Tuesday, February 7, 2017

Today's links

1--US Economic Confidence Index Hit New High in January (Everything is looking rosy, so far.  Oh wait....)

Americans' confidence in the U.S. economy remained strong in January. Gallup's U.S. Economic Confidence Index averaged +11, the highest monthly average in Gallup's nine-year trend...

Republicans' improved confidence in the economy upon Trump taking office was perhaps expected, as Democrats enjoyed similar levels of confidence during President Barack Obama's tenure. But with the inauguration confetti now settled, Americans of all political stripes will need to see results of an improving economy to maintain this high degree of confidence, which already appears to be slipping in early February's three-day rolling averages.

2--Trump is no fascist. He is a champion for the forgotten millions

...millions of Democrats who voted for Barack Obama in 2008 and 2012 cast their votes for Trump. In those earlier elections, these blue-collar Democrats were voting for change, hoping Obama would prioritise the needs of working Americans over the elites and special interests concentrated in Washington DC and Wall Street.

For many Americans, Hillary Clinton personified the corruption and self-dealing of the elites. But Trump’s election wasn’t just a rejection of Clinton, it was a rejection of politics as usual. If the media and political establishment see Trump’s first couple of weeks in office as a whirlwind of chaos and incompetence, his supporters see an outsider taking on a sclerotic system that needs to be dismantled. That’s precisely what many Americans thought they were doing eight years ago, when they put a freshman senator from Illinois in the White House. Obama promised a new way of governing – he would be a “post-partisan” president, he would “fundamentally transform” the country, he would look out for the middle class. In the throes of the great recession, that resonated. Something was clearly wrong with our political system and the American people wanted someone to fix it.

After all, the Tea Party didn’t begin as a reaction against Obama’s presidency but that of George W Bush. As far as most Americans were concerned, the financial crisis was brought on by the excesses of Wall Street bankers and the incompetency of our political leaders. Before the Tea Party coalesced into a political movement, the protesters weren’t just traditional conservatives who cared about limited government and the constitution. They were, for the most part, ordinary Americans who felt the system was rigged against them and they wanted change.

But change didn’t come. What they got was more of the same...

In many ways, the 2016 election wasn’t just a referendum on Obama’s eight years in the White House, it was a rejection of the entire political system that gave us Iraq, the financial crisis, a botched healthcare law and shocking income inequality during a slow economic recovery. From Akron to Alaska, millions of Americans had simply lost confidence in their leaders and the institutions that were supposed to serve them. In their desperation, they turned to a man who had no regard for the elites – and no use for them.

In his inaugural address, Trump said: “Today, we are not merely transferring power from one administration to another or from one party to another, but we are transferring power from Washington, DC, and giving it back to you, the people.” To be sure, populism of this kind can be dangerous and unpredictable, But it doesn’t arise from nowhere. Only a corrupt political establishment could have provoked a political revolt of this scale. Instead of blaming Trump’s rise on racism or xenophobia, blame it on those who never saw this coming and still don’t understand why so many Americans would rather have Donald Trump in the White House than suffer the rule of their elites.

3--“The last thing we need is a relaxation of regulation,” Mr Draghi said.

“The fact that we are not seeing....significant financial stability risk is the reward of the action of supervisors.... Nowadays financial intermediaries are strong. The idea of repeating the conditions of before the crisis is very worrisome.”

4--US provokes Iran

As U.S. tensions with Iran rose last week, 17 ships from the United States, United Kingdom, France, and Australia launched a major war game just 50 miles from the Iranian coast.
Smack dab in the middle of the gulf, the ships steamed together in wedge formation in the first iteration of the exercise dubbed “Unified Trident.”

5--U.S. Involvement in Yeltsin’s Russia: From "America’s Colony" to "Number One Threat  Important video

6--Trump blurts out the truth about US killings and the media goes wild

In a review of Joshua Kurlantzick’s A Great Place to Have a War: America in Laos and the Birth of the Military CIA, reviewer Scott Shane wrote in the February 3 edition of The New York Times :
“Speaking last September in Vientiane, the capital of Laos, Barack Obama mentioned a staggering fact: that the United States had between 1963 and 1974 dropped two million tons of bombs on the country, more than the total loosed on Germany and Japan together during World War II. That made Laos, which is slightly smaller than Michigan, the most heavily bombed nation in history, the president said. More than four decades after the end of the war, unexploded ordnance is still killing and maiming Laotians, and Obama announced that he was doubling American funding to remove it.”
Calling attention to information in Kurlantzick’s book, Shane noted: “In his first presidential term, Richard M. Nixon escalated the bombing from about 15 sorties per day to 300 per day. ‘How many did we kill in Laos?’ Nixon asked Henry Kissinger one day in a conversation caught on tape.

Kissinger replied: ‘In the Laotian thing, we killed about 10, 15’--10,000 or 15,000 people, he meant. The eventual death toll would be 200,000.”

