Month: July 2015

Why the Germans Shouldn’t Run the EU

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It turns out that the economy of North Korea grew faster than the EU’s economy last year:

North Korea’s economy expanded by 1.0% to $29.85 billion (£19 billion) in 2014, according to Reuters citing analysis from South Korea’s central bank.

That’s just better than the 0.9% growth recorded in the Eurozone last year.

The Bank of Korea (BoK) report that “the increase in economic activity was attributed mainly to growth in services and building while farming, mining and manufacturing saw slower growth.”

Growth in services, making up around 31.3% of total economic output, accelerated to 1.3%, up from 0.3% in 2013, with retail sales, food, and accommodation, logistics and communications all expanding from a year earlier.

………

North Korea does not release official economic data, hence the reliance on the BoK analysis to estimate economic output.

EU growth is pathetic.

What’s more the EU’s hegemon and chief predatory exporter, Germany, experienced a GDP growth roughly double that of the EU as a whole.

German policies with regard to the EU, and particularly with regard to the Euro zone, are about benefiting the nation at the expense of its neighbors.

German domination was a bad idea in 1935, and it’s a bad idea in 2015.

The Turks Insist That There Was No Armenian Genocide

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I wonder how they explain a Turkish official taunting starving Armenian children with a piece of bread in 1915.

I do not understand why Turkey continues insist that there was no Armenian Genocide, or why some Turks maintain insist that there was a genocide of Turks by the Armenians, but the only thing that they get from this behavior is a loss of credibility.

It’s enough to make every decent human being quote Joseph Welch.*

*Joseph Welch is best known for an exchange with Senator Joseph McCarthy in which he said, “You’ve done enough. Have you no sense of decency, sir? At long last, have you left no sense of decency?”

What a Surprise

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We now have a $1,000,000,000 cost overrun on the new Boeing Tanker:

Boeing is, once again, taking a charge on its books to keep the U.S. Air Force’s KC-46 aerial refueler program on track.

The after-tax charge is $536 million; that is $835 million before taxes. The lion’s share – $513 million – comes from Boeing Commercial Airplanes, which is providing the 767 baseline platform, while Boeing Military Aircraft, a division of Boeing Defense Space and Security, is paying $322 million. More detail is expected in an earnings call for the second quarter scheduled for July 22.

The past two years of Boeing KC-46 charges amount to a pre-tax burden of $1.26 billion for the program.

This most recent overrun is a result of technical problems with the tanker’s complex integrated fuel system, which provides fuel to fly the KC-46 as well as to receivers taking on fuel from a centerline boom or wing-mounted pods. The fuel system is the heart and soul of an aerial tanker, and Boeing’s extensive experience building tankers was a major selling point in its bid against Airbus for the KC-X competition. The problems arose as the company “prepared for and conducted test and verification of that system during the second quarter,” the company’s July 17 announcement says. Multiple Boeing spokesmen declined to say when the test problems came to light beyond pointing to the second quarter, or April – June.

On May 26, however, Boeing CEO Jim McNerney told Aviation Week the program appeared on track. “If there were any cost overruns [anticipated] we would tell you. Could things go wrong? A test [anomaly] that would cause a delay or an extra charge? It’s a possibility. But it’s not what we see today. We have a high degree of confidence,” he said.

This raises the question of when the design failures came to light and when they were briefed up the company’s chain of command. The spokesmen declined to provide input on this point, citing the forthcoming earnings call.

“[Boeing is] working through the qualification process of the complete KC-46 weapon system, and not surprisingly the integrated fuel system is a large part of that effort,” said Brig. Gen. Duke Richardson, program executive officer of tankers for the Air Force. “With EMD-1 exiting fuel dock and preparing to return to flight and the entry of EMD-2 into fuel dock, Boeing continues to make solid progress. While we have more heavy lifting coming up, we believe it is achievable and do not see any technical showstoppers.”

Boeing took a $272 million after tax charge – or $425 million pre-tax – last summer due to an inadequate design for wiring bundles on the aircraft. The Air Force requires redundancies and “safe separation” between some wiring components in the militarized 767, and the design fell short, prompting an extensive redesign and months-long delay to the first flight of the tanker.

………

Following last year’s charge, Pentagon procurement chief Frank Kendall predicted more overruns, to the chagrin of the company. “Boeing has taken a pretty large loss that they recently booked against the tanker. We expected that. There’s potential for additional loss that Boeing would have to absorb. But there’s a lot of business for Boeing at the end of this, and that’s one of the reasons we did it this way. They have a business case to finish the program and deliver the tanker,” he told Aviation Week in November.

How the f%$# does Boeing, which pretty much invented the airborne tanker, manage to f%$# up making a tanker out of a design that has its origins from about 40 years ago, when Israel has already deployed and sold 767 tanker conversions to foreign customers, and the Airbus A330 tanker is currently flying with 4 nations.

