Thursday, September 1, 2016

Today's links

1--Apple's Tim Cook has to pay taxes: "WAH"--Standing up to Apple

2---Cash Keeps Pouring Out of European Stocks --European equity funds have seen outflows for a record 29 consecutive weeks, amid poor earnings, struggling banks and political risk

(Hmmm? Looks like those negative rates sure work good!)
Money has flowed out of European stock funds every week for more than six months, a stretch that is longer than the previous record set during the financial crisis.
Few see the negative flows abating soon, with earnings weak, banks struggling across the Continent and the political landscape in flux.

Flows were negative for the 29 weeks through Aug. 24, according to data tracker EPFR Global. That marks a record since the company began collecting this data in 2002 and eclipses the 27-week run of outflows that ended in February 2008.

The Stoxx Europe 600 index is down 6.1% this year, compared with a gain of 6.2% for the S&P 500.
Late last year, investors put money into Europe as they expected the U.S. to raise interest rates. Higher rates could push money out of U.S. stocks into Europe because they could hurt Americans’ consumer spending, among other factors. But with no further rate increases from the U.S. Federal Reserve so far this year, those flows have reversed. Though, Fed Chairwoman Janet Yellen signaled last week that the central bank could raise short-term interest rates possibly as soon as next month...

Last year, the European Central Bank’s first quantitative-easing program helped to juice the stock market, pushing debt yields lower and prompting investors to seek returns in shares. But analysts are now more skeptical about how much monetary policy can do to help, even as the ECB remains in easing mode.
“Monetary easing is no longer enough,” Deutsche Bank AG DB -1.08 % ’s European equity researchers said in a note. “The scope for structural upside for European equities on the back of a further central-bank-sponsored reduction in fixed-income spreads is limited.”
The ECB has also turned to negative interest rates in its bid to stimulate the European economy, and that has taken its toll on the region’s banks by reducing the margins they can make on lending.

3---Car sales, Bank loans, Mosler

More evidence the wheels are coming off, not that there have been any doubts

4--Are we already in recession? Uh huh

In May 2016, rolling averages for tax revenues went negative, and are continuing to tred in negative territory...just as they did in February 2008 and in 2001 two months after the official start of the recession.

5---US Air Force Denied to Provide Air Support for Turkish Operations against ISIS in Syria; US won't lift a finger to help Turkey

On Tuesday the terrorist militia ISIS has carried out an attack against the Turkish army in Syria. The Turks requested that the US, due to a binding agreement, supply air support against the terrorist militia. But the US Air Force is said to have ignored the request for help.

On Tuesday the terrorist militia ISIS attacked pro-Turkish mercenaries and the Turkish military in the west of Jarabulus. A Turkish tank was hit by a rocket launcher, Reuters reports. Three soldiers were wounded. According to information of the news agency Anadolu, the attack of ISIS took place around 18 o’clock. The Turkish military contacted the US Air Force in Incirlik to request air support against ISIS. But the US-Jets ignored the request of the Turks to help against ISIS, to which Ankara and Washington had previously agreed. The Americans are accused of having hold out on the Turks for an hour. Finally, the Turks decided to use their own jets against ISIS.

US jets however flew three hours later into the combat zone, bombed empty stretches of land and flew back. “The Americans had promised to send US jets in emergency for support. But they did not come. We have a number of casualties. It was part of the plan that Americans provide assistance against ISIS. They should have come to help us. Because of the promise of the Americans, the Turkish Air Force came almost too late and we would have suffered heavy losses, “Al Jazeera quoted a spokesman for the pro-Turkish mercenaries.

The Wall Street Journal reported that government officials from Washington had already informed Turkey on Monday, that they wouldn’t give air support to the Turkish troops in the Syria conflict, if they should continue to march southward. But in the current case, the Turks were attacked in the west of Jarabulus. For this part of northern Syria and against ISIS Americans had assured the Turks of air support

6--Turkey and Russia are now deciding Syria's future while Uncle Sam sits on the sidelines

Turkey has aligned with Russia and Iran and some, may be temporary, agreement was found with regards to the conflict in Syria..... There is a real conflict between the U.S. and Turkey. Turkey indeed moved on a plan that Russia, Iran and Syria had agreed with. The U.S was caught off guard...

