China, Persia, Russia and Central Asia had nothing to do with their ancestors on horseback.

A jump cut to the young 21st century shows that the initiative, historically, is once again on the side of China, across the Heartland and lining up the Rimland. World-changing, game-changing enterprises don’t originate in the West anymore – as has been the case from the 16th century up to the late 20th century.

For all the vicious wishful thinking that coronavirus will derail the “Chinese century”, which will actually be the Eurasian Century, and amid the myopic tsunami of New Silk Roads demonization, it’s always easy to forget that implementation of myriad projects has not even started.

It should be in 2021 that all those corridors and axes of continental development pick up speed across Southeast Asia, the Indian Ocean, Central Asia, Southwest Asia, Russia and Europe, in parallel with the Maritime Silk Road configuring a true Eurasian string of pearls from Dalian to Piraeus, Trieste, Venice, Genoa, Hamburg and Rotterdam.

For the first time in two millennia, China is able to combine the dynamism of political and economic expansion both on the continental and maritime realms, something that the state did not experience since the short expeditionary stretch led by Admiral Zheng He in the Indian Ocean in the early 15th century. Eurasia, in the recent past, was under Western and Soviet colonization. Now it’s going all-out multipolar – a series of complex, evolving permutations led by Russia-China-Iran-Turkey-India-Pakistan-Kazakhstan.

Every player has no illusions about the “system leader” obsessions: to prevent Eurasia from uniting under one power – or coalition such as the Russia-China strategic partnership; ensure that Europe remains under US hegemony; prevent Southwest Asia – or the “Greater Middle East” – from being linked to Eurasian powers; and prevent by all means that Russia-China have unimpeded access to maritime lanes and trade corridors.

The message from Iran

In the meantime, a sneaking suspicion creeps in – that Iran’s game plan, in an echo of Donbass in 2014, may be about sucking US neocons into a trademark Russian cauldron in case the regime-change obsession is turbocharged.

There is a serious possibility that under maximum pressure Tehran might eventually abandon the JCPOA for good, as well as the NPT, thus openly inviting a US attack.

As it stands, Tehran has sent two very clear messages. The accuracy of the missile attack on the US Ayn Al-Asad base in Iraq, replying to the targeted assassination of Major General Qassem Soleimani, means that any branch of the vast US network of bases is now vulnerable.

And the fog of non-denial denials surrounding the downing of the CIA Battlefield Airborne Communications Node (BACN) – essentially an aerial spook shop – in Ghazni, Afghanistan also carries a message.

CIA icon Mike d’Andrea, known as ‘Ayatollah Mike’, The Undertaker, the Dark Prince, or all of the above, may or may not have been on board. Irrespective of the fact that no US government source will ever confirm or deny that Ayatollah Mike is dead or alive, or even that he exists at all, the message remains the same: your soldiers and spooks are also vulnerable.

Since Pearl Harbor, no nation has dared to stare down the system leader so blatantly, as Iran did in Iraq. Vlahos mentioned something I saw for myself in 2003, how “young American soldiers referred to Iraqis as ‘Indians’, as though Mesopotamia were the Wild West”. Mesopotamia was one the crucial cradles of civilization as we know it. Well, in the end, that $2 trillion spent to bomb Iraq into democracy did no favors to the civilizational vision of the ‘system leader’.

The Sirens and La Dolce Vita

Now let’s add aesthetics to our “civilizational” politics. Every time I visit Venice – which in itself is a living metaphor for both the flimsiness of empires and the Decline of the West – I retrace selected steps in The Cantos, Ezra Pound’s epic masterpiece.

Last December, after many years, I went back to the church of Santa Maria dei Miracoli, also known as “The jewel box”, which plays a starring role in The Cantos. As I arrived I told the custodian signora that I had come for “The Sirens”. With a knowing smirk, she lighted my way along the nave to the central staircase. And there they were, sculpted on pillars on both sides of a balcony: “Crystal columns, acanthus, sirens in the pillar head”, as we read in Canto 20.

These sirens were sculpted by Tullio and Antonio Lombardo, sons of Pietro Lombardo, Venetian masters of the late 15th and early 16th century – “and Tullio Romano carved the sirens, as the old custode says: so that since then no one has been able to carve them for the jewel box, Santa Maria dei Miracoli”, as we read in Canto 76.

Well, Pound misnamed the creator of the sirens, but, that’s not the point. The point is how Pound saw the sirens as the epitome of a strong culture – “the perception of a whole age, of whole congeries and sequence of causes, went into an assemblage of detail, whereof it would be impossible to speak in terms of magnitude”, as Pound wrote in Guide to Kulchur.

As much as his beloved masterpieces by Giovanni Bellini and Piero della Francesca, Pound fully grasped how these sirens were the antithesis of usura – or the “art” of lending money at exorbitant interest rates, which not only deprives a culture of the best of art, as Pound describes it, but is also one of the pillars for the total financialization and marketization of life itself, a process that Pound brilliantly foresaw, when he wrote in Hugh Selwyn Mauberley that, “all things are a flowing, Sage Heracleitus says; But a tawdry cheapness, shall reign throughout our days.”

La Dolce Vita will turn 60 in 2020. Much as Pound’s sirens, Fellini’s now mythological tour de force in Rome is like a black and white celluloid palimpsest of a bygone era, the birth of the Swingin’ Sixties. Marcello (Marcello Mastroianni) and Maddalena (Anouk Aimee), impossibly cool and chic, are like the Last Woman and the Last Man before the deluge of “tawdry cheapness”. In the end, Fellini shows us Marcello despairing at the ugliness and, yes, cheapness intruding in his beautiful mini-universe – the lineaments of the trash culture fabricated and sold by the ‘system leader’ about to engulf us all.

Pound was a human, all too human American maverick of unbridled classical genius. The ‘system leader’ misinterpreted him; treated him as a traitor; caged him in Pisa; and dispatched him to a mental hospital in the US. I still wonder whether he may have seen and appreciated La Dolce Vita during the 1960s, before he died in Venice in 1972. After all, there was a little cinema within walking distance of the house in Calle Querini where he lived with Olga Rudge.