How the hell do you have a 22% cost overrun on crap like this?

This is happening because Boeing knows that the Washington State Congressional delegation has its back, so they delivered an unrealistic bid, and executed it poorly, because it is a heads Boeing wins tails the taxpayers lose.

Out Mutha F%$#ing Standing Family Experience

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Scaramouche, Scaramouche,
can you do the Fandango!

The whole family went to the 2015 Artscape, billed as “America’s largest free arts festival!” (Yes they use the exclamation point).

It’s one part an arts festival, one part local music, one part classic Baltimore weirdness, one part corporate PR, one part an enormous concentration of stall food, and one part block party.

A great time was had by all, and on the way home, the Queen song, Bohemian Rhapsody, and, at my prodding, we all sang along.

It was a truly brilliant moment.

BTW, no one caught it on a cell phone video, and if we did, we wouldn’t share it with you.

It’s a family thing.

Amy Schumer is a Genius

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Normally, I don’t trouble myself with the comings and goings of our entertainment, but this prank that Amy Schumer pulled on Katie Courica is epic:

She left her phone open to texts from [her husband, John Molner]. Don’t worry! I didn’t do anything. Except I picked it up, just without even thinking, to text him: “I wanna have anal tonight.” And I sent it… I didn’t even think. It just happened. I pick up the phone, it happened so fast. I show Mindy and I go, “Look what happened!’” She’s like, “What do you mean what happened? You did that! You just did that!” I show Colbert and he is on the floor laughing, like, on the floor. Katie comes back like 90 seconds later and her and her husband are like, “So… we’re leaving.” Like, “I don’t know why he wants to leave.” She loves humor.

Couric’s response makes it even funnier:

Note to self: Keep phone away from @amyschumer at all times. #epicprank #itspaybacktimesister 😁

— Katie Couric (@katiecouric) July 16, 2015

This is just brilliant.

I Expect to See a Massive Increase in Tourism to Turkey

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In response to a previous opinion by another Turkish theologian, Ahmet Mahmut Unlu, a Turkish televangelist has specifically stated that oral sex is a permitted sex act under Islam:

Last week, Turkish theologian Ali Rıza Demircan made headlines when he described “advanced oral sex” as forbidden in Islam during a television interview, as viewers watched the presenter erupt into laughter.

However, in a response to the controversial claim, a popular Muslim televangelist in Turkey offered an opposing view, saying Islam permits oral sex.

“Do not invent a lie on behalf of Allah,” said Ahmet Mahmut Unlu, popularly known as “Cubbeli Ahmet Hoca” (Robed Ahmet Hoca) among his followers, during his latest televised sermon, Hurriyet Daily News reported.

Unlu said the Quran does not have verses that stipulate such ban on oral sex.

………

“No Islamic jurisprudence calls it a haram act, but some find it inappropriate. So, how can [Demircan] say that it is haram? What is your source?” Unlu said.

I guess that “Advanced Oral Sex” is a 300 level course.

Certainly, I can see how a debate about this issue might get out of  ……… hand.

And Once Again, Obama Bails out Crooked Banksters

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It looks like the Obama Administration has once again insured that there is no accountability for crooked banksters:

Three top Democrats are accusing the Department of Housing and Urban Development of quietly removing a key clause in its requirements for taxpayer-guaranteed mortgage insurance in order to spare two banks recently convicted of federal crimes from being frozen out of the lucrative market.

HUD’s action is the latest in a series of steps by federal agencies to eliminate real-world consequences for serial financial felons, even as the Obama administration has touted its efforts to hold banks accountable.

In this sense, the guilty plea has become as meaningless to banks as their other ways of resolving criminal charges: out-of-court settlements, or deferred prosecution agreements. “Too Big to Fail” has morphed into “Too Big to Jail” — and then again, into “Bank Lives Matter.”

Sens. Sherrod Brown and Elizabeth Warren and Rep. Maxine Waters fired off a letter to HUD on Tuesday, saying they believe that the timing of the change was designed to clear the way for two banks recently convicted of federal crimes — JPMorgan Chase and Citigroup — to continue to make Federal Housing Administration-insured loans. Last year, JPMorgan Chase wrote $1.67 billion in FHA loans, and Citi wrote $342 million, according to data from the Congressional Research Service.

On May 20 of this year, JPMorgan Chase and Citigroup both entered a guilty plea on one felony count of conspiring to rig foreign currency exchange trades, the largest market on the globe.

Five days earlier, on May 15, HUD slipped a notice into the Federal Register, seeking to alter its standard loan-level certification form, known as HUD-92900-A. This form must be filled out for lenders to receive FHA insurance, which reimburses them if the homeowner falls into foreclosure.