When it comes to killing, the US Government is without equal. In multiple wars of aggression, from Korea to Vietnam, Afghanistan, Iraq, Libya and the proxy war for regime-change in Syria, US imperialism has killed and maimed tens of millions.

The chief accusation being leveled against Trump--by both supposed liberals in the Democratic Party and right-wing Republicans--is that he implied a “moral equivalence” between Russia and the US. This was a phrase used during the Cold War to justify every crime committed by the US and its allies, from Latin America’s bloody dictatorships to the Apartheid regime in South Africa, on the grounds that there could be no “moral equivalence” between the leader of the “Free World” and the Soviet “Evil Empire.”

There is, in fact, no equivalence. When it comes to killing and global thuggery, Putin is a small fry compared to the leaders of the United States...

Underlying the furor over Trump’s remarks are fierce divisions over US imperialist strategy and Washington’s preparations for war that have been brought into the open with the change of administrations....

Talk of “respecting” Putin, possible collaboration with Russia against ISIS in Syria, and an easing of sanctions is not, as the Democrats have suggested, evidence of some secret control exercised by the Kremlin over Trump. It is, rather, part of a definite strategy of peeling Russia off from Iran in order to pave the way for a new war in the Middle East, while sharply escalating provocations against China.

Citing unnamed administration officials, the Wall Street Journal spelled this policy out on Monday:

The administration is exploring ways to break Russia’s military and diplomatic alliance with Iran... The emerging strategy seeks to reconcile President Donald Trump’s seemingly contradictory vows to improve relations with Russian President Vladimir Putin and to aggressively challenge the military presence of Iran.”

Trump’s chief White House strategist and adviser, Stephen Bannon, a student and admirer of Adolf Hitler, no doubt views the administration’s pivot toward Moscow through the historical prism of the Stalin-Hitler pact, which set the stage for the Second World War, a war that ultimately claimed 20 million Soviet lives....

Within the US political establishment and Washington’s vast military and intelligence apparatus, there exists sharp opposition to Trump’s turn in foreign policy. Immense political, military and financial resources have been invested in the buildup against Russia, from the coup in Ukraine to the deployment of thousands of US and NATO troops on Russia’s western border. There are concerns within ruling circles that a shift in imperialist strategy is reckless and poses serious dangers.

While popular attention and outrage have been focused on Trump’s anti-democratic executive orders imposing a ban on Muslims and refugees, ordering a wall built on the southern border, and laying the groundwork for a mass dragnet against undocumented immigrant workers, within the ruling class a serious fight is being waged over global imperialist strategy.

This fight over policy is between two bands of cutthroats, each of which is committed to an escalation of US militarism to further the profit interests of the US-based banks and transnational corporations. Whichever one wins out, the threat of world war, rooted in the crisis of global capitalism, will only grow.

7--Anytime the government deregulates Wall Street, a financial crisis follows.

The deregulation of the big banks in the 1920s caused the crash of 1929 and the Great Depression, Reagan's deregulation of the S&L's in the early 1980s caused the S&L crisis, and repealing Glass-Steagall back in the 2000s caused the crash of 2008.

These are just facts, and if Trump goes ahead with his push to gut Dodd-Frank, he next financial crisis is all but inevitable.

8--Trump-Cohn Financial Rewrite-- They could offer Wall Street fewer rules in return for more capital

The better way to prevent a panic is to have simple but firm rules along with high capital standards that make banks better able to endure losses in a downturn. That’s the philosophy behind House Financial Services Chairman Jeb Hensarling’s proposed financial reform, and it’s the direction the Trump Administration should take even without legislation.

But will it? The President signed his directives Friday after meeting with bank executives, and he didn’t help himself politically by praising the “great returns” BlackRock has earned. The point is to help the larger economy, not bank profits
more leverage, more risk, more privatization of profits, socialization of risk

9--Game on:  Putin Signs Law on Ratifying Deal With Ankara on Turkish Stream Gas Pipeline

 10--United States is right. Russia is a threat. A threat to American world dominance  Bill Blum

in early January, the United States embarked upon its biggest military buildup in Europe since the end of the Cold War – 3,500 American soldiers landed, unloading three shiploads, with 2,500 tanks, trucks and other combat vehicles. The troops were to be deployed in Poland, Romania, Bulgaria, Germany, Hungary and across the Baltics. Lt. Gen. Frederick Hodges, commander of U.S. forces in Europe, said, “Three years after the last American tanks left the continent, we need to get them back.”

The measures, General Hodges declared, were a “response to Russia’s invasion of Ukraine and the illegal annexation of Crimea. This does not mean that there necessarily has to be a war, none of this is inevitable, but Moscow is preparing for the possibility

11--Trump Stands Up For Bad Bankers

the Fraudsters On February 3, President Trump signed executive actions rolling back financial regulations that were put into place after Congress passed the Dodd-Frank banking reform bill in 2010.