“Marcello!” We’re still haunted by Anita Ekberg’s iconic siren call, half-immersed in the Fontana di Trevi. Today, still hostages of the crumbling civilizational vision of the ‘system leader’, at best we barely muster, as TS Eliot memorably wrote, a “backward half-look, over the shoulder, towards the primitive terror.”

Tyler Durden

Fri, 02/14/2020 - 23:05

Call us immediately if your child uses Kali Linux, squawks West Mids Police

logicfish Security call immediately your child uses kali linux squawks west mids police All https://go.theregister.co.uk   Discuss    Share
Maybe stick to walking the beat instead of infosec advice, eh?

The National Crime Agency has publicly distanced itself from a poster urging parents to call police if their child has installed Kali Linux, Tor or – brace yourself – Discord.…


Opening For US Troop Exit? NATO Heeds Trump's Call To Expand In Iraq

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Opening For US Troop Exit? NATO Heeds Trump's Call To Expand In Iraq

At a NATO defense meeting in Brussels this week, the alliance's Secretary General Jens Stoltenberg announced to reporters: “Allied ministers had reaffirmed their support to Iraq and agreed in principle to enhance NATO's training mission.”

However, there appears to have been little to no consultation with Baghdad over the Western military alliance "enhancing" its mission

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inside the country (or less delicately stated, expanding appears to be the reality). Pressed on this point, Stoltenberg said:

“NATO is in Iraq on the invitation of the Iraqi Government, and we will only stay in Iraq as long as we are welcome. Because NATO fully respects Iraq’s sovereignty and territorial integrity.” 

Image source: NATO

That question of "welcome" is anything but certain, after in January Iraq's parliament held a decisive early vote in favor of ousting all foreign troops, followed by weeks of popular protests and unrest which at one point saw hundreds of thousands — or as some reports said up to one million Iraqis — in the streets demanding that the US coalition get out. 

Stoltenberg further asserted that, “Everything we do will be in close consultation and coordination with the Iraqi government.”

“We are already in Iraq today and we are in consultation on the possibility of scaling up and doing more… all allies supported the decision to do more in Iraq,” he added. “In the first instance, this will consist of taking on some of the global coalition’s current training activities.”

He said: “Ministers also agreed to explore what more we can do beyond this first step.”

This does appear the crafting of an 'alternative' option for Baghdad: as opposed to the deeply unpopular beefy American presence of over 5,000 soldiers, the smaller Canadian-led mission of some 500 NATO troops which initiated their mission to train and advise Iraqis in 2018 could be a compromise alleviating the West's "security concerns" about either Iranian expansion or an ISIS resurgence. 

The White House itself could then be given political breathing space to finally leave, given that in January President Trump called on the NATO alliance to “become more involved in the Middle East".

In his Wednesday statements to reporters, Stoltenberg speculated that a mere “couple hundred” soldiers could be added to the existing mission — though again it's as yet unclear what Iraq's leaders and the people themselves think about this. 

Tyler Durden

Thu, 02/13/2020 - 21:05

Senate To Call 'Whistleblower' As Part Of Three-Pronged Investigation Into Impeachment Origins

zerohedge News senate call whistleblower part three-pronged investigation into impeachment origins All https://www.zerohedge.com   Discuss    Share
Senate To Call 'Whistleblower' As Part Of Three-Pronged Investigation Into Impeachment Origins

Senate Republicans are gearing up for a three-pronged investigation into the origins of Congressional Democrats' impeachment of President Trump, according to the Washington Examiner.

"I want to understand how all this crap started," Sen. Lindsey Graham (R-SC) on Fox News's Sunday Morning Futures, wh

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o added that the Senate would begin their investigations "within weeks."

"The Senate Intel Committee under Richard Burr has told us that they will call the whistleblower," said Graham.

Whether it's a legitimate search for the truth or a convenient way to assuage frustrated Republicans who wanted fireworks during the Senate impeachment trial has yet to be seen.

Let's recall what Senate Republicans plan to unravel;

The Whistelblower, outed by investigative reporter Paul Sperry as Eric Ciaramella, is a registered Democrat who worked for then-VP Joe Biden, former CIA Director John Brennan, and was appointed by former National Security Adviser H.R. McMaster in June, 2017 as his personal aide according to RedState. Ciaramella, who radio host Rush Limbaugh called "essentially a spy for John Brennan," was also a frequent visitor to the Obama White House.

In November, the Washington Examiner reported: "It is likely that the whistleblower traveled on Air Force Two at least one of the six visits that Biden made to Ukraine."

"If the whistleblower is a former employee of — associate of Joe Biden, I think that would be important. If the whistleblower was working with people on Schiff’s staff that wanted to take Trump down a year-and-a-half ago, I think that would be important. If the Schiff staff people helped write the complaint, that would be important. We’re going to get to the bottom of all of this to make sure this never happens again," said Sen. Graham.

After hearing second-hand about a July 25 call between President Trump and Ukrainian President Volodomyr Zelensky in which Trump asked for investigations into the Bidens, Ciaramella approached impeachment chieftain Rep. Adam Schiff (D-CA)'s office (which hired two of Ciaramella's colleagues last year, including Sean Misko, who was hired in August).

Schiff's team directed Ciaramella to "Coup has started" Democratic operative attorney Mark Zaid (who vowed to "get rid of" Trump in July of 2017), who helped the CIA 'whistleblower' file a complaint on a form which had been altered to allow hearsay.

What's more, at least two of Ciaramella's colleagues from the National Security Counsel were hired by Schiff's office last year - including Sean Misko, who was hired in August.

And Schiff continues to deny knowledge of the whistleblower's identity.

Democrats, pointing to the Trump administration placing a hold on US military aid to Ukraine, unbeknownst to Zelensky, argued that President Trump abused his office and obstructed Congress' investigation. During last week's Senate trial, Trump's attorneys argued that his actions fell far short of impeachable offense.