Mohammad Ballout writes for Lebanon's Assafir newspaper. His latest as translated by Yalla La Barra:
The Syrians and the Turks are on the verge of a security understanding that will lead to a political one. The indications of this unprecedented understanding are not yet clear. But its first headline, without any surprises, is a trade off: the Turks backing off in Aleppo and closing the crossings used by some of the armed groups (the most important ones) in the north in exchange for the Turkish forces to be given the freedom to destroy the Kurdish project in Syria. In other words, the city of Aleppo goes to Syria and the corpse of the Kurdish project in Syria goes to the Turks.
It can be said that the Turks have taken a first step to separate the moderate opposition from the extremist groups. Turkey’s recent diversion of thousands of fighters from the fronts of Aleppo and Idlib represents a Turkish initiative to separate the factions it directly mentors from the extremist groups who coordinate their operations.....

the Americans are feeling uncomfortable about the Turkish-Iranian-Russian rapprochement and have instructed their agencies to stop providing the Turks with military/security information in Syria....

Elijah J. Magnier reports for the Kuwait AlRai on the deal with some special insight on the Russian role:
During their meeting in St. Petersburg and following consecutive reunions later, plus an exchange of visits by high-ranking military officials, Russia and Turkey agreed on the role the Turkish forces could be offered in Syria, within specific parameters that will serve both sides interest, as long as there are limits and guarantees offered by both parties.
Russia has accepted a Turkish incursion into Syrian territory due to the Kurds’ declared hostility to the government in Damascus when YPG forces attacked and expelled the Syrian army from al-Hasakah city to the suburbs, with US backing, – a clear intention to initiate the partition of Syria. Russia stands against a Kurdish state ruled by the US in the new Kremlin Mediterranean base, Syria.
Turkey expressed its willingness to collaborate and instruct many rebel groups under its direct influence, to reject unification, avoid the merger proposed by Nusra, and keep its distance from the Jihadists, mainly in the northern city of Aleppo. [...] Turkey agreed to avoid any contact or clash with the Syrian army, mainly around Aleppo, in support of the Syrian rebels and jihadists.
Russia made it clear to Turkey that it will not tolerate any infringement of the agreement or any clash with the Syrian Army drawing clear redlines, and threatening that its Air Force will hit the Turkish forces and its proxies in case of any similar violation.
All these talks were not just between Turkey and Syria (in Algeria) or between Moscow and Ankara. There was a wide framework discussed between all relevant forces - Syria, Iran, Iraq, Russia, Turkey and others and only the U.S. (it seems) was left out...

The deal with Turkey will prevent control of the U.S. over significant parts of Syria and the federalization of the country the neocons promote.

7--Turkey’s new sultan drives Uncle Sam, Ivan and Ali up the wall

Turkey’s display of strategic autonomy during its intervention in Syria has unnerved the U.S., Russia and Iran. Ankara can give three days’ notice to cancel access for the US to the Incirlik base. As the military balance changes, Iranian forces and Hezbollah have to get used to a superior military power with boots on the ground in Syria. Although Moscow has urged Ankara to undertake course correction, the future directions of the Turkish intervention in Syria remain unclear...

Indeed, the future directions of the Turkish intervention in Syria remain unclear – except that it is for the long haul. Turkey’s display of strategic autonomy has unnerved the three main protagonists – US, Russia and Iran.
In a series of statements, US conveyed that Turkish operations against Kurds are “unacceptable”. France has also echoed similar views.

On Wednesday, Moscow and Tehran calibrated their ‘distance’ from the Turkish intervention. But their accent markedly varied.
Tehran was implicitly critical of Turkish intentions; whereas, Moscow didn’t cast aspersions on Turkish motivations.
Tehran said Turkey’s act of violating Syria’s sovereignty and territorial integrity is “unacceptable”; whereas, Moscow wouldn’t make an issue of it. (Ankara had notified Damascus about its intervention using Russian channel.)

Evidently, Moscow takes a holistic view. The most critical factor for Russia will be Turkey’s role in the western alliance system. Turkey may play off Russia and US against each other, but the “unknown unknown” here is the nature of intelligence Putin would have shared with Erdogan regarding the July 15 coup attempt, and how far the latter feels indebted to the Kremlin.
Moscow weighs in that repair of Turkey-US relationship will take time and the extradition of Fetullah Gulen remains an Albatross on American neck. On the other hand, Moscow has had to reconcile with the idea of Turkish jets reappearing in Syrian skies and Turkish boots on the ground in northern Syria.
If Turkey manages to create a 3000-4000 sq. kilometre ‘buffer zone’ in Syria, the necessary underpinning for the EU-Turkey ‘one in, one out’ deal on Syrian refugees becomes available.
To be sure, Ankara’s display of strategic autonomy is already showing results. Both Obama and Putin plan to meet Erdogan during the G20 summit in Hangzhou (September 4-5). And the EU and NATO are scrambling, too...