That bill didn’t include all of the measures some believe are needed to rein in bank fraud and mismanagement. But, as
Federal Reserve Chair Janet Yellen notes, it represents an improvement over the status quo that led to the 2007-08 financial crisis. The Dodd-Frank provisions endangered by Trump’s announcement are designed to increase financial stability, reduce risky bank behavior and limit predatory mortgage lending.

Trump also moved to end something called the “
fiduciary rule,” a technical-sounding name for something that serves a relatively simple goal: to prevent people who give advice about retirement accounts from having hidden financial incentives that conflict with their clients’ interests.Bad Company

Trump didn’t just declare war on these fundamental financial protections. He also showed the public where his loyalties lay. As he announced the gutting of controls on big bankers, Trump gave a special shout-out to one of the worst of them: Jamie Dimon. As CEO of JPMorgan Chase, Dimon has led one of the most criminally inclined institutions on Wall Street. The long list of documented crimes committed under Dimon’s leadership includes money laundering for drug cartels, foreclosure fraud, and violation of sanctions against Cuba, Iran and Sudan.

Trump chose Gary Cohn, the new head of his Council of Economic Advisors, to
announce the change in the fiduciary rule. Cohn is the former COO of Goldman Sachs, and one of many Trump appointees from that Wall Street powerhouse. When it comes to criminal behavior, Goldman is arguably JP Morgan’s only challenger for the title of “most corrupt“ investment bank.

With these actions, Trump has let the American people know whose side he’s on, and it’s not theirs. Millions of people are now more likely to be robbed of their savings, their homes and their retirement security.

12--Republicans Get Ready to Roll Back Dodd-Frank Law-- Legislative challenge will primarily play out in Senate, where GOP holds 52 seats, but passage of overhaul likely would require 60 votes

Republicans in Congress are preparing to release plans to roll back the 2010 Dodd-Frank financial overhaul as early as this week, following an executive order by President Donald Trump seeking a broad review of the Obama-era law.

House Financial Services Committee Chairman Jeb Hensarling (R., Texas), who has been working on a package to undo parts of Dodd-Frank, is poised to unveil his plan, called the Financial Choice Act 2.0, people familiar with the matter said.
The Dodd-Frank law was enacted after the financial crisis when Democrats controlled Congress and the White House with the aim of avoiding another economic meltdown. Republicans and industry critics say it has led to overly burdensome regulations that unnecessarily constrain financial firms and limit consumer options for financial products....

change the leadership of the Consumer Financial Protection Bureau from a single director to a five-person commission.
There are other, more significant, regulatory rollbacks that have been proposed, such as repealing the Volcker rule, which restricts how banks invest taxpayer-insured deposits, or scrapping mortgage-underwriting standards that were designed to try to ensure that borrowers have an ability to repay.

13--- The fiduciary rule, proposed by the Labor Department to mitigate conflicts of interest among those advising investors on their retirement assets, is due to take effect April 10.

But President Donald Trump directed the Labor Department to review and halt the retirement-savings rule if it determines it conflicts with the administration’s regulatory principles.

Among the conflicts the fiduciary rule seeks to address are sales commissions and other fees charged by funds that could encourage advisers to sell one fund over another or to churn funds simply to be paid more

14--How Big Banks Want Donald Trump to Change Regulation -- Banks are also looking for a change in tone among regulators, saying relations have become too adversarial in recent years  Regulators are "too adversarial"????

The Dodd-Frank law spawned thousands of pages of rules designed to make banks safer. Now, with President Donald Trump looking to undo much of that legislation, banks are scurrying to prepare their wish lists.

It isn’t an easy task, in part because many bank executives say the sprawling law did some good, helping restore confidence in both bank balance sheets and the financial system. But it also has added costs and restrictions they say have hurt profits and restricted lending.

Banks and investors reacted positively Friday to the White House’s proposal to gut the 2010 Dodd-Frank financial overhaul act. Shares of the biggest lenders rose between 3% and 6% on investor hopes that banks’ costs would drop sharply and that the deregulatory moves could boost lending revenue and economic growth...

Next up on bankers’ wish lists are changes to the so-called stress tests administered each year by the Federal Reserve. The exam is meant to gauge a bank’s ability to weather big shocks that could upend the financial system.
While banks say stress tests have merit, they want a process that is more quantitative, less unpredictable and more collaborative. This is crucial for them since the tests help determine how much capital banks can return via dividends or share buybacks....

Aside from specific rules changes, many banks would welcome a change in tone among regulators, who have leeway in how they interpret rules. Some say relations between banks and regulators have become too adversarial in recent years.

That is one area where the administration may be able to have the most immediate impact. In the next 18 months, President Trump is expected to get the chance to appoint a variety of financial regulators from key Federal Reserve governors to the heads of the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corp. and the Consumer Financial Protection Bureau.

“There could be major changes just through the changes at the heads of the agencies,” said H. Rodgin Cohen, senior chairman of law firm Sullivan & Cromwell LLP. “And in some critical respects, [bank] supervision is the most important element. You don’t actually need legislation.”

15--G-Sax "That is one shitty deal"

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