Tyler Durden

Mon, 02/03/2020 - 10:55




Capita unfurls new consulting arm. Hmm, what shall we call it?

logicfish Business capita unfurls consulting what shall call All https://go.theregister.co.uk   Discuss    Share
Reg's Logowatch team sad to report UK outsourcing baddie didn't get too creative

Capita is launching a consulting arm called ... err ... Capita Consulting - at least we can get behind the sensible name it chose instead of going with something like Indigo Egret or Seventh Wave.…


Academics call for UK's Computer Misuse Act 1990 to be reformed

logicfish Security academics call computer misuse 1990 reformed All https://go.theregister.co.uk   Discuss    Share
Report suggests public interest defences for infosec professionals, academics and journalists

Britain's main anti-hacker law, the Computer Misuse Act 1990, is "confused", "outdated" and "ambiguous", according to a group of pro-reform academics.…


"I'd Like To See Them Call Me": How Trump Used An Encrypted Swiss Fax Machine To Defuse The Iran Crisis

zerohedge News like them call trump used encrypted swiss machine defuse iran crisis All https://www.zerohedge.com   Discuss    Share
"I'd Like To See Them Call Me": How Trump Used An Encrypted Swiss Fax Machine To Defuse The Iran Crisis

Even as Trump was rage-tweeting on Jan 4, two days after the killing of Iran's top military leader Qassem Soleimani, that he would hit 52 targets including Iranian heritage sites for potential retaliation if America suffered losses following an Iranian attack, warning that "those targets, and Iran itself, WILL BE HIT VERY FAST AND VERY HARD", the US president w

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as busy, secretly using an encrypted back-channel to bring the world back from the brink of war.

As the WSJ reports, just hours after the U.S. strike which killed Iranian Maj. Gen. Qassem Soleimani, the Trump administration sent an urgent back channel message to Tehran: "Don’t escalate." The encrypted fax message was sent via the Swiss Embassy in Iran, one of the few means of direct, confidential communication between the two sides, U.S. officials told the WSJ. Then, in frantic attempts to de-escalate even as top US and Iranian leaders were stirring patriotic sentiment and nationalistic fervor, the White House and Iranian leaders exchanged further messages in the days that followed, which officials in both countries described as far more measured than the fiery rhetoric traded publicly by politicians.

The Swiss ambassador to Iran, Markus Leitner, here with Iranian President Hassan Rouhani in 2017, helped shuttle messages between the U.S. and Iran. Photo: Swiss embassy.

It worked: a week later, and after a retaliatory, if highly theatrical, Iranian missile attack on two military bases hosting American troops that purposefully inflicted no casualties, Washington and Tehran have stepped back from the brink of open hostilities (for now).

"We don’t communicate with the Iranians that much, but when we do the Swiss have played a critical role to convey messages and avoid miscalculation," a senior U.S. official said.

While a spokesman at Iran’s mission to the United Nations declined to comment on the exchanges, he said "we appreciate [the Swiss] for any efforts they make to provide an efficient channel to exchange letters when and if necessary." Another Iranian official said the back channel provided a welcome bridge, when all others had been burned: "In the desert, even a drop of water matters."

In retrospect, it should hardly be a surprise that the perpetually neutral Swiss were the last recourse to prevent potential war.

As the WSJ notes, from the Swiss Embassy, a Shah-era mansion overlooking Tehran, the country’s role as a diplomatic intermediary has stretched through four turbulent decades and seven presidencies, from the hostage crisis under Jimmy Carter to Barack Obama’s nuclear deal. But it was seldom tested like this.

Here's how it happened.

The first American fax was sent immediately after Washington confirmed the death of Soleimani, the most important figure in Iran’s Islamic Revolutionary Guard Corps, the U.S. officials said. It arrived on a special encrypted fax machine in a sealed room of the Swiss mission - the most enduring, and secret, method since the 1979 Islamic Revolution - for the White House to exchange messages with Iran’s top leadership, especially when the two nations are concurrently parading in public media in their bellicose propaganda to earn political brownie points.

The equipment operates on a secure Swiss government network linking its Tehran embassy to the Foreign Ministry in Bern and its embassy in Washington, say Swiss diplomats. Only the most senior officials have the key cards needed to use the equipment.

Early on Friday morning, just hours after Soleimani's death, Swiss Ambassador Markus Leitner, a 53-year-old career diplomat, delivered the American message by hand to Iranian Foreign Minister Javad Zarif. Predictably, Zarif responded to the U.S. missive with anger, according to a WSJ source: "[U.S. Secretary of State Mike] Pompeo is a bully,” he said, according to one U.S. official briefed on Zarif’s response. “The U.S. is the cause of all the problems."

The US may indeed be the cause of all the problems, but it also has all the weapons, and despite the pompous rhetoric, Iran knew full well it could not hope to escalte in tit-for-tat fashion without risking virtually everything. Which is why, Iran was quick to take advantage of Leitner's mediation.

The Swiss ambassador - who regularly visits Washington for closed-door sessions with Pentagon, State Department and intelligence officials eager to tap his knowledge about Iran’s opaque and fluid politics - spent the next several days after Soleimani’s killing shuttling back and forth in a low-key but high-wire diplomatic mission designed to let each side speak candidly. It was a vivid contrast to the jabs of President Trump and Mr. Zarif on Twitter.

Shortly after Trump tweeted on Jan 4 that the US had picked 52 Iranian targets for eventual escalation, Zarif responded just as belligerently on the next day: "A reminder to those hallucinating about emulating ISIS war crimes by targeting our cultural heritage," he wrote. "Through MILLENNIA of history, barbarians have come and ravaged our cities, razed our monuments and burnt our libraries. Where are they now? We’re still here, & standing tall."

However, at the same time as Zarif was seeking to emulate Trump's twitter bluster, the Iranian foreign minister called the Swiss ambassador to take a message to the U.S. It was more restrained, and subsequent statements from both sides helped prevent miscalculations, the officials said.

