Tuesday 5 June 2018

USA to Germany: Know Thy Place.


Baltic Dry Index. 1193 +37     Brent Crude 75.53

The most terrifying words in the English language are: I'm from the US government and I'm here to help.

The G-6, with apologies to Ronald Reagan.

In the great global casinos of stocks-land, the gambling and merriment went on as usual, even as the real world lurched ever closer to a new global crisis. In Germany, the new US Ambassador seems to have written off Chancellor Merkel. In America President Trump was busy stepping up his trade war rhetoric ahead of the coming G-7 summit. A good time is unlikely to be had by any.

There can be few fields of human endeavour in which history counts for so little as in the world of finance. Past experience, to the extent that it is part of memory at all, is dismissed as the primitive refuge of those who do not have the insight to appreciate the incredible wonders of the present.

J. K. Galbraith.

June 5, 2018 / 1:39 AM

Asia stocks edge down after rally, focus back on fundamentals

TOKYO (Reuters) - Asian stocks pulled back on Tuesday as investors paused for breath after the previous day’s rally, although tech-inspired Wall Street gains supported broader sentiment as focus shifted to bullish economic fundamentals, away from trade concerns.

MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS dipped 0.1 percent after surging 1.4 percent the previous day.

Japan's Nikkei .N225 gained 0.2 percent and South Korea's KOSPI .KS11 lost 0.15 percent. Hong Kong's Hang Seng .HSI shed 0.2 percent and the Shanghai Composite Index .SSEC was little changed.

Wall Street’s three major indexes rose overnight, led by a rally in tech stocks, pushing the Nasdaq to a record closing high. [.N]

Friday’s better-than-expected May U.S. employment report has helped revive investor optimism about the world’s biggest economy, shifting the focus away from recent trade tensions.

“Strong U.S. data put fundamentals back in the spotlight, just as Italian political concerns were ebbing,” said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management in Tokyo.

Italy’s anti-establishment parties formed a coalition government on Friday to end three months of deadlock and averting potentially destabilising snap elections.

“The next focal point is the upcoming FOMC (Federal Open Market Committee) meeting and whether the Fed shows any indication of accelerating the pace of its rate hikes following the strong employment report,” said Ichikawa.
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In the anti-EU Trump Trade War news, President Trump has opened up a new political front against Germany, anti-Merc tariffs next?

President Putin opens up a new EU Russian front in Austria, but he’s not trying to split the EU, he says.   They don’t need any outside help.

This Friday and Saturday’s upcoming G-7 meeting looks set to be the frostiest G-7 meeting in its history. Food tasters all round.

“It is difficult not to marvel at the imagination which was implicit in this gargantuan insanity. If there must be madness something may be said for having it on a heroic scale."

John Kenneth Galbraith. The Great Crash: 1929.


June 4, 2018 / 6:34 PM

U.S. envoy's unorthodox diplomacy stirs stiff response in Berlin

BERLIN (Reuters) - Germany has asked the U.S. government to clarify remarks by President Donald Trump’s new ambassador to Berlin after he told a right-wing website he wanted to empower “other conservatives” in Europe.

The comments by Richard Grenell, a former U.S. spokesman at the United Nations and an outspoken defender of Trump, drew criticism from politicians across the German political spectrum, warning him not to meddle in domestic politics.

“We have asked the U.S. side for clarification, and whether (the remarks) were made as reported,” a foreign ministry spokesman said.

The issue would be looked at again on Wednesday when Grenell is due to make his first official call at the ministry, the spokesman said.

The political appointee caused anger on his first day in Berlin with a tweet telling German companies to wind down their business from Iran after the U.S. withdrew from a non-proliferation deal with Iran.

In a further breach of protocol, Grenell also invited Austria’s Chancellor Sebastian Kurz, a critic of German Chancellor Angela Merkel’s refugee policies, to an embassy lunch during his June 12 visit to Berlin, Spiegel magazine reported.

----In an interview with Breitbart News at the weekend, Grenell attributed the groundswell of conservatives across Europe to the “failed policies of the left”, adding: “I absolutely want to empower other conservatives throughout Europe, other leaders.”

In the same interview, he described himself as a big fan of Kurz, the head of the conservative People’s Party and who shares power with the far-right Freedom Party in Vienna. An embassy spokesman said Kurz had requested the meeting.