On the current HUD-92900-A form, lenders must certify that their firm and its principals “have not, within a three-year period … been convicted of or had a civil judgment rendered against them” for a variety of crimes, including “commission of fraud … violation of Federal or State antitrust statutes or commission of embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements or receiving stolen property.”

JPMorgan and Citi’s guilty plea would fall under the antitrust statute, and according to Brown, Warren and Waters’ reading of the certification, that would make them ineligible to obtain FHA insurance on their loans.

On the updated form, this language has been excised. The notice in the Federal Register did not even mention the removal, making it impossible to discover without comparing the old form and the proposed form side by side. The Wall Street Journal ran a story about the certification changes in May, but failed to notice that the new language would let law-breaking banks off scot-free.

The day before HUD released the notice in the Federal Register, the New York Times reported that the Justice Department sought to lessen the consequences of the guilty pleas in the foreign exchange rigging case, ensuring that federal regulators would not use the pleas to bar banks from certain business lines.

The Securities and Exchange Commission then granted waivers from disqualification to JPMorgan Chase, Citi, and the other guilty banks in the case, over the objections of one SEC Commissioner that the big banks had effectively become “Too Big to Bar.”

The HUD changes would similarly take away an automatic penalty for bank misbehavior. Per Brown, Warren and Waters, they “allow HUD to turn a blind eye to criminal violations — putting homebuyers and taxpayers at additional risk.”

HUD spokesperson Cameron French said the agency was not providing comment on the Democratic letter. He said HUD would review it and respond accordingly.

………

The Democratic lawmakers believe removing the certification language results in a change in policy rather than simply a change to the form. They requested that HUD withdraw the notice and issue it again under the Administrative Procedures Act, giving an explicit rationale for the change, and how it would affect JPMorgan and Citigroup’s FHA loan status. The public would then have an additional 60-day comment period.

This sort of crap needs to end.

Someone at the IMF Gets It, but It Ain’t Lagarde

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In response to the mindlessly punitive deal for the Greek bailout, IMF staff have released a report that calls for massive debt write-downs, and an anonymous source at the IMF implied that such a write-down is a requirement for IMF participation:

The International Monetary Fund threatened to withdraw support for Greece’s bailout on Tuesday unless European leaders agree to substantial debt relief, an immediate challenge to the region’s plan to rescue the country.

 The aggressive stance sets up a standoff with Germany and other eurozone creditors, which have been reluctant to provide additional debt relief. The I.M.F role is considered crucial for any bailout, not only to provide funding but also to supervise Greece’s compliance with the terms.

 A new rescue program for Greece “would have to meet our criteria,” a senior I.M.F. official told reporters on Tuesday, speaking on the condition of anonymity. “One of those criteria is debt sustainability.”

 Debt relief has been a contentious issue in the negotiations over the Greek bailout.

 Athens has pushed aggressively for creditors to write down the country’s debt, which now exceeds €300 billion. Without it, Prime Minister Alexis Tsipras has argued the debt will remain a heavy weight on Greece’s troubled economy.

 But Germany and other countries, including the Netherlands and Finland, are loath to grant Greece easier terms, which are a tough sell to their own voters. German Chancellor Angela Merkel has ruled out a “classic haircut” on Greece’s debt.

 The I.M.F. is now firmly siding with Greece on the issue. In a report released publicly on Tuesday, the fund proposed that creditors let Athens write off part of its huge eurozone debt or at least make no payments for 30 years.

 ………

 In going public, the I.M.F. is making a tactical move, adding pressure to the negotiations over the bailout deal. But its aggressive position also complicates efforts to complete a deal, with Greece’s Parliament scheduled to vote on Wednesday whether to accept the creditors’ conditions.

One thing that we can be sure of, however, is that whoever leaked the need for debt relief was not the Managing Director of the International Monetary Fund Christine Lagarde, because she has walked back this assessment:

In general, when discussing large complicated institutions distinctions must be made between parts of this institution. The mainstream press is particularly bad at that kind of nuance because these organizations are already complicated: making further distinctions between IMF managing directors, IMF staff and the IMF executive board gets needlessly obscurant in their view. However, these distinctions are important. The report that was leaked two weeks ago and the latest update to that report was written by IMF staff and specifically “neither discussed with nor approved by the IMF’s Executive Board”. Additionally, Christine Lagarde or her title “managing director” appear no where in this document. Thus to say that the “IMF” is saying anything in this report is deeply misleading.

The reporting of this latest update was even more muddled because it was combined with an anonymous statement from a “senior IMF official” by the Financial Times. The Financial Times lede reads as follows:

The International Monetary Fund has warned that it might not be able to participate in Greece’s bailout if the programme does not include substantial debt relief, setting itself on a collision course with the country’s eurozone creditors.