“When tensions with Iran were high, the Swiss played a useful and reliable role that both sides appreciated,” said a senior Trump administration official. "Their system is like a light that never turns off." Unlike Twitter, that is, which has emerged a medium for spreading premeditated, fake, outrage to mass consumption and whose sole purpose is to distract from what is truly happening behind the scenes.

It's not the first time the Swiss have helped pull back the middle east from the brink of mushroom clouds: they have served as messengers between Washington and Tehran since 1980, in the wake of the seizure of the American Embassy—and 52 hostages —in Tehran by Iranian revolutionaries. Swiss diplomats call the role the “brieftrager” or “the postman.”

In the years after the U.S.-led invasion of Iraq in 2003, the Swiss shepherded messages to help avoid direct clashes. When President Obama assumed office, Switzerland hosted the talks that led to a nuclear deal. When Washington lifted sanctions, Swiss businesses had an early jump on rivals.  When Trump reimposed sanctions, he gave the Swiss a phone number to pass the Iranians, saying: “I’d like to see them call me.”

So far, Tehran has continued to speak through the Swiss.

* * *

Why has this archaic method of communication proven so effective at pulling the world back from the edge of crisis?

Former Swiss ambassadors say the diplomatic channel is effective because the U.S. and Iran can trust a message will remain confidential, be delivered quickly, and will reach only its intended recipients. Statements passed on the back channel are always precisely phrased, diplomatic, and free of emotion, something which is clearly impossible on Trump's favorite social media platform, twitter, which he uses for precisely the opposite purpose: to spark outrage and to appeal to base emotions of his core supporter group.

Switzerland, a landlocked country of nine million with no standing army where everyone owns a gun, parlays its role as the world's neutral "postman" (and until recently, secret banker) to lever access to the great powers.

And speaking of Swiss bank, the WSJ notes that currently Swiss diplomats are working to get Washington’s green light for Swiss banks to finance exports to Iran that aren’t subject to sanctions—like food and medicine. "We do things for the world community, and it’s good," said a former ambassador. “But it is also good for our interests." Of course it is: for the privilege of funding the most basic human needs, those same Swiss banks can charge exorbitant rates of interest in a country that for years has had a negative official interest rate.

Iran isn’t the only geopolitical hot spot where the Swiss Embassy represents U.S. or other countries’ interests after the breakdown of diplomatic relations: the Swiss now holds six mandates including representing Iran in Saudi Arabia, Georgia in Russia and Turkey in Libya and the U.S. in Cuba according to the WSJ. In April 2019, the Trump administration asked Bern to represent it in Venezuela but President Nicolás Maduro’s government has yet to approve.

And so, if the world has any hope of avoiding an all out war between US and Iran, it will have to go through Bern, at least figuratively. As tensions between Washington and Tehran have escalated, the Swiss backchannel has remained active. In December the two countries released prisoners at the same time at a special hangar in the Zurich airport - U.S. special envoy on Iran Brian Hook and Iran’s Zarif sat in separate rooms as the Swiss directed the carefully choreographed exchange.

"The Swiss channel has become enormously important because of what they can do in the short term to lessen tensions,” said former New Mexico Gov. Bill Richardson, who worked with the Swiss on the prisoner exchange. “It’s the only viable channel right now."

Tyler Durden

Fri, 01/10/2020 - 21:11




Rand Paul Roasts Pelosi, 'Butt-Dialing' Rudy, And Trump's 'Perfect' Call In 2019 Festivus Rant

zerohedge News rand paul roasts pelosi butt-dialing rudy trumps perfect call 2019 festivus rant All https://www.zerohedge.com   Discuss    Share
Rand Paul Roasts Pelosi, 'Butt-Dialing' Rudy, And Trump's 'Perfect' Call In 2019 Festivus Rant

Senator Rand Paul (R-KY) is out with his 2019 "Festivus" Tweetstorm - roasting Washington DC with a tradition from the Seinfeld-created holiday's "Airing of Grievances."

Last year, Paul roasted Elizabeth Warren, Jared Kushner and Ted Cruz - and had a few suggestions for Trump's border wall.

This year, the K

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entucky Senator opines on impeachment, Adam Schiff, and government waste.

See below:

Tyler Durden

Mon, 12/23/2019 - 17:25




Why China's CFA Applicants Call The Test "Pleasant" As Pass Rates Rise Significantly

zerohedge News chinas applicants call test pleasant pass rates rise significantly All https://www.zerohedge.com   Discuss    Share
Why China's CFA Applicants Call The Test "Pleasant" As Pass Rates Rise Significantly

Everybody on Wall Street knows that the CFA is one of the most grueling tests on the street. The CFA designation after a person's name bestows upon them an assumption of a fluent understanding of economics, derivatives, complex valuations and ethics.

The CFA Institute warns that each of the three levels of the exam takes about 300 hours of studying to pass, acco

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rding to Bloomberg. Many who seek out the CFA designation spend years studying, taking and retaking the tests. 

The test's difficulty is why the CFA pass rate, despite ticking up slightly over the past few years, still remains below 50%. 

But in recent years, a curious trend has appeared. Test takers from China have seen their pass rate rise significantly, despite the language barrier. Applicants from Asia, and especially China, have been "flooding" into the exams, overtaking interest from all other regions. 

One of the reasons for this is that many people in China consider the CFA a cool-down exercise after taking the Gaokao, China's infamous college entrance exam. A work ethic bar had already been set, and many applicants did not mind spending "much more" than 300 hours studying for the CFA. 

Ranger Yu, who described the CFA test as "pleasant" after studying 18 hour days for the Gaokao, says that "diligence is key" to getting ahead in China's financial industry. He made time to study before and after work and spent weekends in the library or in all-day class at Golden Education, one of the country's largest CFA prep schools. Many of these schools tout pass rates of 70% or 80%, far exceeding the average global pass rate of about 45%. 

Golden Education charges about $1,500 for its program and it starts with a "crash course" on financial English. 

Niu Jia, a senior lecturer for the school’s CFA program said: “We have the language barrier. But there are also other challenges for Chinese test-takers. The exam relies on accounting principles and valuation models that sometimes differ than those most often taught in universities.”