Merkel declined to comment on Kurz’s planned visit to the U.S. embassy during his visit to Berlin. “Like many others, I have taken note of this,” she said in a cool remark at a news conference with Israeli Prime Minister Benjamin Netanyahu.

Netanyahu said that he had also had a brief meeting with Grenell during his Berlin visit. “I was asked by the American ambassador to meet him at the airport,” he said. “I wouldn’t draw any great meaning into that.”

Rolf Muetzenich, deputy leader of the Social Democrats in parliament, said Grenell’s remarks should be raised quickly with Secretary of State Mike Pompeo.

“Clearly the U.S. ambassador sees himself as an extension of a right-wing conservative world movement,” he told Reuters. Muetzenich added that Grenell’s actions violated the 1961 Vienna Convention, under which diplomats do not interfere in the domestic affairs of a country.
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June 4, 2018 / 9:08 PM

Russia not trying to split EU, Putin says before rare visit to Western Europe

VIENNA (Reuters) - Russian President Vladimir Putin, in an interview broadcast on Monday, said he did not want to divide the European Union as he prepared to visit Austria in his first bilateral trip to a West European country in almost a year.

“We do not pursue the objective of dividing anything or anyone in the EU,” Putin told broadcaster ORF.

“We are far more interested in the EU being united and flourishing because the EU is our most important trading and economic partner.”

Putin, who has not made a bilateral visit to a West European country since he went to Finland last July, will meet government and business leaders in Austria in a trip which officially marks 50 years since the two countries’ energy firms Gazprom and OMV first signed a gas supply deal.

He will attend a business conference with envoys from both countries.

But the issue of EU sanctions, imposed on Russia because of its support for pro-Russian separatists in eastern Ukraine, will weigh in any official talks he has.

Moscow’s ties with EU countries remain strained after Russia’s annexation of Crimea, its involvement in Syria and eastern Ukraine and the poisoning of a former Russian double agent in Britain. London has blamed the nerve agent poisoning of Sergei Skripal and his daughter on Russia but Moscow has denied any involvement.

Austria’s coalition government of conservatives and the pro-Putin far right was in a minority of EU governments that did not expel any Russian diplomats over the Skripal case and Austria, despite its membership of the EU, points to its history of neutrality and its relatively warm relations with Russia.
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June 4, 2018 / 3:07 PM 

Trade war turns Canada's G7 summit into six-plus-Trump

OTTAWA/WASHINGTON (Reuters) - Prime Minister Justin Trudeau this week plays host to a summit of the Group of Seven leading industrialized nations with six of the seven members outraged at the United States over a slew of recent moves by President Donald Trump.

This year’s meeting is likely to be overshadowed by Trump’s planned summit with North Korean leader Kim Jong Un, tentatively scheduled for June 12 in Singapore, where Pyongyang’s nuclear program is expected to be discussed.

Trudeau, who wants the June 8-9 meeting to focus on economic growth, insists he can handle the challenge, though insiders and analysts say he will have to fight to keep the grouping together at a time when Trump’s trade and diplomatic moves have isolated the United States and risk undermining the G7’s relevance.

“What this G7 is going to show is that the United States are alone against everyone and especially alone against their allies,” French Finance Minister Bruno Le Maire told reporters on Friday before a meeting of his counterparts in British Columbia.

Trump’s disdain for diplomatic niceties and his “America first” policies have created a rift with countries whose alliance with the United States dates to the Cold War with the Soviet Union.

----Trudeau played down the talk of divisions at the summit, in the Quebec town of La Malbaie. “These questions get asked every time,” Trudeau told Reuters in a May 24 interview. He said the G7 was “extraordinarily valuable because it’s an opportunity for like-minded nations to come together and talk about shared challenges.”

A spokesman for Trudeau said the prime minister’s position had not changed despite the tariffs.

University of Ottawa international affairs professor Roland Paris, who served as Trudeau’s first foreign policy adviser, has a less upbeat view. “The primary challenge for this summit is to maintain the integrity of the G7 itself,” he said.

While the most likely scenario was that the leaders gloss over their differences, he added, “there is the real possibility of a more open rupture.”
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Finally, so you really want a cashless society? Think again. You’ll be one accident, cybercrime, or incompetent software upgrade away from becoming Puerto Rico after hurricane Maria hit last year.

In GB, people were stuck at toll booths over the River Severn into Wales, stuck in train stations unable to buy tickets, stuck in supermarkets having to line up at cash machines, stuck in restaurants and bars like deadbeat cheats.