This (and the rest of the document) suggests to me that it is the Managing Director (ie Christine Lagarde) who goes to the board and ask for authorization. Is the anonymous official claiming to speak on behalf of Christine Lagarde? If so why is she not making this statement publicly? In my mind this anonymous official’s statements only make sense in three situations:

  1. Christine Lagarde is both unwilling to sign on to a deal the Eurogroup would currently agree to and unwilling to overtly and strongly pressure them to create a “better” deal they could sign. Thus she is aiming for a Grexit and no deal.
  2. Christine Lagarde is willing to sign on to whatever deal the Eurogroup would currently agree to but wants to covertly pressure them to offer more debt restructuring. In other words it’s a point of contention but not a dealbreaker.
  3. Many on the IMF staff don’t want Lagarde to sign whatever deal the Eurogroup is currently considering and specifically want much more debt restructuring. They have and are willing to leak things to the media to attempt to create this outcome whether by embarrassing their own Managing Director or putting indirect pressure on the Eurogroup.

To me option three seems like the most plausible. The same FT reporters (Peter Spiegel in Brussels and Shawn Donnan in Washington) reported over three weeks ago that a “senior [IMF] official” says many staff at the IMF “would rather cut off their little finger” than continue being involved in Greek bailouts. The use of similar descriptions (“senior official” and “IMF senior officials”) implies that the same sources at the IMF that said this over three weeks ago have been leaking the Debt Sustainability analysis and interpreted them for the press. This suggests a revolt among the rank and file of the IMF that doesn’t extend to the people who will ultimately make the decision. Remember that the definition of a “senior official” is necessarily vague to preserve anonymity and could easily be someone who can’t directly influence the decision made and certainly doesn’t speak for Lagarde. Thus, in this scenario this statement makes sense as a calculated lie by IMF staff to influence events. This also may suggest that my intuition earlier this week was wrong: it may not be the Obama administration crafting a narrative with the leaked reports and selective interpretations of official statements, but simply off the record comments from these same IMF staff sources (or at least, a complicated combination of both these sources).

What we are seeing here is a conflict between people who understand the underlying economics, and the “Very Serious People”, like Lagarde, or her predecessor Dominique Strauss-Kahn, who was in charge when the original deal with Greece was signed,  who are somehow operating out of a sense of European Union exceptionalism.

I would note that when DSK approved the original deal, he actually violated some basic IMF rules about requiring a creditor haircut, because, unlike dealing with, for example, Thailand, they know the creditors, and go to cocktail parties with them.

Tribalism is truly corrosive to good governance.

Ukrainian Humor is Odd

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Have you heard the one about how the Ukraine Prime Minister wants to reduce corruption in the country by privitizing state assets?

I’m not quite sure what the punch line is, but it’s clearly a joke: There has never been a privitization deal that has lessened corruption:

Ukraine’s Prime Minister is calling on Canadian investors to take part in a massive privatization of state assets organized by Kiev as a way of weakening the power of wealthy oligarchs blamed for spreading corruption in his country.

Arseniy Yatsenyuk cited, for instance, Ukrainian businessmen who have been “sitting like vampires” on the country’s publicly owned energy sector.

Mr. Yatsenyuk spoke to The Globe and Mail Tuesday after he joined Prime Minister Stephen Harper in Chelsea, Que., to announce that Ukraine and Canada had struck a free-trade deal.

Ukraine is preparing to spin off billions of dollars of government enterprises – including power generation and distribution assets and chemical plants – and the government wants Western investors to bring more orderly business methods to the Eastern European country.

“I don’t want Ukrainian tycoons to buy these state-owned enterprises,” Mr. Yatsenyuk said. “We would be happy to see Canadian folks buying Ukrainian assets and bringing into Ukraine good corporate governance, new investment and new jobs.

“That is what I asked the Canadian Prime Minister: ‘Please tell your investors and your businesses to jump into Ukraine.'”

Mr. Yatsenyuk said Ukraine’s leadership feels privatization and deregulation are the answers to the corruption that has plagued the country for decades.

“Big government always leads to big bribes and big corruption, so the less regulations you have the less authority the government has and the less chances to take bribes,” Mr. Yatsenyuk said.

OK, this isn’t a joke.  It’s a lie.

It’s a lie that is driven by a need to placate his masters in the west who want to buy state assets at pennies on the dollar.

It’s what Naomi Klein has called The Shock Doctrine, where, “Leaders exploit crises to push through controversial exploitative policies while citizens are too emotionally and physically distracted by disasters or upheavals to mount an effective resistance.”

To call this an anti-corruption measure is like calling a case of the Clap aid to picking up women.

An Interesting Perspective on No-Notice Inspections and Iran

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Over at The Intercept, they notice the oft ignored (at least on this side of the pond) fact that the United States used the Iraqi inspection regime in as a way to insert spies into the country:

Americans and Israelis who hate the new nuclear agreement with Iran are already focusing on one part in particular: It doesn’t authorize snap, no-notice inspections of all locations. Israel’s hard-right Education Minister Naftali Bennett claims the accord is a “farce” because “in order to go and make an inspection, you have to notify the Iranians 24 days in advance.”

