“Fiat-money! Let the State 'create' money, and make the poor
rich, and free them from the bonds of the capitalists! How foolish to forego
the opportunity of making everybody rich, and consequently happy, that the
State's right to create money gives it! How wrong to forego it simply because
this would run counter to the interests of the rich! How wicked of the
economists to assert that it is not within the power of the State to create
wealth by means of the printing press!- You statesmen want to build railways,
and complain of the low state of the exchequer? Well, then, do not beg loans
from the capitalists and anxiously calculate whether your railways will bring
in enough to enable you to pay interest and amortization on your debt. Create
money, and help yourselves.”
Ludwig von Mises, The
Theory of Money and Credit
This
long weekend, an oldie but goodie. A reminder of how the central bankster
rigged world really operates on the Great Nixonian Error of fiat money.
But
first this. In America, the new Republican tax changes look likely to be
disruptive to the global economy but positive to the US economy. But can
European banking handle the tax changes?
Whatever it is that the government does, sensible Americans
would prefer that the government do it to somebody else. This is the idea
behind foreign policy.
P J O’Rourke
IRS Issues Tax Rate Guidance for Stockpiled Foreign Income
By Lynnley Browning
Updated on 29 December 2017, 22:39 GMT
The Internal Revenue Service and Treasury Department
will generally allow existing loans and other related-party transactions
involving the overseas affiliates of multinational corporations to be taxed at
the lower of two preferential rates, according to an official notice.
The notice, released Friday afternoon, says the IRS and Treasury “intend
to issue” new regulations clarifying how multinational companies must compute
tax bills on the foreign earnings they have accumulated to date.
The tax-overhaul bill signed last week by President Donald Trump
requires companies to pay taxes on those earnings at two discounted rates --
15.5 percent on income held as cash and cash equivalents and 8 percent for
illiquid assets. Those rates apply to an estimated $3.1 trillion in earnings
stockpiled overseas since 1986.
The 22-page guidance notice from the two federal agencies discusses how
authorities plan to define the two types of income. It also addresses how U.S.
companies with ownership stakes in certain foreign corporations must tally up
the earnings that will be subject to the tax rates when the U.S. entity and the
foreign entity have different taxable years. And the new rules will “avoid
double counting and double non-counting of earnings” subject to the new tax
rates, according to the notice.
The changes come as the U.S. is transitioning away from its previous
international tax system as part of the Republican tax-overhaul plan.
Previously, U.S. authorities applied a 35 percent tax rate to companies’
earnings globally, but allowed them to defer paying taxes on offshore income until
they returned it -- or “repatriated” it -- to the U.S. As a consequence,
companies have accumulated years’ worth of profits offshore.
More
In
Europe, Spain carries on digging its hole. Italy carries on being Italy. An
unreformable EUSSR heads towards the fate of its mentor the USSR or the earlier
Tower of Babel.
Rajoy Says Spain Won't Yield to Blackmail by Catalan Separatists
By Charles Penty
Spanish Prime Minister Mariano Rajoy set in motion the
process for convening a new Catalan parliament and said he wouldn’t allow a new
separatist administration to blackmail his government.
A session to swear in lawmakers in Barcelona will take place on Jan. 17 before a vote days later to appoint a new regional president if there is a candidate, Rajoy said in an end-of-year news conference in Madrid.
Rajoy dissolved the Catalan parliament in October after drawing on emergency constitutional powers to respond to a unilateral declaration of independence from Spain. Elections held last week in the region produced a majority for parties that support independence in a result that threatens to prolong a secession crisis that is damaging Spain’s economy.
----Choosing a president for Catalonia won’t be easy for the pro-independence parties with former President Carles Puigdemont in Brussels avoiding arrest and his former deputy, Oriol Junqueras, already in jail. A Supreme Court judge is investigating whether the campaign to split from Spain amounted to a rebellion against the government.
Rajoy said his most pressing task for the start of the year would be the
need to build consensus for his minority government to pass a budget for 2018.