The school assigns every customer an "inspector" to track their progress (and who even prepares a lunch on exam day). ZBG Education, another school that's based on Guangzhou, offers 15 day camps with weekend classes and online courses. They claim a 70% pass rate and recommend 400 hours of studying, instead of the normal 300.

Jason Pi, a senior lecturer at ZBG said: “Most of the CFA takers are top students in China. For most of my students, a few hundred hours is really not a big commitment. It’s nothing compared with the efforts you need to make to squeeze in a top university in China.”

Nick Pollard, Asia-Pacific managing director for the CFA institute, said: “We encourage candidates to use approved prep-providers, and we provide information about how to select and research a prep-provider to meet a candidate’s learning needs on our website. CFA Institute publishes average passing rates every year, and candidates should use this information as their best guide to what is generally achievable.”

China's Gaokao test, formerly called the National College Entrance Examination, has been the subject of documentaries on the suffering it causes its test takers, with some students suffering from mental breakdowns, or even suicide.

The test is administered over several days and spans a "broad range of subjects". A sample question from the test published in 2015 asked students about the currents and wind direction if they were sailing from Fujian province to Venice, and then to Mumbai. 

Priscilla Wang, who works at a credit rating agency in Hong Kong, said: “I had no time for fun. I had to say ‘no’ to a lot of socializing opportunities. Even when I did relax a bit, my heart was always heavy. I thought I should be studying.”

Tyler Durden

Sat, 12/21/2019 - 16:00




If there's somethin' stored in a secure enclave, who ya gonna call? Membuster!

logicfish Security theres somethin stored secure enclave gonna call membuster All https://go.theregister.co.uk   Discuss    Share
Boffins ride the memory bus past Intel's SGX to your data

Computer scientists from UC Berkeley, Texas A&M, and semiconductor biz SK Hynix have found a way to defeat secure enclave protections by observing memory requests from a CPU to off-chip DRAM through the memory bus.…


Zelensky "Loves Your Ass": Hearsay-Gate Intensifies Over Trump-Sondland Call

zerohedge News zelensky loves your hearsay-gate intensifies over trump-sondland call All https://www.zerohedge.com   Discuss    Share
Zelensky "Loves Your Ass": Hearsay-Gate Intensifies Over Trump-Sondland Call

House Democrats have teed up their next 'gotcha' that will surely bring down Trump; a US official overheard a phone call between the president and his top diplomat in Europe in which Trump was told that the president of Ukraine "loves your ass" - after which Trump, whose voice carries, asked "So he's gonna do the investigation?"

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Pack it up boys, Trump's done!

Overheard by US Embassy in Ukraine official David Holmes, the alleged conversation took place just one day after the infamous July 25 phone call at the heart of the impeachment, in which President Trump politely asked Zelensky to investigate the Bidens and political matters relating to the 2016 US election.

What's more, Holmes salts the geopolitical wound - suggesting Trump is simply grabbing Ukraine by the pussy and doesn't actually care about the country.

According to Holmes, Sondland replied “he’s gonna do it,” adding that Zelenskiy will do “anything you ask him to.”

Holmes said he later asked Sondland if the president cared about Ukraine, and Sondland said Trump did not “give a s--- about Ukraine.

“I asked why not, and Ambassador Sondland stated that the president only cares about ‘big stuff,’” Holmes testified, according to the document posted by CNN. “I noted that there was ‘big stuff’ going on in Ukraine, like a war with Russia, and Ambassador Sondland replied that he meant ‘big stuff’ that benefits the president, like the ‘Biden investigation.”’ -Bloomberg

Hear that Volodomyr?

Holmes told House Investigators this latest tidbit of 'damning hearsay' in a closed-door session Friday (which was promptly leaked). Now, the State Department employee is now set to peddle this latest scandal du jour in public testimony next week.

Why is it a "gotcha?" According to Bloomberg the conversation, held in an open-air restaurant on an unsecured phone (another gotcha) - "could yield the most direct evidence yet that the president himself pressured a foreign power to conduct politically motivated investigations."

This, despite an actual transcript of the phone call revealing no such 'pressure,' and Zelensky publicly saying the same. And now we learn Zelensky 'loves Trump's ass,' which would suggest Trump wouldn't have to apply pressure at all.

As Democrats continue to frame Trump's investigation requests as impeachable election meddling - a 'high crime and misdemeanor' - nobody seems to care about getting to the bottom of what the Bidens did in Ukraine.

Tyler Durden

Sat, 11/16/2019 - 12:00




'Nothing Illegal In Trump-Zelensky Call': NSC Official Tells Impeachment Inquiry

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'Nothing Illegal In Trump-Zelensky Call': NSC Official Tells Impeachment Inquiry

A top National Security Council official who quit the day before his testimony told Congressional investigators on Thursday that he does not believe Trump discussed anything illegal with Ukrainian President Volodomyr Zelensky according to The Federalist.

Tim Morrison

"I want to be clear, I was not conc

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erned that anything illegal was discussed," said Tim Morrison, former NSC Senior Director for European Affairs who was on the July 25 call between the two leaders.

Morrison also testified that the transcript of the phone call which was declassified and released by the White House "accurately and completely reflects the substance of the call."

Morrison testified that Ukrainian officials were not even aware that certain military funding had been delayed by the Trump administration until late August 2019, more than a month after the Trump-Zelensky call, casting doubt on allegations that Trump somehow conveyed an illegal quid pro quo demand during the July 25 call.

I have no reason to believe the Ukrainians had any knowledge of the [military funding] review until August 28, 2019,” Morrison said. That is the same day that Rep. Adam Schiff, D-Calif., the chief anti-Trump inquisitor in the U.S. House of Representatives, disclosed on Twitter that funding had been held up. Politico also published a story that day, sourced to anonymous leaks, that military funding had been temporarily held up. -The Federalist

Last week, Morrison was named during testimony earlier this month by William Taylor, Trump's top envoy to Ukraine, according to Politico.