 This is not exactly right, but close enough. (Iran’s declared nuclear sites will be under continuous monitoring. If the International Atomic Energy Agency wants to inspect a non-declared site and Iran refuses, Iran has 14 days to convince the IAEA it’s doing nothing wrong without providing access. If it can’t, the commission governing the agreement has seven days to vote on whether to force Iran to provide access, and if it does Iran has three more days to comply. The exact procedure is established in paragraphs 74-78 of the agreement text.)

 For people unfamiliar with the history of arms control generally and in the Middle East in particular, this might seem like a bad deal. If Iran doesn’t have anything to hide, why wouldn’t it allow the IAEA to go anywhere at anytime?

 The answer is twofold:

 First, all countries have things they legitimately want to hide, such as conventional military secrets and the security procedures of their leaders.

 Second, during the 1990s the U.S. demonstrated with Iraq that it would routinely abuse the weapons inspections process in order to uncover such legitimate secrets — and use them to target the Iraqi military and try to overthrow the Iraqi government.

 ………

 By the mid-1990s, Iraq claimed that the U.S. was using UNSCOM as cover for espionage aimed at things that had nothing to do with WMD, such as Saddam Hussein’s location. While the U.S. strenuously denied this for years, it turned out to be true. Moreover, former UNSCOM inspector Scott Ritter contends that the U.S. attempted to manipulate UNSCOM so that it could be used as a tool in an attempted coup against Saddam Hussein organized by the U.S. in 1996.

 Iraq acted at the time just as the U.S. would if the Organization for the Prohibition of Chemical Weapons had been infiltrated with “inspectors” who wanted to assassinate Bill Clinton and then showed up at the White House. For instance, when Clinton bombed Iraq in Operation Desert Fox in 1998, one of the justifications he gave was that Iraq had “shut off [UNSCOM] access to the headquarters of its ruling party.” The CIA later discovered that Saddam had in fact been at the party headquarters when UNSCOM arrived, and had stopped UNSCOM from entering “to prevent the inspectors from knowing his whereabouts, not because he had something to hide.”

 Moreover, the U.S. made extensive use of UNSCOM to target Iraq for bombing campaigns. According to Ritter, toward the beginning of the UNSCOM process CIA agents who were part of the inspection team used GPS to record the precise location of sites used for Iraqi military manufacturing — sites that soon afterwards were struck by U.S. cruise missiles. And as the Washington Post reported and the U.S. Air Force later confirmed, the U.S. used UNSCOM’s data to choose targets for Operation Desert Fox, including many that had nothing to do with Iraq’s purported WMD programs. ………

 So while Iran’s recalcitrance may make the U.S. and Israel unhappy, it’s largely the fruit of our own poisoned tree. They will never accept the conditions we imposed on Iraq, and any neutral observer would agree they’d be fools to do so.

Shades of the alleged “vaccination” program that allegedly identified bin Laden’s hiding place, which has discredited vaccination programs throughout the Islamic world, leading to widespread assassinations of public health workers, particularly in Pakistan.

Cue the Wingnut Head Explosion

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We have a nuclear proliferation deal with Iran, let the right wing to freak out begin.

Binyaman Netanyahu, who is arguably the least honest man in Israeli politics,* is condemning this as well, but seeing as how Netanyahu is continuing to ignore the Mossad’s assessment of Iran’s nuclear capabilities, I’ll put this down to Bibi playing domestic politics.

World powers have reached a deal with Iran on limiting Iranian nuclear activity in return for the lifting of international economic sanctions.

US President Barack Obama said that with the deal, “every pathway to a nuclear weapon is cut off” for Iran.

And President Hassan Rouhani said the “historic” deal opened a “new chapter” in Iran’s relations with the world.

Negotiations between Iran and six world powers – the US, UK, France, China, Russia and Germany – began in 2006.

The so-called P5+1 want Iran to scale back its sensitive nuclear activities to ensure that it cannot build a nuclear weapon.

Iran, which wants crippling international sanctions lifted, has always insisted that its nuclear work is peaceful.

There has been stiff resistance to a deal from conservatives both in Iran and the US. The US Congress has 60 days in which to consider the deal, though Mr Obama said he would veto any attempt to block it.

The Republican Speaker of the US House of Representatives, John Boehner, said the deal would only only “embolden” Tehran.

“Instead of stopping the spread of nuclear weapons in the Middle East, this deal is likely to fuel a nuclear arms race around the world,” he added.

Israel’s government has also warned against an agreement.

Prime Minister Benjamin Netanyahu said it was a “stunning historic mistake” that would provide Iran with “hundreds of billions of dollars with which it can fuel its terror machine and its expansion and aggression throughout the Middle East and across the globe”.