Visa Goes Down in the UK, Chaos Ensues, Cash is Suddenly King

by Don Quijones • Jun 2, 2018 

War on Cash Suffers Setback.

For over 12 hours on Friday, shopping centers in the UK and other parts of Europe were plunged into chaos as millions of consumers were unable to use their Visa debit or credit cards at points of sale. The credit card company, which was finally able to restore normal service early Saturday morning, said it had no reason to believe the hardware failure was due to “any unauthorized access or malicious event”.

While the mayhem caused by the outage may have been short lived, it served as a stark reminder of the risks, both for consumers and retailers, of depending purely on cashless payments. In the UK, the chaos unleashed was particularly acute since it is one of the world’s most cashless economies, pipped to the post only by Canada and Sweden, as a recent study by industry analysts reported.

In 2017, cards overtook cash for retail payments in UK for the first time ever, according to figures from the British Retail Consortium. According to Visa, payment processing through its systems accounts for a staggering £1 in every £3 of all retail spending in the UK. Which is why, when those systems stopped working yesterday, the chaos was greater in the UK than almost anywhere else as cashless customers missed trains, were unable to fill up their cars, pay for their groceries, or even clear their bar tab — this was Friday, after all!

“There is never a good time for the payments system to go down but a Friday afternoon, when there is a flood of people leaving work, must be among the worst,” one banking industry source said. The only way for people to pay for stuff was with co-branded Mastercard cards, or hard cold cash. Luckily, Visa cards were still working at ATMs, although the queues were considerably longer than normal.

In a beautiful irony, Visa, a company whose stated mission is to “put cash out of business” as quickly as possible, had little choice but to urge its customers to withdraw and use physical bank notes for transactions until the technical issue was resolved. Without access to cash, the chaos caused by yesterday’s outage would have been immeasurably worse.

While the UK has happily embraced cashless living, with a resultant explosion in personal debt levels, in many other countries Visa has been dogged by the stubborn survival of cash and checks, despite widespread government and corporate efforts to kill them off. Globally, check and cash transactions totaled $17 trillion in 2016 — up 2% from a year earlier. To try to counter that trend, Visa rolled out a new US initiative in the summer of 2017 that offered to award 50 eligible retail businesses (online businesses are excluded) up to $10,000 each if they committed to refusing cash payments.

Visa is thinking of extending the initiative to its UK market, although it is roundly criticized by consumer groups, who say cash is still vital for many people. Serious questions have also been raised about the oft-touted financial benefits of going 100% cashless. According to a “study” that Visa recently “conducted,” if businesses in 100 U.S. cities “transitioned from cash to digital, those cities would stand to experience net benefits of $312 billion per year.”

It’s not hard to guess who would be the biggest beneficiary. Card fees, which are paid by merchants and usually passed on to customers via higher prices, normally range between 1% and 3%. Among the entities that get to divvy this moolah up are the bank that issued the visa card and the credit card network – such as Visa, MasterCard, Amex and the like. Visa gets just a small piece of the action, but if it is on every transaction, it adds up. In 2016 Visa extracted $15 billion from processing transactions globally without even carrying any credit risk (the banks have to deal with that).

Going completely cashless with risks, as consumers in Europe were just reminded: system outage. If the payment system goes down and all you have to pay with are cards or your mobile phone, you could suddenly find yourself quite literally cashless, as happened to many Puerto Ricans after the power outages in 2017, caused by Hurricane Maria, knocked out electronic transactions and ATMs for days or weeks on end.

It was a stark reminder of just how fragile and vulnerable a 100% cashless society would be — at least until a cashless system can be created that is 100% safe from the threats posed by natural disasters, accidents, cybercriminals, and basic human incompetence.
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Democracy is the power of equal votes for unequal minds
King Charles I of England

Crooks and Scoundrels Corner

The bent, the seriously bent, and the totally doubled over.
Not the usual suspects today. Today big brother and the deep state are out to get you. Of course, if you’ve nothing to hide you’ve nothing to fear, right? How well did that turn out for President Trump.
“I would know by what power I am called hither.”  
King Charles I of England. Trial, Saturday January 20, 1649.

How a Hacker Proved Cops Used a Secret Government Phone Tracker to Find Him

And how it might change what cops can do with our smartphones.
By CYRUS FARIVAR  June 03, 2018

On a warm summer’s day in 2008, police spotted a man walking outside his apartment in Santa Clara, California, one of the many bedroom communities spread across Silicon Valley. Undercover FBI officers saw him outside the building and began following him on foot, radioing to their colleagues nearby. The man saw the agents, and so he began to walk quickly. They followed suit.