William Taylor

As we reported earlier today of Morrison, following the call, Morrison informed Taylor that it "could have gone better," and that Trump suggested Zelensky and his staff meet with Trump's personal attorney Rudy Giuliani and Attorney General William Barr.

Morrison's hawkish views align with those of Bolton and he has been described as a creature of process by some close to him.

Bolton always told those who worked for him that process was their protector and sometimes you have to listen to the person elected -- advice Morrison adopted, sources said.

Morrison is a lifelong Republican described as a Reaganite and is referred to as "'Bolton's Bolton,' he is really hard right," according to one source familiar with Morrison. -CNN

"The NSC process does not allow anything that isn't legal. It just, it would never get to the President. Certainly not any process that Tim was ever a part of," said one source close to Morrison. "A piece of paper does not get to the national security adviser without first going through the lawyers, much less to the President."

Taylor also said that Morrison witnessed Trump Ally Gordon Sondland convey a quid pro quo arrangement;

Taylor also described a conversation in which Morrison relayed word from Sondland that Trump had told Sondland directly that Ukraine President Volodymyr Zelensky should publicly announce the investigations.

House impeachment investigators are exploring whether Trump conditioned nearly $400 million in military aid to Ukraine — and a White House visit for Zelensky — on Ukraine's willingness to investigate former Vice President Joe Biden, as well as a debunked theory that Ukraine, not Russia, interfered in the 2016 U.S. elections.

Taylor told lawmakers that Morrison relayed concerns about Trump's posture toward Ukraine to then-national security adviser John Bolton and to NSC lawyers. -Politico

According to Morrison, the national security process worked as designed.

"I am pleased our process gave the president the confidence he needed to approve the release of the security sector assistance," he said, adding "I am proud of what I have been able, in some small way, to help the Trump administration accomplish."

Earlier Thursday, House Democrats (all but two) approved impeachment procedures against President Trump. No Republicans voted for the measure.

Tyler Durden

Thu, 10/31/2019 - 13:40


Human Interest


Europe's digital identity system needs patching after can_we_trust_this function call ignored

logicfish Security europes digital identity system needs patching after can_we_trust_this function call ignored All http://go.theregister.com   Discuss    Share
ExplicitKeyTrustEvaluator... True, false? Who cares, just accept it anyway

Security flaws have been found in the European Union's electronic identity system that could have been exploited by miscreants to impersonate member states' citizens online.…


Pelosi Flat-Out Lies; Claims Schiff Used 'Trump's Own Words' In Fabricated Ukraine Call 'Parody'

zerohedge News pelosi flat-out lies claims schiff used trumps words fabricated ukraine call parody All https://www.zerohedge.com   Discuss    Share
Pelosi Flat-Out Lies; Claims Schiff Used 'Trump's Own Words' In Fabricated Ukraine Call 'Parody'

House Speaker Nancy Pelosi (D-CA) lied on Wednesday when she told ABC News's George Stephanopoulos that House Intelligence Committee Chairman Rep. Adam Schiff (D-CA) "was using the president's own words" when he read a fabricated account of a phone call between President Trump and Ukrainian President Volodomyr Zelensky during a hearing last w

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eek with the acting director of national intelligence. 

Stephanopoulos pushed back, telling Pelosi "Well those weren't the president's words, it was an interpretation of the president's words. They're saying he made this up," to which Pelosi replied "He did not make it up." 

To be clear, Nancy Pelosi doesn't appear to have a full grasp on what she's impeaching Trump over.

Schiff compared Trump's call with Zelensky as a "classic organized crime shakedown" in his opening remarks last week. "Shorn of its rambling character and in not so many words, this is the essence of what the president communicates," Schiff added, before launching into his fabricated 'parody' of the call. 

Schiff's fabrication: 

"We’ve been very good to your country, very good," Schiff says, doing a terrible impression of Trump. "No other country has done as much as we have, but you know what? I don’t see much reciprocity here. I hear what you want, I have a favor I want from you, though, and I’m gonna say this only seven times, so you better listen good. I want you to make up dirt on my political opponent, understand, lots of it."

In response, President Trump called Schiff a "lowlife" who should "resign and be investigated." 

Trump expanded on Schiff during Wednesday comments:

Rep. Andy Biggs (R-AZ) introduced a resolution censuring Schiff for his remarks, saying in a Twitter video that the California Democrat "read a statement that was blatantly false, had no corresponding evidence, nor relationship to the actual transcript of President Trump's conversation," adding "What the chairman did is he read something that was made-up, totally false, and later had to excuse it by saying it was a parody."

GOP leader Kevin McCarthy, meanwhile, tweeted "Chairman Adam Schiff has been lying to the American people for years. Now he is so desperate to damage the president that he literally made up a false version of a phone call."

Tyler Durden

Thu, 10/03/2019 - 12:05




"They Call That A Payoff": Trump Says China Should Investigate Bidens Over 'Billions' Taken Out Of Country

zerohedge News they call that payoff trump says china should investigate bidens over billions taken country All https://www.zerohedge.com   Discuss    Share
"They Call That A Payoff": Trump Says China Should Investigate Bidens Over 'Billions' Taken Out Of Country

President Trump on Thursday said that China should "start an investigation into the Bidens," telling reporters "what happened in China is just about as bad as what happened with Ukraine." 

Trump then added, "I'm sure that President Xi does not like being under that kind of scrutiny, where billions of dollars is taken out of his country by a guy that just got kicked out of the Navy. He got kicked out of the Navy, all of the sudden he's getting billions of dollars. You know what they call that? They call that a payoff.

To recap, journalist Peter Schweizer claims that in 2013 then-Vice President Joe Biden and his son Hunter flew to China together on Air Force Two

Two weeks later, Hunter's investment firm inked a $1.5 billion private equity deal with a subsidiary of the state owned Bank of China. 