He said he did not regard Israel as being bound by this agreement. “We will always defend ourselves,” he added.

The alternative to this deal would have Iran to actually go full bore for a nuclear weapon.

This is far better than that.

*Boy, the concept of , “the least honest man in Israeli politics,” is a truly an awesomely mind f%$#ing concept.

There are Lies, Damned Lies, Statistics, and Official Chinese Government Statistics

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Is there anyone with two braincells to rub together who believes that China actually hit a 7% growth rate in the last quarter? I don’t,

Not only are the Chinese stats suspect at the top levels, but every regional and local government is feeding them data that is driven by what they think their higher-ups want to hear:

China’s economy grew an annual 7 percent in the second quarter, steady with the previous quarter and slightly better than analysts’ forecasts, though further stimulus is still expected after the quarter ended with a stock market crash.

It has been a difficult year for the world’s second-largest economy. Slowing growth in trade, investment and domestic demand has been compounded by a cooling property sector, deflationary pressure, and most recently a stock market crash, so the recent sequence of data releases showing signs of improvement may help buttress faltering confidence in the effectiveness of prior policy support measures.

Analysts polled by Reuters had forecast gross domestic product (GDP) in the world’s second-largest economy would grow 6.9 percent in April-June from a year earlier, compared with 7.0 percent in the March quarter.

On a quarterly basis, the economy grew 1.7 percent compared with 1.4 percent in the March quarter, the National Bureau of Statistics said on Wednesday.

Monthly activity data, released alongside the GDP report, also beat expectations across the board to show signs of a rebound, with factory output hitting a five-month high.

Yeah, right.  And the Chinese stock market is not melting down right now.

The Question Is Not If Sheldon Silver Flips on Andrew Cuomo, but When

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Marcello Trebitsch, the son-in-law of former New York State Assembly Speaker Sheldon Silver has just pled guilty to running a multi-year Ponzi scheme:

A son-in-law of former New York state Assembly Speaker Sheldon Silver pleaded guilty to securities fraud Monday, admitting to cheating investors out of nearly $6 million in a Ponzi scheme.

 Marcello Trebitsch, 37, of Brooklyn, entered the plea in Manhattan federal court in a written deal with prosecutors that recommended a prison sentence of four to five years. Sentencing was set for Nov. 2.

 “I am sorry for what I have done and I apologize to the court and my family,” Trebitsch told Judge Vernon Broderick.

 Prosecutors said Trebitsch, who is married to Silver’s daughter, solicited more than $8 million from four investors from 2007 to 2014 based on false and misleading representations.

 Silver, a Democrat who resigned from his leadership position after his January arrest on corruption charges, has pleaded not guilty and said he will be vindicated. Prosecutors say Silver took nearly $4 million in payoffs and kickbacks.

 Prosecutors said Trebitsch told investors they would secure double-digit gains with minimal risk of loss, but then Trebitsch mainly used the investors’ money for his own benefit and to repay other investors after suffering enormous trading losses on the portion of investors’ money that he did invest.

 ………

 In a release, U.S. Attorney Preet Bharara said Trebitsche “ran a multimillion-dollar Ponzi scheme, defrauding investors who put their faith in him and entrusted him with their hard-earned savings. He returned their faith with deceit and self-dealing, lying about his trading losses and using investor money on himself.”

Note that his wife, Michelle Trebitsch (née Silver), is a co-owner of the firm, Allese Capital, as well as being the certified public accountant who did the firm’s books, so it is likely that they will extract some sort of plea, or at least an admission, out of her.

Additionally, it is likely that  and a whole lot of their assets are going to be forfeited.

I’ve got to imagine that US Attorney Bharara would be eager to have Andrew Cuomo in the dock. It would be a major feather in is cap.

Right now, he has the sentence of Silver’s son in law, the possible prosecution of his daughter, and the potential for leaving his grand children penniless as well as parentless for a few years would be powerful  inducements for former speaker Silver to cooperate.

Silver will talk, and only question is whether he gets Cuomo, or he gets one of his closest associates, because Cuomo managed to create a level of plausible deniability in his dealings by using proxies.

Given that Cuomo is a former prosecutor, my guess is that it will be the latter, but I am hoping for the former.

Sh%$ Like This Makes Me Feel Unreasonably Smug

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It appears that the New York Times has finally had enough of right wing publishers manufacturing data for its best seller list, and it’s first target is the Ted Crux Book A Time For Truth:

Conservatives are furious at the New York Times for refusing to allow Ted Cruz and his publisher, HarperCollins, to game the system and “earn” his way on to the bestseller list via “strategic bulk purchases.”