The DECA expressly disallows the US from using Incirlik for its own purposes. Turkey’s approval is necessary even with regard to the use of the base by the US for NATO missions. Turkey can give three days’ notice to cancel access for the US to the Incirlik base.
The fact remains that Turkey views with suspicion the activities of the US and the NATO out of Incirlik base, from where only the Turkish Air Force stationed alongside the western forces had plotted the coup attempt.
Embittered straggler
For the present, though, Iran seems to be the odd man out. The Iranian forces and Hezbollah have to get used to a superior military power with boots on the ground in Syria. The military balance changes.
The impact on Aleppo remains to be seen. Turkey has dispatched hundreds of rebel fighters in the past week and may carve out a ‘buffer zone’ from where it can breach the siege of Aleppo

8 -Gareth Porter: US role in the Syrian bloodbath

why the Obama administration acquiesced to its allies funding and supplying a group of unsavoury sectarian armed groups to overthrow the Assad regime.

That US acquiescence is largely responsible for a horrible bloodletting that has now killed as many as 400,000 Syrians. Worse yet, there is still no way to end the war without the serious threat of sectarian retribution against the losers.

“The Obama administration bears responsibility for this atrocity, because it could have prevented Turkey, Qatar and Saudi Arabia from launching their foolishly adventurous war in Syria. None of them did so out of desperate need; it was a war of choice in every case. And each of the three states is part of the US security system in the Middle East, providing military bases to NATO or to the United States and depending on US support for its security.

But instead of insisting that those three Sunni allies reconsider their options, the Obama administration gave the green light at a conference in Riyadh at the end of March 2012 for proceeding with arming those who wanted to replace the regime, leaving the United States ostensibly free to be a peacemaker. As Hillary Clinton put it at the Riyadh conference: “Some will be able to do certain things, and others will do other things.”

...Could senior Obama administration officials have been unaware that a war to overthrow Assad would inevitably become an enormous sectarian bloodbath? By August 2012 a US Defense Intelligence Agency report intelligence warned that “events are taking a clear sectarian direction,” and that the “the “Salafist[s], Muslim Brotherhood and AQI [al-Qaeda in Iraq]” were “the major forces driving the insurgency”.

9--Turkey's Ground Offensive in Syria Caught Washington 'Off Guard'

Turkey's plans were shelved when Russia launched its counterterrorism campaign in Syria in September 2015. The downing of a Russian bomber by the Turkish Air Force on November 24, 2015, was also a factor that prevented Ankara from giving the operation the green light.

Washington seems to have warmed up to the initiative in recent months, but the US wanted to remove Kurdish forces from the conflict area. The White House was ready to conduct a high-level meeting on the possible operation on August 24, the Wall Street Journal reported, but by that time Turkey had already launched the ground offensive. "Ankara pulled the trigger on the mission unilaterally, without giving officials in Washington advance warning," the newspaper noted, adding that Turkey conducted its first airstrikes against targets in Syria alone.

Washington characterizes its CIA-backed Sunni proxy forces as “moderate” and “democratic.” It is, however, indicative of their real character that they include the group Noureddine al-Zinki, which has received covert aid from the United States and its allies despite having ties to Al Qaeda-linked groups. A group of its fighters achieved notoriety by videotaping themselves beheading a young prisoner...

The government of President Erdogan on Wednesday responded to a series of demands from US officials the previous day that it halt its attacks on Kurdish forces in Syria by reiterating its intention to continue its invasion until all “terrorist” forces, Kurdish as well as ISIS fighters, had been eliminated. Ankara considers the YPG and its political arm, the Democratic Union Party (PYD), to be extensions of the Kurdistan Workers Party (PKK) in Turkey, which it brands a terrorist organization and against which it has been fighting for decades.

Prime Minister Binali Yildirim said that military operations “will continue until all terrorist elements have been neutralized, until all threats to our borders, our lands and our citizens are completely over.”

This followed a speech Sunday by President Erdogan in the southeastern town of Gaziantep, where 54 people were killed the previous week in a suicide attack on a Kurdish wedding. Erdogan declared, “We cannot tolerate any terror organization within or close to our borders. That’s why we are in Jarabulus. And, if necessary, we will not flinch from taking on similar responsibilities in other areas.” He added that “operations against terrorist organizations will continue until the end.”

Turkey dismissed reports of a temporary cease-fire between Turkish-led forces and Kurdish militia in Syria issued Tuesday by the US military and the Kurdish-backed Jarabulus Military Council.
To underscore Ankara’s defiance, Foreign Ministry spokesman Tanju Bilgic called US criticism of the scale and goals of the Turkish offensive “unacceptable” and announced that US Ambassador John Bass had been summoned to the ministry to discuss the matter.

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