After months of tracking him via sting bank accounts and confidential informants, the officers had their man. He had told the apartment complex’s manager that he was Steven Travis Brawner, software engineer: a profile that fit right in with many other tenants in the area. But at the time of his arrest, officers didn’t know his real name: After watching his activities at a distance, they called him simply the “Hacker.” Between 2005 and 2008, federal investigators believed that the Hacker and two other men filed over 1,900 fake tax returns online, yielding $4 million sent to over 170 bank accounts.
The Hacker was found out through the warrantless use of a secretive surveillance technology known as a stingray, which snoops on cell phones. Stingrays, or cell-site simulators, act as false cell phone towers that trick phones into giving up their location. They have become yet another tool in many agencies’ toolbox, and their use has expanded with little oversight—and no public knowledge that they were even being used until the Hacker went on an obsessive quest to find out just how law enforcement tracked him that summer day. When he tugged on that thread, he found out something else: that police might be tracking a lot more than we even know on our phones, often without the warrants that are usually needed for comparable methods of invasive surveillance.
----But the Hacker didn’t get far. He was quickly surrounded, arrested and searched. The police found the key to the Hacker’s apartment. Later, after police obtained a warrant to search his apartment, they found there a folding chair and a folding table that served as a desk. There was no other furniture—his bed was a cot. Law enforcement also found his Verizon Wireless mobile Internet AirCard, and false driver’s licenses with the names “Steven Travis Brawner,” “Patrick Stout” and more. A 2010 FBI press release later stated that the agency also “seized a laptop and multiple hard drives, $116,340 in cash, over $208,000 in gold coins, approximately $10,000 in silver coins, false identification documents, false identification manufacturing equipment, and surveillance equipment.”
----By the time he was arrested, Rigmaiden had made about $500,000. After Rigmaiden was arrested in California, he was quickly transported to the Florence Correctional Center, about 65 miles southeast of Phoenix. Despite being incarcerated, Rigmaiden could not sit still. He knew that he had been careful. He had used multiple fake identities, with fake documents, and paid in cash. How could law enforcement have not only found him out, but found him in his own apartment, where hardly anyone knew he lived?
Rigmaiden thought there might be something that the government wasn’t telling him—there might be some secret surveillance tool afoot. He tried pressing his federal public defenders to listen, but they wouldn’t. Within two months, he’d fired one of his lawyers, and then another. In essence, he didn’t feel that they were technically sophisticated enough to be able to help him get the answers he needed. Eventually, the accused fraudster got permission to represent himself (pro se), a legally risky move.

Once he was representing himself, he was allowed to use the law library for five hours a day (up from the usual three hours a week). It became a full-time job, immersing himself in legal procedures—but it was likely the most productive way to spend his time behind bars. Fortunately, at the beginning, a fellow inmate and disbarred attorney helped him out with some of the basics, including general court procedure, how to draft a motion and correct legal citation. By October 2009, Rigmaiden had received boxes and boxes (over 14,000 pages in total) of criminal discovery that would help him understand how the government planned to prosecute its case. In the penultimate box, he saw the word “stingray” in a set of notes.

As a prisoner, he wasn’t allowed Internet access, but sometimes a “case manager,” a sort of guidance counselor, could be convinced to run online searches for inmates who were pursuing legal research. Though this process, Rigmaiden located a https://www.politico.com/magazine/story/2018/06/03/cyrus-farivar-book-excerpt-stingray-218588 name. Bingo. The device advertised various types of cellular interception
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Stingray phone tracker

The StingRay is an IMSI-catcher, a controversial cellular phone surveillance device, manufactured by Harris Corporation.[2] Initially developed for the military and intelligence community, the StingRay and similar Harris devices are in widespread use by local and state law enforcement agencies across Canada,[3] the United States,[4][5] and in the United Kingdom.[6][7] Stingray has also become a generic name to describe these kinds of devices.[8]
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Long-Secret Stingray Manuals Detail How Police Can Spy on Phones

Sam Biddle 
September 12 2016, 7:33 p.m

English Court of Star Chamber: A Brief History

Updated March 13, 2018
The Court of Star Chamber, known simply as the Star Chamber, was a supplement to common-law courts in England. The Star Chamber drew its authority from the king's sovereign power and privileges and was not bound by the common law.