Why Much Is at Stake in Italy's March 4 Elections
By John Follain and Chiara Albanese
Italy’s all-too-familiar postwar brew of government
dysfunction, economic stagnation and toxic debt has investors worried again,
even as the specter of populist revolt recedes elsewhere in Europe. The next
parliamentary elections in the euro region’s third-biggest economy, now
scheduled for March 4, will test stress points including the country’s
ambivalent relationship with the single currency, its towering debt and a
troubled banking system still trying to dispose of decade-old poisonous
holdings.
It will be a crucial test for the anti-establishment,
euroskeptic Five Star Movement, especially since
a new electoral law encourages parties to
build alliances. Five Star is challenging the ruling center-left Democratic
Party of Prime Minister Paolo Gentiloni. So is a possible center-right coalition of the Forza
Italia party of ex-premier Silvio Berlusconi, the euroskeptic and
anti-migrant Northern League and the small, far-right Brothers of Italy; that
bloc won regional elections in Sicily in November. But polls have shown that
none of these three groups may have the support to win a parliamentary majority
on its own. So the elections could end up with a hung parliament, lingering
uncertainty, and a reappointment of Gentiloni until fresh elections.
3. How are markets taking the news?
Tension is building, with yield on 10-year government bonds, known as BTP, rising above 2 percent for the first time since Oct. 26. Markets are concerned not just by the prospect of a hung parliament, but also by Five Star’s inexperience at the national level and a possible referendum on Italy’s membership of the euro area. Five Star’s program for government includes overhauling banks and breaking up the European Stability Mechanism and the troika that oversaw bailouts from Greece to Ireland. Add to that worries about how Italy could suffer from an end to the European Central Bank’s quantitative easing program.
More
Italy is not technically part of the Third World, but no one has
told the Italians.
P J O’Rourke
Now
back to how the modern world turns, in our ever more corrupt system operating
on fiat money, communist money.
….shall be the truth, the whole truth and nothing but the truth.
Spies, lies and the oligarch: inside London’s booming secrets industry
-----The industry’s currency is secrets. Its services
range from tracing fraudsters’ assets to darker arts that include hacking,
infiltration, honey traps, blackmail and kidnapping. On the front line are the
private intelligence agencies. Some of them have benefited from the growth in
outsourcing by the law enforcement and spy agencies of the US and its allies —
the source, Wahid says, of almost all Arcanum’s work. But many firms have
amassed expertise and tradecraft once monopolised by state agencies and put it
at the service of tyrants, oligarchs and anyone else willing to pay. Their
critics say they have no friends, only invoices, but many in the business see
themselves as soldiers of justice in a globalised world, filling a vacuum left
by enfeebled states and cash-strapped, antiquated law enforcement. The industry
is concentrated in the west because that is where the money is. Since the end
of the cold war, the offshore system has helped a growing cohort of kleptocrats
and their cronies to channel dubious fortunes into western markets. Officials
in western Europe and North America say billions of dollars in dirty money pour
in each year, mainly through assets such as real estate.
London, long a city of
secrets, is the industry’s capital. Many firms have taken offices in Mayfair,
the exclusive, cosmopolitan quarter where wealth and politics mix.
The Ablyazov case mirrors the “tournament of shadows” fought in the 19th century by spies, soldiers and fortune-seekers from imperial Russia and Britain in an attempt to control Central Asia. Today, though, the political battles of the former Soviet Union are fought not in the parched valleys east of the Caspian but in western courts, parliaments and media. Dictators’ representatives tirelessly curry favour at Westminster and on Capitol Hill. Oligarchs are fixtures in London’s High Court listings. Rare is the business journalist who has not spent lunch listening to the PRs of one recently minted billionaire smear another recently minted billionaire.
As they sized each other up in 2009, Ablyazov says he asked Wahid to prove his worth by providing some valuable intelligence against Nazarbayev, but Wahid only offered documents that Ablyazov had already acquired. (Wahid disputes this.) Ablyazov grew suspicious that Wahid was, in fact, playing a double game and working for Nazarbayev’s regime. As he listened to descriptions of Arcanum’s services, he started to think that the meetings were a trap designed to lure him into illegal activity in the UK, where he had claimed asylum, and decided against hiring the firm. “We never gave them a proposal for fighting Nazarbayev but, yes, we were working for Kazakhstan at this time,” Wahid told me. The two sides had “a general discussion of our capabilities”, he said. But Wahid insisted that Arcanum never does anything illegal. Ablyazov’s suggestion to the contrary — part of a narrative in which Arcanum is key to Nazarbayev’s campaign of persecution — was a “fantasy”, Wahid said.