 In an email to Politico’s Dylan Byers, Times spokeswoman Eileen Murphy explained why Cruz’s “A Time For Truth” was omitted, noting that the company has “uniform standards that we apply to our best seller list, which includes an analysis of book sales that goes beyond simply the number of books sold.”“In the case of this book,” she added, “the overwhelming preponderance of evidence was that sales were limited to strategic bulk purchases.”

 Conservatives are complaining that “bulk purchases” should still count as sales:

 ………

 And while they might have ground to stand on there — if by “bulk purchases,” the Times meant “10,000 copies purchased to be sold at Walmart” — but the Times specified that it believes HarperCollins engaged in “strategic bulk purchases.” In essence, The Times accused Cruz’s publisher of trying to buy its way onto the bestseller list by having a firm like Result Source hire thousands of people across America to individually purchase a copy of “A Time For Truth,” in the hope that some of those retailers are on the secret list of booksellers who report their sales to the Times, or that the aggregate purchasers will simply be too high for the Times to ignore.

 In other words, conservatives are upset that HarperCollins got caught trying to rig the system in order to make “A Time For Truth” a bestseller, though that’s not quite how they see it:

 ………

Wingnut tears are salting my soup as we speak.

Good News Everyone!

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Bloom County is returning to the funny papers, and I am stoked:

After 25 years, Berkeley Breathed is returning to his Pulitzer Prize-winning comic strip, “Bloom County.” Breathed announced the new incarnation of the politically-minded strip via a post on Facebook that featured him working on a new comic with the words “Bloom County 2015” at the top.

“Bloom County” originally ran from December 1980 until 1989, just two years after he won the Pulitzer. The characters, such as Bill the Cat, Opus the Penguin, Hodge-Podge the Rabbit, Milo Bloom, and Cutter John, lived on in the Sunday-only strip “Outland” from 1989 to 1995, as well as “Opus” from 2003 to 2008. When “Opus'” run ended, Breathed said he was stepping away from strips entirely and began focusing on writing children’s books. At the time, he said the political climate in the country had grown too bitter for him to continue taking a light tone on things, and he wanted to get out before things got too tough.

However, with the 2016 presidential campaign season heating up, it seems that Breathed has found something funny to talk about again:

I will miss Jon Stewart during the 2016 campaign, but Bloom County  coming back takes the sting out, at least a bit.

The Product of a Mentality of Lawlessness and Impunity

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Are we the baddies?

I do understand that, historically at least, the primary purpose of a military pistol is for officers to shoot deserters.

These days, in addition to marking a bag of rank, they do have uses for people like rear echelon troops and tankers.

They will never be a major force on the battlefield, but the fact that the blithe way in which the US Army is considering introducing Dumdum bullets in its new pistol:

The Army is considering the use of expanding and fragmenting ammunition, such as hollow point bullets, to increase its next-generation handgun’s ability to stop an enemy.

 This bit of news was revealed Tuesday, during the service’s fourth industry day for its Modular Handgun System.

 After a recent legal review within the Pentagon, the Army can consider adopting “special purpose ammunition,” said Richard Jackson, special assistant to the Army Judge Advocate General for Law of War, according to an Army news release. This marks a departure from battlefield practices over a century old.

 Jackson told Army Times that while this isn’t the first approved use of such bullets in the military, the stance represented “a significant re-interpretation of the legal standard” for ammunition. He also said a lot has changed since the initial movements against the round, especially with the increased prevalence of asymmetric warfare.

 “There’s a myth that [expanding/fragmenting bullets] are prohibited in international armed conflict, but that doesn’t make any sense now,” Jackson said.

 ………

 On the battlefield, the U.S. has generally observed the 1899 Hague Convention rule barring expanding and fragmenting rounds, despite the fact that it never has been signatory to that particular agreement, Russell said.

 The U.S. reserved the right to use different ammunition where it saw a need. For example, Criminal Investigations Command and military police use hollow points — as do law enforcement agencies around the country — in part to minimize collateral damage of bullets passing through the target. Special Forces also uses expanding/fragmenting rounds in counter-terrorism missions.

 “The use of this ammunition supports the international law principles of preventing excessive collateral effects and safeguarding civilian lives,” an Army statement said.

So, not only are they choosing to ignore a bit of international which has been observed by basically everyone since the early 1900s, but they are declaring that a direct violation of the convention is actually just fine, because. ……… Well, just because.

The US state security apparatus y did the same thing with the Geneva conventions on the treatment of prisoners of war, despite the fact that the Third Geneva Convention specifically requires that signatories apply the standards to non-signatories.

Even if one dismisses the humanitarian considerations,  the fact that this sort of breakdown in professional ethics frequently presages the end stage of a declining empire.

How the Germans Have Yet Again F%$#ed Up a Signature Foreign Policy Initiative

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First, the hash tag: #ThisIsACoup , which is trending on Twitter.