The Star Chamber was so named for the star pattern on the ceiling of the room where its meetings were held, at Westminster Palace.

----Disadvantages of the Star Chamber:

The concentration of such power in an autonomous group, not subject to the checks and balances of common law, made abuses not only possible but likely, especially when its proceedings were not open to the public. Although the death sentence was forbidden, there were no restrictions on imprisonment, and an innocent man could spend his life in jail.

The End of the Star Chamber:

In the 17th century, the proceedings of the Star Chamber evolved from above-board and fairly just too secretive and corrupt. James I and his son, Charles I, used the court to enforce their royal proclamations, holding sessions in secret and allowing no appeal. Charles used the court as a substitute for Parliament when he tried to govern without calling the legislature into session. Resentment grew as the Stuart kings used the court to prosecute nobility, who would otherwise not be subject to prosecution in common-law courts.

The Long Parliament abolished the Star Chamber in 1641.
“For me to acknowledge a new court that I have never heard of before – I that am your King, that should be an example to all the people of England for to uphold justice, to maintain the old laws – indeed I do not know how to do it.”
King Charles I of England. Trial, Tuesday January 23, 1649. 
Technology Update.
With events happening fast in the development of solar power and graphene, I’ve added this section. Updates as they get reported. Is converting sunlight to usable cheap AC or DC energy mankind’s future from the 21st century onwards?

Our Tesla Solar Home Update — It Just Gets Better & Better!

June 2nd, 2018 by Bob Borsh 
As I write this on a Tuesday morning, we are just beginning our 5th week of operation of our Tesla solar array + Powerwall setup. I thought it would be a good time to share the operational experiences and learning curves we’ve gone through to optimize operation and minimize our exposure to grid-supplied power.

For anyone who hadn’t read my first article about the Tesla Energy experience, the short version is that we installed an 8.125 kW solar array on a predominantly south-facing roof on our 2800 sq ft colonial located in the woods 6 miles to the west of the village of Woodstock, VT. In addition to the array, we had Tesla Energy install a Powerwall 2 and a dedicated 48 amp vehicle charger.

The most recent Google satellite photo available does not show the actual panels in place, but the position of the sun when the satellite pic was taken gives you a pretty good idea of our exposure. The trees nearest the house were also removed to allow for a longer daily exposure through all seasons.

The Tesla app is your best friend for monitoring and controlling the operational parameters of the system, especially if you have a Tesla vehicle and Powerwall in the mix. The app lets you:
1) Toggle between your vehicle, the Powerwall, and the solar array to see the status of each in real time. It allows you to start and stop charging your vehicle (if it’s plugged into a charger, of course).

2) Customize your Powerwall. Here are the options:

Backup-only: 100% of your powerwall is reserved for backup power at all times.
Self-powered: Used stored solar to power your home after the sun goes down. You can set the reserve battery storage (for use during power outages) anywhere from 0 to 100%.

3) View usage and stored energy by the hour, day, week, or month.

The normal sequence of operations is as follows: Solar energy is converted into DC electrical energy through solar panel absorption. This energy flows to the SolarEdge inverter where it is converted into utility-frequency AC. The dwelling, as it may be, is the first destination to use this electricity.
Anything generated beyond the required “at the moment” dwelling usage is directed to the Powerwall to charge it to 100% at a max instantaneous rate of 5kW. If there is still more power being generated by the array than can be used by those two destinations, the overage is sent back to the grid.

All of these values are constantly fluctuating dependent upon the amount of radiant energy getting to the array through the earth’s atmosphere. Even on the cloudiest days, our array will generate a minimum of 0.2 kW of solar at a time, which is enough to power our home when no one is home and energy usage is at a minimum.

The four screenshots included with this article are taken directly from the app. The 2nd and 4th, taken within one minute of each other on Wednesday, May 9, 2018, show the overall effectiveness of the system that is powering our house while also allowing me to charge the Model S for my daily commute, some days without using any external power sources.
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“Yet for all this, God forbid that I should be so ill a Christian as not to say that God’s judgments are just upon me.”
King Charles I of England. Execution, Tuesday January 30, 1649. 

The monthly Coppock Indicators finished May.

DJIA: 24,416 +201 Down. NASDAQ: 7,442 +276 Down. SP500: 2,705 +180 Down.
All three slow indicators moved down in March and have continued down in April and May. For some a new bear signal, for others a take profits and get back to cash signal. 

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