The Ablyazov case mirrors the “tournament of shadows” fought in the 19th century by spies, soldiers and fortune-seekers from imperial Russia and Britain in an attempt to control Central Asia. Today, though, the political battles of the former Soviet Union are fought not in the parched valleys east of the Caspian but in western courts, parliaments and media. Dictators’ representatives tirelessly curry favour at Westminster and on Capitol Hill. Oligarchs are fixtures in London’s High Court listings. Rare is the business journalist who has not spent lunch listening to the PRs of one recently minted billionaire smear another recently minted billionaire.
As they sized each other up in 2009, Ablyazov says he asked Wahid to prove his worth by providing some valuable intelligence against Nazarbayev, but Wahid only offered documents that Ablyazov had already acquired. (Wahid disputes this.) Ablyazov grew suspicious that Wahid was, in fact, playing a double game and working for Nazarbayev’s regime. As he listened to descriptions of Arcanum’s services, he started to think that the meetings were a trap designed to lure him into illegal activity in the UK, where he had claimed asylum, and decided against hiring the firm. “We never gave them a proposal for fighting Nazarbayev but, yes, we were working for Kazakhstan at this time,” Wahid told me. The two sides had “a general discussion of our capabilities”, he said. But Wahid insisted that Arcanum never does anything illegal. Ablyazov’s suggestion to the contrary — part of a narrative in which Arcanum is key to Nazarbayev’s campaign of persecution — was a “fantasy”, Wahid said.
Those London meetings represented the early exchanges
in perhaps the most remarkable battle the secrets industry has yet fought. A
Financial Times investigation based on dozens of interviews and thousands of
pages of court documents, leaked emails and confidential contracts exposes a
saga in which Arcanum is just one piece on a chessboard that spans four
continents. It reveals how the mercenaries of the information age are shaping
the fate of nations.
----For a country of 18 million people with an economy
about half the size of Ireland’s, Kazakhstan has made a disproportionately
large contribution to the private intelligence industry. Through the noughties,
as its oligarchs poured their fortunes into western assets and listed their
companies on western stock exchanges, their appetites and rivalries made
lucrative work for these secretive firms.
“At one point, literally everyone I know in London was
working on Kazakhstan,” says a private investigator who worked on several
Kazakh dossiers. Another says all the money pouring in from the former Soviet
Union helped to make the private intelligence game in London “very dirty”.
The British capital, for centuries an entrepôt for
spies, moneymen and emissaries, has become the industry’s heart but the
archetypal corporate intelligence firm was founded in New York. In 1972, Jules
Kroll took skills he had honed exposing those who demanded kickbacks from the
family printing business to found what became Kroll Inc. After 32 years of
hostile takeovers, hostage negotiations and everything in between, Kroll sold
the business for $1.9bn.
By then, rivals had sprung up. Some had links to
private military contractors that profited from the wars in Afghanistan and
Iraq. Others were founded by CIA or MI6 alumni. The big accountancy firms,
including EY, Deloitte and PwC, set up corporate investigations arms. Scores of
small outfits emerged, specialising in particular regions or techniques. Some
companies fused sleuthing with propaganda, another boom industry. In 2006, FTI
Consulting, a US investigations group, paid $260m to acquire the City PR firm
Financial Dynamics.
More
And so
on to 2018, and the second year of the Great Trump Presidency. A healthy, prosperous,
and enjoyable 2018 to all.
“A third group of inflationists do not deny that inflation
involves serious disadvantages. Nevertheless, they think that there are higher
and more important aims of economic policy than a sound monetary system. They
hold that although inflation may be a great evil, yet it is not the greatest
evil, and that the State might under certain circumstances find itself in a
position where it would do well to oppose greater evils with the lesser evil of
inflation.”
Ludwig von Mises, The Theory of Money and Credit
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