Rather unsurprising, given that now that Greece has capitulated to the insane and sadistic demands of the Troika, but there is still no deal because the so-called hawks still want another pound of flesh:

Greece’s final attempt to avoid being kicked out of the euro by securing a new three-year bailout worth up to €80bn ran into a wall of resistance from the eurozone’s fiscal hawks on Saturday.

Finland rejected any more funding for the country and Germany called for Greece to be turfed out of the currency bloc for at least five years.

All of this means that not only will Greece have to leave the Euro, but it means that there will be poverty, epidemics, and starvation that has not been seen on the European continent since the end of World War II.

It also means that Greece will be exiting the Euro Zone, because all of its banks will be shuttered in the next few days.

This could have turned out better, but it now appears that the current Greek government has made no plans at all for the eventuality of leaving the Euro:

Here are just a few of their concerns – focused in particular on the idea, put forward by the German Finance Minister Wolfgang Schaeuble, that there perhaps could and should be a temporary exit of Greece from the euro.

So the first rather chilling thing I’ve learned, from well-placed bankers, is there have been no conversations between the Bank of Greece, the government or regulators and Greece’s commercial banks about the technicalities of leaving the euro and adopting a new currency.

(emphasis mine)

The “hawks”, in particular the Germans, and most particularly Wolfgang Schäuble, are eager to make an example of Greece, thinking that this will cow the other members of the Euro Zone will see what happens to the Greek people and fall into Germany’s hegemonic line.

I think that this is a gross miscalcculation.

Any nation in the Euro zone that is seeing what is being done to Greece has to be drawing contingency plans for a rapid flight from the monetary union.

The lesson of this disaster is that a plan be that can be implemented in a few days must be ready to go, and I expect  that plans are being drawn up in Italy, Spain, Portugal, and Ireland.

If any of these countries has their ducks in a row, then in the event of a Euro exit, it means that this action will in fairly short order be followed by economic growth.

Once this happens, it is likely that the others will follow, seeing that an exit can be managed gracefully.

If either Italy or Spain leaves, the Euro would soar, because the effects of Germany’s predatory export state on the currency would be less diluted, which would likely make countries like France, the Netherlands, and Belgium (particularly with the possibility of an ethnic split between Flemish and Walloon) look for the exit as their exports become prohibitively expensive.

Assuming the gradual dissolution of the Euro, or as I like to think of it, the New Reichsmark, Germany sees its currency become much stronger, and its export driven economy looks a less successful.

I expect this to happen for two reasons:

First, because I do not see how the Euro can survive in the face of the German insistence on economics as a morality play.

Second, it is clear that the creation of the Euro, and its management over the past decade have been a major foreign policy initiative by the Germans, and all of the “bold” German foreign policy initiatives since reunification (there were none prior to reunification) have been a disaster, with Germany’s premature recognition of Slovenia, hastening the brakup of Yugoslavia, which prevented a negotiated separation, and guaranteed a bloody civil war being only the first of such disasters.

The Euro was structured by the Germans for the benefit of Germany, and the rest of the people of Europe are reaping a bitter harvest as a result.

And from the Only Country with a More Dysfunctional Weapons Development Program than Ours………

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It appears that India’s Tejas light fighter ,already more than 30 years in development, will face further delays:

Delayed by more than 15 years, India’s homegrown Light Combat Aircraft (LCA) Mark-1 is ready for critical test flights necessary for its final operational clearance (FOC) at the end of the year, but analysts and Indian Air Force (IAF) officials say that clearance will slip again, to next year.

Though he did not provide a date for the test flights, a Defence Ministry official said they will include firings of a variety of weapons, including air-to-air missiles and Israeli-made Derby beyond-visual-range missiles. The Russian-made close-combat missile R-73 has already been integrated on the aircraft.

………

“FOC would most probably slip to sometime in 2016,” Kak said. “But given the track record, these kind of slippages have over the years been accepted as par for the course.”

The Air Force ordered 20 of the Mark-1s after the aircraft’s initial operational clearance in December 2013, and is set to order an additional 20 following FOC. State-owned Hindustan Aeronautics Ltd. (HAL) will produce all 40 aircraft under limited series production and says it has the capacity to produce eight LCA Mark-1s a year once the full order is placed.

But so far the Air Force has received only one aircraft to use for weapon integration and testing, not the four it wanted to have at this stage.

“Weapons integration has been on for quite some time and the LCA has fired the R73 missile and laser-guided bombs during [the Air Force’s] firepower demonstration in February 2014,” said Daljit Singh, retired Air Force air marshal. “However, more weapons are required to be integrated. In addition to weapons integration, test flights are also required to integrate and test other avionics and systems.

This program has been in development for 32 years, and they still cannot deliver the number of aircraft needed for qualification trials, and those that they do develop will have a lower performance engine than the original domestic powerplant.

This is a complete cluster f%$#.