"If it sounds shocking that a vice president would shape US-China policy as his son — who has scant experience in private equity — clinched a coveted billion-dollar deal with an arm of the Chinese government, that’s because it is" -Peter Schweizer via the New York Post

As we noted in May, here's what we know: 

  • Hunter Biden and his partners created several LLCs involved in multibillion-dollar private equity deals with Chinese government-owned entities. 

  • The primary operation was Rosemont Seneca Partners - an investment firm founded in 2009 and controlled by Hunter Biden, John Kerry's stepson Chris Heinz, and Heniz's longtime associate Devon Archer. The trio began making deals "through a series of overlapping entities" under Rosemont. 

  • In less than a year, Hunter Biden and Archer met with top Chinese officials in China, and partnered with the Thornton Group - a Massachusetts-based consultancy headed by James Bulger - son of famed mob hitman James "Whitey" Bulger. 

  • According to the Thornton Group's Chinese-language website, Chinese executives "extended their warm welcome" to the "Thornton Group, with its US partner Rosemont Seneca chairman Hunter Biden (second son of the now Vice President Joe Biden." 

  • Officially, the China meets were to "explore the possibility of commercial cooperation and opportunity," however details of the meeting were not published to the English-language version of the website. 

  • "The timing of this meeting was also notable. It occurred just hours before Hunter Biden’s father, the vice president, met with Chinese President Hu Jintao in Washington as part of the Nuclear Security Summit," according to Schweizer. 

  • Perhaps most damning in terms of timing and optics, just twelve days after Hunter and Joe Biden flew on Air Force Two to Beijing, Hunter's company signed a "historic deal with the Bank of China," described by Schweizer as "the state-owned financial behemoth often used as a tool of the Chinese government." To accommodate the deal, the Bank of China created a unique type of investment fund called Bohai Harvest RST (BHR). According to BHR, Rosemont Seneca Partners is a founding partner

It was an unprecedented arrangement: the government of one of America’s fiercest competitors going into business with the son of one of America’s most powerful decisionmakers.

Chris Heinz claims neither he nor Rosemont Seneca Partners, the firm he had part ownership of, had any role in the deal with Bohai Harvest. Nonetheless, Biden, Archer and the Rosemont name became increasingly involved with China. Archer became the vice chairman of Bohai Harvest, helping oversee some of the fund’s investments. -New York Post

National Security implications

As Schweizer also notes, BHR became an "anchor investor" in the IPO of China General Nuclear Power Corp (CGN) in December 2014. The state-owned energy company is involved with the construction of nuclear reactors. 

In April 2016, CGN was charged by the US Justice Department with stealing nuclear secrets from the United Stateswhich prosecutors warned could cause "significant damage to our national security." CNG was interested in sensitive, American-made nuclear components that resembled those used on US nuclear submarines, according to experts. 

More China dealings

It doesn't stop there. While Hunter Biden had "no experience in China, and little in private equity," the Chinese government for some reason thought it would be a great idea to give his firm business opportunities instead of established global banks such as Morgan Stanley or Goldman Sachs. 

Also in December 2014, a Chinese state-backed conglomerate called Gemini Investments Limited was negotiating and sealing deals with Hunter Biden’s Rosemont on several fronts. That month, it made a $34 million investment into a fund managed by Rosemont.

The following August, Rosemont Realty, another sister company of Rosemont Seneca, announced that Gemini Investments was buying a 75 percent stake in the company. The terms of the deal included a $3 billion commitment from the Chinese, who were eager to purchase new US properties. Shortly after the sale, Rosemont Realty was rechristened Gemini Rosemont.

Chinese executives lauded the deal. -New York Post

"Rosemont, with its comprehensive real-estate platform and superior performance history, was precisely the investment opportunity Gemini Investments was looking for in order to invest in the US real estate market," said Li Ming, chairman of Sino-Ocean Land Holdings Limited and Gemini Investments. "We look forward to a strong and successful partnership."

That partnership planned to use Chinese money to scoop up US properties. 

"We see great opportunities to continue acquiring high-quality real estate in the US market," said one company executive, who added: "The possibilities for this venture are tremendous." 

Then, in 2015, BHR partnered with a subsidiary of Chinese state-owned military aviation contractor Aviation Industry Corporation of China (AVIC) in order to purchase American precision-parts maker Henniges - a transaction which required approval from the Committee of Foreign Investment in the United States (CFIUS), the same rubber-stamp committee that approved the Uranium One deal. 

Tyler Durden

Thu, 10/03/2019 - 11:15


Business Finance


"It’s Almost Impossible To Buy": Japanese Bond Crash, Margin Call Send Shockwaves Around The Globe

zerohedge News almost impossible japanese bond crash margin call send shockwaves around globe All https://www.zerohedge.com   Discuss    Share
"It’s Almost Impossible To Buy": Japanese Bond Crash, Margin Call Send Shockwaves Around The Globe

For a dramatic preview of what will happen in the blink of an eye to all those record low interest rates without the backstop of central banks and ravenous pension fund buying, look no further than what happened in Japan overnight where bond futures suffered the biggest one-day crash since August 2, 2016, sliding as much as 0.97 yen to 154.

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05, and triggering margin calls for investors after the worst 10-year debt auction in three years.

More ominously, once the rout started it quickly spread outside of Japan, because as yields jumped, the sell-off spilled into US Treasuries and European debt.

There were three things behind the swift collapse: the first catalyst was the Bank of Japan’s Monday decision to slash bond purchases in October for the four major maturity buckets in order to steepen the curve and avoid further flattening which Kuroda has repeatedly expressed concern about in the past; the BOJ had indicated it may even stop buying debt of more than 25 years. It also sought to anchor yields from the one-to-three year zone by raising purchases in a regular operation earlier in the day and lifting the purchase band for the sector in October.

"The BOJ is showing its clear intention to correct distortions in the curve through flexible adjustments in market operations,” said Mari Iwashita, chief market economist at Daiwa. "While cutting the lower end of purchases in bonds maturing over 25 years to zero looks shocking, the BOJ will probably cut buying in this zone slowly."

"The BOJ’s operation change had a huge psychological impact,” said Eiji Dohke, chief bond strategist at SBI Securities in Tokyo. “Investors are reluctant to buy given the risk of the BOJ skipping a purchase."

Then, there was the announcement early on Tuesday morning by Japan's Government Pension Investment Fund (GPIF) that it was pivoting toward buying more FX-hedged foreign debt. Specifically, the world’s largest pension fund said it will consider currency-hedged overseas bond holdings as similar to domestic debt investments. That would allow GPIF to buy more foreign debt, as it’s already close to the 19% limit in its current mandate; and while good news for US Treasurys this was bad news for local JGBs.

Takahiro Sekido, a strategist at MUFG Bank, estimated that the GPIF may allocate more than 30% of its existing JGB holdings to currency hedged-foreign bonds: “There could be many funds following GPIF’s allocation change,” said Sekido, a former BOJ official.

As it turned out, he was right, and as Bloomberg put it, "all of a sudden, investors were left wondering what other changes were in store."

Third and final, and the cherry on top, came just a few hours later when the latest 10-year JGB auction confirmed the investor panic as the debt drew a bid-to-cover ratio of 3.42, the lowest since 2016, while the 0.29 tail was widest since March 2015.

If Japan can ever have a failed bond auction, this was about as close to it as it could get.

The "auction results were much worse than expected amid increased caution after the BOJ cut bond purchases on Monday", says Eiji Dohke, chief bond strategist at SBI Securities in Tokyo. He noted that the "results reflect caution that the central bank may refrain from buying bonds during one of its regular operations in October" and said that given the weak outcome of Tuesday’s sale, JGB volatility is likely to remain elevated until the BOJ’s policy meeting at month-end and investors will be wary about taking positions.

Following this three-peat of doom for bond bulls, yields on Japan’s 10-year cash bond rose 5.5 basis points to minus 0.16%. The heavy selling sparked a margin call at the Japan Securities Clearing Corp, which then drove prices even lower in a second acute selloff about two hours later.

Tuesday's rout was merely the latest hit for Japanese sovereign bonds, which were already reeling from a dismal September, when they lost 1.1%, their first monthly drop since April.

And as JGBs dumped, so did Bunds and US Treasurys in a coordinated global move that saw yields in the US and German both spike as a result of tremors started in little, old Japan, confirming that once the central banks lose control, the collapse will be quick and painful (this is for all you MMT watchers out there).

Summarizing this ominous day for Japan's bond market - and economy - MUFG Bank's Takahiro Sekido put it best: "Japanese bonds have reached the point where it’s almost impossible to buy."

For the sake of Japan, the global bond market, and the entire global financial system, he better be wrong.

Tyler Durden

Tue, 10/01/2019 - 07:33


Business Finance


NYC Bans Calling Someone An "Illegal Alien", Threatening To Call ICE "When Motivated By Discrimination"

zerohedge News bans calling someone illegal alien threatening call when motivated discrimination All https://www.zerohedge.com   Discuss    Share
NYC Bans Calling Someone An "Illegal Alien", Threatening To Call ICE "When Motivated By Discrimination"

Authored by Janita Khan via The Epoch Times,

New York City can now fine residents up to $250,000 if they refer to someone as an “illegal alien” or threaten to call U.S. Immigration and Customs Enforcement (ICE) on someone “when motivated by discrimination.”

The NYC Commiss

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ion on Human Rights announced on Sept. 26 that they had released a new legal enforcement guideline (pdf) that clarifies discrimination based on someone’s immigration status and national origin is illegal in any public accommodations, employment, and housing. According to the guidance, public accommodations include “businesses such as restaurants, fitness clubs, stores, and nightclubs, and other public spaces, like parks, libraries, healthcare providers, and cultural institutions.”

Any violations of the law could be fined up to $250,000.

“This new legal enforcement guidance will help ensure that no New Yorker is discriminated against based on their immigration status or national origin,” said Deputy Mayor Phil Thompson in a press release on Sept. 26.

Under the guidance, phrases such as “illegal alien,” and “go back to your country” used with the intent to “demean, humiliate, or harass” a person is illegal under the law. Moreover, it states that harassing or discriminating a person based on their use of another language or their limited English proficiency is also against the law.

In its 29-page directive, the commission lists several examples as to what would constitute a violation of the law, which includes harassing people based on their immigration status or discriminating someone based on their accent.

“An immigrant shop owner asks a couple of customers to leave his store after they start breaking merchandise. The customers tell the owner he should ‘go back to where he came from,’ and exit the shop. The next morning, the owner discovers that the windows have been smashed and the walls spray-painted with anti-immigrant obscenities,” one example said.

“An employer interviews a highly qualified applicant for a new position. Upon hearing the applicant’s accent, the employer decides not to hire them, assuming that their accent indicates that the applicant is not very smart,” another example states.

This comes after Mayor Bill de Blasio expressed opposition to a nationwide ICE enforcement operation targeting illegal immigrants who have received final deportation orders issued by immigration judges.

Carmelyn Malalis, the agency’s commissioner, told the New York Post that the new guidelines were partly made in response to a crackdown on illegal immigration by the federal government.

“In the face of increasingly hostile national rhetoric, we will do everything in our power to make sure our treasured immigrant communities are able to live with dignity and respect, free of harassment and bias,” Malalis told the newspaper.

Federal immigration officials have reported record highs in the apprehension of illegal immigrants at the border to Congress in the past months, saying that the numbers have overwhelmed border patrol facilities and resources. In May, border patrol agents apprehended or deemed inadmissible over 144,000 people crossing from Mexico—which were record-high numbers. The number of people apprehended or deemed inadmissible has been steadily falling after President Donald Trump pushed Mexico, through the threat of tariffs, to put more focus on the humanitarian crisis.

According to the city, 37 percent of the city’s population was born outside the United States, meanwhile, 16 percent of the population are noncitizens. New York City is also a sanctuary city, which refers to a city that limits its cooperation with ICE to enforce immigration law.

Tyler Durden

Sun, 09/29/2019 - 12:00


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